1
EXHIBIT 4.1
================================================================================
INDENTURE
Dated as of August 15, 1997
Among
SC INTERNATIONAL SERVICES, INC., as Issuer,
SKY CHEFS, INC., CATERAIR INTERNATIONAL, INC. (II),
CATERAIR INTERNATIONAL CORPORATION and
the Additional Guarantors named herein,
as Guarantors,
and
THE BANK OF NEW YORK, as Trustee
$300,000,000
9 1/4% Senior Subordinated Notes due 2007, Series A
and
9 1/4% Senior Subordinated Notes due 2007, Series B
================================================================================
2
[CROSS-REFERENCE TABLE]
TIA Indenture
Section Section
310 (a)(1)......................................... 7.10
(a)(2)......................................... 7.10
(a)(3)......................................... N.A.
(a)(4)......................................... N.A.
(a)(5)......................................... N.A.
(b)............................................ 7.08; 7.10; 13.02
(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)............................................ 7.06; 13.02
(d)............................................ 7.06
314 (a)............................................ 4.06; 4.08; 13.02
(b)............................................ N.A.
(c)(1)......................................... 13.04
(c)(2)......................................... 13.04
(c)(3)......................................... N.A.
(d)............................................ N.A.
(e)............................................ 13.05
(f)............................................ N.A
315 (a)............................................ 7.01(b)
(b)............................................ 7.05; 13.02
(c)............................................ 7.01(a)
(d)............................................ 7.01(c)
(e)............................................ 6.11
316 (a)(last sentence)............................. 2.09
(a)(1)(A)...................................... 6.05
(a)(1)(B)...................................... 6.04
(a)(2)......................................... N.A.
(b)............................................ 6.07
317 (a)(1)......................................... 6.08
(a)(2)......................................... 6.09
(b)............................................ 2.04
318 (a)............................................ 13.01
(c)............................................ 13.01
--------------------
N.A means Not Applicable
3
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of the Indenture.
4
TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.............................................2
SECTION 1.02. Incorporation by Reference of TIA......................33
SECTION 1.03. Rules of Construction..................................33
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating........................................34
SECTION 2.02. Execution and Authentication...........................35
SECTION 2.03. Registrar and Paying Agent.............................37
SECTION 2.04. Paying Agent To Hold Assets in Trust...................37
SECTION 2.05. Holder Lists...........................................38
SECTION 2.06. Transfer and Exchange..................................38
SECTION 2.07. Replacement Notes......................................39
SECTION 2.08. Outstanding Notes......................................39
SECTION 2.09. Treasury Notes.........................................40
SECTION 2.10. Temporary Notes........................................40
SECTION 2.11. Cancellation...........................................40
SECTION 2.12. Defaulted Interest.....................................41
SECTION 2.13. CUSIP Number...........................................41
SECTION 2.14. Deposit of Moneys......................................41
SECTION 2.15. Restrictive Legends....................................41
SECTION 2.16. Book-Entry Provisions for Global Note..................44
SECTION 2.17. Special Transfer Provisions............................45
SECTION 2.18. Additional Interest Under Registration
Rights Agreement....................................48
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.....................................49
SECTION 3.02. Selection of Notes To Be Redeemed......................49
SECTION 3.03. Notice of Redemption...................................49
SECTION 3.04. Effect of Notice of Redemption.........................50
SECTION 3.05. Deposit of Redemption Price............................51
SECTION 3.06. Notes Redeemed in Part.................................51
-i-
5
Page
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes.......................................51
SECTION 4.02. Maintenance of Office or Agency........................51
SECTION 4.03. Corporate Existence....................................52
SECTION 4.04. Payment of Taxes and Other Claims......................52
SECTION 4.05. Maintenance of Properties and Insurance................53
SECTION 4.06. Compliance Certificate; Notice of Default..............53
SECTION 4.07. Compliance with Laws...................................55
SECTION 4.08. Reports................................................55
SECTION 4.09. Waiver of Stay, Extension or Usury Laws................56
SECTION 4.10. Limitation on Restricted Payments......................56
SECTION 4.11. Limitation on Transactions with Affiliates.............60
SECTION 4.12. Limitation on Incurrence of Additional
Indebtedness........................................61
SECTION 4.13. Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries.................62
SECTION 4.14. Prohibition on Incurrence of Senior
Subordinated Debt...................................64
SECTION 4.15. Change of Control......................................64
SECTION 4.16. Limitation on Asset Sales..............................66
SECTION 4.17. Limitation on Preferred Stock of
Subsidiaries........................................72
SECTION 4.18. Limitation on Liens....................................72
SECTION 4.19. Guarantees of Certain Indebtedness.....................73
SECTION 4.20. Conduct of Business of the Issuer and Its
Restricted Subsidiaries.............................74
SECTION 4.21. Conduct of Business of Caterair........................74
SECTION 4.22. Guarantor Capital Stock................................74
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. When Issuer May Merge, etc.............................75
SECTION 5.02. Successor Corporation Substituted......................76
-ii-
6
Page
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default......................................76
SECTION 6.02. Acceleration...........................................78
SECTION 6.03. Other Remedies.........................................79
SECTION 6.04. Waiver of Past Defaults................................80
SECTION 6.05. Control by Majority....................................80
SECTION 6.06. Limitation on Suits....................................80
SECTION 6.07. Rights of Holders To Receive Payment...................81
SECTION 6.08. Collection Suit by Trustee.............................81
SECTION 6.09. Trustee May File Proofs of Claim.......................81
SECTION 6.10. Priorities.............................................82
SECTION 6.11. Undertaking for Costs..................................82
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee......................................83
SECTION 7.02. Rights of Trustee......................................84
SECTION 7.03. Individual Rights of Trustee...........................86
SECTION 7.04. Trustee's Disclaimer...................................86
SECTION 7.05. Notice of Default......................................86
SECTION 7.06. Reports by Trustee to Holders..........................86
SECTION 7.07. Compensation and Indemnity.............................87
SECTION 7.08. Replacement of Trustee.................................88
SECTION 7.09. Successor Trustee by Merger, etc.......................89
SECTION 7.10. Eligibility; Disqualification..........................89
SECTION 7.11. Preferential Collection of Claims Against
the Issuer..........................................90
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of the Issuer's Obligations................90
SECTION 8.02. Acknowledgment of Discharge by Trustee.................92
SECTION 8.03. Application of Trust Money.............................92
SECTION 8.04. Repayment to the Issuer................................92
SECTION 8.05. Reinstatement..........................................93
-iii-
7
Page
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.............................93
SECTION 9.02. With Consent of Holders................................94
SECTION 9.03. Compliance with TIA....................................96
SECTION 9.04. Revocation and Effect of Consents......................96
SECTION 9.05. Notation on or Exchange of Notes.......................97
SECTION 9.06. Trustee To Sign Amendments, etc........................97
ARTICLE TEN
SUBORDINATION OF NOTES
SECTION 10.01. Notes Subordinated to Senior Debt......................97
SECTION 10.02. No Payment on Notes in Certain Circumstances...........98
SECTION 10.03. Payment Over of Proceeds upon Dissolution,
etc.................................................99
SECTION 10.04. Payments May Be Paid Prior to Dissolution.............101
SECTION 10.05. Subrogation...........................................101
SECTION 10.06. Obligations of the Issuer Unconditional...............102
SECTION 10.07. Notice to Trustee.....................................102
SECTION 10.08. Reliance on Judicial Order or Certificate of
Liquidating Agent..................................103
SECTION 10.09. Trustee's Relation to Senior Debt.....................104
SECTION 10.10. Subordination Rights Not Impaired by Acts or
Omissions of the Issuer or Holders of
Senior Debt........................................104
SECTION 10.11. Holders Authorize Trustee To Effectuate
Subordination of Notes.............................105
SECTION 10.12. This Article Ten Not To Prevent Events of
Default............................................106
ARTICLE ELEVEN
GUARANTEES OF THE NOTES
SECTION 11.01. Guarantees............................................106
SECTION 11.02. Execution and Delivery of the Guarantees..............108
SECTION 11.03. Additional Guarantors.................................109
SECTION 11.04. Limitation of Guarantors' Liability...................109
-iv-
8
Page
SECTION 11.05. Guarantors May Consolidate, etc., on Certain
Terms; Release from Guarantee......................110
SECTION 11.06. Contribution..........................................111
SECTION 11.07. Waiver of Subrogation.................................111
ARTICLE TWELVE
SUBORDINATION OF GUARANTEES
SECTION 12.01. Guarantee Obligations Subordinated to
Guarantor Senior Debt..............................112
SECTION 12.02. No Payment on Guarantees in Certain
Circumstances......................................112
SECTION 12.03. Payment Over of Proceeds upon Dissolution,
etc................................................114
SECTION 12.04. Payments May Be Paid Prior to Dissolution.............116
SECTION 12.05. Subrogation...........................................116
SECTION 12.06. Guarantee Provisions Solely To Define
Relative Rights....................................117
SECTION 12.07. Trustee To Effectuate Subordination of
Obligations Under the Guarantees...................118
SECTION 12.08. No Waiver of Guarantee Subordination
Provisions.........................................118
SECTION 12.09. Guarantors To Give Notice to Trustee..................119
SECTION 12.10. Reliance on Judicial Order or Certificate of
Liquidating Agent Regarding Dissolution,
etc., of Guarantors................................120
SECTION 12.11. No Suspension of Remedies.............................121
SECTION 12.12. Trustee's Relation to Guarantor Senior Debt...........121
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. TIA Controls..........................................122
SECTION 13.02. Notices...............................................122
SECTION 13.03. Communications by Holders with Other Holders..........123
SECTION 13.04. Certificate and Opinion as to Conditions
Precedent..........................................123
SECTION 13.05. Statements Required in Certificate or
Opinion............................................124
-v-
9
Page
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar.............124
SECTION 13.07. Legal Holidays........................................124
SECTION 13.08. Governing Law.........................................124
SECTION 13.09. No Adverse Interpretation of Other
Agreements.........................................125
SECTION 13.10. No Recourse Against Others............................125
SECTION 13.11. Successors............................................125
SECTION 13.12. Duplicate Originals...................................125
SECTION 13.13. Severability..........................................125
Signatures..............................................................126
Exhibit A - Form of Series A Note.......................................A-1
Exhibit B - Form of Series B Note.......................................B-1
Exhibit C - Form of Certificate To Be Delivered in Connection
with Transfers to Non-QIB Accredited Investors...........C-1
Exhibit D - Form of Certificate To Be Delivered in Connection
with Transfers Pursuant to Regulation S..................D-1
Note: This Table of Contents shall not, for any purpose, be deemed to be part
of the Indenture.
-vi-
10
INDENTURE, dated as of August 15, 1997, among SC INTERNATIONAL
SERVICES, INC., a Delaware corporation (the "Issuer"), SKY CHEFS, INC., a
Delaware corporation ("Sky Chefs"), CATERAIR INTERNATIONAL, INC. (II), a
Delaware corporation ("CII"), CATERAIR INTERNATIONAL CORPORATION, a Delaware
corporation ("Caterair"), Caterair International Transition Corporation, a
Delaware corporation, Onex Ohio Acceptance Corporation, a Delaware corporation,
Onex Ohio Finance Corp., a Delaware corporation, Onex Ohio Finance Corp. II, a
Delaware corporation, Onex Ohio Equity Corp., a Delaware corporation, Onex Ohio
Equity Corp. II, a Delaware corporation, Onex Ohio Credit Corp., a Delaware
corporation, Onex Ohio Credit Corp. II, a Delaware corporation, Onex Ohio
Capital Corp., a Delaware corporation, Onex Ohio Capital Corp. II, a Delaware
corporation, Onex Ohio Fiscal Corp., a Delaware corporation, Onex Ohio Fiscal
Corp. II, a Delaware corporation, Onex Ohio Funds Corp., a Delaware corporation,
Onex Ohio Funds Corp. II, a Delaware corporation, Arlington Services, Inc., a
Delaware corporation, Arlington Services Holding Corporation, a Delaware
corporation, Sky Chefs International Corp., a Delaware corporation, Bethesda
Services, Inc, a Delaware corporation, Caterair New Zealand Limited (formerly
known as Bethesda Services Holding Corporation), a Delaware corporation, JFK
Caterers, Inc., a Delaware corporation, Caterair Consulting Services
Corporation, a Delaware corporation, Western Aire Chef, Inc., a Delaware
corporation, Caterair Airport Properties, Inc, a Delaware corporation, Caterair
St. Xxxxxx Holding Corporation, a Delaware corporation, and Sky Chefs Argentine,
Inc., a Delaware corporation (each of the foregoing a "Guarantor"), and THE BANK
OF NEW YORK, a New York banking corporation, as trustee (the "Trustee").
The Issuer has duly authorized the creation of an issue of 9 1/4%
Senior Subordinated Notes due 2007, Series A (the "Initial Notes") and 9 1/4%
Senior Subordinated Notes due 2007, Series B to be issued in exchange for the
Initial Notes pursuant to the Registration Rights Agreement (as defined herein)
(the "Exchange Notes" and, together with the Private Exchange Notes (as defined
herein) and the Initial Notes, the "Notes") and, to provide therefor, the Issuer
has duly authorized the execution and delivery of this Indenture. The Notes will
be guaranteed on a senior subordinated basis by the Guarantors. All things
necessary to make the Notes, when duly issued and executed by the Issuer, and
authenticated and delivered hereunder, the valid obligations of the Issuer, and
to make this Indenture a valid and binding agreement of the Issuer, have been
done.
11
-2-
Each party hereto agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the holders of the Notes.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acceleration Notice" has the meaning provided in Section 6.02.
"Acquired Indebtedness" means Indebtedness of a Person or any of its
Subsidiaries existing at the time such Person becomes a Restricted Subsidiary of
the Issuer or a Subsidiary of Caterair, as the case may be, or at the time it
merges or consolidates with the Issuer or any Subsidiary of the Issuer or
Caterair or any Subsidiary of Caterair, as the case may be, or assumed in
connection with the acquisition of assets from such Person and not incurred by
such Person in connection with, or in anticipation or contemplation of, such
Person becoming a Restricted Subsidiary of the Issuer or a Subsidiary of
Caterair, as the case may be, or such acquisition, merger or consolidation.
"Adjusted Net Assets" of a Guarantor at any date means the lesser of
the amount by which (x) the fair value of the property of such Guarantor exceeds
the total amount of liabilities, including, without limitation, contingent
liabilities (after giving effect to all other fixed and contingent liabilities
incurred or assumed on such date), but excluding liabilities under its
Guarantee, of such Guarantor at such date and (y) the present fair salable value
of the assets of such Guarantor at such date exceeds the amount that will be
required to pay the probable liability of such Guarantor on its debts (after
giving effect to all other fixed and contingent liabilities incurred or assumed
on such date and after giving effect to any collection from any Subsidiary of
such Guarantor in respect of the obligations of such Subsidiary under the
Guarantee of such Guarantor), excluding Subordinated Indebtedness and debt in
respect of its Guarantee as they become absolute and matured.
"Affiliate" means a Person who directly or indirectly through one or
more intermediaries controls, or is controlled
12
-3-
by, or is under common control with, another Person. The term "control" means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Affiliate Transaction" has the meaning provided in Section 4.11.
"Agent" means any Registrar, Paying Agent or Co-Registrar.
"Agent Members" has the meaning provided in Section 2.16.
"Airline Catering Joint Venture" means any joint venture, partnership,
limited liability company or other Person engaged in the business of providing
airline catering services.
"Asset Acquisition" means (a) an Investment by the Issuer or any
Restricted Subsidiary of the Issuer in any other Person pursuant to which such
Person shall become a Restricted Subsidiary of the Issuer or a Subsidiary of any
Restricted Subsidiary of the Issuer, or shall be merged with or into the Issuer
or any Restricted Subsidiary of the Issuer, or (b) the acquisition by the Issuer
or any Restricted Subsidiary of the Issuer of the assets of any Person which
constitute all or substantially all of the assets of such Person, any division
or line of business of such Person or any other properties or assets of such
Person other than in the ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
transfer, lease (other than pursuant to operating leases of real or personal
property entered into in the ordinary course of business), assignment or other
transfer for value by the Issuer or any Restricted Subsidiary of the Issuer
(including any Sale and Leaseback Transaction) to any Person other than the
Issuer or a Restricted Subsidiary of the Issuer of (a) any Capital Stock of any
Restricted Subsidiary of the Issuer or (b) any other property or assets of the
Issuer or any Restricted Subsidiary of the Issuer other than in the ordinary
course of business; provided, however, that an Asset Sale shall not include (i)
a transaction or series of related transactions for which the Issuer or its
Restricted Subsidiaries receive aggregate consideration of less than $1 million,
(ii) the sale or discount, in each case without recourse (other than recourse
for breach of a representation or warranty), of accounts re-
13
-4-
ceivable arising in the ordinary course of business, but only in connection with
the compromise or collection thereof, (iii) the factoring or securitization of
accounts receivable arising in the ordinary course of business, (iv) the sale,
lease, conveyance, disposition or other transfer of all or substantially all of
the assets of the Issuer as permitted under Section 5.01 and (v) the sale or
other disposition in the ordinary course of business of equipment or materials
which, in the reasonable judgment of such Person, are obsolete, worn out or
otherwise no longer useful in the conduct of such Person's business.
"Australian Assets" means any of the shares of Caterair Airport
Services Pty Limited owned by Caterair Australia Pty Limited which Qantas Flight
Catering Holdings Limited has the option to acquire pursuant to the exercise of
the call options respectively described in clauses 19A, 19B and 19C of the
Restated Shareholders Deed made on December 18, 1996 among Caterair Airport
Services Pty Limited, Caterair Australia Pty Limited, CII, OFSI, Qantas Airways
Limited and Qantas Flight Catering Holdings Limited.
"Authenticating Agent" has the meaning provided in Section 2.02.
"Authorized Officer" means, with respect to any Person, each of the
Chairman of the Board, the Chief Executive Officer, the President, the Chief
Financial Officer, the Treasurer or the Secretary of such Person, or any other
officer designated as an Authorized Officer by the Board of Directors in a
writing delivered to the Trustee.
"Bankruptcy Law" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"Blockage Period" has the meaning provided in Section 10.02.
"Board of Directors" means, as to any Person, the board of directors of
such Person or any duly authorized committee thereof.
"Board Resolution" means, with respect to any Person, a duly adopted
resolution of the Board of Directors of such Person.
14
-5-
"Business Day" means a day that is not a Legal Holiday.
"Capitalized Lease Obligation" means, as to any Person, the obligations
of such Person under a lease that are required for financial reporting purposes
to be classified and accounted for as capital lease obligations under GAAP and,
for purposes of this definition, the amount of such obligations at any date
shall be the capitalized amount of such obligations at such date, determined in
accordance with GAAP.
"Capital Stock" means (i) with respect to any Person that is a
corporation, any and all shares, interests, participations or other equivalents
(however designated) of corporate stock, including each class of common stock
and Preferred Stock of such Person and (ii) with respect to any Person that is
not a corporation, any and all partnership or other equity interests of such
Person.
"Cash Equivalents" means (i) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either Standard & Poor's Corporation or Xxxxx'x Investors
Service, Inc.; (iii) commercial paper maturing no more than one year from the
date of creation thereof and, at the time of acquisition, having a rating of at
least A-1 from Standard & Poor's Corporation or at least P-1 from Xxxxx'x
Investors Service, Inc.; (iv) time deposits, certificates of deposit or bankers'
acceptances (or, with respect to foreign banks, similar instruments) maturing
within one year from the date of acquisition thereof issued by any bank
organized under the laws of the United States of America or any state thereof or
the District of Columbia or any U.S. branch of a foreign bank having at the date
of acquisition thereof combined capital and surplus of not less than $200
million; provided that instruments issued by banks not having one of the two
highest ratings obtainable from either Standard & Poor's Corporation or Xxxxx'x
Investors Services, Inc. shall not constitute "Cash Equivalents" for purposes of
the subordination provisions of this Indenture; (v) repurchase obligations with
a term of not more than seven days for underlying securities of the types
de-
15
-6-
scribed in clause (i) above entered into with any bank meeting the
qualifications specified in clause (iv) above; (vi) except for purposes of the
subordination provisions of this Indenture, investments in money market funds
substantially all of whose assets are comprised of securities of the types
described in clauses (i) through (v) above; and (vii) overnight deposits and
demand deposits maintained in the ordinary course of business.
"Caterair" has the meaning provided in the preamble.
"Caterair Asset Sale" means any direct or indirect sale, issuance,
conveyance, transfer, lease (other than pursuant to operating leases of real or
personal property entered into in the ordinary course of business), assignment
or other transfer for value by Caterair or any Subsidiary of Caterair (including
any Sale and Leaseback Transaction) to any Person other than Caterair or a
Wholly Owned Subsidiary of Caterair of (a) any Capital Stock of any Subsidiary
of Caterair or (b) any other property or assets of Caterair or any Subsidiary of
Caterair other than in the ordinary course of business; provided, however, that
Caterair Asset Sale shall not include (i) a transaction or series of related
transactions for which Caterair or its Subsidiaries receive aggregate
consideration of less than $1 million, (ii) the sale or discount, in each case
without recourse (other than recourse for breach of a representation or
warranty), of accounts receivable arising in the ordinary course of business,
but only in connection with the compromise or collection thereof, (iii) the
factoring or securitization of accounts receivable arising in the ordinary
course of business, (iv) the sale or other disposition in the ordinary course of
business of equipment or materials which, in the reasonable judgment of such
Person, are obsolete, worn out or otherwise no longer useful in the conduct of
such Person's business and (v) the sale of assets to the Issuer or any
Restricted Subsidiary of the Issuer in connection with the exercise of the
purchase options for the Caterair Leased Property pursuant to the Caterair Lease
and the Caterair Licensed Property pursuant to the Caterair License.
"Caterair Holdings" means Caterair Holdings Corporation, a Delaware
corporation.
"Caterair Lease" means collectively the lease and sublease agreements
pursuant to which the Caterair Leased Property is leased to the Issuer or
Subsidiaries of the Issuer.
"Caterair Leased Property" means (i) the property and assets listed on
Schedule 2.2(k) to the Master Agreement and
16
-7-
(ii) all other property and assets acquired by Caterair and substantially
contemporaneously with such acquisition leased by Caterair to the Issuer or
Subsidiaries of the Issuer.
"Caterair License" means, collectively, the license agreements pursuant
to which the Caterair Licensed Property is licensed to the Issuer or
Subsidiaries of the Issuer.
"Caterair Licensed Property" means (i) the property and assets listed
on Schedule 2.2(o) to the Master Agreement and (ii) all other property and
assets acquired by Caterair and substantially contemporaneously with such
acquisition licensed by Caterair to the Issuer or Subsidiaries of the Issuer.
"Caterair Net Proceeds Offer" has the meaning provided in Section 4.15.
"Caterair Net Proceeds Offer Amount" has the meaning provided in
Section 4.15.
"Caterair Net Proceeds Offer Trigger Date" has the meaning provided in
Section 4.15.
"Caterair Promissory Note" means the 8% Pay-in-Kind Promissory Note due
2001 of Caterair.
"Caterair Restricted Payment" has the meaning provided in Section 4.10.
"Caterair Tax Sharing Agreement" means the Income Tax Sharing Agreement
dated December 15, 1989, among Marriott Corporation, Caterair Holdings and
Caterair.
"Certificated Securities" means Notes in definitive registered form.
"Change of Control" means the occurrence of one or more of the
following events: (i) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all of
the assets of the Issuer or OFSI, as the case may be, to any Person or group of
related Persons for purposes of Section 13(d) of the Exchange Act (a "Group")
(whether or not otherwise in compliance with the provisions of this Indenture),
other than a Permitted Holder or Holders; or (ii) if the Permitted Holders do
not own, directly or indirectly, beneficially (as defined in Rules 13d-3 and
13d-5 under the Exchange Act) or of record, shares representing more than 50% of
the aggregate ordinary voting power
17
-8-
represented by the issued and outstanding Capital Stock of the Issuer or OFSI,
as the case may be, (A) any Person or Group, other than a Permitted Holder or
Holders, shall become the owner, directly or indirectly, beneficially (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) or of record, of shares
representing more than 50% of the aggregate ordinary voting power represented by
the issued and outstanding Capital Stock of the Issuer or OFSI, as the case may
be, or (B) the replacement of a majority of the Board of Directors of either the
Issuer or OFSI, as the case may be, over a two-year period from the directors
who constituted the Board of Directors of such Person at the beginning of such
period, and such replacement shall not have been approved by a vote of at least
a majority of the Board of Directors of such Person then still in office who
either were members of the Board of Directors of such Person at the beginning of
such period or whose election as a member of the Board of Directors of such
Person was previously so approved.
"Change of Control Date" has the meaning provided in Section 4.15.
"Change of Control Offer" has the meaning provided in Section 4.15.
"Change of Control Payment Date" has the meaning provided in Section
4.15.
"CII" has the meaning provided in the preamble.
"Consolidated Amortization Expense" means, with respect to any Person
for any period, the consolidated amortization expense of such Person for such
period, determined on a consolidated basis for such Person and its Restricted
Subsidiaries (and, in the case of the Issuer, Caterair and its Subsidiaries) in
conformity with GAAP.
"Consolidated Depreciation Expense" means, with respect to any Person
for any period, the consolidated depreciation expense of such Person for such
period, determined on a consolidated basis for such Person and its Restricted
Subsidiaries (and, in the case of the Issuer, Caterair and its Subsidiaries) in
conformity with GAAP.
"Consolidated EBITDA" means, with respect to any Person for any period,
the sum, without duplication, of (i) Consolidated Net Income, (ii) to the extent
Consolidated Net Income has been reduced thereby, all income taxes of such
18
-9-
Person and its Restricted Subsidiaries (and, in the case of the Issuer, Caterair
and its Subsidiaries) paid or accrued in conformity with GAAP for such period
(other than income taxes attributable to extraordinary or nonrecurring gains or
losses), (iii) Consolidated Interest Expense, (iv) Consolidated Amortization
Expense, (v) Consolidated Depreciation Expense and (vi) Consolidated Non-cash
Charges.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to any
Person, the ratio of Consolidated EBITDA of such Person during the four full
fiscal quarters (the "Four Quarter Period") ending on or prior to the date of
the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio (the "Transaction Date") to Consolidated Fixed Charges of
such Person for the Four Quarter Period. In addition to and without limitation
of the foregoing, for purposes of this definition, "Consolidated EBITDA" and
"Consolidated Fixed Charges" shall be calculated after giving effect on a pro
forma basis for the period of such calculation to (i) the incurrence or
repayment of any Indebtedness (excluding the incurrence of Indebtedness under
any revolving credit facility and including repayment of Indebtedness under any
revolving credit facility only to the extent that such repayment effects a
permanent reduction in the availability thereunder) of such Person or any of its
Restricted Subsidiaries (and, in the case of the Issuer, Caterair and its
Subsidiaries, other than Indebtedness between the Issuer or any Subsidiary of
the Issuer and Caterair or any Subsidiary of Caterair) (and the application of
the proceeds thereof) giving rise to the need to make such calculation and any
incurrence or repayment of other Indebtedness (and the application of the
proceeds thereof) at any time subsequent to the first day of the Four Quarter
Period and on or prior to the Transaction Date, as if such incurrence or
repayment, as the case may be (and the application of the proceeds thereof),
occurred on the first day of the Four Quarter Period and (ii) any Asset Sales or
Asset Acquisitions (including, without limitation, any Asset Acquisition giving
rise to the need to make such calculation as a result of such Person or one of
its Restricted Subsidiaries (including any Person who becomes a Restricted
Subsidiary as a result of the Asset Acquisition) incurring, assuming or
otherwise being liable for Acquired Indebtedness and also including any
Consolidated EBITDA (including any pro forma expense and cost reductions
calculated on a basis consistent with Regulation S-X under the Securities Act)
attributable to the assets which are the subject of the Asset Acquisition or
Asset Sale during the Four Quarter Period) occurring during the Four Quarter
Period or at any time subsequent to the last day of the
19
-10-
Four Quarter Period and on or prior to the Transaction Date, as if such Asset
Sale or Asset Acquisition (including the incurrence, assumption or liability for
any such Indebtedness or Acquired Indebtedness) occurred on the first day of the
Four Quarter Period. If such Person or any of its Restricted Subsidiaries
directly or indirectly guarantees Indebtedness of a third Person, the preceding
sentence shall give effect to the incurrence of such guaranteed Indebtedness as
if such Person or any Restricted Subsidiary of such Person had directly incurred
or otherwise assumed such guaranteed Indebtedness. Furthermore, in calculating
"Consolidated Fixed Charges" for purposes of determining the denominator (but
not the numerator) of this "Consolidated Fixed Charge Coverage Ratio," (1)
interest on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and which will continue to be so determined thereafter shall be
deemed to have accrued at a fixed rate per annum equal to the rate of interest
on such Indebtedness in effect on the Transaction Date; (2) if interest on any
Indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect during the
Four Quarter Period; (3) notwithstanding clause (1) above, interest on
Indebtedness determined on a fluctuating basis, to the extent such interest is
covered by agreements relating to Interest Swap Obligations, shall be deemed to
accrue at the rate per annum (not in excess of the maximum possible rate if such
agreement is an interest rate cap, interest rate collar or similar agreement)
resulting after giving effect to the operation of such agreements; and (4) the
permanent retirement of any Indebtedness during the Four Quarter Period or at
any time subsequent to the last day of the Four Quarter Period and on or prior
to the Transaction Date shall be given effect as if it occurred at the beginning
of such Four Quarter Period.
"Consolidated Fixed Charges" means, with respect to any Person for any
period, the sum, without duplication, of (i) Consolidated Interest Expense
(including amortization or write-off of debt issuance costs), plus (ii) the
product of (x) the amount of all dividend payments on any series of Preferred
Stock of such Person (other than dividends paid in common stock) paid, accrued
or scheduled to be paid or accrued during such period and (y) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current effective consolidated federal, state and local tax rate of such Person
expressed as a decimal.
20
-11-
"Consolidated Interest Expense" means, with respect to any Person for
any period, the sum, without duplication, of (i) the aggregate of all cash and
non-cash interest expense with respect to all outstanding Indebtedness of such
Person and its Restricted Subsidiaries (and, in the case of the Issuer, Caterair
and its Subsidiaries), including the net costs associated with Interest Swap
Obligations and capitalized interest, for such period determined on a
consolidated basis in conformity with GAAP; and (ii) the interest component of
Capitalized Lease Obligations paid, accrued and/or scheduled to be paid or
accrued by such Person and its Restricted Subsidiaries (and, in the case of the
Issuer, Caterair and its Subsidiaries) during such period as determined on a
consolidated basis in accordance with GAAP. In addition, in calculating the
Consolidated Interest Expense of the Issuer, interest expense with respect to
Indebtedness between the Issuer or any Subsidiary of the Issuer and Caterair or
any Subsidiary of Caterair shall be excluded therefrom.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate net income (or loss) of such Person and its Subsidiaries
(and, in the case of the Issuer, Caterair) for such period on a consolidated
basis, determined in accordance with GAAP; provided that there shall be excluded
therefrom (a) gains and losses from Asset Sales (without regard to the $1
million limitation set forth in the definition thereof) and Caterair Asset Sales
(without regard to the $1 million limitation set forth in the definition
thereof) or abandonments or reserves relating thereto and the related tax
effects, (b) items classified as extraordinary or nonrecurring gains and losses,
and the related tax effects according to GAAP, (c) the net income (or loss) of
any Person acquired in a pooling of interests transaction accrued prior to the
date it becomes a Subsidiary of such first Person or is merged or consolidated
with such first Person or any Subsidiary of such first Person, (d) the net
income of any Subsidiary of such Person to the extent that the declaration of
dividends or similar distributions by that Subsidiary of that income is
restricted by contract, operation of law or otherwise, (e) the net loss of any
Person, other than a Restricted Subsidiary of such first Person and (f) the net
income of any Person, other than a Restricted Subsidiary of such first Person,
in which such first Person has an equity interest, except to the extent of cash
dividends or distributions paid to such first Person or a Restricted Subsidiary
of such first Person. Notwithstanding the foregoing, in calculating the
Consolidated Net Income of the Issuer, (i) charges incurred by the Issuer in
connection with the consummation of the transactions contemplated by the Master
21
-12-
Agreement (including, without limitation, (A) severance payments and other
employee costs and (B) external consulting services primarily associated with
the implementation of labor savings programs) shall not be deducted therefrom,
(ii) the goodwill and the increases in amortization and depreciation resulting
from the consummation of the transactions contemplated by the Master Agreement
shall not be deducted therefrom and (iii) interest payments or accruals on the
Caterair Promissory Note shall not be taken into account.
