LW DRAFT 6/17/97
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XXXXXXX SPORTS INC.
as Issuer
The Parties Listed
on Sechedule I hereto
as Guarantors
10 1/2% SENIOR NOTES DUE 2007
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INDENTURE
Dated as of June 19, 1997
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MARINE MIDLAND BANK
as Trustee
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310 (a)(1)............................................... 7.10
(a)(2).............................................. 7.10
(a)(3) ............................................. N.A.
(a)(4).............................................. N.A.
(a)(5).............................................. 7.10
(b) ................................................ 7.10
(c) ................................................ N.A.
311 (a) ................................................. 7.11
(b) ................................................ 7.11
(c) ................................................ N.A.
312 (a).................................................. 2.05
(b)................................................. 11.03
(c) ................................................ 11.03
313 (a) ................................................. 7.06
(b)(2) ............................................. 7.07
(c) ................................................ 7.06;11.02
(d)................................................. 7.06
314 (a) ................................................. 4.03;11.02
(c)(1) ............................................. 11.04
(c)(2) ............................................. 11.04
(c)(3) ............................................. N.A.
(e) ............................................... 11.05
(f)................................................. N.A.
315 (a).................................................. 7.01
(b)................................................. 7.05,11.02
(c) ............................................... 7.01
(d)................................................. 7.01
(e)................................................. 6.11
316 (a)(last sentence) .................................. 2.09
(a)(1)(A)........................................... 6.05
(a)(1)(B) .......................................... 6.04
(a)(2) ............................................. N.A.
(b) ................................................ 6.07
(c) ................................................ 2.12
317 (a)(1) .............................................. 6.08
(a)(2).............................................. 6.09
(b) ................................................ 2.04
318 (a).................................................. 11.01
(b)................................................. N.A.
(c)................................................. 11.01
N.A. means not applicable.
*This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.........................................1
Section 1.02. Other Definitions..................................15
Section 1.03 Incorporation by Reference of Trust
Indenture Act....................................15
Section 1.04. Rules of Construction..............................16
ARTICLE 2 THE NOTES
Section 2.01. Form and Dating....................................16
Section 2.02. Execution and Authentication.......................17
Section 2.03. Registrar and Paying Agent.........................17
Section 2.04. Paying Agent to Hold Money in Trust................18
Section 2.05. Holder Lists.......................................18
Section 2.06. Transfer and Exchange..............................18
Section 2.07. Replacement Senior Notes...........................29
Section 2.08. Outstanding Senior Notes...........................29
Section 2.09. Treasury Senior Notes..............................30
Section 2.10. Temporary Senior Notes.............................30
Section 2.11. Cancellation.......................................30
Section 2.12. Defaulted Interest.................................30
ARTICLE 3 REDEMPTION AND PREPAYMENT
Section 3.01. Notices to Trustee.................................31
Section 3.02. Selection of Senior Notes to Be Redeemed...........31
Section 3.03. Notice of Redemption...............................31
Section 3.04. Effect of Notice of Redemption.....................32
Section 3.05. Deposit of Redemption Price........................32
Section 3.06. Senior Notes Redeemed in Part......................32
Section 3.07. Optional Redemption................................32
Section 3.08. Mandatory Redemption...............................33
Section 3.09. Offer to Purchase by Application of Excess
Proceeds.........................................33
ARTICLE 4 COVENANTS
Section 4.01. Payment of Senior Notes............................35
Section 4.02. Maintenance of Office or Agency....................35
Section 4.03. Reports............................................36
Section 4.04. Compliance Certificate.............................36
Section 4.05. Taxes..............................................37
Section 4.06. Stay, Extension and Usury Laws.....................37
Section 4.07. Restricted Payments................................37
Section 4.08. Dividend and Other Payment Restrictions
Affecting Subsidiaries...........................40
Section 4.09. Incurrence of Indebtedness and Issuance
of Preferred Stock...............................41
Section 4.10. Asset Sales........................................43
Section 4.11. Transactions with Affiliates.......................43
Section 4.12. Liens..............................................44
Section 4.13. Line of Business...................................44
Section 4.14. Corporate Existence................................44
Section 4.15. Offer to Repurchase Upon Change of Control.........45
Section 4.16. No Senior Subordinated Debt........................45
Section 4.17. Limitation on Issuances and Sales of Capital
Stock of Wholly Owned Restricted Subsidiaries....46
Section 4.18. Additional Subsidiary Guarantees...................46
Section 4.19. Payments for Consent...............................46
ARTICLE 5 SUCCESSORS
Section 5.01. Merger, Consolidation, or Sale of Assets...........46
Section 5.02. Successor Corporation Substituted..................46
ARTICLE 6 DEFAULTS AND REMEDIES
Section 6.01. Events of Default..................................47
Section 6.02. Acceleration.......................................49
Section 6.03. Other Remedies.....................................49
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. Rights of Holders of Senior Notes
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
ARTICLE 7 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 Defaults.................................54
Section 7.06. Reports by Trustee to Holders of the
Senior Notes.....................................54
Section 7.07. Compensation and Indemnity.........................55
Section 7.08. Replacement of Trustee.............................55
Section 7.09. Successor Trustee by Merger, etc...................56
Section 7.10. Eligibility; Disqualification......................56
Section 7.11. Preferential Collection of Claims
Against Company..................................57
ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Option to Effect Legal Defeasance
or Covenant Defeasance...........................57
Section 8.02. Legal Defeasance and Discharge.....................57
Section 8.03. Covenant Defeasance................................57
Section 8.04. Conditions to Legal or Covenant Defeasance.........58
Section 8.05. Deposited Money and Government
Securities to be Held in Trust; Other
Miscellaneous Provisions.........................59
Section 8.06. Repayment to Company...............................60
Section 8.07. Reinstatement......................................60
ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Senior Notes.........60
Section 9.02. With Consent of Holders of Senior Notes............61
Section 9.03. Compliance with Trust Indenture Act................62
Section 9.04. Revocation and Effect of Consents..................63
Section 9.05. Notation on or Exchange of Senior Notes............63
Section 9.06. Trustee to Sign Amendments, etc....................63
ARTICLE 10 SUBSIDIARY GUARANTEES
Section 10.01. Subsidiary Guarantees..............................63
Section 10.03. Execution and Delivery of Subsidiary Guarantee.....64
Section 10.04. Guarantors May Consolidate, etc., on Certain Terms.65
Section 10.05. Releases Following Sale of Assets..................66
Section 10.06. "Trustee" to Include Paying Agent..................66
ARTICLE 11 MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.......................66
Section 11.02. Notices............................................66
Section 11.03. Communication by Holders of Senior Notes
with Other Holders of Senior Notes...............68
Section 11.04. Certificate and Opinion as to
Conditions Precedent.............................68
Section 11.05. Statements Required in Certificate or Opinion......68
Section 11.06. Rules by Trustee and Agents........................68
Section 11.07. No Personal Liability of Directors,
Officers, Employees and Stockholders.............69
Section 11.08. Governing Law......................................69
Section 11.09. No Adverse Interpretation of Other Agreements......69
Section 11.10. Successors.........................................69
Section 11.11. Severability.......................................69
Section 11.12. Counterpart Originals..............................69
Section 11.13. Table of Contents, Headings, etc...................69
EXHIBITS
Exhibit A FORM OF NOTE
Exhibit B FORM OF CERTIFICATE OF TRANSFER
Exhibit C FORM OF CERTIFICATE OF EXCHANGE
Exhibit D FORM OF CERTIFICATE OF ACQUIRING
INSTITUTIONAL ACCREDITED INVESTOR
Exhibit E FORM OF NOTATION OF SUBSIDIARY GUARANTEE
Exhibit F FORM OF SUPPLEMENTAL INDENTURE
INDENTURE dated as of June 19, 1997 between Xxxxxxx Sports Inc.,
a Delaware corporation (the "Company"), each domestic subsidiary of the
Company, listed on Schedule I attached hereto, as Guarantors (the
"Guarantors"), and Marine Midland Bank, as trustee (the "Trustee").
The Company, the Guarantors and the Trustee agree as follows for
the benefit of each other and for the equal and ratable benefit of the
Holders of the 10 1/2% Senior Notes due 2007.
ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01. DEFINITIONS.
"144A Global Note" means a global Senior Note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of
the Depositary or its nominee that will be issued in a denomination equal
to the outstanding principal amount of the Senior Notes sold in reliance on
Rule 144A.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person,
including, without limitation, Indebtedness incurred in connection with, or
in contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person, and (ii) Indebtedness secured by a
Lien encumbering any asset acquired by such specified Person.
"Additional Senior Notes" means up to $25 million aggregate
principal amount of Senior Notes (other than the Initial Senior Notes)
issued under this Indenture in accordance with Sections 2.02 and 4.09
hereof, as part of the same series as the Initial Senior Notes.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise; provided that beneficial ownership
of 10% or more of the voting securities of a Person shall be deemed to be
control.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Cedel that apply to such
transfer or exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation, by way
of a sale and leaseback) other than sales of inventory or other current
assets in the ordinary course of business consistent with past practices
(provided that transactions governed by Section 4.15 and/or Section 5.01
shall be governed by such provisions and not by Section 4.10), and (ii) the
issue or sale by the Company or any of its Subsidiaries of Equity Interests
of any of the Company's Subsidiaries, in the case of either clause (i) or
(ii), whether in a single transaction or a series of related transactions
that have a fair market value (as determined in good faith by the Board of
Directors) in excess of $1.0 million. Notwithstanding the foregoing: (i) a
transfer of assets by the Company to a Guarantor or by a Guarantor to the
Company or to another Guarantor, (ii) an issuance of Equity Interests by a
Guarantor to the Company or to another Guarantor, (iii) a dividend,
distribution, Restricted Payment or Investment that is permitted by Section
4.07 and (iv) the transfer of any royalty payment by the Company or any
Subsidiary as contemplated by the MOU, and as modified by the terms of any
definitive settlement agreement negotiated thereunder (provided that the
aggregate payouts made pursuant to the definitive settlement agreement are
not materially more expensive to the Company than the terms of the MOU),
shall not be deemed to be Asset Sales.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal
or state law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company,
or any authorized committee of the Board of Directors.
"Borrowing Base" means as of any date, an amount equal to the sum
of (a) 85% of the face amount of all accounts receivable owned by the
Company and its Restricted Subsidiaries as of such date that are not more
than 90 days past due, and (b) 60% of the book value of all inventory owned
by the Company and its Subsidiaries as of such date, all calculated on a
consolidated basis and in accordance with GAAP. To the extent that
information is not available as to the amount of accounts receivable or
inventory or trade payables as of a specific date, the Company may utilize
the most recent available information provided to the lenders under the
Credit Facilities for purposes of calculating the Borrowing Base.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at such time be required to be capitalized on a balance
sheet in accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or
limited liability company, partnership or membership interests (whether
general or limited) and (iv) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses
of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars, (ii)
securities issued or directly and fully guaranteed or insured by the full
faith and credit of the United States government or any agency or
instrumentality thereof having maturities of not more than six months from
the date of acquisition, (iii) certificates of deposit and eurodollar time
deposits with maturities of six months or less from the date of
acquisition, bankers' acceptances with maturities not exceeding six months
and overnight bank deposits, in each case with any lender party to the New
Credit Facility or with any domestic commercial bank having capital and
surplus in excess of $500.0 million and a Xxxxx Bank Watch Rating of "B" or
better, (iv) repurchase obligations with a term of not more than seven days
for underlying securities of the types described in clauses (ii) and (iii)
above entered into with any financial institution meeting at the time of
purchase the qualifications specified in clause (iii) above and (v)
commercial paper of a domestic issuer having at the time of purchase a
rating of at least A-1 by Standard and Poor's Rating Group ("S&P") or P-1
by Xxxxx'x Investors Service, Inc. ("Moody's") maturing within six months
after the date of acquisition.
"Cedel" means Cedel Bank, S.A..
"Change of Control" means the occurrence of any of the following:
(i) the sale, lease, transfer, conveyance or other disposition (other than
by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of the Company and
its Restricted Subsidiaries taken as a whole to any "person" (as such term
is used in Section 13(d)(3) of the Exchange Act) other than the Principals
or their Related Parties, (ii) the adoption of a plan relating to the
liquidation or dissolution of the Company, (iii) the consummation of any
transaction (including, without limitation, any merger or consolidation)
the result of which is that any person (as defined above), other than the
Principals and their Related Parties, becomes the beneficial owner (as
defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or
indirectly, of 35% or more of the Voting Stock of the Company, (iv) the
first day on which a majority of the members of the Board of Directors of
the Company are not Continuing Directors or (v) the Company consolidates
with, or merges with or into, any Person or sells, assigns, conveys,
transfers, leases or otherwise disposes of all or substantially all of its
assets to any Person, or any Person consolidates with, or merges with or
into, the Company, in any such event pursuant to a transaction in which any
of the outstanding Voting Stock of the Company is converted into or
exchanged for cash, securities or other property, other than any such
transaction where the Voting Stock of the Company outstanding immediately
prior to such transaction is converted into or exchanged for Voting Stock
(other than Disqualified Stock) of the surviving or transferee Person
constituting a majority of the outstanding shares of such Voting Stock of
such surviving or transferee Person (immediately after giving effect to
such issuance).
"Company" means Xxxxxxx Sports Inc., and any and all successors
thereto.
"Consolidated Cash Flow" means, with respect to any Person for
any period, the Consolidated Net Income of such Person for such period plus
(i) an amount equal to any extraordinary loss plus any net loss realized in
connection with an Asset Sale (to the extent such losses were deducted in
computing such Consolidated Net Income), plus (ii) provision for taxes
based on income or profits of such Person and its Subsidiaries for such
period, to the extent that such provision for taxes was included in
computing such Consolidated Net Income, plus (iii) consolidated interest of
such Person and its Subsidiaries for such period, whether paid or accrued
and whether or not capitalized (including, without limitation, amortization
of debt issuance costs and original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations, the
interest component of all payments associated with Capital Lease
Obligations, commissions, discounts and other fees and charges incurred in
respect of letter of credit or bankers' acceptance financings, net payments
(if any) pursuant to Hedging Obligations and any deferred financing fees
incurred, and other financing fees expensed, in connection with the
acquisition of Varsity), to the extent that any such expense was deducted
in computing such Consolidated Net Income, plus (iv) depreciation,
amortization (including amortization of goodwill and other intangibles but
excluding amortization of prepaid cash expenses that were paid in a prior
period) and other non-cash expenses (excluding any such non-cash expense to
the extent that it represents an accrual of or reserve for cash expenses in
any future period or amortization of a prepaid cash expense that was paid
in a prior period) of such Person and its Subsidiaries for such period to
the extent that such depreciation, amortization and other non-cash expenses
were deducted in computing such Consolidated Net Income, plus (v) any other
fees or expenses expensed in connection with the acquisition of Varsity, in
each case, without duplications and on a consolidated basis and determined
in accordance with GAAP. Notwithstanding the foregoing, the provision for
taxes based on the income or profits of, and the depreciation and
amortization and other non-cash charges of, a Subsidiary of a Person shall
be added to Consolidated Net Income to compute Consolidated Cash Flow only
to the extent (and in the same proportion) that the Net Income of such
Subsidiary was included in calculating the Consolidated Net Income of such
Person and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Subsidiary without
prior approval (that has not been obtained), pursuant to the terms of its
charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to that Subsidiary
or its stockholders.
"Consolidated Net Income" means, with respect to any Person for
any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis,
determined in accordance with GAAP; provided that (i) the Net Income (but
not loss) of any Person that is not a Restricted Subsidiary or that is
accounted for by the equity method of accounting shall be included only to
the extent of the amount of dividends or distributions paid in cash to the
referent Person or a Restricted Subsidiary thereof, (ii) the Net Income of
any Restricted Subsidiary shall be excluded to the extent that the
declaration or payment of dividends or similar distributions by that
Restricted Subsidiary of that Net Income is not at the date of
determination permitted without any prior governmental approval (that has
not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute,
rule or governmental regulation applicable to that Restricted Subsidiary or
its stockholders, (iii) the Net Income of any Person acquired in a pooling
of interests transaction for any period prior to the date of such
acquisition shall be excluded, (iv) the cumulative effect of a change in
accounting principles shall be excluded and (v) the Net Income (but not
loss) of any Unrestricted Subsidiary shall be excluded, whether or not
distributed to the Company or one of its Subsidiaries.
"Continuing Directors" means, as of any date of determination,
any member of the Board of Directors of the Company who (i) was a member of
such Board of Directors on the date of this Indenture or (ii) was nominated
for election or elected to such Board of Directors with the approval of a
majority of the Continuing Directors who were members of such Board at the
time of such nomination or election.
"Corporate Trust Office of the Trustee" shall be at the address
of the Trustee specified in Section 11.02 hereof or such other address as
to which the Trustee may give notice to the Company.
"Credit Facilities" means, with respect to the Company, one or
more debt facilities (including, without limitation, the New Credit
Facility) or commercial paper facilities with banks or other institutional
lenders providing for revolving credit loans, term loans, receivables
financing (including through the sale of receivables to such lenders or to
special purpose entities formed to borrow from such lenders against such
receivables) or letters of credit, in each case, as amended, restated,
modified, renewed, refunded, replaced or refinanced in whole or in part
from time to time. Indebtedness under Credit Facilities outstanding on the
date on which Senior Notes are first issued and authenticated under this
Indenture shall be deemed to have been incurred on such date in reliance on
the exception provided by clause (i) of the definition of Permitted Debt.
"Default" means any event that is or with the passage of time or
the giving of notice or both would be an Event of Default.
"Definitive Note" means a certificated Senior Note registered in
the name of the Holder thereof and issued in accordance with Section 2.06
hereof, in the form of Exhibit A hereto except that such Senior Note shall
not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.
"Depositary" means, with respect to the Senior Notes issuable or
issued in whole or in part in global form, the Person specified in Section
2.03 hereof as the Depositary with respect to the Senior Notes, and any and
all successors thereto appointed as depositary hereunder and having become
such pursuant to the applicable provision of this Indenture.
"Disqualified Stock" means 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 redeemable at the option of the Holder thereof, in whole or in part, on
or prior to the date that is 91 days after the date on which the Senior
Notes mature; provided, however, that a class of Capital Stock shall not be
Disqualified Stock hereunder solely as the result of any maturity or
redemption that is conditioned upon, and subject to, compliance with
Section 4.07.
"Equity Interests" means Capital Stock and all warrants, options
or other rights to acquire Capital Stock (but excluding any debt security
that is convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means a public or private offering of Capital
Stock (other than Disqualified Stock) of the Company.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means the Senior Notes issued in the Exchange
Offer pursuant to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration
Rights Agreement.
"Exchange Offer Registration Statement" has the meaning set forth
in the Registration Rights Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the New Credit Facility) in
existence on the date of this Indenture, until such amounts are repaid.
"Fixed Charges" means, with respect to any Person for any period,
the sum, without duplication, of (i) the consolidated interest expense of
such Person and its Restricted Subsidiaries for such period, whether paid
or accrued (including, without limitation amortization of original issue
discount, non-cash interest payments, the interest component of any
deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, commissions, discounts and other
fees and charges incurred in respect of letter of credit or bankers'
acceptance financings, and net payments (if any) pursuant to Hedging
Obligations but excluding amortization of debt issuance costs and excluding
any deferred financing fees incurred, and other financing fees expensed, in
connection with the acquisition of Varsity) and (ii) the consolidated
interest of such Person and its Restricted Subsidiaries that was
capitalized during such period, and (iii) any interest expense on
Indebtedness of another Person that is Guaranteed by such Person or one of
its Restricted Subsidiaries or secured by a Lien on assets of such Person
or one of its Restricted Subsidiaries (whether or not such Guarantee or
Lien is called upon) and (iv) the product of (a) all cash dividend payments
on any series of preferred stock of such Person or any of its Restricted
Subsidiaries, other than dividend payments on Equity Interests payable
solely in Equity Interests (other than Disqualified Stock) of the Company,
times (b) a fraction, the numerator of which is one and the denominator of
which is one minus the then current combined federal, state and local
statutory tax rate of such Person and its Restricted Subsidiaries,
expressed as a decimal, in each case, on a consolidated basis and in
accordance with GAAP.
"Fixed Charge Coverage Ratio" means with respect to any Person
for any period, the ratio of the Consolidated Cash Flow of such Person and
its Restricted Subsidiaries for such period to the Fixed Charges of such
Person and its Restricted Subsidiaries for such period. In the event that
the Company or any of its Restricted Subsidiaries incurs, assumes,
Guarantees or redeems any Indebtedness (other than revolving credit
borrowings) or issues preferred stock subsequent to the commencement of the
period for which the Fixed Charge Coverage Ratio is being calculated but
prior to the date on which the event for which the calculation of the Fixed
Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed
Charge Coverage Ratio shall be calculated giving pro forma effect to such
incurrence, assumption, Guarantee or redemption of Indebtedness, or such
issuance or redemption of preferred stock, as if the same had occurred at
the beginning of the applicable four-quarter reference period. In addition,
for purposes of making the computation referred to above, (i) acquisitions
that have been made by the Company or any of its Restricted Subsidiaries,
including through mergers or consolidations and including any related
financing transactions, during the four-quarter reference period or
subsequent to such reference period and on or prior to the Calculation Date
shall be deemed to have occurred on the first day of the four-quarter
reference period and Consolidated Cash Flow for such reference period shall
be calculated without giving effect to clause (iii) of the proviso set
forth in the definition of Consolidated Net Income, and (ii) the
Consolidated Cash Flow attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses disposed
of prior to the Calculation Date, shall be excluded, and (iii) the Fixed
Charges attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the
obligations giving rise to such Fixed Charges shall not be obligations of
the referent Person or any of its Restricted Subsidiaries following the
Calculation Date.
"GAAP" means generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant
segment of the accounting profession, which are in effect as of the date of
this Indenture.
"Global Notes" means, individually and collectively, each of the
Restricted Global Notes and the Unrestricted Global Notes, substantially in
the form of Exhibit A hereto issued in accordance with Section 2.01,
2.06(b)(iv), 2.06(d)(ii)-(iii) or 2.06(f) hereof.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii) hereof, which is required to be placed on all Global Notes
issued under this Indenture.
"Government Securities" means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment
for which the United States pledges its full faith and credit.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection 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.
"Guarantor" means any Subsidiary that executes a Subsidiary
Guarantee in accordance with the provisions of this Indenture, and its
respective successors and assigns.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements and (ii)
other agreements or arrangements designed to protect such Person against
fluctuations in interest rates or the value of foreign currencies purchased
or received by the Company in the ordinary course of business.
