Exhibit 4.1(a)
[EXECUTION COPY]
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PAHC HOLDINGS CORPORATION
AS ISSUER
AND
HSBC BANK USA, NATIONAL ASSOCIATION
AS TRUSTEE AND AS COLLATERAL AGENT
INDENTURE
DATED AS OF FEBRUARY 10, 2005
$29,000,000 PRINCIPAL AMOUNT OF 15% SENIOR SECURED NOTES DUE 2010
OF PAHC HOLDINGS CORPORATION
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TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
PAGE
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SECTION 1.01. Definitions............................................. 1
SECTION 1.02. Other Definitions....................................... 17
SECTION 1.03. TIA..................................................... 18
SECTION 1.04. Rules of Construction................................... 19
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating......................................... 19
SECTION 2.02. Execution and Authentication; Aggregate Principal
Amount............................................... 20
SECTION 2.03. Registrar and Paying Agent.............................. 21
SECTION 2.04. Paying Agent to Hold Assets in Trust.................... 21
SECTION 2.05. Holder Lists............................................ 21
SECTION 2.06. Transfer and Exchange................................... 22
SECTION 2.07. Replacement Notes....................................... 22
SECTION 2.08. Outstanding Notes....................................... 22
SECTION 2.09. Treasury Notes.......................................... 23
SECTION 2.10. Temporary Notes......................................... 23
SECTION 2.11. Cancellation............................................ 23
SECTION 2.12. Defaulted Interest...................................... 23
SECTION 2.13. CUSIP Number............................................ 24
SECTION 2.14. Deposit of Monies....................................... 24
SECTION 2.15. Restrictive Legends..................................... 24
SECTION 2.16. Book-Entry Provisions for Global Notes.................. 24
SECTION 2.17. Registration of Transfers and Exchanges................. 25
SECTION 2.18. Additional Interest Under Registration Rights
Agreement............................................ 29
SECTION 2.19. Issuance of PIK Notes................................... 29
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee...................................... 30
SECTION 3.02. Selection of Notes To Be Redeemed....................... 30
SECTION 3.03. Redemptions............................................. 30
SECTION 3.04. Notice of Redemption.................................... 31
SECTION 3.05. Effect of Notice of Redemption.......................... 32
SECTION 3.06. Deposit of Redemption Price............................. 32
SECTION 3.07. Notes Redeemed in Part.................................. 32
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes........................................ 32
SECTION 4.02. Maintenance of Office or Agency......................... 33
SECTION 4.03. Corporate Existence..................................... 33
SECTION 4.04. Payment of Taxes and Other Claims....................... 33
SECTION 4.05. Maintenance of Properties and Insurance................. 33
SECTION 4.06. Compliance Certificate; Notice of Default............... 34
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TABLE OF CONTENTS
(continued)
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SECTION 4.07. Compliance with Laws.................................... 34
SECTION 4.08. Provision of Financial Statements and Information....... 34
SECTION 4.09. Waiver of Stay, Extension or Usury Laws................. 35
SECTION 4.10. Limitation on Restricted Payments....................... 35
SECTION 4.11. Limitation on Transactions with Affiliates.............. 37
SECTION 4.12. Limitation on Incurrence of Indebtedness................ 38
SECTION 4.13. Limitation on Dividends and Other Payment Restrictions
Affecting Restricted Subsidiaries.................... 41
SECTION 4.14. Limitation on Designation of Unrestricted Subsidiaries.. 42
SECTION 4.15. Change of Control....................................... 43
SECTION 4.16. Limitation on Asset Sales............................... 44
SECTION 4.17. Impairment of Security Interest......................... 46
SECTION 4.18. Limitation on Liens..................................... 46
SECTION 4.19. Business Activities..................................... 46
SECTION 4.20. Payments for Consent.................................... 46
SECTION 4.21. Limitation on Issuances and Sales of Capital Stock of
Subsidiaries......................................... 46
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Merger, Consolidation and Sale of Assets................ 47
SECTION 5.02. Successor Corporation Substituted....................... 48
ARTICLE SIX
REMEDIES
SECTION 6.01. Events of Default....................................... 48
SECTION 6.02. Acceleration............................................ 49
SECTION 6.03. Other Remedies.......................................... 50
SECTION 6.04. Waiver of Past Defaults................................. 50
SECTION 6.05. Control by Majority..................................... 50
SECTION 6.06. Limitation on Suits..................................... 50
SECTION 6.07. Right of Holders to Receive Payment..................... 51
SECTION 6.08. Collection Suit by Trustee.............................. 51
SECTION 6.09. Trustee May File Proofs of Claim........................ 51
SECTION 6.10. Priorities.............................................. 51
SECTION 6.11. Undertaking for Costs................................... 52
SECTION 6.12. Restoration of Rights and Remedies...................... 52
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee....................................... 52
SECTION 7.02. Rights of Trustee....................................... 53
SECTION 7.03. Individual Rights of Trustee............................ 54
SECTION 7.04. Trustee's Disclaimer.................................... 54
SECTION 7.05. Notice of Default....................................... 54
SECTION 7.06. Reports by Trustee to Holders........................... 55
SECTION 7.07. Compensation and Indemnity.............................. 55
SECTION 7.08. Replacement of Trustee.................................. 56
SECTION 7.09. Successor Trustee by Merger, Etc........................ 56
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TABLE OF CONTENTS
(continued)
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SECTION 7.10. Eligibility; Disqualification........................... 57
SECTION 7.11. Preferential Collection of Claims Against the Issuer.... 57
SECTION 7.12. Trustee as Collateral Agent............................. 57
SECTION 7.13. Co-Trustees, Co-Collateral Agents, Sub-Collateral
Agent, Separate Trustees and Separate Collateral
Agents............................................... 57
ARTICLE EIGHT
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 8.01. Satisfaction and Discharge of Indenture................. 59
SECTION 8.02. Defeasance or Covenant Defeasance....................... 59
SECTION 8.03. Application of Trust Money.............................. 60
SECTION 8.04. Repayment to the Issuer................................. 61
SECTION 8.05. Reinstatement........................................... 61
SECTION 8.06. Acknowledgment of Discharge by Trustee.................. 61
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.............................. 61
SECTION 9.02. With Consent of Holders................................. 62
SECTION 9.03. Compliance with TIA..................................... 63
SECTION 9.04. Revocation and Effect of Consents....................... 63
SECTION 9.05. Notation on or Exchange of Notes........................ 63
SECTION 9.06. Trustee To Sign Amendments, Etc......................... 63
ARTICLE TEN
SECURITY
SECTION 10.01. Grant of Security Interest.............................. 64
SECTION 10.02. Recording and Opinions.................................. 64
SECTION 10.03. Release of Collateral................................... 65
SECTION 10.04. Specified Releases of Collateral........................ 66
SECTION 10.05. Form and Sufficiency of Release......................... 67
SECTION 10.06. Purchaser Protected..................................... 67
SECTION 10.07. Authorization of Actions To Be Taken by the Collateral
Agent Under the Collateral Agreements................ 67
SECTION 10.08. Authorization of Receipt of Funds by the Collateral
Agent Under the Collateral Agreements................ 68
SECTION 10.09. Limitation on Duty of Collateral Agent in Respect of
Collateral; Indemnification.......................... 68
SECTION 10.10. Rights of the Issuer.................................... 68
ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TIA Controls............................................ 69
SECTION 11.02. Notices................................................. 69
SECTION 11.03. Communications by Holders with Other Holders............ 70
SECTION 11.04. Certificate and Opinion as to Conditions Precedent...... 70
SECTION 11.05. Statements Required in Certificate or Opinion........... 70
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar............... 70
SECTION 11.07. Legal Holidays.......................................... 71
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TABLE OF CONTENTS
(continued)
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SECTION 11.08. Governing Law........................................... 71
SECTION 11.09. No Adverse Interpretation of Other Agreements........... 71
SECTION 11.10. No Personal Liability................................... 71
SECTION 11.11. Successors.............................................. 71
SECTION 11.12. Duplicate Originals..................................... 71
SECTION 11.13. Severability............................................ 71
SECTION 11.14. Jurisdiction; Waiver of Jury Trial...................... 71
SECTION 11.15. English Language........................................ 71
Exhibits
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Exhibit A - Form of Note
Exhibit B - Form of Exchange Note
Exhibit C - Form of Certificate To Be Delivered in Connection with Transfers to
Non-QIB Accredited Investors
Exhibit D - Form of Certificate To Be Delivered in Connection with Transfers
Pursuant to Regulation S
Exhibit E - Form of Certificate to be Delivered upon Exchange or Registration of
Transfer of Securities
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CROSS-REFERENCE TABLE
TIA Section Indenture Section
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310 (a)(1)................................................ 7.10
(a)(2)................................................ 7.10
(a)(3)................................................ N.A.
(a)(4)................................................ N.A.
(a)(5)................................................ 7.10; 7.11
(b)................................................... 7.08; 7.10; 11.02
(c)................................................... N.A.
311 (a)................................................... 7.11
(b)................................................... 7.11
(c)................................................... N.A.
312 (a)................................................... 2.05
(b)................................................... 11.03
(c)................................................... 11.03
313 (a)................................................... 7.06
(b)(1)................................................ 7.06
(b)(2)................................................ 7.06
(c)................................................... 7.06; 11.02
(d)................................................... 7.06
314 (a)................................................... 4.06; 4.08; 10.02
(b)................................................... N.A.
(c)(1)................................................ 7.02; 11.04
(c)(2)................................................ 7.02; 11.04
(c)(3)................................................ N.A.
(d)................................................... 10.03
(e)................................................... 11.05
(f)................................................... N.A.
315 (a)................................................... 7.01(b)
(b)................................................... 7.05; 11.02
(c)................................................... 7.01(a)
(d)................................................... 6.05; 7.01(c)
(e)................................................... 6.11
316 (a)(last sentence).................................... 2.09
(a)(1)(A)............................................. 6.05
(a)(1)(B)............................................. 6.04
(a)(2)................................................ N.A.
(b)................................................... 6.07
(c)................................................... 9.04
317 (a)(1)................................................ 6.08
(a)(2)................................................ 6.09
(b)................................................... 2.04
318 (a)................................................... 11.01
(c)................................................... 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 this Indenture.
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INDENTURE, dated as of February 10, 2005, between PAHC Holdings
Corporation, a Delaware corporation (the "Company" or "Issuer"), as the issuer,
and HSBC Bank USA, National Association, as trustee (in such capacity as the
"Trustee") and collateral agent (in such capacity, the "Collateral Agent").
WHEREAS, the Issuer has duly authorized the creation of its 15% Senior
Secured Notes due 2010 (the "Initial Notes"), the 15% Senior Secured Notes due
2010 (the "PIK Notes") to be issued in lieu of the payment of interest in cash
on any Note, the 15% Senior Secured Exchange Notes due 2010 (the "Exchange
Notes"). The Exchange Notes, the Initial Notes, any PIK Notes and any Additional
Notes shall collectively be referred to herein as the "Notes";
Each party hereto agrees as follows for the benefit of the other parties
and for the equal and ratable benefit of the Holders (as defined):
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"2007 Indenture" means the Indenture dated as of October 21, 2003 between
Phibro Animal Health, Philipp Brothers Netherlands III B.V., the guarantors
named therein, and HSBC Bank USA, National Association, as trustee and
collateral agent, as the same may be amended, modified, renewed, refunded or
refinanced from time to time.
"2008 Indenture" means the Indenture dated as of June 11, 1998 between
Phibro Animal Health, the guarantors named therein, and The Chase Manhattan
Bank, as trustee, as the same may be amended, modified, renewed, refunded or
refinanced from time to time.
"2007 Notes" means the outstanding 13% Senior Secured notes due 2007 of
Phibro Animal Health and Philipp Brothers Netherlands III B.V., as the same may
be amended, modified, renewed, refunded, refinanced or replaced from time to
time.
"2008 Notes" means Phibro Animal Health's outstanding 9.875% senior
subordinated notes due 2008 as the same may be amended, modified, renewed,
refunded, refinanced or replaced from time to time.
"Acquired Debt" means, with respect to any specified Person, Indebtedness
of any other Person (the "Acquired Person") existing at the time the Acquired
Person merges with or into, or becomes a Restricted Subsidiary of, such
specified Person, including Indebtedness incurred in connection with, or in
contemplation of, the Acquired Person merging with or into, or becoming a
Restricted Subsidiary of, such specified Person; provided, however, that
Indebtedness of such Acquired Person which is redeemed, defeased, retired or
otherwise repaid at the time of or immediately upon consummation of the
transactions by which such Acquired Person merges with or into or becomes a
Restricted Subsidiary of such specified Person shall not be Acquired Debt.
"Additional Interest" has the meaning set forth in the Registration Rights
Agreement.
"Administrative Agent" has the meaning set forth in the definition of the
term "Credit Agreement."
"Affiliate" means, with respect to any specified Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with") of any Person means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Asset Sale" means (i) any sale, lease, conveyance or other disposition by
the Company or any Restricted Subsidiary of any assets (including by way of a
sale-and-leaseback) other than in the ordinary course of business or (ii) the
issuance or sale of Capital Stock of any Restricted Subsidiary, in the case of
each of (i) and (ii), whether in a single transaction or a series of related
transactions, to any Person (other than (A) to the Company or any Restricted
Subsidiary, (B) directors' qualifying shares and (C) sales or grants of licenses
to use the patents, trade secrets, know-how and other intellectual property of
the Company or any of its Restricted Subsidiaries to the extent that such
license does not prohibit the Company and its Restricted Subsidiaries from using
the intellectual property so licensed or require the Company or any of its
Restricted Subsidiaries to pay any fees for such use) for Net Proceeds in excess
of $250,000.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal, state or
foreign law for the relief of debtors.
"Belgium Plant" means the plant owned by Phibro Belgium in Rixensart,
Belgium.
"Belgium Plant Sale and Virginiamycin Production Transactions" means the
following transactions and payments, including payments required pursuant to the
documents to evidence such transactions, each of which is subject to entering
into definitive documentation containing customary representations, warranties,
covenants and indemnities for a transaction of that type, and changes in the
definitive economic terms which are not, individually or in the aggregate,
material to the Company: (i) the transfer of substantially all of the land and
buildings and certain equipment of Phibro Belgium at the Belgium Plant, as well
as the industrial activities and intellectual property relating to certain
solvent technology of Phibro Belgium, for a purchase price of EUR 6.2 million,
payable at closing; (ii) the transfer to GSK of a majority of the employees of
Phibro Belgium and the corresponding responsibility for statutory severance
obligations; (iii) GSK agreeing to be responsible for costs of cleaning-up, by
demolition or otherwise, certain buildings not to be used by it, but for Phibro
Belgium to reimburse GSK up to a maximum of EUR 0.7 million for such clean-up
costs; (iv) in recognition of the benefits to the Company from the proposed
transaction, Phibro Belgium agreeing to pay to GSK EUR 1.5 million within six
months from the closing date, EUR 1.5 million within eighteen months from the
closing date, EUR 1.5 million within thirty months from the closing date, and
EUR 0.5 million within forty-two months from the closing date; (v) Phibro
Belgium retaining certain excess land (valued at approximately EUR 0.4 million)
and being able to sell such land for its own account; (vi) Phibro Belgium being
responsible for certain plant closure costs and legally required severance
indemnities in connection with workforce reductions, estimated in total to be
EUR 7.7 million, of which an amount estimated to be approximately EUR 4.1
million would be payable at or around the closing and an aggregate amount so
estimated to be approximately EUR 3.6 million would be payable over periods up
to thirteen years; and (vii) Phibro Belgium retaining any or all equipment at
the Belgium Plant, and being able to sell such equipment for the account of
Phibro Belgium or transfer such equipment, together with other assets and rights
related to
2
the production of virginiamycin, to the Company's Restricted Subsidiary in
Brazil that owns the facility in Guarulhos or in connection with alternative
production arrangements.
"Belgium Purchase Agreement" means a Purchase Agreement between Phibro
Belgium and GSK relating to the Belgium Plant Sale and Virginiamycin Production
Transactions, and any related or ancillary agreements or instruments entered
into by Phibro Belgium, GSK, their respective Affiliates and/or other persons in
connection with the Belgium Plant Sale and Virginiamycin Production
Transactions, in each case, as such agreements may be amended, modified or
supplemented (so long as such amendments, modifications or supplements are not,
individually or in the aggregate, materially adverse to the Company or the
Holders).
"Board of Directors" means, as to any Person, the board of directors of
such Person or any duly authorized committee thereof.
"Board Resolution" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day other than a Saturday, Sunday or any other day
on which banking institutions in the city of New York are required or authorized
by law or other governmental action to be closed.
"Capital Lease Obligation" of any Person means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease for property leased by such Person that would at such time be
required to be capitalized on the balance sheet of such Person in accordance
with GAAP.
"Capital Stock" of any Person means any and all shares, interests, rights
to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) corporate stock or other equity
participations, including partnership interests, whether general or limited, of
such Person, including any Preferred Stock.
"Cash Equivalents" means:
(i) marketable direct obligations issued by, or unconditionally
guaranteed by, the United States Government or issued by any agency or
instrumentality thereof and backed by the full faith and credit of the
United States, in each case maturing within one year from the date of
acquisition thereof;
(ii) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any
public instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's Rating Services or
Xxxxx'x Investors Service, Inc.;
(iii) commercial paper maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having a rating of at
least A-1 from Standard & Poor's Rating Services or at least P-1 from
Xxxxx'x Investors Service, Inc.;
3
(iv) certificates of deposit, time deposits or bankers' acceptances
(or, with respect to foreign banks, similar instruments) maturing within
one year from the date of acquisition thereof issued by any bank organized
under the laws of the United States of America or any state thereof or the
District of Columbia or any member of the European Union or any U.S. branch
of a foreign bank or (with respect to any Restricted Subsidiary) any
foreign country in which such Restricted Subsidiary is located, having at
the date of acquisition thereof combined capital and surplus of not less
than $250.0 million and a Xxxxxxxx or Xxxxx Bank Watch Rating of "B" or
better (including bank accounts in such banks);
(v) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clause (i) above entered
into with any bank meeting the qualifications specified in clause (iv)
above;
(vi) in the case of any Foreign Restricted Subsidiary, Investments:
(a) in direct obligations of the sovereign nation (or any agency or
instrumentality thereof) in which such Foreign Restricted Subsidiary is
organized or is conducting business or in obligations fully and
unconditionally guaranteed by such sovereign nation (or any agency or
instrumentality thereof), (b) of the type and maturity described in clauses
(i) through (v) above of foreign obligors, which Investments or obligors
(or the parents of such obligors) have ratings described in such clauses or
equivalent ratings from comparable foreign rating agencies or (c) of the
type and maturity described in clauses (i) through (v) above of foreign
obligors (or the parents of such obligors), which Investments or obligors
(or the parents of such obligors), are not rated as provided in such
clauses or in clause (vi)(b) but which are, in the reasonable judgment of
the Company, comparable in investment quality to such Investments and
obligors (or the parents of such obligors); and
(vii) investments in money market funds, including money market funds
administered by the Trustee, which invest substantially all their assets in
securities of the types described in clauses (i) through (vi) above.
"Cash Flow" means, with respect to any period, Consolidated Net Income for
such period, plus, to the extent deducted in computing such Consolidated Net
Income: (i) extraordinary net losses, plus (ii) provision for taxes based on
income or profits and any provision for taxes utilized in computing the
extraordinary net losses under clause (i) hereof, plus (iii) Consolidated
Interest Expense, plus (iv) depreciation, amortization and all other non-cash
charges (including amortization of goodwill and other intangibles but excluding
any items that will require cash payments in the future for which an accrual or
reserve is made), plus (v) any non-recurring fees, charges or other expenses
made or incurred by the Company in connection with the Transactions.
"Change of Control" means:
(a) with respect to the Company, the occurrence of any of the
following events after the Issue Date:
(i) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act) (other than one or more Permitted
Holders) is or becomes (including by merger, consolidation or
otherwise) the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act, except that a Person shall be deemed to have
beneficial ownership of all shares that such Person has the right to
acquire, whether such right is exercisable immediately or only after
the passage of time), directly or
4
indirectly, of 50% or more of the voting power of the total
outstanding Voting Stock of the Company;
(ii) during any period of two consecutive years, individuals who
at the beginning of such period constituted the Board of Directors of
the Company (together with any new directors whose election to such
Board of Directors, or whose nomination for election by the
stockholders of the Company, was approved by a vote of 66-2/3% of the
directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a
majority of such Board of Directors of the Company then in office; or
(iii) the approval by the holders of Capital Stock of the Company
of any plan or proposal for the liquidation or dissolution of the
Company (whether or not otherwise in compliance with the terms of this
Indenture); or
(b) the sale or other disposition (other than by way of merger or
consolidation) of all or substantially all of the Capital Stock or assets
of the Company and its Restricted Subsidiaries taken as a whole to any
Person or group (as defined in Rule 13d-5 of the Exchange Act) (other than
to one or more of the Permitted Holders) as an entirety or substantially as
an entirety in one transaction or a series of related transactions, unless
the "beneficial owners" of the Voting Stock of such Person immediately
prior to such transaction own, directly or indirectly, more than 50% of the
total voting power of such Person immediately after such transaction.
"Collateral" means Collateral as defined in the Collateral Agreements.
"Collateral Agent" means HSBC Bank USA, National Association, as collateral
agent, and any successor thereto in accordance with the terms of this Indenture.
"Collateral Agreements" means, collectively, the Security Agreement and the
Pledge Agreement.
"Commission" means the Securities and Exchange Commission.
"Common Stock" of any Person means any and all shares, interests or other
participations in, and other equivalents (however designated and whether voting
or non-voting) of such Person's common stock, whether outstanding on the Issue
Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.
"Consolidated Cash Flow Coverage Ratio" means, for any period, the ratio of
(i) the aggregate amount of Cash Flow for such period, to (ii) Consolidated
Interest Expense for such period, determined on a pro forma basis after giving
pro forma effect to (a) the incurrence of the Indebtedness giving rise to the
calculation of the Consolidated Cash Flow Coverage Ratio and (if applicable) the
application of the net proceeds therefrom, including to refinance other
Indebtedness, as if such Indebtedness was incurred, and the application of such
proceeds occurred, at the beginning of such period; (b) the incurrence,
repayment or retirement of any other Indebtedness by the Company and its
Restricted Subsidiaries since the first day of such period as if such
Indebtedness was incurred, repaid or retired at the beginning of such period
(except that, in making such computation, the amount of Indebtedness under any
revolving credit facility shall be computed based upon the average balance of
such Indebtedness at the end of each month during such period); (c) in the case
of Acquired Debt, the related acquisition as if such acquisition had occurred at
the beginning of such period; and (d) any acquisition or disposition by the
Company and its Restricted Subsidiaries of any company or any business or any
assets out of the ordinary course of
5
business, or any related repayment of Indebtedness, in each case since the first
day of such period, assuming such acquisition or disposition had been
consummated on the first day of such period.
"Consolidated Interest Expense" means, with respect to any period, the sum
of (i) the interest expense of the Company and its Restricted Subsidiaries for
such period, including, without limitation, (a) amortization of debt discount,
(b) the net payments, if any, under interest rate contracts (including
amortization of discounts), (c) the interest portion of any deferred payment
obligation and (d) accrued interest, plus (ii) the interest component of the
Capital Lease Obligations paid, accrued and/or scheduled to be paid or accrued
by the Company and its Restricted Subsidiaries during such period, and all
capitalized interest of the Company and its Restricted Subsidiaries, plus (iii)
all dividends paid during such period by the Company and its Restricted
Subsidiaries with respect to any Disqualified Stock (other than by any
Restricted Subsidiary to the Company or any other Restricted Subsidiary and
other than any dividend paid in Capital Stock (other than Disqualified Stock)),
in each case, as determined on a consolidated basis in accordance with GAAP
consistently applied.
"Consolidated Net Income" means, with respect to any period, the net income
(or loss) of the Company and its Restricted Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP consistently applied,
adjusted to the extent included in calculating such net income (or loss), by
excluding, without duplication:
(i) all extraordinary gains (less all fees and expenses relating
thereto);
(ii) the portion of net income (or loss) of the Company and its
Restricted Subsidiaries allocable to interests in unconsolidated Persons or
Unrestricted Subsidiaries, except to the extent of the amount of dividends
or distributions actually paid to the Company or its Restricted
Subsidiaries by such other Person during such period;
(iii) for purposes of Section 4.10, net income (or loss) of any Person
combined with the Company or any of its Restricted Subsidiaries on a
"pooling-of-interests" basis attributable to any period prior to the date
of combination;
(iv) net gains and losses (less all fees and expenses relating
thereto) in respect of disposition of assets (including, without
limitation, pursuant to sale and leaseback transactions) other than in the
ordinary course of business;
(v) the net income of any Restricted Subsidiary to the extent that the
declaration of dividends or similar distributions by that Restricted
Subsidiary of that income to the Company is not at the time permitted,
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;
(vi) the cumulative non-cash effect of any change in accounting
principles; provided that any net gain referred to in clause (iv) above
that relates to a Restricted Investment and which is received in or
converted into cash by the Company or a Restricted Subsidiary during such
period shall be included in the consolidated net income of the Company; and
(vii) the amount of accretions on preferred stock not paid in cash and
dividends paid in kind on preferred stock reducing Consolidated Net Income
in accordance with FASB 150.
"Consolidated Net Worth" means, with respect to any Person at any date, the
sum of (i) the consolidated stockholders' equity of such Person less the amount
of such stockholders' equity attributable
6
to Disqualified Stock of such Person and its Restricted Subsidiaries, as
determined on a consolidated basis in accordance with GAAP consistently applied
and (ii) the amount of any Preferred Stock of such Person not included in the
stockholders' equity of such Person in accordance with GAAP, which Preferred
Stock does not constitute Disqualified Stock.
"Corporate Trust Office" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Indenture is located at 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
"Credit Agreement" means the Loan and Security Agreement, dated as of
October 21, 2003, among Phibro Animal Health, each of its Subsidiaries parties
thereto, lenders parties thereto as such (together with their successors and
assigns, the "Lenders") and Xxxxx Fargo Foothill, Inc., as administrative agent
(in such capacity, together with its successors and assigns, the "Administrative
Agent"), or any other agreement providing for revolving credit loans, term
loans, receivables financing or letters of credit, as the same may be further
amended, modified, renewed, refunded, replaced or refinanced from time to time
(including extending the maturity of, increasing the amount of available
borrowings under, extending the purpose to include acquisition, working capital
and other facilities of, changing the conditions and basis of borrowing of,
combining the seniority of, changing the covenants and other provisions of, and
adding Subsidiaries of the Company as additional borrowers or guarantors, or
otherwise restructuring all or any portion of the Indebtedness under such
agreement or any successor or replacement and whether with the same or any other
agent, lender or group of lenders), including (i) any related notes, letters of
credit, guarantees, collateral documents, instruments and agreements executed in
connection therewith, and in each case as amended, modified, renewed, refunded,
replaced or refinanced from time to time, and (ii) any notes, guarantees,
collateral documents, instruments and agreements executed in connection with any
such amendment, modification, renewal, refunding, replacement or refinancing.
"Currency Agreement Obligations" means the obligations of any person under
a foreign exchange contract, currency swap agreement or other similar agreement
or arrangement to protect such person against fluctuations in currency values.
"Custodian" means any receiver, trustee, assignee, liquidator, sequestrator
or similar official under any Bankruptcy Law.
"Default" means any event that is, or after the giving of notice or passage
of time or both would be, an Event of Default.
"Depository" means The Depository Trust Company, its nominees and
successors.
"Disposition" means, with respect to any Person, any merger, consolidation
or other business combination involving such Person (whether or not such Person
is the Surviving Person) or the sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of such Person's assets.
"Disqualified Stock" means (i) any Preferred Stock of any Restricted
Subsidiary (other than Preferred Stock owned by the Company or any Wholly Owned
Restricted Subsidiary) and (ii) that portion of any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable), or 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 (other than upon a Change of
Control of the Company in circumstances where the Holders would have similar
rights), in whole or in part on or prior to the stated maturity of the Notes.
7
"Escrow Account" has the meaning provided therefor in the Escrow Agreement.
"Escrow Agent" is defined in the definition of the term Escrow Agreement.
"Escrow Agreement" means the Escrow and Security Agreement, dated as of the
Issue Date, among the Company, the Trustee and HSBC Bank USA, National
Association, as Escrow Agent (in such capacity, the "Escrow Agent"), as amended
or supplemented from time to time in accordance with its terms.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Exchange Offer" has the meaning provided in the Registration Rights
Agreement.
"Exchange Offer Registration Statement" has the meaning provided for the
term "Exchange Registration Statement" (as defined in the Registration Rights
Agreement).
"Fair Market Value" means, with respect to any asset or property, the sale
value that would be obtained in an arm's-length transaction between an informed
and willing seller under no compulsion to sell and an informed and willing buyer
under no compulsion to buy.
"Foreign Restricted Subsidiary" means a Restricted Subsidiary of the
Company that is a Foreign Subsidiary.
"Foreign Subsidiary" means a Subsidiary of the Company (1) which is
organized under the laws of any jurisdiction outside of the United States of
America, (2) which conducts the major portion of its business outside of the
United States of America and (3) all or substantially all of the property and
assets of which are located outside of the United States of America.
