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EXHIBIT 4.01
EXECUTION COPY
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XXXXXXXXX SEMICONDUCTOR CORPORATION,
Issuer
FSC SEMICONDUCTOR CORPORATION,
Guarantor
XXXXXXXXX SEMICONDUCTOR CORPORATION OF CALIFORNIA,
Guarantor
10-3/8% Senior Subordinated Notes Due 2007
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INDENTURE
Dated as of April 7, 1999
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UNITED STATES TRUST COMPANY OF NEW YORK,
Trustee
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CROSS-REFERENCE TABLE
TIA Indenture
SECTION Section
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310(a)(1) .............................. 7.10
(a)(2) .............................. 7.10
(a)(3) .............................. N.A.
(a)(4) .............................. N.A.
(b) .............................. 7.08; 7.10
(c) .............................. N.A.
311(a) .............................. 7.11
(b) .............................. 7.11
(c) .............................. N.A.
312(a) .............................. 2.05
(b) .............................. 13.03
(c) .............................. 13.03
313(a) .............................. 7.06
(b)(1) .............................. N.A.
(b)(2) .............................. 7.06
(c) .............................. 13.02
(d) .............................. 7.06
314(a) .............................. 4.02;
4.11; 13.02
(b) .............................. N.A.
(c)(1) .............................. 13.04
(c)(2) .............................. 13.04
(c)(3) .............................. N.A.
(d) .............................. N.A.
(e) .............................. 13.05
(f) .............................. 4.11
315(a) .............................. 7.01
(b) .............................. 7.05; 13.02
(c) .............................. 7.01
(d) .............................. 7.01
(e) .............................. 6.11
316(a)(last sentence) .............................. 13.06
(a)(1)(A) .............................. 6.05
(a)(1)(B) .............................. 6.04
(a)(2) .............................. N.A.
(b) .............................. 6.07
317(a)(1) .............................. 6.08
(a)(2) .............................. 6.09
(b) .............................. 2.04
318(a) .............................. 13.01
N.A. means Not Applicable.
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Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
Exhibit A - Form of Security
Rule 144A/Regulation S Appendix
Exhibit 1 to Rule 144A/Regulation S Appendix
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TABLE OF CONTENTS
PAGE
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions .............................................. 1
SECTION 1.02. Other Definitions ........................................ 28
SECTION 1.03. Incorporation by Reference of Trust Indenture Act ........ 28
SECTION 1.04. Rules of Construction .................................... 29
ARTICLE 2
THE SECURITIES
SECTION 2.01. Form and Dating .......................................... 30
SECTION 2.02. Execution and Authentication ............................. 30
SECTION 2.03. Registrar and Paying Agent ............................... 31
SECTION 2.04. Paying Agent To Hold Money in Trust....................... 31
SECTION 2.05. Securityholder Lists ..................................... 32
SECTION 2.06. Transfer and Exchange .................................... 32
SECTION 2.07. Replacement Securities ................................... 33
SECTION 2.08. Outstanding Securities ................................... 33
SECTION 2.09. Temporary Securities ..................................... 34
SECTION 2.10. Cancellation ............................................. 34
SECTION 2.11. Defaulted Interest ....................................... 34
SECTION 2.12. CUSIP Numbers ............................................ 35
SECTION 2.13. Issuance of Additional Securities......................... 35
ARTICLE 3
REDEMPTION
SECTION 3.01. Notices to Trustee ....................................... 36
SECTION 3.02. Selection of Securities To Be Redeemed ................... 36
SECTION 3.03. Notice of Redemption ..................................... 36
SECTION 3.04. Effect of Notice of Redemption ........................... 37
SECTION 3.05. Deposit of Redemption Price .............................. 38
SECTION 3.06. Securities Redeemed in Part .............................. 38
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ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Securities .................................... 38
SECTION 4.02. SEC Reports .............................................. 38
SECTION 4.03. Limitation on Indebtedness ............................... 39
SECTION 4.04. Limitation on Restricted Payments ........................ 42
SECTION 4.05. Limitation on Restrictions on
Distributions from Restricted Subsidiaries.............. 46
SECTION 4.06. Limitation on Sales of Assets and
Subsidiary Stock ....................................... 47
SECTION 4.07. Limitation on Affiliate Transactions ..................... 52
SECTION 4.08. Limitation on the Sale or Issuance of
Capital Stock of Restricted Subsidiaries ............... 53
SECTION 4.09. Change of Control ........................................ 54
SECTION 4.10. Future Guarantors ........................................ 55
SECTION 4.11. Compliance Certificate ................................... 56
SECTION 4.12. Further Instruments and Acts ............................. 56
ARTICLE 5
SUCCESSOR COMPANIES
SECTION 5.01. When Company May Merge or Transfer Assets ................ 56
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default ........................................ 59
SECTION 6.02. Acceleration ............................................. 61
SECTION 6.03. Other Remedies ........................................... 62
SECTION 6.04. Waiver of Past Defaults .................................. 62
SECTION 6.05. Control by Majority ...................................... 63
SECTION 6.06. Limitation on Suits ...................................... 63
SECTION 6.07. Rights of Holders To Receive Payment ..................... 64
SECTION 6.08. Collection Suit by Trustee ............................... 64
SECTION 6.09. Trustee May File Proofs of Claim ......................... 64
SECTION 6.10. Priorities ............................................... 64
SECTION 6.11. Undertaking for Costs .................................... 65
SECTION 6.12. Waiver of Stay or Extension Laws ......................... 65
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ARTICLE 7
TRUSTEE
SECTION 7.01. Duties of Trustee ........................................ 65
SECTION 7.02. Rights of Trustee ........................................ 67
SECTION 7.03. Individual Rights of Trustee ............................. 67
SECTION 7.04. Trustee's Disclaimer ..................................... 68
SECTION 7.05. Notice of Defaults ....................................... 68
SECTION 7.06. Reports by Trustee to Holders ............................ 68
SECTION 7.07. Compensation and Indemnity ............................... 68
SECTION 7.08. Replacement of Trustee ................................... 69
SECTION 7.09. Successor Trustee by Merger .............................. 70
SECTION 7.10. Eligibility; Disqualification ............................ 71
SECTION 7.11. Preferential Collection of Claims Against Company ........ 71
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Liability on Securities; Defeasance ......... 71
SECTION 8.02. Conditions to Defeasance ................................. 73
SECTION 8.03. Application of Trust Money ............................... 74
SECTION 8.04. Repayment to Company ..................................... 74
SECTION 8.05. Indemnity for Government Obligations ..................... 74
SECTION 8.06. Reinstatement ............................................ 74
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Holders ............................... 75
SECTION 9.02. With Consent of Holders .................................. 76
SECTION 9.03. Compliance with Trust Indenture .......................... 77
SECTION 9.04. Revocation and Effect of Consents and Waivers ............ 77
SECTION 9.05. Notation on or Exchange of Securities .................... 78
SECTION 9.06. Trustee To Sign Amendments ............................... 78
SECTION 9.07. Payment for Consent ...................................... 78
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ARTICLE 10
SUBORDINATION
SECTION 10.01. Agreement To Subordinate ................................... 79
SECTION 10.02. Liquidation, Dissolution, Bankruptcy ....................... 79
SECTION 10.03. Default on Senior Indebtedness ............................. 80
SECTION 10.04. Acceleration of Payment of Securities ...................... 82
SECTION 10.05. When Distribution Must Be Paid Over ........................ 82
SECTION 10.06. Subrogation ................................................ 82
SECTION 10.07. Relative Rights ............................................ 82
SECTION 10.08. Subordination May Not Be Impaired by Company ............... 83
SECTION 10.09. Rights of Trustee and Paying Agent ......................... 83
SECTION 10.10. Distribution or Notice to Representative ................... 83
SECTION 10.11. Article 10 Not To Prevent Events of
Default or Limit Right To Accelerate ..................... 83
SECTION 10.12. Trust Moneys Not Subordinated .............................. 84
SECTION 10.13. Trustee Entitled To Rely ................................... 84
SECTION 10.14. Trustee To Effectuate Subordination ........................ 84
SECTION 10.15. Trustee Not Fiduciary for Holders
of Senior Indebtedness ................................... 85
SECTION 10.16. Reliance by Holders of Senior Indebtedness on Subordination
Provisions ............................................... 85
ARTICLE 11
GUARANTIES
SECTION 11.01. Guaranties ................................................. 85
SECTION 11.02. Limitation on Liability; Contribution ...................... 88
SECTION 11.03. Successors and Assigns ..................................... 88
SECTION 11.04. No Waiver .................................................. 88
SECTION 11.05. Modification ............................................... 88
SECTION 11.06. Release of Subsidiary Guarantor ............................ 89
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ARTICLE 12
SUBORDINATION OF GUARANTIES
SECTION 12.01. Agreement to Subordinate ................................... 89
SECTION 12.02. Liquidation, Dissolution, Bankruptcy ....................... 89
SECTION 12.03. Default on Senior Indebtedness of Guarantor ................ 90
SECTION 12.04. Demand for Payment ......................................... 91
SECTION 12.05. When Distribution Must Be Paid Over ........................ 91
SECTION 12.06. Subrogation ................................................ 91
SECTION 12.07. Relative Rights ............................................ 92
SECTION 12.08. Subordination May Not Be Impaired by Company ............... 92
SECTION 12.09. Rights of Trustee and Paying Agent ......................... 92
SECTION 12.10. Distribution or Notice to Representative ................... 93
SECTION 12.11. Article 12 Not to Prevent Defaults
Under a Guaranty or Limit Right To Demand Payment ........ 93
SECTION 12.12. Trustee Entitled To Rely ................................... 93
SECTION 12.13. Trustee To Effectuate Subordination ........................ 93
SECTION 12.14. Trustee Not Fiduciary for Holders of
Senior Indebtedness of Guarantor ......................... 94
SECTION 12.15. Reliance by Holders of Senior
Indebtedness on Subordination Provisions ................. 94
ARTICLE 13
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls ............................... 94
SECTION 13.02. Notices .................................................... 94
SECTION 13.03. Communication by Holders with Other Holders ................ 95
SECTION 13.04. Certificate and Opinion as to Conditions Precedent ......... 95
SECTION 13.05. Statements Required in Certificate or Opinion .............. 96
SECTION 13.06. When Securities Disregarded ................................ 96
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar ............... 96
SECTION 13.08. Legal Holidays ............................................. 96
SECTION 13.09. Governing Law .............................................. 97
SECTION 13.10. No Recourse Against Others ................................. 97
SECTION 13.11. Successors ................................................. 97
SECTION 13.12. Multiple Originals ......................................... 97
SECTION 13.13. Table of Contents; Headings ................................ 97
Exhibit A - Form of Security
Rule 144A/Regulation S Appendix
Exhibit 1 to Rule 144A/Regulation S Appendix
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INDENTURE dated as of April 7, 1999, among XXXXXXXXX
SEMICONDUCTOR CORPORATION, a Delaware corporation (the
"Company"), FSC SEMICONDUCTOR CORPORATION ("Parent"), as
Guarantor, XXXXXXXXX SEMICONDUCTOR CORPORATION OF
CALIFORNIA ("Fairchild California"), as Guarantor, and
UNITED STATES TRUST COMPANY OF NEW YORK, a New York
banking corporation (the "Trustee").
Each party agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the Holders of (1) the
Company's 103/8% Senior Subordinated Notes Due 2007 (the "Initial Securities"),
(2) if and when issued pursuant to a registered exchange for Initial Securities,
the Company's 103/8% Senior Subordinated Notes Due 2007 (the "Exchange
Securities"), (3) if and when issued pursuant to a private exchange for Initial
Securities, the Company's 103/8% Senior Subordinated Notes Due 2007 (the
"Private Exchange Securities"), and (4) if and when issued any Additional
Securities (as defined herein, and together with the Private Exchange
Securities, the Exchange Securities and the Initial Securities, the
"Securities"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. DEFINITIONS.
"Acquisition Closing Date" means the date the Company
consummates the acquisition of the Power Device Business from Samsung
Electronics Co., Ltd.
"Additional Assets" means (1) any property or assets (other
than Indebtedness and Capital Stock) in a Related Business; (2) the Capital
Stock of a Person that becomes a Restricted Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another Restricted
Subsidiary; or (3) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; PROVIDED, HOWEVER, that any such
Restricted Subsidiary described in clauses (2) or (3) above is primarily engaged
in a Related Business.
"Additional Securities" means, subject to the Company's
compliance with Section 4.03, 103/8% Senior Subordinated Notes Due 2007 issued
from time to time after
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the Issue Date under the terms of this Indenture (other than pursuant to Section
2.06, 2.07, 2.09 or 3.06 and other than Exchange Securities or Private Exchange
Securities issued pursuant to an exchange offer for other Securities
outstanding under this Indenture).
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 4.04, 4.06 and 4.07 only, "Affiliate" shall also mean any
beneficial owner of Capital Stock representing 10% or more of the total voting
power of the Voting Stock (on a fully diluted basis) of the Company or of rights
or warrants to purchase such Capital Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of (1) any shares of Capital
Stock of a Restricted Subsidiary (other than directors' qualifying shares or
shares required by applicable law to be held by a Person other than the Company
or a Restricted Subsidiary), (2) all or substantially all the assets of any
division or line of business of the Company or any Restricted Subsidiary or (3)
any other assets of the Company or any Restricted Subsidiary outside of the
ordinary course of business of the Company or such Restricted Subsidiary (other
than, in the case of (1), (2) and (3) above, (x) a disposition by a Restricted
Subsidiary to the Company or by the Company or a Restricted Subsidiary to a
Wholly Owned Subsidiary, (y) for purposes of Section 4.06 only, a disposition
that constitutes a Restricted Payment permitted by Section 4.04 and (z)
disposition of assets with a fair market value of less than $100,000).
"Attributable Debt" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate borne by the Securities, compounded annually) of the total
obligations of
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the lessee for rental payments during the remaining term of the lease included
in such Sale/Leaseback Transaction (including any period for which such lease
has been extended).
"Average Life" means, as of the date of determination, with
respect to any Indebtedness or Preferred Stock, the quotient obtained by
dividing (1) the sum of the products of the numbers of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such
Preferred Stock multiplied by the amount of such payment by (2) the sum of all
such payments.
"Banks" has the meaning specified in the Credit Agreement.
"Bank Indebtedness" means all Obligations pursuant to the
Credit Agreement.
"Board of Directors" means the Board of Directors of the
Company or any committee thereof duly authorized to act on behalf of such Board.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligations" means an obligation that is
required to be classified and accounted for as a capital lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be terminated by the
lessee without payment of a penalty.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Change of Control" means the occurrence of any of
the following events:
(1) prior to the earlier to occur of (A) the first public
offering of common stock of Parent or
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(B) the first public offering of common stock of the Company, the
Permitted Holders cease to be the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly,
of a majority in the aggregate of the total voting power of the Voting
Stock of the Company, whether as a result of issuance of securities of
the Parent or the Company, any merger, consolidation, liquidation or
dissolution of the Parent or the Company, any direct or indirect
transfer of securities by Parent or otherwise (for purposes of this
clause (1) and clauses (2) and (4) below, the Permitted Holders shall
be deemed to beneficially own any Voting Stock of a Person (the
"specified entity") held by any other Person (the "parent entity") so
long as the Permitted Holders beneficially own (as so defined),
directly or indirectly, in the aggregate a majority of the voting power
of the Voting Stock of the parent entity) PROVIDED, HOWEVER, that
notwithstanding the foregoing CVC shall be deemed to beneficially own a
majority of the voting power of the Voting Stock of Sterling (or any
successor) so long as CVC, employees, officers and directors of CVC and
corporations, partnerships and other entities at least a majority of
the equity in which is held in the aggregate by CVC and its employees,
officers and directors hold in the aggregate no less than a majority of
the economic interests in Sterling (or such successor);
(2) after the earlier to occur of (A) the first public
offering of common stock of Parent or (B) the first public offering of
common stock of the Company, any "person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act), other than one or more
Permitted Holders, is or becomes the beneficial owner (as defined in
clause (1) above, except that for purposes of this clause (2) such
person shall be deemed to have "beneficial ownership" of all shares
that any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 35% of the total voting power of the Voting
Stock of the Company; PROVIDED, HOWEVER, that the Permitted Holders
beneficially own (as defined in clause (1) above), directly or
indirectly, in the aggregate a lesser percentage of the total voting
power of the Voting Stock of the Company than such other person and do
not have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the Board of Directors
(for the purposes of this clause (2), such other person shall be
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deemed to beneficially own any Voting Stock of a specified entity held
by a parent entity, if such other person is the beneficial owner (as
defined in this clause (2)), directly or indirectly, of more than 35%
of the voting power of the Voting Stock of such parent entity and the
Permitted Holders beneficially own (as defined in clause (1) above),
directly or indirectly, in the aggregate a lesser percentage of the
voting power of the Voting Stock of such parent entity and do not have
the right or ability by voting power, contract or otherwise to elect or
designate for election a majority of the board of directors of such
parent entity);
(3) individuals who on the Issue Date constituted the Board of
Directors (together with any new directors (a) whose election by such
Board of Directors or whose nomination for election by the stockholders
of the Company was approved by a vote of a majority of the directors of
the Company then still in office who were either directors on the Issue
Date or whose election or nomination for election was previously so
approved or (b) who were elected to the Board of Directors pursuant to
the Stockholders' Agreement, as amended, modified or supplemented from
time to time) cease for any reason to constitute a majority of the
Board of Directors then in office; or
(4) the merger or consolidation of the Company with or into
another Person or the merger of another Person with or into the
Company, or the sale of all or substantially all the assets of the
Company to another Person (other than a Person that is controlled by
the Permitted Holders), if the securities of the Company that are
outstanding immediately prior to such transaction and which represent
100% of the aggregate voting power of the Voting Stock of the Company
are changed into or exchanged for cash, securities or property, unless
pursuant to such transaction such securities are changed into or
exchanged for, in addition to any other consideration, securities of
the surviving Person or transferee that represent, immediately after
such transaction, at least a majority of the aggregate voting power of
the Voting Stock of the surviving Person or transferee.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the party named as such in this Indenture
until a successor replaces it and, thereafter,
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means the successor and, for purposes of any provision contained herein and
required by the TIA, each other obligor on the indenture securities.
"Consolidated Coverage Ratio" as of any date of determination
means the ratio of (a) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters ending at least 45 days (or, if less,
the number of days after the end of such fiscal quarter as the consolidated
financial statements of the Company shall be provided to the Securityholders
pursuant hereto) prior to the date of such determination to (b) Consolidated
Interest Expense for such four fiscal quarters; PROVIDED, HOWEVER, that:
(1) if the Company or any Restricted Subsidiary has Incurred
any Indebtedness since the beginning of such period that remains
outstanding or if the transaction giving rise to the need to calculate
the Consolidated Coverage Ratio is an Incurrence of Indebtedness, or
both, EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on the first day
of such period and the discharge of any other Indebtedness repaid,
repurchased, defeased or otherwise discharged with the proceeds of such
new Indebtedness as if such discharge had occurred on the first day of
such period;
(2) if the Company or any Restricted Subsidiary has repaid,
repurchased, defeased or otherwise discharged any Indebtedness since
the beginning of such period or if any Indebtedness is to be repaid,
repurchased, defeased or otherwise discharged (in each case other than
Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on
the date of the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio, EBITDA and Consolidated Interest Expense
for such period shall be calculated on a pro forma basis as if such
discharge had occurred on the first day of such period and as if the
Company or such Restricted Subsidiary has not earned the interest
income actually earned during such period in respect of cash or
Temporary Cash Investments used to repay, repurchase, defease or
otherwise discharge such Indebtedness;
(3) if since the beginning of such period the Company or any
Restricted Subsidiary shall have made
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any Asset Disposition, the EBITDA for such period shall be reduced by
an amount equal to the EBITDA (if positive) directly attributable to
the assets which are the subject of such Asset Disposition for such
period, or increased by an amount equal to the EBITDA (if negative),
directly attributable thereto for such period and Consolidated Interest
Expense for such period shall be reduced by an amount equal to the
Consolidated Interest Expense directly attributable to any Indebtedness
of the Company or any Restricted Subsidiary repaid, repurchased,
defeased or otherwise discharged with respect to the Company and its
continuing Restricted Subsidiaries in connection with such Asset
Disposition for such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period
directly attributable to the Indebtedness of such Restricted Subsidiary
to the extent the Company and its continuing Restricted Subsidiaries
are no longer liable for such Indebtedness after such sale);
(4) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Restricted Subsidiary (or any person which becomes a
Restricted Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction
requiring a calculation to be made hereunder, which constitutes all or
substantially all of an operating unit of a business, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of any
Indebtedness) as if such Investment or acquisition occurred on the
first day of such period; and
(5) if since the beginning of such period any Person (that
subsequently became a Restricted Subsidiary or was merged with or into
the Company or any Restricted Subsidiary since the beginning of such
period) shall have made any Asset Disposition, any Investment or
acquisition of assets that would have required an adjustment pursuant
to clause (3) or (4) above if made by the Company or a Restricted
Subsidiary during such period, EBITDA and Consolidated Interest Expense
for such period shall be calculated after giving pro forma effect
thereto as if such Asset Disposition, Investment or acquisition
occurred on the first day of such period.
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For purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings relating thereto and the
amount of Consolidated Interest Expense associated with any Indebtedness
Incurred in connection therewith, the pro forma calculations shall be determined
in good faith by a responsible financial or accounting Officer of the Company.
If any Indebtedness bears a floating rate of interest and is being given pro
forma effect, the interest of such Indebtedness shall be calculated as if the
rate in effect on the date of determination had been the applicable rate for the
entire period (taking into account any Interest Rate Agreement applicable to
such Indebtedness if such Interest Rate Agreement has a remaining term in excess
of 12 months).
"Consolidated Current Liabilities" as of the date of
determination means the aggregate amount of liabilities of the Company and its
consolidated Restricted Subsidiaries which may properly be classified as current
liabilities (including taxes accrued as estimated), on a consolidated basis,
after eliminating (1) all intercompany items between the Company and any
Restricted Subsidiary and (2) all current maturities of long-term Indebtedness,
all as determined in accordance with GAAP consistently applied.
"Consolidated Interest Expense" means, for any period, the
total interest expense of the Company and its consolidated Restricted
Subsidiaries, plus, to the extent not included in such total interest expense,
and to the extent incurred by the Company or its Restricted Subsidiaries,
without duplication:
(1) interest expense attributable to Capital Lease
Obligations and the interest expense attributable to
leases constituting part of a Sale/Leaseback
Transaction;
(2) amortization of debt discount and debt issuance cost;
(3) capitalized interest;
(4) non-cash interest expenses;
(5) commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers'
acceptance financing;
(6) net costs associated with Hedging Obligations
involving any Interest Rate Agreement (including
amortization of fees);
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(7) Preferred Stock dividends accrued by consolidated
Restricted Subsidiaries in respect of all Preferred
Stock held by Persons other than the Company or a
Restricted Subsidiary;
(8) interest incurred in connection with Investments in
discontinued operations;
(9) interest accruing on any Indebtedness of any other
Person to the extent such Indebtedness is Guaranteed
by (or secured by the assets of) the Company or any
Restricted Subsidiary; and
(10) the cash contributions to any employee stock
ownership plan or similar trust to the extent such
contributions are used by such plan or trust to pay
interest or fees to any Person (other than the
Company) in connection with Indebtedness Incurred by
such plan or trust.
"Consolidated Net Income" means, for any period, the net
income of the Company and its consolidated Subsidiaries; PROVIDED, HOWEVER,
that there shall not be included in such Consolidated Net Income:
(1) any net income of any Person (other than the Company) if
such Person is not a Restricted Subsidiary, except that (A) subject to
the exclusion contained in clause (4) below, the Company's equity in
the net income of any such Person for such period shall be included in
such Consolidated Net Income up to the aggregate amount of cash
actually distributed by such Person during such period to the Company
or a Restricted Subsidiary as a dividend or other distribution
(subject, in the case of a dividend or other distribution paid to a
Restricted Subsidiary, to the limitations contained in clause (3)
below) and (B) the Company's equity in a net loss of any such Person
for such period shall be included in determining such Consolidated Net
Income;
(2) any net income (or loss) of any Person acquired by the
Company or a Subsidiary in a pooling of interests transaction for any
period prior to the date of such acquisition;
(3) any net income of any Restricted Subsidiary if such
Restricted Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or
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the making of distributions by such Restricted Subsidiary, directly or
indirectly, to the Company, except that (A) subject to the exclusion
contained in clause (4) below, the Company's equity in the net income
of any such Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of cash that
could have been distributed by such Restricted Subsidiary consistent
with such restrictions during such period to the Company or another
Restricted Subsidiary as a dividend or other distribution (subject, in
the case of a dividend or other distribution paid to another Restricted
Subsidiary, to the limitation contained in this clause) and (B) the
Company's equity in a net loss of any such Restricted Subsidiary for
such period shall be included in determining such Consolidated Net
Income;
(4) any gain (or loss) realized upon the sale or other
disposition of any assets of the Company or its consolidated
Subsidiaries (including pursuant to any sale-and-leaseback arrangement)
which is not sold or otherwise disposed of in the ordinary course of
business and any gain (or loss) realized upon the sale or other
disposition of any Capital Stock of any Person;
(5) extraordinary gains or losses; and
(6) the cumulative effect of a change in accounting
principles.
