EXHIBIT 99.2
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EXECUTION COPY
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INDENTURE
Dated as of March 8, 0000
Xxxxx
XXXXXXX XXXXX XXXXXXX, INC., as Issuer,
and
THE GUARANTORS NAMED HEREIN
and
U.S. BANK NATIONAL ASSOCIATION, as Trustee
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$155,000,000
9 7/8% Senior Notes Due 2014
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[[NYCORP:2359186v5:4202D:03/05/04--01:03 p]]
[[NYCORP:2359186v5:4202D:03/05/04--01:03 p]]
CROSS-REFERENCE TABLE
Trust Indenture Indenture
Act Section Section
--------------- ---------
ss. 310(a)(1)................................................. 7.10
(a)(2).................................................. 7.10
(a)(3).................................................. N.A.
(a)(4).................................................. N.A.
(a)(5).................................................. 7.08, 7.10
(b)..................................................... 7.08; 7.10; 11.02
(c)..................................................... N.A.
ss. 311(a).................................................... 7.11
(b)..................................................... 7.11
(c)..................................................... N.A.
ss. 312(a).................................................... 2.05
(b)..................................................... 11.03
(c)..................................................... 11.03
ss. 313(a).................................................... 7.06
(b)(1).................................................. 7.06
(b)(2).................................................. 7.06
(c)..................................................... 7.06; 11.02
(d)..................................................... 7.06
ss. 314(a).................................................... 4.11; 4.12; 11.02
(b)..................................................... N.A.
(c)(1).................................................. 11.04
(c)(2).................................................. 11.04
(c)(3).................................................. N.A.
(d)..................................................... N.A.
(e)..................................................... 11.05
(f)..................................................... N.A.
ss. 315(a).................................................... 7.01(b)
(b)..................................................... 7.05; 11.02
(c)..................................................... 7.01(a)
(d)..................................................... 7.01(c)
(e)..................................................... 6.11
ss. 316(a)(last sentence)..................................... 2.09
(a)(1)(A)............................................... 6.05
(a)(1)(B)............................................... 6.04
(a)(2).................................................. N.A.
(b)..................................................... 6.07
(c)..................................................... 9.04
ss. 317(a)(1)................................................. 6.08
(a)(2).................................................. 6.09
(b)..................................................... 2.04
ss. 318(a).................................................... 11.01
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N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to
be a part of the Indenture
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.....................................................1
SECTION 1.02. Incorporation by Reference of Trust Indenture Act..............14
SECTION 1.03. Rules of Construction..........................................14
ARTICLE II
THE SECURITIES
SECTION 2.01. Form and Dating................................................15
SECTION 2.02. Execution and Authentication...................................15
SECTION 2.03. Registrar and Paying Agent.....................................16
SECTION 2.04. Paying Agent to Hold Assets in Trust...........................16
SECTION 2.05. Securityholder Lists...........................................16
SECTION 2.06. Transfer and Exchange..........................................16
SECTION 2.07. Replacement Securities.........................................17
SECTION 2.08. Outstanding Securities.........................................17
SECTION 2.09. Treasury Securities............................................17
SECTION 2.10. Temporary Securities...........................................17
SECTION 2.11. Cancellation...................................................18
SECTION 2.12. Defaulted Interest.............................................18
SECTION 2.13. CUSIP Numbers..................................................18
SECTION 2.14. Deposit of Moneys..............................................18
SECTION 2.15. Issuance of Additional Securities..............................18
ARTICLE III
REDEMPTION
SECTION 3.01. Notices to Trustee.............................................19
SECTION 3.02. Selection of Securities to Be Redeemed.........................19
SECTION 3.03. Notice of Redemption...........................................19
SECTION 3.04. Effect of Notice of Redemption.................................20
SECTION 3.05. Deposit of Redemption Price....................................20
SECTION 3.06. Securities Redeemed in Part....................................20
ARTICLE IV
COVENANTS
SECTION 4.01. Payment of Securities..........................................20
SECTION 4.02. Maintenance of Office or Agency................................21
SECTION 4.03. Transactions with Affiliates...................................21
SECTION 4.04. Limitation on Incurrence of Indebtedness.......................22
SECTION 4.05. Limitation on Certain Asset Sales..............................22
SECTION 4.06. Limitation on Restricted Payments..............................25
SECTION 4.07. Corporate Existence............................................28
SECTION 4.08. Payment of Taxes and Other Claims..............................28
SECTION 4.09. Notice of Defaults.............................................28
SECTION 4.10. Maintenance of Properties and Insurance........................28
SECTION 4.11. Compliance Certificate.........................................29
SECTION 4.12. Provision of Financial Information.............................29
SECTION 4.13. Waiver of Stay, Extension or Usury Laws........................29
SECTION 4.14. Change of Control..............................................29
SECTION 4.15. Limitations on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries.................31
SECTION 4.16. Designation of Restricted and Non-Restricted Subsidiaries......32
SECTION 4.17. Limitation on Liens............................................32
SECTION 4.18. Limitation on Sale and Leaseback Transactions..................33
SECTION 4.19. Future Guarantors..............................................33
ARTICLE V
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidation and Sale of Assets......................33
SECTION 5.02. Successor Corporation Substituted..............................34
ARTICLE VI
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default..............................................34
SECTION 6.02. Acceleration...................................................36
SECTION 6.03. Other Remedies.................................................36
SECTION 6.04. Waiver of Past Default.........................................36
SECTION 6.05. Control by Majority............................................37
SECTION 6.06. Limitation on Suits............................................37
SECTION 6.07. Rights of Holders to Receive Payment...........................37
SECTION 6.08. Collection Suit by Trustee.....................................37
SECTION 6.09. Trustee May File Proofs of Claim...............................38
SECTION 6.10. Priorities.....................................................38
SECTION 6.11. Undertaking for Costs..........................................38
ARTICLE VII
TRUSTEE
SECTION 7.01. Duties of Trustee..............................................39
SECTION 7.02. Rights of Trustee..............................................40
SECTION 7.03. Individual Rights of Trustee...................................40
SECTION 7.04. Trustee's Disclaimer...........................................41
SECTION 7.05. Notice of Defaults.............................................41
SECTION 7.06. Reports by Trustee to Holders..................................41
SECTION 7.07. Compensation and Indemnity.....................................41
SECTION 7.08. Replacement of Trustee.........................................42
SECTION 7.09. Successor Trustee by Merger, etc...............................43
SECTION 7.10. Eligibility; Disqualification..................................43
SECTION 7.11. Preferential Collection of Claims Against Company..............43
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Indenture.........................................43
SECTION 8.02. Legal Defeasance...............................................44
SECTION 8.03. Covenant Defeasance............................................44
SECTION 8.04. Conditions to Legal Defeasance or Covenant Defeasance..........44
SECTION 8.05. Deposited Money and U.S. Government Obligations to
Be Held in Trust; Other Miscellaneous Provisions...............46
SECTION 8.06. Reinstatement..................................................46
SECTION 8.07. Moneys Held by Paying Agent....................................47
SECTION 8.08. Moneys Held by Trustee.........................................47
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.....................................47
SECTION 9.02. With Consent of Holders........................................48
SECTION 9.03. Compliance with Trust Indenture Act............................49
SECTION 9.04. Revocation and Effect of Consents..............................49
SECTION 9.05. Notation on or Exchange of Securities..........................49
SECTION 9.06. Trustee to Sign Amendments, etc................................49
ARTICLE X
GUARANTEES
SECTION 10.01. Unconditional Guarantees......................................49
SECTION 10.02. Severability..................................................50
SECTION 10.03. Limitation of Guarantors' Liability...........................50
SECTION 10.04. Subordination of Subrogation and Other Rights.................50
SECTION 10.05. Delivery of Guarantees........................................51
SECTION 10.06. Release of Subsidiary Guarantor...............................51
SECTION 10.07. Contribution..................................................51
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls..................................51
SECTION 11.02. Notices.......................................................52
SECTION 11.03. Communications by Holders with Other Holders..................52
SECTION 11.04. Certificate and Opinion as to Conditions Precedent............53
SECTION 11.05. Statements Required in Certificate or Opinion.................53
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar.....................53
SECTION 11.07. Governing Law.................................................53
SECTION 11.08. No Recourse Against Others....................................53
SECTION 11.09. Successors....................................................53
SECTION 11.10. Counterpart Originals.........................................54
SECTION 11.11. Severability..................................................54
SECTION 11.12. No Adverse Interpretation of Other Agreements.................54
SECTION 11.13. Legal Holidays................................................54
Rule 144A/Regulation S/IAI Appendix
EXHIBIT 1 - Form of Initial Security
EXHIBIT 2 - Form of Exchange Security or Private Exchange Security
EXHIBIT 3 - Form of Transferee Letter of Representation
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NOTE: This Table of Contents shall not, for any purpose, be deemed a part
of the Indenture.
INDENTURE dated as of March 8, 2004, among
FEDDERS NORTH AMERICA, INC., a Delaware corporation
(the "Company"), the GUARANTORS listed on the
signature pages hereto and U.S. BANK NATIONAL
ASSOCIATION, a national banking association, as
trustee (the "Trustee").
Each party hereto agrees as follows for the benefit of the
other parties and for the equal and ratable benefit of the Holders of the
Company's Initial Securities, Exchange Securities and Private Exchange
Securities (collectively, the "Securities"):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acceleration Notice" see Section 6.02.
"Additional Securities" means, subject to the Company's
compliance with Section 4.04, 97/8% Senior Notes Due 2014 issued from time to
time after March 8, 2004 under the terms of this Indenture (other than those
issued pursuant to Section 2.06, 2.07, 2.10, 3.06, 4.05, 4.14 or 9.05 of this
Indenture).
"Affiliate" means any of the following: (i) any Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company, (ii) any spouse, immediate family
member or other relative who has the same principal residence as any Person
described in clause (i) above, (iii) any trust in which any such Person
described in clause (i) or (ii) above has a beneficial interest, and (iv) any
corporation or other organization of which any such Person described above
collectively owns 10% or more of the equity of such entity.
"Affiliate Transaction" see Section 4.03.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Asset Sale" means the sale, lease, conveyance or other
disposition by the Company or a Restricted Subsidiary, or by Fedders
Corporation or any Non-FNA Subsidiary, in a single transaction or in a series
of related transactions, including any disposition by means of a merger,
consolidation or similar transaction of (1) any share of Capital Stock of a
Subsidiary (other than directors' qualifying shares or shares required by
applicable law to be held by a Person other than the Company or a Restricted
Subsidiary, or Fedders Corporation or a Non-FNA Subsidiary, as the case may
be); (2) all or substantially all the assets of any division or line of
business of the Company or any Restricted Subsidiary, or Fedders Corporation
or a Non-FNA Subsidiary, as the case may be; (3) any other assets of the
Company or any Restricted Subsidiary, or Fedders Corporation or a Non-FNA
Subsidiary, as the case may be, outside the ordinary course of business of
such Person; provided that Asset Sales will not include such sales, leases,
conveyances or dispositions in connection with (i) the surrender or waiver of
contract rights or the settlement, release or surrender of contract, tort or
other claims of any kind; (ii) the sale of inventory in the ordinary course of
business; (iii) a sale-leaseback of assets within one year following the
acquisition of such assets; (iv) the grant of any license of patents,
trademarks, registration therefor and other similar intellectual property; (v)
a transfer of assets by the Company or a Restricted Subsidiary to the Company
or a Restricted Subsidiary; (vi) the designation of a Restricted Subsidiary as
a Non-Restricted Subsidiary pursuant to Section 4.16; (vii) the sale, lease,
conveyance or other disposition of all or substantially all of the assets of
Fedders Corporation or the Company as permitted under Section 5.01; (viii) the
sale or disposition of obsolete equipment or other obsolete assets; (ix)
Restricted Payments permitted by Section 4.06; (x) the exchange of assets for
other non-cash assets that (a) are useful in the business of Fedders
Corporation and its Subsidiaries and (b) have a fair market value at least
equal to the fair market value of the assets being exchanged (as determined in
good faith by the Board of Directors of Fedders Corporation or the board of
directors of the Subsidiary of Fedders Corporation which owns such assets);
(xi) a transfer of assets by Fedders Corporation or a Subsidiary of Fedders
Corporation (other than the Company and its Restricted Subsidiaries) to
Fedders Corporation or a Subsidiary of Fedders Corporation (other than the
Company and its Restricted Subsidiaries); or (xii) the disposition of Rotorex
Company, Inc.'s property at Walkersville, Maryland, provided that the Net
Available Cash therefrom is used to make a Restricted Payment of the type
described in clause (ix) of the second paragraph under Section 4.06.
"Asset Sale Disposition Date" see Section 4.05.
"Asset Sale Offer " see Section 4.05.
"Asset Sale Purchase Date" see Section 4.05.
"Asset Sale Trigger Date" see Section 4.05.
"Attributable Debt" in respect of a sale and leaseback
transaction means, at the time of determination, the present value (discounted
at the rate of interest implicit in such transaction, determined in accordance
with GAAP) of the obligation of the lessee for net rental payments during the
remaining term of the lease included in such sale and leaseback transaction
(including any period for which such lease has been extended or may, at the
option of the lessor, be extended).
"Bankruptcy Law" see Section 6.01.
"Board of Directors" means the Company's board of directors
or any authorized committee of such board of directors.
"Business Day" means a day (other than a Saturday or Sunday)
on which the Depositary and banks in New York, and banks in the city in which
the Corporate Trust Office of the Trustee is located, are open for business.
"Capital Stock" means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock,
including any Preferred Stock.
"Cash Flow" means, for any given period and Person, the sum
of, without duplication, Consolidated Net Income, plus (a) any provision for
taxes based on income or profits to the extent such income or profits were
included in computing Consolidated Net Income, plus (b) Consolidated Interest
Expense, to the extent deducted in computing Consolidated Net Income, plus (c)
the amortization of all intangible assets, to the extent such amortization was
deducted in computing Consolidated Net Income (including, but not limited to,
inventory write-ups, goodwill, debt and financing costs), plus (d) all
depreciation and all other non-cash charges (including, without limitation,
those charges relating to purchase accounting adjustments and LIFO
adjustments), to the extent deducted in computing Consolidated Net Income,
plus (e) any interest income, to the extent such income was not included in
computing Consolidated Net Income, plus (f) all dividend payments on Preferred
Stock (whether or not paid in cash) to the extent deducted in computing
Consolidated Net Income; provided, however, that, if any such calculation
includes any period during which an acquisition or sale of a Person or the
incurrence or repayment of Indebtedness occurred, then such calculation for
such period shall be made on a Pro Forma Basis.
"Cash Flow Coverage Ratio" means, for any given period and
Person, the ratio of: (i) Cash Flow, divided by (ii) the sum of Consolidated
Interest Expense (except dividends paid or payable in additional shares of
Capital Stock (other than Disqualified Stock)) in each case, without
duplication; provided, however, that if any such calculation includes any
period during which an acquisition or sale of a Person or the incurrence or
repayment of Indebtedness occurred, then such calculation for such period
shall be made on a Pro Forma Basis.
"Change of Control" means the occurrence of any of the
following: (i) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act), excluding the Permitted Holders, is or
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 securities that such person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time), directly or indirectly, of more than 50% of the total Voting Stock of
the Company or of Fedders Corporation; or (ii) the Company or Fedders
Corporation consolidates with, or merges with or into, another person or
sells, assigns, conveys, transfers, leases or otherwise disposes of all or
substantially all of its assets to any person, or any person consolidates
with, or merges with or into, the Company or Fedders Corporation, in any such
event pursuant to a transaction in which the outstanding Voting Stock of the
Company or of Fedders Corporation is converted into or exchanged for cash,
securities or other property, other than any such transaction where (A) the
outstanding Voting Stock of the Company or of Fedders Corporation is converted
into or exchanged for (1) Voting Stock (other than Disqualified Stock) of the
surviving or transferee corporation or (2) cash, securities and other property
in an amount which could be paid by the Company as a Restricted Payment under
the Indenture and (B) immediately after such transaction no "person" or
"group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange
Act), excluding the Permitted Holders, is 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 securities that such person has
the right to acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of more than 50% of the
total Voting Stock of the surviving or transferee corporation; or (iii) during
any consecutive two-year period, individuals who at the beginning of such
period constituted the Board of Directors or the board of directors of Fedders
Corporation (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 then still in office who
are entitled to vote to elect such new director and were either directors at
the beginning of such period or persons whose election as directors or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors or the board of directors of
Fedders Corporation then in office.
"Change of Control Offer" see Section 4.14.
"Change of Control Purchase Date" see Section 4.14.
"Change of Control Trigger Date" see Section 4.14.
"Commission" means the Securities and Exchange Commission.
"Company" means the Person named as the "Company" in the
first paragraph of this Indenture until a successor shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
Vice Chairman of the Board, its President, a Vice President or its Treasurer,
and by an Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.
"Consolidated Interest Expense" means, for any given period
and Person, the aggregate of (i) the interest expense in respect of all
Indebtedness of such Person and the Restricted Subsidiaries for such period,
on a consolidated basis, determined in accordance with GAAP (including
amortization of original issue discount on any such Indebtedness, all non-cash
interest payments, the interest portion of any deferred payment obligation and
the interest component of capital lease obligations, but excluding
amortization of deferred financing fees if such amortization would otherwise
be included in interest expense) and (ii) the product of (a) all cash dividend
payments (and non-cash dividend payments in the case of a Person that is a
Restricted Subsidiary) on any series of Preferred Stock of such Person and the
Restricted Subsidiaries payable to a party other than the Company or a wholly
owned Subsidiary, times (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, on a
consolidated basis and in accordance with GAAP; provided, however, that for
the purpose of the Cash Flow Coverage Ratio, Consolidated Interest Expense
shall be calculated on a Pro Forma Basis.
"Consolidated Net Income" means, for any given period and
Person, the aggregate of the Net Income of such Person and the Restricted
Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided, however, that: (i) the Net Income of any
Person acquired in a pooling of interests transaction for any period prior to
the date of such acquisition shall be excluded, (ii) the Net Income (but not
loss) of any Person that is not a Restricted Subsidiary or that is accounted
for by the equity method of accounting shall be included only to the extent of
the amount of dividends or distributions paid in cash to the referent Person,
(iii) the Net Income of any Restricted Subsidiary shall be excluded to the
extent that the declaration or payment of dividends or similar distributions
by that Restricted Subsidiary of that Net Income is not at the date of
determination permitted without any prior governmental approval (which has not
been obtained) or, directly or indirectly, by operation of the terms of its
charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to that Restricted Subsidiary or its
stockholders, (iv) the cumulative effect of a change in accounting principles
shall be excluded, (v) income or loss attributable to discontinued operations
shall be excluded, (vi) all other extraordinary, unusual or nonrecurring gains
or losses shall be excluded, (vii) non-cash gains and losses from foreign
currency translation shall be excluded, (viii) any write down or write off of
intangible assets pursuant to the operation of SFAS 142 shall be excluded,
(ix) the Net Income (loss) of NYCOR North America, Inc. and its Subsidiaries
for periods prior to January 1, 2004 shall be excluded and (x) any expenses or
charges related to the offering of the Securities, including the writeoff of
deferred financing costs, the payment of redemption or other premiums and any
other loss on the early extinguishment of Indebtedness shall be excluded;
provided, however, that for purposes of determining the Cash Flow Coverage
Ratio, Consolidated Net Income shall be calculated on a Pro Forma Basis. For
the avoidance of doubt, for purposes of calculating Consolidated Net Income as
required by the definition of "Disqualified Distribution," no Non-FNA
Subsidiary or any Subsidiary of a Non-FNA Subsidiary shall be deemed to be a
Restricted Subsidiary.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 11.02 or such other address as the
Trustee may give notice to the Company.
"Covenant Defeasance Option" see Section 8.02.
"Credit Agreement" means collectively, the Accounts
Financing Agreement between Columbia Specialties, Inc. and Congress Financial
Corporation dated December 23, 1992, and the Accounts Financing Agreement by
and among Fedders North America, Inc., Xxxxxxx Quiet Kool Corporation and
Congress Financial Corporation dated December 23, 1992, together with all loan
documents and instruments thereunder (including, without limitation, any
guarantee agreements, covenant supplements and security documents), in each
case as such agreements have been or may be amended (including any amendment
and restatement thereof), supplemented or otherwise modified from time to
time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including, without limitation,
increasing the amount of available borrowings thereunder, and all Obligations
with respect thereto, in each case, to the extent permitted by Section 4.04 or
adding Subsidiaries of the Company as additional borrowers or guarantors
thereunder) all or any portion of the Indebtedness under such agreement or any
successor or replacement agreement and whether by the same or any other agent,
lender or group of lenders.
"Credit Facilities" means one or more debt facilities,
including the Credit Agreement, or commercial paper facilities with banks and
other institutional lenders or investors or indentures providing for revolving
credit loans, term loans, receivables financing, including through the sale of
receivables to such lenders or to special purpose entities formed to borrow
from such lenders against receivables, letters of credit or other long-term
indebtedness, in each case, as amended, restated, modified, renewed, refunded,
replaced or refinanced (including, without limitation, increasing the amount
of available borrowings, and all Obligations with respect thereto, in each
case, to the extent permitted by Section 4.04 or adding Restricted
Subsidiaries or Subsidiaries of the Company as additional borrowers or
guarantors thereunder), in whole or in part from time to time.
"Custodian" see Section 6.01.
"Default" means any event that is, or after notice or
passage of time or both would be, an Event of Default.
"defeasance trust" see Section 8.04.
"Depositary" means, with respect to the Securities 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 Securities, until a
successor shall have been appointed and become such Depositary pursuant to the
applicable provision of this Indenture, and, thereafter, "Depositary" shall
mean or include such successor.
"Disposition" see Section 5.01.
"Disqualified Distribution" means a cash dividend,
distribution or advance received by Fedders Corporation from any Non-FNA
Subsidiary to the extent the amount of such cash dividend, distribution or
advance and all other such cash dividends, distributions and advances since
the Issue Date would exceed the aggregate Consolidated Net Income of the
Non-FNA Subsidiaries accrued during the period (treated as one accounting
period) from January 1, 2004 to the end of the most recent fiscal quarter at
the time of such dividend, distribution or advance.
"Disqualified Stock" with respect to any Person means any
Capital Stock or Equity Interests that by its terms (or by the terms of any
security into which it is convertible or for which it is exchangeable), or
upon the happening of any event, matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or is redeemable at the
option of the holder thereof, in whole or in part on, or prior to, the
maturity date of the Securities, or any Capital Stock or Equity Interests in
any Restricted Subsidiary of such Person.
"Equity Interests" means Capital Stock or partnership
interests or warrants, options or other rights to acquire Capital Stock or
partnership interests (but excluding (i) any debt security that is convertible
into, or exchangeable for, Capital Stock or partnership interests, and (ii)
any other Indebtedness or Obligation).
"Equity Offering" means a public or private offering by the
Company or Fedders Corporation for cash of Capital Stock or other Equity
Interests and all warrants, options or other rights to acquire Capital Stock,
other than an offering of Disqualified Stock.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Event of Default" see Section 6.01.
"Excess Proceeds" see Section 4.05.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the Commission
thereunder.
"Existing Notes" means the 9?% Senior Subordinated Notes due
2007 of the Company.
"Final Maturity Date" means March 1, 2014.
"Foreign Subsidiary" means any Restricted Subsidiary of the
Company that is not organized under the laws of the United States of America
of any State thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles,
consistently applied, as in effect in the United States from time to time.
Except as otherwise permitted by this Indenture, all financial and accounting
determinations and calculations under the Indenture will be made in accordance
with GAAP.
"Guarantees" means the guarantee by Fedders Corporation and
the Subsidiary Guarantors of the Company's obligations with respect to the
Securities, including any Guarantee entered into after the Issue Date.
"Guaranteed Obligations" see Section 10.01.
"Guarantors" means Fedders Corporation, the sole stockholder
of the Company, and the Subsidiary Guarantors.
"Guaranty Agreement" means a supplemental indenture, in a
form satisfactory to the Trustee, pursuant to which a Subsidiary Guarantor
guarantees the Company's obligations with respect to the Securities on the
terms provided for in this Indenture.
"Hedging Obligations" means, with respect to any Person, the
Obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, (ii) foreign exchange
contracts, currency swap agreements or similar agreements, and (iii) other
agreements or arrangements designed to protect such Person against
fluctuations, or otherwise to establish financial xxxxxx in respect of,
exchange rates, currency rates or interest rates.
"Holder," "holder of Securities," "Securityholders" or other
similar terms mean the registered holder of any Security.
"Indebtedness" means, with respect to any Person, (i) any
indebtedness, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or representing the
deferred and unpaid balance of the purchase price of any property (including
pursuant to capital leases), except any such balance that constitutes an
accrued expense or a trade payable, and any Hedging Obligations, if and to the
extent such indebtedness (other than a Hedging Obligation) would appear as a
liability upon a balance sheet of such Person prepared on a consolidated basis
in accordance with GAAP, and also includes, to the extent not otherwise
included, the guarantee of items that would be included within this
definition; (ii) Disqualified Stock of such Person; or (iii) Preferred Stock
issued by a Restricted Subsidiary of such Person.
"Indenture" means this Indenture as amended or supplemented
from time to time.
"Interest Payment Date" means each semiannual interest
payment date on March 1 and September 1 of each year.
"Interest Record Date" for the interest payable on any
Interest Payment Date (except a date for payment of defaulted interest) means
the February 15 or August 15 (whether or not a Business Day), as the case may
be, immediately preceding such Interest Payment Date.
"Investment" means any capital contribution to, or other
debt or equity investment in, any Person. For the purposes of Section 4.06,
the amount of any Investment shall be the original cost of such Investment
plus the cost of all additional Investments by the Company or any of the
Restricted Subsidiaries, without any adjustments for increases or decreases in
value, or write-ups, write-downs or write-offs with respect to such
Investment, reduced by the payment of dividends or distributions in connection
with such Investment or any other amounts received by the Company or any
Restricted Subsidiary in respect of such Investment to the extent not included
in Consolidated Net Income.
