EXHIBIT 4.1
================================================================================
WESCO DISTRIBUTION, INC.
91/8% Senior Subordinated Notes due 2008
---------
INDENTURE
Dated as of June 5, 1998
---------
BANK ONE, N.A.,
Senior Subordinated Notes Trustee
================================================================================
TABLE OF CONTENTS
Page
----
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions..................................................1
SECTION 1.02. Other Definitions...........................................22
SECTION 1.03. Incorporation by Reference of Trust Indenture Act...........22
SECTION 1.04. Rules of Construction.......................................23
ARTICLE 2
The Senior Subordinated Notes
SECTION 2.01. Amount of Senior Subordinated Notes; Issuable in Series.....24
SECTION 2.02. Form and Dating.............................................25
SECTION 2.03. Execution and Authentication................................25
SECTION 2.04. Registrar and Paying Agent..................................26
SECTION 2.05. Paying Agent To Hold Money in Trust.........................27
SECTION 2.06. Senior Subordinated Noteholder Lists........................27
SECTION 2.07. Transfer and Exchange.......................................27
SECTION 2.08. Replacement Senior Subordinated Notes.......................28
SECTION 2.09. Outstanding Senior Subordinated Notes.......................29
SECTION 2.10. Temporary Senior Subordinated Notes.........................29
SECTION 2.11. Cancelation.................................................29
SECTION 2.12. Defaulted Interest..........................................30
SECTION 2.13. CUSIP Numbers...............................................30
ARTICLE 3
Redemption
SECTION 3.01. Notices to Senior Subordinated Notes Trustee................30
SECTION 3.02. Selection of Senior Subordinated Notes To Be Redeemed.......30
SECTION 3.03. Notice of Redemption........................................31
SECTION 3.04. Effect of Notice of Redemption..............................32
SECTION 3.05. Deposit of Redemption Price.................................32
SECTION 3.06. Senior Subordinated Notes Redeemed in Part..................32
ARTICLE 4
Covenants
SECTION 4.01. Payment of Senior Subordinated Notes........................32
SECTION 4.02. SEC Reports.................................................32
SECTION 4.03. Limitation on Indebtedness..................................33
SECTION 4.04. Limitation on Restricted Payments...........................35
SECTION 4.05. Limitation on Restrictions on Distributions from
Restricted Subsidiaries..................................39
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock..........40
SECTION 4.07. Limitation on Transactions with Affiliates..................43
SECTION 4.08. Change of Control...........................................44
SECTION 4.09. Compliance Certificate......................................46
SECTION 4.10. Further Instruments and Acts................................46
SECTION 4.11. Limitation on the Sale or Issuance of Capital Stock
of Restricted Subsidiaries...............................46
SECTION 4.12. Limitation on Liens.........................................46
ARTICLE 5
Successor Company
SECTION 5.01. When Company May Merge or Transfer Assets...................47
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default...........................................48
SECTION 6.02. Acceleration................................................50
SECTION 6.03. Other Remedies..............................................50
SECTION 6.04. Waiver of Past Defaults.....................................51
SECTION 6.05. Control by Majority.........................................51
SECTION 6.06. Limitation on Suits.........................................51
SECTION 6.07. Rights of Senior Subordinated Noteholders to Receive
Payment .................................................52
SECTION 6.08. Collection Suit by Senior Subordinated Notes Trustee........52
SECTION 6.09. Senior Subordinated Notes Trustee May File Proofs of Claim..52
SECTION 6.10. Priorities..................................................52
SECTION 6.11. Undertaking for Costs.......................................53
SECTION 6.12. Waiver of Stay or Extension Laws............................53
ARTICLE 7
Senior Subordinated Notes Trustee
SECTION 7.01. Duties of Senior Subordinated Notes Trustee.................53
SECTION 7.02. Rights of Senior Subordinated Notes Trustee.................55
SECTION 7.03. Individual Rights of Senior Subordinated Notes Trustee......55
SECTION 7.04. Senior Subordinated Notes Trustee's Disclaimer..............55
SECTION 7.05. Notice of Defaults..........................................56
SECTION 7.06. Reports by Senior Subordinated Notes Trustee to
Senior Subordinated Noteholders..........................56
SECTION 7.07. Compensation and Indemnity..................................56
SECTION 7.08. Replacement of Senior Subordinated Notes Trustee............57
SECTION 7.09. Successor Senior Subordinated Notes Trustee by Merger.......58
SECTION 7.10. Eligibility; Disqualification...............................59
SECTION 7.11. Preferential Collection of Claims Against Company...........59
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Senior Subordinated Notes;
Defeasance...............................................59
SECTION 8.02. Conditions to Defeasance....................................60
SECTION 8.03. Application of Trust Money..................................61
SECTION 8.04. Repayment to Company........................................61
SECTION 8.05. Indemnity for Government Obligations........................61
SECTION 8.06. Reinstatement...............................................61
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Senior Subordinated Noteholders..........62
SECTION 9.02. With Consent of Senior Subordinated Noteholders.............63
SECTION 9.03. Compliance with Trust Indenture Act.........................64
SECTION 9.04. Revocation and Effect of Consents and Waivers...............64
SECTION 9.05. Notation on or Exchange of Senior Subordinated Notes........64
SECTION 9.06. Senior Subordinated Notes Trustee To Sign Amendments........65
ARTICLE 10
Subordination
SECTION 10.01. Agreement To Subordinate...................................65
SECTION 10.02. Liquidation, Dissolution, Bankruptcy.......................65
SECTION 10.03. Default on Senior Indebtedness.............................66
SECTION 10.04. Acceleration of Payment of Senior Subordinated Notes.......67
SECTION 10.05. When Distribution Must Be Paid Over........................67
SECTION 10.06. Subrogation................................................67
SECTION 10.07. Relative Rights............................................67
SECTION 10.08. Subordination May Not Be Impaired by the Company...........68
SECTION 10.09. Rights of Senior Subordinated Notes Trustee and
Paying Agent............................................68
SECTION 10.10. Distribution or Notice to Representative...................68
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit
Right To Accelerate.....................................68
SECTION 10.12. Trust Moneys Not Subordinated..............................68
SECTION 10.13. Senior Subordinated Notes Trustee Entitled To Rely.........69
SECTION 10.14. Senior Subordinated Notes Trustee To Effectuate
Subordination ..........................................69
SECTION 10.15. Senior Subordinated Notes Trustee Not Fiduciary for
Holders of Senior Indebtedness .........................69
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions ...............................69
SECTION 10.17. Senior Subordinated Notes Trustee's Compensation
Not Prejudiced .........................................70
ARTICLE 11
Holdings Guarantee
SECTION 11.01. Holdings Guarantee.........................................70
SECTION 11.02. Limitation on Liability....................................72
SECTION 11.03. Successors and Assigns.....................................72
SECTION 11.04. No Waiver..................................................73
SECTION 11.05. Modification...............................................73
ARTICLE 12
Subordination of the Holdings Guarantee
SECTION 12.01. Agreement To Subordinate...................................73
SECTION 12.02. Liquidation, Dissolution, Bankruptcy.......................73
SECTION 12.03. Default on Designated Senior Indebtedness of Holdings......74
SECTION 12.04. Demand for Payment.........................................75
SECTION 12.05. When Distribution Must Be Paid Over........................75
SECTION 12.06. Subrogation................................................75
SECTION 12.07. Relative Rights............................................75
SECTION 12.08. Subordination May Not Be Impaired by Holdings..............75
SECTION 12.09. Rights of Senior Subordinated Notes Trustee and
Paying Agent ...........................................75
SECTION 12.10. Distribution or Notice to Representative...................76
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit
Right To Accelerate ....................................76
SECTION 12.12. Senior Subordinated Notes Trustee Entitled To Rely.........76
SECTION 12.13. Senior Subordinated Notes Trustee To Effectuate
Subordination ..........................................77
SECTION 12.14. Senior Subordinated Notes Trustee Not Fiduciary for
Holders of Senior Indebtedness of Holdings .............77
SECTION 12.15. Reliance by Holders of Senior Indebtedness of
Holdings on Subordination Provisions ...................77
SECTION 12.16. Defeasance.................................................77
ARTICLE 13
Miscellaneous
SECTION 13.01. Trust Indenture Act Controls...............................77
SECTION 13.02. Notices....................................................78
SECTION 13.03. Communication by Senior Subordinated Noteholders
with Other Senior Subordinated Noteholders .............78
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.........78
SECTION 13.05. Statements Required in Certificate or Opinion..............79
SECTION 13.06. When Senior Subordinated Notes Disregarded.................79
SECTION 13.07. Rules by Senior Subordinated Notes Trustee, Paying
Agent and Registrar ....................................79
SECTION 13.08. Legal Holidays.............................................79
SECTION 13.09. GOVERNING LAW..............................................79
SECTION 13.10. No Recourse Against Others.................................80
SECTION 13.11. Successors.................................................80
SECTION 13.12. Multiple Originals.........................................80
SECTION 13.13. Table of Contents; Headings................................80
Appendix A - Provisions Relating to Original Senior Subordinated Notes,
Additional Senior Subordinated Notes, Private Senior
Subordinated Exchange Notes and Senior Subordinated Exchange
Notes
Exhibit A - Form of Initial Senior Subordinated Note
Exhibit B - Form of Senior Subordinated Exchange Note
Exhibit C - Form of Transferee Letter of Representation
1
INDENTURE dated as of June 5, 1998 , among WESCO
DISTRIBUTION, INC., a Delaware corporation (the "Company"),
WESCO INTERNATIONAL, INC., a Delaware corporation, as
guarantor ("Holdings"), and BANK ONE, N.A., a national banking
association, as trustee (the "Senior Subordinated Notes
Trustee").
Each party agrees as follows for the benefit of the other parties
and for the equal and ratable benefit of the Holders of (i) the Company's 91/8%
Senior Subordinated Notes due 2008 issued on the date hereof (the "Original
Senior Subordinated Notes"), (ii) any Additional Senior Subordinated Notes (as
defined herein) that may be issued on any Senior Subordinated Notes Issue Date
(all such Senior Subordinated Notes in clauses (i) and (ii) being referred to
collectively as the "Initial Senior Subordinated Notes"), (iii) if and when
issued as provided in a Senior Subordinated Notes Registration Agreement (as
defined in Appendix A hereto (the "Appendix")), the Company's 91/8% Senior
Subordinated Notes due 2008 issued in a Senior Subordinated Notes Registered
Exchange Offer (as defined in the Appendix) in exchange for any Initial Senior
Subordinated Notes (the "Senior Subordinated Exchange Notes") and (iv) if and
when issued as provided in a Senior Subordinated Notes Registration Agreement,
the Private Senior Subordinated Exchange Notes (as defined in the Appendix)
issued in a Senior Subordinated Notes Private Exchange (as defined in the
Appendix, and together with the Initial Senior Subordinated Notes and any Senior
Subordinated Exchange Notes issued hereunder, the "Senior Subordinated Notes").
Except as otherwise provided herein, the Senior Subordinated Notes will be
limited to $500 million in aggregate principal amount outstanding, of which $300
million in aggregate principal amount will be initially issued on the date
hereof. Subject to the conditions and in compliance with the covenants set forth
herein, the Company may issue up to $200 million aggregate principal amount of
Additional Senior Subordinated Notes.
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions.
"Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) to be used by the Company or a Restricted
Subsidiary in a Related Business; (ii) the Capital Stock of a Person that
becomes a Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or another Restricted Subsidiary; or (iii) Capital Stock
constituting a minority interest in any Person that at such time is a Restricted
Subsidiary; provided, however, that any such Restricted Subsidiary described in
clause (ii) or (iii) above is primarily engaged in a Related Business.
"Additional Senior Subordinated Notes" means up to $200 million
aggregate principal amount of 91/8% Senior Subordinated Notes due 2008 issued
under the terms of this Indenture subsequent to the Closing Date.
2
"Adjusted Consolidated Assets" means at any time the total amount of
assets of the Company and its Restricted Subsidiaries (less applicable
depreciation, amortization and other valuation reserves), after deducting
therefrom all current liabilities of the Company and its Restricted Subsidiaries
(excluding intercompany items), all as set forth on the Consolidated balance
sheet of the Company and its Restricted Subsidiaries as of the end of the most
recent fiscal quarter for which financial statements are available prior to the
date of determination.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Applicable Premium" means, with respect to a Senior Subordinated
Note at any redemption date, the greater of (i) 1.0% of the principal amount of
such Senior Subordinated Note and (ii) the excess of (A) the present value at
such time of (1) the redemption price of such Senior Subordinated Note at June
1, 2003 (such redemption price being set forth in the table in paragraph 5 of
the Senior Subordinated Notes) plus (2) all required interest payments due on
such Senior Subordinated Note through June 1, 2003 (excluding accrued but unpaid
interest), computed using a discount rate equal to the Treasury Rate plus 50
basis points, over (B) the then-outstanding principal amount of such Senior
Subordinated Note.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation, or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of (i) any shares of Capital
Stock of a Restricted Subsidiary (other than directors' qualifying shares or
shares required by applicable law to be held by a Person other than the Company
or a Restricted Subsidiary), (ii) all or substantially all the assets of any
division or line of business of the Company or any Restricted Subsidiary or
(iii) any other assets of the Company or any Restricted Subsidiary outside the
ordinary course of business of the Company or such Restricted Subsidiary (other
than, in the case of (i), (ii) and (iii) above, (A) a disposition by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Wholly Owned Subsidiary, (B) for purposes of the provisions
described in Section 4.06 only, a disposition subject to Section 4.04, (C) a
disposition of assets with a fair market value of less than $1,000,000, (D) a
sale of accounts receivable and related assets of the type specified in the
definition of "Qualified Receivables Transaction" to a Receivables Entity in a
Qualified Receivables Transaction, (E) a transfer of accounts receivables and
related assets of the type specified in the definition of "Qualified Receivables
Transaction" (or a fractional undivided interest therein) by a Receivables
Entity in a Qualified Receivables Transaction, (F) the disposition of all or
substantially all of the assets of the Company in a manner permitted pursuant to
the provisions of Section 5.01 or any disposition that constitutes a Change of
Control, (G) any exchange of like property pursuant to Section 1031 of the Code
for use in a Related Business, and (H) any sale of Capital Stock in, or
Indebtedness or other securities of, an Unrestricted Subsidiary).
3
"Attributable Debt" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate borne by the Senior Subordinated Notes, compounded annually) of
the total obligations of the lessee for rental payments during the remaining
term of the lease included in such Sale/Leaseback Transaction (including any
period for which such lease has been extended).
"Average Life" means, as of the date of determination, with respect
to any Indebtedness or Preferred Stock, the quotient obtained by dividing (i)
the sum of the products of the numbers of years from the date of determination
to the dates of each successive scheduled principal payment of such Indebtedness
or redemption or similar payment with respect to such Preferred Stock multiplied
by the amount of such payment by (ii) the sum of all such payments.
"Bank Indebtedness" means any and all amounts payable under or in
respect of the Credit Agreement and any Refinancing Indebtedness with respect
thereto, as amended from time to time, including principal, premium (if any),
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not a claim
for post-filing interest is allowed in such proceedings), fees, charges,
expenses, reimbursement obligations, guarantees, indemnities and all other
amounts payable thereunder or in respect thereof.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such Board.
"Business Day" means each day which is not a Legal Holiday.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be prepaid by the lessee
without payment of a penalty.
"Change of Control" means the occurrence of any of the following
events:
(i) prior to the earlier to occur of (A) the first public offering
of common stock of Holdings or (B) the first public offering of common
stock of the Company, the Permitted Holders cease to be the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act),
directly or indirectly, of a majority in the aggregate of the total voting
power of the Voting Stock of the Company or Holdings, whether as a result
of issuance of securities of Holdings or the Company, any merger,
consolidation, liquidation or dissolution of Holdings or the Company, any
direct or indirect transfer of securities by any Permitted Holder or
otherwise (for purposes of this clause (i) and clause (ii) below, the
4
Permitted Holders shall be deemed to beneficially own any Voting Stock of
an entity (the "specified entity") held by any other entity (the "parent
entity") so long as the Permitted Holders beneficially own (as so
defined), directly or indirectly, in the aggregate a majority of the
voting power of the Voting Stock of the parent entity);
(ii) on or after any such public offering referred to in clause (i),
(A) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), other than one or more Permitted Holders, is or becomes the
beneficial owner (as defined in clause (i) above, except that for purposes
of this clause (ii) such person shall be deemed to have "beneficial
ownership" of all shares that any such person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time), directly or indirectly, of more than 35% of the total voting power
of the Voting Stock of the Company or Holdings and (B) the Permitted
Holders "beneficially own" (as defined in clause (i) above), directly or
indirectly, in the aggregate a lesser percentage of the total voting power
of the Voting Stock of the Company or Holdings than such other person and
do not have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the board of directors of
the Company or Holdings, as the case may be (for the purposes of this
clause (ii), such other person shall be deemed to beneficially own any
Voting Stock of a specified corporation held by a parent corporation, if
such other person is the beneficial owner (as defined in this clause
(ii)), directly or indirectly, of more than 35% of the voting power of the
Voting Stock of such parent corporation and the Permitted Holders
"beneficially own" (as defined in clause (i) above), directly or
indirectly, in the aggregate a lesser percentage of the voting power of
the Voting Stock of such parent corporation and do not have the right or
ability by voting power, contract or otherwise to elect or designate for
election a majority of the board of directors of such parent corporation);
(iii) during any period of two consecutive years, individuals who at
the beginning of such period constituted the board of directors of the
Company or Holdings, as the case may be (together with any new directors
whose election by such board of directors of the Company or Holdings, as
the case may be, or whose nomination for election by the shareholders of
the Company or Holdings, as the case may be, was approved by a vote of 66
2/3% of the directors of the Company or Holdings, as the case may be, then
still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the board of directors of
the Company or Holdings, as the case may be, then in office; or
(iv) the merger or consolidation of the Company or Holdings with or
into another Person or the merger of another Person with or into the
Company or Holdings, or the sale of all or substantially all the assets of
the Company or Holdings to another Person (other than a Person that is
controlled by the Permitted Holders), and, in the case of any such merger
or consolidation, the securities of the Company or Holdings that are
outstanding immediately prior to such transaction and which represent 100%
of the aggregate voting power of the Voting Stock of the Company or
Holdings are changed into or exchanged for cash, securities or property,
unless pursuant to such transaction such securities are
5
changed into or exchanged for, in addition to any other consideration,
securities of the surviving Person that represent immediately after such
transaction, at least a majority of the aggregate voting power of the
Voting Stock of the surviving Person; provided, however, that any sale of
accounts receivable in connection with a Qualified Receivables Transaction
shall not constitute a Change of Control.
"Closing Date" means the date of this Indenture.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of
any provision contained herein and required by the TIA, each other obligor on
the indenture securities.
"Consolidated Coverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters for which internal financial statements
are available prior to the date of such determination to (ii) Consolidated
Interest Expense for such four fiscal quarters; provided, however, that (A) if
the Company or any Restricted Subsidiary has Incurred any Indebtedness since the
beginning of such period that remains outstanding on such date of determination
or if the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio is an Incurrence of Indebtedness, EBITDA and Consolidated
Interest Expense for such period shall be calculated after giving effect on a
pro forma basis to such Indebtedness as if such Indebtedness had been Incurred
on the first day of such period and the discharge of any other Indebtedness
repaid, repurchased, defeased or otherwise discharged with the proceeds of such
new Indebtedness as if such discharge had occurred on the first day of such
period (except that, in making such computation, the amount of Indebtedness
under any revolving credit facility outstanding on the date of such calculation
shall be computed based on (1) the average daily balance of such Indebtedness
(and any Indebtedness under a revolving credit facility replaced by such
Indebtedness) during such four fiscal quarters or such shorter period when such
facility and any replaced facility was outstanding or (2) if such facility was
created after the end of such four fiscal quarters, the average daily balance of
such Indebtedness (and any Indebtedness under a revolving credit facility
replaced by such Indebtedness) during the period from the date of creation of
such facility to the date of the calculation), (B) if the Company or any
Restricted Subsidiary has repaid, repurchased, defeased or otherwise discharged
any Indebtedness since the beginning of such period or if any Indebtedness is to
be repaid, repurchased, defeased or otherwise discharged (in each case other
than Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on the date
of the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio, EBITDA and Consolidated Interest Expense for such period shall
be calculated on a pro forma basis as if such discharge had occurred on the
first day of such period and as if the Company or such
Restricted Subsidiary has not earned the interest income actually earned during
such period in respect of cash or Temporary Cash Investments used to repay,
repurchase, defease or otherwise discharge such Indebtedness, (C) if since the
beginning of such period the Company or any Restricted Subsidiary shall have
made any Asset Disposition, the EBITDA for such period shall be reduced by an
amount equal to the EBITDA (if positive) directly attributable to the assets
that are the subject of such Asset Disposition
6
for such period or increased by an amount equal to the EBITDA (if negative)
directly attributable thereto for such period and Consolidated Interest Expense
for such period shall be reduced by an amount equal to the Consolidated Interest
Expense directly attributable to any Indebtedness of the Company or any
Restricted Subsidiary repaid, repurchased, defeased or otherwise discharged with
respect to the Company and its continuing Restricted Subsidiaries in connection
with such Asset Disposition for such period (or, if the Capital Stock of any
Restricted Subsidiary is sold, the Consolidated Interest Expense for such period
directly attributable to the Indebtedness of such Restricted Subsidiary to the
extent the Company and its continuing Restricted Subsidiaries are no longer
liable for such Indebtedness after such sale), (D) if since the beginning of
such period the Company or any Restricted Subsidiary (by merger or otherwise)
shall have made an Investment in any Restricted Subsidiary (or any Person that
becomes a Restricted Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction causing a
calculation to be made hereunder, which constitutes all or substantially all of
an operating unit of a business, EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving pro forma effect thereto (including
the Incurrence of any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period and (E) if since the beginning of such
period any Person (that subsequently became a Restricted Subsidiary or was
merged with or into the Company or any Restricted Subsidiary since the beginning
of such period) shall have made any Asset Disposition or any Investment or
acquisition of assets that would have required an adjustment pursuant to clause
(C) or (D) above if made by the Company or a Restricted Subsidiary during such
period, EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto as if such Asset Disposition,
Investment or acquisition of assets occurred on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be given to an
acquisition of assets, the amount of income or earnings relating thereto and the
amount of Consolidated Interest Expense associated with any Indebtedness
Incurred in connection therewith, the pro forma calculations shall be determined
in good faith by a responsible financial or accounting Officer of the Company,
and such pro forma calculations shall include (A)(x) the savings in cost of
goods sold that would have resulted from using the Company's actual costs for
comparable goods and services during the comparable period and (y) other savings
in cost of goods sold or eliminations of selling, general and administrative
expenses as determined by a responsible financial or accounting Officer of the
Company in good faith in connection with the Company's consideration of such
acquisition and consistent with the Company's experience in acquisitions of
similar assets, less (B) the incremental expenses that would be included in cost
of goods sold and selling, general and administrative expenses that would have
been incurred by the Company in the operation of such acquired assets during
such period. If any Indebtedness bears a floating rate of interest and is being
given pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement applicable to such Indebtedness if such Interest Rate Agreement has a
remaining term as at the date of determination in excess of 12 months).
"Consolidated Interest Expense" means, for any period, the total
interest expense (net of interest income) of the Company and its Consolidated
Restricted Subsidiaries, plus, to the extent Incurred by the Company and its
Restricted Subsidiaries in such period but not included in such interest
expense, (i) interest expense attributable to Capitalized Lease Obligations and
the interest expense attributable to leases
7
constituting part of a Sale/Leaseback Transaction, (ii) amortization of debt
discount, (iii) capitalized interest, (iv) non-cash interest expense, (v)
commissions, discounts and other fees and charges attributable to letters of
credit and bankers' acceptance financing, (vi) interest accruing on any
Indebtedness of any other Person to the extent such Indebtedness is Guaranteed
by the Company or any Restricted Subsidiary, (vii) net costs associated with
Hedging Obligations (including amortization of fees), (viii) dividends in
respect of all Preferred Stock of the Company and any of the Restricted
Subsidiaries of the Company (other than pay in kind dividends and accretions to
liquidation value) to the extent held by Persons other than the Company or a
Wholly Owned Subsidiary, (ix) interest Incurred in connection with investments
in discontinued operations and (x) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest or fees to any Person (other than the
Company) in connection with Indebtedness Incurred by such plan or trust, less,
to the extent included in such total interest expense, the amortization during
such period of capitalized financing costs. Notwithstanding anything to the
contrary contained herein, interest expense, commissions, discounts, yield and
other fees and charges Incurred in connection with any Qualified Receivables
Transaction pursuant to which the Company or any Subsidiary may sell, convey or
otherwise transfer or grant a security interest in any accounts receivable or
related assets of the type specified in the definition of "Qualified Receivables
Transaction" shall not be included in Consolidated Interest Expense; provided
that any interest expense, commissions, discounts, yield and other fees and
charges Incurred in connection with any receivables financing or securitization
that does not constitute a Qualified Receivables Transaction shall be included
in Consolidated Interest Expense.
"Consolidated Net Income" means, for any period, the net income of
the Company and its Consolidated Subsidiaries for such period; provided,
however, that there shall not be included in such Consolidated Net Income:
(i) any net income of any Person (other than the Company) if such
Person is not a Restricted Subsidiary, except that (A) subject to the
limitations contained in clause (iv) below, the Company's equity in the
net income of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a
Restricted Subsidiary as a dividend or other distribution (subject, in the
case of a dividend or other distribution made to a Restricted Subsidiary,
to the limitations contained in clause (iii) below) and (B) the Company's
equity in a net loss of any such Person for such period shall be included
in determining such Consolidated Net Income;
(ii) any net income (or loss) of any Person acquired by the Company
or a Subsidiary in a pooling of interests transaction for any period prior
to the date of such acquisition;
(iii) any net income (or loss) of any Restricted Subsidiary if such
Restricted Subsidiary is subject to restrictions, directly or indirectly,
on the payment of dividends or the making of distributions by such
Restricted Subsidiary, directly or indirectly, to the Company, except that
(A) subject to the limitations contained in clause (iv) below, the
Company's equity in the net income of any such Restricted Subsidiary for
such period shall be included in such Consolidated Net Income up to the
aggregate amount of cash which could
8
have been distributed by such Restricted Subsidiary during such period to
the Company or another Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other distribution
made to another Restricted Subsidiary, to the limitation contained in this
clause) and (B) the Company's equity in a net loss of any such Restricted
Subsidiary for such period shall be included in determining such
Consolidated Net Income;
(iv) any gain (or loss) realized upon the sale or other disposition
of any asset of the Company or its Consolidated Subsidiaries (including
pursuant to any Sale/Leaseback Transaction) that is not sold or otherwise
disposed of in the ordinary course of business and any gain (or loss)
realized upon the sale or other disposition of any Capital Stock of any
Person;
(v) any extraordinary gain or loss;
(vi) the cumulative effect of a change in accounting principles; and
(vii) any expenses or charges paid to third parties related to any
Equity Offering, Permitted Investment, acquisition, recapitalization or
Indebtedness permitted to be Incurred by this Indenture (whether or not
successful) (including such fees, expenses, or charges related to the
Recapitalization).
Notwithstanding the foregoing, for the purposes of Section 4.04 only, there
shall be excluded from Consolidated Net Income any dividends, repayments of
loans or advances or other transfers of assets from Unrestricted Subsidiaries to
the Company or a Restricted Subsidiary to the extent such dividends, repayments
or transfers increase the amount of Restricted Payments permitted under such
Section pursuant to clause (a)(3)(D) thereof.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Company and its Restricted Subsidiaries, determined on a
Consolidated basis, as of the end of the most recent fiscal quarter of the
Company for which internal financial statements are available, as (i) the par or
stated value of all outstanding Capital Stock of the Company plus (ii) paid-in
capital or capital surplus relating to such Capital Stock plus (iii) any
retained earnings or earned surplus less (A) any accumulated deficit and (B) any
amounts attributable to Disqualified Stock.
"Consolidation" means the consolidation of the amounts of each of
the Restricted Subsidiaries with those of the Company in accordance with GAAP
consistently applied; provided, however, that "Consolidation" shall not include
consolidation of the accounts of any Unrestricted Subsidiary, but the interest
of the Company or any Restricted Subsidiary in an Unrestricted Subsidiary shall
be accounted for as an investment. The term "Consolidated" has a correlative
meaning.
"Credit Agreement" means the credit agreement to be dated as of the
Closing Date, as amended, waived or otherwise modified from time to time, among
Holdings, the Company, WESCO Distribution -- Canada, Inc., certain financial
institutions to be party thereto, The Chase Manhattan Bank, as U.S.
administrative agent, syndication agent and U.S. collateral agent, The Chase
Manhattan Bank of Canada, as Canadian administrative agent and Canadian
collateral agent, and Xxxxxx Commercial Paper Inc., as documentation agent.
9
"Credit Facilities" means, with respect to the Company, one or more
debt facilities, or commercial paper facilities with banks or other
institutional lenders or indentures providing for revolving credit loans, term
loans, receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against receivables), letters of credit or other long-term Indebtedness, in each
case, as amended, restated, modified, renewed, refunded, replaced or refinanced
in whole or in part from time to time.
"Currency Agreement" means with respect to any Person any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement to which such Person is a party or of which it is a beneficiary.
"Default" means any event which is, or after notice or passage of
time or both would be, an Event of Default.
"Designated Noncash Consideration" means the fair market value of
noncash consideration received by the Company or any of its Restricted
Subsidiaries in connection with an Asset Disposition that is so designated as
Designated Noncash Consideration pursuant to an Officers' Certificate, setting
forth the basis of such valuation, less the amount of cash or cash equivalents
received in connection with a subsequent sale of such Designated Noncash
Consideration.
"Designated Senior Indebtedness" of the Company means (i) the Bank
Indebtedness and (ii) any other Senior Indebtedness of the Company that, at the
date of determination, has an aggregate principal amount outstanding of, or
under which, at the date of determination, the holders thereof are committed to
lend up to at least $25.0 million and is specifically designated by the Company
in the instrument evidencing or governing such Senior Indebtedness as
"Designated Senior Indebtedness" for purposes of this Indenture. "Designated
Senior Indebtedness" of Holdings has a correlative meaning.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable) or upon the
happening of any event (i) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise, (ii) is convertible or exchangeable for
Indebtedness or Disqualified Stock or (iii) is redeemable at the option of the
holder thereof, in whole or in part, in each case on or prior to the 91st day
following the Stated Maturity of the Senior Subordinated Notes; provided,
however, that any Capital Stock that would not constitute Disqualified Stock but
for provisions thereof giving holders thereof the right to require such Person
to repurchase or redeem such Capital Stock upon the occurrence of an "asset
sale" or "change of control" occurring prior to the first anniversary of the
Stated Maturity of the Securities shall not constitute Disqualified Stock if the
"asset sale" or "change of control" provisions applicable to such Capital Stock
are not more favorable to the holders of such Capital Stock than the provisions
of Sections 4.06 and 4.08.
"EBITDA" for any period means the Consolidated Net Income for such
period, plus the following to the extent deducted in calculating such
Consolidated Net Income: (i) income tax expense of the Company and its
Consolidated Restricted Subsidiaries, (ii) Consolidated Interest Expense, (iii)
depreciation expense of the Company and its Consolidated Restricted
Subsidiaries, (iv) amortization expense of the
10
Company and its Consolidated Restricted Subsidiaries (excluding amortization
expense attributable to a prepaid cash item that was paid in a prior period),
(v) all other non-cash charges of the Company and its Consolidated Restricted
Subsidiaries (excluding any such non-cash charge to the extent it represents an
accrual of or reserve for cash expenditures in any future period) in each case
for such period and (vi) income attributable to discontinued operations.
Notwithstanding the foregoing, the provision for taxes based on the income or
profits of, and the depreciation and amortization and non-cash charges of, a
Restricted Subsidiary of the Company shall be added to Consolidated Net Income
to compute EBITDA only to the extent (and in the same proportion) that the net
income of such Restricted Subsidiary was included in calculating Consolidated
Net Income and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary
without prior approval (that has not been obtained), pursuant to the terms of
its charter and all agreements, instruments, judgments, decrees, orders,
statutes, rules and governmental regulations applicable to such Restricted
Subsidiary or its stockholders.
"Equity Offering" means a private sale or public offering of Capital
Stock (other than Disqualified Stock) of the Company or Holdings.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Excluded Contribution" means the Net Cash Proceeds received by the
Company from (a) contributions to its common equity capital and (b) the sale
(other than to a Subsidiary or to any Company or Subsidiary management equity
plan or stock option plan or any other management or employee benefit plan or
agreement) of Capital Stock (other than Disqualified Stock) of the Company, in
each case designated as Excluded Contributions pursuant to an Officers'
Certificate executed by the principal executive officer and the principal
financial officer of the Company on the date such capital contributions are made
or the date such Capital Stock is sold.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Closing Date, including those set forth
in (i) the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (ii) statements and
pronouncements of the Financial Accounting Standards Board, (iii) such other
statements by such other entity as approved by a significant segment of the
accounting profession and (iv) the rules and regulations of the SEC governing
the inclusion of financial statements (including pro forma financial statements)
in periodic reports required to be filed pursuant to Section 13 of the Exchange
Act, including opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the SEC. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any other Person
and any obligation, direct or indirect, contingent or otherwise, of such Person
(i) to purchase or pay (or advance or supply funds for the purchase or payment
of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreement to keep-well, to purchase assets,
goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such Indebtedness of the
11
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided, however, that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning. The
term "Guarantor" shall mean any Person Guaranteeing any obligation.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holdings Guarantee" means the Guarantee of the obligations with
respect to the Senior Subordinated Notes issued by Holdings pursuant to the
terms of this Indenture.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Person at the time it becomes a Subsidiary. The term "Incurrence" when used as a
noun shall have a correlative meaning. The accretion of principal of a
non-interest bearing or other discount security shall not be deemed the
Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication),
(i) the principal of and premium (if any) in respect of indebtedness
of such Person for borrowed money;
(ii) the principal of and premium (if any) in respect of obligations
of such Person evidenced by bonds, debentures, notes or other similar
instruments;
(iii) all obligations of such Person in respect of letters of credit
or other similar instruments (including reimbursement obligations with
respect thereto) (other than obligations with respect to letters of credit
securing obligations (other than obligations described in clauses (i),
(ii), (iv) and (v) hereof) to the extent such letters of credit are not
drawn upon or, if and to the extent drawn upon, such drawing is reimbursed
no later than the 30th day following payment on the letter of credit so
long as such letter of credit is entered into in the ordinary course of
business);
(iv) all obligations of such Person to pay the deferred and unpaid
purchase price of property or services (except Trade Payables), which
purchase price is due more than six months after the date of placing such
property in service or taking delivery and title thereto or the completion
of such services;
(v) all Capitalized Lease Obligations and all Attributable Debt of
such Person;
(vi) the amount of all obligations of such Person with respect to
the redemption, repayment or other repurchase of any Disqualified Stock
or, with respect to any Subsidiary of such Person, any Preferred Stock
(but excluding, in each case, any accrued dividends);
12
(vii) all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such
Person; provided, however, that the amount of Indebtedness of such Person
shall be the lesser of (A) the fair market value of such asset at such
date of determination and (B) the amount of such Indebtedness of such
other Persons;
(viii) to the extent not otherwise included in this definition,
Hedging Obligations of such Person; and
(ix) all obligations of the type referred to in clauses (i) through
(viii) of other Persons and all dividends of other Persons for the payment
of which, in either case, such Person is responsible or liable, directly
or indirectly, as obligor, guarantor or otherwise, including by means of
any Guarantee.
