1
EXHIBIT 4.1
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UROHEALTH SYSTEMS, INC.,
THE COMPANY,
AND
THE GUARANTORS NAMED HEREIN
AND
THE BANK OF NEW YORK,
TRUSTEE
________________
INDENTURE
Dated as of April 10, 1997
________________
$110,000,000
12.5% Senior Subordinated Notes due 2004
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2
CROSS-REFERENCE TABLE
TIA INDENTURE
SECTION SECTION
------- ---------
310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(a)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.8;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.2
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.3
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.3
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6
(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.2
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.4
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.4
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.5
(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1(b)
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.5;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.2
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1(a)
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TIA INDENTURE
SECTION SECTION
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(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1(c)
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.13
316(a)(last sentence) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.9
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.12
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.12;
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.8
317(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.4
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.1
__________________________
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 1.2 Incorporation by Reference of TIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 1.3 Rules of Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE II
THE SECURITIES
Section 2.1 Form and Dating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.2 Execution and Authentication . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.3 Registrar and Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.4 Paying Agent to Hold Assets in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.5 Securityholder Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.6 Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.7 Replacement Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.8 Outstanding Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.9 Treasury Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.10 Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.11 Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.12 Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 2.13 CUSIP Numbers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE III
REDEMPTION
Section 3.1 Right of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 3.2 Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 3.3 Selection of Securities to Be Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 3.4 Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 3.5 Effect of Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 3.6 Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 3.7 Securities Redeemed in Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE IV
COVENANTS
Section 4.1 Payment of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.2 Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Section 4.3 Limitation on Restricted Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.4 Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.5 Payment of Taxes and Other Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.6 Compliance Certificate; Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.7 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.8 Waiver of Stay, Extension or Usury Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.9 Limitation on Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Section 4.10 Limitation on Incurrence of Additional Indebtedness and Disqualified Capital Stock . . . . . . . . . . . .
Section 4.11 Limitation on Dividends and Other Payment Restrictions Affecting Subsidiaries . . . . . . . . . . . . . . .
Section 4.12 Limitation on Liens Securing Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.13 Limitation on Sale of Assets and Subsidiary Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.14 Limitation on Layering Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.15 Limitation on Lines of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.16 Limitation on Status as Investment Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.17 Future Subsidiary Guarantors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.18 Limitation on Payment for Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 4.19 Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE V
SUCCESSOR CORPORATION
Section 5.1 Limitation on Merger, Sale or Consolidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 5.2 Successor Corporation Substituted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
Section 6.1 Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.2 Acceleration of Maturity Date; Rescission and Annulment. . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.3 Collection of Indebtedness and Suits for Enforcement by Trustee. . . . . . . . . . . . . . . . . . . . . . .
Section 6.4 Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.5 Trustee May Enforce Claims Without Possession of Securities. . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.6 Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.7 Limitation on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.8 Unconditional Right of Holders to Receive Principal, Premium and Interest. . . . . . . . . . . . . . . . . .
Section 6.9 Rights and Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.10 Delay or Omission Not Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.11 Control by Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.12 Waiver of Past Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.13 Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 6.14 Restoration of Rights and Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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ARTICLE VII
TRUSTEE
Section 7.1 Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.2 Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.3 Individual Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.4 Trustee's Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.5 Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.6 Reports by Trustee to Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.7 Compensation and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.8 Replacement of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.9 Successor Trustee by Merger, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.10 Eligibility; Disqualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 7.11 Preferential Collection of Claims Against Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.1 Option to Effect Legal Defeasance or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 8.2 Legal Defeasance and Discharge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 8.3 Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 8.4 Conditions to Legal or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 8.5 Deposited Cash and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions . . . . .
Section 8.6 Repayment to Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 8.7 Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1 Supplemental Indentures Without Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 9.2 Amendments, Supplemental Indentures and Waivers with Consent of Holders. . . . . . . . . . . . . . . . . . .
Section 9.3 Compliance with TIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 9.4 Revocation and Effect of Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 9.5 Notation on or Exchange of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 9.6 Trustee to Sign Amendments, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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ARTICLE X
RIGHT TO REQUIRE REPURCHASE
Section 10.1 Repurchase of Securities at Option of the Holder upon Change of Control . . . . . . . . . . . . . . . . . .
ARTICLE XI
GUARANTEES
Section 11.1 Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 11.2 Execution and Delivery of Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 11.3 Certain Bankruptcy Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 11.4 Limitation on Merger, Consolidation, Etc. of Guarantors. . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 11.5 Future Guarantors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE XII
SUBORDINATION
Section 12.1 Securities Subordinated to Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.2 No Payment on Securities in Certain Circumstances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.3 Securities Subordinated to Prior Payment of All Senior Indebtedness on Dissolution,
Liquidation or Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.4 Securityholders to Be Subrogated to Rights of Holders of Senior Indebtedness . . . . . . . . . . . . . . . .
Section 12.5 Obligations of the Company Unconditional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.6 Trustee Entitled to Assume Payments Not Prohibited in Absence of Notice. . . . . . . . . . . . . . . . . . .
Section 12.7 Application by Trustee of Assets Deposited with It . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.8 Subordination Rights Not Impaired by Acts or Omissions of the Company, Guarantors or Holders of
Senior Indebtedness, Etc.; Modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.9 Securityholders Authorize Trustee to Effectuate Subordination of Securities. . . . . . . . . . . . . . . . .
Section 12.10 Right of Trustee to Hold Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 12.11 Article XII Not to Prevent Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Section 12.12 No Fiduciary Duty of Trustee to Holders of Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE XIII
MISCELLANEOUS
Section 13.1 TIA Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.3 Communications by Holders with Other Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.4 Certificate and Opinion as to Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.5 Statements Required in Certificate or Opinion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.6 Rules by Trustee, Paying Agent, Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.7 Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.9 No Adverse Interpretation of Other Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.10 No Recourse Against Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.11 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.12 Duplicate Originals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.13 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 13.14 Table of Contents, Headings, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXHIBITS
Exhibit A - Form of Note
Exhibit B - Form of Guarantee
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INDENTURE, dated as of April 10, 1997, among UROHEALTH
Systems, Inc., a Delaware corporation (the "Company"), the Guarantors referred
to below and The Bank of New York, a New York banking corporation, as Trustee.
Each party hereto agrees as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Company's 12.5% Senior Subordinated Notes due 2004:
ARTICLE ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1 Definitions.
"Acceleration Notice" shall have the meaning specified in
Section 6.2.
"Acquired Indebtedness" means Indebtedness or Disqualified
Capital Stock of any Person existing at the time such Person (i) becomes a
Restricted Subsidiary of the Company including by designation, or (ii) is
merged or consolidated into or with the Company or one of its Restricted
Subsidiaries.
"Acquisition" means the purchase or other acquisition of any
Person or all or substantially all the assets of any Person by any other
Person, whether by purchase, merger, consolidation, or other transfer, and
whether or not for consideration.
"Affiliate" means any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company. For purposes of this definition, the term "control" means the
power to direct the management and policies of a Person, directly or through
one or more intermediaries, whether through the ownership of voting securities,
by contract, or otherwise. Notwithstanding the foregoing, an ownership
interest in the Company and its Subsidiaries by a Beneficial Owner of 10% or
more of the total voting power normally entitled to vote in the election of
directors, managers or trustees, as applicable, shall for such purposes be
deemed to constitute control.
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"Affiliate Transaction" shall have the meaning specified in
Section 4.9.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Asset Sale" shall have the meaning specified in Section 4.13.
"Asset Sale Offer" shall have the meaning specified in Section
4.13.
"Asset Sale Offer Amount" shall have the meaning specified in
Section 4.13.
"Asset Sale Offer Price" shall have the meaning specified in
Section 4.13.
"Average Life" means, as of the date of determination, with
respect to any security or instrument, the quotient obtained by dividing (i)
the sum of the products (a) the number of years from the date of determination
to the date or dates of each successive scheduled principal (or redemption)
payment of such security or instrument and (b) the amount of each such
respective principal (or redemption) payment by (ii) the sum of all such
principal (or redemption) payments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors.
"Beneficial Owner" or "beneficial owner" for purposes of the
definition of Change of Control has the meaning attributed to it in Rules 13d-3
and 13d-5 under the Exchange Act (as in effect on the Issue Date), whether or
not applicable, except that a "Person" shall be deemed to have "beneficial
ownership" of all shares that any such Person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time.
"Board of Directors" means, with respect to any Person, the
Board of Directors of such Person or any committee of the Board of Directors of
such Person authorized, with respect to any
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particular matter, to exercise the power of the Board of Directors of such
Person.
"Board Resolution" means, with respect to any Person, a duly
adopted resolution of the Board of Directors of such Person.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in New York, New
York are authorized or obligated by law or executive order to close.
"Capital Stock" means, with respect to any corporation, any
and all shares, interests, rights to purchase (other than convertible or
exchangeable Indebtedness that is not itself otherwise capital stock),
warrants, options, participations or other equivalents of or interests (however
designated) in stock issued by that corporation.
"Capitalized Lease Obligation" means rental obligations under
a lease that are required to be capitalized for financial reporting purposes in
accordance with GAAP, and the amount of Indebtedness represented by such
obligations shall be the capitalized amount of such obligations, as determined
in accordance with GAAP.
"Cash" or "cash" means such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public or private debts.
"Cash Equivalent" means (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits, bankers
acceptances, money market deposit accounts and certificates of deposit and
commercial paper issued by the parent corporation of any domestic commercial
bank of recognized standing having capital and surplus in excess of $500
million and commercial paper issued by others rated at least A-2 or the
equivalent thereof by Standard & Poor's Corporation or at least P-2 or the
equivalent thereof by Xxxxx'x Investors Service, Inc., and in the case of each
of (i), (ii) and (iii) maturing within one year after the
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date of acquisition and (iv) any fund investing exclusively in investments of
the types described in clauses (i) or (ii) above.
"Change of Control" means (i) any sale, transfer or other
conveyance, whether direct or indirect, of all or substantially all of the
assets, on a consolidated basis, of the Company, in one transaction or a series
of related transactions (in each case other than to a Restricted Subsidiary who
is a Guarantor); (ii) any merger or consolidation of the Company with or into
any Person (other than a Guarantor) if, immediately after giving effect to such
transaction, any "Person" or "group" (as such terms are used for purposes of
Sections 13(d) and 14(d) of the Exchange Act, whether or not applicable) (other
than a Guarantor) is or becomes the "beneficial owner," directly or indirectly,
of more than 50% of the total voting power in the aggregate normally entitled
to vote in the election of directors, managers, or trustees, as applicable, of
the surviving entity or entities; (iii) any "Person" or "group" (as such terms
are used for purposes of Sections 13(d) and 14(d) of the Exchange Act, whether
or not applicable) (other than a Guarantor) is or becomes the "beneficial
owner," directly or indirectly, of more than 50% of the total voting power in
the aggregate of all classes of Capital Stock of the Company then outstanding
normally entitled to vote in elections of directors; (iv) during any period of
12 consecutive months after the Issue Date, individuals who at the beginning of
any such 12-month period constituted the Board of Directors of the Company
(together with any new directors whose election by such Board or whose
nomination for election by the stockholders of the Company was approved by a
vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company then in office; or (v) the
adoption of a plan relating to the liquidation or dissolution of the Company.
"Change of Control Offer" shall have the meaning specified in
Section 10.1.
"Change of Control Offer Period" shall have the meaning
specified in Section 10.1.
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"Change of Control Purchase Date" shall have the meaning
specified in Section 10.1.
"Change of Control Purchase Price" shall have the meaning
specified in Section 10.1.
"Common Stock" means Common Stock of the Company, par value
$.001 per share.
"Consolidated Coverage Ratio" of any Person on any date of
determination (the "Transaction Date") means the ratio, on a pro forma basis,
of (i) the aggregate amount of Consolidated EBITDA of such Person for the
Reference Period to (ii) the aggregate Consolidated Fixed Charges of such
Person during the Reference Period; provided that for purposes of such
calculation, (a) Acquisitions which occurred during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date
shall be assumed to have occurred on the first day of the Reference Period, (b)
transactions giving rise to the need to calculate the Consolidated Coverage
Ratio shall be assumed to have occurred on the first day of the Reference
Period, (c) the incurrence of any Indebtedness or issuance of any Disqualified
Capital Stock during the Reference Period or subsequent to the Reference Period
and on or prior to the Transaction Date (and the application of the proceeds
therefrom to the extent used to refinance or retire other Indebtedness) shall
be assumed to have occurred on the first day of such Reference Period, and (d)
the Consolidated Fixed Charges of such Person attributable to interest on any
Indebtedness or dividends on any Disqualified Capital Stock bearing a floating
interest (or dividend) average rate shall be computed on a pro forma basis as
if the average rate in effect from the beginning of the Reference Period to the
Transaction Date had been the applicable rate for the entire period, unless
such Person or any of its Subsidiaries is a party to an Interest Swap or
Hedging Obligation (which shall remain in effect for the 12-month period
immediately following the Transaction Date) that has the effect of fixing the
interest rate on the date of computation, in which case such rate (whether
higher or lower) shall be used.
"Consolidated EBITDA" means, with respect to any Person, for
any period, the Consolidated Net Income of such Person for such period adjusted
to add thereto (to the extent
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deducted from net revenues in determining Consolidated Net Income), without
duplication, the sum of (i) consolidated income tax expense, (ii) consolidated
depreciation and amortization expense, provided that consolidated depreciation
and amortization of a Consolidated Subsidiary that is a less than wholly owned
Consolidated Subsidiary shall only be added to the extent of the equity
interest of the Company in such Consolidated Subsidiary, (iii) Consolidated
Fixed Charges, and (iv) non-recurring restructuring charges, write-off of
purchased research and development, and direct acquisition costs, less the
amount of all cash payments made by such Person or any of its Consolidated
Subsidiaries during such period to the extent such payments relate to non-cash
charges that were added back in determining Consolidated EBITDA for such period
or any prior period.
"Consolidated Fixed Charges" of any Person means, for any
period, the aggregate amount (without duplication and determined in each case
in accordance with GAAP) of (i) interest expensed or capitalized, paid,
accrued, or scheduled to be paid or accrued (including, in accordance with the
following sentence, interest attributable to Capitalized Lease Obligations) of
such Person and its Consolidated Subsidiaries during such period, including (a)
original issue discount and non-cash interest payments or accruals on any
Indebtedness, (b) the interest portion of all deferred payment obligations and
(c) all commissions, discounts and other fees and charges owed with respect to
bankers' acceptances and letters of credit financings and currency and Interest
Swap and Hedging Obligations, in each case to the extent attributable to such
period and (ii) all cash dividend payments (and non-cash dividend payments in
the case of a Person that is a Subsidiary) on any series of preferred stock of
such Person. For purposes of this definition, (1) interest on a Capitalized
Lease Obligation shall be deemed to accrue at an interest rate reasonably
determined in good faith by the Company to be the rate of interest implicit in
such Capitalized Lease Obligation in accordance with GAAP and (2) interest
expense attributable to any Indebtedness represented by the guaranty by such
Person or a Subsidiary of such Person of an obligation of another Person shall
be deemed to be the interest expense attributable to the Indebtedness
guaranteed.
"Consolidated Net Income" means, with respect to any Person
for any period, the net income (or loss) of such Person
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16
and its Consolidated Subsidiaries (determined on a consolidated basis in
accordance with GAAP) for such period, adjusted to exclude (only to the extent
included in computing such net income (or loss) and without duplication): (i)
all gains (but not losses) which are either extraordinary (as determined in
accordance with GAAP) or are either one-time nonrecurring (including any gain
from the sale or other disposition of assets outside the ordinary course of
business or from the issuance or sale of any capital stock), (ii) the net
income, if positive, of any Person, other than a Restricted Subsidiary, in
which such Person or any of its Consolidated Subsidiaries has an interest,
except to the extent of the amount of any dividends or distributions actually
paid in cash to such Person or a wholly owned Consolidated Subsidiary of such
Person during such period, but in any case not in excess of such Person's pro
rata share of such Person's net income for such period, (iii) the net income or
loss of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition, and (iv) the net income, if
positive, of any of such Person's Consolidated Subsidiaries to the extent that
the declaration or payment of dividends or similar distributions is not at the
time permitted by operation of the terms of its charter or bylaws or any other
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to such Consolidated Subsidiary and (v) all gains (but
not losses) attributable to operations and businesses permanently discontinued
or disposed of.
"Consolidated Net Worth" of any Person at any date means the
aggregate consolidated stockholders' equity of such Person (plus amounts of
equity attributable to preferred stock) and its Consolidated Subsidiaries, as
would be shown on the consolidated balance sheet of such Person prepared in
accordance with GAAP, adjusted to exclude (to the extent included in
calculating such equity), (i) the amount of any such stockholders' equity
attributable to Disqualified Capital Stock or treasury stock of such Person and
its Consolidated Subsidiaries, (ii) all upward revaluations and other write-ups
in the book value of any asset of such Person or a Consolidated Subsidiary of
such Person subsequent to the Issue Date, and (iii) all investments in
Subsidiaries that are not Consolidated Subsidiaries and in Persons that are not
Subsidiaries.
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"Consolidated Subsidiary" means, for any Person, each
Restricted Subsidiary of such Person (whether now existing or hereafter created
or acquired) the financial statements of which are consolidated for financial
statement reporting purposes with the financial statements of such Person in
accordance with GAAP.
"Consolidation," or "consolidation" means, with respect to the
Company, the consolidation of the accounts of the Subsidiaries with those of
the Company, all in accordance with GAAP; provided that "consolidation" will
not include consolidation of the accounts of any Unrestricted Subsidiary with
the accounts of the Company. The term "Consolidated" or "consolidated" has a
correlative meaning to the foregoing.
"Credit Agreement" means (i) the Amended and Restated
Revolving Credit Agreement to be dated as of April 10, 1997 by and among the
Company, certain of its subsidiaries, certain financial institutions and Banque
Indosuez, New York Branch, as agent, providing for an aggregate $50 million
revolving credit facility, including any related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith, as such
credit agreement and/or related documents may be amended, restated,
supplemented, renewed, replaced or otherwise modified from time to time whether
or not with the same agent, trustee, representative lenders or holders, and,
subject to the proviso to the next succeeding sentence, irrespective of any
changes in the terms and conditions thereof or (ii) any substantially
equivalent senior credit facility in lieu of the credit facility described in
clause (i). Without limiting the generality of the foregoing, the term "Credit
Agreement" shall include agreements in respect of Interest Swap and Hedging
Obligations with lenders party to the Credit Agreement and shall also include
any amendment, amendment and restatement, renewal, extension, restructuring,
supplement or modification to any Credit Agreement and all refundings,
refinancings and replacements of any Credit Agreement, including any agreement
(i) extending or shortening the maturity of any Indebtedness incurred
thereunder or contemplated thereby, (ii) adding or deleting borrowers or
guarantors thereunder, so long as borrowers and issuers include one or more of
the Company and its Subsidiaries and their respective successors and assigns,
(iii) increasing the amount of Indebtedness incurred thereunder or available to
be borrowed thereunder, provided that on the date such Indebtedness
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18
is incurred it would not exceed the amount permitted to be incurred by clause
(ii) of the definition of Permitted Indebtedness or (iv) otherwise altering the
terms and conditions thereof in a manner not prohibited by the terms hereof.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Debt Incurrence Ratio" shall have the meaning specified in
Section 4.10.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Definitive Securities" means Securities that are in the form
of the Note attached hereto as Exhibit A that do not include the information
called for by footnotes 1 and 3 thereof.
"Depository" means, with respect to the Securities issuable or
issued in whole or in part in global form, the Person specified in Section 2.3
as the Depository with respect to the Securities, until a successor shall have
been appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depository" shall mean or include such successor.
"Disqualified Capital Stock" means with respect to any Person
other than any Restricted Subsidiary of such Person, Equity Interests of such
Person that, by their terms or by the terms of any security into which they are
convertible or exercisable (in either case solely at the option of the holder
thereof), are, or upon the happening of an event or the passage of time would
be, required to be redeemed or repurchased (including at the option of the
holder thereof) by such Person or any of its Restricted Subsidiaries, in whole
or in part, on or prior to the Stated Maturity of the Securities and, with
respect to any Restricted Subsidiary of such Person (including with respect to
any Restricted Subsidiary of the Company), any Equity Interests other than any
common equity with no preference, privileges, or redemption or repayment
provisions.
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"Equity Interest" of any Person means any shares, interests,
participations or other equivalents (however designated) in such Person's
equity, and shall in any event include any Capital Stock issued by, or
partnership or membership interests in, such Person.
"Event of Default" shall have the meaning specified in Section
6.1.
"Event of Loss" means, with respect to any property or asset,
any (i) loss, destruction or damage of such property or asset or (ii) any
condemnation, seizure or taking, by exercise of the power of eminent domain or
otherwise, of such property or asset, or confiscation or requisition of the use
of such property or asset.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC thereunder.
"Exchange Offer" means the offer by the Company and the
Guarantors to exchange the Series B Notes and Guarantees thereof for the
Original Notes and Guarantees thereof made pursuant to the Registration Rights
Agreement.
"Exempt Affiliate Transactions" means (a) transactions between
or among the Company and/or the Guarantors, (b) reimbursement of or advances to
officers of the Company or any Subsidiary of the Company in the ordinary course
of business to provide for the payment of reasonable expenses incurred by such
persons in the performance of their responsibilities to the Company or such
Subsidiary or in connection with any relocation, (c) fees, compensation, and
employee benefits, including bonuses, retirement plans and stock options, paid
to and indemnity provided on behalf of directors, officers or employees of the
Company or any Subsidiary of the Company in the ordinary course of business,
provided that any such transaction in this clause (c) is approved by a majority
of the independent directors on the board of directors, (d) any employment or
consulting agreement that is in effect on the date of the Indenture and any
such agreement entered into by the Company or a Subsidiary of the Company after
the date of the Indenture in the ordinary course of business of the Company or
such Subsidiary, provided that any
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such agreement is approved by a majority of the independent directors on the
board of directors, (e) any Restricted Payment constituting a dividend or
distribution pro rata to all holders of the Company's Common Stock permitted by
the Indenture, and (f) repayment of Indebtedness owing to any Affiliate, if
such Indebtedness is permitted by the Indenture and such Indebtedness was
issued to an Affiliate by the Company or a Guarantor in compliance with Section
4.9 and Section 4.10.
"Existing Assets" means assets of the Company and its
Restricted Subsidiaries existing at the Issue Date (other than cash, Cash
Equivalents or inventory held for resale in the ordinary course of business)
and including proceeds of any sale of such assets and assets acquired in whole
or in part with proceeds from the sale from any such assets.
"Fair Market Value" or "fair market value" means, with respect
to any assets or properties, the amount at which such assets or properties
would be transferred between a willing buyer and a willing seller, within a
commercially reasonable time, each having reasonable knowledge of the relevant
facts, neither being under a compulsion to sell or buy, as such amount is
determined by (i) the Board of Directors of the Company acting reasonably and
in good faith or (ii) an appraisal or valuation firm of national or regional
standing selected by the Company, with experience in the appraisal or valuation
of properties or assets of the type for which value is being determined.