Notwithstanding the foregoing, for the purpose of Section 4.04 only, there shall
be excluded from Consolidated Net Income any dividends, repayments of loans or
advances or other transfers of assets from Unrestricted Subsidiaries to the
Company or a Restricted Subsidiary to the extent such dividends, repayments or
transfers increase the amount of Restricted Payments permitted under such
Section pursuant to clause (a)(3)(D) thereof.
"Consolidated Net Tangible Assets" as of any date of
determination, means the total amount of assets (less accumulated depreciation
and amortization, allowances for doubtful receivables, other applicable reserves
and other properly deductible items) which would appear on a consolidated
balance sheet of the Company and its consolidated Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, and after giving
effect to purchase accounting and after deducting therefrom
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Consolidated Current Liabilities and, to the extent otherwise included, the
amounts of:
(1) minority interests in consolidated Subsidiaries held by
Persons other than the Company or a Restricted Subsidiary;
(2) excess of cost over fair value of assets of businesses
acquired, as determined in good faith by the Board of Directors;
(3) any revaluation or other write-up in book value of assets
subsequent to the Issue Date as a result of a change in the method of
valuation in accordance with GAAP consistently applied;
(4) unamortized debt discount and expenses and other
unamortized deferred charges, goodwill, patents, trademarks, service
marks, trade names, copyrights, licenses, organization or developmental
expenses and other intangible items;
(5) treasury stock;
(6) cash set apart and held in a sinking or other analogous
fund established for the purpose of redemption or other retirement of
Capital Stock to the extent such obligation is not reflected in
Consolidated Current Liabilities; and
(7) Investments in and assets of Unrestricted Subsidiaries.
"Consolidated Net Worth" means the total of the amounts shown
on the balance sheet of the Company and its consolidated Subsidiaries,
determined on a consolidated basis in accordance with GAAP, as of the end of the
most recent fiscal quarter of the Company ending at least 45 days prior to the
taking of any action for the purpose of which the determination is being made,
as (1) the par or stated value of all outstanding Capital Stock of the Company
plus (2) paid-in capital or capital surplus relating to such Capital Stock plus
(3) any retained earnings or earned surplus less (A) any accumulated deficit and
(B) any amounts attributable to Disqualified Stock.
"Credit Agreement" means (1) prior to the Acquisition Closing
Date, the Credit Agreement, as amended, dated as of March 11, 1997, by and among
Xxxxxxxxx Holdings, the Company, certain of its Subsidiaries, the lenders
referred to therein, Bankers Trust Company, as
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Administrative Agent, Credit Suisse First Boston, as Syndication Agent, and
Canadian Imperial Bank of Commerce, as Documentation Agent, together with the
related documents thereto and (2) on or after the Acquisition Closing Date, the
Credit Agreement to be entered into by and among Parent, the Company, certain of
its Subsidiaries, the lenders referred to therein, Credit Suisse First Boston,
as Administrative Agent, together with the related documents thereto (including
without limitation the term loans and revolving loans thereunder, any guarantees
and security documents), as amended, extended, renewed, restated, supplemented
or otherwise modified (in whole or in part, and without limitation as to amount,
terms, conditions, covenants and other provisions) from time to time, and any
agreement (and related document) governing Indebtedness incurred to refund or
refinance, in whole or in part, the borrowings and commitments then outstanding
or permitted to be outstanding under such Credit Agreement or a successor Credit
Agreement, whether by the same or any other lender or group of lenders.
"Currency Agreement" means in respect of a Person any foreign
exchange contract, currency swap agreement or other similar agreement to which
such Person is a party or beneficiary.
"CVC" means Citicorp Venture Capital Ltd.
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Designated Senior Indebtedness" means (1) the Bank
Indebtedness; PROVIDED, HOWEVER, that Bank Indebtedness outstanding under any
Credit Agreement that Refinanced in part, but not in whole, the previously
outstanding Bank Indebtedness shall only constitute Designated Senior
Indebtedness if it meets the requirements of succeeding clause (2); and (2) any
other Senior Indebtedness of the Company which, at the date of determination,
has an aggregate principal amount outstanding of, or under which, at the date of
determination, the holders thereof are committed to lend up to, at least $10.0
million and is specifically designated by the Company in the instrument
evidencing or governing such Senior Indebtedness as "Designated Senior
Indebtedness" for purposes of this Indenture.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock which by its terms (or by the terms of any security into which it
is convertible or for
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which it is exchangeable) or upon the happening of any event (1) matures or is
mandatorily redeemable pursuant to a sinking fund obligation or otherwise, (2)
is convertible or exchangeable for Indebtedness or Disqualified Stock or (3) is
redeemable at the option of the holder thereof, in whole or in part, in each
case on or prior to the first anniversary of the Stated Maturity of the
Securities; PROVIDED, HOWEVER, that any Capital Stock that would not constitute
Disqualified Stock but for provisions thereof giving holders thereof the right
to require such Person to repurchase or redeem such Capital Stock upon the
occurrence of an "asset sale" or "change of control" occurring prior to the
first anniversary of the Stated Maturity of the Securities shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are not more favorable to the holders of such
Capital Stock than the provisions of Sections 4.06 and 4.09.
"EBITDA" for any period means the sum of Consolidated Net
Income, plus Consolidated Interest Expense plus the following to the extent
deducted in calculating
such Consolidated Net Income:
(1) all income tax expense of the Company and its consolidated
Restricted Subsidiaries;
(2) depreciation expense of the Company and its consolidated
Restricted Subsidiaries;
(3) amortization expense of the Company and its consolidated
Restricted Subsidiaries (excluding amortization expense attributable to
a prepaid cash item that was paid in a prior period); and
(4) all other non-cash charges of the Company and its
consolidated Restricted Subsidiaries (excluding any such non-cash
charge to the extent that it represents an accrual of or reserve for
cash expenditures in any future period):
in each case for such period. Notwithstanding the foregoing, the provision for
taxes based on the income or profits of, and the depreciation and amortization
and non-cash charges of, a Restricted Subsidiary shall be added to Consolidated
Net Income to compute EBITDA only to the extent (and in the same proportion)
that the net income of such Restricted Subsidiary was included in calculating
Consolidated Net Income and only if a corresponding amount would be permitted at
the date of determination to be dividended to the Company by such Restricted
Subsidiary
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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 such Restricted
Subsidiary or its stockholders.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Foreign Subsidiary" means any Restricted Subsidiary not
created or organized in the United States of America or any State thereof and
that conducts substantially all its operations outside of the United States.
"GAAP" means generally accepted accounting principles in the
United States of America as in effect as of the Issue Date, including those set
forth in (1) the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants, (2) statements and
pronouncements of the Financial Accounting Standards Board, (3) such other
statements by such other entity as approved by a significant segment of the
accounting profession and (4) the rules and regulations of the SEC governing the
inclusion of financial statements (including pro forma financial statements) in
periodic reports required to be filed pursuant to Section 13 of the Exchange
Act, including opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the SEC. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness of any other
Person and any obligation, direct or indirect, contingent or otherwise, of such
Person (1) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation of such Person (whether
arising by virtue of partnership arrangements, or by agreements to keep-well, to
purchase assets, goods, securities or services, to take-or-pay or to maintain
financial statement conditions or otherwise) or (2) entered into for the purpose
of assuring in any other manner the obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); PROVIDED, HOWEVER, that the term "Guarantee" shall not include
endorsements for collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb has a corresponding meaning.
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"Guarantor" means the Parent and each Subsidiary Guarantor.
"Guaranty" means the Parent Guaranty or any
Subsidiary Guaranty.
"Guaranty Agreement" means a supplemental indenture, in a form
satisfactory to the Trustee, pursuant to which a successor to Parent or
Xxxxxxxxx California, or any Subsidiary Guarantor other than Xxxxxxxxx
California, becomes subject to the applicable terms and conditions hereof.
"Hedging Obligations" of any Person means the obligations of
such Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise
become liable for; PROVIDED, HOWEVER, that any Indebtedness or Capital Stock of
a Person existing at the time such Person becomes a Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred
by such Subsidiary at the time it becomes a Subsidiary. The term "Incurrence"
when used as a noun shall have a correlative meaning. The accretion of principal
of a non-interest bearing or other discount security shall not be deemed the
Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person on any date
of determination (without duplication):
(1) the principal of and premium (if any) in respect of (A)
indebtedness of such Person for money borrowed and (B) indebtedness
evidenced by notes, debentures, bonds or other similar instruments for
the payment of which such Person is responsible or liable;
(2) all Capital Lease Obligations of such Person and all
Attributable Debt in respect of Sale/Leaseback Transactions entered
into by such Person;
(3) all obligations of such Person issued or assumed as the
deferred purchase price of property, all conditional sale obligations
of such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable arising in
the ordinary course of business);
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(4) all obligations of such Person for the reimbursement of
any obligor on any letter of credit, banker's acceptance or similar
credit transaction (other than obligations with respect to letters of
credit securing obligations (other than obligations described in
clauses (1) through (3) above) entered into in the ordinary course of
business of such Person to the extent such letters of credit are not
drawn upon or, if and to the extent drawn upon, such drawing is
reimbursed no later than the tenth Business Day following payment on
the letter of credit);
(5) the amount of all obligations of such Person with respect
to the redemption, repayment or other repurchase of any Disqualified
Stock or, with respect to any Subsidiary of such Person, the
liquidation preference with respect to, any Preferred Stock (but
excluding, in each case, any accrued dividends);
(6) all obligations of the type referred to in clauses (1)
through (5) of other Persons and all dividends of other Persons for the
payment of which, in either case, such Person is responsible or liable,
directly or indirectly, as obligor, guarantor or otherwise, including
by means of any Guarantee;
(7) all obligations of the type referred to in clauses (1)
through (6) of other Persons secured by any Lien on any property or
asset of such Person (whether or not such obligation is assumed by such
Person), the amount of such obligation being deemed to be the lesser of
the value of such property or assets or the amount of the obligation so
secured; and
(8) to the extent not otherwise included in this definition,
Hedging Obligations of such Person.
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and the
maximum liability, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date; PROVIDED, HOWEVER, that
the amount outstanding at any time of any Indebtedness issued with original
issue discount shall be deemed to be the face amount of such Indebtedness less
the remaining unamortized portion of the original issue discount of such
indebtedness at such time as determined in accordance with GAAP.
"Indenture" means this Indenture as amended or supplemented
from time to time.
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"Interest Rate Agreement" means in respect of a Person any
interest rate swap agreement, interest rate cap agreement or other financial
agreement or arrangement designed to protect such Person against fluctuations in
interest rates.
"Investment" in any Person means any direct or indirect
advance, loan (other than advances to customers in the ordinary course of
business that are recorded as accounts receivable on the balance sheet of the
lender) or other extensions of credit (including by way of Guarantee or similar
arrangement) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the account
or use of others), or any purchase or acquisition of Capital Stock, Indebtedness
or other similar instruments issued by such Person. For purposes of the
definition of "Unrestricted Subsidiary", the definition of "Restricted Payment"
and Section 4.04:
(1) "Investment" shall include the portion (proportionate to
the Company's equity interest in such Subsidiary) of the fair market
value of the net assets of any Subsidiary of the Company at the time
that such Subsidiary is designated an Unrestricted Subsidiary;
PROVIDED, HOWEVER, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company shall be deemed to continue to have
a permanent "Investment" in an Unrestricted Subsidiary equal to an
amount (if positive) equal to (x) the Company's "Investment" in such
Subsidiary at the time of such redesignation less (y) the portion
(proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of such Subsidiary at the time
of such redesignation; and
(2) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of
Directors.
"Issue Date" means the date on which the Initial Securities
are originally issued.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof).
"Net Available Cash" from an Asset Disposition means cash
payments received therefrom (including any cash
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payments received by way of deferred payment of principal pursuant to a note or
installment receivable or otherwise and proceeds from the sale or other
disposition of any securities received as consideration, but only as and when
received, but excluding any other consideration received in the form of
assumption by the acquiring Person of Indebtedness or other obligations relating
to such properties or assets or received in any other non-cash form), in each
case net of:
(1) all legal, title and recording tax expenses, commissions
and other fees and expenses incurred, and all Federal, state,
provincial, foreign and local taxes required to be accrued as a
liability under GAAP, as a consequence of such Asset Disposition;
(2) all payments made on any Indebtedness which is secured by
any assets subject to such Asset Disposition, in accordance with the
terms of any Lien upon or other security agreement of any kind with
respect to such assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by applicable
law, be repaid out of the proceeds from such Asset Disposition;
(3) all distributions and other payments required to be made
to minority interest holders in Subsidiaries or joint ventures as a
result of such Asset Disposition; and
(4) the deduction of appropriate amounts provided by the
seller as a reserve, in accordance with GAAP, against any liabilities
associated with the property or other assets disposed in such Asset
Disposition and retained by the Company or any Restricted Subsidiary
after such Asset Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of
Capital Stock, means the cash proceeds of such issuance or sale net of
attorneys' fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"Obligations" means with respect to any Indebtedness all
obligations for principal, premium, interest, penalties, fees, indemnifications,
reimbursements and other amounts payable pursuant to the documentation governing
such Indebtedness.
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"Officer" means the Chairman of the Board, the President, any
Vice President, the Treasurer or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal
counsel who is acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Parent" means FSC Semiconductor Corporation, a Delaware
corporation.
"Parent Guaranty" means the Guaranty by Parent of the
Company's obligations with respect to the Securities contained herein.
"Permitted Holders" means (1) CVC, (2) any officer, employee
or director of CVC or any trust, partnership or other entity established solely
for the benefit of such officers, employees or directors, (3) any officer,
employee or director of Parent, the Company or any Subsidiary or any trust,
partnership or other entity established solely for the benefit of such officers,
employees or directors, and (4) in the case of any individual, any Permitted
Transferee of such individual (as defined in the Stockholders' Agreement),
except a Permitted Transferee by virtue of Section 3.4(b)(iv) thereof; PROVIDED,
HOWEVER, that in no event shall individuals collectively be deemed to be
"Permitted Holders" with respect to more than 30% of the total voting power of
Parent or the Company.
"Permitted Investment" means an Investment by the Company or
any Restricted Subsidiary in:
(1) a Restricted Subsidiary or a Person that will, upon the
making of such Investment, become a Restricted Subsidiary; PROVIDED,
HOWEVER, that the primary business of such Restricted Subsidiary is a
Related Business;
(2) another Person if as a result of such Investment such
other Person is merged or consolidated with or into, or transfers or
conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary; PROVIDED, HOWEVER, that such Person's primary
business is a Related Business;
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(3) Temporary Cash Investments;
(4) receivables owing to the Company or any Restricted
Subsidiary if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms;
PROVIDED, HOWEVER, that such trade terms may include such concessionary
trade terms as the Company or any such Restricted Subsidiary deems
reasonable under the circumstances;
(5) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as
expenses for accounting purposes and that are made in the ordinary
course of business;
(6) loans or advances to employees made in the ordinary course
of business consistent with past practices of the Company or such
Restricted Subsidiary;
(7) stock, obligations or securities received in settlement of
debts created in the ordinary course of business and owing to the
Company or any Restricted Subsidiary or in satisfaction of judgments;
(8) any Person to the extent such Investment represents the
non-cash portion of the consideration received for an Asset Disposition
as permitted pursuant to Section 4.06;
(9) so long as no Default shall have occurred and be
continuing (or result therefrom), any Person engaged in a Related
Business in an aggregate amount which, when added together with the
amount of all the Investments made pursuant to this clause (9) which at
such time have not been repaid through repayments of loans or advances
or other transfers of assets, does not exceed $30.0 million.
"Person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any
Person, means Capital Stock of any class or classes (however designated) which
is preferred as to the payment of dividends or distributions, or as to the
distribution of assets upon any voluntary or involuntary liquidation or
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dissolution of such Person, over shares of Capital Stock of any other class of
such Person.
"principal" of a Security means the principal of the Security
plus the premium, if any, payable on the Security which is due or overdue or is
to become due at the relevant time.
"Public Equity Offering" means an underwritten primary public
offering of common stock of (1) the Company or (2) the Parent (to the extent the
proceeds thereof are contemporaneously contributed to the Company), in each case
pursuant to an effective registration statement under the Securities Act.
"Purchase Price Note" means the promissory note, not to exceed
$455.0 million, of the Company and Xxxxxxxxx Korea Semiconductor Ltd. to be
issued to Samsung Electronics Co., Ltd. on the Acquisition Closing Date for the
purchase price of the power device business of Samsung Electronics Co., Ltd.
"Refinance" means, in respect of any Indebtedness, to
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue other Indebtedness in exchange or replacement for, such indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances
any Indebtedness of the Company or any Restricted Subsidiary existing on the
Issue Date or Incurred in compliance with this Indenture, including Indebtedness
that Refinances Refinancing Indebtedness; PROVIDED, HOWEVER, that (1) such
Refinancing Indebtedness has a Stated Maturity no earlier than the Stated
Maturity of the Indebtedness being Refinanced, (2) such Refinancing Indebtedness
has an Average Life at the time such Refinancing Indebtedness is Incurred that
is equal to or greater than the Average Life of the Indebtedness being
Refinanced and (3) such Refinancing Indebtedness has an aggregate principal
amount (or if Incurred with original issue discount, an aggregate issue price)
that is equal to or less than the aggregate principal amount (or if Incurred
with original issue discount, the aggregate accreted value) then outstanding or
committed (plus fees and expenses, including any premium and defeasance costs)
under the Indebtedness being Refinanced; PROVIDED FURTHER, HOWEVER, that
Refinancing Indebtedness shall not include (x) Indebtedness of a Subsidiary that
Refinances Indebtedness of the Company or (y) Indebtedness
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of the Company or a Restricted Subsidiary that Refinances Indebtedness of an
Unrestricted Subsidiary.
"Related Business" means any business related, ancillary or
complementary to the businesses of the Company and the Restricted Subsidiaries
on the Issue Date.
"Representative" means any trustee, agent or representative
(if any) for an issue of Senior Indebtedness of the Company; PROVIDED, HOWEVER,
that if and for so long as any Senior Indebtedness lacks such a representative,
then the Representative for such Senior Indebtedness shall at all times be the
holders of a majority in outstanding principal amount of such Senior
Indebtedness.
"Restricted Payment" with respect to any Person means:
(1) the declaration or payment of any dividends or any other
distributions of any sort in respect of its Capital Stock (including
any payment in connection with any merger or consolidation involving
such Person) or similar payment to the direct or indirect holders of
its Capital Stock (other than dividends or distributions payable solely
in its Capital Stock (other than Disqualified Stock) and dividends or
distributions payable solely to the Company or a Restricted Subsidiary,
and other than pro rata dividends or other distributions made by a
Subsidiary that is not a Wholly Owned Subsidiary to minority
stockholders (or owners of an equivalent interest in the case of a
Subsidiary that is an entity other than a corporation));
(2) the purchase, redemption or other acquisition or
retirement for value of any Capital Stock of the Company held by any
Person or of any Capital Stock of a Restricted Subsidiary held by any
Affiliate of the Company (other than a Restricted Subsidiary),
including the exercise of any option to exchange any Capital Stock
(other than into Capital Stock of the Company that is not Disqualified
Stock);
(3) the purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment of any
Subordinated Obligations (other than the purchase, repurchase or other
acquisition of Subordinated Obligations purchased in anticipation of
satisfying a sinking fund obligation, principal installment or final
maturity, in
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each case due within one year of the date of acquisition); or
(4) the making of any Investment in any Person (other than a
Permitted Investment).
"Restricted Subsidiary" means any Subsidiary of the Company
that is not an Unrestricted Subsidiary.
"Revolving Credit Facilities" means the revolving credit
facility contained in the Credit Agreement and any other facility or financing
arrangement that Refinances or replaces, in whole or in part, any such revolving
credit facility.
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired whereby the Company or a Restricted
Subsidiary transfers such property to a Person and the Company or a Restricted
Subsidiary leases it from such Person.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company
secured by a Lien.
"Securities" means the Securities issued under this Indenture.
"Senior Indebtedness" of any Person means all (1) Bank
Indebtedness of or guaranteed by such Person, whether outstanding on the Issue
Date or thereafter Incurred, and (2) Indebtedness of such Person, whether
outstanding on the Issue Date or thereafter Incurred, including interest
thereon, in respect of (A) Indebtedness for money borrowed, (B) Indebtedness
evidenced by notes, debentures, bonds or other similar instruments for the
payment of which such Person is responsible or liable and (C) Hedging
Obligations, unless, in the case of (1) and (2), in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is provided
that such obligations are subordinate in right of payment to the obligations
under the Securities; PROVIDED, HOWEVER, that Senior Indebtedness shall not
include (i) any obligation of such Person to any subsidiary of such Person, (ii)
any liability for Federal, state, local or other taxes owed or owing by such
Person, (iii) any accounts payable or other liability to trade creditors arising
in the ordinary course of business (including guarantees thereof or instruments
evidencing such liabilities), (iv) any Indebted
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ness of such Person (and any accrued and unpaid interest in respect thereof)
which is subordinate or junior by its terms to any other Indebtedness or other
obligation of such Person (including, in the case of the Company, the Securities
and 10 1/8% Senior Subordinated Notes Due 2007 and, in the case of the Parent,
its 11.74% Subordinated Note due March 14, 2008 and 12.5% Subordinated PIK Note
due February 1, 2008) or (v) that portion of any Indebtedness which at the time
of Incurrence is Incurred in violation of this Indenture (but as to any such
Indebtedness under the Credit Agreement, no such violation shall be deemed to
exist if the Representative of the Lenders thereunder shall have received an
officers' certificate of the Company to the effect that the issuance of such
Indebtedness does not violate such covenant and setting forth in reasonable
detail the reasons therefor).
"Senior Subordinated Indebtedness" means (1) with respect to
the Company, the Securities, the 101/8% Senior Subordinated Notes Due 2007 and
any other Indebtedness of the Company that specifically provides that such
Indebtedness is to rank PARI PASSU with the Securities in right of payment and
is not subordinated by its terms in right of payment to any Indebtedness or
other obligation of the Company which is not Senior Indebtedness of the Company
and (2) with respect to the Parent or a Subsidiary Guarantor, their respective
Guarantees of the Securities and the 101/8% Senior Subordinated Notes Due 2007
and any other indebtedness of such Person that specifically provides that such
Indebtedness rank PARI PASSU with such Guarantee in respect of payment and is
not subordinated by its terms in respect of payment to any Indebtedness or other
obligation of such Person which is not Senior Indebtedness of such Person;
PROVIDED, HOWEVER, that Senior Subordinated Indebtedness shall not include, in
the case of the Parent, the 11.74% Subordinated Note due March 14, 2008.
"Significant Subsidiary" means any Restricted Subsidiary that
would be a "Significant Subsidiary" of the Company within the meaning of Rule
1-02 under Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency unless such contingency has occurred).
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"Sterling" means Sterling Holding Company LLC, a Delaware
limited liability company.
"Stockholders' Agreement" means the Securities Purchase and
Holders Agreement among the stockholders of Parent, as in effect on the Issue
Date.
"Subordinated Obligation" means any Indebtedness of the
Company or any Subsidiary Guarantor (whether outstanding on the Issue Date or
thereafter Incurred) which is subordinate or junior in right of payment to, in
the case of the Company, the Securities or, in the case of such Subsidiary
Guarantor, its Subsidiary Guaranty, pursuant to a written agreement to that
effect.
"Subsidiary" means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests (including
partnership interests) 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 (1) such Person,
(2) such Person and one or more Subsidiaries of such Person or (3) one or more
Subsidiaries of such Person.
"Subsidiary Guarantor" means Xxxxxxxxx California and any
other subsidiary of the Company that guarantees the Company's obligations with
respect to the Securities.
"Subsidiary Guaranty" means a Guarantee by a Subsidiary
Guarantor of the Company's obligations with respect to the Securities.
"Temporary Cash Investments" means any of the following:
(1) any investment in direct obligations of the United States
of America or any agency thereof or obligations guaranteed by the
United States of America or any agency thereof;
(2) investments in time deposit accounts, certificates of
deposit and money market deposits maturing within 180 days of the date
of acquisition thereof issued by a bank or trust company which is
organized under the laws of the United States of America, any state
thereof or any foreign country recognized by the United States of
America, and which bank or trust company has capital, surplus and
undivided profits aggregating in excess of $50.0
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million (or the foreign currency equivalent thereof) and has
outstanding debt that is rated "A" (or such similar equivalent rating)
or higher by at least one nationally recognized statistical rating
organization (as defined in Rule 436 under the Securities Act) or any
money-market fund sponsored by a registered broker dealer or mutual
fund distributor;
(3) repurchase obligations with a term of not more than 30
days for underlying securities of the types described in clause (1)
above entered into with a bank meeting the qualifications described in
clause (2) above;
(4) investments in commercial paper, maturing not more than 90
days after the date of acquisition, issued by a corporation (other than
an Affiliate of the Company) organized and in existence under the laws
of the United States of America or any foreign country recognized by
the United States of America with a rating at the time as of which any
investment therein is made of "P-1" (or higher) according to Xxxxx'x
Investors Service, Inc. or "A-1" (or higher) according to Standard and
Poor's Ratings Group; and
(5) investments in securities with maturities of six months or
less from the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States of America, or by
any political subdivision or taxing authority thereof, and rated at
least "A" by Standard & Poor's Ratings Group or "A" by Xxxxx'x
Investors Service, Inc.
