EXHIBIT 4.1
EXECUTION VERSION
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GENERAL NUTRITION CENTERS, INC.
and each of the Guarantors PARTY HERETO
8-5/8% SENIOR NOTES DUE 2011
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INDENTURE
Dated as of January 18, 2005
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U.S. Bank National Association
Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
--------------- -----------------
310(a)(1)...................................................... 7.10
(a)(2).................................................... 7.10
(a)(3).................................................... N.A.
(a)(4).................................................... N.A.
(a)(5).................................................... 7.10
(b)....................................................... 7.10
(c)....................................................... N.A.
311(a)......................................................... 7.11
(b)....................................................... 7.11
(c)....................................................... N.A.
312(a)......................................................... 2.05
(b)....................................................... 12.03
(c)....................................................... 12.03
313(a)......................................................... 7.06
(b)(1).................................................... N.A.
(b)(2).................................................... 7.06; 7.07
(c)....................................................... 7.06; 12.02
(d)....................................................... 7.06
314(a).........................................................4.03;12.02; 12.05
(b)....................................................... N.A
(c)(1).................................................... 12.04
(c)(2).................................................... 12.04
(c)(3).................................................... N.A.
(d)....................................................... N.A.
(e)....................................................... 12.05
(f)....................................................... N.A.
315(a)......................................................... 7.01
(b)....................................................... 7.05; 12.02
(c)....................................................... 7.01
(d)....................................................... 7.01
(e)....................................................... 6.11
316(a) (last sentence)......................................... 2.09
(a)(1)(A)................................................. 6.05
(a)(1)(B)................................................. 6.04
(a)(2).................................................... N.A.
(b)....................................................... 6.07
(c)....................................................... 2.12
317(a)(1)...................................................... 6.08
(a)(2).................................................... 6.09
(b)....................................................... 2.04
318(a)......................................................... 12.01
(b)....................................................... N.A.
(c)....................................................... 12.01
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N.A. means not applicable.
* This Cross Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions...................................................1
Section 1.02 Other Definitions............................................27
Section 1.03 Incorporation by Reference of Trust Indenture Act............27
Section 1.04 Rules of Construction........................................28
ARTICLE 2
THE NOTES
Section 2.01 Form and Dating..............................................28
Section 2.02 Execution and Authentication.................................29
Section 2.03 Registrar and Paying Agent...................................30
Section 2.04 Paying Agent to Hold Money in Trust..........................30
Section 2.05 Holder Lists.................................................31
Section 2.06 Transfer and Exchange........................................31
Section 2.07 Replacement Notes............................................43
Section 2.08 Outstanding Notes............................................43
Section 2.09 Treasury Notes...............................................44
Section 2.10 Temporary Notes..............................................44
Section 2.11 Cancellation.................................................44
Section 2.12 Defaulted Interest...........................................44
Section 2.13 Issuance of Additional Notes.................................44
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee...........................................45
Section 3.02 Selection of Notes to Be Redeemed or Purchased...............45
Section 3.03 Notice of Redemption.........................................46
Section 3.04 Effect of Notice of Redemption...............................46
Section 3.05 Deposit of Redemption or Purchase Price......................47
Section 3.06 Notes Redeemed or Purchased in Part..........................47
Section 3.07 Optional Redemption..........................................47
Section 3.08 Mandatory Redemption.........................................48
Section 3.09 Offer to Purchase by Application of Excess Proceeds..........48
ARTICLE 4
COVENANTS
Section 4.01 Payment of Notes.............................................50
Section 4.02 Maintenance of Office or Agency..............................50
Section 4.03 Reports......................................................50
Section 4.04 Compliance Certificate.......................................51
Section 4.05 Taxes........................................................52
Section 4.06 Stay, Extension and Usury Laws...............................52
Section 4.07 Limitation on Restricted Payments............................52
Section 4.08 Limitation on Restrictions on Distributions from
Restricted Subsidiaries....................................55
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Section 4.09 Limitation on Indebtedness...................................57
Section 4.10 Limitation on Asset Dispositions.............................59
Section 4.11 Limitation on Transactions with Affiliates...................61
Section 4.12 Limitation on Liens..........................................63
Section 4.13 Limitation on the Sale or Issuance of Preferred Stock of
Restricted Subsidiaries....................................63
Section 4.14 Corporate Existence..........................................63
Section 4.15 Offer to Repurchase Upon Change of Control...................64
Section 4.16 No Amendment to Subordination Provisions.....................65
Section 4.17 Additional Note Guarantees...................................65
Section 4.18 Designation of Unrestricted Subsidiaries.....................65
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets..................66
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default............................................67
Section 6.02 Acceleration.................................................68
Section 6.03 Other Remedies...............................................69
Section 6.04 Waiver of Past Defaults......................................69
Section 6.05 Control by Majority..........................................69
Section 6.06 Limitation on Suits..........................................70
Section 6.07 Rights of Holders of Notes to Receive Payment................70
Section 6.08 Collection Suit by Trustee...................................70
Section 6.09 Trustee May File Proofs of Claim.............................70
Section 6.10 Priorities...................................................71
Section 6.11 Undertaking for Costs........................................71
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee............................................72
Section 7.02 Rights of Trustee............................................73
Section 7.03 Individual Rights of Trustee.................................73
Section 7.04 Trustee's Disclaimer.........................................73
Section 7.05 Notice of Defaults...........................................74
Section 7.06 Reports by Trustee to Holders of the Notes...................74
Section 7.07 Compensation and Indemnity...................................74
Section 7.08 Replacement of Trustee.......................................75
Section 7.09 Successor Trustee by Merger, etc.............................76
Section 7.10 Eligibility; Disqualification................................76
Section 7.11 Preferential Collection of Claims Against Company............76
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.....76
Section 8.02 Legal Defeasance and Discharge...............................76
Section 8.03 Covenant Defeasance..........................................77
Section 8.04 Conditions to Legal or Covenant Defeasance...................77
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Section 8.05 Deposited Money and Government Securities to be Held in
Trust; Other Miscellaneous Provisions......................78
Section 8.06 Repayment to Company.........................................79
Section 8.07 Reinstatement................................................79
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes..........................80
Section 9.02 With Consent of Holders of Notes.............................80
Section 9.03 Compliance with Trust Indenture Act..........................82
Section 9.04 Revocation and Effect of Consents............................82
Section 9.05 Notation on or Exchange of Notes.............................82
Section 9.06 Trustee to Sign Amendments, etc..............................82
ARTICLE 10
NOTE GUARANTEES
Section 10.01 Guarantee....................................................83
Section 10.02 Limitation on Guarantor Liability............................84
Section 10.03 Execution and Delivery of Note Guarantee.....................84
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms...........84
Section 10.05 Releases.....................................................85
ARTICLE 11
satisfaction and discharge
Section 11.01 Satisfaction and Discharge...................................85
Section 11.02 Application of Trust Money...................................86
ARTICLE 12
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls.................................87
Section 12.02 Notices......................................................87
Section 12.03 Communication by Holders of Notes with Other Holders
of Notes...................................................88
Section 12.04 Certificate and Opinion as to Conditions Precedent...........88
Section 12.05 Statements Required in Certificate or Opinion................88
Section 12.06 Rules by Trustee and Agents..................................89
Section 12.07 No Personal Liability of Directors, Officers, Employees
and Stockholders...........................................89
Section 12.08 Governing Law................................................89
Section 12.09 No Adverse Interpretation of Other Agreements................89
Section 12.10 Successors...................................................89
Section 12.11 Severability.................................................89
Section 12.12 Counterpart Originals........................................89
Section 12.13 Table of Contents, Headings, etc.............................90
EXHIBITS
Exhibit A1 FORM OF NOTE
Exhibit A2 FORM OF REGULATION S TEMPORARY GLOBAL NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
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Exhibit D FORM OF CERTIFICATE OF ACQUIRING INSTITUTIONAL ACCREDITED
INVESTOR
Exhibit E FORM OF NOTATION OF GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
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INDENTURE dated as of January 18, 2005 among General Nutrition
Centers, Inc., a Delaware corporation (the "Company"), the Guarantors (as
defined) and U.S. Bank National Association, as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for the
benefit of each other and for the equal and ratable benefit of the Holders (as
defined) of the 8-5/8% Senior Notes due 2011 (the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01 Definitions.
"144A Global Note" means a Global Note substantially in the form of
Exhibit A1 hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of, the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold in reliance on Rule 144A.
"Acquisition" means the acquisition of General Nutrition Companies,
Inc. pursuant to the Acquisition Agreement.
"Acquisition Agreement" means the Purchase Agreement, dated October 16,
2003, among Royal Numico N.V., Numico USA, Inc. and Apollo GNC Holding, Inc., as
in effect on December 5, 2003.
"Additional Assets" means
(l) any property or assets (other than Indebtedness and
Capital Stock) to be used by the Company or a Restricted Subsidiary
in a Related Business;
(2) the Capital Stock of a Person that becomes a Restricted
Subsidiary as a result of the acquisition of such Capital Stock by
the Company or another Restricted Subsidiary; provided that such
Restricted Subsidiary is primarily engaged in a Related Business;
(3) Capital Stock of any Person that at such time is a
Restricted Subsidiary, acquired from a third party; provided that
such Restricted Subsidiary is primarily engaged in a Related
Business; and
(4) Capital Stock or Indebtedness of any Person which is
primarily engaged in a Related Business; provided, however, for
purposes of Section 4.10 hereof, the aggregate amount of Net
Available Cash permitted to be invested pursuant to this clause (4)
shall not exceed at any one time outstanding 2.5% of Consolidated
Tangible Assets.
"Additional Notes" means additional Notes (other than the Initial
Notes) issued under this Indenture in accordance with Sections 2.02 and 2.13
hereof, and as permitted by Section 4.09 hereof, as part of the same series as
the Initial Notes.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing. No Person (other than the Company or any Subsidiary of the Company)
in whom a Receivables Subsidiary makes an Investment in connection with a
Qualified Receivables Transaction will be deemed to be an Affiliate of the
Company or any of its Subsidiaries solely by reason of such Investment.
"Agent" means any Registrar, co-registrar, Paying Agent or additional
paying agent.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.
"Apollo" means Apollo Management V, L.P. and its Affiliates or any
entity controlled thereby or any of the partners thereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition of shares of Capital Stock of a Restricted Subsidiary, other than
directors' qualifying shares, property or other assets, each referred to for
the purposes of this definition as a "disposition," by the Company or any of
its Restricted Subsidiaries, including any disposition by means of a merger,
consolidation or similar transaction, other than:
(1) a disposition by a Restricted Subsidiary to the Company
or by the Company or a Restricted Subsidiary to a Restricted
Subsidiary;
(2) a disposition of inventory, equipment, obsolete assets
or surplus personal property in the ordinary course of business;
(3) the sale of Cash Equivalents in the ordinary course of
business;
(4) a transaction or a series of related transactions in
which the fair market value of the assets disposed of, in the
aggregate, does not exceed $2 million;
(5) the sale or discount, with or without recourse, and on
commercially reasonable terms, of accounts receivable or notes
receivable arising in the ordinary course of business, or the
conversion or exchange of accounts receivable for notes receivable;
(6) the licensing of intellectual property in the ordinary
course of business;
(7) for purposes of Section 4.10 hereof only, a disposition
subject to the provisions of Section 4.07 hereof;
(8) a disposition of property or assets that is governed by
the provisions described under Section 5.01 hereof;
(9) the sale of franchisee accounts receivable and related
assets of the type specified in the definition of "Qualified
Receivables Transaction" to a Receivables Subsidiary for the fair
market value thereof, including cash in an amount at least equal to
75% of the book value thereof as determined in accordance with GAAP,
it being understood that, for the purposes of this clause (9), Notes
received in exchange for the transfer of franchisee accounts
receivable and related assets will be deemed cash if the Receivables
Subsidiary or other payor is required to repay said Notes as soon as
practicable from available cash collections less amounts required to
be established as reserves pursuant to contractual agreements with
2
entities that are not Affiliates of the Company entered into as part
of a Qualified Receivables Transaction;
(10) the transfer of franchise accounts receivable and
related assets of the type specified in the definition of "Qualified
Receivables Transaction" (or a fractional undivided interest therein)
by a Receivables Subsidiary in a Qualified Receivables Transaction;
(11) any surrender or waiver of contract rights or the
settlement release or surrender of contract, tort or other litigation
claims in the ordinary course of business;
(12) the granting of Liens (and foreclosure thereon) not
prohibited by this Indenture;
(13) the closure and disposition of retail stores or
distribution centers and any sales of a store owned by the Company to
a franchisee, in each case in the ordinary course of business; and
(14) any sublease of real property by the Company or any
Restricted Subsidiary to a franchisee in the ordinary course of
business.
"Average Life" means, as of the date of determination, with respect
to any Indebtedness or Preferred Stock, the quotient obtained by dividing:
(1) the sum of the products of the numbers of years from the
date of determination to the dates of each successive scheduled
principal payment of such Indebtedness or redemption or similar
payment with respect to such Indebtedness or Preferred Stock
multiplied by the amount of such payment by
(2) the sum of all such payments.
"Bank Indebtedness" means any and all amounts, whether outstanding on
December 5, 2003 or thereafter Incurred, payable under or in respect of the
Credit Facilities and all obligations under Specified Hedging Obligations (as
defined in the Credit Agreement), including, without limitation, principal,
premium, if any, interest, including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Company or
any Restricted Subsidiary whether or not a claim for post-filing interest is
allowed in such proceedings, penalties, fees, charges, expenses,
indemnifications, damages, reimbursement obligations, Guarantees, other
monetary obligations of any nature and all other amounts payable thereunder or
in respect thereof.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Board of Directors" means the board of directors of the Company or
any committee thereof duly authorized to act on behalf of such board.
"Borrowing Base" means, as of any date, an amount equal to:
(1) 75% of the face amount of all accounts receivable owned
by the Company and its Restricted Subsidiaries as of the end of the
most recent fiscal quarter preceding such date that were not more
than 60 days past due; provided, however, that any franchise accounts
receivable owned by a Receivables Subsidiary, or that the Company or
any of its Subsidiaries has agreed to transfer to a Receivables
Subsidiary, shall be excluded for purposes of determining such
amount; plus
3
(2) 50% of the book value of all inventory, net of reserves,
owned by the Company and its Restricted Subsidiaries as of the end of
the most recent fiscal quarter preceding such date.
"Broker-Dealer" has the meaning set forth in the Registration Rights
Agreement.
"Business Day" means a day other than a Saturday, Sunday or other day
on which commercial banking institutions are authorized or required by law to
close in New York City.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of
or interests in, however designated, equity of such Person, including any
Preferred Stock, but excluding any debt securities convertible into such
equity.
"Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under
such lease.
"Cash Equivalents" means any of the following:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or
instrumentality of the United States government (provided that the
full faith and credit of the United States is pledged in support of
those securities) having maturities of not more than one year from
the date of acquisition;
(3) certificates of deposit and eurodollar time deposits
with maturities of one year or less from the date of acquisition,
bankers' acceptances with maturities not exceeding one year and
overnight bank deposits, in each case, with any lender party to the
Credit Agreement or with any domestic commercial bank having capital
and surplus in excess of $500.0 million and a Thomson Bank Watch
Rating of "B" or better;
(4) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in
clauses (2) and (3) above entered into with any financial institution
meeting the qualifications specified in clause (3) above;
(5) commercial paper having one of the two highest ratings
obtainable from Moody's or S&P and, in each case, maturing within one
year after the date of acquisition; and
(6) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1)
through (5) of this definition.
"Change of Control" means:
(1) any event occurs the result of which is that any
"Person," as such term is used in Sections 13(d) and 14(d) of the
Exchange Act, other than any Permitted Holder or its Related Parties,
becomes the beneficial owner, as defined in Rules 13d-3 and 13d-5
under the Exchange Act (except that a Person shall be deemed to have
"beneficial ownership" of all shares that any such Person has the
right to acquire within one year) directly or indirectly, of more
than 50% of the Voting Stock of the Company or a Successor Company,
as defined below, including, without limitation, through a merger or
4
consolidation or purchase of Voting Stock of the Company; provided
that the Permitted Holders or their Related Parties do not have the
right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the Board of Directors; provided
further that the transfer of 100% of the Voting Stock of the Company
to a Person that has an ownership structure identical to that of the
Company prior to such transfer, such that the Company becomes a
Wholly Owned Subsidiary of such Person, shall not be treated as a
Change of Control for purposes of this Indenture;
(2) after an Equity Offering that is an initial public
offering of Capital Stock of the Company, during any period of two
consecutive years, individuals who at the beginning of such period
constituted the Board of Directors, together with any new directors
whose election by such Board of Directors or whose nomination for
election by the stockholders of the Company was approved by a vote of
a majority of the directors of the Company 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
then in office;
(3) the sale, lease, transfer, conveyance or other
disposition, in one or a series of related transactions other than a
merger or consolidation, of all or substantially all of the assets of
the Company and its Restricted Subsidiaries taken as a whole to any
Person or group of related Persons other than a Permitted Holder or a
Related Party of a Permitted Holder; or
(4) the adoption of a plan relating to the liquidation or
dissolution of the Company.
"Clearstream" means Clearstream Banking, S.A.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means General Nutrition Centers, Inc., and any and all
successors thereto.
"Consolidated Coverage Ratio" as of any date of determination means the
ratio of
(1) the aggregate amount of EBITDA of the Company and its
Restricted Subsidiaries for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such
determination for which consolidated financial statements of the
Company are available, to
(2) Consolidated Interest Expense of the Company for such
four fiscal quarters; provided, however, that:
(a) if the Company or any Restricted Subsidiary:
(i) has Incurred any Indebtedness since the
beginning of such period that remains outstanding on
such date of determination or if the transaction giving
rise to the need to calculate the Consolidated Coverage
Ratio is an Incurrence of Indebtedness, EBITDA and
Consolidated Interest Expense for such period shall be
calculated after giving effect on a pro forma basis to
such Indebtedness as if such Indebtedness had been
Incurred on the first day of such period, except that
in making such computation, the amount of Indebtedness
under any revolving credit facility outstanding on the
date of such calculation shall be computed based on:
5
(A) the average daily balance of such
Indebtedness during such four fiscal quarters or
such shorter period for which such facility was
outstanding or
(B) if such facility was created after the
end of such four fiscal quarters, the average
daily balance of such Indebtedness during the
period from the date of creation of such facility
to the date of such calculation, and the discharge
of any other Indebtedness repaid, repurchased,
defeased or otherwise discharged with the proceeds
of such new Indebtedness as if such discharge had
occurred on the first day of such period, or
(ii) has repaid, repurchased, defeased or
otherwise discharged any Indebtedness since the
beginning of the period that is no longer outstanding
on such date of determination, or if the transaction
giving rise to the need to calculate the Consolidated
Coverage Ratio involves a discharge of Indebtedness, in
each case other than Indebtedness Incurred under any
revolving credit facility unless such Indebtedness has
been permanently repaid, EBITDA and Consolidated
Interest Expense for such period shall be calculated
after giving effect on a pro forma basis to such
discharge of such Indebtedness, including with the
proceeds of such new Indebtedness, as if such discharge
had occurred on the first day of such period;
(b) if since the beginning of such period the Company
or any Restricted Subsidiary has made any Asset Disposition
of any company or any business or any business segment, the
EBITDA for such period shall be reduced by an amount equal
to the EBITDA, if positive, directly attributable to the
company, business or business segment that are the subject
of such Asset Disposition for such period or increased by an
amount equal to the EBITDA, if negative, directly
attributable thereto for such period and Consolidated
Interest Expense for such period shall be reduced by an
amount equal to the Consolidated Interest Expense directly
attributable to any Indebtedness of the Company or any
Restricted Subsidiary repaid, repurchased, defeased or
otherwise discharged with respect to the Company and its
continuing Restricted Subsidiaries in connection with such
Asset Disposition for such period, and, if the Capital Stock
of any Restricted Subsidiary is sold, the Consolidated
Interest Expense for such period directly attributable to
the Indebtedness of such Restricted Subsidiary to the extent
the Company and its continuing Restricted Subsidiaries are
no longer liable for such Indebtedness after such sale;
(c) if since the beginning of such period the Company
or any Restricted Subsidiary, by merger or otherwise, has
made an Investment in any Person that thereby becomes a
Restricted Subsidiary, or otherwise acquired any company or
any business or any group of assets, including any such
acquisition of assets occurring in connection with a
transaction causing a calculation to be made hereunder,
EBITDA and Consolidated Interest Expense for such period
shall be calculated after giving pro forma effect thereto,
including the Incurrence of any Indebtedness and including
the pro forma expenses and cost reductions calculated on a
basis consistent with Regulation S-X of the Securities Act,
as if such Investment or acquisition occurred on the first
day of such period; and
6
(d) if since the beginning of such period any Person
that subsequently became a Restricted Subsidiary or was
merged with or into the Company or any Restricted Subsidiary
since the beginning of such period, has made any Asset
Disposition or any Investment or acquisition of assets that
would have required an adjustment pursuant to clause (b) or
(c) above if made by the Company or a Restricted Subsidiary
during such period, EBITDA and Consolidated Interest Expense
for such period shall be calculated after giving pro forma
effect thereto, including the Incurrence of any Indebtedness
and including the pro forma expenses and cost reductions
calculated on a basis consistent with Regulation S-X of the
Securities Act, as if such Asset Disposition, Investment or
acquisition of assets occurred on the first day of such
period.
For purposes of this definition, whenever pro forma effect is to be
given to an Asset Disposition, Investment or acquisition of assets, or any
transaction governed by the provisions of Section 5.01 hereof or the amount of
income or earnings relating thereto and the amount of Consolidated Interest
Expense associated with any Indebtedness Incurred or repaid, repurchased,
defeased or otherwise discharged in connection therewith, the pro forma
calculations in respect thereof shall be as determined in good faith by a
responsible financial or accounting officer of the Company, based on
reasonable assumptions. If any Indebtedness bears a floating rate of interest
and is being given pro forma effect, the interest expense on such Indebtedness
shall be calculated at a fixed rate as if the rate in effect on the date of
determination had been the applicable rate for the entire period, taking into
account any Interest Rate Agreement applicable to such Indebtedness if such
Interest Rate Agreement has a remaining term as at the date of determination
in excess of 12 months. If any Indebtedness bears, at the option of the
Company or a Restricted Subsidiary, a fixed or floating rate of interest and
is being given pro forma effect, the interest expense on such Indebtedness
shall be computed by applying, at the option of the Company or such Restricted
Subsidiary, either a fixed or floating rate. If any Indebtedness which is
being given pro forma effect was Incurred under a revolving credit facility,
the interest expense on such Indebtedness shall be computed based upon the
average daily balance of such Indebtedness during the applicable period.
"Consolidated Interest Expense" means, as to any Person, for any
period, the total consolidated interest expense of such Person and its
Restricted Subsidiaries determined in accordance with GAAP, minus, to the
extent included in such interest expense, amortization or write-off of
financing costs plus, to the extent Incurred by such Person and its Restricted
Subsidiaries in such period but not included in such interest expense, without
duplication:
(1) interest expense attributable to Capitalized Lease
Obligations determined as if such lease were a capitalized lease, in
accordance with GAAP;
(2) amortization of debt discount;
(3) interest in respect of Indebtedness of any other Person
that has been Guaranteed by such Person or any Restricted Subsidiary,
but only to the extent that such interest is actually paid by such
Person or any Restricted Subsidiary;
(4) non-cash interest expense;
(5) net costs associated with Hedging Obligations;
(6) the product of:
7
(a) mandatory Preferred Stock cash dividends in respect
of all Preferred Stock of Restricted Subsidiaries of such
Person and Disqualified Stock of such Person held by Persons
other than such Person or a Restricted Subsidiary, multiplied
by
(b) a fraction, the numerator of which is one and the
denominator of which is one minus the then current combined
federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, determined on a
consolidated basis in accordance with GAAP; and
(7) the cash contributions to any employee stock ownership
plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest to any Person, other than the
referent Person or any Subsidiary thereof, in connection with
Indebtedness Incurred by such plan or trust; provided, however, that
as to the Company, there shall be excluded therefrom any such
interest expense of any Unrestricted Subsidiary to the extent the
related Indebtedness is not Guaranteed or paid by the Company or any
Restricted Subsidiary.
For purposes of the foregoing, gross interest expense shall be
determined after giving effect to any net payments made or received by such
Person and its Subsidiaries with respect to Interest Rate Agreements.
"Consolidated Net Income" means, as to any Person, for any period,
the consolidated net income (loss) of such Person and its Subsidiaries before
preferred stock dividends, determined in accordance with GAAP; provided,
however, that there shall not be included in such Consolidated Net Income:
(1) any net income (loss) of any Person if such Person is
not (as to the Company) a Restricted Subsidiary and, as to any other
Person, an unconsolidated Person, except that:
(a) the referent Person's equity in the net income of
any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash
actually distributed by such Person during such period to
the referent Person or a Subsidiary as a dividend or other
distribution, subject, in the case of a dividend or other
distribution to a Subsidiary, to the limitations contained
in clause (3) below, and
(b) the net loss of such Person shall be included to the
extent of the aggregate Investment of the referent Person or
any of its Restricted Subsidiaries in such Person;
(2) any net income (loss) of any Restricted Subsidiary, as
to the Company, or of any Subsidiary, as to any other Person, if in
either case such Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of
distributions by such Subsidiary, directly or indirectly, to the
Company, except that:
(a) such Person's equity in the net income of any
such Subsidiary for such period shall be included in
Consolidated Net Income up to the aggregate amount of cash
that could have been distributed by such Subsidiary during
such period to such Person or another Subsidiary as a
dividend, subject, in the case of a dividend that could have
been made to another Restricted Subsidiary, to the
limitation contained in this clause, and
(b) the net loss of such Subsidiary shall be included
in determining Consolidated Net Income;
8
(3) any extraordinary gain or loss (together with any
provision for taxes related thereto);
(4) the cumulative effect of a change in accounting
principles;
(5) any reduction to the Consolidated Net Income of any
Person caused by the amount, if any, of (a) non-cash charges relating
to the exercise of options and (b) non-cash losses (or minus non-cash
gains) from foreign currency translation;
(6) any decrease in net income caused by the increase in the
book value of assets as a result of the Acquisition as reflected on
the Company's balance sheet solely as a result of the application of
SFAS No. 141;
(7) any gain (or loss), together with any related provision
for taxes on such gain (or loss), realized in connection with any
asset sale (other than in the ordinary course of business);
(8) costs incurred prior to the date of this Indenture
related to the closing of stores in connection with the Acquisition;
and
(9) costs incurred by the Company relating to an election
made under Section 338(h)(10) of the Code (and any corresponding
election under state, local, and foreign income tax laws), as
provided in the Acquisition Agreement, in an amount not to exceed $10
million.
"Consolidated Tangible Assets" means, as of any date of
determination, the total assets, less goodwill and other intangibles, other
than patents, trademarks, copyrights, licenses and other intellectual
property, shown on the balance sheet of the Company and its Restricted
Subsidiaries as of the most recent date for which such a balance sheet is
available, determined on a consolidated basis in accordance with GAAP less all
write-ups, other than write-ups in connection with acquisitions, subsequent to
the date of this Indenture in the book value of any asset, except any such
intangible assets, owned by the Company or any of its Restricted Subsidiaries.
"Corporate Trust Office of the Trustee" will be at the address of the
Trustee specified in Section 12.02 hereof or such other address as to which
the Trustee may give notice to the Company.
"Credit Agreement" means the credit agreement dated as of December 5,
2003, among the Company, the Parent, the banks and other financial
institutions party thereto from time to time, Xxxxxx Commercial Paper Inc., as
administrative agent, JPMorgan Chase Bank, as syndication agent, and the other
parties thereto, as such agreement may be assumed by any successor in
interest, including any Loan Documents, as defined therein, any notes and
letters of credit issued pursuant thereto and any guarantee and collateral
agreement, intellectual property security agreement, mortgages, letter of
credit applications and other security agreements and collateral documents,
and other instruments and documents, executed and delivered pursuant to or in
connection with any of the foregoing, in each case as the same may be amended
(including pursuant to Amendment 1 thereto dated as of December 14, 2004),
supplemented, waived or otherwise modified from time to time, or refunded,
refinanced, restructured, replaced, renewed, repaid, increased or extended
from time to time (whether in whole or in part, whether with the Company, or
any subsidiary of the Company as borrower, whether with the original agent and
lenders or other agents and lenders or otherwise, and whether provided under
the original Credit Agreement or otherwise).