"issue" means create, issue, assume, guarantee, incur or
otherwise become directly or indirectly liable for any Indebtedness or Capital
Stock, as applicable; provided, however, that any Indebtedness or Capital
Stock of a Person existing at the time such Person becomes a Restricted
Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall
be deemed to be issued by such Restricted Subsidiary at the time it becomes a
Restricted Subsidiary. For this definition, the terms "issuing," "issuer,"
"issuance" and "issued" have meanings correlative to the foregoing.
"Issue Date" means March 8, 2004.
"Legal Defeasance Option" see Section 8.02.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement to
sell and any filing of or agreement to give any financing statement under the
Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Net Income" means, with respect to any Person, the net
income (loss) of such Person, determined in accordance with GAAP, excluding,
however, any gain or loss, together with any related provision for taxes,
realized in connection with any Asset Sale (including, without limitation,
dispositions pursuant to sale and leaseback transactions).
"Net Proceeds" means, with respect to any Asset Sale, the
aggregate amount of cash proceeds (including any cash received by way of
deferred payment pursuant to a note receivable issued in connection with such
Asset Sale, other than the portion of such deferred payment constituting
interest, and including any amounts received as disbursements or withdrawals
from any escrow or similar account established in connection with any such
Asset Sale, but, in either such case, only as and when so received) received
by (A) the Company or any of its Restricted Subsidiaries in respect of such
Asset Sale or (B) Fedders Corporation or any Non-FNA Subsidiary in respect of
such Asset Sale, net of: (i) the cash expenses of such Asset Sale (including,
without limitation, the payment of principal of, and premium, if any, and
interest on, Indebtedness required to be paid as a result of such Asset Sale
(other than the Securities) and legal, accounting, management and advisory and
investment banking fees and sales commissions), (ii) taxes paid or payable as
a result thereof, and (iii) any portion of cash proceeds that Fedders
Corporation determines in good faith should be reserved for post-closing
adjustments, it being understood and agreed that on the day that all such
post-closing adjustments have been determined, the amount (if any) by which
the reserved amount in respect of such Asset Sale exceeds the actual
post-closing adjustments, payable by the Company or any of its Restricted
Subsidiaries or Fedders Corporation or any Non-FNA Subsidiary shall constitute
Net Proceeds on such date.
"New York Presenting Agent" see Section 4.02.
"Non-FNA Subsidiary" means any Subsidiary of Fedders
Corporation other than the Company and its Subsidiaries.
"Non-Restricted Subsidiary" means any Subsidiary of the
Company other than a Restricted Subsidiary.
"Obligations" means, with respect to any Indebtedness, all
principal, interest, premiums, penalties, fees, indemnities, expenses
(including legal fees and expenses), reimbursement obligations and other
liabilities payable to the holder of such Indebtedness under the documentation
governing such Indebtedness, and other claims of such holder arising in
respect of such Indebtedness.
"Officer" means the Chairman of the Board of Directors, the
President, any Vice President, the Treasurer or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company, Fedders Corporation or the Trustee.
"Other Company Indebtedness Guarantee" see Section 4.19.
"Other Permitted Indebtedness" means (i) Indebtedness of the
Company and its Restricted Subsidiaries existing as of the Issue Date and all
related Obligations as in effect on such date; (ii) Indebtedness of the
Company and its Restricted Subsidiaries in respect of bankers acceptances and
letters of credit (including, without limitation, letters of credit in respect
of workers' compensation claims) issued in the ordinary course of business, or
other Indebtedness in respect of reimbursement-type obligations regarding
workers' compensation claims; (iii) Refinancing Indebtedness; provided that:
(A) the principal amount of such Refinancing Indebtedness shall not exceed the
outstanding principal amount of Indebtedness (including unused commitments)
extended, refinanced, renewed, replaced, substituted or refunded plus any
amounts incurred to pay premiums, fees and expenses in connection therewith,
(B) the Refinancing Indebtedness shall have a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of the
Indebtedness being extended, refinanced, renewed, replaced, substituted or
refunded and (C) a Restricted Subsidiary that is not a Subsidiary Guarantor
may not refinance Indebtedness of the Company or of any Subsidiary Guarantor;
(iv) intercompany Indebtedness of and among the Company and its Restricted
Subsidiaries (excluding guarantees by Restricted Subsidiaries of Indebtedness
of the Company not issued in compliance with Section 4.19); (v) Indebtedness
of any Non-Restricted Subsidiary created after the Issue Date; provided that
such Indebtedness is nonrecourse to the Company and its Restricted
Subsidiaries and the Company and its Restricted Subsidiaries have no
Obligations with respect to such Indebtedness; (vi) Indebtedness of the
Company and its Restricted Subsidiaries under Hedging Obligations; (vii)
Indebtedness of the Company and its Restricted Subsidiaries arising from the
honoring by a bank or other financial institution of a check, draft or similar
instrument inadvertently (except in the case of daylight overdrafts, which
will not be, and will not be deemed to be, inadvertent) drawn against
insufficient funds in the ordinary course of business; (viii) guarantees by a
Restricted Subsidiary of Indebtedness of the Company if the Indebtedness so
guaranteed is permitted under this Indenture and the Securities are guaranteed
by such Restricted Subsidiary to the extent required by Section 4.19; (ix)
Indebtedness of the Company and its Restricted Subsidiaries in connection with
performance, surety, statutory, appeal or similar bonds in the ordinary course
of business; (x) intercompany Indebtedness of the Company owed to Fedders
Corporation; provided such Indebtedness does not bear interest; and (xi) the
Existing Notes (but no Refinancing Indebtedness in respect thereof).
"Paying Agent" see Section 2.03.
"Permitted Holders" means the Xxxxxxxx Holding Company, a
New Jersey corporation, its successors, its stockholders on the Issue Date and
their respective Affiliates.
"Permitted Liens" means with respect to the Company and its
Restricted Subsidiaries, (i) Liens for taxes, assessments, governmental
charges or claims which are being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and if a reserve or
other appropriate provision, if any, as shall be required in conformity with
GAAP shall have been made therefor; (ii) statutory Liens of landlords and
carriers', warehousemen's, mechanics', suppliers', materialmen's, repairmen's
or other like Liens arising in the ordinary course of business and with
respect to amounts not yet delinquent or being contested in good faith by
appropriate proceedings, if a reserve or other appropriate provision, if any,
as shall be required in conformity with GAAP shall have been made therefor;
(iii) Liens incurred on deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other types
of social security; (iv) Liens incurred on deposits made to secure the
performance of tenders, bids, leases, statutory obligations, surety and appeal
bonds, government contracts, performance and return of money bonds and other
obligations of a like nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money); (v) easements,
rights-of-way, zoning or other restrictions, minor defects or irregularities
in title and other similar charges or encumbrances not interfering in any
material respect with the business of the Company or any of its Restricted
Subsidiaries incurred in the ordinary course of business; (vi) Liens in favor
of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of goods; (vii)
judgment and attachment Liens not giving rise to an Event of Default; (viii)
leases or subleases granted to others not interfering in any material respect
with the business of the Company or any of its Restricted Subsidiaries; (ix)
Liens securing Indebtedness under Hedging Obligations; (x) Liens encumbering
deposits made to secure obligations arising from statutory, regulatory,
contractual or warranty requirements; (xi) Liens arising out of consignment or
similar arrangements for the sale of goods entered into by the Company or its
Restricted Subsidiaries in the ordinary course of business; (xii) Liens
arising from filing Uniform Commercial Code financing statements regarding
leases; (xiii) Liens existing on the Issue Date and any extensions,
refinancings, renewals, replacements, substitutions or refundings thereof;
(xiv) any Lien granted to the Trustee and any substantially equivalent Lien
granted to any trustee or similar institution under any indenture for the
Existing Notes or any Senior Indebtedness permitted by the terms of this
Indenture; (xv) Liens securing Indebtedness of the Company or a Subsidiary
Guarantor if such Indebtedness is permitted to be incurred pursuant to Section
4.04(b)(i); (xvi) Liens securing Indebtedness of the Company and its
Restricted Subsidiaries in connection with capital leases, sale and leaseback
transactions, purchase money obligations, capital expenditures or similar
financing transactions, which Indebtedness is permitted under Section 4.04 or
4.18; (xvii) Liens on property existing at the time of acquisition thereof by
the Company or a Restricted Subsidiary of the Company; provided that such
Liens were in existence prior to the contemplation of such acquisition;
(xviii) Liens securing Senior Indebtedness of the Company or a Restricted
Subsidiary; provided, however, that the aggregate amount of Senior
Indebtedness secured by a Lien pursuant to this clause (xviii) shall not
exceed $25.0 million outstanding at any time; provided further, however, that
Liens outstanding pursuant to any other clause of this definition shall not be
counted for purposes of this calculation if not outstanding pursuant to this
clause (xviii); and (xix) additional Liens at any one time outstanding in
respect of properties or assets where aggregate fair market value does not
exceed $2,000,000 (the fair market value to be determined on the date such
Lien is granted on such properties or assets).
"Person" means any individual, corporation, limited
liability company, limited or general partnership, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
"Preferred Stock" of any Person means Capital Stock of such
Person of any class or classes (however designated) that ranks prior, as to
the payment of dividends or as to the distribution of assets upon any
voluntary or involuntary liquidation, dissolution or winding up of such
Person, to shares of Capital Stock of any other class of such Person.
"principal" of a debt security means the principal of the
security, plus, when appropriate, the premium, if any, on the security.
"Pro Forma Basis" means, for purposes of determining
Consolidated Net Income in connection with the Cash Flow Coverage Ratio
(including in connection with Sections 4.06, 4.16 and 5.01, the incurrence of
Indebtedness pursuant to paragraph (a) of Section 4.04 and Consolidated Net
Worth for purposes of Section 5.01), giving pro forma effect to (x) any
acquisition or sale of a Person, business or asset, related incurrence,
repayment or refinancing of Indebtedness or other related transactions,
including any Restructuring Charges which would otherwise be accounted for as
an adjustment permitted by Regulation S-X under the Securities Act or on a pro
forma basis under GAAP, or (y) any incurrence, repayment or refinancing of any
Indebtedness and the application of the proceeds therefrom, in each case, as
if such acquisition or sale and related transactions, restructurings,
consolidations, cost savings, reductions, incurrence, repayment or refinancing
were realized on the first day of the relevant period permitted by Regulation
S-X under the Securities Act or on a pro forma basis under GAAP.
Notwithstanding the foregoing, the Consolidated Net Income (loss), the EBITDA
and the Consolidated Interest Expense of NYCOR North America, Inc. and its
Subsidiaries for all periods prior to January 1, 2004 shall be excluded from
any calculation required by this Indenture. Furthermore, in calculating the
Cash Flow Coverage Ratio, (1) interest on outstanding Indebtedness determined
on a fluctuating basis as of the determination date and which will continue to
be so determined thereafter shall be deemed to have accrued at a fixed rate
per annum equal to the rate of interest on such Indebtedness in effect on the
determination date; (2) if interest on any Indebtedness actually incurred on
the determination date may optionally be determined at an interest rate based
upon a factor of a prime or similar rate, a eurocurrency interbank offered
rate, or other rates, then the interest rate in effect on the determination
date will be deemed to have been in effect during the relevant period; (3)
notwithstanding clause (1) above, interest on Indebtedness determined on a
fluctuating basis, to the extent such interest is covered by agreements
relating to interest rate swaps or similar interest rate protection Hedging
Obligations, shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such agreements; and (4) interest on
outstanding Indebtedness determined on a fixed basis pursuant to its terms
will continue to be so determined, notwithstanding the fact that such interest
may be covered by agreements relating to interest rate swaps or similar
interest rate protection Hedging Obligations that effectively convert such
fixed rate interest to fluctuating interest.
"Redemption Date," when used with respect to any Security to
be redeemed, means the date fixed for such redemption pursuant to this
Indenture.
"redemption price," when used with respect to any Security
to be redeemed, means the price fixed for such redemption pursuant to this
Indenture as set forth in the forms of Security annexed hereto as Exhibits 1
and 2.
"Refinancing Indebtedness" means Indebtedness of the Company
and the Restricted Subsidiaries issued or given in exchange for, or the
proceeds of which are used to, extend, refinance, renew, replace, substitute
for or refund the Securities or Indebtedness contemplated by clause (i) of the
definition of Other Permitted Indebtedness or any Indebtedness issued to so
extend, refinance, renew, replace, substitute for or refund such Indebtedness.
"Register" see Section 2.03.
"Registrar" see Section 2.03.
"Registration Rights Agreement" means the Registration
Rights Agreement dated March 8, 2004, among the Company, Fedders Corporation,
the Subsidiary Guarantors and Credit Suisse First Boston LLC.
"Related Business" means any business in which Fedders
Corporation or any of its Subsidiaries was engaged on the Issue Date and any
business determined by the Board of Directors to be related, ancillary or
complementary to such businesses.
"Restricted Investment" means any Investment in any Person;
provided that Restricted Investments will not include: (i) Investments in
marketable securities and other negotiable instruments permitted by this
Indenture; (ii) Investments in the Company; (iii) Investments in any
Restricted Subsidiary or in a Person that becomes a Restricted Subsidiary as a
result of such investment (provided that any Investment in a Restricted
Subsidiary or in a Person that becomes a Restricted Subsidiary is made for
fair market value as determined by the Board of Directors in good faith));
(iv) Investments which existed on the Issue Date; (v) Investments in joint
ventures not to exceed $5 million outstanding at any time; (vi) 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; (vii) payroll, travel and
similar advances to cover matters that are expected at the time of such
advances ultimately to be treated as expenses for accounting purposes and that
are made in the ordinary course of business; (viii) loans or advances to
employees made in the ordinary course of business consistent with past
practices of the Company or such Restricted Subsidiary; (ix) stock,
obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments; (x) Investments acquired by the
Company or any of its Restricted Subsidiaries (A) in exchange for any
Investment or accounts receivable held by the Company or any such Restricted
Subsidiary in connection with or as a result of a bankruptcy, workout,
reorganization or recapitalization of the issuer of such other Investment or
accounts receivable or (B) as a result of a foreclosure by the Company or any
of its Restricted Subsidiaries with respect to any secured Investment or other
transfer of title with respect to any secured Investment in default; (xi)
Investments consisting of prepaid expenses, negotiable instruments held for
collection and lease, utility and workers' compensation, performance and other
similar deposits made in the ordinary course of business by the Company or any
Restricted Subsidiary; (xii) investments consisting of Hedging Obligations
otherwise permitted under Section 4.04; (xiii) extensions, modifications or
renewals of any Investments existing on the Issue Date; or (xiv) Investments
made in exchange for Capital Stock (other than Disqualified Stock) of the
Company or Fedders Corporation. The amount of any Restricted Investment shall
be the amount of cash and the fair market value at the time of transfer of all
other property (as determined by the Board of Directors in good faith)
initially invested or paid for such Restricted Investment, plus all additions
thereto, without any adjustments for increases or decreases in value of or
write-ups, write-downs or write-offs with respect to, such Restricted
Investment.
"Restricted Payments" see Section 4.06.
"Restricted Subsidiary" means: (i) any Subsidiary of the
Company existing on the Issue Date, other than FNA Mauritius Co., Inc.,
Fedders Shanghai Co., Ltd., Xi'an Fedders Xxxx Xxxx Air Conditioner Compressor
Co., Ltd., Fedders Indoor Air Quality (Suzhou) Co., Ltd., Fedders de Mexico SA
de CV and Quanzhou Melcor Xxx Xx Thermoelectric Co., Ltd.; (ii) Melcor
Corporation and Xxxxxx Manufacturing Enterprises, Inc.; and (iii) any other
Subsidiary of the Company formed, acquired or existing after the Issue Date
that is designated as a "Restricted Subsidiary" by the Company pursuant to a
resolution approved by a majority of the Board of Directors; provided,
however, that the term Restricted Subsidiary shall not include any Subsidiary
of the Company that has been redesignated by the Company pursuant to a
resolution approved by a majority of the Board of Directors as a
Non-Restricted Subsidiary in accordance with Section 4.16 unless such
Subsidiary shall have subsequently been redesignated a Restricted Subsidiary
in accordance with clause (ii) of this definition.
"Restructuring Charges" means any charges or expenses in
respect of restructuring or consolidating any business, operations or
facilities, any compensation or headcount reduction, or any other cost
savings, of any persons or businesses either alone or together with the
Company or any Restricted Subsidiary, as permitted by GAAP or Regulation S-X
under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act, as it
may be amended from time to time, and any successor provision thereto.
"Securities" means the Securities issued under this
Indenture.
"Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated by the Commission
thereunder.
"Securities Custodian" means the Trustee, as custodian with
respect to the Securities, or any successor entity thereto.
"Senior Indebtedness" means the principal of, premium, if
any, and interest (including any interest accruing subsequent to the filing of
a petition of bankruptcy at the rate provided for in the documentation with
respect thereto, whether or not such interest is an allowed claim under
applicable law) on any Indebtedness of the Company, whether outstanding on the
Issue Date or thereafter created, incurred or assumed, unless, in the case of
any particular Indebtedness, the instrument creating or evidencing the same or
pursuant to which the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to the Securities.
Without limiting the generality of the foregoing, "Senior Indebtedness" shall
also include the principal of, premium, if any, interest (including any
interest accruing subsequent to the filing of a petition of bankruptcy at the
rate provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) on, and all other
amounts owing in respect of, all monetary obligations (including guarantees
thereof) of every nature of the Company under the Credit Agreement, including,
without limitation, obligations to pay principal and interest, reimbursement
obligations under letters of credit, fees, expenses and indemnities and the
guarantee of any obligations owing by any Subsidiary under the Credit
Agreement. "Senior Indebtedness" shall not include (i) any Indebtedness of the
Company to a Subsidiary of the Company, (ii) Indebtedness to, or guaranteed on
behalf of, any shareholder, director, officer or employee of either the
Company or any Subsidiary of the Company (including, without limitation,
amounts owed for compensation), (iii) Indebtedness to trade creditors and
other amounts incurred in connection with obtaining goods, materials or
services, (iv) Indebtedness represented by Disqualified Stock, (v) any
liability for federal, state, local or other taxes owed or owing by the
Company, (vi) that portion of any Indebtedness incurred in violation of the
Indenture provisions set forth in Section 4.04 and (vii) any Indebtedness
which is, by its express terms, subordinated in right of payment to any other
Indebtedness of the Company.
"Services Agreement" means the Services Agreement dated as
of February 27, 2004 between the Company and Fedders Corporation.
"Significant Subsidiary" means any Restricted Subsidiary of
the Company that would be a "significant subsidiary" as defined in clause (2)
of the definition of such term in Rule 1-02 of Regulation S-X under the
Securities Act and the Exchange Act.
"Subordinated Obligations" means, with respect to a Person,
any Indebtedness of such Person (whether outstanding on the Issue Date or
thereafter incurred) which is subordinate or junior in right of payment to the
Securities or a Guarantee of such Person, as the case may be, pursuant to a
written agreement to that effect.
"Subsidiary" of any Person means any entity of which the
Equity Interests entitled to cast at least a majority of the votes that may be
cast by all Equity Interests having ordinary voting power for the election of
directors or other governing body of such entity are owned by such Person
(regardless of whether such Equity Interests are owned directly by such Person
or through one or more Subsidiaries).
"Subsidiary Guarantor" means each Subsidiary of the Company
that executes this Indenture as a guarantor on the Issue Date and each other
Subsidiary of the Company that thereafter guarantees the Securities pursuant
to the terms of this Indenture.
"Subsidiary Guaranty" means the Guarantee by a Subsidiary
Guarantor of the Company's obligations with respect to the Securities.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
xx.xx. 77aaa-77bbbb), as amended, as in effect on the date of this Indenture,
except as provided in Section 9.03.
"Trust Officer" means any officer within the corporate trust
department (or any successor group) of the Trustee including any vice
president, assistant vice president, assistant secretary, trust officer or any
other officer or assistant officer of the Trustee customarily performing
functions similar to those performed by the persons who at that time shall be
such officers, and also means, with respect to a particular corporate trust
matter, any other officer to whom such trust matter is referred because of his
knowledge of and familiarity with the particular subject.
"Trustee" means the party named as such in this Indenture
until a successor replaces it in accordance with the provisions of this
Indenture and thereafter means such successor.
"UCC" means the Uniform Commercial Code as in effect from
time to time in the State of New York.
"U.S. Government Obligations" means direct, non-callable
obligations of the United States of America for the payment of which the full
faith and credit of the United States is pledged.
"U.S. Person" means a "U.S. person" as defined in Rule 902
under the Securities Act.
"Voting Stock" means any class or classes of Capital Stock
pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect the board of directors.
"Weighted Average Life to Maturity" means, when applied to
any Indebtedness at any date, the number of years obtained by dividing (i) the
then outstanding principal amount of such Indebtedness into (ii) the sum of
the product(s) obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
SECTION 1.02. 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:
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company or
any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined
by the TIA, defined by TIA reference to another statute or defined by
Commission rule and not otherwise defined herein have the meanings assigned to
them therein.
SECTION 1.03. 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 words in
the plural include the singular;
(5) provisions apply to successive events and transactions;
and
(6) "herein," "hereof" and other words of similar import
refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
ARTICLE II
THE SECURITIES
SECTION 2.01. Form and Dating. Provisions relating to the
Initial Securities, the Private Exchange Securities and the Exchange
Securities are set forth in the Rule 144A/Regulation S/IAI Appendix attached
hereto (the "Appendix") which is hereby incorporated in, and expressly made
part of, this Indenture. The Initial Securities and the Trustee's certificate
of authentication shall be substantially in the form of Exhibit 1 to the
Appendix which is hereby incorporated in, and expressly made a part of, this
Indenture. The Exchange Securities, the Private Exchange Securities and the
Trustee's certificate of authentication shall be substantially in the form of
Exhibit 2 to the Appendix, which is hereby incorporated in and expressly made
a part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule, agreements to which the
Company is subject, if any, or usage (provided that any such notation, legend
or endorsement is in a form acceptable to the Company). Each Security shall be
dated the date of its authentication. The terms of the Securities set forth in
the Appendix are part of the terms of this Indenture.
SECTION 2.02. Execution and Authentication. One Officer
shall sign, or one Officer shall sign the Securities for the Company by manual
or facsimile signature.
If an Officer whose signature is on a Security was an
Officer at the time of such execution but no longer holds that office at the
time the Trustee authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be valid until an authorized signatory
of the Trustee manually signs the certificate of authentication on the
Security. The signature shall be conclusive evidence that the Security has
been authenticated under this Indenture.
Upon receipt of a written order of the Company in the form
of an Officers' Certificate, on the Issue Date the Trustee shall authenticate
$155.0 million of 97/8% Senior Notes Due 2014. In addition, subject to Section
4.04, from time to time, the Trustee shall authenticate Additional Securities
for original issue after the Issue Date in an aggregate principal amount
specified in such order upon receipt of a written order of the Company in the
form of an Officers' Certificate. Each such Officers' Certificate shall
specify the amount of Securities to be authenticated and the date on which the
Securities are to be authenticated, and, in the case of issuance of Additional
Securities pursuant to Section 2.15 after the Issue Date, shall certify that
such issuance is not prohibited by Section 4.04.
Upon receipt of a written order of the Company in the form
of an Officers' Certificate, the Trustee shall authenticate Securities in
substitution for Securities originally issued to reflect any name change of
the Company.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate Securities. Unless otherwise
provided in the appointment, an authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company
and Affiliates of the Company.
The Securities shall be issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03. ...Registrar and Paying Agent. The Company shall maintain an
office or agency where (a) Securities may be presented or surrendered for
registration of transfer or for exchange ("Registrar"), (b) Securities may be
presented or surrendered for payment ("Paying Agent") and (c) notices and
demands in respect of the Securities and this Indenture may be served. The
Registrar shall keep a register (the "Register") of the Securities and of
their transfer and exchange. The Company, upon notice to the Trustee, may
appoint one or more co-Registrars and one or more additional Paying Agents.
The term "Paying Agent" includes any additional Paying Agent. Except as
provided herein, the Company, or any Subsidiary may act as Paying Agent,
Registrar or co-Registrar.
The Company shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture, which shall incorporate the
provisions of the TIA. The agreement shall implement the provisions of this
Indenture that relate to such Agent. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, or fails to give the foregoing notice, the Trustee
shall act as such and shall be entitled to appropriate compensation in
accordance with Section 7.07.
The Company initially appoints the Trustee as Registrar and
Paying Agent until such time as the Trustee has resigned or a successor has
been appointed.
The Company initially appoints The Depositary Trust Company
("DTC") to act as Depositary with respect to the Securities.
SECTION 2.04. Paying Agent to Hold Assets in Trust. The
Company shall require each Paying Agent other than the Trustee to agree in
writing that each Paying Agent shall hold in trust for the benefit of Holders
or the Trustee all assets held by the Paying Agent for the payment of
principal of or premium, if any, or interest or Additional Interest (as
defined in the Registration Rights Agreement), if any, on the Securities, and
shall notify the Trustee of any Default by the Company in making any such
payment. The Company at any time may require a Paying Agent to distribute all
assets held by it to the Trustee and account for any assets disbursed and the
Trustee may at any time during the continuance of any payment Default, upon
written request to a Paying Agent, require such Paying Agent to distribute all
assets held by it to the Trustee and to account for any assets distributed.
Upon distribution to the Trustee of all assets that shall have been delivered
by the Company to the Paying Agent (if other than the Company), the Paying
Agent shall have no further liability for such assets. If the Company, any
Subsidiary or any of their respective Affiliates acts as Paying Agent, it
shall, on or before each due date of the principal of or interest on the
Securities, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal or premium, if any, or,
interest or Additional Interest, if any, so becoming due until such sums shall
be paid to such Persons or otherwise disposed of as herein provided and will
promptly notify the Trustee of its action or failure so to act.