"Holder" means a Person in whose name a Senior Note is
registered.
"IAI Global Note" means the global Senior Note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with or on behalf of, and registered in the name of,
the Depositary or its nominee that will be issued in a denomination equal
to the outstanding principal amount of the Senior Notes sold to
Institutional Accredited Investors.
"Indebtedness" means, with respect to any Person, any
indebtedness of such Person, whether or not contingent, in respect of
borrowed money or evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in respect
thereof) or banker's acceptances or representing Capital Lease Obligations
or the balance deferred and unpaid of the purchase price of any property or
representing any Hedging Obligations, in each case, except any amount that
constitutes an accrued expense or trade payable, if and to the extent any
of the foregoing indebtedness (other than letters of credit and Hedging
Obligations) would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, as well as all indebtedness of
others secured by a Lien on any asset of such Person (whether or not such
indebtedness is assumed by such Person) and, to the extent not otherwise
included, the Guarantee by such Person of any indebtedness of any other
Person. The amount of any Indebtedness outstanding as of any date shall be
(i) the accreted value thereof, in the case of any Indebtedness that does
not require current payments of interest, and (ii) the principal amount
thereof, together with any interest thereon that is more than 30 days past
due, in the case of any other Indebtedness.
"Indenture" means this Indenture, as amended or supplemented from
time to time.
"Indirect Participant" means entities that clear through or
maintain a custodial relationship with a Participant either directly or
indirectly.
"Initial Purchaser" means each of NationsBanc Capital Markets,
Inc. and First Chicago Capital Markets, Inc.
"Initial Senior Notes" means $115,000,000 aggregate principal
amount of Senior Notes issued under this Indenture on the Issue Date.
"Institutional Accredited Investor" means an institution that is
an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act, who are not also QIBs.
"Investments" means, with respect to any Person, all investments
by such Person in other Persons (including Affiliates) in the forms of
direct or indirect loans (including guarantees of Indebtedness or other
obligations), advances or capital contributions (excluding commission,
travel and similar advances to officers and employees made in the ordinary
course of business), purchases or other acquisitions for consideration of
Indebtedness, Equity Interests or other securities, together with all items
that are or would be classified as investments on a balance sheet prepared
in accordance with GAAP. If the Company or any Subsidiary of the Company
sells or otherwise disposes of any Equity Interests of any direct or
indirect Restricted Subsidiary of the Company such that, after giving
effect to any such sale or disposition, such Person is no longer a
Restricted Subsidiary of the Company, the Company shall be deemed to have
made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Restricted Subsidiary not
sold or disposed of in an amount determined as provided in the final
paragraph of Section 4.07 hereof.
"Issue Date" means the date of this Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York or at a place of payment are
authorized by law, regulation or executive order to remain closed. If a
payment date is a Legal Holiday at a place of payment, payment may be made
at that place on the next succeeding day that is not a Legal Holiday, and
no interest shall accrue on such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Senior Notes for use
by such Holders in connection with the Exchange Offer.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest in and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction).
"Liquidated Damages" means all liquidated damages then owing
pursuant to Section 6 of the Registration Rights Agreement.
"MOU" means the Memorandum of Understanding entered into as of
the 3rd day of June, 1997, by and among the Company, RHC Licensing
Corporation, Xxxxxxx, Inc., Equilink Licensing Corporation, Ridmark
Corporation, MacMark Corporation, NBD Bank N.A., MLC Partners Limited
Partnership, Xxxxxx Xxxxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxx XxXxxxxxxxx, Xx.,
Xxxxxxx X. Xxxxxx, Connecticut Economics Corporation, Xxxxxx Xxxxxxx, Xxxxx
X. Xxxxxx, as Bankruptcy Trustee of M Holdings Corporation, Xxxx Xxxxxxx,
as Bankruptcy Trustee of MGS Acquisition, Inc., Official Unsecured
Creditors' Committee of MacGregor Sporting Goods, Inc., M Holdings
Corporation, f/k/a MacGregor Sporting Goods, Inc., Innovative Promotions,
Inc., Xxxxxx Xxxx, Xx., Xxxxx Xxxx, Pursuit Athletic Footwear, Inc., and
Xxxxxxx Athletic Footwear, Inc. in the form set forth on a Schedule 11.19
of the New Credit Facility.
"Net Income" means, with respect to any Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however, (i)
any gain (but not loss), together with any related provision for taxes on
such gain (but not loss), realized in connection with (a) any Asset Sale
(including, without limitation, dispositions pursuant to sale and leaseback
transactions) or (b) the disposition of any securities by such Person or
any of its Restricted Subsidiaries or the extinguishment of any
Indebtedness of such Person or any of its Restricted Subsidiaries and (ii)
any extraordinary or nonrecurring gain (but not loss), together with any
related provision for taxes on such extraordinary or nonrecurring gain (but
not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net
of the direct costs relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions) and any relocation expenses incurred as a result thereof,
taxes paid or payable as a result thereof (after taking into account any
available tax credits or deductions and any tax sharing arrangements),
amounts required to be applied to the repayment of Indebtedness (other than
Indebtedness under the Credit Facilities) secured by a Lien on the asset or
assets that were the subject of such Asset Sale and any reserve for
adjustment in respect of the sale price of such asset or assets established
in accordance with GAAP.
"New Credit Facility" means that certain credit facility, dated
as of June 19, 1997, by and among the Company and NationsBank, N.A. and NBD
Bank, as agents and lenders, providing for up to $40.0 million of revolving
credit borrowings, including any related notes, guarantees, collateral
documents, instruments and agreements executed in connection therewith, and
in each case as amended, extended, modified, renewed, refunded, replaced or
refinanced from time to time.
"Non Recourse Debt" means Indebtedness (i) as to which neither
the Company nor any of its Restricted Subsidiaries (a) provides credit
support of any kind (including any undertaking, agreement or instrument
that would constitute Indebtedness), (b) is directly or indirectly liable
(as a guarantor or otherwise), or (c) constitutes the lender; and (ii) no
default with respect to which (including any rights that the holders
thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit (upon notice, lapse of time or both) any holder of
any other Indebtedness of the Company or any of its Restricted Subsidiaries
to declare a default on such other Indebtedness or cause the payment
thereof to be accelerated or payable prior to its stated maturity; and
(iii) as to which the lenders have been notified in writing that they will
not have any recourse to the stock or assets of the Company or any of its
Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Note Custodian" means the Trustee, as custodian with respect to
the Senior Notes in global form, or any successor entity thereto in such
capacity.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"Offering" means the offering of the Senior Notes by the Company.
"Offering Memorandum" means the offering memorandum dated June
13, 1997 with respect to the Offering of the Senior Notes.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, any Assistant
Treasurer, the Controller, the Secretary, any Assistant Secretary or any
Vice-President of such Person.
"Officers' Certificate" means a certificate signed on behalf of
the Company by two Officers of the Company, one of whom must be the
principal executive officer, the principal financial officer, the treasurer
or the principal accounting officer of the Company, that meets the
requirements of Section 11.05 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of
Section 11.05 hereof. The counsel may be an employee of or counsel to the
Company, any Subsidiary of the Company or the Trustee.
"Participant" means, with respect to the Depositary, Euroclear or
Cedel, a Person who has an account with the Despositary, Euroclear or
Cedel, respectively (and, with respect to the Depositary, shall include
Euroclear and Cedel).
"Participating Broker-Dealer" has the meaning set forth in the
Registration Rights Agreement.
"Permitted Businesses" means (i) the lines of businesses that the
Company or any of the Guarantors were engaged in on the date of this
Indenture or that are contemplated by the Offering Memorandum, (ii) the
businesses engaged in by any acquired businesses, provided that a
substantial portion of their business at the time of acquisition was
related or ancillary to the Company's then existing lines of business,
(iii) extensions of the businesses referred to in clauses (i) and (ii),
including, without limitation, new products and services to its markets or
new distribution channels, (iv) any other lines of business or activities
that are related or ancillary to the businesses referred to in clauses
(i)-(iii), and (v) unrelated lines of business that individually are not
material to the Company and the Guarantors taken as a whole.
"Permitted Investments" means (a) any Investment in the Company
or in a Guarantor, (b) any continuing 50% equity Investment in MacMark
Corporation by the Company or any Guarantor; (c) any Investment in Cash
Equivalents; (d) any Investment by the Company or any Guarantor in a
Person, if as a result of such Investment (i) such Person becomes a
Guarantor or (ii) such Person is merged, consolidated or amalgamated with
or into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Guarantor; (e) any Investment made as a
result of the receipt of non-cash consideration from an Asset Sale that was
made pursuant to and in compliance with Section 4.10; (f) any acquisition
of assets solely in exchange for the issuance of Equity Interests (other
than Disqualified Stock) of the Company; and (g) other Investments in any
Person having an aggregate fair market value (measured on the date each
such Investment was made and without giving effect to subsequent changes in
value), when taken together with all other Investments made pursuant to
this clause (g) that are at the time outstanding, not to exceed $5.0
million.
"Permitted Liens" means (i) Liens on assets of the Company and
its Subsidiaries securing Indebtedness under the Credit Facilities that was
permitted by the terms of this Indenture to be incurred; provided that such
Liens shall be permitted only to the extent they cover assets securing such
Indebtedness as of the date of this Indenture; (ii) Liens in favor of the
Company; (iii) Liens on property of a Person existing at the time such
Person is merged into or consolidated with the Company or any Subsidiary of
the Company; provided that such Liens were in existence prior to the
contemplation of such merger or consolidation and do not extend to any
assets other than those of the Person merged into or consolidated with the
Company or such Subsidiary; (iv) Liens on property existing at the time of
acquisition thereof by the Company or any Subsidiary of the Company,
provided that such Liens were in existence prior to the contemplation of
such acquisition; (v) Liens to secure the performance of statutory or
regulatory obligations, leases, surety or appeal bonds, performance bonds
or other obligations of a like nature incurred in the ordinary course of
business; (vi) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by clause (iv) of the third paragraph of Section
4.09 covering only the assets acquired with such Indebtedness; (vii) Liens
existing on the date of this Indenture; (viii) Liens for taxes, assessments
or governmental charges or claims that are not yet delinquent or that are
being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded, provided that any reserve or other
appropriate provision as shall be required in conformity with GAAP shall
have been made therefor; (ix) Liens incurred in the ordinary course of
business of the Company or any Subsidiary of the Company with respect to
obligations that do not exceed $2.5 million at any one time outstanding and
that (a) are not incurred in connection with the borrowing of money or the
obtaining of advances or credit (other than trade credit in the ordinary
course of business) and (b) do not in the aggregate materially detract from
the value of the property or materially impair the use thereof in the
operation of business by the Company or such Subsidiary; (x) Liens on
assets of any Guarantor to secure Senior Indebtedness of such Guarantor
that is permitted to be incurred pursuant to the terms of Indenture; (xi)
Liens on assets of Unrestricted Subsidiaries that secure Non-Recourse Debt
of Unrestricted Subsidiaries; and (xii) Liens on Unrestricted Margin Stock.
"Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries issued in exchange for,
or the net proceeds of which are used to extend, refinance, renew, replace,
defease or refund Indebtedness of the Company or any of its Restricted
Subsidiaries; provided that: (i) the principal amount (or accreted value,
if applicable) of such Permitted Refinancing Indebtedness does not exceed
the principal amount of (or accreted value, if applicable), plus accrued
interest on, the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus the amount of reasonable expenses incurred in
connection therewith including premiums paid, if any, to the holders
thereof); (ii) such Permitted Refinancing Indebtedness has a final maturity
date at or later than the final maturity date of, and has a Weighted
Average Life to Maturity equal to or greater than the Weighted Average Life
to Maturity of, the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; (iii) if the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded is subordinated in
right of payment to the Senior Notes, such Permitted Refinancing
Indebtedness has a final maturity date at or later than the final maturity
date of, and is subordinated in right of payment to, the Senior Notes on
terms at least as favorable to the Holders of Senior Notes as those
contained in the documentation governing the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded; and (iv) such
Indebtedness is incurred either by the Company or by the Restricted
Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization or government or agency or political subdivision thereof
(including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or
business).
"Principals" means Xxxxxx X. Xxxxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxx
XxXxxxxxxxx, Xx., Xxxxx Xxxxx, Xxx Xxxxxxx or Xxxxxxx X. Xxxx.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) to be placed on all Senior Notes issued under this Indenture
except where otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of June 19, 1997, by and among the Company and the
other parties named on the signature pages thereof, as such agreement may
be amended, modified or supplemented from time to time and, with respect to
any Additional Senior Notes, one or more registration rights agreements
between the Company and the other parties named on the signature pages
thereof, as such agreement(s) may be amended, modified or supplemented from
time to time, relating to rights given by the Company to the purchasers of
any Additional Senior Notes that may be issued pursuant to the provisions
of this Indenture to register such Additional Senior Notes under the
Securities Act.
"Regulation S" means Regulation S promulgated under the
Securities Act.
"Regulation S Global Note" means a Global Note bearing the
Private Placement Legend and deposited with or on behalf of the Depositary
and registered in the name of its nominee, issued in a denomination equal
to the outstanding principal amount of the Senior Notes initially sold in
reliance on Rule 903 of Regulation S.
"Related Party" with respect to any Principal means (A) any
spouse or former spouse or immediate family member of such Principal, (B)
the estate or any heir of such Principal, (C) any Subsidiary of any of the
Principals or any other Related Party or (D) any trust, the beneficiaries
of whom are Principals or Related Parties.
"Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Administration of the Trustee
(or any successor group of the Trustee)with direct responsibility for the
administration of this Indenture and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Definitive Note" means a Definitive Note bearing the
Private Placement Legend.
"Restricted Global Note" means a global Senior Note bearing the
Private Placement Legend.
"Restricted Investment" means an Investment other than a
Permitted Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means any Indebtedness which by its terms
is not expressly subordinated in right of payment to the Senior Notes.
"Senior Notes" means the Company's 10 1/2% Senior Notes due 2007
issued pursuant to this Indenture.
"Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"Significant Restricted Subsidiary" means a subsidiary, including
its subsidiaries, which meets any of the following conditions:
(1) The Company's and its other subsidiaries' investments
in and advances to the subsidiary exceed 10 percent of the total
assets of the Company and its subsidiaries consolidated as of the
end of the most recently completed fiscal year (for a proposed
business combination to be accounted for as a pooling of
interests, this condition is also met when the number of common
shares exchanged or to be exchanged by the registrant exceeds 10
percent of its total common shares outstanding at the date the
combination is initiated); or
(2) The Company's and its other subsidiaries' proportionate
share of the total assets (after intercompany eliminations) of
the subsidiary exceeds 10 percent of the total assets of the
Company and its subsidiaries consolidated as of the end of the
most recently completed fiscal year; or
(3) The Company's and its other subsidiaries' equity in the
income from continuing operations before income taxes,
extraordinary items and cumulative effect of a change in
accounting principle of the subsidiary exceeds 10 percent of such
income of the Company and its subsidiaries consolidated for the
most recently completed fiscal year. For purposes of this
definition under this Indenture, a "significant subsidiary" shall
be determined in accordance with the Computational Senior Note
Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to
the Act, as such Regulation is in effect on the date hereof.
"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 is in
effect on the date of this Indenture.
"Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any
contingent obligations to repay, redeem or repurchase any such interest or
principal prior to the date originally scheduled for the payment thereof.
"Subsidiary" means, with respect to any Person, (i) any
corporation, association or other business entity of which more than 50% of
the total voting power of shares of Capital Stock entitled (without regard
to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly
or indirectly, by such Person or one or more of the other Subsidiaries of
that Person (or a combination thereof) and (ii) any partnership (a) the
sole general partner or the managing general partner of which is such
Person or a Subsidiary of such Person or (b) the only general partners of
which are such Person or of one or more Subsidiaries of such Person (or any
combination thereof).
"Subsidiary Guarantee" means the Guarantee by each Guarantor of
the Company's payment obligations under this Indenture and on the Senior
Notes, executed pursuant to the provisions of this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the Trust Indenture Act of 1939; provided, however, that in the event
the Trust Indenture Act of 1939 is amended after such date, then "TIA"
means, to the extent required by such amendment, the Trust Indenture Act of
1939 as so amended.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture
and thereafter means the successor serving hereunder.
"Unrestricted Definitive Note" means one or more Definitive Notes
that do not bear and are not required to bear the Private Placement Legend.
"Unrestricted Global Note" means a permanent Global Note in the
form of Exhibit A attached hereto that bears the Global Note Legend and
that has the "Schedule of Exchanges of Interests in the Global Note"
attached thereto, and that is deposited with or on behalf of and registered
in the name of the Depositary, representing a series of Senior Notes that
do not bear the Private Placement Legend.
"Unrestricted Margin Stock" means the capital stock of Varsity
that constitutes "margin stock" (as defined in Regulation G of the Board of
Governors of the Federal Reserve System as from time to time in effect),
if, and to the extent that the value of such margin stock exceeds 25% of
the total assets of the Company and its Subsidiaries, subject to the
restrictions contained in Sections 4.10 and 4.12 hereof; provided that it
is understood that upon completion of the merger pursuant to the Varsity
Merger Documents there shall be no Unrestricted Margin Stock outstanding.
"Unrestricted Subsidiary" means (i) any Subsidiary (other than
Xxxxxxx, Inc. or Varsity or any successor to either of them) that is
designated by the Board of Directors as an Unrestricted Subsidiary pursuant
to a Board Resolution, but only to the extent that such Subsidiary: (a) has
no Indebtedness other than Non-Recourse Debt; (b) is not party to any
agreement, contract, arrangement or understanding with the Company or any
Restricted Subsidiary of the Company unless the terms of any such
agreement, contract, arrangement or understanding are no less favorable to
the Company or such Restricted Subsidiary than those that might be obtained
at the time from Persons who are not Affiliates of the Company (as
determined in good faith by the Board of Directors); (c) is a Person with
respect to which neither the Company nor any of its Restricted Subsidiaries
has any direct or indirect obligation (x) to subscribe for additional
Equity Interests or (y) to maintain or preserve such Person's financial
condition or to cause such Person to achieve any specified levels of
operating results; (d) has not guaranteed or otherwise directly or
indirectly provided credit support for any Indebtedness of the Company or
any of its Restricted Subsidiaries; and (e) has at least one director on
its board of directors that is not a director or executive officer of the
Company or any of its Restricted Subsidiaries and has at least one
executive officer that is not a director or executive officer of the
Company or any of its Restricted Subsidiaries.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under
the Securities Act.
"Varsity" shall mean Varsity Spirit Corporation, an Illinois
corporation.
"Varsity Merger Documents" means the Agreement and Plan of Merger
by and among Xxxxxxx Sports Inc., Cheer Acquisition Corp. and Varsity
Spirit Corporation, dated as of May 5, 1997, and the several Stock Purchase
Agreements, dated as of May 5, 1997, between Xxxxxxx Sports Inc. and
certain employees of Varsity Spirit Corporation, in each case as amended
from to time.
"Voting Stock" means, with respect to any Person, the Capital
Stock of such Person that is at the time entitled to vote in the election
of the board of directors of such Person.
"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
payments of principal, including payment at final maturity, in respect
thereof, by (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 principal amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person all of the outstanding Capital Stock
or other ownership interests of which (other than directors' qualifying
shares) shall at the time be owned by such Person or by one or more Wholly
Owned Restricted Subsidiaries of such Person and one or more Wholly Owned
Restricted Subsidiaries of such Person.
SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
"Affiliate Transaction"............................. 4.11
"Asset Sale Offer".................................. 3.09
"Authentication Order".............................. 2.02
"Change of Control Offer"........................... 4.15
"Change of Control Payment"......................... 4.15
"Change of Control Payment Date".................... 4.15
"Covenant Defeasance"............................... 8.03
"Event of Default".................................. 6.01
"Excess Proceeds"................................... 4.10
"incur"............................................. 4.09
"Legal Defeasance" ................................. 8.02
"Offer Amount"...................................... 3.09
"Offer Period"...................................... 3.09
"Paying Agent"...................................... 2.03
"Payment Default"................................... 6.01
"Permitted Debt".................................... 4.09
"Purchase Date"..................................... 3.09
"Registrar"......................................... 2.03
"Replacement Assets"................................ 4.10
"Restricted Payments"............................... 4.07
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this
Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Senior Notes;
"indenture security Holder" means a Holder of a Senior Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
and
"obligor" on the Senior Notes and the Subsidiary Guarantees means
the Company and the Guarantors, respectively, and any successor obligor
upon the Senior Notes and the Subsidiary Guarantees, respectively.
All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule
under the TIA have the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement of successor
sections or rules adopted by the SEC from time to time.
ARTICLE 2
THE NOTES
SECTION 2.01. FORM AND DATING.
The Senior Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto. The Subsidiary
Guarantees shall be substantially in the form of Exhibit F attached hereto,
the terms of which are incorporated in and made a part of this Indenture.
The Senior Notes may have notations, legends or endorsements required by
law, stock exchange rule or usage. Each Senior Note shall be dated the date
of its authentication. The Senior Notes shall be in denominations of $1,000
and integral multiples thereof.
The terms and provisions contained in the Senior Notes shall
constitute, and are hereby expressly made, a part of this Indenture and the
Company, the Guarantors and the Trustee, by their execution and delivery of
this Indenture, expressly agree to such terms and provisions and to be
bound thereby. However, to the extent any provision of any Senior Note
conflicts with the express provisions of this Indenture, the provisions of
this Indenture shall govern and be controlling.
Senior Notes issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the Global Note Legend affixed
thereon and the "Schedule of Exchanges of Interests in the Global Note"
attached thereto). Senior Notes issued in definitive form shall be
substantially in the form of Exhibit A attached hereto (but without the
Global Note Legend affixed thereon and without the "Schedule of Exchanges
of Interests in the Global Note" attached thereto). Each Global Note shall
represent such of the outstanding Senior Notes as shall be specified
therein and each shall provide that it shall represent the aggregate
principal amount of outstanding Senior Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Senior Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a
Global Note to reflect the amount of any increase or decrease in the
aggregate principal amount of outstanding Senior Notes represented thereby
shall be made by the Trustee or the Note Custodian, at the direction of the
Trustee, in accordance with instructions given by the Holder thereof as
required by Section 2.06 hereof.
The provisions of the "Operating Procedures of the Euroclear
System" and "Terms and Conditions Governing Use of Euroclear" and the
"General Terms and Conditions of Cedel Bank" and "Customer Handbook" of
Cedel Bank shall be applicable to transfers of beneficial interests in the
Regulation S Global Note that is held by the Agent Members through
Euroclear or Cedel Bank.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Senior Notes for the Company by
manual or facsimile signature. The Company's seal shall be reproduced on
the Senior Notes and may be in facsimile form.