"Term Loan Facilities" means the term loan facilities
contained in the Credit Agreement and any other facility or financing
arrangement that Refinances in whole or in part any such term loan facility.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of this Indenture.
"Trustee" means the party named as such in this Indenture
until a successor replaces it and, thereafter, means the successor.
"Trust Officer" means the Chairman of the Board, the President
or any other officer or assistant officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
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"Uniform Commercial Code" means the New York Uniform
Commercial Code as in effect from time to time.
"Unrestricted Subsidiary" means (1) any Subsidiary of the
Company that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors in the manner provided below and (2) any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate
any Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of,
or owns or holds any Lien on any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated; PROVIDED, HOWEVER, that either (A) the Subsidiary to be so
designated has total assets of $1,000 or less or (B) if such Subsidiary has
assets greater than $1,000, such designation would be permitted under Section
4.04. The Board of Directors may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; PROVIDED, HOWEVER, that immediately after giving effect
to such designation (x) the Company could Incur $1.00 of additional Indebtedness
under Section 4.03(a) and (y) no Default shall have occurred and be continuing.
Any such designation by the Board of Directors shall be evidenced to the Trustee
by promptly filing with the Trustee a copy of the resolution of the Board of
Directors giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Voting Stock" of a Person means all classes of Capital Stock
or other interests (including partnership interests) of such Person then
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof.
"Wholly Owned Subsidiary" means a Restricted Subsidiary all
the Capital Stock of which (other than directors' qualifying shares) is owned by
the Company or one or more Wholly Owned Subsidiaries.
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SECTION 1.02. OTHER DEFINITIONS.
DEFINED IN
TERM SECTION
---- ----------
"Affiliate Transaction" .................... 4.08
"Bankruptcy Law" ........................... 6.01
"Blockage Notice" .......................... 10.03
"covenant defeasance option" ............... 8.01(b)
"Custodian" ................................ 6.01
"Event of Default" ......................... 6.01
"Indenture Obligations" .................... 11.01
"legal defeasance option" .................. 8.01(b)
"Legal Holiday" ............................ 13.08
"Offer" .................................... 4.07(b)
"Offer Amount" ............................. 4.07(c)(2)
"Offer Period" ............................. 4.07(c)(2)
"pay its Guaranty" ......................... 12.03
"pay the Securities" ....................... 10.03
"Paying Agent" ............................. 2.03
"Payment Blockage Period" .................. 10.03
"Payment Default" .......................... 10.03
"Purchase Date" ............................ 4.07(c)(1)
"Registrar"................................. 2.03
"Successor Company" ........................ 5.01
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE
ACT. This Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC;
"indenture securities" means the Securities and each Guaranty;
"indenture security holder" means a Securityholder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the indenture securities means the Company, each
Guarantor and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another
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statute or defined by SEC rule have the meanings assigned to them by such
definitions.
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) "including" means including without limitation;
(5) words in the singular include the plural and words in the
plural include the singular;
(6) unsecured Indebtedness shall not be deemed to be
subordinate or junior to Secured Indebtedness merely by virtue of its
nature as unsecured Indebtedness;
(7) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof
that would be shown on a balance sheet of the issuer dated such date
prepared in accordance with GAAP;
(8) the principal amount of any Preferred Stock shall be (i)
the maximum liquidation value of such Preferred Stock or (ii) the
maximum mandatory redemption or mandatory repurchase price with
respect to such Preferred Stock, whichever is greater;
(9) all references to the date the Securities were originally
issued shall refer to the date the Initial Securities were originally
issued; and
(10) all references to any amount of interest or any other
amount payable on or with respect to any of the Securities shall be
deemed to include payment of any additional interest pursuant to the
Registration Rights Agreement (as defined in the Appendix).
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ARTICLE 2
THE SECURITIES
SECTION 2.01. FORM AND DATING. Provisions relating to the
Initial Securities, the Private Exchange Securities and the Exchange Securities
are set forth in the Rule 144A/Regulation S Appendix attached hereto (the
"Appendix") which is hereby incorporated in and expressly made part of this
Indenture. The Initial Securities and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit 1 to the Appendix
which is hereby incorporated in and expressly made a part of this Indenture. The
Exchange Securities, the Private Exchange Securities and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A,
which is hereby incorporated in and expressly made a part of this Indenture. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule, agreements to which the Company is subject, if any, or usage
(provided that any such notation, legend or endorsement is in a form acceptable
to the Company). Each Security shall be dated the date of its authentication.
The terms of the Securities set forth in the Appendix and Exhibit A are part of
the terms of this Indenture.
SECTION 2.02. EXECUTION AND AUTHENTICATION. Two Officers shall
sign the Securities for the Company by manual or facsimile signature. The
Company's seal shall be impressed, affixed, imprinted or reproduced on the
Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds
that office at the time the Trustee authenticates the Security, the Security
shall be valid nevertheless.
A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
On the Issue Date, the Trustee shall authenticate and deliver
$300.0 million of 103/8% Senior Subordinated Notes Due 2007 and, at any time and
from time to time thereafter, the Trustee shall authenticate and deliver
Securities for original issue upon a written order of the Company signed by two
Officers or by an Officer and either an Assistant Treasurer or an Assistant
Secretary of the Company. Such order shall specify the amount of the
Securities to be
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authenticated and the date on which the original issue of Securities is to be
authenticated and, in the case of an issuance of Additional Securities pursuant
to Section 2.13 after the Issue Date, shall certify that such issuance is in
compliance with Section 4.03.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate the Securities. Unless limited by the
terms of such appointment, an authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Registrar, Paying Agent or agent
for service of notices and demands.
SECTION 2.03. REGISTRAR AND PAYING AGENT. The Company shall
maintain an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars and one or more additional paying
agents. The term "Paying Agent" includes any additional paying agent.
The Company shall enter into an appropriate agency agreement
with any Registrar, Paying Agent or co-registrar not a party to this Indenture,
which shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall
notify the Trustee of the name and address of any such agent. If the Company
fails to maintain a Registrar or Paying Agent, the Trustee shall act as such
and shall be entitled to appropriate compensation therefor pursuant to Section
7.07. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar, co-registrar or transfer agent.
The Company initially appoints the Trustee as Registrar and
Paying Agent in connection with the Securities.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST. Prior to
each due date of the principal and interest on any Security, the Company shall
deposit with the Paying Agent a sum sufficient to pay such principal and
interest when so becoming due. The Company shall require each Paying Agent
(other than the Trustee) to agree in writing that the Paying Agent shall hold in
trust for the benefit of
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Securityholders or the Trustee all money held by the Paying Agent for the
payment of principal of or interest on the Securities and shall notify the
Trustee of any default by the Company in making any such payment, and while any
such default continues, the Trustee may require the Paying Agent to pay all
money held by it to the Trustee. If the Company or a Subsidiary acts as Paying
Agent, it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee and to account for any funds disbursed by
the Paying Agent. Upon complying with this Section, the Paying Agent shall have
no further liability for the money delivered to the Trustee.
SECTION 2.05. SECURITYHOLDER LISTS. The Trustee shall preserve
in as current a form as is reasonably practicable the most recent list
available to it of the names and addresses of Securityholders. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee, in writing at least
five 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
Securityholders.
SECTION 2.06. TRANSFER AND EXCHANGE. The Securities shall be
issued in registered form and shall be transferable only upon the surrender of a
Security for registration of transfer. When a Security is presented to the
Registrar or a co-registrar with a request to register a transfer, the Registrar
shall register the transfer as requested if the requirements of Section 8-401(1)
of the Uniform Commercial Code are met. When Securities are presented to the
Registrar or a co-registrar with a request to exchange them for an equal
principal amount of Securities of other denominations, the Registrar shall make
the exchange as requested if the same requirements are met. To permit
registration of transfers and exchanges, the Company shall execute and the
Trustee shall authenticate Securities at the Registrar's or co-registrar's
request. The Company may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with any transfer or
exchange pursuant to this Section. The Company shall not be required to make and
the Registrar need not register transfers or exchanges of Securities selected
for redemption (except, in the case of Securities to be redeemed in part, the
portion thereof not to be redeemed) or any Securities for a period of 15 days
before a selection of Securities to be redeemed or 15 days before an interest
payment date.
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Prior to the due presentation for registration of transfer of
any Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of principal of and (subject to the provisions of the Securities with
respect to record dates) interest on such Security and for all other purposes
whatsoever, whether or not such Security is overdue, and none of the Company,
the Trustee, the Paying Agent, the Registrar or any co-registrar shall be
affected by notice to the contrary.
All Securities issued upon any transfer or exchange pursuant
to the terms of this Indenture will evidence the same debt and will be entitled
to the same benefits under this Indenture as the Securities surrendered upon
such transfer or exchange.
SECTION 2.07. REPLACEMENT SECURITIES. If a mutilated Security
is surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies
any other reasonable requirements of the Trustee. If required by the Trustee or
the Company, such Holder shall furnish an indemnity bond sufficient in the
judgment of the Company and the Trustee to protect the Company, the Trustee, the
Paying Agent, the Registrar and any co-registrar from any loss which any of them
may suffer if a Security is replaced. The Company and the Trustee may charge the
Holder for their expenses in replacing a Security.
Every replacement Security is an additional obligation of the
Company.
SECTION 2.08. OUTSTANDING SECURITIES. Securities outstanding
at any time are all Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation and those described in
this Section as not outstanding. A Security does not cease to be outstanding
because the Company or an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Section 2.07, it ceases
to be outstanding unless the Trustee and the Company receive proof satisfactory
to them that the replaced Security is held by a bona fide purchaser, in which
case the replacement Security shall cease to be outstanding,
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subject to the provisions of Section 8-405 of the Uniform Commercial Code.
If the Paying Agent segregates and holds in trust, in
accordance with this Indenture, on a redemption date or maturity date money
sufficient to pay all principal and interest payable on that date with respect
to the Securities (or portions thereof) to be redeemed or maturing, as the case
may be, and the Paying Agent is not prohibited from paying such money to the
Securityholders on that date pursuant to the terms of this Indenture, then on
and after that date such Securities (or portions thereof) cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. TEMPORARY SECURITIES. Until definitive
Securities are ready for delivery, the Company may prepare and the Trustee shall
authenticate temporary Securities. Temporary Securities shall be substantially
in the form of definitive Securities but may have variations that the Company
considers appropriate for temporary Securities. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate definitive Securities
and deliver them in exchange for temporary Securities.
SECTION 2.10 CANCELLATION. The Company at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel and
destroy all Securities surrendered for registration of transfer, exchange,
payment or cancellation and deliver a certificate of such destruction to the
Company unless the Company directs the Trustee to deliver canceled Securities to
the Company. The Company may not issue new Securities to replace Securities it
has redeemed, paid or delivered to the Trustee for cancellation.
SECTION 2.11. DEFAULTED INTEREST. If the Company defaults in a
payment of interest on the Securities, the Company shall pay defaulted interest
(plus interest on such defaulted interest to the extent lawful) in any lawful
manner. The Company may pay the defaulted interest to the persons who are
Securityholders on a subsequent special record date. The Company shall fix or
cause to be fixed any such special record date and payment date to the
reasonable satisfaction of the Trustee and shall promptly mail to each
Securityholder a notice that states the special record date, the payment date
and the amount of defaulted interest to be paid.
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SECTION 2.12. CUSIP NUMBERS. The Company in issuing the
Securities may use "CUSIP" numbers (if then generally in use) and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; PROVIDED, HOWEVER, that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers.
SECTION 2.13. ISSUANCE OF ADDITIONAL SECURITIES. The Company
shall be entitled, subject to its compliance with Section 4.03, to issue
Additional Securities under this Indenture which shall have identical terms as
the Initial Securities issued on the Issue Date, other than with respect to the
date of issuance, issue price and amount of interest payable on the first
payment date applicable thereto. The Initial Securities issued on the Issue
Date, any Additional Securities and all Exchange Securities or Private Exchange
Securities issued in exchange therefor shall be treated as a single class for
all purposes under this Indenture.
With respect to any Additional Securities, the Company shall
set forth in a resolution of the Board of Directors and an Officers'
Certificate, a copy of each which shall be delivered to the Trustee, the
following information:
(1) the aggregate principal amount of such Additional
Securities to be authenticated and delivered pursuant to this
Indenture;
(2) the issue price and the issue date of such Additional
Securities and the amount of interest payable on the first payment date
applicable thereto; PROVIDED, HOWEVER, that no Additional Securities
may be issued at a price that would cause such Additional Securities to
have "original issue discount" within the meaning of Section 1273 of
the Code; and
(3) whether such Additional Securities shall be transfer
restricted securities and issued in the form of Initial Securities as
set forth in the Appendix to this Indenture or shall be issued in the
form of Exchange Securities as set forth in Exhibit A.
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ARTICLE 3
REDEMPTION
SECTION 3.01. NOTICES TO TRUSTEE. If the Company elects to
redeem the Securities pursuant to paragraph 5 of the Securities or is required
to redeem the Securities pursuant to paragraph 6 of the Securities, it shall
notify the Trustee in writing of the redemption date, the principal amount of
Securities to be redeemed and the paragraph of the Securities pursuant to which
the redemption will occur.
Except as described under the second paragraph of Section 3.03
the Company shall give each notice to the Trustee provided for in this Section
at least 45 days before the redemption date unless the Trustee consents to a
shorter period. Such notice shall be accompanied by an Officers' Certificate and
an Opinion of Counsel from the Company to the effect that such redemption will
comply with the conditions herein.
SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED. If fewer
than all the Securities are to be redeemed, the Trustee shall select the
Securities to be redeemed pro rata or by lot or by a method that complies with
applicable legal and securities exchange requirements, if any, and that the
Trustee in its sole discretion considers to be fair and appropriate. The Trustee
shall make the selection from outstanding Securities not previously called for
redemption. The Trustee may select for redemption portions of the principal of
Securities that have denominations larger than $1,000. Securities and portions
of them the Trustee selects shall be in amounts of $1,000 or a whole multiple of
$1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption. The
Trustee shall notify the Company promptly of the Securities or portions of
Securities to be redeemed.
SECTION 3.03. NOTICE OF REDEMPTION. At least 30 days but not
more than 60 days before a date for an optional redemption of Securities, the
Company shall mail a notice of redemption by first-class mail to each Holder of
Securities to be redeemed at such Holder's registered address.
The Issuer will prepare and deliver to the Trustee the notice
of the Special Redemption on or prior to the Business Day immediately preceding,
and the Trustee will send by first class mail a copy of such notice to the
Holders of the Securities on or prior to, April 26, 1999.
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The notice shall identify the Securities to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Securities are to be
redeemed, the identification and principal amounts of the particular
Securities to be redeemed;
(6) that, unless the Company defaults in making such
redemption payment or the Paying Agent is prohibited from making such
payment pursuant to the terms of this Indenture, interest on Securities
(or portion thereof) called for redemption ceases to accrue on and
after the redemption date;
(7) the paragraph of the Securities pursuant to which the
Securities called for redemption are being redeemed; and
(8) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed
on the Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. In such event,
the Company shall provide the Trustee with the information required by this
Section.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION. Once notice of
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest to the redemption date
(subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date). Failure to give
notice or any defect in the notice to any Holder shall not affect the validity
of the notice to any other Holder.
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SECTION 3.05. DEPOSIT OF REDEMPTION PRICE. Prior to the
redemption date, the Company shall deposit with the Paying Agent (or, if the
Company or a Subsidiary is the Paying Agent, shall segregate and hold in trust)
money sufficient to pay the redemption price of and accrued interest (subject
to the right of Holders of record on the relevant record date to receive
interest due on the relevant interest payment date) on all Securities to be
redeemed on that date other than Securities or portions of Securities called for
redemption which have been delivered by the Company to the Trustee for
cancellation.
SECTION 3.06. SECURITIES REDEEMED IN PART. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate for the Holder (at the Company's expense) a new Security
equal in principal amount to the unredeemed portion of the Security
surrendered.
ARTICLE 4
COVENANTS
SECTION 4.01. PAYMENT OF SECURITIES. The Company shall
promptly pay the principal of and interest on the Securities on the dates and in
the manner provided in the Securities and in this Indenture. Principal and
interest shall be considered paid on the date due if on such date the Trustee or
the Paying Agent holds in accordance with this Indenture money sufficient to pay
all principal and interest then due and the Trustee or the Paying Agent, as the
case may be, is not prohibited from paying such money to the Securityholders on
that date pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the
rate specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
SECTION 4.02. SEC REPORTS. Whether or not subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company
will file with the SEC and provide the Trustee and Securityholders with such
annual reports and such information, documents and other reports as are
specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S.
corporation subject to such Sections at the times specified for such filings
under such Sections; PROVIDED, HOWEVER that the Company will not be required to
file any reports, documents or other information
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if the SEC will not accept such a filing. The Company also shall comply with the
other provisions of TIA Section 314(a).
SECTION 4.03. LIMITATION ON INDEBTEDNESS. (a) The Company
shall not, and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness except that the Company may Incur Indebtedness if,
after giving effect thereto, the Consolidated Coverage Ratio exceeds 2.0 to 1.0.
(b) Notwithstanding the foregoing paragraph (a), the Company
and its Restricted Subsidiaries may Incur any or all of the following
Indebtedness:
(1) Indebtedness of the Company or any Restricted Subsidiary
Incurred pursuant to the Revolving Credit Facilities; PROVIDED,
HOWEVER, that, immediately after giving effect to any such Incurrence,
the aggregate principal amount of all Indebtedness incurred under this
clause (1) and then outstanding does not exceed the greater of (A)
$100.0 million and (B) the sum of 50% of the book value of the
inventory of the Company and its Restricted Subsidiaries and 65% of the
book value of the accounts receivables of the Company and its
Restricted Subsidiaries;
(2) Indebtedness of the Company Incurred pursuant to the Term
Loan Facilities; PROVIDED, HOWEVER, that, after giving effect to any
such Incurrence, the aggregate principal amount of all Indebtedness
Incurred under this clause (2) and then outstanding does not exceed
$310.0 million less the aggregate sum of all principal payments
actually made from time to time after the Issue Date with respect to
such Indebtedness (other than principal payments made from any
permitted Refinancings thereof);
(3) Indebtedness of the Company or any Restricted Subsidiary
owed to and held by the Company or a Wholly Owned Subsidiary; PROVIDED,
HOWEVER, that any subsequent issuance or transfer of any Capital Stock
which results in any such Wholly Owned Subsidiary ceasing to be a
Wholly Owned Subsidiary or any subsequent transfer of such Indebtedness
(other than to the Company or another Wholly Owned Subsidiary) shall be
deemed, in each case, to constitute the Incurrence of such Indebtedness
by the issuer thereof;
(4) Indebtedness of the Company or any Restricted Subsidiary
owed to and held by any Restricted Subsidiary (other than a Wholly
Owned Subsidiary);
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PROVIDED, HOWEVER, that (A) any such Indebtedness shall be unsecured
Subordinated Obligations of the Company or such Restricted Subsidiary,
as applicable, and (B) any subsequent issuance or transfer of any
Capital Stock of such Restricted Subsidiary or any subsequent transfer
of such Indebtedness (other than to the Company, a Wholly Owned
Subsidiary or another Restricted Subsidiary) shall be deemed to
constitute the Incurrence of such Indebtedness by the issuer thereof;
(5) the Securities (other than Additional
Securities) and the Purchase Price Note;
(6) Indebtedness outstanding on the Issue Date (other than
Indebtedness described in clause (1), (2), (3), (4) or (5) of this
Section 4.03(b));
(7) Refinancing Indebtedness in respect of Indebtedness
Incurred pursuant to Section 4.03(a) or pursuant to clause (5) or (6)
of this Section 4.03(b) or this clause (7);
(8) Hedging Obligations of the Company or any Restricted
Subsidiary under or with respect to Interest Rate Agreements and
Currency Agreements entered into in the ordinary course of business and
not for the purpose of speculation;
(9) Indebtedness of the Company or any Restricted Subsidiary
in respect of performance bonds and surety or appeal bonds entered into
by the Company and the Restricted Subsidiaries in the ordinary course
of their business;
(10) Indebtedness consisting of the Subsidiary Guaranties and
the Guarantees of Indebtedness Incurred pursuant to paragraph (a) or
pursuant to clause (1), (2), (5), (6) or (7) above or (15) below;
(11) Indebtedness of the Company or any Restricted Subsidiary
arising from the honoring by a bank or other financial institution of a
check, draft or similar instrument inadvertently (except in the case of
daylight overdrafts) drawn against insufficient funds in the ordinary
course of business, provided that such Indebtedness is satisfied within
five business days of Incurrence;
(12) Indebtedness consisting of Capital Lease Obligations in
an aggregate principal amount which, when added together with the
amount of indebtedness
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incurred pursuant to this clause (12) and then outstanding, does not
exceed $15.0 million; PROVIDED, HOWEVER, that the assets subject to the
related capital lease are not owned or used by the Company or any
Restricted Subsidiary on the Issue Date or on the Acquisition Closing
Date;
(13) Indebtedness of the Company or any Restricted Subsidiary
consisting of indemnification, adjustment of purchase price or similar
obligations, in each case incurred in connection with the disposition
of any assets of the Company or any Restricted Subsidiary in a
principal amount not to exceed the gross proceeds actually received by
the Company or any Restricted Subsidiary in connection with such
disposition;
(14) Indebtedness of a Foreign Subsidiary Incurred to finance
the purchase, lease or improvement of property (real or personal) or
equipment, in each case incurred no more than 180 days after such
purchase, lease or improvement of such property, and any Refinancing
Indebtedness in respect of such Indebtedness; PROVIDED, HOWEVER, that,
except in the case of the Incurrence of any such Refinancing
Indebtedness, at the time of the Incurrence of such Indebtedness and
after giving effect thereto, (i) the Company would be able to Incur an
additional $1.00 of Indebtedness pursuant to paragraph (a) above and
(ii) the aggregate amount of all Indebtedness Incurred pursuant to this
clause (14) and then outstanding (including any such Refinancing
Indebtedness) shall not exceed 20% of Consolidated Net Tangible Assets
as of the end of the most recent fiscal quarter ending at least 45 days
prior to the date of such Incurrence; and
(15) Indebtedness of the Company in an aggregate principal
amount which, together with all other Indebtedness of the Company and
the Restricted Subsidiaries outstanding on the date of such Incurrence
(other than Indebtedness permitted by clauses (1) through (14) of this
Section 4.03(b) or Section 4.03(a)) does not exceed $50.0 million.
(c) Notwithstanding the foregoing, the Company shall not, and
shall not permit any Restricted Subsidiary to, Incur any Indebtedness pursuant
to Section 4.03(b) if the proceeds thereof are used, directly or indirectly, to
Refinance any Subordinated Obligations unless such Indebtedness shall be
subordinated to the Securities or the
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relevant Subsidiary Guaranty, as applicable, to at least the same extent as such
Subordinated Obligations.
(d) For purposes of determining compliance with this Section
4.03, (1) in the event that an item of Indebtedness meets the criteria of more
than one of the types of Indebtedness described herein, the Company, in its sole
discretion, will classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness in one of the above clauses and
(2) an item of Indebtedness may be divided and classified in more than one of
the types of Indebtedness described herein.
(e) Notwithstanding Section 4.03(a) or 4.03(b), the Company
shall not, and shall not permit any Subsidiary Guarantor to, Incur (1) any
Indebtedness if such Indebtedness is subordinate or junior in ranking in any
respect to any Senior Indebtedness of the Company or such Subsidiary Guarantor,
as applicable, unless such Indebtedness is Senior Subordinated Indebtedness or
is expressly subordinated in right of payment to Senior Subordinated
Indebtedness or (2) any Secured Indebtedness (other than trade payables incurred
in the ordinary course of business) that is not Senior Indebtedness unless
contemporaneously therewith effective provision is made to secure the Securities
or the relevant Subsidiary Guaranty, as applicable, equally and ratably with
such Secured Indebtedness for so long as such Secured Indebtedness is secured by
a Lien.