"Credit Facility" means one or more agreements (including, without
limitation, the Credit Agreement) or commercial paper facilities, in each case
with banks or other institutional lenders providing for revolving credit
loans, term loans or letters of credit, in each case, as amended, restated,
9
modified, renewed, refunded, replaced or refinanced (including by means of
sales of debt securities to institutional investors) in whole or in part from
time to time.
"Currency Agreement" means in respect of a Person any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement, including derivative agreements or arrangements, as to which such
Person is a party or a beneficiary.
"Custodian" means the Trustee, as custodian with respect to the Notes
in global form, or any successor entity thereto.
"Default" means any event or condition that is, or after notice or
passage of time or both would be, an Event of Default.
"Definitive Note" means a certificated Note registered in the name of
the Holder thereof and issued in accordance with Section 2.06 hereof,
substantially in the form of Exhibit A1 hereto except that such Note shall not
bear the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof
as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to
the applicable provision of this Indenture.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock that by its terms, or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable, or upon the
happening of any event:
(1) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise;
(2) is convertible or exchangeable for Indebtedness or
Disqualified Stock; or
(3) is redeemable at the option of the holder thereof, in
whole or in part;
in the case of clauses (1), (2) and (3), on or prior to the 91st day
after the Stated Maturity of the Notes. Notwithstanding the preceding
sentence, any Capital Stock that would constitute Disqualified Stock solely
because the holders of the Capital Stock have the right to require the Company
to repurchase such Capital Stock upon the occurrence of a change of control or
asset sale will not constitute Disqualified Stock if the terms of such Capital
Stock provide that the Company may not repurchase or redeem any such Capital
Stock pursuant to such provisions unless such repurchase or redemption
complies with the provisions of Section 4.07 hereof.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
that was formed under the laws of the United States or any state of the United
States or the District of Columbia or that Guarantees or otherwise provides
direct credit support for any Indebtedness of the Company.
"EBITDA" means, as to any Person, for any period, the Consolidated
Net Income for such period, plus the following to the extent included in
calculating such Consolidated Net Income:
(1) income tax expense;
10
(2) Consolidated Interest Expense (including the
amortization of any debt issuance costs to the extent such costs are
included in the calculation of Consolidated Interest Expense);
(3) depreciation expense;
(4) amortization expense (including the amortization of any
debt issuance costs to the extent such costs are included in the
calculation of Consolidated Interest Expense);
(5) other non-cash charges or non-cash losses; and
(6) any fees or expenses paid prior to the date of this
Indenture in connection with the Acquisition.
"Equity Offering" means any issuance or sale of Capital Stock (other
than Disqualified Stock and other than to the Company or any of its
Subsidiaries), or a contribution to the equity capital (other than by a
Subsidiary of the Company), of the Company, in each case, that results in net
proceeds to the Company of at least $100 million.
"Euroclear" means Euroclear Bank, S.A./N.V., as operator of the
Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the Notes issued in the Exchange Offer
pursuant to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Foreign Subsidiary" means any Restricted Subsidiary of the Company
that is not a Domestic Subsidiary.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the date of this Indenture, for purposes of
the definitions of the terms "Consolidated Coverage Ratio," "Consolidated
Interest Expense," "Consolidated Net Income" and "EBITDA," all defined terms
in this Indenture to the extent used in or relating to any of the foregoing
definitions, and all ratios and computations based on any of the foregoing
definitions, and as in effect from time to time, for all other purposes of
this Indenture, including those 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. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
"Global Note Legend" means the legend set forth in Section 2.06(g)(2)
hereof, which is required to be placed on all Global Notes issued under this
Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes deposited with or on
behalf of and registered in the name of the Depository or its nominee,
substantially in the form of Exhibit A1 hereto and that bears the Global Note
Legend and that has the "Schedule of Exchanges of Interests in the Global
11
Note" attached thereto, issued in accordance with Section 2.01, 2.06(b)(3),
2.06(b)(4), 2.06(d)(2) or 2.06(f) hereof.
"Government Obligations" means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness, including any
such obligation, direct or indirect, contingent or otherwise, of such Person:
(1) to purchase or pay, or advance or supply funds for the
purchase or payment of, such Indebtedness or such other obligation of
such other Person, whether arising by virtue of partnership
arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise; or
(2) entered into for purposes of assuring in any other
manner the obligee of such Indebtedness or other obligation of the
payment thereof or to protect such obligee against loss in respect
thereof, in whole or in part; provided, however, that the term
"Guarantee" shall not include endorsements for collection or deposits
made in the ordinary course of business.
The term "Guarantee" used as a verb has a correlative meaning.
"Guarantor" means
(1) the Company's direct and indirect Domestic Subsidiaries
existing on the date of this Indenture; and
(2) any Domestic Subsidiary created or acquired by the
Company after the date of this Indenture, other than any Immaterial
Subsidiary.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a Global Note substantially in the form of
Exhibit A1 hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of the Notes sold to Institutional Accredited
Investors.
"Immaterial Subsidiary" means, as of any date, any Restricted
Subsidiary whose total assets, as of that date, are less than $2 million and
whose total revenues for the most recent 12-month period do not exceed $2
million; provided that a Restricted Subsidiary will not be considered to be an
Immaterial Subsidiary if it, directly or indirectly, guarantees or otherwise
provides direct credit support for any Indebtedness of the Company.
"Incur" means issue, assume, enter into any Guarantee of, incur or
otherwise become liable for; provided, however, that any Indebtedness or
Capital Stock of a Person existing at the time such Person becomes a
Subsidiary, whether by merger, consolidation, acquisition or otherwise, shall
be deemed to be Incurred by such Subsidiary at the time it becomes a
Subsidiary. Any Indebtedness issued at a discount, including Indebtedness on
which interest is payable through the issuance of additional Indebtedness,
12
shall be deemed Incurred at the time of original issuance of the Indebtedness
at the initial accreted amount thereof.
"Indebtedness" means, with respect to any Person on any date of
determination, without duplication:
(1) the principal of Indebtedness of such Person for
borrowed money if and to the extent it would appear as a liability
upon the consolidated balance sheet of such Person prepared in
accordance with GAAP;
(2) the principal of obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments if and to the
extent it would appear as a liability upon the consolidated balance
sheet of such Person prepared in accordance with GAAP;
(3) all reimbursement obligations of such Person, including
reimbursement obligations in respect of letters of credit or other
similar instruments, the amount of such obligations being equal at
any time to the aggregate then undrawn and unexpired amount of such
letters of credit or other instruments plus the aggregate amount of
drawings thereunder that have not then been reimbursed;
(4) all obligations of such Person to pay the deferred and
unpaid purchase price of property or services, except Trade Payables,
which purchase price is due more than one year after the date of
placing such property in final service or taking final delivery and
title thereto or the completion of such services if and to the extent
it would appear as a liability upon the consolidated balance sheet of
such Person prepared in accordance with GAAP;
(5) all Capitalized Lease Obligations of such Person;
(6) the redemption, repayment or other repurchase amount of
such Person with respect to any Disqualified Stock or, if such Person
is a Subsidiary of the Company, any Preferred Stock of such
Subsidiary, but excluding, in each case, any accrued dividends, the
amount of such obligation to be equal at any time to the maximum
fixed involuntary redemption, repayment or repurchase price for such
Capital Stock, or if such Capital Stock has no fixed price, to the
involuntary redemption, repayment or repurchase price therefor
calculated in accordance with the terms thereof as if then redeemed,
repaid or repurchased, and if such price is based upon or measured by
the fair market value of such Capital Stock, such fair market value
shall be as determined in good faith by the Board of Directors or the
board of directors of the issuer of such Capital Stock;
(7) all Indebtedness of other Persons secured by a Lien on
any asset of such Person, whether or not such Indebtedness is assumed
by such Person; provided, however, that the amount of Indebtedness of
such Person shall be the lesser of:
(a) the fair market value of such asset at such date of
determination; and
(b) the amount of such Indebtedness of such other
Persons;
(8) all Indebtedness of other Persons to the extent
Guaranteed by such Person; and
(9) to the extent not otherwise included in this definition,
net Hedging Obligations of such Person, such obligations to be equal
at any time to the termination value of such agreement or arrangement
13
giving rise to such Hedging Obligation that would be payable by such
Person at such time.
The amount of Indebtedness of any Person at any date shall be
determined as set forth above or otherwise provided in this Indenture, or
otherwise in accordance with GAAP.
"Indenture" means this Indenture, as amended or supplemented from
time to time.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Note through a Participant.
"Initial Notes" means the first $150,000,000 aggregate principal
amount of Notes issued under this Indenture on the date hereof.
"Initial Purchasers" means Xxxxxx Brothers Inc. and X.X. Xxxxxx
Securities Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, who are not also QIBs.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement, including derivative agreements or
arrangements, as to which such Person is party or a beneficiary; provided,
however, any such agreements entered into in connection with the Notes shall
not be included.
"Investment" in any Person by any other Person means any direct or
indirect advance, loan or other extension of credit (other than to customers,
suppliers, directors, officers or employees of any Person in the ordinary
course of business) or capital contribution to (by means of any transfer of
cash or other property to others or any payment for property or services for
the account or use of others), or any purchase or acquisition of Capital
Stock, Indebtedness or other similar instruments issued by, such Person. If
the Company or any Restricted Subsidiary of the Company sells or otherwise
disposes of any Capital Stock of any direct or indirect Restricted Subsidiary
of the Company such that, after giving effect to any such sale or disposition,
such entity is no longer a Subsidiary of the Company, the Company shall be
deemed to have made an Investment on the date of any such sale or disposition
equal to the fair market value of the Capital Stock of such Subsidiary not
sold or disposed of.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Notes for use by such
Holders in connection with the Exchange Offer.
"Leverage Ratio" means, on any date of determination, the ratio of:
(1) the aggregate amount of Indebtedness of the Company and
its Restricted Subsidiaries on a consolidated basis as of such date,
to
(2) the aggregate amount of EBITDA of the Company and its
Restricted Subsidiaries for the period of the most recent four
consecutive fiscal quarters ending prior to the date of such
determination for which consolidated financial statements of the
Company are available; provided, however, that:
14
(a) if since the beginning of such period the Company
or any Restricted Subsidiary has made any Asset Disposition of
any company or any business or any business segment, the
EBITDA for such period shall be reduced by an amount equal to
the EBITDA, if positive, directly attributable to the company,
business or business segment that are the subject of such
Asset Disposition for such period or increased by an amount
equal to the EBITDA, if negative, directly attributable
thereto for such period;
(b) if since the beginning of such period the Company
or any Restricted Subsidiary, by merger or otherwise, has made
an Investment in any Person that thereby becomes a Restricted
Subsidiary, or otherwise acquired any company or any business
or any business segment, including any such acquisition of
assets occurring in connection with a transaction causing a
calculation to be made hereunder, EBITDA for such period shall
be calculated after giving pro forma effect thereto, including
the Incurrence of any Indebtedness and including the pro forma
expenses and cost reductions calculated on a basis consistent
with Regulation S-X of the Securities Act, as if such
Investment or acquisition occurred on the first day of such
period; and
(c) if since the beginning of such period any Person
that subsequently became a Restricted Subsidiary or was merged
with or into the Company or any Restricted Subsidiary since
the beginning of such period, has made any Asset Disposition
or any Investment or acquisition of assets that would have
required an adjustment pursuant to clause (a) or (b) above if
made by the Company or a Restricted Subsidiary during such
period, EBITDA for such period shall be calculated after
giving pro forma effect thereto, including the Incurrence of
any Indebtedness and including the pro forma expenses and cost
reductions calculated on a basis consistent with Regulation
S-X of the Securities Act, as if such Asset Disposition,
Investment or acquisition of assets occurred on the first day
of such period.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien
or charge of any kind, including any conditional sale or other title retention
agreement or lease in the nature thereof.
"Liquidated Damages" means the liquidated damages then owing under
the Registration Rights Agreement.
"Moody's" means Xxxxx'x Investors Service, Inc., and its successors.
"Net Available Cash" from an Asset Disposition means cash payments
received, including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise, but only
as and when received, but excluding any other consideration received in the
form of assumption by the acquiring person of Indebtedness or other
obligations relating to the properties or assets that are the subject of such
Asset Disposition or received in any other noncash form, therefrom, in each
case net of:
(1) all legal, title and recording tax expenses, commissions
and other fees and expenses incurred, including, without limitation,
fees and expenses of legal counsel, accountants and financial advisors,
and all Federal, state, provincial, foreign and local taxes required to
be paid or accrued as a liability under GAAP, as a consequence of such
Asset Disposition;
(2) all payments made on any Indebtedness that is secured by
any assets subject to such Asset Disposition, in accordance with the
terms of any Lien upon such assets, or that must by its terms, or in
15
order to obtain a necessary consent to such Asset Disposition, or by
applicable law be repaid out of the proceeds from such Asset
Disposition;
(3) all distributions and other payments required to be made
to minority interest holders in Subsidiaries or joint ventures as a
result of such Asset Disposition or to any other Person, other than the
Company or any Restricted Subsidiary, owning a beneficial interest in
the assets disposed of in such Asset Disposition; and
(4) appropriate amounts to be provided by the seller as a
reserve, in accordance with GAAP, against any liabilities associated
with the assets disposed of in such Asset Disposition and retained by
the Company or any Restricted Subsidiary after such Asset Disposition.
"Net Cash Proceeds" means, with respect to any issuance or sale of
any securities of the Company or any Subsidiary by the Company or any
Subsidiary, or any capital contribution, the cash proceeds of such issuance,
sale or contribution net of attorneys' fees, accountants' fees, underwriters'
or placement agents' fees, discounts or commissions and brokerage, consultant
and other fees and expenses actually incurred in connection with such
issuance, sale or contribution and net of taxes paid or payable as a result
thereof.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any Restricted
Subsidiary;
(a) provides any Guarantee or credit support of any
kind, including any undertaking, Guarantee, indemnity,
agreement or instrument that would constitute Indebtedness;
or
(b) is directly or indirectly liable, as a guarantor or
otherwise; and
(2) no default with respect to which, including any rights
that the holders thereof may have to take enforcement action against
an Unrestricted Subsidiary, would permit, upon notice, lapse of time
or both, any holder of any other Indebtedness of the Company or any
Restricted Subsidiary to declare a default under such other
Indebtedness or cause the payment thereof to be accelerated or
payable prior to its stated maturity.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Guarantee" means, individually, any Guarantee of payment of the
notes by a Guarantor pursuant to the terms of this Indenture, and,
collectively, all such Guarantees. Each such Guarantee will be in the form
prescribed in this Indenture.
"Notes" has the meaning assigned to it in the preamble to this
Indenture. The Initial Notes and the Additional Notes (and, in each case, any
Exchange Notes issued in exchange therefore) shall be treated as a single
class for all purposes under this Indenture, and unless the context otherwise
requires, all references to the Notes shall include the Initial Notes and any
Additional Notes (and, in each case, any Exchange Notes issued in exchange
therefore).
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
16
"Offering Memorandum" means the Company's offering memorandum, dated
January 11, 2005, related to the issuance and sale of the Initial Notes.
"Officer" means the Chief Executive Officer, President, Chief
Financial Officer, any Vice President, Controller, Secretary or Treasurer of
the Company.
"Officer's Certificate" means a certificate signed by at least one
Officer and that meets the requirements of Section 12.05 hereof.
"Opinion of Counsel" means a written opinion from legal counsel
satisfactory to the Trustee and that meets the requirements of Section 12.05
hereof. The counsel may be an employee of or counsel to the Company or the
Trustee.
"Parent" means GNC Corporation and its successors and assigns.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear
and Clearstream).
"Permitted Holder" means Apollo.
"Permitted Investment" means:
(1) any Investment by the Company or any Restricted
Subsidiary in a Restricted Subsidiary, the Company or a Person that
will, upon the making of such Investment, become a Restricted
Subsidiary;
(2) any Investment by the Company or any Restricted
Subsidiary in another Person if as a result of such Investment such
other Person is merged or consolidated with or into, or transfers or
conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary;
(3) any Investment by the Company or any Restricted
Subsidiary in Cash Equivalents;
(4) any Investment by the Company or any Restricted
Subsidiary in receivables owing to the Company or any Restricted
Subsidiary, if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade
terms; provided, however, that such trade terms may include such
concessionary trade terms as the Company or any such Restricted
Subsidiary deems reasonable under the circumstances;
(5) any Investment by the Company or any Restricted
Subsidiary in securities or other Investments received as
consideration in sales or other dispositions of property or assets
made in compliance with the provisions of Section 4.10 hereof;
(6) any Investment by the Company or any Restricted
Subsidiary in securities or other Investments received in settlement
of debts created in the ordinary course of business and owing to the
Company or any Restricted Subsidiary, or as a result of foreclosure,
perfection or enforcement of any Lien, or in satisfaction of
judgments, including in connection with any bankruptcy proceeding or
other reorganization of another Person;
(7) Investments in existence or made pursuant to legally
binding written commitments in existence on the date of this
Indenture;
17
(8) any Investment by the Company or any Restricted
Subsidiary in Hedging Obligations, which obligations are Incurred in
compliance with the provisions of Section 4.09 hereof;
(9) any Investment by the Company or any Restricted
Subsidiary in pledges or deposits:
(a) with respect to leases or utilities provided to
third parties in the ordinary course of business; or
(b) otherwise described in the definition of
"Permitted Liens;"
(10) Investments in a Related Business in an amount not to
exceed $35 million (measured at the time each such Investment is made
without giving effect to subsequent changes in value) in the
aggregate at any time outstanding (after giving effect to any such
Investments that are returned to the Company or any Restricted
Subsidiary, including through redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary);
(11) loans by the Company or any Restricted Subsidiary to
franchisees in an aggregate principal amount not to exceed $75
million at any one time outstanding;
(12) the acquisition by a Receivables Subsidiary in
connection with a Qualified Receivables Transaction of Capital Stock
of a trust or other Person established by such Receivables Subsidiary
to effect such Qualified Receivables Transaction; and any other
Investment by the Company or a Restricted Subsidiary of the Company
in a Receivables Subsidiary or any Investment by a Receivables
Subsidiary in any other Person in connection with a Qualified
Receivables Transaction; provided that such other Investment is in
the form of a note or other instrument that the Receivables
Subsidiary or other Person is required to repay as soon as
practicable from available cash collections less amounts required to
be established as reserves pursuant to contractual agreements with
entities that are not Affiliates of the Company entered into as part
of a Qualified Receivables Transaction;
(13) any Investment in exchange for, or out of the net
proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company or an employee stock ownership plan or
similar trust) of Capital Stock of the Company (other than
Disqualified Stock); provided that the amount of any Net Cash
Proceeds that are utilized for any such Investment will be excluded
from clause 3(B) of Section 4.07(a) hereof; provided, however, that
the value of any non-cash net proceeds shall be as conclusively
determined by the Board of Directors in good faith, except that in
the event the value of any non-cash net proceeds shall be $20 million
or more, the value shall be as determined in writing by an
independent investment banking firm of nationally recognized
standing;
(14) any sublease of real property to a franchisee, any
advertising cooperative with franchisees and any trade credit
extended to franchisees, in each case in the ordinary course of
business;
(15) any Investments received in compromise or resolution of
(a) obligations of trade creditors or customers that were incurred in
the ordinary course of business of the Company or any Restricted
Subsidiary, including pursuant to any plan of reorganization or
similar arrangement upon the bankruptcy or insolvency of any trade
creditor or customer; or (b) litigation, arbitration or other
disputes with Persons who are not Affiliates; and
18
(16) any Investments representing amounts held for employees
of the Company and its Restricted Subsidiaries under the Company's
deferred compensation plan; provided that the amount of such
Investments (excluding income earned thereon) shall not exceed the
amount otherwise payable to such employees the payment of which was
deferred under such plan and any amounts matched by the Company under
such plan.
"Permitted Liens" means:
(1) Liens on properties or assets of the Company or any
Guarantor securing Indebtedness and other Obligations under Credit
Facilities that was incurred pursuant to either clause (1) or clause
(14) of the definition of Permitted Debt or securing Hedging
Obligations with respect thereto;
(2) Liens for taxes, assessments or other governmental
charges not yet delinquent or the nonpayment of which in the
aggregate would not be reasonably expected to have a material adverse
effect on the Company and its Restricted Subsidiaries, or that are
being contested in good faith and by appropriate proceedings if
adequate reserves with respect thereto are maintained on the books of
the Company or such Subsidiary, as the case may be, in accordance
with GAAP;
(3) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other like Liens arising in the
ordinary course of business in respect of obligations that are not
overdue for a period of more than 60 days or that are bonded or that
are being contested in good faith and by appropriate proceedings;
(4) pledges, deposits or Liens in connection with workers'
compensation, unemployment insurance and other social security
legislation and/or similar legislation or other insurance-related
obligations, including, without limitation, pledges or deposits
securing liability to insurance carriers under insurance or
self-insurance arrangements;
(5) pledges, deposits or Liens to secure the performance of
bids, tenders, trade, government or other contracts, other than for
borrowed money, obligations and deposits for or under or in respect
of utilities, leases, licenses, statutory obligations, surety,
judgment and appeal bonds, performance bonds and other obligations of
a like nature incurred in the ordinary course of business;
(6) easements, including reciprocal easement agreements,
rights-of-way, building, zoning and similar restrictions, utility
agreements, covenants, reservations, restrictions, encroachments,
changes, and other similar encumbrances or title defects incurred, or
leases or subleases granted to others, in the ordinary course of
business, which do not in the aggregate materially interfere with the
ordinary conduct of the business of the Company and its Subsidiaries,
taken as a whole;
(7) Liens existing on, or provided for under, written
arrangements existing on, the date of this Indenture, or, in the case
of any such Liens securing Indebtedness of the Company or any of its
Subsidiaries existing or arising under written arrangements existing
on the date of this Indenture, securing any Refinancing Indebtedness
(except for Refinancing Indebtedness that was incurred in exchange
for, or the net proceeds of which were used to refund, refinance or
replace, Indebtedness that was permitted to be incurred under Credit
Facilities pursuant to clause (1) or (14) of the definition of
Permitted Debt) in respect of such Indebtedness so long as the Lien
securing such Refinancing Indebtedness is limited to all or part of
the same property or assets, plus improvements, accessions, proceeds
19
or dividends or distributions in respect thereof, that secured, or
under such written arrangements could secure, the original
Indebtedness;
(8) Liens securing Hedging Obligations Incurred in
compliance with provisions of Section 4.09 hereof;
(9) Liens arising out of judgments, decrees, orders or
awards in respect of which the Company shall in good faith be
prosecuting an appeal or proceedings for review which appeal or
proceedings shall not have been finally terminated, or the period
within which such appeal or proceedings may be initiated shall not
have expired and Liens arising from final judgments only to the
extent, in an amount and for a period not resulting in an Event of
Default with respect thereto;
(10) Liens existing on property or assets of a Person at the
time such Person becomes a Subsidiary of the Company, or at the time
the Company or a Restricted Subsidiary acquires such property or
assets; provided, however, that such Liens are not created in
connection with, or in contemplation of, such other Person becoming
such a Subsidiary, or such acquisition of such property or assets,
and that such Liens are limited to all or part of the same property
or assets, plus improvements, accessions, proceeds or dividends or
distributions in respect thereof, that secured, or, under the written
arrangements under which such Liens arose, could secure, the
obligations to which such Liens relate;
(11) Liens on Capital Stock of an Unrestricted Subsidiary
that secure Indebtedness or other obligations of such Unrestricted
Subsidiary;
(12) Liens securing the Notes or the Note Guarantees;
(13) Liens on assets of the Company or a Receivables
Subsidiary incurred in connection with a Qualified Receivables
Transaction;
(14) Liens securing Refinancing Indebtedness (except for
Refinancing Indebtedness that was incurred in exchange for, or the
net proceeds of which were used to refund, refinance or replace,
Indebtedness that was permitted to be incurred under Credit
Facilities pursuant to clause (1) or (14) of the definition of
Permitted Debt) Incurred in respect of any Indebtedness secured by,
or securing any refinancing, refunding, extension, renewal or
replacement, in whole or in part, of any other obligation secured by,
any other Permitted Liens; provided that any such new Lien is limited
to all or part of the same property or assets, plus improvements,
accessions, proceeds or dividends or distributions in respect
thereof, that secured, or, under the written arrangements under which
the original Lien arose, could secure, the obligations to which such
Liens relate;
(15) survey exceptions, easements or reservations of, or
rights of others for, licenses, rights-of-way, sewers, electric
lines, telegraph and telephone lines and other similar purposes, or
zoning or other restrictions as to the use of real property that were
not incurred in connection with Indebtedness and that do not in the
aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such
Person;
(16) Liens to secure Indebtedness permitted by clause (7) of
paragraph (b) of Section 4.09 hereof; provided that (a) any such Lien
attaches to such assets concurrently with or within 180 days after
the acquisition, construction or capital improvement thereof, (b)
such Lien attaches solely to the assets so acquired, constructed or
20
improved in such transaction and (c) the principal amount of the
Indebtedness secured thereby does not exceed 100% of the cost of such
assets;
(17) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for sale of goods in the ordinary
course of business;
(18) licenses of intellectual property granted in the
ordinary course of business;
(19) Liens in favor of customs or revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods;
(20) Liens in favor the Company or any Restricted
Subsidiary; and
(21) Liens incurred with respect to Obligations that do not
exceed $25.0 million at any one time outstanding.
"Permitted Payments to Parent" means, without duplication as to
amounts:
(1) payments to the Parent to permit the Parent to pay
reasonable directors fees and expenses when due and reasonable
accounting, legal and administrative expenses of the Parent when due
in an aggregate amount not to exceed $250,000 per annum; and
(2) for so long as the Company is a member of a group filing
a consolidated, combined or other similar group tax return with the
Parent, payments to the Parent in respect of an allocable portion of
the tax liabilities of such group that is attributable to the Company
and its Subsidiaries ("Tax Payments"). The Tax Payments shall not
exceed the lesser of (i) the amount of the relevant tax (including
any penalties and interest) that the Company would owe if the Company
and its Subsidiaries were filing a separate tax return (or a separate
consolidated or combined return with its Subsidiaries that are
members of the consolidated or combined group), taking into account
any carryovers and carrybacks of tax attributes (such as net
operating losses) of the Company and such Subsidiaries from other
taxable years (as reduced by the use of such carryovers and
carrybacks by the group of which the Parent is a member) and (ii) the
amount of the relevant tax, taking into account any allowed tax
credits, that the Parent actually owes to the appropriate taxing
authority. Any Tax Payments received from the Company shall be paid
over to the appropriate taxing authority within 30 days of the
Parent's receipt of such Tax Payments or refunded to the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock" as applied to the Capital Stock of any corporation
means Capital Stock of any class or classes, however designated, that is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(1) hereof to be placed on all Notes issued under this Indenture except
where otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
21
"Qualified Receivables Transaction" means any transaction or series
of transactions entered into by the Company or any of its Restricted
Subsidiaries pursuant to which the Company or any of its Restricted
Subsidiaries sells, conveys or otherwise transfers to (1) a Receivables
Subsidiary (in the case of a transfer by the Company or any of its Restricted
Subsidiaries) and (2) any other Person (in the case of a transfer by a
Receivables Subsidiary), or grants a security interest in, any franchise
accounts receivable (whether now existing or arising in the future) of the
Company or any of its Restricted Subsidiaries, and any assets related thereto
including, without limitation, all collateral securing such franchise accounts
receivable, all contracts and all guarantees or other obligations in respect
of such franchise accounts receivable, proceeds of such franchise accounts
receivable and other assets that are customarily transferred or in respect of
which security interests are customarily granted in connection with asset
securitization transactions involving franchise accounts receivable.