"GAAP" means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession in the United States of America, which are applicable
as of the Issue Date and consistently applied.
"GSK" means Glaxosmithkline Biologicals SA and/or Affiliates thereof.
"guaranty" means a guarantee (other than by endorsement of negotiable
instruments for collection or deposit in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
"Holder" means the Person in whose name a Note is registered on the
Registrar's books.
"Indebtedness" means, with respect to any Person, without duplication, and
whether or not contingent:
(i) all indebtedness of such Person for borrowed money or which is
evidenced by a note, bond, debenture or similar instrument;
8
(ii) all obligations of such Person to pay the deferred or unpaid
purchase price of property, which purchase price is due more than six
months after the date of placing such property in service or taking
delivery and title thereto;
(iii) all Capital Lease Obligations of such Person;
(iv) all obligations of such Person in respect of letters of credit or
bankers' acceptances issued or created for the account of such Person;
(v) to the extent not otherwise included in this definition, all net
obligations of such Person under Interest Rate Agreement Obligations or
Currency Agreement Obligations of such Person;
(vi) all liabilities of others of the kind described in the preceding
clause (i), (ii) or (iii) secured by any Lien on any property owned by such
Person; provided, however, if the obligations secured by a Lien (other than
a Permitted Lien not securing any liability that would itself constitute
Indebtedness) on any assets or property have not been assumed by such
Person in full or are not such Person's legal liability in full, the amount
of such Indebtedness for purposes of this definition shall be limited to
the lesser of the amount of Indebtedness secured by such Lien and the Fair
Market Value of the property subject to such Lien;
(vii) all Disqualified Stock issued by such Person and all Preferred
Stock issued by a Subsidiary of such Person (other than Preferred Stock of
a Restricted Subsidiary owned by the Company or a Wholly Owned Restricted
Subsidiary); and
(viii) to the extent not otherwise included, any guaranty by such
Person of any other Person's indebtedness or other obligations described in
clauses (i) through (vii) above. "Indebtedness" of the Company and the
Restricted Subsidiaries shall not include current trade payables incurred
in the ordinary course of business, and non-interest bearing installment
obligations and accrued liabilities incurred in the ordinary course of
business. The principal amount outstanding of any Indebtedness issued with
original issue discount is the accreted value of such Indebtedness.
Notwithstanding the foregoing, "Indebtedness" shall not include
Indebtedness arising from the honoring by a bank or other financial
institution of a check, draft or similar instrument inadvertently drawn
against insufficient funds in the ordinary course of business; provided
that such Indebtedness is extinguished within 3 Business Days of the
incurrence thereof. In addition, "Indebtedness" shall not include a
government grant and any guaranty of the Company or a Restricted Subsidiary
required by such grant which obligates the Company or a Restricted
Subsidiary to repay such grant at the discretion of such government or upon
the failure of the conditions of such grant specified therein to be
fulfilled, but which is forgiven solely by reason of the passage of time or
the fulfillment of such grant conditions (other than repayment); provided
that if the conditions for forgiveness of such government grant lapse for
whatever reason and the Company or a Restricted Subsidiary becomes
obligated to repay such grant, the grant shall be deemed Indebtedness which
is incurred at the time such obligation to repay is triggered.
"Indenture Documents" means, collectively, this Indenture, the Notes and
the Collateral Agreements.
"Initial Purchaser" means Xxxxxxxxx & Company, Inc.
9
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"interest" means, when used with respect to any Note, the amount of all
interest accruing on such Note, including any applicable defaulted interest
pursuant to Section 2.12 and any Additional Interest pursuant to the
Registration Rights Agreement.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Notes.
"Interest Rate Agreement 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, and (ii) other
agreements or arrangements designed to protect such Person against fluctuations
in interest rates.
"Investment" means, with respect to any Person, any direct or indirect loan
or other extension of credit (including, without limitation, any guaranty) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any other Person. "Investment" shall exclude (x) extensions of trade credit
by the Company and its Restricted Subsidiaries on commercially reasonable terms
in accordance with normal trade practices of the Company or such Restricted
Subsidiary, as the case may be, and (y) payments made by the Company and its
Restricted Subsidiaries in respect of liabilities of the type described in
clauses (ii)(b) and (e) of the definition of the term "Net Proceeds" in
connection with any Asset Sales by the Company or any of its Restricted
Subsidiaries (provided, however, that the aggregate amount of such payments
relating to any such Asset Sale shall at no time exceed the gross proceeds
actually received by the Company or such Restricted Subsidiary in connection
with such Asset Sale). For the purposes of Section 4.10, (i) "Investment" shall
include and be valued at the Fair Market Value of the net assets of any
Restricted Subsidiary (to the extent of the Company's equity interest in such
Restricted Subsidiary) at the time that such Restricted Subsidiary is designated
an Unrestricted Subsidiary and shall exclude the Fair Market Value of the net
assets of any Unrestricted Subsidiary at the time that such Unrestricted
Subsidiary is designated a Restricted Subsidiary and (ii) 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 its 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 in respect of such Investment; provided, however, that no
such payment of dividends or distributions or receipt of any such other amounts
shall reduce the amount of any Investment if such payment of dividends or
distributions or receipt of any such amounts would be included in Consolidated
Net Income. If the Company or any Restricted Subsidiary of the Company sells or
otherwise disposes of any Common Stock of any direct or indirect Restricted
Subsidiary of the Company such that, after giving effect to any such sale or
disposition, the Company no longer owns, directly or indirectly, greater than
50% of the outstanding Common Stock of such Restricted Subsidiary, the Company
and/or such Restricted Subsidiary shall be deemed to have made an Investment on
the date of any such sale or disposition equal to the Fair Market Value of the
Common Stock of such Restricted Subsidiary not sold or disposed of.
"Issue Date" means February 10, 2005, the date of the original issuance of
the Notes.
"Lenders" has the meaning set forth in the definition of the term "Credit
Agreement."
10
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or similar 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 give a security
interest in any asset).
"Maturity Date" means February 1, 2010.
"MRT" means Mineral Resource Technologies, Inc., a Delaware corporation.
"Net Proceeds" means, with respect to any Asset Sale by any Person, the
aggregate cash or Cash Equivalent proceeds received by such Person and/or its
Affiliates in respect of such Asset Sale, which amount is equal to the excess,
if any, of (i) the cash or Cash Equivalents received by such Person and/or its
Affiliates (including any cash payments received by way of deferred payment
pursuant to, or monetization of, a note or installment receivable or otherwise,
but only as and when received) in connection with such Asset Sale, over (ii) the
sum of (a) the amount of any Indebtedness that is secured by such asset and
which is required to be (and is in fact) repaid by such Person in connection
with such Asset Sale, plus (b) all fees, commissions and other expenses incurred
by such Person in connection with such Asset Sale, plus (c) provision for taxes,
including income taxes, directly attributable to the Asset Sale or to
prepayments or repayments of Indebtedness with the proceeds of such Asset Sale,
plus (d) if such Person is a Restricted Subsidiary, any dividends or
distributions payable to holders of minority interests in such Restricted
Subsidiary from the proceeds of such Asset Sale, plus (e) appropriate amounts to
be provided or established by the Company or any Restricted Subsidiary as a
reserve against any liabilities associated with such Asset Sale, including,
without limitation, pension and other post-employment benefit liabilities,
liabilities related to environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale; provided that upon
the release of any such reserves, such amounts shall constitute "Net Proceeds"
hereunder.
"Obligations" means any principal, premium, interest (including Additional
Interest), penalties, fees, indemnifications, reimbursement obligations, damages
and other liabilities and obligations payable under this Indenture, any Note or
any other Indenture Document.
"Offering Circular" means the Final Offering Circular dated February 7,
2005 relating to the issuance of the Initial Notes.
"Officer" means, with respect to any Person, the Chairman of the Board of
Directors, the Chief Executive Officer, the President, any Vice President, the
Chief Financial Officer, the Treasurer, the Controller or the Secretary of such
Person, or any other officer designated by the Board of Directors serving in a
similar capacity and, with respect to the Trustee or any agent of the Trustee, a
Trust Officer.
"Officers' Certificate" means a certificate signed on behalf of a Person by
two Officers of such Person, one of whom must be the principal executive
officer, the principal financial officer or the principal accounting officer of
such Person, that meets the requirements set forth in Sections 11.04 and 11.05
of this Indenture.
"Operating Company Refinancing Event" means the occurrence of one or more
Specified Refinancing Events since the Issue Date involving at least $20.0
million in aggregate principal amount of the 2007 Notes and/or the 2008 Notes.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee, or, where so specified, to the Issuer,
complying with the requirements of Sections 11.04 and 11.05, as they relate to
the giving of an Opinion of Counsel.
11
"Palladium Investors" means Palladium Equity Partners II, LP and certain of
its Affiliates.
"Permitted Holders" means (i) Xxxx Xxxxxxxx; (ii) each of his spouse,
siblings, ancestors, descendants (whether by blood, marriage or adoption, and
including stepchildren) and the spouses, siblings, ancestors and descendants
thereof (whether by blood, marriage or adoption, and including stepchildren) of
such natural persons, the beneficiaries, estates and legal representatives of
any of the foregoing, the trustee of any bona fide trust of which any of the
foregoing, individually or in the aggregate, are the majority in interest
beneficiaries or grantors, and any corporation, partnership, limited liability
company or other Person in which any of the foregoing, individually or in the
aggregate, own or control a majority in interest; and (iii) all Affiliates
controlled by the individual named in clause (i) above.
"Permitted Investments" means:
(i) Investments by the Company or any Restricted Subsidiary of the
Company in any Person that is or will become immediately after such
Investment a Restricted Subsidiary of the Company;
(ii) any investment in cash or Cash Equivalents;
(iii) Investments in the Company by any Restricted Subsidiary of the
Company;
(iv) Investments in accounts and notes receivable acquired in the
ordinary course of business;
(v) any notes, obligations or other securities received in connection
with an Asset Sale that complies with Section 4.16 or any other disposition
not constituting an Asset Sale;
(vi) Interest Rate Agreement Obligations and Currency Agreement
Obligations permitted pursuant to clause (d) of Section 4.12;
(vii) investments in or acquisitions of Capital Stock or similar
interests in Persons (other than Affiliates of the Company) received in the
bankruptcy or reorganization of or by such Person or any exchange of such
investment with the issuer thereof or taken in settlement of or other
resolution of claims or disputes; and
(viii) other Investments made after the Issue Date in an aggregate
amount at any one time outstanding not to exceed $2.5 million.
"Permitted Liens" means:
(i) Liens securing the Notes;
(ii) leases or subleases granted to others that do not materially
interfere with the ordinary course of business of the Company and its
Restricted Subsidiaries;
(iii) Liens to secure obligations arising from statutory, regulatory,
contractual or warranty requirements of the Company, including the
performance of statutory obligations, surety or appeal bonds or performance
bonds, or landlords', carriers', warehousemen's, mechanics', suppliers',
materialmen's or other like Liens, in any case incurred in the ordinary
course of business and rights to offset and set-off;
12
(iv) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded;
provided that any reserve or other appropriate provision as shall be
required in conformity with GAAP shall have been made therefor;
(v) judgment Liens not giving rise to an Event of Default so long as
such Lien is adequately bonded and any appropriate legal proceedings which
may have been duly initiated for the review of such judgment shall not have
been finally terminated or the period within which such proceedings may be
initiated shall not have expired; and
(vi) easements, rights-of-way, zoning restrictions, title
irregularities and other similar charges or encumbrances in respect of real
property not interfering in any material respect with the ordinary conduct
of the business of the Company.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Phibro Animal Health" means Phibro Animal Health Corporation, a New York
Corporation, which (i) as of the Issue Date, is a Restricted Subsidiary of the
Company and (ii) upon consummation of the transaction described under the
caption "Use of Proceeds" in the Offering Circular pursuant to which the Initial
Notes are offered and sold, a Wholly Owned Restricted Subsidiary of the Company.
"Phibro Belgium" means Phibro Animal Health SA (formerly Phibro Animal
Health (Belgium) SPRL).
"Physical Note" means a Note issued in exchange for interests in a Global
Note in the form of a permanent certificated Note in registered form in
substantially the form set forth in Exhibit A.
"Pledge Agreement" means the Pledge Agreement, dated as of the Issue Date,
made by the Company in favor of the Collateral Agent, as amended or supplemented
from time to time in accordance with its terms.
"PMC Sale Transactions" means the following transactions and payments,
including payments required pursuant to the documents evidencing such
transactions: (i) the transfer of ownership to the Palladium Investors of The
Prince Manufacturing Company ("PMC") which would be valued at approximately $21
million; (ii) the reduction of the preferred stock of the Palladium Investors to
$15.2 million (as of September 30, 2003); (iii) the termination of any
obligation of the Company or any Restricted Subsidiary of the Company in respect
of the $2.25 million annual management advisory fee (subject to reinstatement if
these transactions are not consummated on or before December 31, 2003); (iv) a
separate cash payment to the Palladium Investors of $10 million from the recent
sale of MRT; (v) payments by PMC to the Company for central support services for
the three years ending June 30, 2006 of $1 million, $0.5 million and $0.2
million, respectively; (vi) supply arrangements between the Company and PMC with
respect to manganous oxide and red iron oxide; (vii) customary representations,
warranties and indemnities by the Company, and provisions for closing working
capital balance adjustments, settlement of intercompany accounts owed to PMC, a
closing fee payable to Palladium and the agreement of the Company to pay or
reimburse the Palladium Investors for their reasonable out-of-pocket expenses;
and (viii) the establishment by the Company of a $1 million escrow or other
credit support for two years to secure its net working capital and foregoing
indemnification obligations, and indemnification of the Palladium Investors,
payable after the maturity of the Notes, for a portion, at the rate of $0.65 for
every
13
dollar, of the amount they receive in respect of the disposition of PMC less
than $21 million, up to a maximum payment by the Company of $4 million.
"Preferred Stock" as applied to the Capital Stock of any Person, means
Capital Stock of any class or classes (however designated) which is preferred as
to the payment of dividends or distributions, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
Person, over Capital Stock of any other class of such Person.
"Private Placement Legend" means the legend initially set forth on the
Initial Notes in the form set forth in Exhibit A as the same may be revised from
time to time to comply with applicable laws and regulations.
"pro forma" means, with respect to any calculation made or required to be
made pursuant to the terms of this Indenture, a calculation in accordance with
Article 11 of Regulation S-X under the Securities Act.
"Purchase Money Obligation" means any Indebtedness (as amended, modified,
renewed, refunded, replaced or refinanced) secured by a Lien on assets related
to the business of the Company or the Restricted Subsidiaries, and any additions
and accessions thereto, which are purchased, constructed or improved by the
Company or any Restricted Subsidiary at any time after the Issue Date; provided,
however, that (i) any security agreement or conditional sales or other title
retention contract pursuant to which the Lien on such assets is created
(collectively, a "Security Agreement") shall be entered into within 90 days
after the purchase or substantial completion of the construction or improvement
of such assets and shall at all times be confined solely to the assets so
purchased, constructed or improved, any additions and accessions thereto and any
proceeds therefrom, (ii) at no time shall the aggregate principal amount of the
outstanding Indebtedness secured thereby be increased, except in connection with
the purchase of additions and accessions thereto and except in respect of fees
and other obligations in respect of such Indebtedness and (iii) (A) the
aggregate outstanding principal amount of Indebtedness secured thereby
(determined on a per asset basis in the case of any additions and accessions)
shall not at the time such Security Agreement is entered into exceed 100% of the
purchase price or cost of construction or improvement to the Company or any
Restricted Subsidiary of the assets subject thereto or (B) the Indebtedness
secured thereby shall be with recourse solely to the assets so purchased,
constructed or improved, any additions and accessions thereto and any proceeds
therefrom.
"Qualified Institutional Buyer" or "QIB" shall have the meaning specified
in Rule 144A.
"Record Date" means the Record Dates specified in the Notes.
"Redemption Date" means, when used with respect to any Note to be redeemed,
the date fixed for such redemption pursuant to this Indenture and the Notes.
"Redemption Price" means, when used with respect to any Note to be
redeemed, the price fixed for such redemption, including principal and premium,
if any, pursuant to this Indenture and the Notes.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of the Issue Date between the Issuer and the Initial Purchaser.
"Regulation S" means Regulation S under the Securities Act.
"Related Business" means any business that is reasonably related to or
complementary to the businesses conducted by the Company, or the Restricted
Subsidiaries, on the Issue Date.
14
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payment" means, with respect to any Person (i) any dividend or
other distribution declared or paid on any Capital Stock of such Person (other
than (A) dividends or distributions payable solely in Capital Stock (other than
Disqualified Stock) of such Person, (B) dividends or distributions payable to
such Person or any Restricted Subsidiary of such Person and (C) dividends or
distributions payable to the Company); (ii) any payment to purchase, redeem or
otherwise acquire or retire for value any Capital Stock of such Person, other
than Capital Stock held by the Company or its Restricted Subsidiaries; (iii) any
payment to purchase, redeem, defease or otherwise acquire or retire for value,
prior to any scheduled maturity, repayment or sinking fund payment, any
Subordinated Indebtedness other than a purchase, redemption, defeasance or other
acquisition or retirement for value that is paid for with the proceeds of
Refinancing Indebtedness that is permitted under clause (b)(4) of Section 4.12;
or (iv) any Restricted Investment. A Permitted Investment is not a Restricted
Payment.
"Restricted Security" has the meaning assigned to such term in
Rule144(a)(3) under the Securities Act; provided, however, that the Trustee
shall be entitled to request and conclusively rely on an Opinion of Counsel with
respect to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" means each direct or indirect Subsidiary of the
Company other than an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
"Secured Parties" means the Collateral Agent, the Trustee and the Holders.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Security Agreement" means the Security Agreement, dated as of the Issue
Date, made by the Company in favor of the Collateral Agent, as amended or
supplemented from time to time in accordance with its terms.
"Security Interests" means the Liens on the Collateral created by this
Indenture and the Collateral Agreements in favor of the Collateral Agent for the
benefit of the Secured Parties.
"Series C Preferred Stock" means the Series C Redeemable Participating
Preferred Stock of Phibro Animal Health.
"Shareholders Agreements" means (i) the Shareholders Agreement dated
December 29, 1987 by and between Xxxxxx X. Xxxxxxx and Phibro Animal Health;
(ii) the Shareholders Agreement dated February 21, 1995 among Phibro-Tech, Inc.,
I. Xxxxx Xxxxx, Xxxxxx X. Xxxxxxxxx and Xxxxx X. Xxxxxxxx; (iii) the Severance
Agreement between Phibro-Tech, Inc. and Xxxxx X. Xxxxxxxx, dated February 21,
1995 and (iv) the Stockholders Agreement, dated as of November 30, 2000, among,
inter alia, Phibro Animal Health, Xxxx X. Xxxxxxxx and the Palladium Investors;
each as amended and in effect on the Issue Date, and as thereafter amended,
except for any amendment subsequent to the Issue Date which causes the terms of
such agreement to be less favorable to the Company or Phibro-Tech, as the case
may be.
"Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X promulgated
pursuant to the Securities Act, as such Regulation S-X is in effect on the Issue
Date.
15
"Specified Refinancing Event" means:
(i) any redemption, repayment, retirement or defeasance of;
(ii) any acquisition or purchase by the Company, any of its
Subsidiaries or any of their respective Affiliates of;
(iii) any extension or waiver (or exchange that results in the
extension) of any payment date in respect of interest on, or principal in
respect of; or
(iv) any other modification to the 2007 Notes, the 2008 Notes, the
2007 Indenture and/or the 2008 Indenture that results in (A) the extension
or waiver of any payment date in respect of interest on, or principal in
respect of, or (B) the redemption, repayment, retirement or defeasance of,
in each case, any 2007 Notes or any 2008 Notes.
"Subordinated Indebtedness" means Indebtedness of the Company that is
subordinated in right of payment to the Notes.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding voting power of the Voting Stock of which is owned or controlled,
directly or indirectly, by such Person or by one or more other Subsidiaries of
such Person, or by such Person and one or more other Subsidiaries thereof, or
(ii) any limited partnership of which such Person or any Subsidiary of such
Person is a general partner, or (iii) any other Person (other than a corporation
or limited partnership) in which such Person or one or more other Subsidiaries
of such Person, or such Person and one or more other Subsidiaries thereof,
directly or indirectly, has more than 50% of the outstanding partnership or
similar interests or has the power, by contract or otherwise, to direct or cause
the direction of the policies, management and affairs thereof.
"Subsidiary Permitted Lien" means:
(i) Liens securing Indebtedness under the Credit Agreement to the
extent such Indebtedness is permitted under clause (d)(i), (viii), (ix) or
(xii) of Section 4.12;
(ii) Liens securing the 2007 Notes and guarantees thereof; and
(iii) Liens securing Indebtedness of Foreign Restricted Subsidiaries
to the extent such Indebtedness is permitted under clause (d)(x) or (xii)
of Section 4.12.
"Surviving Person" means, with respect to any Person involved in or that
makes any Disposition, the Person formed by or surviving such Disposition or the
Person to which such Disposition is made.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx.
77aaa-77bbbb), as amended, as in effect on the date of this Indenture, except as
otherwise provided in Section 9.03.
"Transactions" means, collectively, the PMC Sale Transactions and the
Belgium Plant Sale and Virginiamycin Production Transactions.
"Trustee" means HSBC Bank USA, National Association, as trustee, and any
successor thereto in accordance with the terms of this Indenture.
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"Trust Officer" means any officer or assistant officer of the Trustee
assigned by the Trustee to administer this Indenture, or in the case of a
successor trustee, an officer assigned to the department, division or group
performing the corporation trust work of such successor and assigned to
administer this Indenture.
"United States Dollars," "Dollar," "dollar" and the symbol "$" means lawful
money of the United States of America.
"Unrestricted Subsidiary" means any Subsidiary of the Company designated as
such pursuant to and in compliance with Section 4.14 and not redesignated a
Restricted Subsidiary in compliance with such Section.
"U.S. Government Obligations" means direct obligations of, and obligations
guaranteed by, the United States of America for the payment of which the full
faith and credit of the United States of America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Voting Stock" of a Person means Capital Stock of such Person of the class
or classes pursuant to which the holders thereof have the general voting power
under ordinary circumstances to elect at least a majority of the board of
directors, managers or trustees of such Person (irrespective of whether or not
at the time stock of any other class or classes shall have or might have voting
power by reason of the happening of any contingency).
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required scheduled payment
of principal, including payment at final maturity, in respect thereof, with (b)
the number of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment, by (ii) the then outstanding
aggregate principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" means any Restricted Subsidiary with
respect to which all of the outstanding voting securities (other than directors'
qualifying shares or nominee shares held by a third party to comply with local
law) of which are owned, directly or indirectly, by the Company or a Surviving
Person of any Disposition involving the Company, as the case may be.
SECTION 1.02. Other Definitions.
Term Defined in Section
---- ------------------
"Additional Notes" 2.02
"Agent Members" 2.16
"Asset Sale Offer" 4.16(c)
"Asset Sale Offer Purchase Date" 4.16(d)
"Asset Sale Offer Trigger Date" 4.16(c)
"Authenticating Agent" 2.02
"Change of Control Offer" 4.15(b)
"Change of Control Purchase Date" 4.15(b)
"Collateral Agent" Preamble
"Company" Preamble
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Term Defined in Section
---- ------------------
"Company Refinancing Indebtedness" 4.12(b)(4)
"covenant defeasance" 8.02(b)
"Default Interest Payment Date" 2.12
"defeasance" 8.02(a)
"Designation" 4.14(a)
"Designation Amount" 4.14(a)(iii)
"Escrow Redemption" 3.03(b)
"Events of Default" 6.01
"Excess Proceeds" 4.16(b)
"Exchange Notes" Preamble
"Existing Indebtedness" 4.12(d)(ii)
"Global Notes" 2.01
"IAI Global Note" 2.01
"incur" 4.12(a)
"independent" 10.03(c)
"Initial Notes" Preamble
"Issuer" Preamble
"Legal Holiday" 11.07
"Mandatory Redemption Date" 3.03(a)
"Notes" Preamble
"Paying Agent" 2.03
"Permitted Indebtedness" 4.12(d)
"Permitted Payments" 4.10(b)
"PIK Notes" Preamble
"Private Placement Legend" 2.15
"QIB Global Note" 2.01
"Redesignation" 4.14(b)
"refinancing" 4.12(b)(4)
"Refinancing Indebtedness" 4.12(d)(v)
"Registrar" 2.03
"Regulation S Global Note" 2.01
"Released Interests" 10.04(a)
"Required Filing Dates" 4.08
"Trustee" Preamble
"Valuation Date" 10.04(b)
SECTION 1.03. TIA. Whenever this Indenture refers to a provision of the
TIA, such provision is incorporated by reference in, and made a part of, this
Indenture. The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
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"obligor" on the indenture securities means the Company or any other
obligor on the Notes.
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 1.04. Rules of Construction. Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to it
in accordance with GAAP of any date of determination;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular;
(5) "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;
(6) when the words "includes" or "including" are used herein, they shall be
deemed to be followed by the words "without limitation"; and
(7) any reference to a statute, law or regulation means that statute, law
or regulation as amended and in effect from time to time and includes any
successor statute, law or regulation; provided, however, that any reference to
the Bankruptcy Law shall mean the Bankruptcy Law as applicable to the relevant
case.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating. The Initial Notes and the Trustee's
certificate of authentication relating thereto shall be substantially in the
form of Exhibit A hereto. The Exchange Notes and the Trustee's certificate of
authentication relating thereto shall be substantially in the form of Exhibit B
hereto. The Notes may have notations, legends or endorsements required by law,
stock exchange rule or depository rule or usage. The Issuer and the Trustee
shall approve the form of the Notes and any notation, legend or endorsement on
them. Each Note shall be dated the date of its issuance and shall show the date
of its authentication.
The terms and provisions contained in the Notes annexed hereto as Exhibits
A and B shall constitute, and are hereby expressly made, a part of this
Indenture and, to the extent applicable, the Issuer and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Notes offered and sold (i) in reliance on Rule 144A, (ii) to Institutional
Accredited Investors or (iii) in reliance on Regulation S, shall be issued
initially in the form of one or more permanent global Notes in registered form,
substantially in the form set forth in Exhibit A (the "Global Notes"), deposited
with the Trustee, as custodian for the Depository, duly executed by the Issuer
and authenticated by the
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Trustee as hereinafter provided, and shall bear the legend set forth in Exhibit
A. One or more separate Global Notes shall be issued to represent Notes held by
(i) Qualified Institutional Buyers (a "QIB Global Note"), (ii) Institutional
Accredited Investors (an "IAI Global Note"), and (iii) Persons acquiring Notes
in reliance on Regulation S (a "Regulation S Global Note"). The aggregate
principal amount of any Global Note may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depository, as hereinafter provided.
All Notes offered and sold in reliance on Regulation S shall remain in the
form of Global Notes until the consummation of the Exchange Offer pursuant to
the Registration Rights Agreement; provided, however, that all of the time
periods specified in the Registration Rights Agreement to be complied with by
the Issuer have been so complied with.
SECTION 2.02. Execution and Authentication; Aggregate Principal Amount. Two
Officers, or an Officer and an Assistant Secretary of the Issuer, shall sign, or
one Officer shall sign and one Officer or an Assistant Secretary (each of whom
shall, in each case, have been duly authorized by all requisite corporate
actions) shall attest to, the Notes for the Issuer by manual or facsimile
signature.
If an Officer or Assistant Secretary whose signature is on a Note was an
Officer or Assistant Secretary at the time of such execution but no longer holds
that office or position at the time the Trustee authenticates the Note, the Note
shall nevertheless be valid.
A Note shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee shall authenticate (i) $29,000,000 principal amount of Initial
Notes, (ii) PIK Notes, from time to time after the Issue Date but prior to the
Maturity Date for issue only in lieu of the payment of interest in cash of
interest payable with respect to the Notes (including previously issued PIK
Notes) prior to the Maturity Date in an aggregate principal amount equal to the
amount of such interest (rounded to the nearest whole cent), (iii) Exchange
Notes, from time to time after the Issue Date for issue only in exchange for a
like principal amount of Initial Notes or PIK Notes, and (iv) subject to
compliance with Section 4.12, additional Notes (together with PIK Notes,
"Additional Notes") for original issue after the Issue Date in an unlimited
amount in each case upon written orders of the Issuer in the form of an
Officers' Certificate. Each such written order shall specify the amount of Notes
to be authenticated and the date on which the Notes are to be authenticated,
whether the Notes are to be Initial Notes, Exchange Notes or Additional Notes
and whether the Notes are to be issued as Physical Notes or Global Notes or such
other information as the Trustee may reasonably request.
In the event that the Issuer shall issue and the Trustee shall authenticate
any Additional Notes, the Issuer shall use its reasonable efforts to obtain the
same "CUSIP" number for such Notes as is printed on the Notes outstanding at
such time; provided, however, that if any series of Notes issued under this
Indenture subsequent to the Issue Date is determined, pursuant to an Opinion of
Counsel of the Issuer in a form reasonably satisfactory to the Trustee, to be a
different class of security than the Notes outstanding at such time for federal
income tax purposes, the Issuer may obtain a "CUSIP" number for such Notes that
is different than the "CUSIP" number printed on the Notes then outstanding.