The amount of Indebtedness of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations as described above and the
maximum liability, upon the occurrence of the contingency giving rise to the
obligation, of any contingent obligations at such date; provided, however, that
the amount outstanding at any time of any Indebtedness Incurred with original
issue discount is the face amount of such Indebtedness less the remaining
unamortized portion of the original issue discount of such Indebtedness at such
time as determined in conformity with GAAP. Any "Qualified Receivables
Transaction", whether or not such transfer constitutes a sale for the purposes
of GAAP, shall not constitute Indebtedness hereunder; provided that any
receivables financing or securitization that does not constitute a Qualified
Receivables Transaction and does not qualify as a sale under GAAP shall
constitute Indebtedness hereunder.
"Indenture" means this Indenture as amended or supplemented from
time to time.
"Independent Financial Advisor" means an accounting, appraisal,
investment banking firm or consultant of nationally recognized standing that is,
in the good faith determination of the Company, qualified to perform the task
for which it has been engaged.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.
"Investment" in any Person means any direct or indirect advance,
loan (other than advances to customers in the ordinary course of business that
are recorded as accounts receivable on the balance sheet of the lender) or other
extension of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary" and Section 4.04, (i) "Investment" shall include the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of any Subsidiary of the Company at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a
13
redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall
be deemed to continue to have a permanent "Investment" in an Unrestricted
Subsidiary in an amount (if positive) equal to (x) the Company's "Investment" in
such Subsidiary at the time of such redesignation less (y) the portion
(proportionate to the Company's equity interest in such Subsidiary) of the fair
market value of the net assets of such Subsidiary at the time of such
redesignation; and (ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of Directors.
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"Net Available Cash" from an Asset Disposition means cash payments
received (including (a) any cash payments received upon the sale or other
disposition of any Designated Noncash Consideration received in any Asset
Disposition, (b) any cash proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise and (c) any
cash proceeds from the sale or other disposition of any securities received as
consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of
Indebtedness or other obligations relating to the properties or assets that are
the subject of such Asset Disposition or received in any other non-cash form)
therefrom, in each case net of (i) all legal, title and recording tax expenses,
commissions and other fees and expenses incurred (including, without limitation,
all broker's and finder's fees and expenses, all investment banking fees and
expenses, employee severance and termination costs, and trade payable and
similar liabilities solely related to the assets sold or otherwise disposed of
and required to be paid by the seller as a result thereof), and all Federal,
state, provincial, foreign and local taxes required to be paid or accrued as a
liability under GAAP, as a consequence of such Asset Disposition, (ii) all
relocation expenses incurred as a result thereof, (iii) all payments made on any
Indebtedness which is secured by any assets subject to such Asset Disposition,
in accordance with the terms of any Lien upon or other security agreement of any
kind with respect to such assets, or which must by its terms, or in order to
obtain a necessary consent to such Asset Disposition, or by applicable law be
repaid out of the proceeds from such Asset Disposition, (iv) all distributions
and other payments required to be made to minority interest holders in
Subsidiaries or joint ventures as a result of such Asset Disposition and (v)
appropriate amounts to be provided by the seller as a reserve, in accordance
with GAAP, against any liabilities associated with the property or other assets
disposed of in such Asset Disposition and retained by the Company or any
Restricted Subsidiary after such Asset Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the Chief Financial Officer, the President, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of
the Company.
14
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel who
is acceptable to the Senior Subordinated Notes Trustee. The counsel may be an
employee of or counsel to the Company or the Senior Subordinated Notes Trustee.
"Permitted Holders" means (i) The Cypress Group L.L.C., Cypress
Merchant Banking Partners L.P., Cypress Offshore Partners L.P., Chase Equity
Associates, L.P., Co-Investment Partners, L.P. and any Person who on the Senior
Subordinated Notes Issue Date is an Affiliate of any of the foregoing; (ii) any
Person who is a member of the senior management of the Company or Holdings and a
stockholder of Holdings on the Senior Subordinated Notes Issue Date; and (iii)
any Person acting in the capacity of an underwriter in connection with a public
or private offering of the Company's or Holdings' Capital Stock.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (i) the Company, a Restricted Subsidiary or a Person
that will, upon the making of such Investment, become a Restricted Subsidiary;
(ii) another Person if as a result of such Investment such other Person is
merged or consolidated with or into, or transfers or conveys all or
substantially all its assets to, the Company or a Restricted Subsidiary; (iii)
Temporary Cash Investments; (iv) receivables owing to the Company or any
Restricted Subsidiary if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms; provided,
however, that such trade terms may include such concessionary trade terms as the
Company or any such Restricted Subsidiary deems reasonable under the
circumstances; (v) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as expenses
for accounting purposes and that are made in the ordinary course of business;
(vi) loans or advances to employees made in the ordinary course of business
consistent with past practices of the Company or such Restricted Subsidiary and
not exceeding $5.0 million in the aggregate outstanding at any one time; (vii)
stock, obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments; (viii) any Person to the extent such
Investment represents the non-cash portion of the consideration received for an
Asset Disposition that was made pursuant to and in compliance with Section 4.06;
(ix) Investments made in connection with any Asset Disposition or other sale,
lease, transfer or other disposition permitted under this Indenture; (x) a
Receivables Entity or any Investment by a Receivables Entity in any other Person
in connection with a Qualified Receivables Transaction, including Investments of
funds held in accounts permitted or required by the arrangements governing such
Qualified Receivables Transaction or any related Indebtedness; provided that any
Investment in a Receivables Entity is in the form of a Purchase Money Note,
contribution of additional receivables or an equity interest; (xi) Investments
in a Related Business having an aggregate fair market value, taken together with
all other Investments made pursuant to this clause (xi) that are at that time
outstanding (and not including any Investments outstanding on the Closing Date),
not to exceed 5% of Adjusted Consolidated Assets at the time of such Investments
(with the fair market value of each Investment being measured at the time made
and without giving effect to subsequent changes in value); and (xii) additional
Investments in an aggregate amount which, together with all other Investments
made pursuant to this clause that are then outstanding, does not exceed $10.0
million.
15
"Permitted Liens" means (a) Liens of the Company and its Restricted
Subsidiaries securing Indebtedness of the Company or any of its Restricted
Subsidiaries Incurred under the Credit Agreement or other Credit Facilities to
the extent permitted to be Incurred under Section 4.03(b)(i) and (xiii); (b)
Liens in favor of the Company or its Wholly Owned Restricted Subsidiaries; (c)
Liens on property of a Person existing at the time such Person becomes a
Restricted Subsidiary of the Company or is merged into or consolidated with the
Company or any Restricted Subsidiary of the Company; provided that such Liens
were not Incurred in connection with, or in contemplation of, such merger or
consolidation and such Liens do not extend to or cover any property other than
such property, improvements thereon and any proceeds therefrom; (d) Liens of the
Company securing Indebtedness of the Company Incurred under Section 4.03(b)(v);
(e) Liens of the Company and its Restricted Subsidiaries securing Indebtedness
of the Company or any of its Restricted Subsidiaries (including under a
Sale/Leaseback Transaction) permitted to be Incurred under Section 4.03(b)(vi),
(vii) and (viii) so long as the Capital Stock, property (real or personal) or
equipment to which such Lien attaches solely consists of the Capital Stock,
property or equipment which is the subject of such acquisition, purchase, lease,
improvement, Sale/Leaseback Transaction and additions and improvements thereto
(and the proceeds therefrom); (f) Liens on property existing at the time of
acquisition thereof by the Company or any Restricted Subsidiary of the Company;
provided that such Liens were not Incurred in connection with, or in
contemplation of, such acquisition and such Liens do not extend to or cover any
property other than such property, additions and improvements thereon and any
proceeds therefrom; (g) Liens Incurred or deposits made to secure the
performance of tenders, bids, leases, statutory obligations, surety or appeal
bonds, government contracts, performance and return of money bonds or other
obligations of a like nature Incurred in the ordinary course of business; (h)
Liens existing on the Senior Subordinated Notes Issue Date and any additional
Liens created under the terms of the agreements relating to such Liens existing
on the Senior Subordinated Notes Issue Date; (i) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings; provided that any reserve or
other appropriate provision as shall be required in conformity with GAAP shall
have been made therefor; (j) Liens Incurred in the ordinary course of business
of the Company or any Restricted Subsidiary with respect to obligations that do
not exceed $20.0 million in the aggregate at any one time outstanding and that
(1) are not Incurred in connection with or in contemplation of the borrowing of
money or the obtaining of advances or credit (other than trade credit in the
ordinary course of business) and (2) do not in the aggregate materially detract
from the value of the property or materially impair the use thereof in the
operation of the business by the Company or such Restricted Subsidiary; (k)
statutory Liens of landlords and warehousemen's, carrier's, mechanics',
suppliers', materialmen's, repairmen's or other like Liens (including
contractual landlords' liens) arising in the ordinary course of business of the
Company and its Restricted Subsidiaries; (l) Liens Incurred or deposits made in
the ordinary course of business of the Company and its Restricted Subsidiaries
in connection with workers' compensation, unemployment insurance and other types
of social security; (m) easements, rights of way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the business of the Company or any of
its Restricted Subsidiaries; (n) Liens securing reimbursement obligations with
respect to letters of credit permitted under Section 4.03 which encumber only
cash and marketable securities and documents and other property relating to such
letters of credit and the products and proceeds thereof; (o) judgment and
attachment Liens not giving rise to an Event of Default; (p) any interest or
title of a lessor in the property subject to any
16
Capitalized Lease Obligation permitted under Section 4.03; (q) Liens on accounts
receivable and related assets of the type specified in the definition of
"Qualified Receivables Transaction" Incurred in connection with a Qualified
Receivables Transaction; (r) Liens securing Refinancing Indebtedness to the
extent such Liens do not extend to or cover any property of the Company not
previously subjected to Liens relating to the Indebtedness being refinanced; or
(s) Liens on pledges of the capital stock of any Unrestricted Subsidiary
securing any Indebtedness of such Unrestricted Subsidiary.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) that is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.
"principal" of a Senior Subordinated Note means the principal of the
Senior Subordinated Note plus the premium, if any, payable on the Senior
Subordinated Note that is due or overdue or is to become due at the relevant
time.
"Purchase Money Note" means a promissory note of a Receivables
Entity evidencing a line of credit, which may be irrevocable, from the Company
or any Subsidiary of the Company in connection with a Qualified Receivables
Transaction to a Receivables Entity, which note (a) shall be repaid from cash
available to the Receivables Entity, other than (i) amounts required to be
established as reserves pursuant to agreements, (ii) amounts paid to investors
in respect of interest, (iii) principal and other amounts owing to such
investors and amounts owing to such investors, (iv) amounts required to pay
expenses in connection with such Qualified Receivables Transaction and (v)
amounts paid in connection with the purchase of newly generated receivables and
(b) may be subordinated to the payments described in (a).
"Qualified Receivables Transaction" means any financing by the
Company or any of its Subsidiaries of accounts receivable in any transaction or
series of transactions that may be entered into by the Company or any of its
Subsidiaries pursuant to which (a) the Company or any of its Subsidiaries sells,
conveys or otherwise transfers to a Receivables Entity and (b) a Receivables
Entity sells, conveys or otherwise transfers to any other Person or grants a
security interest to any Person in, any accounts receivable (whether now
existing or arising in the future) of the Company or any of its Subsidiaries,
and any assets related thereto including, without limitation, all collateral
securing such accounts receivable, all contracts and all Guarantees or other
obligations in respect of such accounts receivable, proceeds of such accounts
receivable and other assets which are customarily transferred or in respect of
which security interests are customarily granted in connection with asset
securitization transactions involving accounts receivable; provided that (i) the
Board of Directors shall have determined in good faith that such Qualified
Receivables Transaction is economically fair and reasonable to the Company and
the Receivables Entity and (ii) all sales of accounts receivable and related
assets to the Receivables Entity are made at fair market value (as determined in
good
17
faith by the Company). The grant of a security interest in any accounts
receivable of the Company or any of its Restricted Subsidiaries to secure Bank
Indebtedness shall not be deemed a Qualified Receivables Transaction.
"Receivables Entity" means any Wholly Owned Subsidiary of the
Company (or another Person in which the Company or any Subsidiary of the Company
makes an Investment and to which the Company or any Subsidiary of the Company
transfers accounts receivable and related assets) (i) which engages in no
activities other than in connection with the financing of accounts receivable,
all proceeds thereof and all rights (contractual or other), collateral and other
assets relating thereto, and any business or activities incidental or related to
such business, (ii) which is designated by the Board of Directors (as provided
below) as a Receivables Entity and (iii) no portion of the Indebtedness or any
other obligations (contingent or otherwise) of which (A) is Guaranteed by the
Company or any other Subsidiary of the Company (excluding Guarantees of
obligations (other than the principal of, and interest on, Indebtedness)
pursuant to Standard Securitization Undertakings), (B) is recourse to or
obligates the Company or any other Subsidiary of the Company in any way other
than pursuant to Standard Securitization Undertakings or (C) subjects any
property or asset of the Company or any other Subsidiary of the Company,
directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than pursuant to Standard Securitization Undertakings. Any such
designation by the Board of Directors shall be evidenced to the Senior
Subordinated Notes Trustee by filing with the Senior Subordinated Notes Trustee
a certified copy of the resolution of the Board of Directors giving effect to
such designation and an Officers' Certificate certifying that such designation
complied with the foregoing conditions.
"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refund, refinance, replace, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) any Indebtedness of the Company or any
Restricted Subsidiary existing on the date of this Indenture or Incurred in
compliance with this Indenture (including Indebtedness of the Company that
Refinances Refinancing Indebtedness); provided, however, that (i) the
Refinancing Indebtedness has a Stated Maturity no earlier than the Stated
Maturity of the Indebtedness being Refinanced, (ii) the Refinancing Indebtedness
has an Average Life at the time such Refinancing Indebtedness is Incurred that
is equal to or greater than the Average Life of the Indebtedness being
refinanced and (iii) such Refinancing Indebtedness is Incurred in an aggregate
principal amount (or if issued with original issue discount, an aggregate issue
price) that is equal to or less than the aggregate principal amount (or if
issued with original issue discount, the aggregate accreted value) then
outstanding of the Indebtedness being Refinanced (plus any accrued interest and
premium thereon and reasonable expenses Incurred in connection therewith);
provided further, however, that Refinancing Indebtedness shall not include (x)
Indebtedness of a Restricted Subsidiary that Refinances Indebtedness of the
Company or (y) Indebtedness of the Company or a Restricted Subsidiary that
Refinances Indebtedness of an Unrestricted Subsidiary.
18
"Related Business" means any businesses of the Company and the
Restricted Subsidiaries on the Closing Date and any business related, ancillary
or complementary thereto.
"Representative" means the trustee, agent or representative (if any)
for an issue of Senior Indebtedness of the Company.
"Restricted Subsidiary" means any Subsidiary of the Company other
than an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired by the Company or a Restricted
Subsidiary whereby the Company or a Restricted Subsidiary transfers such
property to a Person and the Company or such Restricted Subsidiary leases it
from such Person, other than leases between the Company and a Wholly Owned
Subsidiary or between Wholly Owned Subsidiaries.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company secured
by a Lien. "Secured Indebtedness" of Holdings has a correlative meaning.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Discount Notes" means the 111/8% senior discount notes due
2008 issued by Holdings under the indenture dated as of the Closing Date between
Holdings and Bank One, N.A., as trustee.
"Senior Indebtedness" of the Company means the principal of, premium
(if any) and accrued and unpaid interest on (including interest accruing on or
after the filing of any petition in bankruptcy or for reorganization of the
Company, regardless of whether or not a claim for post-filing interest is
allowed in such proceedings), and fees and all other amounts owing in respect
of, Bank Indebtedness and all other Indebtedness of the Company, whether
outstanding on the Closing Date or thereafter Incurred, unless in the instrument
creating or evidencing the same or pursuant to which the same is outstanding it
is provided that such obligations are not superior in right of payment to the
Senior Subordinated Notes; provided, however, that Senior Indebtedness shall not
include (i) any obligation of the Company to any Subsidiary, (ii) any liability
for Federal, state, local or other taxes owed or owing by the Company, (iii) any
accounts payable or other liability to trade creditors arising in the ordinary
course of business (including Guarantees thereof or instruments evidencing such
liabilities), (iv) any Indebtedness or obligation of the Company (and any
accrued and unpaid interest in respect thereof) that by its terms is subordinate
or junior in any respect to any other Indebtedness or obligation of the Company,
including any Senior Subordinated Indebtedness of the Company and any
Subordinated Obligations of the Company, (v) any payment obligations with
respect to any Capital Stock or (vi) any Indebtedness Incurred in violation of
this Indenture. "Senior Indebtedness" of Holdings has a correlative meaning.
"Senior Subordinated Indebtedness" of the Company means the Senior
Subordinated Notes and any other Indebtedness of the Company that specifically
provides that such Indebtedness is to rank pari passu with the Senior
Subordinated Notes in right of payment and is not subordinated by its terms in
right of payment to any
19
Indebtedness or other obligation of the Company which is not Senior
Indebtedness. "Senior Subordinated Indebtedness" of Holdings has a correlative
meaning.
"Senior Subordinated Noteholder" or "Holder" means the Person in
whose name a Senior Subordinated Note is registered on the Registrar's books.
"Senior Subordinated Notes" means the Senior Subordinated Notes
issued under this Indenture.
"Senior Subordinated Notes Issue Date", with respect to any Initial
Senior Subordinated Notes, means the date on which the Initial Senior
Subordinated Notes are originally issued.
"Senior Subordinated Notes Trustee" means the party named as such in
this Indenture until a successor replaces it and, thereafter, means the
successor.
"Significant Subsidiary" means any Restricted Subsidiary that would
be a "Significant Subsidiary" of the Company within the meaning of Rule 1-02
under Regulation S-X promulgated by the SEC, but shall in no event include a
Receivables Entity.
"Standard Securitization Undertakings" means representations,
warranties, covenants and indemnities entered into by the Company or any
Subsidiary of the Company which the Company has determined in good faith to be
customary in an accounts receivable transaction including, without limitation,
those relating to the servicing of the assets of a Receivables Entity.
"Stated Maturity" means, with respect to any security, the date
specified in such security as the fixed date on which the final payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency beyond the control of the issuer unless such
contingency has occurred).
"Subordinated Obligation" means any Indebtedness of the Company
(whether outstanding on the Closing Date or thereafter Incurred) that is
subordinate or junior in right of payment to the Senior Subordinated Notes
pursuant to a written agreement. "Subordinated Obligation" of Holdings has a
correlative meaning.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by (i) such Person, (ii) such
Person and one or more Subsidiaries of such Person or (iii) one or more
Subsidiaries of such Person.
"Temporary Cash Investments" means any of the following: (i) any
investment in direct obligations of the United States of America or any agency
thereof or obligations Guaranteed by the United States of America or any agency
thereof, (ii) investments in time deposit accounts, certificates of deposit and
money market
20
deposits maturing within one year of the date of acquisition thereof issued by a
bank or trust company that is organized under the laws of the United States of
America, any state thereof or any foreign country recognized by the United
States of America having capital, surplus and undivided profits aggregating in
excess of $100,000,000 (or the foreign currency equivalent thereof) and whose
long-term debt is rated "A" (or such similar equivalent rating) or higher by at
least one nationally recognized statistical rating organization (as defined in
Rule 436 under the Securities Act) or any money market fund sponsored by a
registered broker-dealer or mutual fund distributor, (iii) repurchase
obligations with a term of not more than 30 days for underlying securities of
the types described in clause (i) above entered into with a financial
institution meeting the qualifications described in clause (ii) above, (iv)
investments in commercial paper, maturing not more than one year after the date
of acquisition, issued by a corporation (other than an Affiliate of the Company)
organized and in existence under the laws of the United States of America or any
foreign country recognized by the United States of America with a rating at the
time as of which any investment therein is made of "P-1" (or higher) according
to Xxxxx'x Investors Service, Inc. or "A-1" (or higher) according to Standard
and Poor's Ratings Service, a division of The XxXxxx-Xxxx Companies, Inc.
("S&P"), and (v) investments in securities with maturities of one year or less
from the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States of America, or by any political
subdivision or taxing authority thereof, and rated at least "A" by S&P or "A" by
Xxxxx'x Investors Service, Inc.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. xx.xx. 77aaa-
77bbbb), as amended, as in effect on the date of this Indenture.
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.
"Treasury Rate" means the yield to maturity at the time of
computation of United States Treasury securities with a constant maturity (as
compiled by, and published in, the most recent Federal Reserve Statistical
Release H.15 (519) which has become publicly available at least two Business
Days prior to the date fixed for redemption of the Senior Subordinated Notes
following a Change of Control (or, if such Statistical Release is no longer
published, any publicly available source of similar market data)) most nearly
equal to the period from the redemption date to June 1, 2003; provided, however,
that if the period from the redemption date to June 1, 2003 is not equal to the
constant maturity of a United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the weekly
average yields of United States Treasury securities for which such yields are
given, except that if the period from the redemption date to June 1, 2003 is
less than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year shall be used.
"Trust Officer" means the Chairman of the Board, the President or
any other officer or assistant officer of the Senior Subordinated Notes Trustee
assigned by the Senior Subordinated Notes Trustee to administer its corporate
trust matters.
"Uniform Commercial Code" means the New York Uniform Commercial Code
as in effect from time to time.
21
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
that at the time of determination shall be designated an Unrestricted Subsidiary
by the Board of Directors in the manner provided below and (ii) any Subsidiary
of an Unrestricted Subsidiary. The Board of Directors may designate any
Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of,
or owns or holds any Lien on any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated; provided, however, that either (A) the Subsidiary to be so
designated has total Consolidated assets of $1,000 or less or (B) if such
Subsidiary has Consolidated assets greater than $1,000, then such designation
would be permitted under Section 4.04. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that
immediately after giving effect to such designation (x) the Company could Incur
$1.00 of additional Indebtedness under Section 4.03(a) and (y) no Default shall
have occurred and be continuing. Any such designation of a Subsidiary as a
Restricted Subsidiary or Unrestricted Subsidiary by the Board of Directors shall
be evidenced to the Senior Subordinated Notes Trustee by promptly filing with
the Senior Subordinated Notes Trustee a copy of the resolution of the Board of
Directors giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Voting Stock" of a Person means all classes of Capital Stock or
other interests (including partnership interests) of such Person then
outstanding and normally entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the
Company all the Capital Stock of which (other than directors' qualifying shares)
is owned by the Company or another Wholly Owned Subsidiary.
SECTION 1.02. Other Definitions.
Defined in
Term Section
---- -------
"Affiliate Transaction"................................ 4.07
"Bankruptcy Law"....................................... 6.01
"Blockage Notice"...................................... 10.03
"Change of Control Offer".............................. 4.08(b)
"covenant defeasance option"........................... 8.01(b)
"Custodian"............................................ 6.01
"Event of Default"..................................... 6.01
"Guaranteed Obligations"............................... 11.01
"legal defeasance option".............................. 8.01(b)
"Legal Holiday"........................................ 13.08
22
"Offer"................................................ 4.06(b)
"Offer Amount"......................................... 4.06(c)(2)
"Offer Period"......................................... 4.06(c)(2)
"pay its Holdings Guarantee"........................... 12.03
"pay the Senior Subordinated Notes".................... 10.03
"Paying Agent"......................................... 2.04
"Payment Blockage Period".............................. 10.03
"protected purchaser".................................. 2.08
"Purchase Date"........................................ 4.06(c)(1)
"Registrar"............................................ 2.04
"Restricted Payment"................................... 4.04(b)
"Successor Company".................................... 5.01
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.
This Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Senior Subordinated Notes and the
Holdings Guarantee.
"indenture security holder" means a Senior Subordinated Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Senior
Subordinated Notes Trustee.
"obligor" on the indenture securities means the Company, Holdings
and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.04. Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
23
(5) words in the singular include the plural and words in the plural
include the singular;
(6) unsecured Indebtedness shall not be deemed to be subordinate or
junior to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(7) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof that
would be shown on a balance sheet of the issuer dated such date prepared
in accordance with GAAP; and
(8) the principal amount of any Preferred Stock shall be (i) the
maximum liquidation value of such Preferred Stock or (ii) the maximum
mandatory redemption or mandatory repurchase price with respect to such
Preferred Stock, whichever is greater.
ARTICLE 2
The Senior Subordinated Notes
SECTION 2.01. Amount of Senior Subordinated Notes; Issuable in
Series. The aggregate principal amount of Senior Subordinated Notes which may be
authenticated and delivered under this Indenture is $500 million. The Senior
Subordinated Notes may be issued in one or more series. All Senior Subordinated
Notes of any one series shall be substantially identical except as to
denomination.
With respect to any Additional Senior Subordinated Notes issued
after the Closing Date (except for Senior Subordinated Notes authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of,
other Senior Subordinated Notes pursuant to Section 2.07, 2.08, 2.09, 2.10 or
3.06 or the Appendix), there shall be (i) established in or pursuant to a
resolution of the Board of Directors and (ii) (A) set forth or determined in the
manner provided in an Officers' Certificate or (B) established in one or more
indentures supplemental hereto, prior to the issuance of such Additional Senior
Subordinated Notes:
(1) whether such Additional Senior Subordinated Notes shall be
issued as part of a new or existing series of Senior Subordinated Notes
and the title of such Additional Senior Subordinated Notes (which shall
distinguish the Additional Senior Subordinated Notes of the series from
Senior Subordinated Notes of any other series);
(2) the aggregate principal amount of such Additional Senior
Subordinated Notes which may be authenticated and delivered under this
Indenture, which shall be in an aggregate principal amount not to exceed
$200 million (except for Senior Subordinated Notes authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu
of, other Senior Subordinated Notes of the same series pursuant to Section
2.07, 2.08, 2.09, 2.10 or 3.06 or the Appendix and except for Senior
Subordinated Notes which,
24
pursuant to Section 2.03, are deemed never to have been authenticated and
delivered hereunder);
(3) the issue price and issuance date of such Additional Senior
Subordinated Notes, including the date from which interest on such
Additional Senior Subordinated Notes shall accrue; provided; however, that
no Additional Senior Subordinated Notes may be issued at a price that
would cause such Additional Senior Subordinated Notes to have "original
issue discount" within the meaning of Section 1273 of the Code;
(4) if applicable, that such Additional Senior Subordinated Notes
shall be issuable in whole or in part in the form of one or more Global
Senior Subordinated Notes (as defined in the Appendix) and, in such case,
the respective depositaries for such Global Senior Subordinated Notes, the
form of any legend or legends which shall be borne by such Global Senior
Subordinated Notes in addition to or in lieu of those set forth in Exhibit
A hereto and any circumstances in addition to or in lieu of those set
forth in Section 2.3 of the Appendix in which any such Global Senior
Subordinated Note may be exchanged in whole or in part for Additional
Senior Subordinated Notes registered, or any transfer of such Global
Senior Subordinated Note in whole or in part may be registered, in the
name or names of Persons other than the depositary for such Global Senior
Subordinated Note or a nominee thereof; and
(5) if applicable, that such Additional Senior Subordinated Notes
shall not be issued in the form of Initial Senior Subordinated Notes as
set forth in Exhibit A, but shall be issued in the form of Senior
Subordinated Exchange Notes as set forth in Exhibit B.
If any of the terms of any Additional Senior Subordinated Notes are
established by action taken pursuant to a resolution of the Board of Directors,
a copy of an appropriate record of such action shall be certified by the
Secretary or any Assistant Secretary of the Company and delivered to the Senior
Subordinated Notes Trustee at or prior to the delivery of the Officers'
Certificate or the indenture supplemental hereto setting forth the terms of the
Additional Senior Subordinated Notes.
SECTION 2.02. Form and Dating. Provisions relating to the Original
Senior Subordinated Notes, the Additional Senior Subordinated Notes, the Private
Senior Subordinated Exchange Notes and the Senior Subordinated Exchange Notes
are set forth in the Appendix, which is hereby incorporated in and expressly
made a part of this Indenture. The (i) Original Senior Subordinated Notes and
the Senior Subordinated Notes Trustee's certificate of authentication, (ii)
Private Senior Subordinated Exchange Notes and the Senior Subordinated Notes
Trustee's certificate of authentication and (iii) any Additional Senior
Subordinated Notes (if issued as Transfer Restricted Senior Subordinated Notes
(as defined in the Appendix)) and the Senior Subordinated Notes Trustee's
certificate of authentication shall each be substantially in the form of Exhibit
A hereto, which is hereby incorporated in and expressly made a part of this
Indenture. The Senior Subordinated Exchange Notes and any Additional Senior
Subordinated Notes issued other than as Transfer Restricted Senior Subordinated
Notes and the Senior Subordinated Notes Trustee's certificate of authentication
shall each be substantially in the form of Exhibit B hereto, which is hereby
incorporated in and expressly made a part of this Indenture. The Senior
Subordinated Notes may have notations, legends or
25
endorsements required by law, stock exchange rule, agreements to which the
Company or Holdings is subject, if any, or usage (provided that any such
notation, legend or endorsement is in a form acceptable to the Company). Each
Senior Subordinated Note shall be dated the date of its authentication. The
Senior Subordinated Notes shall be issued only in registered form without
coupons and only in denominations of $1,000 and integral multiples thereof.
SECTION 2.03. Execution and Authentication. One or more Officers
shall sign the Senior Subordinated Notes for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Senior Subordinated Note no
longer holds that office at the time the Senior Subordinated Notes Trustee
authenticates the Senior Subordinated Note, the Senior Subordinated Note shall
be valid nevertheless.
A Senior Subordinated Note shall not be valid until an authorized
signatory of the Senior Subordinated Notes Trustee manually signs the
certificate of authentication on the Senior Subordinated Note. The signature
shall be conclusive evidence that the Senior Subordinated Note has been
authenticated under this Indenture.
The Senior Subordinated Notes Trustee shall authenticate and make
available for delivery Senior Subordinated Notes as set forth in the Appendix.
The Senior Subordinated Notes Trustee may appoint an authenticating
agent reasonably acceptable to the Company to authenticate the Senior
Subordinated Notes. Any such appointment shall be evidenced by an instrument
signed by a Trust Officer, a copy of which shall be furnished to the Company.
Unless limited by the terms of such appointment, an authenticating agent may
authenticate Senior Subordinated Notes whenever the Senior Subordinated Notes
Trustee may do so. Each reference in this Indenture to authentication by the
Senior Subordinated Notes Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Registrar, Paying Agent or agent
for service of notices and demands.
SECTION 2.04. Registrar and Paying Agent. The Company shall maintain
an office or agency where Senior Subordinated Notes may be presented for
registration of transfer or for exchange (the "Registrar") and an office or
agency where Senior Subordinated Notes may be presented for payment (the "Paying
Agent"). The Registrar shall keep a register of the Senior Subordinated Notes
and of their transfer and exchange. The Company may have one or more
co-registrars and one or more additional paying agents. The term "Paying Agent"
includes any additional paying agent, and the term "Registrar" includes any
co-registrars. The Company initially appoints the Senior Subordinated Notes
Trustee as (i) Registrar and Paying Agent in connection with the Senior
Subordinated Notes and (ii) the Senior Subordinated Notes Custodian (as defined
in the Appendix) with respect to the Global Senior Subordinated Notes.
The Company shall enter into an appropriate agency agreement with
any Registrar or Paying Agent not a party to this Indenture, which shall
incorporate the terms of the TIA. The agreement shall implement the provisions
of this Indenture that relate to such agent. The Company shall notify the Senior
Subordinated Notes Trustee of the name and address of any such agent. If the
Company fails to maintain a Registrar or Paying Agent, the Senior Subordinated
Notes Trustee shall act as such and shall be
26
entitled to appropriate compensation therefor pursuant to Section 7.07. The
Company or any of its domestically organized Wholly Owned Subsidiaries may act
as Paying Agent or Registrar.
The Company may remove any Registrar or Paying Agent upon written
notice to such Registrar or Paying Agent and to the Senior Subordinated Notes
Trustee; provided, however, that no such removal shall become effective until
(1) acceptance of an appointment by a successor as evidenced by an appropriate
agreement entered into by the Company and such successor Registrar or Paying
Agent, as the case may be, and delivered to the Senior Subordinated Notes
Trustee or (2) notification to the Senior Subordinated Notes Trustee that the
Senior Subordinated Notes Trustee shall serve as Registrar or Paying Agent until
the appointment of a successor in accordance with clause (1) above. The
Registrar or Paying Agent may resign at any time upon written notice; provided,
however, that the Senior Subordinated Notes Trustee may resign as Paying Agent
or Registrar only if the Senior Subordinated Notes Trustee also resigns as
Senior Subordinated Notes Trustee in accordance with Section 7.08.
SECTION 2.05. Paying Agent To Hold Money in Trust. Prior to each due
date of the principal and interest on any Senior Subordinated Note, the Company
shall deposit with the Paying Agent (or if the Company or a Subsidiary is acting
as Paying Agent, segregate and hold in trust for the benefit of the Persons
entitled thereto) a sum sufficient to pay such principal and interest when so
becoming due. The Company shall require each Paying Agent (other than the Senior
Subordinated Notes Trustee) to agree in writing that the Paying Agent shall hold
in trust for the benefit of Senior Subordinated Noteholders or the Senior
Subordinated Notes Trustee all money held by the Paying Agent for the payment of
principal of or interest on the Senior Subordinated Notes and shall notify the
Senior Subordinated Notes Trustee of any default by the Company in making any
such payment. If the Company or a Subsidiary of the Company acts as Paying
Agent, it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Senior Subordinated Notes Trustee and to account for
any funds disbursed by the Paying Agent. Upon complying with this Section, the
Paying Agent shall have no further liability for the money delivered to the
Senior Subordinated Notes Trustee.