"Receivables Subsidiary" means a Restricted Subsidiary that engages
in no activities other than in connection with the financing of franchise
accounts receivable and that is designated by the Board of Directors (as
provided below) as a Receivables Subsidiary:
(1) no portion of the Indebtedness or any other Obligations
(contingent or otherwise) of which:
(a) is guaranteed by the Company or any Restricted
Subsidiary (excluding guarantees of Obligations (other than
the principal of, and interest on, Indebtedness) pursuant to
representations, warranties, covenants and indemnities
entered into in the ordinary course of business in
connection with a Qualified Receivables Transaction);
(b) is recourse to or obligates the Company or any
Restricted Subsidiary in any way other than pursuant to
representations, warranties, covenants and indemnities
entered into in the ordinary course of business in
connection with a Qualified Receivables Transaction; or
(c) subjects any property or asset of the Company or
any Restricted Subsidiary (other than franchise accounts
receivable and related assets as provided in the definition
of "Qualified Receivables Transaction"), directly or
indirectly, contingently or otherwise, to the satisfaction
thereof, other than pursuant to representations, warranties,
covenants and indemnities entered into in the ordinary
course of business in connection with a Qualified
Receivables Transaction;
(2) with which neither the Company nor any Restricted
Subsidiary has any material contract, agreement, arrangement or
understanding other than on terms no less favorable to the Company or
such Restricted Subsidiary than those that might be obtained at the
time from Persons who are not Affiliates of the Company, other than
fees payable in the ordinary course of business in connection with
servicing franchise accounts receivable; and
(3) with which neither the Company nor any Restricted
Subsidiary has any obligation to maintain or preserve such
Subsidiary's financial condition or cause such Subsidiary to achieve
certain levels of operating results. Any such designation by the
Board of Directors will be evidenced to the Trustee by filing with
the Trustee a certified copy of the resolution of the Board of
Directors giving effect to such designation and an Officer's
Certificate certifying that such designation complied with the
foregoing conditions.
22
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refund, refinance, replace, renew, repay or extend, including pursuant to any
defeasance or discharge mechanism (collectively, "refinances," and
"refinanced" shall have a correlative meaning), any Indebtedness existing on
the date of this Indenture or Incurred in compliance with this Indenture,
including Indebtedness of the Company that refinances Indebtedness of any
Restricted Subsidiary, to the extent permitted in this Indenture, and
Indebtedness of any Restricted Subsidiary that refinances Indebtedness of
another Restricted Subsidiary, including Indebtedness that refinances
Refinancing Indebtedness; provided, however, that:
(1) the Refinancing Indebtedness has a Stated Maturity no
earlier than the Stated Maturity of the Indebtedness being
refinanced;
(2) the Refinancing Indebtedness has an Average Life at the
time such Refinancing Indebtedness is Incurred that is equal to or
greater than the Average Life of the Indebtedness being refinanced;
(3) if the Indebtedness being refunded, refinanced,
replaced, renewed, repaid, extended, defeased or discharged is
Subordinated Obligations, such Refinancing Indebtedness is
subordinated in right of payment to the Notes on terms at least as
favorable to the Holders of Notes as those contained in the
documentation governing the Indebtedness being refunded, refinanced,
replaced, renewed, repaid, extended, defeased or discharged;
(4) such Refinancing Indebtedness is Incurred in an
aggregate principal amount, or if issued with original issue
discount, an aggregate issue price, that is equal to or less than the
aggregate principal amount, or if issued with original issue
discount, the aggregate accreted value, then outstanding of the
Indebtedness being refinanced, plus fees, underwriting discounts,
premiums and other costs and expenses Incurred in connection with
such Refinancing Indebtedness; provided further, however, that
Refinancing Indebtedness shall not include:
(a) Indebtedness of a Restricted Subsidiary that
refinances Indebtedness of the Company; or
(b) Indebtedness of the Company or a Restricted
Subsidiary that refinances Indebtedness of an Unrestricted
Subsidiary; and
(5) in the case of Indebtedness of the Company or a
Guarantor, such Refinancing Indebtedness is Incurred by the Company,
a Guarantor or by the Subsidiary who is the obligor on the
Indebtedness being refinanced.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of January 18, 2005, among the Company, the Guarantors and
the Initial Purchasers, as such agreement may be amended, modified or
supplemented from time to time and, with respect to any Additional Notes, one
or more registration rights agreements among the Company and the other parties
thereto, as such agreement(s) may be amended, modified or supplemented from
time to time, relating to rights given by the Company to the purchasers of
Additional Notes to register such Additional Notes under the Securities Act.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means a Regulation S Temporary Global Note
or Regulation S Permanent Global Note, as appropriate.
23
"Regulation S Permanent Global Note" means a permanent Global Note in
the form of Exhibit A1 hereto bearing the Global Note Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee, issued in a denomination equal to the
outstanding principal amount of the Regulation S Temporary Global Note upon
expiration of the Restricted Period.
"Regulation S Temporary Global Note" means a temporary Global Note
in the form of Exhibit A2 hereto deposited with or on behalf of and registered
in the name of the Depositary or its nominee, issued in a denomination equal
to the outstanding principal amount of the Notes initially sold in reliance on
Rule 903 of Regulation S.
"Related Business" means those businesses in which the Company or any
of its Subsidiaries is engaged on the date of this Indenture or that are
reasonably related or incidental thereto.
"Related Party" means:
(1) any controlling equityholder, 80% (or more) owned
Subsidiary, or immediate family member (in the case of an individual)
of any Permitted Holder; or
(2) any trust, corporation, partnership, limited liability
company or other entity, the beneficiaries, stockholders, partners,
members, owners or Persons beneficially holding an 80% or more
controlling interest of which consist of any one or more Permitted
Holders and/or such other Persons referred to in the immediately
preceding clause (1).
"Representative" means the Trustee, agent or representative, if any,
for an issue of Indebtedness.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a Global Note bearing the Private
Placement Legend.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period
as defined in Regulation S.
"Restricted Subsidiary" means any Subsidiary of the Company other
than an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Subordinated Notes" means the notes issued pursuant to the
Senior Subordinated Notes Indenture.
24
"Senior Subordinated Notes Indenture" means the indenture dated as of
December 5, 2003 among the Company, the guarantors named therein and U.S. Bank
National Association, as trustee, with respect to the Company's 8 1/2% Senior
Subordinated Notes due 2010, as amended from time to time.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in the Registration Rights Agreement.
"Significant Subsidiary" means:
(1) any Subsidiary that would be a "significant subsidiary"
as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture; and
(2) any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary.
"S&P" means Standard & Poor's Ratings Service, a division of The
XxXxxx-Xxxx Companies, Inc., and its successors.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the payment of principal
of such security is due and payable, including pursuant to any mandatory
redemption provision, but excluding any provision providing for the repurchase
of such security at the option of the holder thereof upon the happening of any
contingency beyond the control of the issuer unless such contingency has
occurred.
"Subordinated Obligation" means any Indebtedness of the Company or
any Guarantor, whether outstanding on the date of this Indenture or thereafter
Incurred, which is expressly subordinate or junior in right of payment to the
Notes or the Note Guarantees pursuant to a written agreement.
"Subsidiary" means, with respect to any specified Person:
(1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital
Stock entitled (without regard to the occurrence of any contingency
and after giving effect to any voting agreement or stockholders'
agreement that effectively transfers voting power) to vote in the
election of directors, managers or trustees of the corporation,
association or other business entity is at the time owned or
controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of
such Person or (b) the only general partners of which are that Person
or one or more Subsidiaries of that Person (or any combination
thereof).
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of this Indenture.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of
business in connection with the acquisition of goods or services.
25
"Trustee" means U.S. Bank National Association until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"Trust Officer" means, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant secretary, assistant
treasurer, trust officer or any other officer of the Trustee who customarily
performs functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such person's knowledge of and familiarity with the
particular subject and who shall have direct responsibility for the
administration of this Indenture.
"Unrestricted Definitive Note" means a Definitive Note that does not
bear and is not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a Global Note that does not bear and
is not required to bear the Private Placement Legend.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of the Company that at the time of
determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below; and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors may designate any Subsidiary of the
Company, including any newly acquired or newly formed Subsidiary of
the Company, to be an Unrestricted Subsidiary unless at the time of
such designation such Subsidiary or any of its Subsidiaries owns any
Capital Stock or Indebtedness of, or owns or holds any Lien on any
property of, the Company or any other Subsidiary of the Company that
is not a Subsidiary of the Subsidiary to be so designated; provided,
however, that either:
(a) the Subsidiary to be so designated has total
consolidated assets of $100,000 or less; or
(b) if such Subsidiary has consolidated assets
greater than $100,000, then such designation would be
permitted under the provisions of Section 4.07 hereof.
The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary; provided, however, that
immediately after giving effect to such designation:
(a) the Company could Incur at least $1.00 of
additional Indebtedness under paragraph (a) of Section 4.09
hereof; and
(b) no Default or Event of Default shall have
occurred and be continuing.
Any such designation by the Board of Directors shall be evidenced to
the Trustee by promptly filing with the Trustee a copy of the resolution of
the Company's Board of Directors giving effect to such designation and an
Officer's Certificate certifying that such designation complied with the
foregoing provisions.
"U.S. Person" means a U.S. Person as defined in Rule 902(k)
promulgated under the Securities Act.
26
"Voting Stock" of an entity means all classes of Capital Stock of
such entity then outstanding and normally entitled to vote in the election of
directors or all interests in such entity with the ability to control the
management or actions of such entity.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the
Company all the Capital Stock of which, other than directors' qualifying
shares, is owned by the Company or another Wholly Owned Subsidiary.
Section 1.02 Other Definitions.
Defined in
Term Section
---- ----------
"Affiliate Transaction".................................. 4.11
"Asset Disposition Offer"................................ 3.09
"Authentication Order"................................... 2.02
"Change of Control Offer"................................ 4.15
"Change of Control Payment".............................. 4.15
"Change of Control Payment Date"......................... 4.15
"Covenant Defeasance".................................... 8.03
"DTC".................................................... 2.03
"Event of Default"....................................... 6.01
"Excess Proceeds"........................................ 4.10
"Fairness Opinion"....................................... 4.11
"incur".................................................. 4.09
"Initial Agreement"...................................... 4.08
"Legal Defeasance"....................................... 8.02
"Offer Amount"........................................... 3.09
"Offer Period"........................................... 3.09
"Paying Agent"........................................... 2.03
"Permitted Debt"......................................... 4.09
"Payment Blockage Notice"................................ 10.03
"Payment Default"........................................ 6.01
"Purchase Date".......................................... 3.09
"Redemption Date" ....................................... 3.07
"Refinancing Agreement".................................. 4.08
"Registrar".............................................. 2.03
"Remaining Excess Proceeds" ............................. 4.10
"Restricted Payments".................................... 4.07
"Successor Company"...................................... 5.01
Section 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
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:
27
"indenture securities" means the Notes;
"indenture security Holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes and the Note Guarantees means the Company and
the Guarantors, respectively, and any successor obligor upon the Notes and the
Note Guarantees, respectively.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the
TIA have the meanings so assigned to them.
Section 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular;
(5) "will" shall be interpreted to express a command;
(6) provisions apply to successive events and transactions;
and
(7) references to sections of or rules under the Securities
Act will be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC from time to time.
ARTICLE 2
THE NOTES
Section 2.01 Form and Dating.
(a) General. The Notes and the Trustee's certificate of authentication
will be substantially in the form of Exhibits A1 and A2 hereto. The Notes may
have notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note will be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof.
The terms and provisions contained in the Notes will constitute, and
are hereby expressly made, a part of this Indenture, and the Company, the
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Note conflicts with the express provisions
of this Indenture, the provisions of this Indenture shall govern and be
controlling.
(b) Global Notes. Notes issued in global form will be substantially in
the form of Exhibits A1 or A2 hereto (including the Global Note Legend thereon
and the "Schedule of Exchanges of Interests in the Global Note" attached
thereto). Notes issued in definitive form will be substantially in the form of
28
Exhibit A1 hereto (but without the Global Note Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Note" attached thereto). Each
Global Note will represent such of the outstanding Notes as will be specified
therein and each shall provide that it represents the aggregate principal amount
of outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions.
Each Global Note will be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, as custodian for the Depositary and
registered in the name of the Depositary or the nominee of the Depositary. Any
endorsement of a Global Note to reflect the amount of any increase or decrease
in the aggregate principal amount of outstanding Notes represented thereby will
be made by the Trustee or the Custodian, at the direction of the Trustee, in
accordance with instructions given by the Holder thereof as required by Section
2.06 hereof.
(c) Temporary Global Notes. Notes offered and sold in reliance on
Regulation S will be issued initially in the form of the Regulation S Temporary
Global Note, which will be deposited on behalf of the purchasers of the Notes
represented thereby with the Trustee, as custodian for the Depositary, and
registered in the name of the Depositary or the nominee of the Depositary for
the accounts of designated agents holding on behalf of Euroclear or Clearstream,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. The Restricted Period will be terminated upon the receipt by the
Trustee of any certificates identified by the Company or its counsel to be
required pursuant to Rule 903(b)(3)(ii)(B) under the Securities Act, which may
include certificates from Euroclear or Clearstream, as the case may be,
certifying that it has received certification of non-United States beneficial
ownership of 100% of the aggregate principal amount of the Regulation S
Temporary Global Note (except to the extent of any beneficial owners thereof who
acquired an interest therein during the Restricted Period pursuant to another
exemption from registration under the Securities Act and who will take delivery
of a beneficial ownership interest in a 144A Global Note or an IAI Global Note
bearing a Private Placement Legend, all as contemplated by Section 2.06(b)
hereof).
Following the termination of the Restricted Period, beneficial
interests in the Regulation S Temporary Global Note will be exchanged for
beneficial interests in the Regulation S Permanent Global Note pursuant to the
Applicable Procedures. Simultaneously with the authentication of the
Regulation S Permanent Global Note, the Trustee will cancel the Regulation S
Temporary Global Note. The aggregate principal amount of the Regulation S
Temporary Global Note and the Regulation S Permanent Global Note may from time
to time be increased or decreased by adjustments made on the records of the
Trustee and the Depositary or its nominee, as the case may be, in connection
with transfers of interest as hereinafter provided.
(1) Euroclear and Clearstream Procedures Applicable. The
provisions of the "Operating Procedures of the Euroclear System" and
"Terms and Conditions Governing Use of Euroclear" and the "General
Terms and Conditions of Clearstream Banking" and "Customer Handbook" of
Clearstream will be applicable to transfers of beneficial interests in
the Regulation S Temporary Global Note and the Regulation S Permanent
Global Note that are held by Participants through Euroclear or
Clearstream.
Section 2.02 Execution and Authentication.
At least one Officer must sign the Notes for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note will nevertheless be
valid.
29
A Note will not be valid until authenticated by the manual signature
of the Trustee. The signature will be conclusive evidence that the Note has
been authenticated under this Indenture.
The Trustee will, upon receipt of a written order of the Company
signed by one Officer (an "Authentication Order"), authenticate Notes for
original issue that may be validly issued under this Indenture, including any
Additional Notes. The Authentication Order should contain the amount of the
Notes to be authenticated, the name in which the Notes are to be registered,
where the Notes are to be delivered as well as a direction to the Trustee to
authenticate the Notes. The aggregate principal amount of Notes outstanding at
any time may not exceed the aggregate principal amount of Notes authorized for
issuance by the Company pursuant to one or more Authentication Orders, except
as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. An authenticating agent may authenticate Notes
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 Holders, the
Company or an Affiliate of the Company.
Section 2.03 Registrar and Paying Agent.
The Company will maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Notes may be presented for payment ("Paying Agent").
The Registrar will keep a register of the Notes and of their transfer and
exchange. The Company may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar and
the term "Paying Agent" includes any additional paying agent. The Company may
change any Paying Agent or Registrar without notice to any Holder. The Company
will notify the Trustee in writing of the name and address of any Agent not a
party to this Indenture. If the Company fails to appoint or maintain another
entity as Registrar or Paying Agent, the Trustee shall act as such. The
Company or any of its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company ("DTC")
to act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the Registrar
and Paying Agent and to act as Custodian with respect to the Global Notes.
Section 2.04 Paying Agent to Hold Money in Trust.
The Company will require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium or Liquidated Damages, if any, or interest on the Notes,
and will notify the Trustee of any default by the Company in making any such
payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) will have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it will segregate and hold in a separate
trust fund for the benefit of the Holders all money held by it as Paying
Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee will serve as Paying Agent for the Notes.
30
Section 2.05 Holder Lists.
The Trustee will preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Company will furnish to the Trustee at least seven
Business Days before 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 may reasonably require of the names and addresses of the Holders of
Notes and the Company shall otherwise comply with TIA ss. 312(a).
Section 2.06 Transfer and Exchange.
(a) Transfer and Exchange of Global Notes. A Global Note may not be
transferred except as a whole by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if:
(1) the Company delivers to the Trustee notice from the
Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under
the Exchange Act and, in either case, a successor Depositary is not
appointed by the Company within 120 days after the date of such notice
from the Depositary;
(2) the Company in its sole discretion determines that the
Global Notes (in whole but not in part) should be exchanged for
Definitive Notes and delivers a written notice to such effect to the
Trustee; provided that in no event shall the Regulation S Temporary
Global Note be exchanged by the Company for Definitive Notes prior to
(A) the expiration of the Restricted Period and (B) the receipt by the
Registrar of any certificates required pursuant to Rule
903(b)(3)(ii)(B) under the Securities Act; or
(3) upon request of the Trustee or the Holders of at least a
majority in aggregate principal amount of outstanding Notes, if there
has occurred and is continuing a Default or Event of Default with
respect to the Notes.
Upon the occurrence of any of the preceding events in (1), (2) or (3)
above, Definitive Notes shall be issued in such names as the Depositary shall
instruct the Trustee. Global Notes also may be exchanged or replaced, in whole
or in part, as provided in Sections 2.07 and 2.10 hereof. Definitive Notes
delivered in exchange for any Global Note or beneficial interests in Global
Notes will be registered in the names, and issued in any approved
denominations, requested by or on behalf of the Depositary (in accordance with
its customary procedures) and will bear the Private Placement Legend and the
Regulation S Temporary Legend unless those legends are not required by
applicable law.
Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for
another Note other than as provided in this Section 2.06(a), however,
beneficial interests in a Global Note may be transferred and exchanged as
provided in Section 2.06(b), (c) or (f) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global Notes.
The transfer and exchange of beneficial interests in the Global Notes will be
effected through the Depositary, in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in the Restricted
31
Global Notes will be subject to restrictions on transfer comparable to those set
forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in the Global Notes also will require compliance with
either subparagraph (1) or (2) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(1) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend;
provided, however, that prior to the expiration of the Restricted
Period, transfers of beneficial interests in the Regulation S Temporary
Global Note may not be made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an Initial Purchaser). Beneficial
interests in any Unrestricted Global Note may be transferred to Persons
who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall be
required to be delivered to the Registrar to effect the transfers
described in this Section 2.06(b)(1).
(2) All Other Transfers and Exchanges of Beneficial Interests
in Global Notes. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 2.06(b)(1) above,
the transferor of such beneficial interest must deliver to the
Registrar either:
(A) both:
(i) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged; and
(ii) instructions given in accordance with the
Applicable Procedures containing information regarding
the Participant account to be credited with such
increase; or
(B) both:
(i) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Note in an
amount equal to the beneficial interest to be transferred
or exchanged; and
(ii) instructions given by the Depositary to the
Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to
effect the transfer or exchange referred to in (1) above;
provided that in no event shall Definitive Notes be issued upon the transfer
or exchange of beneficial interests in the Regulation S Temporary Global Note
prior to (A) the expiration of the Restricted Period and (B) the receipt by
the Registrar of any certificates required pursuant to Rule 903 under the
Securities Act. Upon consummation of an Exchange Offer by the Company in
accordance with Section 2.06(f) hereof, the requirements of this Section
2.06(b)(2) shall be deemed to have been satisfied upon receipt by the
Registrar of the instructions contained in the Letter of Transmittal delivered
by the Holder of such beneficial interests in the Restricted Global Notes.
Upon satisfaction of all of the requirements for transfer or exchange of
32
beneficial interests in Global Notes contained in this Indenture and the Notes
or otherwise applicable under the Securities Act, the Trustee shall adjust the
principal amount of the relevant Global Note(s) pursuant to Section 2.06(h)
hereof.
(3) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Note if the transfer
complies with the requirements of Section 2.06(b)(2) above and the
Registrar receives the following:
(A) if the transferee will take delivery in the form of
a beneficial interest in the 144A Global Note, then the
transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of
a beneficial interest in the Regulation S Temporary Global
Note or the Regulation S Permanent Global Note, then the
transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications in item (2) thereof;
and
(C) if the transferee will take delivery in the form of
a beneficial interest in the IAI Global Note, then the
transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if
applicable.
(4) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in an Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may
be exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note if the exchange or transfer complies with
the requirements of Section 2.06(b)(2) above and:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the holder of the beneficial interest
to be transferred, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the
distribution of the Exchange Notes or (iii) a Person who is
an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a beneficial interest in an
Unrestricted Global Note, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
33
(ii) if the holder of such beneficial interest in
a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange
or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
subparagraph (B) or (D) above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in the form
of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(1) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial interest
in a Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the
form of a Restricted Definitive Note, then, upon receipt by the
Registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Restricted Definitive Note, a certificate
from such holder in the form of Exhibit C hereto, including
the certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to
a Non-U.S. Person in an offshore transaction in accordance
with Rule 903 or Rule 904, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements
of the Securities Act in accordance with Rule 144, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to
an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the
34
Securities Act other than those listed in subparagraphs (B)
through (D) above, a certificate to the effect set forth in
Exhibit B hereto, including the certifications, certificates
and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such beneficial interest is being transferred to
the Company or any of its Subsidiaries, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item
(3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof, and
the Company shall execute and the Trustee shall authenticate and deliver to
the Person designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.06(c) shall be
registered in such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall instruct the
Registrar through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.06(c)(1) shall bear the Private Placement Legend
and shall be subject to all restrictions on transfer contained therein.
(2) Beneficial Interests in Regulation S Temporary Global
Note to Definitive Notes. Notwithstanding Sections 2.06(c)(1)(A) and
(C) hereof, a beneficial interest in the Regulation S Temporary
Global Note may not be exchanged for a Definitive Note or transferred
to a Person who takes delivery thereof in the form of a Definitive
Note prior to (A) the expiration of the Restricted Period and (B) the
receipt by the Registrar of any certificates required pursuant to
Rule 903(b)(3)(ii)(B) under the Securities Act, except in the case of
a transfer pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 903 or Rule 904.
(3) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest in a
Restricted Global Note may exchange such beneficial interest for an
Unrestricted Definitive Note or may transfer such beneficial interest
to a Person who takes delivery thereof in the form of an Unrestricted
Definitive Note only if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the holder of such beneficial interest,
in the case of an exchange, or the transferee, in the case
of a transfer, certifies in the applicable Letter of
Transmittal that it is not (i) a Broker-Dealer, (ii) a
Person participating in the distribution of the Exchange
Notes or (iii) a Person who is an affiliate (as defined in
Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
35
(D) the Registrar receives the following:
(i) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for an Unrestricted Definitive
Note, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item
(1)(b) thereof; or
(ii) if the holder of such beneficial interest in
a Restricted Global Note proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of an Unrestricted Definitive Note,
a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange
or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(4) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial interest
in an Unrestricted Global Note proposes to exchange such beneficial
interest for a Definitive Note or to transfer such beneficial
interest to a Person who takes delivery thereof in the form of a
Definitive Note, then, upon satisfaction of the conditions set forth
in Section 2.06(b)(2) hereof, the Trustee will cause the aggregate
principal amount of the applicable Global Note to be reduced
accordingly pursuant to Section 2.06(h) hereof, and the Company will
execute and the Trustee will authenticate and deliver to the Person
designated in the instructions a Definitive Note in the appropriate
principal amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c)(4) will be
registered in such name or names and in such authorized denomination
or denominations as the holder of such beneficial interest requests
through instructions to the Registrar from or through the Depositary
and the Participant or Indirect Participant. The Trustee will deliver
such Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(4) will not bear the
Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(1) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive
Note proposes to exchange such Note for a beneficial interest in a
Restricted Global Note or to transfer such Restricted Definitive
Notes to a Person who takes delivery thereof in the form of a
beneficial interest in a Restricted Global Note, then, upon receipt
by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Note for a beneficial interest in
a Restricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications
in item (2)(b) thereof;
36
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Restricted Definitive Note is being
transferred to a Non-U.S. Person in an offshore transaction
in accordance with Rule 903 or Rule 904, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration requirements
of the Securities Act other than those listed in
subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required
by item (3) thereof, if applicable;
(F) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Note is being
transferred pursuant to an effective registration statement
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (3)(c) thereof,
the Trustee will cancel the Restricted Definitive Note,
increase or cause to be increased the aggregate principal
amount of, in the case of clause (A) above, the appropriate
Restricted Global Note, in the case of clause (B) above, the
144A Global Note, in the case of clause (C) above, the
Regulation S Global Note, and in all other cases, the IAI
Global Note.
(2) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note
may exchange such Note for a beneficial interest in an Unrestricted
Global Note or transfer such Restricted Definitive Note to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the Holder, in the case of an exchange,
or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the
distribution of the Exchange Notes or (iii) a Person who is
an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
37
(D) the Registrar receives the following:
(i) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(c) thereof; or
(ii) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who shall
take delivery thereof in the form of a beneficial
interest in the Unrestricted Global Note, a certificate
from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange
or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.06(d)(2), the Trustee will cancel the
Definitive Notes and increase or cause to be increased the aggregate
principal amount of the Unrestricted Global Note.
(3) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive
Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Definitive Notes to a
Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note at any time. Upon receipt of
a request for such an exchange or transfer, the Trustee will cancel
the applicable Unrestricted Definitive Note and increase or cause to
be increased the aggregate principal amount of one of the
Unrestricted Global Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (2)(B),
(2)(D) or (3) above at a time when an Unrestricted Global Note has
not yet been issued, the Company will issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee will authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of
Definitive Notes so transferred.
(e) Transfer and Exchange of Definitive Notes for Definitive Notes.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar will register the
transfer or exchange of Definitive Notes. Prior to such registration of
transfer or exchange, the requesting Holder must present or surrender to the
Registrar the Definitive Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by its attorney, duly authorized in writing. In addition, the
requesting Holder must provide any additional certifications, documents and
information, as applicable, required pursuant to the following provisions of
this Section 2.06(e).
(1) Restricted Definitive Notes to Restricted Definitive
Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in the
form of a Restricted Definitive Note if the Registrar receives the
following:
38
(A) if the transfer will be made pursuant to Rule 144A,
then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item
(1) thereof;
(B) if the transfer will be made pursuant to Rule 903
or Rule 904, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the
certifications in item (2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the
Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required
by item (3) thereof, if applicable.
(2) Restricted Definitive Notes to Unrestricted Definitive
Notes. Any Restricted Definitive Note may be exchanged by the Holder
thereof for an Unrestricted Definitive Note or transferred to a
Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to
the Exchange Offer in accordance with the Registration
Rights Agreement and the Holder, in the case of an exchange,
or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (i) a
Broker-Dealer, (ii) a Person participating in the
distribution of the Exchange Notes or (iii) a Person who is
an affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) any such transfer is effected by a Broker-Dealer
pursuant to the Exchange Offer Registration Statement in
accordance with the Registration Rights Agreement; or
(D) the Registrar receives the following:
(i) if the Holder of such Restricted Definitive
Notes proposes to exchange such Notes for an
Unrestricted Definitive Note, a certificate from such
Holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(ii) if the Holder of such Restricted Definitive
Notes proposes to transfer such Notes to a Person who
shall take delivery thereof in the form of an
Unrestricted Definitive Note, a certificate from such
Holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (D),
if the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Registrar to the effect that
such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the
Securities Act.