Notwithstanding the foregoing, all Notes issued under this Indenture shall vote
and consent together on all matters as one class and no series of Notes will
have the right to vote or consent as a separate class on any matter.
The Trustee may appoint an authenticating agent (the "Authenticating
Agent") reasonably acceptable to the Issuer to authenticate Notes. Unless
otherwise provided in the appointment, an Authenticating Agent may authenticate
Notes whenever the Trustee may do so. Each reference in this
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Indenture to authentication by the Trustee includes authentication by such
Authenticating Agent. An Authenticating Agent has the same rights as an Agent to
deal with the Issuer or with any Affiliate of the Issuer.
The Notes shall be issuable in fully registered form only, without coupons;
provided, that the Notes (other than PIK Notes or Exchange Notes issued in
exchange for PIK Notes) shall be issued in denominations of $1,000 or any
integral multiple thereof.
The Trustee is authorized to enter into a letter of representation with the
Depository in the form provided to the Trustee by the Issuer and to act in
accordance with such letter.
SECTION 2.03. Registrar and Paying Agent. The Issuer shall maintain (or
appoint any Person (that satisfies the requirements of being the "Trustee"
hereunder as set forth in Section 7.10) to so maintain on its behalf) an office
or agency (which shall be located in the Borough of Manhattan in the City of New
York, State of New York) where (a) Notes may be presented or surrendered for
registration of transfer or for exchange ("Registrar"), (b) Notes may be
presented or surrendered for payment ("Paying Agent") and (c) notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Registrar shall keep a register of the Notes and of their transfer
and exchange. The Issuer may have one or more Co-Registrars and one or more
additional Paying Agents reasonably acceptable to the Trustee. The term "Paying
Agent" or "Registrar" includes any additional Paying Agent or Registrar, as the
case may be. The Issuer and any of its Subsidiaries may act as the Paying Agent
or Registrar.
The Issuer shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which agreement shall incorporate the provisions
of the TIA and implement the provisions of this Indenture that relate to such
Agent. The Issuer shall notify the Trustee of the name and address of any such
Agent. If the Issuer shall fail to maintain a Registrar or Paying Agent the
Trustee shall act as such.
The Issuer initially appoints the Trustee as Registrar, Paying Agent, agent
for service of demands and notices in connection with the Notes and agent to so
maintain the office or agency described under the first paragraph of this
Section 2.03, until such time as the Trustee has resigned or a successor has
been appointed. Any of the Registrar, the Paying Agent or any other agent may
resign upon 30 days' notice to the Issuer. The Issuer may change any Paying
Agent and Registrar without notice to the Holders.
SECTION 2.04. Paying Agent to Hold Assets in Trust. The Issuer shall
require each Paying Agent other than the Trustee to agree in writing that such
Paying Agent shall hold in trust for the benefit of the Holders or the Trustee
all assets held by the Paying Agent for the payment of principal of, premium, if
any, or interest on, the Notes (whether such assets have been distributed to it
by the Issuer or any other obligor on the Notes), and the Issuer and the Paying
Agent shall notify the Trustee of any Default by the Issuer (or any other
obligor on the Notes) in making any such payment. The Issuer 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 Issuer to the Paying Agent, the
Paying Agent shall have no further liability for such assets. If the Issuer or a
Subsidiary acts as Paying Agent, it shall segregate the money held by it as
Paying Agent and hold it as a separate trust fund.
SECTION 2.05. Holder 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 the Holders and shall
21
otherwise comply with TIA ss. 312(a). If the Trustee is not the Registrar, the
Issuer shall furnish or cause the Registrar to furnish to the Trustee three (3)
Business Days (or such shorter period as the Trustee may expressly agree to)
before each 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 the Holders, which list may be
conclusively relied upon by the Trustee, and the Issuer shall otherwise comply
with TIA ss. 312(a).
SECTION 2.06. Transfer and Exchange. Subject to Sections 2.16 and 2.17,
when Notes are presented to the Registrar or a Co-Registrar with a request to
register a transfer or to exchange such Notes for an equal principal amount of
Notes or other authorized denominations, the Registrar or Co-Registrar shall
register the transfer or make the exchange as requested if its requirements for
such transaction are met; provided, however, that the Notes presented or
surrendered for registration of transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Registrar or Co-Registrar, duly executed by the Holder thereof
or his attorney duly authorized in writing. To permit registration of transfers
and exchanges, the Issuer shall execute and the Trustee shall authenticate Notes
at the Registrar's or Co-Registrar's request. No service charge shall be made
for any registration of transfer or exchange, but the Issuer may require payment
of a sum sufficient to cover any transfer tax, fee or similar governmental
charge payable in connection therewith (other than any such transfer taxes or
similar governmental charge payable upon exchanges or transfers pursuant to
Section 2.10, 3.07, 4.15, 4.16 or 9.05, in which event the Issuer shall be
responsible for the payment of such taxes).
The Registrar or Co-Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the opening
of business on the day which is 15 days before the mailing of a notice of
redemption of Notes and ending at the close of business on the day of such
mailing and (ii) selected for redemption in whole or in part pursuant to Article
Three, except the unredeemed portion of any Note being redeemed in part.
Any Holder of a beneficial interest in a Global Note shall, by acceptance
of such Global Note, agree that transfers of beneficial interests in such Global
Note may be effected only through a book entry system maintained by the Holder
of such Global Note (or its agent), and that ownership of a beneficial interest
in the Note shall be required to be reflected in a book entry system.
SECTION 2.07. Replacement Notes. If a mutilated Note is surrendered to the
Trustee or if the Holder of a Note claims that the Note has been lost, destroyed
or wrongfully taken, the Issuer shall issue and the Trustee shall authenticate a
replacement Note if the Trustee's requirements are met. If required by the
Trustee or the Issuer, such Holder must provide an indemnity bond or other
indemnity of reasonable tenor, sufficient in the reasonable judgment of the
Issuer and the Trustee, to protect the Issuer, the Trustee or any Agent from any
loss which any of them may suffer if a Note is replaced. Every replacement Note
shall constitute an obligation of the Issuer.
SECTION 2.08. Outstanding Notes. Notes outstanding at any time are all the
Notes that have been authenticated by the Trustee except those canceled by it,
those delivered to it for cancellation and those described in this Section as
not outstanding. Subject to the provisions of Section 2.09, a Note does not
cease to be outstanding because the Issuer or any of its Affiliates holds the
Note.
If a Note is replaced pursuant to Section 2.07 (other than a mutilated Note
surrendered for replacement), it ceases to be outstanding unless the Trustee
receives proof satisfactory to it that the replaced Note is held by a bona fide
purchaser. A mutilated Note ceases to be outstanding upon surrender of such Note
and replacement thereof pursuant to Section 2.07.
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If on a Redemption Date or the Maturity Date the Paying Agent holds U.S.
Legal Tender sufficient to pay all of the principal, premium, if any, and
interest due on the Notes payable on that date and is not prohibited from paying
such money to the Holders thereof pursuant to the terms of this Indenture, then
on and after that date such Notes shall be deemed not to be outstanding and
interest on them shall cease to accrue.
SECTION 2.09. Treasury Notes. In determining whether the Holders of the
required principal amount of Notes have concurred in any direction, waiver,
consent or notice, Notes owned by the Issuer or an Affiliate of the Issuer shall
be considered as though they are not outstanding, except that for the purposes
of determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes which a Trust Officer of the Trustee
actually knows are so owned shall be so considered. The Issuer shall notify the
Trustee, in writing, when either it or, to its knowledge, any of its Affiliates
repurchases or otherwise acquires Notes, of the aggregate principal amount of
such Notes so repurchased or otherwise acquired and such other information as
the Trustee may reasonably request and the Trustee shall be entitled to rely
thereon.
SECTION 2.10. Temporary Notes. Until definitive Notes are ready for
delivery, the Issuer may prepare and the Trustee shall authenticate temporary
Notes upon receipt of a written order of the Issuer in the form of an Officers'
Certificate. The Officers' Certificate shall specify the amount of temporary
Notes to be authenticated and the date on which the temporary Notes are to be
authenticated. Temporary Notes shall be substantially in the form of definitive
Notes but may have variations that the Issuer considers appropriate for
temporary Notes and so indicate in the Officers' Certificate. Without
unreasonable delay, the Issuer shall prepare, and the Trustee shall
authenticate, upon receipt of a written order of the Issuer pursuant to Section
2.02, definitive Notes in exchange for temporary Notes.
SECTION 2.11. Cancellation. The Issuer at any time may deliver Notes to the
Trustee for cancellation. The Registrar and the Paying Agent shall forward to
the Trustee any Notes 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 and, at the written direction of the Issuer, shall
dispose, in its customary manner, of all Notes surrendered for transfer,
exchange, payment or cancellation. Subject to Section 2.07, the Issuer may not
issue new Notes to replace Notes that it has paid for or delivered to the
Trustee for cancellation. If the Issuer shall acquire any of the Notes, such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Notes unless and until the same are surrendered
to the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest. The Issuer will pay interest on overdue
principal from time to time on demand at 1% per annum in excess of the rate of
interest then borne by the Notes. The Issuer shall, to the extent lawful, pay
interest on overdue installments of interest (without regard to any applicable
grace periods) from time to time on demand at 1% per annum in excess of the rate
of interest then borne by the Notes. Interest will be computed on the basis of a
360-day year comprised of twelve 30-day months, and, in the case of a partial
month, the actual number of days elapsed.
If the Issuer defaults in a payment of interest on the Notes, it shall pay
the defaulted interest, plus (to the extent lawful) any interest payable on the
defaulted interest, to the Persons who are (i) Holders on a subsequent special
record date, if it so elects, which special record date shall be the fifteenth
day next preceding the date fixed by the Issuer for the payment of defaulted
interest or the next succeeding Business Day if such date is not a Business Day,
or (ii) if the Issuer does not elect a special record date, Holders on the next
Record Date, which payment shall be made on the next regular Interest Payment
Date. The Issuer shall notify the Trustee in writing of the amount of defaulted
interest proposed to be paid on each Note and the date of the proposed payment
(a "Default Interest Payment Date"), and at the same time the Issuer shall
deposit with the Trustee an amount of money equal to the aggregate amount
23
proposed to be paid in respect of such defaulted interest or shall make
arrangements satisfactory to the Trustee for such deposit on or prior to the
date of the proposed payment, such money when deposited to be held in trust for
the benefit of the Persons entitled to such defaulted interest as provided in
this Section; provided, however, that in no event shall the Issuer deposit
monies proposed to be paid in respect of defaulted interest later than 10:30
a.m. New York City time on the proposed Default Interest Payment Date. At least
15 days before the subsequent special record date, the Issuer shall mail (or
cause to be mailed) to each Holder, as of a recent date selected by the Issuer,
with a copy to the Trustee, a notice that states the subsequent special record
date, the payment date and the amount of defaulted interest, and interest
payable on such defaulted interest, if any, to be paid. Notwithstanding the
foregoing, any interest which is paid prior to the expiration of the 30-day
period set forth in Section 6.01(a) shall be paid to Holders as of the regular
record date for the Interest Payment Date for which interest has not been paid.
Notwithstanding the foregoing, the Issuer may make payment of any defaulted
interest in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Notes may be listed, and upon such notice
as may be required by such exchange.
SECTION 2.13. CUSIP Number. The Issuer in issuing the Notes shall use
"CUSIP" numbers. The Trustee shall use the CUSIP number in notices of redemption
or exchange as a convenience to Holders; provided, however, that no
representation is hereby deemed to be made by the Trustee as to the correctness
or accuracy of the CUSIP number printed in the notice or on the Notes, and that
reliance may be placed only on the other identification numbers printed on the
Notes. The Issuer shall promptly notify the Trustee of any change in the CUSIP
numbers.
SECTION 2.14. Deposit of Monies. Prior to 10:30 a.m. New York City time on
each Interest Payment Date, Maturity Date, Redemption Date, Change of Control
Purchase Date and Asset Sale Offer Purchase Date, the Issuer shall have
deposited with the Paying Agent in immediately available funds money sufficient
to make cash payments, if any, due on such Interest Payment Date, Maturity Date,
Redemption Date, Change of Control Purchase Date and Asset Sale Offer Purchase
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, Maturity Date,
Redemption Date, Change of Control Purchase Date and Asset Sale Offer Purchase
Date, as the case may be.
SECTION 2.15. Restrictive Legends. Each Global Note and Physical Note that
constitutes a Restricted Security shall bear the legend (the "Private Placement
Legend") as set forth in Exhibit A (as the same may be revised from time to time
to comply with applicable laws and regulations) on the face thereof until after
the second anniversary of the later of the Issue Date and the last date on which
the Issuer or any Affiliate of the Issuer was the owner of such Note (or any
predecessor security) (or such shorter period of time as permitted by Rule 144
under the Securities Act or any successor provision thereunder, unless otherwise
agreed by the Issuer and the Holder thereof) (or such longer period of time as
may be required under the Securities Act or applicable state securities laws in
the opinion of counsel for the Issuer).
Each Global Note shall also bear the legend as set forth in Exhibit A.
SECTION 2.16. Book-Entry Provisions for Global Notes. (a) The Global Notes
initially shall (i) be registered in the name of the Depository or the nominee
of such Depository, (ii) be delivered to the Trustee as custodian for such
Depository, and (iii) bear the legends as set forth in Exhibit A.
Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Note held on their
behalf by the Depository, or the Trustee as its custodian, or under the Global
Notes, and the Depository may be treated by the Issuer, the Trustee and any
Agent of the Issuer or the Trustee as the absolute owner of such Global Note for
all purposes
24
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Issuer, the Trustee or any Agent of the Issuer 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 governing the exercise of the rights of a
Holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers in whole, but
not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in a Global Note may be transferred or exchanged
for Physical Notes in accordance with the rules and procedures of the Depository
and the provisions of Section 2.17. In addition, Physical Notes shall be
transferred to all beneficial owners in exchange for their beneficial interests
in a Global Note if (i) the Depository notifies the Issuer that it is unwilling
or unable to continue as Depository for the Global Notes and a successor
depository is not appointed by the Issuer within 90 days of such notice or (ii)
an Event of Default has occurred and is continuing and the Registrar has
received a written request from the Depository to issue Physical Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Note to beneficial owners pursuant to paragraph
(b) of this Section 2.16, the Registrar shall (if one or more Physical Notes are
to be issued) reflect on its books and records the date and a decrease in the
principal amount of such Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred, and the Issuer
shall execute, and the Trustee shall authenticate and deliver, one or more
Physical Notes of like tenor and amount.
(d) In connection with the transfer of an entire Global Note to beneficial
owners pursuant to paragraph (b) of this Section 2.16, such Global Note shall be
deemed to be surrendered to the Trustee for cancellation, and the Issuer shall
execute, and the Trustee shall authenticate and deliver, to each beneficial
owner identified by the Depository in exchange for its beneficial interest in
the Global Note, an equal aggregate principal amount of Physical Notes of
authorized denominations.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b) or (c) of
this Section 2.16 shall, except as otherwise provided by paragraphs (d) and (f)
of Section 2.17, bear the Private Placement Legend.
(f) The Holder of a Global Note may 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, the Notes.
SECTION 2.17. Registration of Transfers and Exchanges. (a) Transfer and
Exchange of Physical Notes. When Physical Notes are presented to the Registrar
or Co-Registrar with a request:
(i) to register the transfer of the Physical Notes; or
(ii) to exchange such Physical Notes for an equal number of Physical
Notes of other authorized denominations,
the Registrar or Co-Registrar shall register the transfer or make the exchange
as requested if the requirements under this Indenture as set forth in this
Section 2.17 for such transactions are met; provided, however, that the Physical
Notes presented or surrendered for registration of transfer or exchange:
(i) shall be duly endorsed or accompanied by a written instrument of
transfer in form satisfactory to the Registrar or Co-Registrar, duly
executed by the Holder thereof or his attorney-in-fact duly authorized in
writing; and
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(ii) in the case of Physical Notes the offer and sale of which have
not been registered under the Securities Act, Physical Notes shall be
accompanied, in the sole discretion of the Issuer, by the following
additional information and documents, as applicable:
(1) if such Physical Note is being delivered to the Registrar or
Co-Registrar by a Holder for registration in the name of such
Holder, without transfer, a certification from such Holder to
that effect (substantially in the form of Exhibit E hereto); or
(2) if such Physical Note is being transferred to a Qualified
Institutional Buyer in accordance with Rule 144A, a certification
to that effect (substantially in the form of Exhibit E hereto);
or
(3) if such Physical Note is being transferred to an Institutional
Accredited Investor, delivery of a certification to that effect
(substantially in the form of Exhibit E hereto) and a Transferee
Certificate for Institutional Accredited Investors substantially
in the form of Exhibit C hereto and an Opinion of Counsel
reasonably satisfactory to the Issuer to the effect that such
transfer is in compliance with the Securities Act; or
(4) if such Physical Note is being transferred in reliance on
Regulation S, delivery of a certification to that effect
(substantially in the form of Exhibit E hereto) and a Transferee
Certificate for Regulation S Transfers substantially in the form
of Exhibit D hereto and an Opinion of Counsel reasonably
satisfactory to the Issuer to the effect that such transfer is in
compliance with the Securities Act; or
(5) if such Physical Note is being transferred in reliance on Rule
144 under the Securities Act, delivery of a certification to that
effect (substantially in the form of Exhibit E hereto) and an
Opinion of Counsel reasonably satisfactory to the Issuer to the
effect that such transfer is in compliance with the Securities
Act; or
(6) if such Physical Note is being transferred in reliance on another
exemption from the registration requirements of the Securities
Act, a certification to that effect (substantially in the form of
Exhibit E hereto) and an Opinion of Counsel reasonably acceptable
to the Issuer to the effect that such transfer is in compliance
with the Securities Act.
(b) Restrictions on Transfer of a Physical Note for a Beneficial Interest
in a Global Note. Unless otherwise agreed to by the Issuer, a Physical Note may
not be exchanged for a beneficial interest in a Global Note except upon
satisfaction of the requirements set forth below. Upon receipt by the Registrar
or Co-Registrar of a Physical Note, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Registrar or Co-Registrar,
together with:
(i) certification, substantially in the form of Exhibit E hereto, that
such Physical Note is being transferred (A) to a Qualified Institutional
Buyer, (B) to an Institutional Accredited Investor or (C) in reliance on
Regulation S and, in the case of (II), a Transferee Certificate for
Institutional Accredited Investors substantially in the form of Exhibit C
hereto and, in the case of (C), a Transferee Certificate for Regulation S
Transfers substantially in the form of Exhibit D hereto and in each case an
Opinion of Counsel reasonably satisfactory to the Issuer to the effect that
such transfer is in compliance with the Securities Act; and
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(ii) written instructions from the Issuer directing the Registrar or
Co-Registrar to make, or to direct the Depository to make, an endorsement
on the applicable Global Note to reflect an increase in the aggregate
amount of the Notes represented by the Global Note, then the Registrar or
Co-Registrar shall cancel such Physical Note and cause, or direct the
Depository to cause, in accordance with the standing instructions and
procedures existing between the Depository and the Registrar or
Co-Registrar, the principal amount of Notes represented by the applicable
Global Note to be increased accordingly. If no Global Note representing
Notes held by Qualified Institutional Buyers, Institutional Accredited
Investors or Persons acquiring Notes in reliance on Regulation S, as the
case may be, is then outstanding, the Issuer shall issue and the Trustee
shall, upon written instructions from the Issuer in accordance with Section
2.02, authenticate such Global Note in the appropriate principal amount.
(c) Transfer and Exchange of Global Notes. The transfer and exchange of
Global Notes or beneficial interests therein shall be effected through the
Depository in accordance with this Indenture (including the restrictions on
transfer set forth herein) and the procedures of the Depository therefor. Upon
receipt by the Registrar or Co-Registrar of written instructions, or such other
instruction as is customary for the Depository, from the Depository or its
nominee, requesting the registration of transfer of an interest in a QIB Global
Note, an IAI Global Note or a Regulation S Global Note, as the case may be, to
another type of Global Note, together with the applicable Global Notes (or, if
the applicable type of Global Note required to represent the interest as
requested to be transferred is not then outstanding, only the Global Note
representing the interest being transferred), the Registrar or Co-Registrar
shall cause, or direct the Depository to cause, in accordance with the standing
instructions and procedures existing between the Depository and the Registrar or
Co-Registrar, the principal amount of Notes represented by the applicable Global
Notes involved in such transfer or exchange to be adjusted accordingly to
reflect the applicable increase and decrease of the principal amount of Notes
represented by such types of Global Notes, giving effect to such transfer. If
the applicable type of Global Note required to represent the interest as
requested to be transferred is not outstanding at the time of such request, the
Issuer shall issue and the Trustee shall, upon written instructions from the
Issuer in accordance with Section 2.02, authenticate a new Global Note of such
type in principal amount equal to the principal amount of the interest requested
to be transferred. Any such transfer or exchange of Global Notes or beneficial
interests therein shall be effected through the Depository in accordance with
this Indenture (including the restrictions on transfer as contemplated herein)
and the procedure of the Depository therefor. Unless otherwise agreed to by the
Issuer, any request for the registration of the transfer of an interest in a QIB
Global Note, an IAI Global Note or a Regulation S Global Note to another type of
Global Note, must be accompanied by a certificate from the transferor,
substantially in the form of Exhibit E hereto, that the transferee is either (i)
a Qualified Institutional Buyer in accordance with Rule 144A, (ii) an
Institutional Accredited Investor, or (iii) relying on Regulation S, and in the
case of (ii), a Transferee Certificate for Institutional Accredited Investors
substantially in the form of Exhibit C hereto and, in the case of (iii), a
Transferee Certificate for Regulation S Transfers substantially in the form of
Exhibit D hereto and in each case an Opinion of Counsel reasonably satisfactory
to the Issuer to the effect that such transfer is in compliance with the
Securities Act.
(d) Transfer of a Beneficial Interest in a Global Note for a Physical Note.
(i) Any Person having a beneficial interest in a Global Note may upon
request exchange such beneficial interest for a Physical Note. Upon receipt
by the Registrar or Co-Registrar of written instructions, or such other
form of instructions as is customary for the Depository, from the
Depository or its nominee on behalf of any Person having a beneficial
interest in a Global Note and upon receipt by the Trustee of a written
order or such other form of instructions as is customary for the Depository
or the Person designated by the Depository as having such a beneficial
interest containing registration instructions and, in the case of any such
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transfer or exchange of a beneficial interest in Notes the offer and sale
of which have not been registered under the Securities Act, the following
additional information and documents:
(1) if such beneficial interest is being transferred to the Person
designated by the Depository as being the beneficial owner, a
certification from such Person to that effect (substantially in
the form of Exhibit E hereto); or
(2) if such beneficial interest is being transferred to a Qualified
Institutional Buyer in accordance with Rule l44A, a certification
to that effect (substantially in the form of Exhibit E hereto);
or
(3) if such beneficial interest is being transferred to an
Institutional Accredited Investor, delivery of a certification to
that effect (substantially in the form of Exhibit E hereto) and a
Certificate for Institutional Accredited Investors substantially
in the form of Exhibit C hereto and an Opinion of Counsel
reasonably satisfactory to the Issuer to the effect that such
transfer is in compliance with the Securities Act; or
(4) if such beneficial interest is being transferred in reliance on
Regulation S, delivery of a certification to that effect
(substantially in the form of Exhibit E hereto) and a Transferee
Certificate for Regulation S Transfers substantially in the form
of Exhibit D hereto and an Opinion of Counsel reasonably
satisfactory to the Issuer to the effect that such transfer is in
compliance with the Securities Act; or
(5) if such beneficial interest is being transferred in reliance on
Rule 144 under the Securities Act, delivery of a certification to
that effect (substantially in the form of Exhibit E hereto) and
an Opinion of Counsel reasonably satisfactory to the Issuer to
the effect that such transfer is in compliance with the
Securities Act; or
(6) if such beneficial interest is being transferred in reliance on
another exemption from the registration requirements of the
Securities Act, a certification to that effect (substantially in
the form of Exhibit E hereto) and an Opinion of Counsel
reasonably satisfactory to the Issuer to the effect that such
transfer is in compliance with the Securities Act,
then the Registrar or Co-Registrar will cause, in accordance with the
standing instructions and procedures existing between the Depository and
the Registrar or Co-Registrar, the aggregate principal amount of the
applicable Global Note to be reduced and, following such reduction, the
Issuer will execute and, upon receipt of an authentication order in the
form of an Officers' Certificate in accordance with Section 2.02, the
Trustee will authenticate and deliver to the transferee a Physical Note.
(ii) Notes issued in exchange for a beneficial interest in a Global
Note pursuant to this Section 2.17(d) shall be registered in such names and
in such authorized denominations as the Depository, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Registrar or Co-Registrar in writing. The Registrar or
Co-Registrar shall deliver such Physical Notes to the Persons in whose
names such Physical Notes are so registered.
(e) Restrictions on Transfer and Exchange of Global Notes. Notwithstanding
any other provisions of this Indenture, a Global Note may not be transferred as
a whole except by the Depository to
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a nominee of the Depository or by a nominee of the Depository to the Depository
or by any such nominee to a successor Depository or a nominee of such successor
Depository.
(f) Private Placement Legend. Upon the transfer, exchange or replacement of
Notes not bearing the Private Placement Legend, the Registrar or Co-Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar or Co-Registrar shall deliver only Notes that bear the Private
Placement Legend unless (i) the requested transfer is after the second
anniversary of the Issue Date (provided, however, that neither the Issuer nor
any Affiliate of the Issuer has held any beneficial interest in such Note, or
portion thereof, at any time prior to or on the second anniversary of the Issue
Date unless otherwise agreed by the Issuer) and (ii) there is delivered to the
Registrar or Co-Registrar a certificate and/or, if requested, an Opinion of
Counsel, each reasonably satisfactory to the Issuer and the Trustee to the
effect that neither such legend nor the related restrictions on transfer are
required in order to maintain compliance with the provisions of the Securities
Act.
(g) General. By its acceptance of any Note bearing the Private Placement
Legend, each Holder of such a Note acknowledges the restrictions on transfer of
such Note set forth in this Indenture and in the Private Placement Legend and
agrees that it will transfer such Note only as provided in this Indenture.
The Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.16 or this Section 2.17. The
Issuer shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time during the
Registrar's normal business hours upon the giving of reasonable written notice
to the Registrar.
(h) Transfers of Notes Held by Affiliates. Any certificate (i) evidencing a
Note that has been transferred to an Affiliate of the Issuer within two years
after the Issue Date, as evidenced by a notation on the Assignment Form for such
transfer or in the representation letter delivered in respect thereof or (ii)
evidencing a Note that has been acquired from an Affiliate (other than by an
Affiliate) in a transaction or a chain of transactions not involving any public
offering, shall, until two years after the last date on which the Issuer or any
Affiliate of the Issuer was an owner of such Note, in each case, bear the
Private Placement Legend, unless otherwise agreed by the Issuer (with written
notice thereof to the Trustee).
SECTION 2.18. Additional Interest Under Registration Rights Agreement.
Under certain circumstances, the Issuer shall be obligated to pay certain
Additional Interest to the Holders, all as set forth in Section 4 of the
Registration Rights Agreement. The terms thereof are hereby incorporated herein
by reference.
SECTION 2.19. Issuance of PIK Notes. (a) The Company shall be entitled to
issue PIK Notes under this Indenture, which PIK Notes shall have identical terms
as the Notes in respect of which such PIK Notes are being issued in lieu of the
payment of interest in cash on any Note (including a PIK Note); provided that
the aggregate principal amount thereof shall be equal to the amount of such
interest (rounded to the nearest whole cent).
(b) With respect to any PIK Notes, the Company shall deliver to the
Trustee:
(i) no later than the Record Date for the relevant Interest Payment
Date (which Interest Payment Date shall be prior to the Maturity Date), a
written notice setting forth the extent to which such interest payment will
be made in the form of a PIK Note; and
(ii) no later than one Business Day prior to the relevant interest
payment date, an order to authenticate and deliver such PIK Notes.
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(c) Any PIK Notes shall, after being executed and authenticated pursuant to
Section 2.02, be (i) delivered by the Trustee to the Holders as of the relevant
Record Date at such Holders' registered address if the Notes are then held in
the form of certificated Notes or (ii) deposited with or on behalf of the
Depository for the benefit of the beneficial owners of the Notes as of the
relevant Record Date if the Notes are held in global form.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee. If the Issuer elects to redeem Notes
pursuant to the terms of the Notes, it shall notify the Trustee and the Paying
Agent in writing of the Redemption Date and the principal amount of the Notes to
be redeemed.
The Issuer shall give each notice to the Trustee provided for in this
Section 3.01 at least 45 days before the Redemption Date (unless a shorter
notice period shall be satisfactory to the Trustee), together with an Officers'
Certificate stating that such redemption shall comply with the conditions
contained herein and in the Notes. Any such notice may be canceled at any time
prior to notice of such redemption being mailed to any Holder and shall thereby
be void and of no effect.