"GAAP" means United States generally accepted accounting
principles set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment
of the accounting profession in the United States as in effect on the Issue
Date.
"Global Security" means a Security that contains the paragraph
referred to in footnote 1 and the additional schedule referred to in footnote 3
to the form of Security attached hereto as Exhibit A.
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"Government Securities" means direct obligations of, or
obligations fully guaranteed by, or participations in pools consisting solely
of obligations of or obligations guaranteed by, the United States of America
for the payment of which obligations or guarantee the full faith and credit of
the United States of America is pledged.
"Guarantee" shall have the meaning provided in Section 11.1.
"Guarantor" means a Restricted Subsidiary that guarantees the
Notes in accordance with the terms of the Indenture.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered on the Registrar's books.
"incur" shall have the meaning specified in Section 4.10.
"Incurrence Date" shall have the meaning specified in Section
4.10.
"Indebtedness" of any Person means, without duplication, if
and to the extent any of the following (except as set forth below) would appear
as a liability upon a balance sheet of such Person prepared in accordance with
GAAP, (a) all liabilities and obligations, contingent or otherwise, of such
Person, (i) in respect of borrowed money (whether or not the recourse of the
lender is to the whole of the assets of such Person or only to a portion
thereof), (ii) evidenced by bonds, notes, debentures or similar instruments,
(iii) representing the balance deferred and unpaid of the purchase price of any
property, except those that would constitute ordinarily an accrued expense or a
trade payable to trade creditors, (iv) evidenced by bankers' acceptances or
similar instruments issued or accepted by banks, (v) relating to any
Capitalized Lease Obligation, or (vi) evidenced by a letter of credit or a
reimbursement obligation of such Person with respect to any letter of credit
(regardless of whether they appear as a liability upon a balance sheet of such
Person); (b) all net obligations of such Person under Interest Swap and Hedging
Obligations (regardless of whether they appear as a liability upon a balance
sheet of such Person); (c) all liabilities and obligations of others of the
kind described in the
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preceding clause (a) or (b) that such Person has guaranteed or that is
otherwise its legal liability or which are secured by any assets or property of
such Person and all obligations to purchase, redeem or acquire any Equity
Interests and (d) any and all deferrals, renewals, extensions, refinancing and
refundings (whether direct or indirect) of, or amendments, modifications or
supplements to, any liability of the kind described in any of the preceding
clauses (a), (b) or (c), or this clause (d), whether or not between or among
the same parties, and (e) all Disqualified Capital Stock of such Person
(measured at the greater of its voluntary or involuntary maximum fixed
repurchase price plus accrued and unpaid dividends). For purposes hereof, the
"maximum fixed repurchase price" of any Disqualified Capital Stock which does
not have a fixed repurchase price shall be calculated in accordance with the
terms of such Disqualified Capital Stock as if such Disqualified Capital Stock
were purchased on any date on which Indebtedness shall be required to be
determined pursuant to the Indenture, and if such price is based upon, or
measured by, the Fair Market Value of such Disqualified Capital Stock, such
Fair Market Value to be determined in good faith by the board of directors of
the issuer (or managing general partner of the issuer) of such Disqualified
Capital Stock.
"Indenture" means this Indenture, as amended or supplemented
from time to time in accordance with the terms hereof.
"Initial Purchaser" means Bear, Xxxxxxx & Co. Inc.
"Interest Payment Date" means the stated due date of an
installment of interest on the Securities.
"Interest Swap and Hedging Obligation" means any obligation of
any Person pursuant to any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate exchange agreement,
currency exchange agreement or any other agreement or arrangement designed to
protect against fluctuations in interest rates or currency values, including,
without limitation, any arrangement whereby, directly or indirectly, such
Person is entitled to receive from time to time periodic payments calculated by
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applying either a fixed or floating rate of interest on a stated notional
amount in exchange for periodic payments made by such Person calculated by
applying a fixed or floating rate of interest on the same notional amount.
"Investment" by any Person in any other Person means (without
duplication) (i) the acquisition (whether by purchase, merger, consolidation or
otherwise) by such Person (whether for cash, property, services, securities or
otherwise) of capital stock, bonds, notes, debentures, partnership or other
ownership interests or other securities, including any options or warrants, of
such other Person or any agreement to make any such acquisition; (ii) the
making by such Person of any deposit with, or advance, loan or other extension
of credit to, such other Person (including the purchase of property from
another Person subject to an understanding or agreement, contingent or
otherwise, to resell such property to such other Person) or any commitment to
make any such advance, loan or extension (but excluding accounts receivable or
deposits arising in the ordinary course of business); (iii) the entering into
by such Person of any guarantee of, or other credit support or contingent
obligation with respect to, Indebtedness or other liability of such other
Person, other than guarantees of Indebtedness of the Company or any Guarantor
to the extent permitted by Section 4.10; (iv) the making of any capital
contribution by such Person to such other Person; and (v) the designation by
the Board of Directors of the Company of any Person to be an Unrestricted
Subsidiary. The Company shall be deemed to make an Investment in an amount
equal to the Fair Market Value of the net assets of any subsidiary (or, if
neither the Company nor any of its Subsidiaries has theretofore made an
Investment in such subsidiary, in an amount equal to the Investments being
made), at the time that such subsidiary is designated an Unrestricted
Subsidiary, and any property transferred to an Unrestricted Subsidiary from the
Company or a Subsidiary shall be deemed an Investment valued at its Fair Market
Value at the time of such transfer.
"Issue Date" means the date of first issuance of the Notes
under the Indenture.
"Issuer" means each party named as such in this Indenture
until a successor replaces it pursuant to the Indenture and thereafter means
such successor.
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"Junior Security" means any Qualified Capital Stock and any
Indebtedness of the Company or a Guarantor, as applicable, that is subordinated
in right of payment to Senior Indebtedness at least to the same extent as the
Notes or the Guarantee, as applicable, and has no scheduled installment of
principal due, by redemption, sinking fund payment or otherwise, on or prior to
the Stated Maturity of the Notes.
"Legal Holiday" shall have the meaning provided in Section
13.7.
"Lien" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation or other encumbrance
upon or with respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired.
"Liquidated Damages" means all liquidated damages then owing
pursuant to the Registration Rights Agreement (as such term is therein
defined).
"Maturity Date," when used with respect to any Security, means
the date on which the principal of such Security becomes due and payable as
therein or herein provided, whether at Stated Maturity, a Change of Control
Purchase Date, a purchase date with respect to an Asset Sale Offer or by
declaration of acceleration, call for redemption or otherwise.
"Microsurge" means Microsurge, Inc., a Delaware corporation.
"Moody's" means Xxxxx'x Investor Services, Inc.
"Net Cash Proceeds" means the aggregate amount of Cash or Cash
Equivalents received by the Company in the case of a sale of Qualified Capital
Stock and by the Company and its Subsidiaries in respect of an Asset Sale plus,
in the case of an issuance of Qualified Capital Stock upon any exercise,
exchange or conversion of securities (including options, warrants, rights and
convertible or exchangeable debt) of the Company that were issued for cash on
or after the Issue Date, the amount of cash originally received by the Company
upon the issuance of such securities (including options, warrants, rights and
convertible or exchange-
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able debt) less, in each case, the sum of all payments, fees, commissions and
(in the case of Asset Sales, reasonable and customary) expenses (including,
without limitation, the fees and expenses of legal counsel and investment
banking fees and expenses) incurred in connection with such Asset Sale or sale
of Qualified Capital Stock, and, in the case of an Asset Sale only, less the
amount (estimated reasonably and in good faith by the Company) of income,
franchise, sales and other applicable taxes required to be paid by the Company
or any of its respective Subsidiaries in connection with such Asset Sale.
"Notes" See "Securities."
"Offering Memorandum" means the Offering Memorandum of the
Company dated April 3, 1997 with respect to the Securities.
"Officer" means, with respect to the Company, the Chairman of
the Board, the Chief Executive Officer, the President, any Vice President, the
Chief Financial Officer, the Treasurer, the Controller, or the Secretary or
Assistant Secretary.
"Officers' Certificate" means, with respect to the Company or
any Guarantor, a certificate signed by two Officers of the Company or such
Guarantor and otherwise complying with the requirements of Sections 13.4 and
13.5.
"Opinion of Counsel" means a written opinion from legal
counsel to the Company complying with the requirements of Sections 13.4 and
13.5. Unless otherwise required by this Indenture, the counsel may be in-house
counsel to the Company.
"Original Notes" means the 12.5% Senior Subordinated Notes due
2004, as amended and supplemented from time to time in accordance with the
terms hereof, that are issued pursuant to this Indenture.
"Paying Agent" shall have the meaning specified in Section
2.3.
"Permitted Indebtedness" means any of the following: (i)
Indebtedness evidenced by the Notes and the Guarantees and represented by the
Indenture up to the amounts specified therein
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as of the date hereof; (ii) Indebtedness incurred pursuant to the Credit
Agreement (with letters of credit being deemed to have a principal amount equal
to the maximum potential liability of the Company or the relevant Guarantor
thereunder) up to an aggregate amount outstanding (including any Indebtedness
issued to refinance, refund or replace such Indebtedness) at any time of $50
million, minus the amount of any such Indebtedness retired with Net Cash
Proceeds from any Asset Sale or assumed by a transferee in an Asset Sale; (iii)
Indebtedness by the Company to any Guarantor, and any Guarantor may incur
Indebtedness to any other Guarantor or to the Company; provided that, in the
case of Indebtedness of the Company, such obligations shall be unsecured and
subordinated in all respects to the Company's obligations pursuant to the
Notes; (iv) Refinancing Indebtedness with respect to any Indebtedness or
Disqualified Capital Stock, as applicable, described in clause (ii) of this
definition, incurred under the Debt Incurrence Ratio test set forth in Section
4.10, or which was outstanding on the Issue Date; (v) Indebtedness represented
by Capitalized Lease Obligations, mortgage financings or Purchase Money
Indebtedness, in each case incurred for the purpose of financing all or any
part of the purchase price or cost of construction or improvement of property,
plant or equipment used in the business of the Company or any Restricted
Subsidiary or any permitted Refinancing Indebtedness thereof (provided that the
requirements of clause (2)(A) of the definition of Refinancing Indebtedness
need not be met for the purposes of this clause (v)), in an aggregate principal
amount (including any Indebtedness issued to refinance, replace, or refund such
Indebtedness) not to exceed $10 million at any time outstanding; and (vi)
Indebtedness incurred in connection with the acquisition of assets or a new
Restricted Subsidiary; provided, that such Indebtedness was incurred by the
prior owner of such assets or such Restricted Subsidiary prior to such
acquisition by the Company or one of its Restricted Subsidiaries and was not
incurred in connection with, or in contemplation of, such acquisition by the
Company or one of its Restricted Subsidiaries and all such Indebtedness
(including any Indebtedness issued to refinance, replace, or refund such
Indebtedness) does not exceed an aggregate principal amount of $10 million at
any time outstanding; (vii) Indebtedness of the Company, any Guarantor or any
Restricted Subsidiary outstanding on the date of this Indenture; (viii)
Indebtedness of Microsurge existing on the Issue Date and disclosed in the
financial statements of Microsurge included in
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this Offering Memorandum incurred in connection with the acquisition of
Microsurge; (ix) Indebtedness which represents Interest Swap and Hedging
Obligations that are incurred for the purpose of fixing or hedging interest
rate risk with respect to any floating rate indebtedness that is permitted by
the terms of this Indenture to be outstanding and any currency exchange
agreement entered into to protect against fluctuations in currency values; and
(x) in addition to Indebtedness described in (i) through (ix) above,
Indebtedness in an aggregate amount outstanding at any time (including any
Indebtedness issued to refinance, replace, or refund such Indebtedness) of up
to $7.5 million.
"Permitted Investment" means (i) Investments in the Company or
in a Restricted Subsidiary of the Company (including, without limitation,
guarantees of the Indebtedness and/or other obligations of the Company and/or
any Restricted Subsidiary of the Company, so long as such Indebtedness and/or
other obligations are permitted under the Indenture), (ii) Investments in Cash
and Cash Equivalents, (iii) Investments by the Company or any Restricted
Subsidiary of the Company in, or the purchase of the securities of, a Person
if, as a result of such Investment, (a) such Person becomes a Restricted
Subsidiary of the Company or (b) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Company or a Restricted Subsidiary of the
Company, (iv) accounts receivable acquired in the ordinary course of business
and notes receivable acquired in consideration of the transfer to a third party
of capital equipment in the ordinary course of business, (v) any non-cash
consideration received (and any Investment made as a result of the receipt
thereof) in connection with an Asset Sale that complies with Section 4.13, (vi)
any Investment in an Unrestricted Subsidiary or in an entity in which the
Company or any Restricted Subsidiary has an Equity Interest together with one
or more other Persons, and which is formed after the date of the Indenture for
the purpose of engaging in a Related Business, provided that, at the date of
any such Investment is made and after giving effect thereto, such Investment,
together with all other such Investments by the Company and its Restricted
Subsidiaries since the Issue Date, does not exceed $10 million, (vii)
Investments in connection with Interest Swap and Hedging Obligations permitted
to be incurred under the definition "Permitted Indebtedness," and
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(viii) loans to employees not to exceed $1 million at any time outstanding.
"Permitted Lien" means (i) Liens existing on the Issue Date
(including, without limitation, Liens under the Credit Agreement); (ii) Liens
securing the Notes; (iii) Liens securing Indebtedness of a Person existing at
the time such Person becomes a Subsidiary or is merged with or into the Company
or a Restricted Subsidiary or Liens securing Indebtedness incurred in
connection with an Acquisition, provided that such Liens were in existence
prior to the date of such acquisition, merger or consolidation, were not
incurred in anticipation thereof, and do not extend to any other assets; (iv)
Liens securing Refinancing Indebtedness incurred to refinance any Indebtedness
that was previously secured in a manner no more adverse to the Holders of the
Notes than the terms of the Liens securing such refinanced Indebtedness,
provided that the Indebtedness secured is not increased and the Lien is not
extended to any additional assets or property, (v) Liens securing Indebtedness
permitted by clause (v) of the definition of "Permitted Indebtedness" covering
only the assets acquired with such Indebtedness, (vi) Liens securing Interest
Swap and Hedging Obligations of the Company and its Restricted Subsidiaries
that were permitted pursuant to the Indenture, (vii) Liens to secure the
performance of statutory obligations, surety or appeal bonds, performance bonds
or other obligations of a like nature incurred in the ordinary course of
business, (viii) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded, (ix)
Liens imposed by law, such as mechanics', carriers', warehousemen's,
materialmen's, and vendors' Liens, (x) judgment Liens to the extent that such
judgments do not cause of constitute a Default or an Event of Default, and (xi)
Liens in favor of the lessee on instruments which are the subject of leases
entered into in the ordinary course of business; provided that any such Lien
shall not extend to or cover any assets or property of the Company and its
Restricted Subsidiaries that is not the subject of any such lease.
"Person" means any individual, limited liability company,
corporation, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or government or other agency or political
subdivision thereof.
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"principal" of any Indebtedness (including the Securities)
means the principal of such Indebtedness plus any applicable premium, if any,
on such Indebtedness.
"Property" or "property" means any right or interest in or to
property or assets of any kind whatsoever, whether real, Personal or mixed and
whether tangible, intangible, contingent, indirect or direct.
"Public Equity Offering" means an underwritten offering of
Common Stock of the Company for cash pursuant to an effective registration
statement under the Securities Act as a consequence of which such Common Stock
of the Company is listed on a national securities exchange or quoted on the
national market system of the NASDAQ Stock Market.
"Purchase Money Indebtedness" means Indebtedness of the
Company or Guarantors to the extent that (i) such Indebtedness is incurred in
connection with the acquisition of specified assets and property (the "Subject
Assets") for the business of the Company or the Guarantors, including
Indebtedness which existed at the time of the acquisition of such Subject Asset
and was assumed in connection therewith; and (ii) Liens securing such
Indebtedness are limited to the Subject Asset.
"Qualified Capital Stock" means any Capital Stock of the
Company that is not Disqualified Capital Stock.
"Qualified Exchange" means any legal defeasance, redemption,
retirement, repurchase or other acquisition of Capital Stock or Indebtedness of
the Company issued on or after the Issue Date with the Net Cash Proceeds
received by the Company from the substantially concurrent sale of Qualified
Capital Stock or any exchange of Qualified Capital Stock for any Capital Stock
or Indebtedness of the Company issued on or after the Issue Date.
"Rating Agencies" means S&P and Xxxxx'x or any successor to
the respective rating agency businesses thereof.
"Record Date" means a Record Date specified in the Securities
whether or not such Record Date is a Business Day.
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"Redemption Date," when used with respect to any Security to
be redeemed, means the date fixed for such redemption pursuant to Article III
of this Indenture and Paragraph 5 in the form of Security.
"Redemption Price," when used with respect to any Security to
be redeemed, means the redemption price for such redemption set forth in
Paragraph 5 in the form of Security, which shall include in each case accrued
and unpaid interest with respect to such Security to the applicable Redemption
Date.
"Reference Period" with regard to any Person means (i) for any
Incurrence Date from and including April 1, 1997 through and including June 30,
1997, the fiscal quarter ended Xxxxx 00, 0000, (xx) for any Incurrence Date
from and including July 1, 1997 through and including September 30, 1997, the
two fiscal quarters ended June 30, 1997, (iii) for any Incurrence Date from and
including October 1, 1997 through and including December 31, 1997, the three
fiscal quarters ended September 30, 1997, and (iv) for any Incurrence Date
after December 31, 1997, the four full fiscal quarters for which financial
statements have been completed by the Company ended immediately preceding any
date upon which any determination is to be made pursuant to the terms of the
Notes or the Indenture (or, in each case such lesser period during which such
Person has been in existence).
"Refinancing Indebtedness" means Indebtedness or Disqualified
Capital Stock (i) issued in exchange for, or the proceeds from the issuance and
sale of which are used substantially concurrently to repay, redeem, defease,
refund, refinance, discharge or otherwise retire for value, in whole or in
part, or (ii) constituting an amendment, modification or supplement to, or a
deferral or renewal of ((i) and (ii) above are, collectively, a "Refinancing"),
any Indebtedness or Disqualified Capital Stock in a principal amount or, in the
case of Disqualified Capital Stock, liquidation preference, not to exceed
(after deduction of reasonable and customary fees and expenses incurred in
connection with the Refinancing) the lesser of (a) the principal amount or, in
the case of Disqualified Capital Stock, liquidation preference, of the
Indebtedness or Disqualified Capital Stock so Refinanced and (b) if such
Indebtedness being Refinanced was issued with an original issue discount, the
accreted value thereof (as determined in accordance with GAAP) at the time of
such Refinancing;
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provided, that (1) such Refinancing Indebtedness of any Subsidiary of the
Company shall only be used to Refinance outstanding Indebtedness or
Disqualified Capital Stock of such Subsidiary, (2) such Refinancing
Indebtedness shall (A) not have an Average Life shorter than the Indebtedness
or Disqualified Capital Stock to be so refinanced at the time of such
Refinancing and (B) in all respects, be no less subordinated or junior, if
applicable, to the rights of Holders of the Notes than was the Indebtedness or
Disqualified Capital Stock to be refinanced and (3) such Refinancing
Indebtedness shall have a final stated maturity or redemption date, as
applicable, no earlier than the final stated maturity or redemption date, as
applicable, of the Indebtedness or Disqualified Capital Stock to be so
refinanced.
"Registrar" shall have the meaning specified in Section 2.3.
"Registration Rights Agreement" means the Registration Rights
Agreement by and among the Company, the Guarantors and the Initial Purchaser,
dated as of the Issue Date.
"Related Business" means the business conducted (or proposed
to be conducted) by the Company and its Subsidiaries as of the Issue Date and
any and all businesses that in the good faith judgment of the Board of
Directors of the Company are materially complementary, incidental, ancillary or
related businesses.
"Representative" means Banque Indosuez or any successor or
successors thereto under the Credit Agreement.
"Restricted Investment" means, in one or a series of related
transactions, any Investment, other than investments in Cash Equivalents and
other Permitted Investments.
"Restricted Payment" means, with respect to any Person, (i)
the declaration or payment of any dividend or other distribution in respect of
Equity Interests of such Person or any parent or Restricted Subsidiary of such
Person, (ii) any payment on account of the purchase, redemption or other
acquisition or retirement for value of Equity Interests of such Person or any
Subsidiary or parent of such Person, (iii) any purchase, redemption, or other
acquisition or retirement for value of, any
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payment in respect of any defeasance of, any Subordinated Indebtedness,
directly or indirectly, by such Person or a parent or Restricted Subsidiary of
such Person prior to the scheduled maturity, any scheduled repayment of
principal, or scheduled sinking fund payment, as the case may be, of such
Indebtedness, other than with the proceeds from the substantially concurrent
sale of, or in exchange for, Refinancing Indebtedness and (iv) any Restricted
Investment by such Person; provided, that the term "Restricted Payment" does
not include (i) any dividend, distribution or other payment on or with respect
to Equity Interests to the extent payable solely in shares of Qualified Capital
Stock of such issuer, (ii) any dividend, distribution or other payment to the
Company, or to any of its wholly owned Restricted Subsidiaries, by the Company
or any of its Subsidiaries or (iii) the purchase, redemption or retirement by
the Company of shares of its Common Stock held by an employee or former
employee of the Company or any of its Restricted Subsidiaries issued pursuant
to any employee benefit plan, approved by the applicable board of directors, of
the Company or any of its Restricted Subsidiaries, up to an aggregate of $1
million during any 12-month period.
"Restricted Subsidiary" means, with respect to any Person, any
Subsidiary that is not an Unrestricted Subsidiary.
"S&P" means Standard and Poor's Ratings Group, a division of
the XxXxxx-Xxxx Companies, Inc.
"SEC" means the Securities and Exchange Commission.
"Securities" or "Notes" means, prior to the Exchange Offer,
the Original Notes, and after the Exchange Offer, the Original Notes (if any)
and the Series B Notes, in each case as amended or modified from time to time
in accordance with the terms hereof, issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"Securities Custodian" means the Trustee, as custodian with
respect to the Securities in global form, or any successor entity thereto.
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"Security Agreement" shall have the meaning set forth in
Section 4.19.
"Securityholder" See "Holder."