SECTION 2.06. Senior Subordinated Noteholder Lists. The Senior
Subordinated Notes Trustee shall preserve in as current a form as is reasonably
prac ticable the most recent list available to it of the names and addresses of
Senior Subordinated Noteholders. If the Senior Subordinated Notes Trustee is not
the Registrar, the Company shall furnish, or cause the Registrar to furnish, to
the Senior Subordinated Notes Trustee, in writing at least five Business Days
before each interest payment date and at such other times as the Senior
Subordinated Notes Trustee may request in writing, a list in such form and as of
such date as the Senior Subordinated Notes Trustee may reasonably require of the
names and addresses of Senior Subordinated Noteholders.
SECTION 2.07. Transfer and Exchange. The Senior Subordinated Notes
shall be issued in registered form and shall be transferable only upon the
surrender of a Senior Subordinated Note for registration of transfer and in
compliance with the Appendix. When a Senior Subordinated Note is presented to
the Registrar with a request to register a transfer, the Registrar shall
register the transfer as requested if the requirements of Section 8-401(a)(l) of
the Uniform Commercial Code are met. When
27
Senior Subordinated Notes are presented to the Registrar with a request to
exchange them for an equal principal amount of Senior Subordinated Notes of
other denominations, the Registrar shall make the exchange as requested if the
same requirements are met. To permit registration of transfers and exchanges,
the Company shall execute and the Senior Subordinated Notes Trustee shall
authenticate Senior Subordinated Notes at the Registrar's request. The Company
may require payment of a sum sufficient to pay all taxes, assessments or other
governmental charges in connection with any transfer or exchange pursuant to
this Section. The Company shall not be required to make and the Registrar need
not register transfers or exchanges of Senior Subordinated Notes selected for
redemption (except, in the case of Senior Subordinated Notes to be redeemed in
part, the portion thereof not to be redeemed) or any Senior Subordinated Notes
for a period of 15 days before a selection of Senior Subordinated Notes to be
redeemed.
Prior to the due presentation for registration of transfer of any
Senior Subordinated Note, the Company, Holdings, the Senior Subordinated Notes
Trustee, the Paying Agent, and the Registrar may deem and treat the Person in
whose name a Senior Subordinated Note is registered as the absolute owner of
such Senior Subordinated Note for the purpose of receiving payment of principal
of and interest, if any, on such Senior Subordinated Note and for all other
purposes whatsoever, whether or not such Senior Subordinated Note is overdue,
and none of the Company, Holdings, the Senior Subordinated Notes Trustee, the
Paying Agent, or the Registrar shall be affected by notice to the contrary.
Any Holder of a Global Senior Subordinated Note shall, by acceptance
of such Global Senior Subordinated Note, agree that transfers of beneficial
interest in such Global Senior Subordinated Note may be effected only through a
book-entry system maintained by (i) the Senior Subordinated Noteholder of such
Global Senior Subordinated Note (or its agent) or (ii) any Senior Subordinated
Noteholder of a beneficial interest in such Global Senior Subordinated Note, and
that ownership of a beneficial interest in such Global Senior Subordinated Note
shall be required to be reflected in a book entry.
All Senior Subordinated Notes issued upon any transfer or exchange
pursuant to the terms of this Indenture will evidence the same debt and will be
entitled to the same benefits under this Indenture as the Senior Subordinated
Notes surrendered upon such transfer or exchange.
SECTION 2.08. Replacement Senior Subordinated Notes. If a mutilated
Senior Subordinated Note is surrendered to the Registrar or if the Senior
Subordinated Noteholder of a Senior Subordinated Note claims that the Senior
Subordinated Note has been lost, destroyed or wrongfully taken, the Company
shall issue and the Senior Subordinated Notes Trustee shall authenticate a
replacement Senior Subordinated Note if the requirements of Section 8-405 of the
Uniform Commercial Code are met, such that the Senior Subordinated Noteholder
(i) satisfies the Company or the Senior Subordinated Notes Trustee within a
reasonable time after he has notice of such loss, destruction or wrongful taking
and the Registrar does not register a transfer prior to receiving such
notification, (ii) makes such request to the Company or the Senior Subordinated
Notes Trustee prior to the Senior Subordinated Note being acquired by a
protected purchaser as defined in Section 8-303 of the Uniform Commercial Code
(a "protected purchaser") and (iii) satisfies any other reasonable requirements
of the Senior Subordinated Notes Trustee. If required by the Senior Subordinated
Notes Trustee or the Company, such
28
Senior Subordinated Noteholder shall furnish an indemnity bond sufficient in the
judgment of the Senior Subordinated Notes Trustee to protect the Company, the
Senior Subordinated Notes Trustee, the Paying Agent and the Registrar from any
loss that any of them may suffer if a Senior Subordinated Note is replaced. The
Company and the Senior Subordinated Notes Trustee may charge the Senior
Subordinated Noteholder for their expenses in replacing a Senior Subordinated
Note. In the event any such mutilated, lost, destroyed or wrongfully taken
Senior Subordinated Note has become or is about to become due and payable, the
Company in its discretion may pay such Senior Subordinated Note instead of
issuing a new Senior Subordinated Note in replacement thereof.
Every replacement Senior Subordinated Note is an additional
obligation of the Company.
The provisions of this Section 2.08 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, lost, destroyed or wrongfully taken Senior
Subordinated Notes.
SECTION 2.09. Outstanding Senior Subordinated Notes. Senior
Subordinated Notes outstanding at any time are all Senior Subordinated Notes
authenticated by the Senior Subordinated Notes Trustee except for those canceled
by it, those delivered to it for cancelation and those described in this Section
as not outstanding. A Senior Subordinated Note does not cease to be outstanding
because the Company or an Affiliate of the Company holds the Senior Subordinated
Note.
If a Senior Subordinated Note is replaced pursuant to Section 2.08,
it ceases to be outstanding unless the Senior Subordinated Notes Trustee and the
Company receive proof satisfactory to them that the replaced Senior Subordinated
Note is held by a protected purchaser.
If the Paying Agent segregates and holds in trust, in accordance
with this Indenture, on a redemption date or maturity date money sufficient to
pay all principal and interest payable on that date with respect to the Senior
Subordinated Notes (or portions thereof) to be redeemed or maturing, as the case
may be, and the Paying Agent is not prohibited from paying such money to the
Senior Subordinated Noteholders on that date pursuant to the terms of this
Indenture, then on and after that date such Senior Subordinated Notes (or
portions thereof) cease to be outstanding and interest on them ceases to accrue.
SECTION 2.10. Temporary Senior Subordinated Notes. In the event that
Definitive Senior Subordinated Notes (as defined in the Appendix) are to be
issued under the terms of this Indenture, until such Definitive Senior
Subordinated Notes are ready for delivery, the Company may prepare and the
Senior Subordinated Notes Trustee shall authenticate temporary Senior
Subordinated Notes. Temporary Senior Subordinated Notes shall be substantially
in the form of Definitive Senior Subordinated Notes but may have variations that
the Company considers appropriate for temporary Senior Subordinated Notes.
Without unreasonable delay, the Company shall prepare and the Senior
Subordinated Notes Trustee shall authenticate Definitive Senior Subordinated
Notes and deliver them in exchange for temporary Senior Subordinated Notes upon
surrender of such temporary Senior Subordinated Notes at the office or agency of
the Company, without charge to the Senior Subordinated Noteholder.
29
SECTION 2.11. Cancelation. The Company at any time may deliver
Senior Subordinated Notes to the Senior Subordinated Notes Trustee for
cancelation. The Registrar and the Paying Agent shall forward to the Senior
Subordinated Notes Trustee any Senior Subordinated Notes surrendered to them for
registration of transfer, exchange or payment. The Senior Subordinated Notes
Trustee and no one else shall can cel all Senior Subordinated Notes surrendered
for registration of transfer, exchange, payment or cancelation and deliver
canceled Senior Subordinated Notes to the Company pursuant to written direction
by an Officer. The Company may not issue new Senior Subordinated Notes to
replace Senior Subordinated Notes it has redeemed, paid or delivered to the
Senior Subordinated Notes Trustee for cancelation. The Senior Subordinated Notes
Trustee shall not authenticate Senior Subordinated Notes in place of canceled
Senior Subordinated Notes other than pursuant to the terms of this Indenture.
SECTION 2.12. Defaulted Interest. If the Company defaults in a
payment of interest on the Senior Subordinated Notes, the Company shall pay the
defaulted interest (plus interest on such defaulted interest at the rate of
91/8% per annum to the extent lawful) in any lawful manner. The Company may pay
the defaulted interest to the Persons who are Senior Subordinated Noteholders on
a subsequent special record date. The Company shall fix or cause to be fixed any
such special record date and payment date to the reasonable satisfaction of the
Senior Subordinated Notes Trustee and shall promptly mail or cause to be mailed
to each Senior Subordinated Noteholder a notice that states the special record
date, the payment date and the amount of defaulted interest to be paid.
SECTION 2.13. CUSIP Numbers. The Company in issuing the Senior
Subordinated Notes may use "CUSIP" numbers (if then generally in use) and, if
so, the Senior Subordinated Notes Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Senior Subordinated Noteholders; provided,
however, that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Senior Subordinated Notes
or as contained in any notice of a redemption and that reliance may be placed
only on the other identification numbers printed on the Senior Subordinated
Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers.
ARTICLE 3
Redemption
SECTION 3.01. Notices to Senior Subordinated Notes Trustee. If the
Company elects to redeem Senior Subordinated Notes pursuant to paragraph 5 of
the Senior Subordinated Notes, it shall notify the Senior Subordinated Notes
Trustee in writing of the redemption date and the principal amount of Senior
Subordinated Notes to be redeemed.
The Company shall give each notice to the Senior Subordinated Notes
Trustee provided for in this Section at least 60 days before the redemption date
unless the Senior Subordinated Notes Trustee consents to a shorter period. Such
notice shall be accompanied by an Officers' Certificate and an Opinion of
Counsel from the Company to the effect that such redemption will comply with the
conditions herein. If fewer than all the Senior Subordinated Notes are to be
redeemed, the record date relating to such
30
redemption shall be selected by the Company and given to the Senior Subordinated
Notes Trustee, which record date shall be not fewer than 15 days after the date
of notice to the Senior Subordinated Notes Trustee. Any such notice may be
canceled at any time prior to notice of such redemption being mailed to any
Senior Subordinated Noteholder and shall thereby be void and of no effect.
SECTION 3.02. Selection of Senior Subordinated Notes To Be Redeemed.
If fewer than all the Senior Subordinated Notes are to be redeemed, the Senior
Subordinated Notes Trustee shall select the Senior Subordinated Notes to be
redeemed pro rata or by lot. The Senior Subordinated Notes Trustee shall make
the selection from outstanding Senior Subordinated Notes not previously called
for redemption. The Senior Subordinated Notes Trustee may select for redemption
portions of the principal of Senior Subordinated Notes that have denominations
larger than $1,000. Senior Subordinated Notes and portions of them the Senior
Subordinated Notes Trustee selects shall be in amounts of $1,000 or a whole
multiple of $1,000. Provisions of this Indenture that apply to Senior
Subordinated Notes called for redemption also apply to portions of Senior
Subordinated Notes called for redemption. The Senior Subordinated Notes Trustee
shall notify the Company promptly of the Senior Subordinated Notes or portions
of Senior Subordinated Notes to be redeemed.
SECTION 3.03. Notice of Redemption. At least 30 days but not more
than 60 days before a date for redemption of Senior Subordinated Notes, the
Company shall mail a notice of redemption by first-class mail to each Senior
Subordinated Noteholder of Senior Subordinated Notes to be redeemed at such
Senior Subordinated Noteholder's registered address.
The notice shall identify the Senior Subordinated Notes to be
redeemed and shall state:
(1) the redemption date;
(2) the redemption price and the amount of accrued interest to the
redemption date;
(3) the name and address of the Paying Agent;
(4) that Senior Subordinated Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Senior Subordinated Notes are
to be redeemed, the certificate numbers and principal amounts of the
particular Senior Subordinated Notes to be redeemed;
(6) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment
pursuant to the terms of this Indenture, interest on Senior Subordinated
Notes (or portion thereof) called for redemption ceases to accrue on and
after the redemption date;
(7) the CUSIP number, if any, printed on the Senior Subordinated
Notes being redeemed;
31
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Senior Subordinated Notes; and
(9) if applicable, that a Change of Control has occurred and the
circumstances and relevant facts regarding such Change of Control.
At the Company's request, the Senior Subordinated Notes Trustee
shall give the notice of redemption in the Company's name and at the Company's
expense. In such event, the Company shall provide the Senior Subordinated Notes
Trustee with the information required by this Section.
SECTION 3.04. Effect of Notice of Redemption. Once notice of
redemption is mailed, Senior Subordinated Notes called for redemption become due
and payable on the redemption date and at the redemption price stated in the
notice. Upon surrender to the Paying Agent, such Senior Subordinated Notes shall
be paid at the redemption price stated in the notice, plus accrued interest, if
any, to the redemption date; provided, however, that if the redemption date is
after a regular record date and on or prior to the interest payment date, the
accrued interest shall be payable to the Senior Subordinated Noteholder of the
redeemed Senior Subordinated Notes registered on the relevant record date.
Failure to give notice or any defect in the notice to any Senior Subordinated
Noteholder shall not affect the validity of the notice to any other Senior
Subordinated Noteholder.
SECTION 3.05. Deposit of Redemption Price. Prior to 10:00 a.m. on
the redemption date, the Company shall deposit with the Paying Agent (or, if the
Company or a Subsidiary is the Paying Agent, shall segregate and hold in trust)
money sufficient to pay the redemption price of and accrued interest on all
Senior Subordinated Notes to be redeemed on that date other than Senior
Subordinated Notes or portions of Senior Subordinated Notes called for
redemption that have been delivered by the Company to the Senior Subordinated
Notes Trustee for cancelation.
SECTION 3.06. Senior Subordinated Notes Redeemed in Part. Upon
surrender of a Senior Subordinated Note that is redeemed in part, the Company
shall execute and the Senior Subordinated Notes Trustee shall authenticate for
the Senior Subordinated Noteholder (at the Company's expense) a new Senior
Subordinated Note equal in principal amount to the unredeemed portion of the
Senior Subordinated Note surrendered.
ARTICLE 4
Covenants
SECTION 4.01. Payment of Senior Subordinated Notes. The Company
shall promptly pay the principal of and interest on the Senior Subordinated
Notes on the dates and in the manner provided in the Senior Subordinated Notes
and in this Indenture. Principal and interest shall be considered paid on the
date due if on such date the Senior Subordinated Notes Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Senior Subordinated Notes Trustee or the
Paying Agent, as the case may be, is not prohibited from paying
32
such money to the Senior Subordinated Noteholders on that date pursuant to the
terms of this Indenture.
The Company shall pay interest on overdue principal at the rate
specified therefor in the Senior Subordinated Notes, and it shall pay interest
on overdue installments of interest at the same rate to the extent lawful.
SECTION 4.02. SEC Reports. Notwithstanding that the Company may not
be subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall file with the SEC and provide the Senior Subordinated
Notes Trustee and any Senior Subordinated Noteholder or prospective Senior
Subordinated Noteholder (upon the request of such Senior Subordinated Noteholder
or prospective Senior Subordinated Noteholder) with such annual reports and such
information, documents and other reports as are specified in Sections 13 and
15(d) of the Exchange Act and applicable to a U.S. corporation subject to such
Sections, such information, documents and other reports to be so filed and
provided at the times specified for the filing of such information, documents
and reports under such Sections.
SECTION 4.03. Limitation on Indebtedness. (a) The Company shall not,
and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness; provided, however, that the Company may Incur
Indebtedness if on the date of such Incurrence and after giving effect thereto
the Consolidated Coverage Ratio would be greater than 2.00:1.00.
(b) Notwithstanding Section 4.03(a), the Company and its Restricted
Subsidiaries may Incur the following Indebtedness:
(i) Indebtedness Incurred pursuant to the Credit Agreement or any
other Credit Facility in an aggregate principal amount at any time
outstanding not to exceed $400 million;
(ii) Indebtedness of the Company owed to and held by any Wholly
Owned Subsidiary or Indebtedness of a Restricted Subsidiary owed to and
held by the Company or any Wholly Owned Subsidiary; provided, however,
that (A) any subsequent issuance or transfer of any Capital Stock or any
other event that results in any such Wholly Owned Subsidiary ceasing to be
a Wholly Owned Subsidiary or any subsequent transfer of any such
Indebtedness (except to the Company or a Wholly Owned Subsidiary) shall be
deemed, in each case, to constitute the Incurrence of such Indebtedness by
the issuer thereof and (B) if the Company is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the prior
payment in full in cash of all obligations with respect to the Senior
Subordinated Notes;
(iii) Indebtedness (A) represented by the Senior Subordinated Notes
(not including any Additional Senior Subordinated Notes), (B) outstanding
on the Closing Date (other than the Indebtedness described in clauses (i)
and (ii) above), (C) consisting of Refinancing Indebtedness Incurred in
respect of any Indebtedness described in this clause (iii) (including
Indebtedness Refinancing Refinancing Indebtedness) or Section 4.03(a) and
(D) consisting of Guarantees of any Indebtedness permitted under clauses
(i) and (ii) of this paragraph (b);
33
(iv) (A) Indebtedness of a Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted Subsidiary
was acquired by the Company (other than Indebtedness Incurred as
consideration in, or to provide all or any portion of the funds or credit
support utilized to consummate, the transaction or series of related
transactions pursuant to which such Restricted Subsidiary became a
Subsidiary of or was otherwise acquired by the Company); provided,
however, if the aggregate amount of all such Indebtedness of all such
Restricted Subsidiaries would exceed $20 million, that on the date that
such Restricted Subsidiary is acquired by the Company, the Company would
have been able to Incur $1.00 of additional Indebtedness pursuant to
Section 4.03(a) after giving effect to the Incurrence of such Indebtedness
pursuant to this clause (iv) and (B) Refinancing Indebtedness Incurred by
a Restricted Subsidiary in respect of Indebtedness Incurred by such
Restricted Subsidiary pursuant to this clause (iv);
(v) Indebtedness (A) in respect of performance bonds, bankers'
acceptances, letters of credit and surety or appeal bonds provided by the
Company and the Restricted Subsidiaries in the ordinary course of their
business, and (B) under Hedging Obligations consisting of Interest Rate
Agreements directly related (as determined in good faith by the Company)
to Indebtedness permitted to be Incurred by the Company and its Restricted
Subsidiaries pursuant to this Indenture and Currency Agreements Incurred
in the ordinary course of business;
(vi) Indebtedness Incurred by the Company or any Restricted
Subsidiary (including Capitalized Lease Obligations) financing the
purchase, lease or improvement of property (real or personal) or equipment
(whether through the direct purchase of assets or the Capital Stock of the
Person owning such assets), in each case Incurred no more than 180 days
after such purchase, lease or improvement of such property and any
Refinancing Indebtedness in respect of such Indebtedness; provided,
however, that at the time of the Incurrence of such Indebtedness and after
giving effect thereto, the aggregate principal amount of all Indebtedness
incurred pursuant to this clause (vi) and then outstanding shall not
exceed the greater of $25.0 million and 5% of Adjusted Consolidated
Assets;
(vii) Indebtedness Incurred by the Company in connection with the
acquisition of a Related Business and any Refinancing Indebtedness in
respect of such Indebtedness; provided, however, that the aggregate amount
of Indebtedness Incurred and outstanding pursuant to this clause (vii)
shall not exceed $50.0 million at any one time;
(viii) Attributable Debt Incurred by the Company in respect of
Sale/Leaseback Transactions; provided, however, that the aggregate amount
of Attributable Debt Incurred and outstanding pursuant to this clause
(viii) shall not exceed $75.0 million at any one time;
(ix) Indebtedness arising from agreements of the Company or a
Restricted Subsidiary providing for indemnification, purchase price
adjustment or similar obligations, in each case, Incurred or assumed in
connection with the disposition of any business, assets or a Subsidiary,
other than Guarantees of Indebtedness Incurred by any Person acquiring all
or any portion of such business, assets or a
34
Subsidiary for the purpose of financing such acquisition; provided,
however, that the maximum assumable liability in respect of all such
Indebtedness shall at no time exceed the gross proceeds actually received
by the Company and its Restricted Subsidiaries in connection with such
disposition;
(x) any Guarantee by the Company of Indebtedness or other
obligations of any of its Restricted Subsidiaries so long as the
Incurrence of such Indebtedness Incurred by such Restricted Subsidiary is
permitted under the terms of this Indenture;
(xi) Indebtedness arising from Guarantees to suppliers, lessors,
licensees, contractors, franchisees or customers Incurred in the ordinary
course of business;
(xii) Indebtedness Incurred by a Receivables Entity in a Qualified
Receivables Transaction that is not recourse to the Company or any other
Restricted Subsidiary of the Company (except for Standard Securitization
Undertakings); and
(xiii) Indebtedness (other than Indebtedness permitted to be
Incurred pursuant to Section 4.03(a) or any other clause of this Section
4.03(b)) in an aggregate principal amount on the date of Incurrence that,
when added to all other Indebtedness Incurred pursuant to this clause
(xiii) and then outstanding, shall not exceed $50.0 million.
(c) The Company shall not Incur any Indebtedness if such
Indebtedness is subordinate or junior in ranking in any respect to any Senior
Indebtedness of the Company unless such Indebtedness is Senior Subordinated
Indebtedness of the Company or is expressly subordinated in right of payment to
Senior Subordinated Indebtedness of the Company.
(d) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or any Restricted Subsidiary may
Incur pursuant to this Section shall not be deemed to be exceeded solely as a
result of fluctuations in the exchange rates of currencies. For purposes of
determining the outstanding principal amount of any particular Indebtedness
Incurred pursuant to this Section 4.03, (i) Indebtedness permitted by this
Section 4.03 need not be permitted solely by reference to one provision
permitting such Indebtedness but may be permitted in part by one such provision
and in part by one or more other provisions of this Section permitting such
Indebtedness and (ii) in the event that Indebtedness meets the criteria of more
than one of the types of Indebtedness described in this Section, the Company, in
its sole discretion, shall classify or reclassify such Indebtedness and only be
required to include the amount of such Indebtedness in one of such clauses.
SECTION 4.04. Limitation on Restricted Payments. (a) The Company
shall not, and shall not permit any Restricted Subsidiary, directly or
indirectly, to (i) declare or pay any dividend or make any distribution on or in
respect of its Capital Stock (including any payment in connection with any
merger or consolidation involving the Company) or similar payment to the direct
or indirect holders of its Capital Stock except dividends or distributions
payable solely in its Capital Stock (other than Disqualified Stock) and except
dividends or distributions payable to the Company or another Restricted
Subsidiary (and, if such Restricted Subsidiary has equity holders other
35
than the Company or other Restricted Subsidiaries, to its other equity holders
on a pro rata basis), (ii) purchase, redeem, retire or otherwise acquire for
value any Capital Stock of Holdings, the Company or any Restricted Subsidiary
held by Persons other than the Company or another Restricted Subsidiary, (iii)
purchase, repurchase, redeem, defease or otherwise acquire or retire for value,
prior to scheduled maturity, scheduled repayment or scheduled sinking fund
payment any Subordinated Obligations of the Company (other than the purchase,
repurchase or other acquisition of Subordinated Obligations of the Company
purchased in anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the date of
acquisition) or (iv) make any Investment (other than a Permitted Investment) in
any Person (any such dividend, distribution, purchase, redemption, repurchase,
defeasance, other acquisition, retirement or Investment being herein referred to
as a "Restricted Payment") if at the time the Company or such Restricted
Subsidiary makes such Restricted Payment:
(1) a Default shall have occurred and be continuing (or would result
therefrom);
(2) the Company could not Incur at least $1.00 of additional
Indebtedness under Section 4.03(a); or
(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments (the amount so expended, if other than in cash, to be
determined in good faith by the Board of Directors, whose determination
shall be conclusive and evidenced by a resolution of the Board of
Directors) declared or made subsequent to the Closing Date would exceed
the sum of:
(A) 50% of the Consolidated Net Income accrued during the
period (treated as one accounting period) from the beginning of the
fiscal quarter immediately following the fiscal quarter during which
the Closing Date occurs to the end of the most recent fiscal quarter
for which internal financial statements are available prior to the
date of such Restricted Payment (or, in case such Consolidated Net
Income will be a deficit, minus 100% of such deficit);
(B) the aggregate Net Cash Proceeds or fair market value of
assets or property received by the Company as a contribution to its
equity capital or from the issue or sale of its Capital Stock (in
each case other than Disqualified Stock and Excluded Contributions)
subsequent to the Closing Date (other than an issuance or sale to
(x) a Subsidiary of the Company or (y) an employee stock ownership
plan or other trust established by the Company or any of its
Subsidiaries);
(C) the amount by which Indebtedness or Disqualified Stock of
the Company or its Restricted Subsidiaries is reduced on the
Company's balance sheet upon the conversion or exchange (other than
by a Subsidiary of the Company) subsequent to the Closing Date of
any Indebtedness or Disqualified Stock of the Company or its
Restricted Subsidiaries issued after the Closing Date for Capital
Stock (other than Disqualified Stock) of the Company (less the
amount of any cash or the fair market value of other property
distributed by the Company or any Restricted Subsidiary upon such
conversion or exchange); and
36
(D) the amount equal to the net reduction in Investments in
any Person (other than a Restricted Subsidiary) resulting from (i)
payments of dividends, repayments of the principal of loans or
advances or other transfers of assets to the Company or any
Restricted Subsidiary from such Person, (ii) the sale or liquidation
for cash of such Investment or (iii) the redesignation of
Unrestricted Subsidiaries as Restricted Subsidiaries (valued in each
case as provided in the definition of "Investment") not to exceed,
in the case of any Unrestricted Subsidiary, the amount of
Investments previously made by the Company or any Restricted
Subsidiary in such Unrestricted Subsidiary, which amount was
included in the calculation of the amount of Restricted Payments.
(b) The provisions of Section 4.04(a) shall not prohibit:
(i) any Restricted Payment made by exchange for, or out of the
proceeds of the substantially concurrent sale of, Capital Stock of the
Company (other than Disqualified Stock and other than Capital Stock issued
or sold to a Subsidiary of the Company or an employee stock ownership plan
or other trust established by the Company or any of its Subsidiaries);
provided, however, that (A) such Restricted Payment shall be excluded in
the calculation of the amount of Restricted Payments and (B) the Net Cash
Proceeds from such sale applied in the manner set forth in this clause (i)
shall be excluded from the calculation of amounts under Section
4.04(a)(3)(B);
(ii) any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations of the
Company made by exchange for, or out of the proceeds of the substantially
concurrent sale of, Indebtedness of the Company that is permitted to be
Incurred pursuant to Section 4.03(b); provided, however, that such
purchase, repurchase, redemption, defeasance or other acquisition or
retirement for value shall be excluded in the calculation of the amount of
Restricted Payments;
(iii) any purchase or redemption of Subordinated Obligations of the
Company from Net Available Cash to the extent permitted by Section 4.06;
provided, however, that such purchase or redemption shall be excluded in
the cal culation of the amount of Restricted Payments;
(iv) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with Section 4.04(a); provided, however, that such dividend shall be
included in the calculation of the amount of Restricted Payments;
(v) any Restricted Payment made for the repurchase, redemption or
other acquisition or retirement for value of any Capital Stock of
Holdings, the Company or any of their respective Subsidiaries held by any
employee, former employee, director or former director of Holdings, the
Company or any of their respective Subsidiaries (and any permitted
transferees thereof) pursuant to any equity subscription agreement, stock
option agreement or plan or other similar agreement; provided, however,
that the aggregate amount of such Restricted Payments shall not exceed
$5.0 million in any calendar year and $20.0 million in
37
the aggregate; provided further, however, that such Restricted Payments
shall be included in the calculation of the amount of Restricted Payments;
(vi) payment of dividends, other distributions or other amounts by
the Company for the purposes set forth in clauses (A) through (E) below;
provided, however, that such dividend, distribution or amount shall be
excluded in the calculation of the amount of Restricted Payments:
(A) to Holdings in amounts equal to the amounts required for
Holdings to pay franchise taxes and other fees required to maintain
its corporate existence and provide for other operating costs of up
to $2.0 million per calendar year;
(B) to Holdings in amounts equal to amounts required for
Holdings to pay Federal, state and local income taxes that are then
actually due and owing by Holdings to the extent such items relate
to the Company and its Subsidiaries;
(C) to Holdings to permit Holdings to pay financial advisory,
financing, underwriting or placement fees to Cypress and its
Affiliates;
(D) to Holdings to permit Holdings to pay any employment,
noncompetition, compensation or confidentiality arrangements entered
into with its employees in the ordinary course of business to the
extent such employees are primarily engaged in activities which
relate to the Company and its Subsidiaries; and
(E) to Holdings to permit Holdings to pay customary fees and
indemnities to directors and officers of Holdings to the extent such
directors and officers are primarily engaged in activities which
relate to the Company and its Subsidiaries;
(vii) following the initial Equity Offering by the Company or
Holdings, any payment of dividends or common stock buybacks by the Company
in an aggregate amount in any year not to exceed 6% of the aggregate Net
Cash Proceeds actually received by the Company in connection with such
initial Equity Offering and any subsequent Equity Offering by the Company
or Holdings; provided, however, that no Default or Event of Default shall
have occurred and be continuing immediately before or after any such
payment; provided further, however, that such dividends or common stock
buybacks shall be included in the calculation of the amount of Restricted
Payments;
(viii) any repurchase of Capital Stock deemed to occur upon exercise
of stock options if such Capital Stock represents a portion of the
exercise price of such option; provided, however, that such repurchase
shall be included in the calculation of the amount of Restricted Payments;
(ix) the payment of any dividend or the making of any distribution
to Holdings in amounts sufficient to permit Holdings (A) to pay interest
when due on the Senior Discount Notes and (B) to make any mandatory
redemptions, repurchases or principal or accreted value payments in
respect of the Senior
38
Discount Notes; provided, however, that such payments, dividends and
distributions shall be excluded in the calculation of the amount of
Restricted Payments;
(x) the declaration and payment of dividends to holders of any class
or series of Disqualified Stock of the Company issued in accordance with
Section 4.03(b) to the extent such dividends are included in the
definition of Consolidated Interest Expense; provided, however, that such
dividends shall be included in the calculation of the amount of Restricted
Payments;
(xi) Investments made with Excluded Contributions; provided,
however, that such Investments shall be excluded in the calculation of the
amount of Restricted Payments;
(xii) any Restricted Payment made to fund the Recapitalization
(including fees and expenses); provided, however, that such Restricted
Payment shall be excluded in the calculation of the amount of Restricted
Payments; or
(xiii) other Restricted Payments in an aggregate amount not to
exceed $10.0 million; provided, however, that such payments shall be
included in the calculation of the amount of Restricted Payments.
SECTION 4.05. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Company shall not, and shall not permit any
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to (i) pay dividends or make any other distributions on
its Capital Stock or pay any Indebtedness or other obligations owed to the
Company, (ii) make any loans or advances to the Company or (iii) transfer any of
its property or assets to the Company, except:
(1) any encumbrance or restriction pursuant to an agreement in
effect at or entered into on the Closing Date;
(2) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary on or prior to the date on which such
Restricted Subsidiary was acquired by the Company (other than Indebtedness
Incurred as consideration in, in contemplation of, or to provide all or
any portion of the funds or credit support utilized to consummate the
transaction or series of related transactions pursuant to which such
Restricted Subsidiary became a Restricted Subsidiary or was otherwise
acquired by the Company) and outstanding on such date;
(3) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness Incurred pursuant to an agreement
referred to in clause (1) or (2) of this Section 4.05 or this clause (3)
or contained in any amendment to an agreement referred to in clause (1) or
(2) of this Section 4.05 or this clause (3); provided, however, that the
encumbrances and restrictions contained in any such Refinancing agreement
or amendment are no less favorable to the Senior Subordinated Noteholders
than the encumbrances and restrictions contained in such predecessor
agreements;
39
(4) in the case of clause (iii), any encumbrance or restriction (A)
that restricts in a customary manner the subletting, assignment or
transfer of any property or asset that is subject to a lease, license or
similar contract, (B) contained in security agreements or mortgages
securing Indebtedness of a Restricted Subsidiary to the extent such
encumbrance or restriction restricts the transfer of the property subject
to such security agreements or mortgages or (C) in connection with
purchase money obligations for property acquired in the ordinary course of
business;
(5) with respect to a Restricted Subsidiary, any restriction imposed
pursuant to an agreement entered into for the sale or disposition of all
or substantially all the Capital Stock or assets of such Restricted
Subsidiary pending the closing of such sale or disposition;
(6) any encumbrance or restriction of a Receivables Entity effected
in connection with a Qualified Receivables Transaction; provided, however,
that such restrictions apply only to such Receivables Entity; and
(7) any encumbrance or restriction existing pursuant to other
Indebtedness permitted to be Incurred subsequent to the Senior
Subordinated Notes Issue Date pursuant to Section 4.03; provided, however,
that any such encumbrance or restrictions are ordinary and customary with
respect to the type of Indebtedness being Incurred (under the relevant
circumstances).
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock.
(a) The Company shall not, and shall not permit any Restricted Subsidiary to,
make any Asset Disposition unless (i) the Company or such Restricted Subsidiary
receives consideration (including by way of relief from, or by any other Person
assuming sole responsibility for, any liabilities, contingent or otherwise) at
the time of such Asset Disposition at least equal to the fair market value (as
determined in good faith by the Company) of the shares and assets subject to
such Asset Disposition, (ii) at least 75% of the consideration thereof received
by the Company or such Restricted Subsidiary is in the form of cash or cash
equivalents (provided that the amount of (w) any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance sheet or in the
notes thereto) of the Company or any Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Senior Subordinated
Notes) that are assumed by the transferee of any such assets without recourse to
the Company or any of the Restricted Subsidiaries, (x) any notes or other
obligations received by the Company or such Restricted Subsidiary from such
transferee that are converted by the Company or such Restricted Subsidiary into
cash (to the extent of the cash received) within 180 days following the closing
of such Asset Disposition, (y) any Designated Noncash Consideration received by
the Company or any of its Restricted Subsidiaries in such Asset Disposition
having an aggregate fair market value, taken together with all other Designated
Noncash Consideration received pursuant to this clause (y) that is at that time
outstanding, not to exceed 5% of Adjusted Consolidated Assets at the time of the
receipt of such Designated Noncash Consideration (with the fair market value of
each item of Designated Noncash Consideration being measured at the time
received and without giving effect to subsequent changes in value) and (z) any
assets received in exchange for assets related to a Related Business of
comparable market value in the good faith determination of the Board of
Directors shall be deemed to be cash for purposes of this provision) and (iii)
an amount equal to 100% of the Net Available Cash from such Asset
40
Disposition is applied by the Company (or such Restricted Subsidiary, as the
case may be) (A) first, to the extent the Company elects (or is required by the
terms of any Indebtedness), to prepay, repay, redeem or purchase Senior
Indebtedness of the Company or Indebtedness (other than any Disqualified Stock
and other than any Preferred Stock) of a Wholly Owned Subsidiary (in each case
other than Indebtedness owed to the Company or an Affiliate of the Company)
within 365 days after the later of the date of such Asset Disposition or the
receipt of such Net Available Cash; (B) second, to the extent of the balance of
Net Available Cash after application in accordance with clause (A), to the
extent the Company or such Restricted Subsidiary elects, to reinvest in
Additional Assets (including by means of an Investment in Additional Assets by a
Restricted Subsidiary with Net Available Cash received by the Company or another
Restricted Subsidiary) within 365 days from the later of such Asset Disposition
or the receipt of such Net Available Cash; and (C) third, to the extent of the
balance of such Net Available Cash after application in accordance with clauses
(A) and (B), to make an Offer (as defined below) to purchase Senior Subordinated
Notes pursuant to and subject to the conditions of Section 4.06(b); provided,
however, that if the Company elects (or is required by the terms of any other
Senior Subordinated Indebtedness of the Company), such Offer may be made ratably
to purchase the Senior Subordinated Notes and other Senior Subordinated
Indebtedness of the Company; provided, however, that in connection with any
prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (C)
above, the Company or such Restricted Subsidiary shall retire such Indebtedness
and shall cause the related loan commitment (if any) to be permanently reduced
in an amount equal to the principal amount so prepaid, repaid or purchased.