If an Officer whose signature is on a Senior Note no longer holds
that office at the time a Senior Note is authenticated, the Senior Note
shall nevertheless be valid.
A Senior Note shall not be valid until authenticated by the
manual signature of the Trustee. The signature shall be conclusive evidence
that the Senior Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by
two Officers (an "Authentication Order"), authenticate Senior Notes for
original issue up to the aggregate principal amount stated in paragraph 4
of the Senior Notes plus Senior Notes issued to pay Liquidated Damages
pursuant to paragraph 2 of the Senior Notes. The aggregate principal amount
of Senior Notes outstanding at any time may not exceed $140,000,000 except
as provided in Section 2.07 hereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Senior Notes. An authenticating agent may
authenticate Senior Notes whenever the Trustee may do so. Each reference in
this Indenture to authentication by the Trustee includes authentication by
such agent. An authenticating agent has the same rights as an Agent to deal
with Holders or an Affiliate of the Company.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Senior Notes
may be presented for registration of transfer or for exchange ("Registrar")
and an office or agency where Senior Notes may be presented for payment
("Paying Agent"). The Registrar shall keep a register of the Senior Notes
and of their transfer and exchange. The Company may appoint one or more
co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent" includes
any additional paying agent. The Company may change any Paying Agent or
Registrar without notice to any Holder. The Company shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or
any of its Subsidiaries may act as Paying Agent or Registrar.
The Company initially appoints The Depository Trust Company to
act as Depositary with respect to the Global Notes.
The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Note Custodian with respect to the
Global Notes.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent will hold in trust for
the benefit of Holders or the Trustee all money held by the Paying Agent
for the payment of principal, premium or Liquidated Damages, if any, or
interest on the Senior Notes, and will notify the Trustee of any default by
the Company in making any such payment. While any such default continues,
the Trustee may require a Paying Agent to pay all money held by it to the
Trustee. The Company at any time may require a Paying Agent to pay all
money held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary) shall have no
further liability for the money. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money held by it as Paying Agent. Upon any
bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Senior Notes.
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 all Holders and shall otherwise comply with TIA ss. 312(a). If the
Trustee is not the Registrar, the Company shall furnish to the Trustee at
least seven Business Days before each interest payment date and at such
other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and
addresses of the Holders of Senior Notes and the Company shall otherwise
comply with TIA ss. 312(a).
SECTION 2.06. TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Notes. A Global Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global
Notes will be exchanged by the Company for Definitive Notes if (i) the
Company delivers to the Trustee notice from the Depositary that it is
unwilling or unable to continue to act as Depositary or that it is no
longer a clearing agency registered under the Exchange Act and, in either
case, a successor Depositary is not appointed by the Company within [90]
days after the date of such notice from the Depositary or (ii) the Company
in its sole discretion determines that the Global Notes (in whole but not
in part) should be exchanged for Definitive Notes and delivers a written
notice to such effect to the Trustee. Upon the occurrence of either of the
preceding events in (i) or (ii) above, Definitive Notes shall be issued in
such names as the Depositary shall instruct the Trustee. Global Notes also
may be exchanged or replaced, in whole or in part, as provided in Sections
2.07 and 2.10 hereof. Every Senior Note authenticated and delivered in
exchange for, or in lieu of, a Global Note or any portion thereof, pursuant
to this Section 2.06, Section 2.07 or 2.10 hereof, shall be authenticated
and delivered in the form of, and shall be, a Global Note. A Global Note
may not be exchanged for another Senior Note other than as provided in this
Section 2.06(a), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.06(b), (c) or (f)
hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial
interests in the Restricted Global Notes shall be subject to restrictions
on transfer comparable to those set forth herein to the extent required by
the Securities Act. Transfers of beneficial interests in the Global Notes
also shall require compliance with either subparagraph (i) or (ii) below,
as applicable, as well as one or more of the other following subparagraphs
as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial
interest in the same Restricted Global Note in accordance with the
transfer restrictions set forth in the Private Placement Legend;
provided, however, that beneficial interests in the IAI Global Note
may not under any circumstances be transferred to a Person who takes
delivery thereof in the form of a beneficial interest in the IAI
Global Note and, provided further, that prior to the expiration of
the Restricted Period transfers of beneficial interests in the
Regulation S Global Note may not be made to a U.S. Person or for the
account or benefit of a U.S. Person (other than an Initial
Purchaser). Beneficial interests in any Unrestricted Global Note may
be transferred only to Persons who take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note. No written
orders or instructions shall be required to be delivered to the
Registrar to effect the transfers described in this Section
2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of
beneficial interests (other than a transfer of a beneficial interest
in a Global Note to a Person who takes delivery thereof in the form
of a beneficial interest in the same Global Note), the transferor of
such beneficial interest must deliver to the Registrar either (A) (1)
a written order from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable Procedures
directing the Depositary to credit or cause to be credited a
beneficial interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2)
instructions given in accordance with the Applicable Procedures
containing information regarding the Participant account to be
credited with such increase or (B) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2)
instructions given by the Depositary to the Registrar containing
information regarding the Person in whose name such Definitive Note
shall be registered to effect the transfer or exchange referred to in
(1) above. Upon an Exchange Offer by the Company in accordance with
Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii)
shall be deemed to have been satisfied upon receipt by the Registrar
of the instructions contained in the Letter of Transmittal delivered
by the Holder of such beneficial interests in the Restricted Global
Notes. Upon satisfaction of all of the requirements for transfer or
exchange of beneficial interests in Global Notes contained in this
Indenture, the Senior Notes and otherwise applicable under the
Securities Act, the Trustee shall adjust the principal amount of the
relevant Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted
Global Note. A beneficial interest in any Restricted Global Note may
be transferred to a Person who takes delivery thereof in the form of
a beneficial interest in the 144A Global Note or the Regulation S
Global Note if the transfer complies with the requirements of clause
(ii) above and the Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof.
A beneficial interest in the 144A Global Note or the Regulation S
Global Note may not be transferred to a Person who would be required
to take delivery thereof in the form of a beneficial interest in the
IAI Global Note.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Note for Beneficial Interests in the Unrestricted
Global Note. A beneficial interest in any Restricted Global Note may
be exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Note or transferred to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note if the exchange or transfer complies with
the requirements of clause (ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of the beneficial interest to be
transferred, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the
Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement;
or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof;
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof; and
(3) in each such case set forth in this subparagraph
(D), an Opinion of Counsel in form reasonably acceptable to the
Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
not required in order to maintain compliance with the Securities
Act.
If any such transfer is effected pursuant to subparagraph (B) or
(D) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, the
Trustee shall authenticate one or more Unrestricted Global Notes in
an aggregate principal amount equal to the principal amount of
beneficial interests transferred pursuant to subparagraph (B) or (D)
above.
Beneficial interests in an Unrestricted Global Note cannot be
exchanged for, or transferred to Persons who take delivery thereof in
the form of, a beneficial interest in a Restricted Global Note.
(c) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(i) If any holder of a beneficial interest in a Restricted Global
Note proposes to exchange such beneficial interest for a Definitive
Note or to transfer such beneficial interest to a Person who takes
delivery thereof in the form of a Definitive Note, then, upon receipt
by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note, a certificate from such holder in
the form of Exhibit C hereto, including, subject to Section
2.06(c)(ii) below, the certifications in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of
the Securities Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other
than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in
item (3)(b) thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit
B hereto, including the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.06(h) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions
a Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.06(c) shall be registered in
such name or names and in such authorized denomination or
denominations as the holder of such beneficial interest shall
instruct the Registrar through instructions from the Depositary and
the Participant or Indirect Participant. The Trustee shall deliver
such Definitive Notes to the Persons in whose names such Senior Notes
are so registered. Any Definitive Note issued in exchange for a
beneficial interest in a Restricted Global Note pursuant to this
Section 2.06(c)(i) shall bear the Private Placement Legend and shall
be subject to all restrictions on transfer contained therein.
(ii) Notwithstanding 2.06(c)(i) hereof, a holder of a beneficial
interest in a Restricted Global Note may exchange such beneficial
interest for an Unrestricted Definitive Note or may transfer such
beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the holder of such beneficial interest, in the case
of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not
(1) a broker-dealer, (2) a Person participating in the
distribution of the Exchange Notes or (3) a Person who is an
affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement;
or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such beneficial
interest for a Definitive Note that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof;
(2) if the holder of such beneficial interest in a
Restricted Global Note proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Definitive Note that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof; and
(3) in each such case set forth in this subparagraph
(D), an Opinion of Counsel in form reasonably acceptable to the
Company, to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are
not required in order to maintain compliance with the Securities
Act.
(iii) If any holder of a beneficial interest in an Unrestricted
Global Note proposes to exchange such beneficial interest for a
Definitive Note or to transfer such beneficial interest to a Person
who takes delivery thereof in the form of a Definitive Note, then,
upon satisfaction of the conditions set forth in Section 2.06(b)(ii)
hereof, the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.06(h) hereof, and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions
a Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest pursuant to this
Section 2.06(c)(iii) shall be registered in such name or names and in
such authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Registrar through instructions
from the Depositary and the Participant or Indirect Participant. The
Trustee shall deliver such Definitive Notes to the Persons in whose
names such Senior Notes are so registered. Any Definitive Note issued
in exchange for a beneficial interest pursuant to this Section
2.06(c)(iii) shall not bear the Private Placement Legend. A
beneficial interest in an Unrestricted Global Note cannot be
exchanged for a Definitive Note bearing the Private Placement Legend
or transferred to a Person who takes delivery thereof in the form of
a Definitive Note bearing the Private Placement Legend.
(d) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) If any Holder of a Restricted Definitive Note proposes to
exchange such Senior Note for a beneficial interest in a Restricted
Global Note or to transfer such Definitive Notes to a Person who
takes delivery thereof in the form of a beneficial interest in a
Restricted Global Note, then, upon receipt by the Registrar of the
following documentation:
(A) if the Holder of such Restricted Definitive Note
proposes to exchange such Senior Note for a beneficial interest
in a Restricted Global Note, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item (2)(b) thereof;
(B) if such Definitive Note is being transferred to a QIB
in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Definitive Note is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with
Rule 903 or Rule 904 under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Definitive Note is being transferred pursuant
to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(a) thereof;
(E) if such Definitive Note is being transferred to an
Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other
than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable;
(F) if such Definitive Note is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in
item (3)(b) thereof; or
(G) if such Definitive Note is being transferred pursuant
to an effective registration statement under the Securities Act,
a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Definitive Note, increase or cause to be
increased the aggregate principal amount of, in the case of clause
(A) above, the appropriate Restricted Global Note, in the case of
clause (B) above, the 144A Global Note, in the case of clause (C)
above, the Regulation S Global Note, and in all other cases, the IAI
Global Note.
(ii) A Holder of a Restricted Definitive Note may exchange such
Senior Note for a beneficial interest in an Unrestricted Global Note
or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement;
or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Senior Notes for a beneficial interest in the
Unrestricted Global Note, a certificate from such Holder in the
form of Exhibit C hereto, including the certifications in item
(1)(c) thereof;
(2) if the Holder of such Definitive Notes proposes to
transfer such Senior Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of
Exhibit B hereto, including the certifications in item (4)
thereof; and
(3) in each such case set forth in this subparagraph
(D), an Opinion of Counsel in form reasonably acceptable to the
Company to the effect that such exchange or transfer is in
compliance with the Securities Act, that the restrictions on
transfer contained herein and in the Private Placement Legend are
not required in order to maintain compliance with the Securities
Act, and such Definitive Notes are being exchanged or transferred
in compliance with any applicable blue sky securities laws of any
State of the United States.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 2.06(d)(ii), the Trustee shall cancel the Definitive
Notes and increase or cause to be increased the aggregate principal
amount of the Unrestricted Global Note.
(iii) A Holder of an Unrestricted Definitive Note may exchange
such Senior Note for a beneficial interest in an Unrestricted Global
Note or transfer such Definitive Notes to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted
Global Note at any time. Upon receipt of a request for such an
exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be increased
the aggregate principal amount of one of the Unrestricted Global
Notes.
If any such exchange or transfer from a Definitive Note to a
beneficial interest is effected pursuant to subparagraphs (ii)(B), (ii)(D)
or (iii) above at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.02 hereof, the Trustee shall
authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the principal amount of beneficial interests
transferred pursuant to subparagraphs (ii)(B), (ii)(D) or (iii) above.
(e) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's
compliance with the provisions of this Section 2.06(e), the Registrar shall
register the transfer or exchange of Definitive Notes. Prior to such
registration of transfer or exchange, the requesting Holder shall present
or surrender to the Registrar the Definitive Notes duly endorsed or
accompanied by a written instruction of transfer in form satisfactory to
the Registrar duly executed by such Holder or by his attorney, duly
authorized in writing. In addition, the requesting Holder shall provide any
additional certifications, documents and information, as applicable,
pursuant to the provisions of this Section 2.06(e).
(i) Restricted Definitive Notes may be transferred to and
registered in the name of Persons who take delivery thereof if the
Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A
under the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the
form of Exhibit B hereto, including the certifications in item
(2) thereof; and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities
Act, then the transferor must deliver (x) a certificate in the
form of Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof,
if applicable.
(ii) Any Restricted Definitive Note may be exchanged by the
Holder thereof for an Unrestricted Definitive Note or transferred to
a Person or Persons who take delivery thereof in the form of an
Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights
Agreement and the Holder, in the case of an exchange, or the
transferee, in the case of a transfer, certifies in the
applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as
defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) any such transfer is effected by a Participating
Broker-Dealer pursuant to the Exchange Offer Registration
Statement in accordance with the Registration Rights Agreement;
or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes
proposes to exchange such Senior Notes for an Unrestricted
Definitive Note, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(a)
thereof;
(2) if the Holder of such Restricted Definitive Notes
proposes to transfer such Senior Notes to a Person who shall take
delivery thereof in the form of an Unrestricted Definitive Note,
a certificate from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof; and
(3) in each such case set forth in this subparagraph
(D), an Opinion of Counsel in form reasonably acceptable to the
Company to the effect that such exchange or transfer is in
compliance with the Securities Act, that the restrictions on
transfer contained herein and in the Private Placement Legend are
not required in order to maintain compliance with the Securities
Act, and such Restricted Definitive Note is being exchanged or
transferred in compliance with any applicable blue sky securities
laws of any State of the United States.
(iii) A Holder of Unrestricted Definitive Notes may transfer such
Senior Notes to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note. Upon receipt of a request to register
such a transfer, the Registrar shall register the Unrestricted
Definitive Notes pursuant to the instructions from the Holder
thereof. Unrestricted Definitive Notes cannot be exchanged for or
transferred to Persons who take delivery thereof in the form of a
Restricted Definitive Note.
(f) Exchange Offer. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section
2.02, the Trustee shall authenticate (i) one or more Unrestricted Global
Notes in an aggregate principal amount equal to the principal amount of the
beneficial interests in the Restricted Global Notes tendered for acceptance
by Persons that certify in the applicable Letter of Transmittal that the
are not (x) broker-dealers, (y) Persons participating in the distribution
of the Exchange Notes or (z) Persons who are affiliates (as defined in Rule
144) of the Company and accepted for exchange in the exchange Offer and
(ii) Definitive Notes in an aggregate principal amount equal to the
principal amount of the Restricted Definitive Notes accepted for exchange
in the Exchange Offer. Concurrent with the issuance of such Senior Notes,
the Trustee shall cause the aggregate principal amount of the applicable
Restricted Global Notes to be reduced accordingly, and the Company shall
execute and the Trustee shall authenticate and deliver to the Persons
designated by the Holders of Definitive Notes so accepted Definitive Notes
in the appropriate principal amount.
(g) Legends. The following legends shall appear on the face of
all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this
Indenture.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (b) below, each
Global Note and each Definitive Note (and all Senior Notes issued
in exchange therefor or substitution thereof) shall bear the
legend in substantially the following form:
"THIS SENIOR NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SENIOR
NOTE MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR IN
ACCORDANCE WITH AN APPLICABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT (SUBJECT TO THE DELIVERY OF SUCH EVIDENCE IF ANY, REQUIRED
UNDER THE INDENTURE PURSUANT TO WHICH THIS SENIOR NOTE IS ISSUED)
AND IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION."
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to subparagraphs (b)(iv),
(c)(ii)-(iii), (d)(ii)-(iii), (e)(ii)-(iii) or (f) to this
Section 2.06 (and all Senior Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement
Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE
TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE
MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE
INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY."
(h) Cancellation and/or Adjustment of Global Notes. At such time
as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed,
repurchased or canceled in whole and not in part, each such Global Note
shall be returned to or retained and canceled by the Trustee in accordance
with Section 2.11 hereof. At any time prior to such cancellation, if any
beneficial interest in a Global Note is exchanged for or transferred to a
Person who will take delivery thereof in the form of a beneficial interest
in another Global Note or for Definitive Notes, the principal amount of
Senior Notes represented by such Global Note shall be reduced accordingly
and an endorsement shall be made on such Global Note, by the Trustee or by
the Depositary at the direction of the Trustee, to reflect such reduction;
and if the beneficial interest is being exchanged for or transferred to a
Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased
accordingly and an endorsement shall be made on such Global Note, by the
Trustee or by the Depositary at the direction of the Trustee, to reflect
such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global Notes
and Definitive Notes upon the Company's order or at the Registrar's
request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any
such transfer taxes or similar governmental charge payable upon
exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.10,
4.15 and 9.05 hereof).
(iii) The Registrar shall not be required to register the
transfer of or exchange any Senior Note selected for redemption in
whole or in part, except the unredeemed portion of any Senior Note
being redeemed in part.
(iv) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive
Notes shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as
the Global Notes or Definitive Notes surrendered upon such
registration of transfer or exchange.
(v) The Company shall not be required (A) to issue, to register
the transfer of or to exchange any Senior Notes during a period
beginning at the opening of business 15 days before the day of any
selection of Senior Notes for redemption under Section 3.02 hereof
and ending at the close of business on the day of selection, (B) to
register the transfer of or to exchange any Senior Note so selected
for redemption in whole or in part, except the unredeemed portion of
any Senior Note being redeemed in part or (C) to register the
transfer of or to exchange a Senior Note between a record date and
the next succeeding Interest Payment Date.
(vi) Prior to due presentment for the registration of a transfer
of any Senior Note, the Trustee, any Agent and the Company may deem
and treat the Person in whose name any Senior Note is registered as
the absolute owner of such Senior Note for the purpose of receiving
payment of principal of and interest on such Senior Notes and for all
other purposes, and none of the Trustee, any Agent or the Company
shall be affected by notice to the contrary.
(vii) The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.02 hereof.
(viii) All certifications, certificates and Opinions of Counsel
required to be submitted to the Registrar pursuant to this Section
2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.
SECTION 2.07. REPLACEMENT SENIOR NOTES.
If any mutilated Senior Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Senior Note, the Company shall issue and
the Trustee, upon the written order of the Company signed by two Officers
of the Company, shall authenticate a replacement Senior Note if the
Trustee's requirements are met. If required by the Trustee or the Company,
an indemnity bond must be supplied by the Holder that is sufficient in the
judgment of the Trustee and the Company to protect the Company, the
Trustee, any Agent and any authenticating agent from any loss that any of
them may suffer if a Senior Note is replaced. The Company may charge for
its expenses in replacing a Senior Note.
Every replacement Senior Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture
equally and proportionately with all other Senior Notes duly issued
hereunder.
SECTION 2.08. OUTSTANDING SENIOR NOTES.
The Senior Notes outstanding at any time are all the Senior Notes
authenticated by the Trustee except for those canceled by it, those
delivered to it for cancellation, those reductions in the interest in a
Global Note effected by the Trustee in accordance with the provisions
hereof, and those described in this Section as not outstanding. Except as
set forth in Section 2.09 hereof, a Senior Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the
Senior Note.
If a Senior Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to
it that the replaced Senior Note is held by a bona fide purchaser.
If the principal amount of any Senior Note is considered paid
under Section 4.01 hereof, it ceases to be outstanding and interest on it
ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date,
money sufficient to pay Senior Notes payable on that date, then on and
after that date such Senior Notes shall be deemed to be no longer
outstanding and shall cease to accrue interest.
SECTION 2.09. TREASURY SENIOR NOTES.
In determining whether the Holders of the required principal
amount of Senior Notes have concurred in any direction, waiver or consent,
Senior Notes owned by the Company, or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control
with the Company, shall be considered as though 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 Senior Notes that
a Responsible Officer of the Trustee knows are so owned shall be so
disregarded.
SECTION 2.10. TEMPORARY SENIOR NOTES.
Until certificates representing the Senior Notes are ready for
delivery, the Company may prepare and the Trustee shall authenticate
temporary Senior Notes upon a written order of the Company signed by two
Officers of the Company. Temporary Senior Notes shall be substantially in
the form of certificated Senior Notes but may have variations that the
Company considers appropriate for temporary Senior Notes and as shall be
reasonably acceptable to the Trustee. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate Definitive Notes
in exchange for temporary Senior Notes. Until so exchanged, Holders of
temporary Senior Notes shall be entitled to all of the benefits of this
Indenture.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Senior Notes to the Trustee
for cancellation. The Registrar and Paying Agent shall forward to the
Trustee any Senior Notes surrendered to them for registration of transfer,
exchange or payment. The Trustee and no one else shall cancel all Senior
Notes surrendered for registration of transfer, exchange, payment,
replacement or cancellation and shall destroy canceled Senior Notes
(subject to the record retention requirement of the Exchange Act) unless
the Company directs the Trustee to return such Senior Notes to the Company.
Certification of the destruction of all canceled Senior Notes shall be
delivered to the Company. The Company may not issue new Senior Notes to
replace Senior Notes that it has paid or that have been delivered to the
Trustee for cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Senior
Notes, it shall pay the defaulted interest in any lawful manner plus, to
the extent lawful, interest payable on the defaulted interest, to the
Persons who are Holders on a subsequent special record date, in each case
at the rate provided in the Senior Notes and in Section 4.01 hereof. The
Company shall notify the Trustee in writing of the amount of defaulted
interest proposed to be paid on each Senior Note and the date of the
proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record
date shall be less than 10 days prior to the related payment date for such
defaulted interest. At least 15 days before the special record date, the
Company (or, upon the written request of the Company, the Trustee in the
name and at the expense of the Company) shall mail or cause to be mailed to
Holders a notice that states the special record date, the related payment
date and the amount of such interest to be paid.