"Senior Indebtedness" of the Company or any Guarantor means
Indebtedness (including any monetary obligation in respect of the Credit
Agreement, and interest, whether or not allowable, accruing on Indebtedness
incurred pursuant to the Credit Agreement after the filing of a petition
initiating any proceeding under any bankruptcy, insolvency or similar law) of
the Company or such Guarantor arising under the Credit Agreement or that, by
the terms of the instrument creating or evidencing such Indebtedness, is
expressly designated Senior Indebtedness and made senior in right of payment to
the Notes or the applicable Guarantee; provided that in no event shall Senior
Indebtedness include (i) Indebtedness to any Subsidiary of the Company or any
officer, director or employee of the Company or any Subsidiary of the Company,
(ii) Indebtedness incurred in violation of the terms of the Indenture, (iii)
Indebtedness to trade creditors, (iv) Disqualified Capital Stock, (v)
Capitalized Lease Obligations, and (vi) any liability for taxes owed or owing
by the Company or such Guarantor.
"Series B Notes" means the Series B 12.5% Senior Subordinated
Notes due 2004, in substantially the form set forth on the Form of Note set
forth as Exhibit A hereto, to be issued pursuant to this Indenture in
connection with the Exchange Offer.
"Significant Subsidiary" shall have the meaning provided under
Regulation S-X under the Securities Act, as in effect on the Issue Date.
"Stated Maturity," when used with respect to any Note, means
April 1, 2004.
"Subordinated Indebtedness" means Indebtedness of the Company,
or a Guarantor that is subordinated in right of payment to the Notes or such
Guarantee, as applicable, in any respect or, has a stated maturity on (except
for the Notes) or after the Stated Maturity.
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"Subsidiary," with respect to any Person, means (i) a
corporation a majority of whose Equity Interest with voting power, under
ordinary circumstances, to elect directors is at the time, directly or
indirectly, owned by such Person, by such Person and one or more Subsidiaries
of such Person or by one or more Subsidiaries of such Person, (ii) any other
Person (other than a corporation) in which such Person, one or more
Subsidiaries of such Person, or such Person and one or more Subsidiaries of
such Person, directly or indirectly, at the date of determination thereof has
at least majority ownership interest, or (iii) a partnership in which such
Person or a Subsidiary of such Person is, at the time, a general partner and in
which such Person, directly or indirectly, at the date of determination thereof
has at least a majority ownership interest. Unless the context requires
otherwise, Subsidiary means each direct and indirect Subsidiary of the Company.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Sections 77aaa-77bbbb) as in effect on the date of the execution of this
Indenture, except as permitted in Section 9.3.
"Transfer Restricted Securities" means Securities that bear or
are required to bear the legend set forth in Section 2.6.
"Trustee" means the party named as such in this Indenture
until a successor replaces it in accordance with the provisions of this
Indenture and thereafter means such successor.
"Trust Officer" means any officer within the corporate trust
department (or any successor group) of the Trustee including any vice
president, assistant vice president, assistant secretary or any other officer
or assistant officer of the Trustee customarily performing functions similar to
those performed by the Persons who at that time shall be such officers, and
also means, with respect to a particular corporate trust matter, any other
officer of the corporate trust department (or any successor group) of the
Trustee to whom such trust matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
"Unrestricted Subsidiary" means any Subsidiary of the Company
that does not own any Capital Stock of, or own or hold any Lien on any property
of, the Company or any other Restricted
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Subsidiary of the Company and that at the time of determination shall be an
Unrestricted Subsidiary (as designated by the Board of Directors of the
Company); provided that (i) such subsidiary shall not engage, to any
substantial extent, in any line or lines of business activity other than a
Related Business, (ii) neither immediately prior thereto nor after giving pro
forma effect to such designation there would occur or continue to exist a
Default or Event of Default and (iii) immediately after giving pro forma effect
thereto, the Company could incur at least $1.00 of Indebtedness pursuant to the
Debt Incurrence Ratio in the first paragraph of Section 4.10. The Board of
Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary, provided that (i) no Default or Event of Default has
occurred and is continuing or will occur as a consequence thereof and (ii)
immediately after giving effect to such designation, on a pro forma basis, the
Company could incur at least $1.00 of Indebtedness pursuant to the Debt
Incurrence Ratio in the first paragraph of Section 4.10. Each such designation
shall be evidenced by filing with the Trustee a certified copy of the
resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing conditions.
"U.S. Government Obligations" means direct noncallable
obligations of, or noncallable obligations guaranteed by, the United States of
America for the payment of which obligation or guarantee the full faith and
credit of the United States of America is pledged.
"wholly owned Subsidiary" means a Subsidiary all the Equity
Interests of which are owned by the Company or one or more wholly owned
Subsidiaries of the Company, except for directors' qualifying shares.
Section 2 Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
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"indenture securities" means the Securities.
"indenture securityholder" means a Holder or a
Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means
the Trustee.
"obligor" on the indenture securities means the Company
and any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule and
not otherwise defined herein have the meanings assigned to them thereby.
Section 1.3 Rules of Construction.
Unless the context otherwise requires:
(i) a term has the meaning assigned to
it;
(ii) an accounting term not otherwise
defined has the meaning assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the
plural, and words in the plural include the singular;
(v) provisions apply to successive
events and transactions;
(vi) "herein," "hereof" and other words
of similar import refer to this Indenture as a whole
and not to any particular Article, Section or other
subdivision; and
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(vii) references to Sections or
Articles means reference to such Section or Article in this Indenture,
unless stated otherwise.
ARTICLE II
THE SECURITIES
Section 2.1 Form and Dating.
The Securities and the Trustee's certificate of
authentication, in respect thereof, shall be substantially in the form of
Exhibit A hereto which Exhibit is part of this Indenture. The Securities may
have notations, legends or endorsements required by law, stock exchange rule or
usage. The Company shall approve the form of the Securities and any notation,
legend or endorsement on them. Any such notations, legends or endorsements not
contained in the form of Security attached as Exhibit A hereto shall be
delivered in writing to the Trustee. Each Security shall be dated the date of
its authentication.
The terms and provisions contained in the form of Securities
shall constitute, and are hereby expressly made, a part of this Indenture and,
to the extent applicable, the Company and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.
Section 2.2 Execution and Authentication.
Two Officers shall sign, or one Officer shall sign and one
Officer shall attest to, the Securities for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Security was an Officer
at the time of such execution but no longer holds that office at the time the
Trustee authenticates the Security, the Security shall be valid nevertheless and
the Company shall nevertheless be bound by the terms of the Securities and this
Indenture.
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A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security,
but such signature shall be conclusive evidence that the Security has been
authenticated pursuant to the terms of this Indenture.
The Trustee shall authenticate the Original Notes for original
issue in the aggregate principal amount of up to $110,000,000 and shall
authenticate Series B Notes for original issue in the aggregate principal amount
of up to $110,000,000, in each case upon a written order of the Company in the
form of an Officers' Certificate; provided that such Series B Notes shall be
issuable only upon the valid surrender for cancellation of Original Notes of a
like aggregate principal amount in accordance with the Registration Rights
Agreement. The Officers' Certificate shall specify the amount of Securities to
be authenticated and the date on which the Securities are to be authenticated.
The aggregate principal amount of Securities outstanding at any time may not
exceed $110,000,000, except as provided in Section 2.7. Upon the written order
of the Company in the form of an Officers' Certificate, the Trustee shall
authenticate Securities in substitution of Securities originally issued to
reflect any name change of the Company.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company, any Affiliate of the Company
or any of their respective Subsidiaries.
Securities shall be issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof.
Section 3 Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough
of Manhattan, The City of New York, where Securities may be presented for
registration of transfer or for exchange ("Registrar") and an office or agency
in the Borough of Manhattan, The
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City of New York where Securities may be presented for payment ("Paying Agent")
and an office or agency where notices and demands to or upon the Company in
respect of the Securities may be served. The Company may act as Registrar or
Paying Agent, except that, for the purposes of Articles III, VIII, X and Section
4.13 neither the Company nor any Affiliate thereof shall act as Paying Agent.
The Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company may have one or more co-Registrars and one or more
additional Paying Agents. The term "Paying Agent" includes any additional Paying
Agent. The Company hereby initially appoint the Trustee as Registrar and Paying
Agent, and the Trustee hereby initially agrees so to act.
The Company shall enter into an appropriate written agency
agreement with any Agent not a party to this Indenture, which agreement shall
implement the provisions of this Indenture that relate to such Agent. The
Company shall promptly notify the Trustee in writing of the name and address of
any such Agent. If the Company fail to maintain a Registrar or Paying Agent, the
Trustee shall act as such.
The Company initially appoint The Depository Trust Company
("DTC") to act as Depository with respect to the Global Securities.
The Company initially appoint the Trustee to act as Securities
Custodian with respect to the Global Securities.
Section 2.4 Paying Agent to Hold Assets in Trust.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that each Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all assets held by the Paying Agent for the
payment of principal of, or interest (and Liquidated Damages, if any) on, the
Securities (whether such assets have been distributed to it by the Company or
any other obligor on the Securities), and shall notify the Trustee in writing of
any Default by the Company (or any other obligor on the Securities) in making
any such payment. If either the Company or any Subsidiary thereof acts as Paying
Agent, it shall segregate such assets and hold them as a separate trust fund for
the benefit of the Holders or the Trustee. The Company
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at any time may require a Paying Agent to distribute all assets held by it to
the Trustee and account for any assets disbursed and the Trustee may at any time
during the continuance of any payment Default, upon written request to a Paying
Agent, require such Paying Agent to distribute all assets held by it to the
Trustee and to account for any assets distributed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Company to the
Paying Agent, the Paying Agent (if other than the Company) shall have no further
liability for such assets.
Section 5 Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Holders. If the Trustee is not the Registrar, the Company shall
furnish to the Trustee on or before the third Business Day preceding each
Interest Payment Date and at such other times as the Trustee may request in
writing a list in such form and as of such date as the Trustee reasonably may
require of the names and addresses of Holders.
Section 6 Transfer and Exchange.
(a) When Definitive Securities are presented to
the Registrar or a co-Registrar with a request
(x) to register the transfer of such Definitive
Securities or
(y) to exchange such Definitive Securities for an
equal principal amount of Definitive Securities of
other authorized denominations,
the Registrar or co-Registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
provided, however, that the Definitive Securities surrendered for transfer or
exchange:
(i) shall be duly endorsed or accom-
panied by a written instrument of transfer in form reasonably
satisfactory to the Company and the Registrar or co-Registrar, duly
executed by the Holder
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thereof or his attorney duly authorized in
writing; and
(ii) in the case of Transfer Restricted
Securities that are Definitive Securities, shall be accompanied by the
following additional information and documents, as applicable:
(A) If such Transfer
Restricted Securities are being delivered to the Registrar by
a Holder for registration in the name of such Holder, without
transfer, a certification from such Holder to that effect (in
substantially the form set forth on the reverse of the
Security); or
(B) if such Transfer
Restricted Security is being transferred to a "qualified
institutional buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A under the
Securities Act, a certification to that effect (in the form
set forth on the reverse of the Security); or
(C) if such Transfer
Restricted Security is being transferred (i) pursuant to an
exemption from registration in accordance with Rule 144 or
Regulation S under the Securities Act, (ii) pursuant to an
effective registration statement under the Securities Act, or
(iii) in reliance on another exemption from the registration
requirements of the Securities Act, a certification to that
effect (in the form set forth on the reverse of the Security)
and in the case of (iii) above a transferee letter of
representation in substantially the form set forth in the
Offering Memorandum and in the case of (i), and (iii) above,
an Opinion of Counsel reasonably acceptable to the Company to
the effect that such transfer is in compliance with the
Securities Act.
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(b) Restrictions on Transfer of a Definitive
Security for a Beneficial Interest in a Global Security. A Definitive Security
may not be exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Registrar
of a Definitive Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Registrar, together with:
(i) if such Definitive Security is a
Transfer Restricted Security, a certification, substantially in the
form set forth on the reverse of the Security, that such Definitive
Security is being transferred to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act) in accordance with Rule
144A under the Securities Act; and
(ii) whether or not such Definitive
Security is a Transfer Restricted Security, written instructions
directing the Registrar to make, or to direct the Securities Custodian
to make, an endorsement on the Global Security to reflect an increase
in the aggregate principal amount of the Securities represented by the
Global Security,
then the Registrar shall cancel such Definitive Security and cause, or direct
the Securities Custodian to cause, in accordance with the standing instructions
and procedures existing between the Depository and the Securities Custodian, the
aggregate principal amount of Securities represented by the Global Security to
be increased accordingly. If no Global Securities are then outstanding, the
Company shall issue and the Trustee shall authenticate a new Global Security in
the appropriate principal amount.
(c) Transfer and Exchange of Global Securities.
The transfer and exchange of Global Securities or beneficial interests therein
shall be effected through the Depository, in accordance with this Indenture
(including the restrictions on transfer set forth herein) and the procedures of
the Depository therefor.
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(d) Transfer of a Beneficial Interest in a Global
Security for a Definitive Security.
(i) Any Person having a beneficial
interest in a Global Security may upon request exchange such beneficial
interest for a Definitive Security. Upon receipt by the Trustee of
written instructions or such other form of instructions as is customary
for the Depository from the Depository or its nominee on behalf of any
Person having a beneficial interest in a Global Security and upon
receipt by the Trustee of a written order or such other form of
instructions as is customary for the Depository or the Person
designated by the Depository as having such a beneficial interest in a
Transfer Restricted Security only, the following additional information
and documents (all of which may be submitted by facsimile):
(A) if such beneficial
interest is being transferred to the Person designated by the
Depository as being the beneficial owner, a certification from
such Person to that effect (in substantially the form set
forth on the reverse of the Security); or
(B) if such beneficial
interest is being transferred to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act) in
accordance with Rule 144A under the Securities Act, a
certification to that effect from the transferor (in the form
set forth on the reverse of the Security); or
(C) if such beneficial
interest is being transferred (i) pursuant to an exemption
from registration in accordance with Rule 144 or Regulation S
under the Securities Act, (ii) pursuant to an effective
registration statement under the Securities Act, or (iii) in
reliance on another exemption from the registration
requirements of
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the Securities Act, a certification to that effect from the
transferee or transferor (in the form set forth on the reverse
of the Security) and in the case of (iii) above a transferee
letter of representation in substantially the form set forth
in the Offering Memorandum and in the case of (i), and (iii)
above, an Opinion of Counsel reasonably acceptable to the
Company to the effect that such transfer is in compliance with
the Securities Act,
then the Registrar or the Securities Custodian, at the direction of the Trustee,
will cause, in accordance with the standing instructions and procedures existing
between the Depository and the Securities Custodian, the aggregate principal
amount of the Global Security to be reduced and, following such reduction, the
Company will execute and the Trustee will authenticate and deliver to the
transferee a Definitive Security in the appropriate principal amount.
(ii) Definitive Securities issued in
exchange for a beneficial interest in a Global Security pursuant to
this Section 2.6(d) shall be registered in such names and in such
authorized denominations as the Depository, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct
the Trustee. The Registrar shall deliver such Definitive Securities to
the Persons in whose names such Securities are so registered.
(e) Restrictions on Transfer and Exchange of
Global Securities. Notwithstanding any other provisions of this Indenture (other
than the provisions set forth in subsection (f) of this Section 6), a Global
Security may not be transferred as a whole except by the Depository to a nominee
of the Depository or by a nominee of the Depository to the Depository or another
nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
(f) Authentication of Definitive Securities in
Absence of Depository. If at any time:
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(i) the Depository for the Securities
notifies the Company that the Depository is unwilling or unable to
continue as Depository for the Global Securities and a successor
Depository for the Global Securities is not appointed by the Company
within 90 days after delivery of such notice; or
(ii) the Company, in its sole discre-
tion, notifies the Trustee in writing that it elects to cause the
issuance of Definitive Securities under this Indenture,
then the Company will execute, and the Trustee, upon receipt of an Officers'
Certificate requesting the authentication and delivery of Definitive Securities,
will authenticate and make available for delivery Definitive Securities, in an
aggregate principal amount equal to the principal amount of the Global
Securities, in exchange for such Global Securities.
(g) Legends. Each Security certificate evidenc-
ing the Global Securities and the Definitive Securities (and all Securities
issued in exchange therefor or substitution thereof) shall bear a legend in
substantially the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED
HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS
HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE
SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (1)(a) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN
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A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE
SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904
UNDER THE SECURITIES ACT, or (d) IN ACCORDANCE WITH ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT (AND BASED IN THE CASE OF (b), (c) AND (d) UPON AN OPINION
OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE
SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH
IN (A) ABOVE."
(h) Cancellation and/or Adjustment of Global
Security. At such time as all beneficial interests in a Global Security have
either been exchanged for Definitive Securities, redeemed, repurchased or
cancelled, such Global Security shall be returned to or retained and cancelled
by the Trustee. At any time prior to such cancellation, if any beneficial
interest in a Global Security is exchanged for Definitive Securities, redeemed,
repurchased or cancelled, the principal amount of Securities represented by such
Global Security shall be reduced and an endorsement shall be made on such Global
Security, by the Trustee or the Securities Custodian, at the direction of the
Trustee, to reflect such reduction.
(i) Obligations with respect to Transfers and
Exchanges of Definitive Securities.
(i) To permit registrations of trans-
fers and exchanges, the Company shall execute and the Trustee shall
authenticate Definitive Securities and Global Securities at the
Registrar's or co-Registrar's
request.
(ii) No service charge shall be made
for any registration of transfer or exchange, but the
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Company may require payment of a sum sufficient to cover any transfer
tax, assessments, or similar governmental charge payable in connection
therewith (other than any such transfer taxes, assessments, or similar
governmental charge payable upon exchanges or transfers pursuant to
Section 2.2, 2.10, 3.6, 4.13, 9.5 or 10.1).
(iii) Except for a redemption of Secu-
rities pursuant to Section 3.2, the Registrar or co-Registrar shall not
be required to register the transfer of or exchange of (a) any
Definitive Security selected for redemption in whole or in part
pursuant to Article III, except the unredeemed portion of any
Definitive Security being redeemed in part, or (b) any Security for a
period beginning 15 days before the mailing of a notice of an offer to
repurchase pursuant to Article X or Section 13 hereof or a notice of
redemption of Securities pursuant to Article III hereof and ending at
the close of business on the day of such mailing.
(iv) The Trustee shall have no obliga-
tion or duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Indenture or under
applicable law with respect to any transfer of any interest in any
Security other than to require delivery of such certificates and other
documentation or evidence as expressly required
by, and to do so if and when expressly required by the terms of, this
Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
(v) The Registrar or co-Registrar shall
not be required to register the transfer of or exchange of (a) any
Definitive Security selected for redemption in whole or in part
pursuant to Article III, except the unredeemed portion of any
Definitive Security being redeemed in part, or (b) any Security for a
period beginning 15 Business Days before the mailing of a notice of an
offer to repurchase pursuant to Article X or Section 13 hereof or the
mailing of a notice of redemption of Securities pursuant to Article III
hereof
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and ending at the close of business on the day of such mailing.
Section 2.7 Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if
the Holder of a Security claims and submits an affidavit or other evidence,
satisfactory to the Trustee, to the Trustee to the effect that the Security has
been lost, destroyed or wrongfully taken, the Company shall issue and the
Trustee shall authenticate a replacement Security if the Trustee's requirements
are met. If required by the Trustee or the Company, such Holder must provide an
indemnity bond or other indemnity, sufficient in the judgment of both the
Company and the Trustee, to protect the Company, the Trustee or any Agent from
any loss which any of them may suffer if a Security is replaced. The Company may
charge such Holder for its reasonable, out-of-pocket expenses in replacing a
Security.
Every replacement Security is an additional obligation of the
Company.
Section 2.8 Outstanding Securities.
Securities outstanding at any time are all the Securities that
have been authenticated by the Trustee except those cancelled by it, those
delivered to it for cancellation, those reductions in the interest in a Global
Security effected by the Trustee hereunder and those described in this Section
2.8 as not outstanding. A Security does not cease to be outstanding because the
Company or an Affiliate of the Company holds the Security, except as provided in
Section 2.9.
If a Security is replaced pursuant to Section 2.7 (other than
a mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section 2.7.
If on a Redemption Date or the Maturity Date the Paying Agent
(other than the Company or an Affiliate of the Company)
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holds cash sufficient to pay all of the principal and interest (and Liquidated
Damages, if any) due on the Securities payable on that date and payment of the
Securities called for redemption is not otherwise prohibited, then on and after
that date such Securities cease to be outstanding and interest on them ceases to
accrue.
Section 9 Treasury Securities.
In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, amendment, supplement,
waiver or consent, Securities owned by the Company, any Guarantor and Affiliates
of the Company or of any Guarantor shall be disregarded, except that, for the
purposes of determining whether the Trustee shall be protected in relying on any
such direction, amendment, supplement, waiver or consent, only Securities that a
Trust Officer of the Trustee actually knows are so owned shall be disregarded.
Section 10 Temporary Securities.
Until definitive Securities are ready for delivery, the
Company may prepare, the Guarantors shall endorse and the Trustee shall
authenticate temporary Securities. Temporary Securities shall be substantially
in the form of definitive Securities but may have variations that the Company
reasonably and in good faith consider appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare, the Guarantors shall
endorse and the Trustee shall authenticate definitive Securities in exchange for
temporary Securities. Until so exchanged, the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture as permanent
Securities authenticated and delivered hereunder.
Section 11 Cancellation.
The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent (other than the Company or an Affiliate of the Company), and no one else,
shall cancel and, at the written direction of the
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Company, shall dispose of all Securities surrendered for transfer, exchange,
payment or cancellation in accordance with its customary procedures. Subject to
Section 7, the Company may not issue new Securities to replace Securities it has
paid or delivered to the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section 11, except as expressly permitted in the form of Securities and
as permitted by this Indenture.
Section 12 Defaulted Interest.
If the Company defaults in a payment of interest (or
Liquidated Damages, if any) on the Securities, the Company shall pay the
defaulted interest (and Liquidated Damages, if any), plus (to the extent lawful)
interest on the defaulted interest (and Liquidated Damages, if any), to the
Persons who are Holders on a Record Date (or at the Company' option a subsequent
special record date) which date shall be the fifteenth day next preceding the
date fixed by the Company for the payment of defaulted interest, whether or not
such day is a Business Day, unless the Trustee fixes another record date. At
least 15 days before the subsequent special record date, the Company shall mail
to each Holder with a copy to the Trustee a notice that states the subsequent
special record date, the payment date and the amount of defaulted interest (and
Liquidated Damages, if any), and interest payable on such defaulted interest
(and Liquidated Damages), if any, to be paid.
Section 13 CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the CUSIP numbers.
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ARTICLE III
REDEMPTION
Section 1 Right of Redemption.