SECTION 4.04. LIMITATION ON RESTRICTED PAYMENTS. (a) The
Company shall not, and shall not permit any Restricted Subsidiary, directly or
indirectly, to make a Restricted Payment if at the time the Company or such
Restricted Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be continuing (or
would result therefrom);
(2) the Company is not able to Incur an additional $1.00 of
Indebtedness under Section 4.03(a); or
(3) the aggregate amount of such Restricted Payment and all
other Restricted Payments since the Issue Date would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued during
the period (treated as one accounting period) from the
beginning of the fiscal quarter immediately following the
fiscal quarter during which the Securities are originally
issued
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to the end of the most recent fiscal quarter ending at least
45 days (or, if less, the number of days after the end of such
fiscal quarter as the consolidated financial statements of the
Company shall be provided to Securityholders hereunder) prior
to the date of such Restricted Payment (or, in case such
Consolidated Net Income shall be a deficit, minus 100% of such
deficit);
(B) the aggregate Net Cash Proceeds received by the
Company from the issuance or sale of its Capital Stock (other
than Disqualified Stock) subsequent to the Issue Date (other
than an issuance or sale to a Subsidiary of the Company and
other than an issuance or sale to an employee stock ownership
plan or to a trust established by the Company or any of its
Subsidiaries for the benefit of their employees to the extent
that the purchase by such plan or trust is financed by
Indebtedness of such plan or trust to the Company or any
Subsidiary or Indebtedness Guaranteed by the Company or any
Subsidiary);
(C) the amount by which Indebtedness of the Company
or any Restricted Subsidiary is reduced on the Company's
consolidated balance sheet upon the conversion or exchange
(other than by a Subsidiary of the Company) subsequent to the
Issue Date of any Indebtedness of the Company or any
Restricted Subsidiary convertible or exchangeable for Capital
Stock (other than Disqualified Stock) of the Company (less the
amount of any cash, or the fair value of any other property,
distributed by the Company or any Restricted Subsidiary upon
such conversion or exchange); and
(D) an amount equal to the sum of (i) the net
reduction in Investments in Unrestricted Subsidiaries
resulting from dividends, repayments of loans or advances or
other transfers of assets subsequent to the Issue Date, in
each case to the Company or any Restricted Subsidiary from
Unrestricted Subsidiaries, and (ii) the portion (proportionate
to the Company's equity interest in such Subsidiary) of the
fair market value of the net assets of an Unrestricted
Subsidiary at the time such Unrestricted Subsidiary is
designated a Restricted Subsidiary; PROVIDED, HOWEVER, that
the foregoing sum shall not exceed, in the case of any
Unrestricted Subsidiary, the amount of Investments previously
made (and treated as a Restricted
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Payment) by the Company or any Restricted Subsidiary in such
Unrestricted Subsidiary.
(b) The provisions of Section 4.04(a) shall not prohibit:
(1) any Restricted Payment made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Capital Stock of the
Company (other than Disqualified Stock and other than Capital Stock
issued or sold to a Subsidiary of the Company or an employee stock
ownership plan or to a trust established by the Company or any of its
Subsidiaries for the benefit of their employees to the extent that the
purchase by such plan or trust is financed by Indebtedness of such plan
or trust to the Company or any Subsidiary of the Company or
Indebtedness Guaranteed by the Company or any Subsidiary of the
Company); PROVIDED, HOWEVER, that (A) such Restricted Payment shall be
excluded in the calculation of the amount of Restricted Payments and
(B) the Net Cash Proceeds from such sale shall be excluded from the
calculation of amounts under clause (3)(B) of Section 4.04(a);
(2) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations made by
exchange for, or out of the proceeds of the substantially concurrent
sale of, Indebtedness which is permitted to be Incurred pursuant to
Section 4.03; PROVIDED, HOWEVER, that such purchase, repurchase,
redemption, defeasance or other acquisition or retirement for value
shall be excluded in the calculation of the amount of Restricted
Payments;
(3) any purchase or redemption of Disqualified Stock of the
Company or a Restricted Subsidiary made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Disqualified Stock of
the Company or a Restricted Subsidiary which is permitted to be
Incurred pursuant to Section 4.03; PROVIDED, HOWEVER, that such
purchase or redemption shall be excluded in the calculation of the
amount of Restricted Payments;
(4) any purchase or redemption of Subordinated Obligations
from Net Available Cash to the extent permitted by Section 4.06;
PROVIDED, HOWEVER, that such purchase or redemption shall be excluded
in the calculation of the amount of Restricted Payments;
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(5) upon the occurrence of a Change of Control and within 60
days after the completion of the offer to repurchase the Securities
pursuant to Section 4.09 (including the purchase of the Securities
tendered), any purchase or redemption of Subordinated Obligations
required pursuant to the terms thereof as a result of such Change of
Control at a purchase or redemption price not to exceed the outstanding
principal amount thereof, plus accrued and unpaid interest (if any);
PROVIDED, HOWEVER, that (A) at the time of such purchase or redemption
no Default shall have occurred and be continuing (or would result
therefrom), (B) the Company would be able to Incur an additional $1.00
of Indebtedness pursuant to Section 4.03(a) after giving pro forma
effect to such Restricted Payment and (C) such purchase or redemption
shall be included in the calculation of the amount of Restricted
Payments;
(6) dividends paid within 60 days after the date of
declaration thereof if at such date of declaration such dividend would
have complied with Section 4.04(a)); PROVIDED, HOWEVER, that at the
time of payment of such dividend, no other Default shall have occurred
and be continuing (or result therefrom); PROVIDED FURTHER, HOWEVER,
that such dividend shall be included in the calculation of the amount
of Restricted Payments;
(7) the repurchase or other acquisition of shares of, or
options to purchase shares of, common stock of the Company or any of
its Subsidiaries from employees, former employees, directors or former
directors of the Company or any of its Subsidiaries (or permitted
transferees of such employees, former employees, directors or former
directors), pursuant to the terms of the agreements (including
employment agreements) or plans (or amendments thereto) approved by the
Board of Directors under which such individuals purchase or sell or are
granted the option to purchase or sell, shares of such common stock;
PROVIDED, HOWEVER, that the aggregate amount of such repurchases and
other acquisitions shall not exceed the sum of $7.0 million and the Net
Cash Proceeds from the sale of Capital Stock to members of management
or directors of the Company and its Subsidiaries that occurs after the
Issue Date (to the extent the Net Cash Proceeds from the sale of such
Capital Stock have not otherwise been applied to the payment of
Restricted Payments by virtue of clause (3)(B) of Section 4.04(a);
PROVIDED FURTHER, HOWEVER, that (A) such repurchases shall be excluded
in the calculation of the amount of Restricted Payments
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and (B) the Net Cash Proceeds from such sale shall be excluded from the
calculation of amounts under clause (3)(B) of Section 4.04(a);
(8) dividends or advances to Parent in an amount necessary to
pay holding company expenses, such amount not to exceed $500,000 in any
fiscal year of the Company; PROVIDED, HOWEVER, that such dividends and
advances shall be excluded in the calculation of the amount of
Restricted Payments; or
(9) Restricted Payments not exceeding $25.0 million in the
aggregate; PROVIDED, HOWEVER, that (A) at the time of such Restricted
Payments, no Default shall have occurred and be continuing (or would
result therefrom) and (B) such Restricted Payments shall be included in
the calculation of the amount of Restricted Payments.
SECTION 4.05. LIMITATION ON RESTRICTIONS ON DISTRIBUTIONS FROM
RESTRICTED SUBSIDIARIES. The Company shall not, and shall not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to (a) pay dividends or make any other distributions on
its Capital Stock to the Company or a Restricted Subsidiary or pay any
Indebtedness owed to the Company, (b) make any loans or advances to the Company
or (c) transfer any of its property or assets to the Company, except:
(1) any encumbrance or restriction pursuant to an agreement in
effect at or entered into on the Issue Date or, in the case of the
Credit Agreement, as in effect on the Acquisition Closing Date;
(2) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement relating to any
Indebtedness Incurred by such Restricted Subsidiary on or prior to the
date on which such Restricted Subsidiary was acquired by the Company
(other than Indebtedness Incurred as consideration in, or to provide
all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant
to which such Restricted Subsidiary became a Restricted Subsidiary or
was acquired by the Company) and outstanding on such date;
(3) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness
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Incurred pursuant to an agreement referred to in clause (1) or (2) of
this Section 4.05 or this clause (3) or contained in any amendment to
an agreement referred to in clause (1) or (2) of this Section 4.05 or
this clause (3); PROVIDED, HOWEVER, that the encumbrances and
restrictions with respect to such Restricted Subsidiary contained in
any such refinancing agreement or amendment are no more restrictive in
any material respect than the encumbrances and restrictions with
respect to such Restricted Subsidiary contained in such agreements;
(4) any such encumbrance or restriction consisting of
customary nonassignment provisions in leases governing leasehold
interests to the extent such provisions restrict the transfer of the
lease or the property leased thereunder;
(5) in the case of clause (c) above, restrictions contained in
security agreements or mortgages securing Indebtedness of a Restricted
Subsidiary to the extent such restrictions restrict the transfer of the
property subject to such security agreements or mortgages;
(6) any restriction with respect to a Restricted Subsidiary
imposed pursuant to an agreement entered into for the sale or
disposition of all or substantially all the Capital Stock or assets of
such Restricted Subsidiary pending the closing of such sale or
disposition; and
(7) any restriction in any agreement that is not more
restrictive than the restrictions under the terms of the Credit
Agreement as in effect on the Acquisition Closing Date.
SECTION 4.06. LIMITATION ON SALES OF ASSETS AND
SUBSIDIARY STOCK. (a) The Company shall not, and shall not
permit any Restricted Subsidiary to, directly or indirectly,
consummate any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary receives
consideration at the time of such Asset Disposition at least equal to
the fair market value (including as to the value of all non-cash
consideration), as determined in good faith by the Board of Directors,
of the shares and assets subject to such Asset Disposition;
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(2) at least 85% of the consideration thereof received by the
Company or such Restricted Subsidiary is in the form of cash or cash
equivalents; and
(3) an amount equal to 100% of the Net Available Cash from
such Asset Disposition is applied by the Company (or such Restricted
Subsidiary, as the case may be):
(A) FIRST, to the extent the Company elects (or is required by
the terms of any Indebtedness), to prepay, repay, redeem or purchase
Senior Indebtedness or Indebtedness (other than any Disqualified Stock)
of a Wholly Owned Subsidiary (in each case other than Indebtedness owed
to the Company or an Affiliate of the Company) within one year from the
later of the date of such Asset Disposition and the receipt of such Net
Available Cash;
(B) SECOND, to the extent of the balance of such Net Available
Cash after application in accordance with clause (A), to the extent the
Company elects, to acquire Additional Assets within one year from the
later of the date of such Asset Disposition and the receipt of such Net
Available Cash;
(C) THIRD, to the extent of the balance of such Net Available
Cash after application in accordance with clauses (A) and (B), to make
an Offer to the holders of the Securities (and to holders of other
Senior Subordinated Indebtedness designated by the Company) to purchase
Securities (and such other Senior Subordinated Indebtedness) pursuant
to and subject to the conditions of Section 4.06(b); and
(D) FOURTH, to the extent of the balance of such Net Available
Cash after application in accordance with clauses (A), (B) and (C), to
(x) the acquisition by the Company or any Wholly Owned Subsidiary of
Additional Assets or (y) the prepayment, repayment or purchase of
Indebtedness (other than any Disqualified Stock) of the Company (other
than Indebtedness owed to an Affiliate of the Company) or Indebtedness
of any Subsidiary (other than Indebtedness owed to the Company or an
Affiliate of the Company),
in each case within one year from the later of the receipt of such Net Available
Cash and the date the offer described in Section 4.06(b) is consummated;
PROVIDED, HOWEVER, that in connection with any prepayment, repayment or purchase
of Indebtedness pursuant to clause (A), (C) or (D) above, the
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Company or such Restricted Subsidiary shall permanently retire such Indebtedness
and shall cause the related loan commitment (if any) to be permanently reduced
in an amount equal to the principal amount so prepaid, repaid or purchased.
Notwithstanding the foregoing provisions of this Section 4.06, the Company and
the Restricted Subsidiaries shall not be required to apply any Net Available
Cash in accordance with this Section 4.06(a) except to the extent that the
aggregate Net Available Cash from all Asset Dispositions which are not applied
in accordance with this Section 4.06(a) exceeds $10.0 million. Pending
application of Net Available Cash pursuant to this Section 4.06(a), such Net
Available Cash shall be invested in Permitted Investments or used to reduce
loans outstanding under any revolving credit facility.
For the purposes of this Section 4.06, the following are
deemed to be cash or cash equivalents: (x) the assumption of Indebtedness of the
Company or any Restricted Subsidiary and the release of the Company or such
Restricted Subsidiary from all liability on such Indebtedness in connection with
such Asset Disposition and (y) securities received by the Company or any
Restricted Subsidiary from the transferee that are promptly converted by the
Company or such Restricted Subsidiary into cash.
(b) In the event of an Asset Disposition that requires the
purchase of Securities (and other Senior Subordinated Indebtedness) pursuant to
Section 4.06(a)(3)(C), the Company shall be required to purchase Securities
tendered pursuant to an offer by the Company for the Securities (and other
Senior Subordinated Indebtedness) (the "Offer") at a purchase price of 100% of
their principal amount (without premium) plus accrued but unpaid interest (or,
in respect of such other Senior Subordinated Indebtedness, such lesser price, if
any, as may be provided for by the terms of such Senior Subordinated
Indebtedness) in accordance with the procedures (including prorating in the
event of oversubscription) set forth in Section 4.06(c). If the aggregate
purchase price of Securities (and any other Senior Subordinated Indebtedness)
tendered pursuant to the Offer is less than the Net Available Cash allotted to
the purchase thereof, the Company shall be required to apply the remaining Net
Available Cash in accordance with Section 4.06(a)(3)(D). If the aggregate
purchase price of the Securities (and any other Senior Subordinated
Indebtedness) tendered exceeds the Net Available Cash allotted to the purchase
thereof, the Company will select the Securities (and any other Senior
Subordinated Indebtedness) to be purchased on a pro rata basis but in
denominations of $1,000 or multiples thereof. The Company shall not be required
to
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make an Offer to purchase Securities (and other Senior Subordinated
Indebtedness) pursuant to this Section 4.06 if the Net Available Cash available
therefor is less than $10.0 million (which lesser amount shall be carried
forward for purposes of determining whether such an Offer is required with
respect to the Net Available Cash from any subsequent Asset Disposition).
(c) (1) Promptly, and in any event within 10 days after the
Company becomes obligated to make an Offer, the Company shall be obligated to
deliver to the Trustee and send, by first-class mail to each Holder, a written
notice stating that the Holder may elect to have his Securities purchased by the
Company either in whole or in part (subject to prorating as hereinafter
described in the event the Offer is oversubscribed) in integral multiples of
$1,000 of principal amount, at the applicable purchase price. The notice shall
specify a purchase date not less than 30 days nor more than 60 days after the
date of such notice (the "Purchase Date") and shall contain such information
concerning the business of the Company which the Company in good faith believes
will enable such Holders to make an informed decision (which at a minimum will
include (i) the most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company, the most recent
subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form
8-K of the Company filed subsequent to such Quarterly Report, other than Current
Reports describing Asset Dispositions otherwise described in the offering
materials (or corresponding successor reports or, until such time as the Company
shall become subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, a corresponding report prepared pursuant to Section 4.02), (ii) a
description of material developments in the Company's business subsequent to the
date of the latest of such Reports, and (iii) if material, appropriate pro forma
financial information) and all instructions and materials necessary to tender
Securities pursuant to the Offer, together with the information contained in
clause (3).
(2) Not later than the date upon which written notice of an
Offer is delivered to the Trustee as provided above, the Company shall deliver
to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the
"Offer Amount"), (ii) the allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and (iii) the compliance
of such allocation with the provisions of Section 4.06(a). On such date, the
Company shall also irrevocably deposit with the Trustee or with a paying agent
other than the Company in Temporary Cash
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Investments, maturing on the last day prior to the Purchase Date or on the
Purchase Date if funds are immediately available by open of business, an amount
equal to the Offer Amount to be held for payment in accordance with the
provisions of this Section. Upon the expiration of the period for which the
Offer remains open (the "Offer Period"), the Company shall deliver to the
Trustee for cancellation the Securities or portions thereof which have been
properly tendered to and are to be accepted by the Company. The Trustee shall,
on the Purchase Date, mail or deliver payment to each tendering Holder in the
amount of the purchase price. In the event that the aggregate purchase price of
the Securities delivered by the Company to the Trustee is less than the Offer
Amount, the Trustee shall deliver the excess to the Company immediately after
the expiration of the Offer Period for application in accordance with this
Section.
(3) Holders electing to have a Security purchased shall be
required to surrender the Security, with an appropriate form duly completed, to
the Company at the address specified in the notice at least three Business Days
prior to the Purchase Date. Holders shall be entitled to withdraw their election
if the Trustee or the Company receives, not later than one Business Day prior to
the Purchase Date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Security which was
delivered for purchase by the Holder and a statement that such Holder is
withdrawing his election to have such Security purchased. If at the expiration
of the Offer Period the aggregate principal amount of Securities (and any other
Senior Subordinated Indebtedness included in the Offer) surrendered pursuant to
the Offer exceeds the Offer Amount, the Company shall select the Securities and
other Senior Subordinated Indebtedness to be purchased on a pro rata basis (with
such adjustments as may be deemed appropriate by the Company so that only
Securities and other Senior Subordinated Indebtedness in denominations of
$1,000, or integral multiples thereof, shall be purchased). Holders whose
Securities are purchased only in part shall be issued new Securities equal in
principal amount to the unpurchased portion of the Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee
which are to be accepted for purchase, the Company shall also deliver an
Officers' Certificate stating that such Securities are to be accepted by the
Company pursuant to and in accordance with the terms of this Section 4.06. A
Security shall be deemed to have been accepted for purchase at the time the
Trustee, directly or through an
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agent, mails or delivers payment therefor to the surrendering Holder.
(d) The Company shall comply, to the extent applicable, with
the requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities pursuant to
this Section. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue thereof.
SECTION 4.07. LIMITATION ON AFFILIATE TRANSACTIONS. (a) The
Company shall not, and shall not permit any Restricted Subsidiary to, enter into
or permit to exist any transaction (including the purchase, sale, lease or
exchange of any property, employee compensation arrangements or the rendering of
any service) with any Affiliate of the Company (an "Affiliate Transaction")
unless the terms thereof:
(1) are no less favorable to the Company or such Restricted
Subsidiary than those that could be obtained at the time of such
transaction in arm's-length dealings with a Person who is not such an
Affiliate;
(2) if such Affiliate Transaction involves an amount in excess
of $1.0 million, (A) are set forth in writing and (B) have been
approved by a majority of the members of the Board of Directors having
no personal stake in such Affiliate Transaction; and
(3) if such Affiliate Transaction involves an amount in excess
of $10.0 million, have been determined by (A) a nationally recognized
investment banking firm to be fair, from a financial standpoint, to the
Company and its Restricted Subsidiaries or (B) an accounting or
appraisal firm nationally recognized in making such determinations to
be on terms that are not less favorable to the Company and its
Restricted Subsidiaries than the terms that could be obtained in an
arm's-length transaction from a Person that is not an Affiliate of the
Company.
(b) The provisions of Section 4.07(a) shall not prohibit:
(1) any Restricted Payment permitted to be paid
pursuant to Section 4.04;
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(2) any issuance of securities, or other payments, awards or
grants in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans
approved by the Board of Directors;
(3) the grant of stock options or similar rights to employees
and directors of the Company pursuant to plans approved by the Board of
Directors;
(4) loans or advances to employees in the ordinary course of
business in accordance with the past practices of the Company or its
Restricted Subsidiaries, but in any event not to exceed $5.0 million in
the aggregate outstanding at any one time;
(5) reasonable fees, compensation or employee benefit
arrangements to and indemnity provided for the benefit of directors,
officers or employees of the Company or any Subsidiary in the ordinary
course of business;
(6) any Affiliate Transaction between the Company
and a Wholly Owned Subsidiary or between Wholly Owned
Subsidiaries;
(7) any Affiliate Transaction with National Semiconductor
Corporation pursuant to written agreements in effect on the Issue Date
and as amended, renewed or extended from time to time; PROVIDED,
HOWEVER, that any such amendment, renewal or extension shall not
contain terms which are materially less favorable to the Company than
those in the agreements in effect on the Issue Date; and
(8) the issuance or sale of any Capital Stock (other than
Disqualified Stock) of the Company.
SECTION 4.08. LIMITATION ON THE SALE OR ISSUANCE OF CAPITAL
STOCK OF RESTRICTED SUBSIDIARIES. The Company shall not sell or otherwise
dispose of any Capital Stock of a Restricted Subsidiary, and shall not permit
any Restricted Subsidiary, directly or indirectly, to issue or sell or otherwise
dispose of any of its Capital Stock except:
(1) to the Company or a Wholly Owned Subsidiary;
(2) if, immediately after giving effect to such issuance, sale
or other disposition, neither the Company nor any of its Subsidiaries
own any Capital Stock of such Restricted Subsidiary;
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(3) if, immediately after giving effect to such issuance, sale
or other disposition, such Restricted Subsidiary would no longer
constitute a Restricted Subsidiary and any Investment in such Person
remaining after giving effect thereto would have been permitted to be
made under the covenant described in Section 4.04 if made on the date
of such issuance, sale or other disposition; or
(4) directors' qualifying shares.
SECTION 4.09. CHANGE OF CONTROL. (a) Upon the occurrence of a
Change of Control, each Holder shall have the right to require that the Company
repurchase such Holder's Securities at a purchase price in cash equal to 101% of
the principal amount thereof plus accrued and unpaid interest, if any, to the
date of purchase (subject to the right of holders of record on the relevant
record date to receive interest due on the relevant interest payment date), in
accordance with the terms contemplated in Section 4.09(b). In the event that at
the time of such Change of Control the terms of any Senior Indebtedness of the
Company restrict or prohibit any offer pursuant to this Section or the
repurchase of Securities pursuant to this Section, then prior to the mailing of
the notice to Holders provided for in Section 4.09(b) below but in any event
within 30 days following any Change of Control, the Company shall (1) repay in
full all such Senior Indebtedness or offer to repay in full all such Senior
Indebtedness and repay such Senior Indebtedness of each lender who has accepted
such offer or (2) obtain the requisite consent under the agreements governing
such Senior Indebtedness to permit the repurchase of the Securities as provided
for in Section 4.09(b). The Company must first comply with the covenant
described in the preceding sentence before it will be required to purchase
Securities in the event of a Change of Control; PROVIDED, HOWEVER, that the
Company's failure to comply with the covenant described in the preceding
sentence or to make a Change of Control offer because of any such failure shall
constitute a Default described in Section 6.01(4) (and not under Section
6.01(2)).
(b) Within 30 days following any Change of Control but subject
to the provisions of Section 4.09(a), the Company shall mail a notice to each
Holder with a copy to the Trustee stating:
(1) that a Change of Control has occurred and that such Holder
has the right to require the Company to purchase such Holder's
Securities at a purchase price in cash equal to 101% of the principal
amount thereof
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plus accrued and unpaid interest (if any) to the date of purchase
(subject to the right of Holders of record on the relevant record date
to receive interest on the relevant interest payment date);
(2) the circumstances and relevant facts regarding such Change
of Control;
(3) the repurchase date (which shall be no earlier than 30
days nor later than 60 days from the date such notice is mailed); and
(4) the instructions determined by the Company, consistent
with this Section, that a Holder must follow in order to have its
Securities purchased.
(c) Holders electing to have a Security purchased will be
required to surrender the Security, with an appropriate form duly completed, to
the Company at the address specified in the notice at least three Business Days
prior to the purchase date. Holders will be entitled to withdraw their election
if the Trustee or the Company receives not later than one Business Day prior to
the purchase date, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the Security which was
delivered for purchase by the Holder and a statement that such Holder is
withdrawing his election to have such Security purchased.
(d) On the purchase date, all Securities purchased by the
Company under this Section shall be delivered by the Trustee for cancellation,
and the Company shall pay the purchase price plus accrued and unpaid interest,
if any, to the Holders entitled thereto.
(e) The Company shall comply, to the extent applicable, with
the requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities pursuant to
this Section. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue thereof.
SECTION 4.10. FUTURE GUARANTORS. In the event that, after the
Issue Date, any Restricted Subsidiary (other than a Foreign Subsidiary) (1)
Incurs any Indebtedness pursuant to paragraph (a) or pursuant to clause (1) or
(10) of Section 4.03(b) and (2) until the termination of the
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Credit Agreement, either has Guaranteed or will as a result of such Incurrence
be required to Guarantee any Obligations under the Credit Agreement, the Company
shall cause such Restricted Subsidiary to Guarantee the Securities by executing
a supplemental indenture hereto and shall cause all Indebtedness of such
Restricted Subsidiary owing to the Company or any other Subsidiary of the
Company and not previously discharged to be converted into Capital Stock of such
Restricted Subsidiary (other than Disqualified Stock).
SECTION 4.11. COMPLIANCE CERTIFICATE. The Company shall
deliver to the Trustee within 120 days after the end of each fiscal year of the
Company a certificate of the principal executive officer, the principal
financial officer or the principal accounting officer of the Company stating
that in the course of the performance by the signer of his or her duties as an
officer of the Company such officer would normally have knowledge of any Default
and whether or not the signer knows of any Default that occurred during such
period. If such signer does, the certificate shall describe the Default, its
status and what action the Company is taking or proposes to take with respect
thereto. The Company also shall comply with TIA Section 314(a)(4).