Notwithstanding the foregoing provisions of this Section 4.06, the Company and
the Restricted Subsidiaries shall not be required to apply any Net Available
Cash in accordance with this Section 4.06(a) except to the extent that the
aggregate Net Available Cash from all Asset Dispositions that is not applied in
accordance with this Section 4.06 (a) exceeds $20.0 million.
(b) In the event of an Asset Disposition that requires the purchase
of Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the
Company) pursuant to Section 4.06(a)(iii)(C), the Company shall be required to
purchase Senior Subordinated Notes (and other Senior Subordinated Indebtedness
of the Company) tendered pursuant to an offer by the Company for the Senior
Subordinated Notes (and other Senior Subordinated Indebtedness of the Company)
(the "Offer") at a purchase price of 100% of their principal amount plus accrued
and unpaid interest and liquidated damages, if any, to the date of purchase in
accordance with the procedures (including prorating in the event of
oversubscription), set forth in Section 4.06(c). If the aggregate purchase price
of Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the
Company) tendered pursuant to the Offer is less than the Net Available Cash
allotted to the purchase of the Senior Subordinated Notes (and other Senior
Subordinated Indebtedness of the Company), the Company may apply the remaining
Net Available Cash for any purpose permitted by the terms of this Indenture. The
Company shall not be required to make an Offer for Senior Subordinated Notes
(and other Senior Subordinated Indebtedness of the Company) pursuant to this
Section 4.06 if the Net Available Cash available therefor (after application of
the proceeds as provided in clauses (A) and (B) of Section 4.06(a)(iii)) is less
than $10.0 million for any particular Asset Disposition (which lesser amount
shall be carried forward for purposes of determining whether an Offer is
required with respect to the Net Available Cash from any subsequent Asset
Disposition).
41
(c) (1) Promptly, and in any event within 30 days after the Company
becomes obligated to make an Offer, the Company shall be obligated to deliver to
the Senior Subordinated Notes Trustee and send, by first-class mail to each
Senior Subordinated Noteholder, a written notice stating that the Senior
Subordinated Noteholder may elect to have his Senior Subordinated Notes
purchased by the Company either in whole or in part (subject to prorating as
hereinafter described in the event the Offer is oversubscribed) in integral
multiples of $1,000 of principal amount, at the applicable purchase price. The
notice shall specify a purchase date not less than 30 days nor more than 60 days
after the date of such notice (the "Purchase Date") and shall contain or
incorporate by reference such information concerning the business of the Company
which the Company in good faith believes will enable such Senior Subordinated
Noteholders to make an informed decision and all instructions and materials
necessary to tender Senior Subordinated Notes pursuant to the Offer, together
with the address referred to in clause (3).
(2) Not later than the date upon which written notice of an Offer is
delivered to the Senior Subordinated Notes Trustee as provided above, the
Company shall deliver to the Senior Subordinated Notes Trustee an Officers'
Certificate as to (i) the amount of the Offer (the "Offer Amount"), (ii) the
allocation of the Net Available Cash from the Asset Dispositions pursuant to
which such Offer is being made and (iii) the compliance of such allocation with
the provisions of Section 4.06(a). On such date, the Company shall also
irrevocably deposit with the Senior Subordinated Notes Trustee or with a paying
agent (or, if the Company is acting as its own paying agent, segregate and hold
in trust) an amount equal to the Offer Amount to be invested in Temporary Cash
Investments and to be held for payment in accordance with the provisions of this
Section. Upon the expiration of the period for which the Offer remains open (the
"Offer Period"), the Company shall deliver to the Senior Subordinated Notes
Trustee for cancelation the Senior Subordinated Notes or portions thereof that
have been properly tendered to and are to be accepted by the Company. The Senior
Subordinated Notes Trustee (or the Paying Agent, if not the Senior Subordinated
Notes Trustee) shall, on the date of purchase, mail or deliver payment to each
tendering Senior Subordinated Noteholder in the amount of the purchase price. In
the event that the aggregate purchase price of the Senior Subordinated Notes
(and other Senior Subordinated Indebtedness of the Company) delivered by the
Company to the Senior Subordinated Notes Trustee is less than the Offer Amount
applicable to the Senior Subordinated Notes (and other Senior Subordinated
Indebtedness of the Company), the Senior Subordinated Notes Trustee shall
deliver the excess to the Company immediately after the expiration of the Offer
Period for application in accordance with this Section 4.06.
(3) Senior Subordinated Noteholders electing to have a Senior
Subordinated Note purchased shall be required to surrender the Senior
Subordinated Note, with an appropriate form duly completed, to the Company at
the address specified in the notice at least three Business Days prior to the
Purchase Date. Senior Subordinated Noteholders shall be entitled to withdraw
their election if the Senior Subordinated Notes Trustee or the Company receives
not later than one Business Day prior to the Purchase Date, a telegram, telex,
facsimile transmission or letter setting forth the name of the Senior
Subordinated Noteholder, the principal amount of the Senior Subordinated Note
which was delivered by the Senior Subordinated Noteholder for purchase and a
statement that such Senior Subordinated Noteholder is withdrawing his election
to have such Senior Subordinated Note purchased. If at the expiration of the
Offer Period the aggregate principal amount of Senior Subordinated Notes and any
other
42
Senior Subordinated Indebtedness of the Company included in the Offer
surrendered by holders thereof exceeds the Offer Amount, the Company shall
select the Senior Subordinated Notes and other Senior Subordinated Indebtedness
of the Company to be purchased on a pro rata basis (with such adjustments as may
be deemed appropriate by the Company so that only Senior Subordinated Notes and
other Senior Subordinated Indebtedness of the Company in denominations of
$1,000, or integral multiples thereof, shall be purchased). Senior Subordinated
Noteholders whose Senior Subordinated Notes are purchased only in part will be
issued new Senior Subordinated Notes equal in princi pal amount to the
unpurchased portion of the Senior Subordinated Notes surrendered.
(4) At the time the Company delivers Senior Subordinated Notes to
the Senior Subordinated Notes Trustee which are to be accepted for purchase, the
Company shall also deliver an Officers' Certificate stating that such Senior
Subordinated Notes are to be accepted by the Company pursuant to and in
accordance with the terms of this Sec tion. A Senior Subordinated Note shall be
deemed to have been accepted for purchase at the time the Senior Subordinated
Notes Trustee, directly or through an agent, mails or delivers payment therefor
to the surrendering Senior Subordinated Noteholder.
(d) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Senior Subordinated Notes
pursuant to this Section. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Section, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section by virtue thereof.
SECTION 4.07. Limitation on Transactions with Affiliates. (a) The
Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or
assets from, or enter into or make or amend any transaction, contract,
agreement, understanding, loan, advance or Guarantee with, or for the benefit
of, any Affiliate (each of the foregoing, an "Affiliate Transaction") involving
aggregate consideration in excess of $5.0 million, unless (i) such Affiliate
Transaction is on terms that are not materially less favorable to the Company or
the relevant Restricted Subsidiary than those that would have been obtained in a
comparable transaction by the Company or such Restricted Subsidiary with an
unrelated Person and (ii) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration in excess of
$10.0 million, the Company delivers to the Senior Subordinated Notes Trustee a
resolution adopted by the majority of the Board of Directors, approving such
Affiliate Transaction and set forth in an Officers' Certificate certifying that
such Affiliate Transaction complies with clause (i) above.
(b) The provisions of Section 4.07(a) shall not prohibit (i) any
Restricted Payment permitted to be paid pursuant to Section 4.04, (ii) any
issuance of securities, or other payments, Guarantees, awards or grants in cash,
securities or otherwise pursuant to, or the funding of, employment arrangements,
stock options and stock ownership plans approved by the Board of Directors,
(iii) the grant of stock options or similar rights to employees and directors of
the Company pursuant to plans approved by the Board of Directors, (iv) loans or
advances to employees in the ordinary course of business in accordance with past
practices of the Company, but in any event not to exceed $5.0 million in the
aggregate outstanding at any one time, (v) the payment of reasonable fees
43
to directors of the Company and its Restricted Subsidiaries who are not
employees of the Company or its Subsidiaries, (vi) any transaction between the
Company and a Restricted Subsidiary or between Restricted Subsidiaries, (vii)
any transaction effected as part of a Qualified Receivables Transaction, (viii)
any payment by the Company to Holdings to permit Holdings to pay any Federal,
state, local or other taxes that are then actually due and owing by Holdings,
(ix) indemnification agreements with, and the payment of fees and indemnities
to, directors, officers and employees of the Company and its Restricted
Subsidiaries, in each case, in the ordinary course of business, (x) any
employment, compensation, noncompetition or confidentiality agreement entered
into by the Company and its Restricted Subsidiaries with its employees in the
ordinary course of business, (xi) the payment by the Company of fees, expenses
and other amounts to Cypress and its Affiliates in connection with the
Recapitalization, (xii) payments by the Company or any of its Restricted
Subsidiaries to Cypress and its Affiliates made pursuant to any financial
advisory, financing, underwriting or placement agreement, or in respect of other
investment banking activities, in each case, as determined by the Board of
Directors in good faith, (xiii) any issuance of Capital Stock of the Company
(other than Disqualified Stock), (xiv) any agreement as in effect as of the date
of this Indenture or any amendment or replacement hereto so long as any such
amendment or replacement agreement is not more disadvantageous to the Senior
Subordinated Noteholders of the Senior Subordinated Notes in any material
respect than the original agreement as in effect on the Closing Date and (xv)
transactions in which the Company or any of its Restricted Subsidiaries, as the
case may be, delivers to the Senior Subordinated Notes Trustee a letter from an
Independent Financial Advisor stating that such transaction is fair to the
Company or such Restricted Subsidiary from a financial point of view or meets
the requirements of Section 4.07(a).
SECTION 4.08. Change of Control. (a) Upon the occurrence of a Change
of Control, unless all Senior Subordinated Notes have been called for redemption
pursuant to paragraph 5 of the Senior Subordinated Notes, each Senior
Subordinated Noteholder shall have the right to require the Company to
repurchase all or any part of such Senior Subordinated Noteholder's Senior
Subordinated Notes at a purchase price in cash equal to 101% of the principal
amount thereof plus accrued and unpaid interest and liquidated damages, if any,
to the date of repurchase (subject to the right of Senior Subordinated
Noteholders of record on the relevant record date to receive interest due on the
relevant interest payment date), in accordance with Section 4.08(b). Prior to
the mailing of the notice referred to below, but in any event within 30 days
following the date on which the Company becomes aware that a Change of Control
has occurred, if the purchase of the Senior Subordinated Notes would violate or
constitute a default under any other Indebtedness of the Company, then the
Company shall, to the extent needed to permit such purchase of Senior
Subordinated Notes, either (i) repay all such Indebtedness and terminate all
commitments outstanding thereunder or (ii) request the holders of such
Indebtedness to give the requisite consents to permit the purchase of the Senior
Subordinated Notes as provided below. Until such time as the Company is able to
repay all such Indebtedness and terminate all commitments outstanding thereunder
or such time as such requisite consents are obtained, the Company shall not be
required to make the Change of Control Offer or purchase the Senior Subordinated
Notes pursuant to the provisions described below.
(b) Within 30 days following any Change of Control, unless all
Senior Subordinated Notes have been called for redemption pursuant to paragraph
5 of the Senior Subordinated Notes, the Company shall mail a notice to each
Senior Subordinated
44
Noteholder with a copy to the Senior Subordinated Notes Trustee (the "Change of
Control Offer") stating:
(1) that a Change of Control has occurred and that such Senior
Subordinated Noteholder has the right to require the Company to purchase
such Senior Subordinated Noteholder's Senior Subordinated Notes at a
purchase price in cash equal to 101% of the principal amount thereof, plus
accrued and unpaid interest and liquidated damages, if any, to the date of
repurchase (subject to the right of Senior Subordinated Noteholders of
record on the relevant record date to receive interest on the relevant
interest payment date);
(2) the circumstances and relevant facts regarding such Change of
Control;
(3) the repurchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); and
(4) the instructions determined by the Company, consistent with this
Section, that a Senior Subordinated Noteholder must follow in order to
have its Senior Subordinated Notes repurchased.
(c) Senior Subordinated Noteholders electing to have a Senior
Subordinated Note repurchased shall be required to surrender the Senior
Subordinated Note, with an appropriate form duly completed, to the Company at
the address specified in the notice at least three Business Days prior to the
repurchase date. Senior Subordinated Noteholders shall be entitled to withdraw
their election if the Senior Subordinated Notes Trustee or the Company receives
not later than one Business Day prior to the repurchase date a telegram, telex,
facsimile transmission or letter setting forth the name of the Senior
Subordinated Noteholder, the principal amount of the Senior Subordinated Note
which was delivered for repurchase by the Senior Subordinated Noteholder and a
statement that such Senior Subordinated Noteholder is withdrawing his election
to have such Senior Subordinated Note repurchased.
(d) On the repurchase date, all Senior Subordinated Notes
repurchased by the Company under this Section shall be delivered to the Senior
Subordinated Notes Trustee for cancelation, and the Company shall pay the
purchase price plus accrued and unpaid interest and liquidated damages, if any,
to the Senior Subordinated Noteholders entitled thereto.
(e) Notwithstanding the foregoing provisions of this Section, the
Company will not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in Section
4.08(b) applicable to a Change of Control Offer made by the Company and
purchases all Senior Subordinated Notes validly tendered and not withdrawn under
such Change of Control Offer.
(f) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Senior Subordinated Notes
pursuant to this Section. To the extent that the provisions of any securities
laws or regulations
45
conflict with provisions of this Section, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue thereof.
SECTION 4.09. Compliance Certificate. The Company shall deliver to
the Senior Subordinated Notes Trustee within 120 days after the end of each
fiscal year of the Company an Officers' Certificate stating that a review of the
Company's activities during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Company has kept, observed, performed and fulfilled its obligations under this
Indenture and further stating, as to each such Officer signing such certificate,
whether to the best of such Officer's knowledge the Company during such
preceding fiscal year has kept, observed, performed and fulfilled each and every
such covenant contained in this Indenture and that in the course of the
performance by the signers of their duties as Officers of the Company they would
normally have knowledge of any Default and whether or not the signers know of
any Default that occurred during such period. If they do know of any Default,
the certificate shall describe the Default, its status and what action the
Company is taking or proposes to take with respect thereto. The Company also
shall comply with Section 314(a)(4) of the TIA.
SECTION 4.10. Further Instruments and Acts. Upon request of the
Senior Subordinated Notes Trustee, the Company shall execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purpose of this Indenture.
SECTION 4.11. Limitation on the Sale or Issuance of Capital Stock of
Restricted Subsidiaries. The Company shall not sell or otherwise dispose of any
shares of Capital Stock of a Restricted Subsidiary, and shall not permit any
Restricted Subsidiary, directly or indirectly, to issue or sell or otherwise
dispose of any shares of its Capital Stock except: (i) to the Company or a
Wholly Owned Subsidiary or to any director of a Restricted Subsidiary to the
extent required as director's qualifying shares; (ii) if, immediately after
giving effect to such issuance, sale or other disposition, neither the Company
nor any of its Subsidiaries own any Capital Stock of such Restricted Subsidiary
or (iii) if, immediately after giving effect to such issuance or sale, such
Restricted Subsidiary would no longer constitute a Restricted Subsidiary and any
Investment in such Person remaining after giving effect thereto would have been
permitted to be made under Section 4.04 if made on the date of such issuance,
sale or other disposition. The provisions of this Section 4.11 shall not
prohibit any transaction effected as part of a Qualified Receivables
Transaction. The proceeds of any sale of such Capital Stock permitted hereby
shall be treated as Net Available Cash from an Asset Disposition and shall be
applied in accordance with Section 4.06.
SECTION 4.12. Limitation on Liens. The Company shall not, and shall
not permit any Restricted Subsidiary to, directly or indirectly, Incur or permit
to exist any Lien of any nature whatsoever that secures Senior Subordinated
Indebtedness of the Company or Subordinated Obligations of the Company on any of
its property or assets (including Capital Stock of a Restricted Subsidiary),
whether owned at the Closing Date or thereafter acquired, other than Permitted
Liens, without effectively providing that the Senior Subordinated Notes shall be
secured equally and ratably with (or on a senior basis to in the case of
Subordinated Obligations of the Company) the obligations so secured for so long
as such obligations are so secured.
46
ARTICLE 5
Successor Company
SECTION 5.01. When Company May Merge or Transfer Assets. The Company
shall not consolidate with or merge with or into, or convey, transfer or lease
all or substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the "Successor
Company") shall be a corporation organized and existing under the laws of
the United States of America, any State thereof or the District of
Columbia and the Successor Company (if not the Company) shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Senior Subordinated Notes Trustee, in form satisfactory to the Senior
Subordinated Notes Trustee, all the obligations of the Company under the
Senior Subordinated Notes and this Indenture;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor
Company or any Restricted Subsidiary as a result of such transaction as
having been Incurred by the Successor Company or such Restricted
Subsidiary at the time of such transac tion), no Default shall have
occurred and be continuing;
(iii) immediately after giving effect to such transaction, (A) the
Successor Company would be able to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a) or (B) the Consolidated Coverage
Ratio for the Successor Company and its Restricted Subsidiaries would be
greater than such ratio for the Company and its Restricted Subsidiaries
immediately prior to such transaction;
(iv) immediately after giving effect to such transaction, the
Successor Company shall have Consolidated Net Worth in an amount which is
not less than the Consolidated Net Worth of the Company immediately prior
to such transaction; and
(v) the Company shall have delivered to the Senior Subordinated
Notes Trustee an Officers' Certificate and an Opinion of Counsel, each
stating that such consolidation, merger or transfer and such supplemental
indenture (if any) comply with this Indenture.
The Successor Company shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under this Indenture, but the
predecessor Company in the case of a conveyance, transfer or lease of all or
substantially all its assets shall not be released from the obligation to pay
the principal of and interest on the Senior Subordinated Notes.
Notwithstanding clause (iii) above, a Wholly Owned Subsidiary may be
consolidated with or merged into the Company and the Company may consolidate
with or merge with or into (A) another Person, if such Person is a single
purpose corporation that has not conducted any business or Incurred any
Indebtedness or other liabilities and such transaction is being consummated
solely to change the state of incorporation of the
47
Company and (B) Holdings; provided, however, that, in the case of clause (B),
(x) Holdings shall not have owned any assets other than the Capital Stock of the
Company (and other immaterial assets incidental to its ownership of such Capital
Stock) or conducted any business other than owning the Capital Stock of the
Company, (y) Holdings shall not have any Indebtedness or other liabilities
(other than ordinary course liabilities incidental to its ownership of the
Capital Stock of the Company) and (z) immediately after giving effect to such
consolidation or merger, the Successor Company shall have a pro forma
Consolidated Coverage Ratio that is not less than the Consolidated Coverage
Ratio of the Company immediately prior to such consolidation or merger.
ARTICLE 6
Defaults and Remedies
SECTION 6.01. Events of Default. An "Event of Default" occurs if:
(1) the Company defaults in any payment of interest on any Senior
Subordinated Note when the same becomes due and payable, whether or not
such payment shall be prohibited by Article 10, and such default continues
for a period of 30 days;
(2) the Company (i) defaults in the payment of the principal of any
Senior Subordinated Note when the same becomes due and payable at its
Stated Maturity, upon redemption, upon declaration or otherwise, whether
or not such payment shall be prohibited by Article 10 or (ii) fails to
redeem or purchase Senior Subordinated Notes when required pursuant to
this Indenture or the Senior Subordinated Notes, whether or not such
redemption or purchase shall be prohibited by Article 10;
(3) the Company fails to comply with Section 5.01;
(4) the Company fails to comply with Section 4.02, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.11 or 4.12 (other than a failure to purchase Senior
Subordinated Notes when required under Section 4.06 or 4.08) and such
failure continues for 30 days after the notice specified below;
(5) the Company fails to comply with any of its agreements in the
Senior Subordinated Notes or this Indenture (other than those referred to
in (1), (2), (3) or (4) above) and such failure continues for 60 days
after the notice specified below;
(6) Indebtedness of the Company or any Significant Subsidiary is not
paid within any applicable grace period after final maturity or the
acceleration of any such Indebtedness by the holders thereof because of a
default and the total amount of such Indebtedness unpaid or accelerated
exceeds $25 million or its foreign currency equivalent at the time and
such failure continues for 10 days after the notice specified below;
48
(7) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in
an involuntary case;
(C) consents to the appointment of a Custodian of it or for
any substantial part of its property; or
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days; or
(9) any judgment or decree for the payment of money in excess of $25
million or its foreign currency equivalent at the time is entered against
the Company or any Significant Subsidiary and is not discharged, waived or
stayed and either (A) an enforcement proceeding has been commenced by any
creditor upon such judgment or decree or (B) there is a period of 60 days
following the entry of such judgment or decree during which such judgment
or decree is not discharged, waived or the execution thereof stayed and
such judgment or decree is not discharged, waived or the execution thereof
stayed within 10 days after the notice specified below.
The foregoing shall constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
49
A Default under clause (4), (5), (6) or (9) above is not an Event of
Default until the Senior Subordinated Notes Trustee or the Senior Subordinated
Noteholders of at least 25% in principal amount of the outstanding Senior
Subordinated Notes notify the Company of the Default and the Company does not
cure such Default within the time specified after receipt of such notice. Such
notice must specify the Default, demand that it be remedied and state that such
notice is a "Notice of Default".
The Company shall deliver to the Senior Subordinated Notes Trustee,
within 30 days after the occurrence thereof, written notice in the form of an
Officers' Certificate of any event which with the giving of notice or the lapse
of time would become an Event of Default under clause (4), (5) or (9), its
status and what action the Company is taking or proposes to take with respect
thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than an
Event of Default specified in Section 6.01(7) or (8) with respect to the
Company) occurs and is continuing, the Senior Subordinated Notes Trustee by
notice to the Company, or the Senior Subordinated Noteholders of at least 25% in
principal amount of the outstanding Senior Subordinated Notes by notice to the
Company, may declare the principal of and accrued but unpaid interest on all the
Senior Subordinated Notes to be due and payable. Upon such a declaration, such
principal and interest shall be due and payable immediately. If an Event of
Default specified in Section 6.01(7) or (8) with respect to the Company occurs,
the principal of and interest on all the Senior Subordinated Notes shall ipso
facto become and be immediately due and payable without any declaration or other
act on the part of the Senior Subordinated Notes Trustee or any Senior
Subordinated Noteholders. The Senior Subordinated Noteholders of a majority in
principal amount of the Senior Subordinated Notes by notice to the Senior
Subordinated Notes Trustee may rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of acceleration. No
such rescission shall affect any subsequent Default or impair any right
consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Senior Subordinated Notes Trustee may pursue any available
remedy to collect the payment of principal of or interest on the Senior
Subordinated Notes or to enforce the performance of any provision of the Senior
Subordinated Notes or this Indenture.
The Senior Subordinated Notes Trustee may maintain a proceeding even
if it does not possess any of the Senior Subordinated Notes or does not produce
any of them in the proceeding. A delay or omission by the Senior Subordinated
Notes Trustee or any Senior Subordinated Noteholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Senior Subordinated Notes by notice to the Senior
Subordinated Notes Trustee may waive an existing Default and its consequences
except (i) a Default in the payment of the principal of or interest on a Senior
Subordinated Note, (ii) a Default arising from the failure to redeem or purchase
any Senior Subordinated Note when
50
required pursuant to the terms of this Indenture or (iii) a Default in respect
of a provision that under Section 9.02 cannot be amended without the consent of
each Senior Subordinated Noteholder affected. When a Default is waived, it is
deemed cured, but no such waiver shall extend to any subsequent or other Default
or impair any consequent right.
SECTION 6.05. Control by Majority. The Senior Subordinated
Noteholders of a majority in principal amount of the Senior Subordinated Notes
may direct the time, method and place of conducting any proceeding for any
remedy available to the Senior Subordinated Notes Trustee or of exercising any
trust or power conferred on the Senior Subordinated Notes Trustee. However, the
Senior Subordinated Notes Trustee may refuse to follow any direction that
conflicts with law or this Indenture or, subject to Section 7.01, that the
Senior Subordinated Notes Trustee determines is unduly prejudicial to the rights
of other Senior Subordinated Noteholders or would involve the Senior
Subordinated Notes Trustee in personal liability; provided, however, that the
Senior Subordinated Notes Trustee may take any other action deemed proper by the
Senior Subordinated Notes Trustee that is not inconsistent with such direction.
Prior to taking any action hereunder, the Senior Subordinated Notes Trustee
shall be entitled to indemnification satisfactory to it in its sole discretion
against all losses and expenses caused by taking or not taking such action.
SECTION 6.06. Limitation on Suits. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Senior
Subordinated Noteholder may pursue any remedy with respect to this Indenture or
the Senior Subordinated Notes unless:
(1) the Senior Subordinated Noteholder gives to the Senior
Subordinated Notes Trustee written notice stating that an Event of Default
is continuing;
(2) the Senior Subordinated Noteholders of at least 25% in principal
amount of the Senior Subordinated Notes make a written request to the
Senior Subordinated Notes Trustee to pursue the remedy;
(3) such Senior Subordinated Noteholder or Senior Subordinated
Noteholders offer to the Senior Subordinated Notes Trustee reasonable
security or indemnity against any loss, liability or expense;
(4) the Senior Subordinated Notes Trustee does not comply with the
request within 60 days after receipt of the request and the offer of
security or indemnity; and
(5) the Senior Subordinated Noteholders of a majority in principal
amount of the Senior Subordinated Notes do not give the Senior
Subordinated Notes Trustee a direction inconsistent with the request
during such 60-day period.
A Senior Subordinated Noteholder may not use this Indenture to
prejudice the rights of another Senior Subordinated Noteholder or to obtain a
preference or priority over another Senior Subordinated Noteholder.
SECTION 6.07. Rights of Senior Subordinated Noteholders to Receive
Payment. Notwithstanding any other provision of this Indenture, the right of any
Senior
51
Subordinated Noteholder to receive payment of principal of and liquidated
damages and interest on the Senior Subordinated Notes held by such Senior
Subordinated Noteholder, on or after the respective due dates expressed in the
Senior Subordinated Notes, 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 Senior Subordinated Noteholder.
SECTION 6.08. Collection Suit by Senior Subordinated Notes Trustee.
If an Event of Default specified in Section 6.01(1) or (2) occurs and is
continuing, the Senior Subordinated Notes Trustee may recover judgment in its
own name and as trustee of an express trust against the Company for the whole
amount then due and owing (together with interest on any unpaid interest to the
extent lawful) and the amounts provided for in Section 7.07.
SECTION 6.09. Senior Subordinated Notes Trustee May File Proofs of
Claim. The Senior Subordinated Notes 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 Senior Subordinated Notes Trustee and the Senior Subordinated
Noteholders allowed in any judicial proceedings relative to the Company,
Holdings, their creditors or their property and, unless prohibited by law or
applicable regulations, may vote on behalf of the Senior Subordinated
Noteholders in any election of a trustee in bankruptcy or other Person
performing similar functions, and any Custodian in any such judicial proceeding
is hereby authorized by each Senior Subordinated Noteholder to make payments to
the Senior Subordinated Notes Trustee and, in the event that the Senior
Subordinated Notes Trustee shall consent to the making of such payments directly
to the Senior Subordinated Noteholders, to pay to the Senior Subordinated Notes
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Senior Subordinated Notes Trustee, its agents
and its counsel, and any other amounts due the Senior Subordinated Notes Trustee
under Section 7.07.
SECTION 6.10. Priorities. If the Senior Subordinated Notes Trustee
col lects any money or property pursuant to this Article 6, it shall pay out the
money or property in the following order:
FIRST: to the Senior Subordinated Notes Trustee for amounts due
under Section 7.07;
SECOND: to holders of Senior Indebtedness of the Company to the
extent required by Article 10;
THIRD: to Senior Subordinated Noteholders for amounts due and unpaid
on the Senior Subordinated Notes for principal and interest, ratably, and
any liquidated damages without preference or priority of any kind,
according to the amounts due and payable on the Senior Subordinated Notes
for principal, any liquidated damages and interest, respectively; and
FOURTH: to the Company.
The Senior Subordinated Notes Trustee may fix a record date and
payment date for any payment to Senior Subordinated Noteholders pursuant to this
Section. At least 15 days before such record date, the Senior Subordinated Notes
Trustee
52
shall mail to each Senior Subordinated Noteholder and the Company a notice that
states the record date, the payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Senior
Subordinated Notes Trustee for any action taken or omitted by it as Senior
Subordinated Notes Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section does not apply to a suit by the Senior Subordinated Notes
Trustee, a suit by a Senior Subordinated Noteholder pursuant to Section 6.07 or
a suit by Senior Subordinated Noteholders of more than 10% in principal amount
of the Senior Subordinated Notes.
SECTION 6.12. Waiver of Stay or Extension Laws. Neither the Company
nor Holdings (to the extent it may lawfully do so) shall at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company and Holdings (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and shall
not hinder, delay or impede the execution of any power herein granted to the
Senior Subordinated Notes Trustee, but shall suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE 7
Senior Subordinated Notes Trustee
SECTION 7.01. Duties of Senior Subordinated Notes Trustee. (a) If an
Event of Default has occurred and is continuing, the Senior Subordinated Notes
Trustee shall exercise the rights and powers vested in it by this Indenture and
use the same degree of care and skill in their exercise as a prudent Person
would exercise or use under the circumstances in the conduct of such Person's
own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Senior Subordinated Notes Trustee need only perform such
duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Senior Subordinated Notes Trustee; and
(2) in the absence of bad faith on its part, the Senior Subordinated
Notes Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Senior Subordinated Notes Trustee and conforming
to the requirements of this Indenture. However, the Senior Subordinated
Notes Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
53
(c) The Senior Subordinated Notes Trustee may not be relieved from
liability for its own negligent action, its own negligent failure to act or its
own wilful misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of
this Section;
(2) the Senior Subordinated Notes Trustee shall not be liable for
any error of judgment made in good faith by a Trust Officer unless it is
proved that the Senior Subordinated Notes Trustee was negligent in
ascertaining the pertinent facts; and
(3) the Senior Subordinated Notes Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the
Senior Subordinated Notes Trustee is subject to paragraphs (a), (b) and (c) of
this Section.
(e) The Senior Subordinated Notes Trustee shall not be liable for
interest on any money received by it except as the Senior Subordinated Notes
Trustee may agree in writing with the Company.
(f) Money held in trust by the Senior Subordinated Notes Trustee
need not be segregated from other funds except to the extent required by law.
(g) No provision of this Indenture shall require the Senior
Subordinated Notes Trustee to expend or risk its own funds or otherwise incur
financial liability in the performance of any of its duties hereunder or in the
exercise of any of its rights or powers, if it shall have reasonable grounds to
believe that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Senior Subordinated
Notes Trustee shall be subject to the provisions of this Section and to the
provisions of the TIA.
SECTION 7.02. Rights of Senior Subordinated Notes Trustee. (a) The
Senior Subordinated Notes Trustee may rely on any document believed by it to be
genu ine and to have been signed or presented by the proper person. The Senior
Subordinated Notes Trustee need not investigate any fact or matter stated in the
document.
(b) Before the Senior Subordinated Notes Trustee acts or refrains
from acting, it may require an Officers' Certificate or an Opinion of Counsel.
The Senior Subordinated Notes Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on the Officers' Certificate or
Opinion of Counsel.
(c) The Senior Subordinated Notes Trustee may act through agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
54
(d) The Senior Subordinated Notes Trustee shall not be liable for
any action it takes or omits to take in good faith which it believes to be
authorized or within its rights or powers.
(e) The Senior Subordinated Notes Trustee may consult with counsel,
and the advice or opinion of counsel with respect to legal matters relating to
this Indenture and the Senior Subordinated Notes shall be full and complete
authorization and protection from liability in respect to any action taken,
omitted or suffered by it here under in good faith and in accordance with the
advice or opinion of such counsel.
(f) The Senior Subordinated Notes Trustee shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval, bond, debenture, note or other paper or document, but the
Senior Subordinated Notes Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit.
(g) The Senior Subordinated Notes 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 Senior Subordinated
Noteholders pursuant to the provisions of this Indenture, unless such Senior
Subordinated Noteholders shall have offered to the Senior Subordinated Notes
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby.
SECTION 7.03. Individual Rights of Senior Subordinated Notes
Trustee. The Senior Subordinated Notes Trustee in its individual or any other
capacity may become the owner or pledgee of Senior Subordinated Notes and may
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not Senior Subordinated Notes Trustee. Any Paying Agent,
Registrar or co-paying agent may do the same with like rights. However, the
Senior Subordinated Notes Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Senior Subordinated Notes Trustee's Disclaimer. The
Senior Subordinated Notes Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Senior
Subordinated Notes, it shall not be accountable for the Company's use of the
proceeds from the Senior Subordinated Notes, and it shall not be responsible for
any statement of the Company in this Indenture or in any document issued in
connection with the sale of the Senior Subordinated Notes or in the Senior
Subordinated Notes other than the Senior Subordinated Notes Trustee's
certificate of authentication.
SECTION 7.05. Notice of Defaults. (a) The Senior Subordinated Notes
Trustee shall not be deemed to have notice of any Default, other than a payment
default, unless a Trust Officer shall have been advised in writing that a
Default has occurred. No duty imposed upon the Senior Subordinated Notes Trustee
in this Indenture shall be applicable with respect to any Default of which the
Trustee is not deemed to have notice.