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(3) Unrestricted Definitive Notes to Unrestricted Definitive
Notes. A Holder of Unrestricted Definitive Notes may transfer such
Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder
thereof.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company will issue and,
upon receipt of an Authentication Order in accordance with Section 2.02
hereof, the Trustee will authenticate:
(1) one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes accepted for exchange in the
Exchange Offer by Persons that certify in the applicable Letters of
Transmittal that (A) they are not Broker-Dealers, (B) they are not
participating in a distribution of the Exchange Notes and (C) they
are not affiliates (as defined in Rule 144) of the Company; and
(2) Unrestricted Definitive Notes in an aggregate principal
amount equal to the principal amount of the Restricted Definitive
Notes accepted for exchange in the Exchange Offer by Persons that
certify in the applicable Letters of Transmittal that (A) they are
not Broker-Dealers, (B) they are not participating in a distribution
of the Exchange Notes and (C) they are not affiliates (as defined in
Rule 144) of the Company.
Concurrently with the issuance of such Notes, the Trustee will cause
the aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company will execute and the Trustee will
authenticate and deliver to the Persons designated by the Holders of
Definitive Notes so accepted Unrestricted Definitive Notes in the appropriate
principal amount.
(g) Legends. The following legends will appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(1) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Note and each Definitive Note (and all Notes issued
in exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:
"THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION
COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT, IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, (5) IN ACCORDANCE WITH ANOTHER EXEMPTION
40
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN
OPINION OF COUNSEL IF GENERAL NUTRITION CENTERS, INC. SO REQUESTS) OR (6)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND
(B) IN ACCORDANCE WITH ALL APPLICABLE BLUE SKY LAWS OF THE STATES OF THE
UNITED STATES."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(4),
(c)(3), (c)(4), (d)(2), (d)(3), (e)(2), (e)(3) or (f) of
this Section 2.06 (and all Notes issued in exchange therefor
or substitution thereof) will not bear the Private Placement
Legend.
(2) Global Note Legend. Each Global Note will bear a legend
in substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (4) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF GENERAL NUTRITION CENTERS, INC.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. 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 ITS 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 MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER
ENTITY AS MAY BE 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 INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN."
(3) Regulation S Temporary Global Note Legend. The
Regulation S Temporary Global Note will bear a Legend in
substantially the following form:
"THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE CASH PAYMENTS OF INTEREST HEREON. DURING THE PERIOD WHICH SUCH
41
HOLDER HOLDS THIS NOTE NOTHING IN THIS LEGEND SHALL BE DEEMED TO PREVENT
INTEREST FROM ACCRUING ON THIS NOTE."
(h) Cancellation and/or Adjustment of Global Notes. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note will be returned to
or retained and canceled by the Trustee in accordance with Section 2.11
hereof. At any time prior to such cancellation, if any beneficial interest in
a Global Note is exchanged for or transferred to a Person who will take
delivery thereof in the form of a beneficial interest in another Global Note
or for Definitive Notes, the principal amount of Notes represented by such
Global Note will be reduced accordingly and an endorsement will be made on
such Global Note by the Trustee or by the Depositary at the direction of the
Trustee to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note, such other Global Note
will be increased accordingly and an endorsement will be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(1) To permit registrations of transfers and exchanges, the
Company will execute and the Trustee will authenticate Global Notes
and Definitive Notes upon receipt of an Authentication Order in
accordance with Section 2.02 hereof or at the Registrar's request.
(2) No service charge will be made to a Holder of a
beneficial interest in a Global Note or to a Holder of a Definitive
Note for any registration of transfer or exchange, but the Company
may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other
than any such transfer taxes or similar governmental charge payable
upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.09,
4.10, 4.15 and 9.05 hereof).
(3) The Registrar will not be required to register the
transfer of or exchange of any Note selected for redemption in whole
or in part, except the unredeemed portion of any Note being redeemed
in part.
(4) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes will be the valid obligations of the Company, evidencing the
same Indebtedness, and entitled to the same benefits under this
Indenture, as the Global Notes or Definitive Notes surrendered upon
such registration of transfer or exchange.
(5) Neither the Registrar nor the Company will be required:
(A) to issue, to register the transfer of or to
exchange any Notes during a period beginning at the opening
of business 15 days before the day of any selection of Notes
for redemption under Section 3.02 hereof and ending at the
close of business on the day of selection;
(B) to register the transfer of or to exchange any Note
selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part; or
42
(C) to register the transfer of or to exchange a Note
between a record date and the next succeeding interest
payment date.
(6) Prior to due presentment for the registration of a
transfer of any Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of
principal of and interest on such Notes and for all other purposes,
and none of the Trustee, any Agent or the Company shall be affected
by notice to the contrary.
(7) The Trustee will authenticate Global Notes and
Definitive Notes in accordance with the provisions of Section 2.02
hereof.
(8) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
Section 2.07 Replacement Notes.
If any mutilated Note is surrendered to the Trustee or the Company
and the Trustee receives evidence (which evidence may be from the Trustee) to
its satisfaction of the destruction, loss or theft of any Note, the Company
will issue and the Trustee, upon receipt of an Authentication Order, will
authenticate a replacement Note if the Trustee's requirements are met. If
required by the Trustee or the Company, an affidavit of lost certificate
and/or an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the
Trustee, any Agent and any authenticating agent from any loss that any of them
may suffer if a Note is replaced. The Company may charge for its expenses in
replacing a Note, including reasonable fees and expenses of its counsel and of
the Trustee and its counsel.
Every replacement Note is an additional obligation of the Company and
will be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
Section 2.08 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by
the Trustee (including any Note represented by a Global Note) except for those
canceled by it or at its direction, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof, and those described in this Section
2.08 as not outstanding. Except as set forth in Section 2.09 hereof, a Note
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Note; however, Notes held by the Company or a Subsidiary of
the Company shall not be deemed to be outstanding for purposes of Section
3.07(a) hereof.
If a Note is replaced pursuant to Section 2.07 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a protected purchaser.
If the principal amount of any Note is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes will be deemed to be no longer outstanding and will cease to accrue
interest.
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Section 2.09 Treasury Notes.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by
the Company or any Guarantor, or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
the Company or any Guarantor, will be considered as though not outstanding,
except that for the purposes of determining whether the Trustee will be
protected in relying on any such direction, waiver or consent, only Notes that
the Trustee knows are so owned will be so disregarded.
Section 2.10 Temporary Notes.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
will authenticate temporary Notes. Temporary Notes will be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as may be reasonably acceptable
to the Trustee. Without unreasonable delay, the Company will prepare and the
Trustee will authenticate definitive Notes in exchange for temporary Notes.
Holders of temporary Notes will be entitled to all of the benefits of
this Indenture.
Section 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent will forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
The Trustee, or at the direction of the Trustee, the Registrar or the Paying
Agent, and no one else will cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and will destroy
canceled Notes (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Notes will be delivered
to the Company. The Company may not issue new Notes to replace Notes that it
has paid or that have been delivered to the Trustee for cancellation.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, it
will pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest payable on the defaulted interest, to the Persons who are
Holders on a subsequent special record date, in each case at the rate provided
in the Notes and in Section 4.01 hereof. The Company will notify the Trustee
in writing of the amount of defaulted interest proposed to be paid on each
Note and the date of the proposed payment. The Company will fix or cause to be
fixed each such special record date and payment date; provided that no such
special record date may be less than 10 days prior to the related payment date
for such defaulted interest. At least 15 days before the special record date,
the Company (or, upon the written request of the Company, the Trustee in the
name and at the expense of the Company) will mail or cause to be mailed to
Holders a notice that states the special record date, the related payment date
and the amount of such interest to be paid.
Section 2.13 Issuance of Additional Notes.
The Company will be entitled, upon delivery of an Officer's
Certificate, Opinion of Counsel and Authentication Order, subject to its
compliance with Section 4.09 hereof, to issue Additional Notes under this
Indenture which will have identical terms as the Initial Notes issued on the
date of this Indenture, other than with respect to the date of issuance and
issue price.
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With respect to any Additional Notes, the Company will set forth in a
resolution of its Board of Directors and an Officer's Certificate, a copy of
each of which shall be delivered to the Trustee, the following information:
(1) the aggregate principal amount of such Additional Notes
to be authenticated and delivered pursuant to this Indenture;
(2) the issue price, the issue date and the CUSIP number of
such Additional Notes; and
(3) whether such Additional Notes shall be transfer
restricted Notes and issued in the form of Initial Notes as set forth
in Section 2.02 of this Indenture or shall be issued in the form of
Exchange Notes.
ARTICLE 3
REDEMPTION AND PREPAYMENT
Section 3.01 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it must furnish to the Trustee,
at least 30 days (unless a shorter period is acceptable to the Trustee) but
not more than 60 days (unless a longer period is acceptable to the Trustee)
before a redemption date, an Officer's Certificate setting forth:
(1) the clause of this Indenture pursuant to which the
redemption shall occur;
(2) the redemption date;
(3) the principal amount of Notes to be redeemed; and
(4) the redemption price.
Section 3.02 Selection of Notes to Be Redeemed or Purchased.
If less than all of the Notes are to be redeemed or purchased in an
offer to purchase at any time, the Trustee will select Notes for redemption or
purchase on a pro rata basis, by lot or by such method as the Trustee shall
deem fair and appropriate.
In the event of partial redemption or purchase by lot, the particular
Notes to be redeemed or purchased will be selected, unless otherwise provided
herein, not less than 30 nor more than 90 days prior to the redemption or
purchase date by the Trustee from the outstanding Notes not previously called
for redemption or purchase.
The Trustee will promptly notify the Company in writing of the Notes
selected for redemption or purchase and, in the case of any Note selected for
partial redemption or purchase, the principal amount thereof to be redeemed or
purchased. Notes and portions of Notes selected will be in amounts of $1,000
or whole multiples of $1,000; except that if all of the Notes of a Holder are
to be redeemed or purchased, the entire outstanding amount of Notes held by
such Holder, even if not a multiple of $1,000, shall be redeemed or purchased.
Except as provided in the preceding sentence, provisions of this Indenture
that apply to Notes called for redemption or purchase also apply to portions
of Notes called for redemption or purchase.
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Section 3.03 Notice of Redemption.
Subject to the provisions of Section 3.09 hereof, at least 30 days
but not more than 90 days before a redemption date, the Company will mail or
cause to be mailed, by first class mail, a notice of redemption to each Holder
whose Notes are to be redeemed at its registered address, except that
redemption notices may be mailed more than 90 days prior to a redemption date
if the notice is issued in connection with a defeasance of the Notes or a
satisfaction and discharge of this Indenture pursuant to Articles 8 or 11
hereof.
The notice will identify the Notes to be redeemed and will state:
(1) the redemption date;
(2) the redemption price;
(3) if any Note is being redeemed in part, the portion of
the principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a Note or Notes in
principal amount equal to the unredeemed portion will be issued upon
cancellation of the original Note;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(6) that, unless the Company defaults in making such
redemption payment, interest on Notes called for redemption ceases to
accrue on and after the redemption date;
(7) the paragraph of the Notes and/or Section of this
Indenture pursuant to which the Notes called for redemption are being
redeemed; and
(8) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or
printed on the Notes.
At the Company's request, the Trustee will give the notice of
redemption in the Company's name and at its expense; provided, however, that
the Company has delivered to the Trustee, at least 45 days (unless a shorter
period is acceptable to the Trustee) prior to the redemption date, an
Officer's Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice as provided in the preceding
paragraph.
Section 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional. At any time prior to the mailing of a notice of redemption to the
Holders pursuant to Section 3.03 hereof, the Company may withdraw, revoke or
rescind any notice of redemption delivered to the Trustee without any
continuing obligation to redeem the Notes as contemplated by such notice of
redemption.
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Section 3.05 Deposit of Redemption or Purchase Price.
At or before 10:00 a.m. Eastern Time on the redemption or purchase
date, the Company will deposit with the Trustee or with the Paying Agent money
sufficient to pay the redemption or purchase price of and accrued and unpaid
interest and Liquidated Damages, if any, on all Notes to be redeemed or
purchased on that date. The Trustee or the Paying Agent will promptly return
to the Company any money deposited with the Trustee or the Paying Agent by the
Company in excess of the amounts necessary to pay the redemption or purchase
price of, and accrued and unpaid interest and Liquidated Damages, if any, on,
all Notes to be redeemed or purchased.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption or purchase date, interest will cease
to accrue on the Notes or the portions of Notes called for redemption or
purchase. If a Note is redeemed or purchased on or after an interest record
date but on or prior to the related interest payment date, then any accrued
and unpaid interest shall be paid to the Person in whose name such Note was
registered at the close of business on such record date. If any Note called
for redemption or purchase is not so paid upon surrender for redemption or
purchase because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the redemption
or purchase date until such principal is paid, and to the extent lawful on any
interest not paid on such unpaid principal, in each case at the rate provided
in the Notes and in Section 4.01 hereof.
Section 3.06 Notes Redeemed or Purchased in Part.
Upon surrender of a Note that is redeemed or purchased in part, the
Company will issue and, upon receipt of an Authentication Order, the Trustee
will authenticate for the Holder at the expense of the Company, a new Note
equal in principal amount to the unredeemed or unpurchased portion of the Note
surrendered.
Section 3.07 Optional Redemption.
(a) At any time prior to January 15, 2008, the Company may on any one
or more occasions redeem up to 35% of the aggregate principal amount of Notes
issued under this Indenture at a redemption price of 108.625% of the principal
amount thereof, plus accrued and unpaid interest and Liquidated Damages, if
any, to the redemption date, with the Net Cash Proceeds of one or more Equity
Offerings; provided that:
(1) at least 65% of the aggregate principal amount of Notes
originally issued under this Indenture (excluding Notes held by the
Company and its Subsidiaries) remains outstanding immediately after
the occurrence of such redemption; and
(2) the redemption occurs within 60 days after the date of
the closing of such Equity Offering.
(b) Except pursuant to the preceding paragraph, the Notes will not be
redeemable at the Company's option prior to January 15, 2008.
(c) On or after January 15, 2008 and prior to maturity, the Company
may, at its option, redeem all or a part of the Notes at any time and from
time to time upon not less than 30 nor more than 90 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth
below plus accrued and unpaid interest and Liquidated Damages, if any, on the
Notes redeemed to the applicable redemption date, if redeemed during the
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twelve-month period beginning on January 15 of the years indicated below,
subject to the rights of Holders on the relevant record date to receive
interest on the relevant interest payment date:
Year Percentage
---- ----------
2008................................................... 104.313%
2009................................................... 102.156%
2010 and thereafter.................................... 100.000%
Unless the Company defaults in the payment of the redemption price,
interest will cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(d) Any redemption pursuant to this Section 3.07 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.
Section 3.08 Mandatory Redemption.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
Section 3.09 Offer to Purchase by Application of Excess Proceeds.
In the event that, pursuant to Section 4.10 hereof, the Company is
required to commence an offer to all Holders to purchase Notes (an "Asset
Disposition Offer"), it will follow the procedures specified below.
The Asset Disposition Offer shall be made to all Holders and all
holders of other Indebtedness that is pari passu with the Notes containing
provisions similar to those set forth in this Indenture with respect to offers
to purchase or redeem at a purchase price of 100% of the principal amount
thereof plus accrued and unpaid interest to the Purchase Date and liquidated
damages, if any, with the proceeds of sales of assets. The Company will comply
with the requirements of Section 14(e) of the Exchange Act and any other
securities laws or regulations in connection with the repurchase of Notes
pursuant to this Section 3.09 and Section 4.10 hereof, in each case, to the
extent applicable. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 3.09 or Section 4.10
hereof, the Company will comply with the applicable securities laws and
regulations and will not be deemed to have breached its obligations under this
Section or Section 4.10 hereof as a results of such compliance. Payment for
any Notes so purchased will be made in the same manner as interest payments
are made.
If the date on which Notes are purchased pursuant to an Asset
Disposition Offer (the "Purchase Date") is on or after an interest record date
and on or before the related interest payment date, any accrued and unpaid
interest and Liquidated Damages, if any, will be paid to the Person in whose
name a Note is registered at the close of business on such record date, and no
additional interest will be payable to Holders who tender Notes pursuant to
the Asset Disposition Offer.
Upon the commencement of an Asset Disposition Offer, the Company will
send, by first class mail, a notice to the Trustee and each of the Holders,
with a copy to the Trustee. The notice will contain all instructions and
materials necessary to enable such Holders to tender Notes pursuant to the
Asset Disposition Offer. The notice, which will govern the terms of the Asset
Disposition Offer, will state:
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(1) that the Asset Disposition Offer is being made pursuant
to this Section 3.09 and Section 4.10 hereof and the length of time
the Asset Disposition Offer will remain open;
(2) the offer amount, which shall equal the amount of all
Excess Proceeds (the "Offer Amount"), the purchase price and the
Purchase Date;
(3) that any Note not tendered or accepted for payment will
continue to accrue interest and Liquidated Damages, if any;
(4) that, unless the Company defaults in making such
payment, any Note accepted for payment pursuant to the Asset
Disposition Offer will cease to accrue interest and Liquidated
Damages, if any, after the Purchase Date;
(5) that Holders electing to have a Note purchased pursuant
to an Asset Disposition Offer may elect to have Notes purchased in
integral multiples of $1,000 only;
(6) the instructions determined by the Company, consistent
with Section 4.10 and this Section 3.09, that a Holder must follow to
have its Notes purchased;
(7) that, if the aggregate principal amount of Notes and
other pari passu Indebtedness surrendered in connection with the
Asset Disposition Offer thereof exceeds the Offer Amount, the Company
will select the Notes and other pari passu Indebtedness to be
purchased on a pro rata basis based on the principal amount of Notes
and such other pari passu Indebtedness surrendered (with such
adjustments as may be deemed appropriate by the Company so that only
Notes in denominations of $1,000, or integral multiples thereof, will
be purchased); and
(8) that Holders whose Notes were purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered (or transferred by book-entry
transfer).
On or before the Purchase Date, the Company will, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof properly tendered and not withdrawn
pursuant to the Asset Disposition Offer, or if less than the Offer Amount has
been tendered, all Notes properly tendered and not withdrawn and will deliver
or cause to be delivered to the Trustee the Notes properly accepted together
with an Officer's Certificate stating that such Notes or portions thereof were
accepted for payment by the Company in accordance with the terms of this
Section 3.09. The Company, the Depositary or the Paying Agent, as the case may
be, will promptly mail or deliver to each tendering Holder an amount equal to
the purchase price of the Notes tendered by such Holder and accepted by the
Company for purchase, and the Company will promptly issue a new Note, and the
Trustee, upon written request from the Company, will authenticate and mail or
deliver (or cause to be transferred by book entry) such new Note to such
Holder, in a principal amount equal to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company will publicly announce the
results of the Asset Disposition Offer on or about the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.
49
ARTICLE 4
COVENANTS
Section 4.01 Payment of Notes.
The Company will pay or cause to be paid the principal of, premium,
if any, and interest and Liquidated Damages, if any, on, the Notes on the
dates and in the manner provided in the Notes. Principal, premium, if any, and
interest and Liquidated Damages, if any will be considered paid on the date
due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 11:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to
pay all principal, premium, if any, and interest then due. The Company will
pay all Liquidated Damages, if any, in the same manner on the dates and in the
amounts set forth in the Registration Rights Agreement.
The Company will pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal and premium, if
any, at the rate equal to the then applicable interest rate on the Notes to
the extent lawful; it will pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest
and Liquidated Damages (without regard to any applicable grace period) at the
same rate to the extent lawful.
Section 4.02 Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, The City of
New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may
be served. The Company will 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 fails to maintain any such required office or agency or fails
to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Notes 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 will in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York for such purposes. The Company will
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 hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with Section
2.03 hereof.
Section 4.03 Reports.
(a) Whether or not required by the rules and regulations of the SEC,
so long as any Notes are outstanding, the Company will furnish to the Holders
of Notes or cause the Trustee, at the Company's expense, to furnish to the
Holders of Notes, within the time periods specified in the SEC's rules and
regulations:
(1) all quarterly and annual reports that would be required
to be filed with the SEC on Forms 10-Q and 10-K if the Company were
required to file such reports and, with respect to the annual
50
information only, a report on the Company's consolidated financial
statements by the Company's certified independent accountants; and
(2) all current reports that would be required to be filed
with the SEC on Form 8-K if the Company were required to file such
reports.
All such reports will be prepared in all material respects in
accordance with all of the rules and regulations of the Exchange Act
applicable to such reports.
In addition, the Company will file a copy of each of the reports
referred to in clauses (1) and (2) above with the SEC for public availability
within the time periods specified in the rules and regulations applicable to
such reports (unless the SEC will not accept such a filing) and will make such
information available to securities analysts and prospective investors upon
request. The Company will at all times comply with TIA ss. 314(a).
If at any time the Company is no longer subject to the periodic
reporting requirements of the Exchange Act for any reason, the Company will
nevertheless continue filing the reports specified in the preceding paragraphs
with the SEC within the time periods specified above unless the SEC will not
accept such a filing. The Company will not take any action for the purpose of
causing the SEC not to accept any such filings. If, notwithstanding the
foregoing, the SEC will not accept the Company's filings for any reason, the
Company will post the reports referred to in the preceding paragraphs on its
website within the time periods that would apply if the Company were required
to file those reports with the SEC.
(b) For so long as any Notes remain outstanding, if at any time the Company
and the Guarantors are not required to file with the SEC the reports required
by paragraphs (a) and (b) of this Section 4.03, the Company and the Guarantors
will furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act.
Section 4.04 Compliance Certificate.
(a) The Company and each Guarantor (to the extent that such Guarantor
is so required under the TIA) shall deliver to the Trustee, within 120 days
after the end of each fiscal year, an Officer's Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officer with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in
the performance or observance of any of the terms, provisions and conditions
of this Indenture (or, if a Default or Event of Default has occurred,
describing all such Defaults or Events of Default of which he or she may have
knowledge and what action the Company is taking or proposes to take with
respect thereto).
(b) So long as any of the Notes are outstanding, the Company will
deliver to the Trustee, within 30 days after the occurrence of any Default or
Event of Default, an Officer's Certificate specifying such Default or Event of
Default, its status and what action the Company is taking or proposes to take
with respect thereto.
51
Section 4.05 Taxes.
The Company will pay, and will cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment would not have a material adverse
effect on the ability of the Company and the Guarantors to satisfy their
obligations under the Notes, the Guarantees and this Indenture.
Section 4.06 Stay, Extension and Usury Laws.
The Company and each of the Guarantors 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,
extension or usury law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Company and each of the Guarantors (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not, by resort to any such law, 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 has been
enacted.
Section 4.07 Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any Restricted
Subsidiaries to, take any of the following actions:
(i) declare or pay any dividend or make any other
payment or distribution on account of the Company's or
any of its Restricted Subsidiaries' Capital Stock
(including, without limitation, any payment in
connection with any merger or consolidation involving
the Company or any of its Restricted Subsidiaries) or
to the direct or indirect holders of the Company's or
any of its Restricted Subsidiaries' Capital Stock in
their capacity as such (other than dividends or
distributions payable in Capital Stock (other than
Disqualified Stock) of the Company or to the Company or
a Restricted Subsidiary and other than payments of
dividends on, and mandatory repurchases at Stated
Maturity of, Disqualified Stock outstanding on the date
of this Indenture or issued thereafter in compliance
with Section 4.09 hereof);
(ii) purchase, redeem, retire or otherwise acquire
for value (including, without limitation, in connection
with any merger or consolidation involving the Company)
any Capital Stock of the Company, of any direct or
indirect parent of the Company or of any Restricted
Subsidiary held by Persons other than the Company or
another Restricted Subsidiary;
(iii) purchase, repurchase, redeem, defease or
otherwise acquire or retire for value any Subordinated
Obligation before scheduled maturity, scheduled
repayment or scheduled sinking fund payment; provided
that this restriction does not apply to a purchase,
repurchase, redemption or other acquisition made in
anticipation of satisfying a sinking fund obligation,
principal installment or final maturity, in each case
due within one year of the date of such purchase,
repurchase, redemption or acquisition; or
52
(iv) make any Restricted Investment (all such
payments and other actions set forth in these clauses
(i) through (iv) above being collectively referred to
as "Restricted Payments"),
if at the time the Company or its Restricted Subsidiary makes a
Restricted Payment:
(1) a Default occurs and continues to occur or would result
therefrom;
(2) the Company could not Incur at least $1.00 of additional
Indebtedness under paragraph (a) of Section 4.09 hereof; or
(3) the aggregate amount of such Restricted Payment and all
other Restricted Payments declared or made after December 5, 2003
(excluding Restricted Payments permitted by clauses (1), (2), (3),
(5), and (6) of paragraph (b) of this Section 4.07) would exceed,
without duplication, the sum of:
(A) 50% of the Consolidated Net Income of the Company
accrued during the period, treated as one accounting period,
from the beginning of the first fiscal quarter commencing
after December 5, 2003 to the end of the most recent fiscal
quarter ending before the date of such Restricted Payment
for which consolidated financial statements of the Company
are available, or, if such Consolidated Net Income is a
deficit, then minus 100% of such deficit;
(B) 100% of the aggregate Net Cash Proceeds received by
the Company since December 5, 2003 as a contribution to its
common equity capital or from the issue or sale of Capital
Stock of the Company (other than Disqualified Stock) or from
the issue or sale of convertible or exchangeable
Disqualified Stock or convertible or exchangeable debt
securities of the Company that have been converted into or
exchanged for such Capital Stock (other than Capital Stock
(or Disqualified Stock or debt securities) sold to a
Restricted Subsidiary of the Company), less the amount of
any such Net Cash Proceeds that are utilized for an
Investment pursuant to clause (13) of the definition of
"Permitted Investments;"
(C) in the case of the disposition or repayment of any
Investment constituting a Restricted Investment, without
duplication of any amount deducted in calculating the amount
of Investments at any time outstanding included in the
amount of Restricted Payments, an amount equal to the lesser
of the return of capital or similar repayment with respect
to such Investment, or the initial amount of such
Investment, in either case, less the cost of the disposition
of such Investment;
(D) to the extent that any Unrestricted Subsidiary of
the Company designated as such after December 5, 2003 is
redesignated as a Restricted Subsidiary after December 5,
2003, the lesser of (i) the fair market value of the
Company's Investment in such Subsidiary as of the date of
such redesignation or (ii) such fair market value as of the
date on which such Subsidiary was originally designated as
an Unrestricted Subsidiary after December 5, 2003; and
(E) 50% of any dividends received by the Company or a
Guarantor after December 5, 2003 from an Unrestricted
Subsidiary of the Company, to the extent that such dividends
53
were not otherwise included in the Consolidated Net Income
of the Company for such period.
(b) The provisions of Section 4.07(a) hereof will not prohibit the
following actions:
(1) any purchase, redemption, repurchase, defeasance,
retirement or other acquisition of Capital Stock of the Company or
Subordinated Obligations made by exchange, including any such
exchange pursuant to the exercise of a conversion right or privilege
in connection with which cash is paid in lieu of the issuance of
fractional shares, for, or out of the proceeds of the substantially
concurrent sale of, Capital Stock of the Company, other than
Disqualified Stock and other than Capital Stock issued or sold to a
Subsidiary or an employee stock ownership plan or other trust
established by the Company or any of its Subsidiaries; provided that
the Net Cash Proceeds or reduction of Indebtedness from such sale or
exchange will be excluded in subsequent calculations of the amount of
Restricted Payments;
(2) any purchase, redemption, repurchase, defeasance,
retirement or other acquisition of Subordinated Obligations made by
exchange for, or out of the proceeds of the substantially concurrent
sale of, Subordinated Obligations of the Company that is permitted to
be Incurred under the provisions of Section 4.09 hereof;
(3) any purchase, redemption, repurchase, defeasance,
retirement or other acquisition of Subordinated Obligations from Net
Available Cash to the extent permitted by the provisions of Section
4.10 hereof;
(4) payment of dividends within 60 days after the date of
declaration of such dividends, if at the date of declaration such
dividend would have complied with Section 4.07(a) hereof;
(5) any purchase or redemption of any shares of Capital
Stock of the Company from employees or former employees of the
Company and its Restricted Subsidiaries pursuant to the repurchase
provisions under employee stock option or stock purchase agreements
or other agreements to compensate management or in connection with
the termination of employment in an aggregate amount after December
5, 2003 not in excess of $5 million in any fiscal year, plus any
unused amounts under this clause from prior fiscal years;
(6) the payment of any dividend by a Restricted Subsidiary
to the holders of all of its common equity interests on a pro rata
basis;
(7) any payments to the Permitted Holder made in connection
with, and substantially concurrent with the closing of, the
Acquisition by the Company and its Restricted Subsidiaries;
(8) any Permitted Payments to Parent;
(9) Restricted Payments not to exceed $50 million in the
aggregate since December 5, 2003; provided that no more than $25
million of such Restricted Payments are made in any calendar year;
provided further that, after giving pro forma effect to any such
Restricted Payment, the Company would have had a Leverage Ratio of
less than 2.5 to 1.00;
(10) Restricted Payments not to exceed $35 million in the
aggregate since December 5, 2003; and
54
(11) the repurchase, redemption or other acquisition or
retirement for value of Subordinated Obligations (a) with any
Remaining Excess Proceeds or (b) within 90 days following the
completion of an offer to purchase the Notes following a Change of
Control made in accordance with Section 4.15 hereof (including the
purchase of the Notes tendered), provided that such repurchase,
redemption or other acquisition or retirement for value of
Subordinated Obligations is required pursuant to the terms thereof as
a result of such Change of Control, at a price not to exceed 101% of
the outstanding principal amount thereof, plus any accrued and unpaid
interest.