Redemption of Securities shall be made only in accordance with
this Article III. The Notes will be redeemable for cash at the option of the
Company, in whole or in part, at any time on or after April 1, 2001, at the
Redemption Prices specified under the caption "Redemption," in the Form of Note
attached as Exhibit A hereto, plus accrued and unpaid interest and Liquidated
Damages, if any thereon to the Redemption Date. Except as provided in this
paragraph, the next following paragraph, Section 2 and paragraph 5 of the
Notes, the Notes may not otherwise be redeemed at the option of the Company.
Until April 1, 2000, upon a Public Equity Offering of common
stock resulting in Net Cash Proceeds to the Company of at least $40 million, up
to 35% of the original aggregate principal amount of the Notes may be redeemed
at the option of the Company within 120 days of such Public Equity Offering, on
not less than 30 days, but not more than 60 days, notice to each Holder of the
Notes to be redeemed, with cash from the Net Cash Proceeds of such Public Equity
Offering, at a redemption price equal to 112 1/2% of the principal amount
thereof (subject to the right of Holders of record on a Record Date to receive
interest due on an Interest Payment Date that is on or prior to such Redemption
Date), together with accrued and unpaid interest and Liquidated Damages, if any
to the date of redemption; provided, however, that immediately following each
such redemption, not less than 65% of the original aggregate principal amount of
the Notes remain outstanding.
Section 2 Notices to Trustee.
If the Company elect to redeem Securities pursuant to this
Article III, they shall notify the Trustee in writing of the date on which the
Notes are to be redeemed ("Redemption Date") and the principal amount of
Securities to be redeemed and whether they want the Trustee to give notice of
redemption to the Holders in the name of and at the expense of the Company.
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If the Company elect to reduce the principal amount of
Securities to be redeemed pursuant to Paragraph 5 of the Securities by crediting
against any such redemption Securities it has not previously delivered to the
Trustee for cancellation, it shall so notify the Trustee of the amount of the
reduction and deliver such Securities with such notice.
The Company shall give each notice to the Trustee provided for
in this Section 2 at least 45 days (unless a shorter period is acceptable to
the Trustee) before the Redemption Date.
Section 3 Selection of Securities to Be Redeemed.
If less than all of the Securities are to be redeemed pursuant
to Paragraph 5 thereof, the Trustee shall select from among such Securities to
be redeemed pro rata or by lot or by such other method as the Trustee shall
determine to be fair and appropriate and in such manner as complies with any
applicable legal and stock exchange requirements.
The Trustee shall make the selection from the Securities
outstanding and not previously called for redemption and shall promptly notify
the Company in writing of the Securities selected for redemption and, in the
case of any Security selected for partial redemption, the principal amount
thereof to be redeemed. Securities in denominations of $1,000 may be redeemed
only in whole. The Trustee may select for redemption portions (equal to $1,000
or any integral multiple thereof) of the principal of Securities that have
denominations larger than $1,000. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption.
Section 4 Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption
Date, the Company shall mail a notice of redemption by first class mail, postage
prepaid, to each Holder whose Securities are to be redeemed. At the Company's
request, the Trustee shall give the notice of redemption in the Company's name
and at the Company's expense. Each notice for redemption shall identify the
Securities to be redeemed and shall state:
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(1) the Redemption Date;
(2) the Redemption Price, including the amount of accrued but
unpaid interest (and Liquidated Damages, if any) to be paid upon such
redemption;
(3) the name, address and telephone number of the Paying Agent;
(4) that Securities called for redemption must be surrendered to
the Paying Agent at the address specified in such notice to collect the
Redemption Price;
(5) that, unless (a) the Company default in its obligation to
deposit cash with the Paying Agent in accordance with Section 6 hereof, interest
on Securities called for redemption ceases to accrue on and after the Redemption
Date and the only remaining right of the Holders of such Securities is to
receive payment of the Redemption Price, including accrued but unpaid interest
(and Liquidated Damages, if any), upon surrender to the Paying Agent of the
Securities called for redemption and to be redeemed;
(6) if any Security is being redeemed in part, the portion of
the principal amount, equal to $1,000 or any integral multiple thereof, of such
Security to be redeemed and that, after the Redemption Date, and upon surrender
of such Security, a new Security or Securities in aggregate principal amount
equal to the unredeemed portion thereof will be issued;
(7) if less than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be redeemed,
as well as the aggregate principal amount of such Securities to be redeemed and
the aggregate principal amount of Securities to be outstanding after such
partial redemption;
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(8) the CUSIP number of the Securities to be redeemed; and
(9) that the notice is being sent pursuant to this Section
4 and pursuant to the optional redemption provisions of Paragraph 5 of
the Securities.
Section 5 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section
3.5, Securities called for redemption become due and payable on the Redemption
Date and at the Redemption Price, including accrued but unpaid interest (and
Liquidated Damages, if any). Upon surrender to the Trustee or Paying Agent, such
Securities called for redemption shall be paid at the Redemption Price,
including interest (and Liquidated Damages, if any), if any, accrued to and
unpaid on the Redemption Date; provided that if the Redemption Date is after a
regular Record Date and on or prior to the Interest Payment Date, the accrued
interest (and Liquidated Damages, if any) shall be payable to the Holder of the
redeemed Securities registered on the relevant Record Date; and provided,
further, that if a Redemption Date is a Legal Holiday, payment shall be made on
the next succeeding Business Day and no interest shall accrue for the period
from such Redemption Date to such succeeding Business Day.
Section 6 Deposit of Redemption Price.
On or before the Redemption Date, the Company shall deposit
with the Paying Agent (other than the Company or an Affiliate of the Company)
cash sufficient to pay the Redemption Price of, including accrued but unpaid
interest on (and Liquidated Damages, if any), all Securities to be redeemed on
such Redemption Date (other than Securities or portions thereof called for
redemption on that date that have been delivered by the Company to the Trustee
for cancellation). The Paying Agent shall promptly return to the Company any
cash so deposited which is not required for that purpose upon the written
request of the Company.
If the Company complies with the preceding paragraph and the
other provisions of this Article III and payment of the
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Securities called for redemption is not otherwise prohibited, interest on the
Securities to be redeemed will cease to accrue on the applicable Redemption
Date, whether or not such Securities are presented for payment. Notwithstanding
anything herein to the contrary, if any Security surrendered for redemption in
the manner provided in the Securities shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
paragraph and the other provisions of this Article III, interest shall continue
to accrue and be paid from the Redemption Date until such payment is made on the
unpaid principal, and, to the extent lawful, on any interest not paid on such
unpaid principal, in each case at the rate and in the manner provided in Section
4.1 hereof and the Securities.
Section 7 Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part,
the Company shall execute and the Trustee shall authenticate and deliver to the
Holder, without service charge, a new Security or Securities equal in principal
amount to the unredeemed portion of the Security surrendered.
ARTICLE IV
COVENANTS
Section 1 Payment of Securities.
The Company shall pay the principal of and interest (and
Liquidated Damages, if any) on the Securities on the dates and in the manner
provided in the Securities and this Indenture. An installment of principal of or
interest (and Liquidated Damages, if any) on the Securities shall be considered
paid on the date it is due if the Trustee or Paying Agent (other than the
Company or an Affiliate of the Company) holds for the benefit of the Holders, on
or before 10:00 a.m. New York City time on that date, cash deposited and
designated for and sufficient to pay the installment.
The Company shall pay interest on overdue principal and on
overdue installments of interest (and Liquidated Damages, if
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any) at the rate specified in the Securities compounded semi-annually, to the
extent lawful.
Section 2 Maintenance of Office or Agency.
The Company and the Guarantors shall maintain in the Borough
of Manhattan, The City of New York, an office or agency where Securities may be
presented or surrendered for payment, where Securities may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Company and the Guarantors in respect of the Securities and this Indenture
may be served. The Company and the Guarantors shall give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency. If at any time the Company and the Guarantors shall fail to maintain
any such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the address of the Trustee set forth in Section 13.2.
The Company and the Guarantors may also from time to time
designate one or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company and the Guarantors of their
obligation to maintain an office or agency in the Borough of Manhattan, The City
of New York, for such purposes. The Company and the Guarantors shall give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency. The Company and the
Guarantors hereby initially designate the principal corporate trust office of
the Trustee as such office.
Section 3 Limitation on Restricted Payments.
The Company and the Guarantors will not, and will not permit
any of their Subsidiaries to, directly or indirectly, make any Restricted
Payment if, after giving effect to such Restricted Payment on a pro forma basis,
(i) a Default or an Event of Default shall have occurred and be continuing, (ii)
the Company is not permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Debt Incurrence Ratio contained in Section
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4.10, or (iii) the aggregate amount of all Restricted Payments made by the
Company and its Restricted Subsidiaries, including after giving effect to such
proposed Restricted Payment, from and after the Issue Date, would exceed the sum
of (a) 50% of the aggregate Consolidated Net Income of the Company for the
period (taken as one accounting period) commencing on the first day of the first
full fiscal quarter commencing after the Issue Date, to and including the last
day of the fiscal quarter ended immediately prior to the date of such Restricted
Payment (or, in the event Consolidated Net Income for such period is a deficit,
then minus 100% of such deficit), plus (b) the aggregate Net Cash Proceeds
received by the Company from the sale of its Qualified Capital (and Liquidated
Damages, if Stock (other than (1) to a Restricted Subsidiary of the Company and
(2) to the extent applied in connection with a Qualified Exchange), after the
Issue Date.
The immediately preceding paragraph, however, will not
prohibit (i) a Qualified Exchange, (ii) the payment of any dividend (a) on
Qualified Capital Stock within 60 days after the date of its declaration if such
dividend could have been made on the date of such declaration in compliance with
the foregoing provisions or (b) to minority shareholders of any Subsidiary on a
pro rata basis, (iii) the redemption of the Series A Preferred Stock of
Urohealth, Inc. (California), for total consideration of not more than $1.6
million on or before June 30, 1997 or (iv) the redemption of the Microsurge
convertible subordinated notes outstanding on the Issue Date prior to maturity
in an amount not to exceed $6.0 million. The full amount of any Restricted
Payment made pursuant to the foregoing clause (ii) of the immediately preceding
sentence, however, will be deducted (without duplication) in the calculation of
the aggregate amount of Restricted Payments available to be made referred to in
clause (iii) of the immediately preceding paragraph.
Section 4 Corporate Existence.
Subject to Article V, the Company and the Guarantors shall do
or cause to be done all things necessary to preserve and keep in full force and
effect their corporate existence and the corporate or other existence of each of
their Subsidiaries in accordance with the respective organizational documents of
each of them and the rights (charter and statutory) and corporate franchises of
the Company and the Guarantors and each of their
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Subsidiaries; provided, however, that neither the Company nor any of the
Guarantors shall be required to preserve, with respect to itself, any right or
franchise, and with respect to any of their Subsidiaries, any such existence,
right or franchise, if (a) the Board of Directors of the Company shall determine
reasonably and in good faith that the preservation thereof is no longer
desirable in the conduct of the business of the Company and (b) the loss thereof
is not disadvantageous in any material respect to the Holders.
Section 5 Payment of Taxes and Other Claims.
The Company and the Guarantors shall, and shall cause each of
their Subsidiaries to, pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon the Company, any Guarantor or any
of their Subsidiaries or properties and assets of the Company, any Guarantor or
any of their Subsidiaries and (ii) all lawful claims, whether for labor,
materials, supplies, services or anything else, which have become due and
payable and which by law have or may become a Lien upon the property and assets
of the Company, any Guarantor or any of their Subsidiaries; provided, however,
that neither the Company nor any Guarantor shall be required to pay or discharge
or cause to be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which disputed amounts adequate reserves have
been established in accordance with GAAP.
Section 6 Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee
within 120 days after the end of its fiscal year an Officers' Certificate, one
of the signers of which shall be the principal executive, financial or
accounting officer of the Company, complying (whether or not required) with
Section 314(a)(4) of the TIA and stating that a review of its activities and the
activities of its Subsidiaries during the preceding fiscal year has been made
under the supervision of the signing Officers with a view to determining whether
the Company has kept, observed, performed and fulfilled its obligations (without
regard to notice requirements
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or grace periods) under this Indenture and further stating, as to each such
Officer signing such certificate, whether or not the signer knows of any failure
by the Company, any Guarantor or any Subsidiary of the Company or any Guarantor
to comply with any conditions or covenants in this Indenture and, if such signer
does know of such a failure to comply, the certificate shall describe such
failure with particularity. The Officers' Certificate shall also notify the
Trustee should the relevant fiscal year end on any date other than the current
fiscal year end date.
(b) So long as not contrary to the then current
recommendation of the American Institute of Certified Public Accountants, the
Company shall deliver to the Trustee within 120 days after the end of each of
its fiscal years a written report of a firm of independent certified public
accountants with an established national reputation stating that in conducting
their audit for such fiscal year, nothing has come to their attention that
caused them to believe that the Company or any Subsidiary of the Company were
not in compliance with the provisions set forth in Section 3, 4.10 or 4.13 or
Article X of this Indenture.
(c) The Company shall, so long as any of the
Securities are outstanding, deliver to the Trustee, immediately upon becoming
aware of any Default or Event of Default under this Indenture, an Officers'
Certificate specifying such Default or Event of Default and what action the
Company are taking or propose to take with respect thereto. The Trustee shall
not be deemed to have knowledge of a Default or an Event of Default unless one
of its Trust Officers receives notice of the Default giving rise thereto from
the Company or any of the Holders.
Section 7 Reports.
Whether or not the Company is subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company shall
deliver to the Trustee and to each Holder and to prospective purchasers of Notes
identified to the Company by the Initial Purchaser, within 15 days after it is
or would have been (if it were subject to such reporting obligations) required
to file such with the SEC, annual and quarterly financial statements
substantially equivalent to financial statements that would have been included
in reports filed with the SEC, if the Company were subject to the requirements
of Section 13 or 15(d) of the Ex-
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change Act, including, with respect to annual information only, a report thereon
by the Company's certified independent public accountants as such would be
required in such reports to the SEC, and, in each case, together with a
management's discussion and analysis of financial condition and results of
operations which would be so required and, to the extent permitted by the
Exchange Act or the SEC (if it were subject to such reporting obligations), file
with the SEC the annual, quarterly and other reports which it is or would have
been required to file with the SEC. Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
Section 8 Waiver of Stay, Extension or Usury Laws.
The Company and each Guarantor covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law wherever enacted which would
prohibit or forgive the Company or any Guarantor from paying all or any portion
of the principal of or interest (and Liquidated Damages, if any) on the
Securities as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of this
Indenture; and (to the extent that they may lawfully do so) the Company and each
Guarantor hereby expressly waives all benefit or advantage of any such law
insofar as such law applies to the Securities, and covenant that it shall not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
Section 9 Limitation on Transactions with Affiliates.
Neither the Company nor any of its Subsidiaries will be
permitted on or after the Issue Date to enter into any contract, agreement,
arrangement or transaction with any Affiliate (an "Affiliate Transaction"), or
any series of related Affiliate Transactions, other than Exempt Affiliate
Transactions unless (i)
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it is determined that the terms of such Affiliate Transaction are fair and
reasonable to the Company, and no less favorable to the Company, than could have
been obtained in an arm's-length transaction with a non-Affiliate, (ii) if the
consideration to any party is in excess of $500,000, such Affiliate
Transaction(s) is evidenced by an Officers' Certificate addressed and delivered
to the Trustee certifying that such Affiliate Transaction (or Transactions) has
been approved by a majority of the members of the Board of Directors that are
disinterested in such transaction and (iii) if the consideration to any party is
in excess of $5 million, the Company shall have obtained, prior to the
consummation thereof, a written favorable opinion as to the fairness of such
transaction to the Company from a financial point of view from an independent
financial advisor of national standing.
Section 10 Limitation on Incurrence of Additional
Indebtedness and Disqualified Capital Stock.
Except as set forth below in this Section 10, the Company
and the Guarantors will not, and will not permit any of their Restricted
Subsidiaries to, directly or indirectly, issue, assume, guarantee, incur, become
directly or indirectly liable with respect to (including as a result of an
Acquisition), or otherwise become responsible for, contingently or otherwise
(individually and collectively, to "incur" or, as appropriate, an "incurrence"),
any Indebtedness or any Disqualified Capital Stock (including Acquired
Indebtedness), except Permitted Indebtedness. Notwithstanding the foregoing, the
Company and the Guarantors may incur Indebtedness or Disqualified Capital Stock
if (a) no Default or Event of Default shall have occurred and be continuing at
the time of, or would occur after giving effect on a pro forma basis to, such
incurrence of Indebtedness or Disqualified Capital Stock and (b) on the date of
such incurrence (the "Incurrence Date"), the Consolidated Coverage Ratio of the
Company for the Reference Period after giving effect on a pro forma basis to
such incurrence of such Indebtedness or Disqualified Capital Stock and, to the
extent set forth in the definition of Consolidated Coverage Ratio, the use of
proceeds thereof, would be (1) for any Incurrence Date occurring prior to and
including December 31, 1998, at least 2.0 to l and (2) thereafter, at least 2.25
to 1 (any such ratio, as applicable, the "Debt Incurrence Ratio").
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Indebtedness or Disqualified Capital Stock of any
Person which is outstanding at the time such Person becomes a
Restricted Subsidiary of the Company (including upon designation of any
Unrestricted Subsidiary or other Person to be a Restricted Subsidiary) or is
merged with or into or consolidated with the Company or a Restricted Subsidiary
of the Company shall be deemed to have been Incurred at the time such Person
becomes such a Restricted Subsidiary of the Company or is merged with or into or
consolidated with the Company or a Restricted Subsidiary of the Company, as
applicable.
Section 11 Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries.
The Company and the Guarantors will not, and will not permit
any of their Restricted Subsidiaries to, directly or indirectly, create, assume
or suffer to exist any consensual restriction on the ability of any Restricted
Subsidiary of the Company to pay dividends or make other distributions to or on
behalf of, or to pay any obligation to or on behalf of, or otherwise to transfer
assets or property to or on behalf of, or make or pay loans or advances to or on
behalf of, the Company, or any Restricted Subsidiary of the Company, except (i)
restrictions imposed by the Notes or herein, (ii) restrictions imposed by
applicable law, (iii) existing restrictions under Indebtedness outstanding on
the Issue Date, (iv) restrictions under any Acquired Indebtedness not incurred
in violation of the Indenture or any agreement relating to any property, asset,
or business acquired by the Company or any of its Restricted Subsidiaries, which
restrictions, in each case, existed at the time of acquisition, were not put in
place in connection with or in anticipation of such acquisition and are not
applicable to any Person, other than the Person acquired, or to any property,
asset or business, other than the property, assets and business so acquired, (v)
any such restriction or requirement imposed by Indebtedness incurred under
clause (ii) of the definition of "Permitted Indebtedness," provided such
restriction or requirement is no more restrictive than that imposed by the
Credit Agreement as of the Issue Date, (vi) restrictions with respect solely to
a Restricted Subsidiary of the Company imposed pursuant to a binding agreement
that has been entered into for the sale or disposition of all or substantially
all of the Equity Interests or assets of such Restricted Subsidiary, provided
such restrictions apply solely to the Equity
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Interests or assets of such Restricted Subsidiary that are being sold, and (vii)
in connection with and pursuant to Permitted Refinancings, replacements of
restrictions imposed pursuant to clauses (i), (iii) or (iv) of this paragraph
that are not more restrictive than those being replaced and do not apply to any
other Person or assets than those that would have been covered by the
restrictions in the Indebtedness so refinanced. Notwithstanding the foregoing,
neither (a) customary provisions restricting subletting or assignment of any
lease entered into in the ordinary course of business, consistent with industry
practice, nor (b) Liens permitted under the terms of the Indenture on assets
securing Senior Indebtedness or Purchase Money Indebtedness incurred in
accordance with the definition of "Permitted Indebtedness" or with Section 10
shall, in and of themselves, be considered a restriction on the ability of the
Company, the applicable Guarantor or the applicable Restricted Subsidiary to
transfer such agreement or assets, as the case may be.
Section 12 Limitation on Liens.
The Company and the Guarantors will not, and will not permit
any of their Restricted Subsidiaries to, directly or indirectly, incur, or
suffer to exist any Lien on any of their respective assets, now owned or
hereinafter acquired, securing any Indebtedness that is pari passu with or
subordinated in right of payment to the Notes, except Permitted Liens, unless
the Notes or the Guarantees, as applicable, are secured on an equal and ratable
basis as such other Indebtedness; provided that, if such Indebtedness is by its
terms expressly subordinated or junior to the Notes and the Guarantees, as
applicable, the Lien securing such subordinated or junior Indebtedness shall be
subordinated and junior to the Lien securing the Notes and the Guarantees, as
applicable, with the same relative priority as such subordinated or junior
Indebtedness shall have with respect to the Notes and Guarantees, as applicable.
Section 13 Limitation on Sale of Assets and Subsidiary Stock.