(b) If a Default occurs and is continuing and if it is known to the
Senior Subordinated Notes Trustee, the Senior Subordinated Notes Trustee shall
mail to each Senior Subordinated Noteholder notice of the Default within the
earlier of 90 days after it occurs or 30 days after it is known to a Trust
Officer or written notice of it is received by the Senior Subordinated Notes
Trustee. Except in the case of a Default in payment of
55
principal, premium (if any) or interest on any Senior Subordinated Note
(including payments pursuant to the redemption provisions of such Senior
Subordinated Note), the Senior Subordinated Notes Trustee may withhold notice if
and so long as a committee of its Trust Officers in good faith determines that
withholding notice is in the interests of the Senior Subordinated Noteholders.
SECTION 7.06. Reports by Senior Subordinated Notes Trustee to Senior
Subordinated Noteholders. As promptly as practicable after each June 30
beginning with the June 30 following the first anniversary of the date of this
Indenture, and in any event prior to August 31 in each subsequent year, the
Senior Subordinated Notes Trustee shall, to the extent that any of the events
described in TIA ss. 313(a) occurred within the previous twelve months, but not
otherwise, mail to each Senior Subordinated Noteholder a brief report dated as
of June 30 that complies with Section 313(a) of the TIA. The Senior Subordinated
Notes Trustee shall also comply with Section 313(b) of the TIA.
A copy of each report at the time of its mailing to Senior
Subordinated Noteholders shall be filed with the SEC and each stock exchange (if
any) on which the Senior Subordinated Notes are listed. The Company agrees to
notify promptly the Senior Subordinated Notes Trustee whenever the Senior
Subordinated Notes become listed on any stock exchange and of any delisting
thereof.
SECTION 7.07. Compensation and Indemnity. The Company shall pay to
the Senior Subordinated Notes Trustee from time to time such compensation as the
Company and the Senior Subordinated Notes Trustee shall from time to time agree
in writing. The Senior Subordinated Notes Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Company
shall reimburse the Senior Subordinated Notes Trustee upon request for all
reasonable out-of-pocket expenses incurred or made by it, including costs of
collection, in addition to the compensation for its services. Such expenses
shall include the reasonable compensation and expenses, disbursements and
advances of the Senior Subordinated Notes Trustee's agents, counsel, accountants
and experts. The Company and Holdings, jointly and severally shall indemnify the
Senior Subordinated Notes Trustee, and hold it harmless, against any and all
loss, liability or expense (including reasonable attorneys' fees) incurred by or
in connection with the offer and sale of the Senior Subordinated Notes or the
administration of this trust and the performance of its duties hereunder. The
Senior Subordinated Notes Trustee shall notify the Company of any claim for
which it may seek indemnity promptly upon obtaining actual knowledge thereof;
provided, however, that any failure so to notify the Company shall not relieve
the Company or Holdings of its indemnity obligations hereunder. The Company
shall defend the claim and the indemnified party shall provide reasonable
cooperation at the Company's expense in the defense. Such indemnified parties
may have separate counsel and the Company and Holdings, as applicable, shall pay
the fees and expenses of such counsel; provided, however, that the Company shall
not be required to pay such fees and expenses if it assumes such indemnified
parties' defense and, in such indemnified parties' reasonable judgment, there is
no conflict of interest between the Company and Holdings, as applicable, and
such parties in connection with such defense. The Company need not reimburse any
expense or indemnify against any loss, liability or expense incurred by an
indemnified party through such party's own wilful misconduct and negligence.
To secure the Company's payment obligations in this Section, the
Senior Subordinated Notes Trustee shall have a lien prior to the Senior
Subordinated Notes on
56
all money or property held or collected by the Senior Subordinated Notes Trustee
other than money or property held in trust to pay principal of and interest and
any liquidated damages on particular Senior Subordinated Notes.
The Company's payment obligations pursuant to this Section shall
survive the satisfaction or discharge of this Indenture, any rejection or
termination of this Indenture under any bankruptcy law or the resignation or
removal of the Senior Subordinated Notes Trustee. When the Senior Subordinated
Notes Trustee incurs expenses after the occurrence of a Default specified in
Section 6.01(7) or (8) with respect to the Company, the expenses are intended to
constitute expenses of administration under the Bankruptcy Law.
SECTION 7.08. Replacement of Senior Subordinated Notes Trustee. The
Senior Subordinated Notes Trustee may resign at any time by so notifying the
Company. The Holders of a majority in principal amount of the Senior
Subordinated Notes may remove the Senior Subordinated Notes Trustee by so
notifying the Senior Subordinated Notes Trustee and may appoint a successor
Senior Subordinated Notes Trustee. The Company shall remove the Senior
Subordinated Notes Trustee if:
(1) the Senior Subordinated Notes Trustee fails to comply with
Section 7.10;
(2) the Senior Subordinated Notes Trustee is adjudged bankrupt or
insol vent;
(3) a receiver or other public officer takes charge of the Senior
Subordinated Notes Trustee or its property; or
(4) the Senior Subordinated Notes Trustee otherwise becomes
incapable of acting.
If the Senior Subordinated Notes Trustee resigns, is removed by the
Company or by the Holders of a majority in principal amount of the Senior
Subordinated Notes and such Senior Subordinated Noteholders do not reasonably
promptly appoint a successor Senior Subordinated Notes Trustee, or if a vacancy
exists in the office of Senior Subordinated Notes Trustee for any reason (the
Senior Subordinated Notes Trustee in such event being referred to herein as the
retiring Senior Subordinated Notes Trustee), the Company shall promptly appoint
a successor Senior Subordinated Notes Trustee.
A successor Senior Subordinated Notes Trustee shall deliver a
written acceptance of its appointment to the retiring Senior Subordinated Notes
Trustee and to the Company. Thereupon the resignation or removal of the retiring
Senior Subordinated Notes Trustee shall become effective, and the successor
Senior Subordinated Notes Trustee shall have all the rights, powers and duties
of the Senior Subordinated Notes Trustee under this Indenture. The successor
Senior Subordinated Notes Trustee shall mail a notice of its succession to
Senior Subordinated Noteholders. The retiring Senior Subordinated Notes Trustee
shall promptly transfer all property held by it as Senior Subordinated Notes
Trustee to the successor Senior Subordinated Notes Trustee, subject to the lien
provided for in Section 7.07.
57
If a successor Senior Subordinated Notes Trustee does not take
office within 60 days after the retiring Senior Subordinated Notes Trustee
resigns or is removed, the retiring Senior Subordinated Notes Trustee or the
Holders of 10% in principal amount of the Senior Subordinated Notes may petition
any court of competent jurisdiction for the appointment of a successor Senior
Subordinated Notes Trustee.
If the Senior Subordinated Notes Trustee fails to comply with
Section 7.10, any Senior Subordinated Noteholder may petition any court of
competent jurisdiction for the removal of the Senior Subordinated Notes Trustee
and the appoint ment of a successor Senior Subordinated Notes Trustee.
Notwithstanding the replacement of the Senior Subordinated Notes
Trustee pursuant to this Section, the Company's obligations under Section 7.07
shall continue for the benefit of the retiring Senior Subordinated Notes
Trustee.
SECTION 7.09. Successor Senior Subordinated Notes Trustee by Merger.
If the Senior Subordinated Notes Trustee consolidates with, merges or converts
into, or transfers all or substantially all its corporate trust business or
assets to, another corporation or banking association, the resulting, surviving
or transferee corporation without any further act shall be the successor Senior
Subordinated Notes Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Senior Subordinated Notes Trustee shall
succeed to the trusts created by this Indenture any of the Senior Subordinated
Notes shall have been authenticated but not delivered, any such successor to the
Senior Subordinated Notes Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Senior Subordinated Notes so
authenticated; and in case at that time any of the Senior Subordinated Notes
shall not have been authenticated, any successor to the Senior Subordinated
Notes Trustee may authenticate such Senior Subordinated Notes either in the name
of any predecessor hereunder or in the name of the successor to the Senior
Subordinated Notes Trustee; and in all such cases such certificates shall have
the full force which it is anywhere in the Senior Subordinated Notes or in this
Indenture provided that the certificate of the Senior Subordinated Notes Trustee
shall have.
SECTION 7.10. Eligibility; Disqualification. The Senior Subordinated
Notes Trustee shall at all times satisfy the requirements of TIA ss. 310(a). The
Senior Subordinated Notes Trustee 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. The Senior Subordinated Notes Trustee shall comply with TIA ss.
310(b); provided, however, that there shall be excluded from the operation of
TIA ss. 310(b)(1) any indenture or indentures under which other securities or
certificates of interest or participation in other securities of the Company are
outstanding if the requirements for such exclusion set forth in TIA ss.
310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company. The
Senior Subordinated Notes Trustee shall comply with TIA ss. 311(a), excluding
any creditor relationship listed in TIA ss. 311(b). A Senior Subordinated Notes
Trustee who has resigned or been removed shall be subject to TIA ss. 311(a) to
the extent indicated.
58
ARTICLE 8
Discharge of Indenture; Defeasance
SECTION 8.01. Discharge of Liability on Senior Subordinated Notes;
Defeasance. (a) When (i) the Company delivers to the Senior Subordinated Notes
Trustee all outstanding Senior Subordinated Notes (other than Senior
Subordinated Notes replaced pursuant to Section 2.08) for cancelation or (ii)
all outstanding Senior Subordinated Notes have become due and payable, whether
at maturity or as a result of the mailing of a notice of redemption pursuant to
Article 3 hereof, and the Company irrevocably deposits with the Senior
Subordinated Notes Trustee funds or U.S. Government Obligations on which payment
of principal and interest when due will be sufficient to pay at maturity or upon
redemption all outstanding Senior Subordinated Notes, including interest thereon
to maturity or such redemption date (other than Senior Subordinated Notes
replaced pursuant to Section 2.08), and if in either case the Company pays all
other sums payable hereunder by the Company, then this Indenture shall, subject
to Section 8.01(c), cease to be of further effect. The Senior Subordinated Notes
Trustee shall acknowledge satisfaction and discharge of this Indenture on demand
of the Company accompanied by an Officers' Certificate and an Opinion of Counsel
and at the cost and expense of the Company.
(b) Subject to Sections 8.01(c) and 8.02, the Company at any time
may terminate (i) all of its obligations under the Senior Subordinated Notes and
this Indenture ("legal defeasance option") or (ii) its obligations under
Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11 and 4.12 and
the operation of Section 5.01(iii), 5.01(iv), 6.01(4), 6.01(6), 6.01(7) (with
respect to Significant Subsidiaries of the Company only), 6.01(8) (with respect
to Significant Subsidiaries of the Company only) and 6.01(9) ("covenant
defeasance option"). The Company may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option. In the
event that the Company terminates all of its obligations under the Senior
Subordinated Notes and this Indenture by exercising its legal defeasance option,
the obligations under the Holdings Guarantee shall be terminated simultaneously
with the termination of such obligations.
If the Company exercises its legal defeasance option, payment of the
Senior Subordinated Notes may not be accelerated because of an Event of Default.
If the Company exercises its covenant defeasance option, payment of the Senior
Subordinated Notes may not be accelerated because of an Event of Default
specified in Section 6.01(4), 6.01(6), 6.01(7) (with respect to Significant
Subsidiaries of the Company only) or 6.01(8) (with respect to Significant
Subsidiaries of the Company only) or because of the failure of the Company to
comply with clauses (iii) and (iv) of Section 5.01.
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Senior Subordinated Notes Trustee shall acknowledge
in writing the discharge of those obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.04, 2.05, 2.06, 2.07, 2.08, 2.09, 7.07, 7.08 and in
this Article 8 shall survive until the Senior Subordinated Notes have been paid
in full. Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05
shall survive.
59
SECTION 8.02. Conditions to Defeasance. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Senior
Subordinated Notes Trustee money or U.S. Government Obligations for the
payment of principal, premium (if any) and interest on the Senior
Subordinated Notes to maturity or redemption, as the case may be;
(2) the Company delivers to the Senior Subordinated Notes Trustee a
cer tificate from a nationally recognized firm of independent accountants
expressing their opinion that the payments of principal and interest when
due and without reinvestment on the deposited U.S. Government Obligations
plus any deposited money without investment will provide cash at such
times and in such amounts as will be sufficient to pay principal and
interest when due on all the Senior Subordinated Notes to maturity or
redemption, as the case may be;
(3) 123 days pass after the deposit is made and during the 123-day
period no Default specified in Section 6.01(7) or (8) with respect to the
Company occurs which is continuing at the end of the period;
(4) the deposit does not constitute a default under any other
agreement binding on the Company and is not prohibited by Article 10;
(5) the Company delivers to the Senior Subordinated Notes Trustee an
Opinion of Counsel to the effect that the trust resulting from the deposit
does not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940;
(6) in the case of the legal defeasance option, the Company shall
have delivered to the Senior Subordinated Notes Trustee an Opinion of
Counsel stating that (i) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (ii) since the
date of this Indenture there has been a change in the applicable Federal
income tax law, in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm that, the Senior Subordinated Noteholders
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 on the same amounts, in the same manner and at the same times
as would have been the case if such deposit and defeasance had not
occurred;
(7) in the case of the covenant defeasance option, the Company shall
have delivered to the Senior Subordinated Notes Trustee an Opinion of
Counsel to the effect that the Senior Subordinated Noteholders 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
on the same amounts, in the same manner and at the same times as would
have been the case if such deposit and defeasance had not occurred; and
(8) the Company delivers to the Senior Subordinated Notes Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions
60
precedent to the defeasance and discharge of the Senior Subordinated Notes
as contemplated by this Article 8 have been complied with.
Before or after a deposit, the Company may make arrangements
satisfactory to the Senior Subordinated Notes Trustee for the redemption of
Senior Subordinated Notes at a future date in accordance with Article 3.
SECTION 8.03. Application of Trust Money. The Senior Subordinated
Notes Trustee shall hold in trust money or U.S. Government Obligations deposited
with it pursuant to this Article 8. It shall apply the deposited money and the
money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal of and interest on
the Senior Subordinated Notes. Money and securities so held in trust are not
subject to Article 10.
SECTION 8.04. Repayment to Company. The Senior Subordinated Notes
Trustee and the Paying Agent shall promptly turn over to the Company upon
request any excess money or securities held by them at any time.
Subject to any applicable abandoned property law, the Senior
Subordinated Notes Trustee and the Paying Agent shall pay to the Company upon
written request any money held by them for the payment of principal or interest
that remains unclaimed for two years, and, thereafter, Senior Subordinated
Noteholders entitled to the money must look to the Company for payment as
general creditors.
SECTION 8.05. Indemnity for Government Obligations. The Company
shall pay and shall indemnify the Senior Subordinated Notes Trustee against any
tax, fee or other charge imposed on or assessed against deposited U.S.
Government Obligations or the principal and interest received on such U.S.
Government Obligations.
SECTION 8.06. Reinstatement. If the Senior Subordinated Notes
Trustee or Paying Agent is unable to apply any money or U.S. Government
Obligations in accordance with this Article 8 by reason of any legal proceeding
or by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the Company's
obligations under this Indenture and the Senior Subordinated Notes shall be
revived and reinstated as though no deposit had occurred pursuant to this
Article 8 until such time as the Senior Subordinated Notes Trustee or Paying
Agent is permitted to apply all such money or U.S. Government Obligations in
accordance with this Article 8; provided, however, that, if the Company has made
any payment of interest on or principal of any Senior Subordinated Notes because
of the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Senior Subordinated Noteholders of such Senior Subordinated Notes
to receive such payment from the money or U.S. Government Obligations held by
the Senior Subordinated Notes Trustee or Paying Agent.
ARTICLE 9
Amendments
SECTION 9.01. Without Consent of Senior Subordinated Noteholders.
The Company, Holdings and the Senior Subordinated Notes Trustee may amend this
61
Indenture or the Senior Subordinated Notes without notice to or consent of any
Senior Subordinated Noteholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Senior Subordinated Notes in
addition to or in place of certificated Senior Subordinated Notes;
provided, however, that the uncertificated Senior Subordinated Notes are
issued in registered form for purposes of Section 163(f) of the Code or in
a manner such that the uncertificated Senior Subordinated Notes are
described in Section 163(f)(2)(B) of the Code;
(4) to make any change in Article 10 or Article 12 that would limit
or terminate the benefits available to any holder of Senior Indebtedness
(or Representatives therefor) under Article 10 or Article 12;
(5) to add additional Guarantees with respect to the Senior
Subordinated Notes or to secure the Senior Subordinated Notes;
(6) to add to the covenants of the Company for the benefit of the
Senior Subordinated Noteholders or to surrender any right or power herein
conferred upon the Company;
(7) to comply with any requirements of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the
TIA;
(8) to make any change that does not adversely affect the rights of
any Senior Subordinated Noteholder; or
(9) to provide for the issuance of the Senior Subordinated Exchange
Notes, Private Senior Subordinated Exchange Notes or Additional Senior
Subordinated Notes, which shall have terms substantially identical in all
material respects to the Original Senior Subordinated Notes (except that
the transfer restrictions contained in the Original Senior Subordinated
Notes shall be modified or eliminated, as appropriate), and which shall be
treated, together with any outstanding Original Senior Subordinated Notes,
as a single issue of securities.
An amendment under this Section may not make any change that
adversely affects the rights under Article 10 or Article 12 of any holder of
Senior Indebtedness then outstanding unless the holders of such Senior
Indebtedness (or any group or representative thereof authorized to give a
consent) consent to such change.
After an amendment under this Section becomes effective, the Company
shall mail to Senior Subordinated Noteholders a notice briefly describing such
amendment. The failure to give such notice to all Senior Subordinated
Noteholders, or any defect therein, shall not impair or affect the validity of
an amendment under this Section.
SECTION 9.02. With Consent of Senior Subordinated Noteholders. The
Company, Holdings and the Senior Subordinated Notes Trustee may amend this
62
Indenture or the Senior Subordinated Notes with the written consent of the
Holders of at least a majority in principal amount of the Senior Subordinated
Notes then outstanding (including consents obtained in connection with a tender
offer or exchange offer for the Senior Subordinated Notes), without notice to
any other Senior Subordinated Noteholder. However, without the consent of each
Holder of an outstanding Senior Subordinated Note affected, an amendment may
not:
(1) reduce the principal amount of Senior Subordinated Notes whose
Senior Subordinated Noteholders must consent to an amendment;
(2) reduce the rate of or extend the time for payment of interest or
any liquidated damages on any Senior Subordinated Note;
(3) reduce the principal of or extend the Stated Maturity of any
Senior Subordinated Note;
(4) reduce the premium payable upon the redemption of any Senior
Subordinated Note or change the time at which any Senior Subordinated Note
may be redeemed in accordance with Article 3;
(5) make any Senior Subordinated Note payable in money other than
that stated in the Senior Subordinated Note;
(6) make any change in Article 10 or Article 12 that adversely
affects the rights of any Senior Subordinated Noteholder under Article 10
or Article 12; or
(7) make any change in Section 6.04 or 6.07 or the second sentence
of this Section 9.02.
It shall not be necessary for the consent of the Senior Subordinated
Noteholders under this Section to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent approves the substance
thereof.
An amendment under this Section 9.02 may not make any change that
adversely affects the rights under Article 10 of any holder of Senior
Indebtedness of the Company then outstanding unless the holders of such Senior
Indebtedness (or any group or representative thereof authorized to give a
consent) consent to such change.
After an amendment under this Section becomes effective, the Company
shall mail to Senior Subordinated Noteholders a notice briefly describing such
amendment. The failure to give such notice to all Senior Subordinated
Noteholders, or any defect therein, shall not impair or affect the validity of
an amendment under this Section.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment
to this Indenture or the Senior Subordinated Notes shall comply with the TIA as
then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Senior Subordinated Noteholder of a
Senior Subordinated Note shall bind the Senior Subordinated Noteholder and every
subsequent
63
Senior Subordinated Noteholder of that Senior Subordinated Note or portion of
the Senior Subordinated Note that evidences the same debt as the consenting
Senior Subordinated Noteholder's Senior Subordinated Note, even if notation of
the consent or waiver is not made on the Senior Subordinated Note. However, any
such Senior Subordinated Noteholder or subsequent Senior Subordinated Noteholder
may revoke the consent or waiver as to such Senior Subordinated Noteholder's
Senior Subordinated Note or portion of the Senior Subordinated Note if the
Senior Subordinated Notes Trustee receives the notice of revocation before the
date the amendment or waiver becomes effective. After an amendment or waiver
becomes effective, it shall bind every Senior Subordinated Noteholder. An
amendment or waiver becomes effective once both (i) the requisite number of
consents have been received by the Company or the Senior Subordinated Notes
Trustee and (ii) such amendment or waiver has been executed by the Company and
the Senior Subordinated Notes Trustee.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Senior Subordinated Noteholders entitled to
give their consent or take any other action described above or required or
permitted to be taken pursuant to this Indenture. If a record date is fixed,
then notwithstanding the immediately preceding paragraph, those Persons who were
Senior Subordinated Noteholders at such record date (or their duly designated
proxies), and only those Persons, shall be entitled to give such consent or to
revoke any consent previously given or to take any such action, whether or not
such Persons continue to be Senior Subordinated Noteholders after such record
date. No such consent shall be valid or effective for more than 120 days after
such record date.
SECTION 9.05. Notation on or Exchange of Senior Subordinated Notes.
If an amendment changes the terms of a Senior Subordinated Note, the Senior
Subordinated Notes Trustee may require the Senior Subordinated Noteholder of the
Senior Subordinated Note to deliver it to the Senior Subordinated Notes Trustee.
The Senior Subordinated Notes Trustee may place an appropriate notation on the
Senior Subordinated Note regarding the changed terms and return it to the Senior
Subordinated Noteholder. Alternatively, if the Company or the Senior
Subordinated Notes Trustee so determines, the Company in exchange for the Senior
Subordinated Note shall issue and the Senior Subordinated Notes Trustee shall
authenticate a new Senior Subordinated Note that reflects the changed terms.
Failure to make the appropriate notation or to issue a new Senior Subordinated
Note shall not affect the validity of such amendment.
SECTION 9.06. Senior Subordinated Notes Trustee To Sign Amendments.
The Senior Subordinated Notes Trustee shall sign any amendment authorized
pursuant to this Article 9 if the amendment does not adversely affect the
rights, duties, liabilities or immunities of the Senior Subordinated Notes
Trustee. If it does, the Senior Subordinated Notes Trustee may but need not sign
it. In signing such amendment the Senior Subordinated Notes Trustee shall be
entitled to receive indemnity reasonably satisfactory to it and to receive, and
(subject to Section 7.01) shall be fully protected in relying upon, an Officers'
Certificate and an Opinion of Counsel stating that such amendment is authorized
or permitted by this Indenture and that such amendment is the legal, valid and
binding obligation of the Company and Holdings enforceable against them in
accordance with its terms, subject to customary exceptions, and complies with
the provisions hereof (including Section 9.03).
64
ARTICLE 10
Subordination
SECTION 10.01. Agreement To Subordinate. The Company agrees, and
each Senior Subordinated Noteholder by accepting a Senior Subordinated Note
agrees, that the Indebtedness evidenced by the Senior Subordinated Notes is
subordinated in right of payment, to the extent and in the manner provided in
this Article 10, to the prior payment in full in cash or cash equivalents of all
Senior Indebtedness of the Company and that the subordination is for the benefit
of and enforceable by the holders of such Senior Indebtedness. The Senior
Subordinated Notes shall in all respects rank pari passu with all other Senior
Subordinated Indebtedness of the Company and only Indebtedness of the Company
that is Senior Indebtedness of the Company shall rank senior to the Senior
Subordinated Notes in accordance with the provisions set forth herein. For
purposes of this Article 10, the Indebtedness evidenced by the Senior
Subordinated Notes shall be deemed to include the liquidated damages payable
pursuant to the provisions set forth in the Senior Subordinated Notes and the
Senior Subordinated Notes Registration Agreement. All provisions of this Article
10 shall be subject to Section 10.12.
SECTION 10.02. Liquidation, Dissolution, Bankruptcy. Upon any
payment or distribution of the assets of the Company to creditors upon a total
or partial liquidation or a total or partial dissolution of the Company or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the Company or its property:
(1) holders of Senior Indebtedness of the Company shall be entitled
to receive payment in full in cash or cash equivalents of such Senior
Indebtedness before the Senior Subordinated Noteholders shall be entitled
to receive any payment of principal of, interest, premium (if any) or
liquidated damages on the Senior Subordinated Notes; and
(2) until the Senior Indebtedness of the Company is paid in full in
cash or cash equivalents, any payment or distribution to which Senior
Subordinated Noteholders would be entitled but for this Article 10 shall
be made to holders of such Senior Indebtedness as their interests may
appear.
SECTION 10.03. Default on Senior Indebtedness. The Company may not
pay the principal of, premium (if any) or interest on the Senior Subordinated
Notes, or any liquidated damages payable pursuant to the provisions set forth in
the Senior Subordinated Notes Registration Agreement (as defined in the
Appendix), or make any deposit pursuant to Section 8.01 and may not repurchase,
redeem or otherwise retire any Senior Subordinated Notes (collectively, "pay the
Senior Subordinated Notes") if (i) any Designated Senior Indebtedness of the
Company is not paid in cash or cash equivalents when due or (ii) any other
default on Designated Senior Indebtedness of the Company occurs and the maturity
of such Designated Senior Indebtedness is accelerated in accordance with its
terms unless, in either case, (x) the default has been cured or waived and any
such acceleration has been rescinded or (y) such Designated Senior Indebtedness
has been paid in full in cash or cash equivalents; provided, however, that the
Company may pay the Senior Subordinated Notes without regard to the foregoing if
the Company and the Senior Subordinated Notes Trustee receive written notice
approving such payment from the Representative of the Designated Senior
Indebtedness with respect to
65
which either of the events set forth in clause (i) or (ii) of this sentence has
occurred and is continuing. During the continuance of any default (other than a
default described in clause (i) or (ii) of the immediately preceding sentence)
with respect to any Designated Senior Indebtedness of the Company pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, the Company may not pay the Senior
Subordinated Notes for a period (a "Payment Blockage Period") commencing upon
the receipt by the Senior Subordinated Notes Trustee (with a copy to the
Company) of written notice (a "Blockage Notice") of such default from the
Represen tative of such Designated Senior Indebtedness specifying an election to
effect a Payment Blockage Period and ending 179 days thereafter (or earlier if
such Payment Blockage Period is terminated (i) by written notice to the Senior
Subordinated Notes Trustee and the Company from the Person or Persons who gave
such Blockage Notice, (ii) by repayment in full in cash or cash equivalents of
such Designated Senior Indebtedness or (iii) because the default giving rise to
such Blockage Notice is no longer continuing). Notwithstanding the provisions
described in the immediately preceding sentence (but subject to the provisions
contained in the first sentence of this Section), unless the holders of such
Designated Senior Indebtedness or the Representative of such holders shall have
accelerated the maturity of such Designated Senior Indebtedness, the Company may
resume payments on the Senior Subordinated Notes after the end of such Payment
Blockage Period. Not more than one Blockage Notice may be given in any
consecutive 360-day period, irrespective of the number of defaults with respect
to Designated Senior Indebtedness of the Company during such period; provided,
however, that if any Blockage Notice within such 360-day period is given by or
on behalf of any holders of Designated Senior Indebtedness of the Company other
than the Bank Indebtedness, the Representative of the Bank Indebtedness may give
another Blockage Notice within such period; provided further, however, that in
no event may the total number of days during which any Payment Blockage Period
or Periods is in effect exceed 179 days in the aggregate during any
360-consecutive day period. For purposes of this Section, no default or event of
default that existed or was continuing on the date of the commencement of any
Payment Blockage Period with respect to the Designated Senior Indebtedness
initiating such Payment Blockage Period shall be, or be made, the basis of the
commencement of a subsequent Payment Blockage Period by the Representative of
such Designated Senior Indebtedness, whether or not within a period of 360
consecutive days, unless such default or event of default shall have been cured
or waived for a period of not less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of Senior Subordinated Notes.
If payment of the Senior Subordinated Notes is accelerated because of an Event
of Default, the Company or the Senior Subordinated Notes Trustee shall promptly
notify the holders of the Designated Senior Indebtedness of the Company (or
their Representative) of the acceleration. If any Designated Senior Indebtedness
of the Company is outstanding, the Company may not pay the Senior Subordinated
Notes until five Business Days after such holders or the Representative of the
Designated Senior Indebtedness receive notice of such acceleration and,
thereafter, may pay the Senior Subordinated Notes only if this Article 10
otherwise permits payment at that time.
SECTION 10.05. When Distribution Must Be Paid Over. If a
distribution is made to Senior Subordinated Noteholders that because of this
Article 10 should not have been made to them, the Senior Subordinated
Noteholders who receive
66
the distribution shall hold it in trust for holders of Senior Indebtedness of
the Company and pay it over to them as their interests may appear.
SECTION 10.06. Subrogation. After all Senior Indebtedness of the
Company is paid in full and until the Senior Subordinated Notes are paid in
full, Senior Subordinated Noteholders shall be subrogated to the rights of
holders of such Senior Indebtedness to receive distributions applicable to
Senior Indebtedness. A distribution made under this Article 10 to holders of
such Senior Indebtedness which otherwise would have been made to Senior
Subordinated Noteholders is not, as between the Company and Senior Subordinated
Noteholders, a payment by the Company on such Senior Indebtedness.
SECTION 10.07. Relative Rights. This Article 10 defines the relative
rights of Senior Subordinated Noteholders and holders of Senior Indebtedness of
the Company. Nothing in this Indenture shall:
(1) impair, as between the Company and Senior Subordinated
Noteholders, the obligation of the Company, which is absolute and
unconditional, to pay principal of and interest on and liquidated damages
in respect of, the Senior Subordinated Notes in accordance with their
terms; or
(2) prevent the Senior Subordinated Notes Trustee or any Senior
Subordinated Noteholder from exercising its available remedies upon a
Default, subject to the rights of holders of Senior Indebtedness of the
Company to receive distributions otherwise payable to Senior Subordinated
Noteholders.
SECTION 10.08. Subordination May Not Be Impaired by the Company. No
right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Senior Subordinated Notes
shall be impaired by any act or failure to act by the Company or by its failure
to comply with this Indenture.
SECTION 10.09. Rights of Senior Subordinated Notes Trustee and
Paying Agent. Notwithstanding Section 10.03, the Senior Subordinated Notes
Trustee or Paying Agent may continue to make payments on the Senior Subordinated
Notes and shall not be charged with knowledge of the existence of facts that
would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Trust Officer of the Senior
Subordinated Notes Trustee receives notice satisfactory to it that payments may
not be made under this Article 10. The Company, the Registrar, the Paying Agent,
a Representative or a holder of Senior Indebtedness of the Company may give the
notice; provided, however, that, if an issue of Senior Indebtedness of the
Company has a Representative, only the Representative may give the notice.
The Senior Subordinated Notes Trustee in its individual or any other
capa city may hold Senior Indebtedness of the Company with the same rights it
would have if it were not Senior Subordinated Notes Trustee. The Registrar and
the Paying Agent may do the same with like rights. The Senior Subordinated Notes
Trustee shall be entitled to all the rights set forth in this Article 10 with
respect to any Senior Indebtedness of the Company which may at any time be held
by it, to the same extent as any other holder of such Senior Indebtedness; and
nothing in Article 7 shall deprive the Senior Subordinated
67
Notes Trustee of any of its rights as such holder. Nothing in this Article 10
shall apply to claims of, or payments to, the Senior Subordinated Notes Trustee
under or pursuant to Section 7.07.
SECTION 10.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of the Company, the distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit
Right To Accelerate. The failure to make a payment pursuant to the Senior
Subordinated Notes by reason of any provision in this Article 10 shall not be
construed as preventing the occurrence of a Default. Nothing in this Article 10
shall have any effect on the right of the Senior Subordinated Noteholders or the
Senior Subordinated Notes Trustee to accelerate the maturity of the Senior
Subordinated Notes.
SECTION 10.12. Trust Moneys Not Subordinated. Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article 8 by the Senior
Subordinated Notes Trustee for the payment of principal of and interest on the
Senior Subordinated Notes shall not be subordinated to the prior payment of any
Senior Indebtedness of the Company or subject to the restrictions set forth in
this Article 10, and none of the Senior Subordinated Noteholders shall be
obligated to pay over any such amount to the Company or any holder of Senior
Indebtedness of the Company or any other creditor of the Company.
SECTION 10.13. Senior Subordinated Notes Trustee Entitled To Rely.
Upon any payment or distribution pursuant to this Article 10, the Senior
Subordinated Notes Trustee and the Senior Subordinated Noteholders shall be
entitled to rely (i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 10.02
are pending, (ii) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Senior Subordinated
Notes Trustee or to the Senior Subordinated Noteholders or (iii) upon the
Representatives for the holders of Senior Indebtedness of the Company for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of such Senior Indebtedness and other Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article
10. In the event that the Senior Subordinated Notes Trustee determines, in good
faith, that evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness of the Company to participate in any payment or
distribution pursuant to this Article 10, the Senior Subordinated Notes Trustee
may request such Person to furnish evidence to the reasonable satisfaction of
the Senior Subordinated Notes Trustee as to the amount of such Senior
Indebtedness held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and other facts pertinent to the
rights of such Person under this Article 10, and, if such evidence is not
furnished, the Senior Subordinated Notes Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment. The provisions of Sections 7.01 and 7.02 shall be applicable to
all actions or omissions of actions by the Senior Subordinated Notes Trustee
pursuant to this Article 10.
68
SECTION 10.14. Senior Subordinated Notes Trustee To Effectuate
Subordination. Each Senior Subordinated Noteholder by accepting a Senior
Subordinated Note authorizes and directs the Senior Subordinated Notes Trustee
on his or her behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the Senior Subordinated
Noteholders and the holders of Senior Indebtedness of the Company as provided in
this Article 10 and appoints the Senior Subordinated Notes Trustee as
attorney-in-fact for any and all such purposes.
SECTION 10.15. Senior Subordinated Notes Trustee Not Fiduciary for
Holders of Senior Indebtedness. The Senior Subordinated Notes Trustee shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness of the
Company and shall not be liable to any such holders if it shall mistakenly pay
over or distribute to Senior Subordinated Noteholders or the Company or any
other Person, money or assets to which any holders of Senior Indebtedness of the
Company shall be entitled by virtue of this Article 10 or otherwise.