The amount of all Restricted Payments (other than cash) will be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any assets or securities that are required to be
valued by this Section 4.07 will be determined by the Board of Directors whose
resolution with respect thereto will be delivered to the Trustee. The Board of
Directors' determination must be based upon an opinion or appraisal issued by
an accounting, appraisal or investment-banking firm of national standing if
the fair market value exceeds $20 million.
Section 4.08 Limitation on Restrictions on Distributions from Restricted
Subsidiaries.
(a) Neither the Company nor any Restricted Subsidiary will create or
otherwise cause or permit to exist any consensual restriction on the ability
of any Restricted Subsidiary to take the following actions:
(1) pay dividends or make any other distributions on its
Capital Stock or pay any Indebtedness or other obligations owed to
the Company or any of its Restricted Subsidiaries;
(2) make any loans or advances to the Company or any of its
Restricted Subsidiaries; or
(3) transfer any of its property or assets to the Company or
any of its Restricted Subsidiaries.
(b) The restrictions in Section 4.08(a) hereof will not apply to
encumbrances or restrictions existing or by reason of:
(1) the Credit Facilities and any agreements governing
Indebtedness existing on the date of this Indenture, in each case, as
in effect on the date of this Indenture and any amendments,
restatements, modifications, renewals, supplements, refundings,
replacements or refinancings of those agreements; provided that the
amendments, restatements, modifications, renewals, supplements,
refundings, replacements or refinancings are not materially more
restrictive, taken as a whole, with respect to such dividend and
other payment restrictions than those contained in those agreements
on the date of this Indenture;
(2) this Indenture, the Notes and the Note Guarantees;
(3) any restriction with respect to a Restricted Subsidiary
that is either:
(A) pursuant to an agreement relating to any
Indebtedness (i) Incurred by a Restricted Subsidiary before
the date on which such Restricted Subsidiary was acquired by
the Company, or (ii) of another Person that is assumed by
55
the Company or a Restricted Subsidiary in connection with
the acquisition of assets from, or merger or consolidation
with, such Person and is outstanding on the date of such
acquisition, merger or consolidation; provided that any
restriction with respect to a Restricted Subsidiary pursuant
to an agreement relating to Indebtedness Incurred either as
consideration in, or for the provision of any portion of the
funds or credit support used to consummate, the transaction
or series of related transactions pursuant to which such
Restricted Subsidiary became a Restricted Subsidiary or was
acquired by the Company, or such acquisition of assets,
merger or consolidation shall not be permitted pursuant to
this clause (A); or
(B) pursuant to any agreement, not relating to any
Indebtedness, existing when a Person becomes a Subsidiary of
the Company or acquired by the Company or any of its
Subsidiaries, that, in each case, is not created in
contemplation of such Person becoming such a Subsidiary or
such acquisition (it being understood for purposes of this
clause (B) that if another Person is the Successor Company,
any Subsidiary or agreement thereof shall be deemed acquired
or assumed by the Company when such Person becomes the
Successor Company),
and, in the case of clauses (A) and (B), which restriction
is not applicable to any Person, or the properties or assets
of any Person, other than the Person, or the properties or
assets of the Person, so acquired;
(4) any restriction with respect to a Restricted Subsidiary
pursuant to an agreement (a "Refinancing Agreement") that effects a
refinancing, extension, renewal or replacement of Indebtedness under
an agreement referred to in this Section 4.08 (an "Initial
Agreement") or contained in any amendment to an Initial Agreement;
provided that the restrictions contained in any such Refinancing
Agreement or amendment are not materially more restrictive, taken as
a whole, than the restrictions contained in the Initial Agreement or
Agreements to which such Refinancing Agreement or amendment relates;
(5) any restriction that is a customary restriction on
subletting, assignment or transfer of any property or asset that is
subject to a lease, license or similar contract, or on the assignment
or transfer of any lease, license or other contract;
(6) any restriction by virtue of a transfer, agreement to
transfer, option, right, or Lien with respect to any property or
assets of the Company or any Restricted Subsidiary not otherwise
prohibited by this Indenture;
(7) any restriction contained in mortgages, pledges or other
agreements securing Indebtedness of the Company or a Restricted
Subsidiary to the extent such restriction restricts the transfer of
the property subject to such mortgages, pledges or other security
agreements;
(8) any restriction with respect to a Restricted Subsidiary,
or any of its property or assets, imposed pursuant to an agreement
for the sale or disposition of all or substantially all the Capital
Stock or assets of such Restricted Subsidiary, or the property or
assets that are subject to such restriction, pending the closing of
such sale or disposition;
(9) any restriction existing by reason of applicable law,
rule, regulation or order;
56
(10) provisions limiting the disposition or distribution of
assets or property in joint venture agreements, asset sale
agreements, sale-leaseback agreements, stock sale agreements and
other similar agreements entered into with the approval of the
Company's Board of Directors, which limitation is applicable only to
the assets that are the subject of such agreements;
(11) restrictions on cash or other deposits or net worth
imposed by customers under contracts entered into in the ordinary
course of business;
(12) restrictions existing under Indebtedness or other
contractual requirements of a Receivables Subsidiary in connection
with a Qualified Receivables Transaction; provided that such
restrictions apply only to such Receivables Subsidiary; or
(13) restrictions contained in Indebtedness incurred by a
Foreign Subsidiary pursuant to clause (10) of Section 4.09(b) hereof;
provided that such restrictions relate only to one or more Foreign
Subsidiaries.
Section 4.09 Limitation on Indebtedness.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, Incur any Indebtedness; provided, however, that the Company and
any Restricted Subsidiary of the Company that is a Guarantor may incur
Indebtedness if, on the date of the Incurrence of such Indebtedness, the
Consolidated Coverage Ratio would be greater than 2.0 to 1.0.
(b) The provisions of Section 4.09(a) hereof will not prohibit the
Incurrence of any of the following items of Indebtedness (collectively,
"Permitted Debt"):
(1) the Incurrence by the Company and any Guarantor of
additional Indebtedness and letters of credit under one or more
Credit Facilities in an aggregate principal amount at any one time
outstanding under this clause (1) (with letters of credit being
deemed to have a principal amount equal to the maximum potential
liability of the Company and its Subsidiaries thereunder) not to
exceed the greater of (a) $275 million less the aggregate amount of
all Net Cash Proceeds of Asset Dispositions applied by the Company or
any of its Restricted Subsidiaries since the date of this Indenture
to permanently repay any term Indebtedness under a Credit Facility or
to permanently repay any revolving credit Indebtedness under a Credit
Facility and effect a corresponding commitment reduction thereunder
pursuant to the provisions of Section 4.10 hereof and (b) the amount
of the Borrowing Base as of the date of such Incurrence, in each case
less the aggregate amount of all commitment reductions with respect
to any revolving credit borrowings under a Credit Facility that have
been made by the Company or any of its Restricted Subsidiaries
resulting from or relating to the formation of any Receivables
Subsidiary or the consummation of any Qualified Receivables
Transaction;
(2) the Guarantee by the Company or any Guarantor of
Indebtedness of the Company or a Restricted Subsidiary that was
permitted to be Incurred by another provision of this Section 4.09;
(3) the Incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the
Company and any of its Restricted Subsidiaries; provided, however,
that:
(A) if the Company or any Guarantor is the obligor on
such Indebtedness, such Indebtedness must be expressly
subordinated to the prior payment in full in cash of all
57
obligations with respect to the Notes, in the case of the
Company, or the applicable Note Guarantee, in the case of a
Guarantor; and
(B) (i) any subsequent issuance or transfer of Capital
Stock that results in any such Indebtedness being held by a
Person other than the Company or a Restricted Subsidiary and
(ii) any sale or other transfer of any such Indebtedness to
a Person that is not either the Company or a Restricted
Subsidiary, will be deemed, in each case, to constitute an
Incurrence of such Indebtedness by the Company or such
Restricted Subsidiary, as the case may be, that was not
permitted by this clause;
(4) the Incurrence by the Company and the Guarantors of
Indebtedness represented by the Notes and the related Note
Guarantees;
(5) the Incurrence by the Company and any Restricted
Subsidiary of Indebtedness existing on the date of this Indenture
(other than the debt incurred under the Credit Agreement);
(6) the Incurrence by the Company or any of its Restricted
Subsidiaries of Refinancing Indebtedness in exchange for, or the net
proceeds of which are used to refund, refinance or replace
Indebtedness (other than intercompany Indebtedness) that was
permitted by this Indenture to be Incurred under Section 4.09(a)
hereof or clauses (2), (4), (5), (6), (7) or (14) of this Section
4.09(b);
(7) the Incurrence by the Company or any Restricted
Subsidiary of Indebtedness represented by Capitalized Lease
Obligations, mortgage financings or purchase money obligations, in
each case, Incurred for the purpose of financing all or any part of
the purchase price or cost of design, construction or improvement of
property, plant or equipment used in the business of the Company or a
Restricted Subsidiary, in an aggregate principal amount, including
all Refinancing Indebtedness Incurred to refund, refinance or replace
any Indebtedness Incurred pursuant to this clause (7), not to exceed
2.5% of Consolidated Tangible Assets at any time outstanding measured
at the time of Incurrence;
(8) the Incurrence by the Company or any Restricted
Subsidiary of Hedging Obligations that are Incurred in the ordinary
course of business and not for speculative purposes;
(9) the Incurrence by the Company or any Restricted
Subsidiary of Indebtedness evidenced by letters of credit issued in
the ordinary course of business of the Company to secure workers'
compensation and other insurance coverage;
(10) the Incurrence by the Foreign Subsidiaries of
Indebtedness if, at the time of Incurrence of such Indebtedness, and
after giving effect thereto, the aggregate principal amount of all
Indebtedness of the Foreign Subsidiaries Incurred pursuant to this
clause (10) and then outstanding does not exceed the greater of (A)
$30 million and (B) an amount equal to 50% of the consolidated book
value of the inventories of the Foreign Subsidiaries measured at the
time of Incurrence;
(11) the Incurrence by a Receivables Subsidiary of
Indebtedness in a Qualified Receivables Transaction that is without
recourse to the Company or to any other Restricted Subsidiary of the
Company or their assets (other than such Receivables Subsidiary and
its assets and, as to the Company or any Restricted Subsidiary of the
Company, other than pursuant to representations, warranties,
58
covenants and indemnities customary for such transactions) and is not
Guaranteed by any such Person;
(12) the Incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness in respect of workers' compensation
claims, self-insurance obligations, letters of credit (not supporting
Indebtedness for borrowed money), bankers' acceptances, performance
and surety bonds in the ordinary course of business;
(13) Indebtedness arising from agreements of the Company or
a Restricted Subsidiary providing for indemnification, contribution,
adjustment of purchase price, earn out or similar obligations, in
each case, incurred or assumed in connection with the disposition of
any business or assets of the Company or any Restricted Subsidiary or
Capital Stock of a Restricted Subsidiary; provided that the maximum
aggregate liability in respect of all such Indebtedness Incurred
pursuant to this clause (13) shall at no time exceed the gross
proceeds actually received by the Company and its Restricted
Subsidiaries in connection with such dispositions; and
(14) the Incurrence by the Company or any Restricted
Subsidiary of Indebtedness, which may include Bank Indebtedness, in
an aggregate principal amount not to exceed $35 million outstanding
at any one time.
The Company will not incur, and will not permit any Guarantor to
incur, any Indebtedness that is contractually subordinated in right of payment
to any other Indebtedness of the Company or such Guarantor unless such
Indebtedness is also contractually subordinated in right of payment to the
Notes and the applicable Guarantee on substantially identical terms; provided,
however, for the avoidance of doubt, that no Indebtedness will be deemed to be
contractually subordinated in right of payment to any other Indebtedness of
the Company solely by virtue of being unsecured or by virtue of being secured
on a first or junior lien basis.
For purposes of determining compliance with this Section 4.09, in the
event that an item of proposed Indebtedness meets the criteria of more than
one of the categories of Permitted Debt described in clauses (1) through (14)
above, or is entitled to be Incurred pursuant to Section 4.09(a) hereof, the
Company will be permitted to classify such item of Indebtedness on the date of
its Incurrence, or later reclassify, all or a portion of such item of
Indebtedness, in any manner that complies with this Section 4.09. Indebtedness
outstanding under Credit Facilities on the date on which Notes are first
issued and authenticated under this Indenture are initially deemed to have
been Incurred in reliance on the exception provided by Section 4.09(b)(1). In
addition, for purposes of determining compliance with this Section 4.09, the
accrual of interest, the accretion or amortization of original issue discount,
the payment of interest on any Indebtedness in the form of additional
Indebtedness with the same terms will not be deemed to be an Incurrence of
Indebtedness for purposes of this Section 4.09; provided that the amount
thereof shall be included in Consolidated Interest Expense of the Company as
accrued.
The Company will not permit any Unrestricted Subsidiary to Incur any
Indebtedness other than Non-Recourse Debt. However, if any such Indebtedness
ceases to be Non-Recourse Debt, then such event shall constitute an Incurrence
of Indebtedness by the Company or a Restricted Subsidiary.
Section 4.10 Limitation on Asset Dispositions.
(a) Neither the Company nor any Restricted Subsidiary shall make any
Asset Disposition unless:
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(1) the Company or such Restricted Subsidiary receives
consideration, including relief from, or the assumption of another
Person for, any liabilities, contingent or otherwise, at the time of
such Asset Disposition at least equal to the fair market value of the
shares and assets subject to such Asset Disposition. The Board of
Directors shall determine the fair market value, and their
determination shall be conclusive, including as to the value of all
non-cash consideration;
(2) at least 75% of the consideration for any Asset
Disposition received by the Company or such Restricted Subsidiary is
in the form of cash. For the purposes of this provision, the
following are deemed to be cash:
(A) Cash Equivalents;
(B) the assumption of Indebtedness of the Company,
other than Disqualified Stock of the Company, or any
Restricted Subsidiary and the release of the Company or such
Restricted Subsidiary from all liability on such
Indebtedness in connection with such Asset Disposition;
(C) Indebtedness of any Restricted Subsidiary that is
no longer a Restricted Subsidiary as a result of such Asset
Disposition, to the extent that the Company and each other
Restricted Subsidiary is released from any Guarantee, or is
the beneficiary of any indemnity with respect to such
Indebtedness which is secured by any letter of credit or
Cash Equivalents, of such Indebtedness in connection with
such Asset Disposition;
(D) securities received by the Company or any
Restricted Subsidiary from the transferee that are converted
by the Company or such Restricted Subsidiary into cash
within 60 days after the Asset Disposition;
(E) an amount equal to the fair market value of
Indebtedness of the Company or any Restricted Subsidiary
received by the Company or a Restricted Subsidiary as
consideration for any Asset Disposition, determined at the
time of receipt of such Indebtedness by the Company or such
Restricted Subsidiary; and
(F) consideration consisting of Additional Assets;
(3) the Company or such Restricted Subsidiary applies an
amount equal to 100% of the Net Available Cash from such Asset
Disposition in the following manner:
(A) to the extent the Company elects, or is required by
the terms of any secured Indebtedness, other than Preferred
Stock, to prepay, repay or purchase secured Indebtedness, in
each case other than Indebtedness owed to the Company or a
Restricted Subsidiary, within 365 days after the date of
such Asset Disposition;
(B) to the extent of the balance of Net Available Cash,
to the extent the Company or such Restricted Subsidiary
elects, to reinvest in Additional Assets (including by means
of an Investment in Additional Assets by a Restricted
Subsidiary with Net Available Cash received by the Company
or another Restricted Subsidiary) within 365 days from the
date of such Asset Disposition, or, if such reinvestment in
Additional Assets is a project that is authorized by the
Board of Directors within such 365-day period, within 455
days from the date of such Asset Disposition;
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(C) to the extent of the balance of such Net Available
Cash remaining after application pursuant to clauses (A) or
(B) above (the "Excess Proceeds"), to make an offer to
purchase Notes within 15 days after the periods specified in
clauses (A) and (B) above in accordance with Section 3.09
hereof at a price in cash equal to 100% of the principal
amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any, to the Purchase Date, and, to
the extent required by the terms thereof, any other
Indebtedness that is pari passu with the Notes subject to
the agreements governing such other Indebtedness at a
purchase price of 100% of the principal amount thereof plus
accrued and unpaid interest to the Purchase Date and
liquidated damages, if any; and
(D) to the extent of the balance of such Excess
Proceeds after application pursuant to clauses (A), (B) or
(C) of this Section 4.10(3) ("Remaining Excess Proceeds")
for any purpose not prohibited by this Indenture.
However, in connection with any prepayments, repayment or purchase of
revolving credit Indebtedness pursuant to clauses (A) and (C) of this Section
4.10(3), the Company or such Restricted Subsidiary will cause the related loan
commitment, if any, to be permanently reduced in an amount equal to the
principal amount so prepaid, repaid or purchased.
Pending the final application of any Net Available Cash, the Company
may temporarily reduce revolving credit borrowings or otherwise invest the Net
Available Cash in any manner that is not prohibited by this Indenture.
(b) Notwithstanding the other provisions of this Section 4.10, the
Company and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash in accordance with this Section 4.10, except to the extent that
the aggregate Net Available Cash from all Asset Dispositions made since
December 5, 2003 that is not applied in accordance with this Section 4.10
exceeds $15 million.
(c) To the extent that the aggregate principal amount of the Notes
and other Indebtedness that is pari passu with the Notes tendered pursuant to
an Asset Disposition Offer made in accordance with this Section 4.10 and
Section 3.09 hereof exceeds the amount of Excess Proceeds, the Notes and the
other pari passu Indebtedness will be purchased on a pro rata basis, based on
the aggregate principal amount thereof surrendered in such Asset Disposition
Offer; provided that when such Asset Disposition Offer is complete, the amount
of Excess Proceeds shall be reset to zero.
(d) The Company will comply with the requirements of Section 14(e) of
the Exchange Act and any other securities laws or regulations in connection
with the repurchase of Notes pursuant to this Section 4.10 and Section 3.09
hereof, in each case, to the extent applicable. To the extent that the
provisions of any securities laws or regulations conflict with provisions of
this Section 4.10 or Section 3.09 hereof, the Company will comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under this Section 4.10 or Section 3.09 hereof as a
result of such compliance.
Section 4.11 Limitation on Transactions with Affiliates.
(a) Neither the Company nor any of its Restricted Subsidiaries will
engage in any transaction or series of transactions, including the purchase,
sale, lease or exchange of any property or the rendering of any service with
any Affiliate of the Company (an "Affiliate Transaction") on terms that:
61
(1) taken as a whole are less favorable to the Company or
such Restricted Subsidiary than the terms that could be obtained at
the time of such transaction in arm's-length dealings with a
nonaffiliate; and
(2) in the event such Affiliate Transaction involves an
aggregate amount in excess of $15 million, is not in writing and has
not been approved by a majority of the members of the Board of
Directors having no material personal financial interest in such
Affiliate Transaction. If there are no such Board members, then the
Company must obtain a Fairness Opinion. A "Fairness Opinion" means an
opinion from an independent investment banking firm, accounting firm
or appraiser of national standing which indicates that the terms of
such transaction are fair to the Company or such Restricted
Subsidiary from a financial point of view.
In addition, any transaction involving aggregate payments or other
transfers by the Company and its Restricted Subsidiaries in excess of $30
million will also require a Fairness Opinion.
(b) The provisions of Section 4.11(a) hereof shall not prohibit the
following actions:
(1) any Restricted Payment permitted by the provisions of
Section 4.07 hereof or any Permitted Investment;
(2) the performance of the obligations of the Company or a
Restricted Subsidiary under any employment contract, collective
bargaining agreement, service agreement, employee benefit plan,
related trust agreement, severance agreement or any other similar
arrangement entered into in the ordinary course of business;
(3) payment of compensation, performance of indemnification
or contribution obligations in the ordinary course of business;
(4) any issuance, grant or award of stock, options or other
securities, to employees, officers or directors;
(5) any transaction between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries or any transaction
between a Receivables Subsidiary and any Person in which the
Receivables Subsidiary has an Investment;
(6) any other transaction arising out of agreements existing
on the date of this Indenture and described in the "Certain
Relationships and Related Party Transactions" section of the Offering
Memorandum;
(7) transactions with suppliers or other purchasers or
sellers of goods or services, in each case in the ordinary course of
business and on terms no less favorable to the Company or the
Restricted Subsidiary than those that could be obtained at such time
in arm's-length dealings with a nonaffiliate;
(8) the payment of rent due under the Master Lease, dated as
of March 23, 1999, between Gustine Sixth Avenue Associates, Ltd. and
General Nutrition, Incorporated, as in effect on the date of this
Indenture or as amended in compliance with the provisions of this
Section 4.11; and
(9) so long as no Default has occurred and is continuing,
(a) payment of annual management fees to the Permitted Holder in an
aggregate amount not to exceed, during any consecutive 12-month
period, $1.5 million, (b) the payment of fees to the Permitted Holder
for financial advisory and investment banking services rendered to
62
the Company and its Restricted Subsidiaries in connection with
acquisitions, securities offerings and other financings and similar
significant corporate transactions in customary and reasonable
amounts for such transactions, and (c) reimbursement of reasonable
out-of-pocket expenses incurred by the Permitted Holder in connection
with the services described in clauses (a) and (b) above; provided
that the foregoing payments and reimbursements are subordinated to
the Notes; provided further that if any such Default prevents the
payment of any such fees, the Company may pay such deferred fees at
the time such Default is cured or waived.
Section 4.12 Limitation on Liens.
Neither the Company nor any Restricted Subsidiary will create or
permit to exist any Lien, other than Permitted Liens, on any of its property
or assets, including Capital Stock, whether owned on the date of this
Indenture or thereafter acquired, securing any Indebtedness (the "Initial
Lien"), unless at the same time effective provision is made to secure the
obligations due under this Indenture and the Notes equally and ratably with
such obligation for so long as such obligation is secured by such Initial
Lien.
Any such Lien created in favor of the Notes will be automatically and
unconditionally released and discharged upon:
(1) the release and discharge of the Initial Lien to which
it relates; or
(2) any sale, exchange or transfer to a non-affiliate of the
Company of the property or assets secured by such Initial Lien, or of
all of the Capital Stock held by the Company or any Restricted
Subsidiary, or all or substantially all of the assets of any
Restricted Subsidiary creating such Lien.
Section 4.13 Limitation on the Sale or Issuance of Preferred Stock of
Restricted Subsidiaries.
The Company will not sell any shares of Preferred Stock of a
Restricted Subsidiary, and will not permit any Restricted Subsidiary to issue
or sell any shares of its Preferred Stock to any Person, other than to the
Company or a Restricted Subsidiary.
Section 4.14 Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect:
(1) its corporate existence, and the corporate, partnership
or other existence of each of its Subsidiaries, in accordance with
the respective organizational documents (as the same may be amended
from time to time) of the Company or any such Subsidiary; and
(2) the rights (charter and statutory), licenses and
franchises of the Company and its Subsidiaries;
provided, however, that the Company shall not be required to preserve any such
right, license or franchise, or the corporate, partnership or other existence
of any of its Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Subsidiaries, taken as a whole, and that the loss thereof
is not adverse in any material respect to the Holders of the Notes.
63
Section 4.15 Offer to Repurchase Upon Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder will have
the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple of $1,000) of that Holder's Notes, pursuant to
an offer that the Company will make to all Holders (a "Change of Control
Offer") at a purchase price in cash equal to 101% of the principal amount
thereof, plus accrued and unpaid interest and Liquidated Damages, if any, on
the Notes repurchased to the date of purchase, subject to the rights of
Holders on the relevant record date to receive interest due on the relevant
interest payment date the ("Change of Control Payment"). Unless the Company
has exercised its right to redeem all of the Notes pursuant to Section 3.07
hereof, the Company will, within thirty days following any Change of Control,
or at the Company's option, prior to such Change of Control but after the
public announcement thereof, mail a notice to each Holder with a copy to the
Trustee stating:
(1) that a Change of Control has occurred or will occur and
that such Holder has, or upon such occurrence will have, the right to
require the Company to purchase such Holder's Notes at a purchase
price in cash equal to 101% of the principal amount thereof, plus
accrued and unpaid interest to the date of purchase, and Liquidated
Damages, if any, subject to the right of Holders of Notes of record
on a record date to receive interest on the relevant interest payment
date;
(2) the circumstances and relevant facts and financial
information regarding such Change of Control;
(3) the date of purchase, which will be no earlier than 30
days nor later than 90 days from the date such notice is mailed (the
"Change of Control Payment Date");
(4) the instructions determined by the Company, consistent
with this Section 4.15, that a Holder must follow in order to have
its Notes purchased; and
(5) that, if such offer is made prior to such Change of
Control, payment is conditioned on the occurrence of such Change of
Control.
The Company will comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Notes pursuant to
this Section 4.15. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.15, the Company will
comply with the applicable securities laws and regulations and will not be
deemed to have breached its obligations under this Section 4.15 as a result of
such compliance.
Prior to repurchasing any Notes pursuant to this Section 4.15, but in
any event within 90 days following a Change of Control, the Company will
either repay all outstanding Indebtedness that restricts such repurchase or
obtain the requisite consents, if any, under all agreements governing such
outstanding Indebtedness, to permit the repurchase of Notes required by this
Section 4.15.
(b) On or before the Change of Control Payment Date, the Company
will, to the extent lawful:
(1) accept for payment all Notes or portions of Notes
properly tendered and not withdrawn pursuant to the Change of Control
Offer;
(2) deposit with the Paying Agent an amount equal to the
Change of Control Payment in respect of all Notes or portions of
Notes properly tendered and not withdrawn; and
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(3) deliver or cause to be delivered to the Trustee the
Notes properly accepted together with an Officer's Certificate
stating the aggregate principal amount of Notes or portions of Notes
being purchased by the Company.
The Paying Agent will promptly mail to each Holder of Notes properly
tendered and not withdrawn the Change of Control Payment for such Notes, and
the Trustee will promptly authenticate and mail (or cause to be transferred by
book entry) to each Holder a Note equal in principal amount to any unpurchased
portion of the Notes surrendered, if any. The Company will publicly announce
the results of the Change of Control Offer on or as soon as practicable after
the Change of Control Payment Date.
(c) Notwithstanding anything to the contrary in this Section 4.15, the Company
will not be required to make a Change of Control Offer upon a Change of
Control if (1) a third party makes the Change of Control Offer in the manner,
at the times and otherwise in compliance with the requirements set forth in
this Section 4.15 and Section 3.09 hereof and purchases all Notes properly
tendered and not withdrawn under the Change of Control Offer, or (2) notice of
redemption has been given pursuant to Section 3.07 hereof, unless and until
there is a default in payment of the applicable redemption price.
Section 4.16 No Amendment to Subordination Provisions
Without the consent of the Holders of at least a majority in
aggregate principal amount of the Notes then outstanding, the Company will not
amend, modify or alter the Subordinated Note Indenture in any way to amend the
provisions of Article 10 of the Subordinated Note Indenture (which relate to
subordination) in a manner adverse to the Holders of Notes.
Section 4.17 Additional Note Guarantees.