SECTION 3.02. Selection of Notes To Be Redeemed. If less than all of the
Notes are to be redeemed at any time, selection of the Notes to be redeemed will
be made by the Trustee in compliance with the requirements of the principal
national securities exchange, if any, on which the Notes are listed or, if the
Notes are not listed on a securities exchange, on a pro rata basis or by lot or
any other method as the Trustee shall deem fair and appropriate; provided, that
Notes redeemed in part shall only be redeemed in integral multiples of $1,000;
provided further, that any such redemption pursuant to the provisions relating
to a Public Equity Offering shall be made on a pro rata basis or on as nearly a
pro rata basis as practicable (subject to the procedures of The Depository Trust
Company or any other depositary), unless such method is otherwise prohibited.
SECTION 3.03. Redemptions.
(a) Mandatory Redemption due to Operating Company Refinancing Event. If an
Operating Company Refinancing Event shall occur, the Issuer will be required to
redeem all of the Notes on a date (the "Mandatory Redemption Date") that is not
later than the 60th day following the date of such occurrence at the redemption
price (expressed as a percentage of the aggregate principal amount of the Notes)
then applicable for optional redemptions on the Mandatory Redemption Date as set
forth under clause (d) below, plus accrued and unpaid interest to the Mandatory
Redemption Date; provided, that if the Mandatory Redemption Date is prior to
June 1, 2005, the then applicable redemption price shall be deemed to be 115.0%.
(b) Mandatory Redemption due to the Failure to Escrow Release Conditions.
In the event that the Trustee has not received prior to 10:00 a.m. New York City
time on March 1, 2005 an Officers' Certificate from the Company certifying that
(1) it has satisfied the conditions under either clause (a)(i) or (ii) of
Section 1.3 of the Escrow Agreement and (2) it has made a demand on the Escrow
Agent pursuant to clause (a) of Section 1.3 of the Escrow Agreement for the
release of the funds from the Escrow Account, the Trustee shall give written
notice to the Escrow Agent pursuant to clause (b) of Section 1.3 of the Escrow
Agreement that a special redemption of the Notes (an "Escrow Redemption") will
be made on March 1, 2005. The Trustee shall direct the Paying Agent to redeem
the Notes at 100% of their aggregate
30
principal amount plus accrued and unpaid interest to such date upon receipt of
proceeds from the Escrow Account pursuant to clause (b) of Section 1.3 of the
Escrow Agreement.
(c) Optional Redemption Prior to June 1, 2005. The Notes are not optionally
redeemable by the Issuer, in whole or in part, at any time prior to June 1,
2005.
(d) Optional Redemption on or after June 1, 2005. The Notes are redeemable
at the option of the Issuer, in whole or in part, at any time on or after June
1, 2005 at the redemption prices (expressed as percentages of the principal
amount of the Notes) set forth below plus in each case accrued and unpaid
interest to the date of redemption, if redeemed during the periods beginning on
the dates indicated below:
Period Percentage
------ ----------
June 1, 2005...................... 115.0%
February 1, 2007.................. 110.0%
February 1, 2008.................. 105.0%
February 1, 2009 and thereafter... 100.0%
SECTION 3.04. Notice of Redemption. Notices of any optional or mandatory
redemption shall be mailed by first class mail at least 30 but not more than 60
days before the Redemption Date to each Holder to be redeemed at such Holder's
registered address, with a copy to the Trustee and any Paying Agent; provided,
that notice of an Escrow Redemption need not be given in advance but instead
shall be provided no later than March 1, 2005. At the Issuer's request, the
Trustee shall give the notice of redemption in the Issuer's names and at the
Issuer's expense. The Issuer shall provide such notices of redemption to the
Trustee at least five days (or in the case of a notice of an Escrow Redemption,
one day) before the intended mailing date (unless a shorter period shall be
satisfactory to the Trustee).
Each notice of redemption shall identify (including the CUSIP number) the
Notes to be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued interest, if any, to be
paid;
(3) the name and address of the Paying Agent;
(4) the subparagraph of the Notes pursuant to which such redemption is
being made;
(5) that Notes called for redemption must be surrendered to the Paying
Agent to collect the Redemption Price plus accrued interest, if any;
(6) that, unless the Issuer defaults in making the redemption payment,
interest on Notes or applicable portions thereof called for redemption ceases to
accrue on and after the Redemption Date, and the only remaining right of the
Holders of such Notes is to receive payment of the Redemption Price plus accrued
interest as of the Redemption Date, if any, upon surrender to the Paying Agent
of the Notes redeemed;
(7) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed, and the Trustee shall authenticate and mail
to the Holder of the original Note a Note in principal amount equal to the
unredeemed portion of the original Note promptly after the original Note has
been canceled; and
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(8) if fewer than all the Notes are to be redeemed, the identification of
the particular Notes of such Holder (or portion thereof) to be redeemed, as well
as the aggregate principal amount of Notes to be redeemed and the aggregate
principal amount of Notes to be outstanding after such partial redemption.
The Issuer will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the purchase
of Notes.
SECTION 3.05. Effect of Notice of Redemption. Once notice of redemption is
mailed in accordance with Section 3.04, such notice of redemption shall be
irrevocable and Notes called for redemption become due and payable on the
Redemption Date and at the Redemption Price plus accrued interest as of such
date, if any. Upon surrender to the Trustee or Paying Agent, such Notes called
for redemption shall be paid at the Redemption Price plus accrued interest
thereon to the Redemption Date, but installments of interest, the maturity of
which is on or prior to the Redemption Date, shall be payable to Holders of
record at the close of business on the relevant record dates referred to in the
Notes. Interest shall accrue on or after the Redemption Date and shall be
payable only if the Issuer defaults in payment of the Redemption Price.
SECTION 3.06. Deposit of Redemption Price. On or before the Redemption Date
and in accordance with Section 2.14, the Issuer shall deposit with the Paying
Agent U.S. Legal Tender sufficient to pay the Redemption Price plus accrued
interest, if any, of all Notes to be redeemed on that date. The Paying Agent
shall promptly return to the Issuer any U.S. Legal Tender so deposited which is
not required for that purpose, except with respect to monies owed as obligations
to the Trustee pursuant to Article Seven.
Unless the Company fails to comply with the preceding paragraph and
defaults in the payment of such Redemption Price plus accrued interest, if any,
interest on the Notes to be redeemed will cease to accrue on and after the
applicable Redemption Date on Notes or portions thereof called for redemption,
whether or not such Notes are presented for payment.
SECTION 3.07. Notes Redeemed in Part. Upon surrender of a Note that is to
be redeemed in part, the Trustee shall authenticate for the Holder a new Note or
Notes equal in principal amount to the unredeemed portion of the Note
surrendered.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes. (a) The Issuer shall pay the principal of,
premium, if any, and interest on the Notes issued by the Issuer on the dates and
in the manner provided in such Notes and in this Indenture.
(b) An installment of principal of or interest on the Notes shall be
considered paid on the date it is due if the Trustee or Paying Agent (other than
the Issuer or any of its Affiliates) holds, prior to 10:30 a.m. New York City
time on that date, U.S. Legal Tender designated for and sufficient to pay the
installment in full and is not prohibited from paying such money to the Holders
pursuant to the terms of this Indenture or the Notes.
(c) The Issuer shall pay, to the extent such payments are lawful, interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and on overdue
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installments of interest (without regard to any applicable grace periods) from
time to time on demand at 1% per annum in excess of the rate borne by the Notes
issued by the Issuer. Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months.
(d) Notwithstanding anything to the contrary contained in this Indenture,
the Issuer may, to the extent it is required to do so by law, or shall cause the
Trustee to, deduct or withhold income or other similar taxes imposed by the
United States of America from principal or interest payments in respect of the
Notes issued by the Issuer that are made hereunder.
SECTION 4.02. Maintenance of Office or Agency. The Issuer shall maintain
(or appoint any Person (that satisfies the requirements of being the "Trustee"
hereunder as set forth in Section 7.10) to so maintain on its behalf) the office
or agency required under Section 2.03. The Issuer shall give prior written
notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Issuer 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.
SECTION 4.03. Corporate Existence. Except as otherwise permitted by Section
5.01, the Issuer shall do or cause to be done, at its own cost and expense, all
things necessary to preserve and keep in full force and effect its corporate
existence and the corporate existence of each of the Restricted Subsidiaries in
accordance with the respective organizational documents of each such Restricted
Subsidiary and the material rights (charter and statutory) and franchises of the
Issuer and each Restricted Subsidiary; provided, however, that the Issuer shall
not be required to preserve, with respect to itself, any material right or
franchise and, with respect to any Restricted Subsidiaries, any such existence,
material right or franchise, if the Board of Directors of the Issuer (or if such
existence is with respect to any Restricted Subsidiary which is not a
Significant Subsidiary, by the appropriate Officers of the Issuer) shall
determine in good faith that the preservation thereof is no longer desirable in
the conduct of the business of the Issuer and the Subsidiaries, taken as a
whole.
SECTION 4.04. Payment of Taxes and Other Claims. The Issuer shall pay or
discharge or cause to be paid or discharged, before penalties attach, (i) all
material taxes, assessments and governmental charges (including withholding
taxes and any penalties, interest and additions to taxes) levied or imposed upon
it or any of the Restricted Subsidiaries or properties of it or any of its
Restricted Subsidiaries and (ii) all material lawful claims for labor, materials
and supplies that, if unpaid, might by law become a Lien upon the property of
the Issuer or any of the Restricted Subsidiaries; provided, however, that the
Issuer shall not 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 negotiations or
proceedings properly instituted and conducted for which adequate reserves, to
the extent required under GAAP, have been taken.
SECTION 4.05. Maintenance of Properties and Insurance. (a) The Issuer
shall, and shall cause each of the Restricted Subsidiaries to, maintain all
material properties used in the conduct of its business in working order and
condition (subject to ordinary wear and tear) and make all necessary repairs,
renewals, replacements, additions, betterments and improvements thereto and
actively conduct and carry on its business; provided, however, that nothing in
this Section 4.05 shall prevent the Issuer or any of the Restricted Subsidiaries
from discontinuing the operation and maintenance of any of its properties, if
such discontinuance is (i) in the ordinary course of business pursuant to
customary business terms or (ii) in the good faith judgment of the respective
Boards of Directors or other governing body of the Issuer or Restricted
Subsidiary, as the case may be, desirable in the conduct of their respective
businesses and would not be reasonably likely to cause a material adverse effect
upon the business, operations, assets, condition (financial or otherwise) or
prospects of the Issuer and the Subsidiaries, taken as a whole.
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(b) The Issuer shall provide or cause to be provided, for itself and each
of the Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds that, in the good faith judgment of the
Issuer, are customary for companies of a similar size in the conduct of the
business of the Issuer and the Restricted Subsidiaries, with reputable insurers
or with the Government of the United States of America or any agency or
instrumentality thereof (if not through self-insurance).
SECTION 4.06. Compliance Certificate; Notice of Default. (a) The Issuer
shall deliver to the Trustee, within 90 days after the end of each of the
Issuer's fiscal years, an Officers' Certificate (provided, however, that one of
the signatories to each such Officers' Certificate shall be the Issuer's
principal executive officer, principal financial officer or principal accounting
officer), as to such Officers' knowledge, without independent investigation, of
the Issuer's compliance with all conditions and covenants under this Indenture
(without regard to any period of grace or requirement of notice provided
hereunder) and in the event any Default of the Issuer exists, such Officers'
Certificate shall specify the nature of such Default. Each such Officers'
Certificate shall also notify the Trustee should the Issuer elect to change the
manner in which it fixes its fiscal year-end.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the annual financial
statements delivered pursuant to Section 4.08 shall be accompanied by a written
report of the Issuer's independent certified public accountants (who shall be a
firm of established national reputation) stating whether, in connection with
their audit examination, any Default or Event of Default, as they relate to
accounting matters, has come to their attention specifying the nature and period
of existence thereof; provided, however, that, without any restriction as to the
scope of the audit examination, such independent certified public accountants
shall not be liable by reason of any failure to obtain knowledge of any such
Default or Event of Default that would not be disclosed in the course of an
audit examination conducted in accordance with generally accepted auditing
standards.
(c) (i) If any Default or Event of Default has occurred and is continuing
or (ii) if any Holder seeks to exercise any remedy hereunder with respect to a
claimed Default under this Indenture or the Notes, the Issuer shall deliver to
the Trustee, at its address set forth in Section 11.02, by registered or
certified mail or by facsimile transmission followed by hard copy by registered
or certified mail an Officers' Certificate specifying such event, notice or
other action promptly upon its becoming aware of such occurrence.
SECTION 4.07. Compliance with Laws. The Issuer shall comply, and shall
cause each of its Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all states
and municipalities thereof, and of any governmental department, commission,
board, regulatory authority, bureau, agency and instrumentality of the
foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except for such noncompliances as
would not singly or in the aggregate reasonably be expected to have a material
adverse effect on the financial condition or results of operations of the Issuer
and its Subsidiaries taken as a whole.
SECTION 4.08. Provision of Financial Statements and Information. Whether or
not the Issuer is then subject to Section 13(a) or 15(d) of the Exchange Act,
the Issuer will file with the Commission following the effectiveness of the
Exchange Offer Registration Statement, so long as any Notes are outstanding, the
annual reports, quarterly reports and other periodic reports which the Company
would have been required to file with the Commission pursuant to such Section
13(a) or 15(d) if the Company were so subject, and such documents shall be filed
with or furnished to the Commission on or prior to the respective dates (the
"Required Filing Dates") by which the Company would have been required to so
file or furnish such documents if the Company were so subject; provided the
Commission will accept such filings. The Company will also in any event (i)
within 15 days of each Required Filing Date following
34
the effectiveness of the Exchange Offer Registration Statement, file with the
Trustee, and supply the Trustee with copies for delivery to the Holders and
prospective purchasers of the Notes, the annual reports, quarterly reports and
other periodic reports which the Company would have been required to file with
the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act if the
Company were subject to such Sections and (ii) if the Commission will not accept
the filing of such documents promptly upon written request and payment of the
reasonable cost of duplication and delivery, supply copies of such documents to
any prospective Holder of the Notes. Prior to the effectiveness of the Exchange
Offer Registration Statement, the Company will provide upon request from Holders
or prospective Holders of Notes the information required by Rule 144A(d) (4)
under the Securities Act.
SECTION 4.09. Waiver of Stay, Extension or Usury Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it 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 that would prohibit
or forgive the Issuer from paying all or any portion of the principal of or
interest on the Notes as contemplated herein, wherever enacted, now or at any
time hereafter in force, or which may affect the covenants or the performance of
this Indenture; and (to the extent that it may lawfully do so) the Issuer hereby
expressly waives all benefits or advantages of any such law, and covenants that
it will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 4.10. Limitation on Restricted Payments. (a) The Company will not,
nor will it permit any Restricted Subsidiary to, directly or indirectly, make
any Restricted Payment ; provided, however, that Restricted Subsidiaries may
make Restricted Payments if, at the time of and immediately after giving effect
to the proposed Restricted Payment (with the value of any such Restricted
Payment, if other than cash, to be determined reasonably and in good faith by
the Board of Directors of the Company):
(i) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof;
(ii) Phibro Animal Health could incur at least $1.00 of additional
Indebtedness pursuant to clause (c) of Section 4.12 and
(iii) the aggregate amount of all Restricted Payments made by the
Restricted Subsidiaries after October 21, 2003 shall not exceed the sum of:
(1) an amount equal to 50% of Phibro Animal Health's aggregate
cumulative Consolidated Net Income accrued on a cumulative
basis during the period (treated as one accounting period)
beginning on November 1, 2003 and ending on the date of such
proposed Restricted Payment (or, if such aggregate
cumulative Consolidated Net Income for such period shall be
a deficit, minus 100% of such deficit); plus
(2) the aggregate amount of all net cash proceeds received since
the Issue Date by the Company from the issuance and sale
(other than to a Restricted Subsidiary) of, or equity
contribution with respect to, Capital Stock (other than
Disqualified Stock) and the principal amount of Indebtedness
of the Company or any Restricted Subsidiary issued or
incurred on or after the Issue Date that has been converted
into or exchanged for Capital Stock (other than Disqualified
Stock), in any such case and solely for purposes of avoiding
duplication, to the extent that
35
such proceeds are not theretofore used (x) to redeem,
repurchase, retire or otherwise acquire Capital Stock or any
Indebtedness of the Company or any Restricted Subsidiary
pursuant to clause (b)(ii) below or (y) to make any
Restricted Investment pursuant to clause (b)(iv); plus
(3) the amount of the net reduction in Investments in
Unrestricted Subsidiaries resulting from (x) the payment of
dividends or the repayment in cash of the principal of loans
or the cash return on any Investment, in each case to the
extent received by the Company or any Restricted Subsidiary
from Unrestricted Subsidiaries, (y) the release or
extinguishment of any guaranty of Indebtedness of any
Unrestricted Subsidiary, and (z) the redesignation of
Unrestricted Subsidiaries as Restricted Subsidiaries (valued
as provided in the definition of the term "Investment"),
such aggregate amount of the net reduction in Investments
not to exceed in the case of any Unrestricted Subsidiary the
amount of Restricted Investments previously made by the
Company or any Restricted Subsidiary in such Unrestricted
Subsidiary, which amount was included in the calculation of
the amount of Restricted Payments; plus
(4) to the extent that any Restricted Investment that was made
after the Issue Date is sold for cash or the proceeds of
such sale are converted into cash or otherwise liquidated or
repaid for cash, the amount of cash proceeds received with
respect to such Restricted Investment, net of taxes and the
cost of disposition, not to exceed the amount of Restricted
Investments made after the Issue Date.
(b) The foregoing provisions do not prohibit, so long as no Default or
Event of Default is continuing or would occur as a consequence thereof, the
following actions (collectively, "Permitted Payments"):
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at such declaration date such payment would have
been permitted under this Indenture (which payment shall be deemed to have
been paid on such date of declaration for purposes of clause (a)(iii)
above);
(ii) the redemption, repurchase, retirement or other acquisition of
any Capital Stock or any Indebtedness of the Company or any Restricted
Subsidiary in exchange for, or out of the proceeds of, the substantially
concurrent sale (other than to a Restricted Subsidiary) of, or equity
contribution with respect to, Capital Stock of the Company (other than any
Disqualified Stock);
(iii) any purchase or defeasance of Subordinated Indebtedness to the
extent required upon a Change of Control by this Indenture or other
agreement or instrument pursuant to which such Subordinated Indebtedness
was issued or any refinancing of Subordinated Indebtedness permitted by
this Indenture or other agreement or instrument pursuant to which such
Subordinated Indebtedness was issued, but only if the Company has complied
with its obligations under the provisions described under Section 4.15;
(iv) any Restricted Investment to the extent the sole consideration
for which consists of, or is made with the proceeds of the substantially
concurrent sale (other than to a Restricted
36
Subsidiary) of, or equity contribution with respect to, Capital Stock of
the Company (other than any Disqualified Stock);
(v) the repurchase of Capital Stock of the Company (including options,
warrants or other rights to acquire such Capital Stock) from departing or
deceased directors, officers and employees of the Company and its
Subsidiaries pursuant to the terms of an employee benefit plan or employee
agreement in an aggregate amount that shall not exceed $500,000 since the
Issue Date plus the aggregate cash proceeds from any payments on insurance
policies in which the Company or any of its Subsidiaries is the beneficiary
with respect to any directors, officers or employees of the Company and its
Subsidiaries which proceeds are used to purchase the Capital Stock of the
Company or any Restricted Subsidiary of the Company held by any of such
directors, officers or employees; and the repurchase of Capital Stock of
the Company or a Restricted Subsidiary by the Company or such Restricted
Subsidiary pursuant to the terms of any of the Shareholders Agreements;
(vi) loans or advances to employees of the Company or any of its
Subsidiaries which loans or advances exist on the Issue Date, and other
loans or advances to employees of the Company or any Subsidiary to pay
reasonable relocation expenses or otherwise entered into in the ordinary
course of business not to exceed $500,000 in the aggregate principal amount
at any one time outstanding;
(vii) Restricted Payments by a Restricted Subsidiary in an amount such
that the sum of the aggregate amount of Restricted Payments made pursuant
to this clause (vii) after the Issue Date does not exceed $2.5 million at
any one time outstanding; and
(viii) payments pursuant to any of the Transactions.
For purposes of clause (a)(iii) above, the Permitted Payments referred to
in clauses (b)(i) and (v) above shall be included in the aggregate amount of
Restricted Payments made since November 1, 2003, and any other Permitted
Payments described above shall be excluded.
SECTION 4.11. Limitation on Transactions with Affiliates. (a) The Company
will not, nor will it permit any Restricted Subsidiary to, directly or
indirectly, enter into or suffer to exist any transaction or series of related
transactions (including, without limitation, the sale, purchase, exchange or
lease of assets, property or services) with any Affiliate of the Company unless:
(i) such transaction or series of transactions is on terms that are no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
those that could reasonably be obtainable at such time in a comparable
transaction in arm's-length dealings with an unrelated third party, and (ii) the
Company delivers to the Trustee (A) with respect to any transaction or series of
transactions involving aggregate payments in excess of $250,000, an Officers'
Certificate certifying that such transaction or series of related transactions
has been approved by a majority of the members of the Board of Directors of the
Company, and (B) with respect to any transaction or series of transactions
involving aggregate payments in excess of $5.0 million, an opinion as to the
fairness of the transaction to the Company from a financial point of view issued
by an accounting, appraisal or investment banking firm of national standing.
(b) Notwithstanding the foregoing, the provisions of clause (a) above do
not apply to:
(i) employment agreements or compensation or employee benefit
arrangements with any officer, director or employee of the Company or any
of its Restricted Subsidiaries entered into in the ordinary course of
business (including customary benefits thereunder and including
37
reimbursement or advancement of out-of-pocket expenses, and director's and
officer's liability insurance);
(ii) any transaction entered into by or among the Company or one of
its Restricted Subsidiaries with one or more Restricted Subsidiaries of the
Company;
(iii) any transaction permitted by clause (b) of Section 4.10;
(iv) transactions permitted by, and complying with, the provisions
described under Section 5.01;
(v) any Transaction or any transaction described under the caption
"Use of Proceeds" in the Offering Circular pursuant to which the Initial
Notes are offered and sold; and
(vi) agreements to make the payments described in clause (y)(2) of the
second sentence of the definition of the term "Investment" (as defined in
the 2007 Indenture (as in effect on the Issue Date)).
As of the Issue Date, the cash salary and bonus in the aggregate payable to
Xxxx Xxxxxxxx in respect of each fiscal year (i) for which Cash Flow of the
prior fiscal year is less than $25.0 million shall be capped at $750,000, (ii)
for which Cash Flow of the prior fiscal year is greater than or equal to $25.0
million but less than $36.0 million, shall not exceed the sum of (A) $750,000
plus (B) (1) $900,000 times (2) a ratio, the numerator of which is Cash Flow
with respect to such prior fiscal year less $25.0 million and the denominator of
which is $11.0 million and (iii) for which Cash Flow of the prior fiscal year is
greater than or equal to $36.0 million, shall be determined by the Compensation
Committee of the Board of Directors and shall not exceed $2.0 million.
SECTION 4.12. Limitation on Incurrence of Indebtedness. (a) The Company
will not create, incur, assume or directly or indirectly guarantee or in any
other manner become directly or indirectly liable for ("incur") any Indebtedness
(including Acquired Debt), except that the Company may incur Indebtedness
(including Acquired Debt) if, immediately after giving pro forma effect to, such
incurrence of Indebtedness, the Consolidated Cash Flow Coverage Ratio of the
Company for the most recently ended four fiscal quarters would be at least 2.25
to 1.0 if incurred during the period from the Issue Date through October 21,
2005, and 2.50 to 1.0 if incurred thereafter.
(b) The foregoing limitations do not apply to the incurrence of any of the
following, each of which shall be given independent effect:
(1) the Notes issued on the Issue Date;
(2) PIK Notes issued as PIK Interest in accordance with the terms of
the Notes;
(3) guarantees by the Company of Indebtedness incurred by Restricted
Subsidiaries pursuant to the Credit Agreement or evidenced by the 2007
Notes or the 2008 Notes;
(4) any Indebtedness incurred in connection with or given in exchange
for the renewal, extension, substitution, refunding, defeasance,
refinancing or replacement, in whole or in part (a "refinancing"), of any
Indebtedness incurred as permitted under clause (a) of this Section 4.12 or
any Indebtedness described in any of subclauses (1) and (2) above, and this
subclause (4) ("Company Refinancing Indebtedness"); provided, however, that
(a) the principal amount of such Company Refinancing Indebtedness shall not
exceed the principal amount (or accreted amount, if less, or in the case of
a revolving credit facility the maximum amount of the facility, if more) of
the Indebtedness so refinanced (plus accrued interest on the Indebtedness
being refinanced plus
38
the premiums, if any, on the Indebtedness being refinanced and reasonable
expenses to be paid in connection therewith, which, with respect to such
premiums, shall not exceed the stated amount of any premium or other
payment required to be paid in connection with such a refinancing pursuant
to the terms of the Indebtedness being refinanced); and (b) the final
maturity of such Company Refinancing Indebtedness shall not be earlier than
the final maturity of the Indebtedness being Refinanced; and
(5) Indebtedness of the Company to a Restricted Subsidiary of the
Company for so long as such Indebtedness is held by a Restricted Subsidiary
of the Company or the holder of a Subsidiary Permitted Lien, in each case,
subject to no Lien held by a Person other than the Company or a Restricted
Subsidiary of the Company or the holder of a Subsidiary Permitted Lien;
provided that (a) any such Indebtedness is subordinated, pursuant to a
written agreement by the holder thereof, to the Company's Obligations
hereunder and under the Notes and (b) if as of any date any Person other
than a Restricted Subsidiary of the Company or the holder of a Subsidiary
Permitted Lien, owns or holds any such Indebtedness or any Person holds a
Lien in respect of such Indebtedness, such date shall be deemed the
incurrence of Indebtedness not constituting Indebtedness permitted to be
incurred under this subclause (5) by the Company.
(c) The Company will not permit any Restricted Subsidiary to incur any
Indebtedness (including Acquired Debt), except that the Phibro Animal Health and
any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) if,
immediately after giving pro forma effect to, such incurrence of Indebtedness,
the Consolidated Cash Flow Coverage Ratio of Phibro Animal Health for the most
recently ended four fiscal quarters would be at least 2.25 to 1.0 if incurred
during the period from the Issue Date through October 21, 2005, and 2.50 to 1.0
if incurred thereafter.
(d) The foregoing limitations do not apply to the incurrence of any of the
following (collectively, "Permitted Indebtedness"), each of which shall be given
independent effect:
(i) Indebtedness of Phibro Animal Health and its Restricted
Subsidiaries arising under the Credit Agreement, in an aggregate principal
amount not to exceed at any time outstanding an amount equal to $15.0
million;
(ii) Indebtedness of any Restricted Subsidiary in existence, and
Indebtedness pursuant to any commitment in effect under any credit
agreement or facility, in each case, on the Issue Date, other than
Indebtedness described in clause (d)(i) above and Indebtedness incurred in
compliance with clauses (xi), (xiv), (xv) or (xvii) of Section 4.12 of the
2007 Indenture ("Existing Indebtedness");
(iii) Indebtedness of a Restricted Subsidiary to another Restricted
Subsidiary for so long as such Indebtedness is held by a Restricted
Subsidiary; provided that if as of any date any Person other than a
Restricted Subsidiary owns or holds any such Indebtedness, such date shall
be deemed the incurrence of Indebtedness not constituting Permitted
Indebtedness under this subclause (iii) by the issuer of such Indebtedness;
(iv) Indebtedness represented by performance, completion, guarantee,
surety and similar bonds and assurances provided by or for the Company or
any Restricted Subsidiary in the ordinary course of business;
(v) any Indebtedness incurred in connection with a refinancing of any
Indebtedness incurred as permitted under clause (c) above or any
Indebtedness described in subclause (ii) above, and this subclause (v)
("Refinancing Indebtedness"); provided, however, that (a) the principal
amount of such Refinancing Indebtedness shall not exceed the principal
amount (or accreted amount, if less, or in the case of a revolving credit
facility the maximum amount of the facility, if more) of the Indebtedness
so refinanced (plus accrued interest on the Indebtedness
39
being refinanced plus the premiums, if any, on the Indebtedness being
refinanced and reasonable expenses to be paid in connection therewith,
which, with respect to such premiums, shall not exceed the stated amount of
any premium or other payment required to be paid in connection with such a
refinancing pursuant to the terms of the Indebtedness being refinanced);
and (b) the final maturity of such Refinancing Indebtedness shall not be
earlier than the final maturity of the Indebtedness being Refinanced;
(vi) Indebtedness of any Restricted Subsidiary (a) representing
Capital Lease Obligations and any amendments, modifications, renewals,
refundings, replacements or refinancings thereof and/or (b) in respect of
Purchase Money Obligations for property acquired, constructed or improved
in the ordinary course of business and any refinancings thereof, which
taken together in the aggregate principal amount do not exceed $5.0 million
at any one time outstanding;
(vii) (A) commodity agreements entered into in the ordinary course of
business to protect against fluctuations in the prices of raw materials and
not for speculative purposes and (B) foreign currency forward exchange
contracts entered into in the ordinary course of business to protect
against fluctuations in the relative values of currencies that could
adversely affect the results of operations of the Issuer and its Restricted
Subsidiaries, taken as a whole, and not for speculative purposes;
(viii) Indebtedness incurred by any Restricted Subsidiary constituting
reimbursement obligations with respect to letters of credit issued in the
ordinary course of business (A) in respect of (1) workers' compensation
claims or self-insurance or (2) other Indebtedness with respect to
reimbursement type obligations regarding workers' compensation claims or
self-insurance or (B) for regulatory or insurance purposes;
(ix) Indebtedness incurred in respect of letters of credit issued for
the account of any Restricted Subsidiary in an aggregate stated amount not
to exceed $5.0 million (or the foreign currency equivalent thereof being
determined as of the later of the date of the issuance thereof or any date
on which the stated amount of such letter of credit is increased);
(x) Indebtedness of Foreign Restricted Subsidiaries, in an aggregate
principal amount at any time outstanding not to exceed $2.5 million,
incurred to finance losses or costs relating to catastrophic occurrences or
expenses occurring outside of the ordinary course of business; provided,
that, in the case of losses or costs relating to catastrophic occurrences,
the amount of any such losses or costs shall be deemed to be reduced by all
insurance and condemnation proceeds on the thirtieth day following the
receipt thereof by the any Restricted Subsidiary in connection with such
catastrophic occurrence(s);
(xi) Any guaranty by Restricted Subsidiaries of each other's
Indebtedness or the Notes; provided that such other Indebtedness is
permitted to be incurred hereunder;
(xii) Indebtedness of any Restricted Subsidiary in addition to that
described in subclauses (i) through (xi) above and subclauses (xiii) and
(xiv) below, and any amendments, modifications, renewals, refundings,
replacements or refinancings of such Indebtedness, so long as the aggregate
principal amount of all such Indebtedness incurred pursuant to this
subclause (xii) does not exceed $2.5 million at any one time outstanding;
(xiii) Indebtedness arising from agreements of a Restricted Subsidiary
providing for the guarantee, indemnification, adjustment of purchase price
or similar obligations, in each case, incurred in connection with the
disposition of any business, assets or Subsidiary, other than guarantees of
Indebtedness incurred by any Person acquiring all or any portion of such
business, assets or Subsidiary for the purpose of financing such
acquisition; provided that the maximum aggregate liability in respect of
such Indebtedness shall at no time exceed the gross proceeds or
40
value of the consideration actually received by the Restricted Subsidiaries
in connection with such transaction; and
(xiv) Indebtedness of Restricted Subsidiaries arising under the
Belgium Purchase Agreement.