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions. Each Senior Subordinated Noteholder by accepting a
Senior Subordinated Note acknowledges and agrees that the foregoing
subordination provisions are, and are intended to be, an inducement and a
consideration to each holder of any Senior Indebtedness of the Company, whether
such Senior Indebtedness was created or acquired before or after the issuance of
the Senior Subordinated Notes, to acquire and continue to hold, or to continue
to hold, such Senior Indebtedness and such holder of such Senior Indebtedness
shall be deemed conclusively to have relied on such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness.
SECTION 10.17. Senior Subordinated Notes Trustee's Compensation Not
Prejudiced. Nothing in this Article shall apply to amounts due to the Senior
Subordinated Notes Trustee pursuant to other sections of this Indenture.
ARTICLE 11
Holdings Guarantee
SECTION 11.01. Holdings Guarantee. Holdings hereby unconditionally
and irrevocably guarantees, as a primary obligor and not merely as a surety, to
each Senior Subordinated Noteholder and to the Senior Subordinated Notes Trustee
and its successors and assigns (a) the full and punctual payment of principal of
and interest on and liquidated damages in respect of the Senior Subordinated
Notes when due, whether at Stated Maturity, by acceleration, by redemption or
otherwise, and all other monetary obligations of the Company under this
Indenture (including obligations to the Senior Subordinated Notes Trustee) and
the Senior Subordinated Notes and (b) the full and punctual performance within
applicable grace periods of all other obligations of the Company whether for
expenses, indemnification or otherwise under this Indenture and the Senior
Subordinated Notes (all the foregoing being hereinafter collectively called the
"Guaranteed Obligations"). Holdings further agrees that the Guaranteed
Obligations may be extended or renewed, in whole or in part, without notice or
further assent from
69
Holdings, and that Holdings shall remain bound under this Article 11
notwithstanding any extension or renewal of any Guaranteed Obligation.
Holdings waives presentation to, demand of, payment from and protest
to the Company of any of the Guaranteed Obligations and also waives notice of
protest for nonpayment. Holdings waives notice of any default under the Senior
Subordinated Notes or the Guaranteed Obligations. The obligations of Holdings
hereunder shall not be affected by (a) the failure of any Senior Subordinated
Noteholder or the Senior Subordinated Notes Trustee to assert any claim or
demand or to enforce any right or remedy against the Company or any other Person
under this Indenture, the Senior Subordinated Notes or any other agreement or
otherwise; (b) any extension or renewal of any thereof; (c) any rescission,
waiver, amendment or modification of any of the terms or provisions of this
Indenture, the Senior Subordinated Notes or any other agreement; (d) the release
of any security held by any Senior Subordinated Noteholder or the Senior
Subordinated Notes Trustee for the Guaranteed Obligations or any of them; (e)
the failure of any Senior Subordinated Noteholder or Senior Subordinated Notes
Trustee to exercise any right or remedy against any other guarantor of the
Guaranteed Obligations; or (f) any change in the ownership of Holdings, except
as provided in Section 11.02(b).
Holdings hereby waives any right to which it may be entitled to have
the assets of the Company first be used and depleted as payment of the Company's
or Holdings obligations hereunder prior to any amounts being claimed from or
paid by Holdings hereunder. Holdings hereby waives any right to which it may be
entitled to require that the Company be sued prior to an action being initiated
against Holdings.
Holdings further agrees that its Holdings Guarantee herein
constitutes a guarantee of payment, performance and compliance when due (and not
a guarantee of collection) and waives any right to require that any resort be
had by any Senior Subordinated Noteholder or the Senior Subordinated Notes
Trustee to any security held for payment of the Guaranteed Obligations.
The Holdings Guarantee is, to the extent and in the manner set forth
in Article 12, subordinated and subject in right of payment to the prior payment
in full of the principal of and premium, if any, and interest on all Senior
Indebtedness of Holdings and is made subject to such provisions of this
Indenture.
Except as expressly set forth in Sections 8.01(b) and 11.02, the
obligations of Holdings hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever or
by reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of Holdings herein shall not be discharged or impaired or otherwise
affected by the failure of any Senior Subordinated Noteholder or the Senior
Subordinated Notes Trustee to assert any claim or demand or to enforce any
remedy under this Indenture, the Senior Subordinated Notes or any other
agreement, by any waiver or modification of any thereof, by any default, failure
or delay, wilful or otherwise, in the performance of the obligations, or by any
other act or thing or omission or delay to do any other act or thing which may
or might in any manner or to any extent vary the risk of Holdings or would
otherwise operate as a discharge of Holdings as a matter of law or equity.
70
Holdings agrees that its Holdings Guarantee shall remain in full
force and effect until payment in full of all the Guaranteed Obligations.
Holdings further agrees that its Holdings Guarantee herein shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any Guaranteed Obligation is
rescinded or must otherwise be restored by any Senior Subordinated Noteholder or
the Senior Subordinated Notes Trustee upon the bankruptcy or reorganization of
the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other
right which any Senior Subordinated Noteholder or the Senior Subordinated Notes
Trustee has at law or in equity against Holdings by virtue hereof, upon the
failure of the Company to pay the principal of or interest on any Guaranteed
Obligation when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, or to perform or comply with any other
Guaranteed Obligation, Holdings hereby promises to and shall, upon receipt of
written demand by the Senior Subordinated Notes Trustee, forthwith pay, or cause
to be paid, in cash, to the Senior Subordinated Noteholders or the Senior
Subordinated Notes Trustee an amount equal to the sum of (i) the unpaid
principal amount of such Guaranteed Obligations, (ii) accrued and unpaid
interest on such Guaranteed Obligations (but only to the extent not prohibited
by law) and (iii) all other monetary obligations of the Company to the Senior
Subordinated Noteholders and the Senior Subordinated Notes Trustee.
Holdings agrees that it shall not be entitled to any right of
subrogation in relation to the Senior Subordinated Noteholders in respect of any
Guaranteed Obligations guaranteed hereby until payment in full of all Guaranteed
Obligations and all obligations to which the Guaranteed Obligations are
subordinated as provided in Article 12. Holdings further agrees that, as between
it, on the one hand, and the Senior Subordinated Noteholders and the Senior
Subordinated Notes Trustee, on the other hand, (x) the maturity of the
Guaranteed Obligations guaranteed hereby may be accelerated as provided in
Article 6 for the purposes of the Holdings Guarantee herein, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of
the Guaranteed Obligations guaranteed hereby, and (y) in the event of any
declaration of acceleration of such Guaranteed Obligations as provided in
Article 6, such Guaranteed Obligations (whether or not due and payable) shall
forthwith become due and payable by Holdings for the purposes of this Section
11.01.
Holdings also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees and expenses) incurred by the Senior
Subordinated Notes Trustee or any Senior Subordinated Noteholder in enforcing
any rights under this Section 11.01.
Upon request of the Senior Subordinated Notes Trustee, Holdings
shall execute and deliver such further instruments and do such further acts as
may be reasonably necessary or proper to carry out more effectively the purpose
of this Indenture.
SECTION 11.02. Limitation on Liability. (a) Any term or provision of
this Indenture to the contrary notwithstanding, the maximum, aggregate amount of
the Guaranteed Obligations guaranteed hereunder by Holdings shall not exceed the
maximum amount that can be hereby guaranteed without rendering this Indenture,
as it
71
relates to Holdings, voidable under applicable law relating to fraudulent
conveyance or fraudulent transfer or similar laws affecting the rights of
creditors generally.
(b) This Holdings Guarantee shall terminate and be of no further
force or effect and Holdings shall be deemed to be released from all obligations
under this Article 11 upon the merger or consolidation of Holdings with or into
any Person other than the Company or a Subsidiary or Affiliate of the Company
where Holdings is not the surviving entity of such consolidation or merger;
provided, however, that each such merger or consolidation shall comply with
Section 5.01. At the request of the Company, the Senior Subordinated Notes
Trustee shall execute and deliver an appropriate instrument evidencing such
release.
SECTION 11.03. Successors and Assigns. This Article 11 shall be
binding upon Holdings and its successors and assigns and shall inure to the
benefit of the successors and assigns of the Senior Subordinated Notes Trustee
and the Senior Subordinated Noteholders and, in the event of any transfer or
assignment of rights by any Senior Subordinated Noteholder or the Senior
Subordinated Notes Trustee, the rights and privileges conferred upon that party
in this Indenture and in the Senior Subordinated Notes shall automatically
extend to and be vested in such transferee or assignee, all subject to the terms
and conditions of this Indenture.
SECTION 11.04. No Waiver. Neither a failure nor a delay on the part
of either the Senior Subordinated Notes Trustee or the Senior Subordinated
Noteholders in exercising any right, power or privilege under this Article 11
shall operate as a waiver thereof, nor shall a single or partial exercise
thereof preclude any other or further exercise of any right, power or privilege.
The rights, remedies and benefits of the Senior Subordinated Notes Trustee and
the Senior Subordinated Noteholders herein expressly specified are cumulative
and not exclusive of any other rights, remedies or benefits which either may
have under this Article 11 at law, in equity, by statute or otherwise.
SECTION 11.05. Modification. No modification, amendment or waiver of
any provision of this Article 11, nor the consent to any departure by Holdings
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Senior Subordinated Notes Trustee, and then such waiver or
consent shall be effective only in the specific instance and for the purpose for
which given. No notice to or demand on Holdings in any case shall entitle
Holdings to any other or further notice or demand in the same, similar or other
circumstances.
ARTICLE 12
Subordination of the Holdings Guarantee
SECTION 12.01. Agreement To Subordinate. Holdings agrees, and each
Senior Subordinated Noteholder by accepting a Senior Subordinated Note agrees,
that the obligations of Holdings hereunder are subordinated in right of payment,
to the extent and in the manner provided in this Article 12, to the prior
payment in full in cash or cash equivalents of all Senior Indebtedness of
Holdings (including all Indebtedness evidenced by the Senior Discount Notes) and
that the subordination is for the benefit of and enforceable by the holders of
such Senior Indebtedness of Holdings. The obligations hereunder with respect to
Holdings shall in all respects rank pari passu with all other
72
Senior Subordinated Indebtedness of Holdings and shall rank senior to all
existing and future Subordinated Obligations of Holdings; and only Indebtedness
of Holdings that is Senior Indebtedness of Holdings shall rank senior to the
obligations of Holdings in accordance with the provisions set forth herein.
SECTION 12.02. Liquidation, Dissolution, Bankruptcy. Upon any
payment or distribution of the assets of Holdings to creditors upon a total or
partial liquidation or a total or partial dissolution of Holdings or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to Holdings and its properties:
(1) holders of Senior Indebtedness of Holdings shall be entitled to
receive payment in full in cash or cash equivalents of such Senior
Indebtedness before the Senior Subordinated Noteholders shall be entitled
to receive any payment pursuant to any Guaranteed Obligations from
Holdings; and
(2) until the Senior Indebtedness of Holdings is paid in full in
cash or cash equivalents, any payment or distribution to which Senior
Subordinated Noteholders would be entitled but for this Article 12 shall
be made to holders of such Senior Indebtedness as their interests may
appear.
SECTION 12.03. Default on Designated Senior Indebtedness of
Holdings. Holdings may not make any payment pursuant to any of the Guaranteed
Obligations or repurchase, redeem or otherwise retire any Senior Subordinated
Notes (collectively, "pay its Holdings Guarantee") if (i) any Designated Senior
Indebtedness of Holdings is not paid in cash or cash equivalents when due or
(ii) any other default on Designated Senior Indebtedness of Holdings occurs and
the maturity of such Designated Senior Indebtedness is accelerated in accordance
with its terms unless, in either case, (x) the default has been cured or waived
and any such acceleration has been rescinded or (y) such Designated Senior
Indebtedness has been paid in full in cash or cash equivalents; provided,
however, that Holdings may pay its Holdings Guarantee without regard to the
foregoing if Holdings and the Senior Subordinated Notes Trustee receive written
notice approving such payment from the Representative of such Designated Senior
Indebtedness with respect to which either of the events set forth in clause (i)
or (ii) of this sentence has occurred and is continuing. During the continuance
of any default (other than a default described in clause (i) or (ii) of the
immediately preceding sentence) with respect to any Designated Senior
Indebtedness of Holdings pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
periods, Holdings may not pay its Holdings Guarantee for a period (a "Payment
Blockage Period") commencing upon the receipt by the Senior Subordinated Notes
Trustee (with a copy to Holdings and the Company) of written notice (a "Blockage
Notice") of such default from the Representative of such Designated Senior
Indebtedness of Holdings specifying an election to effect a Payment Blockage
Period and ending 179 days thereafter (or earlier if such Payment Blockage
Period is terminated (i) by written notice to the Senior Subordinated Notes
Trustee (with a copy to Holdings and the Company) from the Person or Persons who
gave such Blockage Notice, (ii) by repayment in full in cash or cash equivalents
of such Designated Senior Indebtedness or (iii) because the default giving rise
to such Blockage Notice is no longer continuing). Notwithstanding the provisions
described in the immediately preceding sentence (but subject to the provisions
contained in the first sentence of this Section), unless the holders of such
Designated Senior Indebtedness or the Representative of such holders shall have
accelerated the maturity of
73
such Designated Senior Indebtedness, Holdings may resume to paying its Holdings
Guarantee after the end of such Payment Blockage Period, including any missed
payments. Not more than one Blockage Notice may be given with respect to
Holdings in any consecutive 360-day period, irrespective of the number of
defaults with respect to Designated Senior Indebtedness of Holdings during such
period; provided, however, that if any Blockage Notice within such 360-day
period is given by or on behalf of any holders of Designated Senior Indebtedness
of Holdings other than the Bank Indebtedness, the Representative of the Bank
Indebtedness may give another Blockage Notice within such period; provided
further, however, that in no event may the total number of days during which any
Payment Blockage Period or Periods is in effect exceed 179 days in the aggregate
during any 360-consecutive day period. For purposes of this Section, no default
or event of default that existed or was continuing on the date of the
commencement of any Payment Blockage Period with respect to the Designated
Senior Indebtedness initiating such Payment Blockage Period shall be, or be
made, the basis of the commencement of a subsequent Payment Blockage Period by
the Representative of such Designated Senior Indebtedness, whether or not within
a period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 12.04. Demand for Payment. If payment of the Senior
Subordinated Notes is accelerated because of an Event of Default and a demand
for payment is made on Holdings pursuant to Article 11, the Senior Subordinated
Notes Trustee shall promptly notify the holders of the Designated Senior
Indebtedness of Holdings (or the Representative of such holders) of such demand.
If any Designated Senior Indebtedness of Holdings is outstanding, Holdings may
not pay its Holdings Guarantee until five Business Days after such holders or
the Representative of the holders of the Designated Senior Indebtedness of
Holdings receive notice of such demand and, thereafter, may pay its Holdings
Guarantee only if this Article 12 otherwise permits payment at that time.
SECTION 12.05. When Distribution Must Be Paid Over. If a payment or
distribution is made to Senior Subordinated Noteholders that because of this
Article 12 should not have been made to them, the Senior Subordinated
Noteholders who receive the payment or distribution shall hold such payment or
distribution in trust for holders of the Senior Indebtedness of Holdings and pay
it over to them as their respective interests may appear.
SECTION 12.06. Subrogation. After all Senior Indebtedness of
Holdings is paid in full and until the Senior Subordinated Notes are paid in
full, Senior Subordinated Noteholders shall be subrogated to the rights of
holders of such Senior Indebtedness of Holdings to receive distributions
applicable to Senior Indebtedness of Holdings. A distribution made under this
Article 12 to holders of Designated Senior Indebtedness of Holdings which
otherwise would have been made to Senior Subordinated Noteholders is not, as
between Holdings and Senior Subordinated Noteholders, a payment by Holdings on
such Senior Indebtedness of Holdings.
74
SECTION 12.07. Relative Rights. This Article 12 defines the relative
rights of Senior Subordinated Noteholders and holders of Senior Indebtedness of
Holdings. Nothing in this Indenture shall:
(1) impair, as between Holdings and Senior Subordinated Noteholders,
the obligation of Holdings which is absolute and unconditional, to make
payments with respect to the Guaranteed Obligations to the extent set
forth in Article 11; or
(2) prevent the Senior Subordinated Notes Trustee or any Senior
Subordinated Noteholder from exercising its available remedies upon a
default by Holdings under its obligations with respect to the Guaranteed
Obligations, subject to the rights of holders of Senior Indebtedness of
Holdings to receive distributions otherwise payable to Senior Subordinated
Noteholders.
SECTION 12.08. Subordination May Not Be Impaired by Holdings. No
right of any holder of Senior Indebtedness of Holdings to enforce the
subordination of the obligations of Holdings hereunder shall be impaired by any
act or failure to act by Holdings or by its failure to comply with this
Indenture.
SECTION 12.09. Rights of Senior Subordinated Notes Trustee and
Paying Agent. Notwithstanding Section 12.03, the Senior Subordinated Notes
Trustee or the Paying Agent may continue to make payments on the Senior
Subordinated Notes and shall not be charged with knowledge of the existence of
facts that would prohibit the making of any such payments unless, not less than
two Business Days prior to the date of such payment, a Trust Officer of the
Senior Subordinated Notes Trustee receives notice satisfactory to it that
payments may not be made under this Article 12. Holdings, the Registrar or
co-registrar, the Paying Agent, a Representative or a holder of Senior
Indebtedness of Holdings give the notice; provided, however, that if an issue of
Senior Indebtedness of Holdings has a Representative, only the Representative
may give the notice.
The Senior Subordinated Notes Trustee in its individual or any other
capacity may hold Senior Indebtedness of Holdings with the same rights it would
have if it were not Senior Subordinated Notes Trustee. The Registrar and
co-registrar and the Paying Agent may do the same with like rights. The Senior
Subordinated Notes Trustee shall be entitled to all the rights set forth in this
Article 12 with respect to any Senior Indebtedness of Holdings which may at any
time be held by it, to the same extent as any other holder of Senior
Indebtedness of Holdings; and nothing in Article 7 shall deprive the Senior
Subordinated Notes Trustee of any of its rights as such holder. Nothing in this
Article 12 shall apply to claims of, or payments to, the Senior Subordinated
Notes Trustee under or pursuant to Section 7.07.
SECTION 12.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of Holdings, the distribution may be made and the notice given to their
Representative (if any).
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit
Right To Accelerate. The failure of Holdings to make a payment on any of its
obligations by reason of any provision in this Article 12 shall not be construed
as preventing the occurrence of a default by Holdings under such obligations.
Nothing in
75
this Article 12 shall have any effect on the right of the Senior Subordinated
Noteholders or the Senior Subordinated Notes Trustee to make a demand for
payment on Holdings pursuant to Article 11.
SECTION 12.12. Senior Subordinated Notes Trustee Entitled To Rely.
Upon any payment or distribution pursuant to this Article 12, the Senior
Subordinated Notes Trustee and the Senior Subordinated Noteholders shall be
entitled to rely (i) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 12.02
are pending, (ii) upon a certificate of the liquidating trustee or agent or
other Person making such payment or distribution to the Senior Subordinated
Notes Trustee or to the Senior Subordinated Noteholders or (iii) upon the
Representatives for the holders of Senior Indebtedness of Holdings for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of such Senior Indebtedness of Holdings and other
Indebtedness of Holdings, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article 12. In the event that the Senior Subordinated Notes Trustee
determines, in good faith, that evidence is required with respect to the right
of any Person as a holder of Senior Indebtedness of Holdings to participate in
any payment or distribution pursuant to this Article 12, the Senior Subordinated
Notes Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Senior Subordinated Notes Trustee as to the amount of such
Senior Indebtedness of Holdings held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and other
facts pertinent to the rights of such Person under this Article 12, and, if such
evidence is not furnished, the Senior Subordinated Notes Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections 7.01 and 7.02 shall
be applicable to all actions or omissions of actions by the Senior Subordinated
Notes Trustee pursuant to this Article 12.
SECTION 12.13. Senior Subordinated Notes Trustee To Effectuate
Subordination. Each Senior Subordinated Noteholder by accepting a Senior
Subordinated Note authorizes and directs the Senior Subordinated Notes Trustee
on his or her behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the Senior Subordinated
Noteholders and the holders of Senior Indebtedness of Holdings as provided in
this Article 12 and appoints the Senior Subordinated Notes Trustee as
attorney-in-fact for any and all such purposes.
SECTION 12.14. Senior Subordinated Notes Trustee Not Fiduciary for
Holders of Senior Indebtedness of Holdings. The Senior Subordinated Notes
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness of Holdings and shall not be liable to any such holders if it shall
mistakenly pay over or distribute to Senior Subordinated Noteholders or Holdings
or any other Person, money or assets to which any holders of Senior Indebtedness
of Holdings shall be entitled by virtue of this Article 12 or otherwise.
SECTION 12.15. Reliance by Holders of Senior Indebtedness of
Holdings on Subordination Provisions. Each Senior Subordinated Noteholder by
accepting a Senior Subordinated Note acknowledges and agrees that the foregoing
subordination provisions are, and are intended to be, an inducement and a
consideration to each holder of any Senior Indebtedness of Holdings, whether
such Senior Indebtedness was created or acquired before or after the issuance of
the Senior Subordinated Notes, to
76
acquire and continue to hold, or to continue to hold, such Senior Indebtedness
and such holder of Senior Indebtedness shall be deemed conclusively to have
relied on such subordination provisions in acquiring and continuing to hold, or
in continuing to hold, such Senior Indebtedness.
SECTION 12.16. Defeasance. The terms of this Article 12 shall not
apply to payments from money or the proceeds of U.S. Government Obligations held
in trust by the Senior Subordinated Notes Trustee for the payment of principal
of and interest on the Senior Subordinated Notes pursuant to the provisions
described in Section 8.03.
ARTICLE 13
Miscellaneous
SECTION 13.01. Trust Indenture Act Controls. If any provision of
this Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 13.02. Notices. Any notice or communication shall be in
writing and delivered in person or mailed by first-class mail addressed as
follows:
if to the Company:
WESCO Distribution, Inc.
Commerce Court, Suite 000
Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
if to the Senior Subordinated Notes Trustee:
Bank One, N.A.
000 Xxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Department
The Company or the Senior Subordinated Notes Trustee by notice to
the other may designate additional or different addresses for subsequent notices
or communications.
Any notice or communication mailed to a Senior Subordinated
Noteholder shall be mailed to the Senior Subordinated Noteholder at the Senior
Subordinated Noteholder's address as it appears on the registration books of the
Registrar and shall be sufficiently given if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Senior Subordinated
Noteholder or any defect in it shall not affect its sufficiency with respect to
other Senior
77
Subordinated Noteholders. If a notice or communication is mailed in the manner
provided above, it is duly given, whether or not the addressee receives it.
SECTION 13.03. Communication by Senior Subordinated Noteholders with
Other Senior Subordinated Noteholders. Senior Subordinated Noteholders may
communicate pursuant to TIA ss. 312(b) with other Senior Subordinated
Noteholders with respect to their rights under this Indenture or the Senior
Subordinated Notes. The Company, the Senior Subordinated Notes Trustee, the
Registrar and anyone else shall have the protection of TIA ss. 312(c).
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Senior Subordinated Notes
Trustee to take or refrain from taking any action under this Indenture, the
Company shall furnish to the Senior Subordinated Notes Trustee:
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Senior Subordinated Notes Trustee stating that, in the
opinion of the signers, all conditions precedent, if any, provided for in
this Indenture relating to the proposed action have been complied with;
and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Senior Subordinated Notes Trustee stating that, in the
opinion of such counsel, all such conditions precedent have been complied
with.
SECTION 13.05. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 13.06. When Senior Subordinated Notes Disregarded. In
determining whether the Senior Subordinated Noteholders of the required
principal amount of Senior Subordinated Notes have concurred in any direction,
waiver or consent, Senior Subordinated Notes owned by the Company, Holdings or
by any Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company or Holdings shall be
disregarded and deemed not to be outstanding, except that, for the purpose of
determining whether the Senior Subordinated Notes Trustee shall be protected in
relying on any such direction, waiver or consent, only
78
Senior Subordinated Notes which the Senior Subordinated Notes Trustee knows are
so owned shall be so disregarded. Subject to the foregoing, only Senior
Subordinated Notes outstanding at the time shall be considered in any such
determination.
SECTION 13.07. Rules by Senior Subordinated Notes Trustee, Paying
Agent and Registrar. The Senior Subordinated Notes Trustee may make reasonable
rules for action by or a meeting of Senior Subordinated Noteholders. The
Registrar and the Paying Agent may make reasonable rules for their functions.
SECTION 13.08. Legal Holidays. A "Legal Holiday" is a Saturday, a
Sunday or a day on which banking institutions are not required to be open in the
State of New York or the State of Ohio. If a payment date is a Legal Holiday,
payment shall be made on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period. If a regular record
date is a Legal Holiday, the record date shall not be affected.
SECTION 13.09. GOVERNING LAW. THIS INDENTURE AND THE SENIOR
SUBORDINATED NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES
OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
SECTION 13.10. No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Senior Subordinated Notes or this
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Senior Subordinated Note, each
Senior Subordinated Noteholder shall waive and release all such liability. The
waiver and release shall be part of the consideration for the issue of the
Senior Subordinated Notes.
SECTION 13.11. Successors. All agreements of the Company and
Holdings in this Indenture and the Senior Subordinated Notes shall bind its
successors. All agreements of the Senior Subordinated Notes Trustee in this
Indenture shall bind its successors.
SECTION 13.12. Multiple Originals. The parties may sign any number
of copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Indenture.
SECTION 13.13. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
79
IN WITNESS WHEREOF, the parties have caused this Indenture to be
duly executed as of the date first written above.
WESCO DISTRIBUTION, INC.,
by /s/ [Illegible]
------------------------------------
Name:
Title:
WESCO INTERNATIONAL, INC.,
by /s/ [Illegible]
------------------------------------
Name:
Title:
BANK ONE, N.A., as Senior Subordinated
Notes Trustee
by /s/ Xxxx X. Xxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President, Corporate
Trust Department
APPENDIX A
PROVISIONS RELATING TO ORIGINAL SENIOR SUBORDINATED NOTES,
ADDITIONAL SENIOR SUBORDINATED NOTES, PRIVATE SENIOR
SUBORDINATED EXCHANGE NOTES AND
SENIOR SUBORDINATED EXCHANGE NOTES
1. Definitions
1.1 Definitions
For the purposes of this Appendix A the following terms shall have the
meanings indicated below:
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Regulation S Global Senior Subordinated Note or
beneficial interest therein, the rules and procedures of the Depositary for such
Global Senior Subordinated Note, Euroclear and Cedel, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Cedel" means Cedel Bank, S.A., or any successor securities clearing
agency.
"Definitive Senior Subordinated Note" means a certificated Initial
Senior Subordinated Note or Senior Subordinated Exchange Note (bearing the
Restricted Senior Subordinated Notes Legend if the transfer of such Senior
Subordinated Note is restricted by applicable law) that does not include the
Global Senior Subordinated Notes Legend.
"Depositary" means The Depository Trust Company, its nominees and
their respective successors.
"Euroclear" means the Euroclear Clearance System or any successor
securities clearing agency.
"Global Senior Subordinated Notes Legend" means the legend set forth
under that caption in Exhibit A to this Indenture.
"IAI" means an institutional "accredited investor" as described in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
"Initial Purchasers" means Chase Securities Inc. and Xxxxxx Brothers
Inc.
"Private Senior Subordinated Exchange Notes" means the Senior
Subordinated Notes of the Company issued in exchange for Initial Senior
Subordinated Notes pursuant to this Indenture in connection with a Senior
Subordinated Notes Private Exchange pursuant to a Senior Subordinated Notes
Registration Agreement.
"Purchase Agreement" means (i) the Purchase Agreement dated May 29,
1998, among the Company, Holdings and the Initial Purchasers and (ii) any other
similar Purchase Agreement relating to Additional Senior Subordinated Notes.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
2
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Senior Subordinated Notes" means all Initial Senior
Subordinated Notes offered and sold outside the United States in reliance on
Regulation S.
"Restricted Period", with respect to any Senior Subordinated Notes,
means the period of 40 consecutive days beginning on and including the later of
(i) the day on which such Senior Subordinated Notes are first offered to persons
other than distributors (as defined in Regulation S under the Securities Act) in
reliance on Regulation S and (ii) the Senior Subordinated Notes Issue Date with
respect to such Senior Subordinated Notes.
"Restricted Senior Subordinated Notes Legend" means the legend set
forth in Section 2.3(e)(i) herein.
"Rule 501" means Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Senior Subordinated Notes" means all Initial Senior
Subordinated Notes offered and sold to QIBs in reliance on Rule 144A.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Subordinated Notes Custodian" means the custodian with
respect to a Global Senior Subordinated Note (as appointed by the Depositary) or
any successor person thereto, who shall initially be the Senior Subordinated
Notes Trustee.
"Senior Subordinated Notes Private Exchange" means an offer by the
Company, pursuant to a Senior Subordinated Notes Registration Agreement, to
issue and deliver to certain purchasers, in exchange for the Initial Senior
Subordinated Notes held by such purchasers as part of their initial
distribution, a like aggregate principal amount of Private Senior Subordinated
Exchange Notes.
"Senior Subordinated Notes Registered Exchange Offer" means an offer
by the Company, pursuant to a Senior Subordinated Notes Registration Agreement,
to certain Holders of Initial Senior Subordinated Notes, to issue and deliver to
such Holders, in exchange for their Initial Senior Subordinated Notes, a like
aggregate principal amount of Senior Subordinated Exchange Notes registered
under the Securities Act.
"Senior Subordinated Notes Registration Agreement" means (i) the
Exchange and Registration Rights Agreement dated June 5, 1998, among the
Company, Holdings and the Initial Purchasers and (ii) any other similar Exchange
and Registration Rights Agreement relating to Additional Senior Subordinated
Notes.
"Senior Subordinated Notes Shelf Registration Statement" means a
registration statement filed by the Company in connection with the offer and
sale of Initial Senior Subordinated Notes pursuant to a Senior Subordinated
Notes Registration Agreement.
3
"Transfer Restricted Senior Subordinated Notes" means Definitive
Senior Subordinated Notes and any other Senior Subordinated Notes that bear or
are required to bear the Restricted Senior Subordinated Notes Legend.
1.2 Other Definitions
Term: Defined in Section:
----- -------------------
"Agent Members".......................................................2.1(b)
"IAI Global Senior Subordinated Note..................................2.1(a)
"Global Senior Subordinated Note".....................................2.1(a)
"Regulation S Global Senior Subordinated Note"........................2.1(a)
"Rule 144A Global Senior Subordinated Note"...........................2.1(a)
2. The Senior Subordinated Notes
2.1 Form and Dating
The Initial Senior Subordinated Notes issued on the date hereof will
be (i) offered and sold by the Company pursuant to a Purchase Agreement and (ii)
resold, initially only to (A) QIBs in reliance on Rule 144A and (B) Persons
other than U.S. Persons (as defined in Regulation S) in reliance on Regulation
S. Such Initial Senior Subordinated Notes may thereafter be transferred to,
among others, QIBs, purchasers in reliance on Regulation S and, except as set
forth below, IAIs in accordance with Rule 501. Additional Senior Subordinated
Notes offered after the date hereof may be offered and sold by the Company from
time to time pursuant to one or more Purchase Agreements in accordance with
applicable law.
(a) Global Senior Subordinated Notes. Rule 144A Senior Subordinated
Notes shall be issued initially in the form of one or more permanent global
Senior Subordinated Notes in definitive, fully registered form (collectively,
the "Rule 144A Global Senior Subordinated Note") and Regulation S Senior
Subordinated Notes shall be issued initially in the form of one or more global
Senior Subordinated Notes (collectively, the "Regulation S Global Senior
Subordinated Note"), in each case without interest coupons and bearing the
Global Senior Subordinated Notes Legend and Restricted Senior Subordinated Notes
Legend, which shall be deposited on behalf of the purchasers of the Senior
Subordinated Notes represented thereby with the Senior Subordinated Notes
Custodian, and registered in the name of the Depositary or a nominee of the
Depositary, duly executed by the Company and authenticated by the Senior
Subordinated Notes Trustee as provided in this Indenture. One or more global
securities in definitive, fully registered form without interest coupons and
bearing the Global Senior Subordinated Notes Legend and the Restricted Senior
Subordinated Notes Legend (collectively, the "IAI Global Senior Subordinated
Note") shall also be issued on the Closing Date, deposited with the Senior
Subordinated Notes Custodian, and registered in the name of the Depositary or a
nominee of the Depositary, duly executed by the Company and authenticated by the
Senior Subordinated Notes Trustee as provided in this Indenture to accommodate
transfers of beneficial interests in the Senior Subordinated Notes to IAIs
subsequent to the initial distribution. Beneficial ownership interests in the
Regulation S Global Senior Subordinated Note will not be exchangeable for
interests in the Rule 144A Global Senior Subordinated Note, the IAI Global
Senior Subordinated Note or any other Senior Subordinated Note without a
Restricted Senior Subordinated Notes Legend
4
until the expiration of the Restricted Period. The Rule 144A Global Senior
Subordinated Note, the IAI Global Senior Subordinated Note and the Regulation S
Global Senior Subordinated Note are each referred to herein as a "Global Senior
Subordinated Note" and are collectively referred to herein as "Global Senior
Subordinated Notes." The aggregate principal amount of the Global Senior
Subordinated Notes may from time to time be increased or decreased by
adjustments made on the records of the Senior Subordinated Notes Trustee and the
Depositary or its nominee as hereinafter provided.
(b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a
Global Senior Subordinated Note deposited with or on behalf of the Depositary.
The Company shall execute and the Senior Subordinated Notes Trustee
shall, in accordance with this Section 2.1(b) and pursuant to an order of the
Company, authenticate and deliver initially one or more Global Senior
Subordinated Notes that (a) shall be registered in the name of the Depositary
for such Global Senior Subordinated Note or Global Senior Subordinated Notes or
the nominee of such Depositary and (b) shall be delivered by the Senior
Subordinated Notes Trustee to such Depositary or pursuant to such Depositary's
instructions or held by the Senior Subordinated Notes Trustee as Senior
Subordinated Notes Custodian.
Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any Global Senior
Subordinated Note held on their behalf by the Depositary or by the Senior
Subordinated Notes Trustee as Senior Subordinated Notes Custodian or under such
Global Senior Subordinated Note, and the Depositary may be treated by the
Company, the Senior Subordinated Notes Trustee and any agent of the Company or
the Senior Subordinated Notes Trustee as the absolute owner of such Global
Senior Subordinated Note for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Senior Subordinated
Notes Trustee or any agent of the Company or the Senior Subordinated Notes
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices of such Depositary
governing the exercise of the rights of a holder of a beneficial interest in any
Global Senior Subordinated Note.
(c) Definitive Senior Subordinated Notes. Except as provided in
Section 2.3 or 2.4, owners of beneficial interests in Global Senior Subordinated
Notes will not be entitled to receive physical delivery of certificated Senior
Subordinated Notes.