"Consolidated Non-cash Charges" means, with respect to any Person for
any period, the aggregate depreciation, amortization and other non-cash expenses
of such Person and its Restricted Subsidiaries (and, in the case of the Issuer,
Caterair and its Subsidiaries) reducing Consolidated Net Income of such Person
and its Restricted Subsidiaries (and, in the case of the Issuer, Caterair and
its Subsidiaries) for such period, determined on a consolidated basis in
conformity with GAAP (excluding any such charges constituting an extraordinary
item or loss or any such charge which requires an accrual of or a reserve for
cash charges for any future period).
"Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement to which the Issuer or any
Restricted Subsidiary of the Issuer or Caterair or any Subsidiary of Caterair,
as the case may be, is a party designed to protect the Issuer or any Restricted
Subsidiary of the Issuer or Caterair or any Subsidiary of Caterair, as the case
may be, against fluctuations in currency values.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Default" means an event or condition the occurrence of which is, or
with the lapse of time or the giving of notice or both would be, an Event of
Default.
"Default Notice" shall have the meaning provided in Section 10.02.
"Depository" means the DTC.
"Designated Guarantor Senior Debt" means (i) Indebtedness incurred or
guaranteed by a Guarantor under or in respect of the Senior Bank Financing and
(ii) any other Indebtedness constituting Guarantor Senior Debt which, at the
time of
22
-13-
determination, has an aggregate principal amount of at least $10 million and is
specifically designated in the instrument evidencing such Guarantor Senior Debt
as "Designated Guarantor Senior Debt" by the applicable Guarantor.
"Designated Senior Debt" means (i) Indebtedness under or in respect of
the Senior Bank Financing and (ii) any other Indebtedness constituting Senior
Debt which, at the time of determination, has an aggregate principal amount of
at least $10 million and is specifically designated in the instrument evidencing
such Senior Debt as "Designated Senior Debt" by the Issuer.
"Discharged" has the meaning provided in Section 8.01.
"Disqualified Capital Stock" means any Capital Stock which, by its
terms (or by the terms of any security into which it is convertible or for which
it is exchangeable), or upon the happening of any event (other than an event
which would constitute a Change of Control), matures (excluding any maturity as
the result of an optional redemption by the issuer thereof) or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the sole option of the holder thereof (except, in each case, upon the
occurrence of a Change of Control), in whole or in part, on or prior to the
final maturity date of the Notes.
"DTC" means The Depository Trust Company.
"Event of Default" has the meaning provided in Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor statute or statutes thereto.
"Exchange Notes" has the meaning provided in the preamble to this
Indenture.
"Exchange Offer" means the registration by the Issuer and the
Guarantors under the Securities Act pursuant to a registration statement of the
offer by the Issuer and the Guarantors to each Holder of the Initial Notes held
by such Holder for the Exchange Notes in an aggregate principal amount equal to
the aggregate principal amount of the Initial Notes held by such Holder, all in
accordance with the terms and conditions of the Registration Rights Agreement.
23
-14-
"Funding Guarantor" has the meaning provided in Section 11.06.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the date of this Indenture, including,
without limitation, those set forth in the opinions and pronouncements of the
Accounting Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as approved by
a significant segment of the accounting profession.
"Global Note" has the meaning provided in Section 2.01.
"Guarantees" means the guarantees of the Notes on a senior subordinated
basis by the Guarantors pursuant to Article Eleven hereof.
"Guarantor Blockage Period" has the meaning provided in Section 12.02.
"Guarantor Default Notice" has the meaning provided in Section 12.02.
"Guarantor Senior Debt" means the principal of, premium, if any, and
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on, and all other obligations with respect to, any Indebtedness of a Guarantor,
whether outstanding on the Issue Date or thereafter created, incurred or
assumed, unless, in the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same is outstanding
expressly provides that such Indebtedness shall not be senior in right of
payment to the Guarantees. Without limiting the generality of the foregoing,
"Guarantor Senior Debt" shall also include the principal of, premium, if any,
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on, and all other amounts owing in respect of, (x) all monetary obligations of
every nature of a Guarantor under the Senior Bank Financing, including, without
limitation, (a) obligations to pay principal and interest, reimbursement
obligations under letters of credit, fees,
24
-15-
expenses and indemnities and (b) guarantees by a Guarantor of Obligations under
the Senior Bank Financing where the direct borrower is the Issuer or a
Subsidiary of the Issuer, (y) all Interest Swap Obligations and (z) all
obligations under Currency Agreements, in each case whether outstanding on the
Issue Date or thereafter incurred. Notwithstanding the foregoing, Guarantor
Senior Debt shall not include (i) any Indebtedness, if the instrument creating
or evidencing the same or the assumption or guarantee thereof expressly provides
that such Indebtedness shall not be senior in right of payment to the
Guarantees, (ii) any Indebtedness of a Guarantor to a Subsidiary of such
Guarantor, (iii) Indebtedness to, or guaranteed on behalf of, any director,
officer or employee of a Guarantor or any Subsidiary of a Guarantor (including,
without limitation, amounts owed for compensation), (iv) Indebtedness to trade
creditors and other amounts incurred in connection with obtaining goods,
materials or services, (v) Indebtedness represented by Disqualified Capital
Stock, (vi) any liability for federal, state, local or other taxes owed or owing
by a Guarantor, (vii) that portion of any Indebtedness incurred in violation of
the provisions set forth in Section 4.12 (but, as to any such obligation, no
such violation shall be deemed to exist for purposes of this clause (vii) if the
holder(s) of such obligation or their representative and the Trustee shall have
received an Officers' Certificate of the Issuer to the effect that the
incurrence of such Indebtedness does not (or, in the case of revolving credit
Indebtedness, that the incurrence of the entire committed amount thereof at the
date on which the initial borrowing thereunder is made) would not violate such
provisions of this Indenture), and (viii) any Indebtedness which is, by its
express terms, subordinated in right of payment to any other Indebtedness of a
Guarantor.
"Guarantors" means (i) each Guarantor named in the preamble, (ii) each
Restricted Subsidiary of the Issuer or Subsidiary of Caterair which becomes a
guarantor of the Notes in compliance with the provisions set forth under Section
4.19 and (iii) each Restricted Subsidiary of the Issuer or Subsidiary of
Caterair executing a supplemental indenture in which such Restricted Subsidiary
or Subsidiary, as the case may be, agrees to be bound by the terms of the Notes
and this Indenture.
"Holder" means a holder of Notes.
"Indebtedness" means with respect to any Person, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
25
-16-
(iii) all Capitalized Lease Obligations of such Person, (iv) all obligations of
such Person issued or assumed as the deferred purchase price of property, all
conditional sale obligations and all obligations under any title retention
agreement (but excluding trade accounts payable and accrued expenses arising in
the ordinary course of business), (v) all obligations for the reimbursement of
any obligor on any letter of credit, banker's acceptance or similar credit
transaction, (vi) guarantees and other contingent obligations in respect of
Indebtedness referred to in clauses (i) through (v) above and clause (viii)
below, (vii) all obligations of any other Person of the type referred to in
clauses (i) through (vi) which are secured by any lien on any property or asset
of such Person, the amount of such obligation being deemed to be the amount of
the obligation so secured, (viii) all obligations under currency agreements and
interest swap agreements of such Person, and (ix) all Disqualified Capital Stock
issued by such Person with the amount of Indebtedness represented by such
Disqualified Capital Stock being equal to the greater of its voluntary or
involuntary liquidation preference and its maximum fixed repurchase price, but
excluding accrued dividends, if any. For purposes hereof, the "maximum fixed
repurchase price" of any Disqualified Capital Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Disqualified Capital Stock as if such Disqualified Capital Stock were purchased
on any date on which Indebtedness shall be required to be determined pursuant to
this Indenture, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value shall be
determined reasonably and in good faith by the Board of Directors of the issuer
of such Disqualified Capital Stock. The amount of Indebtedness of any Person at
any date shall be the outstanding principal amount of all unconditional
obligations described above, as such amount would be reflected on a balance
sheet prepared in conformity with GAAP, and the maximum liability at such date
of such Person for any contingent obligations described above.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Initial Notes" has the meaning provided in the preamble to this
Indenture.
"Initial Purchasers" means BT Securities Corporation, X.X. Xxxxxx
Securities Inc., Credit Suisse First Boston Corpo-
26
-17-
ration, Xxxxxxx, Sachs & Co., Xxxxx Xxxxxx Inc. and Bankers Trust International
PLC.
"Institutional Accredited Investor" means an institution that is an
accredited investor as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"interest" when used with respect to any Note means the amount of all
interest accruing on such Note, including any applicable defaulted interest
pursuant to Section 2.12 and any Additional Interest pursuant to the
Registration Rights Agreement.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Notes.
"Interest Swap Obligations" means the obligations of any Person,
pursuant to any arrangement with any other Person, whereby, directly or
indirectly, such Person is entitled to receive from time to time periodic
payments calculated by applying either a floating or a fixed rate of interest on
a stated notional amount in exchange for periodic payments made by such other
Person calculated by applying a fixed or a floating rate of interest on the same
notional amount.
"Investment" means, with respect to any Person any direct or indirect
loan or other extension of credit (including, without limitation, a guarantee)
or capital contribution to (by means of any transfer of cash or other property
to others or any payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by the
Issuer and its Restricted Subsidiaries and Caterair and its Subsidiaries on
commercially reasonable terms in accordance with normal trade practices of the
Issuer and its Restricted Subsidiaries or Caterair and its Subsidiaries, as the
case may be. In no event shall this definition of "Investment" include payments
by the Issuer to a trust established in connection with a Voluntary Employees'
Beneficiary Association (as referred to in Section 501(c)(9) of the Internal
Revenue Code of 1986). For the purposes of Section 4.10, (i) an "Investment"
shall include and be valued at the fair market value of the net assets of any
Restricted Subsidiary of the
27
-18-
Issuer at the time that such Restricted Subsidiary is designated an Unrestricted
Subsidiary of the Issuer and shall exclude the fair market value of the net
assets of any Unrestricted Subsidiary of the Issuer at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary of the Issuer and
(ii) the amount of any Investment shall be the original cost of such Investment
plus the cost of all additional Investments by the Issuer or any Restricted
Subsidiary of the Issuer or Caterair or any Subsidiary of Caterair, as the case
may be, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment, reduced by
the payment of dividends or distributions (including tax sharing payments) in
connection with such Investment or any other amounts received in respect of such
Investment, to the extent constituting a return on capital in conformity with
GAAP.
"Issue Date" means the date of original issuance of the Notes.
"Issuer" means SC International Services, Inc.
"Legal Holiday" has the meaning provided in Section 10.07.
"Lien" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest but excluding operating leases of real
or personal property).
"LSG/Lufthansa" means LSG Lufthansa Service GmbH, a company organized
under the laws of the Federal Republic of Germany.
"Lufthansa" means Deutsche Lufthansa AG, an Aktiengesellschaft
organized under the laws of the Federal Republic of Germany.
"Maturity Date" means September 1, 2007.
"Net Cash Proceeds" means, (i) with respect to any Asset Sale or
Caterair Asset Sale, as the case may be, the proceeds in the form of cash or
Cash Equivalents including payments in respect of deferred payment obligations
when received in the form of cash or Cash Equivalents (other than the portion of
any such deferred payment constituting interest) received by the Issuer or any
Restricted Subsidiary of the Issuer or Caterair or any Subsidiary of Caterair,
as the case may be, from such Asset Sale or Caterair Asset Sale, as the case may
be, net
28
-19-
of (a) out-of-pocket expenses and fees relating to such Asset Sale or Caterair
Asset Sale, as the case may be (including, without limitation, legal, accounting
and investment banking fees and sales commissions), (b) any and all taxes paid
or payable after taking into account any reduction in consolidated tax liability
due to available tax credits or deductions and any tax sharing arrangements, (c)
repayment of Indebtedness that is required to be repaid in connection with such
Asset Sale or Caterair Asset Sale, as the case may be, (d) any portion of cash
proceeds which the Issuer or Caterair, as the case may be, determines in good
faith should be reserved for post-closing adjustments or indemnities, it being
understood and agreed that on the day that all such post-closing adjustments or
indemnities have been determined, the amount (if any) by which the reserved
amount in respect of such Asset Sale or Caterair Asset Sale, as the case may be,
exceeds the actual post-closing adjustments or indemnities payable by the Issuer
or any Restricted Subsidiary of the Issuer or Caterair or any Subsidiary of
Caterair, as the case may be, shall constitute Net Cash Proceeds on such date or
(ii) with respect to the sale of Capital Stock by any Person not constituting an
Asset Sale or Caterair Asset Sale, as the case may be, the aggregate net cash
proceeds received by such Person after payment of expenses, commissions and
other similar charges incurred in connection therewith.
"Net Proceeds Offer" has the meaning set forth in Section 4.16.
"Net Proceeds Offer Amount" has the meaning set forth in Section 4.16.
"Net Proceeds Offer Trigger Date" has the meaning set forth in Section
4.16.
"Non-Significant Subsidiary" of any Person means any Restricted
Subsidiary of such Person which at the time of determination is not a
Significant Subsidiary of such Person.
"Non-U.S. Person" means a Person who is not a U.S. Person as defined in
Regulation S.
"Notes" has the meaning provided in the preamble to this Indenture.
"Obligations" means all obligations for, or guaranteeing the payment
of, principal, premium, interest, penalties, fees, indemnifications,
reimbursements, damages and other li-
29
-20-
abilities payable under the documentation governing any Indebtedness, without
duplication.
"Offering Memorandum" means the Offering Memorandum, dated August 22,
1997, pursuant to which the Initial Notes were offered and any supplement
thereto.
"Officers' Certificate" means a certificate signed by two officers of
the Issuer.
"OFSI" means Onex Food Services, Inc., a Delaware corporation.
"OFSI Tax Sharing Agreement" means the Tax Sharing Agreement, dated the
Issue Date, among OFSI, the Issuer, Sky Chefs and CII.
"Oncap" means Oncap Holdings Corp., an Ontario corporation.
"Onex" means Onex Corporation, an Ontario corporation.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee complying with the requirements of Sections
13.04 and 13.05, as they relate to the giving of an Opinion of Counsel.
"Paying Agent" has the meaning provided in Section 2.03.
"Permitted Holder" means (i) Lufthansa, (ii) LSG/Lufthansa, (iii)
Xxxxxx X. Xxxxxxxx, (iv) Onex and/or (v) Oncap.
"Permitted Indebtedness" means, without duplication, (i) the Notes,
(ii) the Guarantees, (iii) Indebtedness incurred pursuant to the Senior Bank
Financing, the aggregate outstanding principal amount of which shall not at any
time exceed the sum of the aggregate commitments pursuant to the Senior Bank
Financing as in effect on the Issue Date (A) less the amount of all mandatory
principal payments actually made in respect of the term loan thereunder and (B)
reduced by any required repayments (which are accompanied by a corresponding
permanent commitment reduction) thereunder actually effected in satisfaction of
the application of the Net Cash Proceeds requirement described under Section
4.16, (iv) other Indebtedness of the Issuer, Caterair and their respective
Subsidiaries outstanding on
30
-21-
the Issue Date, (v) Interest Swap Obligations covering Indebtedness of the
Issuer, Caterair or any of their respective Subsidiaries; provided that any
Indebtedness to which any such Interest Swap Obligations correspond is otherwise
permitted to be incurred under this Indenture; provided, further, that such
Interest Swap Obligations are entered into, in the judgment of the Issuer or
Caterair, as the case may be, to protect the Issuer or any Subsidiary of the
Issuer or Caterair or any Subsidiary of Caterair, as the case may be, from
fluctuations in interest rates on their respective outstanding Indebtedness,
(vi) Indebtedness under Currency Agreements, (vii) (A) intercompany Indebtedness
owed by the Issuer to any Wholly Owned Restricted Subsidiary of the Issuer or by
any Restricted Subsidiary of the Issuer to the Issuer or any Wholly Owned
Restricted Subsidiary of the Issuer, (B) intercompany Indebtedness owed by
Caterair to any Wholly Owned Subsidiary of Caterair or by any Subsidiary of
Caterair to Caterair or any Wholly Owned Subsidiary of Caterair and (C)
Indebtedness between the Issuer or any Wholly Owned Restricted Subsidiary of the
Issuer, on the one hand, and Caterair or any Wholly Owned Subsidiary of
Caterair, on the other hand, (viii) Acquired Indebtedness to the extent the
Issuer could have incurred such Indebtedness in accordance with Section 4.12,
(ix) (A) performance bonds, completion guarantees and similar obligations
(exclusive of obligations for the payment of borrowed money), (B) guarantees
pursuant to Section 4.19 and (C)(1) guarantees by the Issuer or any Wholly Owned
Restricted Subsidiary of the Issuer of Indebtedness of Caterair or any Wholly
Owned Subsidiary of Caterair, (2) guarantees by Caterair or any Wholly Owned
Subsidiary of Caterair of Indebtedness of the Issuer or any Wholly Owned
Restricted Subsidiary of the Issuer, (3) guarantees by the Issuer and its Wholly
Owned Restricted Subsidiaries of each other's Indebtedness and (4) guarantees by
Caterair and its Wholly Owned Subsidiaries of each other's Indebtedness;
provided that in the case of each guarantee of Indebtedness pursuant to clause
(C)(1), (C)(2), (C)(3) or (C)(4), such Indebtedness is incurred in accordance
with the provisions of this Indenture, (x) in addition to Capitalized Lease
Obligations permitted under any other clause of this definition, purchase money
Indebtedness and Indebtedness evidenced by Capitalized Lease Obligations not to
exceed an aggregate of $10 million at any one time outstanding, (xi) any
refinancing, modification, replacement, renewal, restatement, refunding,
deferral, extension, substitution, supplement, reissuance or resale of existing
or future Indebtedness, including Capitalized Lease Obligations incurred after
the repayment of all or a portion of the Capitalized Lease Obligations
outstanding as of the Issue Date so long as the aggregate amount of Capitalized
Lease Obli-
31
-22-
gations incurred and outstanding at any time pursuant to clause (iv) above and
this clause (xi) does not exceed the amount of Capitalized Lease Obligations
outstanding on the Issue Date, and any additional Indebtedness incurred to pay
premiums required by the instruments governing such existing or future
Indebtedness as in effect at the time of issuance thereof ("Required Premiums")
and fees in connection therewith; provided that any such event shall not (1)
result in an increase in the aggregate principal amount of Permitted
Indebtedness (except to the extent such increase is a result of a simultaneous
incurrence of additional Indebtedness (A) to pay Required Premiums and related
fees or (B) otherwise permitted to be incurred under this Indenture) of the
Issuer, Caterair and their respective Subsidiaries and (2) create Indebtedness
with a Weighted Average Life to Maturity at the time such Indebtedness is
incurred that is less than the Weighted Average Life to Maturity at such time of
the Indebtedness being refinanced, modified, replaced, renewed, restated,
refunded, deferred, extended, substituted, supplemented, reissued or resold
(except that this subclause (2) will not apply in the event the Indebtedness
being refinanced, modified, replaced, renewed, restated, refunded, deferred,
extended, substituted, supplemented, reissued or resold was originally incurred
in reliance upon clause (iii), (xi) or (xiii) of this definition), (xii)
Indebtedness incurred in connection with the exercise of the purchase options
for the Caterair Leased Property pursuant to the Caterair Lease and the Caterair
Licensed Property pursuant to the Caterair License; provided that any payment
made to Caterair in connection with the exercise of such options is used by
Caterair to prepay Guarantor Senior Debt or, if there is no Guarantor Senior
Debt outstanding, to prepay Senior Debt and/or to repay the Caterair Promissory
Note; provided that if Caterair elects to repay the Caterair Promissory Note,
the Issuer immediately uses the proceeds received from such repayment to prepay
Senior Debt, and (xiii) additional Indebtedness of the Issuer, Caterair and
Restricted Subsidiaries of the Issuer in an aggregate principal amount not to
exceed $75 million at any one time outstanding (which amount may, but need not,
be incurred in whole or in part under the Senior Bank Financing).
"Permitted Investments" means (i) (A) Investments by the Issuer or any
Restricted Subsidiary of the Issuer in, or for the benefit of, any Restricted
Subsidiary of the Issuer (whether existing on the Issue Date or created
thereafter and including Investments in any Person, if after giving effect to
such Investment, such Person would be a Restricted Subsidiary of the Issuer) and
Investments in, or for the benefit of, the Issuer by any Restricted Subsidiary
of the Issuer and (B) In-
32
-23-
vestments by Caterair in, or for the benefit of, any Wholly Owned Subsidiary of
Caterair and Investments in, or for the benefit of, Caterair by any Subsidiary
of Caterair, (ii) cash and Cash Equivalents, (iii) Investments existing on the
Issue Date, except for Investments in Restricted Subsidiaries of the Issuer,
which shall be governed by clause (i)(A) above, (iv) Investments in securities
of trade creditors or customers received pursuant to any plan of reorganization
or similar arrangement upon the bankruptcy or insolvency of such trade creditors
or customers, (v) loans and advances by the Issuer and its Subsidiaries to their
respective employees (A) the proceeds of which are used to purchase common stock
of OFSI and which proceeds are contributed by OFSI to the Issuer (which
contribution shall not be included as a capital contribution for purposes of
clause (iii)(z) of the first paragraph of Section 4.10) or (B) in the ordinary
course of business, which loans or advances do not exceed $3 million at any one
time outstanding, (vi) the Guarantees, (vii) any Investment that qualifies as
Permitted Indebtedness, (viii) Investments by the Issuer or any Restricted
Subsidiary of the Issuer in Unrestricted Subsidiaries of the Issuer or in other
Persons in an amount not to exceed $30 million at any one time outstanding, (ix)
(A) Investments by the Issuer or any Restricted Subsidiary of the Issuer in
Caterair or any Wholly Owned Subsidiary of Caterair and (B) Investments by
Caterair or any Subsidiary of Caterair in the Issuer or any Restricted
Subsidiary of the Issuer, (x) Investments received by the Issuer or any
Restricted Subsidiary of the Issuer or Caterair or any Subsidiary of Caterair,
as the case may be, as consideration for asset sales, including Asset Sales or
Caterair Asset Sales; provided that in the case of an Asset Sale or Caterair
Asset Sale, such Asset Sale or Caterair Asset Sale is effected in compliance
with Section 4.16 and (xi) in addition to Investments permitted under clause
(viii) above, Investments in Unrestricted Subsidiaries that are engaged in the
business of providing airline catering services and Airline Catering Joint
Ventures in an aggregate amount not to exceed $50 million at any one time
outstanding.
"Permitted Liens" means the following types of Liens:
(i) Liens for taxes, assessments or governmental charges or claims
either (a) not delinquent or (b) contested in good faith by appropriate
proceedings and as to which the Issuer or its Restricted Subsidiaries or
Caterair or its Subsidiaries, as the case may be, shall have set aside on
its books such reserves as may be required in conformity with GAAP;
33
-24-
(ii) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law
incurred in the ordinary course of business, as well as deposits to secure
each of the foregoing, for sums not yet delinquent more than 60 days or
being contested in good faith, if such reserve or other appropriate
provision, if any, as shall be required by GAAP for financial reporting
purposes shall have been made in respect thereof;
(iii) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security, including any Lien securing letters of
credit issued in the ordinary course of business consistent with past
practice in connection therewith, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money);
(iv) judgment Liens not giving rise to an Event of Default;
(v) easements, rights-of-way, zoning restrictions and other similar
charges or encumbrances in respect of real property not interfering in any
material respect with the ordinary conduct of the business of the Issuer and
its Restricted Subsidiaries, taken as a whole, or of Caterair and its
Subsidiaries, taken as a whole, as the case may be;
(vi) any interest or title of a lessor under any Capitalized Lease
Obligation and precautionary filings made for informational purposes in
connection with true leases, consignments and similar arrangements;
(vii) purchase money Liens to finance property or assets of the Issuer
or any Restricted Subsidiary of the Issuer or Caterair or any Subsidiary of
Caterair, as the case may be, acquired in the ordinary course of business;
provided, however, that (A) the related purchase money Indebtedness shall
not exceed the cost of such property or assets and shall not be secured by
any property or assets of the Issuer or any Restricted Subsidiary of the
Issuer or Caterair or any Subsidiary of Caterair, as the case may be, other
than the property and assets so acquired and
34
-25-
(B) the Lien securing such Indebtedness shall be created within 90 days
of such acquisition;
(viii) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligations in respect of
bankers' acceptances issued or created for the account of such Person to
facilitate the purchase, shipment, or storage of such inventory or other
goods;
(ix) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(x) Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual, or warranty requirements of the Issuer
or any Restricted Subsidiary of the Issuer or Caterair or any Subsidiary of
Caterair, as the case may be, including rights of offset and set-off;
(xi) Liens securing Interest Swap Obligations which Interest Swap
Obligations relate to Indebtedness that is otherwise permitted under this
Indenture;
(xii) Liens securing Indebtedness under Currency Agreements;
(xiii) Liens existing on the Issue Date, together with any Liens
securing Indebtedness incurred in reliance on clause (xi) of the definition
of Permitted Indebtedness; provided that the Liens securing the refinancing
Indebtedness shall not extend to property other than that pledged under the
Liens securing the Indebtedness being refinanced;
(xiv) Liens securing Indebtedness incurred in reliance on clause (xiii)
of the definition of Permitted Indebtedness;
(xv) Liens in favor of the Trustee to secure the Issuer's payment
obligations to the Trustee; and
(xvi) non-consensual Liens which do not individually or in the
aggregate materially detract from the value or transferability of the
property or assets of the Issuer, any Restricted Subsidiary of the Issuer,
Caterair or any
35
-26-
Subsidiary of Caterair, or materially impair the use of any such
property or assets in the operation of the respective businesses of the
Issuer, any Restricted Subsidiary of the Issuer, Caterair or any Subsidiary
of Caterair.
"Person" means an individual, partnership, corporation, unincorporated
organization, trust or joint venture, or a governmental agency or political
subdivision thereof.
"Physical Notes" has the meaning provided in Section 2.01.
"Plan of Liquidation" means, with respect to any Person, a plan that
provides for, contemplates or the effectuation of which is preceded or
accompanied by (whether or not substantially contemporaneously, in phases or
otherwise) (i) the sale, lease, conveyance or other disposition of all or
substantially all of the assets of such Person otherwise than as an entirety or
substantially as an entirety and (ii) the distribution of all or substantially
all of the proceeds of such sale, lease, conveyance or other disposition and all
or substantially all of the remaining assets of such person to holders of
Capital Stock of such Person.
"Preferred Stock" of any Person means any Capital Stock of such Person
that has preferential rights to any other Capital Stock of such Person with
respect to dividends or redemptions or upon liquidation.
"principal" of any Indebtedness (including the Notes) means the
principal amount of such Indebtedness plus the premium, if any, on such
Indebtedness.
"Private Exchange Notes" has the meaning set forth in the Registration
Rights Agreement.
"Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth in Section 2.15.
"Proceeds Purchase Date" has the meaning provided in Section 4.16.
"Productive Assets" means assets of a kind used or usable in the
businesses of the Issuer and its Restricted Subsidiaries or Caterair and its
Subsidiaries, as the case may be, or similar, ancillary, complementary or
related to such businesses, as conducted on the date of the relevant Asset Sale
or Caterair Asset Sale, as the case may be, including, without
36
-27-
limitation, equity interests and other assets the acquisition of which would
constitute a "Permitted Investment" under clause (i)(A) of the definition
thereof.
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act.
"Public Equity Offering" means an underwritten public offering of
Qualified Capital Stock of OFSI or the Issuer pursuant to a registration
statement filed with the Commission in accordance with the Securities Act;
provided that in the event of a Public Equity Offering by OFSI, OFSI contributes
to the capital of the Issuer net cash proceeds of such Public Equity Offering in
an amount sufficient to redeem the Notes called for redemption in accordance
with the terms thereof.
"Qualified Capital Stock" means any stock that is not Disqualified
Capital Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Redemption Date," when used with respect to any Note to be redeemed,
means the date fixed for such redemption pursuant to this Indenture and the
Notes.
"redemption price," when used with respect to any Note to be redeemed,
means the price fixed for such redemption, including principal and premium, if
any, pursuant to this Indenture and the Notes.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of August 28, 1997, by and among the Issuer, the Guarantors
and the Initial Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Representative" means the indenture trustee or other trustee, agent or
representative in respect of any Designated Senior Debt; provided that if, and
for so long as, any Designated Senior Debt lacks such a representative, then the
Representative for such Designated Senior Debt shall at all times constitute the
holders of a majority in outstanding principal amount of such Designated Senior
Debt in respect of any Designated Senior Debt.
37
-28-
"Restricted Payment" shall have the meaning set forth in Section 4.10.
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; provided, however, that the Trustee shall be
entitled to request and conclusively rely on an Opinion of Counsel with respect
to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" of any Person means any Subsidiary of such
Person which at the time of determination is not an Unrestricted Subsidiary of
such Person.
"Rule 144A" means Rule 144A promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
"Sale and Leaseback Transaction" means any direct or indirect
arrangement with any Person or to which any such Person is a party, providing
for the leasing to the Issuer or a Restricted Subsidiary of the Issuer or
Caterair or a Subsidiary of Caterair, as the case may be, of any property,
whether owned by the Issuer or a Restricted Subsidiary of the Issuer or Caterair
or a Subsidiary of Caterair, as the case may be, at the Issue Date or later
acquired, which has been or is to be sold or transferred by the Issuer or a
Restricted Subsidiary of the Issuer or Caterair or a Subsidiary of Caterair, as
the case may be, to such Person or to any other Person from whom funds have been
or are to be advanced by such Person on the security of such Property.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Senior Bank Financing" means the Term Loan Agreement dated as of the
Issue Date, among each of SCIS and Caterair, as borrowers, the guarantors
thereunder, the lenders party thereto from time to time in their capacities as
lenders thereunder, and Xxxxxx Guaranty Trust Company of New York, as
administrative agent, X.X. Xxxxxx Securities Inc. and Bankers Trust Company, as
co-arrangers, and Bankers Trust Company, as syndication agent, and the Revolving
Credit Facility, dated as of the Issue Date, among the Issuer, as borrower, the
guarantors
38
-29-
thereunder, the lenders party thereto from time to time in their capacities as
lenders thereunder and Xxxxxx Guaranty Trust Company of New York, as
administrative agent, X.X. Xxxxxx Securities Inc. and Bankers Trust Company, as
co-arrangers, and Bankers Trust Company, as syndication agent, together, in each
case, with the related documents thereto (including, without limitation, any
guarantee agreements and security documents), in each case as such agreements
may be amended (including any amendment and restatement thereof), supplemented
or otherwise modified from time to time, including any agreement extending the
maturity of, increasing the total commitment under, refinancing, replacing or
otherwise restructuring (including adding Restricted Subsidiaries of the Issuer
and Subsidiaries of Caterair as additional borrowers or guarantors thereunder)
all or any portion of the Indebtedness under any such agreement or any successor
or replacement agreement to any thereof and whether by the same or any other
syndication agent, documentation agent, administrative agent, lender or group of
lenders.
"Senior Debt" means the principal of, premium, if any, and interest
(including any interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable law) on, and
all other obligations with respect to, any Indebtedness of the Issuer, whether
outstanding on the Issue Date or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the instrument creating or
evidencing the same or pursuant to which the same is outstanding expressly
provides that such Indebtedness shall not be senior in right of payment to the
Notes. Without limiting the generality of the foregoing, "Senior Debt" shall
also include the principal of, premium, if any, interest (including any interest
accruing subsequent to the filing of a petition of bankruptcy at the rate
provided for in the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law) on, and all other amounts
owing in respect of, (x) all monetary obligations of every nature of the Issuer
under the Senior Bank Financing, including, without limitation, (a) obligations
to pay principal and interest, reimbursement obligations under letters of
credit, fees, expenses and indemnities and (b) guarantees by the Issuer of
Obligations under the Senior Bank Financing where the direct borrower is
Caterair or a Subsidiary of the Issuer, (y) all Interest Swap Obligations and
(z) all obligations under Currency Agreements, in each case whether outstanding
on the Issue Date or thereafter incurred. Notwithstanding the foregoing, Senior
Debt shall not include (i) any Indebtedness, if the instrument creating or
evidencing
39
-30-
the same or the assumption or guarantee thereof expressly provides that such
Indebtedness shall not be senior in right of payment to the Notes, (ii) any
Indebtedness of the Issuer to a Subsidiary of the Issuer, (iii) Indebtedness to,
or guaranteed on behalf of, any director, officer or employee of the Issuer or
any Subsidiary of the Issuer (including, without limitation, amounts owed for
compensation), (iv) Indebtedness to trade creditors and other amounts incurred
in connection with obtaining goods, materials or services, (v) Indebtedness
represented by Disqualified Capital Stock, (vi) any liability for federal,
state, local or other taxes owed or owing by the Issuer, (vii) that portion of
any Indebtedness incurred in violation of the provisions of this Indenture set
forth under Section 4.12 (but, as to any such obligation, no such violation
shall be deemed to exist for purposes of this clause (vii) if the holder(s) of
such obligation or their representative and the Trustee shall have received an
Officers' Certificate of the Issuer to the effect that the incurrence of such
Indebtedness does not (or, in the case of revolving credit Indebtedness, that
the incurrence of the entire committed amount thereof at the date on which the
initial borrowing thereunder is made) would not violate such provisions of this
Indenture); and (viii) any Indebtedness which is, by its express terms,
subordinated in right of payment to any other Indebtedness of the Issuer.