ARTICLE 3
REDEMPTION AND PREPAYMENT
SECTION 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Senior Notes pursuant to the
optional redemption provisions of Section 3.07 hereof, it shall furnish to
the Trustee, at least 30 days but not more than 60 days before a redemption
date, an Officers' Certificate setting forth (i) the clause of this
Indenture pursuant to which the redemption shall occur, (ii) the redemption
date, (iii) the principal amount of Senior Notes to be redeemed and (iv)
the redemption price.
SECTION 3.02. SELECTION OF SENIOR NOTES TO BE REDEEMED.
If less than all of the Senior Notes are to be redeemed or
purchased in an offer to purchase at any time, selection of Senior Notes
for redemption or purchase shall be made by the Trustee in compliance with
the requirements of the principal national securities exchange, if any, on
which the Senior Notes are listed, or, if the Senior Notes are not so
listed, on a pro rata basis or (inasmuch as a precise pro rata selection
may not be possible in light of the last clause of this Section 3.02) by
such other method as the Trustee shall deem fair and appropriate; provided
that no Senior Notes of $1,000 or less shall be redeemed or purchased in
part.
SECTION 3.03. NOTICE OF REDEMPTION.
Subject to the provisions of Section 3.09 hereof, at least 30
days but not more than 60 days before a redemption date, the Company shall
mail or cause to be mailed, by first class mail, a notice of redemption to
each Holder whose Senior Notes are to be redeemed at its registered
address.
The notice shall identify the Senior Notes to be redeemed and
shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Senior Note is being redeemed in part, the portion of
the principal amount of such Senior Note to be redeemed and that,
after the redemption date upon surrender of such Senior Note, a new
Senior Note or Senior Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original
Senior Note;
(d) the name and address of the Paying Agent;
(e) that Senior Notes called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest on Senior Notes called for redemption ceases to
accrue on and after the redemption date;
(g) the paragraph of the Senior Notes and/or Section of this
Indenture pursuant to which the Senior Notes called for redemption
are being redeemed; and
(h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or
printed on the Senior Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however,
that the Company shall have delivered to the Trustee, at least 45 days
prior to the redemption date (unless the Trustee consents to a shorter
notice period), an Officers' Certificate requesting that the Trustee give
such notice and setting forth the information to be stated in such notice
as provided in the preceding paragraph.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section
3.03 hereof, Senior Notes called for redemption become irrevocably due and
payable on the redemption date at the redemption price. A notice of
redemption may not be conditional.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
One Business Day prior to the redemption date, the Company shall
deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued interest on all Senior Notes to be
redeemed on that date. The Trustee or the Paying Agent shall promptly
return to the Company any money deposited with the Trustee or the Paying
Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued interest on, all Senior Notes to be
redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest shall cease to accrue
on the Senior Notes or the portions of Senior Notes called for redemption.
If a Senior Note is redeemed on or after an interest record date but on or
prior to the related interest payment date, then any accrued and unpaid
interest shall be paid to the Person in whose name such Senior Note was
registered at the close of business on such record date. If any Senior Note
called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Company to comply with the preceding
paragraph, interest shall be paid on the unpaid principal, from the
redemption date until such principal is paid, and to the extent lawful on
any interest not paid on such unpaid principal, in each case at the rate
provided in the Senior Notes and in Section 4.01 hereof.
SECTION 3.06. SENIOR NOTES REDEEMED IN PART.
Upon surrender of a Senior Note that is redeemed in part, the
Company shall issue and, upon the Company's written request, the Trustee
shall authenticate for the Holder at the expense of the Company a new
Senior Note equal in principal amount to the unredeemed portion of the
Senior Note surrendered.
SECTION 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 3.07, the
Senior Notes shall not be redeemable at the Company's option prior to July
15, 2002. Thereafter, the Senior Notes shall be subject to redemption at
any time at the option of the Company, in whole or in part, upon not less
than 30 nor more than 60 days' notice, at the redemption prices (expressed
as percentages of principal amount) set forth below plus accrued and unpaid
interest and Liquidated Damages thereon to the applicable redemption date,
if redeemed during the twelve-month period beginning on July 15 of the
years indicated below:
Year Percentage
2002....................................... 105.25%
2003....................................... 103.50%
2004....................................... 101.75%
2005 and thereafter ....................... 100.00%
(b) Notwithstanding the provisions of clause (a) of this Section
3.07, at any time on or before July 15, 2000, the Company may (but shall
not have the obligation to) redeem, on one or more occasions, up to 35% of
the aggregate principal amount of the Senior Notes at a redemption price
equal to 110 1/2% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the redemption date,
with the net cash proceeds of one or more Equity Offerings; provided that
at least $75.0 million aggregate principal amount of Senior Notes remain
outstanding immediately after the occurrence of such redemption; and
provided further, that such redemption shall occur within 45 days of the
date of the closing of such Equity Offering.
(c) Any redemption pursuant to this Section 3.07 shall be made
pursuant to the provisions of Section 3.01 through 3.06 hereof.
SECTION 3.08. MANDATORY REDEMPTION.
Except as set forth under Sections 4.10 and 4.15 hereof, the
Company shall not be required to make mandatory redemption payments or
sinking fund payments with respect to the Senior Notes.
SECTION 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
In the event that, pursuant to Section 4.10 hereof, the Company
shall be required to commence an offer to all Holders to purchase Senior
Notes (an "Asset Sale Offer"), it shall follow the procedures specified
below.
The Asset Sale Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the
extent that a longer period is required by applicable law (the "Offer
Period"). No later than five Business Days after the termination of the
Offer Period (the "Purchase Date"), the Company shall purchase the
principal amount of Senior Notes required to be purchased pursuant to
Section 4.10 hereof (the "Offer Amount") or, if less than the Offer Amount
has been tendered, all Senior Notes tendered in response to the Asset Sale
Offer. Payment for any Senior Notes so purchased shall be made in the same
manner as interest payments are made.
If the Purchase Date is on or after an interest record date and
on or before the related interest payment date, any accrued and unpaid
interest shall be paid to the Person in whose name a Senior Note is
registered at the close of business on such record date, and no additional
interest shall be payable to Holders who tender Senior Notes pursuant to
the Asset Sale Offer.
Upon the commencement of an Asset Sale Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders,
with a copy to the Trustee. The notice shall contain all instructions and
materials necessary to enable such Holders to tender Senior Notes pursuant
to the Asset Sale Offer. The Asset Sale Offer shall be made to all Holders.
The notice, which shall govern the terms of the Asset Sale Offer, shall
state:
(a) that the Asset Sale Offer is being made pursuant to this
Section 3.09 and Section 4.10 hereof and the length of time the Asset
Sale Offer shall remain open;
(b) the Offer Amount, the purchase price and the Purchase Date;
(c) that any Senior Note not tendered or accepted for payment
shall continue to accrue interest;
(d) that, unless the Company defaults in making such payment, any
Senior Note accepted for payment pursuant to the Asset Sale Offer
shall cease to accrue interest after the Purchase Date;
(e) that Holders electing to have a Senior Note purchased
pursuant to an Asset Sale Offer may only elect to have all of such
Senior Note purchased and may not elect to have only a portion of
such Senior Note purchased;
(f) that Holders electing to have a Senior Note purchased
pursuant to any Asset Sale Offer shall be required to surrender the
Senior Note, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Senior Note completed, or transfer by
book-entry transfer, to the Company, a depositary, if appointed by
the Company, or a Paying Agent at the address specified in the notice
at least three days before the Purchase Date;
(g) that Holders shall be entitled to withdraw their election if
the Company, the depositary or the Paying Agent, as the case may be,
receives, not later than the expiration of the Offer Period, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Senior Note the
Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Senior Note purchased;
(h) that, if the aggregate principal amount of Senior Notes
surrendered by Holders exceeds the Offer Amount, the Company shall
select the Senior Notes to be purchased on a pro rata basis (with
such adjustments as may be deemed appropriate by the Company so that
only Senior Notes in denominations of $1,000, or integral multiples
thereof, shall be purchased); and
(i) that Holders whose Senior Notes were purchased only in part
shall be issued new Senior Notes equal in principal amount to the
unpurchased portion of the Senior Notes surrendered (or transferred
by book-entry transfer).
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary,
the Offer Amount of Senior Notes or portions thereof tendered pursuant to
the Asset Sale Offer, or if less than the Offer Amount has been tendered,
all Senior Notes tendered, and shall deliver to the Trustee an Officers'
Certificate stating that such Senior Notes or portions thereof were
accepted for payment by the Company in accordance with the terms of this
Section 3.09. The Company, the Depositary or the Paying Agent, as the case
may be, shall promptly (but in any case not later than five days after the
Purchase Date) mail or deliver to each tendering Holder an amount equal to
the purchase price of the Senior Notes tendered by such Holder and accepted
by the Company for purchase, and the Company shall promptly issue a new
Senior Note, and the Trustee, upon written request from the Company, shall
authenticate and mail or deliver such new Senior Note to such Holder, in a
principal amount equal to any unpurchased portion of the Senior Note
surrendered. Any Senior Note not so accepted shall be promptly mailed or
delivered by the Company to the Holder thereof. The Company shall publicly
announce the results of the Asset Sale Offer on the Purchase Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the
provisions of Sections 3.01 through 3.06 hereof.
ARTICLE 4
COVENANTS
SECTION 4.01. PAYMENT OF SENIOR NOTES.
The Company shall pay or cause to be paid the principal of,
premium, if any, and interest on the Senior Notes on the dates and in the
manner provided in the Senior Notes. Principal, premium, if any, and
interest shall be considered paid on the date due if the Paying Agent, if
other than the Company or a Subsidiary thereof, holds as of 10:00 a.m.
Eastern Time on the due date money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal,
premium, if any, and interest then due. The Company shall pay all
Liquidated Damages, if any, in the same manner on the dates and in the
amounts set forth in the Registration Rights Agreement.
The Company shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue principal at the
rate equal to 1% per annum in excess of the then applicable interest rate
on the Senior Notes to the extent lawful; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest and Liquidated Damages (without regard to
any applicable grace period) at the same rate to the extent lawful.
SECTION 4.02. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, the City
of New York, an office or agency (which may be an office of the Trustee or
an Affiliate of the Trustee, Registrar or co-registrar) where Senior Notes
may be surrendered for registration of transfer or for exchange and where
notices and demands to or upon the Company in respect of the Senior Notes
and this Indenture may be served. The Company shall give prompt written
notice to the Trustee of the location, and any change in the location, of
such office or agency. If at any time the Company shall fail to maintain
any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more
other offices or agencies where the Senior Notes may be presented or
surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in the Borough of Manhattan, the City of New
York for such purposes. The Company shall give prompt written notice to the
Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the
Trustee as one such office or agency of the Company in accordance with
Section 2.03.
SECTION 4.03. REPORTS.
(a) Whether or not required by the rules and regulations of the
SEC, so long as any Senior Notes are outstanding, the Company shall furnish
to the Holders of Senior Notes (i) all quarterly and annual financial
information that would be required to be contained in a filing with the SEC
on Forms 10-Q and 10-K if the Company were required to file such Forms,
including a "Management's Discussion and Analysis of Financial Condition
and Results of Operations" that describes the financial condition and
results of operations of the Company and its consolidated Subsidiaries
(showing in reasonable detail, either on the face of the financial
statements or in the footnotes thereto and in Management's Discussion and
Analysis of Financial Condition and Results of Operations, the financial
condition and results of operations of the Company and its Restricted
Subsidiaries separate from the financial condition and results of
operations of the Unrestricted Subsidiaries of the Company) and, with
respect to the annual information only, a report thereon by the Company's
certified independent accountants and (ii) all current reports that would
be required to be filed with the SEC on Form 8-K if the Company were
required to file such reports.
(b) Whether or not required by the rules and regulations of the
SEC, at any time after the Company files the Exchange Offer Registration
Statement, the Company shall file a copy of all such information and
reports with the SEC for public availability (unless the SEC shall not
accept such a filing) and make such information available to securities
analysts and prospective investors upon request.
(c) The Company and the Guarantors have agreed that, for so long
as any Senior Notes remain outstanding, they shall furnish to the Holders
and to securities analysts and prospective investors, upon their request,
the information required to be delivered pursuant to Rule 144A(d)(4) under
the Securities Act.
SECTION 4.04. COMPLIANCE CERTIFICATE.
(a) The Company [and each Guarantor] shall deliver to the
Trustee, within 90 days after the end of each fiscal year, an Officers'
Certificate stating that a review of the activities of the Company and its
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Company has kept, observed, performed and fulfilled its obligations under
this Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge the Company has kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he or she may have knowledge and what action the
Company is taking or proposes to take with respect thereto) and that to the
best of his or her knowledge no event has occurred and remains in existence
by reason of which payments on account of the principal of or interest, if
any, on the Senior Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes
to take with respect thereto.
(b) So long as not contrary to the then current recommendations
of the American Institute of Certified Public Accountants, the year-end
financial statements delivered pursuant to Section 4.03(a) above shall be
accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that
in making the examination necessary for certification of such financial
statements, nothing has come to their attention that would lead them to
believe that the Company has violated any provisions of Article 4 or
Article 5 hereof or, if any such violation has occurred, specifying the
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for
any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Senior Notes are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming
aware of any Default or Event of Default, an Officers' Certificate
specifying such Default or Event of Default and what action the Company is
taking or proposes to take with respect thereto.
SECTION 4.05. TAXES.
The Company shall pay, and shall cause each of its Subsidiaries
to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Senior Notes.
SECTION 4.06. STAY, EXTENSION AND USURY LAWS.
Each of the Company and the Guarantors 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, extension or usury law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of
this Indenture; and each of the Company and the Guarantors (to the extent
that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to
any such law, hinder, delay or impede the execution of any power herein
granted to the Trustee, but shall suffer and permit the execution of every
such power as though no such law has been enacted.
SECTION 4.07. RESTRICTED PAYMENTS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend or
make any other payment or distribution on account of the Company's or any
of its Restricted Subsidiaries' Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation
involving the Company) or to the direct or indirect holders of the
Company's or any of its Restricted Subsidiaries' Equity Interests in their
capacity as such (other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company), provided that
each Restricted Subsidiary of the Company will be permitted to declare and
pay dividends to the holders of such Restricted Subsidiary's common Equity
Interests on a pro rata basis; (ii) purchase, redeem or otherwise acquire
or retire for value (including, without limitation, in connection with any
merger or consolidation involving the Company) any Equity Interests of the
Company, any Restricted Subsidiary of the Company or any Affiliate of the
Company (other than any such Equity Interests owned by the Company or any
Restricted Subsidiary of the Company); (iii) make any payment on or with
respect to, or purchase, redeem, defease or otherwise acquire or retire for
value, any Indebtedness that is subordinated to the Senior Notes, except
(x) a payment of interest or principal at Stated Maturity or (y) pursuant
to a change of control provision applicable to such subordinated
Indebtedness, provided that the Company has complied with the terms of
Section 4.15 hereof and has paid, or has made adequate provision in the
reasonable judgment of the Board of Directors for the payment of, the
Senior Notes that have been or may be tendered in response to a Change of
Control Offer; or (iv) make any Restricted Investment (all such payments
and other actions set forth in clauses (i) through (iv) above being
collectively referred to as "Restricted Payments"), unless, at the time of
and after giving effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(b) the Company would, at the time of such Restricted Payment and
after giving pro forma effect thereto as if such Restricted Payment had
been made at the beginning of the applicable four-quarter period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to
the Fixed Charge Coverage Ratio test set forth in the first paragraph of
Section 4.09 hereof; and
(c) such Restricted Payment, together with the aggregate amount
of all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date of this Indenture (including all Restricted
Payments permitted by the next succeeding paragraph but excluding
Restricted Payments permitted by clauses (ii), (iii) and (vi) of the next
succeeding paragraph), is less than the sum of (i) 50% of the Consolidated
Net Income of the Company for the period (taken as one accounting period)
from the beginning of the first fiscal quarter commencing after the date of
this Indenture to the end of the Company's most recently ended fiscal
quarter for which internal financial statements are available at the time
of such Restricted Payment (or, if such Consolidated Net Income for such
period is a deficit, less 100% of such deficit), plus (ii) 100% of the
aggregate net cash proceeds received by the Company from the issue or sale
since the date of this Indenture of Equity Interests of the Company (other
than Disqualified Stock) or of Disqualified Stock or debt securities of the
Company that have been converted into such Equity Interests (other than
Equity Interests (or Disqualified Stock or convertible debt securities)
sold to a Subsidiary of the Company and other than Disqualified Stock or
convertible debt securities that have been converted into Disqualified
Stock), plus (iii) to the extent that any Restricted Investment that was
made after the date of this Indenture is sold for cash or otherwise
liquidated or repaid for cash, the lesser of (A) the cash return of capital
with respect to such Restricted Investment (less the cost of disposition,
if any) and (B) the initial amount of such Restricted Investment and (C)
the amount resulting from redesignations of Unrestricted Subsidiaries as
Restricted Subsidiaries (in each case, such amount to be valued as provided
in the second succeeding paragraph) not to exceed the amount of Investments
previously made by the Company or any Restricted Subsidiary in such
Unrestricted Subsidiary and which was treated as a Restricted Payment under
this Indenture.
The foregoing provisions shall not prohibit (i) the payment of
any dividend within 60 days after the date of declaration thereof, if at
said date of declaration such payment would have complied with the
provisions of this Indenture; (ii) the redemption, repurchase, retirement,
defeasance or other acquisition of any subordinated Indebtedness or Equity
Interests of the Company in exchange for, or out of the net cash proceeds
of the substantially concurrent sale (other than to a Restricted Subsidiary
of the Company) of, other Equity Interests of the Company (other than any
Disqualified Stock); provided that the amount of any such net cash proceeds
that are utilized for any such redemption, repurchase, retirement,
defeasance or other acquisition shall be excluded from clause (c)(ii) of
the preceding paragraph; (iii) the defeasance, redemption, repurchase or
other acquisition of pari passu or subordinated Indebtedness with the net
cash proceeds from an incurrence of Permitted Refinancing Indebtedness;
(iv) the repurchase, redemption or other acquisition or retirement for
value of any Equity Interests of the Company or any Restricted Subsidiary
of the Company held by any member of the Company's (or any of its
Restricted Subsidiaries') management, employees or consultants pursuant to
any management, employee or consultant equity subscription agreement or
stock option agreement; provided that the aggregate price paid for all such
repurchased, redeemed, acquired or retired Equity Interests shall not
exceed $500,000 in any twelve-month period and no Default or Event of
Default shall have occurred and be continuing immediately after such
transaction; (v) cash payments in lieu of fractional shares issuable as
dividends on preferred securities of the Company or any of its Restricted
Subsidiaries; provided that such cash payments shall not exceed $50,000 in
the aggregate in any twelve-month period and no Default or Event of Default
shall have occurred and be continuing immediately after such transaction;
and (vi) payments pursuant to the Varsity Merger Documents.
The Board of Directors may designate any Restricted Subsidiary to
be an Unrestricted Subsidiary if such designation would not cause a
Default; provided that in no event shall the business currently operated by
Xxxxxxx, Inc. and Varsity be transferred to or held by an Unrestricted
Subsidiary. For purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to the
extent repaid in cash) in the Subsidiary so designated shall be deemed to
be Restricted Payments at the time of such designation and shall reduce the
amount available for Restricted Payments under the first paragraph of this
Section 4.07 hereof. All such outstanding Investments shall be deemed to
constitute Investments in an amount equal to the greatest of (x) the net
book value of such Investments at the time of such designation and (y) the
fair market value of such Investments at the time of such designation. Such
designation shall only be permitted if such Restricted Payment would be
permitted at such time and if such Restricted Subsidiary otherwise meets
the definition of an Unrestricted Subsidiary. Any such designation by the
Board of Directors shall be evidenced to the Trustee by filing with the
Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the foregoing conditions and was permitted by the provisions
of Section 4.07. If, at any time, any Unrestricted Subsidiary would fail to
meet the foregoing requirements as an Unrestricted Subsidiary, it shall
thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary shall be deemed to be
incurred by a Restricted Subsidiary of the Company as of such date (and, if
such Indebtedness is not permitted to be incurred as of such date under
Section 4.09 hereof the Company shall be in default of such covenant). The
Board of Directors of the Company may at any time designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that such
designation shall be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of
such Unrestricted Subsidiary and such designation shall only be permitted
if (i) such Indebtedness is permitted under Section 4.09 hereof calculated
on a pro forma basis as if such designation had occurred at the beginning
of the four-quarter reference period, and (ii) no Default or Event of
Default would be in existence following such designation.
In computing the Consolidated Net Income of the Company under the
foregoing clause (c)(i), (i) the Company may use audited financial
statements for the portions of the relevant period for which audited
financial statements are available on the date of determination and
unaudited financial statements and other current financial data based on
the books and records of the Company for the remaining portion of such
period and (ii) the Company shall be permitted to rely in good faith on the
financial statements and other financial data derived from its books and
records that are available on the date of determination. If the Company
makes a Restricted Payment that, at the time of the making of such
Restricted Payment, would in the good faith determination of the Company be
permitted under the requirements of this Indenture, such Restricted Payment
shall be deemed to have been made in compliance with this Indenture
notwithstanding any subsequent adjustments made in good faith to the
Company's financial statements affecting Consolidated Net Income of the
Company for any period.
The amount of all Restricted Payments (other than cash) shall be
the fair market value on the date of the Restricted Payment of the asset(s)
or securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment. The fair market value of any non-cash Restricted Payment shall be
determined by the Board of Directors whose resolution with respect thereto
shall be delivered to the Trustee, such determination to be based upon an
opinion or appraisal issued by an accounting, appraisal or investment
banking firm of national standing if such fair market value exceeds $5.0
million. Not later than the date of making any Restricted Payment, the
Company shall deliver to the Trustee an Officers' Certificate stating that
such Restricted Payment is permitted and setting forth the basis upon which
the calculations required by this Section 4.07 hereof were computed,
together with a copy of any fairness opinion or appraisal required by this
Indenture.