For purposes of determining any particular amount of Indebtedness under
this Section 4.12, any guaranty, Liens or obligations with respect to letters of
credit supporting Indebtedness otherwise included in the determination of such
particular amount shall not be included, except in the case of any such letter
of credit to the extent the stated amount thereof exceeds the principal amount
of such other Indebtedness so supported.
Indebtedness of any Person which is outstanding at the time such Person
becomes a Restricted Subsidiary or is merged with or into or consolidated with
the Company or a Restricted Subsidiary shall be deemed to have been incurred at
the time such Person becomes a Restricted Subsidiary or is merged with or into
or consolidated with the Company or a Restricted Subsidiary, and Indebtedness
which is assumed at the time of the acquisition of any asset shall be deemed to
have been incurred at the time of such acquisition.
SECTION 4.13. Limitation on Dividends and Other Payment Restrictions
Affecting Restricted Subsidiaries. The Company will not, nor will it permit any
Restricted Subsidiary to, directly or indirectly, create or otherwise cause to
become effective any consensual encumbrance or consensual restriction on the
ability of any Restricted Subsidiary to (i) pay dividends or make any other
distributions to the Company or any other Restricted Subsidiary on its Capital
Stock or with respect to any other interest or participation in, or measured by,
its profits, or pay any Indebtedness owed to the Company or any other Restricted
Subsidiary, (ii) make loans or advances to, or issue any guaranty for the
benefit of, the Company or any other Restricted Subsidiary or (iii) transfer any
of its properties or assets to the Company or any other Restricted Subsidiary,
except for such encumbrances or restrictions existing under or by reason of:
(A) the Credit Agreement, the 2007 Indenture and the 2008 Indenture,
in each case, as in effect on the Issue Date, and any amendments,
modifications, renewals, refundings, replacements or refinancings thereof;
provided that such amendments, modifications, renewals, refundings,
replacements or refinancings are no more restrictive in the aggregate with
respect to such dividend and other payment restrictions than those
contained in such agreements (or, if more restrictive, than those contained
in this Indenture) immediately prior to any such amendment, restatement,
renewal, replacement or refinancing;
(B) applicable law;
(C) any instrument governing Indebtedness or Capital Stock of an
Acquired Person acquired by the Company or any of its Restricted
Subsidiaries as in effect at the time of such acquisition (except to the
extent such Indebtedness was incurred in connection with or in
contemplation of such acquisition); provided, however, that no such
encumbrance or restriction is applicable to any Person, or the properties
or assets of any Person, other than the Acquired Person;
(D) customary non-assignment, subletting or net worth provisions in
leases or other agreements entered into the ordinary course of business;
(E) Purchase Money Obligations for property acquired in the ordinary
course of business that impose restrictions only on the property so
acquired;
41
(F) an agreement for the sale or disposition of assets or the Capital
Stock of a Restricted Subsidiary; provided, however, that such restriction
or encumbrance is only applicable to such Restricted Subsidiary or assets,
as applicable, and such sale or disposition otherwise is permitted by
Section 4.16, provided further, however, that such restriction or
encumbrance shall be effective only for a period from the execution and
delivery of such agreement through a termination date not later than 270
days after such execution and delivery (other than any such restriction or
encumbrance contained in the Belgium Purchase Agreement);
(G) Refinancing Indebtedness permitted under this Indenture; provided,
however, that the restrictions contained in the agreements governing such
Refinancing Indebtedness are no more restrictive in the aggregate than
those contained in the agreements governing the Indebtedness being
refinanced immediately prior to such refinancing;
(H) this Indenture, the Notes, and the Collateral Agreements; and
(I) encumbrances and restrictions imposed by amendments, restatements,
renewals, replacements or refinancings of the contracts, instruments or
obligations referred to in clauses (A) through (H) above; provided that
such encumbrances and restrictions are, in the good faith judgment of the
Company's Board of Directors, no more restrictive, in any material respect,
than those contained in such contracts, instruments or obligations
immediately prior to such amendment, restatement, renewal, replacement or
refinancing.
SECTION 4.14. Limitation on Designation of Unrestricted Subsidiaries. (a)
The Company will not designate any Subsidiary of the Company (other than a newly
created Subsidiary in which no Investment has previously been made) as an
"Unrestricted Subsidiary" under this Indenture (a "Designation") unless:
(i) no Default shall have occurred and be continuing at the time of or
after giving effect to such Designation;
(ii) immediately after giving effect to such Designation, Phibro
Animal Health would be able to incur $1.00 of additional Indebtedness
pursuant to clause (c) of Section 4.12; and
(iii) the Company would not be prohibited under this Indenture from
making an Investment at the time of Designation in an amount (the
"Designation Amount") equal to the greater of (x) the book value of such
Restricted Subsidiary on such date and (y) the Fair Market Value of such
Restricted Subsidiary on such date.
In the event of any such Designation, the Company shall be deemed to have
made an Investment constituting a Restricted Payment pursuant to Section 4.10
for all purposes of this Indenture in an amount equal to the Designation Amount.
(b) The Company will not designate an Unrestricted Subsidiary as a
Restricted Subsidiary (a "Redesignation"), unless:
(i) no Default shall have occurred and be continuing at the time of
and after giving effect to such Redesignation; and
(ii) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Redesignation shall be deemed to
have been incurred at such time and shall have been permitted to be
incurred for all purposes of this Indenture.
42
An Unrestricted Subsidiary shall be deemed to be redesignated as a
Restricted Subsidiary at any time if (a) the Company or any other Restricted
Subsidiary (i) provides credit support for, or a guarantee of, any Indebtedness
of such Unrestricted Subsidiary (including any undertaking, agreement or
instrument evidencing such Indebtedness) or (ii) is directly or indirectly
liable for any Indebtedness of such Unrestricted Subsidiary or (b) a default
with respect to any Indebtedness of such Unrestricted Subsidiary (including any
right which the holders thereof may have to take enforcement action against it)
would permit (upon notice, lapse of time or both) any holder of any other
Indebtedness of the Company or any Restricted Subsidiary to declare a default on
such other Indebtedness or cause the payment thereof to be accelerated or
payable prior to its final scheduled maturity, except in the case of clause (a)
to the extent permitted under Section 4.10.
If any Unrestricted Subsidiary is (or is deemed to have been) redesignated
as a Restricted Subsidiary, each Subsidiary of the Company that owns all or any
portion of the Capital Stock of such Unrestricted Subsidiary shall be deemed to
have been redesignated as a Restricted Subsidiary as well.
All Designations and Redesignations must be evidenced by Board Resolutions
delivered to the Trustee certifying compliance with the foregoing provisions.
Subsidiaries that are not designated by the Board of Directors as Restricted or
Unrestricted Subsidiaries will be deemed to be Restricted Subsidiaries. The
Designation of a Restricted Subsidiary as an Unrestricted Subsidiary shall be
deemed a Designation of all of the Subsidiaries of such Unrestricted Subsidiary
as Unrestricted Subsidiaries.
SECTION 4.15. Change of Control. (a) In the event of a Change of Control of
the Issuer, each Holder will have the right, unless the Issuer has given a
notice of redemption, subject to the terms and conditions of this Indenture, to
require the Issuer to offer to purchase all or any portion (equal to $1,000 or
an integral multiple thereof) of such Holder's Notes at a purchase price in cash
equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid
interest to the date of purchase, in accordance with the terms set forth below.
(b) On or before the 30th day following the occurrence of any Change of
Control, the Company will mail an offer (a "Change of Control Offer") to each
Holder at such Holder's registered address a notice by first-class mail stating:
(i) that a Change of Control has occurred and that such Holder has the right to
require the Issuer to purchase all or a portion (equal to $1,000 or an integral
multiple thereof) of such Holder's Notes at a purchase price in cash equal to
101% of the aggregate principal amount thereof, plus accrued and unpaid interest
to the date of purchase (the "Change of Control Purchase Date"), which shall be
a Business Day, specified in such notice, that is not earlier than 30 days or
later than 60 days from the date such notice is mailed, (ii) the amount of
accrued and unpaid interest as of the Change of Control Purchase Date, (iii)
that any Note not tendered will continue to accrue interest, (iv) that, unless
the Company defaults in the payment of the purchase price for the Notes payable
pursuant to the Change of Control Offer, any Notes accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest on the Change of
Control Purchase Date, (v) the procedures, consistent with this Indenture, to be
followed by a Holder in order to accept a Change of Control Offer or to withdraw
such acceptance, and (vi) such other information as may be required by this
Indenture and applicable laws and regulations.
(c) On the Change of Control Purchase Date, the Company will (i) accept for
payment all Notes or portions thereof tendered pursuant to the Change of Control
Offer, (ii) deposit with the Paying Agent the aggregate purchase price of all
Notes or portions thereof accepted for payment, and (iii) deliver or cause to be
delivered to the Trustee all Notes tendered pursuant to the Change of Control
Offer. The Paying Agent shall promptly mail to each Holder whose Notes or
43
portions thereof were accepted for payment an amount equal to the purchase price
for such Notes or portion thereof plus accrued and unpaid interest thereon, and
the Trustee shall promptly authenticate and mail to each Holder whose Notes or
portions thereof were accepted for payment in part a Note equal in principal
amount to any unpurchased portion of the Notes, and any Note not accepted for
payment in whole or in part shall be promptly returned to the Holder of such
Note. On and after a Change of Control Purchase Date, interest will cease to
accrue on the Notes or portions thereof accepted for payment, unless the Company
defaults in the payment of the purchase price therefor. The Issuer will publicly
announce the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Purchase Date.
(d) The Issuer will comply with the applicable tender offer rules,
including the requirements of Section 14(e) and Rule 14e-1 under the Exchange
Act, and all other applicable securities laws and regulations in connection with
any Change of Control Offer and will be deemed not to be in violation of any of
the covenants under this Indenture to the extent such compliance is in conflict
with such covenants.
(e) The Issuer will not be required to make a Change of Control Offer upon
a Change of Control if a third party (i) makes the Change of Control Offer in
the manner, at the times and otherwise in compliance with the requirements set
forth herein (including this Section 4.15) applicable to a Change of Control
Offer made by the Issuer and (ii) purchases all Notes validly tendered and not
withdrawn under such Change of Control Offer.
SECTION 4.16. Limitation on Asset Sales. (a) The Company will not, nor will
it permit any Restricted Subsidiary to, make any Asset Sale unless:
(i) the Company or such Restricted Subsidiary, as the case may be,
receives consideration at the time of such Asset Sale at least equal to the
Fair Market Value (as evidenced by a resolution of the Board of Directors
set forth in an Officers' Certificate delivered to the Trustee) of the
assets or other property sold or disposed of in the Asset Sale; and
(ii) at least 75% of such consideration consists of either cash or
Cash Equivalents.
For purposes of this Section 4.16, "cash" shall include (x) the amount of any
Indebtedness (other than any Indebtedness that is by its terms subordinated to
the Notes), accounts payable and accrued expenses of the Company or such
Restricted Subsidiary that is assumed by the transferee of any such assets or
other property in such Asset Sale (and excluding any liabilities that are
incurred in connection with or in anticipation of such Asset Sale), but only to
the extent that such assumption of Indebtedness is effected on a basis such that
there is no further recourse to the Company or any of the Restricted
Subsidiaries with respect to such liabilities (other than customary
indemnifications to the transferee and its Affiliates) and (y) any notes,
obligations or securities received by the Company or such Restricted Subsidiary
from such transferee that are due and payable within 60 days by the Company or
such Restricted Subsidiary into cash (to the extent of the cash received).
(b) Within 270 days after receipt of Net Proceeds from any Asset Sale, the
Company may elect to apply the Net Proceeds from such Asset Sale:
(i) to repay Indebtedness of a Restricted Subsidiary; and/or
(ii) make an investment in, or acquire assets and properties that will
be used in, the business of the Company or a Restricted Subsidiary,
existing on the Issue Date or in a Related Business.
Pending the final application of any such Net Proceeds, the Company or any
Restricted Subsidiary may temporarily reduce Indebtedness of the Company under
the Credit Agreement or temporarily invest such Net Proceeds in cash or Cash
Equivalents. Any Net Proceeds from an Asset Sale not applied or invested
44
as provided in the first sentence of this clause (b) within 270 days of such
Asset Sale will be deemed to constitute "Excess Proceeds."
(c) Each date that the aggregate amount of Excess Proceeds in respect of
which an Asset Sale Offer (as defined below) has not been made exceeds $5.0
million shall be deemed an "Asset Sale Offer Trigger Date." As soon as
practicable, but in no event later than 20 Business Days after each Asset Sale
Offer Trigger Date, the Company shall commence an offer (an "Asset Sale Offer")
to purchase the maximum principal amount of Notes that may be purchased out of
the Excess Proceeds. Any Notes to be purchased pursuant to an Asset Sale Offer
shall be purchased pro rata based on the aggregate principal amount of Notes
outstanding, and all Notes shall be purchased at an offer price in cash in an
amount equal to 100% of the principal amount thereof, plus accrued and unpaid
interest to the date of purchase. To the extent that any Excess Proceeds remain
after completion of an Asset Sale Offer, the Company may use the remaining
amount for general corporate purposes otherwise permitted by this Indenture.
Upon the consummation of any Asset Sale Offer, the amount of Excess Proceeds
shall be deemed to be reset to zero.
(d) Notice of an Asset Sale Offer shall be mailed by the Company not later
than the 20th Business Day after the related Asset Sale Offer Trigger Date to
each Holder at such Holder's registered address, stating: (i) that an Asset Sale
Offer Trigger Date has occurred and that the Company is offering to purchase the
maximum principal amount of Notes that may be purchased out of the Excess
Proceeds (to the extent provided in the immediately preceding clause (c)), at an
offer price in cash in an amount equal to 100% of the principal amount thereof,
plus accrued and unpaid interest to the date of the purchase (the "Asset Sale
Offer Purchase Date"), which shall be a Business Day, specified in such notice,
that is not earlier than 30 days or later than 60 days from the date such notice
is mailed; (ii) the amount of accrued and unpaid interest as of the Asset Sale
Offer Purchase Date; (iii) that any Note not tendered will continue to accrue
interest; (iv) that, unless the Company defaults in the payment of the purchase
price for the Notes payable pursuant to the Asset Sale Offer, any Notes accepted
for payment pursuant to the Asset Sale Offer shall cease to accrue interest
after the Asset Sale Offer Purchase Date; (v) the procedures, consistent with
this Indenture, to be followed by a Holder in order to accept an Asset Sale
Offer or to withdraw such acceptance; and (vi) such other information as may be
required by this Indenture and applicable laws and regulations.
(e) On the Asset Sale Offer Purchase Date, the Company will (i) accept for
payment the maximum principal amount of Notes or portions thereof tendered
pursuant to the Asset Sale Offer that can be purchased out of Excess Proceeds
from such Asset Sale that are to be applied to an Asset Sale Offer, (ii) deposit
with the Paying Agent the aggregate purchase price of all Notes or portions
thereof accepted for payment, and (iii) deliver or cause to be delivered to the
Trustee all Notes tendered pursuant to the Asset Sale Offer. If less than all
Notes tendered pursuant to the Asset Sale Offer are accepted for payment by the
Company for any reason consistent with this Indenture, selection of the Notes to
be purchased by the Company shall be in compliance with the requirements of the
principal national securities exchange, if any, on which the Notes are listed
or, if the Notes are not so listed, on a pro rata basis or by lot; provided,
however, that Notes accepted for payment in part shall only be purchased in
integral multiples of $1,000. The Paying Agent shall promptly mail to each
Holder or portions thereof accepted for payment an amount equal to the purchase
price for such Notes plus accrued and unpaid interest thereon, and the Trustee
shall promptly authenticate and mail to such Holder accepted for payment in part
a Note equal in principal amount to any unpurchased portion of the Notes, and
any Note not accepted for payment in whole or in part shall be promptly returned
to the Holder of such Note. On and after an Asset Sale Offer Purchase Date,
interest will cease to accrue on the Notes or portions thereof accepted for
payment, unless the Company defaults in the payment of the purchase price
therefor. The Company will publicly announce the results of the Asset Sale Offer
on or as soon as practicable after the Asset Sale Offer Purchase Date.
45
(f) This Section 4.16 shall not apply to a transaction consummated in
compliance with Section 5.01.
(g) The Company shall comply with the applicable tender offer rules,
including the requirements of Section 14(e) and Rule 14e-1 under the Exchange
Act, and all other applicable securities laws and regulations in connection with
any Asset Sale Offer and will be deemed not to be in violation of any of the
covenants under this Indenture to the extent such compliance is in conflict with
such covenants.
SECTION 4.17. Impairment of Security Interest. The Company shall not take
or knowingly omit to take any action which would materially impair the Liens in
favor of the Collateral Agent, on behalf of itself, the Trustee and the Holders,
with respect to any material portion of the Collateral securing the Notes. The
Company shall not grant to any Person (other than the Collateral Agent), or
permit any Person (other than the Collateral Agent) to retain any interest
whatsoever in the Collateral other than Permitted Liens or as otherwise
permitted by this Indenture. The Company shall not enter into any agreement that
requires the proceeds received from any sale of Collateral to be applied to
repay, redeem, defease or otherwise acquire or retire any Indebtedness of any
Person, other than as permitted by this Indenture, the Notes and the Collateral
Agreements. The Company will, at its sole cost and expense, execute and deliver
all such agreements and instruments as the Collateral Agent or the Trustee shall
reasonably request to more fully or accurately describe the property intended to
be Collateral or the obligations intended to be secured by the Collateral
Agreements. The Company will, at its sole cost and expense, file any such notice
filings or other agreements or instruments as may be required under applicable
law to perfect the Liens created by the Collateral Agreements, subject to
Permitted Liens.
SECTION 4.18. Limitation on Liens. The Company will not, directly or
indirectly, create, incur, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired, or any income or profits therefrom, or assign or
convey any right to receive income therefrom, in each case, other than Permitted
Liens.
SECTION 4.19. Business Activities. The Company will not engage in any
business other than the ownership of the Capital Stock of Phibro Animal Health
and activities incidental thereto, nor will the Company permit any of its
Restricted Subsidiaries to engage in any business other than such business as
conducted by them on the Issue Date and any Related Business.
SECTION 4.20. Payments for Consent. The Company will not, nor will it
permit any of its Subsidiaries to, directly or indirectly, pay or cause to be
paid any consideration to or for the benefit of any Holder for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture, the Notes, the Registration Rights Agreement, the Collateral
Agreements or the Escrow Agreement unless such consideration is offered to be
paid or is paid to all Holders that consent, waive or agree to amend in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.
SECTION 4.21. Limitation on Issuances and Sales of Capital Stock of
Subsidiaries. The Company will not permit or cause any of its Restricted
Subsidiaries to issue or sell any Capital Stock except:
(i) to the Company or a Wholly Owned Restricted Subsidiary of the
Company;
(ii) issuances of director's qualifying shares or sales to foreign
nationals of shares of Capital Stock of Foreign Restricted Subsidiaries to
the extent required by applicable law;
46
(iii) if, immediately after giving effect to such issuance or sale,
such Restricted Subsidiary would no longer constitute a Restricted
Subsidiary and any Investment in such Person remaining after giving effect
to such issuance or sale would have been permitted to be made under Section
4.10 if made on the date of such issuance or sale; or
(iv) sales of (A) all of the Capital Stock of a Restricted Subsidiary
of the Company or (B) Common Stock of a Foreign Subsidiary, in each case in
compliance with the provisions of Section 4.16.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Merger, Consolidation and Sale of Assets. The Company shall
not, in any single transaction or series of related transactions, consolidate or
merge with or into (whether or not the Company is the Surviving Person), or
sell, assign, transfer, lease, convey or otherwise dispose of all or
substantially all of its properties or assets (determined on a consolidated
basis for the Company and its Restricted Subsidiaries) in one or more related
transactions to, another Person, nor shall the Company permit any Restricted
Subsidiary to enter into any such transaction or series of related transactions
if such transaction or series of related transactions, in the aggregate, would
result in a sale, assignment, transfer, lease, conveyance or other disposition
of all or substantially all of the properties and assets of the Company and the
Restricted Subsidiaries, taken as a whole, to another Person, unless:
(i) the Surviving Person is a corporation organized or existing under
the laws of the United States, any State thereof or the District of
Columbia;
(ii) the Surviving Person (if other than the Company) assumes (a) all
the obligations of the Company hereunder and under the Notes and, if then
in effect, the Registration Rights Agreement pursuant to a supplemental
indenture or other written agreement, as the case may be, in a form
reasonably satisfactory to the Trustee and (b) by amendment, supplement or
other instrument (in form and substance satisfactory to the Trustee and the
Collateral Agent), executed and delivered to the Trustee, all Obligations
of the Company under the Collateral Agreements, and in connection therewith
shall cause such instruments to be filed and recorded in such jurisdictions
and take such other actions as may be required by applicable law to perfect
or continue the perfection of the Lien created under the Collateral
Agreements on the Collateral owned by or transferred to the surviving
entity;
(iii) immediately both before and after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing;
(iv) after giving pro forma effect to such transaction, the Surviving
Person (x) would have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the Company immediately preceding such
transaction and (y) would be permitted to incur at least $1.00 of
additional Indebtedness pursuant to clause (a) of Section 4.12; and
(v) the Company or the Surviving Person shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, sale, assignment, transfer, lease,
conveyance or other disposition and, if a supplemental indenture or any
amendment or supplement to the Collateral Agreements is required in
connection with such transaction, such supplemental indenture or such
amendment or supplement comply with the
47
applicable provisions of this Indenture and that all conditions precedent
in this Indenture relating to such transaction have been satisfied to the
extent such conditions are required to be satisfied thereunder either prior
to or concurrent with the consummation of the applicable transaction.
Notwithstanding clauses (iii) and (iv) above, any Restricted Subsidiary may
consolidate with, merge into or transfer all or part of its properties and
assets to the Company.
SECTION 5.02. Successor Corporation Substituted. In the event of any
transaction (other than a lease) described in and complying with the conditions
listed in Section 5.01 in which the Company is not the Surviving Person, such
Surviving Person shall succeed to, and be substituted for, and may exercise
every right and power of, the Company, and the Company shall be discharged from
its obligations under, this Indenture, the Notes, the Collateral Agreements and
the Registration Rights Agreement.
ARTICLE SIX
REMEDIES
SECTION 6.01. Events of Default. "Events of Default", wherever used herein,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) a default for 30 days in the payment when due of premium, if any,
or interest on or with respect to any Note;
(b) a default in the payment when due of principal on any Note,
whether upon maturity, acceleration, optional or mandatory redemption,
required repurchase or otherwise;
(c) failure to perform or comply with any covenant, agreement or
warranty in this Indenture (other than the defaults specified in clauses
(i) and (ii) above) or any Collateral Agreement which failure continues for
30 days after written notice thereof has been given to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the then outstanding Notes;
(d) the occurrence of one or more defaults under any agreements,
indentures or instruments under which the Company or any Restricted
Subsidiary then has outstanding Indebtedness in excess of $5.0 million in
the aggregate and, if not already matured at its final maturity in
accordance with its terms, such Indebtedness shall have been accelerated
and such acceleration is not rescinded, annulled or cured within 10 days
thereafter;
(e) one or more judgments, orders or decrees for the payment of money
in excess of $5.0 million, either individually or in the aggregate, shall
be entered against the Company or any Restricted Subsidiary or any of their
respective properties and which judgments, orders or decrees are not paid,
discharged, bonded or stayed or stayed pending appeal for a period of 60
days after their entry;
(f) the Company or any Significant Subsidiary (A) commences a
voluntary case or proceeding under any Bankruptcy Law with respect to
itself, (B) consents to the entry of an order for relief against it in an
involuntary case under any Bankruptcy Law, (C) consents to the appointment
of a Custodian of it or for substantially all of its property, (D) makes a
general
48
assignment for the benefit of its creditors; or (E) takes any corporate
action to authorize or effect any of the foregoing;
(g) a court of competent jurisdiction enters an order or decree that
(A) is an order for relief in respect of the Company or any Significant
Subsidiary in an involuntary case under any Bankruptcy Law, (B) appoints a
Custodian of the Company or any Significant Subsidiary or for substantially
all of its property or (C) orders the winding-up or liquidation of its
affairs; and such order or decree shall remain unstayed and in effect for a
period of sixty (60) consecutive days; or
(h) any Collateral Agreement at any time for any reason shall cease to
be in full force and effect, or the Company denies that it has any further
liability under any Collateral Agreement, or gives notice to such effect
(other than by reason of the termination of this Indenture), or any
Collateral Agreement at any time for any reason shall cease to be effective
in all material respects to grant the Collateral Agent the Liens purported
to be created thereby on a material portion of the Collateral thereunder,
subject to Permitted Liens and no other Liens except as permitted by this
Indenture or the Collateral Agreements, in each case for 30 days after the
Company receives written notice thereof specifying such occurrence from the
Trustee, the Collateral Agent or the Holders of at least 25% of the
outstanding principal amount at maturity of the Notes.
The Issuer shall provide an Officers' Certificate to the Trustee within
five days of the occurrence of any Default or Event of Default (provided,
however, that pursuant to Section 4.06 hereof the Company shall provide such
certification at least annually whether or not they know of any Default or Event
of Default) that has occurred and, if applicable, describe such Default or Event
of Default and the status thereof.
SECTION 6.02. Acceleration. (a) If any Event of Default (other than as
specified in clause (f) or (g) of Section 6.01 with respect to the Issuer)
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of the then outstanding Notes may, and the Trustee at
the request of such Holders shall, declare all the Notes to be due and payable
immediately by notice in writing to the Issuer, and to the Issuer and the
Trustee if by the Holders, specifying the respective Event of Default and that
such notice is a "notice of acceleration," and the Notes shall become
immediately due and payable. Notwithstanding the foregoing, in the case of an
Event of Default arising from the events specified in clause (f) or (g) of
Section 6.01 with respect to the Issuer, the principal of, premium, if any, and
any accrued interest, if any, on all outstanding Notes of the Issuer shall ipso
facto become immediately due and payable without further action or notice.
Holders may not enforce this Indenture or the Notes except as provided in this
Indenture and under the Trust Indenture Act.