The Company and the Guarantors will not, and will not permit
any of their Restricted Subsidiaries to, in one or a series of related
transactions, convey, sell, transfer, assign or otherwise dispose of, directly
or indirectly, any of its proper-
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ty, business or assets, including by merger or consolidation (in the case of a
Guarantor or a Restricted Subsidiary of the Company), and including any sale or
other transfer or issuance of any Equity Interests of any Restricted Subsidiary
of the Company, whether by the Company or a Restricted Subsidiary of the Company
and including any sale and leaseback transaction (any of the foregoing, an
"Asset Sale"), unless, (i) no Default or Event of Default shall have occurred
and be continuing at the time of, or would occur after giving effect, on a pro
forma basis, to, such Asset Sale, (ii) the Company determines in good faith (and
with respect to any Asset Sale or series of related Asset Sales in which the
aggregate Fair Market Value exceeds $5 million, as evidenced by a resolution of
the Board of Directors of the Company) that the Company or such Restricted
Subsidiary, as applicable, receives Fair Market Value for such Asset Sale, (iii)
at least 75% of the total consideration for such Asset Sale or series of related
Asset Sales consists of cash or Cash Equivalents, and (iv) (a) within 270 days
following such Asset Sale, the Net Cash Proceeds therefrom (the "Asset Sale
Offer Amount") is (1) used to retire Senior Indebtedness and permanently to
reduce the amount of such Indebtedness outstanding on the Issue Date or
permitted pursuant to clause (ii) of the definition of Permitted Indebtedness
(including that in the case of a revolver or similar arrangement that makes
credit available, the amount of total commitments is correspondingly permanently
reduced by such amount) or (2) (x) committed to be invested pursuant to one or
more definitive agreements subject only to customary closing conditions and (y)
within 365 days following such Asset Sale, invested, in assets and property
(other than notes, bonds, obligations and securities) which in the good faith
reasonable judgment of the Board will immediately constitute or be a part of a
Related Business of the Company or such Restricted Subsidiary (if it continues
to be a Restricted Subsidiary) immediately following such investment; provided,
however, that, if applicable, upon the earlier of any termination of such
agreement(s) or the failure to consummate such investment within such 365-day
period (any such event, an "Investment Default"), the Company shall immediately
make an Asset Sale Offer on the terms set forth in clause (b) below (except that
application of the Asset Sale Offer Amount shall be made within 30 days of such
Investment Default) or (b) within 270 days after the date of such Asset Sale,
the Asset Sale Offer Amount is applied to the optional redemption of the Notes
in accordance with the terms of the
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Indenture or to the repurchase of the Notes pursuant to an irrevocable,
unconditional cash offer (the "Asset Sale Offer") to repurchase Notes at a
purchase price or 100% of principal amount (the "Asset Sale Offer Price")
together with accrued and unpaid interest and Liquidated Damages, if any, to the
date of payment, made within 240 days of such Asset Sale. An acquisition of
Notes pursuant to an Asset Sale Offer may be deferred until the accumulated Net
Cash Proceeds from Asset Sales not applied to the uses (and within the times
provided) set forth in (iv) above (the "Excess Proceeds") exceeds $10 million
and that each Asset Sale Offer shall remain open for 20 Business Days following
its commencement (the "Asset Sale Offer Period"). Upon expiration of the Asset
Sale Offer Period, the Company shall apply the Asset Sale Offer Amount, plus an
amount equal to accrued and unpaid interest and Liquidated Damages, if any, to
the purchase of all Notes properly tendered (on a pro rata basis if the Asset
Sale Offer Amount is insufficient to purchase all Notes so tendered) at the
Asset Sale Offer Price (together with accrued interest). To the extent that the
aggregate amount of Notes tendered pursuant to an Asset Sale Offer is less than
the Asset Sale Offer Amount, the Company may use any remaining Net Cash Proceeds
for general corporate purposes as otherwise permitted by the Indenture and
following each Asset Sale Offer the Excess Proceeds amount shall be reset to
zero. For purposes of (iii) above, total consideration received means the total
consideration received for such Asset Sales minus the amount of (i) Senior
Indebtedness assumed by a transferee which assumption permanently reduces the
amount of Indebtedness outstanding on the Issue Date or permitted pursuant to
clause (ii) and (v) of the definition of Permitted Indebtedness (including that
in the case of a revolver or similar arrangement that makes credit available,
the amount of total commitments is correspondingly permanently reduced by such
amount), and (ii) Purchase Money Indebtedness secured solely by the assets sold
and assumed by a Transferee.
Notwithstanding the foregoing provisions of the prior
paragraph:
(i) the Company and its Restricted Subsidiaries may,
in the ordinary course of business, convey, sell, transfer, assign or
otherwise dispose of inventory acquired and held for resale in the
ordinary course of business;
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(ii) the Company and its Restricted Subsidiaries
may convey, sell, transfer, assign or otherwise dispose of
assets pursuant to and in accordance with Article V;
(iii) the Company and its Restricted Subsidiaries may
sell or dispose of property in the ordinary course of business, in the
aggregate amount not exceeding $3 million during any 12-month period,
so long as such property is no longer necessary for the proper conduct
of the business of the Company or such Restricted Subsidiary, as
applicable; and
(iv) the Company and the Guarantors may convey,
sell, transfer, assign or otherwise dispose of assets to the
Company or any of the Guarantors.
All Net Cash Proceeds from an Event of Loss shall be invested,
used for prepayment of Senior Indebtedness, or used to repurchase Notes, all
within the period and as otherwise provided above in clauses (iv)(a) or (iv)(b)
of the first paragraph of this Section 13.
In addition to the foregoing, the Company will not, and will
not permit any Restricted Subsidiary to, directly or indirectly, make any Asset
Sale of any of the Equity Interests of any Restricted Subsidiary, except
pursuant to an Asset Sale of all the Equity Interests of such Restricted
Subsidiary.
Notice of an Asset Sale Offer shall be sent, on or prior to
the commencement of the Asset Sale Offer, by first-class mail, by the Company to
each Holder at its registered address, with a copy to the Trustee. The Asset
Sale Offer shall remain open for at least 20 Business Days following its
commencement. The notice to the Holders shall contain all information,
instructions and materials required by applicable law or otherwise material to
such Holders' decision to tender Securities pursuant to the Asset Sale Offer.
The notice, which (to the extent consis- tent with this Indenture) shall govern
the terms of an Asset Sale Offer, shall state:
(i) that the Asset Sale Offer is being
made pursuant to such notice and this Section 13;
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(ii) the Asset Sale Offer Amount, the
Asset Sale Offer Price (including the amount of accrued but unpaid
interest (and Liquidated Damages, if any)), and the date of purchase;
(iii) that any Security or portion
thereof not tendered or accepted for payment will continue to accrue
interest if interest is then accruing;
(iv) that, unless the Company defaults
in depositing cash with the Paying Agent (which may not for purposes of
this Section 13, notwithstanding anything in this Indenture to the
contrary, be the Company or any Affiliate of the Company) in accordance
with the last paragraph of this Section 13, any Security, or portion
thereof, accepted for payment pursuant to the Asset Sale Offer shall
cease to accrue interest after the Asset Sale Purchase Date;
(v) that Holders electing to have a
Security, or portion thereof, purchased pursuant to an Asset Sale Offer
will be required to surrender their Security, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Security
completed, to the Paying Agent (which for purposes of this Section
4.13, notwithstanding any other provision of this Indenture, may not be
the Company or any Affiliate of the Company) at the address specified
in the notice;
(vi) that Holders will be entitled to
withdraw their elections, in whole or in part, if the Paying Agent
receives, prior to the expiration of the Asset Sale Offer, a facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Securities the Holder is withdrawing and a
statement containing a facsimile signature and stating that such Holder
is withdrawing his election to have such principal amount of Securities
purchased;
(vii) that if Securities in a principal
amount in excess of the principal amount of Securities
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to be acquired pursuant to the Asset Sale Offer are tendered and not
withdrawn, the Company shall purchase Securities on a pro rata basis
(with such adjustments as may be deemed appropriate by the Company so
that only Securities in denominations of $1,000 or integral multiples
of $1,000 shall be acquired);
(viii) that Holders whose Securities
were purchased only in part will be issued new Securities equal in
principal amount to the unpurchased portion of the Securities
surrendered; and
(ix) the circumstances and relevant
facts regarding such Asset Sales.
The Company agrees that any Asset Sale Offer shall be made in
compliance with all applicable laws, rules, and regulations, including, if
applicable, Regulation 14E of the Exchange Act and the rules and regulations
thereunder and all other applicable Federal and state securities laws, and any
provisions of this Indenture which conflict with such laws shall be deemed to be
superseded by the provisions of such laws.
On or before the date of purchase, the Company shall (i)
accept for payment Securities or portions thereof properly tendered pursuant to
the Asset Sale Offer (on a pro rata basis if required pursuant to paragraph
(vii) above), (ii) deposit with the Paying Agent cash sufficient to pay the
Asset Sale Offer Price for all Securities or portions thereof so accepted and
(iii) deliver to the Trustee Securities so accepted together with an Officers'
Certificate setting forth the Securities or portions thereof being purchased by
the Company. The Paying Agent shall promptly mail or deliver to Holders of
Securities so accepted payment in an amount equal to the Asset Sale Offer Price
for such Securities, and the Trustee shall promptly authenticate and mail or
deliver to such Holders a new Security equal in principal amount to any
unpurchased portion of the Security surrendered. Any Securities not so accepted
shall be promptly mailed or delivered by the Company to the Holder thereof.
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Section 14 Limitation on Layering Indebtedness.
The Company and the Guarantors will not, and will not permit
any of their Restricted Subsidiaries to, directly or indirectly, incur, or
suffer to exist any Indebtedness that is subordinate in right of payment to any
other Indebtedness of the Company or a Guarantor unless, by its terms, such
Indebtedness is subordinate in right of payment to, or ranks pari passu with,
the Notes or the Guarantee, as applicable.
Section 15 Limitation on Lines of Business.
Neither the Company and its Restricted Subsidiaries shall
directly or indirectly engage to any substantial extent in any line or lines of
business activity other than that which, in the good faith judgment of the Board
of Directors of the Company, is a Related Business.
Section 16 Limitation on Status as Investment Company.
The Company and its Subsidiaries are prohibited from being
required to be registered as an "investment company" (as that term is defined in
the Investment Company Act of 1940, as amended), or otherwise become subject to
regulation under the Investment Company Act.
Section 17 Future Subsidiary Guarantors.
All present Subsidiaries and future Restricted Subsidiaries of
the Company, jointly and severally, will guarantee irrevocably and
unconditionally all principal, premium, if any, and interest on the Notes on a
senior subordinated basis.
Section 18 Limitation on Payments for Consent.
None of the Company or any of its Subsidiaries shall, directly
or indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for, or as an inducement
to, any consent, waiver or amendment of any of the terms or provisions of the
Indenture or the Notes, unless such consideration is offered to be paid or is
irrevocably pledged to be paid to all Holders of the Notes who so consent,
waive, or agree to amend in the time
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frame set forth in the solicitation documents relating to such consent, waiver
or agreement, which solicitation documents must be mailed to all Holders of the
Notes prior to the expiration of the solicitation.
Section 19 Security.
As soon as practicable after the Issue Date, the Company shall
purchase and pledge to the securities intermediary and financial intermediary
under that certain Security Agreement, dated as of the Issue Date, by and
between the Company and The Bank of New York, as securities intermediary and
financial intermediary (the "Security Agreement"), for the benefit of the
Holders of the Notes, the Government Securities in such amount as will be
sufficient upon receipt of scheduled interest and principal payments of such
securities, in the opinion of a nationally recognized firm of independent public
accountants selected by the Company, to provide for payment in full when due the
amount of interest to be paid on the Notes on each of the first three scheduled
interest payment dates on the Notes. The Holders shall have the benefit of an
exclusive, first priority security interest in the account holding all such
Government Securities, and all other cash or property, pledged under the
Security Agreement.
ARTICLE V
SUCCESSOR CORPORATION
Section 5.1 Limitation on Merger, Sale or Consolidation.
The Company will not consolidate with or merge with or into
another Person or, directly or indirectly, sell, lease, convey or transfer all
or substantially all of its assets (computed on a consolidated basis), whether
in a single transaction or a series of related transactions, to another Person
or group of affiliated Persons except for any consolidation or merger with or
into, or sale, lease or transfer solely to, a Guarantor, or adopt a plan of
liquidation, unless (i) either (a) the Company is the continuing entity or (b)
the resulting, surviving or transferee entity or, in the case of a plan of
liquidation, the entity which receives the greatest value from such plan of
liquidation is a corporation organized under the laws of the United States, any
state thereof or the District of Columbia and expressly
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assumes by supplemental indenture all of the obligations of the Company in
connection with the Notes and the Indenture; (ii) immediately after giving
effect to such transaction on a pro forma basis no Default or Event of Default
shall exist or would occur, (iii) immediately after giving effect to such
transaction on a pro forma basis, the Consolidated Net Worth of the consolidated
surviving or transferee entity or, in the case of a plan of liquidation, the
entity which receives the greatest value from such plan of liquidation is at
least equal to the Consolidated Net Worth of the Company immediately prior to
such transaction; and (iv) immediately after giving effect to such transaction
on a pro forma basis, the consolidated resulting, surviving or transferee entity
or, in the case of a plan of liquidation, the entity which receives the greatest
value from such plan of liquidation would immediately thereafter be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Debt Incurrence
Ratio set forth in Section 10.
On or prior to the consummation of the proposed transaction,
the Company shall have delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, sale,
assignment, conveyance, transfer, lease or disposition and such supplemental
indenture executed in connection therewith comply with this Indenture. The
Trustee shall be entitled to conclusively rely upon such Officers' Certificate
and Opinion of Counsel.
For purposes of the foregoing, the transfer (by lease,
assignment, sale or otherwise) of all or substantially all of the properties and
assets of one or more Subsidiaries, the Company's interest in which constitutes
all or substantially all of the properties and assets of the Company on a
consolidated basis, shall be deemed to be the transfer of all or substantially
all of the properties and assets of the Company.
Section 5.2 Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company or consummation of a plan of
liquidation in accordance with the foregoing, the successor corporation formed
by such consolidation or into which the Company is merged or to which such
transfer is made or, in the case of a plan of liquidation, the entity which
receives the
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greatest value from such plan of liquidation shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under
the Indenture with the same effect as if such successor corporation had been
named therein as the Company, and the Company shall be released from the
obligations under the Notes and the Indenture except with respect to any
obligations that arise from, or are related to, such transaction.
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
Section 1 Events of Default.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be caused voluntarily or involuntarily or effected, without limitation, by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) the failure by the Company to pay
any installment of interest on the Notes as and when the same becomes
due and payable and the continuance of any such failure for 30 days;
provided, however, that any failure by the Company to pay in full any
interest on the Notes in a timely manner through October 1, 1998 or to
purchase and deposit the Government Securities as soon as practicable
after the Issue Date as required by the Security Agreement, will
constitute an immediate Event of Default;
(ii) the failure by the Company to pay
all or any part of the principal, or premium, if any, on the Notes when
and as the same becomes due and payable at maturity, redemption, by
acceleration or otherwise, including, without limitation, payment of
the Change of Control Purchase Price or the Asset Sale
Offer Amount, or otherwise;
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(iii) the failure by the Company or any
of its Restricted Subsidiaries otherwise to comply with
Section 4.13, or Articles V or X;
(iv) failure by the Company or any
Restricted Subsidiary to observe or perform any other covenant or
agreement contained in the Notes or the Indenture (except as provided
in clauses (i), (ii) and (iii) above) and the continuance of such
failure for a period of 60 days after written notice is given to the
Company by the Trustee or to the Company and the Trustee by the Holders
of at least 25% in aggregate principal amount of the Notes outstanding;
(v) a decree, judgment, or order by a
court of competent jurisdiction shall have been entered adjudicating
either the Company or any of its Significant Subsidiaries as bankrupt
or insolvent, or approving as properly filed a petition seeking
reorganization of either the Company or any of its Significant
Subsidiaries under any bankruptcy or similar law, and such decree or
order shall have continued undischarged and unstayed for a period of 60
consecutive days; or a decree or order of a court of competent
jurisdiction, judgment appointing a receiver, liquidator, trustee, or
assignee in bankruptcy or insolvency for either the Company, any of its
Significant Subsidiaries, or any substantial part of the property of
any such Person, or for the winding up or liquidation of the affairs of
any such Person, shall have been entered, and such decree, judgment, or
order shall have remained in force undischarged and unstayed for a
period of 60 days;
(vi) the Company or any Significant
Subsidiary of the Company shall institute proceedings to be adjudicated
a voluntary bankrupt, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent
seeking reorganization under any bankruptcy or similar law or similar
statute, or shall consent to the filing of any such petition, or shall
consent to the appointment of a Custodian, receiver, liquidator,
trustee, or assignee in bankruptcy or insolvency of it or any
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substantial part of its assets or property, or shall make a general
assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts as they become due;
(vii) a default in Indebtedness for
borrowed money of the Company or any of its Restricted Subsidiaries
with an aggregate principal amount in excess of $5 million, which
default (A) is caused by the failure to pay principal on the maturity
date thereof or (B) results in the acceleration of such Indebtedness
prior to its express maturity; and
(viii) final unsatisfied judgments not
covered by insurance aggregating in excess of $5 million, at any one
time rendered against the Company or any of its Restricted Subsidiaries
and is not stayed, bonded or discharged within 60 days; and
(ix) the failure to comply with any of the
terms of the Security Agreement as in effect on the Issue Date.
If a Default occurs and is continuing, the Trustee must,
within 90 days after the occurrence of such Default, give to the Holders notice
of such Default, pursuant to Section 7.5.
Section 2 Acceleration of Maturity Date; Rescission
and Annulment.
If an Event of Default occurs and is continuing (other than an
Event of Default specified in clauses (v) or (vi), above, relating to the
Company or any Significant Subsidiary,) then in every such case, unless the
principal of all of the Notes shall have already become due and payable, either
the Trustee or the Holders of 25% in aggregate principal amount of the Notes
then outstanding, by notice in writing to the Company (and to the Trustee if
given by Holders) (an "Acceleration Notice"), may declare all principal
determined as set forth below, and accrued interest thereon to be due and
payable immediately; provided, however, that if any Senior Indebtedness is
outstanding pursuant to the Credit Agreement, upon a declaration of such
acceleration, such principal and interest shall be due and payable upon the
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earlier of (a) the fifth Business Day after the sending to the Company and the
Representative of such written notice, unless such Event of Default is cured or
waived prior to such date and (b) the date of acceleration of any Senior
Indebtedness under the Credit Agreement. If an Event of Default specified in
clauses (v) or (vi) above relating to the Company or any of its Significant
Subsidiaries occurs, all principal and accrued interest thereon will be
immediately due and payable on all outstanding Notes without any declaration or
other act on the part of Trustee or the Holders.
At any time after such a declaration of acceleration being
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter provided in this Article VI, the Holders
of a majority in aggregate principal amount of then outstanding Securities, by
written notice to the Company and the Trustee, may rescind, on behalf of all
Holders, any such declaration of acceleration if:
(1) the Company has paid or deposited with the
Trustee a sum sufficient to pay
(A) all overdue interest
(and Liquidated Damages, if any) on all Securities,
(B) the principal of
(and premium, if any, applicable to) any Securities which
would become due otherwise than by such declaration of
acceleration, and interest thereon at the rate borne by the
Securities,
(C) to the extent that
payment of such interest is lawful, interest upon overdue
interest (and Liquidated Damages, if any) at the rate borne by
the Securities,
(D) all sums paid or
advanced by the Trustee hereunder and the compensation,
expenses, disbursements and
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advances of the Trustee, its agents and counsel, and
(2) all Events of Default, other than the non-payment
of amounts which have become due solely by such declaration of
acceleration and except a default with respect to any provision
requiring a supermajority approval to amend, which default may only
be waived by such a supermajority, and have been cured or waived as
provided in Section 12.
Notwithstanding the previous sentence of this Section 2, no waiver shall be
effective for any Event of Default or event which with notice or lapse of time
or both would be an Event of Default with respect to any covenant or provision
which cannot be modified or amended without the consent of the Holder of each
outstanding Security, unless all such affected Holders agree, in writing, to
waive such Event of Default or other event. No such waiver shall cure or waive
any subsequent default or impair any right consequent thereon.
Section 3 Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company covenants that if an Event of Default in payment
of principal, premium, or interest (and Liquidated Damages, if any) specified in
Section 1(i) or (ii) occurs and is continuing, the Company shall, upon demand of
the Trustee, pay to it, for the benefit of the Holders of such Securities, the
whole amount then due and payable on such Securities for principal, premium (if
any) and interest (and Liquidated Damages, if any), and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal (and premium, if any) and on any overdue interest (and Liquidated
Damages, if any), at the rate borne by the Securities, and, in addition thereto,
such further amount as shall be sufficient to cover the costs and expenses of
collection, including compensation to, and expenses, disbursements and advances
of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust in favor
of the Holders, may institute a judicial
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proceeding for the collection of the sums so due and unpaid, may prosecute such
proceeding to judgment or final decree and may enforce the same against the
Company or any other obligor upon the Securities and collect the moneys adjudged
or decreed to be payable in the manner provided by law out of the property of
the Company or any other obligor upon the Securities, wherever situated.
If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders by such appropriate judicial proceedings as the Trustee shall
deem most effective to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
Section 4 Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or its
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise to take any and
all actions under the TIA, including
(i) to file and prove a claim for the
whole amount of principal (and premium, if any) and interest (and
Liquidated Damages, if any) owing and unpaid in respect of the
Securities and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agent and counsel) and
of the Holders allowed in such judicial proceeding, and
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(ii) to collect and receive any moneys
or other property payable or deliverable on any such claims and to
distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment, or composition affecting
the Securities or the rights of any Holder thereof or to authorize the Trustee
to vote in respect of the claim of any Holder in any such proceeding.
Section 5 Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust in favor of the Holders, and any
recovery of judgment shall, after provision for the payment of compensation to,
and expenses, disbursements and advances of the Trustee, its agents and counsel,
be for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
Section 6 Priorities.
Subject to Article XII, any money collected by the Trustee
pursuant to this Article VI shall be applied in the following order, at the date
or dates fixed by the Trustee and, in case of the distribution of such money on
account of principal, premium (if any) or interest (and Liquidated Damages, if
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any), upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the Trustee in payment of all amounts due
pursuant to Section 7.7;
SECOND: To the Holders in payment of the amounts then due and
unpaid for principal of, premium (if any) and interest (and Liquidated Damages,
if any) on, the Securities in respect of which or for the benefit of which such
money has been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for principal,
premium (if any) and interest (and Liquidated Damages, if any), respectively;
and
THIRD: To whomsoever may be lawfully entitled thereto,
the remainder, if any.
Section 7 Limitation on Suits.
No Holder of any Security shall have any right to order or
direct the Trustee to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(A) such Holder has
previously given written notice to the Trustee of a
continuing Event of Default;
(B) the Holders of not
less than 25% in principal amount of then outstanding
Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;
(C) such Holder or
Holders have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities to be
incurred or
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reasonably probable to be incurred in compliance with such
request;
(D) the Trustee for 60
days after its receipt of such notice, request and offer of
indemnity has failed to institute any such proceeding; and
(E) no direction
inconsistent with such written request has been given to the
Trustee during such 60-day period by the Holders of a majority
in principal amount of the outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
Section 8 Unconditional Right of Holders to Receive
Principal, Premium and Interest.
Notwithstanding any other provision of this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of, and premium (if any) and
interest (and Liquidated Damages, if any) on, such Security on each Maturity
Date or Interest Payment Date, as applicable, of such payments as expressed in
such Security (in the case of redemption, the Redemption Price on the Redemption
Date; in the case of a Change of Control, the Change of Control Purchase Price
on the Change of Control Purchase Date; and in the case of an Asset Sale, the
Asset Sale Offer Price on the relevant purchase date); and to institute suit for
the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
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Section 9 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in Section 7, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 10 Delay or Omission Not Waiver.
No delay or omission by the Trustee or by any Holder of any
Security to exercise any right or remedy arising upon any Event of Default shall
impair the exercise of any such right or remedy or constitute a waiver of any
such Event of Default. Every right and remedy given by this Article VI or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
Section 11 Control by Holders.
The Holder or Holders of a majority in aggregate principal
amount of then outstanding Securities shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred upon the Trustee, provided
that
(1) such direction shall not be in conflict with any
rule of law or with this Indenture,
(2) the Trustee shall not determine that the action so
directed would be unjustly prejudi-cial to the Holders not taking
part in such direction, and
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(3) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such direction.
Section 12 Waiver of Past Default.