SECTION 4.08. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary to (i)(a) pay dividends or make any
other distributions to the Company or any of its Restricted Subsidiaries
(1) on its Capital Stock or (2) with respect to any other interest or
participation in, or measured by, its profits, or (b) pay any indebtedness
owed to the Company or any of its Restricted Subsidiaries, (ii) make loans
or advances to the Company or any of its Restricted Subsidiaries or (iii)
transfer any of its properties or assets to the Company or any of its
Restricted Subsidiaries, except for such encumbrances or restrictions
existing under or by reason of (a) Existing Indebtedness as in effect on
the date of this Indenture, (b) the New Credit Facility as in effect as of
the date of this Indenture, and any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings thereof, provided that such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement or
refinancings are no more restrictive with respect to such dividend and
other payment restrictions than those contained in the New Credit Facility
as in effect on the date of this Indenture, (c) this Indenture and the
Senior Notes, (d) applicable law, (e) any instrument governing Indebtedness
or Capital Stock of a 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), which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any Person,
other than the Person, or the property or assets of the Person, so
acquired, provided that, in the case of Indebtedness, such Indebtedness was
permitted by the terms of this Indenture to be incurred, (f) by reason of
customary non-assignment provisions in leases, licenses, encumbrances,
contracts or similar assets entered into or acquired in the ordinary course
of business and consistent with past practices, (g) purchase money
obligations for property acquired in the ordinary course of business that
impose restrictions of the nature described in clause (iii) above on the
property so acquired, (h) Permitted Refinancing Indebtedness, provided that
the restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are no more restrictive than those contained in
the agreements governing the Indebtedness being refinanced or (i)
restrictions contained in agreements for the sale or disposition of assets
or of all of the capital stock of Subsidiaries that are otherwise in
compliance with the terms of this Indenture to the extent such agreements
contain restrictions with respect to assets or the Subsidiary sold or
disposed of thereunder.
SECTION 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable, contingently
or otherwise, with respect to (collectively, "incur") any Indebtedness
(including Acquired Debt) and the Company shall not issue any Disqualified
Stock and shall not permit any of its Subsidiaries to issue any shares of
preferred stock (except that a Subsidiary of the Company may issue
preferred stock to the Company or to any Guarantor); provided, however,
that the Company or the Guarantors may incur Indebtedness (including
Acquired Debt) or issue shares of Disqualified Stock if the Fixed Charge
Coverage Ratio for the Company's most recently ended four full fiscal
quarters for which internal financial statements are available immediately
preceding the date on which such additional Indebtedness is incurred or
such Disqualified Stock is issued would have been at least 2.0 to 1, if
such incurrence or issuance is on or prior to September 30, 1999, or 2.25
to 1, if such incurrence or issuance is after September 30, 1999, in each
case, determined on a pro forma basis (including a pro forma application of
the net proceeds therefrom), as if the additional Indebtedness had been
incurred, or the Disqualified Stock had been issued, as the case may be, at
the beginning of such four-quarter period.
The Company shall not incur any Indebtedness that is
contractually subordinated to any other Indebtedness of the Company unless
such Indebtedness is also contractually subordinated to the Senior Notes on
substantially identical terms; provided, however, that no Indebtedness of
the Company shall be deemed to be contractually subordinated to any other
Indebtedness of the Company solely by virtue of being unsecured.
The provisions of the first paragraph of this Section 4.09 shall
not apply to the incurrence of any of the following items of Indebtedness
(collectively, "Permitted Debt"):
(i) the incurrence by the Company and the Guarantors of
Indebtedness (including letters of credit) pursuant to the Credit
Facilities (with letters of credit being deemed to have a principal amount
equal to the maximum potential liability of the Company and the Guarantors
thereunder) outstanding under all Credit Facilities after giving effect to
such incurrence, including all Permitted Refinancing Indebtedness incurred
to refinance or replace any Indebtedness incurred pursuant to this clause
(i), does not exceed the greater of (a) $40.0 million or (b) the amount of
the Borrowing Base minus Indebtedness incurred pursuant to clause (iv) of
this Section 4.09;
(ii) the incurrence by the Company and the Guarantors of the
Existing Indebtedness;
(iii) the incurrence by the Company and the Guarantors of
Indebtedness represented by the Senior Notes (other than any Additional
Senior Notes) and the Subsidiary Guarantees;
(iv) the incurrence by the Company or any of the Guarantors of
Indebtedness in an aggregate principal amount not to exceed $3.0 million at
any time outstanding (x) incurred in connection with the settlement of, or
the payment of any judgment with respect to, any outstanding litigation in
existence as of the date of this Indenture, which may include the payment
of legal fees and expenses relating to such litigation, or (y) represented
by Capital Lease Obligations, mortgage financings or purchase money
obligations, in each case incurred for the purpose of financing all or any
part of the purchase price or cost of construction or improvement of
property, plant or equipment used in the business of the Company or such
Guarantor; provided, however, that any indebtedness incurred pursuant to
clause (x) shall have been incurred no later than 18 months after the date
of this Indenture.
(v) the incurrence by the Company or any of the Guarantors of
Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
which are used to refund, refinance or replace Indebtedness that was
permitted by this Indenture to be incurred;
(vi) the incurrence by the Company or any of the Guarantors of
intercompany Indebtedness between or among the Company and any of the
Guarantors; provided, however, that (A) any subsequent issuance or transfer
of Equity Interests that results in any such Indebtedness being held by a
Person other than the Company or a Guarantor and (B) any sale or other
transfer of any such Indebtedness to a Person that is not either the
Company or a Guarantor shall be deemed, in each case, to constitute an
incurrence of such Indebtedness by the Company or such Guarantor, as the
case may be;
(vii) the incurrence by the Company or any of the Guarantors of
Hedging Obligations that are incurred for the purpose of fixing or hedging
currency exchange risk or interest rate risk with respect to any floating
rate Indebtedness that is permitted by the terms of this Indenture to be
outstanding;
(viii) the incurrence by the Company's Unrestricted Subsidiaries
of Non-Recourse Debt, provided, however, that if any such Indebtedness
ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, such event
shall be deemed to constitute an incurrence of Indebtedness by a Restricted
Subsidiary of the Company;
(ix) Indebtedness incurred in respect of performance, surety and
similar bonds provided by the Company in the ordinary course of business,
and refinancings thereof;
(x) Indebtedness arising from guarantees of Indebtedness of the
Company or any Subsidiary or other agreements of the Company or a
Subsidiary providing for indemnification, adjustment of purchase price or
similar obligations, in each case, incurred or assumed 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 all such Indebtedness shall at no time exceed the gross proceeds
actually received by the Company and its Subsidiaries in connection with
such disposition;
(xi) the guarantee by any of the Guarantors of Indebtedness of
the Company or another Guarantor that was permitted to be incurred under
this Indenture; and
(xii) the incurrence by the Company or any of its Subsidiaries of
additional Indebtedness in an aggregate principal amount (or accreted
value, as applicable) at any time outstanding, not to exceed $10.0 million.
For purposes of determining compliance with this Section 4.09, in
the event that an item of Indebtedness meets the criteria of more than one
of the categories of Permitted Debt described in clauses (i) through (xii)
above or is entitled to be incurred pursuant to the first paragraph of this
Section 4.09, the Company shall, in its sole discretion, classify such item
of Indebtedness in any manner that complies with this Section 4.09 and such
item of Indebtedness shall be treated as having been incurred pursuant to
only one of such clauses or pursuant to the first paragraph hereof. Accrual
of interest and the accretion of accreted value shall not be deemed to be
an incurrence of Indebtedness for purposes of this Section 4.09.
SECTION 4.10. ASSET SALES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Company (or the
Restricted Subsidiary, as the case may be) receives consideration at the
time of such Asset Sale at least equal to the fair market value (evidenced
by a resolution of the Board of Directors set forth in an Officers'
Certificate delivered to the Trustee) of the assets or Equity Interests
issued or sold or otherwise disposed of and (ii) for any Asset Sale other
than an Asset Sale of Unrestricted Margin Stock at least 75% of the
consideration therefor received by the Company or such Restricted
Subsidiary is in the form of cash or Cash Equivalents; provided that the
amount of (x) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet), of the Company or any Restricted
Subsidiary (other than contingent liabilities and liabilities that are by
their terms subordinated to the Senior Notes or any guarantee thereof) that
are assumed by the transferee of any such assets pursuant to a customary
novation agreement that releases the Company or such Restricted Subsidiary
from further liability and (y) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary from such
transferee that are promptly converted by the Company or such Restricted
Subsidiary into cash (to the extent of the cash received), shall be deemed
to be cash for purposes of this provision.
Within 270 days after the receipt of any Net Proceeds from an
Asset Sale other than an Asset Sale of Unrestricted Margin Stock, the
Company may apply such Net Proceeds, at its option, (a) to permanently
reduce Indebtedness under the Credit Facilities (and correspondingly reduce
commitments thereunder) or to permanently reduce other Senior Indebtedness
of the Company or any Guarantor or (b) to the acquisition of a controlling
interest in a Permitted Business, the making of a capital expenditure or
the acquisition of other long-term assets (collectively "Replacement
Assets"). Pending the final application of any such Net Proceeds, the
Company may temporarily reduce revolving credit Indebtedness or otherwise
invest such Net Proceeds in any manner that is not prohibited by this
Indenture. Any Net Proceeds from Asset Sales, other than an Asset Sale of
Unrestricted Margin Stock, that are not applied or invested as provided in
the first sentence of this paragraph shall be deemed to constitute "Excess
Proceeds." When the aggregate amount of Excess Proceeds exceeds $5.0
million, the Company shall be required to make an Asset Sale Offer to all
Holders of Senior Notes and Additional Senior Notes to purchase the maximum
principal amount of Senior Notes and Additional Senior Notes that may be
purchased out of the Excess Proceeds, at an offer price in cash in an
amount equal to 100% of the principal amount thereof plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the date of
purchase, in accordance with the procedures set forth in Section 3.09 of
this Indenture. To the extent that the aggregate amount of Senior Notes and
Additional Senior Notes tendered pursuant to an Asset Sale Offer is less
than or equal to the Excess Proceeds, the Company (or such Subsidiary) may
use any remaining Excess Proceeds for general corporate purposes. If the
aggregate principal amount of Senior Notes and Additional Senior Notes
surrendered by Holders thereof exceeds the amount of Excess Proceeds, the
Trustee shall select the Senior Notes and Additional Senior Notes to be
purchased on a pro rata basis. Upon completion of such offer to purchase,
the amount of Excess Proceeds shall be reset at zero.
SECTION 4.11. TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each of the foregoing, an "Affiliate
Transaction"), unless (i) such Affiliate Transaction is on terms that are
no less favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary with an unrelated Person and (ii) the
Company delivers to the Trustee (a) with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $500,000, a resolution of the Board of Directors
set forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with clause (i) above and that such Affiliate
Transaction has been approved by a majority of the disinterested members of
the Board of Directors and (b) with respect to any Affiliate Transaction or
series of related Affiliate Transactions involving aggregate consideration
in excess of $5.0 million, an opinion as to the fairness to the Holders of
such Affiliate Transaction from a financial point of view issued by an
accounting, appraisal or investment banking firm of national standing;
provided that (w) any employment agreement entered into by the Company or
any of its Restricted Subsidiaries consistent with the past practice of the
Company or such Restricted Subsidiary, or any employee benefit plan
available to employees or senior executives of the Company or any
Restricted Subsidiary generally, in each case in the ordinary course of
business, (x) transactions between or among the Company and/or its
Restricted Subsidiaries, (y) dividends, distributions, Restricted Payments
and Investments that are permitted by Section 4.07 hereof and (z) any
transactions pursuant to the Varsity Merger Documents, in each case, shall
not be deemed Affiliate Transactions.
SECTION 4.12. LIENS.
The Company shall not, and shall not permit any of its
Subsidiaries to, 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, except Permitted Liens.
SECTION 4.13. LINE OF BUSINESS.
The Company shall, and shall cause the Guarantors to, engage only
in Permitted Businesses.
SECTION 4.14. CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect (i)
its corporate existence, and the corporate, partnership or other existence
of each of its Subsidiaries, in accordance with the respective organ-
izational documents (as the same may be amended from time to time) of the
Company or any such Subsidiary and (ii) the rights (charter and statutory),
licenses and franchises of the Company and its Subsidiaries; provided,
however, that the Company shall not be required to preserve any such right,
license or franchise, or the corporate, partnership or other existence of
any of its Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business
of the Company and its Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Senior
Notes.
SECTION 4.15. OFFER TO REPURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder of
Senior Notes shall have the right to require the Company to repurchase all
or any part (equal to $1,000 or an integral multiple thereof) of such
Holder's Senior Notes pursuant to the offer described below (the "Change of
Control Offer") at an offer price in cash equal to 101% of the aggregate
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the date of purchase (the "Change of Control
Payment"). Within 30 days following any Change of Control, the Company
shall mail a notice to each Holder describing the transaction or
transactions that constitute the Change of Control and offering to
repurchase Senior Notes on the date specified in such notice, which date
shall be no earlier than 30 days and no later than 60 days from the date
such notice is mailed (the "Change of Control Payment Date"), pursuant to
the procedures required by this Indenture and described in such notice. The
Company shall 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 repurchase
of the Senior Notes as a result of a Change of Control.
(b) On the Change of Control Payment Date, the Company shall, to
the extent lawful, (1) accept for payment all Senior Notes or portions
thereof properly tendered pursuant to the Change of Control Offer, (2)
deposit with the Paying Agent an amount equal to the Change of Control
Payment in respect of all Senior Notes or portions thereof so tendered and
(3) deliver or cause to be delivered to the Trustee the Senior Notes so
accepted together with an Officers' Certificate stating the aggregate
principal amount of Senior Notes or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to each Holder of Senior
Notes so tendered the Change of Control Payment for such Senior Notes, and
the Trustee shall promptly authenticate and mail (or cause to be
transferred by book entry) to each Holder a new Senior Note equal in
principal amount to any unpurchased portion of the Senior Notes
surrendered, if any; provided that each such new Senior Note shall be in a
principal amount of $1,000 or an integral multiple thereof. The Company
shall publicly announce the results of the Change of Control Offer on or as
soon as practicable after the Change of Control Payment Date.
(c) The Change of Control provisions described in subsections (a)
and (b) of this Section 4.15 shall be applicable whether or not any other
provisions of this Indenture are applicable.
(d) The Company shall not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Indenture applicable to a Change of Control
Offer made by the Company and purchases all Senior Notes validly tendered
and not withdrawn under such Change of Control Offer.
SECTION 4.16. LIMITATION ON ISSUANCES AND SALES OF CAPITAL STOCK OF WHOLLY
OWNED RESTRICTED SUBSIDIARIES.
The Company (i) shall not, and shall not permit any Restricted
Subsidiary of the Company to, transfer, convey, sell, lease or otherwise
dispose of any Capital Stock of any Restricted Subsidiary of the Company to
any Person (other than the Company or a Wholly Owned Restricted Subsidiary
of the Company), unless (a) such transfer, conveyance, sale, lease or other
disposition is of all the Capital Stock of such Restricted Subsidiary and
(b) the cash Net Proceeds from such transfer, conveyance, sale, lease or
other disposition are applied in accordance with Section 4.10 hereof and
(ii) shall not permit any Restricted Subsidiary of the Company to issue any
of its Equity Interests (other than, if necessary, shares of its Capital
Stock constituting directors' qualifying shares) to any Person other than
to the Company or a Guarantor.
SECTION 4.17. ADDITIONAL SUBSIDIARY GUARANTEES
If the Company or any of its Subsidiaries shall acquire or create
another Subsidiary after the date of this Indenture, then such newly
acquired or created Subsidiary shall execute a Subsidiary Guarantee in the
form of a Supplemental Indenture and deliver an opinion of counsel, in
accordance with the terms of this Indenture, except for (i) all
Subsidiaries that have properly been designated as Unrestricted
Subsidiaries in accordance with this Indenture for so long as they continue
to constitute Unrestricted Subsidiaries and (ii) all Subsidiaries organized
outside of the United States and its territories. The form of such
Subsidiary Guarantee is attached as Exhibit F hereto.
SECTION 4.18. PAYMENTS FOR CONSENT.
Neither the Company nor any of its Subsidiaries shall, directly
or indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Senior Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Senior Notes unless such consideration
is offered to be paid or is paid to all Holders of the Senior Notes that
consent, waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or agreement.
ARTICLE 5
SUCCESSORS
SECTION 5.01. MERGER, CONSOLIDATION, OR SALE OF ASSETS.
The Company may not consolidate or merge with or into (whether or
not the Company is the surviving corporation), or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of its
properties or assets in one or more related transactions, to another
corporation, Person or entity unless (i) the Company is the surviving
corporation or the entity or the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made is a corporation organized or existing under the laws of the
United States, any state thereof or the District of Columbia; (ii) the
entity or Person formed by or surviving any such consolidation or merger
(if other than the Company) or the entity or Person to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made assumes all the obligations of the Company under the Senior Notes
and this Indenture pursuant to a supplemental indenture in a form
reasonably satisfactory to the Trustee; (iii) immediately after such
transaction no Default or Event of Default exists; (iv) except in the case
of a merger of the Company with or into a Wholly Owned Restricted
Subsidiary of the Company, the Company or the entity or Person formed by or
surviving any such consolidation or merger (if other than the Company), or
to which such sale, assignment, transfer, lease, conveyance or other
disposition shall have been made will, at the time of such transaction and
after giving pro forma effect thereto as if such transaction had occurred
at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed
Charge Coverage Ratio test set forth in the first paragraph of Section 4.09
hereof and (v) the Company has 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 such supplemental indenture complies with this
Article and that all conditions precedent herein provided for relating to
such transaction have been complied with.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, assignment,
transfer, lease, conveyance or other disposition of all or substantially
all of the assets of the Company in accordance with Section 5.01 hereof,
the successor corporation formed by such consolidation or into or with
which the Company is merged or to which such sale, assignment, transfer,
lease, conveyance or other disposition is made shall succeed to, and be
substituted for (so that from and after the date of such consolidation,
merger, sale, lease, conveyance or other disposition, the provisions of
this Indenture referring to the "Company" shall refer instead to the
successor corporation and not to the Company), and may exercise every right
and power of the Company under this Indenture with the same effect as if
such successor Person had been named as the Company herein; provided,
however, that the predecessor Company shall not be relieved from the
obligation to pay the principal of and interest on the Senior Notes except
in the case of a sale of all of the Company's assets that meets the
requirements of Section 5.01 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Company defaults for 30 days in the payment when due of
interest on, or Liquidated Damages with respect to, the Senior Notes;
(b) the Company defaults in payment when due of the principal of
or premium, if any, on the Senior Notes;
(c) the Company fails to comply with Sections 4.07, 4.09, 4.10 or
4.15;
(d) the Company fails for 60 days after notice to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least
25% of the Senior Notes (including Additional Senior Notes, if any) voting
as a single class, then outstanding to comply with any of its other
agreements in this Indenture or the Senior Notes;
(e) there is a default under any mortgage, indenture or
instrument under which there may be issued or by which there may be secured
or evidenced any Indebtedness for money borrowed by the Company or any of
its Restricted Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries) whether such Indebtedness or
guarantee now exists, or is created after the date of this Indenture, which
default (a) is caused by a failure to pay principal of or premium, if any,
or interest on such Indebtedness prior to the expiration of the grace
period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness
prior to its express maturity and, in each case, the principal amount of
any such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates $5.0 million or more;
(f) the Company or any of its Restricted Subsidiaries fails to
pay final judgments aggregating in excess of $5.0 million, which judgments
are not paid, discharged or stayed for a period of 60 days;
(g) the Company or any of its Significant Restricted Subsidiaries
or any group of Subsidiaries that, taken as a whole, would constitute a
Significant Restricted Subsidiary pursuant to or within the meaning of
Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it
in an involuntary case,
(iii) consents to the appointment of a custodian of it or
for all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) generally is not paying its debts as they become due; or
(h) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(i) is for relief against the Company or any of its
Significant Restricted Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a
Significant Restricted Subsidiary in an involuntary case;
(ii) appoints a custodian of the Company or any of its
Significant Restricted Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a
Significant Restricted Subsidiary or for all or
substantially all of the property of the Company or any of
its Significant Restricted Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a
Significant Restricted Subsidiary; or
(iii) orders the liquidation of the Company or any of its
Significant Restricted Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a
Significant Restricted Subsidiary;
and the order or decree remains unstayed and in effect for
60 consecutive days; or
(i) except as permitted by this Indenture, any Subsidiary
Guarantee is held in any judicial proceeding to be unenforceable or invalid
or shall cease for any reason to be in full force and effect or any
Guarantor, or any Person acting on behalf of any Guarantor, shall deny or
disaffirm its obligations under its Subsidiary Guarantee.
SECTION 6.02. ACCELERATION.
If any Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in principal amount of the then outstanding
Senior Notes and Additional Senior Notes, if any (voting as a single
class), may declare all the Senior Notes to be due and payable immediately,
by written notice to the Company (and to the Trustee if given by the
Holders). Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, with respect to
the Company or any Guarantor constituting a Significant Restricted
Subsidiary, all outstanding Senior Notes shall become due and payable
without further action or notice. Upon any such declaration, the Senior
Notes shall become due and payable immediately. Notwithstanding the
foregoing, if an Event of Default specified in clause (g) or (h) of Section
6.01 hereof occurs with respect to the Company, any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary, all outstanding Senior Notes shall be
due and payable immediately without further action or notice. The Holders
of a majority in aggregate principal amount of the then outstanding Senior
Notes by written notice to the Trustee may on behalf of all of the Holders
rescind an acceleration and its consequences if the rescission would not
conflict with any judgment or decree and if all existing Events of Default
(except nonpayment of principal, interest or premium that has become due
solely because of the acceleration) have been cured or waived.
If an Event of Default occurs on or after July 15, 2002 by reason
of any willful action (or inaction) taken (or not taken) by or on behalf of
the Company with the intention of avoiding payment of the premium that the
Company would have had to pay if the Company then had elected to redeem the
Senior Notes pursuant to Section 3.07 hereof, then, upon acceleration of
the Senior Notes, an equivalent premium shall also become and be
immediately due and payable, to the extent permitted by law, anything in
this Indenture or in the Senior Notes to the contrary notwithstanding. If
an Event of Default occurs prior to July 15, 2002 by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Company
with the intention of avoiding the prohibition on redemption of the Senior
Notes prior to such date, then, upon acceleration of the Senior Notes, an
additional premium shall also become and be immediately due and payable in
an amount, for each of the years beginning on July 15 of the years set
forth below, as set forth below:
Year Percentage
1997........................................ 113.50%
1998........................................ 112.25%
1999........................................ 110.50%
2000........................................ 108.75%
2001........................................ 107.00%
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium,
if any, and interest on the Senior Notes or to enforce the performance of
any provision of the Senior Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Senior Notes or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Holder of a Senior Note in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default. All remedies are cumulative to the extent permitted by
law.