If the Company or any of its Restricted Subsidiaries acquires or
creates another Domestic Subsidiary after the date of this Indenture, then the
Company will cause that newly acquired or created Domestic Subsidiary to
execute a Note Guarantee pursuant to a supplemental indenture in form and
substance satisfactory to the Trustee and deliver an Opinion of Counsel to the
Trustee within 10 Business Days of the date on which it was acquired or
created to the effect that such supplemental indenture has been duly
authorized, executed and delivered by that Domestic Subsidiary and constitutes
a valid and binding agreement of that Domestic Subsidiary, enforceable against
that Domestic Subsidiary in accordance with its terms (subject to customary
exceptions); provided that any Domestic Subsidiary that constitutes an
Immaterial Subsidiary need not become a Guarantor until such time as it ceases
to be an Immaterial Subsidiary.
The form of such Note Guarantee is attached as Exhibit E hereto.
Section 4.18 Designation of Unrestricted Subsidiaries.
The Board of Directors of the Company may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if that designation would not
cause a Default; provided that in no event will a Subsidiary of the Company
that owns or holds the right to use, license or sublicense the "GNC" brand be
designated as an Unrestricted Subsidiary. If a Restricted Subsidiary is
designated as an Unrestricted Subsidiary, the aggregate fair market value of
all outstanding Investments owned by the Company and its Restricted
Subsidiaries in the Subsidiary designated as Unrestricted will be deemed to be
an Investment made as of the time of the designation and will reduce the
amount available for Restricted Payments under the provisions of Section 4.07
hereof or under one or more clauses of the definition of Permitted
Investments, as determined by the Company. That designation will only be
65
permitted if the Investment would be permitted at that time and if the
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary. The Board of Directors of the Company may redesignate any
Unrestricted Subsidiary to be a Restricted Subsidiary if that redesignation
would not cause a Default.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of a resolution of the Board of Directors giving effect to such
designation and an Officer's Certificate certifying that such designation
complied with the preceding conditions and was permitted by the provisions of
Section 4.07 hereof. If, at any time, any Unrestricted Subsidiary would fail
to meet the preceding requirements as an Unrestricted Subsidiary, it will
thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary will be deemed to be
Incurred by a Restricted Subsidiary of the Company as of such date and, if
such Indebtedness is not permitted to be Incurred as of such date under the
provisions of Section 4.09 hereof, the Company will be in default of such
Section 4.09 hereof. The Board of Directors of the Company may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary of the
Company; provided that such designation will be deemed to be an Incurrence of
Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary, and such designation will only
be permitted if (1) such Indebtedness is permitted under the provisions of
Section 4.09 hereof, calculated on a pro forma basis as if such designation
had occurred at the beginning of the four-quarter reference period; and (2) no
Default or Event of Default would be in existence following such designation.
ARTICLE 5
SUCCESSORS
Section 5.01 Merger, Consolidation, or Sale of Assets.
(a) The Company shall not, in a single transaction or a series of
related transactions, consolidate with or merge with or into, or convey or
transfer all or substantially all its assets to, any Person, unless:
(1) the resulting, surviving or transferee Person (the
"Successor Company") will be a Person organized and existing under
the laws of the United States of America, any State thereof or the
District of Columbia;
(2) the Successor Company, if not the Company, will
expressly assume, by a supplemental indenture, executed and delivered
to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Notes, this Indenture and the
Registration Rights Agreement;
(3) immediately after giving effect to such transaction or
series of transactions no Default or Event of Default exists;
(4) the Company or the Successor Company, if the Company is
not the continuing obligor under this Indenture, will, at the time of
such transaction or series of transactions and after giving pro forma
effect thereto as if such transaction or series of transactions had
occurred at the beginning of the applicable four-quarter period, be
permitted to Incur at least an additional $1.00 of Indebtedness under
paragraph (a) of Section 4.09 hereof, and
(5) the Company will have delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each to the effect
that such consolidation, merger or transfer and such supplemental
indenture, if any, comply with this Indenture; provided that:
66
(A) in giving such opinion such counsel may rely on
such Officer's Certificate as to any matters of fact,
including without limitation as to compliance with the
foregoing clauses; and
(B) no Opinion of Counsel will be required for a
consolidation, merger or transfer described in Section
5.01(c) hereof.
In addition, the Company will not, directly or indirectly, lease all
or substantially all of its properties or assets, in one or more related
transactions, to any other Person.
(b) The Successor Company will be substituted for, and may exercise
every right and power of, the Company under this Indenture. Thereafter, the
Company (if it is not the Successor Company) will be relieved of all
obligations and covenants under this Indenture, except that, in the case of a
conveyance or transfer of less than all its assets, the Company will not be
released from the obligation to pay the principal of and interest on the
Notes.
(c) The provisions of this Section 5.01 do not prohibit any
Restricted Subsidiary from consolidating with, merging into or transferring
all or part of its properties and assets to the Company. Additionally, the
Company may merge with an Affiliate incorporated or organized for the purpose
of reincorporating or reorganizing the Company in another jurisdiction to
realize tax or other benefits. The definition of "Successor Company" will not
include companies formed by consolidations, mergers or transfers of properties
or assets pursuant to this Section 5.01(c).
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.
(a) Each of the following is an "Event of Default":
(1) a default in any payment of interest on, or Liquidated
Damages, if any, with respect to, any Note when due, continued for 30
days;
(2) a default in the payment of principal of, or premium, if
any, on any Note when due at its Stated Maturity, upon optional
redemption, upon required repurchase, upon declaration or otherwise;
(3) the failure by the Company or any of its Restricted
Subsidiaries to comply with its obligations under Article 5 hereof;
(4) the failure by the Company or any of its Restricted
Subsidiaries to comply for 30 days after written notice from the
Trustee or the Holders of at least 25% in principal amount of the
outstanding Notes with any of its obligations under Sections 4.07,
4.09, 4.10 or 4.15, in each case, other than a failure to purchase
Notes;
(5) the failure by the Company or any of its Restricted
Subsidiaries to comply with its other agreements contained in the
Notes or this Indenture for 60 days after written notice from the
Trustee or the Holders of at least 25% in principal amount of the
outstanding Notes;
(6) the failure by the Company or any Significant Subsidiary
to pay any Indebtedness within any applicable grace period after
final maturity or the acceleration of any such Indebtedness by the
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holders thereof because of a default if the total amount of such
Indebtedness unpaid or accelerated exceeds $20 million;
(7) the Company or any of its Significant Subsidiaries:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief
against it in an involuntary case,
(C) consents to the appointment of a custodian of it or
for all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors;
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any of its
Significant Subsidiaries;
(B) appoints a custodian of the Company or any of its
Significant Subsidiaries or for all or substantially all of
the property of the Company or any of its Significant
Subsidiaries; or
(C) orders the liquidation of the Company or any of its
Significant Subsidiaries;
and the order or decree remains unstayed and in effect for
60 consecutive days; or
(9) the rendering of any judgment or decree for the payment
of money in an amount, net of any insurance or indemnity payments
actually received in respect thereof prior to or within 90 days from
the entry thereof, or to be received in respect thereof in the event
any appeal thereof shall be unsuccessful, in excess of $20 million
against the Company or a Significant Subsidiary that is not
discharged, bonded or insured by a third Person if either an
enforcement proceeding thereon is commenced, or such judgment or
decree remains outstanding for a period of 90 days and is not
discharged, waived or stayed; or
(10) the failure of any Guarantee of the Notes by a
Guarantor that is a Significant Subsidiary to be in full force,
except as contemplated by the terms thereof or of this Indenture, or
the denial in writing by any such Guarantor of its obligations under
this Indenture or any such Guarantee if such Default continues for 10
days.
(b) The events listed in Section 6.01(a) hereof will constitute
Events of Default regardless of their reasons, whether voluntary or
involuntary or whether effected by operation of law or pursuant to any
judgment, decree, order, rule or regulation of any administrative or
governmental body.
Section 6.02 Acceleration.
In the case of an Event of Default specified in clause (7) or (8) of
Section 6.01(a) hereof, with respect to the Company or any of its Significant
Subsidiaries, all outstanding Notes will become due and payable immediately
without further action or notice on the part of the Trustee or any Holder. If
any other Event of Default occurs and is continuing, the Trustee, by notice to
68
the Company, or the Holders of at least a majority in aggregate principal
amount of the then outstanding Notes, by notice to the Company and the
Trustee, may declare the principal of and accrued but unpaid interest on all
of the Notes to be due and payable immediately (and upon any such declaration,
the Notes shall become due and payable immediately); provided that so long as
any Indebtedness incurred pursuant to clause (i) of the definition of
Permitted Debt is outstanding, such acceleration will not be effective until
the earlier of (1) the acceleration of such Indebtedness incurred pursuant to
clause (i) of the definition of Permitted Debt and (2) five Business Days
after the holders of such Indebtedness incurred pursuant to clause (i) of the
definition of Permitted Debt or the Representative thereof receive notice from
the Company of the acceleration with respect to the payment of the Notes.
The Holders of a majority in aggregate principal amount of the then
outstanding Notes by written notice to the Trustee may, on behalf of all of
the Holders, rescind an acceleration and its consequences, if the rescission
would not conflict with any judgment or decree and if all existing Events of
Default (except nonpayment of principal, interest or premium or Liquidated
Damages, if any, that has become due solely because of the acceleration) have
been cured or waived.
Section 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium and
Liquidated Damages, if any, and interest on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Note in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. All
remedies are cumulative to the extent permitted by law.
Section 6.04 Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Notes (including in connection with an offer to purchase);
provided, however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its
consequences, including any related payment default that resulted from such
acceleration, if the rescission would not conflict with any judgment or decree
and if all existing Events of Default (except nonpayment of principal,
interest or premium or Liquidated Damages, if any, that has become due solely
because of the acceleration) have been cured or waived. 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 any
right consequent thereon.
Section 6.05 Control by Majority.
Holders of a majority in aggregate principal amount of the then
outstanding Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising
any trust or power conferred on it. However, the Trustee may refuse to follow
any direction that (a) conflicts with law or this Indenture, (b) the Trustee
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determines is unduly prejudicial to the rights of any other Holder of Notes or
(c) that would involve the Trustee in personal liability.
Section 6.06 Limitation on Suits.
Except to enforce the right to receive payment of principal, premium
and Liquidated Damages, if any, or interests when due, no Holder may pursue a
remedy with respect to this Indenture or the Notes unless:
(1) such Holder has previously given to the Trustee written
notice that an Event of Default is continuing;
(2) Holders of at least 25% in aggregate principal amount of
the then outstanding Notes have requested to the Trustee to pursue
the remedy;
(3) such Holder or Holders offer and, if requested, provide
to the Trustee reasonable security or indemnity against any loss,
liability or expense;
(4) the Trustee has not complied with the request within 60
days after receipt of the request and the offer of security or
indemnity; and
(5) during such 60-day period, Holders of a majority in
aggregate principal amount of the then outstanding Notes have not
given the Trustee a direction inconsistent with such request.
A Holder of a Note may not use this Indenture to prejudice the rights
of another Holder of a Note or to obtain a preference or priority over another
Holder of a Note.
Section 6.07 Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the provisions
of this Indenture relating to the right of any Holder of a Note to receive
payment of principal, premium and Liquidated Damages, if any, and interest on
the Note, on or after the respective due dates expressed in the Note
(including in connection with an offer to purchase) may not be changed, and
the right of any Holder, or to bring suit for the enforcement of any such
payment on or after such respective dates, shall not be impaired, in each
case, without the consent of such Holder.
Section 6.08 Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(a)(1) or (2) hereof
occurs and is continuing, the Trustee is authorized to recover judgment in its
own name and as trustee of an express trust against the Company for the whole
amount of principal of, premium and Liquidated Damages, if any, and interest
remaining unpaid on, the Notes and interest on overdue principal and, to the
extent lawful, interest and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
Section 6.09 Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and 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 agents and counsel)
and the Holders of the Notes allowed in any judicial proceedings relative to
the Company (or any other obligor upon the Notes), its creditors or its
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property and shall be entitled and empowered to collect, receive and
distribute any money or other property payable or deliverable on any such
claims and any custodian 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 to 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 7.07 hereof. To the extent
that the payment of any such compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. 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 Notes or the rights of any Holder, or to authorize
the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 6.10 Priorities.
If the Trustee collects any money pursuant to this Article 6, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation,
expenses and liabilities incurred, and all advances made, by the
Trustee and the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on
the Notes for principal, premium and Liquidated Damages, if any, and
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal,
premium and Liquidated Damages, if any and interest, respectively;
and
Third: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders of Notes pursuant to this Section 6.10.
Section 6.11 Undertaking for Costs.
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 or omitted
by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Company, a suit by
the Trustee, a suit by a Holder of a Note pursuant to Section 6.07 hereof, or
a suit by Holders of more than 10% in aggregate principal amount of the then
outstanding Notes.
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ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee will 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.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee will be determined solely by
the express provisions of this Indenture and the Trustee need perform
only those duties that are specifically set forth in this Indenture
and no others, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(2) 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, the Trustee will 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 liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph
(b) of this Section 7.01;
(2) the Trustee will not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee will 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 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), and (c) of this Section 7.01.
(e) No provision of this Indenture will require the Trustee to expend
or risk its own funds or incur any liability. In case an Event of Default
occurs and is continuing, the Trustee will be under no obligation to exercise
any of its rights and powers under this Indenture at the request of any
Holders, unless such Holder has offered to the Trustee reasonable security and
indemnity against any loss, liability or expense. Before taking any action
under this Indenture, the Trustee will be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses
caused by taking or not taking such action.
(f) The Trustee will not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held
in trust by the Trustee need not be segregated from other funds except to the
extent required by law.
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Section 7.02 Rights of Trustee.
(a) In connection with the Trustee's rights and duties under this
Indenture, the Trustee may conclusively rely upon 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 require
an Officer's Certificate or an Opinion of Counsel or both. The Trustee will
not be liable for any action it takes or omits to take in good faith in
reliance on such Officer's Certificate or Opinion of Counsel. The Trustee may
consult with counsel and the written advice of such counsel or any Opinion of
Counsel will be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and will not
be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee will not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights
or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company will be sufficient if
signed by an Officer of the Company.
(f) Except with respect to Section 4.01 hereof, the Trustee shall
have no duty to inquire as to the performance of the Company's covenants in
Article Four 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 6.01(a)(1), 6.01(a)(2) and 4.01 hereof or (ii)
any Default or Event of Default of which the Trustee shall have received
written notification in the manner set forth in this Indenture or an Officer
in the Corporate Trust Office of the Trustee shall have obtained actual
knowledge. Delivery of reports, information and documents to the Trustee under
Section 4.03 hereof is for informational purposes only and the Trustee's
receipt of the foregoing 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 an
Officer's Certificate).
Section 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee (if this Indenture has been qualified under
the TIA) or resign. Any Agent may do the same with like rights and duties.
Section 7.04 Trustee's Disclaimer.
The Trustee will not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of
this Indenture, it will not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee, and it will not be
responsible for any statement or recital herein or any statement in the Notes
73
or any other document in connection with the sale of the Notes or pursuant to
this Indenture other than its certificate of authentication.
Section 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee will mail to Holders of Notes a notice of
the Default or Event of Default within 90 days after it occurs. Except in the
case of a Default or Event of Default in payment of principal of, premium or
Liquidated Damages, if any, or interest on, any Note, the Trustee may withhold
the notice if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interests of the Holders of
the Notes.
Section 7.06 Reports by Trustee to Holders of the Notes.
(a) Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Notes remain
outstanding, the Trustee will mail to the Holders of the Notes a brief report
dated as of such reporting date that complies with TIA ss. 313(a) (but if no
event described in TIA ss. 313(a) has occurred within the twelve months
preceding the reporting date, no report need be transmitted). The Trustee also
will comply with TIA ss. 313(b)(2). The Trustee will also transmit by mail all
reports as required by TIA ss. 313(c).
(b) A copy of each report at the time of its mailing to the Holders
of Notes will be mailed by the Trustee to the Company and filed by the Trustee
with the SEC and each stock exchange on which the Notes are listed in
accordance with TIA ss. 313(d). The Company will promptly notify the Trustee
when the Notes are listed on any stock exchange.
Section 7.07 Compensation and Indemnity.
(a) The Company will pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation will not be limited by any law on compensation of a
trustee of an express trust. The Company will reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred
or made by it in addition to the compensation for its services. Such expenses
will include the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.
(b) The Company and the Guarantors will indemnify the Trustee against
any and all losses, liabilities or expenses incurred by it arising out of or
in connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture
against the Company and the Guarantors (including this Section 7.07) and
defending itself against any claim (whether asserted by the Company, the
Guarantors, any Holder or any other Person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except
to the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee will notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company will not relieve the Company or any of the Guarantors of their
obligations hereunder. The Company or such Guarantor will defend the claim and
the Trustee will cooperate in the defense. The Trustee may have separate
counsel and the Company will pay the reasonable fees and expenses of such
counsel. Neither the Company nor any Guarantor need pay for any settlement
made without its consent, which consent will not be unreasonably withheld.
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(c) The obligations of the Company and the Guarantors under this
Section 7.07 will survive the satisfaction and discharge of this Indenture.
(d) To secure the Company's and the Guarantors' payment obligations
in this Section 7.07, the Trustee will have a Lien prior to the Notes on all
money or property held or collected by the Trustee, except that held in trust
to pay principal and interest on particular Notes. Such Lien will survive the
satisfaction and discharge of this Indenture.
(e) When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(a)(7) or (8) hereof occurs, the
expenses and the compensation for the services (including the fees and
expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.
(f) The Trustee will comply with the provisions of TIA ss. 313(b)(2)
to the extent applicable.
Section 7.08 Replacement of Trustee.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee will become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 7.08.
(b) The Trustee may resign in writing at any time and be discharged
from the trust hereby created by so notifying the Company. The Holders of a
majority in aggregate principal amount of the then outstanding Notes may
remove the Trustee by so notifying the Trustee and the Company in writing. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(3) a custodian or public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company will promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office,
the Holders of a majority in aggregate principal amount of the then
outstanding Notes may appoint a successor Trustee to replace the successor
Trustee appointed by the Company.
(d) 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 Holders of at least 10% in aggregate principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(e) If the Trustee, after written request by any Holder who has been
a Holder for at least six months, fails to comply with Section 7.10 hereof,
such Holder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
(f) A successor Trustee will deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee will become effective, and the
successor Trustee will have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee will mail a notice of its
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succession to Holders. The retiring Trustee will promptly transfer all
property held by it as Trustee to the successor Trustee; provided all sums
owing to the Trustee hereunder have been paid and subject to the Lien provided
for in Section 7.07 hereof. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations under Section 7.07
hereof will continue for the benefit of the retiring Trustee.
Section 7.09 Successor Trustee by Merger, etc.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act will be the
successor Trustee.
Section 7.10 Eligibility; Disqualification.
There will at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or
state authorities and that has a combined capital and surplus of at least
$100.0 million as set forth in its most recent published annual report of
condition.
This Indenture will always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.
The Company may at any time elect to have either Section 8.02 or 8.03
hereof be applied to all outstanding Notes upon compliance with the conditions
set forth below in this Article 8.
Section 8.02 Legal Defeasance and Discharge.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be deemed to have been discharged from their obligations with respect
to all outstanding Notes (including the Note Guarantees) and this Indenture on
the date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company and
the Guarantors will be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes (including the Note
Guarantees), which will thereafter be deemed to be "outstanding" only for the
purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in clauses (1) and (2) below, and to have satisfied all their
other obligations under such Notes, the Note Guarantees and this Indenture
(and the Trustee, on demand of and at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the following
provisions which will survive until otherwise terminated or discharged
hereunder:
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(1) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, or interest or premium and
Liquidated Damages, if any, on, such Notes when such payments are due
from the trust referred to in Section 8.04 hereof;
(2) the Company's obligations with respect to such Notes
under Article 2 and Section 4.02 hereof;
(3) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's and the Guarantors' obligations
in connection therewith; and
(4) this Article 8.
Subject to compliance with this Article 8, the Company may exercise
its option under this Section 8.02 notwithstanding the prior exercise of its
option under Section 8.03 hereof.
Section 8.03 Covenant Defeasance.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company and each of the Guarantors will,
subject to the satisfaction of the conditions set forth in Section 8.04
hereof, be released from each of their obligations under the covenants
contained in Sections 4.03, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15,
4.16, 4.17, 4.18 hereof and clauses (3) and (4) of Section 5.01 hereof with
respect to the outstanding Notes on and after the date the conditions set
forth in Section 8.04 hereof are satisfied (hereinafter, "Covenant
Defeasance"), and the Notes will 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 will continue to be deemed "outstanding" for all other purposes
hereunder (it being understood that such Notes will not be deemed outstanding
for accounting purposes). For this purpose, Covenant Defeasance means that,
with respect to the outstanding Notes and Note Guarantees, the Company and the
Guarantors may omit to comply with and will 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 and such omission to comply will not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes and
Note Guarantees will be unaffected thereby. In addition, upon the Company's
exercise under Section 8.01 hereof of the option applicable to this Section
8.03, subject to the satisfaction of the conditions set forth in Section 8.04
hereof, Sections 6.01(a)(4) through 6.01(a)(10) hereof will not constitute
Events of Default; provided that clauses (7) and (8) of Section 6.01(a) hereof
will continue to constitute Events of Default with respect to the Company, but
not any Significant Subsidiary.
Section 8.04 Conditions to Legal or Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance
under either Section 8.02 or 8.03 hereof:
(1) the Company must irrevocably deposit with the Trustee,
in trust, for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Obligations, or a combination thereof, in
such amounts as will be sufficient, in the opinion of a nationally
recognized investment bank, appraisal firm, or firm of independent
public accountants, to pay the principal of, premium and Liquidated
Damages, if any, and interest on, the outstanding Notes on the stated
date for payment thereof or on the applicable redemption date, as the
case may be, and the Company must specify whether the Notes are being
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defeased to such stated date for payment or to a particular
redemption date;
(2) in the case of an election under Section 8.02 hereof,
the Company must deliver to the Trustee an Opinion of Counsel
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 of this Indenture, there has been a
change in the applicable federal income tax law,
in either case to the effect that the Holders of the
outstanding 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;
(3) in the case of an election under Section 8.03 hereof,
the Company must deliver to the Trustee an Opinion of Counsel
confirming that the Holders of the outstanding 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 on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not
occurred;
(4) no Default or Event of Default shall have occurred and
be continuing on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied
to such deposit);
(5) such Legal Defeasance or Covenant Defeasance will not
result in a breach or violation of, or constitute a default under,
any material agreement or instrument (other than this Indenture) to
which the Company or any of its Subsidiaries is a party or by which
the Company or any of its Subsidiaries is bound;
(6) the Company must deliver to the Trustee an Officer's
Certificate stating that the deposit was not made by the Company with
the intent of preferring the Holders of Notes over the other
creditors of the Company with the intent of defeating, hindering,
delaying or defrauding any creditors of the Company or others; and
(7) the Company must deliver to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all
conditions precedent relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.
Section 8.05 Deposited Money and Government Securities to be Held in
Trust; Other Miscellaneous Provisions.
Subject to Section 8.06 hereof, all money and non-callable Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
will be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly
or through any Paying Agent (including the Company acting as Paying Agent) as
78
the Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium and Liquidated Damages, if
any, and interest, but such money need not be segregated from other funds
except to the extent required by law.
The Company will pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the cash or non-callable
Government Obligations deposited pursuant to Section 8.04 hereof 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 the
outstanding Notes.
Notwithstanding anything in this Article 8 to the contrary, the
Trustee will deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the opinion
delivered under Section 8.04(1) hereof), are in excess of the amount thereof
that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
Section 8.06 Repayment to Company.
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 or
Liquidated Damages, if any, or interest on, any Note and remaining unclaimed
for two years after such principal, premium or Liquidated Damages, if any, or
interest has become due and payable shall be paid to the Company on its
request or (if then held by the Company) will be discharged from such trust;
and the Holder of such Note will thereafter be permitted to look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, will 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 will 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 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. dollars or
non-callable Government Obligations in accordance with Section 8.02 or 8.03
hereof, 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's and the Guarantors' obligations under this
Indenture and the Notes and the Note Guarantees will be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 8.02 or 8.03 hereof, as the case may be;
provided, however, that, if the Company makes any payment of principal of,
premium or Liquidated Damages, if any, or interest on, any Note following the
reinstatement of its obligations, the Company will be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by
the Trustee or Paying Agent.
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ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01 Without Consent of Holders of Notes.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture or the Notes
or the Note Guarantees without the consent of any Holder of Note:
(1) to cure any ambiguity, omission, defect or
inconsistency;
(2) to provide for the assumption by a successor corporation
of the obligations of the Company under this Indenture;
(3) to provide for uncertificated Notes in addition to or in place of
certificated notes; provided, however, that the uncertificated Notes
are issued in registered form for purposes of Section 163(f) of the
Code, or in a manner such that the uncertificated Notes are described
in Section 163(f)(2)(B) of the Code;
(4) to add Guarantees with respect to the Notes, to secure
the Notes, to add to the covenants of the Company for the benefit of
the Holders or to surrender any right or power conferred upon the
Company;
(5) to make any change that does not adversely affect the
rights of any Holder;
(6) to comply with any requirement of the SEC in connection
with the qualification of this Indenture under the TIA;
(7) to conform the text of this Indenture, the Note
Guarantees or the Notes to any provision of the Description of Notes
to the extent that such provision in the Description of Notes was
intended to be a verbatim recitation of a provision of this
Indenture, the Note Guarantees or the Notes; or
(8) to provide for the issuance of Additional Notes in
accordance with the limitations set forth in this Indenture as of the
date hereof.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee will join with the Company and
the Guarantors in the execution of any amended or supplemental indenture
authorized or permitted by the terms of this Indenture and to make any further
appropriate agreements and stipulations that may be therein contained, but the
Trustee may in its discretion, but will not be obligated to, enter into such
amended or supplemental indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02 With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture (including, without limitation,
Section 3.09, 4.10 and 4.15 hereof) and the Notes and the Note Guarantees with
the consent of the Holders of at least a majority in aggregate principal
amount of the then outstanding Notes (including, without limitation,
Additional Notes, if any) voting as a single class (including, without
80
limitation, consents obtained in connection with a tender offer or exchange
offer for, or purchase of, the Notes), and, subject to Sections 6.04 and 6.07
hereof, any existing Default or Event of Default (other than a Default or
Event of Default in the payment of the principal of, premium or Liquidated
Damages, if any, or interest on, the Notes, except a payment default resulting
from an acceleration that has been rescinded) or compliance with any provision
of this Indenture or the Notes or the Note Guarantees may be waived with the
consent of the Holders of at least a majority in aggregate principal amount of
the then outstanding Notes (including, without limitation, Additional Notes,
if any) voting as a single class (including, without limitation, consents
obtained in connection with a tender offer or exchange offer for, or purchase
of, the NOTES). Section 2.08 hereof shall determine which Notes are considered
to be "outstanding" for purposes of this Section 9.02.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or
supplemental indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee will join with the Company and the Guarantors
in the execution of such amended or supplemental indenture unless such amended
or supplemental indenture directly affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but will not be obligated to, enter into such amended or
supplemental indenture.
It is not necessary for the consent of the Holders of Notes under
this Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it is sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company will mail to the Holders of Notes affected
thereby a notice briefly describing the amendment, supplement or waiver. Any
failure of the Company to mail such notice, or any defect therein, will not,
however, in any way impair or affect the validity of any such amended or
supplemental indenture or waiver.
However, without the consent of each Holder affected, an amendment,
supplement or waiver under this Section 9.02 may not (with respect to any
Notes held by a non-consenting Holder):
(1) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the rate of or extend the time for payment of
interest on any Note;
(3) reduce the principal amount of or extend the Stated
Maturity of any Note;
(4) reduce the premium payable upon the redemption or
repurchase of any Note or change the time at which any Note may be
redeemed as described in the provisions of Section 3.07 hereof;
(5) make any Note payable in money other than that stated in
the Note;
(6) make any change in the provisions of this Indenture
relating to the rights of Holders of Notes to receive payment of
principal of, and interest, premium or Liquidated Damages on, the
Notes on or after the respective due dates expressed in the Notes or
impair the rights of any Holder of notes to xxx for the enforcement
81
of any payment of principal of, or interest, premium or Liquidated
Damages on, such Holder's Notes on or after the respective due dates;
(7) release any Guarantor from any of its obligations under
its Note Guarantee or this Indenture, except in accordance with the
terms of this Indenture; or
(8) make any change in the preceding amendment and waiver
provisions that require each Holder's consent or in the waiver
provisions.