Subject to Section 8, the Holder or Holders of not less than
a majority in aggregate principal amount of the outstanding Securities may, by
written notice to the Trustee on behalf of all Holders, prior to the declaration
of the maturity of the Securities, waive any past default hereunder and its
consequences, except a default
(A) in the payment of
the principal of, premium, if any, or interest (and Liquidated
Damages, if any) on, any Security as specified in clauses (i)
and (ii) of Section 1, or
(B) in respect of a
covenant or provision hereof which, under Article IX, cannot
be modified or amended without the consent of the Holder of
each outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair the exercise of any right arising
therefrom.
Section 13 Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any
Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for
any action taken, suffered or omitted to be taken by it as Trustee, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and expenses, against any party litigant
in such suit, having due regard to the merits
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and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 13 shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in aggregate
principal amount of the outstanding Securities, or to any suit instituted by any
Holder for enforcement of the payment of principal of, or premium (if any) or
interest (and Liquidated Damages, if any) on, any Security on or after the
Maturity Date of such Security.
Section 14 Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every case, subject to any
determination in such proceeding, the Company, the Guarantors, the Trustee and
the Holders shall be restored severally and respectively to its former positions
hereunder and thereafter all rights and remedies of the Trustee and the Holders
shall continue as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this
Indenture and covenants and agrees to perform the same, as herein expressed.
Section 7.1 Duties of Trustee.
(a) If a Default or an Event of Default has
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture and use the same degree of care and skill
in its exercise as a prudent Person would exercise or use under the
circumstances in the conduct of such person's own affairs.
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(b) Except during the continuance of a Default or
an Event of Default:
(i) The Trustee need perform only those
duties as are specifically set forth in this Indenture and no others,
and no covenants or obligations shall be implied in or read into this
Indenture which are adverse to the Trustee.
(ii) In the absence of bad faith on its
part, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture. However, in the case of any such
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture.
(c) The Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act, or its own
willful misconduct, except that:
(i) This paragraph does not limit the
effect of subsection (b) of this Section 7.1.
(ii) The Trustee shall not be liable
for any error of judgment made in good faith by a Trust Officer, unless
it is proved that the Trustee was grossly negligent in ascertaining the
pertinent facts.
(iii) The Trustee shall not be liable
with respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section 12.
(d) No provision of this Indenture shall require
the Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or to take or omit
to take any action under this Indenture or at the request, order or direction of
the Holders or
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in the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.
(e) Every provision of this Indenture that in any
way relates to the Trustee is subject to subsections (a), (b), (c), (d) and (e)
of this Section 7.1.
(f) The Trustee shall not be liable for interest
on any assets received by it except as the Trustee may agree in writing with the
Company. Assets held in trust by the Trustee need not be segregated from other
assets except to the extent required by law.
Section 7.2 Rights of Trustee.
Subject to Section 7.1:
(a) The Trustee may conclusively rely on any
document believed by it to be genuine and to have been signed or presented by
the proper Person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from
acting, it may consult with counsel of its selection and may require an
Officers' Certificate or an Opinion of Counsel, which shall conform to Sections
13.4 and 13.5. The Trustee shall not be liable for any action it takes or omits
to take in good faith in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and
agents and shall not be responsible for the misconduct or negligence of any
agent appointed with due care.
(d) The Trustee shall not be liable for any
action it takes or omits to take in good faith which it believes to be
authorized or within its rights or powers.
(e) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, notice, request, direction, consent, order,
bond, debenture, or other paper or
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document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit.
(f) The Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Indenture at the
request, order or direction of any of the Holders, pursuant to the provisions of
this Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which may be
incurred therein or thereby.
(g) Except with respect to Section 1, the
Trustee shall have no duty to inquire as to the performance of the Company's
covenants in Article IV hereof. In addition, the Trustee shall not be deemed to
have knowledge of any Default or Event of Default except (i) any Event of
Default occurring pursuant to Sections 6.1(i), 6.1(ii) and 4.1, or (ii) any
Default or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge.
Section 3 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company, any
Guarantor, any of its respective Subsidiaries, or their respective Affiliates
with the same rights it would have if it were not Trustee. Any Agent may do the
same with like rights. However, the Trustee must comply with Sections 7.10 and
7.11.
Section 4 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or
adequacy of this Indenture or the Securities and it shall not be accountable for
the Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities (other than the Trustee's
certificate of authentication) or for the use or application of any funds
received by a Paying Agent other than the Trustee.
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Section 5 Notice of Default.
If a Default or an Event of Default occurs and is continuing
and if it is actually known to the Trustee, the Trustee shall mail to each
Securityholder notice of the uncured Default or Event of Default within 90 days
after such Default or Event of Default occurs. Except in the case of a Default
or an Event of Default in payment of principal (or premium, if any) of, or
interest (and Liquidated Damages, if any) on, any Security (including the
payment of the Change of Control Purchase Price on the Change of Control
Purchase Date, the Redemption Price on the Redemption Date, and the Asset Sale
Offer Price on the relevant purchase date), the Trustee may withhold the notice
if and so long as a Trust Officer in good faith determines that withholding the
notice is in the interest of the Securityholders.
Section 6 Reports by Trustee to Holders.
If required by law, within 60 days after each January 31
beginning with the January 31 following the date of this Indenture, the Trustee
shall mail to each Securityholder a brief report dated as of such January 31
that complies with TIA ss. 313(a). If required by law, the Trustee also shall
comply with TIA xx.xx. 313(b) and 313(c).
The Company shall promptly notify the Trustee in writing if
the Securities become listed on any stock exchange or automatic quotation
system.
A copy of each report at the time of its mailing to
Securityholders shall be mailed to the Company and filed with the
SEC and each stock exchange, if any, on which the Securities are listed.
Section 7 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation as shall be agreed in writing between the Company and the Trustee
for its services. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable disbursements, expenses and advances
incurred or made by it. Such expenses shall include
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the reasonable compensation, disbursements, fees and expenses of the Trustee's
agents, accountants, experts and counsel.
The Company shall indemnify the Trustee (in its capacity as
Trustee, Registrar and Paying Agent) and each of its officers, directors,
attorneys-in-fact and agents for, and hold it harmless against, any claims,
loss, damage, demand, fee, expense (including but not limited to reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel),
loss or liability incurred by them without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
trust and their rights or duties hereunder including the reasonable costs and
expenses of defending themselves against any claim or liability in connection
with the exercise or performance of any of its powers or duties hereunder. The
Trustee shall notify the Company promptly of any claim asserted against the
Trustee for which it may seek indemnity. The Company shall defend the claim and
the Trustee shall provide reasonable cooperation at the Company's expense in the
defense. The Trustee may have separate counsel and the Company shall pay the
reasonable fees and expenses of such counsel; provided that the Company will not
be required to pay such fees and expenses if they assume the Trustee's defense
and there is no conflict of interest between the Company and the Trustee in
connection with such defense. The Company need not pay for any settlement made
without its written consent. The Company need not reimburse any expense or
indemnify against any loss or liability to the extent incurred by the Trustee
through its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section
7.7, the Trustee shall have a lien prior to the Securities on all assets held or
collected by the Trustee, in its capacity as Trustee, except assets held in
trust to pay principal and premium, if any, of or interest (and Liquidated
Damages, if any) on particular Securities.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 1(v) or (vi) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
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The Company's obligations under this Section 7 and any lien
arising hereunder shall survive the resignation or removal of the Trustee, the
discharge of the Company's obligations pursuant to Article VIII of this
Indenture and any rejection or termination of this Indenture under any
Bankruptcy Law.
Section 8 Replacement of Trustee.
The Trustee may resign by so notifying the Company in writing.
The Holder or Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Company and the Trustee in
writing and may appoint a successor trustee with the Company's consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver, Custodian, or other public officer
takes charge of the Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holder or Holders of a majority in principal amount of the Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that
and provided that all sums owing to the Trustee provided for in Section 7 have
been paid, the retiring Trustee shall transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided in Section 7,
the resignation or removal of the retiring Trustee shall become
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effective, and the successor Trustee shall have all the rights, powers and
duties of the Trustee under this Indenture. A successor Trustee shall mail
notice of its succession to each Holder.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holder or Holders of at least 10% in principal amount of the
outstanding Securities may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 8, the Company's obligations under Section 7 shall continue for the
benefit of the retiring Trustee.
Section 9 Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
Section 10 Eligibility; Disqualification.
The Trustee shall at all times satisfy the requirements of TIA
ss. 310(a)(1) and TIA ss. 310(a)(5). The Trustee shall have a combined capital
and surplus of at least $50,000,000 as set forth in its most recent published
annual report of condition. The Trustee shall comply with TIA ss. 310(b).
Section 11 Preferential Collection of Claims against Company.
The Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). A Trustee who
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has resigned or been removed shall be subject to TIA ss. 311(a) to the extent
indicated.
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 1 Option to Effect Legal Defeasance or Covenant
Defeasance.
The Company may, at its option at any time within one year of
the Stated Maturity of the Notes, elect to have its obligations and the
obligations of the Guarantors discharged with respect to the outstanding Notes
("Legal Defeasance") by having Section 2 or Section 3 applied to all
outstanding Securities upon compliance with the conditions set forth below in
this Article VIII.
Section 2 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 1 of the option
applicable to this Section 2, the Company and the Guarantors shall be deemed to
have been discharged from their respective obligations with respect to all
outstanding Securities on the date the conditions set forth below are satisfied.
Such Legal Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented, and this Indenture shall cease
to be of further effect as to all outstanding Notes and Guarantees, except as to
(i) the rights of Holders to receive payments in respect of the principal of,
premium, if any, and interest on such Notes when such payments are due from the
trust funds referred to below, and described more fully in Section 9.4, (ii) the
Company's obligations with respect to such Notes under Sections 2.4, 2.6, 2.7,
2.10 and 4.2, (iii) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's obligations in connection therewith and (iv)
this Article VIII. Subject to compliance with this Article VIII, the Company may
exercise its option under this Section 2 notwithstanding the prior exercise of
its option under Section 3 with respect to the Securities.
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Section 3 Covenant Defeasance.
Upon the Company's exercise under Section 1 of the option
applicable to this Section 3, the Company shall be released from its
obligations under the covenants contained in Sections 4.3, 4.6, 4.7, 4.9, 4.10,
4.11, 4.12, 4.13, 4.14, 4.15 and 4.16, 4.17, 4.18, Article V and Article X with
respect to the outstanding Securities on and after the date the conditions set
forth below are satisfied (hereinafter, "Covenant Defeasance"), and the
Securities shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder. For this
purpose, such Covenant Defeasance means that, with respect to the outstanding
Securities, the Company need not comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other provision herein or in any other document, but, except as specified above,
the remainder of this Indenture and such Securities shall be unaffected thereby.
In addition, upon the Company's exercise under Section 1 of the option
applicable to this Section 3, Sections 6.1(3) through 6.1(8) shall not
constitute Events of Default.
Section 4 Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of
either Section 2 or Section 3 to the outstanding Securities:
(i) the Company must irrevocably deposit
with the Trustee, in trust (or another trustee satisfying the
requirements of Section 10 who shall agree to comply with the
provisions of this Article VIII applicable to it), for the benefit of
the Holders of such Notes, U.S. legal tender, or U.S. Government
Obligations or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of
independent public accountants, to pay the principal of, premium, if
any, and interest on
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such Notes on the stated date for payment thereof or on the redemption
date of such principal or installment of principal, premium, if any, or
interest on such Notes and the Holders of the Notes must have a valid,
perfected, exclusive security interest in such trust; provided that the
Trustee shall have been irrevocably instructed to apply such cash and
the proceeds of such U.S. Government Obligations to said payments with
respect to the Securities;
(ii) in the case of an election under
Section 2, the Company shall have delivered to the Trustee an opinion
of counsel in the United States reasonably acceptable to Trustee
confirming that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the
date hereof, there has been a change in the applicable Federal income
tax law, in either case to the effect that, and based thereon such
opinion of counsel shall confirm that, the Holders of such Notes will
not recognize income, gain or loss for Federal income tax purposes as a
result of such Legal Defeasance and will be subject to Federal income
tax on the same amounts, in the same manner and at the same times as
would have been the case if such Legal Defeasance had not occurred;
(iii) in the case of an election under
Section 3, the Company shall have delivered to the Trustee an opinion
of counsel in the United States reasonably acceptable to such Trustee
confirming that the Holders of such Notes will not recognize income,
gain or loss for Federal income tax purposes as a result of such
Covenant Defeasance and will be subject to Federal income tax in the
same amount, in the same manner and at the same times as would have
been the case if such Covenant Defeasance had not occurred;
(iv) no Default or Event of Default
shall have occurred and be continuing on the date of such deposit or in
so far as Section 1(v) or 6.1(vi) is concerned, at any time in the
period ending on the 91st day after the date of such deposit;
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(v) such Legal Defeasance or Covenant
Defeasance shall not result in a breach or violation of, or constitute
a default under, this Indenture or any other material agreement or
instrument to which the Company or any of its Subsidiaries is bound;
(vi) in the case of an election under
either Section 2 or 8.3, the Company shall have delivered to the
Trustee an Officers' Certificate stating that the deposit made by the
Company pursuant to its election under Section 2 or 8.3 was not made
by the Company with the intent of preferring the Holders of such Notes
over other creditors of the Company or with the intent of defeating,
hindering, delaying or defrauding any other creditors of the Company or
others; and
(vii) the Company shall have delivered
to the Trustee an Officers' Certificate and an opinion of counsel, each
stating that the conditions precedent provided for, in the case of the
Officers' Certificate, (i) through (vi) of this Section 4 and, in the
case of the Opinion of Counsel, clauses (i) (with respect to the
validity and perfection of the security interest), (ii), (iii) and (v)
of this Section 4 have been complied with as contemplated by this
Section 4.
If the funds deposited with the Trustee to effect Legal
Defeasance or Covenant Defeasance are insufficient to pay the principal of,
premium, if any, and interest on the Notes when due, then the obligations of the
Company under this Indenture will be revived and no such defeasance will be
deemed to have occurred.
Section 5 Deposited Cash and U.S. Government Obliga-
tions to Be Held in Trust; Other Miscellaneous Provisions.
Subject to Section 6, all cash and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 5, the
"Trustee") pursuant to Section 4 in respect of the outstanding Securities
shall be held in trust and
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applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent as
the Trustee may determine, to the Holders of such Securities of all sums due and
to become due thereon in respect of principal, premium, if any, and interest
(and Liquidated Damages, if any), but such money need not be segregated from
other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 4 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of outstanding Securities.
Section 6 Repayment to Company.
Anything in this Article VIII to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any cash or U.S. Government Obligations held by it as
provided in Section 4 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereto
delivered to the Trustee (which may be the opinion delivered under Section
8.4(a)), are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium,
if any, or interest (and Liquidated Damages, if any) on any Security and
remaining unclaimed for two years after such principal, and premium, if any, or
interest (and Liquidated Damages, if any) has become due and payable shall be
paid to the Company on its request; and the Holder of such Security shall
thereafter look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money shall
thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in the New York Times and The Wall Street
Journal (national edition), notice that such money remains unclaimed and that,
after a date specified therein, which
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shall not be less than 30 days from the date of such notification or
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.
Section 7 Reinstatement.
If the Trustee or Paying Agent is unable to apply any cash or
U.S. Government Obligations in accordance with Section 2 or 8.3, as the case may
be, by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company' obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to Section 2 or 8.3
until such time as the Trustee or Paying Agent is permitted to apply such money
in accordance with Section 2 and 8.3, as the case may be; provided, however,
that, if the Company make any payment of principal of, premium, if any, or
interest (and Liquidated Damages, if any) on any Security following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the Cash held by
the Trustee or Paying Agent.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 1 Supplemental Indentures Without Consent of
Holders.
Without the consent of any Holder, the Company or any
Guarantor, when authorized by Board Resolutions, and the Trustee, at any time
and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) to cure any ambiguity, defect,
or inconsistency, or to make any other provisions with respect to
matters or questions arising under this Indenture which shall not be
inconsistent with the provisions of this Indenture, provided such
action pursuant to this clause (1) shall not adversely affect the
interests of any Holder in any respect;
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(2) to add to the covenants of the Company for the
benefit of the Holders, or to surrender any right or power herein
conferred upon the Company or to make any other change that does not
adversely affect the rights of any Holder; provided, that the Company
has delivered to the Trustee an Opinion of Counsel stating that such
change does not adversely affect the rights of any Holder;
(3) to provide for additional Guarantors of the
Securities;
(4) to evidence the succession of
another Person to the Company, and the assumption by any such successor
of the obligations of the Company, herein and in the Securities in
accordance with Article V or Article XI; or
(5) to comply with the TIA.
Section 2 Amendments, Supplemental Indentures and Waivers
with Consent of Holders.
Subject to Section 8 and the last sentence of this
paragraph, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Notes at the time outstanding, by written act
of said Holders delivered to the Company and the Trustee, the Company and any
Guarantor, when authorized by Board Resolutions, and the Trustee may amend or
supplement this Indenture or the Securities or enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
the Securities or of modifying in any manner the rights of the Holders under the
this Indenture or the Securities. Subject to Section 8 and the last sentence of
this paragraph, the Holder or Holders of a majority, in principal amount of then
outstanding Securities may waive compliance by the Company or any Guarantor with
any provision of this Indenture or the Securities; provided that notwithstanding
the foregoing provisions of this Section 9.2, no such modification may, without
the consent of Holders of at least 66 2/3% in aggregate principal amount of
Notes at the time outstanding,
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modify the provisions (including the defined terms used therein) of Section 10.1
in a manner adverse to the Holders; and provided that, without the consent of
each Holder affected thereby, no such modification, amendment, supplemental
indenture or waiver shall:
(1) reduce the percentage of principal amount of
Securities whose Holders must consent to an amendment, supplement or
waiver of any provision of this Indenture or the Securities;
(2) reduce the rate or extend the time for payment of
interest (and Liquidated Damages, if any) on any Security;
(3) reduce the principal amount of any Security, or
reduce the Change of Control Purchase Price or the Asset Sale Offer
Price;
(4) change the Stated Maturity of any Security;
(5) alter the redemption provisions of Article III or
paragraph 5 of the Securities in a manner adverse to any Holder;
(6) make any changes in the provisions concerning
waivers of Defaults or Events of Default by Holders of the Securities
(except to increase any percentage of Securities required to consent to
a waiver or to provide that certain other provisions of the Indenture
cannot be modified or waived without the consent of the Holder of each
outstanding Security affected thereby) or the rights of Holders to
recover the principal or premium of, interest (and Liquidated Damages,
if any) on, or redemption payment with respect to, any Security;
(7) make any changes in Section 6.8, 6.12 or this second
sentence of this Section 9.2;
(8) make the principal of, or the interest (and
Liquidated Damages, if any) on, any Secu-
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rity payable with anything or at anywhere other than as provided for
in this Indenture and the Securities as in effect on the date hereof;
(9) make the Securities or Guarantees further
subordinated in right of payment to any extent or under any
circumstances to any other indebtedness; or
(10) change any terms of the Security Agreement in a
manner adverse to the Holders.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
After an amendment, supplement or waiver under this Section
9.2 or Section 9.4 becomes effective, it shall bind each Holder.
Subject to Section 18, in connection with any amendment,
supplement or waiver under this Article IX, the Company may, but shall not be
obligated to, offer to any Holder who consents to such amendment, supplement or
waiver, or to all Holders, consideration for such Holder's consent to such
amendment, supplement or waiver.
Section 3 Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
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Section 4 Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a
consent to it by a Holder is a continuing consent by the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security, even if notation of the consent is not
made on any Security. However, any such Holder or subsequent Holder may revoke
the consent as to his Security or portion of his Security by written notice to
the Company or the Person designated by the Company as the Person to whom
consents should be sent if such revocation is received by the Company or such
Person before the date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite principal amount of Securities have
consented (and not theretofore revoked such consent) to the amendment,
supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement or waiver, which record date shall be the date so fixed by
the Company notwithstanding the provisions of the TIA. If a record date is
fixed, then notwithstanding the last sentence of the immediately preceding
paragraph, those Persons who were Holders at such record date, and only those
Persons (or their duly designated proxies), shall be entitled to revoke any
consent previously given, whether or not such Persons continue to be Holders
after such record date. No such consent shall be valid or effective for more
than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change described in any of
clauses (1) through (10) of Section 9.2, in which case, the amendment,
supplement or waiver shall bind only each Holder of a Security who has consented
to it and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holder's Security; provided, that any
such waiver shall not impair or affect the right of any Holder to receive
payment of principal and premium of and interest (and Liquidated Damages, if
any) on a Security, on or after the respective dates set for such amounts to
become due and payable expressed in such Security, or to bring suit for
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the enforcement of any such payment on or after such respective dates.
Section 5 Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee or require the Holder to put an appropriate notation on the
Security. The Trustee may place an appropriate notation on the Security about
the changed terms and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the Security shall issue,
the Guarantors shall endorse and the Trustee shall authenticate a new Security
that reflects the changed terms. Any failure to make the appropriate notation or
to issue a new Security shall not affect the validity of such amendment,
supplement or waiver.
Section 6 Trustee to Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article IX, provided, that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Officers' Certificate and Opinion of Counsel
stating that the execution of any amendment, supplement or waiver authorized
pursuant to this Article IX is authorized or permitted by this Indenture.
ARTICLE X
RIGHT TO REQUIRE REPURCHASE
Section 10.1 Repurchase of Securities at Option of the Holder
upon Change of Control.
(a) In the event that a Change of Control has
occurred, each Holder of Notes will have the right, at such Holder's option,
pursuant to an irrevocable and unconditional offer by the Company (the "Change
of Control Offer"), to require
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the Company to repurchase all or any part of such holder's Notes (provided, that
the principal amount of such Notes must be $1,000 or an integral multiple
thereof) on a date (the "Change of Control Purchase Date") that is no later than
45 Business Days after the occurrence of such Change of Control, at a cash price
equal to 101% of the principal amount thereof (the "Change of Control Purchase
Price"), together with accrued and unpaid interest (and Liquidated Damages, if
any,) to the Change of Control Purchase Date.