2.2 Authentication. The Senior Subordinated Notes Trustee shall
authenticate and make available for delivery upon a written order of the Company
signed by two Officers (1) Original Senior Subordinated Notes for original issue
on the date hereof in an aggregate principal amount of $300 million, (2) subject
to the terms of this Indenture, Additional Senior Subordinated Notes in an
aggregate principal amount of up to $200 million and (3) the (A) Senior
Subordinated Exchange Notes for issue only in a Senior Subordinated Notes
Registered Exchange Offer and (B) Private Senior Subordinated Exchange Notes for
issue only in a Senior Subordinated Notes Private Exchange, in the case of each
of (A) and (B) pursuant to a Senior Subordinated Notes Registration Agreement
and for a like principal amount of Initial Senior Subordinated Notes exchanged
pursuant thereto. Such order shall specify the amount of the Senior Subordinated
Notes to be authenticated, the date on which the original issue of Senior
Subordinated Notes is to be authenticated and whether the Senior Subordinated
Notes are to be Initial Senior Subordinated Notes, Senior Subordinated
5
Exchange Notes or Private Senior Subordinated Exchange Notes. The aggregate
principal amount of Senior Subordinated Notes outstanding at any time may not
exceed $500 million, except as provided in Section 2.08 of this Indenture.
Notwithstanding anything to the contrary in this Appendix or otherwise in this
Indenture, any issuance of Additional Senior Subordinated Notes after the
Closing Date shall be in a principal amount of at least $50 million, whether
such Additional Senior Subordinated Notes are of the same or a different series
than the Original Senior Subordinated Notes.
2.3 Transfer and Exchange. (a) Transfer and Exchange of Definitive Senior
Subordinated Notes. When Definitive Senior Subordinated Notes are presented to
the Registrar with a request:
(x) to register the transfer of such Definitive Senior Subordinated
Notes; or
(y) to exchange such Definitive Senior Subordinated Notes for an
equal principal amount of Definitive Senior Subordinated Notes of other
authorized denominations,
the Registrar shall register the transfer or make the exchange as requested if
its reasonable requirements for such transaction are met; provided, however,
that the Definitive Senior Subordinated Notes surrendered for transfer or
exchange:
(i) shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar,
duly executed by the Senior Subordinated Noteholder thereof or his
attorney duly authorized in writing; and
(ii) are accompanied by the following additional information and
documents, as applicable:
(A) if such Definitive Senior Subordinated Notes are being
delivered to the Registrar by a Senior Subordinated Noteholder for
registration in the name of such Senior Subordinated Noteholder,
without transfer, a certification from such Senior Subordinated
Noteholder to that effect (in the form set forth on the reverse side
of the Initial Senior Subordinated Note); or
(B) if such Definitive Senior Subordinated Notes are being
transferred to the Company, a certification to that effect (in the
form set forth on the reverse side of the Initial Senior
Subordinated Note); or
(C) if such Definitive Senior Subordinated Notes are being
transferred pursuant to an exemption from registration in accordance
with Rule 144 under the Securities Act or in reliance upon another
exemption from the registration requirements of the Securities Act,
(i) a certification to that effect (in the form set forth on the
reverse side of the Initial Senior Subordinated Note) and (ii) if
the Company so requests, an opinion of counsel or other evidence
reasonably satisfactory to it as to the compliance with the
restrictions set forth in the legend set forth in Section 2.3(e)(i).
(b) Restrictions on Transfer of a Definitive Senior Subordinated
Note for a Beneficial Interest in a Global Senior Subordinated Note. A
Definitive Senior Subordinated
6
Note may not be exchanged for a beneficial interest in a Global Senior
Subordinated Note except upon satisfaction of the requirements set forth below.
Upon receipt by the Senior Subordinated Notes Trustee of a Definitive Senior
Subordinated Note, duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Company and the Registrar,
together with:
(i) certification (in the form set forth on the reverse side of the
Initial Senior Subordinated Note) that such Definitive Senior Subordinated
Note is being transferred (A) to a QIB in accordance with Rule 144A, (B)
to an IAI that has furnished to the Senior Subordinated Notes Trustee a
signed letter substantially in the form of Exhibit D or (C) outside the
United States in an offshore transaction within the meaning of Regulation
S and in compliance with Rule 904 under the Securities Act; and
(ii) written instructions directing the Senior Subordinated Notes
Trustee to make, or to direct the Senior Subordinated Notes Custodian to
make, an adjustment on its books and records with respect to such Global
Senior Subordinated Note to reflect an increase in the aggregate principal
amount of the Senior Subordinated Notes represented by the Global Senior
Subordinated Note, such instructions to contain information regarding the
Depositary account to be credited with such increase,
then the Senior Subordinated Notes Trustee shall cancel such Definitive Senior
Subordinated Note and cause, or direct the Senior Subordinated Notes Custodian
to cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Senior Subordinated Notes Custodian, the
aggregate principal amount of Senior Subordinated Notes represented by the
Global Senior Subordinated Note to be increased by the aggregate principal
amount of the Definitive Senior Subordinated Note to be exchanged and shall
credit or cause to be credited to the account of the Person specified in such
instructions a beneficial interest in the Global Senior Subordinated Note equal
to the principal amount of the Definitive Senior Subordinated Note so canceled.
If no Global Senior Subordinated Notes are then outstanding and the Global
Senior Subordinated Note has not been previously exchanged for certificated
securities pursuant to Section 2.4, the Company shall issue and the Senior
Subordinated Notes Trustee shall authenticate, upon written order of the Company
in the form of an Officers' Certificate, a new Global Senior Subordinated Note
in the appropriate principal amount.
(c) Transfer and Exchange of Global Senior Subordinated Notes. (i)
The transfer and exchange of Global Senior Subordinated Notes or beneficial
interests therein shall be effected through the Depositary, in accordance with
this Indenture (including applicable restrictions on transfer set forth herein,
if any) and the procedures of the Depositary therefor. A transferor of a
beneficial interest in a Global Senior Subordinated Note shall deliver a written
order given in accordance with the Depositary's procedures containing
information regarding the participant account of the Depositary to be credited
with a beneficial interest in such Global Senior Subordinated Note or another
Global Senior Subordinated Note and such account shall be credited in accordance
with such order with a beneficial interest in the applicable Global Senior
Subordinated Note and the account of the Person making the transfer shall be
debited by an amount equal to the beneficial interest in the Global Senior
Subordinated Note being transferred. Transfers by an owner of a beneficial
interest in the Rule 144A Global Senior Subordinated Note or the IAI Global
Senior Subordinated Note to a transferee who takes delivery of such interest
through the
7
Regulation S Global Senior Subordinated Note, whether before or after the
expiration of the Restricted Period, will be made only upon receipt by the
Senior Subordinated Notes Trustee of a certification from the transferor to the
effect that such transfer is being made in accordance with Regulation S or (if
available) Rule 144 under the Securities Act and that, if such transfer is being
made prior to the expiration of the Restricted Period, the interest transferred
will be held immediately thereafter through Euroclear or Cedel. In the case of a
transfer of a beneficial interest in either the Regulation S Global Senior
Subordinated Note or the Rule 144A Global Senior Subordinated Note for an
interest in the IAI Global Senior Subordinated Note, the transferee must furnish
a signed letter substantially in the form of Exhibit D to the Senior
Subordinated Notes Trustee.
(ii) If the proposed transfer is a transfer of a beneficial interest
in one Global Senior Subordinated Note to a beneficial interest in another
Global Senior Subordinated Note, the Registrar shall reflect on its books
and records the date and an increase in the principal amount of the Global
Senior Subordinated Note to which such interest is being transferred in an
amount equal to the principal amount of the interest to be so transferred,
and the Registrar shall reflect on its books and records the date and a
corresponding decrease in the principal amount of Global Senior
Subordinated Note from which such interest is being transferred.
(iii) Notwithstanding any other provisions of this Appendix (other
than the provisions set forth in Section 2.4), a Global Senior
Subordinated Note may not be transferred as a whole except by the
Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by
the Depositary or any such nominee to a successor Depositary or a nominee
of such successor Depositary.
(iv) In the event that a Global Senior Subordinated Note is
exchanged for Definitive Senior Subordinated Notes pursuant to Section 2.4
prior to the consummation of a Senior Subordinated Notes Registered
Exchange Offer or the effectiveness of a Senior Subordinated Notes Shelf
Registration Statement with respect to such Senior Subordinated Notes,
such Senior Subordinated Notes may be exchanged only in accordance with
such procedures as are substantially consistent with the provisions of
this Section 2.3 (including the certification requirements set forth on
the reverse of the Initial Senior Subordinated Notes intended to ensure
that such transfers comply with Rule 144A, Regulation S or such other
applicable exemption from registration under the Securities Act, as the
case may be) and such other procedures as may from time to time be adopted
by the Company.
(d) Restrictions on Transfer of Regulation S Global Senior
Subordinated Note. (i) Prior to the expiration of the Restricted Period,
interests in the Regulation S Global Senior Subordinated Note may only be held
through Euroclear or Cedel. During the Restricted Period, beneficial ownership
interests in the Regulation S Global Senior Subordinated Note may only be sold,
pledged or transferred through Euroclear or Cedel in accordance with the
Applicable Procedures and only (A) to the Company, (B) so long as such security
is eligible for resale pursuant to Rule 144A, to a person whom the selling
holder reasonably believes is a QIB that purchases for its own account or for
the account of a QIB to whom notice is given that the resale, pledge or transfer
is being made in reliance on Rule 144A, (C) in an offshore transaction in
accordance with Regulation S, (D) pursuant to an exemption from registration
under the Securities Act provided by Rule 144 (if applicable) under the
Securities Act, (E) to an IAI purchasing for its own account, or for the account
of
8
such an IAI, in a minimum principal amount of Senior Subordinated Notes of
$250,000 or (F) pursuant to an effective registration statement under the
Securities Act, in each case in accordance with any applicable securities laws
of any state of the United States. Prior to the expiration of the Restricted
Period, transfers by an owner of a beneficial interest in the Regulation S
Global Senior Subordinated Note to a transferee who takes delivery of such
interest through the Rule 144A Global Senior Subordinated Note or the IAI Global
Senior Subordinated Note will be made only in accordance with Applicable
Procedures and upon receipt by the Senior Subordinated Notes Trustee of a
written certification from the transferor of the beneficial interest in the form
provided on the reverse of the Initial Senior Subordinated Note to the effect
that such transfer is being made to (i) a person whom the transferor reasonably
believes is a QIB within the meaning of Rule 144A in a transaction meeting the
requirements of Rule 144A or (ii) an IAI purchasing for its own account, or for
the account of such an IAI, in a minimum principal amount of the Senior
Subordinated Notes of $250,000. Such written certification will no longer be
required after the expiration of the Restricted Period. In the case of a
transfer of a beneficial interest in the Regulation S Global Senior Subordinated
Note for an interest in the IAI Global Senior Subordinated Note, the transferee
must furnish a signed letter substantially in the form of Exhibit D to the
Senior Subordinated Notes Trustee.
(ii) Upon the expiration of the Restricted Period, beneficial
ownership interests in the Regulation S Global Senior Subordinated Note
will be transferable in accordance with applicable law and the other terms
of this Indenture.
(e) Legend.
(i) Except as permitted by the following paragraphs (ii), (iii) or
(iv), each Senior Subordinated Note certificate evidencing the Global
Senior Subordinated Notes and the Definitive Senior Subordinated Notes
(and all Senior Subordinated Notes issued in exchange therefor or in
substitution thereof) shall bear a legend in substantially the following
form (each defined term in the legend being defined as such for purposes
of the legend only):
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE
9
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO
WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO
AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2), (3) OR
(7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR
ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH
A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST
OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
Each Definitive Senior Subordinated Note will also bear the following additional
legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION
AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE
TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS."
(ii) Upon any sale or transfer of a Transfer Restricted Senior
Subordinated Note that is a Definitive Senior Subordinated Note, the
Registrar shall permit the Senior Subordinated Noteholder thereof to
exchange such Transfer Restricted Senior Subordinated Note for a
Definitive Senior Subordinated Note that does not bear the legends set
forth above and rescind any restriction on the transfer of such Transfer
Restricted Senior Subordinated Note if the Senior Subordinated Noteholder
certifies in writing to the Registrar that its request for such exchange
was made in reliance on Rule 144 (such certification to be in the form set
forth on the reverse of the Initial Senior Subordinated Note).
(iii) After a transfer of any Initial Senior Subordinated Notes or
Private Exchange Senior Subordinated Notes during the period of the
effectiveness of a Senior Subordinated Notes Shelf Registration Statement
with respect to such Initial Senior Subordinated Notes or Private Senior
Subordinated Exchange Notes, as the case may be, all requirements
pertaining to the Restricted Senior Subordinated Notes Legend on such
Initial Senior Subordinated Notes or such Private Senior
10
Subordinated Exchange Notes will cease to apply and the requirements that
any such Initial Senior Subordinated Notes or such Private Senior
Subordinated Exchange Notes be issued in global form will continue to
apply.
(iv) Upon the consummation of a Senior Subordinated Notes Registered
Exchange Offer with respect to the Initial Senior Subordinated Notes
pursuant to which Senior Subordinated Noteholders of such Initial Senior
Subordinated Notes are offered Senior Subordinated Exchange Notes in
exchange for their Initial Senior Subordinated Notes, all requirements
pertaining to Initial Senior Subordinated Notes that Initial Senior
Subordinated Notes be issued in global form will continue to apply, and
Senior Subordinated Exchange Notes in global form without the Restricted
Senior Subordinated Notes Legend will be available to Senior Subordinated
Noteholders that exchange such Initial Senior Subordinated Notes in such
Senior Subordinated Notes Registered Exchange Offer.
(v) Upon the consummation of a Senior Subordinated Notes Private
Exchange with respect to the Initial Senior Subordinated Notes pursuant to
which Holders of such Initial Senior Subordinated Notes are offered
Private Senior Subordinated Exchange Notes in exchange for their Initial
Senior Subordinated Notes, all requirements pertaining to such Initial
Senior Subordinated Notes that Initial Senior Subordinated Notes be issued
in global form will continue to apply, and Private Senior Subordinated
Exchange Notes in global form with the Restricted Senior Subordinated
Notes Legend will be available to Senior Subordinated Noteholders that
exchange such Initial Senior Subordinated Notes in such Senior
Subordinated Notes Private Exchange.
(vi) Upon a sale or transfer after the expiration of the Restricted
Period of any Initial Senior Subordinated Note acquired pursuant to
Regulation S, all requirements that such Initial Senior Subordinated Note
bear the Restricted Senior Subordinated Notes Legend will cease to apply
and the requirements requiring any such Initial Senior Subordinated Note
be issued in global form will continue to apply.
(vii) Any Additional Senior Subordinated Notes sold in a registered
offering shall not be required to bear the Restricted Senior Subordinated
Notes Legend.
(f) Cancelation or Adjustment of Global Senior Subordinated Note. At
such time as all beneficial interests in a Global Senior Subordinated Note have
either been exchanged for Definitive Senior Subordinated Notes, transferred,
redeemed, repurchased or canceled, such Global Senior Subordinated Note shall be
returned by the Depositary to the Senior Subordinated Notes Trustee for
cancelation or retained and canceled by the Senior Subordinated Notes Trustee.
At any time prior to such cancelation, if any beneficial interest in a Global
Senior Subordinated Note is exchanged for Definitive Senior Subordinated Notes,
transferred in exchange for an interest in another Global Senior Subordinated
Note, redeemed, repurchased or canceled, the principal amount of Senior
Subordinated Notes represented by such Global Senior Subordinated Note shall be
reduced and an adjustment shall be made on the books and records of the Senior
Subordinated Notes Trustee (if it is then the Senior Subordinated Notes
Custodian for such Global Senior Subordinated Note) with respect to such Global
Senior Subordinated Note, by the Senior Subordinated Notes Trustee or the Senior
Subordinated Notes Custodian, to reflect such reduction.
11
(g) Obligations with Respect to Transfers and Exchanges of Senior
Subordinated Notes.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Senior Subordinated Notes Trustee shall
authenticate, Definitive Senior Subordinated Notes and Global Senior
Subordinated Notes at the Registrar's request.
(ii) No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax, assessments, or similar governmental
charge payable in connection therewith (other than any such transfer
taxes, assessments or similar governmental charge payable upon exchange or
transfer pursuant to Section 3.06, 4.06, 4.08 and 9.05).
(iii) Prior to the due presentation for registration of transfer of
any Senior Subordinated Note, the Company, the Senior Subordinated Notes
Trustee, the Paying Agent or the Registrar may deem and treat the person
in whose name a Senior Subordinated Note is registered as the absolute
owner of such Senior Subordinated Note for the purpose of receiving
payment of principal of and interest on such Senior Subordinated Note and
for all other purposes whatsoever, whether or not such Senior Subordinated
Note is overdue, and none of the Company, the Senior Subordinated Notes
Trustee, the Paying Agent or the Registrar shall be affected by notice to
the contrary.
(iv) All Senior Subordinated Notes issued upon any transfer or
exchange pursuant to the terms of this Indenture shall evidence the same
debt and shall be entitled to the same benefits under this Indenture as
the Senior Subordinated Notes surrendered upon such transfer or exchange.
(h) No Obligation of the Senior Subordinated Notes Trustee.
(i) The Senior Subordinated Notes Trustee shall have no
responsibility or obligation to any beneficial owner of a Global Senior
Subordinated Note, a member of, or a participant in the Depositary or any
other Person with respect to the accuracy of the records of the Depositary
or its nominee or of any participant or member thereof, with respect to
any ownership interest in the Senior Subordinated Notes or with respect to
the delivery to any participant, member, beneficial owner or other Person
(other than the Depositary) of any notice (including any notice of
redemption or repurchase) or the payment of any amount, under or with
respect to such Senior Subordinated Notes. All notices and communications
to be given to the Senior Subordinated Noteholders and all payments to be
made to Senior Subordinated Noteholders under the Senior Subordinated
Notes shall be given or made only to the registered Senior Subordinated
Noteholders (which shall be the Depositary or its nominee in the case of a
Global Senior Subordinated Note). The rights of beneficial owners in any
Global Senior Subordinated Note shall be exercised only through the
Depositary subject to the applicable rules and procedures of the
Depositary. The Senior Subordinated Notes Trustee may rely and shall be
fully protected in relying upon information furnished by the Depositary
with respect to its members, participants and any beneficial owners.
12
(ii) The Senior Subordinated Notes 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 Senior
Subordinated Note (including any transfers between or among Depositary
participants, members or beneficial owners in any Global Senior
Subordinated 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, the terms of this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
2.4 Definitive Senior Subordinated Notes
(a) A Global Senior Subordinated Note deposited with the Depositary
or with the Senior Subordinated Notes Trustee as Senior Subordinated Notes
Custodian pursuant to Section 2.1 shall be transferred to the beneficial owners
thereof in the form of Definitive Senior Subordinated Notes in an aggregate
principal amount equal to the principal amount of such Global Senior
Subordinated Note, in exchange for such Global Senior Subordinated Note, only if
such transfer complies with Section 2.3 and (i) the Depositary notifies the
Company that it is unwilling or unable to continue as a Depositary for such
Global Senior Subordinated Note or if at any time the Depositary ceases to be a
"clearing agency" registered under the Exchange Act, and a successor depositary
is not appointed by the Company within 90 days of such notice, or (ii) an Event
of Default has occurred and is continuing or (iii) the Company, in its sole
discretion, notifies the Senior Subordinated Notes Trustee in writing that it
elects to cause the issuance of certificated Senior Subordinated Notes under
this Indenture.
(b) Any Global Senior Subordinated Note that is transferable to the
beneficial owners thereof pursuant to this Section 2.4 shall be surrendered by
the Depositary to the Senior Subordinated Notes Trustee, to be so transferred,
in whole or from time to time in part, without charge, and the Senior
Subordinated Notes Trustee shall authenticate and deliver, upon such transfer of
each portion of such Global Senior Subordinated Note, an equal aggregate
principal amount of Definitive Senior Subordinated Notes of authorized
denominations. Any portion of a Global Senior Subordinated Note transferred
pursuant to this Section shall be executed, authenticated and delivered only in
denominations of $1,000 and any integral multiple thereof and registered in such
names as the Depositary shall direct. Any certificated Initial Senior
Subordinated Note in the form of a Definitive Senior Subordinated Note delivered
in exchange for an interest in the Global Senior Subordinated Note shall, except
as otherwise provided by Section 2.3(e), bear the Restricted Senior Subordinated
Notes Legend.
(c) Subject to the provisions of Section 2.4(b), the registered
Senior Subordinated Noteholder of a Global Senior Subordinated 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 Senior
Subordinated Noteholder is entitled to take under this Indenture or the Senior
Subordinated Notes.
(d) In the event of the occurrence of any of the events specified in
Section 2.4(a)(i), (ii) or (iii), the Company will promptly make available to
the Senior Subordinated Notes Trustee a reasonable supply of Definitive Senior
Subordinated Notes in fully registered form without interest coupons.
EXHIBIT A
[FORM OF FACE OF INITIAL SENIOR SUBORDINATED NOTE]
[Global Senior Subordinated Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Senior Subordinated Notes Legend]
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER
OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON
IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL
2
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE
ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT,
(E) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(A)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED
INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM
PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO
ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON
THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
Each Definitive Senior Subordinated Note will also bear the following additional
legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS."
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
No. $__________
9 1/8% Senior Subordinated Note due 2008
CUSIP No. ______
WESCO Distribution, Inc., a Delaware corporation, promises to pay to
Cede & Co., or registered assigns, the principal sum [of Dollars]
[listed on the Schedule of Increases or Decreases in Global Senior Subordinated
Note attached hereto](1) on June 1, 2008.
Interest Payment Dates: June 1 and December 1.
Record Dates: May 15 and November 15.
--------
(1) Use the Schedule of Increases and Decreases language if Note is in Global
Form.
2
Additional provisions of this Senior Subordinated Note are set forth
on the other side of this Senior Subordinated Note.
IN WITNESS WHEREOF, the parties have caused this instrument to be
duly executed.
WESCO DISTRIBUTION, INC.,
by
----------------------------
Name:
Title:
by
----------------------------
Name:
Title:
Dated:
SENIOR SUBORDINATED NOTES TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
BANK ONE, N.A.,
as Senior Subordinated Notes Trustee, certifies
that this is one of
the Senior Subordinated Notes referred
to in the Indenture.
By:
-------------------------
Authorized Signatory
[FORM OF REVERSE SIDE OF SENIOR SUBORDINATED NOTE]
9 1/8% Senior Subordinated Note due 2008
1. Interest
(a) WESCO DISTRIBUTION, INC., a Delaware corporation (such
corporation, and its successors and assigns under the Indenture hereinafter
referred to, being herein called the "Company"), promises to pay interest on the
principal amount of this Senior Subordinated Note at the rate per annum shown
above. The Company will pay interest semiannually on June 1 and December 1 of
each year. Interest on the Senior Subordinated Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from June 5, 1998. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
(b) Liquidated Damages. The holder of this Senior Subordinated Note
is entitled to the benefits of an Exchange and Registration Rights Agreement,
dated as of June 5, 1998, among the Company, WESCO International, Inc.
("Holdings") and the Initial Purchasers named therein (the "Senior Subordinated
Notes Registration Agreement"). Capitalized terms used in this paragraph (b) but
not defined herein have the meanings assigned to them in the Senior Subordinated
Notes Registration Agreement. If (i) the Senior Subordinated Notes Shelf
Registration Statement or Senior Subordinated Notes Exchange Offer Registration
Statement, as applicable under the Senior Subordinated Notes Registration
Agreement, is not filed with the Commission on or prior to 90 days after the
Senior Subordinated Notes Issue Date (or, in the case of a Senior Subordinated
Notes Shelf Registration Statement required to be filed in response to a change
in law or applicable interpretations of the Commission's staff, if later, within
45 days after publication of the change in law or interpretations, but in no
event before 90 days after the Senior Subordinated Notes Issue Date), (ii) the
Senior Subordinated Notes Exchange Offer Registration Statement or the Senior
Subordinated Notes Shelf Registration Statement, as the case may be, is not
declared effective within 200 days after the Senior Subordinated Notes Issue
Date (or in the case of a Senior Subordinated Notes Shelf Registration Statement
required to be filed in response to a change in law or the applicable
interpretations of Commission's staff, if later, within 90 days after
publication of the change in law or interpretation, but in no event before 200
days after the Senior Subordinated Notes Issue Date), (iii) the Senior
Subordinated Notes Registered Exchange Offer is not consummated on or prior to
230 days after the Senior Subordinated Notes Issue Date (other than in the event
the Company files a Senior Subordinated Notes Shelf Registration Statement), or
(iv) the Senior Subordinated Notes Shelf Registration Statement is filed and
declared effective within 200 days after the Senior Subordinated Notes Issue
Date but shall thereafter cease to be effective (at any time that the Company is
obligated to maintain the effectiveness thereof) without being succeeded within
90 days by an additional Senior Subordinated Notes Registration Statement filed
and declared effective (each such event referred to in clauses (i) through (iv),
a "Registration Default"), the Company shall pay liquidated damages to each
holder of Transfer Restricted Senior Subordinated Notes, during the period of
such Registration Default, in an amount equal to $0.192 per week per $1,000
principal amount of the Senior Subordinated Notes constituting Transfer
Restricted Senior Subordinated Notes held by such holder until (i) the
applicable Senior Subordinated Notes Registration Statement is filed, (ii) the
Senior Subordinated Notes Exchange Offer Registration Statement is declared
effective and the Senior Subordinated Notes Registered Exchange Offer is
consummated, (iii) the Senior
2
Subordinated Notes Shelf Registration Statement is declared effective or (iv)
the Senior Subordinated Notes Shelf Registration Statement again becomes
effective, as the case may be. All accrued liquidated damages shall be paid to
holders in the same manner as interest payments on the Senior Subordinated Notes
on semi-annual payment dates which correspond to interest payment dates for the
Senior Subordinated Notes. Following the cure of all Registration Defaults, the
accrual of liquidated damages will cease. The Senior Subordinated Notes Trustee
shall have no responsibility with respect to the determination of the amount of
any such liquidated damages. For purposes of the foregoing, "Transfer Restricted
Senior Subordinated Notes" means (i) each Initial Senior Subordinated Note until
the date on which such Initial Senior Subordinated Note has been exchanged for a
freely transferable Senior Subordinated Exchange Note in the Senior Subordinated
Notes Registered Exchange Offer, (ii) each Initial Senior Subordinated Note or
Private Senior Subordinated Exchange Note until the date on which such Initial
Senior Subordinated Note or Private Senior Subordinated Exchange Note has been
effectively registered under the Securities Act and disposed of in accordance
with a Senior Subordinated Notes Shelf Registration Statement or (iii) each
Initial Senior Subordinated Note or Private Senior Subordinated Exchange Note
until the date on which such Initial Senior Subordinated Note or Private Senior
Subordinated Exchange Note is distributed to the public pursuant to Rule 144
under the Securities Act or is saleable pursuant to Rule 144(k) under the
Securities Act.
2. Method of Payment
The Company will pay interest on the Senior Subordinated Notes
(except defaulted interest) to the Persons who are registered holders of Senior
Subordinated Notes at the close of business on the May 15 or November 15 next
preceding the interest payment date even if Senior Subordinated Notes are
canceled after the record date and on or before the interest payment date.
Holders must surrender Senior Subordinated Notes to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States of America that at the time of payment is legal tender for payment
of public and private debts. Payments in respect of the Senior Subordinated
Notes represented by a Global Senior Subordinated Note (including principal,
premium and interest) will be made by wire transfer of immediately available
funds to the accounts specified by The Depository Trust Company. The Company
will make all payments in respect of a certificated Senior Subordinated Note
(including principal, premium and interest), by mailing a check to the
registered address of each Senior Subordinated Noteholder thereof; provided,
however, that payments on the Senior Subordinated Notes may also be made, in the
case of a Senior Subordinated Noteholder of at least $1,000,000 aggregate
principal amount of Senior Subordinated Notes, by wire transfer to a U.S. dollar
account maintained by the payee with a bank in the United States if such Senior
Subordinated Noteholder elects payment by wire transfer by giving written notice
to the Senior Subordinated Notes Trustee or the Paying Agent to such effect
designating such account no later than 30 days immediately preceding the
relevant due date for payment (or such other date as the Senior Subordinated
Notes Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, Bank One, N.A., a national banking association (the
"Senior Subordinated Notes Trustee"), will act as Paying Agent and Registrar.
The Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
3
4. Indenture
The Company issued the Senior Subordinated Notes under an Indenture
dated as of June 5, 1998 (the "Indenture"), among the Company, Holdings and the
Senior Subordinated Notes Trustee. The terms of the Senior Subordinated Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S.C. xx.xx. 77aaa-77bbbb) as
in effect on the date of the Indenture (the "TIA"). Terms defined in the
Indenture and not defined herein have the meanings ascribed thereto in the
Indenture. The Senior Subordinated Notes are subject to all such terms, and
Senior Subordinated Noteholders are referred to the Indenture and the TIA for a
statement of those terms.
The Senior Subordinated Notes are senior subordinated unsecured
obligations of the Company limited to $500 million aggregate principal amount at
any one time outstanding (subject to Sections 2.01 and 2.08 of the Indenture).
This Senior Subordinated Note is one of the Original Senior Subordinated Notes
referred to in the Indenture issued in an aggregate principal amount of $300
million. The Senior Subordinated Notes include the Initial Senior Subordinated
Notes and any Senior Subordinated Exchange Notes issued in exchange for Initial
Senior Subordinated Notes. The Initial Senior Subordinated Notes and the Senior
Subordinated Exchange Notes are treated as a single class of securities under
the Indenture. The Indenture imposes certain limitations on the ability of the
Company and its Restricted Subsidiaries to, among other things, make certain
Investments and other Restricted Payments, pay dividends and other
distributions, incur Indebtedness, enter into consensual restrictions upon the
payment of certain dividends and distributions by such Restricted Subsidiaries,
issue or sell shares of capital stock of such Restricted Subsidiaries, enter
into or permit certain transactions with Affiliates, create or incur Liens and
make asset sales. The Indenture also imposes limitations on the ability of the
Company to consolidate or merge with or into any other Person or convey,
transfer or lease all or substantially all of the property of the Company.
To guarantee the due and punctual payment of the principal and
interest on the Senior Subordinated Notes and all other amounts payable by the
Company under the Indenture and the Senior Subordinated Notes when and as the
same shall be due and payable, whether at maturity, by acceleration or
otherwise, according to the terms of the Senior Subordinated Notes and the
Indenture, Holdings has unconditionally guaranteed the Guaranteed Obligations on
a senior subordinated basis pursuant to the terms of the Indenture.
5. Optional Redemption
Except as set forth in the following two paragraphs, the Senior
Subordinated Notes will not be redeemable at the option of the Company prior to
June 1, 2003. Thereafter, the Senior Subordinated Notes will be redeemable at
the option of the Company, in whole or in part, on not less than 30 nor more
than 60 days' prior notice, at the following redemption prices (expressed as
percentages of principal amount), plus accrued and unpaid interest and
liquidated damages (if any) to the redemption date (subject to the right of
holders of record on the relevant record date to receive interest due on the
relevant interest payment date), if redeemed during the 12-month period
commencing on June 1 of the years set forth below:
Redemption
Year Price
---- ----------
2003............................................................. 104.563%
2004............................................................. 103.042%
2005............................................................. 101.521%
2006 and thereafter.............................................. 100.000%
4
In addition, at any time and from time to time prior to June 1,
2001, the Company may redeem up to a maximum of 35% of the original aggregate
principal amount of the Senior Subordinated Notes (calculated giving effect to
any issuance of Additional Senior Subordinated Notes) with the Net Cash Proceeds
of one or more Equity Offerings by (i) the Company or (ii) Holdings to the
extent the Net Cash Proceeds thereof are (a) contributed to the Company as a
capital contribution to the common equity of the Company or (b) used to purchase
Capital Stock of the Company (in either case, other than Disqualified Stock), at
a redemption price equal to 109.125% of the principal amount thereof, plus
accrued and unpaid interest and liquidated damages thereon, if any, to the
redemption date (subject to the right of holders of record on the relevant
record date to receive interest due on the relevant interest payment date);
provided, however, that after giving effect to any such redemption, at least 65%
of the original aggregate principal amount of the Senior Subordinated Notes
(calculated giving effect to any issuance of Additional Senior Subordinated
Notes) remains outstanding. Any such redemption shall be made within 120 days of
such Equity Offering upon not less than 30 nor more than 60 days' notice mailed
to each holder of Senior Subordinated Notes being redeemed and otherwise in
accordance with the procedures set forth in the Indenture.
At any time prior to June 1, 2003, the Senior Subordinated Notes may
be redeemed, in whole but not in part, at the option of the Company at any time
within 180 days after a Change of Control, at a redemption price equal to the
sum of (i) the principal amount thereof plus (ii) accrued and unpaid interest
and liquidated damages, if any, to the redemption date (subject to the right of
Senior Subordinated Noteholders of record on the relevant record date to receive
interest due on the relevant interest payment date that is on or prior to the
date of redemption) plus (iii) the Applicable Premium.
6. Sinking Fund
The Senior Subordinated Notes are not subject to any sinking fund.
7. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Senior
Subordinated Noteholder of Senior Subordinated Notes to be redeemed at his or
her registered address. Senior Subordinated Notes in denominations larger than
$1,000 may be redeemed in part but only in whole multiples of $1,000. If money
sufficient to pay the redemption price of and accrued interest on all Senior
Subordinated Notes (or portions thereof) to be redeemed on the redemption date
is deposited with the Paying Agent on or before the redemption date and certain
other conditions are satisfied, on and after such date interest ceases to accrue
on such Senior Subordinated Notes (or such portions thereof) called for
redemption.
5
8. Repurchase of Senior Subordinated Notes at the Option of Senior
Subordinated Noteholders upon Change of Control
Upon a Change of Control, any Senior Subordinated Noteholder of
Senior Subordinated Notes will have the right, subject to certain conditions
specified in the Indenture, to cause the Company to repurchase all or any part
of the Senior Subordinated Notes of such Senior Subordinated Noteholder at a
purchase price equal to 101% of the principal amount of the Senior Subordinated
Notes to be repurchased plus accrued and unpaid interest and liquidated damages,
if any, to the date of repurchase (subject to the right of Senior Subordinated
Noteholders of record on the relevant record date to receive interest due on the
relevant interest payment date) as provided in, and subject to the terms of, the
Indenture.
9. Subordination
The Senior Subordinated Notes are subordinated to Senior
Indebtedness of the Company, as defined in the Indenture. To the extent provided
in the Indenture, Senior Indebtedness of the Company must be paid before the
Senior Subordinated Notes may be paid. The Company and Holdings agrees, and each
Senior Subordinated Noteholder by accepting a Senior Subordinated Note agrees,
to the subordination provisions contained in the Indenture and authorizes the
Senior Subordinated Notes Trustee to give it effect and appoints the Senior
Subordinated Notes Trustee as attorney-in-fact for such purpose.