"Significant Subsidiary" means, as of any date of determination, for
any Person, each Subsidiary of such Person (or, in the case of the Issuer, each
Restricted Subsidiary of the Issuer) which (i) for the most recent fiscal year
of such Person accounted for more than 10% of consolidated revenues or 10% of
Consolidated EBITDA of such Person or (ii) as at the end of such fiscal year,
was the owner of more than 10% of the consolidated assets of such Person.
"Sky Chefs" has the meaning provided in the preamble.
"Subordinated Indebtedness" means, with respect to any Guarantor,
Indebtedness of such Guarantor which is subordinated in right of payment to the
Guarantee of such Guarantor.
"Subsidiary", with respect to any Person, means (i) any corporation of
which the outstanding Capital Stock having at least a majority of the votes
entitled to be cast in the election of directors under ordinary circumstances
shall at the time be owned, directly or indirectly, by such Person or (ii) any
other Person of which at least a majority of the vot-
40
-31-
ing interest under ordinary circumstances is at the time, directly or
indirectly, owned by such Person.
"Subsidiary Guarantors" means each of the Guarantors except for
Caterair and any Subsidiary of Caterair and any other Restricted Subsidiary of
the Issuer which becomes a Guarantor of the Notes.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb), as amended, as in effect on the date of this Indenture, except as
otherwise provided in Section 9.03.
"Trust Officer" means any officer or assistant officer of the Trustee
assigned by the Trustee to administer this Indenture, or in the case of a
successor trustee, an officer assigned to the department, division or group
performing the corporate trust work of such successor and assigned to administer
this Indenture.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Unrestricted Notes" means one or more Notes that are not required to
bear the Private Placement Legend in the form set forth in Section 2.15,
including, without limitation, the Exchange Notes.
"Unrestricted Subsidiary" of any Person means (i) any Subsidiary of
such Person that at the time of determination shall be or continue to be
designated an Unrestricted Subsidiary by the Board of Directors of such Person
in the manner provided below and (ii) any Subsidiary of an Unrestricted
Subsidiary. The Board of Directors of the Issuer may designate any Subsidiary of
the Issuer (including any newly acquired or newly formed Subsidiary), other than
a Subsidiary Guarantor, to be an Unrestricted Subsidiary of the Issuer unless
such Subsidiary of the Issuer owns any Capital Stock of, or owns or holds any
Lien on any property of, the Issuer or any other Subsidiary of the Issuer that
is not a Subsidiary of the Subsidiary to be so designated; provided that (x) the
Issuer certifies to the Trustee that such designation complies with Section 4.10
and (y) each Subsidiary of the Issuer to be so designated and each of its
Subsidiaries has not at the time of designation, and does not thereafter,
create, incur, issue, assume, guarantee or otherwise become directly or
indirectly liable with respect to any
41
-32-
Indebtedness pursuant to which the lender has recourse to any of the assets of
the Issuer or any of its Restricted Subsidiaries. Notwithstanding the foregoing,
the Issuer or a Restricted Subsidiary of the Issuer may guarantee Indebtedness
of an Unrestricted Subsidiary of the Issuer if such guarantee is made in
accordance with Section 4.10. The Board of Directors of the Issuer may designate
any Unrestricted Subsidiary of the Issuer to be a Restricted Subsidiary of the
Issuer only if (x) immediately after giving effect to such designation, the
Issuer is able to incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) in compliance with Section 4.12 and (y) immediately
before and immediately after giving effect to such designation, no Default or
Event of Default shall have occurred and be continuing. Any such designation by
the Board of Directors of the Issuer shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the resolution 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 of, and
obligations guaranteed by, the United States of America for the payment of which
the full faith and credit of the United States of America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (a) the then
outstanding aggregate principal amount of such Indebtedness into (b) the sum of
the total of the products obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (ii)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person means any Restricted
Subsidiary of such Person of which all the outstanding voting securities (other
than directors' qualifying shares) are owned by such Person or any Wholly Owned
Restricted Subsidiary of such Person.
"Wholly Owned Subsidiary" of any Person means any Subsidiary of such
Person of which all the outstanding voting
42
-33-
securities (other than directors' qualifying shares) are owned by such Person or
any Wholly Owned Subsidiary of such Person.
SECTION 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Notes.
"indenture securities holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer or any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP as in effect on the Issue Date;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular; and
(5) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
43
-34-
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating.
The Initial Notes and the Trustee's certificate of authentication
relating thereto shall be substantially in the form of Exhibit A hereto. The
Exchange Notes and the Trustee's certificate of authentication relating thereto
shall be substantially in the form of Exhibit B hereto. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or
depository rule or usage. The Issuer and the Trustee shall approve the form of
the Notes and any notation, legend or endorsement on them. If required, the
Notes may bear the appropriate legend regarding any original issue discount for
federal income tax purposes. Each Note shall be dated the date of its issuance
and shall show the date of its authentication. Subject to Section 4.19, each
Note shall have an executed Guarantee from each of the Guarantors endorsed
thereon substantially in the form included in Exhibit A and Exhibit B hereto.
The terms and provisions contained in the Notes, annexed hereto as
Exhibits A and B, shall constitute, and are hereby expressly made, a part of
this Indenture and, to the extent applicable, the Issuer, the Guarantors and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.
Notes offered and sold in reliance on Rule 144A, Notes offered and sold
to institutional "accredited investors" (as defined in Rule 501(a)(1), (2), (3)
or (7) under the Securities Act) and Notes offered and sold in reliance on
Regulation S shall be issued initially in the form of one or more permanent
global Notes in registered form, substantially in the form set forth in Exhibit
A (the "Global Note"), deposited with the Trustee, as custodian for the
Depository, duly executed by the Issuer (and having an executed Guarantee
endorsed thereon) and authenticated by the Trustee as hereinafter provided and
shall bear the legend set forth in Section 2.15. The aggregate principal amount
of the Global Note may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depository,
as hereinafter provided.
44
-35-
Notes issued in exchange for interests in a Global Note pursuant to
Section 2.16 may be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "Physical
Notes"). All Notes offered and sold in reliance on Regulation S shall remain in
the form of a Global Note until the consummation of the Exchange Offer pursuant
to the Registration Rights Agreement; provided, however, that all of the time
periods specified in the Registration Rights Agreement to be complied with by
the Issuer have been so complied with.
SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and a Secretary or an Assistant Secretary,
of the Issuer shall sign, or one Officer shall sign and one Officer, a Secretary
or an Assistant Secretary (each of whom shall, in each case, have been duly
authorized by all requisite corporate actions) shall attest to, the Notes by
manual or facsimile signature. The endorsement of the Guarantee by each
Guarantor shall be executed by an Officer, a Secretary, an Assistant Secretary
or another authorized signatory of such Guarantor.
If an Officer, Secretary or Assistant Secretary whose signature is on a
Note or a Guarantee was an Officer, Secretary or Assistant Secretary at the time
of such execution but no longer holds that office or position at the time the
Trustee authenticates the Note, the Note shall nevertheless be valid.
A Note shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee shall authenticate (i) Initial Notes for original issue in
the aggregate principal amount not to exceed $300,000,000, (ii) Private Exchange
Notes from time to time only in exchange for a like principal amount of Initial
Notes and (iii) Unrestricted Notes from time to time only (x) in exchange for a
like principal amount of Initial Notes or (y) in an aggregate principal amount
of not more than the excess of $300,000,000 over the sum of the aggregate
principal amount of (A) Initial Notes then outstanding, (B) Private Exchange
Notes then outstanding and (C) Unrestricted Notes issued in accordance with
(iii)(x) above, in each case upon a written order of the Issuer in the form of
an Officers' Certificate of the Issuer. Each such written order shall specify
the amount of Notes to be authenticated and the date on which the Notes are
45
-36-
to be authenticated, whether the Notes are to be Initial Notes, Private Exchange
Notes or Unrestricted Notes and whether the Notes are to be issued as Physical
Notes or Global Notes. In addition, with respect to authentication pursuant to
clauses (ii) or (iii) of the first sentence of this paragraph, the first such
written order from the Issuer shall be accompanied by an Opinion of Counsel of
the Issuer in a form reasonably satisfactory to the Trustee stating that the
issuance of the Private Exchange Notes or the Unrestricted Notes, as the case
may be, does not give rise to an Event of Default, complies with this Indenture
and has been duly authorized by the Issuer. The aggregate principal amount of
Notes outstanding at any time may not exceed $300,000,000, except as provided in
Sections 2.07 and 2.08.
In the event that the Issuer shall issue and the Trustee shall
authenticate any Notes issued under this Indenture subsequent to the Issue Date
pursuant to clauses (i) and (iii) of the first sentence of the immediately
preceding paragraph, the Issuer shall use its reasonable best efforts to obtain
the same "CUSIP" number for such Notes as is printed on the Notes outstanding at
such time; provided, however, that if any series of Notes issued under this
Indenture subsequent to the Issue Date is determined, pursuant to an Opinion of
Counsel of the Issuer in a form reasonably satisfactory to the Trustee, to be a
different class of security than the Notes outstanding at such time for federal
income tax purposes, the Issuer may obtain a "CUSIP" number for such Notes that
is different than the "CUSIP" number printed on the Notes then outstanding.
Notwithstanding the foregoing, all Notes issued under this Indenture shall vote
and consent together on all matters as one class and no series of Notes will
have the right to vote or consent as a separate class on any matter.
The Trustee may appoint an authenticating agent (the "Authenticating
Agent") reasonably acceptable to the Issuer to authenticate Notes. Unless
otherwise provided in the appointment, an Authenticating Agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such Authenticating
Agent. An Authenticating Agent has the same rights as an Agent to deal with the
Issuer or with any Affiliate of the Issuer.
The Notes shall be issuable in fully registered form only, without
coupons, in denominations of $1,000 and any integral multiple thereof.
46
-37-
SECTION 2.03. Registrar and Paying Agent.
The Issuer shall maintain an office or agency (which shall be located
in the Borough of Manhattan in the City of New York, State of New York), where
(a) Notes may be presented or surrendered for registration of transfer or for
exchange ("Registrar"), (b) Notes may be presented or surrendered for payment
("Paying Agent") and (c) notices and demands to or upon the Issuer in respect of
the Notes and this Indenture may be served. The Registrar shall keep a register
of the Notes and of their transfer and exchange. The Issuer, upon notice to the
Trustee, may have one or more co-Registrars and one or more additional paying
agents reasonably acceptable to the Trustee. The term "Paying Agent" includes
any additional paying agent.
The Issuer shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall incorporate the
provisions of the TIA and implement the provisions of this Indenture that relate
to such Agent. The Issuer shall notify the Trustee, in advance, of the name and
address of any such Agent. If the Issuer fails to maintain a Registrar or Paying
Agent, the Trustee shall act as such.
The Issuer initially appoints the Trustee as Registrar and Paying Agent
until such time as the Trustee has resigned or a successor has been appointed.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Issuer shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
the Holders or the Trustee all assets held by the Paying Agent for the payment
of principal of, or interest on, the Notes (whether such assets have been
distributed to it by the Issuer or any other obligor on the Notes), and shall
notify the Trustee of any default by the Issuer (or any other obligor on the
Notes) in making any such payment. The Issuer at any time may require a Paying
Agent to distribute all assets held by it to the Trustee and account for any
assets disbursed and the Trustee may at any time during the continuance of any
payment Default, upon written request to a Paying Agent, require such Paying
Agent to distribute all assets held by it to the Trustee and to account for any
assets distributed. Upon distribution to the Trustee of all assets that shall
have been delivered by the Issuer to the Paying Agent and the completion of any
accounting required to be made
47
-38-
hereunder, the Paying Agent shall have no further liability for such assets.
SECTION 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders. If the Trustee is not the Registrar, the Issuer shall furnish to
the Trustee five (5) Business Days before each Interest Payment Date and at such
other times as the Trustee may request in writing a list as of the applicable
Record Date and in such form as the Trustee may reasonably require of the names
and addresses of the Holders, which list may be conclusively relied upon by the
Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to Sections 2.16 and 2.17, when Notes are presented to the
Registrar or a co-Registrar with a request to register the transfer of such
Notes or to exchange such Notes for an equal principal amount of Notes of other
authorized denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested if its requirements for such
transaction are met; provided, however, that the Notes presented or surrendered
for registration of transfer or exchange shall be duly endorsed or accompanied
by a written instrument of transfer in form satisfactory to the Issuer, the
Trustee and the Registrar or co-Registrar, duly executed by the Holder thereof
or his attorney duly authorized in writing. To permit registration of transfers
and exchanges, the Issuer shall execute and the Trustee shall authenticate Notes
and each of the Guarantors shall execute a Guarantee thereon at the Registrar's
or co-Registrar's request. No service charge shall be made for any registration
of transfer or exchange, but the Issuer may require payment of a sum sufficient
to cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchanges or transfers pursuant to Sections 2.10, 3.04, 4.15, 4.16
or 9.05, in which event the Issuer shall be responsible for the payment of such
taxes).
The Registrar or co-Registrar shall not be required to register the
transfer of or exchange of any Note (i) during a period beginning at the opening
of business 15 days before the mailing of a notice of redemption of Notes and
ending at the close of business on the day of such mailing and (ii) selected for
redemption in whole or in part pursuant to
48
-39-
Article Three, except the unredeemed portion of any Note being redeemed in part.
Any Holder of a beneficial interest in a Global Note shall, by
acceptance of such Global Note, agree that transfers of beneficial interests in
such Global Notes may be effected only through a book entry system maintained by
the Holder of such Global Note (or its agent), and that ownership of a
beneficial interest in the Note shall be required to be reflected in a book
entry system.
SECTION 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the Holder of a
Note claims that the Note has been lost, destroyed or wrongfully taken, the
Issuer shall issue and the Trustee shall authenticate a replacement Note and
each of the Guarantors shall execute a Guarantee thereon if the Trustee's
requirements are met. Such Holder must provide an indemnity bond or other
indemnity, sufficient in the reasonable judgment of the Issuer, the Guarantors
and the Trustee, to protect the Issuer, the Guarantors, the Trustee or any Agent
from any loss which any of them may suffer if a Note is replaced. Every
replacement Note shall constitute an additional obligation of the Issuer and the
Guarantors.
SECTION 2.08. Outstanding Notes.
Notes outstanding at any time are all the Notes that have been
authenticated by the Trustee except those cancelled by it, those delivered to it
for cancellation and those described in this Section as not outstanding. Subject
to Section 2.09, Note does not cease to be outstanding because the Issuer or any
of its Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.07 (other than a mutilated
Note surrendered for replacement), it ceases to be outstanding unless the
Trustee receives proof satisfactory to it that the replaced Note is held by a
bona fide purchaser. A mutilated Note ceases to be outstanding upon surrender of
such Note and replacement thereof pursuant to Section 2.07.
If on a Redemption Date or the Maturity Date the Paying Agent holds
U.S. Legal Tender or U.S. Government Obligations sufficient to pay all of the
principal and interest due on the Notes payable on that date and is not
prohibited from paying such money to the Holders thereof pursuant to the terms
49
-40-
of this Indenture, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver, consent or notice, and for
purposes of determining the amount of Notes outstanding at the time of a
redemption made in accordance with paragraph 6(b) of the Notes, Notes owned by
the Issuer or an Affiliate of the Issuer shall be considered as though they are
not outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any direction, waiver or consent, only Notes
which the Trustee actually knows are so owned shall be so considered. The Issuer
shall notify the Trustee, in writing, when it or any of its Affiliates
repurchases or otherwise acquires Notes, of the aggregate principal amount of
such Notes so repurchased or otherwise acquired.
SECTION 2.10. Temporary Notes.
Until definitive Notes are ready for delivery, the Issuer may prepare
and the Trustee shall authenticate temporary Notes upon receipt of a written
order of the Issuer in the form of an Officers' Certificate. The Officers'
Certificate shall specify the amount of temporary Notes to be authenticated and
the date on which the temporary Notes are to be authenticated. Temporary Notes
shall be substantially in the form of definitive Notes but may have variations
that the Issuer considers appropriate for temporary Notes. Without unreasonable
delay, the Issuer shall prepare and execute, and the Trustee shall authenticate
upon receipt of a written order of the Issuer pursuant to Section 2.02,
definitive Notes in exchange for temporary Notes.
SECTION 2.11. Cancellation.
The Issuer at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee or,
at the direction of the Trustee, the Registrar or the Paying Agent, and no one
else, shall cancel and, at the written direction of the Issuer, shall dispose of
(but shall not be required to destroy) all Notes surrendered for transfer,
exchange, payment or cancellation. Subject to Section 2.07, the Issuer may not
issue new Notes to replace Notes that the Issuer has paid or delivered to
50
-41-
the Trustee for cancellation. If the Issuer shall acquire any of the Notes, such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Notes unless and until the same are surrendered
to the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Issuer defaults in a payment of interest on the Notes, it shall
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest to the Persons who are Holders on a subsequent special
record date, which date shall be the fifteenth day next preceding the date fixed
by the Issuer for the payment of defaulted interest or the next succeeding
Business Day if such date is not a Business Day. At least 15 days before the
subsequent special record date, the Issuer shall mail to each Holder, with a
copy to the Trustee, a notice that states the subsequent special record date,
the payment date and the amount of defaulted interest, and interest payable on
such defaulted interest, if any, to be paid.
SECTION 2.13. CUSIP Number.
The Issuer in issuing the Notes may use a "CUSIP" number, and if so,
the Trustee shall use the CUSIP number in notices of redemption or exchange as a
convenience to Holders; provided that no representation is hereby deemed to be
made by the Trustee as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Notes, and that reliance may be placed only on
the other identification numbers printed on the Notes. The Issuer shall promptly
notify the Trustee of any change in the CUSIP numbers.
SECTION 2.14. Deposit of Moneys.
Prior to each Interest Payment Date and Maturity Date, the Issuer shall
have deposited with the Paying Agent in immediately available funds money
sufficient to make cash payments, if any, due on such Interest Payment Date or
Maturity Date, as the case may be, in a timely manner which permits the Paying
Agent to remit payment to the Holders on such Interest Payment Date or Maturity
Date, as the case may be.
SECTION 2.15. Restrictive Legends.
Each Global Note and Physical Note that constitutes a Restricted
Security or is sold in compliance with Regulation S
51
-42-
shall bear the following legend (the "Private Placement Legend") on the face
thereof until after the second anniversary of the later of the Issue Date and
the last date on which the Issuer or any Affiliate of the Issuer was the owner
of such Note (or any predecessor security) (or such shorter period of time as
permitted by Rule 144(k) under the Securities Act or any successor provision
thereunder) (or such longer period of time as may be required under the
Securities Act or applicable state securities laws in the opinion of counsel for
the Issuer, unless otherwise agreed by the Issuer and the Holder thereof):
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION
HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3),
OR (7) UNDER THE SECURITIES ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT
A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 903 OR 904 UNDER THE SECURITIES ACT, (2) AGREES THAT IT
WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE ISSUER THEREOF OR ANY
SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT,
(C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT,
PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S.
BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF
THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR
THIS NOTE), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT
(IF AVAILABLE), OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
52
-43-
LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN TWO YEARS
AFTER THE ORIGINAL ISSUANCE OF THIS NOTE, IF THE PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE AND THE ISSUER SUCH CERTIFICATIONS, LEGAL OPINIONS OR
OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE 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. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND
"U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
Each Global Note shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH SUCCESSOR DEPOSITORY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT HEREON 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 NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.17 OF THE INDENTURE.
53
-44-
SECTION 2.16. Book-Entry Provisions for Global Note.
(a) The Global Notes initially shall (i) be registered in the name of
the Depository or the nominee of such Depository, (ii) be delivered to the
Trustee as custodian for such Depository and (iii) bear legends as set forth in
the penultimate and last paragraphs of Section 2.15.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depository, or the Trustee as its custodian, or under the
Global Note, and the Depository may be treated by the Issuer, the Trustee and
any Agent of the Issuer or the Trustee as the absolute owner of such Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Issuer, the Trustee or any Agent of the Issuer or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers in whole,
but not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in a Global Note may be transferred or exchanged
for Physical Notes in accordance with the rules and procedures of the Depository
and the provisions of Section 2.17. In addition, Physical Notes shall be
transferred to all beneficial owners in exchange for their beneficial interests
in a Global Note if (i) the Depository notifies the Issuer that it is unwilling
or unable to continue as Depository for the Global Notes and a successor
depositary is not appointed by the Issuer within 90 days of such notice or (ii)
an Event of Default has occurred and is continuing and the Registrar has
received a written request from the Depository to issue Physical Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Note to beneficial owners pursuant to paragraph
(b), the Registrar shall (if one or more Physical Notes are to be issued)
reflect on its books and records the date and a decrease in the principal amount
of such Global Note in an amount equal to the principal amount of the beneficial
interest in the Global Note to be transferred, and the Issuer shall execute, the
Guarantors shall execute Guarantees on, and the Trustee shall authenticate and
54
-45-
make available for delivery, one or more Physical Notes of like tenor and
amount.
(d) In connection with the transfer of an entire Global Note to
beneficial owners pursuant to paragraph (b), such Global Note shall be deemed to
be surrendered to the Trustee for cancellation, and the Issuer shall execute,
the Guarantors shall execute Guarantees on and the Trustee shall authenticate
and make available for delivery, to each beneficial owner identified by the
Depository in exchange for its beneficial interest in the Global Note, an equal
aggregate principal amount of Physical Notes of authorized denominations.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b) or (c)
shall, except as otherwise provided by paragraphs (a)(i)(x) and (c) of Section
2.17, bear the legend regarding transfer restrictions applicable to the Physical
Notes set forth in Section 2.15.
(f) The Holder of a Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
SECTION 2.17. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and
Non-U.S. Persons. The following provisions shall apply with respect to the
registration of any proposed transfer of a Note constituting a Restricted
Security to any Institutional Accredited Investor which is not a QIB or to any
Non-U.S. Person:
(i) the Registrar shall register the transfer of any Note constituting
a Restricted Security, whether or not such Note bears the Private Placement
Legend, if (x) the requested transfer is after the second anniversary of the
Issue Date (provided, however, that neither the Issuer nor any Affiliate of
the Issuer has held any beneficial interest in such Note, or portion
thereof, at any time on or prior to the second anniversary of the Issue
Date) or (y) (1) in the case of a transfer to an Institutional Accredited
Investor which is not a QIB (excluding Non-U.S. Persons), the proposed
transferee has delivered to the Registrar a certificate substantially in the
form of Exhibit C hereto and any legal opinions and certifications
55
-46-
required thereby or (2) in the case of a transfer to a Non-U.S. Person, the
proposed transferor has delivered to the Registrar a certificate
substantially in the form of Exhibit D hereto and such other information
that the Trustee may reasonably request in order to confirm that such
transaction is being made pursuant to an exemption from or in a transaction
not subject to the registration requirements of the Securities Act; and
(ii) if the proposed transferor is an Agent Member holding a beneficial
interest in the Global Note, upon receipt by the Registrar of (x) the
certificate, if any, required by paragraph (i) above and (y) written
instructions given in accordance with the Depository's and the Registrar's
procedures,
whereupon (a) the Registrar shall reflect on its books and records the date and
(if the transfer does not involve a transfer of outstanding Physical Notes) a
decrease in the principal amount of such Global Note in an amount equal to the
principal amount of the beneficial interest in the Global Note to be
transferred, and (b) the Issuer shall execute, the Guarantors shall execute the
Guarantees on and the Trustee shall authenticate and make available for delivery
one or more Physical Notes of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note constituting a
Restricted Security to a QIB (excluding transfers to Non-U.S. Persons):
(i) the Registrar shall register the transfer if such transfer is being
made by a proposed transferor who has checked the box provided for on the
form of Note stating, or has otherwise advised the Issuer and the Registrar
in writing, that the sale has been made in compliance with the provisions of
Rule 144A to a transferee who has signed the certification provided for on
the form of Note stating, or has otherwise advised the Issuer and the
Registrar in writing, that it is purchasing the Note 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 QIB within the meaning of Rule 144A, 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 Issuer as
it has requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is re-
56
-47-
lying upon its foregoing representations in order to claim the
exemption from registration provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member, and the Notes to be
transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in a Global Note, upon receipt by the Registrar of
written instructions given in accordance with the Depository's and the
Registrar's procedures, the Registrar shall reflect on its books and records
the date and an increase in the principal amount of such Global Note in an
amount equal to the principal amount of the Physical Notes to be
transferred, and the Trustee shall cancel the Physical Notes so transferred.
(c) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement Legend
unless (i) the requested transfer is after the second anniversary of the Issue
Date (provided, however, that neither the Issuer nor any Affiliate of the Issuer
has held any beneficial interest in such Note, or portion thereof, at any time
prior to or on the second anniversary of the Issue Date), or (ii) there is
delivered to the Registrar an Opinion of Counsel reasonably satisfactory to the
Issuer and the Trustee to the effect that neither such legend nor the related
restrictions on transfer are required in order to maintain compliance with the
provisions of the Securities Act.
(d) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.16 or this Section 2.17.
The Issuer shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time during the
Registrar's normal business hours upon the giving of reasonable written notice
to the Registrar.
57
-48-
The Trustee shall not be liable for any transfer, exchange or
assignment of a Note by a Holder in violation of any provision of this Indenture
and/or applicable United States federal or state securities law.
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 Note (including any transfers between or among Agent Members or
beneficial owners of interests in any Global Note) 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 terms of,
this Indenture, and to examine the same to determine substantial compliance as
to form with the express requirements hereof.
(e) Transfers of Notes Held by Affiliates. Any certificate (i)
evidencing a Note that has been transferred to an Affiliate of an Issuer within
two years after the Issue Date, as evidenced by a notation on the Assignment
Form for such transfer or in the representation letter delivered in respect
thereof or (ii) evidencing a Note that has been acquired from an Affiliate of
the Issuer (other than by an Affiliate of the Issuer) in a transaction or a
chain of transactions not involving any public offering, shall, until two years
after the last date on which either the Issuer or any Affiliate of the Issuer
was an owner of such Note, in each case, bear a legend in substantially the form
set forth in Section 2.15 hereof, unless otherwise agreed by the Issuer (with
written notice thereof to the Trustee).
SECTION 2.18. Additional Interest Under
Registration Rights Agreement.
Under certain circumstances, the Issuer shall be obligated to pay
Additional Interest to the Holders, all as set forth in Section 4 of the
Registration Rights Agreement. The terms thereof are hereby incorporated herein
by reference. Notwithstanding such incorporation by reference, the Trustee shall
have no duties or obligations under the Registration Rights Agreement. The
Issuer shall notify the Trustee if any Additional Interest is payable on the
Notes.
58
-49-
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Issuer elects to redeem Notes pursuant to Paragraph 6(a) or 6(b)
of the Notes, it shall notify the Trustee and the Paying Agent in writing of the
Redemption Date and the principal amount of the Notes to be redeemed and whether
it wants the Trustee to give notice of redemption to the Holders (at the
Issuer's expense) at least 60 days (unless a shorter notice period shall be
satisfactory to the Trustee) but not more than 90 days before the Redemption
Date. Any such notice may be cancelled at any time prior to notice of such
redemption being mailed to any Holder and shall thereby be void and of no
effect.
SECTION 3.02. Selection of Notes To Be Redeemed.
If fewer than all of the Notes are to be redeemed, selection of the
Notes or portions thereof for redemption shall be made by the Trustee by lot,
pro rata or in such manner as it shall deem appropriate and fair and in such
manner as complies with any applicable legal requirements; provided, however,
that if a partial redemption is made with the proceeds of a Public Equity
Offering, selection is made with the proceeds of a Public Equity Offering,
selection of the Notes or portions thereof for redemption shall be made by the
Trustee only on a pro rata basis, unless such method is otherwise prohibited.
The Trustee shall make the selection from the Notes outstanding and not
previously called for redemption and shall promptly notify the Issuer in writing
of the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Notes in
denominations of $1,000 may be redeemed only in whole. The Trustee may select
for redemption portions (equal to $1,000 or any integral multiple thereof) of
the principal of Notes that have denominations larger than $1,000. Provisions of
this Indenture that apply to Notes called for redemption also apply to portions
of Notes called for redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Issuer shall mail or cause to be mailed at
59
-50-
the last address for such Holder then shown on the registry books a notice of
redemption by first class mail, postage prepaid, to each Holder whose Notes are
to be redeemed, with a copy to the Trustee. At the Issuer's request, the Trustee
shall give the notice of redemption in the Issuer's name and at the Issuer's
expense. Each notice of redemption shall identify the Notes to be redeemed
(including the CUSIP number, if any) and shall state:
(1) the Redemption Date;
(2) the redemption price and the amount of accrued interest, if any, to
be paid (the "Redemption Price");
(3) the name and address of the Paying Agent;
(4) that Notes called for redemption must be surrendered to the Paying
Agent to collect the Redemption Price;
(5) that, unless the Issuer defaults in making the redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
Redemption Date, and the only remaining right of the Holders of such Notes
is to receive payment of the Redemption Price upon surrender to the Paying
Agent of the Notes redeemed;
(6) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the Redemption Date and
upon surrender of such Note, a new Note or Notes in the aggregate principal
amount equal to the unredeemed portion thereof will be issued; and
(7) if fewer than all the Notes are to be redeemed, the identification
of the particular Notes (or portion thereof) to be redeemed, as well as the
aggregate principal amount of Notes to be redeemed and the aggregate
principal amount of Notes to be outstanding after such partial redemption.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03,
Notes called for redemption become due and payable on the Redemption Date and at
the Redemption Price. Upon surrender to the Trustee or Paying Agent, such Notes
called for redemption shall be paid at the Redemption Price.
60
-51-
SECTION 3.05. Deposit of Redemption Price.
Before the Redemption Date, the Issuer shall deposit with the Paying
Agent U.S. Legal Tender sufficient to pay the Redemption Price of all Notes to
be redeemed on that date. The Paying Agent shall promptly return to the Issuer
any U.S. Legal Tender so deposited which is not required for that purpose,
except with respect to monies owed as obligations to the Trustee pursuant to
Article Seven.
On and after any Redemption Date, interest will cease to accrue on the
Notes or parts thereof called for redemption as long as the Issuer has deposited
with the Paying Agent funds in satisfaction of the Redemption Price in
compliance with the preceding paragraph.
SECTION 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is to be redeemed in part, the Trustee
shall authenticate for the Holder a new Note or Notes equal in principal amount
to the unredeemed portion of the Note surrendered.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes.
The Issuer shall pay the principal of and interest on the Notes on the
dates and in the manner provided in the Notes. An installment of principal of or
interest on the Notes shall be considered paid on the date it is due if the
Trustee or Paying Agent holds on that date U.S. Legal Tender designated for and
sufficient to pay the installment. Interest will be computed on the basis of a
360-day year comprised of twelve 30-day months.
SECTION 4.02. Maintenance of Office or Agency.
The Issuer shall maintain the office or agency required under Section
2.03. The Issuer shall give prior notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Issuer
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presenta-
61
-52-
tions, surrenders, notices and demands may be made or served at the address of
the Trustee set forth in Section 13.02.
SECTION 4.03. Corporate Existence.
Except as otherwise permitted by Article Four, Article Five or Section
11.05, the Issuer, Caterair and each other Guarantor that is a Significant
Subsidiary of the Issuer or Caterair shall do or cause to be done all things
reasonably necessary to preserve and keep in full force and effect their
respective corporate or other existence and the corporate or other existence of
each of their respective Significant Subsidiaries in accordance with the
respective organizational documents of each such Significant Subsidiary and the
material rights (charter and statutory) and franchises of the Issuer or
Caterair, as the case may be, and each of their respective Significant
Subsidiaries; provided, however, that the Issuer and Caterair shall not be
required to preserve, with respect to themselves, any material right or
franchise and, with respect to any of their respective Significant Subsidiaries,
any such existence, material right or franchise, if the Board of Directors of
the Issuer, Caterair or such Significant Subsidiary, as the case may be, shall
determine that the preservation thereof is no longer reasonably necessary or
desirable in the conduct of the business of the Issuer, Caterair or any such
Significant Subsidiary.