SECTION 4.12. FURTHER INSTRUMENTS AND ACTS. Upon request of
the Trustee, the Company will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
ARTICLE 5
SUCCESSOR COMPANIES
SECTION 5.01. WHEN COMPANY MAY MERGE OR TRANSFER ASSETS. (a)
The Company shall not consolidate with or merge with or into, or convey,
transfer or lease, in one transaction or a series of transactions, all or
substantially all its assets to, any Person, unless:
(1) the resulting, surviving or transferee Person (the
"Successor Company") shall be a Person organized and existing under the
laws of the United States of America, any State thereof or the District
of Columbia and the Successor Company (if not the Company) shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and this Indenture;
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(2) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor
Company or any Subsidiary as a result of such transaction as having
been Incurred by the Successor Company or such Subsidiary at the time
of such transaction), no Default shall have occurred and be continuing;
(3) immediately after giving effect to such transaction, the
Successor Company would be able to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a);
(4) immediately after giving effect to such transaction, the
Successor Company shall have Consolidated Net Worth in an amount that
is not less than the Consolidated Net Worth of the Company immediately
prior to such transaction; and
(5) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if
any) comply with this Indenture;
PROVIDED, HOWEVER, that clauses (3) and (4) above shall not apply if, in the
good faith determination of the Board of Directors, whose determination shall be
evidenced by a resolution of the Board of Directors, the principal purpose and
effect of such transaction is to change the jurisdiction of incorporation of the
Company.
The Successor Company shall be the successor to the Company
and shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture, but the predecessor Company in the
case of a conveyance, transfer or lease shall not be released from the
obligation to pay the principal of and interest on the Securities.
(b) The Company shall not permit any Subsidiary Guarantor to
consolidate with or merge with or into, or convey, transfer or lease, in one
transaction or series of transactions, all or substantially all of its assets to
any Person unless:
(1) the resulting, surviving or transferee Person (if not such
Subsidiary) shall be a Person organized and existing under the laws of
the jurisdiction under which such Subsidiary was organized or under the
laws of the United States of America, or any State thereof
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or the District of Columbia, and such Person shall expressly assume, by
executing a Guaranty Agreement, in a form acceptable to the Trustee,
all the obligations of such Subsidiary, if any, under its Subsidiary
Guaranty;
(2) immediately after giving effect to such transaction or
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person
as a result of such transaction as having been issued by such Person at
the time of such transaction), no Default shall have occurred and be
continuing; and
(3) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such Guaranty Agreement, if any,
complies with this Indenture. The provisions of clauses (i) and (ii)
above shall not apply to any one or more transactions which constitute
an Asset Disposition if the Company has complied with the applicable
provisions of Section 4.06.
The Person who shall be the successor to a Subsidiary
Guarantor shall succeed to, and be substituted for, and may exercise every right
and power of, the predecessor Subsidiary Guarantor under this Indenture, but the
predecessor Subsidiary Guarantor in the case of a conveyance, transfer or lease
shall not be released from its obligations under its Subsidiary Guaranty.
(c) Parent will not merge with or into, or convey, transfer or
lease, in one transaction or a series of transactions, all or substantially all
of its assets to any Person unless:
(1) the resulting, surviving or transferee Person (if not
Parent) shall be a Person organized and existing under the laws of the
jurisdiction under which Parent was organized or under the laws of the
United States of America, or any State thereof or the District of
Columbia, and such Person shall expressly assume, by executing a
Guaranty Agreement, in a form acceptable to the Trustee, all the
obligations of Parent, if any, under the Parent Guaranty;
(2) immediately after giving effect to such transaction or
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person
as a
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result of such transaction as having been issued by such Person at the
time of such transaction), no Default shall have occurred and be
continuing; and
(3) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such Guaranty Agreement, if any,
complies with this Indenture. The provisions of clauses (i) and (ii)
above shall not apply to any one or more transactions which constitute
an Asset Disposition if the Company has complied with the applicable
provisions of Section 4.06.
The Person who shall be the successor to a Subsidiary
Guarantor shall succeed to, and be substituted for, and may exercise every
right and power of, the predecessor Subsidiary Guarantor under this Indenture,
but the predecessor Subsidiary Guarantor in the case of a conveyance, transfer
or lease shall not be released from its obligations under its Subsidiary
Guaranty.
(c) Parent will not merge with or into, or convey, transfer
or lease, in one transaction or a series of transactions, all or substantially
all of its assets to any Person unless:
(1) the resulting, surviving or transferee Person (if not
Parent) shall be a Person organized and existing under the laws of the
jurisdiction under which Parent was organized or under the laws of the
United States of America, or any State thereof or the District of
Columbia, and such Person shall expressly assume, by executing a
Guaranty Agreement, in a form acceptable to the Trustee, all the
obligations of Parent, if any, under the Parent Guaranty;
(2) immediately after giving effect to such transaction or
transactions on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person
as a result of such transaction as having been issued by such Person at
the time of such transaction), no Default shall have occurred and be
continuing; and
(3) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such Guaranty Agreement, if any,
complies with this Indenture.
The Person who shall be the successor to the Parent shall
succeed to, and be substituted for, and may exercise every right and power of,
the Parent under this Indenture, but the Parent in the case of a conveyance,
transfer or lease shall not be released from its obligations under the Parent
Guaranty.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT. An "Event of
Default" occurs if:
(1) the Company defaults in any payment of interest on any
Security when the same becomes due and payable, whether or not such
payment shall be prohibited by Article 10, and such default continues
for a period of 30 days;
(2) the Company (i) defaults in the payment of the principal
of any Security when the same becomes due and payable at its Stated
Maturity, upon redemption, upon declaration or otherwise, whether or
not such payment shall be prohibited by Article 10, or (ii) fails to
redeem or purchase Securities when required pursuant to this Indenture
or the Securities, whether or not such redemption or purchase shall be
prohibited by Article 10;
(3) the Company or Parent fails to comply with Section 5.01;
(4) the Company fails to comply with Section 4.02, 4.03, 4.04,
4.05, 4.06, 4.07, 4.08, 4.09 or 4.10 (other than a failure to purchase
Securities when required under Section 4.06 or 4.09) and such failure
continues for 30 days after the notice specified below;
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(5) the Company fails to comply with any of its agreements in
the Securities or this Indenture (other than those referred to in
clause (1), (2), (3) or (4) above) and such failure continues for 60
days after the notice specified below;
(6) Indebtedness of the Company or any Significant Subsidiary
is not paid within any applicable grace period after final maturity or
is accelerated by the holders thereof because of a default and the
total amount of such Indebtedness unpaid or accelerated exceeds $10.0
million, or its foreign currency equivalent at the time;
(7) the Company or any Significant Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a Custodian of it
or for any substantial part of its property; or
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws
relating to insolvency;
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any
Significant Subsidiary or for any substantial part of its
property; or
(C) orders the winding up or liquidation of the
Company or any Significant Subsidiary;
or any similar relief is granted under any foreign laws
and the order or decree remains unstayed and in effect
for 60 days;
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(9) any judgment or decree for the payment of money in excess
of $10.0 million or its foreign currency equivalent at the time is
entered against the Company or any Significant Subsidiary, remains
outstanding for a period of 60 days following the entry of such
judgment or decree and is not discharged, waived or the execution
thereof stayed within 10 days after the notice specified below; or
(10) the Parent Guaranty or any Subsidiary Guaranty ceases to
be in full force and effect (other than in accordance with the terms of
such Guaranty) or Parent or any Subsidiary Guarantor denies or
disaffirms its obligations under the Parent Guaranty or any Subsidiary
Guaranty, as applicable.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
The term "Bankruptcy Law" means Xxxxx 00, XXXXXX XXXXXX CODE,
or any similar Federal or state law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (4), (5), or (9) is not an Event of
Default until the Trustee or the holders of at least 25% in principal amount of
the outstanding Securities notify the Company of the Default and the Company
does not cure such Default within the time specified after receipt of such
notice. Such notice must specify the Default, demand that it be remedied and
state that such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of any Event of Default under clause (6) or (10) and any event which with the
giving of notice or the lapse of time would become an Event of Default under
clause (4), (5) or (9), its status and what action the Company is taking or
proposes to take with respect thereto.
SECTION 6.02. ACCELERATION. If an Event of Default (other than
an Event of Default specified in Section 6.01(7) or (8) with respect to the
Company) occurs and is continuing, the Trustee by notice to the Company, or
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the Holders of at least 25% in principal amount of the Securities by notice to
the Company and the Trustee, may declare the principal of and accrued but unpaid
interest on all the Securities to be due and payable. Upon such a declaration,
such principal and interest shall be due and payable immediately; PROVIDED,
HOWEVER, that if upon such declaration there are any amounts outstanding under
the Credit Agreement and the amounts thereunder have not been accelerated, such
principal and interest shall be due and payable upon the earlier of the time
such amounts are accelerated and five Business Days after receipt by the Company
and the Representative under the Credit Agreement of such declaration. If an
Event of Default specified in Section 6.01(7) or (8) with respect to the Company
occurs, the principal of and interest on all the Securities shall IPSO FACTO
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Securityholders. The Holders of a majority in
principal amount of the outstanding Securities by notice to the Trustee may
rescind an acceleration with respect to the Securities and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of acceleration. No
such rescission shall affect any subsequent Default or impair any right
consequent thereto.
SECTION 6.03. OTHER REMEDIES. If an Event of Default occurs
and is continuing, the Trustee may pursue any available remedy to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy accruing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04. WAIVER OF PAST DEFAULTS. The Holders of a
majority in principal amount of the Securities by notice to the Trustee may
waive an existing Default and its consequences except (1) a Default in the
payment of the principal of or interest on a Security or (2) a Default in
respect of a provision that under Section 9.02 cannot be amended without the
consent of each Securityholder affected. When a Default is waived, it is deemed
cured, but no such
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waiver shall extend to any subsequent or other Default or impair any consequent
right.
SECTION 6.05. CONTROL BY MAJORITY. The Holders of a majority
in principal amount of the Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Securityholders or would involve the Trustee in personal
liability; PROVIDED, HOWEVER, that the Trustee may take any other action deemed
proper by the Trustee that is not inconsistent with such direction. Prior to
taking any action hereunder, the Trustee shall be entitled to indemnification
satisfactory to it in its sole discretion against all losses and expenses caused
by taking or not taking such action.
SECTION 6.06. LIMITATION ON SUITS. Except to enforce the right
to receive payment of principal, premium (if any) or interest when due, no
Securityholder may pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Trustee written notice stating
that an Event of Default is continuing;
(2) the Holders of at least 25% in principal amount of the
Securities make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer of security or
indemnity; and
(5) the Holders of a majority in principal amount of the
Securities do not give the Trustee a direction inconsistent with the
request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
another Securityholder.
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' SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of principal of and interest on the Securities held by such
Holder, on or after the respective due dates expressed in the Securities, 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(1) or (2) occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company for the whole amount then due and owing (together with
interest on any unpaid interest to the extent lawful) and the amounts provided
for in Section 7.07.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee
may file such proofs of claim and other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company, its creditors or
its property and, unless prohibited by law or applicable regulations, may vote
on behalf of the Holders in any election of a trustee in bankruptcy or other
Person performing similar functions. The Trustee 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 it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and its counsel, and any other amounts due the Trustee under
Section 7.07.
SECTION 6.10. PRIORITIES. If the Trustee collects any
money or property pursuant to this Article 6, it shall pay out the money or
property in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to holders of Senior Indebtedness of the
Company to the extent required by Article 10;
THIRD: to Securityholders for amounts due and
unpaid on the Securities for principal and interest,
ratably, without preference or priority of any kind,
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according to the amounts due and payable on the Securities for
principal and interest, respectively; and
FOURTH: to the Company.
The Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section. At least 15 days before
such record date, the Company shall mail to each Securityholder and the Trustee
a notice that states the record date, the payment date and amount to be paid.
SECTION 6.11. UNDERTAKING FOR COSTS. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, 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 pursuant to Section 6.07 or a suit by
Holders of more than 10% in principal amount of the Securities.
SECTION 6.12. WAIVER OF STAY OR EXTENSION LAWS. The Company
(to the extent it may lawfully do so) shall not at any time insist upon, or
plead, or in any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, which may affect the covenants or the performance of this Indenture; and
the Company (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and shall not hinder, delay or impede
the execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
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 their exercise, as a prudent Person would exercise or use under the
circumstances in the conduct of such Person's own affairs.
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(b) Except during the continuance of an Event of
Default:
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, in the case of any such certificates or
opinions which, by any provision hereof, are required to be furnished
to the Trustee, the Trustee shall examine such certificates and
opinions to determine whether or not they conform to the requirements
of this Indenture.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act or its own wilful misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates
to the Trustee, other than paragraph (g) of this Section, is subject to
paragraphs (a), (b) and (c) of this Section.
(e) 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.
(f) Money held in trust by the Trustee need not be segregated
from other funds except to the extent required by law.
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(g) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
SECTION 7.02. RIGHTS OF TRUSTEE. (a) The Trustee may
conclusively rely on any document believed by it to be genuine and to have been
signed or presented by the proper Person. The Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) Subject to Section 7.01(c), the Trustee shall not be
liable for any action it takes or omits to take in good faith which it believes
to be authorized or within its rights or powers.
(e) The Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture and
the Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it here under
in good faith and in accordance with the advice or opinion of such counsel.
SECTION 7.03. INDIVIDUAL RIGHTS OF TRUSTEE. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 7.10 and 7.11.
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SECTION 7.04. TRUSTEE'S DISCLAIMER. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement of the Company in the Indenture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication.
SECTION 7.05. NOTICE OF DEFAULTS. If a Default occurs and is
continuing and if it is actually known to the Trustee, or upon written notice
from the Company or any Securityholder or upon a Payment Default, the Trustee
shall mail to each Securityholder notice of the Default within 90 days after it
occurs. Except in the case of a Default in payment of principal of or interest
on any Security (including payments pursuant to the mandatory redemption
provisions of such Security, if any), the Trustee may withhold the notice if and
so long as a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Securityholders.
SECTION 7.06. REPORTS BY TRUSTEE TO HOLDERS. By July 15 of
each year, beginning with the July 15 following the date of this Indenture, the
Trustee shall mail to each Securityholder a brief report dated as of May 15 of
each year that complies with TIA Section 313(a). The Trustee also shall comply
with TIA Section 313(b).
A copy of each report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange (if any) on
which the Securities are listed. The Company agrees to notify promptly the
Trustee whenever the Securities become listed on any stock exchange and of any
delisting thereof.
SECTION 7.07. COMPENSATION AND INDEMNITY. The Company shall
pay to the Trustee from time to time reasonable compensation for its services.
The Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable out-of-pocket expenses, disbursements and
advances incurred or made by it, including costs of collection, in addition to
the compensation for its services. Such expenses shall include the reasonable
compensation and expenses, disbursements and advances of the Trustee's agents,
counsel, accountants and experts. The Company shall indemnify the Trustee
against any and all loss, liability or expense (including attorneys' reasonable
fees) incurred by it in
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connection with the administration of this trust and the performance of its
duties hereunder, including the costs and expenses of enforcing this Indenture
(including this Section 7.07) against the Company and defending itself against
any claim (whether asserted by any Securityholder 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 that any such loss, liability or expense
is 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 unless such failure prejudices the Company. The Company
shall defend the claim and the Trustee may have separate counsel and the Company
shall pay the fees and expenses of such counsel. The Company need not reimburse
any expense or indemnify against any loss, liability or expense incurred by the
Trustee through the Trustee's own wilful misconduct, negligence or bad faith.
The Company need not pay for any settlement made by the Trustee without the
Company's consent, such consent not to be unreasonably withheld.
To secure the Company's payment obligations in this Section,
the Trustee shall have a lien prior to the Securities on all money or property
held or collected by the Trustee other than money or property held in trust to
pay principal of and interest on particular Securities.
The Company's payment obligations, and the lien granted to the
Trustee, pursuant to this Section shall survive the discharge of this Indenture.
When the Trustee incurs expenses or renders services after the occurrence of a
Default specified in Section 6.01(7) or (8) with respect to the Company, 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 the Bankruptcy Law.
SECTION 7.08. REPLACEMENT OF TRUSTEE. The Trustee may resign
at any time by so notifying the Company. The Holders of a majority in principal
amount of the Securities may remove the Trustee by so notifying the Trustee and
may appoint a successor Trustee. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
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(3) a receiver or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the
Holders of a majority in principal amount of the Securities and such Holders do
not reasonably promptly appoint a successor Trustee, or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Company shall promptly appoint a
successor Trustee.
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 Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, provided that the
amounts owing to the Trustee hereunder have been paid and subject to the lien
provided for in Section 7.07.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee or the
Holders of 10% in principal amount of the Securities may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to
this Section, the Company's obligations under Section 7.07 shall continue for
the benefit of the retiring Trustee.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee PROVIDED that such successor shall be
eligible and qualified under Section 7.10.
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In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION. The Trustee shall
at all times satisfy the requirements of TIA Section 310(a). The Trustee shall
have a combined capital and surplus of at least $50,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities or certificates of interest or participation in other securities of
the Company are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST
COMPANY. The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. DISCHARGE OF LIABILITY ON SECURITIES;
DEFEASANCE. (a) When (1) the Company delivers to the Trustee all outstanding
Securities (other than Securities replaced pursuant to Section 2.07) for
cancellation or (2) all outstanding Securities have become due and payable,
whether at maturity or as a result of the mailing of a notice of redemption
pursuant to Article 3 hereof and the Company irrevocably deposits with the
Trustee funds sufficient to pay at maturity or upon redemption all outstanding
Securities, including interest thereon to maturity or such redemption date
(other than Securities replaced pursuant to Section 2.07), and if in either case
the Company pays all
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other sums payable hereunder by the Company, then this Indenture shall, subject
to Sections 8.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Company accompanied by an Officers' Certificate and an Opinion of Counsel and at
the cost and expense of the Company.
(b) Subject to Sections 8.01(c) and 8.02, the Company at any
time may terminate (1) all its obligations under the Securities and this
Indenture ("legal defeasance option") or (2) its obligations under Sections 4.02
(subject to any requirements of the TIA), 4.03, 4.04, 4.05, 4.06, 4.07, 4.08,
4.09 and 4.10 and the operation of Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8)
and 6.01(9) (but, in the case of Sections 6.01(7) and (8), with respect only to
Significant Subsidiaries) and the limitations contained in Sections 5.01(a)(3)
and (4) ("covenant defeasance option"). The Company may exercise its legal
defeasance option notwithstanding its prior exercise of its covenant defeasance
option.
If the Company exercises its legal defeasance option, payment
of the Securities may not be accelerated because of an Event of Default with
respect thereto. If the Company exercises its covenant defeasance option,
payment of the Securities may not be accelerated because of an Event of Default
specified in Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in
the case of Sections 6.01(7) and (8), with respect only to Significant
Subsidiaries) or because of the failure of the Company to comply with Section
5.01(a)(3) or (4) or because of the failure of Parent to comply with Section
5.01. If the Company exercises its legal defeasance option or its covenant
defeasance option, Parent shall be released from all its obligations with
respect to the Parent Guaranty and each Subsidiary Guarantor, if any, shall be
released from all its obligations with respect to its Subsidiary Guaranty.
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Trustee shall acknowledge in writing the discharge
of those obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.07, 7.08, 8.04,
8.05 and 8.06 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05 shall
survive.
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SECTION 8.02. CONDITIONS TO DEFEASANCE. The Company may
exercise its legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee
money or U.S. Government Obligations for the payment of principal of
and interest on the Securities to maturity or redemption, as the case
may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus
any deposited money without investment will provide cash at such times
and in such amounts as will be sufficient to pay principal and interest
when due on all the Securities to maturity or redemption, as the case
may be;
(3) 123 days pass after the deposit is made and during the
123-day period no Default specified in Sections 6.01(7) or (8) with
respect to the Company occurs which is continuing at the end of the
period;
(4) the deposit does not constitute a default under any other
agreement binding on the Company and is not prohibited by Article 10;
(5) the Company delivers to the Trustee an Opinion of Counsel
to the effect that the trust resulting from the deposit does not
constitute, or is qualified as, a regulated investment company under
the Investment Company Act of 1940;
(6) in the case of the legal defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that
(i) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling, or (ii) 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 Securityholders will not recognize
income, gain or loss for Federal income tax purposes as a result of
such defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been
the case if such defeasance had not occurred;
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(7) in the case of the covenant defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Security holders will not recognize income, gain or loss for
Federal income tax purposes as a result of such covenant defeasance and
will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
covenant defeasance had not occurred; and
(8) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent to the defeasance and discharge of the Securities as
contemplated by this Article 8 have been complied with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date in
accordance with Article 3.
SECTION 8.03. APPLICATION OF TRUST MONEY. The Trustee shall
hold in trust money or U.S. Government Obligations deposited with it pursuant to
this Article 8. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal of and interest on the Securities. Money
and securities so held in trust are not subject to Article 10.
SECTION 8.04. REPAYMENT TO COMPANY. The Trustee and the Paying
Agent shall promptly turn over to the Company upon request any excess money or
securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee
and the Paying Agent shall pay to the Company upon request any money held by
them for the payment of principal or interest that remains unclaimed for two
years, and, thereafter, Securityholders entitled to the money must look to the
Company for payment as general creditors.
SECTION 8.05. INDEMNITY FOR GOVERNMENT OBLIGATIONS. The
Company shall pay and shall indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against deposited U.S. Government Obligations or
the principal and interest received on such U.S. Government Obligations.
SECTION 8.06. REINSTATEMENT. If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with this
Article 8 by reason of
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any legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article 8 until such time as the Trustee or Paying Agent is permitted to
apply all such money or U.S. Government Obligations in accordance with this
Article 8; PROVIDED, HOWEVER, that, if the Company has made any payment of
interest on or principal of any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. WITHOUT CONSENT OF HOLDERS. The Company and the
Trustee may amend this Indenture or the Securities without notice to or consent
of any Securityholder:
(1) to cure any ambiguity, omission, defect or
inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or
in place of certificated Securities; PROVIDED, HOWEVER, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to make any change in Article 10 or 12 that would limit or
terminate the benefits available to any holder of Senior Indebtedness
(or Representatives therefor) under Article 10 or Article 12;
(5) to add guarantees with respect to the Securities,
including any Subsidiary Guaranties, or to secure the Securities;
(6) to add to the covenants of the Company for the benefit of
the Holders or to surrender any right or power herein conferred upon
the Company;
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(7) to comply with any requirements of the SEC in connection
with qualifying, or maintaining the qualification of, this Indenture
under the TIA;
(8) to make any change that does not adversely affect the
rights of any Securityholder; or
(9) to release a Subsidiary Guaranty when permitted by the
terms of this Indenture.
An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or 12 of any holder of Senior
Indebtedness then outstanding unless the holders of such Senior Indebtedness (or
any group or representative thereof authorized to give a consent) consent to
such change.
After an amendment under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section.
SECTION 9.02. WITH CONSENT OF HOLDERS. The Company and the
Trustee may amend this Indenture or the Securities without notice to any
Securityholder but with the written consent of the Holders of at least a
majority in principal amount of the Securities then outstanding (including
consents obtained in connection with a tender offer or exchange for the
Securities). However, without the consent of each Securityholder affected
thereby, an amendment may not:
(1) reduce the amount of Securities whose Holders
must consent to an amendment;
(2) reduce the rate of or extend the time for payment of
interest on any Security;
(3) reduce the principal of or extend the Stated Maturity of
any Security;
(4) reduce the premium payable upon the redemption of any
Security or change the time at which any Security may or shall be
redeemed in accordance with Article 3;
(5) make any Security payable in money other than that stated
in the Security;
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(6) impair the right of any holder of the Securities to
receive payment of principal of and interest on such holder's
Securities on or after the due dates therefor or to institute suit for
the enforcement of any payment on or with respect to such holder's
Securities;
(7) make any change in Article 10 that adversely affects the
rights of any Securityholder under Article 10;
(8) make any change in Section 6.04 or 6.07 or the second
sentence of this Section;
(9) make any change in the Parent Guaranty or any Subsidiary
Guaranty (including the subordination provisions of any such Guaranty)
that would adversely affect the Securityholders; or
(10) make any change in the provisions described under
paragraph 6 of the Securities.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or 12 of any holder of Senior
Indebtedness then outstanding unless the holders of such Senior Indebtedness (or
any group or representative thereof authorized to give a consent) consent to
such change.
After an amendment under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing such
amendment. The failure to give such notice to all Securityholders, or any defect
therein, shall not impair or affect the validity of an amendment under this
Section.
SECTION 9.03. COMPLIANCE WITH TRUST INDENTURE ACT. Every
amendment to this Indenture or the Securities shall comply with the TIA as then
in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS AND WAIVERS. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not
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made on the Security. However, any such Holder or subsequent Holder may revoke
the consent or waiver as to such Holder's Security or portion of the Security if
the Trustee receives the notice of revocation before the date the amendment or
waiver becomes effective. After an amendment or waiver becomes effective, it
shall bind every Security holder. An amendment or waiver becomes effective upon
the execution of such amendment or waiver by the Trustee.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to revoke any consent
previously given or to take any such action, whether or not such Persons
continue to be Holders after such record date. No such consent shall be valid or
effective for more than 120 days after such record date.
SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES. If an
amendment changes the terms of a Security, the Trustee may require the Holder of
the Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.06. TRUSTEE TO SIGN AMENDMENTS. The Trustee shall
sign any amendment authorized pursuant to this Article 9 if the amendment does
not adversely affect the rights, duties, liabilities or immunities of the
Trustee. If it does, the Trustee may but need not sign it. In signing any
amendment the Trustee shall be entitled to receive indemnity reasonably
satisfactory to it and to receive, and (subject to Section 7.01) shall be fully
protected in relying upon, an Officers' Certificate and an Opinion of Counsel
stating that such amendment is authorized or permitted by this Indenture.
SECTION 9.07. PAYMENT FOR CONSENT. Neither the Company nor any
Affiliate of the Company shall, directly or indirectly, pay or cause to be paid
any consideration, whether by way of interest, fee or otherwise, to any Holder
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for or as an inducement to any consent, waiver or amendment of any of the terms
or provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all Holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE 10
SUBORDINATION
SECTION 10.01. AGREEMENT TO SUBORDINATE. The Company agrees,
and each Securityholder by accepting a Security agrees, that the Indebtedness
evidenced by the Securities is subordinated in right of payment, to the extent
and in the manner provided in this Article 10, to the prior payment in full in
cash of all Obligations with respect to Senior Indebtedness of the Company and
that the subordination is for the benefit of and enforceable by the holders of
such Senior Indebtedness. The Securities shall in all respects rank PARI PASSU
with all other Senior Subordinated Indebtedness of the Company and only
Indebtedness of the Company which is Senior Indebtedness shall rank senior to
the Securities in accordance with the provisions set forth herein. All
provisions of this Article 10 shall be subject to Section 10.12.
SECTION 10.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY. Upon any
payment or distribution of the assets of the Company to creditors upon a total
or partial liquidation or a total or partial dissolution or winding up of the
Company or upon any assignment for the benefit of creditors or marshalling of
assets of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property,
whether voluntary or involuntary:
(1) the holders of Senior Indebtedness of the Company shall be
entitled to receive payment in full in cash of all Obligations with
respect to such Senior Indebtedness (including all interest accruing
subsequent to the filing of a petition in bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) before
Securityholders shall be entitled to receive any payment or
distribution with respect to the Securities; and
(2) until all Obligations with respect to such Senior
Indebtedness are paid in full in cash, any
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payment or distribution to which Securityholders would be entitled but
for this Article 10 shall be made to holders of such Senior
Indebtedness as their interests may appear, except that Securityholders
may receive, in exchange for the Securities in any proceeding of the
type described above in this Section 10.02, (x) equity securities of
the Company which, in any case, do not provide for any mandatory
redemption or similar retirement prior to the maturity of the
Securities or (y) unsecured debt securities of the Company which are
subordinated to at least the same extent as the Securities to the
payment of all Senior Indebtedness of the Company and which, in any
case, do not mature or become subject to a mandatory redemption
obligation prior to the maturity of the Securities.
SECTION 10.03. DEFAULT ON SENIOR INDEBTEDNESS. The Company may
not pay (in cash, property or other assets) the principal of, premium, if any,
or interest on the Securities or make any deposit pursuant to Section 8.01 and
may not repurchase, redeem or (except for Securities delivered to the Trustee
pursuant to the second sentence of paragraph 6 of the Securities) otherwise
retire any Securities (collectively, "pay the Securities") if either of the
following occurs (each a "Payment Default"): (1) any Obligations with respect to
Senior Indebtedness are not paid in full when due or (2) any other default on
Senior Indebtedness occurs and the maturity of such Senior Indebtedness is
accelerated in accordance with its terms unless, in either case, (x) the default
has been cured or waived and any such acceleration has been rescinded in writing
or (y) such Senior Indebtedness has been paid in full in cash; PROVIDED,
HOWEVER, that the Company may pay the Securities without regard to the foregoing
if the Company and the Trustee receive written notice approving such payment
from the Representative of such Senior Indebtedness. During the continuance of
any default (other than a default described in clause (1) or (2) of the
preceding sentence) with respect to any Designated Senior Indebtedness pursuant
to which the maturity thereof may be accelerated immediately without further
notice (except such notice as may be required to effect such acceleration) or
the expiration of any applicable grace periods, the Company may not pay the
Securities for a period (a "Payment Blockage Period") commencing upon the
receipt by the Company and the Trustee of written notice (a "Blockage Notice")
of such default from the Representative of such Designated Senior Indebtedness
specifying an election to effect a Payment Blockage Period and ending 179 days
thereafter or earlier if such Payment Blockage Period is terminated:
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(1) by written notice to the Trustee and the Company from the
Person or Persons who gave such Blockage Notice;
(2) because no defaults continue in existence which would
permit the acceleration of the maturities of any Designated Senior
Indebtedness at such time; or
(3) because such Designated Senior Indebtedness has been
repaid in full in cash.
Notwithstanding the provisions described above, unless the holders of such
Designated Senior Indebtedness or the Representative of such holders shall have
accelerated the maturity of such Designated Senior Indebtedness, or any Payment
Default otherwise exists, the Company may resume payments on the Securities
after termination of such Payment Blockage Period. The Securities shall not be
subject to more than one Payment Blockage Period in any consecutive 360-day
period, except that if any Blockage Notice is delivered to the Trustee by or on
behalf of holders of Designated Senior Indebtedness (other than holders of the
Bank Indebtedness), a Representative of holders of Bank Indebtedness may give
another Blockage Notice within such period. However, in no event may the total
number of days during which any Payment Blockage Period or Periods is in effect
exceed 179 days in the aggregate during any 360 consecutive day period, and
there must be 181 days during any 360-day consecutive period during which no
Payment Blockage Period is in effect.
For purposes of this Section, no default or event of default
which existed or was continuing on the date of the commencement of any Payment
Blockage Period with respect to the Designated Senior Indebtedness initiating
such Payment Blockage Period shall be, or be made, the basis of the commencement
of a subsequent Payment Blockage Period by the Representative of such Designated
Senior Indebtedness, whether or not within a period of 360 consecutive days,
unless such default or event of default shall have been cured or waived for a
period of not less than 90 consecutive days (it being acknowledged and agreed
that (x) any default or event of default as a result of a continued failure to
meet a financial covenant or test for a period ended subsequent to the
commencement of a Payment Blockage Period shall constitute a new default or
event of default, as the case may be, and shall be deemed not to be a continuing
default or event of default, as the case may be, for purposes of this sentence
and (y) any subsequent action which would give rise to a default or an event of
default pursuant to any provision under which a default or event of
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default previously existed or was continuing shall constitute a new default or
event of default, as the case may be, for this purpose and shall be deemed not
to be a continuing default or event of default, as the case may be, for purposes
of this sentence).
SECTION 10.04. ACCELERATION OF PAYMENT OF SECURITIES. If
payment of the Securities is accelerated because of an Event of Default, the
Company or the Trustee shall promptly notify the holders of the Designated
Senior Indebtedness (or their Representatives) of the acceleration. If any
Designated Senior Indebtedness is outstanding at the time of such acceleration,
neither the Company nor any Subsidiary Guarantor may pay the Securities until
five Business Days after the Representatives of all the issues of Designated
Senior Indebtedness receive notice of such acceleration and, thereafter, may pay
the Securities only if the Indenture otherwise permits payment at that time.
SECTION 10.05. WHEN DISTRIBUTION MUST BE PAID OVER. If a
distribution is made to Securityholders that because of this Article 10 should
not have been made to them, the Securityholders who receive the distribution
shall hold it in trust for holders of Senior Indebtedness of the Company and pay
it over to them as their interests may appear.
SECTION 10.06. SUBROGATION. After all Senior Indebtedness of
the Company is paid in full in cash and until the Securities are paid in full,
Securityholders shall be subrogated to the rights of holders of such Senior
Indebtedness to receive distributions applicable to such Senior Indebtedness. A
distribution made under this Article 10 to holders of such Senior Indebtedness
which otherwise would have been made to Securityholders is not, as between the
Company and Securityholders, a payment by the Company on such Senior
Indebtedness.
SECTION 10.07. RELATIVE RIGHTS. This Article 10 defines the
relative rights of Securityholders and holders of Senior Indebtedness of the
Company. Nothing in this Indenture shall:
(1) impair, as between the Company and Securityholders, the
obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Securities in accordance with their
terms; or
(2) prevent the Trustee or any Securityholder from exercising
its available remedies upon a Default, sub-
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ject to the rights of holders of Senior Indebtedness of the Company to
receive distributions otherwise payable to Securityholders.
SECTION 10.08. SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY.
No right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Securities shall be impaired
by any act or failure to act by the Company or by its failure to comply with
this Indenture.
SECTION 10.09. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding Section 10.03, the Trustee or Paying Agent may continue to make
payments on the Securities and shall not be charged with knowledge of the
existence of facts that would prohibit the making of any such payments unless,
not less than two Business Days prior to the date of such payment, a Trust
Officer of the Trustee receives notice satisfactory to it that payments may not
be made under this Article 10. The Company, the Registrar or co-registrar, the
Paying Agent, a Representative or a holder of Senior Indebtedness may give the
notice.
The Trustee in its individual or any other capacity may hold
Senior Indebtedness of the Company with the same rights it would have if it were
not Trustee. The Registrar and co-registrar and the Paying Agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in
this Article 10 with respect to any Senior Indebtedness of the Company which may
at any time be held by it, to the same extent as any other holder of such Senior
Indebtedness; and nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 10 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
SECTION 10.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of Senior
Indebtedness of the Company, the distribution may be made and the notice given
to their Representative (if any).
SECTION 10.11. ARTICLE 10 NOT TO PREVENT EVENTS OF DEFAULT OR
LIMIT RIGHT TO ACCELERATE. The failure to make a payment pursuant to the
Securities by reason of any provision in this Article 10 shall not be construed
as preventing the occurrence of a Default. Nothing in this Article 10 shall have
any effect on the right of the Securityholders or the Trustee to accelerate the
maturity of the Securities.
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SECTION 10.12. TRUST MONEYS NOT SUBORDINATED. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article 8 by the Trustee for
the payment of principal of and interest on the Securities shall not be
subordinated to the prior payment of any Senior Indebtedness or subject to the
restrictions set forth in this Article 10, and none of the Securityholders shall
be obligated to pay over any such amount to the Company or any holder of Senior
Indebtedness of the Company or any other creditor of the Company, so long as the
foregoing subordination provisions contained in this Article 10 were not
violated at the time the respective amounts were deposited pursuant to the
defeasance provisions of Article 8.
SECTION 10.13. TRUSTEE ENTITLED TO RELY. Upon any payment or
distribution pursuant to this Article 10, the Trustee and the Securityholders
shall be entitled to rely (i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 10.02
are pending, (ii) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Trustee or to the
Security holders or (iii) upon the Representatives for the holders of Senior
Indebtedness of the Company for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of such Senior
Indebtedness and other Indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 10. In the event that the Trustee
determines, in good faith, that evidence is required with respect to the right
of any Person as a holder of Senior Indebtedness of the Company to participate
in any payment or distribution pursuant to this Article 10, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and other facts pertinent to the rights of such Person under this
Article 10, and, if such evidence is not furnished, the Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections 7.01 and 7.02 shall
be applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 10.
SECTION 10.14. TRUSTEE TO EFFECTUATE SUBORDINATION. Each
Securityholder by accepting a Security author-
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izes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination between
the Securityholders and the holders of Senior Indebtedness of the Company as
provided in this Article 10 and appoints the Trustee as attorney-in-fact for any
and all such purposes.
SECTION 10.15. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall mistakenly pay over or distribute to Securityholders or the Company or any
other Person, money or assets to which any holders of Senior Indebtedness of the
Company shall be entitled by virtue of this Article 10 or otherwise.
SECTION 10.16. RELIANCE BY HOLDERS OF SENIOR INDEBTEDNESS ON
SUBORDINATION PROVISIONS. Each Securityholder by accepting a Security
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of the Company, whether such Senior Indebtedness was created or
acquired before or after the issuance of the Securities, to acquire and continue
to hold, or to continue to hold, such Senior Indebtedness and such holder of
such Senior Indebtedness shall be deemed conclusively to have relied on such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Indebtedness.
ARTICLE 11
GUARANTIES
SECTION 11.01. GUARANTIES. Each Guarantor hereby
unconditionally and irrevocably guarantees, jointly and severally, on a Senior
Subordinated basis, to each Holder and to the Trustee and its successors and
assigns (a) the full and punctual payment of principal of and interest on the
Securities when due, whether at maturity, by acceleration, by redemption or
otherwise, and all other monetary obligations of the Company under this
Indenture and the Securities and (b) the full and punctual performance within
applicable grace periods of all other obligations of the Company under this
Indenture and the Securities (all the foregoing being hereinafter collectively
called the "Indenture Obligations"). Each Guarantor further agrees that the
Indenture Obligations may be extended or renewed, in whole or in part, without
notice or further assent from such Guarantor and that such Guarantor will remain
bound
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under this Article 11 notwithstanding any extension or renewal of any Indenture
Obligation.
Each Guarantor waives presentation to, demand of, payment from
and protest to the Company of any of the Indenture Obligations and also waives
notice of protest for nonpayment. Each Guarantor waives notice of any default
under the Securities or the Indenture Obligations. The obligations of each
Guarantor hereunder shall not be affected by (a) the failure of any Holder or
the Trustee to assert any claim or demand or to enforce any right or remedy
against the Company or any other Person under this Indenture, the Securities or
any other agreement or other wise; (b) any extension or renewal of any thereof;
(c) any rescission, waiver, amendment or modification of any of the terms or
provisions of this Indenture, the Securities or any other agreement; (d) the
release of any security held by any Holder or the Trustee for the Indenture
Obligations or any of them; (e) the failure of any Holder or the Trustee to
exercise any right or remedy against any other guarantor of the Indenture
Obligations; or (f) any change in the ownership of such Guarantor.
Each Guarantor further agrees that its Guaranty herein
constitutes a guarantee of payment, performance and compliance when due (and not
a guarantee of collection) and waives any right to require that any resort be
had by any Holder or the Trustee to any security held for payment of the
Indenture Obligations.
Each Guaranty is, to the extent and in the manner set forth in
Article 12, subordinated and subject in right of payment to the prior payment in
full in cash of all Obligations with respect to all Senior Indebtedness of the
Guarantor giving such Guaranty and each Guaranty is made subject to such
provisions of this Indenture.
Except as expressly set forth in Sections 8.01(b), 11.02 and
11.06, the obligations of each Guarantor hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason, including any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense of setoff, counterclaim, recoupment or termination
whatsoever or by reason of the invalidity, illegality or unenforceability of the
Indenture Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of each Guarantor herein shall not be discharged or
impaired or otherwise affected by the failure of any Holder or the Trustee to
assert any claim or demand or to enforce any remedy under this Indenture, the
Securities or any other agreement, by any waiver or modifi-
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cation of any thereof, by any default, failure or delay, willful or otherwise,
in the performance of the obligations, or by any other act or thing or omission
or delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of such Guarantor or would otherwise operate as a discharge
of such Guarantor as a matter of law or equity.
Each Guarantor further agrees that its Guarantee herein shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of or interest on any Indenture
Obligation is rescinded or must otherwise be restored by any Holder or the
Trustee upon the bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any
other right which any Holder or the Trustee has at law or in equity against any
Guarantor by virtue hereof, upon the failure of the Company to pay the principal
of or interest on any Indenture Obligation when and as the same shall become
due, whether at maturity, by acceleration, by redemption or otherwise, or to
perform or comply with any other Indenture Obligation, each Guarantor hereby
promises to and will, upon receipt of written demand by the Trustee, forthwith
pay, or cause to be paid, in cash, to the Holders or the Trustee an amount equal
to the sum of (1) the unpaid amount of such Indenture Obligations, (2) accrued
and unpaid interest on such Indenture Obligations (but only to the extent not
prohibited by law) and (3) all other monetary Indenture Obligations of the
Company to the Holders and the Trustee.
Each Guarantor agrees that it shall not be entitled to any
right of subrogation in respect of any Indenture Obligations guaranteed hereby
until payment in full of all Indenture Obligations and all obligations to which
the Indenture Obligations are subordinated as provided in Article 12. Each
Guarantor further agrees that, as between it, on the one hand, and the Holders
and the Trustee, on the other hand, (x) the maturity of the Indenture
Obligations Guaranteed hereby may be accelerated as provided in Article 6 for
the purposes of such Guarantor's Guaranty herein, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Indenture Obligations guaranteed hereby, and (y) in the event of any declaration
of acceleration of such obligations as provided in Article 6, such Indenture
Obligations (whether or not due and payable) shall forthwith become due and
payable by such Guarantor for the purposes of this Section.
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Each Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees) incurred by the Trustee or any
Holder in enforcing any rights under this Section.
SECTION 11.02. LIMITATION ON LIABILITY; CONTRIBUTION. Any term
or provision of this Indenture to the contrary notwithstanding, the maximum,
aggregate amount of the Indenture Obligations guaranteed hereunder by any
Subsidiary Guarantor shall not exceed the maximum amount that can be hereby
guaranteed without rendering this Indenture, as it relates to such Subsidiary
Guarantor, voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors generally.
Each Subsidiary Guarantor that makes a payment under its
Subsidiary Guaranty will be entitled to a contribution from each other
Subsidiary Guarantor in an amount equal to such other Subsidiary Guarantor's PRO
RATA portion of such payment based on the respective net assets of all the
Subsidiary Guarantors at the time of such payment determined in accordance with
GAAP.
SECTION 11.03. SUCCESSORS AND ASSIGNS. This Article 11 shall
be binding upon each Guarantor and its successors and assigns and shall inure to
the benefit of the successors and assigns of the Trustee and the Holders and, in
the event of any transfer or assignment of rights by any Holder or the Trustee,
the rights and privileges conferred upon that party in this Indenture and in the
Securities shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.
SECTION 11.04. NO WAIVER. Neither a failure nor a delay on the
part of either the Trustee or the Holders in exercising any right, power or
privilege under this Article 11 shall operate as a waiver thereof, nor shall a
single or partial exercise thereof preclude any other or further exercise of any
right, power or privilege. The rights, remedies and benefits of the Trustee and
the Holders herein expressly specified are cumulative and not exclusive of any
other rights, remedies or benefits which either may have under this Article 11
at law, in equity, by statute or otherwise.
SECTION 11.05. MODIFICATION. No modification, amendment or
waiver of any provision of this Article 11, nor the consent to any departure by
any Guarantor therefrom, shall in any event be effective unless the same shall
be in
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writing and signed by the Trustee, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on any Guarantor in any case shall entitle such Guarantor to
any other or further notice or demand in the same, similar or other
circumstances.
SECTION 11.06. RELEASE OF SUBSIDIARY GUARANTOR. Upon the sale
(including any sale pursuant to any exercise of remedies by a holder of Senior
Indebtedness) or other disposition (including by way of consolidation or merger)
of a Subsidiary Guarantor or the sale or disposition of all or substantially all
the assets of such Subsidiary Guarantor (in each case other than to the Company
or an Affiliate of the Company), such Subsidiary Guarantor shall be deemed
released from all obligations under this Article 11 without any further action
required on the part of the Trustee or any Holder. At the request of the
Company, the Trustee shall execute and deliver an appropriate instrument
evidencing such release.
ARTICLE 12
SUBORDINATION OF GUARANTIES
SECTION 12.01. AGREEMENT TO SUBORDINATE. Each Guarantor
agrees, and each Securityholder by accepting a Security agrees, that the
Indenture Obligations (as used in this Article 12, the "Indenture Obligations"
of each Guarantor shall mean all Indenture Obligations guaranteed by such
Guarantor pursuant to Article 11 hereof) of such Guarantor are subordinated in
right of payment, to the extent and in the manner provided in this Article 12,
to the prior payment in full in cash of all Obligations with respect to Senior
Indebtedness of such Guarantor and that the subordination is for the benefit of
and enforceable by the holders of such Senior Indebtedness. The Indenture
Obligations of a Guarantor shall in all respects rank PARI PASSU with all other
Senior Subordinated Indebtedness of such Guarantor and only Senior Indebtedness
of such Guarantor (including such Guarantor's Guarantee of Senior Indebtedness
of the Company) shall rank senior to the Indenture Obligations of such Guarantor
in accordance with the provisions set forth herein.
SECTION 12.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY. Upon any
payment or distribution of the assets of any Guarantor to creditors upon a total
or partial liqui-
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dation or a total or partial dissolution or winding up of such Guarantor or upon
any assignment for the benefit of creditors or marshalling of assets for such
Guarantor or in a bankruptcy, reorganization, insolvency, receivership or
similar proceeding relating to such Guarantor or its property, whether voluntary
or involuntary:
(1) the holders of Senior Indebtedness of such Guarantor shall
be entitled to receive payment in full in cash of all Obligations with
respect to such Senior Indebtedness (including all interest accruing
subsequent to the filing of a petition in bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) before
Securityholders shall be entitled to receive any payment or
distribution with respect to any Indenture Obligations of such
Guarantor; and
(2) until all Obligations with respect to the Senior
Indebtedness of any Guarantor is paid in full in cash, any payment or
distribution to which Security holders would be entitled but for this
Article 12 shall be made to holders of such Senior Indebtedness as
their interests may appear, except that securityholders may, in any
proceeding of the type described in Section 10.02 with respect to such
Guarantor, receive securities of the Parent and/or the Company as
provided in clause (2) of Section 10.02, which, in the case of debt
securities of the Company, may be guaranteed by the Guarantors on
substantially the same basis as provided in Article 11, so long as such
guarantees are expressly subordinated to all Senior Indebtedness at
least to the same extent as provided in this Article 12.
SECTION 12.03. DEFAULT ON SENIOR INDEBTEDNESS OF GUARANTOR. No
Guarantor may make any payment (in cash, property or other assets) pursuant to
any of its Indenture Obligations or repurchase, redeem or otherwise retire or
defease any Securities or other Indenture Obligations (collectively, "pay its
Guaranty") if either of the following Payment Default occurs: (1) any
Obligations with respect to Senior Indebtedness of the Company is not paid in
full when due or (2) any other default on Senior Indebtedness of the Company
occurs and the maturity of such Senior Indebtedness is accelerated in accordance
with its terms unless, in either case, (x) the default has been cured or waived
and any such acceleration has been rescinded in writing or (y) such Senior
Indebtedness has been paid in full in cash; PROVIDED, HOWEVER, that any
Guarantor may pay
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its Guaranty without regard to the foregoing if such Guarantor and the Trustee
receive written notice approving such payment from the Representatives of such
Senior Indebtedness. No Guarantor may pay its Guaranty during the continuance of
any Payment Blockage Period after receipt by the Company and the Trustee (with a
copy to the Company) of a Blockage Notice under Section 10.03. Notwithstanding
the provisions described in the immediately preceding sentence (but subject to
the provisions contained in the first sentence of this Section), unless the
holders of Designated Senior Indebtedness giving such Blockage Notice or the
Representative of such holders shall have accelerated the maturity of such
Designated Senior Indebtedness, any Guarantor may resume payments pursuant to
its Guaranty after termination of such Payment Blockage Period.
SECTION 12.04. DEMAND FOR PAYMENT. If a demand for payment is
made on a Guarantor pursuant to Article 11, the Trustee shall promptly notify
the holders of the Designated Senior Indebtedness (or their Representatives) of
such demand. If any Designated Senior Indebtedness is outstanding at the time of
such acceleration, neither the Company nor any Subsidiary Guarantor may pay the
Securities until five Business Days after the Representatives of all the issues
of Designated Senior Indebtedness receive notice of such acceleration and,
thereafter, may pay the Securities only if the Indenture otherwise permits
payment at that time.
SECTION 12.05. WHEN DISTRIBUTION MUST BE PAID OVER. If a
distribution is made to Securityholders that because of this Article 12 should
not have been made to them, the Securityholders who receive the distribution
shall hold it in trust for holders of the relevant Senior Indebtedness and pay
it over to them or their Representatives as their interests may appear.
SECTION 12.06. SUBROGATION. After all Senior Indebtedness of a
Guarantor is paid in full in cash and until the Securities are paid in full,
Securityholders shall be subrogated to the rights of holders of such Senior
Indebtedness to receive distributions applicable to Senior Indebtedness. A
distribution made under this Article 12 to holders of such Senior Indebtedness
which otherwise would have been made to Securityholders is not, as between the
relevant Guarantor and Securityholders, a payment by such Guarantor on such
Senior Indebtedness.
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SECTION 12.07. RELATIVE RIGHTS. This Article 12 defines the
relative rights of Securityholders and holders of Senior Indebtedness of a
Guarantor. Nothing in this Indenture shall:
(1) impair, as between a Guarantor and Security holders, the
obligation of such Guarantor, which is absolute and unconditional, to
pay the Indenture Obligations to the extent set forth in Article 11 or
the relevant Guaranty; or
(2) prevent the Trustee or any Securityholder from exercising
its available remedies upon a default by such Guarantor under the
Indenture Obligations, subject to the rights of holders of Senior
Indebtedness of such Guarantor to receive distributions otherwise
payable to Securityholders.
SECTION 12.08. SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY.
No right of any holder of Senior Indebtedness of any Guarantor to enforce the
subordination of the Indenture Obligations of such Guarantor shall be impaired
by any act or failure to act by such Guarantor or by its failure to comply with
this Indenture.
SECTION 12.09. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding Section 12.03, the Trustee or Paying Agent may continue to make
payments on any Guaranty and shall not be charged with knowledge of the
existence of facts that would prohibit the making of any such payments unless,
not less than two Business Days prior to the date of such payment, a Trust
Officer of the Trustee receives written notice satisfactory to it that payments
may not be made under this Article 12. The Company, the relevant Guarantor, the
Registrar or co-registrar, the Paying Agent, a Representative or a holder of
Senior Indebtedness of the relevant Guarantor may give the notice.
The Trustee in its individual or any other capacity may hold
Senior Indebtedness with the same rights it would have if it were not the
Trustee. The Registrar and co-registrar and the Paying Agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in
this Article 12 with respect to any Senior Indebtedness of any Guarantor which
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness; and nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 12 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
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SECTION 12.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of Senior
Indebtedness of any Guarantor, the distribution may be made and the notice given
to their Representative (if any).
SECTION 12.11. ARTICLE 12 NOT TO PREVENT DEFAULTS UNDER A
GUARANTY OR LIMIT RIGHT TO DEMAND PAYMENT. The failure to make a payment
pursuant to a Guaranty by reason of any provision in this Article 12 shall not
be construed as preventing the occurrence of a default under such Guaranty.
Nothing in this Article 12 shall have any effect on the right of the
Securityholders or the Trustee to make a demand for payment on any Guarantor
pursuant to Article 11 or the relevant Guaranty.
SECTION 12.12. TRUSTEE ENTITLED TO RELY. Upon any payment or
distribution pursuant to this Article 12, the Trustee and the Securityholders
shall be entitled to rely (1) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 12.02
are pending, (2) upon a certificate of the liquidating trustee or agent or other
Person making such payment or distribution to the Trustee or to the Security
holders or (3) upon the Representatives for the holders of Senior Indebtedness
of any Guarantor for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of such Senior
Indebtedness and other indebtedness of such Guarantor, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 12. In the event that the Trustee
determines, in good faith, that evidence is required with respect to the right
of any Person as a holder of Senior Indebtedness of any Guarantor to participate
in any payment or distribution pursuant to this Article 12, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of Senior Indebtedness of such Guarantor held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and other facts pertinent to the rights of such Person
under this Article 12, and, if such evidence is not furnished, the Trustee may
defer any payment to such Person pending judicial determination as to the right
of such Person to receive such payment. The provisions of Sections 7.01 and 7.02
shall be applicable to all actions or omissions of actions by the Trustee
pursuant to this Article 12.
SECTION 12.13. TRUSTEE TO EFFECTUATE SUBORDINATION. Each
Securityholder by accepting a Security author-
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izes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to acknowledge or effectuate the subordination between
the Securityholders and the holders of Senior Indebtedness of any Guarantor as
provided in this Article 12 and appoints the Trustee as attorney-in-fact for any
and all such purposes.
SECTION 12.14. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR
INDEBTEDNESS OF GUARANTOR. The Trustee shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness of any Guarantor and shall not be
liable to any such holders if it shall mistakenly pay over or distribute to
Securityholders or the Company or any other Person, money or assets to which any
holders of such Senior Indebtedness shall be entitled by virtue of this Article
12 or otherwise.
SECTION 12.15. RELIANCE BY HOLDERS OF SENIOR INDEBTEDNESS ON
SUBORDINATION PROVISIONS. Each Securityholder by accepting a Security
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of any Guarantor, whether such Senior Indebtedness was created or
acquired before or after the issuance of the Securities, to acquire and continue
to hold, or to continue to hold, such Senior Indebtedness and such holder of
Senior Indebtedness shall be deemed conclusively to have relied on such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Indebtedness.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01. TRUST INDENTURE ACT CONTROLS. If any provision
of this Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 13.02. NOTICES. Any notice or communication shall
be in writing and delivered in person or mailed by first-class mail addressed
as follows:
if to Parent, the Company or any Subsidiary Guarantor:
Xxxxxxxxx Semiconductor Corporation
000 Xxxxxxx Xxxxxx, Mail Stop 00-00
Xxxxx Xxxxxxxx, Xxxxx 00000
Attention of General Counsel
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if to the Trustee:
United States Trust Company of New York
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Division
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Security holder shall
be mailed to the Securityholder at the Securityholder's address as it appears on
the registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.03. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 13.04. CERTIFICATE AND OPINION AS TO CONDITIONS
PRECEDENT. Upon any request or application by the Company to the Trustee to take
or refrain from taking any action under this Indenture, the Company shall
furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
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103
SECTION 13.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a covenant or
condition provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 13.06. WHEN SECURITIES DISREGARDED. In determining
whether the Holders of the required principal amount of Securities have
concurred in any direction, waiver or consent, Securities owned by the Company
or by any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company shall be disregarded and
deemed not to be outstanding, except that, for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Securities which the Trustee knows are so owned shall be so
disregarded. Also, subject to the fore going, only Securities outstanding at the
time shall be considered in any such determination.
SECTION 13.07. RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR.
The Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
SECTION 13.08. LEGAL HOLIDAYS. A "Legal Holiday" is a
Saturday, a Sunday or a day on which banking institutions are not required to be
open in the State of New York. If a payment date is a Legal Holiday, payment
shall be made on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period. If a regular record date is a
Legal Holiday, the record date shall not be affected.
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SECTION 13.09. GOVERNING LAW. This Indenture and the
Securities shall be governed by, and construed in accordance with, the laws of
the State of New York but without giving effect to applicable principles of
conflicts of law to the extent that the application of the laws of another
jurisdiction would be required thereby.
SECTION 13.10. NO RECOURSE AGAINST OTHERS. A director,
officer, employee or stockholder, as such, of the Company or any Guarantor shall
not have any liability for any obligations of the Company or any Guarantor under
the Securities, any Guaranty or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder shall waive and release all such liability. The
waiver and release shall be part of the consideration for the issue of the
Securities.
SECTION 13.11. SUCCESSORS. All agreements of the
Company in this Indenture and the Securities shall bind its
successors. All agreements of the Trustee in this Indenture
shall bind its successors.
SECTION 13.12. MULTIPLE 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. One signed copy is enough to
prove this Indenture.
SECTION 13.13. TABLE OF CONTENTS; HEADINGS. The table of
contents, cross-reference sheet and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
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105
IN WITNESS WHEREOF, the parties have caused this Indenture to
be duly executed as of the date first written above.
XXXXXXXXX SEMICONDUCTOR
CORPORATION,
by
-------------------------------
Xxxxxx X. Xxxxxx
Executive Vice President
and Chief Financial
Officer
FSC SEMICONDUCTOR CORPORATION,
as Guarantor,
by
-------------------------------
Xxxxxx X. Xxxxxx
Executive Vice President
and Chief Financial
Officer
XXXXXXXXX SEMICONDUCTOR
CORPORATION OF CALIFORNIA, as
Guarantor
by
--------------------------------
Xxxxxx X. Xxxxxx
Executive Vice President
and Chief Financial
Officer
UNITED STATES TRUST COMPANY OF
NEW YORK, as Trustee,
by
--------------------------------
Name:
Title:
106
RULE 144A/REGULATION S APPENDIX
FOR OFFERINGS TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT TO
RULE 144A AND TO CERTAIN PERSONS IN OFFSHORE TRANSACTIONS IN
RELIANCE ON REGULATION S.
PROVISIONS RELATING TO INITIAL SECURITIES,
PRIVATE EXCHANGE SECURITIES
AND EXCHANGE SECURITIES
1. DEFINITIONS
1.1 DEFINITIONS
For the purposes of this Appendix the following terms shall have the
meanings indicated below:
"Depository" means The Depository Trust Company, its nominees
and their respective successors.
"Exchange Securities" means(i) the 10-3/8% Senior Subordinated
Notes Due 2007 to be issued pursuant to this Indenture in connection with a
Registered Exchange Offer pursuant to the Registration Rights Agreement and (ii)
Additional Securities, if any, issued pursuant to a registration statement filed
with the SEC under the Securities Act.
"Initial Purchasers" means (i) with respect to the Initial
Securities issued on the Issue Date, Credit Suisse First Boston Corporation,
Xxxxxx Xxxxxxx & Co. Incorporated, Xxxxxxx Xxxxx Barney Inc. and Fleet
Securities, Inc. and (ii) with respect to each issuance of Additional
Securities, the Persons purchasing such Additional Securities under the
related Purchase Agreement.
"Initial Securities" means (i) $300,000,000 10-3/8% Senior
Subordinated Notes Due 2007, issued under this Indenture on the Issue Date and
(ii) Additional Securities, if any, issued in a transaction exempt from the
registration requirements of the Securities Act.
"Private Exchange" means the offer by the Company, pursuant to
the Registration Rights Agreement, to the Initial Purchasers to issue and
deliver to the relevant Initial Purchaser, in exchange for the Initial
Securities held by the Initial Purchaser as part of its initial distribution, if
any, a like aggregate principal amount of Private Exchange Securities.
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2
"Private Exchange Securities" means any 10-3/8% Senior
Subordinated Notes Due 2007 issued in connection with a Private Exchange.
"Purchase Agreement" means (i) with respect to the Initial
Securities issued on the Issue Date the Purchase Agreement dated March 30, 1999,
among the Company, the Guarantors named therein and the Initial Purchasers and
(ii) with respect to each issuance of Additional Securities, the purchase
agreement or underwriting agreement among the Company and the Persons purchasing
such Additional Securities.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Registered Exchange Offer" means the offer by the Company,
pursuant to the Registration Rights Agreement, to certain Holders of Initial
Securities, to issue and deliver to such Holders, in exchange for the Initial
Securities, a like aggregate principal amount of Exchange Securities registered
under the Securities Act.
"Registration Rights Agreement" means (i) with respect to the
Initial Securities issued on the Issue Date, the Registration Rights Agreement
dated March 30, 1999, among the Company, the Guarantors named therein and the
Initial Purchasers and (ii) with respect to each issuance of Additional
Securities issued in a transaction exempt from the registration requirements of
the Securities Act, the registration rights agreement, if any, among the Company
and the Persons purchasing such Additional Securities under the related Purchase
Agreement.
"Securities" means the Initial Securities, the Exchange
Securities and the Private Exchange Securities, treated as a single class.
"Securities Act" means the Securities Act of 1933.
"Securities Custodian" means the custodian with respect to a
Global Security (as appointed by the Depository), or any successor person
thereto and shall initially be the Trustee.
"Shelf Registration Statement" means the registration
statement issued by the Company, in connection with the offer and sale of
Initial Securities or Private
Exchange Securities, pursuant to the Registration Rights Agreement.
"Transfer Restricted Securities" means Securities that bear or
are required to bear the legend set forth in Section 2.3(b) hereto.
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4
1.2 OTHER DEFINITIONS
DEFINED IN
TERM SECTION:
---- ------------
"Agent Members"............................................................2.1(b)
"Global Security"..........................................................2.1(a)
"Regulation S".............................................................2.1(a)
"Rule 144A"................................................................2.1(a)
2. THE SECURITIES.
2.1 FORM AND DATING.
The Initial Securities are being offered and sold by the
Company pursuant to the Purchase Agreement.
(a) GLOBAL SECURITIES. Initial Securities offered and sold to
a QIB in reliance on Rule 144A under the Securities Act ("Rule 144A") or in
reliance on Regulation S under the Securities Act ("Regulation S"), in each case
as provided in the Purchase Agreement, shall be issued initially in the form of
one or more permanent global Securities in definitive, fully registered form
without interest coupons with the global securities legend and restricted
securities legend set forth in Exhibit 1 hereto (each, a Global Security"),
which shall be deposited on behalf of the purchasers of the Initial Securities
represented thereby with the Trustee, at its New York office, as custodian for
the Depository (or with such other custodian as the Depository may direct), and
registered in the name of the Depository or a nominee of the Depository, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The aggregate principal amount of the Global Securities may from time
to time be increased or decreased by adjustments made on the records of the
Trustee and the Depository or its nominee as hereinafter provided.
(b) BOOK-ENTRY PROVISIONS. This Section 2.1(b) shall apply
only to a Global Security deposited with or on behalf of the Depository.
The Company shall execute and the Trustee shall, in accordance
with this Section 2.1(b), authenticate and deliver initially one or more Global
Securities that (a) shall be registered in the name of the Depository for such
Global Security or Global Securities or the nominee of
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5
such Depository and (b) shall be delivered by the Trustee to such Depository or
pursuant to such Depository's instructions or held by the Trustee as custodian
for the Depository.
Members of, or participants in, the Depository ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depository or by the Trustee as the
custodian of the Depository or under such Global Security, and the Depository
may be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its Agent Members, the
operation of customary practices of such Depository governing the exercise of
the rights of a holder of a beneficial interest in any Global Security.
(c) CERTIFICATED SECURITIES. Except as provided in this
Section 2.1 or Section 2.3 or 2.4, owners of beneficial interests in Global
Securities will not be entitled to receive physical delivery of certificated
Securities.
2.2 AUTHENTICATION. The Trustee shall authenticate and deliver: (1) On
the Issue Date, $300.0 million 10 3/8% Senior Subordinated Notes Due 2007, (2)
Any Additional Securities for an original issue in an aggregate principal amount
specified in the written order of the Company pursuant to Section 2.02 of the
Indenture and (3) Exchange Securities or Private Exchange Securities in exchange
therefor for issue only in a Registered Exchange Offer or a Private Exchange,
respectively, pursuant to the Registration Rights Agreement, for a like
principal amount of Initial Securities, in each case upon a written order of the
Company signed by two Officers or by an Officer and either an Assistant
Treasurer or an Assistant Secretary of the Company. Such order shall specify the
amount of the Securities to be authenticated and the date on which the original
issue of Securities is to be authenticated and whether the Securities are to be
Initial Securities, Exchange Securities or Private Exchange Securities. In
addition, in the case of an issuance of Additional Securities pursuant to
Section 2.13 of the Indenture, such
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6
order shall certify that such issuance is in compliance with Section 4.03 of
the Indenture.
2.3 TRANSFER AND EXCHANGE. (a) TRANSFER AND EXCHANGE OF GLOBAL
SECURITIES. (i) The transfer and exchange of Global Securities or beneficial
interests therein shall be effected through the Depository, in accordance with
this Indenture (including applicable restrictions on transfer set forth herein,
if any) and the procedures of the Depository therefor. A transferor of a
beneficial interest in a Global Security shall deliver to the Registrar a
written order given in accordance with the Depositary's procedures containing
information regarding the participant account of the Depositary to be credited
with a beneficial interest in the Global Security. The Registrar shall, in
accordance with such instructions instruct the Depositary to credit to the
account of the Person specified in such instructions a beneficial interest in
the Global Security and to debit the account of the Person making the transfer
the beneficial interest in the Global Security being transferred.
(ii) Notwithstanding any other provisions of this Appendix
(other than the provisions set forth in Section 2.4), a Global Security
may not be transferred as a whole except by the Depository to a nominee
of the Depository or by a nominee of the Depository to the Depository
or another nominee of the Depository or by the Depository or any such
nominee to a successor Depository or a nominee of such successor
Depository.
(iii) In the event that a Global Security is exchanged for
Securities in definitive registered form pursuant to Section 2.4 or
Section 2.09 of the Indenture, prior to the consummation of a
Registered Exchange Offer or the effectiveness of a Shelf Registration
Statement with respect to such Securities, such Securities may be
exchanged only in accordance with such procedures as are substantially
consistent with the provisions of this Section 2.3 (including the
certification requirements set forth on the reverse of the Initial
Securities intended to ensure that such transfers comply with Rule 144A
or Regulation S, as the case may be) and such other procedures as may
from time to time be adopted by the Company.
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7
(b) LEGEND.
(i) Except as permitted by the following paragraphs (ii),
(iii) and (iv), each Security certificate evidencing the Global
Securities (and all Securities issued in exchange therefor or in
substitution thereof) shall bear a legend in substantially the
following form:
"THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THIS
SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED
THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES
ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I)
THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL,
AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted
Security represented by a Global Security pursuant to Rule 144 under
the Securities Act, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a certificated
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8
Security that does not bear the legend set forth above and rescind any
restriction on the transfer of such Transfer Restricted Security, if
the Holder certifies in writing to the Registrar that its request for
such exchange was made in reliance on Rule 144 (such certification to
be in the form set forth on the reverse of the Security).
(iii) After a transfer of any Initial Securities or Private
Exchange Securities during the period of the effectiveness of a Shelf
Registration Statement with respect to such Initial Securities or
Private Exchange Securities, as the case may be, all requirements
pertaining to legends on such Initial Security or such Private Exchange
Security will cease to apply, the requirements requiring any such
Initial Security or such Private Exchange Security issued to certain
Holders be issued in global form will cease to apply, and a
certificated Initial Security or Private Exchange Security without
legends will be available to the transferee of the Holder of such
Initial Securities or Private Exchange Securities upon exchange of such
transferring Holder's certificated Initial Security or Private Exchange
Security or directions to transfer such Holder's interest in the Global
Security, as applicable.
(iv) Upon the consummation of a Registered Exchange Offer with
respect to the Initial Securities pursuant to which Holders of such
Initial Securities are offered Exchange Securities in exchange for
their Initial Securities, all requirements pertaining to such Initial
Securities that Initial Securities issued to certain Holders be issued
in global form will cease to apply and certificated Initial Securities
with the restricted securities legend set forth in Exhibit 1 hereto
will be available to Holders of such Initial Securities that do not
exchange their Initial Securities, and Exchange Securities in
certificated or global form will be available to Holders that exchange
such Initial Securities in such Registered Exchange Offer.
(v) Upon the consummation of a Private Exchange with respect
to the Initial Securities pursuant to which Holders of such Initial
Securities are offered Private Exchange Securities in exchange for
their Initial Securities, all requirements pertaining to such
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9
Initial Securities that Initial Securities issued to certain Holders be
issued in global form will still apply, and Private Exchange Securities
in global form with the Restricted Securities Legend set forth in
Exhibit 1 hereto will be available to Holders that exchange such
Initial Securities in such Private Exchange.
(C) CANCELLATION OR ADJUSTMENT OF GLOBAL SECURITY. At such
time as all beneficial interests in a Global Security have been exchanged for
certificated Securities, redeemed, repurchased or canceled, such Global Security
shall be returned to the Depository for cancellation or retained and canceled by
the Trustee. At any time prior to such cancellation, if any beneficial interest
in a Global Security is exchanged for certificated Securities, redeemed,
repurchased or canceled, the principal amount of Securities represented by such
Global Security shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Securities Custodian for such
Global Security) with respect to such Global Security, by the Trustee or the
Securities Custodian, to reflect such reduction.
(D) OBLIGATIONS WITH RESPECT TO TRANSFERS AND
EXCHANGES OF SECURITIES.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate certificated
Securities and Global Securities at the Registrar's or co-registrar's
request.
(ii) No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any
such transfer taxes, assessments or similar governmental charge payable
upon exchange or transfer pursuant to Sections 3.06, 4.09 and 9.05).
(iii) The Registrar or co-registrar shall not be required to
register the transfer of or exchange of (a) any certificated Security
selected for redemption in whole or in part pursuant to Article 3 of
this Indenture, except the unredeemed portion of any certificated
Security being redeemed in part, or
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10
(b) any Security for a period beginning 15 Business Days before the
mailing of a notice of an offer to repurchase or redeem Securities or
15 Business Days before an interest payment date.
(iv) Prior to the due presentation for registration of
transfer of any Security, the Company, the Trustee, the Paying Agent,
the Registrar or any co-registrar may deem and treat the person in
whose name a Security is registered as the absolute owner of such
Security for the purpose of receiving payment of principal of and
interest on such Security and for all other purposes whatsoever,
whether or not such Security is overdue, and none of the Company, the
Trustee, the Paying Agent, the Registrar or any co-registrar shall be
affected by notice to the contrary.
(v) All Securities issued upon any transfer or exchange
pursuant to the terms of this Indenture shall evidence the same debt
and shall be entitled to the same benefits under this Indenture as the
Securities surrendered upon such transfer or exchange.
(E) NO OBLIGATION OF THE TRUSTEE.
(i) The Trustee shall have no responsibility or obligation to
any beneficial owner of a Global Security, a member of, or a
participant in the Depository or other Person with respect to the
accuracy of the records of the Depository or its nominee or of any
participant or member thereof, with respect to any ownership interest
in the Securities or with respect to the delivery to any participant,
member, beneficial owner or other Person (other than the Depository) of
any notice (including any notice of redemption) or the payment of any
amount, under or with respect to such Securities. All notices and
communications to be given to the Holders and all payments to be made
to Holders under the Securities shall be given or made only to or upon
the order of the registered Holders (which shall be the Depository or
its nominee in the case of a Global Security). The rights of beneficial
owners in any Global Security shall be exercised only through the
Depository subject to the applicable rules and procedures of the
Depository. The Trustee may rely and shall be fully protected in
relying upon information furnished by the Depository with respect to
its members, participants and any beneficial owners.
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11
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Security (including any transfers
between or among Depository participants, members or beneficial owners
in any Global Security) other than to require delivery of such
certificates and other documentation or evidence as are expressly
required by, and to do so if and when expressly required by, the terms
of this Indenture, and to examine the same to determine substantial
compliance as to form with the express requirements hereof.
2.4 CERTIFICATED SECURITIES.
(a) A Global Security deposited with the Depository or with
the Trustee as custodian for the Depository pursuant to Section 2.1 shall be
transferred to the beneficial owners thereof in the form of certificated
Securities in an aggregate principal amount equal to the principal amount of
such Global Security, in exchange for such Global Security, only if such
transfer complies with Section 2.3 and (i) the Depository notifies the Company
that it is unwilling or unable to continue as Depository for such Global
Security or if at any time such Depository ceases to be a "clearing agency"
registered under the Exchange Act and, in either case, a successor depositary is
not appointed by the Company within 90 days of such notice, or (ii) an Event of
Default has occurred and is continuing or (iii) the Company, in its sole
discretion, notifies the Trustee in writing that it elects to cause the issuance
of certificated Securities under this Indenture.
(b) Any Global Security that is transferable to the beneficial
owners thereof pursuant to this Section shall be surrendered by the Depository
to the Trustee located in the Borough of Manhattan, The City of New York, to be
so transferred, in whole or from time to time in part, without charge, and the
Trustee shall authenticate and deliver, upon such transfer of each portion of
such Global Security, an equal aggregate principal amount of certificated
Initial Securities of authorized denominations. Any portion of a Global Security
transferred pursuant to this Section shall be executed, authenticated and
delivered only in denominations of $1,000 and any integral multiple thereof and
registered in such names as the Depository shall direct. Any certificated
Initial Security delivered in exchange for
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12
an interest in the Global Security shall, except as otherwise provided by
Section 2.3(b), bear the restricted securities legend set forth in Exhibit 1
hereto.
(c) Subject to the provisions of Section 2.4(b), the
registered Holder of a Global Security may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.
(d) In the event of the occurrence of any of the events
specified in Section 2.4(a), the Company will promptly make available to the
Trustee a reasonable supply of certificated Securities in definitive, fully
registered form without interest coupons.
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EXHIBIT 1
to
RULE 144A/REGULATION S APPENDIX
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE
SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHER WISE
TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH
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2
RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS
SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
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CUSIP NO.
No. ________ $___________
10-3/8% Senior Subordinated Notes Due 2007
Xxxxxxxxx Semiconductor Corporation, a Delaware corporation,
promises to pay to CEDE & CO., or registered assigns, the principal sum of
__________ Dollars on October 1, 2007.
Interest Payment Dates: April 1 and October 1
Record Dates: March 15 and September 15
Additional provisions of this Security are set forth on the
other side of this Security.
Dated: April 7, 1999
XXXXXXXXX SEMICONDUCTOR
CORPORATION,
by
---------------------------------
Name:
Title:
by
---------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee, certifies that
this is one of the Securities
referred to in the Indenture.
by
-----------------------------
Authorized Signatory
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[FORM OF REVERSE SIDE OF INITIAL SECURITY]
10-3/8% Senior Subordinated Note Due October 1, 2007
1. INTEREST
Xxxxxxxxx Semiconductor Corporation, a Delaware corporation
(such corporation, and its successors and assigns under the Indenture
hereinafter referred to, being herein called the "Company"), promises to pay
interest on the principal amount of this Security at the rate per annum shown
above; PROVIDED, HOWEVER, that if a Registration Default (as defined in the
Registration Rights Agreement) occurs, additional interest will accrue on this
Security at a rate of 0.50% per annum, increasing by 0.50% per annum on the 90th
day after such Registration Default and on every 90th day thereafter during the
continuation of any such Registration Default, from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all such Registration Defaults have been cured. The Company will pay
interest semiannually on April 1 and October 1 of each year. Interest on the
Securities will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from [April 7, 1999] [date of issuance of any
Additional Securities]. Interest will be computed on the basis of a 360-day year
of twelve 30-day months. The Company shall pay interest on overdue principal at
the rate borne by the Securities plus 1% per annum, and it shall pay interest on
overdue installments of interest at the same rate to the extent lawful.