(b) In the event that, pursuant to this Section
10.1, the Company shall be required to commence a Change of Control Offer, the
Company shall follow the procedures set forth in this Section 10.1 as follows:
(1) the Change of Control Offer
shall commence within 20 Business Days following the
Change of Control;
(2) the Change of Control Offer
shall remain open for at least 20 Business Days following its
commencement (unless a longer period shall be required by law)(the
"Change of Control Offer Period");
(3) upon expiration of the Change
of Control Offer Period, the Company promptly shall purchase all Notes
properly tendered in response to the Change of Control Offer at the
Change of Control Purchase Price, plus accrued interest (and Liquidated
Damages, if any);
(4) if the Change of Control Pur-
chase Date is on or after an interest payment record date and on or
before the related interest payment date, any accrued interest (and
Liquidated Damages, if any) will be paid to the Person in whose name a
Security is registered at the close of business on such record date,
and no additional interest will be payable to Securityholders who
tender Securities pursuant to the Change of Control Offer;
(5) the Company shall use its best
efforts to provide the Trustee with notice of the
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Change of Control Offer at least 5 Business Days before the
commencement of any Change of Control Offer; and
(6) at the commencement of any
Change of Control Offer, the Company or the Trustee (upon the request
and at the expense of the Company) shall send, by first-class mail, a
notice to each of the Securityholders, which (to the extent consistent
with this Indenture) shall govern the terms of the Change of Control
Offer and shall state:
(i) that the Change of Control
Offer is being made pursuant to this Section 10.1 and that all
Securities, or portions thereof, tendered will be accepted for
payment;
(ii) the Change of Control Purchase
Price (including the amount of accrued and unpaid
interest) and the Change of Control Purchase Date;
(iii) that any Security, or portion
thereof, not tendered or accepted for payment will
continue to accrue interest;
(iv) that, unless the Company de-
faults in depositing cash with the Paying Agent in accordance
with the last paragraph of this subsection (b), or such
payment is prevented for any reason, any Security, or portion
thereof, accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change
of Control Purchase Date;
(v) that Holders electing to have a
Security, or portion thereof, purchased pursuant to a Change
of Control Offer will be required to surrender the Security,
with the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Security completed, to the Paying Agent
(which may not for purposes of this Section 10.1,
notwithstanding anything in this Indenture to the contrary, be
the Company or any Affiliate of the Company) at the address
specified in the
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notice prior to the expiration of the Change of Control Offer;
(vi) that Holders will be entitled
to withdraw their election, in whole or in part, if the Paying
Agent receives, prior to the expiration of the Change of
Control Offer, a facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the
Securities the Holder is withdrawing and a statement
containing a facsimile signature and stating that such Holder
is withdrawing his election to have such principal amount of
Securities purchased; and
(vii) a brief description of the events resulting
in such Change of Control Triggering Event.
Any Change of Control Offer will be made in compliance with
all applicable laws, rules and regulations including, if applicable, Regulation
14E under the Exchange Act and the rules thereunder and all other applicable
Federal and state securities laws and any provisions of this Indenture which
conflict with such laws shall be deemed to be superseded by the provisions of
such laws.
On or before the Change of Control Purchase Date, the Company
will (i) accept for payment Notes or portions thereof properly tendered pursuant
to the Change of Control Offer, (ii) deposit with the Paying Agent cash
sufficient to pay the Change of Control Purchase Price (together with accrued
and unpaid interest and Liquidated Damages, if any) of all Notes so tendered and
(iii) deliver to the Trustee Notes so accepted together with an Officers'
Certificate listing the Notes or portions thereof being purchased by the
Company. The Paying Agent will promptly pay to the Holders of Notes so accepted
an amount equal to the Change of Control Purchase Price (together with accrued
and unpaid interest), and the Trustee will promptly authenticate and deliver to
such Holders a new Note equal in principal amount to any unpurchased portion of
the Security surrendered. Any Notes not so accepted will be delivered promptly
by the Company to the Holder thereof. The Company publicly will announce the
results
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of the Change of Control Offer on or as soon as practicable after the
Change of Control Purchase Date.
ARTICLE XI
GUARANTEES
Section 1 Guarantees.
(a) In consideration of good and valuable consid-
eration, the receipt and sufficiency of which is hereby acknowledged, each of
the Guarantors hereby irrevocably and unconditionally guarantees, jointly and
severally, on a senior subordinated basis (the "Guarantee") to each Holder of a
Security authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of this
Indenture, the Securities or the obligations of the Company under this Indenture
or the Securities, that: (w) the principal and premium (if any) of and interest
(and Liquidated Damages, if any) on the Securities will be paid in full when
due, whether at the maturity or interest payment date, by acceleration, call for
redemption, upon an Change of Control Offer, an Asset Sale Offer or otherwise;
(x) all other obligations of the Company to the Holders or the Trustee under
this Indenture or the Securities will be promptly paid in full or performed, all
in accordance with the terms of this Indenture and the Securities; and (y) in
case of any extension of time of payment or renewal of any Securities or any of
such other obligations, they will be paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at maturity, by
acceleration, call for redemption, upon an Offer to Purchase or otherwise.
Failing payment when due of any amount so guaranteed for whatever reason, each
Guarantor shall be obligated to pay the same before failure so to pay becomes an
Event of Default.
(b) Each Guarantor hereby agrees that its obliga-
tions with regard to this Guarantee shall be unconditional, irrespective of the
validity, regularity or enforceability of the Securities or this Indenture, the
absence of any action to enforce the same, the recovery of any judgment against
the Company, any action to enforce the same or any other circumstances that
might otherwise constitute a legal or equitable discharge or defense of a
guarantor. Each Guarantor hereby
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waives diligence, presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company or right to require the prior disposition
of the assets of the Company to meet its obligations, protest, notice and all
demands whatsoever and covenants that this Guarantee will not be discharged
except by complete performance of the obligations contained in the Securities
and this Indenture.
(c) If any Holder or the Trustee is required by
any court or otherwise to return to either the Company or any Guarantor, or any
Custodian, Trustee, or similar official acting in relation to either the Company
or such Guarantor, any amount paid by either the Company or such Guarantor to
the Trustee or such Holder, this Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect. Each Guarantor agrees
that it will not be entitled to any right of subrogation in relation to the
Holders in respect of any obligations guaranteed hereby until payment in full of
all obligations guaranteed hereby. Each Guarantor further agrees that, as
between such Guarantor, on the one hand, and the Holders and the Trustee, on the
other hand, (i) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Section 2 for the purposes of this Guarantee,
notwithstanding any stay, injunction, or other prohibition preventing such
acceleration as to the Company of the obligations guaranteed hereby, and (ii) in
the event of any declaration of acceleration of those obligations as provided in
Section 2, those obligations (whether or not due and payable) will forthwith
become due and payable by each of the Guarantors for the purpose of this
Guarantee.
(d) Each Guarantor and, by its acceptance of a
Security issued hereunder, each Holder hereby confirms that it is the intention
of all such parties that the guarantee by such Guarantor set forth in Section
11.1(a) not constitute a fraudulent transfer or conveyance for purpose of any
Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar Federal or state law. To effectuate the foregoing
intention, the Holders and such Guarantor hereby irrevocably agree that the
obligations of such Guarantor under its guarantee set forth in Section 11.1(a)
shall be limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Guarantor and after
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giving effect to any collections from or payments made by or on behalf of
any other Guarantor in respect of the obligations of such other Guarantor
under its Guarantee or pursuant to the following paragraph of this
Section 11.1(d), result in the obligations of such Guarantor under such
guarantee not constituting such a fraudulent transfer or conveyance.
Each Guarantor that makes any payment or distribution under
Section 11.1(a) shall be entitled to a contribution from each other Guarantor
equal to its Pro Rata amount (as defined below) of such payment or distribution
so long as the exercise of such right does not impair the rights of the Holders
under the Guarantees. For purposes of the foregoing, the "Pro Rata amount" of
any Guarantor means the percentage of the total net assets of all Guarantors
held by such Guarantor, determined in accordance with GAAP.
Section 2 Execution and Delivery of Guarantee.
Each Guarantor shall, by virtue of such Guarantor's execution
and delivery of this Indenture or such Guarantor's execution and delivery of an
indenture supplement pursuant to Section 11.3 hereof, be deemed to have signed
on each Security issued hereunder the notation of guarantee set forth on the
form of the Securities attached hereto as Exhibit A to the same extent as if the
signature of such Guarantor appeared on such Security.
The delivery of any Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the guarantee
set forth in Section 11.1 on behalf of each Guarantor. The notation of a
guaranty set forth on any Security shall be null and void and of no further
effect with respect to the guaranty of any Guarantor which, pursuant to Section
11.4 or Section 11.5, is released from such guarantee.
Section 3 Certain Bankruptcy Events.
Each Guarantor hereby covenants and agrees that in the event
of the insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Company, such Guarantor shall not file (or join in any filing of), or otherwise
seek to participate in the filing of, any motion or request seeking to stay or
to prohibit (even temporarily) execution on the Guarantee and hereby waives
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and agrees not to take the benefit of any such stay of execution, whether under
Section 362 or 105 of the United States Bankruptcy Code or otherwise.
Section 4 Limitation on Merger, Consolidation, Etc.
of Guarantors.
No Guarantor shall consolidate or merge with or into (whether
or not such Guarantor is the surviving Person) another Person unless (i) subject
to the provisions of the following paragraph, the Person formed by or surviving
any such consolidation or merger (if other than such Guarantor) assumes all the
obligations of such Guarantor pursuant to a supplemental indenture in
form reasonably satisfactory to the Trustee, pursuant to which such
Person shall unconditionally guarantee, on a senior subordinated basis, all of
such Guarantor's obligations under such Guarantor's guarantee and the Indenture
on the terms set forth in the Indenture; and (ii) in addition, no Guarantor
shall consolidate or merge with or into another Person who is not a Guarantor
unless, immediately before and immediately after giving effect to such
transaction on a pro forma basis, no Default or Event of Default shall have
occurred and be continuing.
Notwithstanding the foregoing, upon the sale or disposition
(whether by merger, stock purchase, asset sale or otherwise) of a Guarantor or
all or substantially all of its assets to an entity which is not a Guarantor
(and a Restricted Subsidiary) or the designation of a Restricted Subsidiary to
become an Unrestricted Subsidiary, which transaction is otherwise in compliance
with the Indenture (including, without limitation, the provisions of Section
4.13), such Guarantor will be deemed released from its obligations under its
Guarantee of the Notes; provided, however, that any such termination shall occur
only to the extent that all obligations of such Guarantor under all of its
Guarantees of, and under all of its pledges of assets or other security
interests which secure, any Indebtedness of the Company or any other Restricted
Subsidiary shall also terminate upon such release, sale or transfer.
Section 5 Future Guarantors.
Upon the acquisition by the Company or any Guarantor of the
Capital Stock of any Person, if, as a result of such acquisi-
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tion, such Person becomes a Restricted Subsidiary, such Restricted Subsidiary
shall fully and unconditionally guarantee on a senior subordinated basis the
obligations of the Company with respect to payment and performance of the
Securities and the other obligations of the Company under this Indenture to the
same extent that such obligations are guaranteed by the other Guarantors
pursuant to Section 11.1; and, within 60 days of the date of such occurrence,
such Restricted Subsidiary shall execute and deliver to the Trustee a
supplemental indenture making such Restricted Subsidiary a party to this
Indenture.
ARTICLE XII
SUBORDINATION
Section 1 Securities Subordinated to Senior Indebt-
edness.
The Company, the Guarantors and each Holder, by its acceptance
of Securities, agree that (a) the payment of the principal of and interest on
the Securities and (b) any other payment in respect of the Securities, including
on account of the acquisition or redemption of the Securities by the Company or
the Guarantors (including, without limitation, pursuant to Section 13 or 10.1)
is subordinated, to the extent and in the manner provided in this Article XII,
to the prior payment in full in Cash or Cash Equivalents of all Senior
Indebtedness of the Company and the Guarantors (and is senior to all junior
indebtedness, including without limitation the Company's 8.75% Convertible
Subordinated Debentures Due May 30, 2006), and that these subordination
provisions are for the benefit of the holders of Senior Indebtedness.
This Article XII shall constitute a continuing offer to all
Persons who, in reliance upon such provisions, become holders of, or continue to
hold, Senior Indebtedness, and such provisions are made for the benefit of the
holders of Senior Indebtedness, and such holders are made obligees hereunder and
any one or more of them may enforce such provisions.
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Section 2 No Payment on Securities in Certain Cir-
cumstances.
(a) No payment (by set-off or otherwise) may be
made by or on behalf of the Company or a Guarantor, as applicable, on account of
the principal of, premium, if any, or interest or Liquidated Damages on the
Notes (including any repurchases of Notes), or on account of the redemption
provisions of the Notes, for cash or property (other than Junior Securities),
(i) upon the maturity of any Senior Indebtedness of the Company or such
Guarantor by lapse of time, acceleration (unless waived) or otherwise, unless
and until all principal of, premium, if any, the interest on such Senior
Indebtedness of the Company are first paid in full in cash or Cash Equivalents
(or such payment is duly provided for) or otherwise to the extent holders accept
satisfaction of amounts due by settlement in other than cash or Cash
Equivalents, or (ii) in the event of default in the payment of any principal of,
premium, if any, or interest on such Senior Indebtedness of the Company or such
Guarantor when it becomes due and payable, whether at maturity or at a date
fixed for prepayment or by declaration or otherwise (a "Payment Default"),
unless and until such Payment Default has been cured or waived or otherwise has
ceased to exist.
(b) Upon (i) the happening of an event of default
(other than a Payment Default) that permits the holders of Senior Indebtedness
to declare such Senior Indebtedness to be due and payable and (ii) written
notice of such event of default given to the Company and the Trustee by the
Agent under the Credit Agreement or the representative of the holders of an
aggregate of at least $15 million principal amount outstanding of any other
Senior Indebtedness or their representative (a "Payment Notice"), then, unless
and until such event of default has been cured or waived or otherwise has ceased
to exist, no payment (by set-off or otherwise) may be made by or on behalf of
the Company or any Guarantor which is an obligor under such Senior Indebtedness
on account of the principal of, premium, if any, or interest or Liquidated
Damages on the Notes (including any repurchases of any of the Notes), or on
account of the redemption provisions of the Notes, other than payments with
Junior Securities. Notwithstanding the foregoing, unless the Senior Indebtedness
in respect of which such event of default exists has been declared due and
payable in its entirety within 179 days after the Payment Notice
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is delivered as set forth above (the "Payment Blockage Period") (and such
declaration has not been rescinded or waived), at the end of the Payment
Blockage Period, the Company and the Guarantors shall be required to pay, all
sums not paid to the Holders of the Notes during the Payment Period due to the
foregoing prohibitions and to resume all other payments as and when due on the
Notes. Any number of Payment Notices may be given; provided, however, that (i)
not more than one Payment Blockage Notice shall be given within a period of any
360 consecutive days, and (ii) no default that existed upon the date of such
Payment Notice or the commencement of such Payment Blockage Period (whether or
not such event of default is on the same issue of Senior Indebtedness) shall be
made the basis for the commencement of any other Payment Blockage Period.
(c) In furtherance of the provisions of Section
12.1, in the event that, notwithstanding the foregoing provisions of this
Section 12.2 or the provisions of Section 12.3, any payment or distribution of
assets of the Company or any Guarantor (other than Junior Securities) shall be
received by the Trustee at a time when such payment or distribution is
prohibited by such provisions, such payment or distribution shall be held in
trust for the benefit of the holders of such Senior Indebtedness, and shall be
paid or delivered by the Trustee, to the holders of such Senior Indebtedness
remaining unpaid or unprovided for or to their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any of such Senior Indebtedness may have been
issued, ratably according to the aggregate principal amounts remaining unpaid on
account of such Senior Indebtedness held or represented by each, for application
to the payment of all such Senior Indebtedness remaining unpaid, to the extent
necessary to pay or to provide for the payment of all such Senior Indebtedness
in full in cash or Cash Equivalents or otherwise to the extent holders accept
satisfaction of amounts due by settlement in other than cash or Cash Equivalents
after giving effect to any concurrent payment or distribution to the holders of
such Senior Indebtedness.
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Section 3 Securities Subordinated to Prior Payment
of All Senior Indebtedness on Dissolution, Liquidation or Reorga-
nization.
Upon any distribution of assets of the Company or any
Guarantor upon any dissolution, winding up, total or partial liquidation or
reorganization of the Company or a Guarantor, whether voluntary or involuntary,
in bankruptcy, insolvency, receivership or a similar proceeding or upon
assignment for the benefit of creditors or any marshalling of assets or
liabilities:
(i) the holders of all Senior Indebted-
ness of the Company or such Guarantor, as applicable, will first be
entitled to receive payment in full in cash or Cash Equivalents (or
have such payment duly provided for) or otherwise to the extent holders
accept satisfaction of amounts due by settlement in other than cash or
Cash Equivalents before the Holders are entitled to receive any payment
on account of principal of, premium, if any, and interest on the Notes
(other than Junior Securities); and
(ii) any payment or distribution of
assets of the Company or such Guarantor of any kind or character from
any source, whether in cash, property or securities (other than Junior
Securities) to which the Holders or the Trustee on behalf of the
Holders would be entitled (by set-off or otherwise), except for the
provisions of Article VIII, will be paid by the liquidating trustee or
agent or other Person making such a payment or distribution directly to
the holders of such Senior Indebtedness or their representative to the
extent necessary to make payment in full in cash or Cash Equivalents
(or have such payment duly provided for) on all such Senior
Indebtedness remaining unpaid, after giving effect to any concurrent
payment or distribution to the holders of such Senior Indebtedness.
Section 4 Securityholders to Be Subrogated to
Rights of Holders of Senior Indebtedness.
Subject to the payment in full in Cash or Cash Equivalents of
all Senior Indebtedness of the Company and the Guaran-
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tors as provided herein, the Holders of Securities shall be subrogated to the
rights of the holders of such Senior Indebtedness to receive payments or
distributions of assets of the Company and the Guarantors applicable to the
Senior Indebtedness until all amounts owing on the Securities shall be paid in
full, and for the purpose of such subrogation no such payments or distributions
to the holders of such Senior Indebtedness by or on behalf of the Company or the
Guarantors, or by or on behalf of the Holders by virtue of this Article XII,
which otherwise would have been made to the Holders shall, as between the
Company and Guarantors and the Holders, be deemed to be payment by the Company
or Guarantors or on account of such Senior Indebtedness, it being understood
that the provisions of this Article XII are and are intended solely for the
purpose of defining the relative rights of the Holders, on the one hand, and the
holders of such Senior Indebtedness, on the other hand.
If any payment or distribution to which the Holders would
otherwise have been entitled but for the provisions of this Article XII shall
have been applied, pursuant to the provisions of this Article XII, to the
payment of amounts payable under Senior Indebtedness of the Company or the
Guarantors, then the Holders shall be entitled to receive from the holders of
such Senior Indebtedness any payments or distributions received by such holders
of Senior Indebtedness in excess of the amount sufficient to pay all amounts
payable under or in respect of such Senior Indebtedness in full in Cash or Cash
Equivalents.
Section 5 Obligations of the Company Unconditional.
Nothing contained in this Article XII or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as between the
Company and Guarantors and the Holders, the obligation of each such Person,
which is absolute and unconditional, to pay to the Holders the principal of,
premium, if any, and interest and Liquidated Damages on the Securities as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company and the Guarantors other than the holders of the Senior
Indebtedness, nor shall anything herein or therein prevent the Trustee or any
Holder from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the
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rights, if any, under this Article XII and under the proviso to Section 2, of
the holders of Senior Indebtedness in respect of cash, property or securities of
the Company or the Guarantors received upon the exercise of any such remedy or
otherwise. Notwithstanding anything to the contrary in this Article XII or
elsewhere in this Indenture or in the Securities, upon any distribution of
assets of the Company referred to in this Article XII, the Trustee, subject to
the provisions of Sections 7.1 and 7.2, and the Holders shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction in
which such dissolution, winding up, liquidation or reorganization proceedings
are pending, or a certificate of the liquidating Trustee or agent or other
Person making any distribution to the Trustee or to the Holders for the purpose
of ascertaining the Persons entitled to participate in such distribution, the
holders of the Senior Indebtedness and other Indebtedness of the Company and the
Guarantors, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article XII
so long as such court has been apprised of the provisions of, or the order,
decree or certificate makes reference to, the provisions of this Article XII.
Nothing in this Section 12.5 shall apply to the claims of, or payments to, the
Trustee under or pursuant to Section 7.
Section 6 Trustee Entitled to Assume Payments Not
Prohibited in Absence of Notice.
The Trustee shall not at any time be charged with knowledge of
the existence of any facts which would prohibit the making of any payment to or
by the Trustee unless and until a Trust Officer of the Trustee or any Paying
Agent shall have received, no later than two Business Days prior to such
payment, written notice thereof from the Company or from one or more holders of
Senior Indebtedness or from any representative therefor and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
Sections 7.1 and 7.2, shall be entitled in all respects conclusively to assume
that no such fact exists. The Company shall give prompt written notice to the
Trustee of any fact actually known to the Company which would prohibit the
making of any payment to or by the Trustee in respect of the Securities.
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Section 7 Application by Trustee of Assets
Deposited with It.
Amounts deposited in trust with the Trustee pursuant to and in
accordance with Article VIII shall be for the sole benefit of Securityholders
and, to the extent allocated for the payment of Securities, shall not be subject
to the subordination provisions of this Article XII. Otherwise, any deposit of
assets with the Trustee or any Paying Agent (whether or not in trust) for the
payment of principal of or interest on any Securities shall be subject to the
provisions of Sections 12.1, 12.2, 12.3 and 12.4; provided that, if prior to two
Business Days preceding the date on which by the terms of this Indenture any
such assets may become distributable for any purpose (including without
limitation, the payment of either principal of or interest on any Security) the
Trustee or such Paying Agent shall not have received with respect to such assets
the written notice provided for in Section 12.6, then the Trustee or such Paying
Agent shall have full power and authority to receive such assets and to apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary which may be received by it on or after such date.
Section 8 Subordination Rights Not Impaired by Acts or
Omissions of the Company, Guarantors or Holders of Senior Indebtedness, Etc.;
Modifications.
No right of any present or future holders of any Senior
Indebtedness to enforce subordination provisions contained in this Article XII
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company, the Guarantors or by any act or failure to act,
in good faith, by any such holder, or by any noncompliance by the Company or the
Guarantors with the terms of this Indenture, regardless of any knowledge thereof
which any such holder may have or be otherwise charged with. The holders of
Senior Indebtedness may extend, renew, modify or amend the terms of the Senior
Indebtedness or any security therefor and release, sell or exchange such
security and otherwise deal freely with the Company and the Guarantors, all
without affecting the liabilities and obligations of the parties to this
Indenture or the Holders. The subordination provisions are solely for the
benefit of the holders from time to time of Senior Indebtedness and may not be
rescinded, cancelled,
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amended or modified in any way other than any amendment or modification that
would not adversely affect the rights of any holder of Senior Indebtedness or
any amendment or modification that is consented to by each holder of Senior
Indebtedness that would be affected thereby. The subordination provisions of
this Article XII shall continue to be effective or be reinstated, as the case
may be, if at any time payment and performance of the Senior Indebtedness is,
pursuant to applicable law, avoided, recovered or rescinded or must otherwise be
restored or returned by any holder of Senior Indebtedness, whether as a
"voidable preference," "fraudulent conveyance," "fraudulent transfer," or
otherwise, all as though such payment or performance had not been made.