SECTION 4.04. Payment of Taxes and Other Claims.
Each of the Issuer and Caterair shall pay or discharge or cause to be
paid or discharged, before the same shall become delinquent, (i) all material
taxes, assessments and governmental charges (including withholding taxes and any
penalties, interest and additions to taxes) levied or imposed upon it or any of
its Subsidiaries or properties of it or any of its Subsidiaries and (ii) all
material lawful claims for labor, materials, supplies and services that, if
unpaid, might by law become a Lien upon the property of it or any of its
Subsidiaries; provided, however, that there shall not be required to be paid or
discharged any such tax, assessment, claim or charge, the amount, applicability
or validity of which is being contested in good faith by appropriate proceedings
and for which adequate provision has been made or where the failure to effect
such payment or discharge is not adverse in any material respect to the Holders.
62
-53-
SECTION 4.05. Maintenance of Properties and Insurance.
(a) Each of the Issuer and Caterair shall, and shall cause each of its
Significant Subsidiaries to, maintain its material properties in normal
condition (subject to ordinary wear and tear) and make all reasonably necessary
repairs, renewals or replacements thereto as in the judgment of the Issuer or
Caterair, as the case may be, may be reasonably necessary to the conduct of the
business of the Issuer and its Significant Subsidiaries or Caterair and its
Significant Subsidiaries, as the case may be; provided, however, that nothing in
this Section 4.05 shall prevent the Issuer or any of its Significant
Subsidiaries or Caterair or any of its Significant Subsidiaries, as the case may
be, from discontinuing the operation and maintenance of any of its properties,
if such properties are, in the reasonable and good faith judgment of the Board
of Directors of such Person, no longer reasonably necessary in the conduct of
their respective businesses.
(b) Each of the Issuer and Caterair shall provide or cause to be
provided, for itself and each of its Subsidiaries, insurance (including
appropriate self-insurance) against loss or damage of the kinds that, in the
reasonable, good faith opinion of the Issuer or Caterair, as the case may be,
are reasonably adequate and appropriate for the conduct of the business of the
Issuer and its Subsidiaries or Caterair and its Subsidiaries, as the case may
be.
SECTION 4.06. Compliance Certificate; Notice of Default.
(a) The Issuer shall deliver to the Trustee, within 120 days after the
end of the Issuer's fiscal year, an Officers' Certificate (signed by the
principal executive officer, principal financial officer or principal accounting
officer) stating that a review of its activities and the activities of its
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether it has
kept, observed, performed and fulfilled its obligations under this Indenture and
further stating, as to each such Officer signing such certificate, that to the
best of his knowledge the Issuer during such preceding fiscal year has kept,
observed, performed and fulfilled each and every such obligation and no Default
or Event of Default occurred during such year and at the date of such
certificate there is no Default or Event of Default that has occurred and is
continuing or, if such signers do know of such Default or Event of Default, the
certificate shall describe the Default or Event of Default and its status with
particularity. The Offi-
63
-54-
cers' Certificate shall also notify the Trustee should the Issuer elect to
change the manner in which it fixes its fiscal year end.
(b) Caterair shall deliver to the Trustee, within 120 days after the
end of Caterair's fiscal year, an Officers' Certificate (signed by the principal
executive officer, principal financial officer or principal accounting officer)
stating that a review of its activities and the activities of its Subsidiaries
during the preceding fiscal year has been made under the supervision of the
signing Officers with a view to determining whether it has kept, observed,
performed and fulfilled its obligations under this Indenture and further
stating, as to each such Officer signing such certificate, that to the best of
his knowledge Caterair during such preceding fiscal year has kept, observed,
performed and fulfilled each and every such obligation and no Default or Event
of Default occurred during such year and at the date of such certificate there
is no Default or Event of Default that has occurred and is continuing or, if
such signers do know of such Default or Event of Default, the certificate shall
describe the Default or Event of Default and its status with particularity. The
Officers' Certificate shall also notify the Trustee should Caterair elect to
change the manner in which it fixes its fiscal year end.
(c) The copy of the annual report on Form 10-K of the Issuer as filed
with the SEC or the annual financial statements delivered to the Trustee
pursuant to Section 4.08 shall be accompanied by a written report of the
Issuer's independent accountants that in conducting their audit of the financial
statements which are a part of such annual report or such annual financial
statements nothing has come to their attention that would lead them to believe
that the Issuer has violated any provisions of Article Four, Five or Six of this
Indenture insofar as they relate to accounting matters or, if any such violation
has occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(d) (i) If any Default or Event of Default has occurred and is
continuing or (ii) if any Holder seeks to exercise any remedy hereunder with
respect to a claimed Default under this Indenture or the Notes, the Issuer shall
deliver to the Trustee by registered or certified mail or by facsimile
transmission followed by hard copy by registered or certified mail an Officers'
Certificate specifying such event, notice or
64
-55-
other action within five Business Days of its actual knowledge of such
occurrence.
SECTION 4.07. Compliance with Laws.
The Issuer and each Guarantor shall comply, and shall cause each of
their respective Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America and each
other country in which the Issuer or any Guarantor conducts business, all states
and municipalities thereof, and of any governmental department, commission,
board, regulatory authority, bureau, agency and instrumentality of the
foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except for such noncompliances as are
not in the aggregate reasonably likely to have a material adverse effect on the
financial condition or results of operations of the Issuer and its Subsidiaries,
taken as a whole.
SECTION 4.08. Reports.
The Issuer will deliver to the Trustee within 15 days after the filing
of the same with the SEC, copies of the quarterly and annual reports and of the
information, documents and other reports, if any, which the Issuer is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act.
Notwithstanding that the Issuer may not be subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act, the Issuer will provide the Trustee,
Holders and Qualified Institutional Buyers (as defined in Rule 144A under the
Securities Act) which request such information from the Issuer and indicate a
bona fide interest in purchasing Notes with consolidated financial statements of
the Issuer and a related "Management's Discussion and Analysis of Financial
Condition and Results of Operations" comparable to those which would have been
required to appear in quarterly or annual reports of the Issuer and, to holders
of Transfer Restricted Notes any other information set forth in Rule 144A(d)(4)
or any successor provision under the Act. In addition, the Issuer will provide
the Trustee and Holders with unaudited combined financial data of the Issuer and
the Guarantors, substantially in the form provided under the caption "Summary --
Summary Unaudited Pro Forma Financial Data" (excluding the information under the
caption "Operating Statistics") in the Offering Memorandum, for each fiscal year
of the Issuer and for the first three fiscal quarters of each fiscal year of the
Issuer. Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall
65
-56-
not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Issuer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates). The Issuer will also
comply with the other provisions of TIA Section 314(a).
SECTION 4.09. Waiver of Stay, Extension or Usury Laws.
The Issuer covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Issuer from paying all or any
portion of the principal of or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which may affect the
obligations or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Issuer hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
SECTION 4.10. Limitation on Restricted Payments.
The Issuer shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, (a) declare or pay any
dividend or make any distribution (other than dividends or distributions payable
in Qualified Capital Stock of the Issuer) on or in respect of shares of the
Issuer's Capital Stock to holders of such Capital Stock, (b) purchase, redeem or
otherwise acquire or retire for value any Capital Stock of the Issuer or any
warrants, rights or options to purchase or acquire shares of any class of such
Capital Stock, other than the exchange of such Capital Stock or any warrants,
rights or options to acquire shares of any class of such Capital Stock for
Qualified Capital Stock of the Issuer or warrants, rights or options to acquire
such Qualified Capital Stock, (c) make any principal payment on, purchase,
defease, redeem, prepay, decrease or otherwise acquire or retire for value,
prior to any scheduled final maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness of the Issuer or its Restricted Subsidiaries that
is subordinate or junior in right of payment to the Notes, or (d) make any
Investment (other than Permitted Investments) (each of the foregoing actions set
forth in clauses (a), (b), (c) and (d) being referred to as a "Restricted
Payment"), if at the time of such
66
-57-
Restricted Payment or immediately after giving effect thereto, (i) a Default or
an Event of Default shall have occurred and be continuing, (ii) the Issuer is
not able to incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) in compliance with Section 4.12, or (iii) the aggregate
amount of Restricted Payments made subsequent to the Issue Date (the amount
expended for such purposes, if other than in cash, being the fair market value
of such property as determined by the Board of Directors of the Issuer in good
faith) shall exceed the sum of: (x) 50% of the cumulative Consolidated Net
Income (or if cumulative Consolidated Net Income shall be a loss, minus 100% of
such loss) of the Issuer earned subsequent to the Issue Date and on or prior to
the date the Restricted Payment occurs (the "Reference Date") (treating such
period as a single accounting period); plus (y) 100% of the aggregate Net Cash
Proceeds received by the Issuer from any Person (other than a Subsidiary of the
Issuer) from the issuance and sale subsequent to the Issue Date and on or prior
to the Reference Date of Qualified Capital Stock of the Issuer (including
proceeds from the issuance and sale of any securities of the Issuer convertible
into or exchangeable for Qualified Capital Stock of the Issuer to the extent
such securities are so converted or exchanged and including any additional
proceeds received by the Issuer upon such conversion or exchange); plus (z)
without duplication of any amounts included in clause (iii)(y) above, 100% of
the aggregate Net Cash Proceeds received by the Issuer as capital contributions
subsequent to the Issue Date and on or prior to the Reference Date.
Notwithstanding the foregoing, the provisions set forth in the
immediately preceding paragraph do not prohibit: (1) the payment of any dividend
or the consummation of any irrevocable redemption within 60 days after the date
of declaration of such dividend or notice of such redemption if the dividend or
payment of the redemption price, as the case may be, would have been permitted
on the date of declaration or notice; (2) the acquisition of any shares of
Capital Stock of the Issuer or warrants, options or other rights to acquire
Capital Stock of the Issuer, either (i) solely in exchange for shares of
Qualified Capital Stock of the Issuer or warrants, options or other rights to
acquire such Qualified Capital Stock, or (ii) through the application of the net
proceeds of a substantially concurrent sale for cash (other than to a Subsidiary
of the Issuer) of shares of Qualified Capital Stock of the Issuer or warrants,
options or other rights to acquire such Qualified Capital Stock; (3) the
acquisition of Indebtedness of the Issuer that is subordinate or junior in right
of payment to the Notes, either (i) solely in exchange for shares of Qualified
67
-58-
Capital Stock of the Issuer or warrants, options or other rights to acquire such
Qualified Capital Stock or for Indebtedness of the Issuer which is subordinate
or junior in right of payment to the Notes, at least to the extent that the
Indebtedness being acquired is subordinated to the Notes, and has a Weighted
Average Life to Maturity no less than that of the Indebtedness being acquired or
(ii) through the application of the net proceeds of a substantially concurrent
sale for cash (other than to a Subsidiary of the Issuer) of shares of Qualified
Capital Stock of the Issuer or warrants, options or other rights to acquire such
Qualified Capital Stock or Indebtedness of the Issuer which is subordinate or
junior in right of payment to the Notes, at least to the extent that the
Indebtedness being acquired is subordinated to the Notes, and has a Weighted
Average Life to Maturity no less than that of the Indebtedness being refinanced;
(4) payments by the Issuer to OFSI to enable OFSI to pay a dividend to
LSG/Lufthansa (or a Subsidiary thereof), in an aggregate amount not to exceed
$2.5 million in any 12-month period; provided that any unused portion of such
amount may be carried over to any subsequent 12-month period; (5) payments by
the Issuer to OFSI on or after January 1, 1997 to enable OFSI to pay dividends
to stockholders of OFSI other than LSG/Lufthansa (or a Subsidiary thereof), in
an amount not to exceed $6 million in any 12-month period; provided that any
unused portion of such amount may be carried over to any subsequent 12-month
period; (6) payments by the Issuer or any of its Subsidiaries to OFSI pursuant
to the OFSI Tax Sharing Agreement; (7) payments by the Issuer to OFSI sufficient
to enable OFSI to (i) pay franchise taxes and other fees and expenses necessary
to maintain its corporate existence, (ii) pay reasonable fees to its directors
and (iii) perform accounting, legal, corporate reporting and administrative
functions in the ordinary course of business, other than those functions which
are related exclusively to OFSI's investments in Persons other than the Issuer
and Subsidiaries of the Issuer; (8) payments by the Issuer or any of its
Subsidiaries to OFSI in an aggregate amount not to exceed $6 million in any
12-month period, the proceeds of which are used by OFSI to repurchase
outstanding shares of OFSI's common stock from current or former employees or
directors of the Issuer or any of its Subsidiaries (A) following the death,
disability or termination of any such person or (B) pursuant to one or more
written plans approved by the Board of Directors of OFSI; and (9) payments by
the Issuer or any of its Subsidiaries to OFSI, the proceeds of which are used by
OFSI to fund payments under a plan implemented to compensate management of the
Issuer and its Subsidiaries based on the value of OFSI's common stock; provided,
however, that in the case of clauses (4), (5) and (8)(B), no Default or Event of
68
-59-
Default shall have occurred or be continuing at the time of such payment or as a
result thereof. In determining the aggregate amount of Restricted Payments made
subsequent to the Issue Date in accordance with clause (iii) of the immediately
preceding paragraph, (x) 100% of each of the payments described in clauses (1),
(4) and (5) above (to the extent such expenditure is in the form of cash) and
(y) 50% of the payments described in clauses (8)(A) and (8)(B) above (to the
extent such expenditure is in the form of cash), other than amounts paid to the
Issuer or a Subsidiary of the Issuer by OFSI or such employee in satisfaction of
loans or advances made by the Issuer or such Subsidiary pursuant to clause (v)
(A) of the definition of "Permitted Investments" (which shall not be included in
such calculation or in the calculation of payments made pursuant to clause (8)),
shall be included in such calculation.
Caterair shall not, and shall not cause or permit any of its
Subsidiaries to, directly or indirectly, (a) declare or pay any dividend or make
any distribution on or in respect of shares of Caterair's Capital Stock to
holders of such Capital Stock, (b) purchase, redeem or otherwise acquire or
retire for value any Capital Stock of Caterair or any warrants, rights or
options to purchase or acquire shares of any class of such Capital Stock, (c)
make any principal payment on, purchase, defease, redeem, prepay, decrease or
otherwise acquire or retire for value, prior to any scheduled final maturity,
scheduled repayment or scheduling sinking fund payment, any Indebtedness of
Caterair or its Subsidiaries that is subordinate or junior in right of payment
to the Notes, or (d) make any Investment (other than Permitted Investments)
(each of the foregoing actions set forth in clauses (a), (b), (c) and (d) being
referred to as a "Caterair Restricted Payment").
Notwithstanding the foregoing, the provisions set forth in the
immediately preceding paragraph do not prohibit: (1) the payment of any dividend
within 30 days after the date of declaration of such dividend if the dividend
would have been permitted on the date of declaration; (2) payments by Caterair
to Caterair Holdings sufficient to enable Caterair Holdings to (i) pay franchise
taxes and other fees and expenses necessary to maintain its corporate existence,
(ii) pay reasonable fees to its directors and (iii) perform accounting, legal,
corporate reporting and administrative functions in the ordinary course of
business; (3) payments by Caterair or any of its Subsidiaries to Caterair
Holdings pursuant to the Caterair Tax Sharing Agreement; and (4) payments by
Caterair or any Subsidiary of Caterair to the Issuer or any Restricted
Subsidiary of the Issuer.
69
-60-
SECTION 4.11. Limitation on Transactions with Affiliates.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction or series of related transactions (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with, or for the benefit of, any of its Affiliates (an "Affiliate
Transaction"), other than (x) Affiliate Transactions permitted under the
paragraph below and (y) Affiliate Transactions on terms that are no less
favorable than those that might reasonably have been obtained in a comparable
transaction at such time on an arm's-length basis from a Person that is not an
Affiliate; provided, however, that for a transaction or series of related
transactions with an aggregate value of $5 million or more (i) such
determination shall be made in good faith by a majority of the disinterested
members of the Board of the Directors of the Issuer or (ii) the Board of
Directors of the Issuer shall have received an opinion from a nationally
recognized investment banking firm that such Affiliate Transaction is on terms
no less favorable than those that might reasonably have been obtained in a
comparable transaction at such time on an arm's-length basis from a Person that
is not an Affiliate; and provided, further, that for a transaction or series of
related transactions with an aggregate value of $10 million or more, the Board
of Directors of the Issuer shall have received an opinion from a nationally
recognized investment banking firm that such Affiliate Transaction is on terms
no less favorable than those that might reasonably have been obtained in a
comparable transaction at such time on an arm's-length basis from a Person that
is not an Affiliate.
The restrictions set forth in the preceding paragraph shall not apply
to (1) reasonable fees and compensation paid to and indemnity provided on behalf
of, officers, directors, employees or consultants of the Issuer or any
Subsidiary of the Issuer as determined in good faith by the Issuer's Board of
Directors or senior management; (2) transactions between or among the Issuer or
any Restricted Subsidiary of the Issuer, on the one hand, and any Subsidiary of
the Issuer or other Person controlled (as such term is defined in the definition
of "Affiliate") by the Issuer, on the other hand, so long as no portion of the
remaining interest in such Subsidiary or other Person is owned by a Person who
controls (as such term is defined in the definition of "Affiliate") the Issuer,
or between or among such Subsidiaries and Persons, provided such transactions
are not otherwise prohibited by this Indenture; (3) any agreement as in effect
as of the Issue Date or any amendment
70
-61-
thereto or any transaction contemplated thereby (including pursuant to any
amendment thereto) in any replacement agreement thereto so long as any such
amendment or replacement agreement is not more disadvantageous to the Holders in
any material respect than the original agreement as in effect on the Issue Date;
(4) transactions between the Issuer or any Restricted Subsidiary of the Issuer,
on the one hand, and Caterair or any Subsidiary of Caterair, on the other hand;
and (5) Restricted Payments permitted by this Indenture.
Caterair will not, and will not permit any of its Subsidiaries to,
directly or indirectly, enter into or permit to exist any transaction or series
of related transactions (including, without limitation, the purchase, sale,
lease or exchange of any property or the rendering of any service) with, or for
the benefit of, any of its Affiliates.
The restrictions set forth in the preceding paragraph shall not apply
to (1) transactions between Caterair or any Subsidiary of Caterair, on the one
hand, and the Issuer or any Restricted Subsidiary of the Issuer, on the other
hand; (2) transactions between or among Caterair or any Subsidiary of Caterair,
on the one hand, and any Subsidiary of Caterair or other Person controlled (as
such term is defined in the definition of "Affiliate") by Caterair, on the other
hand, so long as no portion of the remaining interest in such Subsidiary or
other Person is owned by a Person who controls (as such term is defined in the
definition of "Affiliate") Caterair, or between or among such Subsidiaries and
Persons, provided such transactions are not otherwise prohibited by this
Indenture; (3) reasonable fees and compensation paid to and indemnity provided
on behalf of, officers, directors, employees or consultants of Caterair or any
Subsidiary of Caterair as determined in good faith by Caterair's Board of
Directors or senior management; (4) any agreement as in effect as of the Issue
Date or any amendment thereto or any transaction contemplated thereby (including
pursuant to any amendment thereto) in any replacement agreement thereto so long
as any such amendment or replacement agreement is not more disadvantageous to
the Holders in any material respect than the original agreement as in effect on
the Issue Date; and (5) Caterair Restricted Payments permitted by this
Indenture.
SECTION 4.12. Limitation on Incurrence of Additional Indebtedness.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, and Caterair shall not, and shall
71
-62-
not permit any of its Subsidiaries to, directly or indirectly, create, incur,
assume, guarantee, acquire, become liable, contingently or otherwise, with
respect to, or otherwise become responsible for payment of (collectively,
"incur") any Indebtedness (other than Permitted Indebtedness); provided,
however, that if no Default or Event of Default shall have occurred and be
continuing at the time or as a consequence of the incurrence of any such
Indebtedness, the Issuer, Caterair or any Restricted Subsidiary of the Issuer
may incur Indebtedness if on the date of the incurrence of such Indebtedness,
after giving effect to the incurrence thereof, the Consolidated Fixed Charge
Coverage Ratio of the Issuer is greater than 2.00 to 1.0.
SECTION 4.13. Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or permit to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Issuer to (a) pay dividends or make any other
distributions on or in respect of its Capital Stock; (b) make loans or advances
to or pay any Indebtedness or other obligation owed to the Issuer or any other
Restricted Subsidiary of the Issuer; or (c) transfer any of its property or
assets to the Issuer or any other Restricted Subsidiary of the Issuer, except
for such encumbrances or restrictions existing under or by reason of: (1)
applicable law; (2) this Indenture; (3) customary non-assignment provisions of
any contract or any lease entered into in the ordinary course of business; (4)
any agreement or instrument governing Acquired Indebtedness, which encumbrance
or restriction is not applicable to any Person, or the properties or assets of
any Person, other than the Person or the properties or assets of the Person so
acquired; (5) any agreement existing on the Issue Date (including, without
limitation, the Senior Bank Financing); (6) in the case of clause (c) above, (A)
restrictions on the transfer of assets subject to any Lien permitted under this
Indenture imposed by the holder of such Lien and (B) restrictions on the
transfer of assets imposed by any agreement, lease or permit entered into or
obtained in the ordinary course of business in connection with the operation of
flight kitchens; (7) (A) restrictions imposed by any agreement to sell assets
permitted under this Indenture to any Person pending the closing of such sale,
(B) any agreement or instrument governing Capital Stock of any Person that is
acquired or (C) any joint venture, stockholder or similar agreements; (8)
encumbrances and restrictions imposed by any agreement or instrument governing
Indebtedness (including any
72
-63-
collateral or related documents) of any Restricted Subsidiary of the Issuer
conducting substantially all of its business outside the United States;
provided, however, that such Restricted Subsidiaries of the Issuer, in the
aggregate, did not account for more than 10% of Consolidated EBITDA of the
Issuer (after giving pro forma effect to inclusion of any additional Restricted
Subsidiary proposing to enter into such an agreement or instrument) during the
four full fiscal quarter period ending immediately prior to the date of
determination thereof; or (9) an agreement effecting an amendment, refinancing,
replacement or substitution of Indebtedness issued, assumed or incurred pursuant
to an agreement referred to in clause (2), (4) or (5) above or any other
agreement evidencing Indebtedness permitted under this Indenture; provided,
however, that the provisions relating to such encumbrance or restriction
contained in any such amendment, refinancing, replacement or substitution
agreement or any such other agreement are not less favorable to the Issuer in
any material respect as determined by the Board of Directors of the Issuer than
the provisions relating to such encumbrance or restriction contained in
agreements referred to in such clause (2), (4) or (5).
Caterair shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause or permit to exist or become
effective any encumbrance or restriction on the ability of any Subsidiary of
Caterair to (a) pay dividends or make any other distributions on or in respect
of its Capital Stock; (b) make loans or advances or to pay any Indebtedness or
other obligation owed to Caterair or any other Subsidiary of Caterair; or (c)
transfer any of its property or assets to Caterair or any other Subsidiary of
Caterair, except for such encumbrances or restrictions existing under or by
reason of: (1) applicable law; (2) this Indenture; (3) customary non-assignment
provisions of any contract or any lease entered into in the ordinary course of
business; (4) any agreement or instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the properties or
assets of any Person, other than the Person or the properties or assets of the
Person so acquired; (5) any agreement existing on the Issue Date (including,
without limitation, the Senior Bank Financing); (6) in the case of clause (c)
above, (A) restrictions on the transfer of assets subject to any Lien permitted
under this Indenture imposed by the holder of such Lien and (B) restrictions on
the transfer of assets imposed by any agreement, lease or permit entered into or
obtained in the ordinary course of business in connection with the operation of
flight kitchens; (7) restrictions imposed by any agreement to sell assets
permitted under this Indenture to
73
-64-
any Person pending the closing of such sale; or (8) an agreement effecting an
amendment, a refinancing, replacement or substitution of Indebtedness issued,
assumed or incurred pursuant to an agreement referred to in clause (2), (4) or
(5) above; provided, however, that the provisions relating to such encumbrance
or restriction contained in any such amendment, refinancing, replacement or
substitution agreement are not less favorable to Caterair in any material
respect as determined by the Board of Directors of Caterair than the provisions
relating to such encumbrance or restriction contained in agreements referred to
in such clause (2), (4) or (5).
SECTION 4.14. Prohibition on Incurrence of
Senior Subordinated Debt.
Neither the Issuer nor any Guarantor will, directly or indirectly,
incur any Indebtedness (including Acquired Indebtedness) that is senior in right
of payment to the Notes or its Guarantee, as the case may be, and expressly
subordinate in right of payment to any other Indebtedness of the Issuer or such
Guarantor, as the case may be.
SECTION 4.15. Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder can require
the Issuer to repurchase all or a portion of such Holder's Notes pursuant to the
offer described in paragraph (b) below (the "Change of Control Offer"), at a
purchase price equal to 101% of the principal amount thereof plus accrued
interest, if any, to the date of repurchase. Prior to the mailing of the notice
referred to below, but in any event within 30 days following the date on which a
Change of Control occurs, the Issuer covenants to (i) repay in full all
Indebtedness under the Senior Bank Financing (and terminate all commitments
thereunder) and all such other Senior Debt the terms of which require repayment
upon a Change of Control or Change of Control Offer and terminate the
commitments of each holder of such other Senior Debt that has accepted such
offer or (ii) obtain the requisite consents under the Senior Bank Financing and
all such other Senior Debt to permit the repurchase of the Notes as provided
below. The Issuer shall first comply with the covenant in the immediately
preceding sentence before it shall be required to repurchase Notes pursuant to
the provisions described in this Section 4.15; provided that the Issuer's
failure to comply with such covenant resulting in a failure to mail the notice
referred to below shall constitute an Event of Default under Section 6.01(3) and
not under Section 6.01(2).
74
-65-
(b) Within 30 days following the date upon which a Change of Control
occurs (the "Change of Control Date"), the Issuer shall send, by first class
mail, a notice to each Holder of Notes, with a copy to the Trustee, which notice
shall govern the terms of the Change of Control Offer. The notice to the Holders
shall contain all instructions and materials necessary to enable such Holders to
tender Notes pursuant to the Change of Control Offer. Such notice shall state:
(1) that the Change of Control Offer is being made pursuant to this
Section 4.15 and that all Notes validly tendered and not withdrawn will be
accepted for payment;
(2) the repurchase price (including the amount of accrued interest, if
any) and the repurchase date (which shall be no earlier than 30 days nor
later than 45 days from the date such notice is mailed, other than as may be
required by law) (the "Change of Control Payment Date");
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Issuer defaults in making payment therefor, any
Note accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have a Note purchased pursuant to a Change
of Control Offer will be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, to the Paying Agent at the address specified in the notice prior
to the close of business on the third Business Day prior to the Change of
Control Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than five Business Days prior to the Change
of Control Payment Date, a facsimile transmission or letter setting forth
the name of the Holder, the principal amount of the Notes the Holder
delivered for purchase and a statement that such Holder is withdrawing his
election to have such Note purchased;
(7) that Holders whose Notes are purchased only in part will be issued
new Notes in a principal amount equal to the unpurchased portion of the
Notes surrendered; and
75
-66-
(8) the circumstances and relevant facts regarding such Change of
Control.
(c) On or before the Change of Control Payment Date, the Issuer shall
(i) accept for payment Notes or portions thereof (in integral multiples of
$1,000) validly tendered pursuant to the Change of Control Offer, (ii) deposit
with the Paying Agent U.S. Legal Tender sufficient to pay the purchase price of
all Notes so tendered and (iii) deliver to the Trustee Notes so accepted
together with an Officers' Certificate stating the Notes or portions thereof
being purchased by the Issuer. The Paying Agent shall promptly mail to the
Holders of Notes so accepted payment in an amount equal to the purchase price
out of the funds deposited with the Paying Agent in accordance with the
preceding sentence. The Trustee shall promptly authenticate and mail to such
Holders new Notes equal in principal amount to any unpurchased portion of the
Notes surrendered. Upon the payment of the purchase price for the Notes accepted
for purchase, the Trustee shall return the Notes purchased to the Issuer for
cancellation. Any amounts remaining after the purchase of Notes pursuant to a
Change of Control Offer shall be returned by the Trustee to the Issuer.
(d) The Issuer will comply with the requirements of Rule 14e-1 under
the Exchange Act and any other Notes laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Notes pursuant to a Change of Control Offer. To the extent the
provisions of any such rule conflict with the provisions of this Indenture
relating to a Change of Control Offer, the Issuer shall comply with the
provisions of such rule and be deemed not to have breached its obligations
relating to such Change of Control Offer by virtue thereof.
SECTION 4.16. Limitation on Asset Sales.
(a) The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) other than with respect to
the Australian Assets, the Issuer or the applicable Restricted Subsidiary, as
the case may be, receives consideration at the time of such Asset Sale at least
equal to the fair market value of the assets sold or otherwise disposed of (as
determined in good faith by the Issuer's Board of Directors); (ii) at least 75%
of the consideration received by the Issuer or such Restricted Subsidiary, as
the case may be, from such Asset Sale shall be cash or Cash Equivalents and is
received at the time of such disposition; and (iii) upon the consummation of an
Asset Sale, the Issuer shall apply, or
76
-67-
cause such Restricted Subsidiary to apply, the Net Cash Proceeds relating to
such Asset Sale within 365 days of receipt thereof either (A) to prepay (or, in
the case of letters of credit or Eurodollar loans under the Senior Bank
Financing, cash collateralize) any Senior Debt or Guarantor Senior Debt or, in
the case of any Senior Debt or Guarantor Senior Debt under any revolving credit
facility, effect a permanent reduction in the availability under such revolving
credit facility, (B) to reinvest in Productive Assets, or (C) a combination of
prepayment, reduction and investment permitted by the foregoing clauses (iii)(A)
and (iii)(B). On the 366th day after an Asset Sale or such earlier date, if any,
as the Board of Directors of the Issuer or of such Restricted Subsidiary
determines not to apply the Net Cash Proceeds relating to such Asset Sale as set
forth in clauses (iii)(A), (iii)(B) and/or (iii)(C) of the next preceding
sentence (each, a "Net Proceeds Offer Trigger Date"), such aggregate amount of
Net Cash Proceeds which have not been applied on or before such Net Proceeds
Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and/or (iii)(C) of
the next preceding sentence (each, a "Net Proceeds Offer Amount") shall be
applied by the Issuer or such Restricted Subsidiary to make an offer to
repurchase (the "Net Proceeds Offer") on a date not less than 30 nor more than
45 days following the applicable Net Proceeds Offer Trigger Date, from all
Holders on a pro rata basis that amount of Notes equal to the excess, if any, of
(x) the Net Proceeds Offer Amount over (y) the amount of any such Net Cash
Proceeds required to be used by the Issuer or such Restricted Subsidiary to
repurchase any senior subordinated Indebtedness of the Issuer outstanding on the
Issue Date (other than Indebtedness evidenced by the Notes) at a price equal to
100% of the principal amount of the Notes to be repurchased, plus accrued
interest to the date of repurchase; provided, however, that if at any time any
non-cash consideration received by the Issuer or any Restricted Subsidiary of
the Issuer, as the case may be, in connection with any Asset Sale is converted
into or sold or otherwise disposed of for cash, then such conversion or
disposition shall be deemed to constitute an Asset Sale hereunder and the Net
Cash Proceeds thereof shall be applied in accordance with this Section 4.16.
(b) Notwithstanding Section 4.16(a), if a Net Proceeds Offer Amount is
less than $10 million, the application of the Net Cash Proceeds constituting
such Net Proceeds Offer Amount to a Net Proceeds Offer may be deferred until
such time as such Net Proceeds Offer Amount plus the aggregate amount of all Net
Proceeds Offer Amounts arising subsequent to the Net Proceeds Offer Trigger Date
relating to such initial Net Proceeds Offer Amount from all Asset Sales by the
Issuer and its
77
-68-
Restricted Subsidiaries aggregates at least $10 million, at which time the
Issuer or such Restricted Subsidiary shall apply all Net Cash Proceeds
constituting all Net Proceeds Offer Amounts that have been so deferred to make a
Net Proceeds Offer (the first date the aggregate of all such deferred Net
Proceeds Offer Amounts is equal to $10 million or more shall be deemed to be a
"Net Proceeds Offer Trigger Date").
(c) Notwithstanding Sections 4.16(a) and (b) the two immediately
preceding paragraphs, the Issuer and its Restricted Subsidiaries will be
permitted to consummate an Asset Sale without complying with Sections (a) and
(b) of this Section 4.16 to the extent (i) at least 75% of the consideration for
such Asset Sale constitutes Productive Assets and (ii) such Asset Sale is for
fair market value (as determined in good faith by the Board of Directors of the
Issuer); provided that the Net Cash Proceeds, if any, received by the Issuer or
any of its Restricted Subsidiaries in connection with any Asset Sale permitted
to be consummated under this Section 4.16(c) shall constitute Net Cash Proceeds
subject to the provisions of Sections (a) and (b) of this Section 4.16.
(d) Caterair shall not, and shall not permit any of its Subsidiaries
to, consummate a Caterair Asset Sale unless (i) Caterair or the applicable
Subsidiary, as the case may be, receives consideration at the time of such
Caterair Asset Sale at least equal to the fair market value of the assets sold
or otherwise disposed of (as determined in good faith by Caterair's Board of
Directors); (ii) at least 75% of the consideration received by Caterair or such
Subsidiary, as the case may be, from such Caterair Asset Sale shall be cash or
Cash Equivalents and is received at the time of such disposition; and (iii) upon
the consummation of a Caterair Asset Sale, Caterair shall apply, or cause such
Subsidiary to apply, the Net Cash Proceeds relating to such Caterair Asset Sale
within 365 days of receipt thereof either (A) to prepay any Guarantor Senior
Debt or, in the case of any Guarantor Senior Debt under any revolving credit
facility, effect a permanent reduction in the availability under such revolving
credit facility, or, if there is no Guarantor Senior Debt outstanding, to prepay
Senior Debt or, in the case of any Senior Debt under any revolving credit
facility, effect a permanent reduction in the availability under such revolving
credit facility, (B) to repay the Caterair Promissory Note; provided that the
Issuer treats the proceeds received from such repayment as proceeds of an Asset
Sale by the Issuer in compliance with Section 4.16(a) of this Indenture, (C) to
reinvest in Productive Assets, or (D) a combination of prepayment, repayment,
reduction and investment permit-
78
-69-
xxx by the foregoing clauses (iii)(A), (iii)(B) and (iii)(C). On the 366th day
after a Caterair Asset Sale or such earlier date, if any, as the Board of
Directors of Caterair or of such Subsidiary determines not to apply the Net Cash
Proceeds relating to such Caterair Asset Sale as set forth in clause (iii) of
the next preceding sentence (each, a "Caterair Net Proceeds Offer Trigger
Date"), such aggregate amount of Net Cash Proceeds which have not been applied
on or before such Caterair Net Proceeds Offer Trigger Date as permitted in
clauses (iii)(A), (iii)(B), (iii)(C) and/or (iii)(D) of the next preceding
sentence (each, a "Caterair Net Proceeds Offer Amount") shall be applied by
Caterair or such Subsidiary to make an offer to repurchase (the "Caterair Net
Proceeds Offer") on a date not less than 30 nor more than 45 days following the
applicable Caterair Net Proceeds Offer Trigger Date, from all Holders on a pro
rata basis that amount of Notes equal to the excess, if any, of (x) the Caterair
Net Proceeds Offer Amount over (y) the amount of any such Net Cash Proceeds
required to be used by Caterair to repurchase any senior subordinated
Indebtedness of the Issuer outstanding on the Issue Date (other than the
Indebtedness evidenced by the Notes) at a price equal to 100% of the principal
amount of the Notes to be repurchased, plus accrued interest to the date of
repurchase; provided, however, that if at any time any non-cash consideration
received by Caterair or any Subsidiary of Caterair, as the case may be, in
connection with any Caterair Asset Sale is converted into or sold or otherwise
disposed of for cash, then such conversion or disposition shall be deemed to
constitute a Caterair Asset Sale hereunder and the Net Cash Proceeds thereof
shall be applied in accordance with this Section 4.16. Caterair shall not resell
or otherwise dispose of any Notes repurchased pursuant to a Caterair Net
Proceeds Offer, other than to the Issuer for cancellation.
(e) Subject to the deferral right set forth in Section 4.16(b), the
Issuer or Caterair, as applicable, shall mail a notice of each Net Proceeds
Offer or Caterair Net Proceeds Offer, as the case may be, to the record Holders
as shown on the register of Holders within 25 days following the Net Proceeds
Offer Trigger Date or Caterair Net Proceeds Offer Trigger Date, as the case may
be, with a copy to the Trustee. The notice shall contain all instructions and
materials necessary to enable such Holders to tender Notes pursuant to the Net
Proceeds Offer or Caterair Net Proceeds Offer, as the case may be, and shall
state the following terms:
(1) that the Net Proceeds Offer or Caterair Net Proceeds Offer, as the
case may be, is being made pursuant to Section 4.16 of this Indenture and
that Holders of Notes
79
-70-
may elect to tender their Notes in whole or in part in integral
multiples of $1,000 and that all Notes validly tendered will be accepted for
payment; provided, however, that if the aggregate principal amount of Notes
tendered in a Net Proceeds Offer or Caterair Net Proceeds Offer, as the case
may be, plus accrued interest at the expiration of such offer exceeds the
aggregate amount of the Net Proceeds Offer or Caterair Net Proceeds Offer,
as the case may be, the Issuer or Caterair, as the case may be, shall select
the Notes to be purchased on a pro rata basis (based upon the principal
amount tendered);
(2) the purchase price (including the amount of accrued interest) and
the purchase date (which shall be no earlier than 30 days nor later than 45
days from the date such notice is mailed, other than as may be required by
law) (the "Proceeds Purchase Date");
(3) that any Note not tendered will continue to accrue interest;
(4) that (a) in the case of a Net Proceeds Offer, unless the Issuer
defaults in making payment therefor, any Note accepted for payment pursuant
to the Net Proceeds Offer shall cease to accrue interest after the Proceeds
Purchase Date, or (b) in the case of a Caterair Net Proceeds Offer, unless
Caterair defaults in making payment therefor, any Note accepted for payment
pursuant to the Caterair Net Proceeds Offer shall be deemed to be
transferred to Caterair on the Proceeds Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to a Net
Proceeds Offer or Caterair Net Proceeds Offer, as the case may be, will be
required to surrender the Note, with the form entitled "Option of Holder to
Elect Purchase" on the reverse of the Note completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the
Business Day prior to the Proceeds Purchase Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than five Business Days prior to the
Proceeds Purchase Date, a facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Notes the Holder delivered
for purchase and a statement that such Holder is withdrawing his election to
have such Note purchased;
80
-71-
(7) that Holders whose Notes are purchased only in part will be issued
new Notes in a principal amount equal to the unpurchased portion of the
Notes surrendered; and
(8) the circumstances and relevant facts regarding such Net Proceeds
Offer or Caterair Net Proceeds Offer, as the case may be.
(f) Upon receiving notice of the Net Proceeds Offer or Caterair Net
Proceeds Offer, as the case may be, Holders may elect to tender their Notes in
whole or in part in integral multiples of $1,000 in exchange for cash. To the
extent Holders properly tender Notes in an amount exceeding the Net Proceeds
Offer Amount or Caterair Net Proceeds Offer Amount, as the case may be, Notes of
tendering Holders will be repurchased on a pro rata basis (based on amounts
tendered). A Net Proceeds Offer or Caterair Net Proceeds Offer, as the case may
be, shall remain open for a period of 20 business days or such longer period as
may be required by law.
(g) On or before the Proceeds Purchase Date, the Issuer or Caterair, as
the case may be, shall (i) accept for payment Notes or portions thereof validly
tendered pursuant to the Net Proceeds Offer or Caterair Net Proceeds Offer, as
the case may be, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient
to pay the purchase price of all Notes so tendered and (iii) deliver to the
Trustee Notes so accepted together with an Officers' Certificate stating the
Notes or portions thereof being purchased by the Issuer or Caterair, as the case
may be. The Paying Agent shall promptly mail to the Holders of Notes so accepted
payment in an amount equal to the purchase price out of funds deposited with the
Paying Agent in accordance with the preceding sentence. The Trustee shall
promptly authenticate and mail to such Holders new Notes equal in principal
amount to any unpurchased portion of the Notes surrendered. Upon payment of the
purchase price for the Notes accepted for purchase, the Trustee shall, (i) in
the case of a Net Proceeds Offer, return the Notes purchased to the Issuer for
cancellation, or (ii) in the case of a Caterair Net Proceeds Offer, (A) send the
Notes purchased to Caterair and (B) instruct the Registrar that such Notes shall
be transferred to Caterair pursuant to Section 2.06. Any Notes not so accepted
shall be promptly mailed by the Issuer or Caterair, as the case may be, to the
Holder thereof.
(h) If the aggregate principal amount of Notes validly tendered
pursuant to any Net Proceeds Offer or Caterair Net Proceeds Offer is less than
the amount of Net Cash Proceeds
81
-72-
subject to such Net Proceeds Offer or Caterair Net Proceeds Offer, the Issuer or
Caterair, as the case may be, may use any remaining portion of such Net Cash
Proceeds not required to fund the repurchase of tendered Notes for purposes
otherwise permitted by this Indenture. Upon the consummation of any Net Proceeds
Offer or Caterair Net Proceeds Offer, as the case may be, the amount of Net Cash
Proceeds subject to any future Net Proceeds Offer or Caterair Net Proceeds
Offer, as the case may be, from the Asset Sales or Caterair Asset Sales, as the
case may be, giving rise to such Net Cash Proceeds shall be deemed to be zero.
(i) The Issuer or Caterair, as the case may be, shall comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and regulations are
applicable in connection with the repurchase of Notes pursuant to a Net Proceeds
Offer or Caterair Net Proceeds Offer, as the case may be. To the extent that the
provisions of any securities laws or regulations conflict with this Section
4.16, the Issuer or Caterair, as the case may be, shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section 4.16 by virtue thereof.
SECTION 4.17. Limitation on Preferred Stock of
Subsidiaries.
The Issuer shall not permit any of its Restricted Subsidiaries to issue
any Preferred Stock to any Person or permit any Person to own any Preferred
Stock of a Restricted Subsidiary of the Issuer, unless the Issuer's percentage
interest in the Preferred Stock of such Restricted Subsidiary is equal to or
greater than the Issuer's percentage interest in the common equity of such
Restricted Subsidiary.
Caterair shall not permit any of its Subsidiaries to issue any
Preferred Stock (other than to the Issuer, a Wholly Owned Restricted Subsidiary
of the Issuer, Caterair or a Wholly Owned Subsidiary of Caterair) or permit any
Person (other than the Issuer, a Wholly Owned Restricted Subsidiary of the
Issuer, Caterair or a Wholly Owned Subsidiary of Caterair) to own any Preferred
Stock of any Subsidiary of Caterair.
SECTION 4.18. Limitation on Liens.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, create, incur, assume or suffer to
82
-73-
exist any Liens of any kind against or upon any of its property or assets, or
any proceeds therefrom, except for (A) Liens securing Senior Debt and/or
Guarantor Senior Debt and (B) Permitted Liens, unless (i) in the case of Liens
securing Indebtedness that is expressly subordinate or junior in right of
payment to the Notes, the Notes are secured by a Lien on such property, assets
or proceeds that is senior in priority to such Liens and (ii) in all other
cases, the Notes are equally and ratably secured.
Caterair shall not, and shall not permit any of its Subsidiaries to
create, incur, assume or suffer to exist any Liens of any kind against or upon
any of its property or assets, or any proceeds therefrom, except for (i)
Permitted Liens, (ii) Liens securing Senior Debt and/or Guarantor Senior Debt
and (iii) Liens in favor of the Issuer or any Restricted Subsidiary of the
Issuer.
SECTION 4.19. Guarantees of Certain Indebtedness.
The Issuer shall not permit any of its domestic Restricted
Subsidiaries, directly or indirectly, to incur, guarantee or secure through the
granting of Liens the payment of any Indebtedness under the Senior Bank
Financing or any refunding or refinancing thereof, in each case unless such
Restricted Subsidiary, the Issuer and the Trustee execute and deliver a
supplemental indenture evidencing such Restricted Subsidiary's Guarantee, such
Guarantee to be a senior subordinated unsecured obligation of such Restricted
Subsidiary. Neither the Issuer nor any such Guarantor shall be required to make
a notation on the Notes or the Guarantees to reflect any such subsequent
Guarantee. Nothing in this covenant shall be construed to permit any Restricted
Subsidiary of the Issuer to incur Indebtedness otherwise prohibited by Section
4.12.
Caterair shall not permit any of its domestic Subsidiaries, directly or
indirectly, to incur, guarantee or secure through the granting of Liens the
payment of any Indebtedness under the Senior Bank Financing or any refunding or
refinancing thereof, in each case unless such Subsidiary, the Issuer and the
Trustee execute and deliver a supplemental indenture evidencing such
Subsidiary's Guarantee, such Guarantee to be a senior subordinated unsecured
obligation of such Subsidiary. Neither the Issuer nor any such Guarantor shall
be required to make a notation on the Notes or the Guarantees to reflect any
such subsequent Guarantee. Nothing in this covenant shall be construed to permit
any Subsidiary of Caterair to incur Indebtedness otherwise prohibited by Section
4.12.
83
-74-
SECTION 4.20. Conduct of Business of the Issuer
and Its Restricted Subsidiaries.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, engage in any business other than (i) the businesses in which
the Issuer, Caterair and their respective Subsidiaries and joint ventures are
engaged on the Issue Date; (ii) the businesses of (A) producing, distributing,
selling or delivering, or providing management or other services with respect
to, meals or other food products, (B) providing catering services, (C) providing
goods or services to Persons engaged in providing transportation services,
including, but not limited to, Persons engaged in the airline or other passenger
transportation business, or (D) providing goods or services to or at,
transportation terminals and other facilities, including, but not limited to,
airports, train stations, bus stations or roadside service facilities
(including, but not limited to, providing goods or services to any Person who
conducts operations at any such facility); or (iii) any business which is
determined in good faith by the Issuer's board of directors to be similar,
ancillary, complimentary or related to, or an extension of, any business
described in clause (i) or (ii) above.
SECTION 4.21. Conduct of Business of Caterair.
So long as any Caterair Lease or Caterair License that is in effect on
the Issue Date remains in effect, Caterair shall not, and shall not permit any
of its Subsidiaries to, engage in any business other than the leasing of the
Caterair Leased Property pursuant to the Caterair Lease and the licensing of the
Caterair Licensed Property pursuant to the Caterair License; provided, however,
that Caterair may continue to operate certain of its flight kitchens if Caterair
has not received as of the Issue Date the requisite consents to lease such
flight kitchens to the Issuer or a Subsidiary of the Issuer.
SECTION 4.22. Guarantor Capital Stock.
The Issuer or a Subsidiary Guarantor will own all of the Capital Stock
of each Guarantor (other than Caterair).
84
-75-
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. When Issuer May Merge, etc.
(a) The Issuer shall not, in a single transaction or a series of
related transactions, consolidate with or merge with or into, or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
assets to, another Person or Persons or adopt a Plan of Liquidation unless:
(i) either (A) the Issuer shall be the survivor of such merger or
consolidation or (B) the surviving or transferee Person is a corporation,
partnership or trust organized and existing under the laws of the United
States, any state thereof or the District of Columbia and such surviving or
transferee Person shall expressly assume all the obligations of the Issuer
under the Notes and this Indenture pursuant to a supplemental indenture;
(ii) except in the case of a transaction between the Issuer and a
Guarantor, immediately after giving effect to such transaction (on a pro
forma basis, including any Indebtedness incurred or anticipated to be
incurred in connection with such transaction), the Issuer or the surviving
Person is able to incur at least $1.00 of additional Indebtedness (other
than Permitted Indebtedness) in compliance with Section 4.12;
(iii) immediately before and immediately after giving effect to such
transaction (including any Indebtedness incurred or anticipated to be
incurred in connection with the transaction), no Default or Event of Default
shall have occurred and be continuing; and
(iv) the Issuer has delivered to the Trustee an Officers' Certificate
and Opinion of Counsel, each stating that such consolidation, merger or
transfer complies with this Indenture, that the surviving or transferee
Person agrees pursuant to a supplemental indenture to be bound thereby, and
that all conditions precedent in this Indenture relating to such transaction
have been satisfied.
(b) For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction
85
-76-
or series of related transactions) of all or substantially all of the properties
and assets of one or more Subsidiaries of the Issuer, the Capital Stock of which
constitutes all or substantially all of the properties and assets of the Issuer,
shall be deemed to be the transfer of all or substantially all of the properties
and assets of the Issuer.
SECTION 5.02. Successor Corporation Substituted.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Issuer or any adoption of a Plan of
Liquidation by the Issuer in accordance with Section 5.01, the surviving or
transferee Person shall succeed to, and be substituted for, and may exercise
every right and power of, the Issuer under this Indenture with the same effect
as if such surviving or transferee Person had been named as the Issuer herein;
provided, however, that solely for purposes of computing amounts described in
clause (iii) of the first paragraph of Section 4.10, any such surviving or
transferee Person shall only be deemed to have succeeded to and be substituted
for the Issuer with respect to periods subsequent to the effective time of such
merger, consolidation or transfer of assets.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following shall be an "Event of Default":
(1) the failure to pay interest on any Notes when the same becomes due
and payable and the default continues for a period of 30 days (whether or
not such payment shall be prohibited by Article Ten);
(2) the failure to pay the principal on any Notes, when such principal
becomes due and payable, at maturity, upon redemption or otherwise
(including the failure to make a payment to repurchase Notes tendered
pursuant to a Change of Control Offer or a Net Proceeds Offer or a Caterair
Net Proceeds Offer) (whether or not such payment shall be prohibited by
Article Ten);
86
-77-
(3) a default in the observance or performance of any other covenant or
agreement contained in this Indenture which default continues for a period
of 45 days after the Issuer receives written notice specifying the default
(and demanding that such default be remedied) from the Trustee or the
Holders of at least 25% of the outstanding principal amount of the Notes;
(4) the failure to pay at final stated maturity (giving effect to any
extensions thereof) the principal amount of any Indebtedness of (A) the
Issuer, (B) Caterair, (C) any Significant Subsidiary of the Issuer or
Caterair or (D) any combination of two or more Non-Significant Subsidiaries
of the Issuer which at the time of determination own on a combined basis
more than 10% of the consolidated assets of the Issuer (determined on a
basis consistent with the definition of "Significant Subsidiary") and such
failure continues for a period of 20 days or more, or the acceleration of
the final stated maturity of any such Indebtedness (which acceleration is
not rescinded, annulled or otherwise cured within 20 days of receipt by the
Issuer, Caterair, such Significant Subsidiary or such Non-Significant
Subsidiaries, as the case may be, of notice of any such acceleration) if, in
either case, the aggregate principal amount of such Indebtedness, together
with the principal amount of any other such Indebtedness in default for
failure to pay principal at final stated maturity or which has been
accelerated, in each case with respect to which the 20-day period described
above has passed, aggregates $15 million or more at any time;
(5) one or more judgments in an aggregate amount in excess of $15
million (which are not paid or covered by third-party insurance by
financially sound insurers that have not disclaimed coverage) shall have
been rendered against the Issuer, Caterair or any Significant Subsidiary of
the Issuer or Caterair and such judgments remain undischarged, unpaid or
unstayed for a period of 60 days after such judgment or judgments become
final and non-appealable;
(6) except as permitted by this Indenture, the Guarantee of Caterair or
of a Significant Subsidiary of the Issuer or Caterair shall be held in any
judicial proceeding to be unenforceable or invalid and such holding has
become final and non-appealable or the Guarantee of Caterair or of a
Significant Subsidiary of the Issuer or Cat-
87
-78-
erair shall cease for any other reason to be in full force and effect;
(7) the Issuer, Caterair or any Significant Subsidiary of the Issuer or
Caterair (A) commences a voluntary case or proceeding under any Bankruptcy
Law with respect to itself, (B) consents to the entry of a judgment, decree
or order for relief against it in an involuntary case or proceeding under
any Bankruptcy Law, (C) consents to the appointment of a Custodian of it or
for substantially all of its property, (D) consents to or acquiesces in the
institution of a bankruptcy or an insolvency proceeding against it or (E)
makes a general assignment for the benefit of its creditors; or
(8) a court of competent jurisdiction enters a judgment, decree or
order for relief in respect of the Issuer, Caterair or any Significant
Subsidiary of the Issuer or Caterair in an involuntary case or proceeding
under any Bankruptcy Law, which shall (A) approve as properly filed a
petition seeking reorganization, arrangement, adjustment or composition in
respect of the Issuer, Caterair or any Significant Subsidiary of the Issuer
or Caterair, (B) appoint a Custodian of the Issuer, Caterair or any
Significant Subsidiary of the Issuer or Caterair or for substantially all of
its property or (C) order the winding-up or liquidation of its affairs; and
such judgment, decree or order shall remain unstayed and in effect for a
period of 60 consecutive days.
SECTION 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in
paragraph 7 or 8 of Section 6.01 with respect to the Issuer) occurs and is
continuing and has not been waived pursuant to Section 6.04, the Trustee may, by
notice to the Issuer, or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding, by written notice to the Issuer and the
Trustee, and the Trustee shall, upon the request of such Holders, declare the
aggregate principal amount of the Notes outstanding, together with accrued but
unpaid interest, if any, on all Notes to be due and payable by notice in writing
to the Issuer and the Trustee specifying the respective Event of Default and
that it is a "notice of acceleration" (the "Acceleration Notice"), and the same
(i) shall become immediately due and payable or (ii) if there are any amounts
outstanding under the Senior Bank Financing, shall become due and payable upon
the first to occur of an acceleration under the
88
-79-
Senior Bank Financing or 5 Business Days after receipt by the Issuer and the
Representative under the Senior Bank Financing of such Acceleration Notice
(unless all Events of Default specified in such Acceleration Notice have been
cured or waived). If an Event of Default specified in paragraph 7 or 8 of
Section 6.01 occurs and is continuing with respect to the Issuer, all unpaid
principal and accrued interest on the Notes then outstanding shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder. The Holders of a majority in principal
amount of the Notes then outstanding (by notice to the Trustee) may rescind and
cancel a declaration of acceleration and its consequences if (i) the rescission
would not conflict with any judgment or decree of a court of competent
jurisdiction, (ii) all existing Events of Default have been cured or waived,
except non-payment of the principal or interest on the Notes which have become
due solely by such declaration of acceleration, (iii) to the extent the payment
of such interest is lawful, interest (at the same rate as specified in the
Notes) on overdue installments of interest and overdue payments of principal,
which has become due otherwise than by such declaration of acceleration, has
been paid, (iv) the Issuer has paid the Trustee its reasonable compensation and
reimbursed the Trustee for its expenses, disbursements and advances and (v) in
the event of the cure or waiver of a Default or Event of Default of the type
described in paragraphs 7 and 8 of Section 6.01, the Trustee shall have received
an Officers' Certificate and an Opinion of Counsel that such Default or Event of
Default has been cured or waived and the Trustee shall be entitled to
conclusively rely upon such Officer's Certificate and Opinion of Counsel. No
such rescission shall affect any subsequent Default or impair any right
consequent thereto.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of or interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder 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
89
-80-
is exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 6.07 and 9.02, the Holders of a majority in
principal amount of the outstanding Notes by notice to the Trustee may waive an
existing Default or Event of Default and its consequences, except a Default in
the payment of principal of or interest on any Note as specified in paragraphs 1
and 2 of Section 6.01.
SECTION 6.05. Control by Majority.
The Holders of a majority in principal amount of the outstanding Notes
may direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
it, including, without limitation, any remedies provided for in Section 6.03.
Subject to Section 7.01, however, the Trustee may, in its discretion, refuse to
follow any direction that conflicts with any law or this Indenture, that the
Trustee determines may be unduly prejudicial to the rights of another Holder, or
that may involve the Trustee in personal liability; provided that the Trustee
may take any other action deemed proper by the Trustee, in its discretion, which
is not inconsistent with such direction.
SECTION 6.06. Limitation on Suits.
A Holder may not pursue any remedy with respect to this Indenture or
the Notes unless:
(1) the Holder gives to the Trustee notice of a continuing Event of
Default;
(2) Holders of at least 25% in principal amount of the outstanding
Notes make a written request to the Trustee to pursue the remedy;
(3) such Holders offer to the Trustee indemnity or Note against any
loss, liability or expense to be incurred in compliance with such request
which is reasonably satisfactory to the Trustee;
(4) the Trustee does not comply with the request within 45 days after
receipt of the request and the offer of satisfactory indemnity or Note; and
90
-81-
(5) during such 45-day period the Holders of a majority in principal
amount of the outstanding Notes do not give the Trustee a direction which,
in the opinion of the Trustee, is inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder.
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 a Note, on or after
the respective due dates expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or interest specified in
paragraphs (1) or (2) of Section 6.01 occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Issuer or any other obligor on the Notes for the whole amount of principal and
accrued interest remaining unpaid, together with interest on overdue principal
and, to the extent that payment of such interest is lawful, interest on overdue
installments of interest at the rate set forth in the Notes and such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, taxes,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders allowed in any judicial proceedings relating to the Issuer or any other
obligor upon the Notes, any of their respective creditors or any of their
respective property, and shall be entitled and empowered to collect and receive
any monies or other property payable or deliverable on any such claims and to
distribute the same, and any Custodian in any such judicial proceedings is
hereby authorized by each Holder to make such pay-
91
-82-
ments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, taxes, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
the Trustee under Section 7.07. The Issuer's payment obligations under this
Section 6.09 shall be secured in accordance with the provisions of Section 7.07.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money pursuant to this Article Six, it
shall pay out the money in the following order:
First: to the Trustee for amounts due under Sections 6.09 and 7.07;
Second: if the Holders are forced to proceed against the Issuer
directly without the Trustee, to Holders for their collection costs;
Third: to Holders for amounts due and unpaid on the Notes for principal
and interest, ratably, without preference or priority of any kind, according
to the amounts due and payable on the Notes for principal and interest,
respectively; and
Fourth: to the Issuer or any other obligor on the Notes, as their
interests may appear, or as a court of competent jurisdiction may direct.
The Trustee, upon prior notice to the Issuer, may fix a record date and
payment date for any payment to Holders pursuant to this Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court 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
92
-83-
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than
10% in principal amount of the outstanding Notes.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a Default or an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in its exercise thereof as a
prudent person would exercise or use under the circumstances in the conduct of
its own affairs.
(b) Except during the continuance of a Default or an Event of Default:
(1) The Trustee need perform only those duties as are specifically set
forth in this Indenture or the TIA and no duties, covenants,
responsibilities or obligations shall be implied in this Indenture that are
adverse to the Trustee.
(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 (including Officers'
Certificates) or opinions (including Opinions of Counsel) furnished to the
Trustee and conforming to the requirements of this Indenture. However, as to
any certificates or opinions which are required by any provision of this
Indenture to be delivered or provided to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) Notwithstanding anything to the contrary herein contained, the
Trustee may not be relieved from liability for
93
-84-
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(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 6.02, 6.04 or 6.05.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money or assets
received by it except as the Trustee may agree in writing with the Issuer.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
(g) In the absence of bad faith, negligence or wilful misconduct on the
part of the Trustee, the Trustee shall not be responsible for the application of
any money by any Paying Agent other than the Trustee.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely and shall be fully protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document.
94
-85-
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate or an Opinion of
Counsel, which shall conform to Sections 13.04 and 13.05. The Trustee shall
not be liable for and shall be fully protected in respect of any action it
takes or omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent or attorney
appointed with due care.
(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it reasonably believes to be authorized or
within its rights or powers.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate (including any
Officers' Certificate), statement, instrument, opinion (including any
Opinion of Counsel), notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as
it may see fit and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled, upon reasonable notice to
the Issuer, to examine the books, records, and premises of the Issuer,
personally or by agent or attorney.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders of the Notes pursuant to the provisions of
this Indenture, unless such Holders shall have offered to the Trustee
reasonable Note or indemnity against the costs, expenses and liabilities
which may be incurred by it in compliance with such request, order or
direction.
(g) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and
protection from liability with respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance with the advice or
opinion of such counsel.
95
-86-
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuer, Caterair, any
Subsidiary of the Issuer or Caterair, or their respective Affiliates, with the
same rights it would have if it were not Trustee. Any Agent may do the same with
like rights. However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Notes, and it shall not be accountable for the Issuer's
use of the proceeds from the Notes, and it shall not be responsible for any
statement of the Issuer in this Indenture or the Notes other than the Trustee's
certificate of authentication.
SECTION 7.05. Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to each Holder notice of the
uncured Default or Event of Default within 90 days after such Default or Event
of Default occurs. Except in the case of a Default or an Event of Default in
payment of principal of, or interest on, any Note, including an accelerated
payment and the failure to make payment on the Change of Control Payment Date
pursuant to a Change of Control Offer or on the Proceeds Purchase Date pursuant
to a Net Proceeds Offer or Caterair Net Proceeds Offer, as the case may be, and,
except in the case of a failure to comply with Article Five, the Trustee may
withhold the notice if and so long as its Board of Directors, the executive
committee of its Board of Directors or a committee of its directors and/or Trust
Officers in good faith determines that withholding the notice is in the interest
of the Holders. The Trustee shall not be deemed to have knowledge of a Default
or Event of Default other than (i) any Event of Default occurring pursuant to
Section 6.01(1), 6.01(2) or 4.01; or (ii) any Default or Event of Default of
which a Trust Officer shall have received written notification or obtained
actual knowledge.
SECTION 7.06. Reports by Trustee to Holders.
Within 60 days after May 15 of each year beginning with May 15, 1998,
the Trustee shall, to the extent that any of the events described in TIA Section
313(a) occurred within the previ-
96
-87-
ous twelve months, but not otherwise, mail to each Holder a brief report dated
as of such date that complies with TIA Section 313(a). The Trustee also shall
comply with TIA Sections 313(b) and 313(c).
A copy of each report at the time of its mailing to Holders shall be
mailed to the Issuer and filed with the SEC and each stock exchange, if any, on
which the Notes are listed.
The Issuer shall promptly notify the Trustee if the Notes become listed
on any stock exchange and the Trustee shall comply with TIA Section 313(d).
SECTION 7.07. Compensation and Indemnity.
The Issuer shall pay to the Trustee in its capacity as such from time
to time such compensation as may be agreed upon in writing by the Issuer and the
Trustee. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuer shall reimburse the
Trustee upon request for all reasonable out-of-pocket expenses, disbursements
and advances incurred or made by it in connection with the performance of its
duties and the discharge of its obligations under this Indenture. Such expenses
shall include the reasonable fees and expenses of the Trustee's agents and
counsel.
The Issuer shall indemnify the Trustee and its agents, employees,
officers, stockholders and directors for, and hold them harmless against, any
loss, liability, damage, claim or expense incurred by them except for such
actions to the extent caused by any negligence, bad faith or willful misconduct
on their part, arising out of or in connection with the acceptance or
administration of this trust including the reasonable costs and expenses of
defending themselves against any claim or liability in connection with the
exercise or performance of any of their rights, powers or duties hereunder. The
Trustee shall notify the Issuer promptly of any claim asserted against the
Trustee for which it may seek indemnity. The Issuer shall defend the claim and
the Trustee shall cooperate in the defense. The Trustee may have separate
counsel and the Issuer shall pay the reasonable fees and expenses of such
counsel. The Issuer need not pay for any settlement made without its written
consent. The Issuer need not reimburse any expense or indemnify against any loss
or liability to the extent incurred by the Trustee through its negligence, bad
faith or willful misconduct.
97
-88-
To secure the Issuer's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Notes on all assets or money held or
collected by the Trustee, in its capacity as Trustee, except assets or money
held in trust to pay principal of or interest on particular Notes.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(7) or (8) occurs, such expenses and the
compensation for such services shall be paid to the extent allowed under any
Bankruptcy Law.
The provisions of this Section 7.07 shall survive the termination of
this Indenture.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Issuer. The Holders of a
majority in principal amount of the outstanding Notes may remove the Trustee by
so notifying the Issuer and the Trustee and may appoint a successor trustee. The
Issuer may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuer shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Notes may appoint a successor Trustee to replace the successor Trustee
appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Promptly after that, the
retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 7.07, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Holder.
98
-89-
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 10% in principal amount of the outstanding Notes may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Issuer's obligations under Section 7.07 shall continue for the benefit
of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee; provided that such
corporation shall be otherwise qualified and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(1) and 310(a)(2). The Trustee (or in
the case of a corporation included in a bank holding company system, the related
bank holding company) shall have a combined capital and surplus of at least
$100,000,000 as set forth in its most recent published annual report of
condition. In addition, if the Trustee is a corporation included in a bank
holding company system, the Trustee, independently of such bank holding company,
shall meet the capital requirements of TIA Section 310(a)(2). 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 Notes, or certificates of interest or participation in other Notes,
of the Issuer are outstanding, if the requirements for such exclusion set forth
in TIA Section 310(b)(1) are met. The provisions of TIA Section 310 shall apply
to the Issuer and any other obligor of the Notes.
99
-90-
SECTION 7.11. Preferential Collection of
Claims Against the Issuer.
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. The provisions of TIA Section 311 shall apply to the Issuer and any
other obligor of the Notes.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of the Issuer's Obligations.
This Indenture shall cease to be of further effect and the obligations
of the Issuer under the Notes and this Indenture and the obligations of the
Guarantors under the Guarantees and this Indenture shall terminate (except that
the Issuer's obligations under Section 7.07 and the Trustee's and the Paying
Agent's obligations under Sections 8.04 and 8.05 shall survive the effect of
this Article Eight) when (i) all outstanding Notes theretofore authenticated
have been delivered to the Trustee for cancellation and the Issuer has paid or
caused to be paid all sums payable by it hereunder or (ii) the Issuer has called
for redemption pursuant to this Indenture and the Notes all of the Notes under
arrangements satisfactory to the Trustee, the amounts described in Section
8.01(a) below have been deposited, the conditions in clauses (i) and (ii) of the
proviso in Section 8.01(a) have been satisfied and the Officers' Certificate and
Opinion of Counsel described in Section 8.01(e) have been delivered.
In addition, this Indenture shall cease to be of further effect as to
all outstanding Notes if:
(a) the Issuer irrevocably deposits, or causes to be deposited, with
the Trustee, in trust for the benefit of the Holders pursuant to an irrevocable
trust and Note agreement in form and substance reasonably satisfactory to the
Trustee (i) U.S. Legal Tender, (ii) U.S. Government Obligations or (iii) a
combination thereof, in an amount sufficient after payment of all federal, state
and local taxes or other charges or assessments in respect thereof payable by
the Trustee, which through the payment of interest and principal will provide,
not later
100
-91-
than one day before the due date of payment in respect of the Notes, U.S. Legal
Tender in an amount which, in the opinion of a nationally recognized firm of
independent certified public accountants expressed in a written certification
thereof (in form and substance reasonably satisfactory to the Trustee) delivered
to the Trustee, is sufficient to pay the principal of, premium, if any, and
interest on the Notes then outstanding on the dates on which any such payments
are due and payable in accordance with the terms of this Indenture and of the
Notes; provided that (i) the trustee of the irrevocable trust shall have been
irrevocably instructed to pay such money or the proceeds of such U.S. Government
Obligations to the Trustee and (ii) the Trustee shall have been irrevocably
instructed to apply such money or the proceeds of such U.S. Government
Obligations to the payment of said principal and interest with respect to the
Notes;
(b) no Default or Event of Default shall have occurred or be continuing
on the date of such deposit and such deposit will not result in a Default or
Event of Default under this Indenture or a breach or violation of, or constitute
a default under, any other instrument to which the Issuer or any Subsidiary of
the Issuer is a party or by which it or its property is bound;
(c) the Issuer shall have delivered to the Trustee an Opinion of
Counsel from independent counsel reasonably satisfactory to the Trustee or a tax
ruling from the Internal Revenue Service to the effect that the holders will not
recognize income, gain or loss for federal income tax purposes as a result of
such deposit and defeasance and will be subject to federal income tax in the
same amounts and in the same manner and at the same times as would have been the
case if such deposit and defeasance had not occurred;
(d) the Issuer shall have delivered to the Trustee an Opinion of
Counsel to the effect that after the 91st day following the deposit, such money
or the proceeds of such U.S. Government Obligations will not be subject to the
effect of any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally; and
(e) the Issuer has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each in form and substance reasonably satisfactory to
the Trustee, each stating that all conditions precedent relating to the
satisfaction and discharge of this Indenture have been complied with.
101
-92-
Notwithstanding the foregoing paragraph, the Issuer's and the
Guarantors' respective obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06 and
2.12, Article Three and Sections 4.01, 4.02, 4.03, 7.07, 7.08, 8.04 and 8.05
shall survive until the Notes are no longer outstanding. Thereafter, the
Issuer's obligations in Section 7.07 and the Trustee's and the Paying Agent's
obligations under Sections 8.04 and 8.05 shall survive.
SECTION 8.02. Acknowledgment of Discharge by Trustee.
Subject to Section 8.05, after (i) the conditions of Section 8.01, have
been satisfied and (ii) the Issuer has delivered to the Trustee an Opinion of
Counsel, stating that all conditions precedent referred to in clause (i) above
relating to the satisfaction and discharge of this Indenture have been complied
with, the Trustee upon written request of the Issuer shall acknowledge in
writing the discharge of the Issuer's and the Guarantor's respective obligations
under this Indenture except for those surviving obligations specified in this
Article Eight.
SECTION 8.03. Application of Trust Money.
The Trustee shall hold in trust U.S. Legal Tender or U.S. Government
Obligations deposited with it pursuant to Section 8.01. It shall apply the
deposited U.S. Legal Tender or U.S. Government Obligations through the Paying
Agent and in accordance with this Indenture to the payment of principal and
accrued and unpaid interest on the Notes.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Legal Tender or U.S.
Obligations deposited pursuant to Section 8.01 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of outstanding Notes.
SECTION 8.04. Repayment to the Issuer.
The Trustee and the Paying Agent shall promptly pay to the Issuer any
excess U.S. Legal Tender or U.S. Government Obligations held by them for the
payment of principal or interest that remains unclaimed for one year; provided,
however, that the Trustee or such Paying Agent may, at the expense of the
Issuer, cause to be published once in a newspaper of general circulation in the
City of New York or mailed to each Holder, notice that such money remain
unclaimed and that, after
102
-93-
a date specified therein, which shall not be less than 30 days from the date of
such publication or mailing, any unclaimed balance of such money then remaining
will be repaid to the Issuer. After payment to the Issuer, Holders entitled to
such money must look to the Issuer for payment as general creditors unless an
applicable abandoned property law designates another Person and all liability of
the Trustee and Paying Agent with respect to such money shall cease.
SECTION 8.05. Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. Legal Tender
or U.S. Government Obligations by reason of any legal proceeding or by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the Issuer's and the
Guarantors' respective obligations under this Indenture, the Notes and the
Guarantees shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.01 until such time as the Trustee or Paying Agent is
permitted to apply all such U.S. Legal Tender or U.S. Government Obligations in
accordance with Section 8.01; provided, however, that if the Issuer has made any
payment of interest on or principal of any Notes because of the reinstatement of
its obligations, the Issuer shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the U.S. Legal Tender or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Issuer and the Guarantors, when authorized by a Board Resolution,
and the Trustee, together, may amend or supplement this Indenture or the Notes
without notice to or consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency; provided that such
amendment or supplement does not, in the opinion of the Trustee, adversely
affect the rights of any of the Holders in any material respect;
103
-94-
(2) to comply with Article Five and Section 11.05 of this Indenture;
(3) to provide for uncertificated Notes in addition to or in place of
certificated Notes; or
(4) to make any other change that does not adversely affect in any
material respect the rights of any Holder hereunder;
provided that the Issuer has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.01.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Issuer and the Guarantors, when authorized
by a Board Resolution, and the Trustee, together, with the written consent of
the Holder or Holders of at least a majority in principal amount of the
outstanding Notes may amend or supplement this Indenture or the Notes, without
notice to any other Holders. Subject to Sections 6.04 and 6.07, the Holder or
Holders of a majority in aggregate principal amount of the outstanding Notes may
waive compliance by the Issuer or the Guarantors with any provision of this
Indenture, the Notes or the Guarantees without notice to any other Holders.
(a) No amendment, supplement or waiver, including a waiver pursuant to
Section 6.04, shall, directly or indirectly, without the consent of each Holder
of each Note affected thereby:
(1) reduce the amount of Notes whose Holders must consent to an
amendment;
(2) reduce the rate of or change or have the effect of changing the
time for payment of interest, including defaulted interest, on any Notes;
(3) reduce the principal of or change or have the effect of changing
the fixed maturity of any Notes, or, except with respect to the matters
described in clause (b)(1) below, change the date on which any Notes may be
subject to redemption or repurchase, or reduce the redemption or repurchase
price therefor;
104
-95-
(4) make any Notes payable in money other than that stated in the
Notes;
(5) make any change in provisions of this Indenture protecting the
right of each Holder of a Note to receive payment of principal of and
interest on such Note on or after the due date thereof or to bring suit to
enforce such payment, or permitting Holders of a majority in principal
amount of a class of Notes to waive Defaults or Events of Default (other
than Defaults or Events of Default with respect to the payment of principal
of or interest on the Notes); or
(6) modify the provisions of Article Ten or Twelve of this Indenture to
adversely affect the Holders of Notes.
(b) No amendment, supplement or waiver, including a waiver pursuant to
Section 6.04, shall directly or indirectly, without the consent of the Holders
of at least 75% in aggregate principal amount of the then outstanding Notes
issued under this Indenture, (1) amend, change or modify the obligation of (A)
the Issuer to make and consummate a Change of Control Offer in the event of a
Change of Control that has been consummated or make and consummate a Net
Proceeds Offer with respect to any Asset Sale that has been consummated or
modify any of the provisions or definitions with respect thereto or (B) Caterair
to make and consummate a Caterair Net Proceeds Offer with respect to any
Caterair Asset Sale that has been consummated or modify any of the provisions or
definitions with respect thereto; or (2) release Caterair or any other Guarantor
which is a Significant Subsidiary of the Issuer or Caterair from any of its
obligations under its Guarantee or this Indenture other than in accordance with
the terms of such Guarantee and this Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective (as provided in Section 9.04), the Issuer shall mail to the
Holders affected thereby a notice briefly describing the amendment, supplement
or waiver.
000
-00-
XXXXXXX 9.03. Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the Notes
shall comply with the TIA as then in effect.
No amendment of this Indenture shall adversely affect the rights of any
holder of Senior Debt under Article Ten or Guarantor Senior Debt under Article
Twelve without the consent of such holder.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder's Note, even if notation of the consent is not made on any
Note. Subject to the following paragraph, any such Holder or subsequent Holder
may revoke the consent as to his Note or portion of his Note by notice to the
Trustee or the Issuer received before the date on which the Trustee receives an
Officers' Certificate certifying that the Holders of the requisite principal
amount of Notes have consented (and not theretofore revoked such consent) to the
amendment, supplement or waiver (at which time such amendment, supplement or
waiver shall become effective).
The Issuer may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be at least 30 days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to revoke any consent previously
given, whether or not such Persons continue to be Holders after such record
date. No such consent shall be valid or effective for more than 120 days after
such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in any of clauses (1)
through (6) of Section 9.02(a), in which case, the amendment, supplement or
waiver shall bind only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note; provided that any such waiver shall not impair or
affect the right of any
106
-97-
Holder to receive payment of principal of and interest on a Note, on or after
the respective due dates expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates without the
consent of such Holder.
SECTION 9.05. Notation on or Exchange of Notes.
If an amendment, supplement or waiver changes the terms of a Note, the
Trustee may require the Holder of the Note to deliver it to the Trustee. The
Trustee may place an appropriate notation on the Note about the changed terms
and return it to the Holder. Alternatively, if the Issuer or the Trustee so
determines, the Issuer in exchange for the Note shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms.
SECTION 9.06. Trustee To Sign Amendments, etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to and adopted in accordance with this Article Nine;
provided that the Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture. The Trustee shall be entitled to receive,
and shall be fully protected in relying upon, an Opinion of Counsel and an
Officers' Certificate each stating that the execution of any amendment,
supplement or waiver authorized pursuant to this Article Nine is authorized or
permitted by this Indenture. Such Opinion of Counsel shall not be an expense of
the Trustee.
ARTICLE TEN
SUBORDINATION OF NOTES
SECTION 10.01. Notes Subordinated to Senior Debt.
The Issuer covenants and agrees and the Trustee and each Holder of the
Notes, by its acceptance thereof, likewise covenants and agrees, that all Notes
shall be issued subject to the provisions of this Article Ten; and the Trustee
and each Person holding any Note, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees that the payment of all
Obligations on the Notes by the Issuer shall, to the extent and in the manner
herein set forth, be
107
-98-
subordinated and junior in right of payment to the prior payment in full in cash
or Cash Equivalents (or such payment shall be duly provided for to the
satisfaction of the holders of the Senior Debt) of all Obligations on the Senior
Debt; that the subordination is for the benefit of, and shall be enforceable
directly by, the holders of Senior Debt, and that each holder of Senior Debt
whether now outstanding or hereafter created, incurred, assumed or guaranteed
shall be deemed to have acquired Senior Debt in reliance upon the covenants and
provisions contained in this Indenture and the Notes.
SECTION 10.02. No Payment on Notes in Certain
Circumstances.
(a) If any default occurs and is continuing in the payment when due,
whether at maturity, upon any redemption, by declaration or otherwise, of any
principal of, interest on, unpaid drawings for letters of credit issued in
respect of, or regularly accruing fees with respect to, any Senior Debt
(including for this purpose any such default in payment by Caterair or any other
borrower with respect to the Senior Bank Financing which is a Subsidiary of the
Issuer with respect to its Obligations with respect to the Senior Bank Financing
or any Interest Swap Obligations related thereto), no payment of any kind or
character shall be made by or on behalf of the Issuer or any other Person on its
or their behalf with respect to any Obligations on the Notes or to acquire any
of the Notes for cash or property or otherwise. In addition, if any other event
of default occurs and is continuing with respect to any Designated Senior Debt,
as such event of default is defined in the instrument creating or evidencing
such Designated Senior Debt, permitting the holders of such Designated Senior
Debt then outstanding to accelerate the maturity thereof and if the
Representative for the respective issue of Designated Senior Debt gives written
notice of the event of default to the Trustee (a "Default Notice"), then, unless
and until all events of default have been cured or waived or have ceased to
exist or the Trustee receives notice from the Representative for the respective
issue of Designated Senior Debt terminating the Blockage Period (as defined
below), during the 180 days after the delivery of such Default Notice (the
"Blockage Period"), neither the Issuer nor any other Person on its behalf shall
(x) make any payment of any kind or character with respect to any Obligations on
the Notes or (y) acquire any of the Notes for cash or property or otherwise.
Notwithstanding anything herein to the contrary, in no event will a Blockage
Period extend beyond 180 days from the date such Blockage Period was commenced
and only one such Blockage Period may be commenced within any 360 consecutive
108
-99-
days. No event of default which existed or was continuing on the date of the
commencement of any Blockage Period with respect to the Designated Senior Debt
shall be, or be made, the basis for commencement of a second Blockage Period by
the Representative of such Designated Senior Debt whether or not within a period
of 360 consecutive days, unless such event of default shall have been cured or
waived for a period of not less than 90 consecutive days (it being acknowledged
that any subsequent action, or any breach of any financial covenants for a
period commencing after the date of commencement of such Blockage Period that,
in either case, would give rise to an event of default pursuant to any provision
under which an event of default previously existed or was continuing shall
constitute a new event of default for this purpose).
(b) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by
Section 10.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Senior Debt (pro rata to such
holders on the basis of the respective amount of Senior Debt held by such
holders) or their respective Representatives, as their respective interests may
appear. The Trustee shall be entitled to rely on information regarding amounts
then due and owing on the Senior Debt, if any, received from the holders of
Senior Debt (or their Representatives) or, if such information is not received
from such holders or their Representatives, from the Issuer and only amounts
included in the information provided to the Trustee shall be paid to the holders
of Senior Debt.
(c) Nothing contained in this Article Ten shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Section 6.02 or to pursue any rights or remedies
hereunder; provided that all Senior Debt thereafter due or declared to be due
shall first be paid in full in cash or Cash Equivalents before the Holders are
entitled to receive any payment with respect to Obligations on the Notes.
SECTION 10.03. Payment Over of Proceeds upon
Dissolution, etc.
(a) Upon any payment or distribution of assets of the Issuer of any
kind or character, whether in cash, property or securities, to creditors upon
any total or partial liquidation, dissolution, winding-up, reorganization,
assignment for the benefit of creditors or marshalling of assets of the Issuer
109
-100-
or in a bankruptcy, reorganization, insolvency, receivership or other similar
proceeding relating to the Issuer or its property, whether voluntary or
involuntary, all Obligations due or to become due upon all Senior Debt shall
first be paid in full in cash or Cash Equivalents (or such payment duly provided
for to the satisfaction of the holders of the Senior Debt) before any payment or
distribution of any kind or character is made on account of any Obligations on
the Notes, or for the acquisition of any of the Notes for cash or property or
otherwise. Upon any such dissolution, winding-up, liquidation, reorganization,
receivership or similar proceeding, any payment or distribution of assets of the
Issuer of any kind or character, whether in cash, property or securities, to
which the Holders of the Notes or the Trustee under this Indenture would be
entitled, except for the provisions hereof, shall be paid by the Issuer or by
any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Holders of the Notes or by the
Trustee under this Indenture if received by them, directly to the holders of
Senior Debt (pro rata to such holders on the basis of the respective amounts of
Senior Debt held by such holders) or their respective Representatives, or to the
trustee or trustees under any indenture pursuant to which any of such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of Senior Debt remaining unpaid until all such Senior
Debt has been paid in full in cash or Cash Equivalents after giving effect to
any concurrent payment, distribution or provision therefor to or for the holders
of Senior Debt.
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Issuer of any kind or character, whether in cash,
property or securities, shall be received by any Holder when such payment or
distribution is prohibited by Section 10.03(a), such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of Senior Debt (pro rata to such holders on the basis of the
respective amount of Senior Debt held by such holders) or their respective
Representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Debt may have been issued, as their respective
interests may appear, for application to the payment of Senior Debt remaining
unpaid until all such Senior Debt has been paid in full in cash or Cash
Equivalents, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Debt.
(c) To the extent any payment of Senior Debt (whether by or on behalf
of the Issuer, as proceeds of security
110
-101-
or enforcement of any right of setoff or otherwise) is declared to be fraudulent
or preferential, set aside or required to be paid to any receiver, trustee in
bankruptcy, liquidating trustee, agent or other similar Person under any
bankruptcy, insolvency, receivership, fraudulent conveyance or similar law,
then, if such payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar Person, the Senior
Debt or part thereof originally intended to be satisfied shall be deemed to be
reinstated and outstanding as if such payment had not occurred.
(d) The consolidation of the Issuer with, or the merger of the Issuer
with or into, another corporation or the liquidation or dissolution of the
Issuer following the conveyance or transfer of all or substantially all of its
assets to another corporation upon the terms and conditions provided in Article
Five and as long as permitted under the terms of the Senior Debt shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section 10.03 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, assume the Issuer's obligations
hereunder in accordance with Article Five.
SECTION 10.04. Payments May Be Paid Prior to Dissolution.
Subject to Sections 10.02(b) and 10.03(b), nothing contained in this
Article Ten or elsewhere in this Indenture shall prevent (i) the Issuer, except
under the conditions described in Sections 10.02 and 10.03, from making payments
at any time for the purpose of making payments of principal of and interest on
the Notes, or from depositing with the Trustee any moneys for such payments, or
(ii) in the absence of actual knowledge by the Trustee that a given payment
would be prohibited by Section 10.02 or 10.03, the application by the Trustee of
any moneys deposited with it for the purpose of making such payments of
principal of, and interest on, the Notes to the Holders entitled thereto unless
at least two Business Days prior to the date upon which such payment would
otherwise become due and payable, the Trustee shall have actually received the
written notice provided for in the second sentence of Section 10.02(a) or in
Section 10.07. The Issuer shall give prompt written notice to the Trustee of any
dissolution, winding-up, liquidation or reorganization of the Issuer.
SECTION 10.05. Subrogation.
Subject to the payment in full in cash or Cash Equivalents of all
Senior Debt, the Holders of the Notes shall
111
-102-
be subrogated to the rights of the holders of Senior Debt to receive payments or
distributions of cash, property or securities of the Issuer applicable to the
Senior Debt until the Notes shall be paid in full; and, for the purposes of such
subrogation, no such payments or distributions to the holders of the Senior Debt
by or on behalf of the Issuer or by or on behalf of the Holders by virtue of
this Article Ten which otherwise would have been made to the Holders shall, as
between the Issuer and the Holders of the Notes, be deemed to be a payment by
the Issuer to or on account of the Senior Debt, it being understood that the
provisions of this Article Ten are and are intended solely for the purpose of
defining the relative rights of the Holders of the Notes, on the one hand, and
the holders of the Senior Debt, on the other hand.
SECTION 10.06. Obligations of the Issuer Unconditional.
Nothing contained in this Article Ten or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among the Issuer, its creditors
other than the holders of Senior Debt, and the Holders of the Notes, the
obligation of the Issuer, which is absolute and unconditional, to pay to the
Holders of the Notes the principal of and any interest on the Notes as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders of the Notes and
creditors of the Issuer other than the holders of the Senior Debt, nor shall
anything herein or therein prevent the Holder of any Note or the Trustee on its
behalf from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, of the holders of
Senior Debt in respect of cash, property or securities of the Issuer received
upon the exercise of any such remedy.
SECTION 10.07. Notice to Trustee.
The Issuer shall give prompt written notice to the Trustee of any fact
known to the Issuer which would prohibit the making of any payment to or by the
Trustee in respect of the Notes pursuant to the provisions of this Article Ten.
Regardless of anything to the contrary contained in this Article Ten or
elsewhere in this Indenture, the Trustee shall not be charged with knowledge of
the existence of any default or event of default with respect to any Senior Debt
or of any other facts which would prohibit the making of any payment to or by
the Trustee unless and until the Trust Officer of the Trustee shall have
received notice in writing from the Issuer, or from a holder of Senior Debt or a
Representative therefor, and,
112
-103-
prior to the receipt of any such written notice, the Trustee shall be entitled
to assume (in the absence of actual knowledge to the contrary) that no such
facts exist; provided, however, that if a Trust Officer of the Trustee shall not
have received, at least two Business Days prior to the date upon which by the
terms hereof any such money may become payable for any purpose, the notice with
respect to such money provided for in this Section 10.07, then, anything herein
contained to the contrary notwithstanding, but otherwise subject to the
provisions of Sections 10.02(b) and 10.03(b), the Trustee shall have full power
and authority to receive such money and to apply the same to the purpose for
which such money was received and shall not be affected by any notice to the
contrary which may be received by it within two Business Days prior to such
date.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior Debt
(or a trustee or agent on behalf of such holder) to establish that such notice
has been given by a holder of Senior Debt (or a trustee or agent on behalf of
any such holder). In the event that the Trustee determines in good faith that
any evidence is required with respect to the right of any Person as a holder of
Senior Debt to participate in any payment or distribution pursuant to this
Article Ten, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amounts of Senior Debt held by
such Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Ten, 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.
SECTION 10.08. Reliance on Judicial Order or Certificate of
Liquidating Agent.
Upon any payment or distribution of assets of the Issuer referred to in
this Article Ten, the Trustee, subject to the provisions of Article Seven
hereof, and the Holders of the Notes shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which bankruptcy,
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or upon a certificate of the receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or distribution, delivered to
the Trustee or the Holders of the Notes, for the purpose of ascertaining the
Persons entitled to participate in such distribution, the holders of the Senior
Debt and other Indebtedness of the Is-
113
-104-
xxxx, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
Ten.
SECTION 10.09. Trustee's Relation to Senior Debt.
The Trustee and any agent of the Issuer or the Trustee shall be
entitled to all the rights set forth in this Article Ten with respect to any
Senior Debt which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Senior Debt and nothing in
this Indenture shall deprive the Trustee or any such agent of any of its rights
as such holder.
Nothing in this Article Ten shall apply to claims of, or payments to,
the Trustee in its capacity as such under or pursuant to Section 7.07.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its duties, covenants, responsibilities and
obligations as are specifically set forth in this Article Ten, and no implied
duties, covenants, responsibilities or obligations with respect to the holders
of Senior Debt shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Debt and shall not be liable to any such holders if the Trustee shall in good
faith mistakenly pay over or distribute to Holders of Notes or to the Issuer or
to any other Person cash, property or securities to which any holders of Senior
Debt shall be entitled by virtue of this Article Ten or otherwise.
Whenever a distribution is to be made or a notice given to holders or
owners of Senior Debt, the distribution may be made and the notice may be given
to their Representative, if any.
SECTION 10.10. Subordination Rights Not Impaired by
Acts or Omissions of the Issuer or
Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to enforce
subordination as provided herein shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Issuer or by any act or
failure to act, in good faith, by any such holder, or by any noncompliance by
the Issuer with the terms of this Indenture, re-
114
-105-
gardless of any knowledge thereof which any such holder may have or otherwise be
charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee, without incurring responsibility to the
Trustee or the Holders of the Notes and without impairing or releasing the
subordination provided in this Article Ten or the obligations hereunder of the
Holders of the Notes to the holders of the Senior Debt, do any one or more of
the following: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt, or otherwise amend or
supplement in any manner Senior Debt, or any instrument evidencing the same or
any agreement under which Senior Debt is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (iii) release any Person liable in any manner for the
payment or collection of Senior Debt; and (iv) exercise or refrain from
exercising any rights against the Issuer and any other Person.
SECTION 10.11. Holders Authorize Trustee To
Effectuate Subordination of Notes.
Each Holder of a Note by its acceptance of such Note authorizes and
expressly directs the Trustee on such Holder's behalf to take such action as may
be necessary or appropriate to effectuate, as between the holders of Senior Debt
and the Holders of Notes, the subordination provided in this Article Ten, and
appoints the Trustee such Holder's attorney-in-fact to act for and on behalf of
each such Holder of Notes for such purposes, including, in the event of any
dissolution, winding-up, liquidation or reorganization of the Issuer (whether in
bankruptcy, insolvency, receivership, reorganization or similar proceedings or
upon an assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Issuer, the filing of a claim for
the unpaid balance of its Notes and accrued interest in the form required in
those proceedings.
If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of Senior Debt or their
Representative are or is hereby authorized to have the right to file and are or
is hereby authorized to file an appropriate claim for and on behalf of the
Holders of said Notes. Nothing herein contained
115
-106-
shall be deemed to authorize the Trustee or the holders of Senior Debt or their
Representative to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee or the holders of Senior Debt or their Representative to vote in respect
of the claim of any Holder in any such proceeding.
SECTION 10.12. This Article Ten Not To Prevent Events
of Default.
The failure to make a payment on account of principal of or interest on
the Notes by reason of any provision of this Article Ten will not be construed
as preventing the occurrence of an Event of Default.
ARTICLE ELEVEN
GUARANTEES OF THE NOTES
SECTION 11.01. Guarantees.
Subject to the provisions of this Article Eleven, each Guarantor hereby
jointly and severally unconditionally guarantees to each Holder of a Note
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Indenture,
the Notes or the obligations of the Issuer or any of the other Guarantors to the
Holders or the Trustee hereunder or thereunder, that: (a) the principal of and
interest on the Notes will be duly and punctually paid in full when due, whether
at maturity, by acceleration or otherwise, and interest on the overdue principal
and (to the extent permitted by law) interest, if any, on the Notes and all
other Obligations on the Notes will be promptly paid in full or performed, all
in accordance with the terms hereof and thereof; and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other
Obligations on the Notes, the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
final stated maturity, by acceleration or otherwise. Failing payment when due of
any amount so guaranteed, for whatever reason, each Guarantor will be obligated
to pay the same immediately. An Event of Default under this Indenture or the
Notes shall constitute an event of default under the Guarantees, and shall
entitle the Holders of
116
-107-
Notes to accelerate the obligations of the Guarantors hereunder in the same
manner and to the same extent as the Obligations of the Issuer on the Notes.
Each of the Guarantors hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Notes with respect
to any provisions hereof or thereof, any release of any other Guarantor, the
recovery of any judgment against the Issuer, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Note, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor. Each of the Guarantors hereby waives the benefit of
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Issuer, any right to require a
proceeding first against the Issuer, protest, notice and all demands whatsoever
and covenants that its Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes, this Indenture and the
Guarantees. If any Holder or the Trustee is required by any court or otherwise
to return to the Issuer or to any Guarantor, or any custodian, trustee,
liquidator or other similar official acting in relation to the Issuer or such
Guarantor, any amount paid by the Issuer or such Guarantor to the Trustee or
such Holder, the Guarantees, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor further agrees that, as
between it, on the one hand, and the Holders of Notes and the Trustee, on the
other hand, (a) subject to this Article Eleven, the maturity of the obligations
guaranteed hereby may be accelerated as provided in Section 6.02 for the
purposes of the Guarantees, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (b) in the event of any acceleration of such obligations
as provided in Section 6.02, such obligations (whether or not due and payable)
shall forthwith become due and payable by the Guarantors for the purpose of the
Guarantees.
The Guarantees shall remain in full force and effect and continue to be
effective should any petition be filed by or against the Issuer for liquidation
or reorganization, should the Issuer become insolvent or make an assignment for
the benefit of creditors or should a receiver or trustee be appointed for all or
any significant part of the Issuer's assets, and shall, to the fullest extent
permitted by law, continue to be effective or be reinstated, as the case may be,
if at any time
117
-108-
payment and performance of the Notes are, pursuant to applicable law, rescinded
or reduced in amount, or must otherwise be restored or returned by any obligee
on the Notes, whether as a "voidable preference," "fraudulent transfer" or
otherwise, all as though such payment or performance had not been made. In the
event that any payment, or any part thereof, is rescinded, reduced, restored or
returned, the Notes shall, to the fullest extent permitted by law, be reinstated
and deemed reduced only by such amount paid and not so rescinded, reduced,
restored or returned.
No stockholder, officer, director, employee or incorporator, past,
present or future, of any Guarantor, as such, shall have any personal liability
under the Guarantees by reason of his, her or its status as such stockholder,
officer, director, employee or incorporator.
The Guarantors shall have the right to seek contribution from any
non-paying Guarantor so long as the exercise of such right does not impair the
rights of the Holders under the Guarantees.
Each Guarantor, and by its acceptance hereof each Holder, hereby
confirms that it is the intention of all such parties that in no event shall any
Guarantor's obligations under its Guarantee be subject to avoidance under any
applicable fraudulent conveyance or similar law of any relevant jurisdiction.
Therefore, in the event that the Guarantees would, but for this sentence, be
subject to avoidance, then the liability of the Guarantors under the Guarantees
shall be reduced to the extent necessary such that such Guarantees shall not be
subject to avoidance under the applicable fraudulent conveyance or similar law.
Subject to the preceding limitation on liability, the Guarantee of each
Guarantor constitutes a guarantee of payment in full when due and not merely a
guarantee of collectability.
SECTION 11.02. Execution and Delivery of the Guarantees.
To further evidence the Guarantees set forth in Section 11.01, each
Guarantor hereby agrees that a notation of such Guarantees, substantially in the
form included in Exhibit A hereto, shall be endorsed on each Note authenticated
and delivered by the Trustee. The validity and enforceability of any Guarantee
shall not be affected by the fact that it is not affixed to any particular Note.
118
-109-
Each of the Guarantors hereby agrees that its Guarantee set forth in
Section 11.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Note a notation of such Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Note no longer holds that office at the time the Trustee authenticates such Note
or at any time thereafter, such Guarantor's Guarantee of such Note shall be
valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantees set forth in
this Indenture on behalf of the Guarantors.
SECTION 11.03. Additional Guarantors.
Any Person may become a Guarantor by executing and delivering to the
Trustee (a) a supplemental indenture in form and substance satisfactory to the
Trustee, which subjects such Person to the provisions of this Indenture as a
Guarantor, and (b) an Opinion of Counsel to the effect that such supplemental
indenture has been duly authorized and executed by such Person and constitutes
the legal, valid, binding and enforceable obligation of such Person (subject to
such customary exceptions concerning fraudulent conveyance laws, creditors'
rights and equitable principles as may be acceptable to the Trustee in its
discretion).
SECTION 11.04. Limitation of Guarantors' Liability.