SECTION 2.05. Securityholder Lists. The Trustee shall
preserve in as current a form as is reasonably practicable the most recent
list available to it of the names and addresses of Holders. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee before each
Interest Record Date and at such other times as the Trustee may request in
writing a list as of such date and in such form as the Trustee may reasonably
require of the names and addresses of Holders, which list may be conclusively
relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange. The Securities shall be
issued in registered form and shall be transferable only upon the surrender of
a Security for registration of transfer. When a Security is presented to the
Registrar or a co-registrar with a request to register a transfer, the
Registrar shall register the transfer as requested if the requirements of this
Indenture and Section 8-401(1) of the UCC are met. When Securities are
presented to the Registrar or a co-registrar with a request to exchange them
for an equal principal amount of Securities of other denominations, the
Registrar shall make the exchange as requested if the same requirements are
met. Neither the Company nor the registrar is required to issue, register the
transfer of, or exchange (i) any Securities selected for redemption or
tendered pursuant to an offer or (ii) any Securities during the period between
(a) the date the Trustee receives notice of redemption from the Company and
the date the Securities to be redeemed are selected by the Trustee or (b) a
record date and the next succeeding interest payment date.
SECTION 2.07. Replacement Securities. If a mutilated
Security is surrendered to the Trustee or if the Holder of a Security claims
that the Security has been lost, destroyed or wrongfully taken, the Company
shall issue and the Trustee shall authenticate a replacement Security if the
Company's and the Trustee's requirements for replacement of Securities are
met. Such Holder must provide an indemnity bond or other indemnity, sufficient
in the judgment of both the Company and the Trustee, to protect the Company,
the Trustee and any Agent from any loss which any of them may suffer if a
Security is replaced and evidence to their satisfaction of the apparent loss,
destruction or theft of such Security. The Company may charge such Holder for
its reasonable out-of-pocket expenses in replacing a Security, including
reasonable fees and expenses of counsel.
Every replacement Security is an additional obligation of
the Company.
SECTION 2.08. Outstanding Securities. Securities outstanding
at any time are all the Securities that have been authenticated by the Trustee
except those canceled by it, those delivered to it for cancellation and those
described in this Section 2.08 as not outstanding. Subject to Section 2.09, a
Security does not cease to be outstanding because the Company or any of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other
than a mutilated Security surrendered for replacement), it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser. A mutilated Security
ceases to be outstanding upon surrender of such Security and replacement
thereof pursuant to Section 2.07.
If on a Redemption Date or the Final Maturity Date the
Paying Agent holds money sufficient to pay all of the principal and interest
due on the Securities payable on that date, then on and after that date such
Securities cease to be outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Securities. In determining whether
the Holders of the required principal amount of Securities have concurred in
any direction, waiver or consent, Securities owned by the Company, a Guarantor
or any of their respective Affiliates shall be disregarded, except that, for
the purposes of determining whether the Trustee shall be protected in relying
on any such direction, waiver or consent, only Securities that a Trust Officer
of the Trustee actually knows are so owned shall be disregarded.
The Trustee may require an Officers' Certificate listing
Securities owned by the Company, the Guarantors or, to the knowledge of the
Officers signing such Officers' Certificate, their respective Affiliates.
SECTION 2.10. Temporary Securities. Until definitive
Securities are ready for delivery, the Company may prepare and the Trustee
shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have variations
that the Company considers appropriate for temporary Securities. Without
unreasonable delay, the Company shall prepare and the Trustee shall
authenticate upon receipt of a Company Order pursuant to Section 2.02
definitive Securities in exchange for temporary Securities.
SECTION 2.11. Cancellation. The Company at any time may
deliver Securities to the Trustee for cancellation. The Registrar and the
Paying Agent shall forward to the Trustee any Securities surrendered to them
for transfer, exchange or payment. The Trustee, or at the direction of the
Trustee, the Registrar or the Paying Agent, and no one else, shall cancel all
Securities surrendered for transfer, exchange, payment or cancellation and
deliver to the Company such canceled Securities for disposal. Subject to
Section 2.07, the Company may not issue new Securities to replace Securities
that it has paid or delivered to the Trustee for cancellation. If the Company
or any Guarantor shall acquire any of the Securities, such acquisition shall
not operate as a redemption or satisfaction of the Indebtedness represented by
such Securities unless and until the same are surrendered to the Trustee for
cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest. If the Company defaults in
a payment of principal of or interest on the Securities, it shall pay interest
on overdue principal and on overdue installments of interest (without regard
to any applicable grace periods) from time to time on demand at the rate per
annum borne by the Securities, to the extent lawful.
SECTION 2.13. CUSIP Numbers. The Company in issuing the
Securities will use "CUSIP" numbers, and the Trustee shall use the CUSIP
numbers in notices of redemption or exchange as a convenience to Holders;
provided that any such notice may state that no representation is made as to
the correctness or accuracy of the CUSIP numbers printed in the notice or on
the Securities and that reliance may be placed only on the other
identification numbers printed on the Securities. The Company shall promptly
notify the Trustee of any changes in CUSIP numbers.
SECTION 2.14. Deposit of Moneys. Prior to 10:00 a.m. New
York City time on each Interest Payment Date, Redemption Date and the Final
Maturity Date, the Company shall deposit with the Paying Agent in immediately
available funds money sufficient to make cash payments, if any, due on such
Interest Payment Date, Redemption Date or Final Maturity Date, as the case may
be, in a timely manner which permits the Paying Agent to remit payment to the
Holders on such Interest Payment Date, Redemption Date or Final Maturity Date,
as the case may be.
SECTION 2.15. Issuance of Additional Securities. The Company
shall be entitled to issue Additional Securities under this Indenture which
shall have identical terms as the Securities issued on the Issue Date, other
than with respect to the date of issuance, issue price and amount of interest
payable on the first payment date applicable thereto (and, if such Additional
Securities shall be issued in the form of Exchange Securities, other than with
respect to transfer restrictions); provided that such issuance is not
prohibited by Section 4.04.
With respect to any Additional Securities, the Company shall
set forth in a resolution of the Board of Directors and in an Officers'
Certificate, a copy of each of which shall be delivered to the Trustee, the
following information:
(A) the aggregate principal amount of such Additional
Securities to be authenticated and delivered pursuant to this
Indenture;
(B) the issue price, the issue date and the CUSIP number of
such Additional Securities and the amount of interest payable on the
first payment date applicable thereto; provided, however, that no
Additional Securities may be issued at a price that would cause such
Additional Securities to have "original issue discount" within the
meaning of Section 1273 of the Internal Revenue Code of 1986, as
amended, different than the "original issue discount" applicable to
the Initial Securities issued on the Issue Date; and
(C) whether such Additional Securities shall be issued in
the form of Initial Securities or shall be issued in the form of
Exchange Securities.
ARTICLE III
REDEMPTION
SECTION 3.01. Notices to Trustee. If the Company wants to
redeem Securities pursuant to paragraph 5 of the Securities at the applicable
redemption price set forth therein, it shall notify the Trustee in writing of
the Redemption Date and the principal amount of Securities to be redeemed. The
Company shall give such notice to the Trustee at least 45 days before the
Redemption Date (unless a shorter notice shall be agreed to by the Trustee in
writing), together with an Officers' Certificate stating that such redemption
will comply with the conditions contained herein.
SECTION 3.02. Selection of Securities to Be Redeemed. If
less than all of the Securities are to be redeemed pursuant to paragraph 5 of
the Securities, the Trustee shall select the Securities to be redeemed in
compliance with the requirements of the national securities exchange, if any,
on which the Securities are listed or, if the Securities are not then listed
on a national securities exchange, on a pro rata basis to the extent
practicable, and if not practicable, by lot or by any other method as the
Trustee shall deem fair and appropriate. Selection of the Securities to be
redeemed pursuant to the second paragraph of paragraph 5 of the Securities
shall be made by the Trustee only on a pro rata basis or on as nearly a pro
rata basis as is practicable (subject to the procedures of the Depositary)
based on the aggregate principal amount of Securities held by each Holder. The
Trustee shall make the selection from the Securities then outstanding, subject
to redemption and not previously called for redemption.
The Trustee may select for redemption pursuant to paragraph
5 of the Securities portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000
principal amount or integral multiples thereof. Provisions of this Indenture
that apply to Securities called for redemption also apply to portions of
Securities called for redemption.
SECTION 3.03. Notice of Redemption. At least 30 days but not
more than 60 days before a Redemption Date, the Company shall mail a notice of
redemption by first-class mail to each Holder whose Securities are to be
redeemed at such Holder's registered address.
Each notice of redemption shall identify the Securities to
be redeemed (including, but subject to the provisions of Section 2.13, the
CUSIP number thereon) and shall state:
(i) the Redemption Date;
(ii) the redemption price;
(iii) the name and address of the Paying Agent to which the
Securities are to be surrendered for redemption;
(iv) that Securities called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(v) that, unless the Company defaults in making the
redemption payment, interest on Securities called for redemption
ceases to accrue on and after the Redemption Date and the only
remaining right of the Holders is to receive payment-of the
redemption price upon surrender to the Paying Agent; and
(vi) if any Security is being redeemed in part, the portion
of the principal amount of such Security to be redeemed and that,
after the Redemption Date, upon surrender of such Security, a new
Security or Securities in principal amount equal to the unredeemed
portion thereof will be issued.
At the Company's request, the Trustee shall give the notice
of redemption on behalf of the Company, in the Company's name and at the
Company's expense.
SECTION 3.04. Effect of Notice of Redemption. Once a notice
of redemption is mailed, Securities called for redemption become due and
payable on the Redemption Date and at the redemption price specified in such
notice. Upon surrender to the Paying Agent, such Securities shall be paid at
the redemption price, plus accrued interest thereon, if any, to the Redemption
Date, but interest installments whose maturity is on or prior to such
Redemption Date shall be payable to the Holders of record at the close of
business on the relevant Interest Record Date.
SECTION 3.05. Deposit of Redemption Price. At least one
Business Day before the Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company is its own Paying Agent, shall, on or before
the Redemption Date, segregate and hold in trust) money sufficient to pay the
redemption price of and accrued interest and Additional Interest, if any, on
all Securities to be redeemed on that date other than Securities or portions
thereof called for redemption on that date which have been delivered by the
Company to the Trustee for cancellation.
If any Security surrendered for redemption in the manner
provided in the Securities shall not be so paid on the Redemption Date due to
the failure of the Company to deposit with the Paying Agent money sufficient
to pay the redemption price thereof, the principal and accrued and unpaid
interest, if any, thereon shall, until paid or duly provided for, bear
interest as provided in Sections 2.12 and 4.01 with respect to any payment
default.
SECTION 3.06. Securities Redeemed in Part. Upon surrender of
a Security that is redeemed in part, the Trustee shall authenticate for the
Holder a new Security equal in principal amount to the unredeemed portion of
the Security surrendered.
ARTICLE IV
COVENANTS
SECTION 4.01. Payment of Securities. The Company shall pay
the principal of and premium, if any, and interest and Additional Interest, if
any, on the Securities in the manner provided in the Securities and the
Registration Rights Agreement. An installment of principal, premium, interest
or Additional Interest shall be considered paid on the date due if the Trustee
or Paying Agent (other than the Company, a Subsidiary or an Affiliate of the
Company) holds on that date money designated for and sufficient to pay the
installment in full and is not prohibited from paying such money to the
Holders of the Securities pursuant to the terms of this Indenture. The Trustee
shall not be responsible for knowing the amount of Additional Interest due
unless the Trustee shall have been notified by the Company thereof.
The Company shall pay interest on overdue principal at the
same rate per annum borne by the Securities. The Company shall pay interest on
overdue installments of interest at the same rate per annum borne by the
Securities, to the extent lawful, as provided in Section 2.12.
SECTION 4.02. Maintenance of Office or Agency. The Company
shall maintain in the Borough of Manhattan, The City of New York, an office or
agency (which may be an office of the Trustee, Registrar or co-registrar)
where Securities may be surrendered for payment or for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be presented (the "New York
Presenting Agent"). The Company may also from time to time designate one or
more other offices or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an
office or agency in the Borough of Manhattan, The City of New York for such
purposes. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 11.02 hereof. The Company hereby
initially designates U.S. Bank National Association, 000 Xxxx Xxxxxx - Xxxxx
0000, Xxx Xxxx, Xxx Xxxx 00000, as its office or agency in The Borough of
Manhattan, The City of New York, for such purposes.
SECTION 4.03. Transactions with Affiliates. (a) The Company
shall not, and shall not cause or permit any Restricted Subsidiary to,
directly or indirectly, make any loan, advance, guarantee or capital
contribution to, or for the benefit of, or sell, lease, transfer or dispose of
any properties or assets to, or for the benefit of, or purchase or lease any
property or-assets from, or enter into or amend any contract, agreement or
understanding with, or for the benefit of, an Affiliate (each such transaction
or series of related transactions that are part of a common plan are referred
to as an "Affiliate Transaction"), except in good faith and on terms that are
no less favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction on an arm's
length basis from an unrelated person.
(b) The Company shall not, and shall not permit any
Restricted Subsidiary to, engage in any Affiliate Transaction involving
aggregate payments or other transfers by the Company and its Restricted
Subsidiaries in excess of $3,500,000 (including cash and non-cash payments and
benefits valued at their fair market value by the Board of Directors in good
faith) unless the Company delivers to the Trustee:
(i) a resolution of the Board of Directors stating that the
Board of Directors (including a majority of the disinterested
directors, if any) has, in good faith, determined that such
Affiliate Transaction complies with the provisions of the Indenture,
and
(ii) (A) with respect to any Affiliate Transaction involving
the incurrence of Indebtedness, a written opinion of a nationally
recognized investment banking or accounting firm experienced in the
review of similar types of transactions, (B) with respect to any
Affiliate Transaction involving the transfer of real property, fixed
assets or equipment, either directly or by a transfer of 50% or more
of the Capital Stock of a Restricted Subsidiary which holds any such
real property, fixed assets or equipment, a written appraisal from a
nationally recognized appraiser, experienced in the review of
similar types of transactions or (C) with respect to any Affiliate
Transaction not otherwise described in (A) and (B) above, a written
certification from a nationally recognized professional or firm
experienced in evaluating similar types of transactions, in each
case, stating that the terms of such transaction are fair to the
Company or such Restricted Subsidiary, as the case may be, from a
financial point of view.
(c) Notwithstanding paragraphs (a) and (b) of this Section
4.03, this Section 4.03 shall not apply to: (i) transactions between the
Company and any wholly owned Restricted Subsidiary or between wholly owned
Restricted Subsidiaries; (ii) transactions permitted by Section 4.06; (iii)
compensation paid to officers, employees or consultants of the Company or any
Subsidiary as determined in good faith by the Board of Directors or
executives; or (iv) transactions (A) between the Company or any of its
Subsidiaries and Fedders Corporation or (B) between the Company or any of its
Subsidiaries and a Subsidiary of Fedders Corporation in the ordinary course of
business on terms substantially consistent with past practice.
SECTION 4.04. Limitation on Incurrence of Indebtedness. (a)
The Company shall not, and shall not cause or permit any Restricted Subsidiary
to, directly or indirectly, issue any Indebtedness (other than the
Indebtedness represented by the Securities issued on the Issue Date in an
aggregate principal amount not to exceed $155,000,000); provided, however,
that the Company and the Subsidiary Guarantors will be entitled to issue
Indebtedness if the Company's Cash Flow Coverage Ratio for its four full
fiscal quarters next preceding the date such additional Indebtedness is issued
would have been at least 2.25 to 1 if such Indebtedness is issued prior to
March 1, 2005 or 2.5 to 1 if such Indebtedness is issued thereafter, in each
case determined on a Pro Forma Basis (including, for this purpose, any other
Indebtedness incurred since the end of the applicable four-quarter period) as
if such additional Indebtedness and any other Indebtedness issued since the
end of such four-quarter period had been issued at the beginning of such
four-quarter period.
(b) The foregoing limitations will not apply to the issuance
of:
(i) Indebtedness of the Company and/or the Subsidiary
Guarantors under one or more Credit Facilities as measured on such
date of issuance in an aggregate principal amount outstanding on any
such date of issuance not exceeding the greater of (x) the sum of
(A) 85% of the book value of the accounts receivable of the Company
and the Subsidiary Guarantors on a consolidated basis and (B) 70% of
the book value of the inventory of the Company and the Subsidiary
Guarantors on a consolidated basis or (y) $100,000,000;
(ii) Indebtedness of the Company and its Restricted
Subsidiaries in connection with capital leases, purchase money
obligations, capital expenditures or similar financing transactions
relating to their properties, assets and rights up to $15,000,000 in
aggregate principal amount;
(iii) additional Indebtedness of the Company and the
Subsidiary Guarantors in an aggregate principal amount of up to
$15,000,000; and
(iv) Other Permitted Indebtedness.
(c) Notwithstanding paragraphs (a) and (b) of this Section
4.04, no Restricted Subsidiary shall under any circumstances issue a guarantee
of any Indebtedness of the Company except for guarantees issued by Restricted
Subsidiaries pursuant to Section 4.19; provided, however, that the foregoing
will not limit or restrict guarantees issued by Restricted Subsidiaries in
respect of Indebtedness of other Restricted Subsidiaries.
SECTION 4.05. Limitation on Certain Asset Sales. (a) The
Company shall not, and shall not cause or permit any Restricted Subsidiary to,
directly or indirectly, consummate an Asset Sale (including the sale of any of
the Capital Stock of any Restricted Subsidiary) providing for Net Proceeds in
excess of $5,000,000 unless the Net Proceeds from such Asset Sale are applied
(in any manner otherwise permitted by this Indenture) to one or more of the
following purposes in such combination as the Company shall elect: (i) an
investment in any asset or business in a Related Business; provided that such
investment occurs on or prior to the 365th day following the date of such
Asset Sale (the "Asset Sale Disposition Date"), (ii) to reimburse the Company
or its Subsidiaries for expenditures made, and costs incurred, to repair,
rebuild, replace or restore property lost, damaged or taken to the extent that
the Net Proceeds consist of insurance proceeds received on account of such
loss, damage or taking, (iii) the purchase, redemption or other prepayment or
repayment of outstanding Senior Indebtedness or Indebtedness of the Company's
Restricted Subsidiaries on or prior to the 365th day following the Asset Sale
Disposition Date or (iv) an Asset Sale Offer expiring on or prior to the Asset
Sale Purchase Date. The Company shall not, and shall not cause or permit any
Restricted Subsidiary to, directly or indirectly, consummate an Asset Sale
unless at least 75% of the consideration therefor received by the Company or
such Restricted Subsidiary is in the form of cash, cash equivalents or
marketable securities; provided that, solely for purposes of calculating such
75% of the consideration, the amount of (x) any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance sheet or in the
notes thereto, excluding contingent liabilities and trade payables) of the
Company or any Restricted Subsidiary (other than liabilities that are by their
terms subordinated to the Securities) that are assumed by the transferee of
any such assets and (y) any notes or other obligations received by the Company
or any such Restricted Subsidiary from such transferee that are promptly, but
in no event more than 30 days after receipt, converted by the Company or such
Restricted Subsidiary into cash (to the extent of the cash received), shall be
deemed to be cash and cash equivalents for purposes of this provision. Any Net
Proceeds from any Asset Sale that are not applied or invested as provided in
the first sentence of this paragraph shall constitute "Excess Proceeds."
Fedders Corporation shall not, and shall not permit any of
its Non-FNA Subsidiaries to, directly or indirectly consummate an Asset Sale
unless the Net Proceeds from such Asset Sale are applied (in any manner
otherwise permitted by this Indenture) to one or more of the following
purposes in such combination as Fedders Corporation shall elect:
(i) an investment in another asset or business in a Related
Business; provided that such investment occurs on or prior to the
365th day following the Asset Sale Disposition Date;
(ii) to reimburse Fedders Corporation or its Subsidiaries
for expenditures made, and costs incurred, to repair, rebuild,
replace or restore property lost, damaged or taken to the extent
that the Net Proceeds consist of insurance proceeds received on
account of such loss, damage or taking;
(iii) the purchase, redemption or other prepayment or
repayment of outstanding Indebtedness of Fedders Corporation or
Indebtedness of Fedders Corporation's Subsidiaries (other than
Subordinated Obligations of the Company and the Subsidiary
Guarantors) on or prior to the 365th day following the Asset Sale
Disposition Date; or
(iv) an Asset Sale Offer expiring on or prior to the Asset
Sale Purchase Date.
(b) When the aggregate amount of Excess Proceeds exceeds
$6,500,000 (such date being an "Asset Sale Trigger Date"), the Company shall
make an Offer (an "Asset Sale Offer") to all holders of Securities to purchase
the maximum principal amount of the Securities then outstanding that may be
purchased out of Excess Proceeds, at an offer price in cash in an amount equal
to 100% of the principal amount thereof plus any accrued and unpaid interest
and Additional Interest, if any, to the date (the "Asset Sale Purchase Date")
the Securities tendered are purchased and paid for in accordance with this
Section 4.05.
Within 30 days following any Asset Sale Trigger Date, the
Company shall mail a notice to each holder of Securities at such holder's
registered address (with a copy to the Trustee) stating:
(i) that an Asset Sale Offer is being made pursuant to an
Asset Sale Trigger Date, the length of time the Asset Sale Offer
shall remain open and the maximum principal amount of Securities
that will be accepted for payment pursuant to such Asset Sale Offer;
(ii) the purchase price, the amount of accrued and unpaid
interest as of the Asset Sale Purchase Date and the Asset Sale
Purchase Date (which shall be no earlier than 30 days and no later
than 60 days from the date such notice is mailed);
(iii) that any Security or portion thereof not tendered or
accepted for payment will continue to accrue interest;
(iv) that any Security accepted for payment pursuant to the
Asset Sale Offer shall cease to accrue interest on and after the
Asset Sale Purchase Date;
(v) that Holders electing to have a Security purchased
pursuant to the Asset Sale Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Security completed, to a Paying
Agent at the address specified in the notice at least three Business
Days before the Asset Sale Purchase Date;
(vi) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than the close of
business on the third Business Day before the Asset Sale Purchase
Date, a facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Security the Holder
delivered for purchase and a statement that such Holder is
withdrawing his election to have the Security purchased;
(vii) that, if the aggregate principal amount of Securities
surrendered by Holders exceeds the Excess Proceeds, the Trustee
shall select the Securities to be purchased on a pro rata basis to
the extent practicable, and if not practicable, by lot or by any
other method that the Trustee considers fair and appropriate and, if
the Securities are listed on any securities exchange, by a method
that complies with the requirements of such exchange; provided that,
if less than all of a holder's Securities are to be redeemed or
accepted for payment, only principal amounts of $1,000 or integral
multiples thereof may be selected for redemption or accepted for
payment;
(viii) that Holders whose Securities were purchased only in
part will be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered; and
(ix) a brief description of the circumstances and relevant
facts regarding such Asset Sale.
On the Asset Sale Purchase Date, the Company will, to the
extent required by this Indenture and the Asset Sale Offer, (1) accept for
payment the maximum principal amount of Securities or portions thereof
tendered pursuant to the Asset Sale Offer that can be purchased out of Excess
Proceeds, (2) deposit with the Paying Agent the aggregate purchase price of
all Securities or portions thereof accepted for payment and any accrued and
unpaid interest and Additional Interest, if any, on such Securities as of the
Asset Sale Purchase Date, and (3) deliver or cause to be delivered to the
Trustee all Securities tendered pursuant to the Asset Sale Offer. The Paying
Agent shall promptly mail to each holder of Securities or portions thereof
accepted for payment an amount equal to the purchase price for such Securities
plus any accrued and unpaid interest thereon and Additional Interest, if any,
and the Trustee shall promptly authenticate and mail (or cause to be
transferred by book-entry) to such holder of Securities accepted for payment
in part a new Security equal in principal amount to any unpurchased portion of
the Securities and any Security not accepted for payment in whole or in part
shall be promptly returned to the holder thereof. The Company will publicly
announce the results of the Asset Sale Offer on or as soon as practicable
after the Asset Sale Purchase Date.
The Company will comply with any tender offer rules under
the Exchange Act which may then be applicable, including Rule 14e-1, in
connection with an Asset Sale offer. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Indenture, the
Company shall comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under this Indenture by
virtue thereof.
Notwithstanding the foregoing, to the extent that any or all
of the Net Proceeds of an Asset Sale are prohibited or delayed by applicable
local law from being repatriated to the United States, the portion of such Net
Proceeds so affected will not be required to be applied as described in this
Section 4.05, but may be retained for so long, but only for so long, as the
applicable local law prohibits repatriation to the United States.
To the extent that any Excess Proceeds remain after
completion of an Asset Sale Offer, the Company may use such remaining amount
for general corporate purposes. Upon completion of an Asset Sale Offer, the
amount of Excess Proceeds shall be reset at zero.