SECTION 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount
of the then outstanding Senior Notes (including any Additional Senior
Notes) by notice to the Trustee may on behalf of the Holders of all of the
Senior Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in
the payment of the principal of, premium and Liquidated Damages, if any, or
interest on, the Senior Notes (including in connection with an offer to
purchase) (provided, however, that the Holders of a majority in aggregate
principal amount of the then outstanding Senior Notes may rescind an
acceleration and its consequences, including any related payment default
that resulted from such acceleration). Upon any such waiver, such Default
shall cease to exist, and any Event of Default arising therefrom shall be
deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
SECTION 6.05. CONTROL BY MAJORITY.
Holders of a majority in principal amount of the then outstanding
Senior Notes may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising
any trust or power conferred on it. However, the Trustee may refuse to
follow any direction that conflicts with law or this Indenture that the
Trustee determines may be unduly prejudicial to the rights of other Holders
of Senior Notes or that may involve the Trustee in personal liability.
Notwithstanding any provision to the contrary in this Indenture, the
Trustee shall not be obligated to take any action with respect to the
provisions of the last paragraph of Section 6.02 hereof unless directed to
do so pursuant to this Section 6.05.
SECTION 6.06. LIMITATION ON SUITS.
A Holder of a Senior Note may pursue a remedy with respect to
this Indenture or the Senior Notes only if:
(a) the Holder of a Senior Note gives to the Trustee written
notice of a continuing Event of Default;
(b) the Holders of at least 25% in principal amount of the then
outstanding Senior Notes make a written request to the Trustee to
pursue the remedy;
(c) such Holder of a Senior Note or Holders of Senior Notes offer
and, if requested, provide to the Trustee indemnity satisfactory to
the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer and, if requested, the
provision of indemnity; and
(e) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Senior Notes do not give the
Trustee a direction inconsistent with the request.
A Holder of a Senior Note may not use this Indenture to prejudice the
rights of another Holder of a Senior Note or to obtain a preference or
priority over another Holder of a Senior Note.
SECTION 6.07. RIGHTS OF HOLDERS OF SENIOR NOTES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right
of any Holder of a Senior Note to receive payment of principal, premium and
Liquidated Damages, if any, and interest on the Senior Note, on or after
the respective due dates expressed in the Senior Note (including in
connection with an offer to purchase), or to bring suit for the enforcement
of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(a) or (b) occurs
and is continuing, the Trustee is authorized to recover judgment in its own
name and as trustee of an express trust against the Company for the whole
amount of principal of, premium and Liquidated Damages, if any, and
interest remaining unpaid on the Senior Notes and interest on overdue
principal and, to the extent lawful, interest and such further amount as
shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel) and the Holders of the Senior Notes allowed in any judicial
proceedings relative to the Company (or any other obligor upon the Senior
Notes), its creditors or its property and shall be entitled and empowered
to collect, receive and distribute any money or other property payable or
deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due
to it for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07 hereof. To the extent that the payment of any
such compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under Section
7.07 hereof out of the estate in any such proceeding, shall be denied for
any reason, payment of the same shall be secured by a Lien on, and shall be
paid out of, any and all distributions, dividends, money, securities and
other properties that the Holders may be entitled to receive in such
proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Senior Notes or the rights of any Holder, or to
authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it
shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation, expense
and liabilities incurred, and all advances made, by the Trustee and the
costs and expenses of collection;
Second: to Holders of Senior Notes for amounts due and unpaid on
the Senior Notes for principal, premium and Liquidated Damages, if any, and
interest, ratably, without preference or priority of any kind, according to
the amounts due and payable on the Senior Notes for principal, premium and
Liquidated Damages, if any and interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders of Senior Notes pursuant to this Section 6.10.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the
filing by any party litigant in the suit of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. This Section does not apply to a suit
by the Trustee, a suit by a Holder of a Senior Note pursuant to Section
6.07 hereof, or a suit by Holders of more than 10% in principal amount of
the then outstanding Senior Notes.
ARTICLE 7
TRUSTEE
SECTION 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent man 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 duties of the Trustee shall be determined solely by the
express provisions of this Indenture and the Trustee need perform
only those duties that are specifically set forth in this Indenture
and no others, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to
the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and
(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 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision
of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of the rights or powers vested in it by
this Indenture at the request or direction of any of the Holders pursuant
to the provisions of this Indenture, including, without limitation, the
provisions of Section 6.05 hereof, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses
and liabilities that might be incurred by it in compliance with such
request or direction.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(g) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture or other paper or documents, but the Trustee, in its
discretion may make such further inquiry or investigation into such facts
or matters as it may see fit, and, if the Trustee shall determine to make
such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company or any Guarantor, personally or
by agent or attorney.
SECTION 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon any document believed
by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. 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.
The Trustee may consult with counsel and the written advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient
if signed by an Officer of the Company.
(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 or
direction of any of the Holders unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses
and liabilities that might be incurred by it in compliance with such
request or direction.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Senior Notes and may otherwise deal with the
Company or any Affiliate of the Company with the same rights it would have
if it were not Trustee. However, in the event that the Trustee acquires any
conflicting interest it must eliminate such conflict within 90 days, apply
to the SEC for permission to continue as trustee or resign. Any Agent may
do the same with like rights and duties. The Trustee is also subject to
Sections 7.10 and 7.11 hereof.
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
Senior Notes, it shall not be accountable for the Company's use of the
proceeds from the Senior Notes or any money paid to the Company or upon the
Company's direction under any provision of this Indenture, it shall not be
responsible for the use or application of any money received by any Paying
Agent other than the Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Senior Notes or any
other document in connection with the sale of the Senior Notes or pursuant
to this Indenture other than its certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if
it is known to the Trustee, the Trustee shall mail to Holders of Senior
Notes a notice of the Default or Event of Default within 90 days after it
occurs. Except in the case of a Default or Event of Default in payment of
principal of, premium, if any, or interest on any Senior Note, the Trustee
may withhold the notice if and so long as a committee of its Responsible
Officers in good faith determines that withholding the notice is in the
interests of the Holders of the Senior Notes.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS OF THE SENIOR NOTES.
Within 60 days after each May 15 beginning with the May 15
following the date of this Indenture, and for so long as Senior Notes
remain outstanding, the Trustee shall mail to the Holders of the Senior
Notes a brief report dated as of such reporting date that complies with TIA
ss. 313(a) (but if no event described in TIA ss. 313(a) has occurred within
the twelve months preceding the reporting date, no report need be
transmitted). The Trustee also shall comply with TIA ss. 313(b)(2). The
Trustee shall also transmit by mail all reports as required by TIA ss.
313(c).
A copy of each report at the time of its mailing to the Holders
of Senior Notes shall be mailed to the Company and filed with the SEC and
each stock exchange on which the Senior Notes are listed in accordance with
TIA ss. 313(d). The Company shall promptly notify the Trustee when the
Senior Notes are listed on any stock exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder.
The Trustee's compensation shall not be limited by any law on compensation
of a trustee of an express trust. The Company shall reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation,
disbursements and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all
losses, liabilities or expenses incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture
against the Company (including this Section 7.07) and defending itself
against any claim (whether asserted by the Company or any Holder or any
other Person) or liability in connection with the exercise or performance
of any of its powers or duties hereunder, except to the extent any such
loss, liability or expense may be attributable to its negligence or bad
faith. The Trustee shall notify the Company promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so notify the Company
shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable
fees and expenses of such counsel. The Company need not pay for any
settlement made without its consent, which consent shall not be
unreasonably withheld.
The obligations of the Company under this Section 7.07 shall
survive the resignation or removal of the Trustee and the satisfaction and
discharge of this Indenture.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Senior Notes on all money or
property held or collected by the Trustee, except that held in trust to pay
principal and interest on particular Senior Notes. Such Lien shall survive
the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(g) or (h) hereof occurs, the
expenses and the compensation for the services (including the fees and
expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2)
to the extent applicable.
SECTION 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time and be discharged
from the trust hereby created by so notifying the Company. The Holders of
Senior Notes of a majority in principal amount of the then outstanding
Senior Notes may remove the Trustee by so notifying the Trustee and the
Company in writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or
its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes
office, the Holders of a majority in principal amount of the then
outstanding Senior Notes may appoint a successor Trustee to replace the
successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of Senior Notes of at least 10% in principal amount
of the then outstanding Senior Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Senior
Note who has been a Holder of a Senior Note for at least six months, fails
to comply with Section 7.10, such Holder of a Senior Note may petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, 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 a notice of
its succession to Holders of the Senior Notes. The retiring Trustee shall
promptly transfer all property held by it as Trustee to the successor
Trustee, provided all sums owing to the Trustee hereunder have been paid
and subject to the Lien provided for in Section 7.07 hereof.
Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to,
another corporation, the successor corporation without any further act
shall be the successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United
States of America or of any state thereof that is authorized under such
laws to exercise corporate trustee power, that is subject to supervision or
examination by federal or state authorities and that has a combined capital
and surplus of at least $100 million as set forth in its most recent
published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to
TIA ss. 310(b).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA ss. 311(a), excluding anY creditor
relationship listed in TIA ss. 311(b). A Trustee who haS resigned or been
removed shall be subject to TIA ss. 311(a) to thE extent indicated therein.
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors
evidenced by a resolution set forth in an Officers' Certificate, at any
time, elect to have either Section 8.02 or 8.03 hereof be applied to all
outstanding Senior Notes upon compliance with the conditions set forth
below in this Article Eight.
SECTION 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.02, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be deemed
to have been discharged from its obligations with respect to all
outstanding Senior Notes on the date the conditions set forth below are
satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal
Defeasance means that the Company shall be deemed to have paid and
discharged the entire Indebtedness represented by the outstanding Senior
Notes, which shall thereafter be deemed to be "outstanding" only for the
purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Senior Notes and this Indenture (and the Trustee, on
demand of and at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following provisions
which shall survive until otherwise terminated or discharged hereunder: (a)
the rights of Holders of outstanding Senior Notes to receive solely from
the trust fund described in Section 8.04 hereof, and as more fully set
forth in such Section, payments in respect of the principal of, premium, if
any, and interest on such Senior Notes when such payments are due, (b) the
Company's obligations with respect to such Senior Notes under Article 2 and
Section 4.02 hereof, (c) the rights, powers, trusts, duties and immunities
of the Trustee hereunder and the Company's obligations in connection
therewith and (d) this Article Eight. Subject to compliance with this
Article Eight, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.
SECTION 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.03, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be
released from its obligations under the covenants contained in Sections
4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.15, 4.16 and 4.17 hereof with
respect to the outstanding Senior Notes on and after the date the
conditions set forth in Section 8.04 below are satisfied (hereinafter,
"Covenant Defeasance"), and the Senior Notes shall thereafter be deemed not
"outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that
such Senior Notes shall not be deemed outstanding for accounting purposes).
For this purpose, Covenant Defeasance means that, with respect to the
outstanding Senior Notes, the Company may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth
in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any
reference in any such covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01 hereof, but, except as specified
above, the remainder of this Indenture and such Senior Notes shall be
unaffected thereby. In addition, upon the Company's exercise under Section
8.01 hereof of the option applicable to this Section 8.03 hereof, subject
to the satisfaction of the conditions set forth in Section 8.04 hereof,
Sections 6.01(d) through 6.01(f) hereof shall not constitute Events of
Default.
SECTION 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of
either Section 8.02 or 8.03 hereof to the outstanding Senior Notes:
In order to exercise either Legal Defeasance or Covenant
Defeasance:
(a) the Company must irrevocably deposit with the Trustee,
in trust, for the benefit of the Holders of the Senior Notes,
cash in U.S. dollars, non-callable Government Securities, or a
combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and
interest and Liquidated Damages on the outstanding Senior Notes
on the stated maturity or on the applicable redemption date, as
the case may be, and the Company must specify whether the Senior
Notes are being defeased to maturity or to a particular
redemption date;
(b) in the case of an election under Section 8.02 hereof,
the Company shall have delivered to the Trustee an Opinion of
Counsel in the United States reasonably acceptable to the Trustee
confirming that (A) the Company has received from, or there has
been published by, the Internal Revenue Service a ruling or (B)
since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect
that, and based thereon such opinion of counsel shall confirm
that, the Holders of the outstanding Senior Notes shall not
recognize income, gain or loss for federal income tax purposes as
a result of such Legal Defeasance and shall be subject to federal
income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance
had not occurred;
(c) in the case of an election under Section 8.03 hereof,
the Company shall have delivered to the Trustee an opinion of
counsel in the United States reasonably acceptable to the Trustee
confirming that the Holders of the outstanding Senior Notes shall
not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and shall be
subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and
be continuing on the date of such deposit (other than a Default
or Event of Default resulting from the incurrence of Indebtedness
all or a portion of the proceeds of which will be used to defease
the Senior Notes pursuant to this Article Eight concurrently with
such incurrence) or insofar as Sections 6.01(g) or 6.01(h) hereof
is concerned, at any time in the period ending on the 91st day
after the date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default
under, any material agreement or instrument (other than this
Indenture) to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries is
bound;
(f) the Company shall have delivered to the Trustee an
opinion of counsel to the effect that on 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;
(g) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by
the Company with the intent of preferring the Holders over any
other creditors of the Company or with the intent of defeating,
hindering, delaying or defrauding any other creditors of the
Company; and
(h) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating
that all conditions precedent provided for or relating to the
Legal Defeasance or the Covenant Defeasance have been complied
with.
SECTION 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE
HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, all money and non-callable
Government Securities (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee, collectively for purposes of this
Section 8.05, the "Trustee") pursuant to Section 8.04 hereof in respect of
the outstanding Senior Notes shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Senior Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as Paying Agent) as the Trustee may
determine, to the Holders of such Senior Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest,
but such money need not be segregated from other funds except to the extent
required by law.
The Company shall pay and indemnify the Trustee against any tax,
fee or other charge imposed on or assessed against the cash or non-callable
Government Securities deposited pursuant to Section 8.04 hereof or the
principal and interest received in respect thereof other than any such tax,
fee or other charge which by law is for the account of the Holders of the
outstanding Senior Notes.
Anything in this Article Eight to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any money or non-callable Government Securities held
by it as provided in Section 8.04 hereof which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the
opinion delivered under Section 8.04(a) hereof), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium,
if any, or interest on any Senior Note and remaining unclaimed for two
years after such principal, and premium, if any, or interest has become due
and payable shall be paid to the Company on its request or (if then held by
the Company) shall be discharged from such trust; and the Holder of such
Senior Note shall thereafter, as a secured creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that
the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in
the New York Times and The Wall Street Journal (national edition), notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such notification or
publication, any unclaimed balance of such money then remaining will be
repaid to the Company.
SECTION 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United
States dollars or non-callable Government Securities in accordance with
Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Company's obligations
under this Indenture and the Senior Notes shall be revived and reinstated
as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof
until such time as the Trustee or Paying Agent is permitted to apply all
such money in accordance with Section 8.02 or 8.03 hereof, as the case may
be; provided, however, that, if the Company makes any payment of principal
of, premium, if any, or interest on any Senior Note following the
reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Senior Notes to receive such payment from the
money held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.01. WITHOUT CONSENT OF HOLDERS OF SENIOR NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture, the
Subsidiary Guarantees or the Senior Notes without the consent of any Holder
of a Senior Note:
(a) to cure any ambiguity, defect or inconsistency,
(b) to provide for uncertificated Senior Notes in addition to or
in place of certificated Senior Notes;
(c) to provide for the assumption of the Company's or a
Guarantor's obligations to Holders of Senior Notes in the case of a
merger or consolidation pursuant to Article 5 or Article 10 hereof;
(d) to provide for the issuance of Additional Senior Notes in
accordance with the limitations set forth in this Indenture on the
Issue Date;
(e) to make any change that would provide any additional rights
or benefits to the Holders of Senior Notes or that does not adversely
affect the legal rights under this Indenture of any such Holder;
(f) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the Trust
Indenture Act; or
(g) to allow any Guarantor to execute a supplemental indenture
and/or a Subsidiary Guarantee with respect to the Senior Notes.
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company
and the Guarantors in the execution of any amended or supplemental
Indenture authorized or permitted by the terms of this Indenture and to
make any further appropriate agreements and stipulations that may be
therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties
or immunities under this Indenture or otherwise.
SECTION 9.02. WITH CONSENT OF HOLDERS OF SENIOR NOTES.
Except as provided below in this Section 9.02, the Company and
the Trustee may amend or supplement this Indenture (including Sections
3.09, 4.10 and 4.15 hereof) and the Senior Notes may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the Senior Notes (including Additional Senior Notes, if
any) then outstanding voting as a single class (including, without
limitation, consents obtained in connection with a purchase of or a tender
offer or exchange offer for the Senior Notes), and, subject to Sections
6.04 and 6.07 hereof, any existing Default or Event of Default (other than
a Default or Event of Default in the payment of the principal of, premium,
if any, or interest on the Senior Notes, except a payment default resulting
from an acceleration that has been rescinded) or compliance with any
provision of this Indenture, the Subsidiary Guarantees or the Senior Notes
may be waived with the consent of the Holders of a majority in principal
amount of the then outstanding Senior Notes (including Additional Senior
Notes, if any) voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for the Senior Notes).
Upon the request of the Company accompanied by a resolution of
its Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Senior Notes
as aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee shall join with the Company in the
execution of such amended or supplemental Indenture unless such amended or
supplemental Indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may
in its discretion, but shall not be obligated to, enter into such amended
or supplemental Indenture.
It shall not be necessary for the consent of the Holders of
Senior Notes under this Section 9.02 to approve the particular form of any
proposed amendment or waiver, but it shall be sufficient if such consent
approves the substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders of Senior Notes
affected thereby a notice briefly describing the amendment, supplement or
waiver. Any failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of
any such amended or supplemental Indenture or waiver. Subject to Sections
6.04 and 6.07 hereof, the Holders of a majority in aggregate principal
amount of the Senior Notes (including Additional Senior Notes, if any) then
outstanding voting as a single class may waive compliance in a particular
instance by the Company with any provision of this Indenture or the Senior
Notes. However, without the consent of each Holder affected, an amendment
or waiver may not (with respect to any Senior Notes held by a
non-consenting Holder):
(a) reduce the principal amount of Senior Notes whose Holders
must consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any
Senior Note or alter the provisions with respect to the redemption of
the Senior Notes (other than provisions relating to Section 4.10 or
4.15 hereof);
(c) reduce the rate of or change the time for payment of interest
on any Senior Note;
(d) waive a Default or Event of Default in the payment of
principal of or premium, if any, or interest on the Senior Notes
(except a rescission of acceleration of the Senior Notes by the
Holders of at least a majority in aggregate principal amount of the
Senior Notes (including Additional Senior Notes, if any) and a waiver
of the payment default that resulted from such acceleration);
(e) make any Senior Note payable in money other than that stated
in the Senior Notes;
(f) make any change in the provisions of this Indenture relating
to waivers of past Defaults or the rights of Holders of Senior Notes
to receive payments of principal of or premium, if any, or interest
on the Senior Notes;
(g) waive a redemption payment with respect to any Senior Note
(other than a payment required by Section 4.10 or 4.15 hereof);
(h) release any Guarantor from any of its obligations under its
Subsidiary Guarantee or this Indenture, except in accordance with the
terms of this Indenture; or
(i) make any change in Section 6.04 or 6.07 hereof or in the
foregoing amendment and waiver provisions.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Senior
Notes shall be set forth in a amended or supplemental Indenture that
complies with the TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder of a Senior Note is a continuing consent by the
Holder of a Senior Note and every subsequent Holder of a Senior Note or
portion of a Senior Note that evidences the same debt as the consenting
Holder's Senior Note, even if notation of the consent is not made on any
Senior Note. However, any such Holder of a Senior Note or subsequent Holder
of a Senior Note may revoke the consent as to its Senior Note if the
Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. An amendment, supplement or
waiver becomes effective in accordance with its terms and thereafter binds
every Holder.
SECTION 9.05. NOTATION ON OR EXCHANGE OF SENIOR NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Senior Note thereafter authenticated. The
Company in exchange for all Senior Notes may issue and the Trustee shall,
upon receipt of an Authentication Order, authenticate new Senior Notes that
reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Senior
Note shall not affect the validity and effect of such amendment, supplement
or waiver.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does
not adversely affect the rights, duties, liabilities or immunities of the
Trustee. The Company may not sign an amendment or supplemental Indenture
until the Board of Directors approves it. In executing any amended or
supplemental indenture, the Trustee shall be entitled to receive and
(subject to Section 7.01 hereof) shall be fully protected in relying upon,
in addition to the documents required by Section 11.04, an Officer's
Certificate and an Opinion of Counsel stating that the execution of such
amended or supplemental indenture is authorized or permitted by this
Indenture.
ARTICLE 10
SUBSIDIARY GUARANTEES
Section 10.01. SUBSIDIARY GUARANTEES.
Subject to this Article 10, each of the Guarantors hereby,
jointly and severally, unconditionally guarantees to each Holder of a
Senior Note authenticated and delivered by the Trustee and to the Trustee
and its successors and assigns, irrespective of the validity and
enforceability of this Indenture, the Senior Notes or the obligations of
the Company hereunder or thereunder, that: (a) the principal of and
interest on the Senior Notes will be promptly paid in full when due,
whether at maturity, by acceleration, redemption or otherwise, and interest
on the overdue principal of and interest on the Senior Notes, if any, if
lawful, and all other obligations of the Company to the Holders or the
Trustee hereunder or thereunder will be promptly paid in full or performed,
all in accordance with the terms hereof and thereof; and (b) in case of any
extension of time of payment or renewal of any Senior Notes or any of such
other obligations, that same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether
at stated maturity, by acceleration or otherwise. Failing payment when due
of any amount so guaranteed or any performance so guaranteed for whatever
reason, the Guarantors shall be jointly and severally obligated to pay the
same immediately.
The Guarantors hereby agree that their obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Senior Notes or this Indenture, the absence of any
action to enforce the same, any waiver or consent by any Holder of the
Senior Notes with respect to any provisions hereof or thereof, the recovery
of any judgment against the Company, any action to enforce the same or any
other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a guarantor. Each Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in
the event of insolvency or bankruptcy of the Company, any right to require
a proceeding first against the Company, protest, notice and all demands
whatsoever and covenant that this Subsidiary Guarantee shall not be
discharged except by complete performance of the obligations contained in
the Senior Notes and this Indenture.
If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors or any custodian,
Trustee, liquidator or other similar official acting in relation to either
the Company or the Guarantors, any amount paid by either to the Trustee or
such Holder, this Subsidiary Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect.