10. Denominations; Transfer; Exchange
The Senior Subordinated Notes are in registered form without coupons
in denominations of $1,000 and whole multiples of $1,000. A Senior Subordinated
Noteholder may transfer or exchange Senior Subordinated Notes in accordance with
the Indenture. Upon any transfer or exchange, the Registrar and the Senior
Subordinated Notes Trustee may require a Senior Subordinated Noteholder, among
other things, to furnish appropriate endorsements or transfer documents and to
pay any taxes required by law or permitted by the Indenture. The Registrar need
not register the transfer of or exchange any Senior Subordinated Notes selected
for redemption (except, in the case of a Senior Subordinated Note to be redeemed
in part, the portion of the Senior Subordinated Note not to be redeemed) or to
transfer or exchange any Senior Subordinated Notes for a period of 15 days prior
to a selection of Senior Subordinated Notes to be redeemed.
11. Persons Deemed Owners
The registered Senior Subordinated Noteholder of this Senior
Subordinated Note may be treated as the owner of it for all purposes.
12. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Senior Subordinated Notes Trustee or Paying Agent shall pay
the money back to the Company at its written request unless an abandoned
property law designates another Person. After any such payment, Senior
Subordinated Noteholders entitled to the money must look only to the Company and
not to the Senior Subordinated Notes Trustee for payment.
6
13. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Senior Subordinated Notes and the
Indenture if the Company deposits with the Senior Subordinated Notes Trustee
money or U.S. Government Obligations for the payment of principal and interest
on the Senior Subordinated Notes to redemption or maturity, as the case may be.
14. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Senior Subordinated Notes may be amended without prior notice
to any Senior Subordinated Noteholder but with the written consent of the Senior
Subordinated Noteholders of at least a majority in aggregate principal amount of
the outstanding Senior Subordinated Notes and (ii) any default or noncompliance
with any provision may be waived with the written consent of the Senior
Subordinated Noteholders of at least a majority in principal amount of the
outstanding Senior Subordinated Notes. Subject to certain exceptions set forth
in the Indenture, without the consent of any Senior Subordinated Noteholder of
Senior Subordinated Notes, the Company and the Senior Subordinated Notes Trustee
may amend the Indenture or the Senior Subordinated Notes (i) to cure any
ambiguity, omission, defect or inconsistency; (ii) to comply with Article 5 of
the Indenture; (iii) to provide for uncertificated Senior Subordinated Notes in
addition to or in place of certificated Senior Subordinated Notes; (iv) to add
additional Guarantees with respect to the Senior Subordinated Notes; (v) to
secure the Senior Subordinated Notes; (vi) to add additional covenants of the
Company for the benefit of the Senior Subordinated Noteholders or to surrender
rights and powers conferred on the Company; (vii) to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the TIA; (viii) to make any change that does not adversely
affect the rights of any Senior Subordinated Noteholder; (ix) to make any change
in the subordination provisions of the Indenture that would limit or terminate
the benefits available to any holder of Senior Indebtedness of the Company (or
any representative thereof) under such subordination provisions; or (x) to
provide for the issuance of the Senior Subordinated Exchange Notes, Private
Senior Subordinated Exchange Notes, or Additional Senior Subordinated Notes.
15. Defaults and Remedies
If an Event of Default occurs (other than an Event of Default
relating to certain events of bankruptcy, insolvency or reorganization of the
Company) and is continuing, the Senior Subordinated Notes Trustee or the Senior
Subordinated Noteholders of at least 25% in principal amount of the outstanding
Senior Subordinated Notes may declare the principal of and accrued but unpaid
interest on all the Senior Subordinated Notes to be due and payable. If an Event
of Default relating to certain events of bankruptcy, insolvency or
reorganization of the Company occurs, the principal of and interest on all the
Senior Subordinated Notes will become immediately due and payable without any
declaration or other act on the part of the Senior Subordinated Notes Trustee or
any Senior Subordinated Noteholders. Under certain circumstances, the Senior
Subordinated Noteholders of a majority in principal amount of the outstanding
Senior Subordinated Notes may rescind any such acceleration with respect to the
Senior Subordinated Notes and its consequences.
7
If an Event of Default occurs and is continuing, the Senior
Subordinated Notes Trustee will be under no obligation to exercise any of the
rights or powers under the Indenture at the request or direction of any of the
Senior Subordinated Noteholders unless such Senior Subordinated Noteholders have
offered to the Senior Subordinated Notes Trustee reasonable indemnity or
security against any loss, liability or expense. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Senior
Subordinated Noteholder may pursue any remedy with respect to the Indenture or
the Senior Subordinated Notes unless (i) such Senior Subordinated Noteholder has
previously given the Senior Subordinated Notes Trustee notice that an Event of
Default is continuing, (ii) Senior Subordinated Noteholders of at least 25% in
principal amount of the outstanding Senior Subordinated Notes have requested the
Senior Subordinated Notes Trustee in writing to pursue the remedy, (iii) such
Senior Subordinated Noteholders have offered the Senior Subordinated Notes
Trustee reasonable security or indemnity against any loss, liability or expense,
(iv) the Senior Subordinated Notes Trustee has not complied with such request
within 60 days after the receipt of the request and the offer of security or
indemnity and (v) the Senior Subordinated Noteholders of a majority in principal
amount of the outstanding Senior Subordinated Notes have not given the Senior
Subordinated Notes Trustee a direction inconsistent with such request within
such 60-day period. Subject to certain restrictions, the Senior Subordinated
Noteholders of a majority in principal amount of the outstanding Senior
Subordinated Notes are given the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Senior Subordinated
Notes Trustee or of exercising any trust or power conferred on the Senior
Subordinated Notes Trustee. The Senior Subordinated Notes Trustee, however, may
refuse to follow any direction that conflicts with law or the Indenture or that
the Senior Subordinated Notes Trustee determines is unduly prejudicial to the
rights of any other Senior Subordinated Noteholder or that would involve the
Senior Subordinated Notes Trustee in personal liability. Prior to taking any
action under the Indenture, the Senior Subordinated Notes Trustee will be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
16. Senior Subordinated Notes Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA, the Senior
Subordinated Notes Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Senior Subordinated Notes and may
otherwise deal with and collect obligations owed to it by the Company or its
Affiliates and may otherwise deal with the Company or its Affiliates with the
same rights it would have if it were not Senior Subordinated Notes Trustee.
17. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company or Holdings shall not have any liability for any obligations of the
Company under the Senior Subordinated Notes or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By
accepting a Senior Subordinated Note, each Senior Subordinated Noteholder waives
and releases all such liability. The waiver and release are part of the
consideration for the issue of the Senior Subordinated Notes.
8
18. Authentication
This Senior Subordinated Note shall not be valid until an authorized
signatory of the Senior Subordinated Notes Trustee (or an authenticating agent)
manually signs the certificate of authentication on the other side of this
Senior Subordinated Note.
19. Abbreviations
Customary abbreviations may be used in the name of a Senior
Subordinated Noteholder or an assignee, such as TEN COM (=tenants in common),
TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of
survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A
(=Uniform Gift to Minors Act).
20. GOVERNING LAW
THIS SENIOR SUBORDINATED NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
21. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Senior Subordinated Notes and has directed the Senior
Subordinated Notes Trustee to use CUSIP numbers in notices of redemption as a
convenience to Senior Subordinated Noteholders. No representation is made as to
the accuracy of such numbers either as printed on the Senior Subordinated Notes
or as contained in any notice of redemption and reliance may be placed only on
the other identification numbers placed thereon.
The Company will furnish to any Senior Subordinated Noteholder of
Senior Subordinated Notes upon written request and without charge to the Senior
Subordinated Noteholder a copy of the Indenture which has in it the text of this
Senior Subordinated Note.
ASSIGNMENT FORM
To assign this Senior Subordinated Note, fill in the form below:
I or we assign and transfer this Senior Subordinated Note to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Senior
Subordinated Note on the books of the Company. The agent may substitute another
to act for him.
____________________________________________________________
Date: ________________ Your Signature: _____________________
____________________________________________________________
Sign exactly as your name appears on the other side of this Senior Subordinated
Note.
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF
TRANSFER RESTRICTED SENIOR SUBORDINATED NOTES
This certificate relates to $_________ principal amount of Senior Subordinated
Notes held in (check applicable space) ____ book-entry or _____ definitive form
by the undersigned.
The undersigned (check one box below):
|_| has requested the Senior Subordinated Notes Trustee by written order to
deliver in exchange for its beneficial interest in the Global Senior
Subordinated Note held by the Depositary a Senior Subordinated Note or
Senior Subordinated Notes in definitive, registered form of authorized
denominations and an aggregate principal amount equal to its beneficial
interest in such Global Senior Subordinated Note (or the portion thereof
indicated above);
|_| has requested the Senior Subordinated Notes Trustee by written order to
exchange or register the transfer of a Senior Subordinated Note or Senior
Subordinated Notes.
In connection with any transfer of any of the Senior Subordinated Notes
evidenced by this certificate occurring prior to the expiration of the period
referred to in Rule 144(k) under the Securities Act, the undersigned confirms
that such Senior Subordinated Notes are being transferred in accordance with its
terms:
CHECK ONE BOX BELOW
(1) |_| to the Company; or
(2) |_| pursuant to an effective registration statement under the
Securities Act of 1933; or
(3) |_| inside the United States to a "qualified institutional buyer"
(as defined in Rule 144A under the Securities Act of 1933)
that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that
such transfer is being made in reliance on Rule 144A, in each
case pursuant to and in compliance with Rule 144A under the
Securities Act of 1933; or
(4) |_| outside the United States in an offshore transaction within
the meaning of Regulation S under the Securities Act in
compliance with Rule 904 under the Securities Act of 1933; or
(5) |_| to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933)
that has furnished to the Senior Subordinated Notes Trustee a
signed letter containing certain representations and
agreements; or
(6) |_| pursuant to another available exemption from registration
provided by Rule 144 under the Securities Act of 1933.
2
Unless one of the boxes is checked, the Senior Subordinated Notes Trustee
will refuse to register any of the Senior Subordinated Notes evidenced by
this certificate in the name of any Person other than the registered
holder thereof; provided, however, that if box (4), (5) or (6) is checked,
the Senior Subordinated Notes Trustee may require, prior to registering
any such transfer of the Senior Subordinated Notes, such legal opinions,
certifications and other information as the Company has reasonably
requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933.
________________________
Your Signature
Signature Guarantee:
Date: ___________________ ________________________
Signature must be guaranteed Signature of Signature
by a participant in a Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Senior Subordinated Notes Trustee
____________________________________________________________
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Senior Subordinated 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
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Dated: ________________ ______________________________
NOTICE: To be executed by
an executive officer
[TO BE ATTACHED TO GLOBAL SENIOR SUBORDINATED NOTES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SENIOR
SUBORDINATED NOTE
The initial principal amount of this Global Senior Subordinated Note
is $[ ]. The following increases or decreases in this Global Senior
Subordinated Note have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of authorized
Exchange Principal Amount of this Principal Amount of this Global Senior Subordinated signatory of Senior
Global Senior Subordinated Global Senior Subordinated Note following such Subordinated Notes Trustee
Note Note decrease or increase or Senior Subordinated
Notes Custodian
OPTION OF SENIOR SUBORDINATED NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Subordinated Note purchased
by the Company pursuant to Section 4.06 (Asset Sale) or 4.08 (Change of Control)
of the Indenture, check the box:
Asset Sale |_| Change of Control |_|
If you want to elect to have only part of this Senior Subordinated
Note purchased by the Company pursuant to Section 4.06 or 4.08 of the Indenture,
state the amount:
$
Date: __________________ Your Signature: __________________
(Sign exactly as your name appears on the other side of the Senior Subordinated
Note)
Signature Guarantee:_______________________________________
Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other
signature guarantor acceptable to the Senior
Subordinated Notes Trustee
EXHIBIT B
[FORM OF FACE OF SENIOR SUBORDINATED EXCHANGE NOTE]
No. $__________
9 1/8% Senior Subordinated Note due 2008
CUSIP No. ______
WESCO Distribution, Inc., a Delaware corporation, promises to pay to
Cede & Co., or registered assigns, the principal sum [of Dollars]
[listed on the Schedule of Increases or Decreases in Global Senior Subordinated
Note attached hereto](2) on June 1, 2008.
Interest Payment Dates: June 1 and December 1.
Record Dates: May 15 and November 15.
--------
(2) Use the Schedule of Increases and Decreases language if Note is in Global
Form.
2
Additional provisions of this Senior Subordinated Note are set forth
on the other side of this Senior Subordinated Note.
IN WITNESS WHEREOF, the parties have caused this instrument to be
duly executed.
WESCO DISTRIBUTION, INC.,
by
--------------------------
Name:
Title:
by
--------------------------
Name:
Title:
Dated:
SENIOR SUBORDINATED NOTES TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
BANK ONE, N.A.,
as Senior Subordinated Notes Trustee, certifies
that this is one of
the Senior Subordinated Notes referred
to in the Indenture.
by
-----------------------------
Authorized Signatory
----------
*/ If the Senior Subordinated Note is to be issued in global form, add the
Global Senior Subordinated Notes Legend and the attachment from Exhibit A
captioned "TO BE ATTACHED TO GLOBAL SENIOR SUBORDINATED NOTES - SCHEDULE OF
INCREASES OR DECREASES IN GLOBAL SENIOR SUBORDINATED NOTE".
[FORM OF REVERSE SIDE OF SENIOR SUBORDINATED EXCHANGE NOTE]
9 1/8% Senior Subordinated Note due 2008
1. Interest.
WESCO DISTRIBUTION, INC., a Delaware corporation (such corporation,
and its successors and assigns under the Indenture hereinafter referred to,
being herein called the "Company"), promises to pay interest on the principal
amount of this Senior Subordinated Note at the rate per annum shown above. The
Company will pay interest semiannually on June 1 and December 1 of each year.
Interest on the Senior Subordinated Notes will accrue from the most recent date
to which interest has been paid or, if no interest has been paid, from June 5,
1998. Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
2. Method of Payment
The Company will pay interest on the Senior Subordinated Notes
(except defaulted interest) to the Persons who are registered holders of Senior
Subordinated Notes at the close of business on the May 15 or November 15 next
preceding the interest payment date even if Senior Subordinated Notes are
canceled after the record date and on or before the interest payment date.
Senior Subordinated Noteholders must surrender Senior Subordinated Notes to a
Paying Agent to collect principal payments. The Company will pay principal and
interest in money of the United States of America that at the time of payment is
legal tender for payment of public and private debts. Payments in respect of the
Senior Subordinated Notes represented by a Global Senior Subordinated Note
(including principal, premium and interest) will be made by wire transfer of
immediately available funds to the accounts specified by The Depository Trust
Company. The Company will make all payments in respect of a certificated Senior
Subordinated Note (including principal, premium and interest), by mailing a
check to the registered address of each Senior Subordinated Noteholder thereof;
provided, however, that payments on the Senior Subordinated Notes may also be
made, in the case of a Senior Subordinated Noteholder of at least $1,000,000
aggregate principal amount of Senior Subordinated Notes, by wire transfer to a
U.S. dollar account maintained by the payee with a bank in the United States if
such Senior Subordinated Noteholder elects payment by wire transfer by giving
written notice to the Senior Subordinated Notes Trustee or the Paying Agent to
such effect designating such account no later than 30 days immediately preceding
the relevant due date for payment (or such other date as the Senior Subordinated
Notes Trustee may accept in its discretion).
3. Paying Agent and Registrar
Initially, Bank One, N.A., a national banking association (the
"Senior Subordinated Notes Trustee"), will act as Paying Agent and Registrar.
The Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice. The Company or any of its domestically incorporated Wholly Owned
Subsidiaries may act as Paying Agent, Registrar or co-registrar.
2
4. Indenture
The Company issued the Senior Subordinated Notes under an Indenture
dated as of June 5, 1998 (the "Indenture"), among the Company, Holdings and the
Senior Subordinated Notes Trustee. The terms of the Senior Subordinated Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S.C. xx.xx. 77aaa-77bbbb) as
in effect on the date of the Indenture (the "TIA"). Terms defined in the
Indenture and not defined herein have the meanings ascribed thereto in the
Indenture. The Senior Subordinated Notes are subject to all such terms, and
Senior Subordinated Noteholders are referred to the Indenture and the TIA for a
statement of those terms.
The Senior Subordinated Notes are senior subordinated unsecured
obligations of the Company limited to $500 million aggregate principal amount at
any one time outstanding, of which $300 million in aggregate principal amount
will be initially issued on the Closing Date. Subject to the conditions set
forth in the Indenture, the Company may issue up to an additional $200 million
aggregate principal amount of Additional Senior Subordinated Notes. This Senior
Subordinated Note is one of the Initial Senior Subordinated Notes referred to in
the Indenture. The Senior Subordinated Notes include the Original Senior
Subordinated Notes, the Additional Senior Subordinated Notes and any Senior
Subordinated Exchange Notes and Private Senior Subordinated Exchange Notes
issued in exchange for the Initial Senior Subordinated Notes pursuant to the
Indenture. The Original Senior Subordinated Notes, the Additional Senior
Subordinated Notes, the Senior Subordinated Exchange Notes and the Private
Senior Subordinated Exchange Notes are treated as a single class of securities
under the Indenture. The Indenture imposes certain limitations on the ability of
the Company and its Restricted Subsidiaries to, among other things, make certain
Investments and other Restricted Payments, pay dividends and other
distributions, incur Indebtedness, enter into consensual restrictions upon the
payment of certain dividends and distributions by such Restricted Subsidiaries,
issue or sell shares of capital stock of such Restricted Subsidiaries, enter
into or permit certain transactions with Affiliates, create or incur Liens and
make Asset Sales. The Indenture also imposes limitations on the ability of the
Company to consolidate or merge with or into any other Person or convey,
transfer or lease all or substantially all of the property of the Company.
To guarantee the due and punctual payment of the principal and
interest, if any, on the Senior Subordinated Notes and all other amounts payable
by the Company under the Indenture and the Senior Subordinated Notes when and as
the same shall be due and payable, whether at maturity, by acceleration or
otherwise, according to the terms of the Senior Subordinated Notes and the
Indenture, Holdings has unconditionally guaranteed the Guaranteed Obligations on
a senior subordinated basis pursuant to the terms of the Indenture.
5. Optional Redemption
Except as set forth in the following two paragraphs, the Senior
Subordinated Notes will not be redeemable at the option of the Company prior to
June 1, 2003. Thereafter, the Senior Subordinated Notes will be redeemable at
the option of the Company, in whole or in part, on not less than 30 nor more
than 60 days' prior notice, at the following redemption prices (expressed as
percentages of principal amount), plus accrued and unpaid interest and
liquidated damages (if any) to the redemption date (subject to the right of
holders of record on the relevant record date to receive interest due on the
relevant interest
3
payment date), if redeemed during the 12-month period commencing on June 1 of
the years set forth below:
Redemption
Year Price
---- ----------
2003................................................................ 104.563%
2004................................................................ 103.042%
2005................................................................ 101.521%
2006 and thereafter................................................. 100.000%
In addition, at any time and from time to time prior to June 1,
2001, the Company may redeem up to a maximum of 35% of the original aggregate
principal amount of the Senior Subordinated Notes (calculated giving effect to
any issuance of Additional Senior Subordinated Notes) with the Net Cash Proceeds
of one or more Equity Offerings by (i) the Company or (ii) Holdings to the
extent the Net Cash Proceeds thereof are (a) contributed to the Company as a
capital contribution to the common equity of the Company or (b) used to purchase
Capital Stock of the Company (in either case, other than Disqualified Stock), at
a redemption price equal to 109.125% of the principal amount thereof, plus
accrued and unpaid interest and liquidated damages thereon, if any, to the
redemption date (subject to the right of holders of record on the relevant
record date to receive interest due on the relevant interest payment date);
provided, however, that after giving effect to any such redemption, at least 65%
of the original aggregate principal amount of the Senior Subordinated Notes
(calculated giving effect to any issuance of Additional Senior Subordinated
Notes) remains outstanding. Any such redemption shall be made within 120 days of
such Equity Offering upon not less than 30 nor more than 60 days' notice mailed
to each holder of Senior Subordinated Notes being redeemed and otherwise in
accordance with the procedures set forth in the Indenture.
At any time prior to June 1, 2003, the Senior Subordinated Notes may
be redeemed, in whole but not in part, at the option of the Company at any time
within 180 days after a Change of Control, at a redemption price equal to the
sum of (i) the principal amount thereof plus (ii) accrued and unpaid interest
and liquidated damages, if any, to the redemption date (subject to the right of
Senior Subordinated Noteholders of record on the relevant record date to receive
interest due on the relevant interest payment date that is on or prior to the
date of redemption) plus (iii) the Applicable Premium.
6. Sinking Fund
The Senior Subordinated Notes are not subject to any sinking fund.
7. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Senior
Subordinated Noteholder of Senior Subordinated Notes to be redeemed at his or
her registered address. Senior Subordinated Notes in denominations larger than
$1,000 may be redeemed in part but only in whole multiples of $1,000. If money
sufficient to pay the redemption price of and accrued interest on all Senior
Subordinated Notes (or portions thereof) to be redeemed on the redemption date
is deposited with the Paying Agent on or before the redemption date and
4
certain other conditions are satisfied, on and after such date interest ceases
to accrue on such Senior Subordinated Notes (or such portions thereof) called
for redemption.
8. Repurchase of Senior Subordinated Notes at the Option of Senior
Subordinated Noteholders upon Change of Control
Upon a Change of Control, any Senior Subordinated Noteholder of
Senior Subordinated Notes will have the right, subject to certain conditions
specified in the Indenture, to cause the Company to repurchase all or any part
of the Senior Subordinated Notes of such Senior Subordinated Noteholder at a
purchase price equal to 101% of the principal amount of the Senior Subordinated
Notes to be repurchased plus accrued and unpaid interest and liquidated damages,
if any, to the date of repurchase (subject to the right of Senior Subordinated
Noteholders of record on the relevant record date to receive interest due on the
relevant interest payment date) as provided in, and subject to the terms of, the
Indenture.
9. Subordination
The Senior Subordinated Notes are subordinated to Senior
Indebtedness of the Company, as defined in the Indenture. To the extent provided
in the Indenture, Senior Indebtedness of the Company must be paid before the
Senior Subordinated Notes may be paid. The Company and Holdings agrees, and each
Senior Subordinated Noteholder by accepting a Senior Subordinated Note agrees,
to the subordination provisions contained in the Indenture and authorizes the
Senior Subordinated Notes Trustee to give it effect and appoints the Senior
Subordinated Notes Trustee as attorney-in-fact for such purpose.
10. Denominations; Transfer; Exchange
The Senior Subordinated Notes are in registered form without coupons
in denominations of $1,000 and whole multiples of $1,000. A Senior Subordinated
Noteholder may transfer or exchange Senior Subordinated Notes in accordance with
the Indenture. Upon any transfer or exchange, the Registrar and the Senior
Subordinated Notes Trustee may require a Senior Subordinated Noteholder, among
other things, to furnish appropriate endorsements or transfer documents and to
pay any taxes required by law or permitted by the Indenture. The Registrar need
not register the transfer of or exchange any Senior Subordinated Notes selected
for redemption (except, in the case of a Senior Subordinated Note to be redeemed
in part, the portion of the Senior Subordinated Note not to be redeemed) or to
transfer or exchange any Senior Subordinated Notes for a period of 15 days prior
to a selection of Senior Subordinated Notes to be redeemed or 15 days before an
interest payment date.
11. Persons Deemed Owners
The registered Senior Subordinated Noteholder of this Senior
Subordinated Note may be treated as the owner of it for all purposes.
12. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Senior Subordinated Notes Trustee or Paying Agent shall pay
the money back to
5
the Company at its written request unless an abandoned property law designates
another Person. After any such payment, Senior Subordinated Noteholders entitled
to the money must look only to the Company and not to the Senior Subordinated
Notes Trustee for payment.
13. Discharge and Defeasance
Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Senior Subordinated Notes and the
Indenture if the Company deposits with the Senior Subordinated Notes Trustee
money or U.S. Government Obligations for the payment of principal and interest
on the Senior Subordinated Notes to redemption or maturity, as the case may be.
14. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Senior Subordinated Notes may be amended without prior notice
to any Senior Subordinated Noteholder but with the written consent of the Senior
Subordinated Noteholders of at least a majority in aggregate principal amount of
the outstanding Senior Subordinated Notes and (ii) any default or noncompliance
with any provision may be waived with the written consent of the Senior
Subordinated Noteholders of at least a majority in principal amount of the
outstanding Senior Subordinated Notes. Subject to certain exceptions set forth
in the Indenture, without the consent of any Senior Subordinated Noteholder of
Senior Subordinated Notes, the Company and the Senior Subordinated Notes Trustee
may amend the Indenture or the Senior Subordinated Notes (i) to cure any
ambiguity, omission, defect or inconsistency; (ii) to comply with Article 5 of
the Indenture; (iii) to provide for uncertificated Senior Subordinated Notes in
addition to or in place of certificated Senior Subordinated Notes; (iv) to add
additional Guarantees with respect to the Senior Subordinated Notes; (v) to
secure the Senior Subordinated Notes; (vi) to add additional covenants of the
Company for the benefit of the Senior Subordinated Noteholders or to surrender
rights and powers conferred on the Company; (vii) to comply with the
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the TIA; (viii) to make any change that does not adversely
affect the rights of any Senior Subordinated Noteholder; (ix) to make any change
in the subordination provisions of the Indenture that would limit or terminate
the benefits available to any holder of Senior Indebtedness of the Company (or
any representative thereof) under such subordination provisions; or (x) to
provide for the issuance of the Senior Subordinated Exchange Notes, Private
Senior Subordinated Exchange Notes, or Additional Senior Subordinated Notes.
15. Defaults and Remedies
If an Event of Default occurs (other than an Event of Default
relating to certain events of bankruptcy, insolvency or reorganization of the
Company) and is continuing, the Senior Subordinated Notes Trustee or the Senior
Subordinated Noteholders of at least 25% in principal amount of the outstanding
Senior Subordinated Notes may declare the principal of and accrued but unpaid
interest on all the Senior Subordinated Notes to be due and payable. If an Event
of Default relating to certain events of bankruptcy, insolvency or
reorganization of the Company occurs, the principal of and interest on all the
Senior Subordinated Notes will become immediately due and payable without any
declaration or other act on the part of the Senior Subordinated Notes Trustee or
any Senior Subordinated Noteholders. Under certain circumstances, the Senior
Subordinated
6
Noteholders of a majority in principal amount of the outstanding Senior
Subordinated Notes may rescind any such acceleration with respect to the Senior
Subordinated Notes and its consequences.
If an Event of Default occurs and is continuing, the Senior
Subordinated Notes Trustee will be under no obligation to exercise any of the
rights or powers under the Indenture at the request or direction of any of the
Senior Subordinated Noteholders unless such Senior Subordinated Noteholders have
offered to the Senior Subordinated Notes Trustee reasonable indemnity or
security against any loss, liability or expense. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Senior
Subordinated Noteholder may pursue any remedy with respect to the Indenture or
the Senior Subordinated Notes unless (i) such Senior Subordinated Noteholder has
previously given the Senior Subordinated Notes Trustee notice that an Event of
Default is continuing, (ii) Senior Subordinated Noteholders of at least 25% in
principal amount of the outstanding Senior Subordinated Notes have requested the
Senior Subordinated Notes Trustee in writing to pursue the remedy, (iii) such
Senior Subordinated Noteholders have offered the Senior Subordinated Notes
Trustee reasonable security or indemnity against any loss, liability or expense,
(iv) the Senior Subordinated Notes Trustee has not complied with such request
within 60 days after the receipt of the request and the offer of security or
indemnity and (v) the Senior Subordinated Noteholders of a majority in principal
amount of the outstanding Senior Subordinated Notes have not given the Senior
Subordinated Notes Trustee a direction inconsistent with such request within
such 60-day period. Subject to certain restrictions, the Senior Subordinated
Noteholders of a majority in principal amount of the outstanding Senior
Subordinated Notes are given the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Senior Subordinated
Notes Trustee or of exercising any trust or power conferred on the Senior
Subordinated Notes Trustee. The Senior Subordinated Notes Trustee, however, may
refuse to follow any direction that conflicts with law or the Indenture or that
the Senior Subordinated Notes Trustee determines is unduly prejudicial to the
rights of any other Senior Subordinated Noteholder or that would involve the
Senior Subordinated Notes Trustee in personal liability. Prior to taking any
action under the Indenture, the Senior Subordinated Notes Trustee will be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
16. Senior Subordinated Notes Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA, the Senior
Subordinated Notes Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Senior Subordinated Notes and may
otherwise deal with and collect obligations owed to it by the Company or its
Affiliates and may otherwise deal with the Company or its Affiliates with the
same rights it would have if it were not Senior Subordinated Notes Trustee.
7
17. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company or Holdings shall not have any liability for any obligations of the
Company under the Senior Subordinated Notes or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By
accepting a Senior Subordinated Note, each Senior Subordinated Noteholder waives
and releases all such liability. The waiver and release are part of the
consideration for the issue of the Senior Subordinated Notes.
18. Authentication
This Senior Subordinated Note shall not be valid until an authorized
signatory of the Senior Subordinated Notes Trustee (or an authenticating agent)
manually signs the certificate of authentication on the other side of this
Senior Subordinated Note.
19. Abbreviations
Customary abbreviations may be used in the name of a Senior
Subordinated Noteholder or an assignee, such as TEN COM (=tenants in common),
TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of
survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A
(=Uniform Gift to Minors Act).
20. GOVERNING LAW
THIS SENIOR SUBORDINATED NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
21. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused CUSIP numbers to be
printed on the Senior Subordinated Notes and has directed the Senior
Subordinated Notes Trustee to use CUSIP numbers in notices of redemption as a
convenience to Senior Subordinated Noteholders. No representation is made as to
the accuracy of such numbers either as printed on the Senior Subordinated Notes
or as contained in any notice of redemption and reliance may be placed only on
the other identification numbers placed thereon.
The Company will furnish to any Senior Subordinated Noteholder of
Senior Subordinated Notes upon written request and without charge to the Senior
Subordinated Noteholder a copy of the Indenture which has in it the text of this
Senior Subordinated Note.
ASSIGNMENT FORM
To assign this Senior Subordinated Note, fill in the form below:
I or we assign and transfer this Senior Subordinated Note to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Senior Subordinated Note
on the books of the Company. The agent may substitute another to act for him.
________________________________________________________________________________
Date: ________________ Your Signature: _________________________________________
________________________________________________________________________________
Sign exactly as your name appears on the other side of this Senior Subordinated
Note. Signature must be guaranteed by a participant in a recognized signature
guaranty medallion program or other signature guarantor acceptable to the Senior
Subordinated Notes Trustee.
OPTION OF SENIOR SUBORDINATED NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Subordinated Note purchased
by the Company pursuant to Section 4.06 (Asset Sale) or 4.08 (Change of Control)
of the Indenture, check the box:
Asset Sale |_| Change of Control |_|
If you want to elect to have only part of this Senior Subordinated
Note purchased by the Company pursuant to Section 4.06 or 4.08 of the Indenture,
state the amount:
$
Date: __________________ Your Signature: _______________________________________
(Sign exactly as your name appears on
the other side of the Senior
Subordinated Note)
Signature Guarantee:____________________________________________________________
Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other
signature guarantor acceptable to the Senior Subordinated
Notes Trustee.
EXHIBIT C
Form of
Transferee Letter of Representation
WESCO Distribution, Inc.
In care of
Bank One, N.A.
Bank One Trust Company, N.A.
c/o First Chicago Trust Company
00 Xxxx Xxxxxx
0xx Xxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $
principal amount of the 9 1/8% Senior Subordinated Notes due 2008 (the "Senior
Subordinated Notes") of WESCO Distribution, Inc. (the "Company").
Upon transfer, the Senior Subordinated Notes would be registered in
the name of the new beneficial owner as follows:
Name:________________________
Address:_____________________
Taxpayer ID Number:__________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")) purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount of the
Senior Subordinated Notes, and we are acquiring the Senior Subordinated Notes
not with a view to, or for offer or sale in connection with, any distribution in
violation of the Securities Act. We have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of our investment in the Senior Subordinated Notes, and we invest in or
purchase Senior Subordinated Notes similar to the Senior Subordinated Notes in
the normal course of our business. We, and any accounts for which we are acting,
are each able to bear the economic risk of our or its investment.
2. We understand that the Senior Subordinated Notes have not been
registered under the Securities Act and, unless so registered, may not be sold
except as permitted in the following sentence. We agree on our own behalf and on
behalf of any investor account for which we are purchasing Senior Subordinated
Notes to offer, sell or otherwise transfer such Senior Subordinated Notes prior
to the date that is two years after the
2
later of the date of original issue and the last date on which the Company or
any affiliate of the Company was the owner of such Senior Subordinated Notes (or
any predecessor thereto) (the "Resale Restriction Termination Date") only (a) to
the Company, (b) pursuant to a registration statement that has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act ("Rule 144A"), to a person we
reasonably believe is a qualified institutional investor under Rule 144A (a
"QIB") that purchases for its own account or for the account of a QIB and to
whom notice is given that the transfer is being made in reliance on Rule 144A,
(d) pursuant to offers and sales that occur outside the United States within the
meaning of Regulation S under the Securities Act, (e) to an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act that is purchasing for its own account or for the
account of such an institutional "accredited investor," in each case in a
minimum principal amount of Notes of $250,000, or (f) pursuant to any other
available exemption from the registration requirements of the Securities Act,
subject in each of the foregoing cases to any requirement of law that the
disposition of our property or the property of such investor account or accounts
be at all times within our or their control and in compliance with any
applicable state securities laws. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Notes is proposed to be made pursuant to clause (e) above
prior to the Resale Restriction Termination Date, the transferor shall deliver a
letter from the transferee substantially in the form of this letter to the
Company and the Senior Subordinated Notes Trustee, which shall provide, among
other things, that the transferee is an institutional "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act
and that it is acquiring such Senior Subordinated Notes for investment purposes
and not for distribution in violation of the Securities Act. Each purchaser
acknowledges that the Company and the Senior Subordinated Notes Trustee reserve
the right prior to the offer, sale or other transfer prior to the Resale
Termination Date of the Senior Subordinated Notes pursuant to clause (d), (e) or
(f) above to require the delivery of an opinion of counsel, certifications or
other information satisfactory to the Company and the Senior Subordinated Notes
Trustee.
TRANSFEREE:_________________,
by:_______________________