SECTION 4.06. Limitation on Restricted Payments. The Company
shall not, and shall not cause or permit any Restricted Subsidiary to,
directly or indirectly, (i) declare or pay any dividend or make any
distribution on account of the Company's or such Restricted Subsidiary's
Capital Stock or other Equity Interests (other than dividends or distributions
payable in Capital Stock or other Equity Interests (other than Disqualified
Stock) of the Company and dividends or distributions payable by a Restricted
Subsidiary to a Restricted Subsidiary or to the Company); (ii) purchase,
redeem or otherwise acquire or retire for value any Capital Stock or other
Equity Interests of the Company or any of its Restricted Subsidiaries; (iii)
make any principal payment on, purchase, defease, redeem, prepay, decrease or
otherwise acquire or retire for value, prior to any scheduled final maturity,
scheduled repayment or scheduled sinking fund payment, any Indebtedness of the
Company that is subordinate or junior in right of payment to the Securities;
or (iv) make any Restricted Investment (all such dividends, distributions,
purchases, redemptions, acquisitions, retirements, prepayments and Restricted
Investments being collectively referred to as "Restricted Payments"), if, at
the time of such Restricted Payment:
(a) a Default or Event of Default shall have occurred and be
continuing or shall occur as a consequence thereof; or
(b) immediately after such Restricted Payment and after
giving pro forma effect thereto, the Company shall not be able to
issue $1.00 of additional Indebtedness pursuant to paragraph (a) of
Section 4.04; or
(c) such Restricted Payment, together with the aggregate of
all other Restricted Payments made after the Issue Date, without
duplication, exceeds the sum of (1) 50% of the aggregate
Consolidated Net Income (including, for this purpose, gains or
losses from Asset Sales) of the Company (or, in case such aggregate
is a loss, 100% of such loss) for the period (taken as one
accounting period) from January 1, 2004 and ended as of the
Company's most recently ended fiscal quarter at the time of such
Restricted Payment; plus (2) 100% of the aggregate net cash proceeds
and the fair market value of any property or securities (as
determined by the Board of Directors in good faith) received by the
Company from the issue or sale of Capital Stock or other Equity
Interests of the Company subsequent to the Issue Date (other than
(w) Capital Stock or other Equity Interests issued or sold to a
Restricted Subsidiary, (x) the issuance or sale of Disqualified
Stock, (y) the Capital Stock of NYCOR North America, Inc. and its
Subsidiaries contributed to the Company and (z) other than Excess
Proceeds contributed to the Company for purposes of making an Asset
Sale Offer in accordance with Section 4.05; plus (3) the amount by
which the principal amount of and any accrued interest on either (A)
Indebtedness of the Company or (B) any Indebtedness of any
Restricted Subsidiary is reduced on the Company's consolidated
balance sheet upon the conversion or exchange other than by a
Restricted Subsidiary subsequent to the Issue Date of any
Indebtedness of the Company or any Restricted Subsidiary (not held
by the Company or any Restricted Subsidiary) for Capital Stock or
other Equity Interests (other than Disqualified Stock) of the
Company (less the amount of any cash, or the fair market value of
any other property or securities (as determined by the Board of
Directors in good faith), distributed by the Company or any
Restricted Subsidiary (to Persons other than the Company or any
other Restricted Subsidiary) upon such conversion or exchange); plus
(4) if any Non-Restricted Subsidiary is redesignated as a Restricted
Subsidiary, the value of the Restricted Payment that would result if
such Subsidiary were redesignated as a Non-Restricted Subsidiary at
such time, as determined in accordance with Section 4.16(b).
Notwithstanding the foregoing, paragraphs (b) and (c) shall
not prohibit as Restricted Payments:
(i) the payment of any dividend within 60 days after the
date of declaration thereof, if at said date of declaration, such
payment would comply with all covenants of this Indenture
(including, but not limited to, this Section 4.06); provided that
payments made pursuant to this paragraph shall count as a Restricted
Payment for purposes of the calculation in paragraph (c) of this
Section 4.06;
(ii) payments to Fedders Corporation in an amount equal to
the amount of income tax that the Company would have paid had it
filed consolidated tax returns on a separate company basis in any
given tax year; provided that payments made pursuant to this
paragraph (ii) shall not count as a Restricted Payment for purposes
of the calculation in paragraph (c) of this Section 4.06;
(iii) cash dividends or loans from the Company to Fedders
Corporation pursuant to the Services Agreement but in no event
exceeding 4% of the revenues of the Company and its Restricted
Subsidiaries for the immediately preceding four fiscal quarters;
provided, that payments made pursuant to this paragraph (iii) shall
not count as a Restricted Payment for purposes of the calculation
in paragraph (c) of this Section 4.06;
(iv) the redemption, repurchase, retirement or other
acquisition of any Capital Stock or other Equity Interests of the
Company or any Restricted Subsidiary in exchange for, or out of the
proceeds of, the substantially concurrent sale (other than to a
Subsidiary of the Company) of other Capital Stock or other Equity
Interests of the Company (other than any Disqualified Stock) or the
redemption, repurchase, retirement or other acquisition of any
Capital Stock or other Equity Interests of any Restricted Subsidiary
in exchange for, or out of the proceeds of, the substantially
concurrent sale (other than to the Company or a Subsidiary of the
Company) of other Capital Stock or other Equity Interests of such
Restricted Subsidiary; provided that, in each case, any net cash
proceeds that are utilized for any such redemption, repurchase,
retirement or other acquisition, and any Net Income resulting
therefrom, shall be excluded from paragraph (c) of this Section
4.06;
(v) Restricted Investments made or received in connection
with the sale, transfer or disposition of any business, properties
or assets of the Company or any Restricted Subsidiary; provided
that, if such sale, transfer or disposition constitutes an Asset
Sale, the Company complies with the provisions of Section 4.05, and
such Restricted Investments shall not count as a Restricted Payment
for purposes of the calculation in paragraph (c) of this Section
4.06;
(vi) the payment of a dividend to Fedders Corporation in
order to allow Fedders Corporation to pay its regular quarterly
dividend in respect of Fedders Corporation's Series A Cumulative
Preferred Stock, Common Stock and Class B Stock; provided that
payments made pursuant to this paragraph (vi) shall count as a
Restricted Payment for purposes of the calculation in paragraph (c)
of this Section 4.06;
(vii) dividends or other Restricted Payments made to Fedders
Corporation or any of its Subsidiaries to the extent such amounts
are used to make an Investment in any Subsidiary of Fedders
Corporation; provided that (A) the primary business of such
Subsidiary is a Related Business and (B) the amount of such dividend
or other Restricted Payment, when taken together with the aggregate
amount of other dividends and Restricted Payments made pursuant to
this clause (vii), does not exceed $30,000,000, provided further
that amounts paid pursuant to this clause (vii) shall not count as a
Restricted Payment for purposes of the calculation in paragraph (c)
of this Section 4.06;
(viii) any cash advances or loans to Fedders Corporation or
any Non-FNA Subsidiaries made in connection with ordinary course of
business cash management practices of Fedders Corporation and its
Subsidiaries; provided that amounts paid pursuant to this clause
(viii) shall not count as a Restricted Payment for purposes of the
calculation in paragraph (c) of this Section 4.06;
(ix) dividends or other Restricted Payments to Fedders
Corporation or any of its Subsidiaries with the Net Proceeds from
the disposition of the Walkersville, Maryland property owned by
Rotorex Company, Inc. on the Issue Date to the extent such amounts
are used to make an Investment in any Subsidiary of Fedders
Corporation; provided that (A) the primary business of such
Subsidiary is a Related Business and (B) amounts paid pursuant to
this clause (ix) shall not count as a Restricted Payment for purposes
of the calculation in paragraph (c) of this Section 4.06;
(x) one or more dividends or other distributions to Fedders
Corporation to the extent they consist of the Capital Stock of or
other Equity Interests in each of FNA Mauritius Co., Inc., Fedders
Shanghai Co., Ltd., Fedders Indoor Air Quality (Suzhou) Co., Ltd.,
Xi'an Fedders Xxxx Xxxx Air Conditioner Compressor Co., Ltd. and
Quanzhou Melcor Xxx Xx Thermoelectric Co., Ltd.; provided, however,
that (A) prior to the payment of such dividends neither the Company
nor any Subsidiary Guarantor shall have contributed or otherwise
transferred to any such persons any material assets other than in
the ordinary course of business consistent with past practice, (B)
substantially concurrent with such dividend or other distribution,
Fedders Corporation contributes such Capital Stock to Fedders
International or one of its Subsidiaries and (C) such dividends
shall not count as Restricted Payments for purposes of the
calculation in paragraph (c) of this Section 4.06; and
(xi) Restricted Payments in an amount which, when taken
together with all Restricted Payments pursuant to this clause (xi)
and then outstanding, does not exceed $15,000,000; provided that
payments made pursuant to this paragraph (xi) shall count as a
Restricted Payment for purposes of the calculation in paragraph (c)
of this Section 4.06.
Fedders Corporation shall not directly or indirectly declare
or pay any cash dividend or make any cash distribution on account of Fedders
Corporation's Capital Stock or other Equity Interests with the proceeds of a
Disqualified Distribution.
SECTION 4.07. Corporate Existence. Subject to Article Five,
the Company and Fedders Corporation shall do or shall cause to be done all
things necessary to preserve and keep in full force and effect their
respective corporate existence and the corporate, partnership or other
existence of each Restricted Subsidiary in accordance with the respective
organizational documents of each of them (as the same may be amended from time
to time) and the rights (charter and statutory) and material franchises of the
Company, Fedders Corporation and the Restricted Subsidiaries; provided,
however, that the Company and Fedders Corporation shall not be required to
preserve any such right or franchise, or the corporate existence of any
Restricted Subsidiary, if the Board of Directors or the board of directors of
Fedders Corporation shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company, Fedders Corporation
and the Restricted Subsidiaries, taken as a whole, and that the loss thereof
is not, and will not be, adverse in any material respect to the Holders.
SECTION 4.08. Payment of Taxes and Other Claims. The Company
and Fedders Corporation shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all material taxes,
assessments and governmental charges levied or imposed upon the Company,
Fedders Corporation or any Restricted Subsidiary or upon the income, profits
or property of the Company, Fedders Corporation or any Restricted Subsidiary
and (2) all lawful claims for labor, materials and supplies which, in each
case, if unpaid, might by law become a material liability, or Lien upon the
property, of the Company, Fedders Corporation or any Restricted Subsidiary;
provided, however, that neither the Company nor Fedders Corporation shall be
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings and for which appropriate
provision has been made.
SECTION 4.09. Notice of Defaults. (a) In the event that any
Indebtedness of the Company, Fedders Corporation or any of their Subsidiaries
is declared due and payable before its maturity because of the occurrence of
any default (or any event which, with notice or lapse of time, or both, would
constitute such a default) under such Indebtedness, the Company or Fedders
Corporation shall promptly give written notice to the Trustee of such
declaration, the status of such default or event and what action the Company
or Fedders Corporation is taking or proposes to take with respect thereto.
(b) Upon becoming aware of any Default or Event of Default,
the Company or Fedders Corporation shall promptly deliver an Officers'
Certificate to the Trustee specifying the Default or Event of Default.
SECTION 4.10. Maintenance of Properties and Insurance. (a)
The Company and Fedders Corporation shall cause all material properties owned
by or leased to either of them or any Restricted Subsidiary and used or useful
in the conduct of their business or the business of any Restricted Subsidiary
to be maintained and kept in normal condition, repair and working order and
supplied with all necessary equipment and shall cause to be made all necessary
repairs, renewals, replacements, betterments and improvements thereof, all as
in the judgment of the Company or Fedders Corporation may be necessary, so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
Section 4.10 shall prevent the Company, Fedders Corporation or any Restricted
Subsidiary from discontinuing the use, operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal
is, in the judgment of the Board of Directors or of the board of directors of
Fedders Corporation or the Restricted Subsidiary concerned, or of an officer
(or other agent employed by the Company, Fedders Corporation or any Restricted
Subsidiary) of the Company, Fedders Corporation or such Restricted Subsidiary
having managerial responsibility for any such property, desirable in the
conduct of the business of the Company, Fedders Corporation or any Restricted
Subsidiary, and if such discontinuance or disposal is not adverse in any
material respect to the Holders.
(b) The Company and Fedders Corporation shall maintain, and
shall cause the Restricted Subsidiaries to maintain, insurance with
responsible carriers against such risks and in such amounts, and with such
deductibles, retentions, self-insured amounts and co-insurance provisions, as
are customarily carried by similar businesses of similar size, including
property and casualty loss, and workers' compensation insurance.
SECTION 4.11. Compliance Certificate. The Company shall
deliver to the Trustee within 90 days after the close of each fiscal year a
certificate signed by the principal executive officer, principal financial
officer or principal accounting officer stating that a review of the
activities of the Company has been made under the supervision of the signing
officer with a view to determining whether a Default or Event of Default has
occurred and whether or not the signer knows of any Default or Event of
Default by the Company that occurred during such fiscal year. If the signer
knows of such a Default or Event of Default, the certificate shall describe
all such Defaults or Events of Default, their status and the action the
Company is taking or proposes to take with respect thereto.
SECTION 4.12. Provision of Financial Information. For so
long as the Securities are outstanding, whether or not Fedders Corporation or
any successor thereto is subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, Fedders Corporation shall submit for filing with
the Commission the annual reports, quarterly reports and other documents
relating to Fedders Corporation and its Subsidiaries that Fedders Corporation
and its Subsidiaries would have been required to file with the Commission
pursuant to Section 13 or 15(d) if Fedders Corporation and its Subsidiaries
were subject to such reporting requirements. Fedders Corporation will also
provide to all holders of Securities and file with the Trustee copies of such
annual reports, quarterly reports and other documents required to be furnished
to stockholders generally under the Exchange Act.
Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of the Trustee of any information
contained therein or determinable from information contained therein,
including the Company's compliance with any of its covenants hereunder (as to
which the Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 4.13. Waiver of Stay, Extension or Usury Laws. The
Company and the Guarantors covenant (to the extent that they may lawfully do
so) that they shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension
law or any usury law or other law, which would prohibit or forgive the Company
or such Guarantor from paying all or any portion of the principal of and/or
interest, if any, on the Securities as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the performance of
this Indenture; and (to the extent that they may lawfully do so) each of the
Company and the Guarantors hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been
enacted.
SECTION 4.14. Change of Control. Following the occurrence of
a Change of Control (the date of such occurrence being the "Change of Control
Trigger Date"), the Company shall notify the Holders of the Securities of such
occurrence in the manner prescribed by this Indenture and shall, within 30
days after the Change of Control Trigger Date, make an offer (the "Change of
Control Offer") to purchase all Securities then outstanding at a purchase
price in cash equal to 101% of the aggregate principal amount thereof, plus
accrued and unpaid interest and Additional Interest thereon, if any, to the
date (the "Change of Control Purchase Date") the Securities tendered are
purchased and paid for in accordance with this Section 4.14. The Company shall
furnish to the Trustee, at least 14 days before notice of a Change of Control
Offer is mailed to all holders of Securities, notice that the Change of
Control Offer is being made. Within 30 days following any Change of Control
Trigger Date, the Company shall mail a notice to each Holder of Securities at
such Holder's registered address stating:
(i) that a Change of Control Offer is being made pursuant to
a Change of Control Trigger Date, the length of time the Change of
Control Offer shall remain open and that all Securities tendered for
payment will be accepted for payment, and otherwise subject to the
terms and conditions set forth therein;
(ii) the purchase price, the amount of accrued and unpaid
interest as of the Change of Control Purchase Date, and the Change
of Control Purchase Date (which shall be no earlier than 30 days and
no later than 60 days from the date such notice is mailed);
(iii) that any Security not tendered will continue to accrue
interest;
(iv) that any Security accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest on and after
the Change of Control Purchase Date;
(v) that Holders accepting the Change of Control Offer will
be required to surrender the Securities to the Paying Agent
specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Purchase Date;
(vi) that Holders will be entitled to withdraw their
acceptance if the Paying Agent receives, not later than the close of
business on the third Business Day preceding the Change of Control
Purchase Date, a facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Securities delivered
for purchase and a statement that such Holder is withdrawing his
election to have such Securities purchased;
(vii) that Holders whose Securities are being purchased only
in part will be issued new Securities equal in principal amount to
the unpurchased portion of the Securities surrendered;
(viii) any other procedures that a Holder must follow to
accept a Change of Control Offer or effect withdrawal of such
acceptance; and
(ix) the name and address of the Paying Agent.
On the Change of Control Purchase Date, the Company will, to
the extent required by this Indenture and the Change of Control Offer, (1)
accept for payment all Securities or portions thereof (subject to the
requirement that any portion of a Security tendered must be tendered in any
integral multiple $1,000 principal amount) tendered pursuant to the Change of
Control Offer; (2) deposit with the Paying Agent the aggregate purchase price
of all Securities or portions thereof accepted for payment and any accrued and
unpaid interest and Additional Interest, if any, on such Securities as of the
Change of Control Purchase Date, and (3) deliver or cause to be delivered to
the Trustee all Securities tendered pursuant to the Change of Control Offer.
The Paying Agent shall promptly mail to each holder of Securities or portions
thereof accepted for payment an amount equal to the purchase price for such
Securities plus any accrued and unpaid interest and Additional Interest, if
any, thereon, and the Trustee shall promptly authenticate and mail (or cause
to be transferred by book-entry) to such holder of Securities accepted for
payment in part a new Security equal in principal amount to any unpurchased
portion of the Securities and any Security not accepted for payment in whole
or in part shall be promptly returned to the holder thereof. The Company will
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Purchase Date.
The Company will comply with any tender offer rules under
the Exchange Act which may then be applicable, including Rule 14e-1, in
connection with a Change of Control Offer. To the extent that the provisions
of any securities laws or regulations conflict with provisions of this
Indenture, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under
this Indenture by virtue thereof.
SECTION 4.15. Limitations on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries. The Company shall not, and
shall not cause or permit any Restricted Subsidiary to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective,
any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary that is not a Subsidiary Guarantor to (a) pay dividends or make any
other distributions on its Capital Stock or any other interest or
participation in, or measured by, its profits, owned by the Company or any
Restricted Subsidiary, or pay any Indebtedness owed to, the Company or any
Restricted Subsidiary, (b) make loans or advances to the Company, or (c)
transfer any of its properties or assets to the Company, except for such
encumbrances or restrictions existing under or by reason of:
(i) any agreement, obligation or instrument in effect on the
Issue Date, and any amendment, restatement or extension of such
agreement, obligation or instrument to the extent such encumbrances
or restrictions are not materially more restrictive to the
Securityholders than those in effect on the Issue Date;
(ii) Indebtedness permitted (A) under paragraph (a) of
Section 4.04, (B) under clauses (i) or (iii) of paragraph (b) of
Section 4.04 or clauses (i), (v), (vi) or (viii) of the definition
of Other Permitted Indebtedness, or (C) by agreements and
transactions permitted under Section 4.06;
(iii) customary provisions restricting subletting or
assignment of any lease or license of the Company or any Restricted
Subsidiary;
(iv) any instrument governing Indebtedness or any other
encumbrance or restriction of a Person acquired by the Company or
any Restricted Subsidiary at the time of such acquisition, which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired;
(v) the Credit Agreement;
(vi) any Refinancing Indebtedness permitted under Section
4.04 or clauses (i), (v) or (viii) of the definition of Other
Permitted Indebtedness; provided that the encumbrances and
restrictions created in connection with such Refinancing
Indebtedness are no more restrictive in any material respect with
regard to the interests of the Holders of Securities than the
encumbrances and restrictions in the refinanced Indebtedness;
(vii) the Existing Notes; or
(viii) the terms of purchase money obligations, but only to
the extent such purchase money obligations restrict or prohibit the
transfer of the property so acquired.
Nothing contained in this Section 4.15 shall prevent the
Company from entering into any agreement or instrument providing for the
incurrence of Permitted Liens or restricting the sale or other disposition of
property or assets of the Company or any of its Restricted Subsidiaries that
are subject to Permitted Liens.
SECTION 4.16. Designation of Restricted and Non-Restricted
Subsidiaries. (a) As of the date of this Indenture, Trion, Inc., Envirco
Corporation, Melcor Corporation, Xxxxxx Manufacturing Enterprises, Inc.,
Xxxxxxx Quiet Kool Corporation, Fedders Inc., Columbia Specialties, Inc.,
Rotorex Company, Inc. and Fedders Outlet, Inc. shall be Restricted
Subsidiaries. Subject to the exceptions described below, from and after the
Issue Date, the Company may designate any existing or newly formed or acquired
Subsidiary as a Non-Restricted Subsidiary; provided that either (i) the
Subsidiary to be so designated has total assets of $1,000,000 or less or (ii)
immediately before and after giving effect to such designation: (I) the
Company could incur $1.00 of additional Indebtedness pursuant to paragraph (a)
of Section 4.04 determined on a Pro Forma Basis; (II) no Default or Event of
Default shall have occurred and be continuing; (III) all Investments made by
the Company or by a Restricted Subsidiary of the Company in such Restricted
Subsidiary which is being designated a Non-Restricted Subsidiary prior to or
on the date such Restricted Subsidiary is being designated a Non-Restricted
Subsidiary shall have been permitted pursuant to Section 4.06 as if all of
such Restricted Payments had been made on the day such Restricted Subsidiary
is designated a Non-Restricted Subsidiary (to the extent not previously
included as a Restricted Payment) in the amount of the greater of (A) the fair
market value (as determined by the Board of Directors in good faith) of the
Equity Interests of such Subsidiary held by the Company and its Restricted
Subsidiaries on such date or (B) the amount of the Investments determined in
accordance with GAAP made by the Company and any of its Restricted
Subsidiaries in such Restricted Subsidiary; and (IV) all transactions between
the Subsidiary to be so designated and its Affiliates remaining in effect are
permitted pursuant to Section 4.03.
(b) The Company may redesignate any Non-Restricted
Subsidiary as a Restricted Subsidiary. The Company may not, and may not permit
any Restricted Subsidiary to, take any action or enter into any transaction or
series of transactions that would result in a Person becoming a Restricted
Subsidiary (whether through an acquisition, the redesignation of a
Non-Restricted Subsidiary or otherwise, but not including through the creation
of a new Restricted Subsidiary) unless, immediately before and after giving
effect to such action, transaction or series of transactions, (i) the Company
could incur at least $1.00 of additional Indebtedness pursuant to paragraph
(a) of Section 4.04 on a Pro Forma Basis and (ii) no Default or Event of
Default shall have occurred and be continuing.
(c) The designation of a Subsidiary as a Restricted
Subsidiary or the removal of such designation shall be made by a resolution
adopted by a majority of the Board of Directors stating that the Board of
Directors has made such designation in accordance with this Indenture, and the
Company shall deliver to the Trustee such resolution together with an
Officers' Certificate certifying that the designation complies with this
Indenture. Such designation will be effective as of the date specified in the
applicable resolution which may not be before the date the applicable
Officers' Certificate is delivered to the Trustee.
SECTION 4.17. Limitation on Liens. The Company shall not,
and shall not cause or permit any Restricted Subsidiary to, directly or
indirectly, create, incur, assume or suffer to exist any Lien (other than
Permitted Liens) upon any property or asset now owned or hereafter acquired by
them, or any income or profits therefrom, or assign or convey any right to
receive income therefrom; provided, however, that in addition to creating
Permitted Liens on its properties or assets, the Company and any of the
Subsidiary Guarantors may create any Lien upon any of their properties or
assets (including, but not limited to, any Capital Stock of its Subsidiaries)
if the Securities are equally and ratably secured.
SECTION 4.18. Limitation on Sale and Leaseback Transactions.
The Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries to, enter into any sale and leaseback transaction; provided that
the Company and the Subsidiary Guarantors may enter into a sale and leaseback
transaction if (i) the Company or such Subsidiary Guarantor could have
incurred Indebtedness in an amount equal to the Attributable Debt relating to
such sale and leaseback transaction pursuant to the Company's Cash Flow
Coverage Ratio test set forth in paragraph (a) of Section 4.04, (ii) the net
cash proceeds of such sale and leaseback transaction are at least equal to the
fair market value (as determined in good faith by the Board of Directors and
set forth in an Officers' Certificate delivered to the Trustee) of the
property that is the subject of such sale and leaseback transaction and (iii)
the transfer of assets in such sale and leaseback transaction is permitted by,
and the proceeds of such transaction are applied in compliance with, Section
4.05.
SECTION 4.19. Future Guarantors. The Company shall not
permit any domestic Restricted Subsidiary to issue any Indebtedness (other
than Other Permitted Indebtedness) or any Foreign Subsidiary to guarantee any
Indebtedness (other than Indebtedness issued by another Foreign Subsidiary)
unless such Restricted Subsidiary contemporaneously executes and delivers a
supplemental indenture to the Trustee providing for a guarantee of payment of
the Securities then outstanding by such Restricted Subsidiary on the same
terms as a Subsidiary Guaranty; provided, however, that the provisions of this
Section 4.19 do not apply to guarantees by any Restricted Subsidiary of the
Company's Indebtedness under the Credit Agreement as in effect on the Issue
Date.
Each guarantee of the Securities created by a Restricted
Subsidiary pursuant to the provisions described in the foregoing paragraph
shall be in form and substance satisfactory to the Trustee and shall provide,
among other things, that it will be automatically and unconditionally released
and discharged upon (i) any sale, exchange or transfer permitted by this
Indenture of (a) all of the Company's Capital Stock in such Restricted
Subsidiary or (b) the sale of all or substantially all of the assets of the
Restricted Subsidiary and upon the application of the Net Proceeds from such
sale in accordance with the requirements of Section 4.05 or (ii) the release
or discharge of the Other Company Indebtedness Guarantee that resulted in the
creation of such guarantee of the Securities.
ARTICLE V
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidation and Sale of Assets. (a)
Each of the Company and Fedders Corporation shall not consolidate or merge
with or into, or sell, lease, convey or otherwise dispose of all or
substantially all of its assets to, any Person (any such consolidation, merger
or sale being a "Disposition") unless: (i) the- successor corporation of such
Disposition (if other than Fedders Corporation or the Company) or the
corporation to which such Disposition shall have been made is a corporation
organized or existing under the laws of the United States, any state thereof
or the District of Columbia; (ii) the successor corporation of such
Disposition or the corporation to which such Disposition shall have been made
expressly assumes the Obligations of the Company or Fedders Corporation, as
the case may be, pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee, under this Indenture and the Securities; (iii)
immediately after such Disposition, no Default or Event of Default shall
exist; and (iv) the corporation formed by or surviving any such Disposition,
or the corporation to which such Disposition shall have been made, shall be
permitted immediately after the Disposition by the terms of the Indenture to
issue at least $1.00 of additional Indebtedness pursuant to paragraph (a) of
Section 4.04 determined on a Pro Forma Basis; provided, however, that this
clause (iv) will not be applicable to a merger of NYCOR North America, Inc.
with and into the Company. The limitations in this Indenture on the Company's
ability to make a Disposition described in this paragraph (a) do not restrict
the Company's ability to sell less than all or substantially all of its
assets, such sales being governed by Section 4.05.
(b) Prior to the consummation of any proposed Disposition,
the Company shall deliver to the Trustee an Officers' Certificate to the
foregoing effect and an Opinion of Counsel stating that the proposed
Disposition and such supplemental indenture comply with this Indenture.