Each Guarantor agrees that it shall not be entitled to any right
of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed
hereby. Each Guarantor further agrees that, as between the Guarantors, on
the one hand, and the Holders and the Trustee, on the other hand, (x) the
maturity of the obligations guaranteed hereby may be accelerated as
provided in Article 6 hereof for the purposes of this Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (y) in
the event of any declaration of acceleration of such obligations as
provided in Article 6 hereof, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Guarantors for the
purpose of this Subsidiary Guarantee. The Guarantors shall have the right
to seek contribution from any non-paying Guarantor so long as the exercise
of such right does not impair the rights of the Holders under the
Guarantee.
Section 10.02 LIMITATION ON GUARANTOR LIABILITY.
Each Guarantor, and by its acceptance of Senior Notes, each
Holder, hereby confirms that it is the intention of all such parties that
the Subsidiary Guarantee of such Guarantor not constitute a fraudulent
transfer or conveyance for purposes of Bankruptcy Law, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any
similar federal or state law to the extent applicable to any Subsidiary
Guarantee. To effectuate the foregoing intention, the Trustee, the Holders
and the Guarantors hereby irrevocably agree that the obligations of such
Guarantor will, after giving effect to such maximum amount and all other
contingent and fixed liabilities of such Guarantor that are relevant under
such laws, and after giving effect to any collections from, rights to
receive contribution from or payments made by or on behalf of any other
Guarantor in respect of the obligations of such other Guarantor under this
Article 10, result in the obligations of such Guarantor under its
Subsidiary Guarantee not constituting a fraudulent transfer or conveyance.
Section 10.03. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section 10.01,
each Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form included in Exhibit E shall be endorsed by an
officer of such Guarantor on each Senior Note authenticated and delivered
by the Trustee and that this Indenture shall be executed on behalf of such
Guarantor by its President or one of its Vice Presidents and attested to by
an Officer.
Each Guarantor hereby agrees that its Subsidiary Guarantee set
forth in Section 10.01 shall remain in full force and effect
notwithstanding any failure to endorse on each Senior Note a notation of
such Subsidiary Guarantee.
If an officer or Officer whose signature is on this Indenture or
on the Subsidiary Guarantee no longer holds that office at the time the
Trustee authenticates the Senior Note on which a Subsidiary Guarantee is
endorsed, the Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Senior Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Subsidiary Guarantee set forth in this Indenture on behalf of the
Guarantors.
In the event that the Company creates or acquires any new
Subsidiaries subsequent to the date of this Indenture, if required by
Section 4.17 hereof, the Company shall cause such Subsidiaries to execute
supplemental indentures to this Indenture and Subsidiary Guarantees in
accordance with Section 4.17 hereof and this Article 10, to the extent
applicable.
Section 10.04. GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
No Guarantor may consolidate with or merge with or into (whether
or not such Guarantor is the surviving Person) another corporation, Person
or entity whether or not affiliated with such Guarantor unless:
(a) subject to Section 10.05 hereof, the Person formed by or
surviving any such consolidation or merger (if other than a Guarantor
or the Company) unconditionally assumes all the obligations of such
Guarantor, pursuant to a supplemental indenture in form and substance
reasonably satisfactory to the Trustee, under the Senior Notes, the
Indenture and the Subsidiary Guarantee on the terms set forth herein
or therein; and
(b) immediately after giving effect to such transaction, no
Default or Event of Default exists.
In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory in form
to the Trustee, of the Subsidiary Guarantee endorsed upon the Notes and the
due and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Guarantor, such successor corporation
shall succeed to and be substituted for the Guarantor with the same effect
as if it had been named herein as a Guarantor. Such successor corporation
thereupon may cause to be signed any or all of the Subsidiary Guarantees to
be endorsed upon all of the Notes issuable hereunder which theretofore
shall not have been signed by the Company and delivered to the Trustee. All
the Subsidiary Guarantees so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Subsidiary Guarantees
theretofore and thereafter issued in accordance with the terms of this
Indenture as though all of such Subsidiary Guarantees had been issued at
the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and
notwithstanding clauses (a) and (b) above, nothing contained in this
Indenture or in any of the Senior Notes shall prevent any consolidation or
merger of a Guarantor with or into the Company or another Guarantor, or
shall prevent any sale or conveyance of the property of a Guarantor as an
entirety or substantially as an entirety to the Company or another
Guarantor.
Section 10.05. RELEASES FOLLOWING SALE OF ASSETS.
In the event of a sale or other disposition of all of the assets
of any Guarantor, by way of merger, consolidation or otherwise, or a sale
or other disposition of all to the capital stock of any Guarantor, then
such Guarantor (in the event of a sale or other disposition, by way of
merger, consolidation or otherwise, of all of the capital stock of such
Guarantor) or the corporation acquiring the property (in the event of a
sale or other disposition of all or substantially all of the assets of such
Guarantor) will be released and relieved of any obligations under its
Subsidiary Guarantee; provided that the Net Proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of
this Indenture, including without limitation Section 4.10 hereof. Upon
delivery by the Company to the Trustee of an Officers' Certificate and an
Opinion of Counsel to the effect that such sale or other disposition was
made by the Company in accordance with the provisions of this Indenture,
including without limitation Section 4.10 hereof, the Trustee shall execute
any documents reasonably required in order to evidence the release of any
Guarantor from its obligations under its Subsidiary Guarantee.
Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal
of and interest on the Senior Notes and for the other obligations of any
Guarantor under this Indenture as provided in this Article 10.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA ss.318(c), the imposed duties shall control.
SECTION 11.02. NOTICES.
Any notice or communication by the Company or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by
first class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery, to the
others' address:
If to the Company:
Xxxxxxx Sports Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxx Xxxxxxxxxx, Chief Financial Officer
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx Xxxxx
If to the Trustee:
Marine Midland Bank
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Department
The Company, any Guarantor or the Trustee, by notice to the
others may designate additional or different addresses for subsequent
notices or communications.
All notices and communications (other than those sent to Holders)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if telecopied; and
the next Business Day after timely delivery to the courier, if sent by
overnight air courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown
on the register kept by the Registrar. Any notice or communication shall
also be so mailed to any Person described in TIA ss. 313(c), to the extent
required by the TIA. Failure to mail a notice or communication to a Holder
or any defect in it shall not affect its sufficiency with respect to other
Holders.
If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the
addressee receives it.
If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.
SECTION 11.03. COMMUNICATION BY HOLDERS OF SENIOR NOTES WITH OTHER
HOLDERS OF SENIOR NOTES.
Holders may communicate pursuant to TIA ss. 312(b) witH other
Holders with respect to their rights under this Indenture or the Senior
Notes. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA ss. 312(c).
SECTION 11.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the
Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set
forth in Section 11.05 hereof) stating that, in the opinion of the
signers, all conditions precedent and covenants, if any, provided for
in this Indenture relating to the proposed action have been
satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set
forth in Section 11.05 hereof) stating that, in the opinion of such
counsel, all such conditions precedent and covenants have been
satisfied.
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 a
certificate provided pursuant to TIA ss. 314(a)(4)) shall comply with the
provisions of TIA ss. 314(e) and shall include:
(a) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been satisfied; and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been satisfied.
SECTION 11.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules
and set reasonable requirements for its functions.
SECTION 11.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES
AND STOCKHOLDERS.
No past, present or future director, officer, employee,
incorporator or stockholder of the Company or any Guarantor, as such, shall
have any liability for any obligations of the Company or the Guarantors
under the Senior Notes, the Subsidiary Guarantees or this Indenture or for
any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Senior Note waives and releases
all such liability. The waiver and release are part of the consideration
for issuance of the Senior Notes.
SECTION 11.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE, THE SENIOR NOTES AND THE SUBSIDIARY
GUARANTEES BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS
OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 11.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of the Company or its Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
SECTION 11.10. SUCCESSORS.
All agreements of the Company in this Indenture and the Senior
Notes shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 11.11. SEVERABILITY.
In case any provision in this Indenture or in the Senior Notes
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 11.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the
same agreement.
SECTION 11.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings of the
Articles and Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part of this Indenture and
shall in no way modify or restrict any of the terms or provisions hereof.
SECTION 11.14. "TRUSTEE" TO INCLUDE PAYING AGENT.
In case at any time any Paying Agent other than the Trustee shall
have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article 10, shall in such case (unless the
context shall otherwise require) be construed as extending to and including
such Paying Agent within its meaning as fully and for all intents and
purposes as if such Paying Agent were named in this Article 10, in place of
the Trustee.
[Signatures on following page]
SIGNATURES
Dated as of June 19, 1997
XXXXXXX SPORTS INC.
By: ________________________________
Name:
Title:
XXXXXXX GUARANTORS:
XXXXXXX, INC.
ALL AMERICAN SPORTS CORPORATION
EQUILINK LICENSING CORP.
PROACQ CORPORATION
RHC LICENSING CORP.
RIDMARK CORPORATION
CHEER ACQUISITION CORP.
By: _____________________________
Name:
Title:
VARSITY GUARANTORS:
VARSITY SPIRIT CORPORATION
VARSITY SPIRIT FASHIONS & SUPPLIES, INC.
VARSITY USA, INC.
VARSITY/INTROPA TOURS, INC.
INTERNATIONAL LOGOS, INC.
By: ________________________________
Name:
Title:
MARINE MIDLAND BANK
By:_____________________________________
Name:
Title:
EXHIBIT A
(Face of Senior Note)
CUSIP/CINS ____________
10 1/2% Senior Notes due 2007
No. ___ $__________
XXXXXXX SPORTS INC., a Delaware corporation
promises to pay to _________________________________________________
or registered assigns,
the principal sum of ________________________________________________
Dollars on July 15, 2007.
Interest Payment Dates: January 15, and July 15
Record Dates: January 1, and July 1 (whether or not a Business Day)
Reference is hereby made to the further provisions of this Senior Note
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Dated: _______________
XXXXXXX SPORTS INC.
By:____________________
Name:
Title:
(SEAL)
This is one of the [Global]
Senior Notes referred to in the
within-mentioned Indenture:
MARINE MIDLAND BANK,
as Trustee
By:______________________________
Authorized Signatory
(Back of Senior Note)
10 1/2% Senior Notes due 2007
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO
ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY
MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.07
OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE COMPANY.
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO
ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY
MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06
OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS
GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE COMPANY.
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Xxxxxxx Sports Inc., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Senior
Note at 10 1/2% per annum from June 19, 1997 until maturity and shall pay
the Liquidated Damages payable pursuant to Section 5 of the Registration
Rights Agreement referred to below. The Company will pay interest and
Liquidated Damages, if any, semi-annually in arrears on January 15 and
July 15 of each year, or if any such day is not a Business Day, on the next
succeeding Business Day (each an "Interest Payment Date"). Interest on the
Senior Notes will accrue from the most recent date to which interest has
been paid or, if no interest has been paid, from the date of issuance;
provided that if there is no existing Default in the payment of interest,
and if this Senior Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest
shall accrue from such next succeeding Interest Payment Date; provided,
further, that the first Interest Payment Date shall be January 15, 1998.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if
any, from time to time on demand at a rate that is 1% per annum in excess
of the rate then in effect; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Liquidated Damages (without regard to any
applicable grace periods) from time to time on demand at the same rate to
the extent lawful. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the Senior
Notes (except defaulted interest) and Liquidated Damages, if any, to the
Persons who are registered Holders of Senior Notes at the close of business
on the January 1 or July 1 next preceding the Interest Payment Date, even
if such Senior Notes are canceled after such record date and on or before
such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Senior Notes will be
payable as to principal, premium and Liquidated Damages, if any, and
interest at the office or agency of the Company maintained for such purpose
within or without the City and State of New York, or, at the option of the
Company, payment of interest and Liquidated Damages may be made by check
mailed to the Holders at their addresses set forth in the register of
Holders, and provided that payment by wire transfer of immediately
available/next day funds will be required with respect to principal of and
interest, premium and Liquidated Damages on, all Global Notes and all other
Senior Notes the Holders of which shall have provided wire transfer
instructions to the Company or the Paying Agent. Such payment shall be in
such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, Marine Midland Bank, the
Trustee under the Indenture, will act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any
Holder. The Company or any of its Subsidiaries may act in any such
capacity.
4. INDENTURE. The Company issued the Senior Notes under an Indenture
dated as of June 19, 1997 ("Indenture") between the Company, the Guarantors
and the Trustee. The terms of the Senior Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code xx.xx. 77aaa-77bbbb). The
Senior Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any
provision of this Senior Note conflicts with the express provisions of the
Indenture, the provisions of the indenture shall govern and be controlling.
The Senior Notes are obligations of the Company limited to $140 million in
aggregate principal amount, and will mature on July 15, 2007.
5. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 5, the
Senior Notes shall not be redeemable at the Company's option prior to July
15, 2002. Thereafter, the Senior Notes shall be subject to redemption at
any time at the option of the Company, in whole or in part, upon not less
than 30 nor more than 60 days' notice, at the redemption prices (expressed
as percentages of principal amount) set forth below plus accrued and unpaid
interest and Liquidated Damages thereon to the applicable redemption date,
if redeemed during the twelve-month period beginning on July 15 of the
years indicated below:
Year Percentage
2002......................................... 105.25%
2003......................................... 103.50%
2004......................................... 101.75%
2005 and thereafter ......................... 100.00%
(b) Notwithstanding the provisions of clause (a) of this Section
5, at any time on or before July 15, 2000, the Company may (but shall not
have the obligation to) redeem, on one or more occasions, up to 35% of the
aggregate principal amount of the Senior Notes at a redemption price equal
to 110 1/2% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the redemption date,
with the net cash proceeds of one or more Equity Offerings; provided that
at least $75.0 million aggregate principal amount of Senior Notes remain
outstanding immediately after the occurrence of such redemption; and
provided further, that such redemption shall occur within 45 days of the
date of the closing of such Equity Offering.
6. MANDATORY REDEMPTION.
Except as set forth in paragraph 7 below, the Company shall not be
required to make mandatory redemption payments with respect to the Senior
Notes.
7. REPURCHASE AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company shall be required to
make an offer (a "Change of Control Offer") to repurchase all or any part
(equal to $1,000 or an integral multiple thereof) of each Holder's Senior
Notes at a purchase price equal to 101% of the aggregate principal amount
thereof plus accrued and unpaid interest and Liquidated Damages, if any, to
the date of purchase the "Change of Control Payment"). Within 30 days
following any Change of Control, the Company shall mail a notice to each
Holder setting forth the procedures governing the Change of Control Offer
as required by the Indenture.
(b) If the Company or a Subsidiary consummates any Asset Sales, within
five days of each date on which the aggregate amount of Excess Proceeds
exceeds $5 million, the Company shall commence an offer to all Holders of
Senior Notes (as "Asset Sale Offer") pursuant to Section 3.09 of the
Indenture to purchase the maximum principal amount of Senior Notes
(including any Additional Senior Notes) that may be purchased out of the
Excess Proceeds at an offer price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest, if any, to the
date of purchase in accordance with the procedures set forth in the
Indenture. To the extent that the aggregate amount of Senior Notes
(including any Additional Senior Notes) tendered pursuant to an Asset Sale
Offer is less than the Excess Proceeds, the Company (or such Subsidiary)
may use such any remaining Excess Proceeds for general corporate purposes.
If the aggregate principal amount of Senior Notes (including any Additional
Senior Notes) surrendered by Holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Senior Notes (including any
Additional Senior Notes) to be purchased on a pro rata basis. Holders of
Senior Notes and Additioinal Senior Notes that are the subject of an offer
to purchase will receive an Asset Sale Offer from the Company prior to any
related purchase date and may elect to have such Senior Notes and
Additional Senior Notes purchased by completing the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Senior Notes.
8. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Senior Notes are to be redeemed at its registered address. Senior
Notes in denominations larger than $1,000 may be redeemed in part but only
in whole multiples of $1,000, unless all of the Senior Notes held by a
Holder are to be redeemed. On and after the redemption date, interest
ceases to accrue on Senior Notes or portions thereof called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Senior Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Senior Notes may be registered and
Senior Notes may be exchanged as provided in the Indenture. The Registrar
and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require
a Holder to pay any taxes and fees required by law or permitted by the
Indenture. The Company need not exchange or register the transfer of any
Senior Note or portion of a Senior Note selected for redemption, except for
the unredeemed portion of any Senior Note being redeemed in part. Also, the
Company need not exchange or register the transfer of any Senior Notes for
a period of 15 days before a selection of Senior Notes to be redeemed or
during the period between a record date and the corresponding Interest
Payment Date.
10. PERSONS DEEMED OWNERS. The registered Holder of a Senior Note may
be treated as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Indenture or the Senior Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the
then outstanding Senior Notes and Additional Senior Notes, if any, voting
as a single class (including consents obtained in connection with a tender
offer or exchange offer for the Senior Notes), and any existing default or
compliance with any provision of the Indenture, the Subsidiary Guarantees
or the Senior Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Senior Notes and
Additional Senior Notes, if any, voting as a single class (including
consents obtained in connection with a tender offer or exchange offer for
the Senior Notes). Without the consent of any Holder of a Senior Note, the
Indenture or the Senior Notes may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Senior
Notes in addition to or in place of certificated Senior Notes, to provide
for the assumption of the Company's or Guarantor's obligations to Holders
of the Senior Notes in case of a merger or consolidation pursuant to
Article 5 of the Indenture, to provide for the Issuance of Additional
Senior Notes, in accordance with the limitations set forth in the
Indenture, to make any change that would provide any additional rights or
benefits to the Holders of the Senior Notes or that does not adversely
affect the legal rights under the Indenture of any such Holder, to comply
with the requirements of the Commission in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act or to allow
any Guarantor to execute a supplemental indenture and/or a Subsidiary
Guarantee with respect to the Senior Notes.
12. DEFAULTS AND REMEDIES. Events of Default include: (i) default for
30 days in the payment when due of interest on, or Liquidated Damages with
respect to, the Senior Notes; (ii) default in payment when due of the
principal of or premium, if any, on the Senior Notes; (iii) failure by the
Company to comply with the provisions described under the captions 4.07,
4.09, 4.10 or 4.15; (iv) failure by the Company for 60 days after notice
from the Trustee or the Holders of at least 25% of the Senior Notes
(including Additional Senior Notes, if any) voting as a single class, then
outstanding to comply with any of its other agreements in the Indenture or
the Senior Notes; (v) default under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by the
Company or any of its Restricted Subsidiaries) whether such Indebtedness or
guarantee now exists, or is created after the date of the Indenture, which
default (a) is caused by a failure to pay principal of or premium, if any,
or interest on such Indebtedness prior to the expiration of the grace
period provided in such Indebtedness on the date of such default (a
"Payment Default") or (b) results in the acceleration of such Indebtedness
prior to its express maturity and, in each case, the principal amount of
any such Indebtedness, together with the principal amount of any other such
Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates $5.0 million or more; (vi)
failure by the Company or any of its Restricted Subsidiaries to pay final
judgments aggregating in excess of $5.0 million, which judgments are not
paid, discharged or stayed for a period of 60 days; (vii) except as
permitted by the Indenture, any Subsidiary Guarantee shall be held in any
judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or any Guarantor, or any Person
acting on behalf of any Guarantor, shall deny or disaffirm its obligations
under its Subsidiary Guarantee; and (viii) certain events of bankruptcy or
insolvency with respect to the Company or any of its Significant Restricted
Subsidiaries.
13. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder, of the Company or any of the Guarantors, as
such, shall not have any liability for any obligations of the Company or
such Guarantors under the Senior Notes, the Subsidiary Guarantee or the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder by accepting a Senior Note
waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of the Senior Notes.
15. AUTHENTICATION. This Senior Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.
16. ABBREVIATIONS. Customary abbreviations may be used in the name of
a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(= Uniform Gifts to Minors Act).
17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE Notes. In addition to the rights provided to Holders
of Senior Notes under the Indenture, Holders of Restricted Global Notes and
Restricted Definitive Notes shall have all the rights set forth in the
Registration Rights Agreement dated as of June 19, 1997, between the
Company and the parties named on the signature pages thereof or, in the
case of Additional Senior Notes, Holders of Restricted Global Notes and
Restricted Definitive Notes shall have all the rights set forth in one or
more registration rights agreements between the Company and the other
parties named on the signature pages thereto, relating to rights given by
the Company to the purchasers of any Additional Senior Notes (collectively,
the "Registration Rights Agreement").
18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Senior Notes and the Trustee may
use CUSIP numbers in notices of redemption as a convenience to Holders. No
representation is made as to the accuracy of such numbers either as printed
on the Senior 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 a copy of the Indenture and/or the Registration Rights
Agreement. Requests may be made to:
Xxxxxxx Sports Inc.
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Secretary
ASSIGNMENT FORM
To assign this Senior Note, fill in the form below: (I) or (we)
assign and transfer this Senior Note to
____________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________________________________________________
to transfer this Senior Note on the books of the Company. The agent may
substitute another to act for him.
____________________________________________________________________________
Date: ______________________________________________________________________
Your Signature:_______________________________
(Sign exactly as your name appears on the face of this Senior Note)
Signature Guarantee:* ________________________________________________
* Participant is a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Note purchased by the
Company pursuant to Section 4.10 or 4.15 of the Indenture, check the
appropriate box below:
( ) Section 4.10 ( ) Section 4.15
If you want to elect to have only part of the Senior Note
purchased by the Company pursuant to Section 4.10 or Section 4.15 of the
Indenture, state the amount you elect to have purchased: $___________
Date: ___________________ Your Signature:______________________
(Sign exactly as your name
appears on the Senior Note)
Tax Identification No.:______________
Signature Guarantee:* ________________________________________________
* Participant is a recognized Signature Guarantee Medallion Program (or
other signature guarantor acceptable to the Trustee).
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a
part of another Global Note or Definitive Note for an interest in this
Global Note, have been made:
Signature of
Amount of Principal Amount of authorized officer
decrease in Amount of increase in this Global Note of Trustee or
Principal Amount of Principal Amount of following such decrease Senior Note
Date of Exchange this Global Note this Global Note (or increase) Custodian
---------------- --------------------- ---------------------- ------------------------ ------------------
EXHIHBIT B
FORM OF CERTIFICATE OF TRANSFER
Xxxxxxx Sports Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Marine Midland Bank
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: _____________
Re: 10 1/2% Senior Notes due 2007
Reference is hereby made to the Indenture, dated as of June 19,
1997 (the "Indenture"), between Xxxxxxx Sports Inc., as issuer (the
"Company"), the parties listed in Schedule I thereto, as Guarantors and
Marine Midland Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
______________, (the "Transferor") owns and proposes to transfer
the Senior Note[s] or interest in such Senior Note[s] specified in Annex A
hereto, in the principal amount of $___________ in such Senior Note[s] or
interests (the "Transfer"), to __________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the
Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. |_| Check if Transferee will take delivery of a beneficial interest in
the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A
under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
beneficial interest or Definitive Note is being transferred to a Person
that the Transferor reasonably believed and believes is purchasing the
beneficial interest or Definitive Note for its own account, or for one or
more accounts with respect to which such Person exercises sole investment
discretion, and such Person and each such account is a "qualified
institutional buyer" within the meaning of Rule 144A in a transaction
meeting the requirements of Rule 144A and such Transfer is in compliance
with any applicable blue sky securities laws of any state of the United
States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive
Note will be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the 144A Global Note and/or the
Definitive Note and in the Indenture and the Securities Act.
2. |_| Check if Transferee will take delivery of a beneficial interest in
the Regulation S Global Note or a Definitive Note pursuant to Regulation S.
The Transfer is being effected pursuant to and in accordance with Rule 903
or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a
person in the United States and (x) at the time the buy order was
originated, the Transferee was outside the United States or such Transferor
and any Person acting on its behalf reasonably believed and believes that
the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore
securities market and neither such Transferor nor any Person acting on its
behalf knows that the transaction was prearranged with a buyer in the
United States, (ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, (iii) the transaction is not part of
a plan or scheme to evade the registration requirements of the Securities
Act and (iv) if the proposed transfer is being made prior to the expiration
of the Restricted Period, the transfer is not being made to a U.S. Person
or for the account or benefit of a U.S. Person (other than an Initial
Purchaser). Upon consummation of the proposed transfer in accordance with
the terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on Transfer enumerated
in the Private Placement Legend printed on the Regulation S Global Note
and/or the Definitive Note and in the Indenture and the Securities Act.
3. |_| Check and complete if Transferee will take delivery of a beneficial
interest in the IAI Global Note or a Definitive Note pursuant to any
provision of the Securities Act other than Rule 144A or Regulation S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act and any applicable blue sky securities laws of any state of
the United States, and accordingly the Transferor hereby further certifies
that (check one):
(a) |_| such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) |_| such Transfer is being effected to the Company or a subsidiary
thereof;
or
(c) |_| such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) |_| such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the
Transferor hereby further certifies that the Transfer complies with the
transfer restrictions applicable to beneficial interests in a Restricted
Global Note or Restricted Definitive Notes and the requirements of the
exemption claimed, which certification is supported by (1) a certificate
executed by the Transferee in the form of Exhibit D to the Indenture and
(2) [if such Transfer is in respect of a principal amount of Senior Notes
at the time of transfer of less than $250,000,] an Opinion of Counsel
provided by the Transferor or the Transferee (a copy of which the
Transferor has attached to this certification), to the effect that such
Transfer is in compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed
on the IAI Global Note and/or the Definitive Notes and in the Indenture and
the Securities Act.
4. |_| Check if Transferee will take delivery of a beneficial interest in
an Unrestricted Global Note or of an Unrestricted Definitive Note.
(a) |_| Check if Transfer is pursuant to Rule 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained
in the Indenture and any applicable blue sky securities laws of any state
of the United States and (ii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the
transferred beneficial interest or Definitive Note will no longer be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Notes, on Restricted Definitive
Notes and in the Indenture.
(b) |_| Check if Transfer is Pursuant to Regulation S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904
under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of
any state of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will no
longer be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes, on Restricted
Definitive Notes and in the Indenture.
(c) |_| Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule
144, Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of
any State of the United States and (ii) the restrictions on transfer
contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will not
be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Notes or Restricted
Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
______________________________
[Insert Name of Transferor]
By:___________________________
Name:
Title:
Dated: _________________, _______
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) |_| a beneficial interest in the:
(i) |_| 144A Global Note (CUSIP ), or
(ii) |_| Regulation S Global Note (CUSIP ), or
(iii) |_| IAI Global Note (CUSIP ); or
(b) |_| a Restricted Definitive Note.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) |_| a beneficial interest in the:
(i) |_| 144A Global Note (CUSIP ), or
(ii) |_| Regulation S Global Note (CUSIP ), or
(iii) |_| IAI Global Note (CUSIP ); or
(iv) |_| Unrestricted Global Note (CUSIP ); or
(b) |_| a Restricted Definitive Note; or
(c) |_| an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Xxxxxxx Sports Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: _____________
Marine Midland Bank
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: _____________
Re: 10 1/2% Senior Notes due 2007
(CUSIP )
Reference is hereby made to the Indenture, dated as of June 19,
1997 (the "Indenture"), among Xxxxxxx Sports Inc., as issuer (the
"Company"), the parties listed in Schedule I thereto, as Guarantors, and
Marine Midland Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
_________________, (the "Owner") owns and proposes to exchange
the Senior Note[s] or interest in such Senior Note[s] specified herein, in
the principal amount of $____________ in such Senior Note[s] or interests
(the "Exchange"). In connection with the Exchange, the Owner hereby
certifies that:
1. Exchange of Restricted Definitive Notes or Beneficial
Interests in a Restricted Global Note for Unrestricted Definitive Notes or
Beneficial Interests in an Unrestricted Global Note
(a) |_| Check if Exchange is from beneficial interest in a
Restricted Global Note to beneficial interest in an Unrestricted Global
Note. In connection with the Exchange of the Owner's beneficial interest in
a Restricted Global Note for a beneficial interest in an Unrestricted
Global Note in an equal principal amount, the Owner hereby certifies (i)
the beneficial interest is being acquired for the Owner's own account
without transfer, (ii) such Exchange has been effected in compliance with
the transfer restrictions applicable to the Global Notes and pursuant to
and in accordance with the United States Securities Act of 1933, as amended
(the "Securities Act"), (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial
interest in an Unrestricted Global Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United
States.
(b) |_| Check if Exchange is from beneficial interest in a
Restricted Global Note to Unrestricted Definitive Note. In connection with
the Exchange of the Owner's beneficial interest in a Restricted Global Note
for an Unrestricted Definitive Note, the Owner hereby certifies (i) the
Definitive Note is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Notes and
pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Definitive Note is being acquired in compliance
with any applicable blue sky securities laws of any state of the United
States.
(c) |_| Check if Exchange is from Restricted Definitive Note to
beneficial interest in an Unrestricted Global Note. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest
in an Unrestricted Global Note, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Indenture and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
(d) |_| Check if Exchange is from Restricted Definitive Note to
Unrestricted Definitive Note. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner
hereby certifies (i) the Unrestricted Definitive Note is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been
effected in compliance with the transfer restrictions applicable to
Restricted Definitive Notes and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Unrestricted
Definitive Note is being acquired in compliance with any applicable blue
sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Notes or Beneficial Interests in
Restricted Global Notes for Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes
(a) |_| Check if Exchange is from beneficial interest in a
Restricted Global Note to Restricted Definitive Note. In connection with
the Exchange of the Owner's beneficial interest in a Restricted Global Note
for a Restricted Definitive Note with an equal principal amount, the Owner
hereby certifies that the Restricted Definitive Note is being acquired for
the Owner's own account without transfer. Upon consummation of the proposed
Exchange in accordance with the terms of the Indenture, the Restricted
Definitive Note issued will continue to be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the
Restricted Definitive Note and in the Indenture and the Securities Act.
(b) |_| Check if Exchange is from Restricted Definitive Note to
beneficial interest in a Restricted Global Note. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial
interest in the [CHECK ONE] |_| 144A Global Note, |_| Regulation S Global
Note, |_| IAI Global Note with an equal principal amount, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own
account without transfer and (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Restricted
Global Notes and pursuant to and in accordance with the Securities Act, and
in compliance with any applicable blue sky securities laws of any state of
the United States. Upon consummation of the proposed Exchange in accordance
with the terms of the Indenture, the beneficial interest issued will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the relevant Restricted Global Note and in the Indenture
and the Securities Act.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
_______________________________
[Insert Name of Owner]
By:_____________________________
Name:
Title:
Dated: _________________, ______
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Xxxxxxx Sports Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: ____________
Marine Midland Bank
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: ____________
Re: 10 1/2% Senior Notes due 2007
Reference is hereby made to the Indenture, dated as of June 19,
1997 (the "Indenture"), between Xxxxxxx Sports Inc., as issuer (the
"Company"), the parties listed in Schedule I thereto, as Guarantors and
Marine Midland Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
In connection with our proposed purchase of $____________
aggregate principal amount of:
(a) |_| a beneficial interest in a Global Note, or
(b) |_| a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Senior Notes
or any interest therein is subject to certain restrictions and conditions
set forth in the Indenture and the undersigned agrees to be bound by, and
not to resell, pledge or otherwise transfer the Senior Notes or any
interest therein except in compliance with, such restrictions and
conditions and the United States Securities Act of 1933, as amended (the
"Securities Act").
2. We understand that the offer and sale of the Senior Notes have
not been registered under the Securities Act, and that the Senior Notes and
any interest therein may not be offered or sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, that if we should
sell the Senior Notes or any interest therein, we will do so only (A) to
the Company or any subsidiary thereof, (B) in accordance with Rule 144A
under the Securities Act to a "qualified institutional buyer" (as defined
therein), (C) to an institutional "accredited investor" (as defined below)
that is purchasing at least $250,000 principal amount of Senior Notes and
that, prior to such transfer, furnishes (or has furnished on its behalf by
a U.S. broker-dealer) to you and to the Company a signed letter
substantially in the form of this letter and an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such transfer is in
compliance with the Securities Act, (D) outside the United States in
accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144 under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any person purchasing the Definitive
Note or beneficial interest in a Global Note from us in a transaction
meeting the requirements of clauses (A) through (E) of this paragraph a
notice advising such purchaser that resales thereof are restricted as
stated herein.
3. We understand that, on any proposed resale of the Senior Notes
or beneficial interest therein, we will be required to furnish to you and
the Company such certifications, legal opinions and other information as
you and the Company may reasonably require to confirm that the proposed
sale complies with the foregoing restrictions. We further understand that
the Senior Notes purchased by us will bear a legend to the foregoing
effect. We further understand that any subsequent transfer by us of the
Senior Notes or beneficial interest therein acquired by us must be effected
through one of the Placement Agents.
4. We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act)
and have such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of our investment in the
Senior Notes, and we and any accounts for which we are acting are each able
to bear the economic risk of our or its investment.
5. We are acquiring the Senior Notes or beneficial interest
therein purchased by us for our own account or for one or more accounts
(each of which is an institutional "accredited investor") as to each of
which we exercise sole investment discretion, and are so acquiring or
purchasing at least $250,000 principal amount of Senior Notes.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official
inquiry with respect to the matters covered hereby.
______________________________________
[Insert Name of Accredited Investor]
By: _________________________________
Name:
Title:
Dated: _________________, ______
EXHIBIT E
FORM OF NOTATION OF SECURITY
RELATING TO SUBSIDIARY GUARANTEE
For value received, each Guarantor (which term includes any
successor Person under the Indenture) has, jointly and severally,
unconditionally guaranteed, to the extent set forth in the Indenture and
subject to the provisions in the Indenture dated as of June 19, 1997 (the
"Indenture") among Xxxxxxx Sports Inc., the Guarantors listed on Schedule I
thereto and Marine Midland Bank, as trustee (the "Trustee"), (a) the due
and punctual payment of the principal of, premium, if any, and interest on
the Senior Notes (as defined in the Indenture), whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of
interest on overdue principal and premium, and, to the extent permitted by
law, interest, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee all in accordance
with the terms of the Indenture and (b) in case of any extension of time of
payment or renewal of any Senior Notes or any of such other obligations,
that the same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. The obligations of the Guarantors
to the Holders of Senior Notes and to the Trustee pursuant to the
Subsidiary Guarantee and the Indenture are expressly set forth in Article
10 of the Indenture and reference is hereby made to the Indenture for the
precise terms of the Subsidiary Guarantee. Each Holder of a Senior Note, by
accepting the same, (a) agrees to and shall be bound by such provisions,
(b) authorizes and directs the Trustee, on behalf of such Holder, to take
such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided, however, that
the Indebtedness evidenced by this Subsidiary Guarantee shall cease to be
so subordinated and subject in right of payment upon any defeasance of this
Senior Note in accordance with the provisions of the Indenture.
XXXXXXX GUARANTORS:
XXXXXXX, INC.
ALL AMERICAN SPORTS CORPORATION
EQUILINK LICENSING CORP.
PROACQ CORPORATION
RHC LICENSING CORP.
RIDMARK CORPORATION
CHEER ACQUISITION CORP.
By: ________________________________
Name:
Title:
VARSITY GUARANTORS:
VARSITY SPIRIT CORPORATION
VARSITY SPIRIT FASHIONS & SUPPLIES, INC.
VARSITY USA, INC.
VARSITY/INTROPA TOURS, INC.
INTERNATIONAL LOGOS, INC.
By: ________________________________
Name:
Title:
EXHIBIT F
FORM OF SUPPLEMENTAL INDENTURE TO BE DELIVERED BY GUARANTEEING SUBSIDIARY
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as
of ________________, among __________________ (the "Guaranteeing
Subsidiary"), a subsidiary of Xxxxxxx Sports Inc. (or its permitted
successor), a Delaware corporation (the "Company"), the Company, the other
parties listed on Schedule I hereto as Guarantors and Marine Midland Bank,
as trustee under the indenture referred to below (the "Trustee").
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an indenture (the "Indenture"), dated as of June 19, 1997 providing
for the issuance of an aggregate principal amount of up to $140,000,000 of
10 1/2% Senior Notes due 2007 (the "Senior Notes");
WHEREAS, the Indenture provides that under certain circumstances
the Guaranteeing Subsidiary shall execute and deliver to the Trustee a
supplemental indenture pursuant to which the Guaranteeing Subsidiary shall
unconditionally guarantee all of the Company's Obligations under the Senior
Notes and the Indenture on the terms and conditions set forth herein (the
"Subsidiary Guarantee"); and
WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee
is authorized to execute and deliver this Supplemental Indenture.
NOW THEREFORE, in consideration of the foregoing and for other
good and valuable consideration, the receipt of which is hereby
acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant
and agree for the equal and ratable benefit of the Holders of the Senior
Notes as follows:
1. CAPITALIZED TERMS. Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
2. AGREEMENT TO GUARANTEE. The Guaranteeing Subsidiary hereby agrees
as follows:
(a) Along with all Guarantors named in the Indenture, to jointly
and severally Guarantee to each Holder of a Senior Note
authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, irrespective of the
validity and enforceability of the Indenture, the Senior
Notes or the obligations of the Company hereunder or
thereunder, that:
(i) the principal of and interest on the Senior Notes will
be promptly paid in full when due, whether at maturity, by
acceleration, redemption or otherwise, and interest on the
overdue principal of and interest on the Senior Notes, if
any, if lawful, and all other obligations of the Company to
the Holders or the Trustee hereunder or thereunder will be
promptly paid in full or performed, all in accordance with
the terms hereof and thereof; and
(ii) in case of any extension of time of payment or renewal
of any Senior Notes or any of such other obligations, that
same will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal,
whether at stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay
the same immediately.
(b) The obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability
of the Senior Notes or the Indenture, the absence of any
action to enforce the same, any waiver or consent by any
Holder of the Senior Notes with respect to any provisions
hereof or thereof, the recovery of any judgment against the
Company, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor.
(c) The following is hereby waived:diligence presentment, demand
of payment, filing of claims with a court in the event of
insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest,
notice and all demands whatsoever.
(d) This Subsidiary Guarantee shall not be discharged except
by complete performance of the obligations contained in the
Senior Notes and the Indenture.
(e) If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Guarantors, or any
Custodian, Trustee, liquidator or other similar official
acting in relation to either the Company or the Guarantors,
any amount paid by either to the Trustee or such Holder,
this Subsidiary Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect.
(f) The Guaranteeing Subsidiary shall not be entitled to any
right of subrogation in relation to the Holders in respect
of any obligations guaranteed hereby until payment in full
of all obligations guaranteed hereby.
(g) As between the Guarantors, on the one hand, and the Holders
and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided
in Article 6 of the Indenture for the purposes of this
Subsidiary Guarantee, notwithstanding any stay, injunction
or other prohibition preventing such acceleration in respect
of the obligations guaranteed hereby, and (y) in the event
of any declaration of acceleration of such obligations as
provided in Article 6 of the Indenture, such obligations
(whether or not due and payable) shall forthwith become due
and payable by the Guarantors for the purpose of this
Subsidiary Guarantee.
(h) The Guarantors shall have the right to seek contribution
from any non-paying Guarantor so long as the exercise of
such right does not impair the rights of the Holders under
the Guarantee.
(i) Pursuant to Section 10.02 of the Indenture, after giving
effect to any maximum amount and any other contingent and
fixed liabilities that are relevant under any applicable
Bankruptcy or fraudulent conveyance laws, and after giving
effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any
other Guarantor in respect of the obligations of such other
Guarantor under Article 10 of the Indenture shall result in
the obligations of such Guarantor under its Subsidiary
Guarantee not constituting a fraudulent transfer or
conveyance.
3. EXECUTION AND DELIVERY. Each Guaranteeing Subsidiary agrees that the
Subsidiary Guarantees shall remain in full force and effect notwithstanding
any failure to endorse on each Senior Note a notation of such Subsidiary
Guarantee.
4. GUARANTEEING SUBSIDIARY MAY CONSOLIDATE, ETC. ON CERTAIN TERMS.
(a) The Guaranteeing Subsidiary may not consolidate with or merge
with or into (whether or not such Guarantor is the surviving
Person) another corporation, Person or entity whether or not
affiliated with such Guarantor unless:
(i) subject to Section 10.05 of the Indenture, the Person formed
by or surviving any such consolidation or merger (if other
than a Guarantor or the Company) unconditionally assumes all
the obligations of such Guarantor, pursuant to a
supplemental indenture in form and substance reasonably
satisfactory to the Trustee, under the Senior Notes, the
Indenture and the Subsidiary Guarantee on the terms set
forth herein or therein; and
(ii) immediately after giving effect to such transaction, no
Default or Event of Default exists.
(b) In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory
in form to the Trustee, of the Subsidiary Guarantee endorsed upon
the Notes and the due and punctual performance of all of the
covenants and conditions of the Indenture to be performed by the
Guarantor, such successor corporation shall succeed to and be
substituted for the Guarantor with the same effect as if it had
been named herein as a Guarantor. Such successor corporation
thereupon may cause to be signed any or all of the Subsidiary
Guarantees to be endorsed upon all of the Notes issuable hereunder
which theretofore shall not have been signed by the Company and
delivered to the Trustee. All the Subsidiary Guarantees so issued
shall in all respects have the same legal rank and benefit under
the Indenture as the Subsidiary Guarantees theretofore and
thereafter issued in accordance with the terms of the Indenture as
though all of such Subsidiary Guarantees had been issued at the
date of the execution hereof.
(c) Except as set forth in Articles 4 and 5 of the Indenture, and
notwithstanding clauses (a) and (b) above, nothing contained in
the Indenture or in any of the Senior Notes shall prevent any
consolidation or merger of a Guarantor with or into the Company or
another Guarantor, or shall prevent any sale or conveyance of the
property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.
5. RELEASES.
(a) In the event of a sale or other disposition of all of the assets
of any Guarantor, by way of merger, consolidation or otherwise, or
a sale or other disposition of all to the capital stock of any
Guarantor, then such Guarantor (in the event of a sale or other
disposition, by way of merger, consolidation or otherwise, of all
of the capital stock of such Guarantor) or the corporation
acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such
Guarantor) will be released and relieved of any obligations under
its Subsidiary Guarantee; provided that the Net Proceeds of such
sale or other disposition are applied in accordance with the
applicable provisions of the Indenture, including without
limitation Section 4.10 of the Indenture. Upon delivery by the
Company to the Trustee of an Officers' Certificate and an Opinion
of Counsel to the effect that such sale or other disposition was
made by the Company in accordance with the provisions of the
Indenture, including without limitation Section 4.10 of the
Indenture, the Trustee shall execute any documents reasonably
required in order to evidence the release of any Guarantor from
its obligations under its Subsidiary Guarantee.
(b) Any Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of
principal of and interest on the Senior Notes and for the other
obligations of any Guarantor under the Indenture as provided in
Article 10 of the Indenture.
6. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator, stockholder or agent of the Guaranteeing
Subsidiary, as such, shall have any liability for any obligations of the
Company or any Guaranteeing Subsidiary under the Senior Notes, any
Subsidiary Guarantees, the Indenture or this Supplemental Indenture or for
any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder of the Senior Notes by accepting a Senior Note
waives and releases all such liability. The waiver and release are part of
the consideration for issuance of the Senior Notes. Such waiver may not be
effective to waive liabilities under the federal securities laws and it is
the view of the Commission that such a waiver is against public policy.
7. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK
SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT
WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE
EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE
REQUIRED THEREBY.
8. COUNTERPARTS The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
9. EFFECT OF HEADINGS. The Section headings herein are for convenience
only and shall not affect the construction hereof.
10. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the recitals contained
herein, all of which recitals are made solely by the Guaranteeing
Subsidiary and the Company.
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed and attested, all as of the date
first above written.
Dated: ____________ ___, ____ [GUARANTEEING SUBSIDIARY]
By: _______________________________
Name:
Title:
XXXXXXX GUARANTORS:
XXXXXXX, INC.
ALL AMERICAN SPORTS CORPORATION
EQUILINK LICENSING CORP.
PROACQ CORPORATION
RHC LICENSING CORP.
RIDMARK CORPORATION
CHEER ACQUISITION CORP.
By: _______________________________
Name:
Title:
VARSITY GUARANTORS:
VARSITY SPIRIT CORPORATION
VARSITY SPIRIT FASHIONS & SUPPLIES, INC.
VARSITY USA, INC.
VARSITY/INTROPA TOURS, INC.
INTERNATIONAL LOGOS, INC.
By: ________________________________
Name:
Title:
MARINE MIDLAND BANK
as Trustee
By: ___________________________
Name:
Title:
Schedule I
SCHEDULE OF GUARANTORS
The following schedule lists each Guarantor under the Indenture
as of the Issue Date:
All American Sports Corporation
Xxxxxxx, Inc.
RHC Licensing Corporation
Ridmark Corporation
Equilink Licensing Corporation
Proacq Corp.
Cheer Acquisition Corp.
Varsity Spirit Corporation
Varsity Spirit Fashions & Supplies, Inc.
International Logos, Inc.
Varsity/Intropa Tours, Inc.
Varsity USA, Inc.