(b) At any time after a declaration of acceleration, but before a judgment
or decree for payment of the money due has been obtained by the Trustee, the
Holders of a majority in principal amount of the Notes outstanding, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if (i) the Company has paid or deposited with the Trustee a
sum sufficient to pay (A) all sums paid or advanced by the Trustee and the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, (B) all overdue interest (including any interest accrued
subsequent to an Event of Default specified in clause (f) or (g) of Section 6.01
hereof) on all Notes, (C) the principal of and premium, if any, on any Notes
which have become due otherwise than by such declaration or occurrence of
acceleration and interest thereon at the rate borne by the Notes, and (D) to the
extent that payment of such interest is lawful, interest upon overdue interest
at the rate borne by the Notes; and (ii) all Events of Default, other than the
non-payment of principal of Notes which have become due solely by such
declaration or occurrence of acceleration, have been cured
49
or waived; and (iii) the rescission would not conflict with any judgment, order
or decree of any court of competent jurisdiction.
(c) The Holders of a majority in aggregate principal amount of the Notes
then outstanding by notice to the Trustee may on behalf of all of the Holders
waive any existing Default or Event of Default and its consequences under this
Indenture except (i) a continuing Default or Event of Default in the payment of
the principal of, or premium, if any, or interest, if any, on, the Notes (which
may only be waived with the consent of each affected Holder), or (ii) in respect
of a covenant or provision which under this Indenture cannot be modified or
amended without the consent of each Holder. Subject to certain limitations, the
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from the Holders notice of any continuing Default or Event of Default
(except a Default or Event of Default relating to the payment of principal,
premium or interest) if it determines that withholding notice is in their
interest.
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 the principal of, premium, if any, or
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.
All rights of action and claims under this Indenture or the Notes may be
enforced by the Trustee even if it does not possess any of the Notes or does not
produce any of them in the proceeding. A delay or omission by the Trustee or any
Holder in exercising any right or remedy accruing upon an Event of Default shall
not impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. 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 Defaults. Prior to the declaration of
acceleration of the Notes, the Holders of not less than a majority in aggregate
principal amount of the Notes then outstanding by written notice to the Trustee
may, on behalf of the Holders of all the Notes, waive any existing Default or
Event of Default and its consequences under this Indenture, except a Default or
Event of Default specified in Section 6.01(a) or (b) or in respect of any
provision hereof which cannot be modified or amended without the consent of the
Holder so affected pursuant to Section 9.02. When a Default or Event of Default
is so waived, it shall be deemed cured and shall cease to exist. 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 Notes, as
permitted by the TIA.
SECTION 6.05. Control by Majority. Subject to Section 2.09, the Holders of
the Notes may not enforce this Indenture or the Notes except as provided in this
Article Six and under the TIA. The Holders of not less than a majority in
aggregate principal amount of the outstanding Notes shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, provided, however, that the Trustee may refuse to follow any direction
(a) that conflicts with any rule of law or this Indenture, (b) that the Trustee
determines, in its sole discretion, may be unduly prejudicial to the rights of
another Holder, or (c) that may expose the Trustee to personal liability for
which reasonable indemnity provided to the Trustee against such liability shall
be inadequate; provided further, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent with such direction
or this Indenture. 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 Notes, as permitted by the TIA.
SECTION 6.06. Limitation on Suits. No Holder of any Notes shall have any
right to institute any proceeding with respect to this Indenture or the Notes or
any remedy hereunder, unless the Holders of
50
at least 25% in aggregate principal amount of the outstanding Notes have made
written request, and offered reasonable indemnity satisfactory to the Trustee,
to the Trustee to institute such proceeding as Trustee under the Notes and this
Indenture, the Trustee has failed to institute such proceeding within 45 days
after receipt of such notice, request and offer of indemnity and the Trustee,
within such 45-day period, has not received directions inconsistent with such
written request by Holders of not less than a majority in aggregate principal
amount of the outstanding Notes.
The foregoing limitations shall not apply to a suit instituted by a Holder
of a Note for the enforcement of the payment of the principal of, premium, if
any, or interest on, such Note on or after the respective due dates expressed or
provided for in such Note.
A Holder may not use this Indenture to prejudice the rights of any other
Holders or to obtain priority or preference over such other Holders.
SECTION 6.07. Right of Holders to Receive Payment. Notwithstanding any
other provision in this Indenture, the right of any Holder of a Note to receive
payment of the principal of, premium, if any, and interest on such Note, on or
after the respective due dates expressed or provided for in such Note, or to
bring suit for the enforcement of any such payment on or after the respective
due dates, is absolute and unconditional and shall not be impaired or affected
without the consent of the Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default specified
in clause (a) or (b) of Section 6.01 occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Issuer, or any other obligor on the Notes for the whole amount of the principal
of, premium, if any, and accrued interest remaining unpaid, together with
interest on overdue 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 provided for by the Notes 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, counsel, accountants and experts) and the Holders allowed in any
judicial proceedings relative to the Issuer or Restricted Subsidiaries (or any
other obligor upon the Notes), their creditors or their property and shall be
entitled and empowered to participate as a member, voting or otherwise, of any
official committee of creditors appointed in such matter and 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 Holder to make such payments to the Trustee and, in
the event that the Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 7.07. The Issuer's
payment obligations under this Section 6.09 shall be secured in accordance with
the provisions of 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 Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. Priorities. If the Trustee collects any money pursuant to
this Article Six it shall pay out such money in the following order:
51
First: to the Trustee for amounts due under Section 7.07 and to the
Collateral Agent for amounts due under Section 7.12 as it relates to
Section 7.07;
Second: to Holders for interest accrued on the Notes, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes for interest;
Third: to Holders for the principal amounts (including any premium)
owing under the Notes, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for the principal
(including any premium); and
Fourth: the balance, if any, to the Issuer or any other obligor on the
Notes, as their interests may appear, or as a court of competent
jurisdiction may direct.
The Trustee, upon prior written notice to the Issuer, may fix a record date
and payment date for any payment to Holders 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 may in its discretion require
the filing by any party litigant in the suit of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section 6.11 does not apply to any suit by the Trustee,
any suit by a Holder pursuant to Section 6.07, or a suit by a Holder or Holders
of more than 10% in aggregate principal amount of the outstanding Notes.
SECTION 6.12. Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture or any Note and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to the Trustee or to such Holder,
then and in every such case the Issuer, the Trustee and the Holders shall,
subject to any determination in such proceeding, be restored severally and
respectively to their former positions hereunder, and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee. (a) If an Event of Default has occurred
and is continuing, the Trustee may exercise such of the rights and powers vested
in it by this Indenture and shall use the same degree of care and skill in its
exercise thereof as a prudent person would exercise or use under the
circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties as are specifically set
forth in this Indenture and no duties, covenants or obligations of the
Trustee shall be implied in this Indenture.
(ii) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture.
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However, in the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to the Trustee,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture (but need
not confirm or investigate the accuracy or mathematical calculations or
other facts stated therein or otherwise verify the contents thereof).
(c) Notwithstanding anything to the contrary herein contained, the Trustee
may not be relieved from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) This clause (c) does not limit the effect of clause (b) of this
Section 7.01.
(ii) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(iii) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.02, 6.04 or 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 in the exercise of any of its rights or powers
if it shall have reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not reasonably assured
to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to clauses (a), (b), (c) and (d) of this Section 7.01 and
Section 7.02.
(f) The Trustee shall not be liable for interest on any money or assets
received by it except as the Trustee may agree in writing with the Issuer.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
(g) The Trustee may refuse to perform any duty or exercise any right or
power hereunder unless (i) it is provided adequate funds to enable it to do so
and (ii) it receives indemnity satisfactory to it, in its sole discretion,
against any loss, liability, fee or expense.
SECTION 7.02. Rights of Trustee. Subject to Section 7.01:
(a) The Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any document believed by it to be
genuine and to have been signed or presented by the proper Person. The
Trustee need not and shall not be required to investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel of its selection and may require an Officers' Certificate or
an Opinion of Counsel, or both, which shall conform to Sections 11.04 and
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 its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it reasonably believes to be authorized
or within its rights or powers.
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(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or 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, upon reasonable notice to
the Issuer, to examine the books, records, and premises of the Issuer
personally or by agent or attorney and to consult with the officers and
representatives of the Issuer, including the Issuer's accountants and
attorneys.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee security
or indemnity satisfactory to the Trustee against the costs, expenses and
liabilities which may be incurred by it in compliance with such request,
order or direction.
(g) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(h) Delivery of reports, information and documents to the Trustee
under Section 4.08 is for informational purposes only and the Trustee's
receipt of the foregoing shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Issuer's compliance with any of its covenants
hereunder (as to which the Trustee is entitled to rely exclusively on
Officers' Certificates).
(i) The permissive right of the Trustee to act hereunder shall not be
construed as a duty.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its individual
or any other capacity may become the owner or pledgee of Notes and may otherwise
deal with the Issuer, any of its Subsidiaries, or its Affiliates with the same
rights it would have if it were not Trustee. Any Agent may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 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 Notes, and it shall not be accountable for the Issuer's use of the
proceeds from the Notes, and it shall not be responsible for any statement of
the Company in this Indenture or any document entered into or issued in
connection with the issuance and sale of the Notes or any statement in the Notes
other than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Default. If a Default or an Event of Default occurs
and is continuing and if it is known to a Trust Officer, the Trustee shall mail
to each Holder notice of the uncured Default or Event of Default within 30 days
after obtaining knowledge thereof. Except in the case of a Default or an Event
of Default in payment of principal of, or interest on, any Note, including an
accelerated payment, a Default in payment on (i) the Change of Control Purchase
Date pursuant to a Change of Control Offer or (ii) on the Asset Sale Purchase
Date pursuant to a Asset Sale Offer and a Default in compliance with Section
5.01 hereof, the Trustee may withhold the notice if and so long as its Board of
Directors, the executive committee of its Board of Directors or a committee of
its directors and/or Trust Officers in good faith determines that withholding
the notice is in the interest of the Holders. The foregoing sentence of 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 Notes, as permitted by the TIA.
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SECTION 7.06. Reports by Trustee to Holders. Within 60 days after January
15 of each year beginning with 2006, the Trustee shall, to the extent that any
of the events described in TIA ss. 313(a) occurred within the previous twelve
months, but not otherwise, mail to each Holder a brief report dated as of such
date that complies with TIA ss. 313(a). The Trustee also shall comply with TIA
xx.xx. 313(b), (c) and (d).
A copy of each report at the time of its mailing to Holders shall be mailed
to the Issuer and filed with the Commission and each stock exchange, if any, on
which the Notes are listed.
The Issuer shall promptly, and in any event within 10 days, notify the
Trustee if the Notes become listed on any stock exchange and the Trustee shall
comply with TIA ss. 313(d).
SECTION 7.07. Compensation and Indemnity. The Issuer shall pay to the
Trustee from time to time such compensation for its services as has been agreed
to in writing signed by the Issuer and the Trustee. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Issuer shall reimburse the Trustee upon request for all reasonable
out-of-pocket disbursements, advances or expenses incurred or made by it in
connection with the performance of its duties under this Indenture, any
Collateral Agreement or the Escrow Agreement. Such expenses shall include the
reasonable fees and expenses of the Trustee's agents, counsel, accountants and
experts.
The Issuer shall indemnify each of the Trustee (or any predecessor Trustee)
and its agents, employees, stockholders, Affiliates and directors and officers
for, and hold them each harmless against, any and all loss, liability, damage,
claim or expense (including reasonable fees and expenses of counsel), including
taxes (other than taxes based on the income of the Trustee) incurred by any of
them except for such actions to the extent caused by any gross negligence, bad
faith or willful misconduct on their part, arising out of or in connection with
the acceptance or administration of this trust including the reasonable costs
and expenses of defending themselves against any claim or liability in
connection with the exercise or performance of any of their rights, powers or
duties hereunder, under any Collateral Agreement or the Escrow Agreement. The
Trustee shall notify the Issuer promptly of any claim asserted against the
Trustee for which it may seek indemnity, provided, however, that failure to so
notify the Issuer shall not release the Issuer of its obligations hereunder or
under any Collateral Agreement or the Escrow Agreement unless and to the extent
such failure results in the forfeiture by the Issuer of any substantial rights
or defenses. At the Trustee's sole discretion, the Issuer shall defend the claim
and the Trustee shall cooperate and may participate in the defense; provided,
however, that any settlement of a claim shall be approved in writing by the
Trustee (such approval not to be unreasonably withheld) if such settlement would
result in an admission of liability by the Trustee or if such settlement would
not be accompanied by a full release of the Trustee for all liability arising
out of the events giving rise to such claim. Alternatively, the Trustee may at
its option have separate counsel of its own choosing and the Issuer shall pay
the reasonable fees and expenses of such counsel; provided that the Issuer will
not be required to pay such fees and expenses if the Issuer assumes the
Trustee's defense and there is no conflict of interest between the Issuer and
the Trustee in connection with such defense as reasonably determined by the
Trustee. The Issuer need not pay for any settlement made without its written
consent, which consent will not be unreasonably withheld. The Issuer need not
reimburse any expense or indemnify against any loss or liability to the extent
incurred by the Trustee through its negligence, bad faith or willful misconduct.
To secure the Issuer's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Notes on all assets or money held or
collected by the Trustee, in its capacity as Trustee, except assets or money
held in trust to pay principal of or premium, if any, or interest on particular
Notes.
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When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(f) or (g) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
The provisions of this Section 7.07 shall survive the resignation or
removal of the Trustee and the discharge or termination of this Indenture or any
Collateral Agreement.
SECTION 7.08. Replacement of Trustee. The Trustee may resign at any time by
so notifying the Issuer in writing at least 30 days in advance of such
resignation; provided, however, that no such resignation shall be effective
until a successor Trustee has accepted its appointment pursuant to this Section
7.08. The Holders of a majority in principal amount of the outstanding Notes may
remove the Trustee and appoint a successor Trustee with the Issuer's consent, by
so notifying the Issuer and the Trustee. The Issuer may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent or an order for relief is
entered with respect to the Trustee under any Bankruptcy Law;
(3) a receiver 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 Issuer shall notify each Holder of such event and
shall promptly appoint a successor Trustee. Within one year after the successor
Trustee takes office, the Holders of a majority in aggregate principal amount of
the outstanding Notes may appoint a successor Trustee to replace the successor
Trustee appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Issuer. Immediately after that, the retiring
Trustee shall transfer 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 all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail notice of such successor Trustee's
appointment to each Holder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 10% in aggregate principal amount of the outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
Notwithstanding any resignation or replacement of the Trustee pursuant to
this Section 7.08, the Issuer's 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, the resulting, surviving or
transferee corporation without any further act shall, if such resulting,
surviving or
56
transferee corporation is otherwise eligible hereunder, be the successor
Trustee; provided, however, that such corporation shall be otherwise qualified
and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification. This Indenture shall always
have a Trustee who satisfies the requirement of TIA xx.xx. 310(a)(1), (2) and
(5). The Trustee (or, in the case of a Trustee that is a corporation included in
a bank holding company system, the related bank holding company) shall have a
combined capital and surplus of at least $100 million as set forth in its most
recent published annual report of condition, and have a Corporate Trust Office
in the City of New York. In addition, if the Trustee is a corporation included
in a bank holding company system, the Trustee, independently of such bank
holding company, shall meet the capital requirements of TIA ss. 310(a)(2). The
Trustee shall comply with 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 Issuer are outstanding, if the requirements for such
exclusion set forth in TIA ss. 310(b)(1) are met. The provisions of TIA ss. 310
shall apply to the Issuer, as obligor of the Notes.
SECTION 7.11. Preferential Collection of Claims Against the Issuer. 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. The provisions
of TIA ss. 311 shall apply to the Issuer, as obligor of the Notes.
SECTION 7.12. Trustee as Collateral Agent. References to the Trustee in
Sections 7.01(f), 7.02, 7.03, 7.04, 7.07 and 7.08 shall include the Trustee in
its role as Collateral Agent.
SECTION 7.13. Co-Trustees, Co-Collateral Agents, Sub-Collateral Agent,
Separate Trustees and Separate Collateral Agents. At any time or times, for the
purpose of meeting the legal requirements of any jurisdiction in which any of
the Collateral may at the time be located, the Issuer, the Collateral Agent and
the Trustee shall have power to appoint, and, upon the written request of the
Trustee or of the Holders of at least 25% in principal amount of the Notes
outstanding, the Issuer shall for such purpose join with the Trustee in the
execution, delivery and performance of all instruments and agreements necessary
or proper to appoint, one or more Persons approved by the Trustee either to act
as co-trustee, jointly with the Trustee, of all or any part of the Collateral,
to act as co-collateral agent, jointly with the Collateral Agent, or to act as
separate trustees, separate collateral agents or sub-collateral agent of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid, any property, title, right or power deemed necessary or desirable,
subject to the other provisions of this Section 7.13. If the Issuer does not
join in such appointment within 15 days after the receipt by it of a request so
to do, or in case an Event of Default has occurred and is continuing, the
Trustee alone shall have power to make such appointment.
Should any written instrument from the Issuer be required by any
co-trustee, co-collateral agent, separate trustee, separate collateral agent or
sub-collateral agent so appointed for more fully confirming to such co-trustee,
co-collateral agent, separate trustee, separate collateral agent or
sub-collateral agent such property, title, right or power, any and all such
instruments shall, on request, be executed, acknowledged and delivered by the
Issuer.
Every co-trustee, co-collateral agent, separate trustee, separate
collateral agent or sub-collateral agent shall, to the extent permitted by law,
but to such extent only, be appointed subject to the following terms, namely:
(a) The Notes shall be authenticated and delivered, and all rights,
powers, duties and obligations hereunder in respect of the custody of
securities, cash and other personal property held
57
by, or required to be deposited or pledged with, the Trustee hereunder,
shall be exercised solely, by the Trustee.
(b) The rights, powers, duties and obligations hereby conferred or
imposed upon the Trustee in respect of any property covered by such
appointment shall be conferred or imposed upon and exercised or performed
by the Trustee or by the Trustee and such co-trustee or separate trustee
jointly, or by the Collateral Agent and such co-collateral agent or
separate collateral agent or sub-collateral agent, jointly as shall be
provided in the instrument appointing such co-trustee, co-collateral agent,
separate trustee, separate collateral agent or sub-collateral agent, except
to the extent that under any law of any jurisdiction in which any
particular act is to be performed, the Trustee or Collateral Agent shall be
incompetent or unqualified to perform such act, in which event such rights,
powers, duties and obligations (including the holding of title to the
collateral or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such co-trustee, co-collateral agent,
separate trustee, separate collateral agent or sub-collateral agent, but
solely at the discretion of the Trustee or Collateral Agent, as applicable.
(c) The Trustee at any time, by an instrument in writing executed by
it, with the concurrence of the Issuer evidenced by a Board Resolution, may
accept the resignation of or remove any co-trustee, co-collateral agent,
separate trustee, separate collateral agent or sub-collateral agent
appointed under this Section 7.13, and, in case an Event of Default has
occurred and is continuing, the Trustee shall have power to accept the
resignation of, or remove, any such co-trustee, co-collateral agent,
separate trustee, separate collateral agent or sub-collateral agent without
the concurrence of the Issuer. Upon the written request of the Trustee, the
Issuer shall join with the Trustee in the execution, delivery and
performance of all instruments and agreements necessary or proper to
effectuate such resignation or removal. A successor to any co-trustee,
co-collateral agent, separate trustee, separate collateral agent or
sub-collateral agent so resigned or removed may be appointed in the manner
provided in this Section 7.13.
(d) No co-trustee, co-collateral agent, separate trustee, separate
collateral agent or sub-collateral agent hereunder shall be personally
liable by reason of any act or omission of the Trustee, the Collateral
Agent or any other such trustee or collateral agent hereunder.
Any act of Holders delivered to the Trustee or Collateral Agent shall be
deemed to have been delivered to each such co-trustee, co-collateral agent,
separate trustee, separate collateral agent and sub-collateral agent.
Any notice, request or other writing given to the Trustee or Collateral
Agent shall be deemed to have been given to each of the then separate trustees,
separate collateral agent, sub-collateral agent, co-trustees and co-collateral
agents, as effectively as if given to each of them. Every instrument appointing
any co-trustee, co-collateral agent, separate trustee, separate collateral agent
or sub-collateral agent shall refer to this Indenture and the conditions of this
Article 7. Each co-trustee, co-collateral agent, separate trustee, separate
collateral agent and sub-collateral agent, upon its acceptance of the trusts
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee or separately, as may
be provided therein, subject to all the provisions of this Indenture,
specifically including the benefit of every provision of this Indenture relating
to the conduct of, affecting the liability of, or affording protection or rights
(including the rights to compensation, reimbursement and indemnification
hereunder) to, the Trustee. Every such instrument shall be filed with the
Trustee.
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ARTICLE EIGHT
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 8.01. Satisfaction and Discharge of Indenture. This Indenture will
be discharged and will cease to be of further effect (except as to surviving
rights of registration of transfer or exchange of the Notes, as expressly
provided for in this Indenture) as to all outstanding Notes when:
(i) either (A) all Notes theretofore authenticated and delivered
(except lost, stolen or destroyed Notes which have been replaced or paid
and Notes for whose payment money has theretofore been deposited in trust
and thereafter repaid to the Issuer) have been delivered to the Trustee for
cancellation or (B) all Notes not theretofore delivered to the Trustee for
cancellation have become due and payable and the Issuer has irrevocably
deposited or caused to be deposited with the Trustee an amount in United
States Dollars sufficient to pay and discharge the entire indebtedness on
the Notes not theretofore delivered to the Trustee for cancellation, for
the principal of, premium, if any, interest, if any, to the date of
deposit;
(ii) the Issuer has paid or caused to be paid all other sums payable
under this Indenture by the Company; and
(iii) the Issuer has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that all conditions precedent under
this Indenture relating to the satisfaction and discharge of this Indenture
have been complied with.
SECTION 8.02. Defeasance or Covenant Defeasance. (a) Subject to the
satisfaction of the conditions in Section 8.02(c) hereof, the Issuer may, at its
option by Board Resolution, at any time, with respect to the Notes, elect to
have the obligations of the Issuer discharged with respect to the outstanding
Notes ("defeasance"). Upon such defeasance, the Issuer shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Notes, which shall thereafter be deemed to be "outstanding" only for the
purposes of Section 8.04 hereof and the other Sections of and matters under this
Indenture referred to in (i) and (ii) below, and to have satisfied all its other
obligations under such Notes and this Indenture, except for the following, which
shall survive until otherwise terminated or discharged hereunder: (i) the rights
of Holders of Notes to receive solely from the trust fund described in Section
8.02(c) and as more fully set forth in such Section, payments in respect of the
principal of, premium, if any, and interest, if any, on such Notes when such
payments are due, (ii) the Company's obligations under Sections 2.03, 2.05,
2.06, 2.07, 2.10 and 4.02, (iii) the rights, powers, trusts, duties and
immunities of the Trustee hereunder, including, without limitation, the
Trustee's rights under Section 7.07, and (iv) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its option under
this Section 8.02(a) notwithstanding the prior exercise of its option under
Section 8.02(b) with respect to the Notes.
(b) Subject to the satisfaction of the conditions in Section 8.02(c)
hereof, the Issuer may, at its option by Board Resolution, at any time, elect to
effect covenant defeasance ("covenant defeasance"). On and after the date such
conditions are satisfied, (i) the Issuer shall be released from its obligations
under any covenant or provision contained in Sections 4.03 (but only as to
Restricted Subsidiaries), 4.04, 4.05, 4.06, 4.07, 4.08 and 4.10 through 4.21,
(ii) clauses (c) and (d) of Section 6.01 hereof shall not apply, and (iii) the
provisions of Section 5.01 and the Notes shall thereafter be deemed to be not
"outstanding" for the purposes of any direction, waiver, consent or declaration
or act of Holders (and the consequences of any thereof) in connection with such
covenants and the provisions of Section 5.01, but shall continue to be deemed
"outstanding" for all other purposes hereunder and subject to any mandatory
requirements of the TIA. For this purpose, such covenant defeasance means that,
with respect to the Notes, the Issuer may
59
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such Section or Article, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
Section or Article or by reason of any reference in any such Section or Article
to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under clauses (c)
and (d) of Section 6.01 hereof, but, except as specified above, the remainder of
this Indenture shall be unaffected thereby.
(c) In order to effect defeasance or covenant defeasance, the following
conditions must be satisfied:
(i) the Issuer shall irrevocably deposit with the Trustee, as trust
funds in trust, for the benefit of the Holders, cash in United States
Dollars, U.S. Government Obligations, or a combination thereof, in such
amounts as will be sufficient, in the report of a nationally recognized
firm of independent public accountants or a nationally recognized
investment banking firm, to pay and discharge the principal of, premium, if
any, and interest, if any, on the outstanding Notes to redemption or
maturity;
(ii) the Issuer shall have delivered to the Trustee an Opinion of
Counsel in the United States to the effect that the Holders will not
recognize income, gain or loss for Federal income tax purposes as a result
of such defeasance or covenant defeasance, as the case may be, and will be
subject to Federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such defeasance or
covenant defeasance, as the case may be, had not occurred (in the case of
defeasance, such Opinion of Counsel must refer to and be based upon a
ruling of the Internal Revenue Service or a change in applicable Federal
income tax laws);
(iii) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or insofar as clause (f) or (g)
under Section 6.01 is concerned, at any time during the period ending on
the 91st day after the date of deposit;
(iv) such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a Default under this Indenture or a
default under any other agreement or instrument to which the Issuer is a
party or by which it is bound;
(v) the Issuer shall have delivered to the Trustee Opinions of Counsel
to the effect that (A) the trust funds will not be subject to any rights of
holders of Indebtedness (other than the Holders) and (B) after the 91st day
following the deposit, the trust funds will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally; and
(vi) the Issuer shall have delivered to the Trustee an Officers'
Certificate and Opinions of Counsel, each stating that all conditions
precedent under this Indenture to either defeasance or covenant defeasance,
as the case may be, have been complied with and that no violations under
agreements governing any other outstanding Indebtedness would result
therefrom.
SECTION 8.03. Application of Trust Money. The Trustee or Paying Agent shall
hold in trust U.S. Legal Tender or U.S. Government Obligations deposited with it
pursuant to Section 8.01 or 8.02, and shall apply the deposited U.S. Legal
Tender and the money from U.S. Government Obligations in accordance with this
Indenture to the payment of the principal of and interest on the Notes. The
Trustee shall be under no obligation to invest said U.S. Legal Tender or U.S.
Government Obligations except as it may agree in writing with the Issuer.
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The Issuer shall pay, and indemnify the Trustee against, any tax, fee or
other charge imposed on or assessed against the U.S. Legal Tender or U.S.
Government Obligations deposited pursuant to Section 8.01 or 8.02 or the
principal and interest received in respect thereof other than any such tax, fee
or other charge which by law is for the account of the Holders of outstanding
Notes.
SECTION 8.04. Repayment to the Issuer. Subject to Sections 8.01 and 8.02,
the Trustee and the Paying Agent shall promptly pay to the Issuer upon written
request any excess U.S. Legal Tender or U.S. Government Obligations held by them
at any time and thereupon shall be relieved from all liability with respect to
such money. The Trustee and the Paying Agent shall pay to the Issuer upon
request any money held by them for the payment of principal or interest that
remains unclaimed for one year; provided, however, that the Trustee or such
Paying Agent, before being required to make any payment, may at the expense of
the Issuer cause to be published once in a newspaper of general circulation in
the City of New York or mail to each Holder entitled to such money notice that
such money remains unclaimed and that after a date specified therein which shall
be at least 30 days from the date of such publication or mailing any unclaimed
balance of such money then remaining will be repaid to the Issuer. After payment
to the Issuer, Holders entitled to such money must look to the Issuer for
payment as general creditors unless an applicable law designates another Person.
SECTION 8.05. Reinstatement. If the Trustee or Paying Agent is unable to
apply any U.S. Legal Tender or U.S. Government Obligations in accordance with
Section 8.01 or 8.02 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 Issuer's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 8.01 or 8.02, as the case may be, until such time
as the Trustee or Paying Agent is permitted to apply all such U.S. Legal Tender
or U.S. Government Obligations in accordance with Section 8.01 or 8.02, as the
case may be; provided, however, that if the Issuer has made any payment of
interest on or principal of any Notes because of the reinstatement of its
obligations, the Issuer shall be subrogated to the rights of the Holders of such
Notes to receive such payment from the U.S. Legal Tender or U.S. Government
Obligations held by the Trustee or Paying Agent.
SECTION 8.06. Acknowledgment of Discharge by Trustee. After (i) the
conditions of Section 8.01 or 8.02(a) have been satisfied, (ii) the Issuer has
paid or caused to be paid all other sums payable hereunder by the Issuer and
(iii) the Issuer has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that all conditions precedent referred to in
clause (i), above, relating to the satisfaction and discharge or defeasance of
this Indenture have been complied with, the Trustee upon request shall
acknowledge in writing the discharge of the Issuer's obligations under this
Indenture except for those surviving obligations specified in Section 8.01 or
8.02, as the case may be.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders. The Issuer, when authorized by a
Board Resolution, and the Trustee, together, may amend or supplement this
Indenture, any Collateral Agreement, the Escrow Agreement or the Notes without
notice to or consent of any Holder:
(i) to cure any ambiguity, defect or inconsistency;
(ii) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
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(iii) to provide for the assumption of the Issuer's Obligations to
Holders in the event of any Disposition involving the Issuer in which the
Issuer is not the Surviving Person;
(iv) to make any change that would provide any additional rights or
benefits to the Holders or that does not adversely affect the rights of any
such Holder; or
(v) to comply with the requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust
Indenture Act.