Section 9 Securityholders Authorize Trustee to
Effectuate Subordination of Securities.
Each Holder of the Securities by his acceptance thereof
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination provisions
contained in this Article XII and to protect the rights of the Holders pursuant
to this Indenture, and appoints the Trustee his attorney-in-fact for such
purpose, including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company or any Guarantor (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment for the benefit of
creditors or any other marshalling of assets and liabilities of the Company and
the Guarantors) the immediate filing of a claim for the unpaid balance of his
Securities in the form required in said proceedings and cause said claim to be
approved. If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of the Senior Indebtedness
or their representative are or is hereby authorized to have the right to file
and are or is hereby authorized to file an appropriate claim for and on behalf
of the Holders of said Securities. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Senior Indebtedness or their
representative to authorize or consent to or accept or adopt on behalf of any
Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee or the holders of
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Senior Indebtedness or their representative to vote in respect of the claim of
any Securityholder in any such proceeding.
Section 10 Right of Trustee to Hold Senior Indebtedness.
The Trustee shall be entitled to all of the rights set forth
in this Article XII in respect of any Senior Indebtedness at any time held by it
to the same extent as any other holder of Senior Indebtedness, and nothing in
this Indenture shall be construed to deprive the Trustee of any of its rights as
such holder.
Section 11 Article XII Not to Prevent Events of Default.
The failure to make a payment on account of principal of,
premium, if any, or interest on the Securities by reason of any provision of
this Article XII shall not be construed as preventing the occurrence of a
Default or an Event of Default under Section 1 or in any way limit the rights
of the Trustee or any Holder to pursue any other rights or remedies with respect
to the Securities.
Section 12 No Fiduciary Duty of Trustee to Holders of Senior
Indebtedness.
Notwithstanding anything to the contrary herein, the Trustee
shall not be deemed to owe any fiduciary duty to any present or future holders
of Senior Indebtedness, and shall not be liable to any such holders (other than
for its willful misconduct or negligence) if it shall in good faith mistakenly
pay over or distribute to the Holders of Securities or the Company or Guarantors
or any other Person, cash, property or securities to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article XII or otherwise. The
Trustee undertakes to perform or to observe only such of the covenants and
obligations as are specifically set forth in this Article XII, and no implied
covenants or obligations with respect to such holders of Senior Indebtedness
shall be implied in this Indenture against the Trustee. Nothing in this Section
12.12 shall affect the obligation of any other such Person to hold such payment
for the benefit of, and to pay such payment over to, the holders of
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Senior Indebtedness or their representative. In the event of any conflict
between the fiduciary duty of the Trustee to the Holders of Securities and its
duty to the holders of Senior Indebtedness, the Trustee is expressly authorized
to resolve such conflict in favor of the Holders.
ARTICLE XIII
MISCELLANEOUS
Section 1 TIA Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with the duties imposed by operation of the TIA, the imposed duties,
upon qualification of this Indenture under the TIA, shall control.
Section 2 Notices.
Any notices or other communications to the Company, the
Guarantors or the Trustee required or permitted hereunder shall be in writing,
and shall be sufficiently given if made by hand delivery, by telecopier or
registered or certified mail, postage prepaid, return receipt requested, or by
overnight courier addressed as follows:
if to the Company or any Guarantor:
UROHEALTH Systems, Inc.
0 Xxxxx Xxxxx Xxxx., Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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if to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
The Company, the Guarantors or the Trustee by notice to each
other party may designate additional or different addresses as shall be
furnished in writing by such party. Any notice or communication to the Company,
the Guarantors or the Trustee shall be deemed to have been given or made as of
the date so delivered, if personally delivered; when receipt is acknowledged, if
telecopied; and 5 Business Days after mailing if sent by registered or certified
mail, postage prepaid (except that a notice of change of address shall not be
deemed to have been given until actually received by the addressee).
Any notice or communication mailed to a Securityholder shall
be mailed to him by first class mail or other equivalent means at his address as
it appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
Section 3 Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b)
with other Securityholders with respect to their rights under this Indenture or
the Securities. The Company, the Guarantors, the Trustee, the Registrar and any
other Person shall have the protection of TIA Section 312(c).
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Section 4 Certificate and Opinion as to Conditions
Precedent.
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate (in form and substance
reasonably satisfactory to the Trustee) stating that, in the opinion of
the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel (in form and substance
reasonably satisfactory to the Trustee) stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
Section 5 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the Person
making such certificate or opinion has read such cove-
nant or condition;
(2) a brief statement as to the
nature and scope of the examination or investigation
upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opin-
ion of such Person, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(4) a statement as to whether or
not, in the opinion of each such Person, such condition
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or covenant has been complied with; provided, however, that with
respect to matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials.
Section 6 Rules by Trustee, Paying Agent,
Registrar.
The Trustee may make reasonable rules for action by or
at a meeting of Securityholders. The Paying Agent or Registrar
may make reasonable rules for its functions.
Section 7 Legal Holidays.
A "Legal Holiday" used with respect to a particular place of
payment is a Saturday, a Sunday or a day on which banking institutions in New
York, New York are not required to be open. If a payment date is a Legal Holiday
in New York, New York, payment may be made at such place on the next succeeding
day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
Section 8 Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AS
APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY AND EACH GUARANTOR HEREBY
IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE AND THE SECURITIES,
AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY AND EACH
GUARANTOR IRREVOCABLY WAIVE, TO THE FULLEST EXTENT THEY MAY EFFECTIVELY DO SO
UNDER APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION WHICH THEY MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY SECURITYHOLDER TO SERVE
PROCESS IN ANY
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OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST THE COMPANY OR ANY GUARANTOR IN ANY OTHER
JURISDICTION.
Section 9 No Adverse Interpretation of Other
Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of any of the Company, the Guarantors or any of their
Subsidiaries. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
Section 10 No Recourse Against Others.
No direct or indirect stockholder, employee, officer or
director, as such, past, present or future of the Company, the Guarantors or any
successor entity shall have any personal liability in respect of the obligations
of the Company or the Guarantors under this Indenture or the Notes by reason of
its status as such stockholder, employee, officer or director, except to the
extent such Person is the Company or a Guarantor. Each Holder of a Security by
accepting a Security waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of the Securities.
Section 11 Successors.
All agreements of the Company and the Guarantors in this
Indenture and the Securities shall bind their successors. All agreements of the
Trustee in this Indenture shall bind its successor.
Section 12 Duplicate Originals.
All parties may sign any number of copies or counterparts of
this Indenture. Each signed copy or counterpart shall be an original, but all of
them together shall represent the same agreement.
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Section 13 Severability.
In case any one or more of the provisions in this Indenture or
in the Securities shall be held invalid, illegal or unenforceable, in any
respect for any reason, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions shall not in
any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.
Section 14 Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table and headings of
the Articles and the Sections of this Indenture have been inserted for
convenience of reference only, are not to be considered a part hereof and shall
in no way modify or restrict any of the terms or provisions hereof.
114
124
SIGNATURE
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
UROHEALTH SYSTEMS, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President
and Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
THE BANK OF NEW YORK
By: /s/ XXXXXX XXXXXXX
----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Assistant Vice President
125
GATES PLASTICS
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
DACOMED CORPORATION
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President
and Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
DACOMED INTERNATIONAL, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
126
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
ALLSTATE MEDICAL PRODUCTS, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
UROHEALTH OF KENTUCKY, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
127
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
128
MICROSURGE, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
XXXXX MEDICAL SYSTEMS, LTD.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
NT REUDT CORPORATION
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
129
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
INTERMED ASSOCIATES, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
LAPAROMED CORPORATION
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
130
Title: Senior Vice President, Gen-
eral Counsel and Secretary
ADVANCED UROCARE, INC.
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
UROHEALTH, INC. (CALIFORNIA)
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
By: /s/ XXXXX X. XXXXXXX
----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Senior Vice President, Gen-
eral Counsel and Secretary
131
EXHIBIT A
[FORM OF NOTE]
UROHEALTH SYSTEMS, INC.
12.5% SENIOR SUBORDINATED NOTES
DUE 2004
Unless and until it is exchanged in whole or in part for
Securities in definitive form, this Security may not be transferred except as a
whole by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee of such
successor Depository. Unless this certificate is presented by an authorized
representative of The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx) ("XXX"), to the Company or their agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or such other name as requested by an authorized representative of
DTC (and any payment is made to Cede & Co. or such other entity as is requested
by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL for so long as the
registered owner hereof, Cede & Co., has an interest herein.(1)
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER XXXXXXX 0 XX XXX XXXXXX XXXXXX SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED
HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE
------------------------
(1) This paragraph should only be added if the Security is
issued in global form.
A-1
132
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS
HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE
BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (1)(A) TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (B) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (C) OUTSIDE THE
UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR (D) IN ACCORDANCE
WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED IN THE CASE OF (B), (C) AND (D) UPON AN
OPINION OF COUNSEL IF THE COMPANY SO REQUESTS), (2) TO THE COMPANY OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE,
IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET
FORTH IN (A) ABOVE.
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133
CUSIP NO.______
No. $
UROHEALTH Systems, Inc., a Delaware corporation (the
"Company") which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promise, jointly and
severally, to pay to _____, or registered assigns, the principal sum of _____
Dollars, on April 1, 2004.
Interest Payment Dates: April 1 and October 1.
Record Dates: March 15 and September 15.
Reference is made to the further provisions of this Security
on the reverse side, which will, for all purposes, have the same effect as if
set forth at this place.
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134
IN WITNESS WHEREOF, the Company have caused this Instrument to
be duly executed under its corporate seal.
UROHEALTH SYSTEMS, INC.
By:
----------------------------------------
Name:
Title:
Attest: _______________
135
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the within-
mentioned Indenture.
Dated:
THE BANK OF NEW YORK
As Trustee
By:
----------------------------------------
Authorized Signatory
A-5
136
UROHEALTH SYSTEMS, INC.
12.5% SENIOR SUBORDINATED NOTES
DUE 2004
1. Interest.
UROHEALTH Systems, Inc., a Delaware corporation (the
"Company"), jointly and severally, promise to pay interest on the principal
amount of this Security at a rate of 12.5% per annum. To the extent it is
lawful, the Company promises to pay interest on any interest payment due but
unpaid on such principal amount at a rate of 12.5% per annum compounded
semiannually.
The Company will pay interest semiannually on April 1 and
October 1 of each year (each, an "Interest Payment Date"), commencing October 1,
1997. Interest on the Securities will accrue from the date of issuance or from
the most recent date to which interest has been paid on the Securities pursuant
to the Indenture. Interest will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
2. Method of Payment.
The Company shall pay interest (and Liquidated Damages, if
any) on the Securities (except defaulted interest) to the Persons who are the
registered Holders at the close of business on the Record Date immediately
preceding the Interest Payment Date. Holders must surrender Securities to a
Paying Agent to collect principal payments. Except as provided below, the
Company shall pay principal and interest (and Liquidated Damages, if any) in
such coin or currency of the United States of America as at the time of payment
shall be legal tender for payment of public and private debts ("Cash"). The
Securities will be payable as to principal, premium and interest (and Liquidated
Damages, if any) at the office or agency of the Company maintained for such
purpose within the City and State of New York or, at the option of the Company,
payment of principal, premium and interest (and Liquidated Damages, if any) may
be made by check mailed to the Holders at their addresses set forth in the
register of
A-6
137
Holders, and provided that payment by wire transfer of immediately
available funds will be required with respect to principal of and interest (and
Liquidated Damages, if any) and premium on all Global Securities and all other
Securities the Holders of which shall have provided, prior to the relevant
Record Date, written wire transfer instructions to the Company and the Paying
Agent.
3. Paying Agent and Registrar.
Initially, The Bank of New York (the "Trustee") will act as
Paying Agent and Registrar. The Company may change any Paying Agent, Registrar
or Co-registrar without notice to the Holders. The Company or any of their
respective Subsidiaries may, subject to certain exceptions, act as Paying Agent,
Registrar or Co-registrar.
4. Indenture.
The Company issued the Securities under an Indenture, dated as
of April 10, 1997 (the "Indenture"), among the Company, the Guarantors named
therein and the Trustee. Capitalized terms herein are used as defined in the
Indenture unless otherwise defined herein. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act, as in effect on the date of the Indenture. The
Securities are subject to all such terms, and Holders of Securities are referred
to the Indenture and said Act for a statement of them. The Securities are senior
subordinated obligations of the Company limited in aggregate principal amount to
$110,000,000.
5. Redemption.
Except as provided in this Paragraph 5 or as provided in
Article III of the Indenture, the Company shall not have the right to redeem any
Securities prior to April 1, 2001. The Notes will be redeemable for cash at the
option of the Company, in whole or in part at any time on or after April 1,
2001, upon not less than 30 days nor more than 60 days notice to each Holder of
Notes, at the following Redemption Price (expressed as a percentage of principal
amount),
A-7
138
if redeemed during the 12-month period commencing April 1 of each of
the years indicated below, in each case (subject to the right of Holders of
record on the Record Date to receive interest due on an Interest Payment Date
that is on or prior to such Redemption Date), together with any accrued but
unpaid interest and Liquidated Damages, if any, to the Redemption Date:
Year Redemption Price
---- ----------------
2001 ................................ 106.250%
2002 ................................ 103.125%
2003 and thereafter.................. 100.000%
Until April 1, 2000, upon a Public Equity Offering of Common
Stock resulting in net cash proceeds to the Company of at least $40 million, up
to 35% of the aggregate principal amount of the Notes may be redeemed at the
option of the Company within 120 days of such Public Equity Offering, on not
less than 30 days, but not more than 60 days notice to each Holder of the Notes
to be redeemed, with cash from the Net Cash Proceeds of such Public Equity
Offering, at a redemption price equal to 112 1/2% of the principal amount to be
redeemed (subject to the right of Holders of record on a Record Date to receive
interest due on an Interest Payment Date that is on or prior to such Redemption
Date), together with accrued and unpaid interest and Liquidated Damages, if any,
to the date of redemption; provided, however, that immediately following such
redemption not less than 65% of the aggregate principal amount of the Securities
remain outstanding.
Any redemption of the Securities shall comply with Article III
of the Indenture.
6. Notice of Redemption.
Notice of redemption will be sent by first class mail at least
30 days but not more than 60 days prior to the date fixed for redemption to the
Holder of each Note to be redeemed to such Holder's last address as then shown
upon the registry books of the Registrar. Any notice which relates to a Note to
be redeemed in part only must state the portion of
A-8
139
the principal amount equal to the redeemed portion thereof and must state that
on and after the date of redemption, upon surrender of such Note, a new Note or
Notes in a principal amount equal to the unredeemed portion thereof will be
issued. On and after the date of redemption, interest will cease to accrue on
the Notes or portions thereof called for redemption, unless the Company defaults
in the payment thereof.
7. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder may register
the transfer of, or exchange Securities in accordance with, the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption (except the unredeemed
portion of Securities being redeemed in parts) or any Security for a period
beginning 15 Business Days before the mailing of a notice of an offer to
purchase.
A-9
140
8. Persons Deemed Owners.
The registered Holder of a Security may be treated as the
owner of it for all purposes.
9. Unclaimed Money.
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee and the Paying Agent(s) will pay the money
back to the Company at its written request. After that, all liability of the
Trustee and such Paying Agent(s) with respect to such money shall cease.
10. Discharge Prior to Redemption or Maturity.
If the Company at any time deposit into an irrevocable trust
with the Trustee Cash or U.S. Government Obligations sufficient to pay the
principal of and interest (and Liquidated Damages, if any) on the Securities to
redemption or maturity and comply with the other provisions of the Indenture
relating thereto, the Company will be discharged from certain provisions of the
Indenture and the Securities (including the financial covenants, but excluding
its obligation to pay the principal of and interest (and Liquidated Damages, if
any) on the Securities).
11. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities
may be amended or supplemented with the written consent of the Holders of a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default or compliance with any provision may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend or supplement the Indenture or the
Securities to, among other things, cure any ambiguity, defect or inconsistency,
comply with the TIA or make any other change that does not adversely affect the
rights of any Holder of a Security.
X-00
000
00. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of
the Company and their respective Subsidiaries to, among other things, incur
additional Indebtedness and Disqualified Capital Stock, make payments in respect
of its Capital Stock, enter into transactions with Affiliates, incur Liens,
merge or consolidate with any other Person and sell, lease, transfer or
otherwise dispose of substantially all of its properties or assets. The
limitations are subject to a number of important qualifications and exceptions.
The Company must annually report to the Trustee on compliance with such
limitations.
13. Change of Control.
In the event there shall occur any Change of Control, each
Holder of Securities shall have the right, at such Holder's option but subject
to the limitations and conditions set forth in the Indenture, to require the
Company to purchase on the Change of Control Purchase Date in the manner
specified in the Indenture, all or any part (in integral multiples of $1,000) of
such Holder's Securities at a cash price equal to 101% of the principal amount
thereof, together with accrued and unpaid interest (and Liquidated Damages, if
any) to and including the Change of Control Purchase Date.
14. Certain Asset Sales.
The Indenture imposes certain limitations on the ability of
the Company to sell assets. In the event the proceeds from a permitted Asset
Sale exceed certain amounts, as specified in the Indenture, the Company
generally will be required either to reinvest the proceeds of such Asset Sale in
its business, use such proceeds to retire debt, or to make an asset sale offer
to purchase a certain amount of each Holder's Securities at 100% of the
principal amount thereof, plus accrued interest, if any, to the purchase date,
as more fully set forth in the Indenture
15. Ranking.
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142
Payment of principal, premium, if any, and interest on the
Securities is subordinated, in the manner and to the extent set forth in the
Indenture, to the prior payment in full of all Senior Indebtedness.
16. Security.
The Holders shall have the benefit of an exclusive first
priority security interest in the account holding all Government Securities, and
all other cash or property, pledged pursuant to the Security Agreement.
17. Successors.
When a successor assumes all the obligations of its
predecessor under the Securities and the Indenture, the predecessor will be
released from those obligations.
18. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Securities. Subject to certain limitations,
Holders of a majority in aggregate principal amount of the Securities then
outstanding may direct the Trustee in its exercise of any trust or power.
19. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its respective Affiliates, and may otherwise deal with the
Company or its Affiliates as if it were not the Trustee.
X-00
000
00. No Personal Liability of Partners, Stockholders,
Officers and Directors.
No direct or indirect stockholder, employee, officer or
director, as such, past, present or future of the Company, the Guarantors or any
successor entity shall have any personal liability in respect of the obligations
of the Company or the Guarantors under or the Indenture or the Notes by reason
of its status as such stockholder, employee, officer or director, except to the
extent such Person is the Company or a Guarantor. Each Holder of a Security by
accepting a Security waives and releases all such liability. The waiver and
release are part of the consideration for the issuance of the Securities.
21. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on the other side
of this Security.
22. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company will cause CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
X-00
000
00. Governing Law.
The Indenture and the Securities shall be governed by and
construed in accordance with the internal laws of the State of New York.
A-14
145
[FORM OF ASSIGNMENT]
I or we assign this Security to
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type name, address and zip code of assignee)
Please insert Social Security or other identifying
number of assignee _________________
and irrevocably appoint ___________ agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
Dated: __________ Signed:_____________________________________________________
___________________________________________________________________
(Sign exactly as your name appears on the other side of
this Security)
Signature guarantee:________________________________
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146
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 13 or Article X of the Indenture, check the
appropriate box:
[ ] Section 13
[ ] Article X
If you want to elect to have only part of this Security
purchased by the Company pursuant to the Indenture, state the principal amount
you want to have purchased:
$______
Date: ________________ Signature:_____________________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature guarantee:_______________________
A-16
147
SCHEDULE OF EXCHANGES OF DEFINITIVE SECURITIES(2)
The following exchanges of a part of this Global Security for
Definitive Securities have been made:
Signature
Amount of Amount of Principal Amount authorized
decrease in increase in of this Global signatory of
Principal Amount Principal Amount Security following Trustee or
of this Global of this Global such decrease (or Securities
Date of Exchange Security Security increase) Custodian
-----------------------------------------------------------------------------------------------------------------------------
-------------------------
(2) This schedule should only be added if the Security is issued
in global form.
A-17
148
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF
TRANSFER OF SECURITIES(3)
Re: 12.5% SENIOR SUBORDINATED NOTES DUE 2004 OF UROHEALTH
SYSTEMS, INC.
This Certificate relates to $______ principal amount of Securities held
in (4) [_] book-entry or [_] definitive form by _______ (the "Transferor").
The Transferor:
[_] has requested the Trustee by written order to deliver in exchange for its
beneficial interest in the Global Security held by the Depository a Security or
Securities in definitive, registered form of authorized denominations and an
aggregate principal amount equal to its beneficial interest in such Global
Security (or the portion thereof indicated above); or
[_] has requested the Trustee by written order to exchange or register the
transfer of a Security or Securities.
In connection with such request and in respect of each such
Security, the Transferor does hereby certify that Transferor is familiar with
the Indenture relating to the above-captioned Securities and as provided in
Section 6 of such Indenture, the transfer of this Security does not require
registration under the Securities Act (as defined below) because:(5)
_____________________________
(3) The following should be included only for Original Notes.
(4) Check applicable box.
A-18
149
[_] Such Security is being acquired for the Transferor's own account, without
transfer (in accordance with Section 6(a)(ii)(A) or Section 6(d)(i)(A) of
the Indenture).
[_] Such Security is being transferred to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act")) in reliance on Rule 144A (in accordance with Section
6(a)(ii)(B) or Section 6(d)(i)(B) of the Indenture).
[_] Such Security is being transferred in accordance with (i) Rule 144 or
Regulation S under the Securities Act, (ii) pursuant to an effective
registration statement under the Securities Act, or (iii) in reliance on another
exemption from registration under the Securities Act (in satisfaction of Section
2.6(a)(ii)(C) or Section 6(d)(i)(C) of the Indenture). To effect such
transfer, delivery of an Opinion of Counsel is required.
______________________________________
[INSERT NAME OF TRANSFEROR]
______________________________________
By:
Dated:____________________
A-19
150
EXHIBIT B
FORM OF GUARANTEE
For value received, __________________, a _______________ corporation,
hereby irrevocably, unconditionally guarantees on a senior subordinated basis to
the Holder of the Security upon which this Guarantee is endorsed the due and
punctual payment, as set forth in the Indenture pursuant to which such Security
and this Guarantee were issued, of the principal of, premium (if any) and
interest (and Liquidated Damages, if any) on such Security when and as the same
shall become due and payable for any reason according to the terms of such
Security and Article XI of the Indenture. The Guarantee of the Security upon
which this Guarantee is endorsed will not become effective until the Trustee
signs the certificate of authentication on such Security.
______________________________
By:___________________________
______________________________
Attest:
B-1