The obligations of each Guarantor are limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such
Guarantor (other than liabilities of such Guarantor under Indebtedness which
constitutes Subordinated Indebtedness with respect to its Guarantee) and after
giving effect to any collections from or payments made by or on behalf of any
other Guarantor in respect of the obligations of such other Guarantor under its
Guarantee or pursuant to Section 11.06, result in the obligations of such
Guarantor under such Guarantee not constituting a fraudulent conveyance or
fraudulent transfer under federal or state law. Each Guarantor that makes a
payment or distribution under a Guarantee shall be entitled to a contribution
from each other Guarantor in a pro rata amount based on the Adjusted Net Assets
of each Guarantor.
119
-110-
SECTION 11.05. Guarantors May Consolidate, etc., on
Certain Terms; Release from Guarantee.
(a) Each Guarantor may consolidate with or merge into or sell all or
substantially all of its assets to the Issuer or another Guarantor (other than
Caterair) without limitation. Each Guarantor may consolidate with or merge into
or sell all or substantially all of its assets to a corporation other than the
Issuer or another Guarantor (whether or not affiliated with such Guarantor, but
subject to the provisions of Section 11.05(b)); provided that (a) (i) such
transaction is treated as an Asset Sale or Caterair Asset Sale, as the case may
be, for purposes of Section 4.16 hereof or (ii) if the surviving corporation is
not such Guarantor, the surviving corporation agrees to assume such Guarantor's
obligations under its Guarantee and all of its obligations under this Indenture
and (b) such transaction does not (i) violate any covenants set forth in Article
Four or Article Five of this Indenture or (ii) result in a Default or Event of
Default under Article Six of this Indenture immediately thereafter that is
continuing.
(b) Upon (i) the release by the lenders under the Senior Bank
Financing, related documents and future refinancings thereof of all guarantees
of a Guarantor (other than Caterair) and all Liens on the property and assets of
such Guarantor relating to such Indebtedness, or (ii) the sale or disposition
(whether by merger, stock purchase, asset sale or otherwise) of a Guarantor (or
substantially all of its assets) to an entity which is not a Subsidiary of the
Issuer or Caterair (which sale or disposition is otherwise in compliance with
this Indenture), such Guarantor shall be deemed released from all of its
obligations under its Guarantee; provided, however, that any such termination
shall occur only to the extent that all obligations of such Guarantor under the
Senior Bank Financing and all of its guarantees of, and under all of its pledges
of assets or other security interests which secure, such Indebtedness of the
Issuer shall also terminate upon such release, sale or transfer.
(c) The Trustee shall, at the Issuer's expense, deliver an appropriate
instrument evidencing such release upon receipt of a request by the Issuer
accompanied by an Officers' Certificate certifying as to the compliance with
this Section 11.05. Any Guarantor not so released remains liable for the full
amount of principal of and interest on the Notes as provided in this Article
Eleven.
120
-111-
SECTION 11.06. Contribution.
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under its
Guarantee, such Funding Guarantor shall be entitled, so long as the exercise of
such right does not impair the rights of the Holders under the Guarantees, to a
contribution from all other Guarantors in a pro rata amount based on the
Adjusted Net Assets of each Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by that Funding Guarantor in discharging
the Issuer's obligations with respect to the Notes or any other Guarantor's
obligations with respect to the Guarantees; provided that such Funding
Guarantor's contribution right with respect to any such Guarantor shall be
subordinated in right of payment to such Guarantor's Guarantor Senior Debt on
the same basis as its Guarantee is subordinated to Guarantor Senior Debt
pursuant to Article Twelve.
SECTION 11.07. Waiver of Subrogation.
Each Guarantor hereby irrevocably waives any claim or other rights
which it may now or hereafter acquire against the Issuer that arise from the
existence, payment, performance or enforcement of such Guarantor's obligations
under the Guarantees and this Indenture, including, without limitation, any
right of subrogation, reimbursement, exoneration, indemnification, and any right
to participate in any claim or remedy of any Holder of Notes against the Issuer,
whether or not such claim, remedy or right arises in equity, or under contract,
statute or common law, including, without limitation, the right to take or
receive from the Issuer, directly or indirectly, in cash or other property or by
set-off or in any other manner, payment or security on account of such claim or
other rights. If any amount shall be paid to any Guarantor in violation of the
preceding sentence and the Notes shall not have been paid in full, such amount
shall have been deemed to have been paid to such Guarantor for the benefit of,
and held in trust for the benefit of, the Holders of the Notes, and shall,
subject to the provisions of Article Twelve, forthwith be paid to the Trustee
for the benefit of such Holders to be credited and applied upon the Notes,
whether matured or unmatured, in accordance with the terms of this Indenture.
Each Guarantor acknowledges that it will receive direct or indirect benefits
from the financing arrangements contemplated by this Indenture and that the
waiver set forth in this Section 11.07 is knowingly made in contemplation of
such benefits.
121
-112-
ARTICLE TWELVE
SUBORDINATION OF GUARANTEES
SECTION 12.01. Guarantee Obligations Subordinated
to Guarantor Senior Debt.
Each Guarantor covenants and agrees and the Trustee and each Holder of
the Notes, by its acceptance thereof, likewise covenants and agrees, that all
Guarantees shall be issued subject to the provisions of this Article Twelve; and
the Trustee and each Person holding any Guarantee, whether upon original issue
or upon transfer, assignment or exchange thereof, accepts and agrees that the
payment of all Obligations on the Notes pursuant to the Guarantees made by or on
behalf of any Guarantor shall, to the extent and in the manner herein set forth,
be subordinated and junior in right of payment to the prior payment in full in
cash or Cash Equivalents (or such payment shall be duly provided for to the
satisfaction of the holders of the Guarantor Senior Debt of such Guarantor) of
all existing and future Obligations on the Guarantor Senior Debt of such
Guarantor; that the subordination is for the benefit of, and shall be
enforceable directly by, the holders of Guarantor Senior Debt of such Guarantor,
and that each holder of Guarantor Senior Debt of such Guarantor whether now
outstanding or hereafter created, incurred, assumed or guaranteed shall be
deemed to have acquired Guarantor Senior Debt of such Guarantor in reliance upon
the covenants and provisions contained in this Indenture and the Guarantees.
This Section 12.01 and the following Sections 12.02 through 12.15 of
this Article Twelve shall constitute a continuing offer to all Persons who, in
reliance upon such provisions, become holders of, or continue to hold Guarantor
Senior Debt of any Guarantor and, to the extent set forth in Section 12.02,
holders of Designated Guarantor Senior Debt; and such provisions are made for
the benefit of the holders of Guarantor Senior Debt of each Guarantor and, to
the extent set forth in 12.02, holders of Designated Guarantor Senior Debt; and
such holders (to such extent) are made obligees hereunder and they or each of
them may enforce such provisions.
SECTION 12.02. No Payment on Guarantees in Certain
Circumstances.
(a) If any default occurs and is continuing in the payment when due,
whether at maturity, upon any redemption, by
122
-113-
declaration or otherwise, of any principal of, interest on, unpaid drawings for
letters of credit issued in respect of, or regularly accruing fees with respect
to, Guarantor Senior Debt of any Guarantor, no payment of any kind or character
shall be made by or on behalf of such Guarantor or any other Person on behalf of
such Guarantor with respect to any Obligations of such Guarantor on the Notes or
under the Guarantee of such Guarantor or to acquire any of the Notes for cash or
property or otherwise. In addition, if any other event of default occurs and is
continuing with respect to Designated Guarantor Senior Debt of any Guarantor, as
such event of default is defined in the instrument creating or evidencing such
Designated Guarantor Senior Debt, permitting the holders of such Designated
Guarantor Senior Debt then outstanding to accelerate the maturity thereof and if
the Representative for the respective issue of Designated Guarantor Senior Debt
gives written notice of the event of default to the Trustee (a "Guarantor
Default Notice"), then, unless and until all events of default have been cured
or waived or have ceased to exist or the Trustee receives notice from the
Representative for the respective issue of Designated Guarantor Senior Debt
terminating the Guarantor Blockage Period (as defined below), during the 180
days after the delivery of such Guarantor Default Notice (the "Guarantor
Blockage Period"), neither such Guarantor nor any other Person on behalf of such
Guarantor shall (x) make any payment of any kind or character with respect to
any Obligations of such Guarantor on the Notes or under the Guarantee of such
Guarantor or (y) acquire any of the Notes for cash or property or otherwise.
Notwithstanding anything herein to the contrary, in no event will a Guarantor
Blockage Period extend beyond 180 days from the date such Guarantor Blockage
Period was commenced and only one such Guarantor Blockage Period with respect to
such Guarantor may be commenced within any 360 consecutive days. No event of
default which existed or was continuing on the date of the commencement of any
Guarantor Blockage Period with respect to the Designated Guarantor Senior Debt
shall be, or be made, the basis for commencement of a second Guarantor Blockage
Period by the Representative of such Designated Guarantor Senior Debt whether or
not within a period of 360 consecutive days, unless such event of default shall
have been cured or waived for a period of not less than 90 consecutive days (it
being acknowledged that any subsequent action, or any breach of any financial
covenants for a period commencing after the date of commencement of such
Guarantor Blockage Period that, in either case, would give rise to an event of
default pursuant to any provision under which an event of default previously
existed or was continuing shall constitute a new event of default for this
purpose).
123
-114-
(b) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder of a Guarantee when such payment is
prohibited by Section 12.02(a), such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of such
Guarantor Senior Debt (pro rata to such holders on the basis of the respective
amount of such Guarantor Senior Debt held by such holders) or their respective
Representatives, as their respective interests may appear. The Trustee shall be
entitled to rely on information regarding amounts then due and owing on such
Guarantor Senior Debt, if any, received from the holders of such Guarantor
Senior Debt (or their Representatives) or, if such information is not received
from such holders or their Representatives, from the Issuer or the Guarantors
and only amounts included in the information provided to the Trustee shall be
paid to the holders of such Guarantor Senior Debt.
(c) Nothing contained in this Article Twelve shall limit the right of
the Trustee or the Holders of Notes to take any action to accelerate the
maturity of the Notes pursuant to Section 6.02 or to pursue any rights or
remedies hereunder; provided that all Guarantor Senior Debt thereafter due or
declared to be due shall first be paid in full in cash or Cash Equivalents
before the Holders are entitled to receive any payment with respect to
Obligations on the Guarantees.
SECTION 12.03. Payment Over of Proceeds upon
Dissolution, etc.
(a) Upon any payment or distribution of assets of any Guarantor of any
kind or character, whether in cash, property or securities, to creditors upon
any liquidation, dissolution, winding-up, reorganization, assignment for the
benefit of creditors or marshalling of assets of any Guarantor or in a
bankruptcy, reorganization, insolvency, receivership or other similar proceeding
relating to any Guarantor or its property, whether voluntary or involuntary, all
Obligations due or to become due upon all Guarantor Senior Debt of such
Guarantor shall first be paid in full in cash or Cash Equivalents (or such
payment duly provided for to the satisfaction of the holders of the Guarantor
Senior Debt of such Guarantor) before any payment or distribution of any kind or
acter is made on account of any Obligations of such Guarantor on its Guarantee,
or for the acquisition of any of the Notes for cash or property or otherwise.
Upon any such dissolution, winding-up, liquidation, reorganization, receivership
or similar proceeding, any payment or distribution of assets of any Guarantor of
any kind or char-
124
-115-
acter, whether in cash, property or securities, to which the Holders of the
Guarantees or the Trustee under this Indenture would be entitled, except for the
provisions hereof, shall be paid by such Guarantor or by any receiver, trustee
in bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the Holders of the Guarantees or by the Trustee under this
Indenture if received by them, directly to the holders of Guarantor Senior Debt
of such Guarantor (pro rata to such holders on the basis of the respective
amounts of such Guarantor Senior Debt held by such holders) or their respective
Representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Guarantor Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of such
Guarantor Senior Debt remaining unpaid until all such Guarantor Senior Debt has
been paid in full in cash or Cash Equivalents after giving effect to any
concurrent payment, distribution or provision therefor to or for the holders of
such Guarantor Senior Debt.
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of any Guarantor of any kind or character, whether in
cash, property or securities, shall be received by any Holder when such payment
or distribution is prohibited by Section 12.03(a), such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of Guarantor Senior Debt of such Guarantor (pro rata to such
holders on the basis of the respective amount of such Guarantor Senior Debt held
by such holders) or their respective Representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Guarantor Senior Debt
may have been issued, as their respective interests may appear, for application
to the payment of such Guarantor Senior Debt remaining unpaid until all such
Guarantor Senior Debt has been paid in full in cash or Cash Equivalents, after
giving effect to any concurrent payment, distribution or provision therefor to
or for the holders of such Guarantor Senior Debt.
(c) To the extent any payment of Guarantor Senior Debt (whether by or
on behalf of any Guarantor, as proceeds of security or enforcement of any right
of setoff or otherwise) is declared to be fraudulent or preferential, set aside
or required to be paid to any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then, if such payment is
recovered by, or paid over to, such receiver, trustee in bankruptcy, liquidating
trustee,
125
-116-
agent or other similar Person, the Guarantor Senior Debt or part thereof
originally intended to be satisfied shall be deemed to be reinstated and
outstanding as if such payment had not occurred.
(d) The consolidation of any Guarantor with, or the merger of any
Guarantor with or into, another corporation or the liquidation or dissolution of
any Guarantor following the conveyance or transfer of all or substantially all
of its assets, to another corporation which complies with the terms and
conditions provided in Section 11.05 and which does not violate any other
Obligation of such Guarantor under this Indenture or Guarantee of such Guarantor
and as long as permitted under the terms of the Guarantor Senior Debt of such
Guarantor shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section 12.03 if such other corporation
shall, as a part of such consolidation, merger, conveyance or transfer, assume
such Guarantor's obligations hereunder in accordance with Section 11.05.
SECTION 12.04. Payments May Be Paid Prior to Dissolution.
Subject to Sections 12.02(b) and 12.03(b), nothing contained in this
Article Twelve or elsewhere in this Indenture shall prevent (i) a Guarantor,
except under the conditions described in Sections 12.02 and 12.03, from making
payments at any time for the purpose of making payments of principal of and
interest on the Notes, or from depositing with the Trustee any moneys for such
payments, or (ii) in the absence of actual knowledge by the Trustee that a given
payment would be prohibited by Section 12.02 and 12.03, the application by the
Trustee of any moneys deposited with it for the purpose of making such payments
of principal of, and interest on, the Notes to the Holders entitled thereto
unless at least two Business Days prior to the date upon which such payment
would otherwise become due and payable, the Trustee shall have actually received
the written notice provided for in the second sentence of Section 12.02(a) or in
Section 12.09. A Guarantor shall give prompt written notice to the Trustee of
any dissolution, winding-up, liquidation or reorganization of such Guarantor.
SECTION 12.05. Subrogation.
Subject to the payment in full in cash or Cash Equivalents of all
Guarantor Senior Debt of a Guarantor, the Holders of the Guarantees shall be
subrogated to the rights of the holders of such Guarantor Senior Debt to
receive payments or distributions of cash, property or securities of such Guar-
126
-117-
antor applicable to the Guarantor Senior Debt of a Guarantor until the Notes
shall be paid in full; and, for the purposes of such subrogation, no such
payments or distributions to the holders of such Guarantor Senior Debt by or on
behalf of such Guarantor or by or on behalf of the Holders of the Guarantees by
virtue of this Article Twelve which otherwise would have been made to such
Holders of the Guarantees shall, as between such Guarantor and the Holders of
the Guarantees, be deemed to be a payment by such Guarantor to or on account of
the Guarantor Senior Debt of a Guarantor.
SECTION 12.06. Guarantee Provisions Solely To Define
Relative Rights.
The subordination provisions of this Article Twelve are and are
intended solely for the purpose of defining the relative rights of the Holders
of the Notes on the one hand and the holders of Guarantor Senior Debt of each
Guarantor and, to the extent set forth in Section 12.02, holders of Designated
Guarantor Senior Debt of each Guarantor, on the other hand. Nothing contained in
this Article Twelve or elsewhere in this Indenture or in the Notes is intended
to or shall (a) impair, as among any Guarantor, its creditors other than holders
of its Guarantor Senior Debt and the Holders of the Notes, the obligation of
such Guarantor, which is absolute and unconditional, to make payments to the
Holders in respect of its obligations under its Guarantee as and when the same
shall become due and payable in accordance with their terms; or (b) affect the
relative rights against such Guarantor of the Holders of the Notes and creditors
of such Guarantor other than the holders of the Guarantor Senior Debt of such
Guarantor; or (c) prevent the Trustee or the Holder of any Note from exercising
all remedies otherwise permitted by applicable law upon a Default or an Event of
Default under this Indenture, subject to the rights, if any, under the
subordination provisions of this Article Twelve of the holders of Guarantor
Senior Debt of such Guarantor hereunder and, to the extent set forth in Section
12.02, holders of Designated Guarantor Senior Debt of such Guarantor (1) in any
case, proceeding, dissolution, liquidation or other winding-up, assignment for
the benefit of creditors or other marshalling of assets and liabilities of such
Guarantor referred to in Section 12.03, to receive, pursuant to and in
accordance with such Section, cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder, or (2) under the conditions specified
in Section 12.02, to prevent any payment prohibited by such Section or enforce
their rights pursuant to Section 12.02(c).
127
-118-
The failure by any Guarantor to make a payment in respect of its
obligations under its Guarantee by reason of any provision of this Article
Twelve shall not be construed as preventing the occurrence of a Default or an
Event of Default hereunder.
SECTION 12.07. Trustee To Effectuate Subordination
of Obligations Under the Guarantees.
Each Holder of a Note by its acceptance of such Note authorizes and
expressly directs the Trustee to take on behalf of such Holder of Notes such
action as may be necessary or appropriate to effectuate as between the holders
of Guarantor Senior Debt and Holders of Notes, the subordination provided in
this Article Twelve, and appoints the Trustee its attorney-in-fact to act for it
and on its behalf for such purposes, including, in the event of any dissolution,
winding-up, liquidation or reorganization of any Guarantor (whether in
bankruptcy, insolvency, receivership, reorganization or similar proceedings or
upon an assignment for the benefit of creditors or, otherwise) tending towards
liquidation of the business and assets of such Guarantor, the filing of a claim
for the unpaid balance of its Guarantee and accrued interest in the form
required in those proceedings.
If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of the Guarantor Senior Debt
or their Representative are or is hereby authorized to have the right to file
and are or is hereby authorized to file an appropriate claim for and on behalf
of the Holders of said Notes. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Guarantor Senior Debt or their
Representative to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof, or to authorize the
Trustee or the holders of Guarantor Senior Debt or their Representative to vote
in respect of the claim of any Holder in any such proceeding.
SECTION 12.08. No Waiver of Guarantee Subordination
Provisions.
No right of any present or future holder of any Guarantor Senior Debt
of any Guarantor to enforce subordination as provided herein shall at any time
in any way be prejudiced or impaired by any act or failure to act on the part of
the Issuer
128
-119-
or such Guarantor or by any act or failure to act, in good faith, by any such
holder, or by any non-compliance by the Issuer or such Guarantor with the terms
of this Indenture, regardless of any knowledge thereof any such holder may have
or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Guarantor Senior Debt of any Guarantor may, at any time and from
time to time, without the consent of or notice to the Trustee, without incurring
responsibility to the Trustee or the Holders of the Notes and without impairing
or releasing the subordination provided in this Article Twelve or the
obligations hereunder of the Holders of the Guarantees to the holders of such
Guarantor Senior Debt, do any one or more of the following: (1) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, such Guarantor Senior Debt or any Senior Debt as to which such Guarantor
Senior Debt relates, or otherwise amend or supplement in any manner such
Guarantor Senior Debt or any Senior Debt to which such Guarantor Senior Debt
relates; (2) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing such Guarantor Senior Debt or any
Senior Debt as to which such Guarantor Senior Debt relates; (3) release any
person liable in any manner for the collection or payment of such Guarantor
Senior Debt or any Senior Debt as to which such Guarantor Senior Debt relates;
and (4) exercise or refrain from exercising any rights against such Guarantor
and any other Person.
SECTION 12.09. Guarantors To Give Notice to Trustee.
The Issuer and each Guarantor shall give prompt written notice to the
Trustee of any fact known to the Issuer or such Guarantor which would prohibit
the making of any payment to or by the Trustee in respect of the Notes pursuant
to the provisions of this Article Twelve. Notwithstanding the subordination
provisions of this Article Twelve or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any default or
event of default with respect to any Guarantor Senior Debt or of any other facts
which would prohibit the making of any payment to or by the Trustee unless and
until the Trustee shall have received notice in writing from the Issuer, such
Guarantor or from a holder of Guarantor Senior Debt or a Representative
therefor, and, prior to the receipt of any such written notice, the Trustee
shall be entitled to assume (in the absence of actual knowledge to the contrary)
that no such facts exist; provided, however, that if a Trust Officer of the
Trustee shall not have received, at
129
-120-
least two Business Days prior to the date upon which by the terms hereof any
such money may become payable for any purpose, the notice with respect to such
money provided for in this Section 12.09, then, anything herein contained to the
contrary notwithstanding, but otherwise subject to the provisions of Sections
12.02(b) and 12.03(b), the Trustee shall have full power and authority to
receive such money and to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the contrary which may be
received by it within two Business Days prior to such date.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Guarantor
Senior Debt (or a trustee or agent on behalf of such holder) to establish that
such notice has been given by a holder of Guarantor Senior Debt (or a trustee or
agent on behalf of any such holder). In the event that the Trustee determines in
good faith that any evidence is required with respect to the right of any Person
as a holder of Guarantor Senior Debt of any Guarantor to participate in any
payment or distribution pursuant to this Article Twelve, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of Guarantor Senior Debt of such Guarantor held by such Person,
the extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
this Article Twelve, 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.
SECTION 12.10. Reliance on Judicial Order or Certificate
of Liquidating Agent Regarding Dissolution,
etc., of Guarantors.
Upon any payment or distribution of assets of a Guarantor referred to
in this Article Twelve, the Trustee, subject to the provisions of Article Seven
hereof, and the Holders shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such bankruptcy,
liquidation or reorganization, dissolution, winding-up proceedings are pending,
or upon a certificate of the receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or distribution, delivered to
the Trustee or to the Holders of the Guarantees, for the purpose of ascertaining
the Persons entitled to participate in such payment or distribution, the holders
of Guarantor Senior Debt of such Guarantor and other Indebtedness of such
Guarantor, the amount
130
-121-
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article Twelve.
SECTION 12.11. No Suspension of Remedies.
Nothing contained in this Article Twelve shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Article Six or to pursue any rights or remedies hereunder
or under applicable law, subject to the rights, if any, under this Article
Twelve of the holders, from time to time, of Guarantor Senior Debt of the
Guarantors.
SECTION 12.12. Trustee's Relation to Guarantor
Senior Debt.
The Trustee and any agent of the Trustee shall be entitled to all the
rights set forth in this Article Twelve with respect to any Guarantor Senior
Debt which may at any time be held by it in its individual or any other capacity
to the same extent as any other holder of such Guarantor Senior Debt and nothing
in this Indenture shall deprive the Trustee or any such agent of any of its
rights as such holder.
With respect to the holders of Guarantor Senior Debt, the Trustee
undertakes to perform or to observe only such of its duties, covenants,
responsibilities and obligations as are specifically set forth in this Article
Twelve, and no implied covenants or obligations with respect to the holders of
Guarantor Senior Debt shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary or other duty to the holders of
Guarantor Senior Debt and shall not be liable to any such holders if the Trustee
shall in good faith mistakenly pay over or distribute to Holders of Notes or to
the Issuer or to any other Person cash, property or securities to which any
holders of Senior Debt shall be entitled by virtue of this Article Twelve or
otherwise.
Whenever a distribution is to be made or a notice given to holders or
owners of Guarantor Senior Debt, the distribution may be made and the notice may
be given to their Representative, if any.
131
-122-
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
SECTION 13.02. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telecopier or registered or certified mail, postage prepaid, return receipt
requested, addressed as follows:
if to the Issuer or any of the Guarantors:
c/o SC International Services, Inc.
000 Xxxx Xxxxx
Xxxxxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
with a copy to:
Xxxx Xxxxxxx, Xxxxxxx, Xxxx & Handler
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxxxxxx, Esq.
if to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Trustee Administration
Each of the Issuer, the Guarantors and the Trustee by written notice to
each other such Person may designate additional or different addresses for
notices to such Person. Any notice or communication to the Issuer, the
Guarantors or the Trustee shall be deemed to have been given or made as of the
date so delivered if personally delivered; when receipt is acknowledged, if
faxed; and five (5) calendar days after mailing
132
-123-
if sent by registered or certified mail, postage prepaid (except that a notice
of change of address shall not be deemed to have been given until actually
received by the addressee).
Any notice or communication mailed to a Holder shall be mailed to him
by first class mail or other equivalent means at his address as it appears on
the registration books of the Registrar and shall be sufficiently given to him
if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
SECTION 13.03. Communications by Holders with Other
Holders.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Issuer, the Guarantors, the Trustee, the Registrar and any other Person 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 Issuer to the Trustee to take
any action under this Indenture, other than with respect to the authentication
of the Notes for original issuance on the Issue Date, the Issuer shall furnish
to the Trustee:
(1) an Officers' Certificate, in form and substance satisfactory to the
Trustee, stating that, in the opinion of the signers, all conditions
precedent to be performed by the Issuer, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent to be performed by the Issuer, if any,
provided for in this Indenture relating to the proposed action have been
complied with.
133
-124-
SECTION 13.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture, other than the Officers' Certificate
required by Section 4.06, shall include:
(1) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is reasonably necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether or not, in the opinion of each such
Person, such condition or covenant has been complied with.
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Holders. The Paying Agent
or Registrar may make reasonable rules for its functions.
SECTION 13.07. Legal Holidays.
A "Legal Holiday" used with respect to a particular place of payment is
a Saturday, a Sunday or a day on which banking institutions in New York, New
York or at such place of payment are not required to be open. If a payment date
is a Legal Holiday at such place, payment may be made at such place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
SECTION 13.08. Governing Law.
THIS INDENTURE, THE NOTES AND THE GUARANTEES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED
134
-125-
WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
SECTION 13.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Issuer or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
SECTION 13.10. No Recourse Against Others.
A past, present or future director, officer, employee, stockholder or
incorporator, as such, of the Issuer shall not have any liability for any
obligations of the Issuer under the Notes or this Indenture or for any claim
based on, in respect of or by reason of such obligations or their creations.
Each Holder by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance of the Notes.
SECTION 13.11. Successors.
All agreements of the Issuer in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 13.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together shall represent the
same agreement.
SECTION 13.13. Severability.
In case any one or more of the provisions in this Indenture or in the
Notes shall be held invalid, illegal or unenforceable, in any respect for any
reason, the validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions shall not in any way be affected
or impaired thereby, it being intended that all of the provisions hereof shall
be enforceable to the full extent permitted by law.
135
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
Issuer:
SC INTERNATIONAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Vice President
and Chief Financial and
Administrative Officer
Guarantors:
SKY CHEFS, INC.
By: /s/ Xxxxxx X. Xxx
-----------------------------
Name: Xxxxxx X. Xxx
Title: Authorized Signatory
CATERAIR INTERNATIONAL,
INC. (II)
By: /s/ Xxxxxx X. Xxx
-------------------------------
Name: Xxxxxx X. Xxx
Title: Authorized Signatory
CATERAIR INTERNATIONAL,
CORPORATION
By: /s/ Xxxxxx X. Xxx
---------------------------------
Name: Xxxxxx X. Xxx
Title: Authorized Signatory
136
CATERAIR INTERNATIONAL
TRANSITION CORPORATION
ONEX OHIO ACCEPTANCE CORPORATION
ONEX OHIO FINANCE CORP.
ONEX OHIO FINANCE CORP. II
ONEX OHIO EQUITY CORP.
ONEX OHIO EQUITY CORP. II
ONEX OHIO CREDIT CORP.
ONEX OHIO CREDIT CORP. II
ONEX OHIO CAPITAL CORP.
ONEX OHIO CAPITAL CORP. II
ONEX OHIO FISCAL CORP.
ONEX OHIO FISCAL CORP. II
ONEX OHIO FUNDS CORP.
ONEX OHIO FUNDS CORP. II
ARLINGTON SERVICES, INC.
ARLINGTON SERVICES HOLDING
CORPORATION
SKY CHEFS INTERNATIONAL CORP.
BETHESDA SERVICES, INC
CATERAIR NEW ZEALAND LIMITED
(FORMERLY KNOWN AS BETHESDA
SERVICES HOLDING CORPORATION)
JFK CATERERS, INC.
CATERAIR CONSULTING SERVICES
CORPORATION
WESTERN AIRE CHEF, INC.
CATERAIR AIRPORT PROPERTIES, INC.
CATERAIR ST. XXXXXX HOLDING
CORPORATION
SKY CHEFS ARGENTINE, INC.
By: /s/ Xxxxxx X. Xxx
-------------------------------
Name: Xxxxxx X. Xxx
Title: Authorized Signatory
137
Trustee:
THE BANK OF NEW YORK, as Trustee
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
138
[FORM OF SERIES A NOTE]
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR
SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3), OR (7) UNDER THE SECURITIES
ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 903 OR 904 UNDER
THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE
ORIGINAL ISSUANCE OF THIS NOTE RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A)
TO THE ISSUER THEREOF OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO
A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF
BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR THIS NOTE),
(D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE
904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (F) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT
IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF
THIS NOTE WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE, IF THE
PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUER SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY
REASONABLY REQUIRE 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. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANING GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSI-
139
TORY, OR BY ANY SUCH NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE
OF SUCH SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A
NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT HEREON 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 NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.17 OF THE INDENTURE.
140
EXHIBIT A
[Form of Series A Note]
SC INTERNATIONAL SERVICES, INC.
9 1/4% SENIOR SUBORDINATED NOTE DUE 2007, SERIES A
CUSIP No. 000000XX0 (144A)
X0000XXX0 (Reg.S)
No. $
SC INTERNATIONAL SERVICES, INC., a Delaware corporation (the "Issuer"),
for value received, promises to pay to Cede & Co. or registered assigns, the
principal sum of Dollars, on September 1, 2007
Interest Payment Dates: March 1 and September 1
Record Dates: February 15 and August 15
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
A-1
141
IN WITNESS WHEREOF, the Issuer has caused this 9 1/4% Senior
Subordinated Note due 2007 to be signed manually or by facsimile by its duly
authorized officers.
SC INTERNATIONAL SERVICES, INC.
By: __________________________
Name:
Title:
By: __________________________
Name:
Title:
A-2
142
Trustee's Certificate of Authentication
This is one of the 9 1/4% Senior Subordinated Notes due 2007 referred
to in the within-mentioned Indenture.
Dated: August 28, 0000
XXX XXXX XX XXX XXXX, as Trustee
By:________________________________
Authorized Signatory
A-3
143
(REVERSE OF NOTE)
9 1/4% SENIOR SUBORDINATED NOTE DUE 2007, SERIES A
1. Interest. SC INTERNATIONAL SERVICES, INC., a Delaware
corporation (the "Issuer"), promises to pay interest on the principal amount of
this Note at the rate per annum shown above. Interest on the Notes will accrue
from the most recent date on which interest has been paid or, if no interest has
been paid, from August 28, 1997. The Issuer will pay interest semi-annually in
arrears on each Interest Payment Date, commencing March 1, 1998. Interest will
be computed on the basis of a 360-day year of twelve 30-day months.
The Issuer shall pay interest on overdue principal and on overdue
installments of interest from time to time on demand at the rate borne by the
Notes to the extent lawful.
2. Method of Payment. The Issuer shall pay interest on the Notes
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on the Record Date immediately preceding the Interest Payment
Date even if the Notes are cancelled on registration of transfer or registration
of exchange after such Record Date. Holders must surrender Notes to a Paying
Agent to collect principal payments. The Issuer shall pay principal and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Issuer
may pay principal and interest by its check payable in such U.S. Legal Tender.
The Issuer may deliver any such interest payment to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, The Bank of New York
(the "Trustee") will act as Paying Agent and Registrar. The Issuer may change
any Paying Agent, Registrar or co-Registrar without notice to the Holders. The
Issuer or any of its Subsidiaries may, subject to certain exceptions, act as
Registrar or co-Registrar.
4. Indenture and Guarantees. The Issuer issued the Notes under an
Indenture, dated as of August 15, 1997 (the "Indenture"), among the Issuer, each
of the Guarantors named therein and the Trustee. This Note is one of a duly
authorized issue of Notes of the Issuer designated as its 9 1/4% Senior
Subordinated Notes due 2007 (the "Initial Notes"). The Notes are limited (except
as otherwise provided in the Indenture) in aggregate principal amount to
$300,000,000, which may be issued under the Indenture. The Notes include the
Initial Notes, the
A-4
144
Private Exchange Notes (as defined in the Indenture) and the Unrestricted Notes,
as defined below, issued in exchange for the Initial Notes pursuant to the
Indenture. The Initial Notes, the Private Exchange Notes and the Unrestricted
Notes are treated as a single class of securities under the Indenture.