Section 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes will be
set forth in a amended or supplemental indenture that complies with the TIA as
then in effect.
Section 9.04 Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective (as
determined by the Company and which may be prior to any such amendment,
supplement or waiver becoming operative), a consent to it by a Holder of a
Note is a continuing consent by the Holder of a Note and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note (if so provided pursuant to any solicitation
of such consent) if the Trustee receives written notice of revocation before
the date the amendment, supplement or waiver becomes effective (as determined
by the Company and which may be prior to any such amendment, supplement or
waiver becoming operative). An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.
Section 9.05 Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note will not
affect the validity and effect of such amendment, supplement or waiver.
Section 9.06 Trustee to Sign Amendments, etc.
The Trustee will sign any amended or supplemental indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee
and if such amendment or supplement does so adversely affect the rights,
duties, liabilities or immunities of the Trustee, the Trustee may, in its
discretion, but shall not be obligated to sign such amendment or supplement.
In executing any amended or supplemental indenture, the Trustee will be
entitled to receive and (subject to Section 7.01 hereof) will be fully
protected in relying upon, in addition to the documents required by Section
12.04 hereof, an Officer's Certificate and an Opinion of Counsel stating that
the execution of such amended or supplemental indenture is authorized or
permitted by this Indenture.
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ARTICLE 10
NOTE GUARANTEES
Section 10.01 Guarantee.
(a) Subject to this Article 10, each of the Guarantors hereby, jointly
and severally, unconditionally guarantees to each Holder of a Note
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 Notes or the obligations of the Company hereunder or
thereunder, that:
(1) the principal of, premium and Liquidated Damages, if
any, and interest on, the Notes will be promptly paid in full when
due, whether at maturity, by acceleration, redemption or otherwise,
and interest on the overdue principal of and interest on the Notes,
if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder will be promptly paid
in full or performed, all in accordance with the terms hereof and
thereof; and
(2) in case of any extension of time of payment or renewal
of any Notes or any of such other obligations, that same will be
promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Guarantors will be jointly
and severally obligated to pay the same immediately. Each Guarantor agrees
that this is a guarantee of payment and not a guarantee of collection.
(b) The Guarantors hereby agree that their obligations hereunder are
unconditional, irrespective of the validity, regularity or enforceability of
the Notes or this Indenture, the absence of any action to enforce the same,
any waiver or consent by any Holder of the Notes with respect to any
provisions hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
Each Guarantor hereby 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, protest,
notice and all demands whatsoever and covenant that this Note Guarantee will
not be discharged except by complete performance of the obligations contained
in the Notes and this Indenture.
(c) If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Guarantors or any custodian, trustee, liquidator
or other similar official acting in relation to either the Company or the
Guarantors, any amount paid by either to the Trustee or such Holder in respect
of the Notes, the Note Guarantee, to the extent theretofore discharged, will
be reinstated in full force and effect.
(d) 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 the Guarantors, on the one
hand, and the Holders and the Trustee, on the other hand, (1) the maturity of
the obligations guaranteed hereby may be accelerated as provided in Article 6
hereof for the purposes of this Note Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (2) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) will forthwith become due and
payable by the Guarantors for the purpose of this Note Guarantee. The
Guarantors will have the right to seek contribution from any non-paying
83
Guarantor so long as the exercise of such right does not impair the rights of
the Holders under the Note Guarantee.
Section 10.02 Limitation on Guarantor Liability.
Each Guarantor, and by its acceptance of Notes, each Holder, hereby
confirms that it is the intention of all such parties that the Note Guarantee
of such Guarantor not constitute a fraudulent transfer or conveyance for
purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar federal or state law to the extent
applicable to any Note Guarantee. To effectuate the foregoing intention, the
Trustee, the Holders and the Guarantors hereby irrevocably agree that the
obligations of such Guarantor will be limited to the maximum amount that will,
after giving effect to such maximum amount and all other contingent and fixed
liabilities of such Guarantor that are relevant under such laws, including any
Guarantees under the Credit Facilities, and after giving effect to any
collections from, rights to receive contribution from or payments made by or
on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 10, result in the obligations of such Guarantor
under its Note Guarantee not constituting a fraudulent transfer or conveyance.
Section 10.03 Execution and Delivery of Note Guarantee.
To evidence its Note Guarantee set forth in Section 10.01 hereof,
each Guarantor hereby agrees that a notation of such Note Guarantee
substantially in the form attached as Exhibit E hereto will be endorsed by an
Officer of such Guarantor on each Note authenticated and delivered by the
Trustee and that this Indenture will be executed on behalf of such Guarantor
by one of its Officers.
Each Guarantor hereby agrees that its Note Guarantee set forth in
Section 10.01 hereof will remain in full force and effect notwithstanding any
failure to endorse on each Note a notation of such Note Guarantee.
If an Officer whose signature is on this Indenture or on the Note
Guarantee no longer holds that office at the time the Trustee authenticates
the Note on which a Note Guarantee is endorsed, the Note Guarantee will be
valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, will constitute due delivery of the Note Guarantee set
forth in this Indenture on behalf of the Guarantors.
In the event that the Company or any of its Restricted Subsidiaries
creates or acquires any Domestic Subsidiary after the date of this Indenture,
if required by Section 4.17 hereof, the Company will cause such Domestic
Subsidiary to comply with the provisions of Section 4.17 hereof and this
Article 10, to the extent applicable.
Section 10.04 Guarantors May Consolidate, etc., on Certain Terms.
Except as otherwise provided in Section 10.05 hereof, no Guarantor
may sell or otherwise dispose of all or substantially all of its assets to, or
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, other than the Company or a Wholly Owned
Subsidiary of the Company that is a Guarantor, unless:
(1) the provisions of this Indenture, including Section 4.10
hereof, are complied with; and
84
(2) such Guarantor is released from all of its obligations
under this Indenture and its Note Guarantee pursuant to Section 10.05
hereof; provided that termination of the Note Guarantee will only
occur to the extent that the Guarantor's obligations under the Credit
Facilities and all of its Guarantees of any other Indebtedness of the
Company also terminate.
Except as set forth in Articles 4 and 5 hereof, nothing contained in
this Indenture or in any of the Notes will prevent any consolidation or merger
of a Guarantor with or into the Company or a Wholly Owned Subsidiary of the
Company that is a Guarantor, or will prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an entirety to the
Company or a Wholly Owned Subsidiary of the Company that is a Guarantor.
Section 10.05 Releases.
(a) In the event of any sale or other disposition of all or
substantially all of the assets of any Guarantor, by way of merger,
consolidation or otherwise, or a sale or other disposition of all of the
Capital Stock of any Guarantor, in each case to a Person that is not (either
before or after giving effect to such transactions) the Company or a
Restricted Subsidiary of the Company, then such Guarantor (in the event of a
sale or other disposition, by way of merger, consolidation or otherwise, of
all of the Capital Stock of such Guarantor) or the Person acquiring the
property (in the event of a sale or other disposition of all or substantially
all of the assets of such Guarantor) will be released and relieved of any
obligations under its Note Guarantee; provided that the Net Proceeds of such
sale or other disposition are applied in accordance with the applicable
provisions of this Indenture, including without limitation Section 4.10
hereof. Upon delivery by the Company to the Trustee of an Officer's
Certificate and an Opinion of Counsel to the effect that such sale or other
disposition was made by the Company in accordance with the provisions of this
Indenture, including without limitation Section 4.10 hereof, the Trustee will
execute any documents reasonably required in order to evidence the release of
any Guarantor from its obligations under its Note Guarantee.
(b) Upon designation of any Guarantor as an Unrestricted Subsidiary
in accordance with the terms of this Indenture, such Guarantor will be
released and relieved of any obligations under its Note Guarantee.
(c) Upon Legal Defeasance in accordance with Article 8 hereof or
satisfaction and discharge of this Indenture in accordance with Article 11
hereof, each Guarantor will be released and relieved of any obligations under
its Note Guarantee.
Any Guarantor not released from its obligations under its Note
Guarantee as provided in this Section 10.05 will remain liable for the full
amount of principal of and interest and premium and Liquidated Damages, if
any, on the Notes and for the other obligations of any Guarantor under this
Indenture as and to the extent provided in this Article 10.
ARTICLE 11
SATISFACTION AND DISCHARGE
Section 11.01 Satisfaction and Discharge.
This Indenture will be discharged and will cease to be of further
effect as to all Notes issued hereunder, when:
(1) either:
(a) all Notes that have been authenticated, except
lost, stolen or destroyed Notes that have been replaced or
paid and Notes for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Company,
have been delivered to the Trustee for cancellation; or
(b) all Notes that have not been delivered to the
Trustee for cancellation have become due and payable by
reason of the mailing of a notice of redemption or otherwise
or will become due and payable within one year and the
Company or any Guarantor has irrevocably deposited or caused
to be deposited with the Trustee as trust funds in trust
solely for the benefit of the Holders, cash in U.S. dollars,
non-callable Government Securities, or a combination
thereof, in such amounts as will be sufficient, without
consideration of any reinvestment of interest, to pay and
discharge the entire Indebtedness on the Notes not delivered
to the Trustee for cancellation for principal, premium and
Liquidated Damages, if any, and accrued interest to the date
of maturity or redemption;
(2) no Default or Event of Default has occurred and is
continuing on the date of such deposit (other than a Default or Event
of Default resulting from the borrowing of funds to be applied to
such deposit) and the deposit will not result in a breach or
violation of, or constitute a default under, any other instrument to
which the Company or any Guarantor is a party or by which the Company
or any Guarantor is bound;
(3) the Company or any Guarantor has paid or caused to be
paid all sums payable by it under this Indenture; and
(4) the Company has delivered irrevocable instructions to
the Trustee under this Indenture to apply the deposited money toward
the payment of the Notes at maturity or on the redemption date, as
the case may be.
In addition, the Company must deliver an Officers' Certificate and an Opinion
of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge have been satisfied.
Notwithstanding the satisfaction and discharge of this Indenture, if
money has been deposited with the Trustee pursuant to subclause (b) of clause
(1) of this Section 11.01, the provisions of Sections 11.02 and 8.06 hereof
will survive. In addition, nothing in this Section 11.01 will be deemed to
discharge those provisions of Section 7.07 hereof, that, by their terms,
survive the satisfaction and discharge of this Indenture.
Section 11.02 Application of Trust Money.
Subject to the provisions of Section 8.06 hereof, all money deposited
with the Trustee pursuant to Section 11.01 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium and
Liquidated Damages, if any) and interest for whose payment such money has been
deposited with the Trustee; but such money need not be segregated from other
funds except to the extent required by law.
If the Trustee or Paying Agent is unable to apply any money or
Government Securities in accordance with Section 11.01 hereof by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
85
application, the Company's and any Guarantor's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit
had occurred pursuant to Section 11.01 hereof; provided that if the Company
has made any payment of principal of, premium or Liquidated Damages, if any,
or interest on, any Notes because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money or Government Securities held by the
Trustee or Paying Agent.
ARTICLE 12
MISCELLANEOUS
Section 12.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA ss.318(c), the imposed duties will control.
Section 12.02 Notices.
Any notice or communication by the Company, any Guarantor or the
Trustee to the others is duly given if in writing and delivered in Person or
by first class mail (registered or certified, return receipt requested),
facsimile transmission or overnight air courier guaranteeing next day
delivery, to the others' address:
If to the Company and/or any Guarantor:
General Nutrition Centers, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Chief Legal Officer
With a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 X. Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx Xxxxx
If to the Trustee:
U.S. Bank National Association
EP-MN-WS3C
00 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Corporate Trust Department
The Company, any Guarantor or the Trustee, by notice to the others,
may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to Holders)
will be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
86
postage prepaid, if mailed; when receipt acknowledged, if transmitted by
facsimile; and the next Business Day after timely delivery to the courier, if
sent by overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder will be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next day delivery to its address shown on the register
kept by the Registrar. Any notice or communication will also be so mailed to
any Person described in TIA ss. 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it will
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it will
mail a copy to the Trustee and each Agent at the same time.
Section 12.03 Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Notes. The Company,
the Trustee, the Registrar and anyone else shall have the protection of TIA
ss. 312(c).
Section 12.04 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,
upon request:
(1) an Officer's Certificate in form and substance
reasonably satisfactory to the Trustee (which must include the
statements set forth in Section 12.05 hereof) stating that, in the
opinion of the signers, all conditions precedent and covenants, if
any, provided for in this Indenture relating to the proposed action
have been satisfied; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which must include the statements set
forth in Section 12.05 hereof) stating that, in the opinion of such
counsel, all such conditions precedent and covenants have been
satisfied.
Section 12.05 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) must comply with the provisions of TIA
ss. 314(e) and must include:
(1) a statement that the Person making such certificate or
opinion has read such covenant 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 opinion of such Person, he or
she has made such examination or investigation as is necessary to
enable him or her to express an informed opinion as to whether or not
such covenant or condition has been satisfied; and
87
(4) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
Section 12.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 12.07 No Personal Liability of Directors, Officers, Employees and
Stockholders.
No director, officer, employee, incorporator or stockholder of the
Company or any Guarantor, as such, will have any liability for any obligations
of the Company or any Guarantor under the Notes, this Indenture, the Note
Guarantees, or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes. The waiver may not be effective to
waive liabilities under the federal securities laws.
Section 12.08 Governing Law.
THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK, INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE NEW YORK OBLIGATIONS LAW.
Section 12.09 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 12.10 Successors.
All agreements of the Company in this Indenture and the Notes will
bind its successors. All agreements of the Trustee in this Indenture will bind
its successors. All agreements of each Guarantor in this Indenture will bind
its successors, except as otherwise provided in Section 10.05 hereof.
Section 12.11 Severability.
In case any provision in this Indenture or in the Notes is invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions will not in any way be affected or impaired thereby.
Section 12.12 Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each
signed copy will be an original, but all of them together represent the same
agreement.
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Section 12.13 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part of this Indenture and will in
no way modify or restrict any of the terms or provisions hereof.
[Signatures on following page]
89
SIGNATURES
Dated as of January 18, 2005
GENERAL NUTRITION CENTERS, INC.
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President, Chief Legal
Officer and Secretary
GENERAL NUTRITION INVESTMENT COMPANY
NUTRA SALES CORPORATION
GNC (CANADA) HOLDING COMPANY
GENERAL NUTRITION DISTRIBUTION COMPANY
GENERAL NUTRITION GOVERNMENT SERVICES, INC.
GENERAL NUTRITION INTERNATIONAL, INC.
GN INVESTMENT, INC.
GNC CANADA LIMITED
GNC US DELAWARE, INC.
GENERAL NUTRITION SYSTEMS, INC.
INFORMED NUTRITION, INC.
GENERAL NUTRITION CORPORATION
GENERAL NUTRITION DISTRIBUTION, L.P.
GENERAL NUTRITION INCORPORATED
GNC FRANCHISING, LLC
NUTRA MANUFACTURING, INC.
GENERAL NUTRITION COMPANIES, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President, Chief Legal
Officer and Secretary
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President
EXHIBIT A1
[Face of Note]
--------------------------------------------------------------------------------
CUSIP/CINS ____________
8-5/8% Senior Notes due 2011
No. ___ $____________
GENERAL NUTRITION CENTERS, INC.
promises to pay to ______________ or registered assigns,
the principal sum of __________________________________________________________
DOLLARS on January 15, 2011.
Interest Payment Dates: January 15 and July 15
Record Dates: January 1 and July 1
Dated: __________________
GENERAL NUTRITION CENTERS, INC.
By:
-------------------------------------------
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
[TRUSTEE],
as Trustee
By:
------------------------------
Authorized Signatory
--------------------------------------------------------------------------------
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[Back of Note]
8-5/8% Senior Notes due 2011
[Insert the Global Note Legend, if applicable pursuant to the provisions of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the provisions
of the Indenture]
Capitalized terms used herein have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
(1) INTEREST. General Nutrition Centers, Inc., a Delaware
corporation (the "Company"), promises to pay interest on the principal
amount of this Note at 8-5/8% per annum from ________________, 20__
until maturity and shall pay the Liquidated Damages, if any, payable
pursuant to Section 5 of the Registration Rights Agreement referred to
below. The Company will pay interest and Liquidated Damages, if any,
semi-annually in arrears on January 15 and July 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day
(each, an "Interest Payment Date"). Interest on the Notes will accrue
from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of original issuance; provided
that if there is no existing Default in the payment of interest, and if
this Note is authenticated between a record date referred to on the
face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided
further that the first Interest Payment Date shall be _____________,
20__. The Company will pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at the rate that is then
in effect on the Notes to the extent lawful; it will pay interest
(including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Liquidated
Damages, if any, (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest
will be computed on the basis of a 360-day year of twelve 30-day
months.
(2) METHOD OF PAYMENT. The Company will pay interest on the
Notes (except defaulted interest) and Liquidated Damages, if any, to
the Persons who are registered Holders of Notes at the close of
business on the January 1 or July 1, as the case may be, next preceding
the applicable Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to
defaulted interest. If a Holder has given wire instructions to the
Company, the Company will pay all principal, interest and premium and
Liquidated Damages, if any, on that Holder's Notes in accordance with
those instructions. All other payments on the Notes will be made 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 interest and Liquidated Damages, if any, may be made by check mailed
to the Holders at their addresses set forth in the register of Holders;
provided that payment by wire transfer of immediately available funds
to the accounts specified by the Depositary, or its nominee will be
required with respect to principal of and interest, premium and
Liquidated Damages, if any, on, all Global Notes. Such payment will be
in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
(3) PAYING AGENT AND REGISTRAR. Initially, U.S. Bank, National
Association, the Trustee under the Indenture, will act as Paying Agent
and Registrar. The Company may change any Paying Agent or Xxxxxxxxx
X0-0
without notice to any Holder. The Company or any of its Subsidiaries
may act in any such capacity.
(4) INDENTURE. The Company issued the Notes under an
Indenture dated as of January 18, 2005 (the "Indenture") among the
Company, the Guarantors and the Trustee. The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by
reference to the TIA. The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture
shall govern and be controlling. The Notes are unsecured obligations of
the Company. The Company will be entitled to issue Additional Notes
pursuant to Section 2.13 of the Indenture.
(5) OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Company will not have the option to redeem the Notes prior to January 15, 2008.
On or after January 15, 2008 and prior to maturity, the Company may, at its
option, redeem all or a part of the Notes at any time and from time to time upon
not less than 30 nor more than 90 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest and Liquidated Damages, if any, on the Notes redeemed to the
applicable redemption date, if redeemed during the twelve-month period beginning
on January 15, of the years indicated below, subject to the rights of Holders on
the relevant record date to receive interest on the relevant interest payment
date:
Year Percentage
---- ----------
2008........................................... 104.313%
2009........................................... 102.156%
2010 and thereafter............................ 100.000%
Unless the Company defaults in the payment of the redemption price,
interest will cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, at any time prior to January 15, 2008, the Company may on any one
or more occasions redeem up to 35% of the aggregate principal amount of Notes
issued under the Indenture at a redemption price equal to 108.625% of the
aggregate principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any to the redemption date, with the Net Cash Proceeds of
one or more Equity Offerings; provided that at least 65% in aggregate principal
amount of the Notes originally issued under the Indenture (excluding Notes held
by the Company and its Subsidiaries) remains outstanding immediately after the
occurrence of such redemption and that such redemption occurs within 60 days
after the date of the closing of such Equity Offering.
(6) MANDATORY REDEMPTION.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
(7) REPURCHASE AT THE OPTION OF HOLDER.
(a) If there is a Change of Control, each Holder will
have the right to require the Company to repurchase all or any
part (equal to $1,000 or an integral multiple of $1,000) of
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that Holder's Notes, pursuant to an offer that the Company
will make to all Holders at a purchase price in cash equal to
101% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date
of purchase, subject to the rights of Holders on the relevant
record date to receive interest due on the relevant interest
payment date. Subject to the exceptions in Section 4.15 of the
Indenture, within thirty days following any Change of Control,
the Company will mail a notice to each Holder with a copy to
the Trustee setting forth the procedures governing the Change
of Control Offer as required by the Indenture.
(b) If the Company or a Restricted Subsidiary of the
Company consummates any Asset Dispositions, within 15 days
after the periods specified in Section 4.10(a)(3)(A) and (B)
of the Indenture, after which Excess Proceeds exist, the
Company will commence an offer to all Holders of Notes and all
holders of other Indebtedness that is pari passu with the
Notes containing provisions similar to those set forth in the
Indenture with respect to offers to purchase or redeem at a
purchase price of 100% of the principal amount thereof, plus
accrued and unpaid interest to the Purchase Date, and
Liquidated Damages, if any, with the proceeds of sales of
assets (an "Asset Disposition Offer") pursuant to Section 3.09
of the Indenture to purchase the maximum principal amount of
Notes (including any Additional Notes) and such other pari
passu Indebtedness that may be purchased out of the Excess
Proceeds at an offer price in cash in an amount equal to 100%
of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date
of purchase, in accordance with the procedures set forth in
the Indenture. To the extent that the aggregate amount of
Notes (including any Additional Notes) and other pari passu
Indebtedness tendered pursuant to an Asset Disposition Offer
is less than the Excess Proceeds, the Company (or such
Restricted Subsidiary) may use such deficiency for any purpose
not otherwise prohibited by the Indenture. If the aggregate
principal amount of Notes and other pari passu Indebtedness
tendered into such Asset Disposition Offer exceeds the amount
of Excess Proceeds, the Trustee shall select the Notes and
such other pari passu Indebtedness to be purchased on a pro
rata basis.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed
at least 30 days but not more than 90 days before the redemption date
to each Holder whose Notes are to be redeemed at its registered
address. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes
held by a Holder are to be redeemed.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes
may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or permitted
by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption,
except for the unredeemed portion of any Note being redeemed in part.
Also, the Company need not exchange or register the transfer of any
Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the
corresponding Interest Payment Date.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note
may be treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions set forth in Section 9.02 of the Indenture, the Notes and
the Note Guarantees may be amended or supplemented with the consent of
the Holders of at least a majority in aggregate principal amount of the
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then outstanding Notes including Additional Notes, if any, voting as a
single class, and any existing Default or Event or Default or
compliance with any provision of the Indenture or the Notes or the Note
Guarantees may be waived with the consent of the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes
including Additional Notes, if any, voting as a single class. Without
the consent of any Holder of a Note, the Indenture or the Notes or the
Note Guarantees may be amended or supplemented to cure any ambiguity,
omission, defect or inconsistency; to provide for the assumption by a
successor corporation of the obligations of the Company under the
Indenture; to provide for uncertificated Notes in addition to or in
place of certificated notes; provided, however, that the uncertificated
Notes are issued in registered form for purposes of Section 163(f) of
the Code, or in a manner such that the uncertificated Notes are
described in Section 163(f)(2)(B) of the Code; to add Guarantees with
respect to the Notes, to secure the Notes, to add to the covenants of
the Company for the benefit of the Holders or to surrender any right or
power conferred upon the Company; to make any change that does not
adversely affect the rights of any Holder; to comply with any
requirement of the SEC in connection with the qualification of the
Indenture under the TIA; to conform the text of the Indenture, the Note
Guarantees or the Notes to any provision of the Description of Notes to
the extent that such provision in the Description of Notes was intended
to be a verbatim recitation of a provision of the Indenture, the Note
Guarantees or the Notes; or to provide for the issuance of Additional
Notes in accordance with the limitations set forth in the Indenture as
of the date of the Indenture.
(12) DEFAULTS AND REMEDIES. Events of Default include: (i) a
default in any payment of interest on, or Liquidated Damages, if any,
with respect to, any Note when due, continued for 30 days; (ii) a
default in the payment of principal of, or premium, if any, on any Note
when due at its Stated Maturity, upon optional redemption, upon
required repurchase, upon declaration or otherwise; (iii) the failure
by the Company or any of its Restricted Subsidiaries to comply with its
obligations under Article 5 of the Indenture; (iv) the failure by the
Company or any of its Restricted Subsidiaries to comply for 30 days
after written notice from the Trustee or the Holders of at least 25% in
principal amount of the outstanding Notes with any of its obligations
under Sections 4.07, 4.09, 4.10 or 4.15 of the Indenture, in each case,
other than a failure to purchase Notes; (v) the failure by the Company
or any of its Restricted Subsidiaries to comply with its other
agreements contained in the Notes or the Indenture for 60 days after
written notice from the Trustee or the Holders of at least 25% in
principal amount of the outstanding Notes; (vi) the failure by the
Company or any Significant Subsidiary to pay any Indebtedness within
any applicable grace period after final maturity or the acceleration of
any such Indebtedness by the holders thereof because of a default if
the total amount of such Indebtedness unpaid or accelerated exceeds $20
million; (vii) certain events of bankruptcy or insolvency with respect
to the Company or any of its Significant Subsidiaries specified in the
Indenture; (viii) the rendering of any judgment or decree for the
payment of money in an amount, net of any insurance or indemnity
payments actually received in respect thereof prior to or within 90
days from the entry thereof, or to be received in respect thereof in
the event any appeal thereof shall be unsuccessful, in excess of $20
million against the Company or a Significant Subsidiary that is not
discharged, bonded or insured by a third Person if either an
enforcement proceeding thereon is commenced, or such judgment or decree
remains outstanding for a period of 90 days and is not discharged,
waived or stayed; or (ix) the failure of any Guarantee of the Notes by
a Guarantor that is a Significant Subsidiary to be in full force,
except as contemplated by the terms thereof or of the Indenture, or the
denial in writing by any such Guarantor of its obligations under the
Indenture or any such Guarantee if such Default continues for 10 days.
If any Event of Default occurs and is continuing, the Trustee, by
notice to the Company, or the Holders of at least a majority in
aggregate principal amount of the then outstanding Notes, by notice to
the Company and the Trustee, may declare all the Notes to be due and
A1-5
payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or
insolvency set forth in the Indenture, all outstanding Notes will
become due and payable immediately without further action or notice.
Holders may not enforce the Indenture or the Notes except as provided
in the Indenture. Subject to certain limitations set forth in the
Indenture, Holders of at least a majority in aggregate principal amount
of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Trustee may withhold from Holders of the Notes
notice of any continuing Default or Event of Default (except a Default
or Event of Default relating to the payment of principal or interest or
premium or Liquidated Damages, if any,) if it determines that
withholding notice is in their interest. The Holders of at least a
majority in aggregate principal amount of the then outstanding Notes by
notice to the Trustee may, on behalf of the Holders of all of the
Notes, rescind an acceleration or waive any existing Default or Event
of Default and its consequences under the Indenture except a continuing
Default or Event of Default in the payment of interest or premium or
Liquidated Damages, if any, on, or the principal of, the Notes. The
Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture, and the Company is required,
upon becoming aware of any Default or Event of Default, to deliver to
the Trustee a statement specifying such Default or Event of Default, in
each case as provided in the Indenture.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.
(14) NO RECOURSE AGAINST OTHERS. No director, officer,
employee, incorporator or stockholder of the Company or any Guarantor,
as such, will have any liability for any obligations of the Company or
any Guarantor under the Notes, the Indenture, the Note Guarantees, or
for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note
waives and releases all such liability. The waiver and release are part
of the consideration for issuance of the Notes. The waiver may not be
effective to waive liabilities under the federal securities laws.
(15) AUTHENTICATION. This Note will not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(16) ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder 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).
(17) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES
AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to
Holders of Notes under the Indenture, Holders of Restricted Global
Notes and Restricted Definitive Notes will have all the rights set
forth in the Registration Rights Agreement dated as of January 18,
2005, among the Company, the Guarantors and the other parties named on
the signature pages thereof or, in the case of Additional Notes,
Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights
agreements, if any, among the Company and the other parties thereto,
relating to rights given by the Company to the purchasers of any
Additional Notes (collectively, the "Registration Rights Agreement").