SECTION 9.02. With Consent of Holders. (a) Subject to Section 6.07, the
Issuer, when authorized by a Board Resolution, and the Trustee, together, with
the written consent of the Holder or Holders of at least a majority in aggregate
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for the Notes), may amend or
supplement this Indenture, any Collateral Agreement, the Escrow Agreement or the
Notes without notice to any other Holder. Subject to Section 6.02 and 6.07, the
Holder or Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes may waive compliance by the Issuer with any provision
of this Indenture, any Collateral Agreement, the Escrow Agreement or the Notes
without notice to any other Holder.
(b) Notwithstanding Section 9.02(a) hereof, no amendment, supplement or
waiver, including a waiver pursuant to Section 6.04, shall, without the prior
written consent of each Holder of each Note affected thereby:
(i) reduce the principal amount of the Notes whose Holders must
consent to an amendment, supplement or waiver;
(ii) reduce the principal of or change the fixed maturity of any Note,
or alter or waive the provisions with respect to the redemption of the
Notes in a manner adverse to the Holders other than with respect to a
Change of Control Offer or an Asset Sale Offer;
(iii) reduce the rate of or change the time for payment of interest on
any Notes;
(iv) waive a Default or Event of Default in the payment of principal
of, premium, if any, or interest, if any, on the Notes (except that the
Holders of at least a majority in aggregate principal amount of the then
outstanding Notes may (a) rescind an acceleration of the Notes that
resulted from a non-payment default, and (b) waive the payment default that
resulted from such acceleration);
(v) make any Note payable in money other than that stated in the
Notes;
(vi) make any change in the provisions of this Indenture relating to
the right of the Holders to waive past Defaults or the rights of the
Holders to receive payments of principal of, or premium, if any, or
interest, if any, on, the Notes;
(vii) following the occurrence of a Change of Control, amend, change
or modify the Issuer's obligation to make and consummate a Change of
Control Offer by reason of such a Change of Control or modify any of the
provisions or definitions with respect thereto in a manner adverse to the
Holders with respect to such Change of Control, or following the occurrence
of an Asset Sale, amend, change or modify the Issuer's obligations to make
and consummate an Asset Sale Offer with respect to such Asset Sale or
modify any of the provisions or definitions with respect thereto in a
manner adverse to the Holders with respect to such Asset Sale Offer; or
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(viii) release all or substantially all of the Collateral.
SECTION 9.03. Compliance with TIA. Every amendment, waiver or supplement of
this Indenture, any Collateral Agreement, the Escrow Agreement or the Notes
shall comply with the TIA as then in effect; provided, however, that this
Section 9.03 shall not of itself require that this Indenture or the Trustee be
qualified under the TIA or constitute any admission or acknowledgment by any
party hereto that any such qualification is required prior to the time this
Indenture and the Trustee are required by the TIA to be so qualified.
SECTION 9.04. Revocation and Effect of Consents. Until an amendment, waiver
or supplement becomes effective, a consent to it by a Holder is a continuing
consent by the Holder and every subsequent Holder of a Note or portion of a Note
that evidences the same debt as the consenting Holder's Note, even if notation
of the consent is not made on any Note. Subject to the following paragraph, any
such Holder or subsequent Holder may revoke the consent as to such Holder's Note
or portion of such Note by notice to the Trustee or the Issuer received before
the date on which the Trustee receives an Officers' Certificate certifying that
the Holders of the requisite principal amount of Notes have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver. An
amendment, supplement or waiver becomes effective upon receipt by the Trustee of
such Officers' Certificate and evidence of consent by the Holders of the
requisite percentage in principal amount of outstanding Notes.
The Issuer may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be at least 30 days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the second sentence of the immediately preceding paragraph,
those Persons who were Holders at such record date (or their duly designated
proxies), and only those Persons, shall be entitled to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, it shall bind
every Holder, unless it makes any change described in Section 9.02(b), in which
case, the amendment, supplement or waiver shall bind only each Holder of a Note
who has consented to it and every subsequent Holder of a Note or portion of a
Note that evidences the same debt as the consenting Holder's Note; provided,
however, that any such waiver shall not impair or affect the right of any Holder
to receive payment of principal of and interest on a Note, on or after the
respective due dates expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates without the
consent of such Holder.
SECTION 9.05. Notation on or Exchange of Notes. If an amendment, supplement
or waiver changes the terms of a Note, the Trustee may require the Holder of
such Note to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Note about the changed terms and return it to the Holder.
Alternatively, if the Issuer or the Trustee so determines, the Issuer in
exchange for the Note shall issue and the Trustee shall authenticate a new Note
that reflects the changed terms.
SECTION 9.06. Trustee To Sign Amendments, Etc. The Trustee shall execute
any amendment, supplement or waiver authorized pursuant to this Article Nine;
provided, however, that the Trustee may, but shall not be obligated to, execute
any such amendment, supplement or waiver which affects the Trustee's own rights,
duties or immunities under this Indenture, any Collateral Agreement or the
Escrow Agreement. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel and an Officers' Certificate
each stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture. Such Opinion of Counsel shall not be an expense of the Trustee or the
Holders.
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ARTICLE TEN
SECURITY
SECTION 10.01. Grant of Security Interest. To secure the due and punctual
payment of the principal of, premium, if any, and interest on the Notes and
amounts due hereunder when and as the same shall be due and payable, whether on
an Interest Payment Date, at maturity, by acceleration, purchase, repurchase,
redemption or otherwise, and interest on the overdue principal of, premium, if
any, and interest (to the extent permitted by law), if any, on the Notes and the
performance of all other Obligations of the Issuer to the Holders, the
Collateral Agent or the Trustee under this Indenture and the Notes, as
applicable, the Company hereby covenants to execute and deliver the Collateral
Agreements concurrently with this Indenture. The Collateral Agreements shall
grant to the Collateral Agent for the benefit of each Secured Party Security
Interests in the Collateral and shall be deemed hereby incorporated by reference
herein to the same extent and as fully as if set forth in their entirety at this
place, and reference is made hereby to each Collateral Agreement for a more
complete description of the terms and provisions thereof.
The Trustee and each Holder, by its acceptance of a Note, consents and
agrees to the terms of each Collateral Agreement, as the same may be in effect
or may be amended from time to time in accordance with its terms, and authorizes
and directs the Collateral Agent to enter into the Collateral Agreements and to
perform its obligations and exercise its rights thereunder in accordance
therewith. The Issuer shall, and shall cause each of its Subsidiaries to, do or
cause to be done, at its sole cost and expense, all such actions and things as
may be necessary or proper, or as may be required by the provisions of the
Collateral Agreements, to assure and confirm to the Trustee and the Collateral
Agent the Security Interests in the Collateral contemplated hereby and by the
Collateral Agreements, as from time to time constituted, so as to render the
same available for the security and benefit of this Indenture and of the Notes
secured hereby, according to the intent and purpose herein and therein
expressed. The Issuer shall, and shall cause each of its Subsidiaries to take
any and all actions required to cause the Collateral Agreements to create and
maintain, as security for the Obligations contained in this Indenture and the
Notes, valid and enforceable, perfected (except as expressly provided herein or
therein) Security Interests in and on all the Collateral, in favor of the
Collateral Agent, superior to and prior to the rights of all third Persons, and
subject to no other Liens, in each case, except as expressly provided herein or
therein.
SECTION 10.02. Recording and Opinions. (a) The Issuer shall take or cause
to be taken all action required to perfect, maintain, preserve and protect the
Security Interests in the Collateral granted by the Collateral Agreements to the
extent set forth in such Collateral Agreement. The Issuer shall from time to
time promptly pay all financing and continuation statement recording and/or
filing fees, charges and taxes relating to this Indenture, the Collateral
Agreements, the Escrow Agreement and any amendments hereto or thereto and any
other instruments of further assurance required pursuant hereto or thereto.
(b) The Issuer shall furnish to the Trustee and the Collateral Agent (if
other than the Trustee), on the Closing Date, at such time as required by
Section 314(b) of the TIA, and promptly after the execution and delivery of any
other instrument of further assurance or amendment granting, perfecting,
protecting, preserving or making effective a security interest pursuant to any
Collateral Agreement, an Opinion of Counsel either (i) stating that, in the
opinion of such counsel, this Indenture and the Collateral Agreements and
financing statements then executed and delivered, as applicable, and all other
instruments of further assurance or amendment then executed and delivered have
been properly recorded, registered and filed, and all certificates evidencing
capital stock pledged to the Trustee and the Holders under the Collateral
Agreements have been, subject to the terms of the Collateral Agreement,
delivered and duly endorsed in blank, to the extent necessary to perfect the
Security Interests created by this Indenture and the Collateral Agreements and
reciting the details of such action or referring to prior
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Opinions of Counsel in which such details are given, and stating that as to such
Collateral Agreements and such other instruments, such recording, registering,
filing and delivery are the only recordings, registerings, filings and
deliveries necessary to perfect such security interest and that no
re-recordings, re-registerings, re-filings or re-deliveries are necessary to
maintain such perfection, and further stating that all financing statements and
continuation statements have been executed and filed, and all such certificates
have been delivered, that are necessary to perfect such security interests of
the Holders, the Trustee and the Collateral Agent hereunder and under the
Collateral Agreements or (ii) stating that, in the Opinion of such Counsel, no
such action is necessary to perfect any Security Interest created under this
Indenture, the Notes or any of the Collateral Agreements as intended by this
Indenture, the Notes and such Collateral Agreements.
(c) Annually, within 30 days after August 1 and beginning with the year
2006, the Issuer shall furnish to the Trustee and the Collateral Agent (if other
than the Trustee), one or more Opinions of Counsel, dated as of such date,
either (i) stating that: (A) in the opinion of such counsel, action has been
taken with respect to the registering, recording, filing, re-recording,
re-registering and refiling of financing statements, continuation statements and
other documents, and delivery of all certificates, as are then necessary to
perfect or continue the perfection of the Security Interests created by the
Collateral Agreements, subject to the terms of the Collateral Agreements, and
reciting the details of such action or referring to prior Opinions of Counsel in
which such details are given; and (B) based on relevant laws as in effect on the
date of such Opinion of Counsel, all financing statements, continuation
statements and other documents have been executed (if necessary) and filed that
are necessary as of such date and during the succeeding 6 months fully to
maintain, perfect or continue the perfection of such Security Interests under
the Collateral Agreements with respect to the Collateral and to maintain,
preserve, and protect the rights of the Holders, the Collateral Agent and the
Trustee hereunder and under the Collateral Agreements or (ii) stating that, in
the opinion of such counsel, no such action is then necessary to perfect or
continue the perfection of such Security Interests.
SECTION 10.03. Release of Collateral. (a) The Collateral Agent shall not at
any time release Collateral from the Security Interests created by this
Indenture and the Collateral Agreements unless such release is in accordance
with the provisions of this Indenture and the applicable Collateral Agreements.
(b) At any time when a Default or an Event of Default shall have occurred
and be continuing, no release of Collateral pursuant to the provisions of this
Indenture and the Collateral Agreements shall be effective as against any
Secured Party.
(c) The release of any Collateral from the terms of the Collateral
Agreements shall not be deemed to impair the security under this Indenture in
contravention of the provisions hereof if and to the extent the Collateral is
released pursuant to this Indenture and the Collateral Agreements. To the extent
applicable, the Issuer shall cause Section 314(d) of the TIA relating to the
release of property from the Security Interests created by this Indenture and
the Collateral Agreements to be complied with. Any certificate or opinion
required by Section 314(d) of the TIA may be made by an Officer of the Issuer,
except in cases where Section 314(d) of the TIA requires that such certificate
or opinion be made by an independent Person, which Person shall be an
independent engineer, appraiser or other expert selected or approved by the
Trustee in the exercise of reasonable care. A Person is "independent" if such
Person (a) is in fact independent, (b) does not have any direct financial
interest or any material indirect financial interest in the Issuer or in any
Affiliate of the Issuer and (c) is not an officer, employee, promoter,
underwriter, trustee, partner or director or person performing similar functions
to any of the foregoing for the Issuer. The Trustee and the Collateral Agent
shall be entitled to receive and conclusively rely upon a certificate provided
by any such Person confirming that such Person is independent within the
foregoing definition.
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SECTION 10.04. Specified Releases of Collateral. (a) The Issuer shall be
entitled to obtain a full release of items of Collateral (the "Released
Interests") from the Security Interests created by this Indenture and the
Collateral Agreements upon compliance with the conditions precedent set forth in
Sections 4.16, 8.01 or 8.02 of this Indenture and the applicable Collateral
Agreements. So long as no Default or Event of Default exists, upon the request
of the Issuer and the furnishing of each of the items required by Section
10.04(b), the Collateral Agent upon the direction of the Trustee (or the Trustee
if acting as Collateral Agent) shall forthwith take all necessary action (at the
request of and the expense of the Issuer, without recourse or warranty and
without any representation of any kind), including the delivery of appropriate
UCC-3 termination statements (and authorization to file such termination
statements) or any other filing required to be made, to release and reconvey to
the Issuer all of the Released Interests, and shall deliver such Released
Interests in its possession to the Issuer.
(b) So long as no Default or Event of Default exists, the Issuer shall be
entitled to obtain a release of, and the Collateral Agent shall release, the
Released Interests upon compliance with the condition precedent that the Issuer
shall have satisfied all applicable conditions precedent to any such release set
forth in this Indenture, the applicable Collateral Agreements and shall have
delivered to the Trustee and the Collateral Agent the following, as applicable:
(i) in connection with release of Collateral resulting from an Asset
Sale under Section 4.16, written notice from the Company requesting the
release of the Released Interests: (A) describing the proposed Released
Interests; and (B) specifying the Fair Market Value of such Released
Interests on a date within 60 days of such notice (the "Valuation Date");
(ii) in connection with release of Collateral resulting from an Asset
Sale under Section 4.16, an Officers' Certificate of the Company certifying
that: (A) such Asset Sale complies with the terms and conditions of this
Indenture with respect to such Asset Sale to the extent such terms and
conditions are required to be satisfied hereunder either prior to or
concurrent with the consummation of such Asset Sale; (B) there is no
Default or Event of Default in effect or continuing on the date thereof or
the date of such Asset Sale; (C) the release of the Collateral will not
result in a Default or Event of Default under this Indenture; (D) the
purchase price received is at least equal to the Fair Market Value of the
Released Interests; (E) the release of such Released Interests would not be
expected to interfere in any material respect with the Collateral Agent's
ability to realize the value of the remaining Collateral and will not
impair in any material respect the maintenance and operation of the
remaining Collateral; and (F) all conditions precedent in this Indenture
relating to the release in question have been or will be complied with; and
(iii) in connection with release of Collateral resulting from an Asset
Sale under Section 4.16, an Opinion of Counsel certifying that all
conditions precedent to the release of the Released Interests have been met
and that such release complies with the terms and conditions of this
Indenture and the applicable Collateral Agreements.
(iv) all applicable certificates, opinions and other documentation
required by the TIA or this Indenture, if any.
Upon compliance by the Issuer with the conditions precedent set forth
above, the Collateral Agent shall cause to be released and reconveyed, without
recourse and without representation or warranty of any kind, to the Issuer, the
Released Interests.
(c) So long as no Default or Event of Default exists, the Issuer shall be
entitled to obtain a release of the Liens granted in favor of the Collateral
Agent for the benefit of itself, the Trustee and the
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Holders on Collateral (including Collateral consisting of the Capital Stock of
any Restricted Subsidiary and any equipment that is obsolete or no longer useful
in the business of the Issuer) and proceeds thereof that is sold, conveyed or
otherwise disposed of by the Issuer (including by way of a sale-and-leaseback)
in the ordinary course of business, whether in a single transaction or a series
of related transactions, to any Person for Net Proceeds of $250,000 or less
shall be subject to termination and release upon the consummation of any such
sale, conveyance or disposition.
(d) Upon compliance by the Issuer with the conditions precedent set forth
in clause (c) above, the Lien granted under the Collateral Agreements on such
items of Collateral shall terminate and be released automatically and without
any action by or on behalf of the Collateral Agent.
SECTION 10.05. Form and Sufficiency of Release. In the event that the
Issuer has sold, exchanged, or otherwise disposed of or proposes to sell,
exchange or otherwise dispose of any portion of the Collateral that may be sold,
exchanged or otherwise disposed of by the Issuer, and the Issuer requests in
writing that the Collateral Agent furnish a written disclaimer, release or
quit-claim of any interest in such property under this Indenture and the
Collateral Agreements, the Collateral Agent shall execute, acknowledge and
deliver to the Issuer (in proper form) such an instrument promptly after
satisfaction of the conditions set forth herein for delivery of any such
release. Notwithstanding the preceding sentence, all purchasers and grantees of
any property or rights purporting to be released herefrom shall be entitled to
rely upon any release executed by the Collateral Agent hereunder as sufficient
for the purpose of this Indenture and as constituting a good and valid release
of the property therein described from the Lien of this Indenture or of the
Collateral Agreements.
SECTION 10.06. Purchaser Protected. No purchaser or grantee of any property
or rights purporting to be released herefrom shall be bound to ascertain the
authority of the Collateral Agent to execute the release or to inquire as to the
existence of any conditions herein prescribed for the exercise of such
authority; nor shall any purchaser or grantee of any property or rights
permitted by this Indenture to be sold or otherwise disposed of by the Issuer be
under any obligation to ascertain or inquire into the authority of the Issuer to
make such sale or other disposition.
SECTION 10.07. Authorization of Actions To Be Taken by the Collateral Agent
Under the Collateral Agreements. Subject to the provisions of the applicable
Collateral Agreements, the Trustee and each Holder, by acceptance of its
Note(s), agrees that (a) the Collateral Agent shall execute and deliver the
Collateral Agreements and act in accordance with the terms thereof, (b) the
Collateral Agent may, in its sole discretion and without the consent of the
Holders or the Trustee, take all actions they deem necessary or appropriate in
order to (i) enforce any of the terms of the Collateral Agreements and (ii)
collect and receive any and all amounts payable in respect of the Obligations of
the Issuer hereunder or under any Collateral Agreement or Note, and (c) the
Collateral Agent shall have power to institute and to maintain such suits and
proceedings as it may deem expedient to prevent any impairment of the Collateral
by any act that may be unlawful or in violation of the Collateral Agreements or
this Indenture, and suits and proceedings as the Collateral Agent may deem
expedient to preserve or protect its interests and the interests of the Trustee
and the Holders in the Collateral (including the power to institute and maintain
suits or proceedings to restrain the enforcement of or compliance with any
legislative or other governmental enactment, rule or order that may be
unconstitutional or otherwise invalid if the enforcement of, or compliance with,
such enactment, rule or order would impair the security interest thereunder or
be prejudicial to the interests of the Holders, the Trustee or the Collateral
Agent). Notwithstanding the foregoing, the Collateral Agent may, at the expense
of the Issuer, request the direction of the Holders with respect to any such
actions and upon receipt of the written consent of the Holders of at least a
majority in aggregate principal amount of the outstanding Notes, shall take such
actions.
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SECTION 10.08. Authorization of Receipt of Funds by the Collateral Agent
Under the Collateral Agreements. The Collateral Agent is authorized to receive
any funds for the benefit of the Holders distributed under the Collateral
Agreements for turnover to the Trustee to make further distributions of such
funds to any Secured Party in accordance with the provisions of Section 6.10 and
the other provisions of this Indenture.
SECTION 10.09. Limitation on Duty of Collateral Agent in Respect of
Collateral; Indemnification. (a) Beyond the exercise of reasonable care in the
custody thereof, the Collateral Agent shall have no duty as to any Collateral in
its possession or control or in the possession or control of any agent or bailee
or any income thereon or as to preservation of rights against prior parties or
any other rights pertaining thereto and the Collateral Agent shall not be
responsible for filing any financing or continuation statements or recording any
documents or instruments in any public office at any time or times or otherwise
perfecting or maintaining the perfection of any security interest in the
Collateral. The Collateral Agent shall be deemed to have exercised reasonable
care in the custody of the Collateral in its possession if the Collateral is
accorded treatment substantially equal to that which it accords its own property
and shall not be liable or responsible for any loss or diminution in the value
of any of the Collateral, by reason of the act or omission of any carrier,
forwarding agency or other agent or bailee selected by the Collateral Agent in
good faith.
(b) The Collateral Agent shall not be responsible for the existence,
genuineness or value of any of the Collateral or for the validity, perfection,
priority or enforceability of the Liens in any of the Collateral, whether
impaired by operation of law or by reason of any action or omission to act on
its part hereunder, except to the extent such action or omission constitutes
gross negligence or willful misconduct on the part of the Collateral Agent, for
the validity or sufficiency of the Collateral or any agreement or assignment
contained therein, for the validity of the title of the Issuer to the
Collateral, for insuring the Collateral or for the payment of taxes, charges,
assessments or Liens upon the Collateral or otherwise as to the maintenance of
the Collateral. The Collateral Agent shall have no duty to ascertain or inquire
as to the performance or observance of any of the terms of this Indenture or any
Collateral Agreement.
SECTION 10.10. Rights of the Issuer. So long as no Event of Default has
occurred and is continuing, and subject to certain terms and conditions in this
Indenture and the Collateral Agreements, the Issuer shall be entitled to receive
all cash dividends, interest and other payments made upon or with respect to the
Capital Stock of any of its Subsidiaries held as Collateral and to exercise any
voting, consensual and other rights pertaining to such Capital Stock. Upon the
occurrence and during the continuance of an Event of Default, upon notice from
the Collateral Agent, (a) all of the Issuer's rights to exercise such voting,
consensual or other rights shall cease and all such rights shall become vested
in the Collateral Agent, which, to the extent permitted by law, shall have the
sole right to exercise such voting, consensual or other rights, (b) all of the
Issuer's rights to receive all cash dividends, interest and other payments made
upon or with respect to the Collateral shall cease, and such cash dividends,
interest and other payments shall be paid to the Collateral Agent, and (c) the
Collateral Agent may sell the Collateral or any part thereof in accordance with
the applicable Collateral Agreement. All funds distributed under the Collateral
Agreement by the Collateral Agent shall be distributed by the Collateral Agent
in accordance with Section 6.11 this Indenture.
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ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TIA Controls. If any provision of this Indenture limits,
qualifies, or conflicts with another provision which is required to be included
in this Indenture by the TIA, the required provision shall control; provided,
however, that this Section 11.01 shall not of itself require that this Indenture
or the Trustee be qualified under the TIA or constitute any admission or
acknowledgment by any party hereto that any such qualification is required prior
to the time this Indenture and the Trustee are required by the TIA to be so
qualified.
SECTION 11.02. Notices. Any notices or other communications required or
permitted hereunder shall be in writing, and shall be sufficiently given if made
by hand delivery, by telex, by telecopier or overnight courier guaranteeing
next-day delivery or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Issuer:
PAHC HOLDINGS CORPORATION
c/o Phibro Animal Health Corporation
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Chief Executive Officer
with a copy to:
Golenbock Xxxxxxx Xxxxx Xxxx & Xxxxxx LLP
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attn: Xxxxxxxx X. Xxxx, Esq.
if to the Trustee or Collateral Agent:
HSBC Bank USA, National Association
000 0xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: 000 000-0000
Attention: Issuer Services
The Issuer, the Trustee or the Collateral Agent by written notice to the
other may designate additional or different addresses for notices to such
Person. Any notice or communication to the Issuer, the Trustee or the Collateral
Agent shall be deemed to have been given or made as of the date so delivered if
hand delivered; when answered back, if telexed; when receipt is acknowledged, if
faxed; and five (5) calendar days after mailing if sent by registered or
certified mail, postage prepaid (except that (i) the Trustee shall not be deemed
to have knowledge of such notice nor shall any time period within which the
Trustee is required to act as a result of such notice commence until the Trustee
actually receives the notice in question and (ii) a notice of change of address
shall not be deemed to have been given until actually received by the
addressee).
69
Any notice or communication mailed to a Holder shall be mailed by first
class mail, certified or registered return receipt requested, or by overnight
courier guaranteeing next-day delivery to its address as it appears on the
registration books of the Registrar. Any notice or communication shall be mailed
to any Person as described in TIA ss. 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders. 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. Holders may
communicate pursuant to TIA ss. 312(b) with other Holders with respect to their
rights under this Indenture or the Notes. The Issuer, 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 Issuer to the Trustee to take any action under
this Indenture, the Issuer shall if the Trustee shall so request furnish to 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
to be performed by the Issuer, if any, provided for in this Indenture relating
to the proposed action have been complied with; and/or
(2) an Opinion of Counsel stating that, in the opinion of such counsel, all
such conditions precedent to be performed by the Issuer, if any, provided for in
this Indenture relating to the proposed action have been complied with (which
counsel, as to factual matters, may rely on an Officers' Certificate).
SECTION 11.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture, other than the Officers' Certificate required by
Section 4.06, 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 reasonably necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether or not, in the opinion of each such
Person, such condition or covenant has been complied with; provided,
however, that with respect to such matters of fact an Opinion of Counsel
may rely on an Officers' Certificate or certificate of public officials,
and provided, further, that an Opinion of Counsel may have qualifications
for opinions of the type required.
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar. The Trustee may
make reasonable rules in accordance with the Trustee's customary practices for
action by or at a meeting of Holders. The Paying Agent or Registrar may make
reasonable rules for its functions.
70
SECTION 11.07. Legal Holidays. A "Legal Holiday" used with respect to a
particular place of payment is a Saturday, a Sunday or a day on which banking
institutions in New York, New York or at such place of payment are not required
to be open. If a payment date is a Legal Holiday at such place, payment may be
made at such place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue for the intervening period.
SECTION 11.08. Governing Law. THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT
THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 11.09. No Adverse Interpretation of Other Agreements. Indenture may
not be used to interpret another indenture, loan or debt agreement of the Issuer
or any of its Subsidiaries. Any such indenture, loan or debt agreement may not
be used to interpret this Indenture.
SECTION 11.10. No Personal Liability. No recourse for the payment of the
principal of, premium, if any, interest on, if any, with respect to any of the
Notes or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Issuer in
this Indenture, the Registration Rights Agreement or in any of the Notes or
because of the creation of any Indebtedness represented thereby, shall be had
against any officer, employee, incorporator, direct or indirect controlling
person, shareholder, member, partner or Affiliate of the Issuer or of any
successor Person thereof. Each Holder, by accepting the Notes, and the
Collateral Agent and the Trustee, waive and release all such liability.
SECTION 11.11. Successors. All agreements of the Issuer in this Indenture
and the Notes shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.12. Duplicate Originals. All parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together shall represent the same agreement.
SECTION 11.13. Severability. In case any one or more of the provisions in
this Indenture or in the Notes shall be held invalid, illegal or unenforceable,
in any respect for any reason, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions shall not
in any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.
SECTION 11.14. Jurisdiction; Waiver of Jury Trial. EACH PARTY HERETO HEREBY
EXPRESSLY AND IRREVOCABLY (I) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE
FEDERAL AND STATE COURTS SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW
YORK IN ANY SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE; AND
(II) WAIVES (A) ITS RIGHT TO A TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS INDENTURE, AND (B) ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
SECTION 11.15. English Language. This Indenture has been negotiated and
executed in the English language. All certificates, reports, notices and other
documents and communications given or
71
delivered pursuant to this Indenture shall be in the English language, or
accompanied by a certified English translation thereof. Except in the case of
laws of, or official communications of, The Netherlands or Belgium, in the case
of any document originally issued in a language other than English, the English
language version of any such document shall for purposes of this Indenture and
absent manifest error, control the meaning of the matters set forth therein.
72
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
PAHC HOLDINGS CORPORATION
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxx X. Xxxxxxxx
Title President
Accepted and Agreed to:
HSBC BANK USA, NATIONAL ASSOCIATION,
as Trustee and Collateral Agent
By: /s/ Herawattee Alli
-------------------------------
Name: Herawattee Alli
Title: Assistant Vice President
EXHIBIT A
[FACE OF INITIAL NOTE]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER
THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF (1) REPRESENTS
THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT), (B) IT IS A NON-U.S. PURCHASER AND IS ACQUIRING THIS
SECURITY IN AN OFFSHORE TRANSACTION WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, OR (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE
MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT, AND (2) AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO
THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH PAHC
HOLDINGS CORPORATION OR ANY AFFILIATE OF PAHC HOLDINGS CORPORATION WAS THE OWNER
OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO PAHC
HOLDINGS CORPORATION OR ANY OF ITS SUBSIDIARIES, (B) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO OFFERS AND SALES TO
NON-U.S. PURCHASERS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT, (D) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a)(1), (2), (3) OR (7) OF RULE 501
UNDER THE SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR
FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, 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, (E) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, OR (F)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, SUBJECT TO PAHC HOLDINGS CORPORATION'S AND THE TRUSTEE'S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (C), (D) OR
(F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FORGOING CASES, A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY
IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE
REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE.
A-1
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, ITS NOMINEES AND THEIR
RESPECTIVE SUCCESSORS (THE "DEPOSITORY") TO A NOMINEE OF THE DEPOSITORY, OR BY
ANY SUCH NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH
SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TO AN ISSUER 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 DEPOSITORY (AND ANY PAYMENT HEREON IS MADE TO CEDE
& CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY), 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 NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.16 OF THE INDENTURE.