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code Sections 77aaa-77bbbb) (the "TIA"), as in effect on the date
of the Indenture. Notwithstanding anything to the contrary herein, the Notes are
subject to all such terms, and Holders of Notes are referred to the Indenture
and the TIA for a statement of them. The Notes are senior subordinated unsecured
obligations of the Issuer. Payment on each Note is guaranteed on a senior
subordinated basis, jointly and severally, by the Guarantors pursuant to Article
Eleven of the Indenture.
5. Subordination. The Notes are subordinated in right of payment,
in the manner and to the extent set forth in the Indenture, to the prior payment
in full in cash or Cash Equivalents of all Senior Debt, whether outstanding on
the date of the Indenture or thereafter created, incurred, assumed or
guaranteed. To the extent and in the manner provided in the Indenture, Senior
Debt must be paid before any payment may be made to any Holder of this Note.
Each Holder by his acceptance hereof agrees to be bound by such provisions and
authorizes and expressly directs the Trustee, on his behalf, to take such action
as may be necessary or appropriate to effectuate the subordination provided for
in the Indenture and appoints the Trustee his attorney-in-fact for such
purposes.
6. (a) Optional Redemption. The Notes will be redeemable, at the
Issuer's option, in whole at any time or in part from time to time, on and after
September 1, 2002, upon not less than 30 nor more than 60 days' notice, at the
following redemption prices (expressed as percentages of the principal amount
thereof) (payable in cash) if redeemed during the twelve-month period commencing
on September 1 of the year set forth below, plus, in each case, accrued and
unpaid interest thereon, if any, to the date of redemption:
YEAR PERCENTAGE
---- ----------
2002 ..................................... 104.635%
2003 ..................................... 103.476%
2004 ..................................... 102.318%
2005 ..................................... 101.159%
2006 and thereafter ...................... 100.000%
(b) Optional Redemption Upon Public Equity Offerings. At any time or
from time to time, on or prior to Septem-
A-5
145
ber 1, 2000, the Issuer may, at its option, use the net cash proceeds of one or
more Public Equity Offerings to redeem in the aggregate up to $105 million in
principal amount of the Notes at a redemption price of 109.25% of the principal
amount thereof (payable in cash) plus accrued interest and Additional Interest,
if any, to the date of redemption; provided that (i) at least $195 million in
principal amount of the Notes remains outstanding immediately after any such
redemption and (ii) such redemption is effected not more than 60 days after the
consummation of such Public Equity Offering.
7. Notice of Redemption. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Notes to be redeemed at such Holder's registered address. Notes in
denominations larger than $1,000 may be redeemed in part.
8. Change of Control Offer. In the event of a Change of Control,
upon the satisfaction of the conditions set forth in the Indenture, the Issuer
shall be required to offer to repurchase all of the then outstanding Notes
pursuant to a Change of Control Offer at a purchase price equal to 101% of the
principal amount thereof, plus accrued interest to the date of repurchase.
Holders of Notes which are the subject of such an offer to repurchase shall
receive an offer to repurchase and may elect to have such Notes repurchased in
accordance with the provisions of the Indenture pursuant to and in accordance
with the terms of the Indenture.
9. Limitation on Disposition of Assets. Under certain
circumstances the Issuer and Caterair are required to apply the net proceeds
from Asset Sales or Caterair Asset Sales, as the case may be, to offer to
repurchase Notes at a price equal to 100% of the aggregate principal amount
thereof, plus accrued interest to the date of repurchase.
10. Registration Rights. Pursuant to the Registration Rights
Agreement among the Issuer, the Guarantors and the Initial Purchasers, the
Issuer and the Guarantors will be obligated to consummate the Exchange Offer
pursuant to which the Holder of this Note shall have the right to exchange this
Series A Note for a 9 1/4% Senior Subordinated Note due 2007, Series B, of the
Issuer (an "Unrestricted Note"), which has been registered under the Securities
Act, in like principal amount and having terms identical in all material
respects as the Initial Notes. The Holders of the Initial Notes shall be
entitled to receive certain additional interest payments in the event such
Exchange Offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of the Registration Rights
Agreement.
X-0
000
00. Denominations; Transfer; Exchange. The Notes are in registered
form, without coupons, in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Notes in accordance
with the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay certain
transfer taxes or similar governmental charges payable in connection therewith
as permitted by the Indenture. The Registrar need not register the transfer of
or exchange any Notes during a period beginning 15 days before the mailing of a
redemption notice for any Notes or portions thereof selected for redemption.
12. Persons Deemed Owners. The registered Holder of a Note shall
be treated as the owner of it for all purposes.
13. Unclaimed Money. If money for the payment of principal or
interest remains unclaimed for one year, the Trustee and the Paying Agent will
pay the money back to the Issuer. After that, all liability of the Trustee and
such Paying Agent with respect to such money shall cease.
14. Discharge Prior to Redemption or Maturity. If the Issuer at
any time deposits with the Trustee U.S. Legal Tender or U.S. Government
Obligations sufficient to pay the principal of and interest on the Notes to
redemption or maturity and complies with the other provisions of the Indenture
relating thereto, the Issuer will be discharged from certain provisions of the
Indenture and the Notes (including certain covenants, but excluding its
obligation to pay the principal of and interest on the Notes).
15. Amendment; Supplement; Waiver. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the written
consent of the Holders of at least a majority in aggregate principal amount of
the Notes then outstanding, and any existing Default or Event of Default or
noncompliance with any provision may be waived with the written consent of the
Holders of a majority in aggregate principal amount of the Notes then
outstanding. Without notice to or consent of any Holder, the parties thereto may
amend or supplement the Indenture or the Notes to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Notes in addition
to or in place of certificated Notes, or comply with Article Five or Article
Eleven of the Indenture or make any other change that does not adversely affect
in any material respect the rights of any Holder of a Note.
16. Restrictive Covenants. The Indenture imposes certain
limitations on the ability of the Issuer and its Restricted Subsidiaries and
Caterair and its Subsidiaries to,
A-7
147
among other things, incur additional Indebtedness, make payments in respect of
its Capital Stock or certain Indebtedness, enter into transactions with
Affiliates, create dividend or other payment restrictions affecting Subsidiaries
and merge or consolidate with any other Person, sell, assign, transfer, lease,
convey or otherwise dispose of all or substantially all of its assets or adopt a
plan of liquidation. Such limitations are subject to a number of important
qualifications and exceptions. The Issuer and Caterair must annually report to
the Trustee on compliance with such limitations.
17. Successors. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the Notes and the
Indenture, the predecessor will be released from those obligations.
18. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of Notes then outstanding may declare all the Notes to be due and payable
in the manner, at the time and with the effect provided in the Indenture.
Holders of Notes may not enforce the Indenture or the Notes except as provided
in the Indenture. The Trustee is not obligated to enforce the Indenture or the
Notes unless it has been offered indemnity or security reasonably satisfactory
to it. The Indenture permits, subject to certain limitations therein provided,
Holders of a majority in aggregate principal amount of the Notes then
outstanding to direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Notes notice of any continuing Default or
Event of Default (except a Default in payment of principal or interest) if it
determines in good faith that withholding notice is in their interest.
19. Trustee Dealings with Issuer. The Trustee under the Indenture,
in its individual or any other capacity, may become the owner or pledgee of
Notes and may otherwise deal with the Issuer, Caterair, Subsidiaries of the
Issuer and Caterair, or their respective Affiliates as if it were not the
Trustee.
20. No Recourse Against Others. No past, present or future
stockholder, director, officer, employee or incorporator, as such, of the Issuer
shall have any liability for any obligation of the Issuer under the Notes or the
Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder of a Note by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
X-0
000
00. Authentication. This Note shall not be valid until the
Trustee or authenticating agent manually signs the certificate of
authentication on this Note.
22. Governing Law. The laws of the State of New York shall govern
this Note and the Indenture, without regard to principles of conflict of laws.
23. Abbreviations and Defined Terms. Customary abbreviations may
be used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
24. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Note Identification Procedures, the Issuer has caused CUSIP
numbers to be printed on the Notes as a convenience to the Holders of the Notes.
No representation is made as to the accuracy of such numbers as printed on the
Notes and reliance may be placed only on the other identification numbers
printed hereon.
25. Indenture. Each Holder, by accepting a Note, agrees to be
bound by all of the terms and provisions of the Indenture, as the same may be
amended from time to time. Capitalized terms used herein and not defined herein
have the meanings ascribed thereto in the Indenture.
The Issuer will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture, which has the text of this Note in
larger type. Requests may be made to: SC International Services, Inc., 000 Xxxx
Xxxxx, Xxxxxxxxx, Xxxxx 00000.
A-9
149
[FORM OF NOTATION ON NOTE RELATING TO GUARANTEES]
SENIOR SUBORDINATED GUARANTEES
The Guarantors (as defined in the Indenture (the "Indenture") referred
to in the Note upon which this notation is endorsed and each hereinafter
referred to as a "Guarantor") have unconditionally guaranteed on a senior
subordinated basis (such guarantee by each Guarantor being referred to herein as
the "Guarantee") (i) the due and punctual payment of the principal of and
interest on the Notes, whether at maturity, by acceleration or otherwise, the
due and punctual payment of interest on the overdue principal and interest, if
any, on the Notes, to the extent lawful, and the due and punctual performance of
all other Obligations of the Issuer to the Holders or the Trustee all in
accordance with the terms set forth in Articles Eleven and Twelve of the
Indenture and (ii) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that the same will be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise.
The obligations of each Guarantor to the Holders of Notes and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth and
are expressly subordinated and subject in right of payment to the prior payment
in full in cash or Cash Equivalents of all Guarantor Senior Debt of such
Guarantor, to the extent and in the manner provided, in Articles Eleven and
Twelve of the Indenture, and reference is hereby made to such Indenture for the
precise terms of the Guarantee therein made.
No past, present or future stockholder, director, officer, employee or
incorporator, as such, of any of the Guarantors shall have any liability for any
obligation of the Guarantors under this Guarantee or the Indenture or for any
claim based on, in respect of or by reason of, such obligations or their
creation. Each Holder of a Note by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Guarantees.
The Guarantees shall not be valid or obligatory for any purpose until
the certificate of authentication on the Notes upon which the Guarantees are
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized signatories.
X-00
000
XXXXXXXXXX:
SKY CHEFS, INC.
By:
--------------------------------
Name:
Title:
CATERAIR INTERNATIONAL, INC. (II)
By:
--------------------------------
Name:
Title:
CATERAIR INTERNATIONAL
CORPORATION
By:
--------------------------------
Name:
Title:
X-00
000
XXXXXXXX INTERNATIONAL
TRANSITION CORPORATION
ONEX OHIO ACCEPTANCE CORPORATION
ONEX OHIO FINANCE CORP.
ONEX OHIO FINANCE CORP. II
ONEX OHIO EQUITY CORP.
ONEX OHIO EQUITY CORP. II
ONEX OHIO CREDIT CORP.
ONEX OHIO CREDIT CORP. II
ONEX OHIO CAPITAL CORP.
ONEX OHIO CAPITAL CORP. II
ONEX OHIO FISCAL CORP.
ONEX OHIO FISCAL CORP. II
ONEX OHIO FUNDS CORP.
ONEX OHIO FUNDS CORP. II
ARLINGTON SERVICES, INC.
ARLINGTON SERVICES HOLDING
CORPORATION
SKY CHEFS INTERNATIONAL CORP.
BETHESDA SERVICES, INC
CATERAIR NEW ZEALAND LIMITED
(FORMERLY KNOWN AS BETHESDA
SERVICES HOLDING CORPORATION)
JFK CATERERS, INC.
CATERAIR CONSULTING SERVICES
CORPORATION
WESTERN AIRE CHEF, INC.
CATERAIR AIRPORT PROPERTIES, INC.
CATERAIR ST. XXXXXX HOLDING
CORPORATION
SKY CHEFS ARGENTINE, INC.
By:
--------------------------------------
Name:
Title:
A-12
152
[FORM OF ASSIGNMENT]
I or we assign to
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER
_______________________________
________________________________________________________________________________
(please print or type name and address)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting
and appointing
________________________________________________________________________________
attorney to transfer the Note on the books of the Issuer with full power of
substitution in the premises.
Dated:___________________ _________________________________
NOTICE: The signature on this
assignment must correspond with the name
as it appears upon the face of the
within Note in every particular without
alteration or enlargement or any change
whatsoever and be guaranteed by the
endorser's bank or broker.
Signature Guarantee: _________________________________
A-13
153
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Issuer or Caterair, as
the case may be, pursuant to Section 4.15 or 4.16 of the Indenture, check the
appropriate Box:
Section 4.15 [ ]
Section 4.16 [ ]
If you wish to have a portion of this Note purchased by the Issuer or
Caterair, as the case may be, pursuant to Section 4.15 or 4.16 of the Indenture,
state the amount you wish to have purchased:
US$____________
Date: _______________ Your Signature _______________________
(Sign exactly as your name
appears on the other side
of this Note)
Signature Guarantee: _______________________
X-00
000
XXXXXXX B
[Form of Series B Note]
SC INTERNATIONAL SERVICES, INC.
9 1/4% SENIOR SUBORDINATED NOTE DUE 2007, SERIES B
CUSIP No. _________
No. $
SC INTERNATIONAL SERVICES, INC., a Delaware corporation (the "Issuer"),
for value received, promises to pay to Cede & Co. or registered assigns, the
principal sum of Dollars, on September 1, 2007
Interest Payment Dates: March 1 and September 1
Record Dates: February 15 and August 15
Reference is made to the further provisions of this Note contained
herein, which will for all purposes have the same effect as if set forth at this
place.
B-1
155
IN WITNESS WHEREOF, the Issuer has caused this 9 1/4% Senior
Subordinated Note due 2007 to be signed manually or by facsimile by its duly
authorized officers.
SC INTERNATIONAL SERVICES, INC.
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
B-2
156
Trustee's Certificate of Authentication
This is one of the 9 1/4% Senior Subordinated Notes due 2007 referred
to in the within-mentioned Indenture.
Dated:
THE BANK OF NEW YORK, as Trustee
By:
---------------------------------
Authorized Signatory
B-3
157
(REVERSE OF NOTE)
9 1/4% SENIOR SUBORDINATED NOTE DUE 2007, SERIES B
1. Interest. SC INTERNATIONAL SERVICES, INC., a Delaware
corporation (the "Issuer"), promises to pay interest on the principal amount of
this Note at the rate per annum shown above. Interest on the Notes will accrue
from the most recent date on which interest has been paid or, if no interest has
been paid, from August 28, 1997. The Issuer will pay interest semi-annually in
arrears on each Interest Payment Date, commencing March 1, 1998. Interest will
be computed on the basis of a 360-day year of twelve 30-day months.
The Issuer shall pay interest on overdue principal and on overdue
installments of interest from time to time on demand at the rate borne by the
Notes to the extent lawful.
2. Method of Payment. The Issuer shall pay interest on the Notes
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on the Record Date immediately preceding the Interest Payment
Date even if the Notes are cancelled on registration of transfer or registration
of exchange after such Record Date. Holders must surrender Notes to a Paying
Agent to collect principal payments. The Issuer shall pay principal and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Issuer
may pay principal and interest by its check payable in such U.S. Legal Tender.
The Issuer may deliver any such interest payment to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, The Bank of New York
(the "Trustee") will act as Paying Agent and Registrar. The Issuer may change
any Paying Agent, Registrar or co-Registrar without notice to the Holders. The
Issuer or any of its Subsidiaries may, subject to certain exceptions, act as
Registrar or co-Registrar.
4. Indenture and Guarantees. The Issuer issued the Notes under an
Indenture dated as of August 15, 1997 (the "Indenture"), among the Issuer, each
of the Guarantors named therein and the Trustee. This Note is one of a duly
authorized issue of Notes of the Issuer designated as its 9 1/4% Senior
Subordinated Notes due 2007, Series B (the "Unrestricted Notes"). The Notes are
limited (except as otherwise provided in the Indenture) in aggregate principal
amount to $300,000,000, which may be issued under the Indenture. The Notes
include the 9 1/4%
B-4
158
Senior Subordinated Notes due 2007, Series A (the "Initial Notes"), the Private
Exchange Notes (as defined in the Indenture) and the Unrestricted Notes issued
in exchange for the Initial Notes pursuant to the Indenture. The Initial Notes,
the Private Exchange Notes and the Unrestricted Notes are treated as a single
class of securities under the Indenture. Capitalized terms herein are used as
defined in the Indenture unless otherwise defined herein. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77bbbb) (the "TIA"), as in effect on the date of the Indenture.
Notwithstanding anything to the contrary herein, the Notes are subject to all
such terms, and Holders of Notes are referred to the Indenture and the TIA for a
statement of them. The Notes are senior subordinated unsecured obligations of
the Issuer. Payment on each Note is guaranteed on a senior subordinated basis,
jointly and severally, by the Guarantors pursuant to Article Eleven of the
Indenture.
5. Subordination. The Notes are subordinated in right of payment,
in the manner and to the extent set forth in the Indenture, to the prior payment
in full in cash or Cash Equivalents of all Senior Debt, whether outstanding on
the date of the Indenture or thereafter created, incurred, assumed or
guaranteed. To the extent and in the manner provided in the Indenture, Senior
Debt must be paid before any payment may be made to any Holder of this Note.
Each Holder by his acceptance hereof agrees to be bound by such provisions and
authorizes and expressly directs the Trustee, on his behalf, to take such action
as may be necessary or appropriate to effectuate the subordination provided for
in the Indenture and appoints the Trustee his attorney-in-fact for such
purposes.
6. (a) Optional Redemption. The Notes will be redeemable, at the
Issuer's option, in whole at any time or in part from time to time, on and after
September 1, 2002, upon not less than 30 nor more than 60 days' notice, at the
following redemption prices (expressed as percentages of the principal amount
thereof) (payable in cash) if redeemed during the twelve-month period commencing
on September 1 of the year set forth below, plus, in each case, accrued and
unpaid interest thereon, if any, to the date of redemption:
YEAR PERCENTAGE
---- ----------
2002 ..................................... 104.635%
2003 ..................................... 103.476%
2004 ..................................... 102.318%
2005 ..................................... 101.159%
2006 and thereafter ...................... 100.000%
B-5
159
(b) Optional Redemption Upon Public Equity Offerings. At any time
or from time to time, on or prior to September 1, 2000, the Issuer may, at its
option, use the net cash proceeds of one or more Public Equity Offerings to
redeem in the aggregate up to $105 million in principal amount of the Notes at a
redemption price of 109.25% of the principal amount thereof (payable in cash)
plus accrued interest and Additional Interest, if any, to the date of
redemption; provided that (i) at least $195 million in principal amount of the
Notes remains outstanding immediately after any such redemption and (ii) such
redemption is effected not more than 60 days after the consummation of such
Public Equity Offering.
7. Notice of Redemption. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Notes to be redeemed at such Holder's registered address. Notes in
denominations larger than $1,000 may be redeemed in part.
8. Change of Control Offer. In the event of a Change of Control,
upon the satisfaction of the conditions set forth in the Indenture, the Issuer
shall be required to offer to repurchase all of the then outstanding Notes
pursuant to a Change of Control Offer at a purchase price equal to 101% of the
principal amount thereof, plus accrued interest to the date of repurchase.
Holders of Notes which are the subject of such an offer to repurchase shall
receive an offer to repurchase and may elect to have such Notes repurchased in
accordance with the provisions of the Indenture pursuant to and in accordance
with the terms of the Indenture.
9. Limitation on Disposition of Assets. Under certain
circumstances the Issuer and Caterair are required to apply the net proceeds
from Asset Sales or Caterair Asset Sales, as the case may be, to offer to
repurchase Notes at a price equal to 100% of the aggregate principal amount
thereof, plus accrued interest to the date of repurchase.
10. Denominations; Transfer; Exchange. The Notes are in registered
form, without coupons, in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Notes in accordance
with the Indenture. The Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay certain
transfer taxes or similar governmental charges payable in connection therewith
as permitted by the Indenture. The Registrar need not register the transfer of
or exchange any Notes during a period beginning 15 days before the mailing of a
redemption notice for any Notes or portions thereof selected for redemption.
B-6
160
11. Persons Deemed Owners. The registered Holder of a Note shall
be treated as the owner of it for all purposes.
12. Unclaimed Money. If money for the payment of principal or
interest remains unclaimed for one year, the Trustee and the Paying Agent will
pay the money back to the Issuer. After that, all liability of the Trustee and
such Paying Agent with respect to such money shall cease.
13. Discharge Prior to Redemption or Maturity. If the Issuer at
any time deposits with the Trustee U.S. Legal Tender or U.S. Government
Obligations sufficient to pay the principal of and interest on the Notes to
redemption or maturity and complies with the other provisions of the Indenture
relating thereto, the Issuer will be discharged from certain provisions of the
Indenture and the Notes (including certain covenants, but excluding its
obligation to pay the principal of and interest on the Notes).
14. Amendment; Supplement; Waiver. Subject to certain exceptions,
the Indenture or the Notes may be amended or supplemented with the written
consent of the Holders of at least a majority in aggregate principal amount of
the Notes then outstanding, and any existing Default or Event of Default or
noncompliance with any provision may be waived with the written consent of the
Holders of a majority in aggregate principal amount of the Notes then
outstanding. Without notice to or consent of any Holder, the parties thereto may
amend or supplement the Indenture or the Notes to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Notes in addition
to or in place of certificated Notes, or comply with Article Five or Article
Eleven of the Indenture or make any other change that does not adversely affect
in any material respect the rights of any Holder of a Note.
15. Restrictive Covenants. The Indenture imposes certain
limitations on the ability of the Issuer and its Restricted Subsidiaries and
Caterair and its Subsidiaries to, among other things, incur additional
Indebtedness, make payments in respect of its Capital Stock or certain
Indebtedness, enter into transactions with Affiliates, create dividend or other
payment restrictions affecting Subsidiaries and merge or consolidate with any
other Person, sell, assign, transfer, lease, convey or otherwise dispose of all
or substantially all of its assets or adopt a plan of liquidation. Such
limitations are subject to a number of important qualifications and exceptions.
The Issuer and Caterair must annually report to the Trustee on compliance with
such limitations.
16. Successors. When a successor assumes, in accordance with the
Indenture, all the obligations of its predeces-
B-7
161
sor under the Notes and the Indenture, the predecessor will be released from
those obligations.
17. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of Notes then outstanding may declare all the Notes to be due and payable
in the manner, at the time and with the effect provided in the Indenture.
Holders of Notes may not enforce the Indenture or the Notes except as provided
in the Indenture. The Trustee is not obligated to enforce the Indenture or the
Notes unless it has been offered indemnity or security reasonably satisfactory
to it. The Indenture permits, subject to certain limitations therein provided,
Holders of a majority in aggregate principal amount of the Notes then
outstanding to direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Notes notice of any continuing Default or
Event of Default (except a Default in payment of principal or interest) if it
determines in good faith that withholding notice is in their interest.
18. Trustee Dealings with Issuer. The Trustee under the Indenture,
in its individual or any other capacity, may become the owner or pledgee of
Notes and may otherwise deal with the Issuer, Caterair, Subsidiaries of the
Issuer and Caterair, or their respective Affiliates as if it were not the
Trustee.
19. No Recourse Against Others. No past, present or future
stockholder, director, officer, employee or incorporator, as such, of the Issuer
shall have any liability for any obligation of the Issuer under the Notes or the
Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder of a Note by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
20. Authentication. This Note shall not be valid until the Trustee
or authenticating agent manually signs the certificate of authentication on this
Note.
21. Governing Law. The laws of the State of New York shall govern
this Note and the Indenture, without regard to principles of conflict of laws.
22. Abbreviations and Defined Terms. Customary abbreviations may
be used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
X-0
000
00. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Note Identification Procedures, the Issuer has caused CUSIP
numbers to be printed on the Notes as a convenience to the Holders of the Notes.
No representation is made as to the accuracy of such numbers as printed on the
Notes and reliance may be placed only on the other identification numbers
printed hereon.
24. Indenture. Each Holder, by accepting a Note, agrees to be
bound by all of the terms and provisions of the Indenture, as the same may be
amended from time to time. Capitalized terms used herein and not defined herein
have the meanings ascribed thereto in the Indenture.
The Issuer will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture, which has the text of this Note in
larger type. Requests may be made to: SC International Services, Inc., 000 Xxxx
Xxxxx, Xxxxxxxxx, Xxxxx 00000.
B-9
163
[FORM OF NOTATION ON NOTE RELATING TO GUARANTEES]
SENIOR SUBORDINATED GUARANTEES
The Guarantors (as defined in the Indenture (the "Indenture") referred
to in the Note upon which this notation is endorsed and each hereinafter
referred to as a "Guarantor") have unconditionally guaranteed on a senior
subordinated basis (such guarantee by each Guarantor being referred to herein as
the "Guarantee") (i) the due and punctual payment of the principal of and
interest on the Notes, whether at maturity, by acceleration or otherwise, the
due and punctual payment of interest on the overdue principal and interest, if
any, on the Notes, to the extent lawful, and the due and punctual performance of
all other Obligations of the Issuer to the Holders or the Trustee all in
accordance with the terms set forth in Articles Eleven and Twelve of the
Indenture and (ii) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that the same will be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at stated maturity, by acceleration or otherwise.
The obligations of each Guarantor to the Holders of Notes and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth and
are expressly subordinated and subject in right of payment to the prior payment
in full in cash or Cash Equivalents of all Guarantor Senior Debt of such
Guarantor, to the extent and in the manner provided, in Articles Eleven and
Twelve of the Indenture, and reference is hereby made to such Indenture for the
precise terms of the Guarantee therein made.
No past, present or future stockholder, director, officer, employee or
incorporator, as such, of any of the Guarantors shall have any liability for any
obligation of the Guarantors under this Guarantee or the Indenture or for any
claim based on, in respect of or by reason of, such obligations or their
creation. Each Holder of a Note by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Guarantees.
The Guarantees shall not be valid or obligatory for any purpose until
the certificate of authentication on the Notes upon which the Guarantees are
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized signatories.
B-10
164
GUARANTORS:
SKY CHEFS, INC.
By:
--------------------------------
Name:
Title:
CATERAIR INTERNATIONAL, INC. (II)
By:
--------------------------------
Name:
Title:
CATERAIR INTERNATIONAL
CORPORATION
By:
--------------------------------
Name:
Title:
B-11
165
CATERAIR INTERNATIONAL
TRANSITION CORPORATION
ONEX OHIO ACCEPTANCE CORPORATION
ONEX OHIO FINANCE CORP.
ONEX OHIO FINANCE CORP. II
ONEX OHIO EQUITY CORP.
ONEX OHIO EQUITY CORP. II
ONEX OHIO CREDIT CORP.
ONEX OHIO CREDIT CORP. II
ONEX OHIO CAPITAL CORP.
ONEX OHIO CAPITAL CORP. II
ONEX OHIO FISCAL CORP.
ONEX OHIO FISCAL CORP. II
ONEX OHIO FUNDS CORP.
ONEX OHIO FUNDS CORP. II
ARLINGTON SERVICES, INC.
ARLINGTON SERVICES HOLDING
CORPORATION
SKY CHEFS INTERNATIONAL CORP.
BETHESDA SERVICES, INC
CATERAIR NEW ZEALAND LIMITED
(FORMERLY KNOWN AS BETHESDA
SERVICES HOLDING CORPORATION)
JFK CATERERS, INC.
CATERAIR CONSULTING SERVICES
CORPORATION
WESTERN AIRE CHEF, INC.
CATERAIR AIRPORT PROPERTIES, INC.
CATERAIR ST. XXXXXX HOLDING
CORPORATION
SKY CHEFS ARGENTINE, INC.
By:
------------------------------------
Name:
Title:
B-12
166
[FORM OF ASSIGNMENT]
I or we assign to
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER
__________________________________
________________________________________________________________________________
(please print or type name and address)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting
and appointing
________________________________________________________________________________
attorney to transfer the Note on the books of the Issuer with full power of
substitution in the premises.
Dated:___________________ _________________________________
NOTICE: The signature on this
assignment must correspond with the name
as it appears upon the face of the
within Note in every particular without
alteration or enlargement or any change
whatsoever and be guaranteed by the
endorser's bank or broker.
Signature Guarantee: _________________________________
B-13
167
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Issuer or Caterair, as
the case may be, pursuant to Section 4.15 or 4.16 of the Indenture, check the
appropriate Box:
Section 4.15 [ ]
Section 4.16 [ ]
If you wish to have a portion of this Note purchased by the Issuer or
Caterair, as the case may be, pursuant to Section 4.15 or 4.16 of the Indenture,
state the amount you wish to have purchased:
US$____________
Date: _______________ Your Signature _______________________
(Sign exactly as your name
appears on the other side
of this Note)
Signature Guarantee: _______________________
B-14
168
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Trustee
Administration
Re: SC International Services,Inc. -
9 1/4 Senior Subordinated Notes due 2007
Ladies and Gentlemen:
In connection with our proposed purchase of 9 1/4% Senior
Subordinated Notes due 2007 (the "Notes") of SC International Services, Inc., a
Delaware corporation (the "Issuer"), we confirm that:
1. We have received a copy of the Offering Memorandum (the
"Offering Memorandum"), dated August 22, 1997, relating to the Notes
and such other information as we deem necessary in order to make our
investment decision. We acknowledge that we have read and agreed to the
matters stated on pages (i)-(ii) of the Offering Memorandum and in the
section entitled "Transfer Restrictions" of such Offering Memorandum.
2. We understand that any subsequent transfer of the Notes is
subject to certain restrictions and conditions set forth in the
Indenture relating to the Notes (the "Indenture") as described in the
Offering Memorandum and the undersigned agrees to be bound by, and not
to resell, pledge or otherwise transfer the Notes except in compliance
with, such restrictions and conditions under the Securities Act of
1933, as amended (the "Securities Act"), and all applicable State
securities laws.
3. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes may not be
offered or sold within the United States or to, or for the account or
benefit of, U.S. persons except as permitted in the following sentence.
We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated,
C-1
169
that if we should sell or otherwise transfer any Notes, we will do so
only (i) to the Issuer or any subsidiary thereof, (ii) inside the
United States in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined in Rule 144A promulgated
under the Securities Act), (iii) inside the United States to an
institutional "accredited investor" (as defined below) that, prior to
such transfer, furnishes (or has furnished on its behalf by a U.S.
broker-dealer) to the Trustee (as defined in the Indenture), a signed
letter containing certain representations and agreements relating to
the restrictions on transfer of the Notes (the form of which letter can
be obtained from the Trustee), (iv) outside the United States in
accordance with Rule 904 of Regulation S promulgated under the
Securities Act to non-U.S. persons, (v) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if
available), or (vi) pursuant to an effective registration statement
under the Securities Act, and we further agree to provide to any person
purchasing any of the Notes from us a notice advising such purchaser
that resales of the Notes are restricted as stated herein.
4. We are not acquiring the Notes for or on behalf of, and
will not transfer the Notes to, any pension or welfare plan (as defined
in Section 3 of the Employee Retirement Income Security Act of 1974),
except as permitted in the section entitled "Transfer Restrictions" of
the Offering Memorandum.
5. We understand that, on any proposed resale of any Notes, we
will be required to furnish to the Trustee and the Issuer such
certification, legal opinions and other information as the Trustee and
the Issuer may reasonably require to confirm that the proposed sale
complies with the foregoing restrictions. We further understand that
the Notes purchased by us will bear a legend to the foregoing effect.
6. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of our
investment in the Notes, and we and any accounts for which we are
acting are each able to bear the economic risk of our or their
investment, as the case may be.
7. We are acquiring the Notes purchased by us for our account
or for one or more accounts (each of which
C-2
170
is an institutional "accredited investor") as to each of which we
exercise sole investment discretion.
C-3
171
You, the Issuer, the Trustee and others are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
By:
---------------------------------
Name:
Title:
C-4
172
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Trustee
Administration
Re: SC International Services, Inc. (the "Issuer")
9 1/4% Senior Subordinated Notes due 2007 (the
"Notes")
Ladies and Gentlemen:
In connection with our proposed sale of [$ ] aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States, or (b) the transaction was executed in, on or through
the facilities of a designated off-shore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer
restrictions applicable to the Notes.
D-1
173
You, the Issuer and counsel for the Issuer are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
--------------------------------
Authorized Signature
D-2