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(18) CUSIP NUMBERS. Pursuant to a recommendation promulgated
by the Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the Notes, and the
Trustee may use CUSIP numbers in notices of redemption as a convenience
to Holders. No representation is made as to the accuracy of such
numbers either as printed on the Notes or as contained in any notice of
redemption, and reliance may be placed only on the other identification
numbers placed thereon.
(19) THE INDENTURE, THIS NOTE AND THE NOTE GUARANTEES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK,
INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE NEW YORK OBLIGATIONS
LAW.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
General Nutrition Centers, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Chief Legal Officer
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ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature: ______________________________
(Sign exactly as your name appears on
the face of this Note)
Signature Guarantee*: _________________________
----------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
--Section 4.10 --Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$_______________
Date: _______________
Your Signature: ______________________________
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No.: ______________________
Signature Guarantee*: _________________________
----------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A1-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE *
The following exchanges of a part of this Global Note for an interest
in another Global Note or for a Definitive Note, or exchanges of a part of
another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount
Amount of decrease of this Global Note Signature of
in Principal Amount Amount of increase in following such authorized officer
of Principal Amount of decrease of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- ------------------
----------
* This schedule should be included only if the Note is issued in global form.
A1-10
EXHIBIT A2
[Face of Regulation S Temporary Global Note]
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CUSIP/CINS __________
8-5/8% Senior Notes due 2011
No. ___ $__________
GENERAL NUTRITION CENTERS, INC.
promises to pay to ___________________ or registered assigns,
the principal sum of __________________________________________________________
DOLLARS on January 15, 2011.
Interest Payment Dates: January 15 and July 15
Record Dates: January 1 and July 1
Dated: ___________________
GENERAL NUTRITION CENTERS, INC.
By:
-------------------------------------------
Name:
Title:
This is one of the Notes referred to in the within-mentioned Indenture:
[TRUSTEE],
as Trustee
By:
------------------------------
Authorized Signatory
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A2-1
[Back of Regulation S Temporary Global Note]
8-5/8% Senior Notes due 2011
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR DEFINITIVE NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE HOLDER NOR THE
BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED
TO RECEIVE CASH PAYMENTS OF INTEREST HEREON. DURING THE PERIOD WHICH SUCH
HOLDER HOLDS THIS NOTE NOTHING IN THIS LEGEND SHALL BE DEEMED TO PREVENT
INTEREST FROM ACCRUING ON THE NOTE.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (2) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (4) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF GENERAL NUTRITION CENTERS, INC.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. 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 ITS 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 MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER
ENTITY AS MAY BE 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 INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH
RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES
A2-2
ACT, IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, (5) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (BASED UPON AN OPINION OF COUNSEL IF
GENERAL NUTRITION CENTERS, INC. SO REQUESTS) OR (6) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL
APPLICABLE BLUE SKY LAWS OF THE STATES OF THE UNITED STATES.
Capitalized terms used herein have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
(1) INTEREST. General Nutrition Centers, Inc., a Delaware
corporation (the "Company"), promises to pay interest on the principal
amount of this Note at 8-5/8% per annum from ________________, 20__
until maturity and shall pay the Liquidated Damages, if any, payable
pursuant to Section 5 of the Registration Rights Agreement referred to
below. The Company will pay interest and Liquidated Damages, if any,
semi-annually in arrears on January 15 and July 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day
(each, an "Interest Payment Date"). Interest on the Notes will accrue
from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of original issuance; provided
that if there is no existing Default in the payment of interest, and if
this Note is authenticated between a record date referred to on the
face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided
further that the first Interest Payment Date shall be _____________,
20__. The Company will pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at the rate that is then
in effect on the Notes to the extent lawful; it will pay interest
(including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest and Liquidated
Damages, if any, (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful. Interest
will be computed on the basis of a 360-day year of twelve 30-day
months.
Until this Regulation S Temporary Global Note is exchanged for one or
more Regulation S Permanent Global Notes, the Holder hereof shall not be
entitled to receive payments of interest hereon; until so exchanged in full,
this Regulation S Temporary Global Note shall in all other respects be
entitled to the same benefits as other Notes under the Indenture.
(2) METHOD OF PAYMENT. The Company will pay interest on the
Notes (except defaulted interest) and Liquidated Damages, if any, to
the Persons who are registered Holders of Notes at the close of
business on the January 1 or July 1, as the case may be, next preceding
the applicable Interest Payment Date, even if such Notes are canceled
after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to
defaulted interest. If a Holder has given wire instructions to the
Company, the Company will pay all principal, interest and premium and
Liquidated Damages, if any, on that Holder's Notes in accordance with
those instructions. All other payments on the Notes will be made 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 interest and Liquidated Damages, if any, may be made by check mailed
to the Holders at their addresses set forth in the register of Holders;
provided that payment by wire transfer of immediately available funds
to the accounts specified by the Depositary, or its nominee will be
required with respect to principal of and interest, premium and
Liquidated Damages, if any, on, all Global Notes. Such payment will be
A2-3
in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts.
(3) PAYING AGENT AND REGISTRAR. Initially, U.S. Bank National
Association, the Trustee under the Indenture, will act as Paying Agent
and Registrar. The Company may change any Paying Agent or Registrar
without notice to any Holder. The Company or any of its Subsidiaries
may act in any such capacity.
(4) INDENTURE. The Company issued the Notes under an
Indenture dated as of January 18, 2005 (the "Indenture") among the
Company, the Guarantors and the Trustee. The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by
reference to the TIA. The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of
such terms. To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture
shall govern and be controlling. The Notes are unsecured obligations of
the Company. The Company will be entitled to issue Additional Notes
pursuant to Section 2.13 of the Indenture.
(5) OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) of this Paragraph 5, the
Company will not have the option to redeem the Notes prior to January 15, 2008.
On or after January 15, 2008 and prior to maturity, the Company may, at its
option, redeem all or a part of the Notes at any time and from time to time upon
not less than 30 nor more than 90 days' notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest and Liquidated Damages, if any, on the Notes redeemed to the
applicable redemption date, if redeemed during the twelve-month period beginning
on January 15, of the years indicated below, subject to the rights of Holders on
the relevant record date to receive interest on the relevant interest payment
date:
Year Percentage
---- ----------
2008.............................................. 104.313%
2009.............................................. 102.156%
2010 and thereafter............................... 100.000%
Unless the Company defaults in the payment of the redemption price,
interest will cease to accrue on the Notes or portions thereof called for
redemption on the applicable redemption date.
(b) Notwithstanding the provisions of subparagraph (a) of this
Paragraph 5, at any time prior to January 15, 2008, the Company may on any one
or more occasions redeem up to 35% of the aggregate principal amount of Notes
issued under the Indenture at a redemption price equal to 108.625% of the
aggregate principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages, if any to the redemption date, with the Net Cash Proceeds of
one or more Equity Offerings; provided that at least 65% in aggregate principal
amount of the Notes originally issued under the Indenture (excluding Notes held
by the Company and its Subsidiaries) remains outstanding immediately after the
occurrence of such redemption and that such redemption occurs within 60 days
after the date of the closing of such Equity Offering.
(6) MANDATORY REDEMPTION.
The Company is not required to make mandatory redemption or sinking
fund payments with respect to the Notes.
A2-4
(7) REPURCHASE AT THE OPTION OF HOLDER.
(a) If there is a Change of Control, each Holder will
have the right to require the Company to repurchase all or any
part (equal to $1,000 or an integral multiple of $1,000) of
that Holder's Notes, pursuant to an offer that the Company
will make to all Holders at a purchase price in cash equal to
101% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date
of purchase, subject to the rights of Holders on the relevant
record date to receive interest due on the relevant interest
payment date. Subject to the exceptions in Section 4.15 of the
Indenture, within thirty days following any Change of Control,
the Company will mail a notice to each Holder with a copy to
the Trustee setting forth the procedures governing the Change
of Control Offer as required by the Indenture.
(b) If the Company or a Restricted Subsidiary of the
Company consummates any Asset Dispositions, within 15 days
after the periods specified in Section 4.10(a)(3)(A) and (B)
of the Indenture, after which Excess Proceeds exist, the
Company will commence an offer to all Holders of Notes and all
holders of other Indebtedness that is pari passu with the
Notes containing provisions similar to those set forth in the
Indenture with respect to offers to purchase or redeem at a
purchase price of 100% of the principal amount thereof, plus
accrued and unpaid interest to the Purchase Date, and
Liquidated Damages, if any, with the proceeds of sales of
assets (an "Asset Disposition Offer") pursuant to Section 3.09
of the Indenture to purchase the maximum principal amount of
Notes (including any Additional Notes) and such other pari
passu Indebtedness that may be purchased out of the Excess
Proceeds at an offer price in cash in an amount equal to 100%
of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, thereon to the date
of purchase, in accordance with the procedures set forth in
the Indenture. To the extent that the aggregate amount of
Notes (including any Additional Notes) and other pari passu
Indebtedness tendered pursuant to an Asset Disposition Offer
is less than the Excess Proceeds, the Company (or such
Restricted Subsidiary) may use such deficiency for any purpose
not otherwise prohibited by the Indenture. If the aggregate
principal amount of Notes and other pari passu Indebtedness
tendered into such Asset Disposition Offer exceeds the amount
of Excess Proceeds, the Trustee shall select the Notes and
such other pari passu Indebtedness to be purchased on a pro
rata basis.
(8) NOTICE OF REDEMPTION. Notice of redemption will be mailed
at least 30 days but not more than 90 days before the redemption date
to each Holder whose Notes are to be redeemed at its registered
address. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes
held by a Holder are to be redeemed.
(9) DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Notes may be registered and Notes
may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may
require a Holder to pay any taxes and fees required by law or permitted
by the Indenture. The Company need not exchange or register the
transfer of any Note or portion of a Note selected for redemption,
except for the unredeemed portion of any Note being redeemed in part.
Also, the Company need not exchange or register the transfer of any
Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the
corresponding Interest Payment Date.
This Regulation S Temporary Global Note is exchangeable in whole or
in part for one or more Global Notes only (i) on or after the termination of
the 40-day distribution compliance period (as defined in Regulation S) and
A2-5
(ii) upon presentation of certificates (accompanied by an Opinion of Counsel,
if applicable) required by Article 2 of the Indenture. Upon exchange of this
Regulation S Temporary Global Note for one or more Global Notes, the Trustee
shall cancel this Regulation S Temporary Global Note.
(10) PERSONS DEEMED OWNERS. The registered Holder of a Note
may be treated as its owner for all purposes.
(11) AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain
exceptions set forth in Section 9.02 of the Indenture, the Notes and
the Note Guarantees may be amended or supplemented with the consent of
the Holders of at least a majority in aggregate principal amount of the
then outstanding Notes including Additional Notes, if any, voting as a
single class, and any existing Default or Event or Default or
compliance with any provision of the Indenture or the Notes or the Note
Guarantees may be waived with the consent of the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes
including Additional Notes, if any, voting as a single class. Without
the consent of any Holder of a Note, the Indenture or the Notes or the
Note Guarantees may be amended or supplemented to cure any ambiguity,
omission, defect or inconsistency; to provide for the assumption by a
successor corporation of the obligations of the Company under the
Indenture; to provide for uncertificated Notes in addition to or in
place of certificated notes; provided, however, that the uncertificated
Notes are issued in registered form for purposes of Section 163(f) of
the Code, or in a manner such that the uncertificated Notes are
described in Section 163(f)(2)(B) of the Code; to add Guarantees with
respect to the Notes, to secure the Notes, to add to the covenants of
the Company for the benefit of the Holders or to surrender any right or
power conferred upon the Company; to make any change that does not
adversely affect the rights of any Holder; to comply with any
requirement of the SEC in connection with the qualification of the
Indenture under the TIA; to conform the text of the Indenture, the Note
Guarantees or the Notes to any provision of the Description of Notes to
the extent that such provision in the Description of Notes was intended
to be a verbatim recitation of a provision of the Indenture, the Note
Guarantees or the Notes; or to provide for the issuance of Additional
Notes in accordance with the limitations set forth in the Indenture as
of the date of the Indenture.
(12) DEFAULTS AND REMEDIES. Events of Default include: (i) a
default in any payment of interest on, or Liquidated Damages, if any,
with respect to, any Note when due, continued for 30 days; (ii) a
default in the payment of principal of, or premium, if any, on any Note
when due at its Stated Maturity, upon optional redemption, upon
required repurchase, upon declaration or otherwise; (iii) the failure
by the Company or any of its Restricted Subsidiaries to comply with its
obligations under Articles 5 of the Indenture; (iv) the failure by the
Company or any of its Restricted Subsidiaries to comply for 30 days
after written notice from the Trustee or the Holders of at least 25% in
principal amount of the outstanding Notes with any of its obligations
under Sections 4.07, 4.09, 4.10 or 4.15 of the Indenture, in each case,
other than a failure to purchase Notes; (v) the failure by the Company
or any of its Restricted Subsidiaries to comply with its other
agreements contained in the Notes or the Indenture for 60 days after
written notice from the Trustee or the Holders of at least 25% in
principal amount of the outstanding Notes; (vi) the failure by the
Company or any Significant Subsidiary to pay any Indebtedness within
any applicable grace period after final maturity or the acceleration of
any such Indebtedness by the holders thereof because of a default if
the total amount of such Indebtedness unpaid or accelerated exceeds $20
million; (vii) certain events of bankruptcy or insolvency with respect
to the Company or any of its Significant Subsidiaries specified in the
Indenture; (viii) the rendering of any judgment or decree for the
payment of money in an amount, net of any insurance or indemnity
A2-6
payments actually received in respect thereof prior to or within 90
days from the entry thereof, or to be received in respect thereof in
the event any appeal thereof shall be unsuccessful, in excess of $20
million against the Company or a Significant Subsidiary that is not
discharged, bonded or insured by a third Person if either an
enforcement proceeding thereon is commenced, or such judgment or decree
remains outstanding for a period of 90 days and is not discharged,
waived or stayed; or (ix) the failure of any Guarantee of the Notes by
a Guarantor that is a Significant Subsidiary to be in full force,
except as contemplated by the terms thereof or of the Indenture, or the
denial in writing by any such Guarantor of its obligations under the
Indenture or any such Guarantee if such Default continues for 10 days.
If any Event of Default occurs and is continuing, the Trustee, by
notice to the Company, or the Holders of at least a majority in
aggregate principal amount of the then outstanding Notes, by notice to
the Company and the Trustee, may declare all the Notes to be due and
payable immediately. Notwithstanding the foregoing, in the case of an
Event of Default arising from certain events of bankruptcy or
insolvency set forth in the Indenture, all outstanding Notes will
become due and payable immediately without further action or notice.
Holders may not enforce the Indenture or the Notes except as provided
in the Indenture. Subject to certain limitations set forth in the
Indenture, Holders of at least a majority in aggregate principal amount
of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power. The Trustee may withhold from Holders of the Notes
notice of any continuing Default or Event of Default (except a Default
or Event of Default relating to the payment of principal or interest or
premium or Liquidated Damages, if any,) if it determines that
withholding notice is in their interest. The Holders of at least a
majority in aggregate principal amount of the then outstanding Notes by
notice to the Trustee may, on behalf of the Holders of all of the
Notes, rescind an acceleration or waive any existing Default or Event
of Default and its consequences under the Indenture except a continuing
Default or Event of Default in the payment of interest or premium or
Liquidated Damages, if any, on, or the principal of, the Notes. The
Company is required to deliver to the Trustee annually a statement
regarding compliance with the Indenture, and the Company is required,
upon becoming aware of any Default or Event of Default, to deliver to
the Trustee a statement specifying such Default or Event of Default, in
each case as provided in the Indenture.
(13) TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
the Trustee.
(14) NO RECOURSE AGAINST OTHERS. No director, officer,
employee, incorporator or stockholder of the Company or any Guarantor,
as such, will have any liability for any obligations of the Company or
any Guarantor under the Notes, the Indenture, the Note Guarantees, or
for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note
waives and releases all such liability. The waiver and release are part
of the consideration for issuance of the Notes. The waiver may not be
effective to waive liabilities under the federal securities laws.
(15) AUTHENTICATION. This Note will not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
(16) ABBREVIATIONS. Customary abbreviations may be used in the
name of a Holder 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).
A2-7
(17) ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES
AND RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to
Holders of Notes under the Indenture, Holders of Restricted Global
Notes and Restricted Definitive Notes will have all the rights set
forth in the Registration Rights Agreement dated as of January 18,
2005, among the Company, the Guarantors and the other parties named on
the signature pages thereof or, in the case of Additional Notes,
Holders of Restricted Global Notes and Restricted Definitive Notes will
have the rights set forth in one or more registration rights
agreements, if any, among the Company and the other parties thereto,
relating to rights given by the Company to the purchasers of any
Additional Notes (collectively, the "Registration Rights Agreement").
(18) CUSIP NUMBERS. Pursuant to a recommendation promulgated
by the Committee on Uniform Security Identification Procedures, the
Company has caused CUSIP numbers to be printed on the Notes, and the
Trustee may use CUSIP numbers in notices of redemption as a convenience
to Holders. No representation is made as to the accuracy of such
numbers either as printed on the Notes or as contained in any notice of
redemption, and reliance may be placed only on the other identification
numbers placed thereon.
(19) THE INDENTURE, THIS NOTE AND THE NOTE GUARANTEES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK,
INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE NEW YORK OBLIGATIONS
LAW.
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
General Nutrition Centers, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Chief Legal Officer
A2-8
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to: __________________________________
(Insert assignee's legal name)
________________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________________________
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date: _______________
Your Signature: ______________________________
(Sign exactly as your name appears on
the face of this Note)
Signature Guarantee*: _________________________
----------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A2-9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.10 or 4.15 of the Indenture, check the appropriate box
below:
--Section 4.10 --Section 4.15
If you want to elect to have only part of the Note purchased by the
Company pursuant to Section 4.10 or Section 4.15 of the Indenture, state the
amount you elect to have purchased:
$_______________
Date: _______________
Your Signature: ______________________________
(Sign exactly as your name appears on
the face of this Note)
Tax Identification No.: ______________________
Signature Guarantee*: _________________________
----------
* Participant in a recognized Signature Guarantee Medallion Program (or other
signature guarantor acceptable to the Trustee).
A2-10
SCHEDULE OF EXCHANGES OF INTERESTS IN THE REGULATION S TEMPORARY GLOBAL NOTE
The following exchanges of a part of this Regulation S Temporary
Global Note for an interest in another Global Note, or exchanges of a part of
another other Restricted Global Note for an interest in this Regulation S
Temporary Global Note, have been made:
Principal Amount
Amount of decrease of this Global Note Signature of
in Principal Amount Amount of increase in following such authorized officer
of Principal Amount of decrease of Trustee or
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- ------------------- --------------------- ------------------- ------------------
A2-11
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
General Nutrition Centers, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
U.S. Bank National Association
00 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, XX 00000-0000
Re: 8-5/8% Senior Notes due 2011
Reference is hereby made to the Indenture, dated as of January 18,
2005 (the "Indenture"), among General Nutrition Centers, Inc., as issuer (the
"Company"), the Guarantors party thereto and U.S. Bank National Association,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
___________________, (the "Transferor") owns and proposes to transfer
the Note[s] or interest in such Note[s] specified in Annex A hereto, in the
principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE 144A GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO
RULE 144A. The Transfer is being effected pursuant to and in accordance with
Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believes is purchasing the beneficial interest or Definitive Note for
its own account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A, and such Transfer is in compliance with
any applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the 144A Global Note and/or the Restricted Definitive Note and
in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE REGULATION S TEMPORARY GLOBAL NOTE, THE REGULATION S PERMANENT
GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE PURSUANT TO REGULATION S. The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and, accordingly, the Transferor hereby further
certifies that (i) the Transfer is not being made to a Person in the United
States and (x) at the time the buy order was originated, the Transferee was
outside the United States or such Transferor and any Person acting on its behalf
reasonably believed and believes that the Transferee was outside the United
States or (y) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither such Transferor nor any Person
acting on its behalf knows that the transaction was prearranged with a buyer in
the United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S
under the Securities Act, (iii) the transaction is not part of a plan or scheme
to evade the registration requirements of the Securities Act and (iv) if the
B-1
proposed transfer is being made prior to the expiration of the Restricted
Period, the transfer is not being made to a U.S. Person or for the account or
benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of
the proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Permanent Global Note, the Regulation S Temporary Global Note
and/or the Restricted Definitive Note and in the Indenture and the Securities
Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI GLOBAL NOTE OR A RESTRICTED DEFINITIVE NOTE
PURSUANT TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR
REGULATION S. The Transfer is being effected in compliance with the transfer
restrictions applicable to beneficial interests in Restricted Global Notes and
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of the
United States, and accordingly the Transferor hereby further certifies that
(check one):
(a) [ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144, Rule
903 or Rule 904, and the Transferor hereby further certifies that it
has not engaged in any general solicitation within the meaning of
Regulation D under the Securities Act and the Transfer complies with
the transfer restrictions applicable to beneficial interests in a
Restricted Global Note or Restricted Definitive Notes and the
requirements of the exemption claimed, which certification is supported
by (1) a certificate executed by the Transferee in the form of Exhibit
D to the Indenture and (2) an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor has
attached to this certification), to the effect that such Transfer is in
compliance with the Securities Act. Upon consummation of the proposed
transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend
printed on the IAI Global Note and/or the Restricted Definitive Notes
and in the Indenture and the Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any state of the
B-2
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will no longer be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Global Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Notes, on Restricted Definitive Notes and in the
Indenture.
(c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule 144,
Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
State of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Indenture, the transferred
beneficial interest or Definitive Note will not be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the
Restricted Global Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
___________________________________
[Insert Name of Transferor]
By: _______________________________
Name:
Title:
Dated: _______________________
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(A) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Permanent Global Note (CUSIP
_________), or
(iii) [ ] Regulation S Temporary Global Note (CUSIP
_________); or
(iv) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Permanent Global Note (CUSIP
_________), or
(iii) [ ] Regulation S Temporary Global Note (CUSIP
_________); or
(iv) [ ] IAI Global Note (CUSIP _________); or
(v) [ ] Unrestricted Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
General Nutrition Centers, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
U.S. Bank National Association
00 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, XX 00000-0000
Re: 8-5/8% Senior Notes due 2011
(CUSIP ____________)
Reference is hereby made to the Indenture, dated as of January 18,
2005 (the "Indenture"), among General Nutrition Centers, Inc., as issuer (the
"Company"), the Guarantors party thereto and U.S. Bank National Association,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
__________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the
"Exchange"). In connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN
A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a
Restricted Global Note for a beneficial interest in an Unrestricted Global
Note in an equal principal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Global Notes and pursuant to and in accordance
with the Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any
state of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the Exchange
of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive
Note is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Global Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Definitive Note is
being acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
C-1
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in
an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest
is being acquired in compliance with any applicable blue sky securities laws
of any state of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act,
(iii) the restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Definitive Note is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS IN
RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the Exchange of
the Owner's beneficial interest in a Restricted Global Note for a Restricted
Definitive Note with an equal principal amount, the Owner hereby certifies
that the Restricted Definitive Note is being acquired for the Owner's own
account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Definitive Note and
in the Indenture and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial interest
in the [CHECK ONE] 144A Global Note, Regulation S Global Note, IAI Global Note
with an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer and
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Notes and pursuant to and in
accordance with the Securities Act, and in compliance with any applicable blue
sky securities laws of any state of the United States. Upon consummation of
the proposed Exchange in accordance with the terms of the Indenture, the
beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the relevant Restricted
Global Note and in the Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
___________________________________
[Insert Name of Transferor]
By: _______________________________
Name:
Title:
Dated: _______________________
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
General Nutrition Centers, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
U.S. Bank National Association
00 Xxxxxxxxxx Xxxxxx
Xx. Xxxx, XX 00000-0000
Re: 8-5/8% Senior Notes due 2011
Reference is hereby made to the Indenture, dated as of January 18,
2005 (the "Indenture"), among General Nutrition Centers, Inc., as issuer (the
"Company"), the guarantors party thereto and U.S. Bank National Association,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the Securities Act of
1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which
we are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer,
furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and
to the Company a signed letter substantially in the form of this letter and an
Opinion of Counsel in form reasonably acceptable to the Company to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any Person purchasing the Definitive Note
or beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising
such purchaser that resales thereof are restricted as stated herein.
D-1
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and
the Company may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that the Notes
purchased by us will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment.
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise
sole investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby.
___________________________________
[Insert Name of Transferor]
By: _______________________________
Name:
Title:
Dated: _______________________
D-2
EXHIBIT E
[FORM OF NOTATION OF GUARANTEE]
For value received, each Guarantor (which term includes any successor
Person under the Indenture) has, jointly and severally, unconditionally
guaranteed, to the extent set forth in the Indenture and subject to the
provisions in the Indenture dated as of January 18, 2005 (the "Indenture")
among General Nutrition Centers, Inc., (the "Company"), the Guarantors party
thereto and U.S. Bank National Association, as trustee (the "Trustee"), (a)
the due and punctual payment of the principal of, premium and Liquidated
Damages, if any, and interest on, the Notes, whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of
interest on overdue principal of and interest on the Notes, if any, if lawful,
and the due and punctual performance of all other obligations of the Company
to the Holders or the Trustee all in accordance with the terms of the
Indenture and (b) in case of any extension of time of payment or renewal of
any Notes or any of such other obligations, that the same will be promptly
paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or
otherwise. The obligations of the Guarantors to the Holders of Notes and to
the Trustee pursuant to the Note Guarantee and the Indenture are expressly set
forth in Article 10 of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Note Guarantee.
Capitalized terms used but not defined herein have the meanings given
to them in the Indenture.
[Signatures on following pages]
E-1
[NAME OF GUARANTOR(S)]
By: _______________________________
Name:
Title:
E-2
EXHIBIT F
[FORM OF SUPPLEMENTAL INDENTURE
TO BE DELIVERED BY SUBSEQUENT GUARANTORS]
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
________________, 20__, among __________________ (the "Guaranteeing
Subsidiary"), a subsidiary of General Nutrition Centers, Inc. (or its
permitted successor), a Delaware corporation (the "Company"), the Company, the
other Guarantors (as defined in the Indenture referred to herein) and U.S.
Bank National Association, as trustee under the Indenture referred to below
(the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of January 18, 2005 providing
for the issuance of 8-5/8% Senior Notes due 2011 (the "Notes");
WHEREAS, the Indenture provides that under certain circumstances the
Guaranteeing Subsidiary shall execute and deliver to the Trustee a
supplemental indenture pursuant to which the Guaranteeing Subsidiary shall
unconditionally guarantee all of the Company's Obligations under the Notes and
the Indenture on the terms and conditions set forth herein (the "Note
Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture.
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the
Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the
equal and ratable benefit of the Holders of the Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees
to provide an unconditional Guarantee on the terms and subject to the
conditions set forth in the Note Guarantee and in the Indenture including but
not limited to Article 10 thereof.
4. NO RECOURSE AGAINST OTHERS. No director, officer, employee,
incorporator or stockholder of the Company or any Guarantor, as such, will
have any liability for any obligations of the Company or any Guarantor under
the Notes, the Indenture, the Note Guarantees, or for any claim based on, in
respect of, or by reason of, such obligations or their creation. Each Holder
of Notes by accepting a Note waives and releases all such liability. The
waiver and release are part of the consideration for issuance of the Notes.
The waiver may not be effective to waive liabilities under the federal
securities laws.
5. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF NEW YORK, INCLUDING WITHOUT LIMITATION SECTION
5-1401 OF THE NEW YORK OBLIGATIONS LAW.
6. COUNTERPARTS. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
F-1
7. EFFECT OF HEADINGS. The Section headings herein are for
convenience only and shall not affect the construction hereof.
8. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained herein,
all of which recitals are made solely by the Guaranteeing Subsidiary and the
Company.
F-2
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first above
written.
Dated: _______________, 20___
[GUARANTEEING SUBSIDIARY]
By: _______________________________
Name:
Title:
[COMPANY]
By: _______________________________
Name:
Title:
[EXISTING GUARANTORS]
By: _______________________________
Name:
Title:
[TRUSTEE],
as Trustee
By: _______________________________
Authorized Signatory
F-3