(c) Each Subsidiary Guarantor shall not consolidate or merge
with or into, or sell, lease, convey, or otherwise dispose of all or
substantially all of its assets to any Person unless: (i) except in the case
of a Subsidiary Guarantor (x) that has been disposed of in its entirety to
another Person (other than to the Company or an Affiliate of the Company),
whether through a merger, consolidation or sale of Capital Stock or assets or
(y) that, as a result of the disposition of all or a portion of its Capital
Stock, ceases to be a Subsidiary, in both cases, if in connection therewith
the Company provides an Officers' Certificate to the Trustee to the effect
that the Company will comply with its obligations under Section 4.05 in
respect of such disposition, the resulting, surviving or transferee Person (if
not such Subsidiary) shall be a Person organized and existing under the laws
of the jurisdiction under which such Subsidiary was organized or under the
laws of the United States of America, or any state thereof or the District of
Columbia, and such Person shall expressly assume, by a Guaranty Agreement, in
a form satisfactory to the Trustee, all the obligations of such Subsidiary, if
any, under its Subsidiary Guaranty; (ii) immediately after giving effect to
such transaction or transactions on a Pro Forma Basis (and treating any
Indebtedness which becomes an obligation of the resulting, surviving or
transferee Person as a result of such transaction as having been issued by
such Person at the time of such transaction), no Default shall have occurred
and be continuing; and (iii) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger or transfer and such Guaranty Agreement, if any, comply with this
Indenture.
SECTION 5.02. Successor Corporation Substituted. In the
event of any Disposition of the Company or the Guarantors in accordance with
Section 5.01, the successor corporation formed by such consolidation or into
which the Company or the Guarantors are merged or to which such Disposition
are made shall succeed to, and be substituted for, and may exercise every
right and power of, the Company or the Guarantors, as applicable, under this
Indenture with the same effect as if such successor corporation had been named
as the Company or a Guarantor herein, and thereafter the predecessor
corporation shall be relieved of all Obligations and covenants under this
Indenture and the Securities.
ARTICLE VI
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default. Each of the following shall
be an "Event of Default" for purposes of this Indenture:
(i) a default for 30 days in payment of interest or
Additional Interest, if any, on the Securities;
(ii) a default in payment when due of principal or premium,
if any, with respect to the Securities;
(iii) failure by the Company, Fedders Corporation or any
Subsidiary Guarantor, as the case may be, to comply with the
provisions of Section 4.04, 4.06, 4.14, 4.19 or 5.01;
(iv) the failure of the Company, Fedders Corporation or any
Subsidiary Guarantor to comply with any of its other agreements or
covenants in, or provisions of, this Indenture or the Securities,
which failure is not cured within thirty days after receipt of the
notice and demand for cure sent to the Company by the Trustee or
Holders of at least 25% in principal amount of the Securities then
outstanding;
(v) a default by the Company, Fedders Corporation or any
Restricted Subsidiary under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any
Restricted Subsidiary (or the payment of which is guaranteed by the
Company or any Restricted Subsidiary), whether such Indebtedness or
guarantee now exists or shall be created hereafter, if (I) either
(A) such default results from the failure to pay principal of or
interest on any such Indebtedness (after giving effect to any
extensions thereof) or (B) as a result of such default the maturity
of such Indebtedness has been accelerated prior to its expressed
maturity, and (II) the principal amount of such Indebtedness,
together with the principal amount of any other such Indebtedness in
default for failure to pay principal or interest thereon, or,
because of the acceleration of the maturity thereof, aggregates in
excess of $10,000,000;
(vi) a failure by the Company or any Restricted Subsidiary
to pay final judgments (not covered by insurance) aggregating in
excess of $10,000,000 which judgments a court of competent
jurisdiction does not rescind, annul or stay within 45 days after
their entry;
(vii) the Company, Fedders Corporation or any Significant
Subsidiary pursuant to or within the meaning of any Bankruptcy Law:
(I) commences a voluntary case, (II) consents to the entry of an
order for relief against it in an involuntary case, (III) consents
to the appointment of a Custodian of it or for all or substantially
all of its property, (IV) makes a general assignment for the benefit
of its creditors or (V) generally is not paying its debts as they
become due;
(viii) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that: (I) is for relief against the
Company, Fedders Corporation or any Significant Subsidiary in an
involuntary case, (II) appoints a Custodian of the Company, Fedders
Corporation or any Significant Subsidiary or for all or
substantially all of the property of the Company, Fedders
Corporation or any Significant Subsidiary, or (III) orders the
liquidation of the Company, Fedders Corporation or any Significant
Subsidiary, and the order or decree remains unstayed and in effect
for 60 days; and
(ix) the failure of the Guarantee of Fedders Corporation or
of any Subsidiary Guarantor that is a Significant Subsidiary to be
in full force and effect (other than in accordance with the terms of
such Guarantee) or the denial or disaffirmation by Fedders
Corporation or any Subsidiary Guarantor that is a Significant
Subsidiary of its obligations under its Guarantee, and such failure,
denial or disaffirmation continues for 10 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under
any Bankruptcy Law.
In the case of any Event of Default pursuant to paragraph
(i) or (ii) above occurring by reason of any willful action (or inactions)
taken (or not taken) by or on behalf of the Company with the intention of
avoiding payment of the premium that the Company would have to pay pursuant to
a redemption of Securities as described under Article Three, an equivalent
premium shall also become and be immediately, due and payable to the extent
permitted by law.
SECTION 6.02. Acceleration. If an Event of Default with
respect to the Securities occurs and is continuing, the Trustee or the Holders
of at least 25 % in aggregate principal amount of the outstanding Securities
may declare the unpaid principal of and accrued interest and Additional
Interest, if any, to the date of acceleration on all outstanding Securities to
be due and payable immediately by notice in writing to the Company (and to the
Trustee if given by the Holders) specifying the respective Event of Default
and that it is a "notice of acceleration" (the "Acceleration Notice") and,
upon any such declaration, such principal amount and accrued interest and
Additional Interest, if any, notwithstanding anything contained in this
Indenture or the Securities to the contrary, shall become immediately due and
payable.
A Default or Event of Default under paragraph (vii) or
(viii) will result in the Securities automatically becoming due and payable
without further action or notice.
After a declaration of acceleration, but before a judgment
or decree of the money due in respect of the Securities has been obtained, the
Holders of not less than a majority in aggregate principal amount of the
Securities then outstanding by written notice to the Trustee may rescind an
acceleration and its consequences if all existing Events of Default (other
than the nonpayment of principal of and interest and Additional Interest, if
any, on the Securities which has become due solely by virtue of such
acceleration) have been cured or waived and if the rescission would not
conflict with any judgment or decree. No such rescission shall affect any
subsequent Default or impair any right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs
and is continuing, the Trustee may pursue any available remedy by proceeding
at law or in equity to collect the payment of principal of or interest and
Additional Interest, if any, on the Securities or to enforce the performance
of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the
proceeding. A delay or omission by the Trustee or any Securityholder in
exercising any right or remedy maturing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative to the extent permitted by law.
SECTION 6.04. Waiver of Past Default. Subject to Sections
2.09, 6.07 and 9.02, prior to the declaration of acceleration of the
Securities, the Holders of not less than a majority in aggregate principal
amount of the outstanding Securities by written notice to the Trustee may
waive an existing Default or Event of Default and its consequences, except a
continuing Default in the payment of principal of or premium, if any, or
interest or Additional Interest, if any, on any Security or a Default in
respect of any term or provision of this Indenture that may not be amended or
modified without the consent of each Holder affected as provided in Section
9.02 (and except for any failure to pay any amount owing to the Trustee, or
waiver of any covenant or other provision for the personal protection of the
Trustee, without the Trustee's consent). The Company shall deliver to the
Trustee an Officers' Certificate stating that the requisite percentage of
Holders have consented to such waiver and attaching copies of such consents.
In case of any such waiver, the Company, the Trustee and the Holders shall be
restored to their former positions and rights hereunder and under the
Securities, respectively. This paragraph of this Section 6.04 shall be in lieu
of ss. 316(a)(1)(B) of the TIA and such ss. 316(a)(1)(B) of the TIA is hereby
expressly excluded from this Indenture and the Securities, as permitted by the
TIA.
Upon any such waiver, such Default shall cease to exist and
be deemed to have been cured and not to have occurred, and any Event of
Default arising therefrom shall be deemed to have been cured and not to have
occurred for every purpose of this Indenture and the Securities, but no such
waiver shall extend to any subsequent or other Default or Event of Default or
impair any right consequent thereon.
SECTION 6.05. Control by Majority. Subject to Section 2.09,
the Holders of a majority in principal amount of the outstanding Securities
may direct the time, method and place of conducting any proceeding for 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 conflicts
with law or this Indenture, that the Trustee determines may be unduly
prejudicial to the rights of another Securityholder, or that may involve the
Trustee in personal liability; provided, however, that the Trustee may take
any other action deemed proper by the Trustee which is not inconsistent with
such direction. In the event the Trustee takes any action or follows any
direction pursuant to this Indenture, the Trustee shall be entitled to
indemnification satisfactory to it in its sole discretion against any loss or
expense caused by taking such action or following such direction. This Section
6.05 shall be in lieu of ss. 316(a)(1)(A) of the TIA, and such ss.
316(a)(1)(A) of the TIA is hereby expressly excluded from this Indenture and
the Securities, as permitted by the TIA.
SECTION 6.06. Limitation on Suits. A Securityholder may not
pursue any remedy with respect to this Indenture or the Securities unless:
(i) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal
amount of the outstanding Securities make a written request to the
Trustee to pursue a remedy;
(iii) such Holder or Holders offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(iv) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested,
the provision of indemnity; and
(v) during such 60-day period the Holders of a majority in
principal amount of the outstanding Securities do not give the
Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
such other Securityholder.
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of principal of or interest or Additional Interest, if any,
on a Security, on or after the respective due dates expressed in the Security,
or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of the
Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of
Default in payment of principal or premium, if any, or interest or Additional
Interest, if any, specified in Section 6.01(i) or (ii) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company or the Guarantors or any other obligor on
the Securities for the whole amount of principal and premium, if any, and
accrued interest remaining unpaid, and Additional Interest, if any, together
with interest overdue on principal and to the extent that payment of such
interest is lawful, interest on overdue installments of interest, in each case
at the rate per annum borne by the Securities 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
may 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 Securityholders
allowed in any judicial proceedings relative to the Company or the Guarantors
(or any other obligor upon the Securities), any of their respective creditors
or any of their respective property and shall be entitled and empowered to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same, and any Custodian in any such judicial
proceedings is hereby authorized by each Securityholder 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 Securityholders, 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. Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf
of any Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or
to authorize the Trustee to vote in respect of the claim of any Securityholder
in any such proceeding.
SECTION 6.10. Priorities. If the Trustee collects any money
or property pursuant to this Article Six, it shall pay out the money or
property in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for amounts due and unpaid on the
Securities for principal, premium, if any, or Additional Interest, if any, and
interest, ratably, without preference or priority of any kind, according to
the amounts due and payable on the Securities for principal and interest,
respectively; and
Third: to the Company or, to the extent the Trustee collects
any amount from a Guarantor, to such Guarantor.
The Trustee, upon prior written notice to the Company, may
fix a record date and payment date for any payment to Securityholders 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 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 and expenses,
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 shall not apply to a suit by the Trustee, a suit by a Holder or group of
Holders of more than 10% in aggregate principal amount of the outstanding
Securities, or to any suit instituted by any Holder for the enforcement or the
payment of the principal of or interest or premium or Additional Interest, if
any, on any Securities on or after the respective due dates expressed in the
Security.
ARTICLE VII
TRUSTEE
SECTION 7.01. Duties of Trustee. (a) If a Default has
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture and use the same degree of care and
skill in their exercise as a prudent Person would exercise or use under the
circumstances in the conduct of his own affairs.
(b) Except during the continuance of a Default:
(1) The Trustee shall not be liable except for the
performance of such duties as are specifically set forth herein; 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 conforming to the requirements of this Indenture; however,
in the case of any such certificates or opinions which by any
provision hereof are specifically required to be furnished to the
Trustee, the Trustee shall examine such certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee shall not be relieved from liability 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 shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
(3) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or to take or omit to take any
action under this Indenture or take any action at the request or direction of
Holders if it shall have reasonable grounds for believing that repayment of
such funds is not assured to it or it does not receive from such Holders an
indemnity satisfactory to it in its sole discretion against such risk,
liability, loss, fee or expense which might be incurred by it in compliance
with such request or direction.
(e) Every provision of this Indenture that in any way
relates to the Trustee is subject to paragraphs (a), (b), (c) and (d) of this
Section 7.01.
(f) The Trustee shall 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.
SECTION 7.02. Rights of Trustee. Subject to Section 7.01:
(a) The Trustee may rely on any document believed by it to
be genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate and/or an Opinion of Counsel, which shall
conform to the provisions of Section 11.05. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through attorneys and agents of its
selection and shall not be responsible for the misconduct or negligence of any
agent or attorney (other than an agent who is an employee of the Trustee)
appointed with due care.
(d) The Trustee shall not be liable for any action it takes
or omits to take in good faith which it reasonably believes to be authorized
or within its rights or powers.
(e) The Trustee may consult with counsel and the advice or
opinion of such counsel as to matters of law shall be full and complete
authorization and protection from liability in respect of any action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.
(f) Any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order and any
request or direction of the Guarantors mentioned herein shall be sufficiently
evidenced if signed by an officer of such Guarantor.
(g) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Securityholders pursuant to this Indenture, unless
such Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be incurred
by it in compliance with such request or direction.
(h) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, security, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company or
the Guarantors, personally or by agent or attorney.
(i) The Trustee shall not be deemed to have notice of any
Event of Default unless a Trust Officer of the Trustee has actual knowledge
thereof or unless the Trustee shall have received written notice thereof at
the Corporate Trust Office of the Trustee, and such notice references the
Securities and this Indenture.
(j) Permissive rights or powers available to the Trustee
hereunder shall not be assumed to be mandatory duties or obligations.
SECTION 7.03. Individual Rights of Trustee. The Trustee in
its individual or any other capacity may become the owner or pledgee of
Securities and may otherwise deal with the Company or its Affiliates with the
same rights it would have if it were not Trustee, subject to Section 7.10
hereof. Any Agent may do the same with like rights. However, the Trustee is
subject to Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the
Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement of the Company or the Guarantors in this
Indenture or any document issued in connection with the sale of Securities or
any statement in the Securities other than the Trustee's certificate of
authentication.
SECTION 7.05. Notice of Defaults. The Company shall deliver
to the Trustee annually a statement regarding compliance with this Indenture
and, upon an Officer of the Company becoming aware of any Default or Event of
Default, a statement specifying such Default or Event of Default. If a Default
or an Event of Default occurs and is continuing and the Trustee knows of such
Default or Event of Default, the Trustee shall mail to each Securityholder
notice of the Default or Event of Default within 90 days after the occurrence
thereof. Except in the case of a Default or an Event of Default in payment of
principal of or premium, if any, or interest or Additional Interest, if any,
on any Security or a Default or Event of Default in complying with Section
5.01 hereof, 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 interest of Securityholders. This Section 7.05 shall be in lieu of the
proviso to ss. 315(b) of the TIA and such proviso to ss. 315(b) of the TIA is
hereby expressly excluded from this Indenture and the Securities, as permitted
by the TIA.
SECTION 7.06. Reports by Trustee to Holders. If required by
TIA ss. 313(a), within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, the Trustee shall mail to each
Securityholder a report dated as of such May 15 that complies with TIA ss.
313(a). The Trustee also shall comply with TIA ss. 313(b), (c) and (d).
A copy of each such report at the time of its mailing to
Securityholders shall be filed with the Commission and each stock exchange, if
any, on which the Securities are listed.
The Company shall promptly notify the Trustee in writing if
the Securities become listed on any stock exchange or of any delisting
thereof.
SECTION 7.07. Compensation and Indemnity. The Company and
the Guarantors jointly and severally shall pay to the Trustee from time to
time such compensation as the Company and the Trustee shall from time to time
agree in writing for its services, The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The
Company and the Guarantors shall reimburse the Trustee upon request for all
reasonable disbursements, expenses and advances (including fees, disbursements
and expenses of its agents and counsel) incurred or made by it in addition to
the compensation for its services except any such disbursements, expenses and
advances as may be attributable to the Trustee's negligence or bad faith. Such
expenses shall include the reasonable compensation, disbursements and expenses
of the Trustee's agents, accountants, experts and counsel and any taxes or
other expenses incurred by a trust created pursuant to Section 8.01 hereof.
The Company and the Guarantors jointly and severally shall
indemnify the Trustee for, and hold it harmless against any and all loss,
damage, claims, liability or expense, including taxes (other than franchise
taxes imposed on the Trustee and taxes based upon, measured by or determined
by the income of the Trustee), arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent that such loss, damage, claim, liability or
expense is due to its own negligence or bad faith. The Trustee shall notify
the Company promptly of any claim asserted against the Trustee for which it
may seek indemnity. However, the failure by the Trustee to so notify the
Company shall not relieve the Company or the Guarantors of their respective
obligations hereunder. The Company and the Guarantors shall defend the claim
and the Trustee shall cooperate in the defense (and may employ its own
counsel) at the Company's and the Guarantors' expense; provided, however, that
the Company's and the Guarantors' reimbursement obligation with respect to
counsel employed by the Trustee will be limited to the reasonable fees and
expenses of such counsel.
The Company and the Guarantors need not pay for any
settlement made without their written consent, which consent shall not be
unreasonably withheld. The Company and the Guarantors need not reimburse any
expense or indemnify against any loss or liability incurred by the Trustee as
a result of the violation of this Indenture by the Trustee.
To secure the Company's and the Guarantors' payment
obligations in this Section 7.07, the Trustee shall have a Lien prior to the
Securities against all money or property held or collected by the Trustee, in
its capacity as Trustee, except money or property held in trust to pay
principal of or premium, if any, or interest or Additional Interest, if any,
on particular Securities or the purchase price or redemption price of any
Securities to be purchased pursuant to an Asset Sale Offer or Change of
Control Offer or redeemed.
When the Trustee incurs expenses or renders services after
an Event of Default specified in Section 6.01(vii) or (viii) occurs, the
expenses (including the reasonable fees and expenses of its agents and
counsel) and the compensation for the services shall be preferred over the
status of the Holders in a proceeding under any Bankruptcy Law and are
intended to constitute expenses of administration under any Bankruptcy Law.
The Company's and the Guarantors' obligations under this Section 7.07 and any
claim arising hereunder shall survive the resignation or removal of any
Trustee, the discharge of the Company's and the Guarantors' obligations
pursuant to Article Eight and any rejection or termination under any
Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee may resign
at any time by so notifying the Company in writing. The Holders of a majority
in principal amount of the outstanding Securities may remove the Trustee by so
notifying the Trustee and the Company in writing and may appoint a successor
Trustee with the Company's consent. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent under
any Bankruptcy Law;
(3) a custodian or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists
in the office of Trustee for any reason (the Trustee in such event being
referred to herein as the retiring Trustee), the Company shall promptly
appoint a successor Trustee. Within one year after the successor Trustee takes
office, the Holders of a majority in principal amount of the Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
A successor Trustee shall deliver a written acceptance of
its appointment to the retiring Trustee and to the Company. As promptly as
practicable after that, the retiring Trustee shall transfer, after payment of
all sums then owing to the Trustee pursuant to Section 7.07, all property held
by it as Trustee to the successor Trustee, subject to the Lien provided in
Section 7.07, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have the rights, powers and duties
of the Trustee under this Indenture. A successor Trustee shall mail notice of
its succession to each Securityholder.
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 principal amount of the outstanding
Securities may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's and the Guarantors' obligations under Section 7.07
shall continue for the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc. If the
Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation or
banking corporation, the resulting, surviving or transferee corporation or
banking corporation without any further act shall be the successor Trustee.
SECTION 7.10. Eligibility; Disqualification. This Indenture
shall always have a Trustee which shall be eligible to act as Trustee under
TIA xx.xx. 310(a)(1) and 310(a)(2). The Trustee shall have a combined capital
and surplus of at least $50,000,000 as set forth in its most recent published
annual report of condition. If the Trustee has or shall acquire any
"conflicting interest" within the meaning of TIA ss. 310(b), the Trustee and
the Company shall comply with the provisions of TIA ss. 310(b); provided,
however, that there shall be excluded from the operation of TIA ss. 310(b)(1)
any indenture or indentures under which other securities or certificates of
interest or participation in other securities of the Company are outstanding
if the requirements for such exclusion set forth in TIA ss. 310(b)(1) are met.
If at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 7.10, the Trustee shall resign immediately in the
manner and with the effect hereinbefore specified in this Article Seven.
SECTION 7.11. Preferential Collection of Claims Against
Company. The Trustee shall comply with 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 VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Indenture. The Company and the
Guarantors may terminate their Obligations under the Securities, the
Guarantees and this Indenture, except the obligations referred to in the last
paragraph of this Section 8.01, if (a) the Company delivers to the Trustee all
outstanding Securities (other than any Securities that are asserted to have
been destroyed, lost or stolen and that have been replaced as provided in
Section 2.07) for cancellation or (b) all outstanding Securities have become
due and payable, whether at maturity or on a redemption date as a result of
the mailing of a notice of redemption pursuant to Article Three hereof and the
Company irrevocably deposits with the Trustee funds sufficient to pay at
maturity or upon redemption all outstanding Securities, including interest
thereon to maturity or such redemption date (other than any Securities that
are asserted to have been destroyed, lost or stolen and that have been
replaced as provided in Section 2.07) and to pay all other sums payable by it
hereunder.
After such delivery the Trustee upon request shall
acknowledge in writing the discharge of the Company's and the Guarantors'
Obligations under the Securities, the Guarantees and this Indenture except for
those surviving obligations specified below.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company and the Guarantors in Sections 7.07,
8.05 and 8.06 hereof shall survive.
SECTION 8.02. Legal Defeasance. The Company may at its
option, by resolution of the Board of Directors, be discharged from its
Obligations with respect to the Securities and the Guarantors discharged from
their Obligations under the Guarantees on the date the conditions set forth in
Section 8.04 below are satisfied (hereinafter, the "Legal Defeasance Option").
For this purpose, exercise of such Legal Defeasance Option means that the
Company shall be deemed to have paid and discharged the entire indebtedness
represented by the Securities and to have satisfied all its other Obligations
under such Securities and this Indenture insofar as such Securities are
concerned (and the Trustee, at the expense of the Company, shall, subject to
Section 8.06 hereof, execute proper instruments acknowledging the same),
except for the following which shall survive until otherwise terminated or
discharged hereunder: (A) the rights of Holders of outstanding Securities to
receive solely from the trust funds described in Section 8.04 hereof and as
more fully set forth in such Section, payments in respect of the principal of
and premium, if any, and interest and Additional Interest, if any, on such
Securities when such payments are due, (B) the Company's obligations with
respect to such Securities under Sections 2.03, 2.04 and 2.07, (C) the rights,
powers, trusts, duties, and immunities of the Trustee hereunder (including
claims of, or payments to, the Trustee under or pursuant to Section 7.07
hereof) and (D) this Article Eight. Subject to compliance with this Article
Eight, the Company may exercise its Legal Defeasance Option under this Section
8.02 with respect to the Securities notwithstanding the prior exercise of its
option under Section 8.03 below with respect to the Securities. If the Company
exercises its Legal Defeasance Option, payment of the Securities may not be
accelerated because of an Event of Default with respect thereto.
SECTION 8.03. Covenant Defeasance. At the option of the
Company, pursuant to a resolution of the Board of Directors, the Company and
the Guarantors shall be released from their respective Obligations under
Sections 4.03 through 4.06 and Sections 4.14 through 4.19, clauses (iii) and
(iv) of paragraph (a) of Section 5.01, and paragraphs (iii), (iv), (v) and
(vi) of Section 6.01, with respect to the outstanding Securities on and after
the date the conditions set forth in Section 8.04 hereof are satisfied
(hereinafter, "Covenant Defeasance Option"). For this purpose, exercise of
such Covenant Defeasance Option means that the Company and the Guarantors may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such specified Section or portion
thereof, whether directly or indirectly by reason of any reference elsewhere
herein to any such specified Section or portion thereof or by reason of any
reference in any such specified Section or portion thereof to any other
provision herein or in any other document, but the remainder of this Indenture
and the Securities shall be unaffected thereby. If the Company exercises the
Covenant Defeasance Option, payment of the Securities shall not be accelerated
because of an Event of Default specified in paragraphs (iii), (iv), (v), (vi)
or (ix) of Section 6.01 or because of the Company's failure to comply with
clauses (iii) and (iv) under paragraph (a) of Section 5.01.