A-2
PAHC HOLDINGS CORPORATION
15% Senior Secured Notes due 2010
No. $
CUSIP No.
PAHC HOLDINGS CORPORATION, a Delaware corporation, promises to pay to
CEDE & CO., or registered assigns, the principal sum of [ ] DOLLARS on
February 1, 2010.
Interest Rate: 15%
Interest Payment Dates: February 1 and August 1, commencing August 1,
2005.
Record Dates: January 15 and July 15.
Additional provisions of this Note are set forth on the reverse side
of this Note.
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by one of its duly authorized officers.
PAHC HOLDINGS CORPORATION
By:
--------------------------------------
Name:
Title:
A-3
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
HSBC Bank USA, National Association, as Trustee, certifies that this
is one of the Notes referred to in the within-mentioned Indenture.
HSBC BANK USA, NATIONAL ASSOCIATION, as
Trustee
By:
-----------------------------------
Authorized Signatory
Date of Authentication: February 10, 2005
A-4
[REVERSE OF INITIAL NOTE]
15% SENIOR SECURED NOTE DUE 2010
1. Interest. PAHC HOLDINGS CORPORATION, a Delaware corporation (such
entity, and its successors and assigns under the Indenture hereinafter referred
to, and each other entity which is required to become the Company pursuant to
the Indenture, and its successors and assigns under the Indenture, being herein
called the "Company"), promises to pay interest on the principal amount of this
Note at the rate per annum shown above. The Company will pay interest
semi-annually on February 1 and August 1 of each year, commencing August 1,
2005. Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from February 10, 2005.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay, to the extent such payments are lawful, interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at 1% per annum in excess
of the rate borne by the Notes. The Company may, at its option, in lieu of
paying interest in cash on the Notes, pay interest on the Notes through the
issuance of PIK Notes in an aggregate principal amount equal to the amount of
interest (rounded to the nearest whole cent) that would be payable with respect
to the Notes if such interest were paid in cash; provided, however, that any
interest due and payable (i) on the Maturity Date or (ii) in connection with
redemptions or offers to purchase pursuant to Sections 3.03, 4.15 or 4.16 of the
Indenture (as defined below), in each case may only be paid by the Company in
cash. On each interest payment date on which the Company elects to pay interest
in the form of PIK Notes, the Trustee will, at the Company's request,
authenticate and deliver PIK Notes for original issuance to the holders of the
Notes on the relevant record date, as shown by the records of the Registrar, in
the aggregate principal amount required to pay such interest. Any PIK Notes so
issued will be dated the applicable interest payment date, will bear interest
from and after such date, will mature on February 1, 2010 and will be governed
by, and subject to the terms, provisions and conditions of, the Indenture (as
defined below) and will have the same rights and benefits as the Notes. Any PIK
Notes will be issued with the designation "PIK" on the face of such PIK Notes.
2. Method of Payment. The Company will pay interest on the Notes (except
defaulted interest) to the Persons who are registered Holders of Notes at the
close of business on the Record Date immediately preceding the Interest Payment
Date even if Notes are canceled on registration of transfer or registration of
exchange (including pursuant to an Exchange Offer (as defined in the
Registration Rights Agreement)) after the Record Date. Holders must surrender
Notes 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 ("U.S. Legal Tender").
However, the Company may pay principal and interest by its check payable in such
U.S. Legal Tender. The Company may deliver any such interest payment to the
Paying Agent or to a Holder's registered address.
3. Paying Agent and Registrar. Initially, HSBC Bank USA, National
Association, a New York banking corporation ("Trustee"), will act as Paying
Agent and Registrar. The Company may appoint and change any Paying Agent,
Registrar or co-Registrar without notice.
A-5
The Company and any of its Subsidiaries may act as Paying Agent, Registrar,
co-Registrar or transfer agent.
4. Indenture. The Company issued the Notes under an Indenture dated as of
February 10, 2005 (the "Indenture"), among the Company, the Trustee and the
Collateral Agent. This Note is one of a duly authorized issue of Initial Notes
of the Company designated as its 15% Senior Secured Notes due 2010 (the "Initial
Notes"). The Notes include the Initial Notes, the PIK Notes, if any, and the
Exchange Notes issued in exchange for the Initial Notes and the PIK Notes, if
any, pursuant to the Registration Rights Agreement. The Initial Notes, the
Exchange Notes and the PIK Notes are treated as a single class of securities
under the Indenture. The terms of the Notes 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. Section 77aaa-77bbbb) as in effect and amended,
on the date of the Indenture (the "TIA"). Terms defined in the Indenture and not
defined herein have the meanings ascribed thereto in the Indenture. The Notes
are subject to all such terms, and Holders are referred to the Indenture and the
TIA for a statement of those terms. Any conflict between this Note and the
Indenture will be governed by the Indenture.
5. Mandatory Redemption.
(a) Mandatory Redemption due to Operating Company Refinancing Event.
If an Operating Company Refinancing Event shall occur, the Company will be
required to redeem all of the Notes on a date (the "Mandatory Redemption Date")
that is not later than the 60th day following the date of such occurrence at the
redemption price (expressed as a percentage of the aggregate principal amount of
the Notes) then applicable for optional redemptions on the Mandatory Redemption
Date as set forth under Section 6(b) below, plus accrued and unpaid interest to
the Mandatory Redemption Date; provided, that if the Mandatory Redemption Date
is prior to June 1, 2005, the then applicable redemption price shall be deemed
to be 115.0%.
(b) Mandatory Redemption due to the Failure to Escrow Release
Conditions. In the event that the Trustee has not received prior to 10:00 a.m.
(New York City time) on March 1, 2005 an Officers' Certificate from the Company
certifying that (1) it has satisfied the conditions under either clause (a)(i)
or (ii) of Section 1.3 of the Escrow Agreement and (2) it has made a demand on
the Escrow Agent pursuant to clause (a) of Section 1.3 of the Escrow Agreement
for the release of the funds from the Escrow Account, the Trustee shall give
written notice to the Escrow Agent pursuant to clause (b) of Section 1.3 of the
Escrow Agreement that a special redemption of the Notes will be made on March 1,
2005. The Trustee shall direct the Paying Agent to redeem the Notes at 100% of
their aggregate principal amount plus accrued and unpaid interest to such date
upon receipt of proceeds from the Escrow Account pursuant to clause (b) of
Section 1.3 of the Escrow Agreement.
6. Optional Redemption.
(a) No Optional Redemption Prior to June 1, 2005. The Notes are not
redeemable at the option of the Company, in whole or in part, at any time prior
to June 1, 2005.
(b) Optional Redemption On or After June 1, 2005. The Notes are
redeemable at the option of the Company, in whole or in part, at any time on or
after June 1,
A-6
2005 at the redemption prices (expressed as percentages of the
principal amount of the Notes) set forth below plus in each case accrued and
unpaid interest and Additional Interest, if any, to the date of redemption, if
redeemed during the periods beginning on the dates indicated below:
Period Percentage
------ ----------
June 1, 2005...................... 115.0%
February 1, 2007.................. 110.0%
February 1, 2008.................. 105.0%
February 1, 2009 and thereafter... 100.0%
7. Notice of Redemption. Notice of redemption will be mailed at least 30
but not more than 60 days before the Redemption Date to each Holder of Notes to
be redeemed at its registered address. Notes in denominations larger than $1,000
may be redeemed in part.
Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then, unless the Company defaults in the
payment of such Redemption Price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the Redemption Price plus accrued interest, if any.
Unless the Company fails to comply with the preceding paragraph and
defaults in the payment of such Redemption Price plus accrued interest, if any,
interest on the Notes to be redeemed will cease to accrue on and after the
applicable Redemption Date, whether or not such Notes are presented for payment.
8. Offers to Purchase. Sections 4.15 and 4.16 of the Indenture provide that
upon the occurrence of a Change of Control of the Company and after certain
Asset Sales, and subject to further limitations contained therein, the Company
will make an offer to purchase certain amounts of the Notes in accordance with
the procedures set forth in the Indenture.
9. The Registration Rights Agreement. Pursuant to the Registration Rights
Agreement between the Company and the Initial Purchaser named therein, the
Company has made certain covenants as set forth therein with respect to
consummation of an Exchange Offer (as defined in the Registration Rights
Agreement). Upon such exchange offering, the Holders of Notes shall have the
right, subject to compliance with securities laws, to exchange such Notes for
15% Senior Secured Notes due 2010, which have been registered under the
Securities Act (the "Exchange Notes"), identical in all material respects to the
Notes, except for restrictive legends and additional interest provisions. The
Holders of the Initial Notes shall be entitled to receive certain Additional
Interest in the event such exchange offer is not consummated and upon certain
other conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement.
10. Denominations. The Notes are in registered form, without coupons, and
in denominations of $1,000 and integral multiples thereof.
A-7
11. Persons Deemed Owners. The registered Holder of this Note may be
treated as the owner of it for all purposes.
12. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for one year, the Trustee or Paying Agent shall pay the money
back to the Company at its written 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.
13. Discharge and Defeasance. Subject to certain conditions, the Company at
any time may terminate some or all of its obligations under the Notes 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 Notes to redemption
or maturity, as the case may be.
14. Amendment, Waiver. Subject to Section 6.07 of the Indenture, the
Company, when authorized by a Board Resolution, and the Trustee, together, with
the written consent of the Holder or Holders of at least a majority in aggregate
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for the Notes), may amend or
supplement the Indenture or the Notes without notice to any other Holder.
Subject to Section 6.02 and 6.07 of the Indenture, the Holder or Holders of not
less than a majority in aggregate principal amount of the then outstanding Notes
may waive compliance by the Company with any provision of the Indenture or the
Notes without notice to any other Holder. Subject to certain exceptions set
forth in the Indenture, the Company, when authorized by a Board Resolution, and
the Trustee, together, may amend or supplement the Indenture or the Notes
without notice to or consent of any Holder in order to cure any ambiguity,
defect or inconsistency, provide for uncertificated Notes in addition to or in
place of certificated Notes; provide for the assumption of the Company's
Obligations to Holders in the event of any Disposition involving the Company in
which the Company is not the Surviving Person, make any change that would
provide any additional rights or benefits to the Holders or that does not
adversely affect the rights of any such Holder; or comply with the requirements
of the Commission in order to effect or maintain the qualification of this
Indenture under the Trust Indenture Act.
15. Trustee Dealings with the Company. Subject to certain limitations
imposed by the TIA, the Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Notes and may otherwise deal
with and collect obligations owed to it by the Company or any of its Affiliates
and may otherwise deal with the Company or any of its Affiliates with the same
rights it would have if it were not Trustee.
16. No Recourse Against Others. No recourse for the payment of the
principal of, premium, if any, interest on, if any, with respect to any of the
Notes or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indenture, the Registration Rights Agreement or in any of the Notes or
because of the creation of any Indebtedness represented thereby, shall be had
against any officer, employee, incorporator, direct or indirect controlling
person, shareholder, member, partner or Affiliate of the Company or of any
successor Person thereof. Each Holder, by accepting the Notes, waives and
releases all such liability.
A-8
17. Governing Law. THE INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
18. Waiver of Jury Trial. EACH OF THE PARTIES HERETO AND THE HOLDERS (BY
THEIR ACCEPTANCE OF A NOTE) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR IN CONNECTION WITH THE INDENTURE, THIS NOTE, THE COLLATERAL
AGREEMENTS OR THE TRANSACTIONS CONTEMPLATED BY THE INDENTURE.
19. Authentication. This Note 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 Note.
20. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants
by the entireties), JT TEN (= joint tenants with rights of survivorship and not
as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
21. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes as a convenience to the Holders of the
Notes. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge to the Holder a copy of the Indenture. Requests may be made to:
PAHC Holdings Corporation, c/o Phibro Animal Health Corporation, 00 Xxxxxxxxxx
Xxxx, Xxxxxxxxxx Xxxx, XX 00000, Tel: (000) 000-0000, Attention: Corporate Legal
Department.
A-9
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and
have your signature guaranteed:
I or we assign and transfer this Note to:
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint
________________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Dated: __________________________ Signed:
------------------------------
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee:
-----------------
A-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.15 and 4.16 of the Indenture, check the box: [ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.15 or 4.16 of the Indenture, state the amount:
$______________
Date: ___________________________ Your Signature:
----------------------
(Sign exactly as your
name appears on the
other side of the
Note)
Signature Guarantee:
-----------------
(Signature must
be guaranteed)
A-11
EXHIBIT B
[FACE OF EXCHANGE NOTE]
PAHC HOLDINGS CORPORATION
15% Senior Secured Notes due 2010
No. $
CUSIP No.
PAHC HOLDINGS CORPORATION, a Delaware corporation, promises to pay to
CEDE & CO., or registered assigns, the principal sum of [ ]
DOLLARS on February 1, 2010.
Interest Rate: 15%
Interest Payment Dates: February 1 and August 1, commencing August 1,
2005.
Record Dates: January 15 and July 15.
Additional provisions of this Note are set forth on the reverse side
of this Note.
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by one of its duly authorized officers.
PAHC HOLDINGS CORPORATION
By:
----------------------------------
Name:
Title:
B-1
TRUSTEE'S CERTIFICATE
OF AUTHENTICATION
The HSBC Bank USA, National Association, as Trustee, certifies that
this is one of the Notes referred to in the within-mentioned Indenture.
HSBC BANK USA, NATIONAL ASSOCIATION,
as Trustee
By:
----------------------------------
Authorized Signatory
Date of Authentication: February 10, 2005
B-2
[REVERSE OF EXCHANGE NOTE]
15% SENIOR SECURED NOTE DUE 2010
1. Interest. PAHC HOLDINGS CORPORATION, a Delaware corporation (such
entity, and its successors and assigns under the Indenture hereinafter referred
to, and each other entity which is required to become the Company pursuant to
the Indenture, and its successors and assigns under the Indenture, being herein
called the "Company"), promises to pay interest on the principal amount of this
Note at the rate per annum shown above. The Company will pay interest
semi-annually on February 1 and August 1 of each year, commencing August 1,
2005. Interest on the Notes will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from February 10, 2005.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay, to the extent such payments are lawful, interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at 1% per annum in excess
of the rate borne by the Notes. The Company may, at its option, in lieu of
paying interest in cash on the Notes, pay interest on the Notes through the
issuance of PIK Notes in an aggregate principal amount equal to the amount of
interest (rounded to the nearest whole cent) that would be payable with respect
to the Notes if such interest were paid in cash; provided, however, that any
interest due and payable (i) on the Maturity Date or (ii) in connection with
redemptions or offers to purchase pursuant to Sections 3.03, 4.15 or 4.16 of the
Indenture (as defined below), in each case may only be paid by the Company in
cash. On each interest payment date on which the Company elects to pay interest
in the form of PIK Notes, the Trustee will, at the Company's request,
authenticate and deliver PIK Notes for original issuance to the holders of the
Notes on the relevant record date, as shown by the records of the Registrar, in
the aggregate principal amount required to pay such interest. Any PIK Notes so
issued will be dated the applicable interest payment date, will bear interest
from and after such date, will mature on February 1, 2010 and will be governed
by, and subject to the terms, provisions and conditions of, the Indenture (as
defined below) and will have the same rights and benefits as the Notes. Any PIK
Notes will be issued with the designation "PIK" on the face of such PIK Notes.
2. Method of Payment. The Company will pay interest on the Notes (except
defaulted interest) to the Persons who are registered Holders of Notes at the
close of business on the Record Date immediately preceding the Interest Payment
Date even if Notes are canceled on registration of transfer or registration of
exchange (including pursuant to an Exchange Offer (as defined in the
Registration Rights Agreement)) after the Record Date. Holders must surrender
Notes 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 ("U.S. Legal Tender").
However, the Company may pay principal and interest by its check payable in such
U.S. Legal Tender. The Company may deliver any such interest payment to the
Paying Agent or to a Holder's registered address.
3. Paying Agent and Registrar. Initially, HSBC Bank USA, National
Association, a New York banking corporation ("Trustee"), will act as Paying
Agent and Registrar. The Company may appoint and change any Paying Agent,
Registrar or co-Registrar without notice.
B-3
The Company and any of its Subsidiaries may act as Paying Agent, Registrar,
co-Registrar or transfer agent.
4. Indenture. The Company issued the Notes under an Indenture dated as of
February 10, 2005 (the "Indenture"), among the Company, the Trustee and the
Collateral Agent. This Note is one of a duly authorized issue of Initial Notes
of the Company designated as its 15% Senior Secured Notes due 2010 (the "Initial
Notes"). The Notes include the Initial Notes, the PIK Notes, if any, and the
Exchange Notes issued in exchange for the Initial Notes and the PIK Notes, if
any, pursuant to the Registration Rights Agreement. The Initial Notes, the
Exchange Notes and the PIK Notes are treated as a single class of securities
under the Indenture. The terms of the Notes 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. Section 77aaa-77bbbb) as in effect and amended,
on the date of the Indenture (the "TIA"). Terms defined in the Indenture and not
defined herein have the meanings ascribed thereto in the Indenture. The Notes
are subject to all such terms, and Holders are referred to the Indenture and the
TIA for a statement of those terms. Any conflict between this Note and the
Indenture will be governed by the Indenture.
5. Mandatory Redemption.
(a) Mandatory Redemption due to Operating Company Refinancing Event.
If an Operating Company Refinancing Event shall occur, the Company will be
required to redeem all of the Notes on a date (the "Mandatory Redemption Date")
that is not later than the 60th day following the date of such occurrence at the
redemption price (expressed as a percentage of the aggregate principal amount of
the Notes) then applicable for optional redemptions on the Mandatory Redemption
Date as set forth under Section 6(b) below, plus accrued and unpaid interest to
the Mandatory Redemption Date; provided, that if the Mandatory Redemption Date
is prior to June 1, 2005, the then applicable redemption price shall be deemed
to be 115.0%.
(b) Mandatory Redemption due to the Failure to Escrow Release
Conditions. In the event that the Trustee has not received prior to 10:00 a.m.
(New York City time) on March 1, 2005 an Officers' Certificate from the Company
certifying that (1) it has satisfied the conditions under either clause (a)(i)
or (ii) of Section 1.3 of the Escrow Agreement and (2) it has made a demand on
the Escrow Agent pursuant to clause (a) of Section 1.3 of the Escrow Agreement
for the release of the funds from the Escrow Account, the Trustee shall give
written notice to the Escrow Agent pursuant to clause (b) of Section 1.3 of the
Escrow Agreement that a special redemption of the Notes will be made on March 1,
2005. The Trustee shall direct the Paying Agent to redeem the Notes at 100% of
their aggregate principal amount plus accrued and unpaid interest to such date
upon receipt of proceeds from the Escrow Account pursuant to clause (b) of
Section 1.3 of the Escrow Agreement.
6. Optional Redemption.
(a) No Optional Redemption Prior to June 1, 2005. The Notes are not
redeemable at the option of the Company, in whole or in part, at any time prior
to June 1, 2005.
(b) Optional Redemption On or After June 1, 2005. The Notes are
redeemable at the option of the Company, in whole or in part, at any time on or
after June 1,
B-4
2005 at the redemption prices (expressed as percentages of the principal amount
of the Notes) set forth below plus in each case accrued and unpaid interest and
Additional Interest, if any, to the date of redemption, if redeemed during the
periods beginning on the dates indicated below:
Period Percentage
------ ----------
June 1, 2005...................... 115.0%
February 1, 2007.................. 110.0%
February 1, 2008.................. 105.0%
February 1, 2009 and thereafter... 100.0%
7. Notice of Redemption. Notice of redemption will be mailed at least 30
but not more than 60 days before the Redemption Date to each Holder of Notes to
be redeemed at its registered address. Notes in denominations larger than $1,000
may be redeemed in part.
Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then, unless the Company defaults in the
payment of such Redemption Price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the Redemption Price plus accrued interest, if any.
Unless the Company fails to comply with the preceding paragraph and
defaults in the payment of such Redemption Price plus accrued interest, if any,
interest on the Notes to be redeemed will cease to accrue on and after the
applicable Redemption Date, whether or not such Notes are presented for payment.
8. Offers to Purchase. Sections 4.15 and 4.16 of the Indenture provide that
upon the occurrence of a Change of Control of the Company and after certain
Asset Sales, and subject to further limitations contained therein, the Company
will make an offer to purchase certain amounts of the Notes in accordance with
the procedures set forth in the Indenture.
9. Denominations. The Notes are in registered form, without coupons, and in
denominations of $1,000 and integral multiples thereof.
10. Persons Deemed Owners. The registered Holder of this Note 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 one year, the Trustee or Paying Agent shall pay the money
back to the Company at its written 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 may terminate some or all of its obligations under the Notes 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 Notes to redemption
or maturity, as the case may be.
X-0
00. Xxxxxxxxx, Xxxxxx. Subject to Section 6.07 of the Indenture, the
Company, when authorized by a Board Resolution, and the Trustee, together, with
the written consent of the Holder or Holders of at least a majority in aggregate
principal amount of the then outstanding Notes (including consents obtained in
connection with a tender offer or exchange offer for the Notes), may amend or
supplement the Indenture or the Notes without notice to any other Holder.
Subject to Section 6.02 and 6.07 of the Indenture, the Holder or Holders of not
less than a majority in aggregate principal amount of the then outstanding Notes
may waive compliance by the Company with any provision of the Indenture or the
Notes without notice to any other Holder. Subject to certain exceptions set
forth in the Indenture, the Company, when authorized by a Board Resolution, and
the Trustee, together, may amend or supplement the Indenture or the Notes
without notice to or consent of any Holder in order to cure any ambiguity,
defect or inconsistency, provide for uncertificated Notes in addition to or in
place of certificated Notes; provide for the assumption of the Company's
Obligations to Holders in the event of any Disposition involving the Company in
which the Company is not the Surviving Person, make any change that would
provide any additional rights or benefits to the Holders or that does not
adversely affect the rights of any such Holder; or comply with the requirements
of the Commission in order to effect or maintain the qualification of this
Indenture under the Trust Indenture Act.
14. Trustee Dealings with the Company. Subject to certain limitations
imposed by the TIA, the Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Notes and may otherwise deal
with and collect obligations owed to it by the Company or any of its Affiliates
and may otherwise deal with the Company or any of its Affiliates with the same
rights it would have if it were not Trustee.
15. No Recourse Against Others. No recourse for the payment of the
principal of, premium, if any, interest on, if any, with respect to any of the
Notes or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
the Indenture, the Registration Rights Agreement or in any of the Notes or
because of the creation of any Indebtedness represented thereby, shall be had
against any officer, employee, incorporator, direct or indirect controlling
person, shareholder, member, partner or Affiliate of the Company or of any
successor Person thereof. Each Holder, by accepting the Notes, waives and
releases all such liability.
16. Governing Law. THE INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICT OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
17. Waiver of Jury Trial. EACH OF THE PARTIES HERETO AND THE HOLDERS (BY
THEIR ACCEPTANCE OF A NOTE) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR IN CONNECTION WITH THE INDENTURE, THIS NOTE, THE COLLATERAL
AGREEMENTS OR THE TRANSACTIONS CONTEMPLATED BY THE INDENTURE.
B-6
18. Authentication. This Note 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 Note.
19. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants
by the entireties), JT TEN (= joint tenants with rights of survivorship and not
as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
20. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes as a convenience to the Holders of the
Notes. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder upon written request and
without charge to the Holder a copy of the Indenture. Requests may be made to:
PAHC Holdings Corporation, c/o Phibro Animal Health Corporation, 00 Xxxxxxxxxx
Xxxx, Xxxxxxxxxx Xxxx, XX 00000, Tel: (000) 000-0000, Attention: Corporate Legal
Department.
B-7
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and
have your signature guaranteed:
I or we assign and transfer this Note to:
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint ________________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Dated: Signed:
-------------- ----------------------------
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee:
--------------------
B-8
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.15 and 4.16 of the Indenture, check the box: [ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.15 or 4.16 of the Indenture, state the amount:
$______________
Date: Your Signature:
---------------- ------------------------------------
(Sign exactly as your name appears
on the other side of the Note)
Signature Guarantee:
-------------------------------
(Signature must be guaranteed)
B-9
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
[________], [___]
[___________________________]
[___________________________]
[___________________________]
Re: PAHC Holdings Corporation
Ladies and Gentlemen:
In connection with our proposed purchase of 15% Senior Secured Notes
due 2010 (the "Notes") issued by PAHC Holdings Corporation (the "Company"), we
confirm that:
(i) We have received a copy of the Offering Circular (the
"Offering Circular"), dated as of February 7, 2005, relating to the Notes and
such other information as we deem necessary in order to make our investment
decision. We acknowledge that we have read and agreed to the matters stated in
the section entitled "Notice to Investors" of such Offering Circular.
(ii) We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Notes (the "Indenture") as described in the Offering Circular
and the undersigned agrees to be bound by, and not to resell, pledge or
otherwise transfer the Notes except in compliance with such restrictions and
conditions and the Securities Act of 1933, as amended (the "Securities Act"),
and all applicable state securities laws.
(iii) We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes may not be offered
or sold within the United States or to, or for the account or benefit of, U.S.
persons except as permitted in the following sentence. We agree, on our own
behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell any Notes, we will do so only (i) to the Company
or any subsidiary thereof, (ii) inside the United States in accordance with Rule
144A under the Securities Act to a "qualified institutional buyer" (as defined
in Rule 144A promulgated under the Securities Act), (iii) inside the United
States to an institutional "accredited investor" (as defined below) that, prior
to such transfer, furnishes (or has furnished on its behalf by a U.S.
broker-dealer) to the Trustee (as defined in the Indenture) a signed letter
containing certain representations and agreements relating to the restrictions
on transfer of the Notes (the form of which letter can be obtained from the
Trustee), (iv) outside the United States in accordance with Rule 904 of
Regulation S promulgated under the Securities Act to non-U.S. persons, (v)
pursuant to the exemption from registration provided by Rule 144 under the
Securities Act (if available), or (vi) pursuant to an effective registration
statement under the
C-1
Securities Act, and we further agree to provide to any person purchasing any of
the Securities from us a notice advising such purchaser that resales of the
Notes are restricted as stated herein.
(iv) We understand that, on any proposed resale of any Notes, we
will be required to furnish to the Trustee and the Company such certification,
legal opinions and other information as the Trustee and the Company may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will bear a
legend to the foregoing effect.
(v) We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or their investment, as the case may be.
(vi) We are acquiring the Notes purchased by us for our account
or for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
You, the Company, the Trustee and others are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferor]
By:
------------------------------------
Name:
Title:
C-2
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
[________], [___]
[___________________________]
[___________________________]
[___________________________]
Re: PAHC Holdings Corporation (the "Company")
Ladies and Gentlemen:
In connection with our proposed sale of $__________ aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
1. the offer of the Notes was not made to a person in the United
States;
(a) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United States, or
(b) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither we nor any person acting on
our behalf knows that the transaction has been prearranged with a buyer in the
United States;
(b) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;
(c) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(d) we have advised the transferee of the transfer restrictions
applicable to the Notes.
D-1
You, the Company and counsel for the Company are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
------------------------------------
Authorized Signature
D-2
EXHIBIT E
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF SECURITIES
Re: 15% Senior Secured Notes due 2010 of PAHC Holdings Corporation
This Certificate relates to $________ principal amount of Notes held in the
form of *_________ a beneficial interest in a Global Note or *_________ Physical
Note by ___________ (the "Transferor").
The Transferor:*
[ ] has requested by written order that the Registrar deliver in exchange
for its beneficial interest in the Global Note held by the Depository a Physical
Note or Physical Notes in definitive, registered form of authorized
denominations and an aggregate number equal to its beneficial interest in such
Global Note (or the portion thereof indicated above); or
[ ] has requested by written order that the Registrar exchange or register
the transfer of a Physical Note or Physical Notes.
In connection with such request and in respect of each such Note, the
Transferor does hereby certify that the Transferor is familiar with the
Indenture relating to the above-captioned Notes and the restrictions on
transfers thereof as provided in Section 2.17 of such Indenture, and that the
transfer of this Note does not require registration under the Securities Act of
1933, as amended (the "Act"), because*:
[ ] Such Note is being acquired for the Transferor's own account, without
transfer (in satisfaction of Section 2.17(a)(ii)(1) or Section 2.17(d)(i)(1) of
the Indenture).
[ ] Such Note is being transferred to a "qualified institutional buyer" (as
defined in Rule 144A under the Act), in reliance on Rule 144A.
[ ] Such Note is being transferred to an institutional "accredited
investor" (within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule
501 under the Act).
[ ] Such Note is being transferred in reliance on Regulation S under the
Act.
[ ] Such Note is being transferred in reliance on Rule 144 under the Act.
----------
* Check applicable box.
E-1
[ ] Such Note is being transferred in reliance on and in compliance with an
exemption from the registration requirements of the Act other than Rule 144A or
Rule 144 or Regulation S under the Act to a person other than an institutional
"accredited investor."
----------------------------------------
[INSERT NAME OF TRANSFEROR]
By:
------------------------------------
[Authorized Signatory]
Date:
-------------------
E-2