2. METHOD OF PAYMENT
The Company will pay interest on the Securities (except
defaulted interest) to the Persons who are registered holders of Securities at
the close of business on March 15 or September 15 next preceding the interest
payment date even if Securities are canceled after the record date and on or
before the interest payment date. Holders must surrender Securities to a Paying
Agent to collect principal payments. The Company will pay principal and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts. Payments in respect of the Securities
represented by a Global Security (including principal, premium and interest)
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5
will be made by wire transfer of immediately available funds to the accounts
specified by The Depository Trust Company. The Company will make all payments in
respect of a certificated Security (including principal, premium and interest)
by mailing a check to the registered address of each Holder thereof; PROVIDED,
HOWEVER, that payments on a certificated Security will be made by wire transfer
to a U.S. dollar account maintained by the payee with a bank in the United
States if such Holder elects payment by wire transfer by giving written notice
to the Trustee or the Paying Agent to such effect designating such account no
later than 30 days immediately preceding the relevant due date for payment (or
such other date as the Trustee may accept in its discretion).
3. PAYING AGENT AND REGISTRAR
Initially, United States Trust Company of New York, a New York
banking corporation ("Trustee"), will act as Paying Agent and Registrar. The
Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. INDENTURE
The Company issued the Securities under an Indenture dated as
of April 7, 1999 ("Indenture"), among the Company, FSC Semiconductor
Corporation, Xxxxxxxxx Semiconductor Corporation of California and the Trustee.
The terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the "Act").
Terms defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms. The Company's obligations under the Securities are guaranteed by
the Parent and certain Restricted Subsidiaries of the Company.
The Securities are general unsecured obligations of the
Company. The Company shall be entitled, subject to its compliance with Section
4.03 of the Indenture, to issue Additional Securities pursuant to Section 2.13
of the Indenture. The Initial Securities issued on the Issue Date,
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6
any Additional Securities and all Exchange Securities or Private Exchange
Securities issued in exchange therefor will be treated as a single class for all
purposes under the Indenture. The Indenture limits, among other things (i) the
incurrence of additional debt by the Company and its subsidiaries, (ii) the
payment of dividends on capital stock of the Company and the purchase,
redemption or retirement of capital stock or subordinated indebtedness, (iii)
certain transactions with affiliates, (iv) sales of assets, including capital
stock of subsidiaries, and (v) certain consolidations, mergers and transfers of
assets. The Indenture also prohibits certain restrictions on distributions from
subsidiaries. All of these limitations and prohibitions, however, are subject to
a number of important qualifications contained in the Indenture.
5. OPTIONAL REDEMPTION
Except as set forth in the next paragraph, the Securities may
not be redeemed prior to April 1, 2003. On and after that date, the Company may
redeem the Securities in whole at any time or in part from time to time at the
following redemption prices (expressed in percentages of principal amount), plus
accrued interest to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the related
interest payment date):
if redeemed during the 12-month period beginning April 1,
PERIOD PERCENTAGE
------ ----------
2003.........................................................105.188%
2004.........................................................103.458
2005.........................................................101.729
2006 and thereafter..........................................100.000
In addition, at any time prior to April 1, 2002, the Company
may redeem up to 35% of the aggregate principal amount of Securities (which
includes Additional Securities, if any) with the proceeds of a Public Equity
Offering, at any time or from time to time, at a redemption price of 110.375% of
the principal amount thereof, plus accrued interest to redemption date (subject
to the right of Holders of record on the relevant record date to receive
interest
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7
due on the related interest payment date); PROVIDED, HOWEVER, that:
(1) at least 65% of such aggregate principal amount of
Securities (which includes Additional Securities, if any) remains
outstanding immediately after the occurrence of each such redemption
(other than the Securities held, directly or indirectly, by the Company
or its Affiliates); and
(2) each such redemption occurs within 90 days after the date
of the related Public Equity Offering.
6. SPECIAL REDEMPTION
In the event that (1) the Acquisition of the Power Device
Business is not consummated or (2) Samsung Electronics Co., Ltd. has not
received in cash the full purchase price for the Acquisition, in each case on or
prior to April 23, 1999, the Company shall redeem the Securities (the "Special
Redemption") at a redemption price of 100% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon (subject to the right of
holders of record on the relevant date to receive interest due on such date) to
the date of redemption. The Company shall prepare and deliver to the Trustee the
notice of the Special Redemption on or prior to the Business Day immediately
preceding, and the Trustee will send by first class mail a copy of such notice
to the holders of Securities on or prior to, April 26, 1999. The Company shall
redeem the Securities on or prior to May 3, 1999 or, in the event that the
Company does not have sufficient cash to redeem the Securities as a result of
any restriction imposed by Korean law, the Company shall redeem the Securities
on the earlier of (1) the fifth Business Day immediately following the date such
restriction is no longer applicable and (2) July 1, 1999.
7. NOTICE OF REDEMPTION
Except as set forth in paragraph 6 above, notice of optional
redemption will be mailed at least 30 days but not more than 60 days before the
redemption date to each Holder of Securities to be redeemed at his registered
address. Securities in denominations larger than $1,000 may be redeemed in part
but only in whole multiples of $1,000. If money sufficient to pay the redemption
price of and accrued interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the
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8
Paying Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Securities
(or such portions thereof) called for redemption.
8. PUT PROVISIONS
Upon a Change of Control, any Holder of Securities will have
the right, subject to certain conditions, to cause the Company to repurchase all
or any part of the Securities of such Holder at a repurchase price equal to 101%
of the principal amount of the Securities to be repurchased plus accrued
interest to the date of repurchase (subject to the right of holders of record on
the relevant record date to receive interest due on the related interest payment
date) as provided in, and subject to the terms of, the Indenture.
9. SUBORDINATION
The Securities are subordinated to Senior Indebtedness, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Securities may be paid. The Company agrees,
and each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give it
effect and appoints the Trustee as attorney-in-fact for such purpose.
10. DENOMINATIONS; TRANSFER; EXCHANGE
The Securities are in registered form without coupons in
denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.
11. PERSONS DEEMED OWNERS
The registered Holder of this Security may be treated as the
owner of it for all purposes.
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12. UNCLAIMED MONEY
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
13. DISCHARGE AND DEFEASANCE
Subject to certain conditions, the Company at any time may
terminate some or all of its obligations under the Securities and the Indenture
if the Company deposits with the Trustee money or U.S. Government Obligations
for the payment of principal and interest on the Securities to redemption or
maturity, as the case may be.
14. AMENDMENT, WAIVER
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and the Trustee may amend
the Indenture or the Securities to cure any ambiguity, omission, defect or
inconsistency, or to comply with Article 5 of the Indenture, or to provide for
uncertificated Securities in addition to or in place of certificated Securities,
or to add guarantees with respect to the Securities or to secure the Securities,
or to add additional covenants or surrender rights and powers conferred on the
Company, or to comply with any request of the SEC in connection with qualifying
the Indenture under the Act, or to make certain changes in the subordination
provisions, or to release a Subsidiary Guaranty when permitted by the Indenture,
or to make any change that does not adversely affect the rights of any
Securityholder.
15. DEFAULTS AND REMEDIES
Under the Indenture, Events of Default include (i) default for
30 days in payment of interest on the Securities; (ii) default in payment of
principal on the
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10
Securities at maturity, upon redemption pursuant to paragraph 5 of the
Securities, upon acceleration or otherwise, or failure by the Company to redeem
or purchase Securities when required; (iii) failure by the Company to comply
with other agreements in the Indenture or the Securities, in certain cases
subject to notice and lapse of time; (iv) certain accelerations (including
failure to pay within any grace period after final maturity) of other
Indebtedness of the Company if the amount accelerated (or so unpaid) exceeds
$10.0 million; (v) certain events of bankruptcy or insolvency with respect to
the Company and the Significant Subsidiaries; (vi) certain judgments or decrees
for the payment of money in excess of $10.0 million; and (vii) certain events
with respect to the guarantees of the Securities by the Parent and certain
Restricted Subsidiaries of the Company. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the Securities may declare all the Securities to be due and payable immediately,
subject to certain conditions. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Securities being due and payable
immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
Default (except a Default in payment of principal or interest) if it determines
that withholding notice is in the interest of the Holders.
16. TRUSTEE DEALINGS WITH THE COMPANY
Subject to certain limitations imposed by the Act, the Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were
not Trustee.
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17. NO RECOURSE AGAINST OTHERS
A director, officer, employee or stockholder, as such, of the
Company or the Trustee shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder waives and releases all such liability. The waiver
and release are part of the consideration for the issue of the Securities.
18. AUTHENTICATION
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
19. ABBREVIATIONS
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TENENT
(=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
20. HOLDERS' COMPLIANCE WITH REGISTRATION RIGHTS AGREEMENT.
Each Holder of a Security, by acceptance hereof, acknowledges
and agrees to the provisions of the Registration Rights Agreement, including,
without limitation, the obligations of the Holders with respect to a
registration and the indemnification of the Company to the
extent provided therein.
21. GOVERNING LAW.
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN
REQUEST AND WITHOUT CHARGE TO THE
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12
SECURITYHOLDER A COPY OF THE INDENTURE WHICH HAS IN IT THE TEXT OF THIS SECURITY
IN LARGER TYPE. REQUESTS MAY BE MADE TO:
XXXXXXXXX SEMICONDUCTOR CORPORATION
000 XXXXXXX XXXXXX
XXXXX XXXXXXXX, XX 00000
ATTENTION: GENERAL COUNSEL
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-------------------------------------------------------------------------------
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this
Security on the books of the Company. The agent may substitute another to
act for him.
-------------------------------------------------------------------------------
Date: Your Signature:
---------------------- -----------------------------------
-------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act after the later of the date of original issuance
of such Securities and the last date, if any, on which such Securities were
owned by the Company or any Affiliate of the Company, the undersigned confirms
that such Securities are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) |_| to the Company; or
(2) |_| pursuant to an effective registration
statement under the Securities Act of 1933; or
(3) |_| inside the United States to a "qualified
institutional buyer" (as defined in Rule 144A under the
Securities Act of 1933) that
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purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given
that such transfer is being made in reliance on Rule
144A, in each case pursuant to and in compliance with
Rule 144A under the Securities Act of 1933; or
(4) |_| outside the United States in an offshore transaction
within the meaning of Regulation S under the Securities
Act in compliance with Rule 904 under the Securities
Act of 1933; or
(5) |_| pursuant to another available exemption from
registration provided by Rule 144 under the Securities
Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof; PROVIDED, HOWEVER,
that if box (4) or (5) is checked, the Trustee may require, prior to
registering any such transfer of the Securities, such legal opinions,
certifications and other information as the Company has reasonably
requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption
provided by Rule 144 under such Act.
-----------------------------
Signature
Signature Guarantee:
---------------------------- -----------------------------
Signature must be guaranteed Signature
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-------------------------------------------------------------------------------
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing
this Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Dated:
-------------------------- -------------------------------
NOTICE: To be executed by
an executive officer
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[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security
have been made:
Date of Amount of decrease Amount of increase Principal amount Signature of
Exchange in Principal in Principal of this Global authorized officer
Amount of this Amount of this Security following of Trustee or
Global Security Global Security such decrease or Securities
increase Custodian
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by
the Company pursuant to Section 4.06 or 4.09 of the Indenture,
check the box:
/ /
/ /
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.06 or 4.09 of the Indenture,
state the amount in principal amount: $
Date: Your Signature:
--------------------------- -------------------------------
(Sign exactly as your name
appears on the other side of
this Security.)
Signature Guarantee:
-----------------------------------------------------------
(Signature must be guaranteed)
134
EXHIBIT A
[FORM OF FACE OF EXCHANGE SECURITY
OR PRIVATE EXCHANGE SECURITY]
[*/]
[**/]
No. _______ $__________
10-3/8% Senior Subordinated Notes Due 2007
Xxxxxxxxx Semiconductor Corporation, a Delaware corporation, promises
to pay to CEDE & CO., or registered assigns, the principal sum of _________
Dollars on October 1, 2007.
Interest Payment Dates: April 1 and October 1
Record Dates: March 15 and September 15
----------------
*/ If the Security is to be issued in global form add the Global Securities
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
captioned "[TO BE ATTACHED TO GLOBAL SECURITIES] - SCHEDULE OF INCREASES
OR DECREASES IN GLOBAL SECURITY".
**/ If the Security is a Private Exchange Security issued in a Private Exchange
to an Initial Purchaser holding an unsold portion of its initial allotment,
add the Restricted Securities Legend from Exhibit 1 to Appendix A and
replace the Assignment Form included in this Exhibit A with the Assignment
Form included in such Exhibit 1.
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Additional provisions of this Security are set forth on the other side
of this Security.
Dated: April 7, 1999
XXXXXXXXX SEMICONDUCTOR
CORPORATION,
by
---------------------------------------
Name:
Title:
by
---------------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
UNITED STATES TRUST COMPANY OF NEW YORK,
as Trustee, certifies that
this is one of the Securities
referred to in the Indenture.
by
--------------------------------
Authorized Signatory
136
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY OR PRIVATE EXCHANGE
SECURITY]
10-3/8% Senior Subordinated Note Due October 1, 2007
1. INTEREST
Xxxxxxxxx Semiconductor Corporation, a Delaware corporation
(such corporation, and its successors and assigns under the Indenture
hereinafter referred to, being herein called the "Company"), promises to pay
interest on the principal amount of this Security at the rate per annum shown
above [; PROVIDED, HOWEVER, that if a Registration Default (as defined in the
Registration Rights Agreement) occurs, additional interest will accrue on this
Security at a rate of 0.50% per annum, increasing by 0.50% per annum on the 90th
day after such Registration Default and on every 90th day thereafter during the
continuation of any such Registration Default, from and including the date on
which any such Registration Default shall occur to but excluding the date on
which all such Registration Defaults have been cured]***/. The Company will pay
interest semiannually on April 1 and October 1 of each year. Interest on the
Securities will accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from [April 7, 1999] [date of issuance of any
Additional Securities]. Interest will be computed on the basis of a 360-day year
of twelve 30-day months. The Company shall pay interest on overdue principal at
the rate borne by the Securities plus 1% per annum, and it shall pay interest on
overdue installments of interest at the same rate to the extent lawful.
2. METHOD OF PAYMENT
The Company will pay interest on the Securities (except
defaulted interest) to the Persons who are registered holders of Securities at
the close of business on
---------------------
***/ Insert if at the time of issuance of the Exchange Security or Private
Exchange Security (as the case may be) neither the Registered Exchange Offer has
been consummated nor a Shelf Registration Statement has been declared effective
in accordance with the Registration Rights Agreement.
4
137
March 15 or September 15 next preceding the interest payment date even if
Securities are canceled after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. Payments in respect of Securities (including principal,
premium and interest) will be made by wire transfer of immediately available
funds to the accounts specified by the holders thereof or, if no U.S. dollar
account maintained by the payee with a bank in the United States is designated
by any holder to the Trustee or the Paying Agent at least 30 days prior to the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion), by mailing a check to the registered address of such holder.
3. PAYING AGENT AND REGISTRAR
Initially, United States Trust Company of New York, a New York
banking corporation ("Trustee"), will act as Paying Agent and Registrar. The
Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
4. INDENTURE
The Company issued the Securities under an Indenture dated as
of April 7, 1999 ("Indenture"), among the Company, FSC Semiconductor
Corporation, Xxxxxxxxx Semiconductor Corporation of California and the Trustee.
The terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
Sections 77aaa-77bbbb) as in effect on the date of the Indenture (the "Act").
Terms defined in the Indenture and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms. The Company's obligations under the Securities are guaranteed by
the Parent and certain Restricted Subsidiaries of the Company.
The Securities are general unsecured obligations of the
Company. The Company shall be entitled, subject to its compliance with Section
4.03 of the Indenture, to issue
5
138
Additional Securities pursuant to Section 2.13 of the Indenture. The Initial
Securities issued on the Issue Date, any Additional Securities and all Exchange
Securities or Private Exchange Securities issued in exchange therefor will be
treated as a single class for all purposes under the Indenture. The Indenture
limits, among other things (i) the incurrence of additional debt by the Company
and its subsidiaries, (ii) the payment of dividends on capital stock of the
Company and the purchase, redemption or retirement of capital stock or
subordinated indebtedness, (iii) certain transactions with affiliates, (iv)
sales of assets, including capital stock of subsidiaries, and (v) certain
consolidations, mergers and transfers of assets. The Indenture also prohibits
certain restrictions on distributions from subsidiaries. All of these
limitations and prohibitions, however, are subject to a number of important
qualifications contained in the Indenture.
5. OPTIONAL REDEMPTION
Except as set forth in the next paragraph, the Securities may
not be redeemed prior to April 1, 2003. On and after that date, the Company may
redeem the Securities in whole at any time or in part from time to time at the
following redemption prices (expressed in percentages of principal amount), plus
accrued interest to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the related
interest payment date):
if redeemed during the 12-month period beginning April 1,
PERIOD PERCENTAGE
------ ----------
2003......................................................105.188%
2004......................................................103.458
2005......................................................101.729
2006 and thereafter.......................................100.000
In addition, at any time prior to April 1, 2002, the Company
may redeem up to 35% of the aggregate principal amount of Securities (which
includes Additional Securities, if any,) with the proceeds of a Public Equity
Offering, at any time or from time to time, at a redemption price of 110.375% of
the principal amount thereof, plus accrued interest to redemption date (subject
to the right of Holders of record on the relevant record date to receive
interest
6
139
due on the related interest payment date); PROVIDED, HOWEVER, that:
(1) at least 65% of such aggregate principal amount of
Securities (which includes Additional Securities, if any) remains
outstanding immediately after the occurrence of each such redemption
(other than the Securities held, directly or indirectly, by the Company
or its Affiliates); and
(2) each such redemption occurs within 90 days after the date
of the related Public Equity Offering.
6. SPECIAL REDEMPTION
In the event that (1) the Acquisition of the Power Device
Business is not consummated or (2) Samsung Electronics Co., Ltd. has not
received in cash the full purchase price for the Acquisition, in each case on or
prior to April 23, 1999, the Company shall redeem the Securities (the "Special
Redemption") at a redemption price of 100% of the aggregate principal amount
thereof, plus accrued and unpaid interest thereon (subject to the right of
holders of record on the relevant date to receive interest due on such date) to
the date of redemption. The Company shall prepare and deliver to the Trustee the
notice of the Special Redemption on or prior to the Business Day immediately
preceding, and the Trustee will send by first class mail a copy of such notice
to the Holders of Securities on or prior to, April 26, 1999. The Company shall
redeem the Securities on or prior to May 3, 1999 or, in the event that the
Company does not have sufficient cash to redeem the Securities as a result of
any restriction imposed by Korean law, the Company shall redeem the Securities
on the earlier of (1) the fifth Business Day immediately following the date such
restriction is no longer applicable and (2) July 1, 1999.
7. NOTICE OF REDEMPTION
Except as set forth in paragraph 6 above, notice of optional
redemption will be mailed at least 30 days but not more than 60 days before the
redemption date to each Holder of Securities to be redeemed at his registered
address. Securities in denominations larger than $1,000 may be redeemed in part
but only in whole multiples of $1,000. If money sufficient to pay the redemption
price of and accrued interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the
7
140
Paying Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Securities
(or such portions thereof) called for redemption.
8. PUT PROVISIONS
Upon a Change of Control, any Holder of Securities will have
the right, subject to certain conditions, to cause the Company to repurchase all
or any part of the Securities of such Holder at a repurchase price equal to 101%
of the principal amount of the Securities to be repurchased plus accrued
interest to the date of repurchase (subject to the right of holders of record on
the relevant record date to receive interest due on the related interest payment
date) as provided in, and subject to the terms of, the Indenture.
9. SUBORDINATION
The Securities are subordinated to Senior Indebtedness, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Securities may be paid. The Company agrees,
and each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give it
effect and appoints the Trustee as attorney-in-fact for such purpose.
10. DENOMINATIONS; TRANSFER; EXCHANGE
The Securities are in registered form without coupons in
denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any
Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be
redeemed or 15 days before an interest payment date.
11. PERSONS DEEMED OWNERS
The registered Holder of this Security may be treated as the
owner of it for all purposes.
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12. UNCLAIMED MONEY
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
13. DISCHARGE AND DEFEASANCE
Subject to certain conditions, the Company at any time may
terminate some or all of its obligations under the Securities and the Indenture
if the Company deposits with the Trustee money or U.S. Government Obligations
for the payment of principal and interest on the Securities to redemption or
maturity, as the case may be.
14. AMENDMENT, WAIVER
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount outstanding of the Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount outstanding of
the Securities. Subject to certain exceptions set forth in the Indenture,
without the consent of any Securityholder, the Company and the Trustee may amend
the Indenture or the Securities to cure any ambiguity, omission, defect or
inconsistency, or to comply with Article 5 of the Indenture, or to provide for
uncertificated Securities in addition to or in place of certificated Securities,
or to add guarantees with respect to the Securities or to secure the Securities,
or to add additional covenants or surrender rights and powers conferred on the
Company, or to comply with any request of the SEC in connection with qualifying
the Indenture under the Act, or to make certain changes in the subordination
provisions, or to release a Subsidiary Guaranty when permitted by the Indenture,
or to make any change that does not adversely affect the rights of any
Securityholder.
15. DEFAULTS AND REMEDIES
Under the Indenture, Events of Default include (i) default for
30 days in payment of interest on the Securities; (ii) default in payment of
principal on the
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Securities at maturity, upon redemption pursuant to paragraph 5 of the
Securities, upon acceleration or otherwise, or failure by the Company to redeem
or purchase Securities when required; (iii) failure by the Company to comply
with other agreements in the Indenture or the Securities, in certain cases
subject to notice and lapse of time; (iv) certain accelerations (including
failure to pay within any grace period after final maturity) of other
Indebtedness of the Company if the amount accelerated (or so unpaid) exceeds
$10.0 million; (v) certain events of bankruptcy or insolvency with respect to
the Company and the Significant Subsidiaries; (vi) certain judgments or decrees
for the payment of money in excess of $10.0 million; and (vii) certain events
with respect to the guarantees of the Securities by the Parent and certain
Restricted Subsidiaries of the Company. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the Securities may declare all the Securities to be due and payable immediately,
subject to certain conditions. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Securities being due and payable
immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives reasonable indemnity
or security. Subject to certain limitations, Holders of a majority in principal
amount of the Securities may direct the Trustee in its exercise of any trust or
power. The Trustee may withhold from Securityholders notice of any continuing
Default (except a Default in payment of principal or interest) if it determines
that withholding notice is in the interest of the Holders.
16. TRUSTEE DEALINGS WITH THE COMPANY
Subject to certain limitations imposed by the Act, the Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were
not Trustee.
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17. NO RECOURSE AGAINST OTHERS
A director, officer, employee or stockholder, as such, of the
Company or the Trustee shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Securityholder waives and releases all such liability. The waiver
and release are part of the consideration for the issue of the Securities.
18. AUTHENTICATION
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
19. ABBREVIATIONS
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
20. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures the Company has caused CUSIP numbers
to be printed on the Securities and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
21. HOLDERS' COMPLIANCE WITH REGISTRATION RIGHTS AGREEMENT.
Each Holder of a Security, by acceptance hereof, acknowledges
and agrees to the provisions of the Registration Rights Agreement, including,
without limitation, the obligations of the Holders with respect to a
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registration and the indemnification of the Company to the extent provided
therein.
22. GOVERNING LAW.
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN
REQUEST AND WITHOUT CHARGE TO THE SECURITYHOLDER A COPY OF THE INDENTURE WHICH
HAS IN IT THE TEXT OF THIS SECURITY IN LARGER TYPE. REQUESTS MAY BE MADE TO:
XXXXXXXXX SEMICONDUCTOR CORPORATION
000 XXXXXXX XXXXXX
XXXXX XXXXXXXX, XX 00000
ATTENTION: GENERAL COUNSEL
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--------------------------------------------------------------------------------
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this
Security on the books of the Company. The agent may substitute another to act
for him.
--------------------------------------------------------------------------------
Date: Your Signature:
--------------------- -------------------------------------
---------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
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OPTION OF HOLDER TO ELECT PURCHASE
IF YOU WANT TO ELECT TO HAVE THIS SECURITY PURCHASED BY THE
COMPANY PURSUANT TO SECTION 4.06 OR 4.09 OF THE INDENTURE, CHECK THE BOX:
/ /
IF YOU WANT TO ELECT TO HAVE ONLY PART OF THIS SECURITY
PURCHASED BY THE COMPANY PURSUANT TO SECTION 4.06 OR 4.09 OF THE INDENTURE,
STATE THE AMOUNT: $
DATE: YOUR SIGNATURE:
------------------------------- ---------------------------
(SIGN EXACTLY AS YOUR NAME APPEARS ON
THE OTHER SIDE OF THE SECURITY)
SIGNATURE GUARANTEE:
-----------------------------------------------------------
(SIGNATURE MUST BE GUARANTEED BY A
MEMBER FIRM OF THE NEW YORK STOCK
EXCHANGE OR A COMMERCIAL BANK OR TRUST
COMPANY)