SECTION 8.04. Conditions to Legal Defeasance or Covenant
Defeasance. The following shall be the conditions to application of Section
8.02 or Section 8.03 hereof to the outstanding Securities:
(1) the Company shall irrevocably have deposited or caused
to be deposited with the Trustee (or another trustee satisfying the
requirements of Section 7.10 who shall agree to comply with the
provisions of this Article Eight applicable to it) as funds in trust
(the "defeasance trust") for the purpose of making the following
payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of the Securities, (A) money in an
amount, or (B) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than the due
date of any payment, money in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally-recognized firm
of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee (or other
qualifying trustee) to pay and discharge, the principal of and
premium, if any, and accrued interest and Additional Interest, if
any, on the outstanding Securities on the Final Maturity Date of
such principal of or premium, if any, or interest, and Additional
Interest, if any, or on dates for payment and redemption of such
principal and premium, if any, and interest and Additional Interest,
if any, selected in accordance with the terms of this Indenture and
of the Securities;
(2) no Event of Default or Default with respect to the
Securities shall have occurred and be continuing on the date of such
deposit, or shall have occurred and be continuing at any time during
the period ending on the 91st day after the date of such deposit or,
if longer, ending on the day following the expiration of the longest
preference period under any Bankruptcy Law applicable to the Company
in respect of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such period);
(3) such Legal Defeasance Option or Covenant Defeasance
Option shall not cause the Trustee to have a conflicting interest
for purposes of the TIA with respect to any securities of the
Company;
(4) such Legal Defeasance Option or Covenant Defeasance
Option shall not result in a breach or violation of, or constitute
default under any other agreement, including without limitation the
Credit Agreement, or instrument to which the Company is a party or
by which it is bound;
(5) the Company shall have delivered to the Trustee an
Opinion of Counsel stating that, as a result of such Legal
Defeasance Option or Covenant Defeasance Option, neither the trust
nor the Trustee will be required to register as an investment
company under the Investment Company Act of 1940, as amended;
(6) in the case of an election under Section 8.02 above, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (i) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling to the effect
that or (ii) there has been a change in any applicable federal
income tax law with the effect that, and such opinion shall confirm
that, the Holders of the outstanding Securities or Persons in their
positions will not recognize income, gain or loss for federal income
tax purposes solely as a result of such deposit in the defeasance
trust or the exercise of the Legal Defeasance Option and will be
subject to federal income tax on the same amount, in the same manner
and at the same times as would have been the case if such deposit in
the defeasance trust or the exercise of the Legal Defeasance Option
had not occurred;
(7) in the case of an election under Section 8.03 hereof,
the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that the Holders of the outstanding Securities
or Persons in their positions will not recognize income, gain or
loss for federal income tax purposes solely as a result of such
deposit in the defeasance trust or the exercise of the Covenant
Defeasance Option and will be subject to federal income tax on the
same amount, in the same manner and at the same times as would have
been the case if such deposit in the defeasance trust or the
exercise of the Covenant Defeasance Option had not occurred;
(8) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that
all conditions precedent provided for relating to either the Legal
Defeasance Option under Section 8.02 or the Covenant Defeasance
Option under Section 8.03 (as the case may be) have been complied
with;
(9) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit under clause (1) was
not made by the Company with the intent of defeating, hindering,
delaying or defrauding any creditors of the Company or others; and
(10) the Company shall have paid or duly provided for
payment under terms mutually satisfactory to the Company and the
Trustee all amounts then due to the Trustee pursuant to Section 7.07
hereof.
SECTION 8.05. Deposited Money and U.S. Government
Obligations to Be Held in Trust; Other Miscellaneous Provisions. All money and
U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee pursuant to Section 8.04 hereof in respect of the outstanding
Securities shall be held in trust and applied by the Trustee, in accordance
with the provisions of such Securities and this Indenture, to the payment,
either directly or through any Paying Agent as the Trustee may determine, to
the Holders of such Securities, of all sums due and to become due thereon in
respect of principal, premium, if any, accrued interest and Additional
Interest, if any, but such money need not be segregated from other funds
except to the extent required by law.
The Company and the Guarantors shall pay and indemnify the
Trustee against any tax, fee or other charge imposed on or assessed against
the U.S. Government Obligations deposited pursuant to Section 8.04 hereof or
the principal, premium, if any, 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 Securities.
Anything in this Article Eight to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon Company Request any money or U.S. Government Obligations held by it
as provided in Section 8.04 which, in the opinion of a nationally-recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, are in excess of the amount thereof which
would then be required to be deposited to effect an equivalent Legal
Defeasance Option or Covenant Defeasance Option.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent
is unable to apply any money or U.S. Government Obligations in accordance with
Section 8.01, 8.02 or 8.03 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 application, the Company's and the
Guarantors' Obligations under this Indenture, the Securities and the
Guarantees shall be revived and reinstated as though no deposit had occurred
pursuant to this Article Eight until such time as the Trustee or Paying Agent
is permitted to apply all such money or U.S. Government Obligations in
accordance with Section 8.01; provided, however, that if the Company or the
Guarantors have made any payment of principal of, premium, if any, accrued
interest or Additional Interest, if any, on any Securities because of the
reinstatement of their Obligations, the Company or the Guarantors, as the case
may be, shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
SECTION 8.07. Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture, all moneys then held by
any Paying Agent under the provisions of this Indenture shall, upon demand of
the Company, be paid to the Trustee, or if sufficient moneys have been
deposited pursuant to Section 8.01 hereof, to the Company (or, if such moneys
had been deposited by a Guarantor, to such Guarantor), and thereupon such
Paying Agent shall be released from all further liability with respect to such
moneys.
SECTION 8.08. Moneys Held by Trustee. Any moneys deposited
with the Trustee or any Paying Agent or then held by the Company or the
Guarantors in trust for the payment of the principal of, or premium, if any,
interest or Additional Interest, if any, on any Security that are not applied
but remain unclaimed by the Holder of such Security for two years after the
date upon which the principal of, or premium, if any, interest or Additional
Interest, if any, on such Security shall have respectively become due and
payable shall be repaid to the Company (or, if appropriate, such Guarantor)
upon Company Request, or if such moneys are then held by the Company or the
Guarantors in trust, such moneys shall be released from such trust; and the
Holder of such Security entitled to receive such payment shall thereafter, as
an unsecured general creditor, look only to the Company and the Guarantors for
the payment thereof, and all liability of the Trustee or such Paying Agent
with respect to such trust money shall thereupon cease; provided, however,
that the Trustee or any such Paying Agent, before being required to make any
such repayment, may, at the expense of the Company and the Guarantors, either
mail to each Securityholder affected, at the address shown in the Register, or
cause to be published once a week for two successive weeks, in a newspaper
published in the English language, customarily published each Business Day and
of general circulation in The City of New York, New York, a notice that such
money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such mailing or publication, any
unclaimed balance of such moneys then remaining will be repaid to the Company
or such Guarantor. After payment to the Company or such Guarantor or the
release of any money held in trust by the Company or such Guarantor, as the
case may be, Securityholders entitled to the money must look only to the
Company and the Guarantors for payment as general creditors unless applicable
abandoned property law designates another Person.
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders. The Company, when
authorized by a resolution of the Board of Directors, and the Trustee may
amend or supplement this Indenture or the Securities without notice to or
consent of any Securityholder:
(i) to cure any ambiguity, defect or inconsistency;
provided, however, that such amendment or supplement does not
adversely affect the rights of any Holder;
(ii) to provide for uncertificated Securities in addition to
or in place of Certificated Securities;
(iii) to provide for the assumption by a successor Person of
the obligations of the Company or the Guarantors to the Holders of
Securities under the Securities, this Indenture and the Registration
Rights Agreement in connection with any transaction complying with
Article Five of this Indenture;
(iv) to provide for a guarantee of payment of the Securities
by any Restricted Subsidiary pursuant to Section 4.19; (v) to comply
with any requirements of the Commission in order to effect or
maintain the qualification of this Indenture under the TIA; or
(vi) to make any change that does not materially adversely
affect the legal rights of any Holder under this Indenture;
provided, however, that the Company has delivered to the Trustee an Opinion of
Counsel stating that such amendment or supplement complies with the provisions
of this Section 9.01.
SECTION 9.02. With Consent of Holders. Subject to Section
6.07, the Company and the Guarantors, when authorized by a resolution of the
Boards of Directors and the boards of directors of the Guarantors, and the
Trustee may amend or supplement this Indenture or the Securities with the
written consent of the Holders of at least a majority in principal amount of
the outstanding Securities. Subject to Section 6.07, the Holders of a majority
in principal amount of the outstanding Securities may waive compliance by the
Company or the Guarantors with any provision of this Indenture or the
Securities. However, without the consent of each Securityholder affected, an
amendment, supplement or waiver, including a waiver pursuant to Section 6.04,
may not:
(i) reduce the principal amount of any Securities whose
Holders must consent to an amendment to this Indenture or a waiver
under this Indenture;
(ii) reduce the rate on or change the interest payment time
on any Security or alter the redemption provisions with respect
thereto (other than the provisions relating to Section 4.05 and
4.14) or the price at which the Company is required to offer to
purchase the Securities;
(iii) reduce the principal of or change the fixed maturity
of any Security;
(iv) change currency of payment of the principal of or
interest on any Security;
(v) modify any provisions of Section 6.01 or 6.04 (other
than to add sections of this Indenture or the Securities subject
thereto) or 6.07;
(vi) make any change in any Guarantee that would materially
and adversely affect the Securityholders, or release any Guarantee
other than in accordance with this Indenture; or
(vii) waive any default in the payment of the principal of,
premium, if any, or unpaid interest on, and Additional Interest, if
any, with respect to the Securities.
It shall not be necessary for the consent of the Holders
under this Section 9.02 to approve the particular form of any proposed
amendment, supplement or waiver, but it shall be sufficient if such consent
approves the substance thereof.
After an amendment, supplement or waiver under this Section
9.02 becomes effective, the Company shall mail to the Holders affected thereby
a notice briefly describing the amendment, supplement or waiver. Any failure
of the Company to mail such notice, or any defect therein, shall not, however,
in any way impair or affect the validity of any such supplemental indenture.
SECTION 9.03. Compliance with Trust Indenture Act. Every
amendment to or supplement of this Indenture or the Securities shall comply
with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents. Until an
amendment or waiver becomes effective, a consent to it by a Holder is a
continuing consent by the Holder and every subsequent Holder of that Security
or portion of that Security that evidences the same debt as the consenting
Holder's Security, even if notation of the consent is not made on any
Security. Subject to the following paragraph, any such Holder or subsequent
Holder may revoke the consent as to such Holder's Security or portion of such
Security by notice to the Trustee or the Company received before the date on
which the Trustee receives an Officers' Certificate certifying that the
Holders of the requisite principal amount of Securities have consented (and
not theretofore revoked such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders of Securities entitled to
consent to any amendment, supplement or waiver. If a record date is fixed,
then, notwithstanding the last sentence of the immediately preceding
paragraph, those persons who were Holders of Securities at such record date
(or their duly designated proxies), and only those persons, shall be entitled
to consent to such amendment, supplement or waiver or to revoke any consent
previously given, whether or not such Persons continue to be Holders of such
Securities after such record date. No such consent shall be valid or effective
for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective,
it shall bind every Securityholder, unless it makes a change described in any
of clauses (i) through (vii) of Section 9.02. In that case the amendment,
supplement or waiver shall bind each Holder of a Security who has consented to
it and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holder's Security.
SECTION 9.05. Notation on or Exchange of Securities. If an
amendment, supplement or waiver changes the terms of a Security, the Trustee
may require the Holder of the Security to deliver it to the Trustee. The
Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the
Trustee so determines, the Company in exchange for the Security shall issue
and the Trustee shall authenticate a new Security that reflects the changed
terms. Failure to make the appropriate notation or issue a new Security shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. Trustee to Sign Amendments, etc. The Trustee
shall be entitled to receive, and shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article Nine is authorized or permitted by
this Indenture and that such amendment, supplement or waiver constitutes the
legal, valid and binding obligation of the Company and the Guarantors,
enforceable in accordance with its terms (subject to customary exceptions).
The Trustee may, but shall not be obligated to, execute any such amendment,
supplement or waiver which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise. In signing any amendment,
supplement or waiver, the Trustee shall be entitled to receive an indemnity
reasonably satisfactory to it.
ARTICLE X
GUARANTEES
SECTION 10.01. Unconditional Guarantees. Each of Fedders
Corporation and the Subsidiary Guarantors hereby, jointly and severally,
irrevocably and unconditionally guarantees to each Holder of a Security
authenticated by the Trustee and to the Trustee and its successors and assigns
that: the principal of and premium, if any, interest or Additional Interest,
if any, on the Securities will be promptly paid in full when due, subject to
any applicable grace period, whether on the Final Maturity Date, by
acceleration, call for redemption, upon a Change of Control Offer, upon an
Asset Sale Offer or otherwise, and interest on the overdue principal and
interest on any overdue interest on the Securities and expenses,
indemnification or otherwise, and all other obligations of the Company (all
such obligations guaranteed by Fedders Corporation and the Subsidiary
Guarantors being called herein the "Guaranteed Obligations"), to the Holders
or the Trustee hereunder or under the Securities will be promptly paid in full
or performed, all in accordance with the terms hereof and thereof; subject,
however, to the limitations set forth in Section 10.03. Each Guarantor hereby
agrees that its obligations hereunder shall be unconditional and continuing,
irrespective of the validity, regularity or enforceability of the Securities
or this Indenture, the absence of any action to enforce the same, any waiver
or consent by any Holder of the Securities 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 such Guarantor and
shall (a) remain in full force and effect until payment in full of all the
Guaranteed Obligations, (b) be binding upon such Guarantor and its successors,
transferees and assigns and (c) inure to the benefit of and be enforceable by
the Trustee, the Holders of the Securities and their successors, transferees
and assigns. 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 covenants that the
Guarantees will not be discharged except by complete performance of the
Guaranteed Obligations, and these Guarantees. If any Holder or the Trustee is
required by any court or otherwise to return to the Company, any Guarantor, or
any Custodian, trustee, liquidator or other similar official acting in
relation to the Company or any Guarantor, any amount paid by the Company or
such Guarantor to the Trustee or such Holder, the Guarantees, to the extent
theretofore discharged, shall be reinstated in full force and effect. Each
Guarantor further agrees that, as between it, on the one hand, and the Holders
and the Trustee, on the other hand, (x) the maturity of the Guaranteed
Obligations hereby may be accelerated as provided in Article Six for the
purpose of these Guarantees, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Guaranteed
Obligations, and (y) in the event of any acceleration of the Guaranteed
obligations as provided in Article Six, such Guaranteed Obligations (whether
or not due and payable) shall forthwith become due and payable by such
Guarantor for the purpose of these Guarantees.
SECTION 10.02. Severability. In case any provision of these
Guarantees shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
SECTION 10.03. Limitation of Guarantors' Liability. Each
Guarantor and, by its acceptance of a Security issued hereunder, each Holder
and the Trustee hereby confirm that it is the intention of all such parties
that the guarantee by each Guarantor pursuant to its Guarantee not constitute
a fraudulent transfer or conveyance for purposes of any Bankruptcy Law, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar U.S. federal or state or other applicable law. To effectuate the
foregoing intention, the Holders and each Guarantor hereby irrevocably agree
that the obligations of such Guarantor under the Guarantee shall be limited to
the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Guarantor, result in the obligations of such
Guarantor under the Guarantee not constituting such fraudulent transfer or
conveyance.
SECTION 10.04. Subordination of Subrogation and Other
Rights. Each Guarantor hereby agrees that any claim against the Company that
arises from the payment, performance or enforcement of such Guarantor's
obligations under the Guarantee or this Indenture, including, without
limitation, any right of subrogation, shall be subject and subordinate to, and
no payment with respect to any such claim of such Guarantor shall be made
before, the payment in full in cash of all outstanding Securities in
accordance with the provisions provided therefor in this Indenture.
SECTION 10.05. Delivery of Guarantees. The delivery of any
Security by the Trustee, after the authentication thereof hereunder, shall
constitute due delivery of the Guarantees set forth in Section 10.01 on behalf
of the Guarantors.
SECTION 10.06. Release of Subsidiary Guarantor. A Subsidiary
Guarantor shall be released from its obligations under this Article Ten (other
than any obligation that shall have arisen under Section 10.07): (a) upon the
sale or other disposition (including by way of consolidation or merger) of a
Subsidiary Guarantor, including the sale or disposition of Capital Stock of a
Subsidiary Guarantor following which such Subsidiary Guarantor is no longer a
Subsidiary; (b) upon the sale or disposition of all or substantially all of
the assets of such Subsidiary Guarantor; (c) upon the designation of such
Subsidiary Guarantor as an Unrestricted Subsidiary; (d) at such time as such
Subsidiary Guarantor does not have any Indebtedness outstanding that would
have required such Subsidiary Guarantor to enter into a Guaranty Agreement
pursuant to Section 4.19; or (e) upon defeasance of the Securities or
discharge of this Indenture pursuant to Article Eight; provided, however, that
in the case of clauses (a) and (b) above, (i) such sale or other disposition
is made to a Person other than the Company or a Restricted Subsidiary, (ii)
such sale or disposition is otherwise permitted by this Indenture and (iii)
the Company provides an Officers' Certificate to the Trustee to the effect
that the Company will comply with its obligations under Section 4.05.
SECTION 10.07. Contribution. Each Subsidiary Guarantor that
makes a payment under its Subsidiary Guaranty shall be entitled upon payment
in full of all Guaranteed Obligations under this Indenture to a contribution
from each other Subsidiary Guarantor in an amount equal to such other
Subsidiary Guarantor's pro rata portion of such payment based on the
respective net assets of all the Subsidiary Guarantors at the time of such
payment determined in accordance with GAAP.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls. This Indenture
is subject to the provisions, of the TIA that are required to be a part of
this Indenture, and shall, to the extent applicable, be governed by such
provisions. If any provision of this Indenture modifies any TIA provision that
may be so modified, such TIA provision shall be deemed to apply to this
Indenture as so modified. If any provision of this Indenture excludes any TIA
provision that may be so excluded, such TIA provision shall be excluded from
this Indenture.
The provisions of TIA xx.xx. 310 through 317 that impose
duties on any Person (including the provisions automatically deemed included
unless expressly excluded by this Indenture) are a part of and govern this
Indenture, whether or not physically contained herein.
SECTION 11.02. Notices. Any notice or communication shall be
sufficiently given if in writing and delivered in person, by facsimile and
confirmed by overnight courier, or mailed by first-class mail addressed as
follows:
if to the Company or to the Guarantors:
Fedders Corporation
Westgate Corporate Center
000 Xxxxxxxxxxxx Xxxx
Xxxxxxx Xxxxxx, Xxx Xxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx
Vice President and General Counsel
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
if to the Trustee:
U.S. Bank National Association Xxx Xxxxxxx Xxxxxx -
0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention:
Corporate Trust Department Facsimile: (617)
000-0000 Telephone: (000) 000-0000
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed, first-class, postage
prepaid, to a Holder including any notice delivered in connection with TIA ss.
310(b), TIA ss. 313(c), TIA ss. 314(a) and TIA ss. 315(b), shall be mailed to
it or him at its or his address as set forth in the Register and shall be
sufficiently given to it or him if so mailed within the time prescribed. To
the extent required by the TIA, any notice or communication shall also be
mailed to any Person described in TIA ss. 313(c).
Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its sufficiency with
respect to other Securityholders. Except for a notice to the Trustee, which is
deemed given only when received, if a notice or communication is mailed in the
manner provided above, it is duly given, whether or not the addressee receives
it.
SECTION 11.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other Person shall
have the protection of TIA ss. 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Company or Fedders
Corporation to the Trustee to take or refrain from taking any action under
this Indenture, the Company or Fedders Corporation shall furnish to the
Trustee at the request of the Trustee:
(1) an Officers' Certificate in form and substance
satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with;
and
(2) an Opinion of Counsel in form and substance satisfactory
to the Trustee stating that, in the opinion of such counsel, all
such conditions precedent have been complied with.
SECTION 11.05. Statements Required in Certificate or
Opinion. Each Officers' Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(1) a statement that the Person making such certificate or
opinion has read such 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 has
made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel
may rely on an Officers' Certificate or certificates of public
officials.
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for
its functions.
SECTION 11.07. Governing Law. The laws of the State of New
York shall govern this Indenture, the Securities and the Guarantee without
regard to principles of conflicts of law.
SECTION 11.08. No Recourse Against Others. A director,
officer, employee or stockholder, as such, of the Company or any of the
Guarantors shall not have any liability for any Obligations of the Company or
the Guarantors under the Securities, the Guarantees or this Indenture or for
any claim based on, in respect of or by reason of such Obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability and such waiver and release is part of the consideration for
issuance of the Securities.
SECTION 11.09. Successors. All agreements of the Company in
this Indenture and the Securities shall bind its successor. All agreements of
the Guarantors in this Indenture and the Guarantees shall bind their
respective successors. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 11.10. Counterpart Originals. The parties may sign
any number of copies of this Indenture. Each signed copy shall be an original,
but all of them together represent the same agreement.
SECTION 11.11. Severability. In case any provision in this
Indenture, in the Securities or in the Guarantees shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby, and a Holder
shall have no claim therefor against any party hereto.
SECTION 11.12. No Adverse Interpretation of Other
Agreements. This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company, Fedders Corporation or a Subsidiary.
Any such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 11.13. Legal Holidays. If a payment date is a not a
Business Day at a place of payment, payment may be made at that place on the
next succeeding Business Day, and no interest shall accrue for the intervening
period.
[Signature Pages Follow]
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
FEDDERS NORTH AMERICA, INC.,
By
--------------------------------------------------
Name:
Title:
FEDDERS CORPORATION, as Guarantor,
By
--------------------------------------------------
Name:
Title:
As for the Subsidiary Guarantors,
XXXXXXX QUIET KOOL CORPORATION
COLUMBIA SPECIALTIES, INC.
ROTOREX COMPANY, INC.
FEDDERS OUTLET, INC.
FEDDERS INC.
TRION, INC.
MELCOR CORPORATION
XXXXXX MANUFACTURING ENTERPRISES INC.
ENVIRCO CORPORATION
By
--------------------------------------------------
Name:
Title:
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
U.S. BANK NATIONAL ASSOCIATION, as Trustee,
By
--------------------------------------------------
Name:
Title:
RULE 144A/REGULATION S/IAI APPENDIX
PROVISIONS RELATING TO INITIAL SECURITIES,
PRIVATE EXCHANGE SECURITIES
AND EXCHANGE SECURITIES
1. Definitions
1.1. Definitions
For the purposes of this Appendix the following terms shall have the
meanings indicated below:
"Applicable Procedures" means, with respect to any transfer
or transaction involving a Temporary Regulation S Global Security or
beneficial interest therein, the rules and procedures of the Depository for
such a Temporary Regulation S Global Security, to the extent applicable to
such transaction and as in effect from time to time.
"Definitive Security" means a certificated Initial Security
or Exchange Security or Private Exchange Security bearing, if required, the
appropriate restricted securities legend set forth in Section 2.3(e).
"Depository" means The Depository Trust Company, its
nominees and their respective successors.
"Distribution Compliance Period", with respect to any
Securities, means the period of 40 consecutive days beginning on and including
the later of (i) the day on which such Securities are first offered to Persons
other than distributors (as defined in Regulation S under the Securities Act)
in reliance on Regulation S and (ii) the issue date with respect to such
Securities.
"Exchange Securities" means (1) the 97/8% Senior Notes Due
2014 issued pursuant to the Indenture in connection with a Registered Exchange
Offer pursuant to the Registration Rights Agreement and (2) Additional
Securities, if any, offered and sold by the Company pursuant to a registration
statement filed with the Commission under the Securities Act.
"IAI" means an institutional "accredited investor," as
defined in Rule 501(a) (1), (2), (3) or (7) of Regulation D under the
Securities Act.
"Initial Purchaser" means (1) with respect to the Initial
Securities issued on the Issue Date, Credit Suisse First Boston LLC and (2)
with respect to each issuance of Additional Securities, the Persons purchasing
or underwriting such Additional Securities under the related Purchase
Agreement.
"Initial Securities" means (1) $155.0 million aggregate
principal amount of 97/8% Senior Notes Due 2014 issued on the Issue Date and
(2) Additional Securities, if any, offered and sold by the Company in a
transaction exempt from the registration requirements of the Securities Act.
"Private Exchange" means the offer by the Company, pursuant
to the Registration Rights Agreement, to the Initial Purchaser to issue and
deliver to the Initial Purchaser, in exchange for the Initial Securities held
by the Initial Purchaser as part of its initial distribution, a like aggregate
principal amount of Private Exchange Securities.
"Private Exchange Securities" means any 97/8% Senior Notes
Due 2014 issued in connection with a Private Exchange.
"Purchase Agreement" means (1) with respect to the Initial
Securities issued on the Issue Date, the Purchase Agreement dated February 26,
2004, among the Company, the Guarantors and the Initial Purchaser and (2) with
respect to each issuance of Additional Securities, the purchase agreement or
underwriting agreement among the Company, the Guarantors and the Persons
purchasing or underwriting such Additional Securities.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Registered Exchange Offer" means the offer by the Company,
pursuant to a Registration Rights Agreement, to certain Holders of Initial
Securities, to issue and deliver to such Holders, in exchange for the Initial
Securities, a like aggregate principal amount of Exchange Securities
registered under the Securities Act.
"Registration Rights Agreement" means (1) with respect to
the Initial Securities issued on the Issue Date, the Registration Rights
Agreement dated March 8, 2004, among the Company, the Guarantors and the
Initial Purchaser and (2) with respect to each issuance of Additional
Securities issued in a transaction exempt from the registration requirements
of the Securities Act, the registration rights agreement, if any, among the
Company, the Guarantors and the Persons purchasing such Additional Securities
under the related Purchase Agreement.
"Rule 144A Securities" means all Securities offered and sold
to QIBs in reliance on Rule 144A.
"Securities" means the Initial Securities, the Exchange
Securities and the Private Exchange Securities, treated as a single class
under the Indenture.
"Securities Act" means the Securities Act of 1933.
"Securities Custodian" means the custodian with respect to a
Global Security (as appointed by the Depository), or any successor Person
thereto, and shall initially be the Trustee.
"Shelf Registration Statement" means the registration
statement issued by the Company in connection with the offer and sale of
Initial Securities or Private Exchange Securities pursuant to the Registration
Rights Agreement.
"Transfer Restricted Securities" means Securities that bear
or are required to bear a legend relating to restrictions on transfer relating
to the Securities Act set forth in Section 2.3(e).
1.2. Other Definitions
Defined in
Term Section:
---- -------
"Agent Members"............................................ 2.1(b)
"Global Securities"........................................ 2.1(a)
"IAI Global Security"...................................... 2.1(a)
"Permanent Regulation S Global Security"................... 2.1(a)
"Regulation S"............................................. 2.1(a)
"Regulation S Global Security"............................. 2.1(a)
"Rule 144A"................................................ 2.1(a)
"Rule 144A Global Security"................................ 2.1(a)
"Temporary Regulation S Global Security"................... 2.1(a)
2. The Securities
2.1. (a) Form and Dating. The Initial Securities will be offered and
sold by the Company pursuant to a Purchase Agreement. The Initial Securities
will be resold initially only to (i) QIBs in reliance on Rule 144A under the
Securities Act ("Rule 144A") and (ii) Persons other than U.S. Persons (as
defined in Regulation S) in reliance on Regulation S under the Securities Act
("Regulation S"). Initial Securities may thereafter be transferred to, among
others, QIBs, IAIs and purchasers in reliance on Regulation S, subject to the
restrictions on transfer set forth herein. Initial Securities initially resold
pursuant to Rule 144A shall be issued initially in the form of one or more
permanent global Securities in definitive, fully registered form
(collectively, the "Rule 144A Global Security"); Initial Securities initially
resold to IAIs shall be issued initially in the form of one or more permanent
global Securities in definitive, fully registered form (collectively, the "IAI
Global Security"); and Initial Securities initially resold pursuant to
Regulation S shall be issued initially in the form of one or more temporary
global securities in fully registered form (collectively, the "Temporary
Regulation S Global Security"), in each case without interest coupons and with
the global securities legend and the applicable restricted securities legend
set forth in Exhibit 1 hereto, which shall be deposited on behalf of the
purchasers of the Initial Securities represented thereby with the Trustee, at
its principal corporate trust office, as custodian for the Depository (or with
such other custodian as the Depository may direct), and registered in the name
of the Depository or a nominee of the Depository, duly executed by the Company
and authenticated by the Trustee as provided in this Indenture. Except as set
forth in this Section 2.1(a), beneficial ownership interests in the Temporary
Regulation S Global Security will not be exchangeable for interests in the
Rule 144A Global Security, the IAI Global Security, a permanent global
security (the "Permanent Regulation S Global Security", and together with the
Temporary Regulation S Global Security, the "Regulation S Global Security") or
any other Security prior to the expiration of the Distribution Compliance
Period and then, after the expiration of the Distribution Compliance Period,
may be exchanged for interests in a Rule 144A Global Security, an IAI Global
Security or the Permanent Regulation S Global Security only upon certification
in form reasonably satisfactory to the Trustee that (i) beneficial ownership
interests in such Temporary Regulation S Global Security are owned by either
non-U.S. persons or U.S. persons who purchased such interests in a transaction
that did not require registration under the Securities Act and (ii) in the
case of an exchange for an IAI Global Security, certification that the
interest in the Temporary Regulation S Global Security is being transferred to
an IAI under the Securities Act that is an IAI acquiring the securities for
its own account or for the account of an IAI.
Beneficial interests in Temporary Regulation S Global
Securities or IAI Global Securities may be exchanged for interests in Rule
144A Global Securities if (1) such exchange occurs in connection with a
transfer of Securities in compliance with Rule 144A and (2) the transferor of
the beneficial interest in the Temporary Regulation S Global Security or the
IAI Global Security, as applicable, first delivers to the Trustee a written
certificate (in a form satisfactory to the Trustee) to the effect that the
beneficial interest in the Temporary Regulation S Global Security or the IAI
Global Security, as applicable, is being transferred to a Person (a) who the
transferor reasonably believes to be a QIB, (b) purchasing for its own account
or the account of a QIB in a transaction meeting the requirements of Rule 144A
and (c) in accordance with all applicable securities laws of the States of the
United States and other jurisdictions.
Beneficial interests in Temporary Regulation S Global
Securities and Rule 144A Global Securities may be exchanged for an interest in
IAI Global Securities if (1) such exchange occurs in connection with a
transfer of the securities in compliance with an exemption under the
Securities Act and (2) the transferor of the Regulation S Global Security or
Rule 144A Global Security, as applicable, first delivers to the trustee a
written certificate (substantially in the form of Exhibit 2) to the effect
that (A) the Regulation S Global Security or Rule 144A Global Security, as
applicable, is being transferred (a) to an "accredited investor" within the
meaning of 501(a) (1), (2), (3) or (7) under the Securities Act that is an IAI
acquiring the securities for its own account or for the account of such an
IAI, in each case in a minimum principal amount of Securities of $250,000, for
investment purposes and not with a view to or for offer or sale in connection
with any distribution in violation of the Securities Act and (B) in accordance
with all applicable securities laws of the States of the United States and
other jurisdictions.
Beneficial interests in a Rule 144A Global Security or an
IAI Global Security may be transferred to a Person who takes delivery in the
form of an interest in a Regulation S Global Security, whether before or after
the expiration of the Distribution Compliance Period, only if the transferor
first delivers to the Trustee a written certificate (in the form provided in
the Indenture) to the effect that such transfer is being made in accordance
with Rule 903 or 904 of Regulation S or Rule 144 (if applicable).
The Rule 144A Global Security, the IAI Global Security, the
Temporary Regulation S Global Security and the Permanent Regulation S Global
Security are collectively referred to herein as "Global Securities". The
aggregate principal amount of the Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee and
the Depository or its nominee as hereinafter provided.
(b) Book-Entry Provisions. This Section 2.1(b) shall apply
only to a Global Security deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in
accordance with this Section 2.1(b), authenticate and deliver initially one or
more Global Securities that (a) shall be registered in the name of the
Depository for such Global Security or Global Securities or the nominee of
such Depository and (b) shall be delivered by the Trustee to such Depository
or pursuant to such Depository's instructions or held by the Trustee as
custodian for the Depository.
Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depository or by the Trustee as the
custodian of the Depository or under such Global Security, and the Company,
the Guarantors, the Trustee and any agent of the Company, the Guarantors or
the Trustee shall be entitled to treat the Depository as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Guarantors, the
Trustee or any agent of the Company, the Guarantors or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its Agent Members, the
operation of customary practices of such Depository governing the exercise of
the rights of a holder of a beneficial interest in any Global Security.
(c) Definitive Securities. Except as provided in this
Section 2.1 or Section 2.3 or 2.4, owners of beneficial interests in Global
Securities shall not be entitled to receive physical delivery of Definitive
Securities.
2.2. Authentication. The Trustee shall authenticate and deliver: (1)
on the Issue Date, an aggregate principal amount of $155.0 million 97/8%
Senior Notes Due 2014, (2) any Additional Securities for an original issue in
an aggregate principal amount specified in the written order of the Company
pursuant to Section 2.15 of the Indenture and (3) Exchange Securities or
Private Exchange Securities for issue only in a Registered Exchange Offer or a
Private Exchange, respectively, pursuant to the Registration Rights Agreement,
for a like principal amount of Initial Securities, in each case upon a written
order of the Company signed by two Officers or by an Officer and either an
Assistant Treasurer or an Assistant Secretary of the Company. Such order shall
specify the amount of the Securities to be authenticated and the date on which
the original issue of Securities is to be authenticated and, in the case of
any issuance of Additional Securities pursuant to Section 2.15 of the
Indenture, shall certify that such issuance is in compliance with Section 4.04
of the Indenture.
2.3. Transfer and Exchange.
(a) Transfer and Exchange of Definitive Securities. When
Definitive Securities are presented to the Trustee with a request:
(x) to register the transfer of such Definitive
Securities; or
(y) to exchange such Definitive Securities for an equal
principal amount of Definitive Securities of other
authorized denominations,
the Trustee shall register the transfer or make the exchange as requested if
its reasonable requirements for such transaction are met; provided, however,
that the Definitive Securities surrendered for transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company
and the Trustee, duly executed by the Holder thereof or its attorney
duly authorized in writing; and
(ii) if such Definitive Securities are required to bear a
restricted securities legend, they are being transferred or exchanged
pursuant to an effective registration statement under the Securities
Act, pursuant to Section 2.3(b) or pursuant to clause (A), (B) or (C)
below, and are accompanied by the following additional information
and documents, as applicable:
if such Definitive Securities are being delivered
to the Trustee by a Holder for registration in the name of
such Holder, without transfer, a certification from such
Holder to that effect; or
if such Definitive Securities are being transferred
to the Company, a certification to that effect; or
if such Definitive Securities are being transferred
(x) pursuant to an exemption from registration in accordance
with Rule 144A, Regulation S or Rule 144 under the
Securities Act; or (y) in reliance upon another exemption
from the requirements of the Securities Act: (i) a
certification to that effect (in the form set forth on the
reverse of the Security) and (ii) if the Company so
requests, an opinion of counsel or other evidence reasonably
satisfactory to it as to the compliance with the
restrictions set forth in the legend set forth in Section
2.3(e)(i).
(b) Restrictions on Transfer of a Definitive Security for a
Beneficial Interest in a Global Security. A Definitive Security may not be
exchanged for a beneficial interest in a Rule 144A Global Security, an IAI
Global Security or a Permanent Regulation S Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Trustee
of a Definitive Security, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Trustee, together with:
(i) certification, in the form set forth on the reverse of
the Security, that such Definitive Security is either (A) being
transferred to a QIB in accordance with Rule 144A, (B) being
transferred to an IAI or (C) being transferred after expiration of
the Distribution Compliance Period by a Person who initially
purchased such Security in reliance on Regulation S to a buyer who
elects to hold its interest in such Security in the form of a
beneficial interest in the Permanent Regulation S Global Security;
and
(ii) written instructions directing the Trustee to make, or
to direct the Securities Custodian to make, an adjustment on its
books and records with respect to such Rule 144A Global Security (in
the case of a transfer pursuant to clause (b)(i)(A)), IAI Global
Security (in the case of a transfer pursuant to clause (b)(1)(B)) or
Permanent Regulation S Global Security (in the case of a transfer
pursuant to clause (b)(i)(C)) to reflect an increase in the aggregate
principal amount of the Securities represented by the Rule 144A
Global Security, IAI Global Security or Permanent Regulation S Global
Security, as applicable, such instructions to contain information
regarding the Depository account to be credited with such increase,
then the Trustee shall cancel such Definitive Security and cause, or direct
the Securities Custodian to cause, in accordance with the standing
instructions and procedures existing between the Depository and the Securities
Custodian, the aggregate principal amount of Securities represented by the
Rule 144A Global Security, IAI Global Security or Permanent Regulation S
Global Security, as applicable, to be increased by the aggregate principal
amount of the Definitive Security to be exchanged and shall credit or cause to
be credited to the account of the Person specified in such instructions a
beneficial interest in the Rule 144A Global Security, IAI Global Security or
Permanent Regulation S Global Security, as applicable, equal to the principal
amount of the Definitive Security so canceled. If no Rule 144A Global
Securities, IAI Global Securities or Permanent Regulation S Global Securities,
as applicable, are then outstanding, the Company shall issue and the Trustee
shall authenticate, upon written order of the Company in the form of an
Officers' Certificate of the Company, a new Rule 144A Global Security, IAI
Global Security or Permanent Regulation S Global Security, as applicable, in
the appropriate principal amount.
(c) Transfer and Exchange of Global Securities.
(i) The transfer and exchange of Global Securities or
beneficial interests therein shall be effected through the
Depository, in accordance with this Indenture (including applicable
restrictions on transfer set forth herein, if any) and the procedures
of the Depository therefor. A transferor of a beneficial interest in
a Global Security shall deliver to the Trustee a written order given
in accordance with the Depository's procedures containing information
regarding the participant account of the Depository to be credited
with a beneficial interest in the Global Security. The Trustee shall,
in accordance with such instructions, instruct the Depository to
credit to the account of the Person specified in such instructions a
beneficial interest in the Global Security and to debit the account
of the Person making the transfer the beneficial interest in the
Global Security being transferred.
(ii) If the proposed transfer is a transfer of a beneficial
interest in one Global Security to a beneficial interest in another
Global Security, the Trustee shall reflect on its books and records
the date and an increase in the principal amount of the Global
Security to which such interest is being transferred in an amount
equal to the principal amount of the interest to be so transferred,
and the Trustee shall reflect on its books and records the date and a
corresponding decrease in the principal amount of the Global Security
from which such interest is being transferred.
(iii) Notwithstanding any other provisions of this Appendix
(other than the provisions set forth in Section 2.4), a Global
Security may not be transferred as a whole except by the Depository
to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the
Depository or any such nominee to a successor Depository or a nominee
of such successor Depository.
(iv) In the event that a Global Security is exchanged for
Definitive Securities pursuant to Section 2.4 of this Appendix, prior
to the consummation of a Registered Exchange Offer or the
effectiveness of a Shelf Registration Statement with respect to such
Securities, such Securities may be exchanged only in accordance with
such procedures as are substantially consistent with the provisions
of this Section 2.3 (including the certification requirements set
forth on the reverse of the Securities intended to ensure that such
transfers comply with Rule 144A, Regulation S or another applicable
exemption under the Securities Act, as the case may be) and such
other procedures as may from time to time be adopted by the Company.
(d) Restrictions on Transfer of Temporary Regulation S
Global Securities. During the Distribution Compliance Period, beneficial
ownership interests in Temporary Regulation S Global Securities may only be
sold, pledged or transferred in accordance with the Applicable Procedures and
only (i) to the Company, (ii) in an offshore transaction in accordance with
Regulation S (other than a transaction resulting in an exchange for an
interest in a Permanent Regulation S Global Security) or (iii) pursuant to an
effective registration statement under the Securities Act, in each case in
accordance with any applicable securities laws of any State of the United
States.
(e) Legend.
(i) Except as permitted by the following paragraphs (ii),
(iii) and (iv), each Security certificate evidencing the Global
Securities (and all Securities issued in exchange therefor or in
substitution thereof), in the case of Securities offered otherwise
than in reliance on Regulation S, shall bear a legend in
substantially the following form:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN
A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED
STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND
THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO THE COMPANY,
(II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) TO
AN INSTITUTIONAL "ACCREDITED INVESTOR" THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED
FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN
AGGREGATE PRINCIPAL AMOUNT OF SECURITIES OF LESS THAN
$250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY
THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT,
(IV) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (V)
PURSUANT TO EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (VI)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH OF CASES (I) THROUGH (VI), IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF
THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO
IN (A) ABOVE.
Each certificate evidencing a Security offered in reliance
on Regulation S shall bear a legend in substantially the following form:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN
A TRANSACTION ORIGINALLY EXEMPT FROM REGISTRATION UNDER THE
U.S. SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND MAY
NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT PURSUANT TO AN
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS.
TERMS USED ABOVE HAVE THE MEANINGS GIVEN TO THEM IN
REGULATION S UNDER THE SECURITIES ACT.
Each Definitive Security shall also bear the following
additional legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER
INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO
CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security represented by a
Global Security) pursuant to Rule 144 under the Securities Act, the
Registrar shall permit the transferee thereof to exchange such
Transfer Restricted Security for a certificated Security that does
not bear the legend set forth above and rescind any restriction on
the transfer of such Transfer Restricted Security, if the transferor
thereof certifies in writing to the Registrar that such sale or
transfer was made in reliance on Rule 144 (such certification to be
in the form set forth on the reverse of the Security).
(iii) After a transfer of any Initial Securities or Private
Exchange Securities pursuant to and during the period of the
effectiveness of a Shelf Registration Statement with respect to such
Initial Securities or Private Exchange Securities, as the case may
be, all requirements pertaining to legends on such Initial Security
or such Private Exchange Security will cease to apply, the
requirements requiring any such Initial Security or such Private
Exchange Security issued to certain Holders be issued in global form
will cease to apply, and a certificated Initial Security or Private
Exchange Security or an Initial Security or Private Exchange Security
in global form, in each case without restrictive transfer legends,
will be available to the transferee of the Holder of such Initial
Securities or Private Exchange Securities upon exchange of such
transferring Holder's certificated Initial Security or Private
Exchange Security or directions to transfer such Holder's interest in
the Global Security, as applicable.
(iv) Upon the consummation of a Registered Exchange Offer
with respect to the Initial Securities, all requirements pertaining
to such Initial Securities that Initial Securities issued to certain
Holders be issued in global form will still apply with respect to
Holders of such Initial Securities that do not exchange their Initial
Securities, and Exchange Securities in certificated or global form,
in each case without the restricted securities legend set forth in
Exhibit 1 hereto will be available to Holders that exchange such
Initial Securities in such Registered Exchange Offer.
(v) Upon the consummation of a Private Exchange with respect
to the Initial Securities, all requirements pertaining to such
Initial Securities that Initial Securities issued to certain Holders
be issued in global form will still apply with respect to Holders of
such Initial Securities that do not exchange their Initial
Securities, and Private Exchange Securities in global form with the
global securities legend and the applicable restricted securities
legend set forth in Exhibit 1 hereto will be available to Holders
that exchange such Initial Securities in such Private Exchange.
(f) Cancellation or Adjustment of Global Security. At such
time as all beneficial interests in a Global Security have either been
exchanged for Definitive Securities, redeemed, purchased or canceled, such
Global Security shall be returned to the Depository for cancellation or
retained and canceled by the Trustee. At any time prior to such cancellation,
if any beneficial interest in a Global Security is exchanged for Definitive
Securities, redeemed, purchased or canceled, the principal amount of
Securities represented by such Global Security shall be reduced and an
adjustment shall be made on the books and records of the Trustee (if it is
then the Securities Custodian for such Global Security) with respect to such
Global Security, by the Trustee or the Securities Custodian, to reflect such
reduction.
(g) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation
to any beneficial owner of a Global Security, a member of, or a
participant in the Depository or other Person with respect to the
accuracy of the records of the Depository or its nominee or of any
participant or member thereof, with respect to any ownership interest
in the Securities or with respect to the delivery to any participant,
member, beneficial owner or other Person (other than the Depository)
of any notice (including any notice of redemption) or the payment of
any amount, under or with respect to such Securities. All notices and
communications to be given to the Holders and all payments to be made
to Holders under the Securities shall be given or made only to or
upon the order of the registered Holders (which shall be the
Depository or its nominee in the case of a Global Security). The
rights of beneficial owners in any Global Security shall be exercised
only through the Depository subject to the applicable rules and
procedures of the Depository. The Trustee may rely and shall be fully
protected in relying upon information furnished by the Depository
with respect to its members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions
on transfer imposed under this Indenture or under applicable law with
respect to any transfer of any interest in any Security (including
any transfers between or among Depository participants, members or
beneficial owners in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as
are expressly required by, and to do so if and when expressly
required by, the terms of this Indenture, and to examine the same to
determine substantial compliance as to form with the express
requirements hereof.
2.4. Certificated Securities.
(a) A Global Security deposited with the Depository or with
the Trustee as Securities Custodian for the Depository pursuant to Section 2.1
shall be transferred to the beneficial owners thereof in the form of
Definitive Securities in an aggregate principal amount equal to the principal
amount of such Global Security, in exchange for such Global Security, only if
such transfer complies with Section 2.3 hereof and (i) the Depository notifies
the Company that it is unwilling or unable to continue as Depository for such
Global Security and the Depository fails to appoint a successor Depository or
if at any time such Depository ceases to be a "clearing agency" registered
under the Exchange Act and, in either case, a successor Depository is not
appointed by the Company within 90 days of such notice, or (ii) an Event of
Default has occurred and is continuing or (iii) the Company, in its sole
discretion, notifies the Trustee in writing that it elects to cause the
issuance of Definitive Securities under this Indenture.
(b) Any Global Security that is transferable to the
beneficial owners thereof pursuant to this Section 2.4 shall be surrendered by
the Depository to the Trustee located at its principal corporate trust office
in the Borough of Manhattan, The City of New York, to be so transferred, in
whole or from time to time in part, without charge, and the Trustee shall
authenticate and deliver, upon such transfer of each portion of such Global
Security, an equal aggregate principal amount of Definitive Securities of
authorized denominations. Any portion of a Global Security transferred
pursuant to this Section 2.4 shall be executed, authenticated and delivered
only in denominations of $1,000 principal amount and any integral multiple
thereof and registered in such names as the Depository shall direct. Any
Definitive Security delivered in exchange for an interest in the Transfer
Restricted Security shall, except as otherwise provided by Section 2.3(e)
hereof, bear the applicable restricted securities legend and definitive note
legend set forth in Exhibit 1 hereto.
(c) Subject to the provisions of Section 2.4(b) hereof, the
registered Holder of a Global Security shall be entitled to grant proxies and
otherwise authorize any Person, including Agent Members and Persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
(d) In the event of the occurrence of one of the events
specified in Section 2.4(a) hereof, the Company shall promptly make available
to the Trustee a reasonable supply of Definitive Securities in definitive,
fully registered form without interest coupons. In the event that the
Definitive Securities are not issued to each such beneficial owner promptly
after the Registrar has received a request from the Holder of a Global
Security to issue such Certificated Security, the Company expressly
acknowledges, with respect to the right of any Holder to pursue a remedy
pursuant to Article 6 of the Indenture, the right of any beneficial holder of
Securities to pursue such remedy with respect to the portion of the Global
Security that represents such beneficial holder's Securities as if such
Certificated Securities had been issued.
EXHIBIT 1
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), NEW YORK, NEW YORK, 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 IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[[FOR REGULATION S GLOBAL SECURITY ONLY] UNTIL 40 DAYS AFTER
THE LATER OF COMMENCEMENT OR COMPLETION OF THE OFFERING, AN OFFER OR SALE OF
SECURITIES WITHIN THE UNITED STATES BY A DEALER (AS DEFINED IN THE SECURITIES
ACT) MAY VIOLATE THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IF SUCH
OFFER OR SALE IS MADE OTHERWISE THAN IN ACCORDANCE WITH RULE 144A THEREUNDER.]
[Restricted Securities Legend for Securities Offered
Otherwise than in Reliance on Regulation S]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN
A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT
OF 1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT
THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED, ONLY (I) TO THE COMPANY, (II) WITHIN THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (III) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF
THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF
SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF SECURITIES OF
LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (IV) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (V) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (VI) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF
CASES (I) THROUGH (VI) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT
HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE
RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
[Restricted Securities Legend for Securities Offered
in Reliance on Regulation S.]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN
A TRANSACTION ORIGINALLY EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND MAY NOT BE TRANSFERRED IN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE
THE MEANINGS GIVEN TO THEM IN REGULATION S UNDER THE SECURITIES ACT.
[Temporary Regulation S Global Security Legend]
EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN
THIS TEMPORARY REGULATION S GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR
INTERESTS IN THE PERMANENT REGULATION S GLOBAL SECURITY OR ANY OTHER SECURITY
REPRESENTING AN INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH DO NOT
CONTAIN A LEGEND CONTAINING RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF
THE "40-DAY DISTRIBUTION COMPLIANCE PERIOD" (WITHIN THE MEANING OF RULE
903(b)(2) OF REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON
CERTIFICATION IN FORM REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH
BENEFICIAL INTERESTS ARE OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO
PURCHASED SUCH INTERESTS IN A TRANSACTION THAT DID NOT REQUIRE REGISTRATION
UNDER THE SECURITIES ACT. DURING SUCH 40-DAY DISTRIBUTION COMPLIANCE PERIOD,
BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY
MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED (I) TO THE COMPANY, (II) OUTSIDE THE
UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, OR (III) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (III) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY
WILL NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS REFERRED
TO ABOVE, IF THEN APPLICABLE.
AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD,
BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE
EXCHANGED FOR INTERESTS IN A RULE 144A GLOBAL SECURITY ONLY IF (1) SUCH
EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE
WITH RULE 144A AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY
FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO
THIS CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL SECURITY IS BEING
TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES TO BE A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, (B) TO A PERSON
WHO IS PURCHASING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
AND (C) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.
AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD,
BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE
EXCHANGED FOR INTERESTS IN AN IAI GLOBAL SECURITY ONLY IF (1) SUCH EXCHANGE
OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH AN
EXEMPTION UNDER THE SECURITIES ACT AND (2) THE TRANSFEROR OF THE REGULATION S
GLOBAL SECURITY FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE
FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL
SECURITY IS BEING TRANSFERRED (A) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF
THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF
SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF SECURITIES OF
LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND (B) IN ACCORDANCE WITH
ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER
JURISDICTIONS.
BENEFICIAL INTERESTS IN A RULE 144A GLOBAL SECURITY OR AN
IAI GLOBAL SECURITY MAY BE TRANSFERRED TO A PERSON WHO TAKES DELIVERY IN THE
FORM OF AN INTEREST IN THE REGULATION S GLOBAL SECURITY, WHETHER BEFORE OR
AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, ONLY IF THE
TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM
ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT SUCH TRANSFER IS BEING MADE
IN ACCORDANCE WITH RULE 903 OR 904 OF REGULATION S OR RULE 144 (IF AVAILABLE).
[Definitive Securities Legend]
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS
SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER
COMPLIES WITH THE FOREGOING RESTRICTIONS.
No. $
------------- -------
97/8% Senior Notes Due 0000
Xxxxxxx Xxxxx Xxxxxxx, Inc., a Delaware corporation, promises
to pay to , or registered assigns, the principal sum of
Dollars on March 1, 2014.
Interest Payment Dates: March 1 and September 1.
Record Dates: February 15 and August 15.
Additional provisions of this Security are set forth on the
other side of this Security.
Dated: March 8, 0000
XXXXXXX XXXXX XXXXXXX, INC.
By
--------------------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
U.S. BANK NATIONAL ASSOCIATION
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By
-----------------------------------------------------
Authorized Signatory
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
97/8% Senior Notes Due 2014
1. Interest
Fedders North America, Inc., a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), promises to pay interest on
the principal amount of this Security at the rate per annum shown above;
provided, however, that if a Registration Default (as defined in the
Registration Rights Agreement) occurs, Additional Interest will accrue on this
Security at a rate of 0.25% per annum (increasing by an additional 0.25% per
annum after each consecutive 90-day period that occurs after the date on which
such Registration Default occurs up to a maximum Additional Interest rate of
1.00%) from and including the date on which any such Registration Default
shall occur to but excluding the date on which all Registration Defaults have
been cured. The Company will pay interest semiannually on March 1 and
September 1 of each year, commencing September 1, 2004. Interest on the
Securities will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from March 8, 2004. 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 Securities (except
defaulted interest) to the Persons who are registered holders of Securities at
the close of business on the February 15 or August 15 next preceding the
interest payment date even if Securities are canceled after the record date
and on or before the interest payment date. Holders must surrender Securities
to a Paying Agent to collect principal payments. The Company will pay
principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts. Payments in
respect of the Securities represented by a Global Security (including
principal, premium and interest) will be made by wire transfer of immediately
available funds to the accounts specified by The Depository Trust Company. The
Company will make all payments in respect of a certificated Security
(including principal, premium and interest) by mailing a check to the
registered address of each Holder thereof; provided, however, that payments on
a certificated Security will be made by wire transfer to a U.S. dollar account
maintained by the payee with a bank in the United States if such Holder elects
payment by wire transfer by giving written notice to the Trustee or the Paying
Agent to such effect designating such account no later than 30 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, U.S. Bank National Association (the "Trustee")
will act as Paying Agent and Registrar. The Company may appoint and change any
Paying Agent, Registrar or co-registrar without notice. The Company or any of
its domestically incorporated wholly owned Subsidiaries may act as Paying
Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated
as of March 8, 2004 (the "Indenture"), among the Company, the Guarantors and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act
of 1939 (15 U.S.C. xx.xx. 77aaa-77bbbb) as in effect on the date of the
Indenture (the "Act"). Terms defined in the Indenture and not defined herein
have the meanings ascribed thereto in the Indenture. The Securities are
subject to all such terms, and Securityholders are referred to the Indenture
and the Act for a statement of those terms.
The Securities are general unsecured obligations of the
Company. The Company shall be entitled, subject to its compliance with Section
4.04 of the Indenture, to issue Additional Securities pursuant to Section 2.15
of the Indenture. The Initial Securities issued on the Issue Date, any
Additional Securities and all Exchange Securities or Private Exchange
Securities issued in exchange therefor will be treated as a single class for
all purposes under the Indenture. The Indenture contains covenants that limit
the ability of the Company and its subsidiaries to incur additional
indebtedness; pay dividends or distributions on, or redeem or repurchase
capital stock; make investments; engage in transactions with affiliates;
create liens on assets; transfer or sell assets; guarantee indebtedness;
restrict dividends or other payments of subsidiaries; consolidate, merge or
transfer all or substantially all of its assets and the assets of its
subsidiaries and engage in sale/leaseback transactions. These covenants are
subject to important exceptions and qualifications.
5. Optional Redemption
The Securities will be redeemable, at the option of the
Company, on or after March 1, 2009. During the 12-month period beginning on
March 1 of the years indicated below, the Securities will be redeemable, at
the option of the Company, in whole or in part, on at least 30 but not more
than 60 days' notice to each Holder of Securities to be redeemed, at the
redemption prices (expressed as percentages of the principal amount) set forth
below, plus any accrued and unpaid interest and Additional Interest, if any,
to the redemption date:
Redemption
Period Price
-------------- --------------
2009 104.938%
2010 103.292%
2011 101.646%
2012 and thereafter 100.000%
In addition, at any time on or before March 1, 2007, the
Company may (but will not have the obligation to) redeem for cash up to 35% of
the original aggregate principal amount of the Securities (including the
original aggregate principal amount of any Additional Securities issued under
the Indenture) at a redemption price of 109.875% of the principal amount
thereof, in each case plus any accrued and unpaid interest and Additional
Interest, if any, thereon to the redemption date, with the net proceeds of an
Equity Offering; provided that at least 65% of the original principal amount
of the Securities (including the original aggregate principal amount of any
Additional Securities issued under the Indenture) remains outstanding
immediately after the occurrence of such redemption; and provided, further,
that such redemption will occur within 60 days of the date of the closing of
such Equity Offering.
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the redemption date to each Holder of Securities to
be redeemed at his registered address. Securities in denominations larger than
$1,000 principal amount may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued
interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date
interest ceases to accrue on such Securities (or such portions thereof) called
for redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities will have
the right to cause the Company to repurchase all or any part of the Securities
of such Holder at a repurchase price equal to 101% of the principal amount of
the Securities to be repurchased plus accrued and unpaid interest to the date
of repurchase (subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest payment date) as
provided in, and subject to the terms of, the Indenture.
8. Guaranty
The payment by the Company of the principal of, and premium
and interest on, the Securities is fully and unconditionally guaranteed on a
joint and several senior basis by each of the Guarantors to the extent set
forth in the Indenture.
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of $1,000 principal amount and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the
transfer of or exchange any Securities selected for redemption (except, in the
case of a Security to be redeemed in part, the portion of the Security not to
be redeemed) or any Securities for a period of 15 days before a selection of
Securities to be redeemed or 15 days before an interest payment date.
10. Persons Deemed Owners
The registered Holder of this Security may be treated as the
owner of it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back
to the Company at its request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must
look only to the Company and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any time shall
be entitled to terminate some or all of its and the Guarantors' obligations
under the Securities and the Indenture if the Company deposits with the
Trustee money or U.S. Government Obligations for the payment of principal and
interest on the Securities to redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture,
(a) the Indenture and the Securities may be amended with the written consent
of the Holders of at least a majority in principal amount outstanding of the
Securities and (b) any existing Default or Event of Default (other than a
payment default) or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding
of the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and the Trustee shall
be entitled to amend the Indenture or the Securities to cure any ambiguity,
defect or inconsistency, or to comply with Article 5 of the Indenture, or to
provide for uncertificated Securities in addition to or in place of
certificated Securities, or to comply with the Trust Indenture Act or to make
any change that does not materially adversely affect the legal rights of any
Securityholder.
14. Defaults and Remedies
Under the Indenture, Events of Default include (a) default
for 30 days in payment of interest on the Securities; (b) default in payment
when due of principal or premium, if any, on the Securities; (c) failure by
the Company, Fedders Corporation or any Subsidiary Guarantor to comply with
other agreements in the Indenture or the Securities, in certain cases subject
to notice and lapse of time; (d) certain accelerations (including failure to
pay after giving effect to any extensions thereof) of other Indebtedness of
the Company, Fedders Corporation or a Restricted Subsidiary if the amount
accelerated (or so unpaid) exceeds $10.0 million; (e) certain events of
bankruptcy or insolvency with respect to the Company, Fedders Corporation and
the Significant Subsidiaries; (f) certain judgments or decrees for the payment
of money in excess of $10.0 million; and (g) certain defaults with respect to
Guarantees. Upon the occurrence of an Event of Default, the Trustee or the
Holders of at least 25% in principal amount of the Securities may declare all
the Securities to be due and payable immediately by notice in writing to the
Company and the Trustee specifying the respective Event of Default and that it
is a notice of acceleration.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives indemnity or
security satisfactory to it. Subject to certain limitations, Holders of a
majority in principal amount of the Securities may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Securityholders
notice of any continuing Default (except a Default in payment of principal or
interest) if it determines that withholding notice is in the interest of the
Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act, the
Trustee under the Indenture, in its individual or any other capacity, may
become the owner or pledgee of Securities and may otherwise deal with and
collect obligations owed to it by the Company or its Affiliates and may
otherwise deal with the Company or its Affiliates with the same rights it
would have if it were not Trustee.
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of
the Company or the Trustee shall not have any liability for any obligations of
the Company under the Securities or the Indenture or for any claim based on,
in respect of or by reason of such obligations or their creation. By accepting
a Security, each Securityholder waives and releases all such liability. The
waiver and release are part of the consideration for the issue of the
Securities.
17. Authentication
This Security shall not be valid until an authorized
signatory of the Trustee (or an authenticating agent) manually signs the
certificate of authentication on the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with rights of
survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A
(=Uniform Gift to Minors Act).
19. 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 Securities and has directed the Trustee to use
CUSIP numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
20. Holders' Compliance with Registration Rights Agreement
Each Holder of a Security, by acceptance hereof,
acknowledges and agrees to the provisions of the Registration Rights
Agreement, including the obligations of the Holders with respect to a
registration and the indemnification of the Company to the extent provided
therein.
21. Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT
TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written
request and without charge to the Security holder a copy of the Indenture
which has in it the text of this Security in larger type. Requests may be made
to:
Fedders North America, Inc.
000 Xxxxxxxxxxxx Xxxx
Xxxxxxx Xxxxxx, Xxx Xxxxxx 00000-0000
Attention: [Vice President and General Counsel]
________________________________________________________________________________
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security 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 other side of this Security.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in
Rule 144(k) under the Securities Act after the later of the date of original
issuance of such Securities and the last date, if any, on which such
Securities were owned by the Company or any Affiliate of the Company, the
undersigned confirms that such Securities are being transferred in accordance
with its terms:
CHECK ONE BOX BELOW
|_| to the Company; or
|_| pursuant to an effective registration statement under
the Securities Act of 1933; or
|_| inside the United States to a "qualified
institutional buyer" (as defined in Rule 144A under
the Securities Act of 1933) that purchases for its
own account or for the account of a qualified
institutional buyer to whom notice is given that
such transfer is being made in reliance on Rule
144A, in each case pursuant to and in compliance
with Rule 144A under the Securities Act of 1933; or
|_| outside the United States in an offshore
transaction within the meaning of Regulation S
under the Securities Act in compliance with Rule
904 under the Securities Act of 1933; or
|_| pursuant to the exemption from registration provided
by Rule 144 under the Securities Act of 1933; or
|_| to an institutional "accredited investor" (as
defined in Rule 501(a)(1),(2),(3) or (7) under the
Securities Act of 1933) that has furnished to the
Trustee a signed letter containing certain
representations and agreements.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however, that
if box (4), (5) or (6) is checked, the Trustee shall be entitled to
require, prior to registering any such transfer of the Securities, such
legal opinions, certifications and other information as the Company has
reasonably requested to confirm that such transfer is being made pursuant
to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
_____________________________________
Signature
Signature Guarantee:
_____________________________________ _____________________________________
Signature must be guaranteed Signature
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
________________________________________________________________________________
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is
purchasing this Security for its own account or an account with respect to
which it exercises sole investment discretion and that it and any such account
is a "qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that
the transferor is relying upon the undersigned's foregoing representations in
order to claim the exemption from registration provided by Rule 144A.
Dated:__________________________________ _____________________________________
Notice: To be executed by
an executive officer
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security
have been made:
Date of Amount of decrease Amount of increase Principal amount of Signature of
Exchange in Principal amount in Principal amount this Global Security authorized officer
of this Global of this Global following such of Trustee or
Security Security decrease or increase Securities Custodian
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.05 or 4.14 of the Indenture, check the box:
______
|______|
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.05 or 4.14 of the Indenture,
state the amount in principal amount: $
Dated:__________________ Your Signature:_____________________________________
(Sign exactly as your name appears
on the other side of this Security.)
Signature Guarantee:____________________________________________________________
(Signature must be guaranteed)
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
EXHIBIT 2
[FORM OF FACE OF EXCHANGE SECURITY
OR PRIVATE EXCHANGE SECURITY] */**/
_______________________
*/ [If the Security is to be issued in global form add the Global Securities
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "[TO BE ATTACHED TO GLOBAL SECURITIES] - SCHEDULE OF INCREASES OR
DECREASES IN GLOBAL SECURITY".]
**/ [If the Security is a Private Exchange Security issued in a Private
Exchange to an Initial Purchaser holding an unsold portion of its initial
allotment, add the Restricted Securities Legend from Exhibit 1 to Appendix A
and replace the Assignment Form included in this Exhibit 2 with the Assignment
Form included in such Exhibit 1.]
No. $
------------- -------
97/8% Senior Notes Due 0000
Xxxxxxx Xxxxx Xxxxxxx, Inc., a Delaware corporation, promises to pay to
, or registered assigns, the principal sum of
Dollars on March 1, 2014.
Interest Payment Dates:____March 1 and September 1.
Record Dates: February 15 and August 15.
Additional provisions of this Security are set forth on the other
side of this Security.
Dated: March 8, 0000
XXXXXXX XXXXX XXXXXXX, INC.
By
--------------------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
U.S. BANK NATIONAL ASSOCIATION
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By
----------------------------------------------
Authorized Signatory
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY
OR PRIVATE EXCHANGE SECURITY]
97/8% Senior Notes Due 2014
1. Interest
Fedders North America, Inc., a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), promises to pay interest on
the principal amount of this Security at the rate per annum shown above;
provided, however, that if a Registration Default (as defined in the
Registration Rights Agreement) occurs, Additional Interest will accrue on this
Security at a rate of 0.25% per annum (increasing by an additional 0.25% per
annum after each consecutive 90-day period that occurs after the date on which
such Registration Default occurs up to a maximum Additional Interest rate of
1.00%) from and including the date on which any such Registration Default
shall occur to but excluding the date on which all Registration Defaults have
been cured. The Company will pay interest semiannually on March 1 and
September 1 of each year, commencing September 1, 2004. Interest on the
Securities will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from March 8, 2004. 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 Securities (except
defaulted interest) to the Persons who are registered holders of Securities at
the close of business on the February 15 or August 15 next preceding the
interest payment date even if Securities are canceled after the record date
and on or before the interest payment date. Holders must surrender Securities
to a Paying Agent to collect principal payments. The Company will pay
principal and interest in money of the United States that at the time of
payment is legal tender for payment of public and private debts. Payments in
respect of the Securities represented by a Global Security (including
principal, premium and interest) will be made by wire transfer of immediately
available funds to the accounts specified by The Depository Trust Company. The
Company will make all payments in respect of a certificated Security
(including principal, premium and interest) by mailing a check to the
registered address of each Holder thereof; provided, however, that payments on
a certificated Security will be made by wire transfer to a U.S. dollar account
maintained by the payee with a bank in the United States if such Holder elects
payment by wire transfer by giving written notice to the Trustee or the Paying
Agent to such effect designating such account no later than 30 days
immediately preceding the relevant due date for payment (or such other date as
the Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, U.S. Bank National Association (the "Trustee")
will act as Paying Agent and Registrar. The Company may appoint and change any
Paying Agent, Registrar or co-registrar without notice. The Company or any of
its domestically incorporated wholly owned Subsidiaries may act as Paying
Agent, Registrar or co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated
as of March 8, 2004 (the "Indenture"), among the Company, the Guarantors and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act
of 1939 (15 U.S.C. xx.xx. 77aaa-77bbbb) as in effect on the date of the
Indenture (the "Act"). Terms defined in the Indenture and not defined herein
have the meanings ascribed thereto in the Indenture. The Securities are
subject to all such terms, and Securityholders are referred to the Indenture
and the Act for a statement of those terms.
The Securities are general unsecured obligations of the
Company. The Company shall be entitled, subject to its compliance with Section
4.04 of the Indenture, to issue Additional Securities pursuant to Section 2.15
of the Indenture. The Initial Securities issued on the Issue Date, any
Additional Securities and all Exchange Securities or Private Exchange
Securities issued in exchange therefor will be treated as a single class for
all purposes under the Indenture. The Indenture contains covenants that limit
the ability of the Company and its subsidiaries to incur additional
indebtedness; pay dividends or distributions on, or redeem or repurchase
capital stock; make investments; engage in transactions with affiliates;
create liens on assets; transfer or sell assets; guarantee indebtedness;
restrict dividends or other payments of subsidiaries; consolidate, merge or
transfer all or substantially all of its assets and the assets of its
subsidiaries; and engage in sale/leaseback transactions. These covenants are
subject to important exceptions and qualifications.
5. Optional Redemption
The Securities will be redeemable, at the option of the
Company, on or after March 1, 2009. During the 12-month period beginning on
March 1 of the years indicated below, the Securities will be redeemable, at
the option of the Company, in whole or in part, on at least 30 but not more
than 60 days' notice to each Holder of Securities to be redeemed, at the
redemption prices (expressed as percentages of the principal amount) set forth
below, plus any accrued and unpaid interest and Additional Interest, if any,
to the redemption date:
Redemption
Period Price
----------------- -----------------
2009 104.938%
2010 103.292%
2011 101.646%
2012 and thereafter 100.000%
In addition, at any time on or before March 1, 2007, the
Company may (but will not have the obligation to) redeem for cash up to 35% of
the original aggregate principal amount of the Securities (including the
original aggregate principal amount of any Additional Securities issued under
the Indenture) at a redemption price of 109.875% of the principal amount
thereof, in each case plus any accrued and unpaid interest and Additional
Interest, if any, thereon to the redemption date, with the net proceeds of an
Equity Offering; provided that at least 65% of the original principal amount
of the Securities (including the original aggregate principal amount of any
Additional Securities issued under the Indenture) remains outstanding
immediately after the occurrence of such redemption; and provided, further,
that such redemption will occur within 60 days of the date of the closing of
such Equity Offering..
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the redemption date to each Holder of Securities to
be redeemed at his registered address. Securities in denominations larger than
$1,000 principal amount may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued
interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date
interest ceases to accrue on such Securities (or such portions thereof) called
for redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities will have
the right to cause the Company to repurchase all or any part of the Securities
of such Holder at a repurchase price equal to 101% of the principal amount of
the Securities to be repurchased plus accrued and unpaid interest to the date
of repurchase (subject to the right of Holders of record on the relevant
record date to receive interest due on the related interest payment date) as
provided in, and subject to the terms of, the Indenture.
8. Guaranty
The payment by the Company of the principal of, and premium
and interest on, the Securities is fully and unconditionally guaranteed on a
joint and several senior basis by each of the Guarantors to the extent set
forth in the Indenture.
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of $1,000 principal amount and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the
transfer of or exchange any Securities selected for redemption (except, in the
case of a Security to be redeemed in part, the portion of the Security not to
be redeemed) or any Securities for a period of 15 days before a selection of
Securities to be redeemed or 15 days before an interest payment date.
10. Persons Deemed Owners
The registered Holder of this Security may be treated as the
owner of it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back
to the Company at its request unless an abandoned property law designates
another Person. After any such payment, Holders entitled to the money must
look only to the Company and not to the Trustee for payment.
12. Discharge and Defeasance
Subject to certain conditions, the Company at any time shall
be entitled to terminate some or all of its and the Guarantors' obligations
under the Securities and the Indenture if the Company deposits with the
Trustee money or U.S. Government Obligations for the payment of principal and
interest on the Securities to redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture,
(a) the Indenture and the Securities may be amended with the written consent
of the Holders of at least a majority in principal amount outstanding of the
Securities and (b) any existing Default or Event of Default (other than a
payment default) or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding
of the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and the Trustee shall
be entitled to amend the Indenture or the Securities to cure any ambiguity,
defect or inconsistency, or to comply with Article 5 of the Indenture, or to
provide for uncertificated Securities in addition to or in place of
certificated Securities, or to comply with the Trust Indenture Act or to make
any change that does not materially adversely affect the legal rights of any
Securityholder.
14. Defaults and Remedies
Under the Indenture, Events of Default include (a) default
for 30 days in payment of interest on the Securities; (b) default in payment
when due of principal or premium, if any, on the Securities; (c) failure by
the Company, Fedders Corporation or any Subsidiary Guarantor to comply with
other agreements in the Indenture or the Securities, in certain cases subject
to notice and lapse of time; (d) certain accelerations (including failure to
pay after giving effect to any extensions thereof) of other Indebtedness of
the Company, Fedders Corporation or a Restricted Subsidiary if the amount
accelerated (or so unpaid) exceeds $10.0 million; (e) certain events of
bankruptcy or insolvency with respect to the Company, Fedders Corporation and
the Significant Subsidiaries; (f) certain judgments or decrees for the payment
of money in excess of $10.0 million; and (g) certain defaults with respect to
Guarantees. Upon the occurrence of an Event of Default, the Trustee or the
Holders of at least 25% in principal amount of the Securities may declare all
the Securities to be due and payable immediately by notice in writing to the
Company and the Trustee specifying the respective Event of Default and that it
is a notice of acceleration.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives indemnity or
security satisfactory to it. Subject to certain limitations, Holders of a
majority in principal amount of the Securities may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Securityholders
notice of any continuing Default (except a Default in payment of principal or
interest) if it determines that withholding notice is in the interest of the
Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Act, the
Trustee under the Indenture, in its individual or any other capacity, may
become the owner or pledgee of Securities and may otherwise deal with and
collect obligations owed to it by the Company or its Affiliates and may
otherwise deal with the Company or its Affiliates with the same rights it
would have if it were not Trustee.
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of
the Company or the Trustee shall not have any liability for any obligations of
the Company under the Securities or the Indenture or for any claim based on,
in respect of or by reason of such obligations or their creation. By accepting
a Security, each Securityholder waives and releases all such liability. The
waiver and release are part of the consideration for the issue of the
Securities.
17. Authentication
This Security shall not be valid until an authorized
signatory of the Trustee (or an authenticating agent) manually signs the
certificate of authentication on the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with rights of
survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A
(=Uniform Gift to Minors Act).
19. 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 Securities and has directed the Trustee to use
CUSIP numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
20. Holders; Compliance with Registration Rights Agreement
Each Holder of a Security, by acceptance hereof,
acknowledges and agrees to the provisions of the Registration Rights
Agreement, including the obligations of the Holders with respect to a
registration and the indemnification of the Company to the extent provided
therein.
21. Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT
TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
The Company will furnish to any Securityholder upon written
request and without charge to the Security holder a copy of the Indenture
which has in it the text of this Security in larger type. Requests may be made
to:
Fedders North America, Inc.
000 Xxxxxxxxxxxx Xxxx
Xxxxxxx Xxxxxx, Xxx Xxxxxx 00000-0000
Attention: [Vice President and General Counsel]
________________________________________________________________________________
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security 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 other side of this Security.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in
Rule 144(k) under the Securities Act after the later of the date of original
issuance of such Securities and the last date, if any, on which such
Securities were owned by the Company or any Affiliate of the Company, the
undersigned confirms that such Securities are being transferred in accordance
with its terms:
CHECK ONE BOX BELOW
|_| to the Company; or
|_| pursuant to an effective registration statement under
the Securities Act of 1933; or
|_| inside the United States to a "qualified
institutional buyer" (as defined in Rule 144A under
the Securities Act of 1933) that purchases for its
own account or for the account of a qualified
institutional buyer to whom notice is given that
such transfer is being made in reliance on Rule
144A, in each case pursuant to and in compliance
with Rule 144A under the Securities Act of 1933; or
|_| outside the United States in an offshore
transaction within the meaning of Regulation S
under the Securities Act in compliance with Rule
904 under the Securities Act of 1933; or
|_| pursuant to the exemption from registration provided
by Rule 144 under the Securities Act of 1933; or
|_| to an institutional "accredited investor" (as
defined in Rule 501(a)(1),(2),(3) or (7) under the
Securities Act of 1933) that has furnished to the
Trustee a signed letter containing certain
representations and agreements.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however, that
if box (4), (5) or (6) is checked, the Trustee shall be entitled to
require, prior to registering any such transfer of the Securities, such
legal opinions, certifications and other information as the Company has
reasonably requested to confirm that such transfer is being made pursuant
to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933.
_____________________________________
Signature
Signature Guarantee:
_____________________________________ _____________________________________
Signature must be guaranteed Signature
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
________________________________________________________________________________
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is
purchasing this Security for its own account or an account with respect to
which it exercises sole investment discretion and that it and any such account
is a "qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that
the transferor is relying upon the undersigned's foregoing representations in
order to claim the exemption from registration provided by Rule 144A.
Dated:__________________________________ _____________________________________
Notice: To be executed by
an executive officer
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security
have been made:
Date of Amount of decrease Amount of increase Principal amount of Signature of
Exchange in Principal amount in Principal amount this Global Security authorized officer
of this Global of this Global following such of Trustee or
Security Security decrease or increase Securities Custodian
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.05 or 4.14 of the Indenture, check the box:
______
|______|
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.05 or 4.14 of the Indenture,
state the amount in principal amount: $
Dated:__________________ Your Signature:_____________________________________
(Sign exactly as your name appears
on the other side of this Security.)
Signature Guarantee:____________________________________________________________
(Signature must be guaranteed)
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
EXHIBIT 3
Form of Transferee Letter of Representation
FEDDERS NORTH AMERICA
000 Xxxxxxxxxxxx Xxxx
Xxxxxxx Xxxxxx, Xxx Xxxxxx 00000-0000
In care of
[Vice President and General Counsel]
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $[ ]
principal amount of the 97/8% Senior Notes Due 2014 (the "Securities") of
Fedders North America (the "Company").
Upon transfer, the Securities would be registered in the name of the
new beneficial owner as follows:
Name: _________________________________________________________________
Address: ______________________________________________________________
Taxpayer ID Numbers: __________________________________________________
The undersigned represents and warrants to you that:
We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933 (the "Securities
Act")), purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount of the
Securities, and we are acquiring the Securities not with a view to, or for
offer or sale in connection with, any distribution in violation of the
Securities Act. We 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 Securities, and we invest in or purchase securities similar
to the Securities in the normal course of our business. We, and any accounts
for which we are acting, are each able to bear the economic risk of our or its
investment.
We understand that the Securities have not been registered under the
Securities Act and, unless so registered, may not be sold except as permitted
in the following sentence. We agree on our own behalf and on behalf of any
investor account for which we are purchasing Securities to offer, sell or
otherwise transfer such Securities prior to the date that is two years after
the later of the date of original issue and the last date on which the Company
or any Affiliate of the Company was the owner of such Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date") only (i) to
the Company, (ii) in the United States to a person whom the seller reasonably
believes is a qualified institutional buyer in a transaction meeting the
requirements of Rule 144A, (iii) to an institutional "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act
that is an institutional accredited investor purchasing for its own account or
for the account of an institutional accredited investor, in each case in a
minimum principal amount of the Securities of $250,000, (iv) outside the
United States in a transaction complying with the provisions of Rule 904 under
the Securities Act, (v) pursuant to an exemption from registration under the
Securities Act provided by Rule 144 (if available) or (vi) pursuant to an
effective registration statement under the Securities Act, in each of cases
(i) through (vi) subject to any requirement of law that the disposition of our
property or the property of such investor account or accounts be at all times
within our or their control and in compliance with any applicable state
securities laws. The foregoing restrictions on resale will not apply
subsequent to the Resale Restriction Termination Date. If any resale or other
transfer of the Securities is proposed to be made pursuant to clause (iii)
above prior to the Resale Restriction Termination Date, the transferor shall
deliver a letter from the transferee substantially in the form of this letter
to the Company and the Trustee, which shall provide, among other things, that
the transferee is an institutional "accredited investor" within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Securities Act and that it is
acquiring such Securities for investment purposes and not for distribution in
violation of the Securities Act. Each purchaser acknowledges that the Company
and the Trustee reserve the right prior to the offer, sale or other transfer
prior to the Resale Restriction Termination Date of the Securities pursuant to
clause (iii), (iv) or (v) above to require the delivery of an opinion of
counsel, certifications or other information satisfactory to the Company and
the Trustee.
TRANSFEREE
By
---------------------------------------
Name:
Title:
