----------------------------------------------------------------------------
----------------------------------------------------------------------------
LODESTAR HOLDINGS, INC.,
as Issuer
and
the GUARANTORS named herein,
as Guarantors
STATE STREET BANK AND TRUST COMPANY
as Trustee
---------------------
INDENTURE
Dated as of May 15, 1998
---------------------
up to $235,000,000
11 1/2% Senior Notes due 2005, Series A
and
11 1/2% Senior Notes due 2005, Series B
----------------------------------------------------------------------------
----------------------------------------------------------------------------
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
------- ---------
310 (a)(1).......................................... 7.10
(a)(2).......................................... 7.10
(a)(3).......................................... N.A.
(a)(4).......................................... N.A.
(a)(5).......................................... 7.10
(b)............................................. 7.08; 7.10; 10.02
(c)............................................. N.A.
311 (a)............................................. 7.11
(b)............................................. 7.11
(c)............................................. N.A.
312(a).............................................. 2.05
(b)............................................. 10.03
(c)............................................. 10.03
313 (a)............................................. 7.06
(b)(1).......................................... N.A.
(b)(2).......................................... 7.06
(c)............................................. 7.06; 10.02
(d)............................................. 7.06
314 (a)............................................. 4.07; 4.09; 10.02
(c)(1).......................................... 10.04
(c)(2).......................................... 10.04
(c)(3).......................................... N.A.
(e)............................................. 10.05
(f)............................................. N.A
315 (a)............................................. 7.01(b)
(b)............................................. 7.05; 10.02
(c)............................................. 7.01(a)
(d)............................................. 7.01(c)
(e)............................................. 6.11
316 (a)(last sentence).............................. 2.09
(a)(1)(A)....................................... 6.05
(a)(1)(B)....................................... 6.04
(a)(2).......................................... N.A.
(b)............................................. 6.07; 9.04
(c)............................................. 9.04
317(a)(1)........................................... 6.08
(a)(2).......................................... 6.09
(b)............................................. 2.04
318 (a)............................................. 10.01
------------------
N.A. means Not Applicable
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
Page
----
ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.............................................1
SECTION 1.02. Incorporation by Reference of TIA......................23
SECTION 1.03. Rules of Construction..................................23
ARTICLE TWO THE SECURITIES
SECTION 2.01. Form and Dating........................................24
SECTION 2.02. Execution and Authentication...........................27
SECTION 2.03. Registrar and Paying Agent.............................29
SECTION 2.04. Paying Agent To Hold Assets in Trust...................29
SECTION 2.05. Securityholder Lists...................................30
SECTION 2.06. Transfer and Exchange..................................30
SECTION 2.07. Replacement Securities.................................38
SECTION 2.08. Outstanding Securities.................................39
SECTION 2.09. Treasury Securities....................................39
SECTION 2.10. Temporary Securities...................................40
SECTION 2.11. Cancellation...........................................40
SECTION 2.12. Defaulted Interest.....................................40
SECTION 2.13. CUSIP Number...........................................41
SECTION 2.14. Designation............................................41
ARTICLE THREE REDEMPTION
SECTION 3.01. Optional Redemption....................................41
SECTION 3.02. Notices to Trustee.....................................42
SECTION 3.03. Selection of Securities To Be Redeemed.................42
SECTION 3.04. Notice of Redemption...................................43
SECTION 3.05. Effect of Notice of Redemption.........................44
SECTION 3.06. Deposit of Redemption Price............................44
SECTION 3.07. Securities Redeemed in Part............................45
ARTICLE FOUR COVENANTS
SECTION 4.01. Payment of Securities..................................45
SECTION 4.02. Maintenance of Office or Agency........................45
SECTION 4.03. Limitation on Restricted Payments......................46
SECTION 4.04. Corporate Existence....................................49
SECTION 4.05. Payment of Taxes and Other Claims......................50
SECTION 4.06. Maintenance of Properties and Insurance................50
SECTION 4.07. Compliance Certificate; Notice of Default..............51
SECTION 4.08. Compliance with Laws...................................52
SECTION 4.09. SEC Reports and Other Information......................52
Page
----
SECTION 4.10. Waiver of Stay, Extension or Usury Laws................53
SECTION 4.11. Limitation on Transactions with Affiliates.............54
SECTION 4.12. Limitation on Indebtedness.............................55
SECTION 4.13. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries........55
SECTION 4.14. Limitation on Liens....................................56
SECTION 4.15. Change of Control......................................57
SECTION 4.16. Limitation on Sale of Assets...........................59
SECTION 4.17. Limitation on Preferred Stock of Restricted
Subsidiaries.........................................62
SECTION 4.18. Future Guarantees......................................62
SECTION 4.19. Conduct of Business....................................62
ARTICLE FIVE SUCCESSOR CORPORATION
SECTION 5.01. When Company May Merge, Etc............................63
SECTION 5.02. Successor Corporation Substituted......................65
ARTICLE SIX DEFAULT AND REMEDIES
SECTION 6.01. Events of Default......................................65
SECTION 6.02. Acceleration...........................................68
SECTION 6.03. Other Remedies.........................................69
SECTION 6.04. Waiver of Past Defaults................................69
SECTION 6.05. Control by Majority....................................69
SECTION 6.06. Limitation on Suits....................................70
SECTION 6.07. Rights of Holders To Receive Payment...................70
SECTION 6.08. Collection Suit by Trustee.............................71
SECTION 6.09. Trustee May File Proofs of Claim.......................71
SECTION 6.10. Priorities.............................................71
SECTION 6.11. Undertaking for Costs..................................72
ARTICLE SEVEN TRUSTEE
SECTION 7.01. Duties of Trustee......................................73
SECTION 7.02. Rights of Trustee......................................74
SECTION 7.03. Individual Rights of Trustee...........................75
SECTION 7.04. Trustee's Disclaimer...................................75
SECTION 7.05. Notice of Default......................................75
SECTION 7.06. Reports by Trustee to Holders..........................76
SECTION 7.07. Compensation and Indemnity.............................76
SECTION 7.08. Replacement of Trustee.................................77
SECTION 7.09. Successor Trustee by Merger, Etc.......................78
SECTION 7.10. Eligibility; Disqualification..........................78
SECTION 7.11. Preferential Collection of Claims Against
Company..............................................79
Page
----
ARTICLE EIGHT DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of Company's Obligations...................79
SECTION 8.02. Legal Defeasance and Covenant Defeasance...............80
SECTION 8.03. Application of Trust Money.............................85
SECTION 8.04. Repayment to Company...................................85
SECTION 8.05. Reinstatement..........................................86
ARTICLE NINE AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.............................86
SECTION 9.02. With Consent of Holders................................87
SECTION 9.03. Compliance with TIA....................................88
SECTION 9.04. Revocation and Effect of Consents......................88
SECTION 9.05. Notation on or Exchange of Securities..................89
SECTION 9.06. Trustee To Sign Amendments, Etc........................89
ARTICLE TEN MISCELLANEOUS
SECTION 10.01. TIA Controls...........................................90
SECTION 10.02. Notices................................................90
SECTION 10.03. Communications by Holders with Other Holders...........91
SECTION 10.04. Certificate and Opinion as to Conditions
Precedent............................................92
SECTION 10.05. Statements Required in Certificate or
Opinion..............................................92
SECTION 10.06. Rules by Trustee, Paying Agent, Registrar..............93
SECTION 10.07. Legal Holidays.........................................93
SECTION 10.08. Governing Law..........................................93
SECTION 10.09. No Adverse Interpretation of Other
Agreements...........................................93
SECTION 10.10. No Recourse Against Others.............................93
SECTION 10.11. Successors.............................................94
SECTION 10.12. Duplicate Originals....................................94
SECTION 10.13. Severability...........................................94
ARTICLE ELEVEN GUARANTEE OF SECURITIES
SECTION 11.01. Unconditional Guarantee................................94
SECTION 11.02. Limitations on Guarantees..............................96
SECTION 11.03. Execution and Delivery of Guarantee....................96
SECTION 11.04. Release of a Guarantor.................................97
SECTION 11.05. Waiver of Subrogation..................................98
SECTION 11.06. Immediate Payment......................................99
SECTION 11.07. No Set-Off.............................................99
SECTION 11.08. Obligations Continuing.................................99
SECTION 11.09. Obligations Reinstated.................................99
Page
----
SECTION 11.10. Obligations Not Affected...............................99
SECTION 11.11. Waiver................................................100
SECTION 11.12. No Obligation To Take Action Against the
Company.............................................100
SECTION 11.13. Dealing with the Company and Others...................100
SECTION 11.14. Default and Enforcement...............................101
SECTION 11.15. Amendment, Etc........................................101
SECTION 11.16. Acknowledgment........................................101
SECTION 11.17. Costs and Expenses....................................101
SECTION 11.18. No Waiver; Cumulative Remedies........................102
SECTION 11.19. Survival of Obligations...............................102
SECTION 11.20. Guarantee in Addition to Other Obligations............102
SECTION 11.21. Severability..........................................102
SECTION 11.22. Successors and Assigns................................103
Signatures ......................................................103
Exhibit A - Form of Series A Note
Exhibit B - Form of Series B Note
Exhibit C - Form of Legend for Book-Entry Securities
Exhibit D - Form of Transferee Letter of Representation
Exhibit E - Form of certification to be given by the holders of
beneficial interest in a temporary Regulation S global
security to Euroclear or Cedel
Exhibit F - Form of certification to be given by Euroclear operator
or Cedel Bank, Societe Anonyme
Exhibit G - Form of certification to be given by transferee of
beneficial interest in a temporary Regulation S global
security
Exhibit H - Form of certification for transfer or exchange of
restricted global security to temporary Regulation S global
security
Exhibit I - Form of certification for transfer or exchange of
restricted global security to permanent Regulation S global
security
Exhibit J - Form of certification for transfer or exchange of
temporary Regulation S global security or permanent Regulation
S global security to restricted global security
Exhibit K-1 - Form of certification for transfer or exchange of
non-global restricted security to restricted global security
Exhibit K-2 - Form of certification for transfer or exchange of
non-global restricted security to permanent Regulation S
global security or temporary Regulation S global security
Exhibit L-1 - Form of certification for transfer or exchange of
non-global permanent Regulation S security to restricted
global security
Exhibit L-2 - Form of certification for transfer or exchange of
non-global permanent Regulation S security to permanent
Regulation S global security
Exhibit M - Form of Guarantee
Note: This Table of Contents shall not, for any purpose, be deemed to be part of
this Indenture.
INDENTURE, dated as of May 15, 1998, by and among LODESTAR HOLDINGS,
INC., a Delaware corporation (the "Company"), as issuer, LODESTAR ENERGY, INC.,
a Delaware corporation, as guarantor, EASTERN RESOURCES, INC., a Kentucky
corporation, as guarantor, and INDUSTRIAL FUELS MINERALS COMPANY, a Michigan
corporation, as guarantor, and STATE STREET BANK AND TRUST COMPANY, as Trustee
(the "Trustee").
Each party hereto agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the Holders of the Company's 11
1/2% Senior Notes due 2005, Series A, and 11 1/2% Senior Notes due 2005, Series
B, without distinction as to Series.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness of a person or any of its
Subsidiaries existing at the time such person becomes a Subsidiary (Restricted
Subsidiary, in the case of the Company) or assumed in connection with the
acquisition of assets from such person, including, without limitation,
Indebtedness incurred by such person in connection with, or in anticipation or
contemplation of, such person becoming a Subsidiary (Restricted Subsidiary, in
the case of the Company) or such acquisition.
"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
"affiliated," "controlling" and "controlled" have meanings correlative of the
foregoing. For purposes of Section 4.11, the term "Affiliate" shall include any
person who, as a result of any transaction described therein, would become an
Affiliate.
2
"Affiliate Transaction" has the meaning provided in Section 4.11(a).
"Agent" means any Registrar or Paying Agent.
"Agent Member" means any member of, or participant in, the Depository.
"Applicable Procedures" has the meaning provided in Section 2.06(g).
"Asset Acquisition" means (i) an Investment by the Company or any
Restricted Subsidiary in any other person pursuant to which such person shall
become a Restricted Subsidiary or a Subsidiary of a Restricted Subsidiary or
shall be merged with the Company or any Restricted Subsidiary or (ii) the
acquisition by the Company or any Restricted Subsidiary of the assets of any
person which constitute all or substantially all of the assets of such person or
any division or line of business of such person.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
transfer, lease, assignment or other transfer for value by the Company or any of
the Restricted Subsidiaries (including, without limitation, any Sale/leaseback)
to any person, in one transaction or a series of related transactions, of (i)
any Capital Stock of any Restricted Subsidiary; (ii) all or substantially all of
the properties and assets of any division or line of business of the Company or
any Restricted Subsidiary; or (iii) other than in the ordinary course of
business, any other properties or assets of the Company or any Restricted
Subsidiary in excess of $1.0 million. For the purposes of this definition, the
term "Asset Sale" shall not include (i) any sale, issuance, conveyance,
transfer, lease or other disposition of properties or assets that is consummated
in accordance with the provisions of Article Five and (ii) the sale of inventory
in the ordinary course of business.
"Asset Sale Offer" has the meaning provided in Section 4.16(a)(ii).
"Asset Sale Offer Payment Date" means, with respect to any Available
Amount from an Asset Sale, the earlier of (x) the 180th day following receipt of
such Available Amount or (y) such earlier date on which an Asset Sale Offer
shall expire.
"Available Amount" has the meaning provided in Section 4.16(a)(ii).
3
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
Federal, state or foreign law for the relief of debtors.
"Board of Directors" means, with respect to any person, the Board of
Directors of such person or any committee of the Board of Directors of such
person duly authorized, with respect to any particular matter, to exercise the
power of the Board of Directors of such person.
"Board Resolution" means with respect to any person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such person
to have been duly adopted by the Board of Directors of such person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Book-Entry Security" means a Security represented by a Global Security
and registered in the name of the nominee of the Depository.
"Business Day" means any day that is not a Legal Holiday.
"Capital Expenditures" shall mean payments for any assets, or
improvements, replacements, substitutions or additions thereto, that have a
useful life of more than one year and which, in accordance with GAAP
consistently applied, are required to be capitalized (as opposed to expensed in
the period in which the payment occurred).
"Capital Lease," as applied to any person, means any lease of (or any
agreement conveying the right to use) any property (whether real, personal or
mixed) by such person as lessee which, in conformity with GAAP, is required to
be accounted for as a capital lease on the balance sheet of such person.
"Capital Stock" means, with respect to any person, any and all shares,
interests, participation or other equivalents (however designated) of such
person's capital stock, whether outstanding at the Issue Date or issued after
the Issue Date, and any and all rights, warrants or options exchangeable for or
convertible into such capital stock (but excluding any debt security that is
exchangeable for or convertible into such capital stock).
4
"Capitalized Lease Obligation" means, as to any person, the obligations
of such person under a Capital Lease and, for purposes of this Indenture, the
amount of such obligations at any date shall be the capitalized amount of such
obligations at such date, determined in accordance with GAAP.
"Cash Equivalents" means (i) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within two years from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof maturing within two years from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either Standard & Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc. ("S&P") or Xxxxx'x Investors Service, Inc.
("Moody's"); (iii) commercial paper maturing no more than two years from the
date of creation thereof and, at the time of acquisition, having a rating of at
least A-1 from S&P or at least P-1 from Moody's; (iv) certificates of deposit or
bankers' acceptances maturing within two years from the date of acquisition
thereof issued by any commercial bank organized under the laws of the United
States of America or any state thereof or the District of Columbia or any U.S.
branch of a foreign bank having at the date of acquisition thereof combined
capital and surplus of not less than $500,000,000; (v) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clause (i) above entered into with any bank meeting the
qualifications specified in clause (iv) above; and (vi) investments in money
market funds which invest substantially all their assets in securities of the
types described in clauses (i) through (v) above. Notwithstanding the foregoing,
for purposes of clause (i) of the definition of "Permitted Investment," 20% of
the Cash Equivalents may include securities having a rating of at least BBB by
S&P and Baa by Moody's.
"CEDEL" means Cedel Bank, Societe Anonyme (or any successor securities
clearing agency).
"Change of Control" means the occurrence of one or more of the
following events: (i) any direct or indirect sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the assets of the Company or Renco to any person or group
of related persons for purposes of Section 13(d) of the Exchange
5
Act (a "Group") (other than a Permitted Holder or a Group controlled by a
Permitted Holder), together with any Affiliates thereof (whether or not
otherwise in compliance with the provisions of this Indenture); (ii) the
approval by the holders of Capital Stock of the Company or Renco, as the case
may be, of any plan or proposal for the liquidation or dissolution of the
Company, or Renco, as the case may be (whether or not otherwise in compliance
with the provisions of this Indenture); (iii) the acquisition in one or more
transactions of "beneficial ownership" (within the meaning of Rules 13d-3 and
13d-5 under the Exchange Act, except that a person shall be deemed to have
"beneficial ownership" of all securities that such person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time) by any person, entity or Group (other than a Permitted Holder or a
Group controlled by any Permitted Holder) of any Capital Stock of the Company or
Renco such that, as a result of such acquisition, such person, entity or Group
either (A) beneficially owns (within the meaning of Rules 13d-3 and 13d-5 under
the Exchange Act), directly or indirectly, more than 50% of the Company's or
Renco's then outstanding voting securities entitled to vote on a regular basis
in an election for a majority of the Board of Directors of the Company or Renco
or (B) otherwise has the ability to elect, directly or indirectly, a majority of
the members of the Company's or Renco's Board of Directors; or (iv) the
shareholders of Renco as of the Issue Date and the Permitted Holders shall cease
to own at least 50% of the equity of Renco owned by such shareholders on the
Issue Date.
"Change of Control Date" has the meaning provided in Section 4.15(a).
"Change of Control Offer" has the meaning provided in Section 4.15(a).
"Change of Control Payment Date" has the meaning provided in Section
4.15(b)(2).
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means such
successor.
"Company Order" means a written order or request signed in the name of
the Company by its President or a Vice President, and by its Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
6
"Consolidated EBITDA" means, with respect to any person, for any
period, the sum (without duplication) of (i) Consolidated Net Income, (ii) to
the extent Consolidated Net Income has been reduced thereby, all income taxes of
such person and its Subsidiaries (Restricted Subsidiaries, in the case of the
Company) paid or accrued in accordance with GAAP for such period (other than
income taxes attributable to extraordinary, unusual or non-recurring gains or
losses), Consolidated Interest Expense, amortization expense (including
amortization of deferred financing costs) and depletion and depreciation expense
and (iii) other non-cash items (other than non-cash interest) reducing
Consolidated Net Income (including, without limitation, any non-cash charges in
respect of post-employment benefits for health care, life insurance and long-
term disability benefits required in accordance with GAAP) less other non-cash
items increasing Consolidated Net Income, all as determined on a consolidated
basis for such person and its Subsidiaries (Restricted Subsidiaries, in the case
of the Company) in accordance with GAAP.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to any
person, the ratio of Consolidated EBITDA of such person during the four full
fiscal quarters (the "Four Quarter Period") ending on or prior to the date of
the transaction giving rise to the need to calculate the Consolidated Fixed
Charge Coverage Ratio (the "Transaction Date") to Consolidated Fixed Charges of
such person for the Four Quarter Period. For purposes of this definition, if the
Transaction Date occurs prior to the date on which four full fiscal quarters
have elapsed subsequent to the Issue Date and financial statements with respect
thereto are available, "Consolidated EBITDA" and "Consolidated Fixed Charges"
shall be calculated, in the case of the Company, after giving effect on a pro
forma basis to the issuance of the Securities and the application of the net
proceeds therefrom as if the Securities were issued on the first day of the Four
Quarter Period. In addition to and without limitation of the foregoing, for
purposes of this definition, "Consolidated EBITDA" and "Consolidated Fixed
Charges" shall be calculated after giving effect on a pro forma basis for the
period of such calculation to (i) the incurrence of any Indebtedness (and the
application of the net proceeds therefrom) of such person or any of its
Subsidiaries (Restricted Subsidiaries, in the case of the Company) giving rise
to the need to make such calculation and any incurrence of other Indebtedness at
any time on or after the first day of the Four Quarter Period and on or prior to
the Transaction Date (the "Reference Period"), as if such incurrence occurred on
the first day of the Reference Period and (ii) any Asset Sales or
7
Asset Acquisitions (including, without limitation, any Asset Acquisition giving
rise to the need to make such calculation as a result of such person or one of
its Subsidiaries (Restricted Subsidiaries, in the case of the Company)
(including any person who becomes a Subsidiary (Restricted Subsidiary, in the
case of the Company) as a result of the Asset Acquisition) incurring, assuming
or otherwise being liable for Acquired Indebtedness) occurring during the
Reference Period, as if such Asset Sale or Asset Acquisition (including the
incurrence, assumption or liability for any such Indebtedness or Acquired
Indebtedness) occurred on the first day of the Reference Period. If such person
or any of its Subsidiaries (Restricted Subsidiaries, in the case of the Company)
directly or indirectly guarantees Indebtedness of a third person, the preceding
sentence shall give effect to the incurrence of such guaranteed Indebtedness as
if such person or any Subsidiary (Restricted Subsidiary, in the case of the
Company) of such person had directly incurred or otherwise assumed such
guaranteed Indebtedness. Furthermore, in calculating "Consolidated Fixed
Charges" for purposes of this "Consolidated Fixed Charge Coverage Ratio," (1)
interest on Indebtedness determined on a fluctuating basis as of the Transaction
Date and which will continue to be so determined thereafter shall be deemed to
have accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date, and (2) notwithstanding clause
(1) above, interest on Indebtedness determined on a fluctuating basis, to the
extent such interest is covered by agreements relating to Interest Rate
Protection Obligations, shall be deemed to accrue at the rate per annum
resulting after giving effect to the operation of such agreements.
"Consolidated Fixed Charges" means, with respect to any person for any
period, the sum of, without duplication, the amounts for such period, taken as a
single accounting period, of (i) Consolidated Interest Expense of such person
(net of any interest income) less non-cash amortization of deferred financing
costs and (ii) the product of (x) the amount of all dividends declared and paid
on Preferred Stock of such person during such period times (y) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current effective consolidated Federal, state, local and foreign tax rate
(expressed as a decimal number between 1 and 0) of such person during such
period (as reflected in the audited consolidated financial statements of such
person for the most recently completed fiscal year).
"Consolidated Interest Expense" means, with respect to any person for
any period, without duplication, the sum of
8
(i) the interest expense of such person and its Subsidiaries (Restricted
Subsidiaries, in the case of the Company) for such period as determined on a
consolidated basis in accordance with GAAP consistently applied, including,
without limitation, (a) any amortization of debt discount, (b) the net cost
under Interest Rate Protection Obligations (including any amortization of
discounts), (c) the interest portion of any deferred payment obligation and (d)
all accrued interest, and (ii) the interest component of Capitalized Lease
Obligations paid, accrued and/or scheduled to be paid or accrued by such person
and its Subsidiaries (Restricted Subsidiaries, in the case of the Company)
during such period as determined on a consolidated basis in accordance with GAAP
consistently applied.
"Consolidated Net Income" means, with respect to any person for any
period, the net income (or loss) of such person and its Subsidiaries (Restricted
Subsidiaries, in the case of the Company), on a consolidated basis for such
period determined in accordance with GAAP; provided that (i) the net income of
any person in which such person or any Subsidiary (Restricted Subsidiary, in the
case of the Company) of such person has an ownership interest with a third party
(other than a person that meets the definition of a Wholly-Owned Subsidiary
(Wholly-Owned Restricted Subsidiary, in the case of the Company)) shall be
included only to the extent of the amount that has actually been received by
such person or its Wholly-Owned Subsidiaries (Wholly-Owned Restricted
Subsidiaries, in the case of the Company) in the form of dividends or other
distributions during such period (subject to, in the case of any dividend or
distribution received by a Wholly-Owned Subsidiary) (Wholly-Owned Restricted
Subsidiary, in the case of the Company) of such person, the restrictions set
forth in clause (ii) below) and (ii) the net income of any Subsidiary
(Restricted Subsidiary, in the case of the Company) of such person that is
subject to any restriction or limitation on the payment of dividends or the
making of other distributions shall be excluded to the extent of such
restriction or limitation; provided, further that there shall be excluded (a)
the net income (or loss) of any person (acquired in a pooling of interests
transaction) accrued prior to the date it becomes a Subsidiary (Restricted
Subsidiary, in the case of the Company) of such person or is merged into or
consolidated with such person or any Subsidiary (Restricted Subsidiary, in the
case of the Company) of such person, (b) any gain (or loss) (and related tax
effects) resulting from an Asset Sale by such person or any of its Subsidiaries
(Restricted Subsidiaries, in the case of the Company), (c) any extraordinary,
unusual or nonrecurring gains or losses (and related tax effects) in accordance
with GAAP and
9
(d) any compensation-related expenses arising as a result of the application of
the net proceeds from the issuance of the Securities. For purposes of Section
4.03, the amortization of deferred financing costs relating to the issuance of
the Securities shall be excluded from this definition of "Consolidated Net
Income."
"Covenant Defeasance" has the meaning provided in Section 8.02(c).
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage of time
or both would be, an Event of Default.
"Depository" means, with respect to the Securities issued in the form
of one or more Book-Entry Securities, The Depository Trust Company or another
person designated as Depository by the Company, which must be a clearing agency
registered under the Exchange Act.
"Depository Securities Certification" has the meaning provided in
Section 2.01.
"Disqualified Capital Stock" means any class of Capital Stock which, by
its terms (or by the terms of any security into which it is convertible or for
which it is exchangeable), or upon the happening of any event (other than a
Change of Control), matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise, or is redeemable at the option of the holder
thereof, in whole or in part, on or prior to the Maturity Date.
"Eastern Resources" means Eastern Resources, Inc., a Kentucky
corporation.
"Equity Offering" means an offering of Qualified Capital Stock of the
Company (other than to any Subsidiary of the Company).
"Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency).
"Event of Default" has the meaning provided in Section 6.01.
10
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer" means the registration by the Company under the
Securities Act of all the Series B Notes pursuant to a registration statement
under which the Company offers each Holder of Series A Notes the opportunity to
exchange all Series A Notes held by such Holder for Series B Notes in an
aggregate principal amount equal to the aggregate principal amount of Series A
Notes held by such Holder, all in accordance with the terms and conditions of
the Registration Rights Agreement.
"Fair Market Value" means, with respect to any asset, the price which
could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of whom is under undue
pressure or compulsion to complete the transaction. Fair Market Value of any
asset of the Company or the Restricted Subsidiaries shall be determined by the
Board of Directors of the Company acting in good faith and shall be evidenced by
a Board Resolution thereof delivered to the Trustee; provided that with respect
to any Asset Sale which involves in excess of $5.0 million, the Fair Market
Value of any such asset or assets shall be determined by an Independent
Financial Advisor.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are in effect as of the Issue Date.
"Global Security" means a Security evidencing all or a part of the
Securities to be issued as Book-Entry Securities, issued to the Depository in
accordance with Section 2.02 and bearing the legend or legends prescribed in
Exhibit C to this Indenture.
"guarantee" means, as applied to any obligation, (a) a guarantee (other
than by endorsement of negotiable instruments for collection in the ordinary
course of business), direct or indirect, in any manner, of any part or all of
such obligation and (b) an agreement, direct or indirect, contingent or
otherwise, the practical effect of which is to assure in any way the payment or
performance (or payment of damages in the
11
event of non-performance) of all or any part of such obligation, including,
without limiting the foregoing, the payment of amounts drawn down by letters of
credit.
"Guarantees" means the guarantee of the Securities by the Guarantors.
"Guarantors" means collectively each of Lodestar, Eastern Resources,
Industrial Fuels and any Restricted Subsidiary that in the future executes a
supplemental indenture pursuant to Section 4.18 of this Indenture or otherwise
in which any such Restricted Subsidiary agrees to be bound by the terms of this
Indenture; provided that any person constituting a Guarantor as described above
shall cease to constitute a Guarantor when its respective Guarantee is released
in accordance with the terms of this Indenture.
"Holder" or "Securityholder" means the person in whose name a Security
is registered on the Registrar's books.
"Indebtedness" means with respect to any person, without duplication,
(i) all obligations of such person for borrowed money, (ii) all obligations of
such person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all Capitalized Lease Obligations (but not obligations under Operating
Leases) of such person, (iv) all obligations of such person issued or assumed as
the deferred purchase price of property or services, all conditional sale
obligations and all obligations under any title retention agreement (but
excluding trade accounts payable, accrued expenses and deferred taxes arising in
the ordinary course of business), (v) all obligations of such person for the
reimbursement of any obligor on any letter of credit, banker's acceptance or
similar credit transaction entered into in the ordinary course of business, (vi)
all obligations of any other person of the type referred to in clauses (i)
through (v) which are secured by any Lien on any property or asset of such first
person and the amount of such obligation shall be the lesser of the value of
such property or asset or the amount of the obligation so secured, (vii) all
guarantees of Indebtedness by such person, (viii) Disqualified Capital Stock
valued at the greater of its voluntary or involuntary maximum fixed repurchase
price plus accrued and unpaid dividends, (ix) all obligations under interest
rate agreements or hedging agreements of such person and (x) any amendment,
supplement, modification, deferral, renewal, extension or refunding of any
liability of the types referred to in clauses (i) through (ix) above. For
purposes hereof, the "maximum fixed repurchase price" of any Disqualified
Capital
12
Stock which does not have a fixed repurchase price shall be calculated in
accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the Fair Market Value of such Disqualified
Capital Stock, such Fair Market Value to be determined in good faith by the
Board of Directors of the person issuing such Disqualified Capital Stock.
Notwithstanding anything to the contrary contained herein or in this Indenture,
Indebtedness shall not include (i) the purchase of coal reserves requiring the
payment of royalty fees on an installment basis in the ordinary course of
business consistent with past practice, (ii) obligations under performance
bonds, surety bonds or appeal bonds, letters of credit (other than reimbursement
obligations) or similar obligations, in each case incurred in the ordinary
course of business and (iii) any obligation of the Company or any Restricted
Subsidiary in the form of an earn-out arrangement undertaken in connection with
any acquisition of property or assets by the Company or such Restricted
Subsidiary, which obligation shall be based upon increases in coal prices above
price levels existing on the date of such acquisition, shall not constitute
Indebtedness under this Indenture.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Independent Financial Advisor" means an accounting, appraisal or
investment banking firm of nationally recognized standing that is, in the
reasonable and good faith judgment of the Board of Directors of the Company,
qualified to perform the task for which such firm has been engaged and
disinterested and independent with respect to the Company and its Affiliates.
"Industrial Fuels" means Industrial Fuels Minerals Company, a Michigan
corporation.
"Initial Purchasers" means Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation and BT Alex. Xxxxx Incorporated.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Securities.
"Interest Rate Protection Obligations" means the obligations of any
person pursuant to any arrangement with any other person, whereby, directly or
indirectly, such person is entitled to receive from time to time periodic
payments calculated
13
by applying either a floating or a fixed rate of interest on a stated notional
amount in exchange for periodic payments made by such other person calculated by
applying a fixed or a floating rate of interest on the same notional amount and
shall include, without limitation, interest rate swaps, caps, floors, collars
and similar agreements.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter.
"Investment" means, with respect to any person, any direct or indirect
advance, loan, guarantee or other extension of credit 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 otherwise), or any
purchase or acquisition by such person of any Capital Stock, bonds, notes,
debentures or other securities or evidences of Indebtedness issued by, any other
person. Investments shall exclude extensions of trade credit on commercially
reasonable terms in accordance with normal trade practices. For the purposes of
Section 4.03, the amount of any Investment (other than an Investment covered by
clause (z) of Section 4.03) shall be the original cost of such Investment plus
the cost of all additional Investments by the Company or any of the Restricted
Subsidiaries, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment, reduced by
the payment of dividends or distributions in connection with such Investment or
any other amounts received in respect of such Investment.
"Issue Date" means May 15, 1998.
"legal defeasance" has the meaning provided in Section 8.02(b).
"Legal Holiday" has the meaning provided in Section 10.07.
"Lien" means (x) any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind including, without limitation, any
conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell and any filing of or agreement to
file a financing statement as debtor under the Uniform Commercial Code or any
similar statute and (y) any agreement to enter into any of the foregoing.
14
"Lodestar" means Lodestar Energy, Inc., a Delaware corporation.
"Maturity Date" means May 15, 2005.
"Net Cash Proceeds" means, with respect to any Asset Sale, the proceeds
thereof in the form of cash or Cash Equivalents including payments in respect of
deferred payment obligations when received in the form of cash or Cash
Equivalents (except to the extent that such obligations are financed or sold
with recourse to the Company or any Restricted Subsidiary) net of (i) brokerage
commissions and other fees and expenses (including fees and expenses of legal
counsel and investment bankers) related to such Asset Sale, (ii) provisions for
all taxes payable as a direct result of such Asset Sale and (iii) appropriate
amounts to be provided by the Company or any Restricted Subsidiary, as the case
may be, as a reserve required in accordance with GAAP consistently applied
against any liabilities associated with such Asset Sale and retained by the
Company or any Restricted Subsidiary, as the case may be, after such Asset Sale,
including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Asset Sale, all as
reflected in an Officers' Certificate delivered to the Trustee.
"New Senior Credit Facility" means the Amended and Restated Loan and
Security Agreement dated as of the Issue Date among the Company, Lodestar, the
financial institutions named therein, Congress Financial Corporation and The CIT
Group/Business Credit, Inc., as the same may be amended, restated, supplemented
or otherwise modified from time to time, and includes any agreement renewing,
refinancing or replacing all or any portion of the Indebtedness under such
agreement.
"Obligations" means any principal, interest, penalties, fees and other
liabilities payable under the documentation governing any Indebtedness.
"Officer" means, with respect to any person, the Chairman of the Board,
the Chief Executive Officer, the President, any Vice President, the Chief
Financial Officer, the Controller, the Treasurer, the Secretary or Assistant
Secretary of such person.
"Officers' Certificate" means, with respect to any person, a
certificate signed by two Officers or by an Officer and either an Assistant
Treasurer or an Assistant Secretary of
15
such person and otherwise complying with the requirements of Sections 10.04 and
10.05.
"Operating Lease" means, as applied to any person, any lease
(including, without limitation, leases that may be terminated by the lessee at
any time) of any property (whether real, personal or mixed) that is not a
Capital Lease other than any such lease under which that person is the lessor.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee complying with the requirements of Sections 10.04 and
10.05. Unless otherwise required by the TIA, the legal counsel may be an
employee of or counsel to the Company.
"Owner Securities Certification" has the meaning provided in Section
2.01.
"Paying Agent" has the meaning provided in Section 2.03.
"Permanent Regulation S Global Security" has the meaning provided in
Section 2.01.
"Permitted Holders" means Xxx Xxxx Xxxxxxx and his Affiliates, estate,
heirs and legatees, and the legal representatives of any of the foregoing,
including, without limitation, the trustee of any trust of which one or more of
the foregoing are the sole beneficiaries.
"Permitted Indebtedness" means (i) any Indebtedness of the Company and
the Restricted Subsidiaries under the New Senior Credit Facility consisting of
(A) a borrowing facility in an aggregate amount not to exceed $90.0 million in
aggregate principal amount at any time outstanding plus (B) a $30.0 million
letter of credit facility, in each case plus any interest, fees and expenses
from time to time owed thereunder, (ii) the Series A Notes issued on the Issue
Date and the Senior B Notes issued in exchange therefor after the Issue Date in
an aggregate principal amount not to exceed $150.0 million, and the related
Guarantees, (iii) any other Indebtedness of the Company and the Restricted
Subsidiaries outstanding on the Issue Date, (iv) purchase money Indebtedness and
any Indebtedness incurred for Capitalized Lease Obligations of the Company and
the Restricted Subsidiaries not to exceed $20.0 million in the aggregate at any
time outstanding, (v) Interest Rate Protection Obligations to the extent the
notional principal amount of such Interest Rate Protection Obligations does not
exceed the principal
16
amount of the Indebtedness to which such Interest Rate Protection Obligations
relate entered into in the ordinary course of business, (vi) additional
Indebtedness of the Company and the Restricted Subsidiaries not to exceed $30.0
million in the aggregate at any time outstanding, (vii) Indebtedness owed by the
Company or any of the Restricted Subsidiaries to the Company or any Restricted
Subsidiary; provided that in the case of Indebtedness owed by the Company to any
Restricted Subsidiary, such Indebtedness is contractually subordinated in right
of payment to the Securities, (viii) any renewals, extensions, substitutions,
refundings, refinancings or replacements of any Indebtedness described in the
preceding clauses (i), (ii) and (iii) above and this clause (viii), so long as
such renewal, extension, substitution, refunding, refinancing or replacement
does not result in an increase in the aggregate principal amount of the
outstanding Indebtedness represented thereby (except if such Indebtedness
refinances Indebtedness under the New Senior Credit Facility or any other
agreement providing for subsequent borrowings, does not result in an increase in
the commitment available under the New Senior Credit Facility or such other
agreement), (ix) any indebtedness of the Company or the Guarantors to Renco in
an aggregate principal amount not to exceed $15.0 million at any time
outstanding; provided that any such Indebtedness is contractually subordinated
in right of payment to the Company's obligations under the Securities or such
Guarantor's obligations under its Guarantee, as the case may be; provided,
further, that if as of any date any person other than Renco or one of its
Wholly-Owned Subsidiaries owns or holds any such Indebtedness or holds a Lien on
the instrument held by Renco or one of its Wholly-Owned Subsidiaries governing
such Indebtedness, such date shall be deemed the incurrence of Indebtedness not
constituting Permitted Indebtedness pursuant to this clause (ix) and (x) any
guarantees of the foregoing.
"Permitted Investment" means (i) cash and Cash Equivalents, (ii) any
Investment by the Company or any of the Restricted Subsidiaries in the Company
or any Restricted Subsidiary, (iii) Related Business Investments by the Company
or any of the Restricted Subsidiaries in joint ventures, partnerships or persons
(including Unrestricted Subsidiaries) that are not Restricted Subsidiaries in an
amount not to exceed $25.0 million in the aggregate at any one time outstanding,
(iv) Investments by the Company or any Restricted Subsidiary in another person,
if as a result of such Investment (a) such other person becomes a Restricted
Subsidiary or (b) such other person is merged or consolidated with or into, or
transfers or conveys all or substantially all of its assets to, the Company
17
or a Restricted Subsidiary, (v) Investments received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers, in
each case arising in the ordinary course of business, (vi) the non-cash proceeds
of any Asset Sale, (vii) Investments under or pursuant to Interest Rate
Protection Obligations in the ordinary course of business and (viii) loans and
advances to employees of the Company and the Restricted Subsidiaries made in the
ordinary course of business.
"Permitted Liens" means (i) pledges or deposits by such person under
worker's compensation laws, unemployment insurance laws or similar legislation,
or good faith deposits in connection with bids, tenders, contracts (other than
for the payment of Indebtedness) or leases to which such person is a party, or
deposits to secure public statutory obligations of such person or deposits to
secure surety or appeal bonds to which such person is a party, or deposits as
security for contested taxes or import duties or for the payment of rent, (ii)
Liens imposed by law, such as landlords', carriers', warehousemen's and
mechanics' Liens or bankers' Liens incurred in the ordinary course of business
for sums which are not yet due or are being contested in good faith and for
which adequate provision has been made, (iii) Liens for taxes not yet subject to
penalties for non-payment or which are being contested in good faith and by
appropriate proceedings, if adequate reserve, as may be required by GAAP, shall
have been made therefor, (iv) Liens in favor of issuers of performance bonds,
surety bonds or appeal bonds issued pursuant to the request of and for the
account of such person in the ordinary course of its business, (v) Liens to
support trade letters of credit issued in the ordinary course of business, (vi)
survey exceptions, encumbrances, easements or reservations of, or rights of
others for, rights of way, sewers, electric lines, telegraph and telephone lines
and other similar purposes, or zoning or other restrictions on the use of real
property, (vii) Liens securing Indebtedness permitted under clause (iv) of the
definition of Permitted Indebtedness; provided that the Fair Market Value of the
asset at the time of the incurrence of the Indebtedness subject to the Lien
shall not exceed the principal amount of the Indebtedness secured, (viii) Liens
with respect to Acquired Indebtedness permitted to be incurred in accordance
with Section 4.12; provided that such Liens secured such Acquired Indebtedness
at the time of the incurrence of such Acquired Indebtedness by the Company or
any of the Restricted Subsidiaries and were not incurred in connection with, or
in anticipation of, the incurrence of such Acquired Indebtedness by the Company
18
or any of the Restricted Subsidiaries; provided, further, that such Liens do not
extend to or cover any property or assets of the Company or any of the
Restricted Subsidiaries other than the property or assets that secured the
Acquired Indebtedness prior to the time such Indebtedness became Acquired
Indebtedness of the Company or any of the Restricted Subsidiaries and are no
more favorable to the lienholders than those securing the Acquired Indebtedness
prior to the incurrence of such Acquired Indebtedness by the Company or any of
the Restricted Subsidiaries, (ix) Liens arising from judgments, decrees or
attachments in circumstances not constituting an Event of Default, (x) Liens on
assets or property (including any real property upon which such assets or
property are or will be located) securing Indebtedness incurred to purchase or
construct such assets or property, which Indebtedness is permitted to be
incurred under this Indenture, (xi) Liens securing Indebtedness which is
incurred to refinance or replace Indebtedness which has been secured by a Lien
permitted under this Indenture and is permitted to be refinanced or replaced
under this Indenture, provided that such Liens do not extend to or cover any
property or assets of the Company or any of the Restricted Subsidiaries not
securing the Indebtedness so refinanced or replaced, and (xii) Liens securing
reimbursement obligations under letters of credit but only in or upon the goods
the purchase of which was financed by such letters of credit.
"person" means any individual, corporation, partnership, joint venture,
trust, estate, unincorporated organization or government or any agency or
political subdivision thereof or any similar entities.
"Plan of Liquidation" means, with respect to any person, a plan that
provides for, contemplates or the effectuation of which is preceded or
accompanied by (whether or not substantially contemporaneously, in phases or
otherwise) (i) the sale, lease, conveyance or other disposition of all or
substantially all of the assets of such person otherwise than as an entirety or
substantially as an entirety and (ii) the distribution of all or substantially
all of the proceeds of such sale, lease, conveyance or other disposition and all
or substantially all of the remaining assets of such person to holders of
Capital Stock of such person.
"Preferred Stock" means, with respect to any person, any and all
shares, interests, participation or other equivalents (however designated) of
such person's preferred or preference stock, whether outstanding on the Issue
Date or issued
19
thereafter, and including, without limitation, all classes and series of
preferred or preference stock of such person.
"principal" of any Indebtedness (including the Securities) means the
principal of such Indebtedness plus the premium, if any, on such Indebtedness.
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Exchange Act.
"Qualified Capital Stock" means, with respect to any person, any
Capital Stock of such person that is not Disqualified Capital Stock or
convertible into or exchangeable or exercisable for Disqualified Capital Stock.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Record Date" means the Record Dates specified in the Securities;
provided that if any such date is a Legal Holiday, the Record Date shall be the
first day immediately preceding such specified day that is not a Legal Holiday.
"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture
and the Securities.
"Redemption Price," when used with respect to any Security to be
redeemed, means the price fixed for such redemption pursuant to this Indenture
and the Securities.
"Registrar" has the meaning provided in Section 2.03.
"Registration Rights Agreement" means the Registration Rights Agreement
by and among the Company, the Guarantors and the Initial Purchasers, dated as of
May 15, 1998, as the same may be amended, supplemented or otherwise modified
from time to time in accordance with the terms thereof.
"Regulation S" means Regulation S under the Securities Act (or any
successor provision), as it may be amended from time to time.
"Related Business Investment" means any Investment, Capital Expenditure
or other expenditure by the Company or any Restricted Subsidiary which is
related to the business of the
20
Company and the Restricted Subsidiaries as it is conducted on the Issue Date or
any business which is the same, similar or reasonably related to such business.
"Renco" means The Renco Group, Inc., a New York corporation, which is
the parent of the Company, or any successor thereto.
"Restricted Global Security" has the meaning provided in Section 2.01.
"Restricted Payment" has the meaning provided in Section 4.03.
"Restricted Period" has the meaning provided in Section 2.01.
"Restricted Security" has the meaning provided in Rule 144(a)(3) under
the Securities Act.
"Restricted Subsidiary" means any Subsidiary of the Company which at
the time of determination is not an Unrestricted Subsidiary. The Board of
Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary only if, immediately after giving effect to such
designation, the Company and the Guarantors could incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to Section
4.12, on a pro forma basis taking into account such designation.
"Sale/leaseback" means any lease whereby the Company or any of the
Restricted Subsidiaries, directly or indirectly, becomes or remains liable as
lessee or as guarantor or other surety, of any property (whether real or
personal or mixed) whether now owned or hereafter acquired, (i) that the Company
or the Restricted Subsidiaries, as the case may be, has sold or transferred or
is to sell or transfer to any other person (other than the Company or any
Restricted Subsidiary), or (ii) that the Company or any of the Restricted
Subsidiaries, as the case may be, intends to use for substantially the same
purpose as any other property that has been or is to be sold or transferred by
the Company or any such Restricted Subsidiary to any person (other than the
Company or any Restricted Subsidiary) in connection with such lease.
"SEC" means the Securities and Exchange Commission.
21
"Securities" means the Series A Notes, and the Series B Notes and any
other notes issued after the Issue Date in accordance with clause (ii) of the
fourth paragraph of Section 2.02.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Series A Notes" means the Company's 11 1/2% Senior Notes due 2005,
Series A, as amended or supplemented from time to time in accordance with the
terms hereof, that are issued pursuant to this Indenture.
"Series B Notes" means the Company's 11 1/2% Senior Notes due 2005,
Series B, as amended or supplemented from time to time in accordance with the
terms hereof, that are issued pursuant to this Indenture.
"Significant Subsidiary" means any Restricted Subsidiary that satisfies
the criteria for a "significant subsidiary" set forth in Rule 1-02(w) of
Regulation S-X under the Exchange Act.
"Subsidiary" of any person means (i) any corporation of which the
outstanding capital stock having at least a majority of the votes entitled to be
cast in the election of directors under ordinary circumstances shall at the time
be owned, directly or indirectly, by such person or (ii) any other person of
which at least a majority of the voting interest under ordinary circumstances is
at the time owned, directly or indirectly, by such person. For purposes of this
definition, any directors' qualifying shares or investments by foreign nationals
mandated by applicable law shall be disregarded in determining the ownership of
a Subsidiary.
"Temporary Regulation S Global Security" has the meaning provided in
Section 2.01.
"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 the execution of this
Indenture until such time as this Indenture is qualified under the TIA, and
thereafter as in effect on the date on which this Indenture is qualified under
the TIA.
"Transferee Certificate" means the Transferee Letter of Representation
attached as Exhibit D to this Indenture.
22
"Transferee Securities Certification" has the meaning provided in
Section 2.06(g).
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Trust Officer" means any officer of the Trustee assigned by the
Trustee to administer its corporate trust matters.
"U.S. Government Obligations" has the meaning provided in Section
8.01(b).
"U.S. Legal Tender" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company which
at the time of determination is an Unrestricted Subsidiary (as designated by the
Board of Directors of the Company, as provided below) and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors of the Company may designate
any Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary) to be an Unrestricted Subsidiary, unless such Subsidiary owns any
Capital Stock of, or owns or holds any Lien on, any property of, any Restricted
Subsidiary of the Company which is not a Subsidiary of the Subsidiary to be so
designated; provided that (a) the Company certifies that such designation
complies with Section 4.03 and (b) each Subsidiary to be so designated and each
of its Subsidiaries has not at the time of designation, and does not thereafter,
create, incur, issue, assume, guarantee or otherwise become directly or
indirectly liable with respect to any Indebtedness pursuant to which the lender
has recourse to any of the assets of the Company or any of the Restricted
Subsidiaries. The Board of Directors of the Company may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary only if, immediately after
giving effect to such designation, the Company and the Guarantors could incur at
least $1.00 of additional Indebtedness (other than Permitted Indebtedness)
pursuant to Section 4.12, on a pro forma basis taking into account such
designation.
"Wholly-Owned Restricted Subsidiary" means any Restricted Subsidiary
which is a Wholly-Owned Subsidiary of the Company.
23
"Wholly-Owned Subsidiary" means any Subsidiary of such person to the
extent all of the Capital Stock or other ownership interests in such Subsidiary
(other than (x) directors' qualifying shares and (y) an immaterial interest
owned by other persons solely to comply with applicable law) is owned directly
or indirectly by such person or a Wholly-Owned Subsidiary of such person.
SECTION 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder or a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on this Indenture securities means the Company or any other
obligor on the 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 and not
otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular;
24
(5) provisions apply to successive events and transactions; and
(6) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Trustee's certificate of authentication with
respect thereto shall be substantially in the form of Exhibit A or Exhibit B
hereto, as the case may be. The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage. The Company and the
Trustee shall approve the form of the Securities and any notation, legend or
endorsement on them. Each Security shall be dated the date of its
authentication, shall bear interest from the applicable date and shall be
payable on the Interest Payment Dates and the Maturity Date. Each Security shall
have an executed Guarantee from each of the Guarantors endorsed thereon
substantially in the form of Exhibit M hereto.
The terms and provisions contained in the Securities shall constitute,
and are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company, the Guarantors and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.
Securities offered and sold in their initial distribution in reliance
on Regulation S may be initially issued in the form of temporary Global
Securities in fully registered form without interest coupons, substantially in
the form of Exhibit A, with such applicable legends as are provided for in
Exhibit A or Exhibit C. Such temporary Global Securities may be registered in
the name of the Depository or its nominee and deposited with the Trustee, as
custodian for the Depository, duly executed by the Company and authenticated by
the Trustee as hereinafter provided (and the Guarantors shall execute the
Guarantees thereon), for credit by the Depository to the respective accounts of
the beneficial owners of the Securities represented thereby (or such other
accounts as they may
25
direct), provided that upon such deposit all such Securities shall be credited
to or through accounts maintained at the Depository by or on behalf of Euroclear
or CEDEL. Until such time as the Restricted Period (as defined below) shall have
expired, such temporary Global Securities, together with their Successor
Securities which are Global Securities other than the Restricted Global
Security, shall be referred to herein as a "Temporary Regulation S Global
Security." After such time as the Restricted Period shall have expired and the
certifications referred to below in the next succeeding paragraph shall have
been provided, interests in such Temporary Regulation S Global Securities shall
be exchanged for interests in like Global Securities, referred to herein
collectively as the "Permanent Regulation S Global Security," substantially in
the form of Security set forth in Exhibit A, with such applicable legends as are
provided for in Exhibit A or Exhibit C. Such Permanent Regulation S Global
Securities shall be registered in the name of the Depository or its nominee and
deposited with the Trustee, as custodian for the Depository, duly executed by
the Company and authenticated by the Trustee as hereinafter provided, for credit
to the respective accounts of the beneficial owners of the Securities
represented thereby (or such other accounts as they may direct). The aggregate
principal amount of the Temporary Regulation S Global Security or the Permanent
Regulation S Global Security may be increased or decreased from time to time by
adjustments made on the records of the Trustee, as custodian for the Depository,
as hereinafter provided. As used herein, the term "Restricted Period" means the
period of 40 days commencing on the day after the latest of (a) the day on which
the Securities are first offered to persons other than distributors (as defined
in Regulation S) in reliance on Regulation S and (b) the date of this Indenture.
Interests in a Temporary Regulation S Global Security may be exchanged
for interests in a Permanent Regulation S Global Security only after (a) the
expiration of the Restricted Period, (b) delivery by a beneficial owner of an
interest therein to Euroclear or CEDEL of a written certification (an "Owner
Securities Certification") substantially in the form of Annex E hereto, and (c)
upon delivery by Euroclear or CEDEL to the Trustee of a written certification (a
"Depository Securities Certification") substantially in the form attached hereto
as Exhibit F. Upon satisfaction of such conditions, the Trustee will exchange
the portion of the Temporary Regulation S Global Security covered by such
certification for interests in a Permanent Regulation S Global Security. The
delivery by such Holder of a beneficial interest in such Temporary Regulation S
Global Security of such certification shall constitute an
26
irrevocable instruction by such holder to Euroclear or CEDEL, as the case may
be, to exchange such Holder's beneficial interest in the Temporary Regulation S
Global Security for a beneficial interest in the Permanent Regulation S Global
Security upon the expiration of the Restricted Period in accordance with the
next succeeding paragraph.
Upon:
(i) the expiration of the Restricted Period;
(ii) receipt by Euroclear or CEDEL, as the case may be, of Owner
Securities Certifications described in the preceding paragraph;
(iii) receipt by the Depository of:
(1) written instructions given in accordance with the Applicable
Procedures from an Agent Member directing the Depository to credit or
cause to be credited to a specified Agent Member's account a beneficial
interest in a Permanent Regulation S Global Security in a principal
amount equal to that of the beneficial interest in a corresponding
Temporary Regulation S Global Security for which the necessary
certifications have been delivered; and
(2) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the Agent
Member, and the Euroclear or CEDEL account for which such Agent
Member's account is held, to be credited with, and the account of the
Agent Member to be debited for, such beneficial interest; and
(iv) receipt by the Trustee of notification from the Depository of the
transactions described in (iii) above and from Euroclear or CEDEL, as the
case may be, of Depository Securities Certifications,
the Trustee, as Registrar, shall instruct the Depository to reduce the principal
amount of such Temporary Regulation S Global Security and to increase the
principal amount of such Permanent Regulation S Global Security, by the
principal amount of the beneficial interest in such Temporary Regulation S
Global Security to be so transferred, and to credit or cause to be credited to
the account of the person specified in such instructions a beneficial interest
in such Permanent Regulation S
27
Global Security having a principal amount equal to the amount by which the
principal amount of such Temporary Regulation S Global Security was reduced upon
such transfer.
Securities offered and sold in their initial distribution in reliance
on Rule 144A under the Securities Act and other than in reliance on Rule 144A
under the Securities Act or Regulation S shall be issued in the form of one or
more Global Securities (collectively, and, together with their Successor
Securities, the "Restricted Global Security") in fully registered form without
interest coupons, substantially in the form of Security set forth in Exhibit A,
with such applicable legends as are provided for in Exhibit A or Exhibit C,
except as otherwise permitted herein. Such Restricted Global Security shall be
registered in the name of the Depository or its nominee and deposited with the
Trustee, as custodian for the Depository, duly executed by the Company and
authenticated by the Trustee as hereinafter provided, for credit by the
Depository to the respective accounts of beneficial owners of the Securities
represented thereby (or such other accounts as they may direct). The aggregate
principal amount of the Restricted Global Security may be increased or decreased
from time to time by adjustments made on the records of the Trustee, as
custodian for the Depository, in connection with a corresponding decrease or
increase in the aggregate principal amount of the Temporary Regulation S Global
Security or the Permanent Regulation S Global Security, as hereinafter provided.
SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall sign, or
one Officer shall sign and one Officer or an Assistant Secretary for the Company
and each Guarantor (each of whom shall, in each case, have been duly authorized
by all requisite corporate actions) shall attest to, the Securities for the
Company and the Guarantees for the Guarantors by manual or facsimile signature.
If an Officer whose signature is on a Security or a Guarantee was an
Officer at the time of such execution but no longer holds that office at the
time the Trustee authenticates the Security, the Security shall nevertheless be
valid.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
28
The Trustee shall authenticate (i) Series A Notes for original issue in
the aggregate principal amount not to exceed $150,000,000 and (ii) one or more
series of Securities for original issue after the Issue Date (such Securities to
be substantially in the form of Exhibit A or Exhibit B hereto) in an aggregate
principal amount not to exceed $85,000,000 (and if in the form of Exhibit A
hereto, the same principal amount of Securities in exchange therefor upon
consummation of a registered exchange offer) in each case, upon receipt of a
written order of the Company in the form of an Officers' Certificate. In each
case, the Officers' Certificate shall specify the amount of Securities to be
authenticated and the date on which the Securities are to be authenticated and
the aggregate principal amount of Securities outstanding on the date of
authentication and whether the Securities are to be Series A Notes, Series B
Notes or Securities issued under clause (ii) of the preceding sentence and shall
further specify the amount of such Securities to be issued as a Global Security
or in certificated form. The aggregate principal amount of Securities
outstanding at any time may not exceed $235,000,000, except as provided in
Section 2.07. Upon the written order of the Company in the form of an Officers'
Certificate, the Trustee shall authenticate Securities in substitution of
Securities originally issued to reflect any name change of the Company.
Series B Notes may be issued only in exchange for a like principal
amount of Series A Notes pursuant to an Exchange Offer.
The principal and interest on Book-Entry Securities shall be payable to
the Depository or its nominee, as the case may be, as the sole registered owner
and the sole holder of the Book-Entry Securities represented thereby. The
principal and interest on Securities in certificated form shall be payable at
the office of the Paying Agent.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company and Affiliates of the Company.
The Securities shall be issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof.
29
If the Securities are to be issued in the form of one or more Global
Securities, then the Company shall execute and the Trustee shall authenticate
and deliver one or more Global Securities that shall represent and shall be in
minimum denominations of $1,000.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, where (a) Securities may be presented or
surrendered for registration of transfer or for exchange ("Registrar"), (b)
Securities may be presented or surrendered for payment ("Paying Agent") and (c)
notices and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company may also from time to time designate one or
more other offices or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in the Borough of Manhattan, The City of New York, for such purposes. Neither
the Company nor any Affiliate of the Company shall act as Paying Agent. The
Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company, upon notice to the Trustee, may have one or more
co-Registrars and one or more additional paying agents reasonably acceptable to
the Trustee. The term "Paying Agent" includes any additional paying agent. The
Company initially appoints the Trustee as Registrar and Paying Agent until such
time as the Trustee has resigned or a successor has been appointed. The initial
office of the Company and the Trustee for purposes of this Section 2.03 shall be
State Street Bank and Trust Company, N.A., 00 Xxxxxxxx, 00xx Xxxxx, XX, XX
00000.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall notify
the Trustee, in advance, of the name and address of any such Agent. If the
Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as
such.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
the Holders or the Trustee
30
all assets held by the Paying Agent for the payment of principal of, or interest
on, the Securities (whether such assets have been distributed to it by the
Company or any other obligor on the Securities), and shall notify the Trustee of
any Default by the Company (or any other obligor on the Securities) in making
any such payment. The Company at any time may require a Paying Agent to
distribute all assets held by it to the Trustee and account for any assets
disbursed and the Trustee may at any time during the continuance of any payment
Default, upon written request to a Paying Agent, require such Paying Agent to
distribute all assets held by it to the Trustee and to account for any assets
distributed. Upon distribution to the Trustee of all assets that shall have been
delivered by the Company to the Paying Agent, the Paying Agent shall have no
further liability for such assets.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders. If the Trustee is not the Registrar, the Company shall furnish to
the Trustee before each Record Date and at such other times as the Trustee may
request in writing a list as of such date and in such form as the Trustee may
reasonably require of the names and addresses of the Holders, which list may be
conclusively relied upon by the Trustee.
SECTION 2.06. Transfer and Exchange.
(a) Beneficial interests in a Global Security may, subject to the
restrictions on the transferability of the Securities and upon delivery of a
certificate in the form of Exhibit D, be exchanged for certificated Securities
upon request but only upon at least 20 days' prior written notice given to the
Trustee by or on behalf of the Depository (in accordance with the Depository's
customary procedures) and will bear the applicable legends set forth in Exhibit
A.
(b) If any Global Security is to be exchanged for other Securities or
canceled in whole, it shall be surrendered by or on behalf of the Depository or
its nominee to the Trustee, as Registrar, for exchange or cancellation as
provided in this Article II. If any Global Security is to be exchanged for other
Securities or canceled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, such Global
Security shall be so surrendered for exchange or cancellation as provided in
this
31
Article II or, if the Trustee is acting as custodian for the Depository or its
nominee (or is party to a similar arrangement) with respect to such Global
Security, the principal amount thereof shall be reduced or increased by an
amount equal to the portion thereof to be so exchanged or canceled, or the
principal amount of such other Security to be so exchanged for a beneficial
interest therein, as the case may be, in each case by means of an appropriate
adjustment made on the records of the Trustee, whereupon the Trustee, in
accordance with the Applicable Procedures, shall instruct the Depository or its
authorized representatives to make a corresponding adjustment to its records
(including by crediting or debiting any Agent Member's account as necessary to
reflect any transfer or exchange of a beneficial interest). Upon any such
surrender or adjustment of a Global Security, the Trustee shall, subject to this
Article II, authenticate and deliver any Securities (and the Guarantors shall
execute the Guarantees thereon) issuable in exchange for such Global Security
(or any portion thereof) to or upon the order of, and registered in such names
as may be directed by, the Depository or its authorized representative and each
of the Guarantors shall execute a Guarantee thereon at the Trustee's request.
Upon the request of the Trustee in connection with the occurrence of any of the
events specified in the preceding paragraph or in paragraph (r) below, the
Company shall promptly make available to the Trustee a reasonable supply of
Securities that are not in the form of Global Securities. The Trustee shall be
entitled to rely upon any order, direction or request of the Depository or its
authorized representative which is given or made pursuant to this Article II if
such order, direction or request is given or made in accordance with the
Applicable Procedures, as certified to the Trustee by the Depository.
(c) Subject to the provisions in the legends required by this
Indenture, the registered Holder may grant proxies and otherwise authorize any
person, including Agent Members and persons who may hold interests in Agent
Members, to take any action that such Holder is entitled to take under this
Indenture.
(d) Neither Agent Members nor any other person on whose behalf Agent
Members may act shall have any rights under this Indenture with respect to any
Global Security held on their behalf by the Depository or under the Global
Security, and the Depository may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of such Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the
32
Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its Agent Members, the
operation of customary practices governing the exercise of the rights of a
Holder of any Security. With respect to any Global Security deposited with the
Trustee as custodian for the Depository for credit to their respective accounts
(or to such other accounts as they may direct) at Euroclear or CEDEL, the
provisions of the "Operating Procedures of the Euroclear System" and the "Terms
and Conditions Governing Use of Euroclear", and the "Management Regulations" and
"Instructions to Participants" of CEDEL, respectively, shall be applicable to
such Global Security, as certifies to the Trustee by Euroclear or CEDEL, as
applicable.
(e) Upon presentation for transfer or exchange of any Security at the
office of the Trustee, as Registrar, located in The City of New York,
accompanied by a written instrument of transfer or exchange in the form approved
by the Company (it being understood that, until notice to the contrary is given
to holders of Securities, the Company shall be deemed to have approved the form
of instrument of transfer or exchange, if any, printed on any Security),
executed by the registered Holder, in person or by such Holder's attorney
thereunto duly authorized in writing, and upon compliance with this Section
2.06, such Security shall be transferred upon the Register, and a new Security
shall be authenticated and issued in the name of the transferee and the
Guarantors shall execute Guarantees thereon. Notwithstanding any provision to
the contrary herein or in the Securities, transfers of a Global Security, in
whole or in part, and transfers of interests therein of the kind described in
this Section 2.06, shall only be made in accordance with this Section 2.06.
Transfers and exchanges subject to this Section 2.06 shall also be subject to
the other provisions of this Indenture that are not inconsistent with this
Section 2.06.
(f) General. A Global Security may not be transferred, in whole or in
part, to any person other than the Depository or a nominee thereof, and no such
transfer to any such other person may be registered; provided, however, that
this clause (f) shall not prohibit any transfer of a Security that is issued in
exchange for a Global Security but is not itself a Global Security. No transfer
of a Security to any person shall be effective under this Indenture or the
Securities unless and until such Security has been registered in the name of
such person. Nothing in this clause (f) shall prohibit or render ineffective any
transfer of a beneficial interest in a Global
33
Security effected in accordance with the other provisions of this Section 2.06.
(g) Temporary Regulation S Global Security. If the holder of a
beneficial interest in a Temporary Regulation S Global Security wishes at any
time to transfer such interest to a person who wishes to take delivery thereof
in the form of a beneficial interest in such Temporary Regulation S Global
Security, such transfer may be effected, subject to the rules and procedures of
the Depository, Euroclear and CEDEL, in each case to the extent applicable and
as in effect from time to time (the "Applicable Procedures"), only in accordance
with this clause (g). Upon delivery (i) by a beneficial owner of an interest in
a Temporary Regulation S Global Security to Euroclear or CEDEL, as the case may
be, of an Owner Securities Certification, (ii) by the transferee of such
beneficial interest in the Temporary Regulation S Global Security to Euroclear
or CEDEL, as the case may be, of a written certification (a "Transferee
Securities Certification") substantially in the form of Exhibit G hereto and
(iii) by Euroclear or CEDEL, as the case may be, to the Trustee, as Registrar,
of a Depository Securities Certification, the Trustee may direct either
Euroclear or CEDEL, as the case may be, to reflect on its records the transfer
of a beneficial interest in the Temporary Regulation S Global Security from the
beneficial owner providing the Owner Securities Certification to the person
providing the Transferee Securities Certification.
(h) Restricted Global Security to Temporary Regulation S Global
Security. If the holder of a beneficial interest in the Restricted Global
Security wishes at any time to transfer such interest to a person who wishes to
take delivery thereof in the form of a beneficial interest in the Temporary
Regulation S Global Security, such transfer may be effected, subject to the
Applicable Procedures, only in accordance with the provisions of this clause (h)
and clause (n)
34
below. Upon receipt by the Trustee, as Registrar, of (A) written instructions
given by or on behalf of the Depository in accordance with the Applicable
Procedures directing the Trustee to credit or cause to be credited to a
specified Agent Member's account a beneficial interest in the Temporary
Regulation S Global Security in a specified principal amount and to cause to be
debited from another specified Agent Member's account a beneficial interest in
the Restricted Global Security in an equal principal amount and (B) a
certificate in substantially the form set forth in Exhibit H signed by or on
behalf of the holder of such beneficial interest in the Restricted Global
Security, the Trustee, as Security Registrar, shall, subject to clause (n)
below, reduce the principal amount of the Restricted Global Security, and
increase the principal amount of the Temporary Regulation S Global Security by
such specified principal amount.
(i) Restricted Global Security to Permanent Regulation S Global
Security. If the holder of a beneficial interest in the Restricted Global
Security wishes at any time to transfer such interest to a person who wishes to
take delivery thereof in the form of a beneficial interest in the Permanent
Regulation S Global Security, such transfer may be effected, subject to the
Applicable Procedures, only in accordance with this clause (i). Upon receipt by
the Trustee, as Security Registrar, of (A) written instructions given by or on
behalf of the Depository in accordance with the Applicable Procedures directing
the Trustee to credit or cause to be credited to a specified Agent Member's
account a beneficial interest in the Permanent Regulation S Global Security in a
specified principal amount and to cause to be debited from another specified
Agent Member's account a beneficial interest in the Restricted Global Security
in an equal principal amount and (B) a certificate in substantially the form set
forth in Exhibit I signed by or on behalf of the holder of such beneficial
interest in the Restricted Global Security, the Trustee, as Registrar, shall
reduce the principal amount of a Restricted Global Security, and increase the
principal amount of the Permanent Regulation S Global Security by such specified
principal amount.
(j) Temporary Regulation S Global Security or Permanent Regulation S
Global Security to Restricted Global Security. If the holder of a beneficial
interest in the Temporary Regulation S Global Security or the Permanent
Regulation S Global Security at any time, wishes to transfer such interest to a
person who wishes to take delivery thereof in the form of a beneficial interest
in the Restricted Global Security, such transfer may be effected, subject to the
Applicable Procedures, only in accordance with this clause (j) and clause (n)
below; provided that with respect to any transfer of a beneficial interest in a
Temporary Regulation S Global Security, the transferor and Euroclear or CEDEL,
as the case may be, must have previously delivered an Owner Securities
Certification and a Depository Securities Certification respectively, with
respect to such beneficial interest. Upon receipt by the Trustee, as Registrar,
of (A) written instructions given by or on behalf of the Depository in
accordance with the Applicable Procedures directing the Trustee to credit or
cause to be credited to a specified Agent Member's account a beneficial interest
in the Restricted Global Security in a specified principal amount and
35
to cause to be debited from another specified Agent Member's account a
beneficial interest in the Temporary Regulation S Global Security or the
Permanent Regulation S Global Security, as the case may be, in an equal
principal amount and (B) a certificate in substantially the form set forth in
Exhibit J signed by or on behalf of the holder of such beneficial interest in
the Temporary Regulation S Global Security or the Permanent Regulation S Global
Security, as the case may be, the Trustee, as Security Registrar, shall, subject
to clause (n) below, reduce the principal amount of such Temporary Regulation S
Global Security or Permanent Regulation S Global Security, as the case may be,
and increase the principal amount of the Restricted Global Security by such
specified principal amount.
(k) Non-Global Restricted Security to Global Security. If the holder of
a Restricted Security (other than a Global Security) wishes at any time to
transfer all or any portion of such Security to a person who wishes to take
delivery thereof in the form of a beneficial interest in the Restricted Global
Security, the Temporary Regulation S Global Security or the Permanent Regulation
S Global Security, such transfer may be effected, subject to the Applicable
Procedures, only in accordance with this clause (k) and clause (n) below. Upon
receipt by the Trustee, as Registrar, of (A) such Security and written
instructions given by or on behalf of such Holder as provided in this Section
2.06 directing the Trustee to credit or cause to be credited to a specified
Agent Member's account a beneficial interest in the Restricted Global Security,
the Temporary Regulation S Global Security or the Permanent Regulation S Global
Security, as the case may be, in a specified principal amount equal to the
principal amount of the Restricted Security (or portion thereof) to be so
transferred, and (B) an appropriately completed certificate substantially in the
form set forth in Exhibit K-1 hereto, if the specified account is to be credited
with a beneficial interest in the Restricted Global Security, or Exhibit K-2
hereto, if the specified account is to be credited with a beneficial interest in
the Temporary Regulation S Global Security or the Permanent Regulation S Global
Security, signed by or on behalf of such Holder, then the Trustee, as Registrar,
shall, subject to clause (n) below, cancel such Restricted Security (and issue a
new Security in respect of any untransferred portion thereof) as provided in
this Section 2.06 and increase the principal amount of the Restricted Global
Security, Temporary Regulation S Global Security or Permanent Regulation S
Global Security, as the case may be, by the specified principal amount.
36
(l) Non-Global Permanent Regulation S Security to Restricted Global
Security or Permanent Regulation S Global Security. If the Holder of a Permanent
Regulation S Security (other than a Global Security) wishes at any time to
transfer all or any portion of such Security to a person who wishes to take
delivery thereof in the form of a beneficial interest in the Restricted Global
Security or the Permanent Regulation S Global Security, as the case may be, such
transfer may be effected only in accordance with this clause (l) and subject to
the Applicable Procedures. Upon receipt by the Trustee, as Registrar, of (A)
such Security and instructions given by or on behalf of such Holder as provided
in this Section 2.06 directing the Trustee to credit or cause to be credited to
a specified Agent Member's account a beneficial interest in the Restricted
Global Security or the Permanent Regulation S Global Security, as the case may
be, in a principal amount equal to the principal amount of the Security (or
portion thereof) to be so transferred, and (B)(i) with respect to a transfer
which is to be delivered in the form of a beneficial interest in the Restricted
Global Security, a certificate in substantially the form set forth in Exhibit
L-1, signed by or on behalf of such Holder, and (ii) with respect to a transfer
which is to be delivered in the form of a beneficial interest in the Permanent
Regulation S Global Security, a certificate in substantially the form set forth
in Exhibit L-2, signed by or on behalf of such Holder, then the Trustee, as
Registrar, shall, subject to Clause (9) below, cancel such Security (and issue a
new Security in respect of any untransferred portion thereof) as provided in
this Section 2.06 and increase the principal amount of the Restricted Global
Security, or the Permanent Regulation S Global Security, as the case may be, by
the specified principal.
(m) Other Exchanges. Securities that are not Global Securities may be
exchanged (on transfer or otherwise) for Securities that are not Global
Securities or for beneficial interests in a Global Security (if any is then
outstanding) only in accordance with such procedures, which shall be
substantially consistent with the provisions of clauses (f) through (l) above
(including the certification requirements intended to insure that transfers of
beneficial interests in a Global Security comply with Rule 144A under the
Securities Act, Rule 144 under the Securities Act or Regulation S, as the case
may be) and any Applicable Procedures, as may be from time to time adopted by
the Company and the Trustee.
(n) Interests in Temporary Regulation S Global Security To Be Held
Through Euroclear or CEDEL. Until the later of
37
the expiration of the Restricted Period and the provision of the Owner
Securities Certification and the Depository Securities Certification, beneficial
interests in any Temporary Regulation S Global Security may be held only in or
through accounts maintained at the Depository by Euroclear or CEDEL (or by Agent
Members acting for the account thereof).
(o) When Securities in certificated form are presented to the Registrar
or a co-Registrar with a request to register the transfer of such Securities or
to exchange such Securities for an equal principal amount of Securities of other
authorized denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested if its requirements for such
transaction are met; provided, however, that the Securities surrendered for
transfer or exchange shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Registrar or
co-Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing. To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Securities (and the
Guarantors shall execute the Guarantors thereon) at the Registrar's or
co-Registrar's request. No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchanges or transfers pursuant to Sections 2.02, 2.10, 3.07, 4.15,
4.16 or 9.05). The Registrar or co-Registrar shall not be required to register
the transfer of or exchange of any Security (i) during a period beginning at the
opening of business 15 days before the mailing of a notice of redemption of
Securities and ending at the close of business on the day of such mailing and
(ii) selected for redemption in whole or in part pursuant to Article Three,
except the unredeemed portion of any Security being redeemed in part.
(p) If a Series A Note is a Restricted Security in certificated form,
then as provided in this Indenture and subject to the limitations herein set
forth, the Holder, provided it is a Qualified Institutional Buyer, may exchange
such Security for a Book-Entry Security by instructing the Trustee (by
completing the Transferee Certificate in the form of Exhibit D hereto) to
arrange for such Series A Note to be represented by a beneficial interest in a
Global Security in accordance with the customary procedures of the Depository.
38
(q) Upon any exchange provided for in Section 2.06(a), the Company
shall execute and the Trustee shall authenticate and deliver to the person
specified by the Depository a new Series A Note or Series A Notes registered in
such names and in such authorized denominations as the Depository, pursuant to
the instructions of the beneficial owner of the Securities requesting the
exchange, shall instruct the Trustee. Thereupon, the beneficial ownership of
such Global Security shown on the records maintained by the Depository or its
nominee shall be reduced by the amounts so exchanged and an appropriate
endorsement shall be made by or on behalf of the Trustee on the Global Security.
Any such exchange shall be effected through the Depository in accordance with
the procedures of the Depository therefor.
(r) Notwithstanding the foregoing, no Global Security shall be
registered for transfer or exchange, or authenticated and delivered, whether
pursuant to this Section, Section 2.07, 2.10 or 3.07 or otherwise, in the name
of a person other than the Depository for such Global Security or its nominee
until (i) the Depository notifies the Company that it is unwilling or unable to
continue as Depository for such Global Security or if at any time the Depository
ceases to be a clearing agency registered under the Exchange Act, and a
successor depository is not appointed by the Company within 30 days, (ii) the
Company executes and delivers to the Trustee a Company order that all such
Global Securities shall be exchangeable or (iii) there shall have occurred and
be continuing an Event of Default. Upon the occurrence in respect of any Global
Security representing the Series A Notes of any one or more of the conditions
specified in clause (i), (ii) or (iii) of the preceding sentence, such Global
Security may be registered for transfer or exchange for Series A Notes
registered in the names of, authenticated and delivered to such persons as the
Trustee or the Depository, as the case may be, shall direct.
(s) Except as provided above, any Security authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, any Global
Security, whether pursuant to this Section, Section 2.07, 2.10 or 3.07 or
otherwise, shall also be a Global Security and bear the legend specified in
Exhibit C.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Company shall issue
39
and the Trustee shall authenticate a replacement Security (and the Guarantors
shall execute the Guarantees thereon) if the Trustee's requirements are met. If
required by the Trustee or the Company, such Holder must provide an indemnity
bond or other indemnity, sufficient in the judgment of the Company, the
Guarantors and the Trustee, to protect the Company, the Guarantors, the Trustee
or any Agent from any loss which any of them may suffer if a Security is
replaced. The Company may charge such Holder for its reasonable out-of-pocket
expenses in replacing a Security, including reasonable fees and expenses of
counsel. Every replacement Security shall constitute an additional obligation of
the Company and the Guarantors.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those canceled by it, those delivered
to it for cancellation and those described in this Section as not outstanding. A
Security does not cease to be outstanding because the Company or any of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section
2.07.
If on a Redemption Date or the Maturity Date the Paying Agent holds
U.S. Legal Tender or U.S. Government Obligations sufficient to pay all of the
principal and interest due on the Securities payable on that date, then on and
after that date such Securities cease to be outstanding and interest on them
ceases to accrue; provided, however, that to the extent the Trustee is enjoined
from making payments to the Holders, interest will continue to accrue until such
time as the Trustee is not so enjoined.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or an Affiliate of the Company shall be disregarded, except that,
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent,
40
only Securities that the Trustee knows are so owned shall be disregarded.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities (and the
Guarantors shall execute the guarantees thereon) upon receipt of a written order
of the Company in the form of an Officers' Certificate. The Officers'
Certificate shall specify the amount of temporary Securities to be authenticated
and the date on which the temporary Securities are to be authenticated.
Temporary Securities shall be substantially in the form of definitive Securities
but may have variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate and the Guarantors shall execute Guarantees on, upon
receipt of a written order of the Company pursuant to Section 2.02, definitive
Securities in exchange for temporary Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for transfer, exchange or payment. The
Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent,
and no one else, shall cancel and, at the written direction of the Company,
shall dispose of all Securities surrendered for transfer, exchange, payment or
cancellation. Subject to Section 2.07, the Company may not issue new Securities
to replace Securities that it has paid or delivered to the Trustee for
cancellation. If the Company shall acquire any of the Securities, such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Securities, it
shall, unless the Trustee fixes another record date pursuant to Section 6.10,
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest to the persons who are Holders on a subsequent special
record date, which date shall be the fifteenth day next preceding the date fixed
by the Company for the payment of
41
defaulted interest or the next succeeding Business Day if such date is not a
Business Day. At least 15 days before the subsequent special record date, the
Company shall mail to each Holder, with a copy to the Trustee, a notice that
states the subsequent special record date, the payment date and the amount of
defaulted interest, and interest payable on such defaulted interest, if any, to
be paid.
SECTION 2.13. CUSIP Number.
The Company in issuing the Securities may use a CUSIP number or
numbers, and if so, the Trustee shall use the CUSIP number or numbers in notices
of redemption or exchange as a convenience to Holders; provided that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP number or numbers printed in the notice or on the
Securities, and that reliance may be placed only on the other identification
numbers printed on the Securities.
SECTION 2.14. Designation.
The Indebtedness evidenced by the Securities and the Guarantees is
hereby irrevocably designated as "senior indebtedness" or such other term
denoting seniority (i) for all purposes of the provisions defining subordination
contained in agreements that provide that the Indebtedness of the Company issued
pursuant to such agreements is subordinate to Indebtedness designated as senior
indebtedness and (ii) for the purposes of any future Indebtedness of the Company
which the Company expressly makes subordinate to any senior indebtedness or such
other term denoting seniority. In connection with the issuance of any such
future subordinated Indebtedness, the Company shall take all necessary steps to
effectuate the foregoing.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Optional Redemption.
(a) The Securities will be subject to redemption, in whole or in part,
at the option of the Company, at any time on or after May 15, 2002, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued
42
interest to the redemption date, if redeemed during the 12 month
period beginning on May 15 of the years indicated below:
Year Percentage
---- ----------
2002...................................... 105.750%
2003...................................... 102.875%
2004 and thereafter....................... 100.000%
(b) In addition, at any time prior to May 15, 2001, the Company may
redeem up to 35% of the sum of (x) the aggregate principal amount of the
Securities issued on the Issue Date plus (y) the aggregate principal amount of
any additional Securities issued after the Issue Date pursuant to this
Indenture, with the proceeds of one or more Equity Offerings at a redemption
price (expressed as a percentage of principal amount) of 111.5% plus accrued
interest to the redemption date; provided that at least 65% of the sum of (x)
the aggregate principal amount of Securities issued on the Issue Date plus (y)
the aggregate principal amount of any additional Securities issued after the
Issue Date pursuant to this Indenture remains outstanding immediately after any
such redemption. In order to effect the foregoing redemption with the proceeds
of any Equity Offering, the Company shall make such redemption not more than 120
days after the consummation of any such Equity Offering.
SECTION 3.02. Notices to Trustee.
If the Company elects to redeem Securities pursuant to this Indenture
and the Securities, it shall notify the Trustee and the Paying Agent in writing
of the Redemption Date and the principal amount of the Securities to be redeemed
and whether it wants the Trustee to give notice of redemption to the Holders (at
the Company's expense) at least 30 days (unless a shorter notice shall be
satisfactory to the Trustee) but not more than 60 days before the Redemption
Date. Any such notice may be canceled at any time prior to notice of such
redemption being mailed to any Holder and shall thereby be void and of no
effect.
SECTION 3.03. Selection of Securities To Be Redeemed.
If less than all of the Securities are to be redeemed at any time, the
Trustee shall select the Securities to be redeemed in compliance with the
requirements of the principal national securities exchange, if any, on which the
Securities being redeemed are listed or, if the Securities are not listed on a
national securities exchange, on a pro rata basis, by lot or
43
by such other method as the Trustee shall deem fair and appropriate.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Company
in writing of the Securities selected for redemption and, in the case of any
Security selected for partial redemption, the principal amount thereof to be
redeemed. Securities in denominations of $1,000 or less may be redeemed only in
whole. The Trustee may select for redemption portions (equal to $1,000 or any
integral multiple thereof) of the principal of Securities that have
denominations larger than $1,000. If a redemption is to be made with the
proceeds of an Equity Offering pursuant to Section 3.01(b), selection of the
Securities for redemption shall be made by the Trustee only on a pro rata basis
unless such method is otherwise prohibited. Provisions of this Indenture that
apply to Securities called for redemption also apply to portions of Securities
called for redemption.
SECTION 3.04. Notice of Redemption.
Except as otherwise provided in Section 3.01, at least 30 days but not
more than 60 days before a Redemption Date the Company shall mail a notice of
redemption by first class mail to each Holder whose Securities are to be
redeemed, with a copy to the Trustee. At the Company's request, the Trustee
shall give the notice of redemption in the Company's name and at the Company's
expense. Each notice for redemption shall identify the Securities to be redeemed
and shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(5) that, unless the Company defaults in making the redemption payment,
interest on Securities called for redemption ceases to accrue on and after
the Redemption Date, and the only remaining right of the Holders of such
Securities is to receive payment of the Redemption Price upon surrender to
the Paying Agent of the Securities redeemed;
44
(6) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the
Redemption Date, and upon surrender of such Security, a new Security or
Securities in the aggregate principal amount equal to the unredeemed portion
thereof will be issued;
(7) if fewer than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Securities to be
redeemed and the aggregate principal amount of Securities to be outstanding
after such partial redemption; and
(8) the CUSIP number, if any, relating to such Securities.
SECTION 3.05. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.04,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price. Upon surrender to the Trustee or Paying Agent, such
Securities called for redemption shall be paid at the Redemption Price plus
accrued interest to the Redemption Date, but interest installments whose
maturity is on or prior to such Redemption Date will be payable on the relevant
Interest Payment Dates to the Holders of record at the close of business on the
relevant Record Dates referred to in the Securities.
SECTION 3.06. Deposit of Redemption Price.
On or before the Redemption Date, the Company shall deposit with the
Paying Agent U.S. Legal Tender sufficient and timely to pay the Redemption Price
of all Securities to be redeemed on that date (other than Securities or portions
thereof called for redemption on that date which have been delivered by the
Company to the Trustee for cancellation). The Paying Agent shall promptly return
to the Company any U.S. Legal Tender so deposited which is not required for that
purpose upon the written request of the Company, except with respect to monies
owed as obligations to the Trustee pursuant to Article Seven.
If the Company complies with the preceding paragraph, then, unless the
Company defaults in the payment of such Redemption Price, interest on the
Securities to be redeemed will cease to accrue on and after the applicable
Redemption Date, whether or not such Securities are presented for payment.
45
SECTION 3.07. Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part, the
Trustee shall authenticate for the Holder a new Security or Securities equal in
principal amount to the unredeemed portion of the Security surrendered.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities. An installment of
principal of or interest on the Securities shall be considered paid on the date
it is due if the Trustee or Paying Agent holds on that date U.S. Legal Tender
designated for and sufficient and timely to pay the installment. Interest on the
Securities will be computed on the basis of a 360-day year comprised of twelve
30-day months.
The Company shall pay interest on overdue principal and (to the extent
permitted by law) on overdue installments of interest at a rate equal to 13 1/2%
per annum.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City of New
York, the office or agency required under Section 2.03. The Company shall give
prior notice to the Trustee of the location, and any change in the location, of
such office or agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the address of the Trustee set forth in Section 10.02.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Company will
give prompt written notice to
46
the Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.
The Company hereby initially designates the office of State Street Bank
and Trust Company, Xxxxxxx Square, 225 Asylum, 00xx Xxxxx, Xxxxxxxx, XX 00000,
as such office of the Company in accordance with this Section 4.02.
SECTION 4.03. Limitation on Restricted Payments.
The Company will not, and will not permit any of the Restricted
Subsidiaries to, directly or indirectly, after the Issue Date (a) declare or pay
any dividend or make any distribution on the Company's Capital Stock or make any
payment to holders of such Capital Stock (other than dividends or distributions
payable in Qualified Capital Stock of the Company or repayment of Indebtedness
except as provided in clause (c) below), (b) purchase, redeem or otherwise
acquire or retire for value any Capital Stock of the Company or any warrants,
rights or options to purchase or acquire shares of any class of such Capital
Stock, (c) purchase, redeem, prepay, defease or otherwise acquire or retire for
value, prior to any scheduled maturity, scheduled repayment or scheduled sinking
fund payment, Indebtedness of the Company or any of the Guarantors that is
expressly subordinate in right of payment to the Securities or the Guarantee of
such Guarantor, as the case may be, or (d) make any Investment (excluding any
Permitted Investment) (each of the foregoing actions set forth in clauses (a),
(b), (c) and (d) being referred to as a "Restricted Payment"), if at the time of
such Restricted Payment or immediately after giving effect thereto, (i) a
Default or an Event of Default shall have occurred and be continuing or (ii)
Restricted Payments made subsequent to the Issue Date (the amount expended for
such purposes, if other than in cash, shall be the Fair Market Value of such
property proposed to be transferred by the Company or such Restricted
Subsidiary, as the case may be, pursuant to such Restricted Payment) shall
exceed the sum of:
(w) 50% of the cumulative Consolidated Net Income (or if cumulative
Consolidated Net Income shall be a loss, minus 100% of such loss) of the
Company earned subsequent to the Issue Date and prior to the date the
Restricted Payment occurs (treating such period as a single accounting
period);
(x) 100% of the aggregate net proceeds, including the Fair Market Value
of property other than cash, received by the Company from any person (other
than a Subsidiary
47
of the Company) from the issuance and sale subsequent to the Issue Date of
Qualified Capital Stock of the Company (excluding (A) Qualified Capital
Stock paid as a dividend on any Capital Stock or as interest on any
Indebtedness, (B) any net proceeds from issuances and sales financed
directly or indirectly using funds borrowed from the Company or any
Subsidiary of the Company, until and to the extent such borrowing is repaid
and (C) any net proceeds from any Equity Offering which are used to redeem
the Securities pursuant to, and in accordance with, the provisions under
Section 3.01(b);
(y) 100% of the aggregate net proceeds, including the Fair Market Value
of property other than cash, received by the Company from any person (other
than a Subsidiary of the Company) from the issuance and sale of Disqualified
Capital Stock and/or Indebtedness, in each case that has been converted into
or exchanged for, pursuant to the terms of such Indebtedness, Qualified
Capital Stock of the Company after the Issue Date; and
(z) without duplication, the sum of (1) the aggregate amount returned
in cash on or with respect to Investments (other than Permitted Investments)
made subsequent to the Issue Date whether through interest payments,
principal payments, dividends or other distributions or payments, (2) the
net cash proceeds received by the Company or any Restricted Subsidiary from
the disposition of all or any portion of such Investments (other than to a
Subsidiary of the Company) and (3) upon redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary, the Fair Market Value of such
Subsidiary; provided, however, that the sum of clauses (1),(2) and (3) above
shall not exceed the aggregate amount of all such Investments made
subsequent to the Issue Date.
The foregoing provisions shall not prohibit:
(1) the payment of any dividend within 60 days after the date of its
declaration if the dividend would have been permitted on the date of
declaration;
(2) the acquisition of Capital Stock of the Company or Indebtedness of
the Company or any Guarantor either (i) solely in exchange for shares of
Qualified Capital Stock of the Company or (ii) through the application of
net proceeds of a substantially concurrent sale for cash
48
(other than to a Subsidiary of the Company) of shares of Qualified Capital
Stock of the Company;
(3) the acquisition of Indebtedness of the Company or any Guarantor
that is expressly subordinate in right of payment to the Securities or such
Guarantor's Guarantee, as the case may be, either (i) solely in exchange for
Indebtedness of the Company or such Guarantor which is expressly subordinate
in right of payment to the Securities or such Guarantor's Guarantee, as the
case may be, at least to the extent that the Indebtedness being acquired is
subordinated to the Securities or such Guarantor's Guarantee, as the case
may be, and has no scheduled principal prepayment dates prior to the
scheduled final maturity date of the Indebtedness being exchanged or (ii)
through the application of net proceeds of a substantially concurrent sale
for cash (other than to a Subsidiary of the Company) of Indebtedness of the
Company or such Guarantor which is expressly subordinate in right of payment
to the Securities or such Guarantor's Guarantee, as the case may be, at
least to the extent that the Indebtedness being acquired is subordinated to
the Securities or such Guarantor's Guarantee, as the case may be, and has no
scheduled principal prepayment dates prior to the scheduled final maturity
date of the Indebtedness being refinanced;
(4) the making of payments by the Company or any of the Restricted
Subsidiaries to Renco (A) no earlier than ten days prior to the date on
which Renco is required to make its payments to the Internal Revenue Service
or the applicable state taxing authority, as the case may be, pursuant to a
tax sharing agreement (which tax sharing agreement provides that the
payments thereunder shall not exceed the amount the Company and its
Subsidiaries would have been required to pay for taxes on a stand-alone
basis, except that the Company and its Subsidiaries will not have the
benefit of any of its tax loss carryforwards unless such tax losses were a
result of timing differences between the Company's and its Subsidiaries'
accounting for tax and financial reporting purposes, and which tax sharing
agreement also provides that transactions between the Company and Renco and
Renco's other Subsidiaries are accounted for on a cash basis and not on an
accrual basis) and (B) to reimburse Renco for out of pocket insurance or
surety bond payments made by Renco on behalf of the Company and its
Subsidiaries;
49
(5) the payment by the Company or any of the Restricted Subsidiaries of
a management fee to Renco in an amount not to exceed $1.2 million in any
fiscal year; and
(6) the payment by the Company of (i) a dividend to Renco on the Issue
Date in the aggregate amount not to exceed $28.0 million and (ii) accrued
and unpaid management fees to Renco on the Issue Date in an aggregate amount
not to exceed $700,000;
provided that in the case of clauses (2), (3) and (5), no Default or Event of
Default shall have occurred and be continuing at the time of such payment or as
a result thereof.
In determining the aggregate amount of Restricted Payments permissible
under clause (ii) of the first paragraph of this section, amounts expended,
incurred or outstanding pursuant to clauses (1) and (2) (but not pursuant to
clauses (3), (4), (5) or (6)) of the second paragraph of this section shall be
included as Restricted Payments; provided that any proceeds received from the
issuance of Qualified Capital Stock pursuant to clause (2) of the second
paragraph of this section shall be included in calculating the amount referred
to in clause (x) or clause (y), as the case may be, of the first paragraph of
this Section 4.03.
SECTION 4.04. Corporate Existence.
Except as otherwise permitted by Article Five, each of the Company and
the Guarantors shall do or cause to be done all things necessary to preserve and
keep in full force and effect its corporate existence and the corporate or other
existence of each of its Subsidiaries in accordance with the respective
organizational documents of each such Subsidiary and the rights (charter and
statutory) and franchises of each of the Company and the Guarantors and each
such Subsidiary; provided, however, that each of the Company and the Guarantors
shall not be required to preserve, with respect to itself, any right or
franchise, and with respect to any of its Subsidiaries any such existence, right
or franchise, if the Board of Directors of each of the Company and the
Guarantors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of each of the Company and the Guarantors and
will not be adverse in any material respect to the Holders.
50
SECTION 4.05. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon it or any of its Subsidiaries or
properties of it or any of its Subsidiaries and (ii) all lawful claims for
labor, materials and supplies that, if unpaid, might by law become a Lien upon
the property of it or any of its Subsidiaries; provided, however, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim if either (a) the amount,
applicability or validity thereof is being contested in good faith by
appropriate proceedings and an adequate reserve has been established therefor to
the extent required by GAAP or (b) the failure to make such payment or effect
such discharge (together with all other such failures) would not have a material
adverse effect on the financial condition or results of operations of the
Company and its Subsidiaries, taken as a whole.
SECTION 4.06. Maintenance of Properties and Insurance.
(a) Each of the Company and the Guarantors shall cause all
properties used or useful in the conduct of its business or the business of any
of its Subsidiaries to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment and shall cause to be
made all necessary repairs, renewals, replacements, betterments and improvements
thereof, all as in its judgment may be necessary, so that the business carried
on in connection therewith may be properly and advantageously conducted at all
times unless the failure to so maintain such properties (together with all other
such failures) would not have a material adverse effect on the financial
condition or results of operations of the Company and the Guarantors and their
Subsidiaries taken as a whole; provided, however, that nothing in this Section
4.06 shall prevent the Company and the Guarantors or any of their Subsidiaries
from discontinuing the operation or maintenance of any of such properties, or
disposing of any of them, if such discontinuance or disposal is either (i) in
the ordinary course of business, (ii) in the good faith judgment of the Board of
Directors of the Company or the Guarantors or the Subsidiary concerned, or of
the senior officers of the Company or the Guarantors or such Subsidiary, as the
case may be, desirable in the conduct of the business of the Company or the
Guarantors or
51
such Subsidiary, as the case may be, or (iii) is otherwise permitted by this
Indenture.
(b) Each of the Company and the Guarantors shall provide or cause to be
provided, for itself and each of its Subsidiaries, insurance (including
appropriate self-insurance) against loss or damage of the kinds that, in the
reasonable, good faith opinion of each of the Company and the Guarantors are
adequate and appropriate for the conduct of the business of the Company and the
Guarantors and such Subsidiaries in a prudent manner, with reputable insurers or
with the government of the United States of America or an agency or
instrumentality thereof, in such amounts, with such deductibles, and by such
methods as shall be customary, in the reasonable, good faith opinion of each of
the Company and the Guarantors, for companies similarly situated in the
industry, unless the failure to provide such insurance (together with all other
such failures) would not have a material adverse effect on the financial
condition or results of operations of each of the Company and the Guarantors and
its Subsidiaries, taken as a whole.
SECTION 4.07. Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee, within 60 days after the
end of the Company's fiscal quarters and within 90 days after the end of the
Company's fiscal year, an Officers' Certificate stating that a review of its
activities and the activities of its Subsidiaries during the preceding fiscal
period has been made under the supervision of the signing Officers with a view
to determining whether it has kept, observed, performed and fulfilled its
obligations under this Indenture and further stating, as to each such Officer
signing such certificate, that to the best of his knowledge, the Company during
such preceding fiscal period has kept, observed, performed and fulfilled each
and every such covenant and no Default or Event of Default occurred during such
period and at the date of such certificate there is no Default or Event of
Default that has occurred and is continuing or, if such signers do know of such
Default or Event of Default, the certificate shall describe the Default or Event
of Default and its status with particularity. The Officers' Certificate shall
also include all calculations necessary to show covenant compliance. The
Officers' Certificate shall also notify the Trustee should the Company elect to
change the manner in which it fixes its fiscal year end.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants,
52
the Company shall deliver to the Trustee within 90 days after the end of each
fiscal year a written statement by its independent certified public accountants
stating (A) that its audit examination has included a review of the terms of
this Indenture and the Securities as they relate to accounting matters, and (B)
whether, in connection with its audit examination, any Default or Event of
Default has come to its attention and if such a Default or Event of Default has
come to its attention, specifying the nature and period of existence thereof.
(c) The Company will deliver to the Trustee as soon as possible, and in
any event within 10 days after the Company becomes aware or should reasonably
have become aware of the occurrence of any Default or Event of Default, an
Officers' Certificate specifying such Default or Event of Default and what
action the Company is taking or proposes to take with respect thereto.
SECTION 4.08. Compliance with Laws.
Each of the Company and the Guarantors shall comply, and shall cause
each of its Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all states
and municipalities thereof, and of any governmental department, commission,
board, regulatory authority, bureau, agency and instrumentality of the
foregoing, in respect of the conduct of their respective businesses and the
ownership of their respective properties, except such as are being contested in
good faith and by appropriate proceedings and except for such noncompliances as
would not in the aggregate have a material adverse effect on the financial
condition or results of operations of each of the Company and the Guarantors and
its Subsidiaries taken as a whole.
SECTION 4.09. SEC Reports and Other Information.
(a) At all times when the Company is required or permitted voluntarily
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act or this
Indenture is qualified under the TIA, the Company (at its own expense) shall
file with the SEC and shall file with the Trustee and mail or cause the Trustee
to mail to the Holders at their addresses set forth in the register of
Securities within 15 days after it files them with the SEC copies of the annual
reports, quarterly reports and the information, documents, and other reports (or
copies of such portions of any of the foregoing as the SEC may by rules and
regulations prescribe) to be filed pursuant to Section 13
53
or 15(d) of the Exchange Act. If the Company is not subject to the requirements
of such Section 13 or 15(d) of the Exchange Act and not permitted to voluntarily
file and this Indenture has not been qualified under the TIA, the Company (at
its own expense) shall file with the Trustee and mail or cause the Trustee to
mail to the Holders at their addresses set forth in the register of Securities,
within 15 days after it would have been required to file such information with
the SEC, all information and financial statements, including any notes thereto
and with respect to annual reports, quarterly reports, an auditors' report by an
accounting firm of established national reputation, and a "Management's
Discussion and Analysis of Financial Condition and Results of Operations," both
comparable to the disclosure that the Company would have been required to
include in such annual reports, quarterly reports, information, documents or
other reports, as if the Company was subject to the requirements of such Section
13 or 15(d) of the Exchange Act, in each case in the form that would have been
required by the SEC. Upon qualification of this Indenture under the TIA, the
Company shall also comply with the provisions of TIA ss. 314(a).
(b) At any time when the Company is not subject to Section 13 or 15(d)
of the Exchange Act, upon the request of a Holder of a Series A Note, the
Company will promptly furnish or cause to be furnished such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor
provision thereto) to such Holder or to a prospective purchaser of such Series A
Note designated by such Holder, as the case may be, in order to permit
compliance by such Holder with Rule 144A under the Securities Act.
SECTION 4.10. Waiver of Stay, Extension or Usury Laws.
Each of the Company and the Guarantors covenants (to the extent that it
may lawfully do so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law that would prohibit or forgive the
each of Company and the Guarantors from paying all or any portion of the
principal of or interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) each of the Company and the Guarantors hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit
54
the execution of every such power as though no such law had been enacted.
SECTION 4.11. Limitation on Transactions with Affiliates.
(a) The Company will not, and will not permit any of the Restricted
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction (including, without limitation, the purchase, sale, lease or
exchange of any property or the rendering of any service) with or for the
benefit of an Affiliate of the Company or any Restricted Subsidiary (other than
transactions between the Company and a Restricted Subsidiary or between
Restricted Subsidiaries) (an "Affiliate Transaction"), other than (x) Affiliate
Transactions permitted under (b) below and (y) Affiliate Transactions (including
lease transactions) on terms that are no less favorable to the Company or the
relevant Restricted Subsidiary in the aggregate than those that might reasonably
have been obtained in a comparable transaction by the Company or such Restricted
Subsidiary on an arm's-length basis (as determined in good faith by the Board of
Directors of the Company, as evidenced by a Board Resolution) from a person that
is not an Affiliate; provided that except as otherwise provided under (b) below,
neither the Company nor any of the Restricted Subsidiaries shall enter into an
Affiliate Transaction or series of related Affiliate Transactions involving or
having a value of more than $5.0 million unless the Company or such Restricted
Subsidiary, as the case may be, has received an opinion from an Independent
Financial Advisor, with a copy thereof to the Trustee, to the effect that the
financial terms of such Affiliate Transaction are fair and reasonable to the
Company or such Restricted Subsidiary, as the case may be, and such terms are no
less favorable to the Company or such Restricted Subsidiary, as the case may be,
than those that could be obtained in a comparable transaction on an arm's-length
basis with a person that is not an Affiliate.
(b) The foregoing provisions shall not apply to (i) any Restricted
Payment that is made in compliance with Section 4.03, (ii) payments by the
Company or any of the Restricted Subsidiaries to Renco of the amounts set forth
in clauses (4), (5) and (6) of the second paragraph Section 4.03, (iii)
repayment of Indebtedness, including accrued interest thereon, owing to Renco as
of the Issue Date with the net proceeds of the issuance of Securities on the
Issue Date, (iv) repayment of Indebtedness owing to Renco incurred after the
Issue Date in accordance with its terms and (v) reasonable and customary regular
fees to directors of the Company and the
55
Restricted Subsidiaries who are not employees of the Company and the Restricted
Subsidiaries.
SECTION 4.12. Limitation on Indebtedness
(a) The Company will not, and will not cause or permit any of the
Restricted Subsidiaries to, directly or indirectly, create, incur, assume,
guarantee, become liable, contingently or otherwise, with respect to, or
otherwise become responsible for the payment of (collectively "incur") any
Indebtedness (including Acquired Indebtedness) other than Permitted
Indebtedness; provided that the Company and the Guarantors may incur
Indebtedness (including Acquired Indebtedness) if: (A) no Default or Event of
Default shall have occurred and be continuing at the time of the proposed
incurrence thereof or shall occur as a result of such proposed incurrence, and
(B) after giving pro forma effect to such proposed incurrence (and the
application of the net proceeds therefrom), the Consolidated Fixed Charge
Coverage Ratio of the Company is at least equal to 2.0 to 1.0. Notwithstanding
the foregoing, a Restricted Subsidiary that is not a Guarantor may incur
Acquired Indebtedness to the extent such Indebtedness could have been incurred
by the Company and the Guarantors pursuant to the proviso in the immediately
preceding sentence.
(b) The Company and the Guarantors shall not, directly or indirectly,
in any event incur any Indebtedness which by its terms (or by the terms of any
agreement governing such Indebtedness) is subordinated to any other Indebtedness
of the Company or such Guarantor unless such Indebtedness is also by its terms
(or by the terms of any agreement governing such Indebtedness) made expressly
subordinated to the Securities or the Guarantee of such Guarantor, as the case
may be, to the same extent and in the same manner as such Indebtedness is
subordinated to such other Indebtedness of the Company or such Guarantor.
SECTION 4.13. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries.
The Company will not, and will not permit any of the Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to: (a) pay dividends or make any other distributions on
its Capital Stock, or any other interest or participation in, or measured by,
its profits, owned by the Company or by any Restricted Subsidiary, or pay any
Indebtedness owed to the Company or any
56
Restricted Subsidiary; (b) make loans or advances to the Company or any
Restricted Subsidiary; or (c) transfer any of its properties or assets to the
Company or to any Restricted Subsidiary, except for such encumbrances or
restrictions existing under or by reason of: (i) applicable law; (ii) this
Indenture; (iii) customary non-assignment provisions of any lease governing a
leasehold interest of the Company or any Restricted Subsidiary; (iv) any
instrument governing Indebtedness of a person acquired by the Company or any
Restricted Subsidiary at the time of such acquisition, which encumbrance or
restriction is not applicable to any person, or the properties or assets of any
person, other than the person or its Subsidiaries so acquired; (v) any written
agreement existing on the Issue Date or amendments or modifications thereto;
provided that no such agreement shall be modified or amended in such a manner as
to make the encumbrance or restriction more restrictive than as in effect on the
Issue Date; (vi) Indebtedness existing and as in effect on the Issue Date,
including, without limitation, the New Senior Credit Facility or any
refinancing, refunding, replacement or extensions thereof, provided that any
such encumbrance or restriction contained in any refinancing, refunding,
replacement or extension of the New Senior Credit Facility shall be no more
restrictive than such encumbrance or restriction contained in the New Senior
Credit Facility as in effect on the Issue Date; and (vii) Indebtedness incurred
in accordance with this Indenture; provided that such encumbrance or restriction
shall be no more restrictive than any encumbrance or restriction contained in
the New Senior Credit Facility as in effect on the Issue Date.
SECTION 4.14. Limitation on Liens.
The Company will not, and will not permit any of the Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Liens upon any properties or assets of the Company (including, without
limitation, any Capital Stock of a Restricted Subsidiary) or any of the
Restricted Subsidiaries whether owned on the Issue Date or acquired after the
Issue Date, or on any income or profits therefrom, or assign or otherwise convey
any right to receive income or profits thereon other than (i) Liens existing on
the Issue Date to the extent and in the manner such Liens are in effect on the
Issue Date, (ii) Liens on properties and assets of the Company and the
Restricted Subsidiaries existing from time to time
57
securing Indebtedness of the Company and the Restricted Subsidiaries under the
New Senior Credit Facility and securing obligations of the Company and the
Restricted Subsidiaries from time to time under performance bonds, surety bonds
or appeal bonds or other obligations of a like nature incurred in the ordinary
course of business and (iii) Permitted Liens.
SECTION 4.15. Change of Control.
(a) Upon the occurrence of a Change of Control, the Company shall be
obligated to make an offer to purchase all outstanding Securities pursuant to
the offer described in paragraph (b), below (the "Change of Control Offer"), at
a purchase price equal to 101% of the principal amount thereof plus accrued
interest, if any, to the date of purchase. Within 10 days after the date upon
which the Change of Control occurred (the "Change of Control Date") requiring
the Company to make a Change of Control Offer pursuant to this Section 4.15, the
Company shall so notify the Trustee.
(b) The notice to the Holders shall contain all instructions and
materials necessary to enable such Holders to tender Securities pursuant to the
Change of Control Offer. Within 30 days following any Change of Control Date,
the Company shall send, by first class mail, a notice to each Holder, with
copies to the Trustee, which notice shall govern the terms of the Change of
Control Offer. Such notice shall state:
(1) that the Change of Control Offer is being made pursuant to this
Section 4.15 and that all Securities tendered will be accepted for payment;
(2) the purchase price (including the amount of accrued interest) and
the purchase date (which shall be no earlier than 45 days nor later than 60
days following the Change of Control Date, other than as may be required by
law) (the "Change of Control Payment Date");
(3) that any Security not tendered will continue to accrue interest;
(4) that, unless the Company defaults in making payment therefor, any
Security accepted for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have a Security purchased pursuant to a
Change of Control Offer will be required to surrender the Security, with the
form entitled "Option of Holder to Elect Purchase" on the last page of the
Security completed, to the Paying Agent at the address
58
specified in the notice prior to the close of business on the Business Day
prior to the Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than two Business Days prior to the Change
of Control Payment Date, a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount of the Securities
the Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Security purchased;
(7) that Holders whose Securities are purchased only in part will be
issued new Securities in a principal amount equal to the unpurchased portion
of the Securities surrendered; and
(8) the circumstances and relevant facts regarding such Change of
Control.
On or before the Change of Control Payment Date, the Company shall (i)
accept for payment Securities or portions thereof tendered pursuant to the
Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal Tender
sufficient to pay the purchase price of all Securities so tendered and (iii)
deliver to the Trustee Securities so accepted together with an Officers'
Certificate stating the Securities or portions thereof being purchased by the
Company. The Paying Agent shall promptly mail to the Holders of Securities so
accepted payment in an amount equal to the purchase price, and the Trustee shall
promptly authenticate and mail to such Holders new Securities equal in principal
amount to any unpurchased portion of the Securities surrendered. Any Securities
not so accepted shall be promptly mailed by the Company to the Holder thereof.
The Company will publicly announce the results of the Change of Control Offer on
or as soon as practicable after the Change of Control Payment Date. The Company
shall comply, to the extent applicable, with the requirements of Section 14(e)
of the Exchange Act and any other securities laws or regulations in connection
with the repurchase of securities pursuant to a Change of Control Offer. The
Change of Control Offer shall remain open for at least 20 Business Days and
until the close of business on the Change of Control Payment Date. For purposes
of this Section 4.15, the Trustee shall act as the Paying Agent.
59
SECTION 4.16. Limitation on Sale of Assets.
The Company will not, and will not permit any of the Restricted
Subsidiaries to, consummate any Asset Sale unless (i) such Asset Sale is for at
least Fair Market Value, (ii) at least 80% of the consideration therefrom
received by the Company or such Restricted Subsidiary is in the form of cash or
Cash Equivalents and (iii) the Company or such Restricted Subsidiary shall apply
the Net Cash Proceeds of such Asset Sale within 270 days of receipt thereof, as
follows:
(a) first, to repay (and, in the case of any revolving credit facility,
to the extent required by such revolving credit facility, effect a permanent
reduction in the commitment thereunder) any Indebtedness secured by the assets
involved in such Asset Sale or otherwise required to be repaid with the proceeds
thereof; and
(b) second, with respect to any Net Cash Proceeds remaining after
application pursuant to the preceding paragraph (a) (the "Available Amount"),
the Company shall make an offer to purchase (the "Asset Sale Offer") from all
Holders of Securities, up to a maximum principal amount (expressed as a multiple
of $1,000) of Securities equal to the Available Amount at a purchase price equal
to 100% of the principal amount thereof plus accrued and unpaid interest
thereon, if any, to the date of purchase; provided, however, that the Company
will not be required to apply pursuant to this paragraph (b) Net Cash Proceeds
received from any Asset Sale if, and only to the extent that, such Net Cash
Proceeds are applied to a Related Business Investment within 270 days of such
Asset Sale; provided, further, that if at any time any non-cash consideration
received by the Company or any Restricted Subsidiary, as the case may be, in
connection with any Asset Sale is converted into or sold or otherwise disposed
of for cash, then such conversion or disposition shall be deemed to constitute
an Asset Sale under and the Net Cash Proceeds thereof shall be applied in
accordance with this Section 4.16; and provided, further, that the Company may
defer the Asset Sale Offer until there is an aggregate unutilized Available
Amount equal to or in excess of $10.0 million resulting from one or more Asset
Sales (at which time, the entire unutilized Available Amount, and not just the
amount in excess of $10.0 million, shall be applied as required pursuant to this
paragraph). To the extent the Asset Sale Offer is not fully subscribed to by
Holders of the Securities, the Company and the Restricted Subsidiaries
60
may retain such unutilized portion of the Available Amount and use it for any
purpose not prohibited by this Indenture. Pending application of the Net Cash
Proceeds of an Asset Sale in compliance with this Section 4.16, the Company may
temporarily reduce amounts outstanding under any revolving credit facility,
including the New Senior Credit Facility.
In the event of the transfer of substantially all (but not all) of the
property and assets of the Company and the Restricted Subsidiaries as an
entirety to a person in a transaction permitted under Article V the successor
corporation shall be deemed to have sold the properties and assets of the
Company and the Restricted Subsidiaries not so transferred for purposes of this
covenant, and shall comply with the provisions of this covenant with respect to
such deemed sale as if it were an Asset Sale. In addition, the Fair Market Value
of such properties and assets of the Company or the Restricted Subsidiaries
deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this
covenant.
The notice of an Asset Sale Offer shall be sent, by first class mail,
by the Company (or caused to be mailed by the Company) with a copy to the
Trustee to all Holders of Securities not less than 30 days nor more than 60 days
before the Asset Sale Payment Date at their last registered addresses. The Asset
Sale Offer shall remain open from the time of mailing until three days before
the Asset Sale Offer Payment Date. The notice to the Holders shall contain all
instructions and materials necessary to enable such Holders to tender Securities
pursuant to the Asset Sale Offer. Such notice shall state:
(1) that the Asset Sale Offer is being made pursuant to Section 4.16;
(2) the purchase price (including an amount of accrued interest) and
the Asset Sale Offer Payment Date;
(3) that any Security not tendered will continue to accrue interest;
(4) that unless the Company defaults in making payment therefor, any
Security accepted for payment pursuant to the Asset Sale Offer shall cease
to accrue interest after the Asset Sale Offer Payment Date;
(5) that Holders electing to have a Security purchased pursuant to an
Asset Sale Offer will be required to
61
surrender the Security, with the form entitled "Option of Holder to Elect
Purchase" on the last page of the Security completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the
Business Day prior to the Asset Sale Offer Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, no later than two Business Days prior to the Asset
Sale Offer Payment Date, a telegram, telex, facsimile transmission or letter
stating fully the name of the Holder, the principal amount of the Securities
the Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have such Security purchased;
(7) that if Securities in a principal amount in excess of the principal
amount of the Securities to be acquired pursuant to the Asset Sale Offer are
tendered and not withdrawn pursuant to the Asset Sale Offer, the Company
shall purchase Securities on a pro rata basis (with such adjustment as may
be deemed appropriate by the Company so that only Securities in
denominations of $1,000 or integral multiples of $1,000 shall be so
acquired); and
(8) that Holders whose Securities are purchased only in part will be
issued new Securities in a principal amount equal to the unpurchased portion
of the Securities surrendered.
On or before an Asset Sale Offer Payment Date, the Company shall (i)
accept for payment Securities or portions thereof tendered pursuant to the Asset
Sale Offer (on a pro rata basis if required pursuant to paragraph (7) above),
(ii) deposit with the Paying Agent U.S. Legal Tender sufficient to pay the
purchase price of all Securities or portions thereof so tendered and (iii)
deliver to the Trustee Securities so accepted together with an Officers'
Certificate identifying the Securities or portions thereof accepted for payment
by the Company. The Paying Agent shall promptly mail or deliver to Holders of
Securities so accepted payment in an amount equal to the purchase price, and the
Trustee shall promptly authenticate and mail or deliver to such Holders new
Securities equal in principal amount to any unpurchased portion of the
Securities surrendered. Any Securities not so accepted shall be promptly mailed
or delivered by the Company to the Holder thereof. The Company will publicly
announce the results of the Asset Sale Offer as promptly as practicable
following the Asset Sale Offer Payment Date. The Company shall comply, to the
extent applicable, with
62
the requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities pursuant to
an Asset Sale Offer.
SECTION 4.17. Limitation on Preferred Stock of Restricted Subsidiaries.
The Company will not permit any Restricted Subsidiary to issue any
Preferred Stock (except to the Company or a Restricted Subsidiary), nor will the
Company permit any person (other than the Company or a Restricted Subsidiary) to
hold any Preferred Stock of a Restricted Subsidiary.
SECTION 4.18. Future Guarantees.
If the Company or any of the Restricted Subsidiaries transfers or
causes to be transferred, in one transaction or a series of related
transactions, any property to any domestic Restricted Subsidiary that is not a
Guarantor, or if the Company or any of the Restricted Subsidiaries shall
organize, acquire or otherwise invest in another Restricted Subsidiary, in each
case having total assets with a book value in excess of $1.0 million, then such
transferee or acquired or other Restricted Subsidiary shall (i) execute and
deliver to the Trustee a supplemental indenture in form reasonably satisfactory
to the Trustee pursuant to which such Restricted Subsidiary shall
unconditionally guarantee all of the Company's obligations under the Securities
and this Indenture on the terms set forth in this Indenture and (ii) deliver to
the Trustee an Opinion of Counsel that such supplemental indenture has been duly
authorized, executed and delivered by such Restricted Subsidiary and constitutes
a legal, valid, binding and enforceable obligation of such Restricted
Subsidiary. Thereafter, such Restricted Subsidiary shall be a Guarantor for all
purposes of this Indenture.
SECTION 4.19. Conduct of Business.
The Company and the Restricted Subsidiaries will not engage in any
businesses which are not the same, similar or reasonably related to the
businesses in which the Company and the Restricted Subsidiaries are engaged on
the Issue Date.
63
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. When Company May Merge, Etc.
(a) The Company will not, in a single transaction or series of related
transactions, (i) consolidate or merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of its assets to
any person or (ii) adopt a Plan of Liquidation unless:
(1) either (a) the Company shall be the surviving or continuing
corporation, or (b) the person (if other than the Company) formed by such
consolidation or the person into which the Company is merged or the person
which acquires by sale, assignment, transfer, lease, conveyance or otherwise
all or substantially all of the assets of the Company or in the case of a
Plan of Liquidation, the person to which the assets of the Company have been
transferred (i) shall be a corporation organized and validly existing under
the laws of the United States or any State thereof or the District of
Columbia and (ii) shall expressly assume, by supplemental indenture (in form
and substance satisfactory to the Trustee) executed and delivered to the
Trustee, the due and punctual payment of the principal of, and premium, if
any, and interest on, all of the Securities, and the performance of every
covenant of this Indenture, the Securities and the Registration Rights
Agreement on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and the
assumption contemplated by clause (1)(b)(ii) above (including giving effect
to any Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred in connection with or in respect of such transaction), the Company
(in the case of clause (a) of the foregoing clause (1)) or such person (in
the case of clause (1)(b) thereof) shall be able to incur (assuming a market
rate of interest with respect thereto) at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) as if it were the Company
under paragraph (a) of Section 4.12 of this Indenture;
(3) immediately before and after giving effect to such transaction and
the assumption contemplated by clause
64
(1)(b)(ii) above (including giving effect to any Indebtedness and Acquired
Indebtedness incurred or anticipated to be incurred in connection with or in
respect of the transaction), no Default or Event of Default shall have
occurred and be continuing;
(4) the Company or such person shall have delivered to the Trustee (A)
an Officers' Certificate and an Opinion of Counsel (which counsel shall not
be in-house counsel of the Company), each stating that such consolidation,
merger, conveyance, transfer, lease or Plan of Liquidation and if a
supplemental indenture is required in connection with such transaction, such
supplemental indenture comply with this provision of this Indenture and that
all conditions precedent in this Indenture relating to such transaction have
been satisfied and (B) a certificate from the Company's independent
certified public accountants stating that the Company has made the
calculations required by clause (2) above in accordance with the terms of
this Indenture; and
(5) neither the Company nor any Restricted Subsidiary nor such person,
as the case may be, would thereupon become obligated with respect to any
Indebtedness (including Acquired Indebtedness) nor any of its property or
assets subject to any Lien, unless the Company or such Restricted Subsidiary
or such person, as the case may be, could incur such Indebtedness (including
Acquired Indebtedness) or create such Lien under this Indenture (giving
effect to such person being bound by all the terms of this Indenture).
(b) For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Restricted
Subsidiaries, the Capital Stock of which constitutes all or substantially all of
the properties and assets of the Company, shall be deemed to be the transfer of
all or substantially all of the properties and assets of the Company.
(c) Each Guarantor (other than any Guarantor whose Guarantee is to be
released in accordance with the terms of the Guarantee and this Indenture in
connection with any transaction complying with the provisions of Section 4.16)
will not, and the Company will not cause or permit any Guarantor to, consolidate
with or merge with or into or sell, assign, transfer, lease, convey or otherwise
dispose of all or substantially all
65
of its assets to any person (other than a merger of the Company with any
Guarantor or a merger of Guarantors) unless (i) the entity formed by or
surviving any such consolidation or merger (if other than the Guarantor) or to
which such sale, lease, conveyance or other disposition shall have been made is
a corporation organized and validly existing under the laws of the United States
or any state thereof or the District of Columbia or an entity organized and
validly existing under the laws of the foreign jurisdiction in which such
Guarantor is organized; (ii) such entity assumes by supplemental indenture all
of the obligations of such Guarantor under such Guarantee; and (iii) immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing.
(d) Notwithstanding the foregoing, (i) the merger of the Company with
an Affiliate incorporated solely for the purpose of incorporating the Company in
another jurisdiction shall be permitted and (ii) the merger of the Company and
any Restricted Subsidiary shall be permitted.
SECTION 5.02. Successor Corporation Substituted.
Upon any consolidation, merger, conveyance, lease or transfer in
accordance with Section 5.01, the successor person formed by such consolidation
or into which the Company or any Guarantor, as the case may be, is merged or to
which such conveyance, lease or transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company or such
Guarantor, as the case may be, under this Indenture with the same effect as if
such successor person had been named as the Company or such Guarantor, as the
case may be, herein and thereafter (except in the case of a sale, assignment,
transfer, lease, conveyance or other disposition) the predecessor corporation
will be relieved of all further obligations and covenants under this Indenture
and the Securities, in the case of the Company, or its Guarantee, in the case of
any Guarantor.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs if:
66
(1) the Company defaults in the payment of interest on any Securities
when the same becomes due and payable and the Default continues for a period
of 30 days;
(2) the Company defaults in the payment of the stated principal amount
of any Securities when the same becomes due and payable at maturity, upon
acceleration or redemption pursuant to an offer to purchase required
hereunder or otherwise;
(3) the Company or any of the Guarantors fails to comply in all
material respects with any of their other agreements contained in the
Securities or this Indenture (including, without limitation, under Sections
4.15, 4.16 and 5.01) and the Default continues for the period and after the
notice specified below;
(4) there shall be any default or defaults in the payment of principal
or interest under one or more agreements, instruments, mortgages, bonds,
debentures or other evidences of Indebtedness under which the Company or any
Restricted Subsidiary then has outstanding Indebtedness in excess of $7.5
million, individually or in the aggregate;
(5) there shall be any default or defaults under one or more
agreements, instruments, mortgages, bonds, debentures or other evidences of
Indebtedness under which the Company or any Restricted Subsidiary then has
outstanding Indebtedness in excess of $7.5 million, individually or in the
aggregate, and such default or defaults have resulted in the acceleration of
the maturity of such Indebtedness;
(6) the Company or any Restricted Subsidiary fails to perform (after
giving effect to any applicable grace periods) any term, covenant, condition
or provision of one or more agreements, instruments, mortgages, bonds,
debentures or other evidences of Indebtedness under which the Company or any
Restricted Subsidiary then has outstanding Indebtedness in excess of $7.5
million, individually or in the aggregate, and such failure to perform
results in the commencement of judicial proceedings to foreclose upon any
assets of the Company or any such Restricted Subsidiary securing such
Indebtedness or the holders of such Indebtedness shall have exercised any
right under applicable law or applicable security documents to take
ownership of any such assets in lieu of foreclosure;
67
(7) one or more judgments, orders or decrees for the payment of money
which either individually or in the aggregate at any one time exceed $7.5
million shall be rendered against the Company or any Restricted Subsidiary
by a court of competent jurisdiction and shall remain undischarged and
unbonded for a period (during which execution shall not be effectively
stayed) of 60 consecutive days after such judgment becomes final and
nonappealable;
(8) the Company or any Significant Subsidiary (a) admits in writing its
inability to pay its debts generally as they become due, (b) commences a
voluntary case or proceeding under any Bankruptcy Law with respect to
itself, (c) consents to the entry of a judgment, decree or order for relief
against it in an involuntary case or proceeding under any Bankruptcy Law,
(d) consents to the appointment of a Custodian of it or for substantially
all of its property, (e) consents to or acquiesces in the institution of a
bankruptcy or an insolvency proceeding against it, (f) makes a general
assignment for the benefit of its creditors or (g) takes any corporate
action to authorize or effect any of the foregoing;
(9) a court of competent jurisdiction enters a judgment, decree or
order for relief in respect of the Company or any Significant Subsidiary in
an involuntary case or proceeding under any Bankruptcy Law which shall (1)
approve as properly filed a petition seeking reorganization, arrangement,
adjustment or composition in respect of the Company or any Significant
Subsidiary, (2) appoint a Custodian of the Company or any Significant
Subsidiary or for substantially all of its property or (3) order the
winding-up or liquidation of its affairs, and such judgment, decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or
(10) any of the Guarantees of any Significant Subsidiary ceases to be
in full force and effect or any of such Guarantees is declared to be null
and void and unenforceable or any of such Guarantees is found to be invalid,
or any such Guarantor denies its liability under its Guarantee (other than
by reason of release of a Guarantor in accordance with the terms of this
Indenture).
A Default under clause (3) above (other than in the case of any Default
under Sections 4.15, 4.16 and 5.01, which Defaults shall be Events of Default
without the notice and without the passage of time specified in this paragraph)
is not
68
an Event of Default until the Trustee notifies the Company, or the Holders of at
least 25% in principal amount of the outstanding Securities notify the Company
and the Trustee, of the Default, and the Company does not cure the Default
within 30 days after receipt of the notice. The notice must specify the Default,
demand that it be remedied and state that the notice is a "Notice of Default."
Such notice shall be given by the Trustee if so requested by the Holders of at
least 25% in principal amount of the Securities then outstanding.
SECTION 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in
Section 6.01(8) or 6.01(9)) occurs and is continuing, then and in every such
case the Trustee may, by notice to the Company, or the Holders of at least 25%
in aggregate principal amount of the Securities then outstanding may, by written
notice to the Company and the Trustee, and the Trustee shall, upon the request
of such Holders, declare the aggregate unpaid principal of and premium, if any,
on all of the Securities outstanding, together with accrued but unpaid interest
thereon to the date of payment, to be due and payable and, upon any such
declaration, the same shall become and be due and payable; provided, however,
that the Trustee shall be under no obligation to follow any request of any of
the Holders unless such Holders shall have offered to the Trustee, after request
by the Trustee, reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred by it in compliance with such request, order
or direction. If an Event of Default specified in Section 6.01(8) or 6.01(9)
occurs, all unpaid principal, premium, if any, and accrued interest on the
Securities then outstanding shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Securityholder. Upon payment of such principal amount and interest, all of the
Company's obligations under the Securities and this Indenture, other than
obligations under Section 7.07, shall terminate. The Holders of a majority in
principal amount of the Securities then outstanding by notice to the Trustee may
rescind an acceleration and its consequences if (i) all existing Events of
Default, other than the non-payment of the principal and interest on the
Securities which have become due solely by such declaration of acceleration,
have been cured or waived, (ii) to the extent the payment of such interest is
lawful, interest on overdue installments of interest and overdue principal,
which has become due otherwise than by such declaration of acceleration, has
been paid, and (iii) the rescission would not conflict with any judgment or
decree of a court of competent jurisdiction. No
69
such rescission shall affect any subsequent default or impair any right
consequent thereto. In the event that a declaration of acceleration under either
Section 6.01(4) or 6.01(5) above has occurred and is continuing, such
declaration of acceleration shall be automatically annulled if the Indebtedness
that is the subject of such Event of Default has been discharged or paid or the
holders of such Indebtedness shall have rescinded their declaration of
acceleration in respect of such Indebtedness within 60 days thereafter and no
other Event of Default has occurred during such 60-day period which has not been
cured or waived.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 6.07 and 9.02, the Holders of a majority in
principal amount of the outstanding Securities by notice to the Trustee may
waive an existing Default or Event of Default and its consequences, except a
Default in the payment of principal of, premium, if any, or interest on any
Security as specified in clauses (1) and (2) of Section 6.01 or in respect of
any provision hereof which cannot be modified or amended without the consent of
the Holder so affected pursuant to Section 9.02. When a Default or Event of
Default is so waived, it shall be deemed cured and cease to exist.
SECTION 6.05. Control by Majority.
The Holders of a majority in principal amount of the outstanding
Securities may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it including,
70
without limitation, any remedies provided for in Section 6.03. Subject to
Section 7.01, however, the Trustee may refuse to follow any direction that
conflicts with any law or this Indenture, that the Trustee determines may be
unduly prejudicial to the rights of another Securityholder, or that may involve
the Trustee in personal liability; provided that the Trustee may take any other
action deemed proper by the Trustee which is not inconsistent with such
direction.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(1) the Holder gives to the Trustee notice of a continuing Event of
Default;
(2) Holders of at least 25% in principal amount of the outstanding
Securities make a written request to the Trustee to pursue the remedy;
(3) such Holders offer to the Trustee reasonable indemnity against any
loss, liability or expense to be incurred in compliance with such request;
(4) the Trustee does not comply with the request within 30 days after
receipt of the request and the offer of satisfactory indemnity; and
(5) during such 30-day period the Holders of a majority in principal
amount of the outstanding Securities do not give the Trustee a direction
which, in the opinion of the Trustee, is inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of principal of and interest on a Security, on or
after the respective due dates expressed in such Security, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of such Holder.
71
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or interest specified in
clause (1) or (2) of Section 6.01 occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company, the Guarantors or any other obligor on the Securities for the whole
amount of principal and accrued interest remaining unpaid, together with
interest on overdue principal and, to the extent that payment of such interest
is lawful, interest on overdue installments of interest, in each case at the
rate per annum borne by the Securities and such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, taxes,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relating to the Company, the
Guarantors or any other obligor upon the Securities, any of their respective
creditors or any of their respective property and shall be entitled and
empowered to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same, and any Custodian in
any such judicial proceedings is hereby authorized by each Securityholder to
make such payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Securityholders, to pay
to the Trustee any amount due to it for the reasonable compensation, expenses,
taxes, disbursements and advances of the Trustee, its agent and counsel, and any
other amounts due the Trustee under Section 7.07. Nothing herein contained shall
be deemed to authorize the Trustee to authorize or consent to or accept or adopt
on behalf of any Securityholder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money pursuant to this Article Six, it
shall pay out the money in the following order:
72
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for interest accrued on the Securities, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Securities for interest;
Third: to Holders for principal amounts owing under the Securities and
other amounts owing to the Holders with respect to the Securities, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Securities for principal and other amounts owing to the
Holders with respect to the Securities; and
Fourth: to the Company or any other obligor on the Securities, as their
interests may appear, or as a court of competent jurisdiction may direct.
The Trustee, upon prior notice to the Company, may fix a record date
and payment date for any payment to Securityholders pursuant to this Section
6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.07, or a suit by a Holder or Holders of more than 10% in
principal amount of the outstanding Securities.
ARTICLE SEVEN
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
73
SECTION 7.01. Duties of Trustee.
(a) If a Default or an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in its exercise thereof as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of a Default or an Event of Default:
(1) The Trustee need perform only those duties as are specifically set
forth in this Indenture and no covenants or obligations shall be implied in
this Indenture that are adverse to the Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
the Trustee shall examine the certificates and opinions to determine whether
or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by it
pursuant to Sections 6.02 or 6.05.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment
74
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money or assets
received by it except as the Trustee may agree with the Company. Assets held in
trust by the Trustee need not be segregated from other assets except to the
extent required by law.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely and shall be fully protected in acting or
refraining from acting upon any document believed by it to be genuine and to
have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate or an Opinion of Counsel,
which shall conform to Sections 10.04 and 10.05. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
certificate or opinion.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, notice, request, direction, consent, order, bond, debenture, or other
paper or document, but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit, and, if
the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled, upon reasonable
75
notice to the Company, to examine the books, records, and premises of the
Company, personally or by agent or attorney.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred by
it in compliance with such request, order or direction.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company, any
Subsidiary of the Company or their respective Affiliates with the same rights it
would have if it were not Trustee. Any Agent may do the same with like rights.
However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement in the Securities other than the Trustee's certificate of
authentication.
SECTION 7.05. Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to each Securityholder, as their
names and addresses appear on the Securityholder list described in Section 2.05,
notice of the uncured Default or Event of Default within 90 days after the
Trustee obtains actual knowledge that such Default or Event of Default has
occurred. Except in the case of a Default or an Event of Default in payment of
principal of, or interest on, any Security, and a Default that resulted from the
failure to comply with Sections 4.15, 4.16 or 5.01, the Trustee may withhold the
notice if and so long as its board of directors, the executive committee of its
board of directors or a committee of its directors and/or Trust Officers in good
faith determines that withholding the notice is in the interest of the
Securityholders.
76
SECTION 7.06. Reports by Trustee to Holders.
This Section 7.06 shall not be operative as a part of this Indenture
until this Indenture is qualified under the TIA, and, until such qualification,
this Indenture shall be construed as if this Section 7.06 were not contained
herein.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, the Trustee shall, to the extent that any of the
events described in TIA Section 313(a) occurred within the previous twelve
months, but not otherwise, mail to each Securityholder a brief report dated as
of such May 15 that complies with TIA Section 313(a). The Trustee also shall
comply with TIA Sections 313(b) and 313(c).
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Company and filed with the SEC and each stock exchange,
if any, on which the Securities are listed.
The Company shall notify the Trustee if the Securities become listed on
any securities exchange.
SECTION 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for its services as the Company and the Trustee may agree. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all tax obligations imposed on the Trustee related to this Indenture
and all reasonable out-of-pocket expenses incurred or made by it. Such expenses
shall include the reasonable fees and expenses of the Trustee's agents and
counsel.
The Company shall indemnify the Trustee and its agents for, and hold
them harmless against, any loss, liability or expense incurred by them except
for such actions to the extent caused by any negligence or bad faith on their
part, arising out of or in connection with the administration of this trust
including the reasonable costs and expenses of defending themselves against any
claim or liability in connection with the exercise or performance of any of
their rights, powers or duties hereunder. The Trustee shall notify the Company
promptly of any claim asserted against the Trustee for which it may seek
indemnity, but the Trustee's failure to so notify the Company shall not affect
the Company's obligations hereunder. The Company shall defend the claim and the
Trustee shall cooperate
77
in the defense. The Trustee may have separate counsel and the Company shall pay
the reasonable fees and expenses of such counsel; provided that the Company will
not be required to pay such fees and expenses if it assumes the Trustee's
defense and there is no conflict of interest between the Company and the Trustee
in connection with such defense as reasonably determined by the Trustee. The
Company need not pay for any settlement made without its written consent. The
Company need not reimburse any expense or indemnify against any loss or
liability to the extent incurred by the Trustee through its negligence, bad
faith or willful misconduct.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Securities on all assets or money held or
collected by the Trustee, in its capacity as Trustee, except assets or money
held in trust to pay principal of or interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(8) or (9) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company. The Holders of a
majority in principal amount of the outstanding Securities may remove the
Trustee by so notifying the Company and the Trustee and may appoint a successor
trustee with the Company's consent. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Securities may appoint a successor Trustee to replace the successor Trustee
appointed by the Company.
78
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 7.07, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the outstanding Securities may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA Sections 310(a)(1) and 310(a)(5). The Trustee (or in the case
of a corporation included in a bank holding company system, the related bank
holding company) shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition. In addition, if the Trustee is a corporation included in a bank
holding company system, the Trustee, independently of such bank holding company,
shall meet the capital requirements of TIA Section 310(a)(2). The Trustee shall
comply with TIA
79
Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities, or certificates of interest or participation in other securities, of
the Company or the Guarantors are outstanding, if the requirements for such
exclusion set forth in TIA Section 310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE EIGHT
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Termination of Company's Obligations.
The Company and the Guarantors may terminate their obligations under
the Securities and the Guarantees and this Indenture, except those obligations
referred to in the penultimate paragraph of this Section 8.01, if all Securities
previously authenticated and delivered (other than destroyed, lost or stolen
Securities which have been replaced or paid and Securities for whose payment
money has heretofore been deposited in trust or segregated and held in trust by
the Company and thereafter repaid to the Company or discharged from such trust)
have been delivered to the Trustee for cancellation and the Company has paid all
sums payable by it hereunder, or if:
(a) pursuant to Article Three, the Company shall have given notice to
the Trustee and mailed a notice of redemption to each Holder of the redemption
of all of the Securities under arrangements satisfactory to the Trustee for the
giving of such notice;
(b) the Company shall have irrevocably deposited or caused to be
deposited with the Trustee or a trustee satisfactory to the Trustee, under the
terms of an irrevocable trust agreement in form and substance satisfactory to
the Trustee, as trust funds in trust solely for the benefit of the Holders for
that purpose, money or direct non-callable obligations of, or non-callable
obligations
80
guaranteed by, the United States of America for the payment of which guarantee
or obligation the full faith and credit of the United States is pledged ("U.S.
Government Obligations") maturing as to principal and interest in such amounts
and at such times as are sufficient without consideration of any reinvestment of
such interest, to pay principal of, premium, if any, and interest on such
outstanding Securities to redemption as certified to the Trustee by a nationally
recognized firm of independent public accountants designated by the Company;
provided that the Trustee shall have been irrevocably instructed to apply such
money or the proceeds of such U.S. Government Obligations to the payment of said
principal, premium, if any, and interest with respect to the Securities; and
(c) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent providing for the termination of the Company's obligation under the
Securities, the Guarantees and this Indenture have been complied with.
Notwithstanding the foregoing paragraph, the Company's obligations in
Sections 2.05, 2.06, 2.07, 2.08, 4.01, 4.02, 7.07, 7.08, 8.04 and 8.05 shall
survive until the Securities are no longer outstanding. After the Securities are
no longer outstanding, the Company's obligations in Sections 7.07, 8.04 and 8.05
shall survive.
After such delivery or irrevocable deposit the Trustee upon request
shall acknowledge in writing the discharge of the Company's obligations under
the Securities, the Guarantees and this Indenture except for those surviving
obligations specified above.
SECTION 8.02. Legal Defeasance and Covenant Defeasance.
(a) The Company may, at its option by Board Resolution, at any time,
with respect to the Securities, elect to have either paragraph (b) or paragraph
(c) below be applied to the outstanding Securities upon compliance with the
conditions set forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (b), the Company shall be deemed to have been
released and discharged from its obligations with respect to the outstanding
Securities and the Guarantees on the date the conditions set forth below are
81
satisfied (hereinafter, "legal defeasance"). For this purpose, such legal
defeasance means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by the outstanding Securities, which shall
thereafter be deemed to be "outstanding" only for the purposes of paragraph (e)
below and the other Sections of and matters under this Indenture referred to in
(i) and (ii) below, and to have satisfied all its other obligations under such
Securities and Guarantees and this Indenture insofar as such Securities and
Guarantees are concerned (and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging the same), except for the following
which shall survive until otherwise terminated or discharged hereunder: (i) the
rights of Holders of outstanding Securities to receive solely from the trust
fund described in paragraph (d) below and as more fully set forth in such
paragraph, payments in respect of the principal of and interest on such
Securities and Guarantees when such payments are due, (ii) the Company's
obligations with respect to such Securities and Guarantees under Sections 2.05,
2.06, 2.07, 2.08, 4.02, 7.07, 7.08, 8.04 and 8.05, (iii) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and (iv) this Section
8.02. Subject to compliance with this Section 8.02, the Company may exercise its
option under this paragraph (b) notwithstanding the prior exercise of its option
under paragraph (c) below with respect to the Securities.
(c) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (c), the Company shall be released and discharged
from its obligations under any covenant contained in Article Five and in
Sections 4.03, 4.07, 4.09 and 4.11 through 4.19 with respect to the outstanding
Securities on and after the date the conditions set forth below are satisfied
(hereinafter, "covenant defeasance"), and the Securities shall thereafter be
deemed to be not "outstanding" for the purpose of any direction, waiver, consent
or declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the outstanding Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an Event
of Default under Section 6.01, but, except as specified
82
above, the remainder of this Indenture and such Securities shall be unaffected
thereby.
(d) The following shall be the conditions to application of either
paragraph (b) or paragraph (c) above to the outstanding Securities:
(i) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of making
the following payments, specifically pledged as security for, and dedicated
solely to, the benefit of the Holders of such Securities, (A) money in an
amount, or (B) U.S. Government Obligations which through the scheduled
payment of principal of and interest in respect thereof in accordance with
their terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, sufficient, in
the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee, to pay and discharge and which shall be applied by the Trustee (or
other qualifying trustee) to pay and discharge principal of, premium, if
any, and interest on the outstanding Securities on the Maturity Date of such
principal or installment of principal or interest in accordance with the
terms of this Indenture and of such Securities; provided, however, that the
Trustee (or other qualifying trustee) shall have received an irrevocable
written order from the Company instructing the Trustee (or other qualifying
trustee) to apply such money or the proceeds of such U.S. Government
Obligations to said payments with respect to the Securities;
(ii) no Default or Event of Default or event which with notice or lapse
of time or both would become a Default or an Event of Default with respect
to the Securities shall have occurred and be continuing on the date of such
deposit or, insofar as Sections 6.01(8) and (9) are concerned, at any time
during the period ending on the 91st day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied until the
expiration of such period);
(iii) such legal defeasance or covenant defeasance shall not result in
a breach or violation of, or constitute a Default or Event of Default under,
this Indenture or any other agreement or instrument to which the Company is
a party or by which it is bound;
83
(iv) in the case of an election under paragraph (b) above, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that (x)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (y) 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 shall confirm that, the
Holders of the outstanding Securities will not recognize income, gain or
loss for Federal income tax purposes as a result of such legal 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 legal
defeasance had not occurred;
(v) in the case of an election under paragraph (c) above, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect that
the Holders of the outstanding Securities will not recognize income, gain or
loss for Federal income tax purposes as a result of such covenant defeasance
and will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such covenant
defeasance had not occurred;
(vi) in the case of an election under either paragraph (b) or (c)
above, an Opinion of Counsel to the effect that, assuming no intervening
bankruptcy of the Company between the date of deposit and the 91st day
following the date of deposit and that no Holder is an insider of the
Company, (x) the trust funds will not be subject to any rights of any other
holders of Indebtedness of the Company, and (y) after the 91st day following
the deposit, the trust funds will not be subject to the effect of any
applicable Bankruptcy Law; provided, however, that if a court were to rule
under any such law in any case or proceeding that the trust funds remained
property of the Company, no opinion needs to be given as to the effect of
such laws on the trust funds except the following: (A) assuming such trust
funds remained in the Trustee's possession prior to such court ruling to the
extent not paid to Holders of Securities, the Trustee will hold, for the
benefit of the Holders of Securities, a valid and enforceable security
interest in such trust funds that is not avoidable in bankruptcy or
otherwise, subject only to principles of equitable subordination, (B) the
Holders of Securities will be entitled to receive adequate protection of
their interests in such trust funds if such trust funds
84
are used, and (C) no property, rights in property or other interests granted
to the Trustee or the Holders of Securities in exchange for or with respect
to any of such funds will be subject to any prior rights of any other
person, subject only to prior Liens granted under Section 364 of Title 11 of
the U.S. Bankruptcy Code (or any section of any other Bankruptcy Law having
the same effect), but still subject to the foregoing clause (B); and
(vii) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that (A) all conditions
precedent provided for relating to either the legal defeasance under
paragraph (b) above or the covenant defeasance under paragraph (c) above, as
the case may be, have been complied with and (B) if any other Indebtedness
of the Company shall then be outstanding, such legal defeasance or covenant
defeasance will not violate the provisions of the agreements or instruments
evidencing such Indebtedness.
Notwithstanding the foregoing, the Opinion of Counsel and a ruling from
the Internal Revenue Service required by clause (iv) above of this Section 8.02
need not be delivered if all Securities not theretofore delivered to the Trustee
for cancellation (i) have become due and payable, (ii) will become due and
payable on the Maturity Date within one year or (iii) are to be called for
redemption within one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the name, and at the
expense, of the Company.
(e) All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee, collectively
for purposes of this paragraph (e), the "Trustee") pursuant to paragraph (d)
above in respect of the outstanding Securities shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(other than the Company or any of its Affiliates) as the Trustee may determine,
to the Holders of such Securities of all sums due and to become due thereon in
respect of principal and interest, but such money need not be segregated from
other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to
85
paragraph (d) above or the principal and interest received in respect thereof
other than any such tax, fee or other charge which by law is for the account of
the Holders of the outstanding Securities.
Anything in this Section 8.02 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request,
in writing, by the Company any money or U.S. Government Obligations held by it
as provided in paragraph (d) above which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
legal defeasance or covenant defeasance.
SECTION 8.03. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Sections 8.01 and 8.02, and shall apply the
deposited money and the money from U.S. Government Obligations in accordance
with this Indenture to the payment of principal of, premium, if any, and
interest on the Securities.
SECTION 8.04. Repayment to Company.
Subject to Sections 7.07, 8.01 and 8.02, the Trustee shall promptly pay
to the Company, upon receipt by the Trustee of an Officers' Certificate, any
excess money, determined in accordance with Sections 8.02(d)(i) and (e), held by
it at any time. The Trustee and the Paying Agent shall pay to the Company upon
receipt by the Trustee or the Paying Agent, as the case may be, of an Officers'
Certificate, any money held by it for the payment of principal or interest that
remains unclaimed for two years; provided, however, that the Trustee and the
Paying Agent before being required to make any payment may, but need not, at the
expense of the Company, cause to be published once in a newspaper of general
circulation in The City of New York or mail to each Holder entitled to such
money notice that such money remains unclaimed and that after a date specified
therein, which shall be at least 30 days from the date of such publication or
mailing, any unclaimed balance of such money then remaining will be repaid to
the Company. After payment to the Company, Securityholders entitled to money
must look solely to the Company for payment as general creditors unless an
applicable abandoned property law designates another person, and
86
all liability of the Trustee or Paying Agent with respect to such money shall
thereupon cease.
SECTION 8.05. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Indenture 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, then
and only then the Company's obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had been made pursuant to
this Indenture until such time as the Trustee is permitted to apply all such
money or U.S. Government Obligations in accordance with this Indenture;
provided, however, that if the Company has made any payment of interest on or
principal of any Securities because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
From time to time, the Company and the Guarantors when authorized by
Board Resolutions, and the Trustee, together, may amend or supplement this
Indenture or the Securities without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency; provided that such
amendment or supplement does not adversely affect the rights of any Holder;
(2) to comply with Article Five;
(3) to provide for uncertificated Securities in addition to or in place
of certificated Securities;
(4) to make any other change that does not materially adversely affect
the rights of any Securityholders hereunder, including, without limitation,
adding Restricted Subsidiaries as additional Guarantors; or
87
(5) to comply with any requirements of the SEC in connection with the
qualification of this Indenture under the TIA;
provided that the Company has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.01.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Company and the Guarantors, when
authorized by Board Resolutions, and the Trustee, together, with the written
consent of the Holder or Holders of at least a majority in aggregate principal
amount of the outstanding Securities, may amend or supplement this Indenture or
the Securities, without notice to any other Securityholders. Subject to Section
6.07, the Holder or Holders of a majority in aggregate principal amount of the
outstanding Securities may waive compliance by the Company with any provision of
this Indenture or the Securities without notice to any other Securityholder.
However, without the consent of each Securityholder, no amendment, supplement or
waiver, including a waiver pursuant to Section 6.04, may:
(1) reduce the principal amount of Securities whose Holders must
consent to an amendment, supplement or waiver of any provision of this
Indenture or the Securities;
(2) reduce the rate of, or extend the time for payment of, interest,
including defaulted interest, on any Security;
(3) reduce the principal amount of any Security or any premium thereon;
(4) change the Maturity Date of any Security, or alter the redemption
provisions or the repurchase provisions in this Indenture or the Securities
in a manner adverse to any Holder other than a redemption or repurchase
under Sections 4.15 or 4.16;
(5) waive a default in the payment of the principal of, interest on, or
redemption payment or repurchase payment required hereunder with respect to,
any Security other than a payment required upon a Change of Control or after
an Asset Sale;
88
(6) make any changes in any provisions relating to waivers of defaults,
the ability of the Holders to enforce their rights under this Indenture, the
Securities or this Section 9.02;
(7) make the principal of, or the interest on any Security payable in
money other than as provided for in this Indenture and the Securities as in
effect on the date hereof;
(8) affect the ranking of the Securities or the Guarantees in a manner
adverse to the Holders; or
(9) release the Guarantee of any Significant Subsidiary.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
SECTION 9.03. Compliance with TIA.
From the date on which this Indenture is qualified under the TIA, every
amendment, waiver or supplement of this Indenture or the Securities shall comply
with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by notice to the Trustee
or the Company received before the date on which the Trustee receives an
Officers' Certificate certifying that the Holders of the requisite principal
amount
89
of Securities have consented (and not theretofore revoked such consent) to the
amendment, supplement or waiver. Notwithstanding the above, nothing in this
paragraph shall impair the right of any Securityholder under ss. 316(b) of the
TIA.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the last
sentence of the immediately preceding paragraph, those persons who were Holders
at such record date (or their duly designated proxies), and only those persons,
shall be entitled to revoke any consent previously given, whether or not such
persons continue to be Holders after such record date. No such consent shall be
valid or effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (9) of Section 9.02, in which case, the amendment, supplement or
waiver shall bind only each Holder of a Security who has consented to it and
every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder's Security.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security (and the Guarantors shall execute the
Guarantees thereon) that reflects the changed terms. Failure to make the
appropriate notation or issue a new Security shall not affect the validity and
effect of such amendment, supplement or waiver.
SECTION 9.06. Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article Nine; provided that the Trustee may, but
shall not be obligated to, execute any such amendment, supplement or waiver
which affects the Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall be
90
fully protected in relying upon, an Opinion of Counsel and an Officers'
Certificate each stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article Nine is authorized or permitted by
this Indenture.
ARTICLE TEN
MISCELLANEOUS
SECTION 10.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
SECTION 10.02. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, or overnight courier addressed as follows:
if to the Company or any Guarantor:
Lodestar Holdings, Inc.
00 Xxxxxxxxxxx Xxxxx,
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chairman
with copies to:
Lodestar Energy, Inc.
000 Xxxx Xxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: R. Xxxxxxx Xxxxx, Esq.
and
91
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxx, Esq.,
if to the Trustee:
State Street Bank and Trust Company
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Each of the Company, the Guarantors and the Trustee by written notice
to each other such person may designate additional or different addresses for
notices to such person. Any notice or communication to the Company, the
Guarantors or the Trustee shall be deemed to have been given or made as of the
date so delivered, if personally delivered; when answered back, if telexed; when
receipt is acknowledged, if faxed; and five (5) calendar days after mailing, if
sent by registered or certified mail, postage prepaid (except that a notice of
change of address shall not be deemed to have been given until actually received
by the addressee).
Any notice or communication mailed to a Securityholder, including any
notice delivered in connection with TIA ss. 310(b), TIA ss. 313(c), TIA ss.
314(a) and TIA ss. 315(b), shall be mailed to him by first class mail or other
equivalent means at his address as it appears on the registration books of the
Registrar and shall be sufficiently given to him if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 10.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company,
92
the Guarantors, the Trustee, the Registrar and any other person shall have the
protection of TIA ss. 312(c).
SECTION 10.04. Certificate and Opinion as to Conditions
Precedent.
Upon any request or application by the Company or the Guarantors to the
Trustee to take any action under this Indenture, the Company shall furnish to
the Trustee:
(1) an Officers' Certificate, in form and substance satisfactory to the
Trustee, stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 10.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion of each such
person, such condition or covenant has been complied with.
93
SECTION 10.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Securityholders. The Paying
Agent or Registrar may make reasonable rules for its functions.
SECTION 10.07. Legal Holidays.
A "Legal Holiday" used with respect to a particular place of payment is
a Saturday, a Sunday or a day on which banking institutions in New York, New
York or at such place of payment are not required to be open. If a payment date
is a Legal Holiday at such place, payment may be made at such place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
SECTION 10.08. Governing Law.
THIS INDENTURE, THE SECURITIES AND THE GUARANTEES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED
TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS. Each of the parties hereto agrees to submit to
the jurisdiction of the courts of the State of New York in any action or
proceeding arising out of or relating to this Indenture.
SECTION 10.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company, the Guarantors, or any of their Subsidiaries. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
SECTION 10.10. No Recourse Against Others.
A director, officer, employee, stockholder or Affiliate, as such, of
the Company or the Guarantors shall not have any liability for any obligations
of the Company or the Guarantors under the Securities or this Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. Such waiver and release are part of the consideration for the
issuance of the Securities.
94
SECTION 10.11. Successors.
All agreements of the Company and the Guarantors in this Indenture and
the Securities shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successor.
SECTION 10.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together shall represent the
same agreement.
SECTION 10.13. Severability.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, in any respect for any reason, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
ARTICLE ELEVEN
GUARANTEE OF SECURITIES
SECTION 11.01. Unconditional Guarantee.
Subject to the provisions of this Article Eleven, each of the
Guarantors hereby, jointly and severally, unconditionally and irrevocably
guarantees, on a senior basis, (such guarantee to be referred to herein as a
"Guarantee") to each Holder of a Note authenticated and delivered by the Trustee
and to the Trustee and its successors and assigns, irrespective of the validity
and enforceability of this Indenture, the Securities or the obligations of the
Company or any other Guarantors to the Holders or the Trustee hereunder or
thereunder, that: (a) the principal of, premium, if any, and interest on the
Securities shall be duly and punctually paid in full when due, whether at
maturity, upon redemption at the option of Holders pursuant to the provisions of
the Securities relating thereto, by acceleration or otherwise, and interest on
the overdue principal and (to the extent permitted by law) interest, if any, on
the Securities and all other obligations of the Company or the Guarantors to the
Holders or the Trustee hereunder or thereunder (including amounts due the
Trustee under Section 7.07 hereof) and all other obligations shall be promptly
paid in
95
full or performed, all in accordance with the terms hereof and thereof; and (b)
in case of any extension of time of payment or renewal of any Securities or any
of such other obligations, the same shall be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed, or failing performance of any other obligation of the Company to
the Holders under this Indenture or under the Securities, for whatever reason,
each Guarantor shall be obligated to pay, or to perform or cause the performance
of, the same immediately. An Event of Default under this Indenture or the
Securities shall constitute an event of default under this Guarantee, and shall
entitle the Holders of Securities to accelerate the obligations of the
Guarantors hereunder in the same manner and to the same extent as the
obligations of the Company.
Each of the Guarantors hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions hereof or thereof, any release of any other Guarantor,
the recovery of any judgment against the Company, any action to enforce the
same, whether or not a Guarantee is affixed to any particular Security, or any
other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a Guarantor. Each of the Guarantors hereby waives the
benefit of diligence, presentment, demand of payment, filing of claims with a
court in the event of insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest, notice and all demands
whatsoever and covenants that its Guarantee shall not be discharged except by
complete performance of the obligations contained in the Securities, this
Indenture and this Guarantee. This Guarantee is a guarantee of payment and not
of collection. If any Holder or the Trustee is required by any court or
otherwise to return to the Company or to any Guarantor, or any custodian,
trustee, liquidator or other similar official acting in relation to the Company
or such Guarantor, any amount paid by the Company or such Guarantor to the
Trustee or such Holder, this Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor further agrees
that, as between it, on the one hand, and the Holders of Securities and the
Trustee, on the other hand, (a) subject to this Article Eleven, the maturity of
the obligations guaranteed hereby may be accelerated as provided in Article Six
hereof for the purposes of this Guarantee, notwithstanding any stay,
96
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (b) in the event of any acceleration of such
obligations as provided in Article Six hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by the Guarantors for
the purpose of this Guarantee.
No stockholder, officer, director, employee or incorporator, past,
present or future, or any Guarantor, as such, shall have any personal liability
under this Guarantee by reason of his, her or its status as such stockholder,
officer, director, employee or incorporator.
Each Guarantor that makes a payment or distribution under its Guarantee
shall be entitled to a contribution from each other Guarantor in an amount pro
rata based on the net assets of each Guarantor, determined in accordance with
GAAP.
SECTION 11.02. Limitations on Guarantees.
The obligations of each Guarantor under its Guarantee are limited to
the maximum amount which, after giving effect to all other contingent and fixed
liabilities of such Guarantor and after giving effect to any collections from or
payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to its
contribution obligations under this Indenture, will result in the obligations of
such Guarantor under the Guarantee not constituting a fraudulent conveyance or
fraudulent transfer under any Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar U.S. federal or state or
other applicable law.
SECTION 11.03. Execution and Delivery of Guarantee.
To further evidence the Guarantee set forth in Section 11.01, each
Guarantor hereby agrees that a notation of such Guarantee, substantially in the
form of Exhibit M herein, shall be endorsed on each Security authenticated and
delivered by the Trustee. Such Guarantee shall be executed on behalf of each
Guarantor by either manual or facsimile signature of two Officers of each
Guarantor, each of whom, in each case, shall have been duly authorized to so
execute by all requisite corporate action. The validity and enforceability of
any Guarantee shall not be affected by the fact that it is not affixed to any
particular Security.
97
Each of the Guarantors hereby agrees that its Guarantee set forth in
Section 11.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Security a notation of such Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Guarantee no longer holds that office at the time the Trustee authenticates the
Security on which such Guarantee is endorsed or at any time thereafter, such
Guarantor's Guarantee of such Security shall be valid nevertheless.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set forth in
this Indenture on behalf of each Guarantor.
SECTION 11.04. Release of a Guarantor.
(a) If no Default exists or would exist under this Indenture, upon the
sale or disposition of all of the Capital Stock of a Guarantor by the Company,
in a transaction constituting an Asset Sale the Net Cash Proceeds of which are
applied in accordance with Section 4.16, or upon the consolidation or merger of
a Guarantor with or into any person in compliance with Article Five (in each
case, other than to the Company or an Affiliate of the Company), or if any
Guarantor is dissolved or liquidated in accordance with this Indenture, such
Guarantor's Guarantee shall be released, and such Guarantor and each Subsidiary
of such Guarantor that is also a Guarantor shall be deemed released from all
obligations under this Article Eleven without any further action required on the
part of the Trustee or any Holder. Any Guarantor not so released or the entity
surviving such Guarantor, as applicable, shall remain or be liable under its
Guarantee as provided in this Article Eleven.
(b) The Trustee shall deliver an appropriate instrument evidencing the
release of a Guarantor upon receipt of a request by the Company or such
Guarantor accompanied by an Officers' Certificate and an Opinion of Counsel
certifying as to the compliance with this Section 11.04, provided the legal
counsel delivering such Opinion of Counsel may rely as to matters of fact on one
or more Officers Certificates of the Company.
The Trustee shall execute any documents reasonably requested by the
Company or a Guarantor in order to evidence the release of such Guarantor from
its obligations under its
98
Guarantee endorsed on the Securities and under this Article Eleven.
Except as set forth in Articles Four and Five and this Section 11.04,
nothing contained in this Indenture or in any of the Securities shall prevent
any consolidation or merger of a Guarantor with or into the Company or another
Guarantor or shall prevent any sale or conveyance of the property of a Guarantor
as an entirety or substantially as an entirety to the Company or another
Guarantor.
SECTION 11.05. Waiver of Subrogation.
Until this Indenture is discharged and all of the Securities are
discharged and paid in full, each Guarantor hereby irrevocably waives and agrees
not to exercise any claim or other rights which it may now or hereafter acquire
against the Company that arise from the existence, payment, performance or
enforcement of the Company's obligations under the Securities or this Indenture
and such Guarantor's obligations under this Guarantee and this Indenture, in any
such instance including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, indemnification, and any right to
participate in any claim or remedy of the Holders against the Company, whether
or not such claim, remedy or right arises in equity, or under contract, statute
or common law, including, without limitation, the right to take or receive from
the Company, directly or indirectly, in cash or other property or by set-off or
in any other manner, payment or security on account of such claim or other
rights. If any amount shall be paid to any Guarantor in violation of the
preceding sentence and any amounts owing to the Trustee or the Holders of
Securities under the Securities, this Indenture, or any other document or
instrument delivered under or in connection with such agreements or instruments,
shall not have been paid in full, such amount shall have been deemed to have
been paid to such Guarantor for the benefit of, and held in trust for the
benefit of, the Trustee or the Holders and shall forthwith be paid to the
Trustee for the benefit of itself or such Holders to be credited and applied to
the obligations in favor of the Trustee or the Holders, as the case may be,
whether matured or unmatured, in accordance with the terms of this Indenture.
Each Guarantor acknowledges that it will receive direct and indirect benefits
from the financing arrangements contemplated by this Indenture and that the
waiver set forth in this Section 11.05 is knowingly made in contemplation of
such benefits.
99
SECTION 11.06. Immediate Payment.
Each Guarantor agrees to make immediate payment to the Trustee on
behalf of the Holders of all Obligations owing or payable to the respective
Holders upon receipt of a demand for payment therefor by the Trustee to such
Guarantor in writing.
SECTION 11.07. No Set-Off.
Each payment to be made by a Guarantor hereunder in respect of the
Obligations shall be payable in the currency or currencies in which such
Obligations are denominated, and shall be made without set-off, counterclaim,
reduction or diminution of any kind or nature.
SECTION 11.08. Obligations Continuing.
The obligations of each Guarantor hereunder shall be continuing and
shall remain in full force and effect until all the obligations have been paid
and satisfied in full. Each Guarantor agrees with the Trustee that it will from
time to time deliver to the Trustee suitable acknowledgments of this continued
liability hereunder.
SECTION 11.09. Obligations Reinstated.
The obligations of each Guarantor hereunder shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
which would otherwise have reduced the obligations of any Guarantor hereunder
(whether such payment shall have been made by or on behalf of the Company or by
or on behalf of a Guarantor) is rescinded or reclaimed from any of the Holders
upon the insolvency, bankruptcy, liquidation or reorganization of the Company or
any Guarantor or otherwise, all as though such payment had not been made. If
demand for, or acceleration of the time for, payment by the Company is stayed
upon the insolvency, bankruptcy, liquidation or reorganization of the Company,
all such Indebtedness otherwise subject to demand for payment or acceleration
shall nonetheless be payable by each Guarantor as provided herein.
SECTION 11.10. Obligations Not Affected.
The obligations of each Guarantor hereunder shall not be affected,
impaired or diminished in any way by any act, omission, matter or thing
whatsoever, occurring before, upon or
100
after any demand for payment hereunder (and whether or not known or consented to
by any Guarantor or any of the Holders) which, but for this provision, might
constitute a whole or partial defense to a claim against any Guarantor hereunder
or might operate to release or otherwise exonerate any Guarantor from any of its
obligations hereunder or otherwise affect such obligations, whether occasioned
by default of any of the Holders or otherwise.
SECTION 11.11. Waiver.
Without in any way limiting the provisions of Section 11.01 hereof,
each Guarantor hereby waives notice or proof of reliance by the Holders upon the
obligations of any Guarantor hereunder, and diligence, presentment, demand for
payment on the Company, protest or notice of dishonor of any of the Obligations,
or other notice or formalities to the Company of any kind whatsoever.
SECTION 11.12. No Obligation To Take Action Against the Company.
Neither the Trustee nor any other person shall have any obligation to
enforce or exhaust any rights or remedies or to take any other steps under any
security for the Obligations or against the Company or any other person or any
property of the Company or any other person before the Trustee is entitled to
demand payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantees or under this Indenture.
SECTION 11.13. Dealing with the Company and Others.
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
hereunder and without the consent of or notice to any Guarantor, may
(a) grant time, renewals, extensions, compromises, concessions,
waivers, releases, discharges and other indulgences to the Company or any other
person;
(b) take or abstain from taking security or collateral from the Company
or from perfecting security or collateral of the Company;
(c) release, discharge, compromise, realize, enforce or otherwise deal
with or do any act or thing in respect
101
of (with or without consideration) any and all collateral, mortgages or other
security given by the Company or any third party with respect to the obligations
or matters contemplated by this Indenture or the Securities;
(d) accept compromises or arrangements from the Company;
(e) apply all monies at any time received from the Company or from any
security upon such part of the Obligations as the Holders may see fit or change
any such application in whole or in part from time to time as the Holders may
see fit; and
(f) otherwise deal with, or waive or modify their right to deal with,
the Company and all other persons and any security as the Holders or the Trustee
may see fit.
SECTION 11.14. Default and Enforcement.
If any Guarantor fails to pay in accordance with Section 11.06 hereof,
the Trustee may proceed in its name as trustee hereunder in the enforcement of
the Guarantee of any such Guarantor and such Guarantor's obligations thereunder
and hereunder by any remedy provided by law, whether by legal proceedings or
otherwise, and to recover from such Guarantor the obligations.
SECTION 11.15. Amendment, Etc.
No amendment, modification or waiver of any provision of this Indenture
relating to any Guarantor or consent to any departure by any Guarantor or any
other person from any such provision will in any event be effective unless it is
signed by such Guarantor and the Trustee.
SECTION 11.16. Acknowledgment.
Each Guarantor hereby acknowledges communication of the terms of this
Indenture and the Securities and consents to and approves of the same.
SECTION 11.17. Costs and Expenses.
Each Guarantor shall pay on demand by the Trustee any and all costs,
fees and expenses (including, without limitation, legal fees on a solicitor and
client basis) incurred by
102
the Trustee, its agents, advisors and counsel or any of the Holders in enforcing
any of their rights under any Guarantee.
SECTION 11.18. No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Trustee or the Holders, any right, remedy, power or privilege hereunder or under
this Indenture or the Securities, shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, remedy, power or privilege
hereunder or under this Indenture or the Securities preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges in the Guarantee and
under this Indenture, the Securities and any other document or instrument
between a Guarantor and/or the Company and the Trustee are cumulative and not
exclusive of any rights, remedies, powers and privilege provided by law.
SECTION 11.19. Survival of Obligations.
Without prejudice to the survival of any of the other obligations of
each Guarantor hereunder, the obligations of each Guarantor under Section 11.01
and shall be enforceable against such Guarantor without regard to and without
giving effect to any right of offset or counterclaim available to or which may
be asserted by the Company or any Guarantor.
SECTION 11.20. Guarantee in Addition to Other Obligations.
The obligations of each Guarantor under its Guarantee and this
Indenture are in addition to and not in substitution for any other obligations
to the Trustee or to any of the Holders in relation to this Indenture or the
Securities (including the Purchase Agreement and the Registration Rights
Agreement).
SECTION 11.21. Severability.
Any provision of this Article Eleven which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
and any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction
unless its removal would substantially defeat the basic intent, spirit and
purpose of this Indenture and this Article Eleven.
103
SECTION 11.22. Successors and Assigns.
Each Guarantee shall be binding upon and inure to the benefit of each
Guarantor and the Trustee and the other Holders and their respective successors
and permitted assigns, except that no Guarantor may assign any of its
obligations hereunder or thereunder.
104
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the date first written above.
LODESTAR HOLDINGS, INC.,
as Issuer
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxx
Chief Financial Officer
LODESTAR ENERGY, INC.,
as Guarantor
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
EASTERN RESOURCES, INC.,
as Guarantor
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
INDUSTRIAL FUELS MINERALS COMPANY,
as Guarantor
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Xxxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
000
XXXXX XXXXXX BANK AND TRUST COMPANY,
as Trustee
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx
Vice President
106
EXHIBIT A
[FORM OF SERIES A NOTE]
[If a Restricted Security, then insert -- THIS SENIOR NOTE (OR ITS PREDECESSOR)
HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER: (A)
REPRESENTS THAT (1) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) (A "QIB") OR (2) IT HAS ACQUIRED THIS SENIOR NOTE
IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES
ACT; (B) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SENIOR NOTE
EXCEPT (1) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (2) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (3) IN
AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE
SECURITIES ACT, (4) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, (5) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS SENIOR NOTE (THE
FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN
RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF SENIOR NOTES LESS THAN $250,000, AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT, (6) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY) OR (7) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (C)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SENIOR NOTE OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES"
HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES
ACT. THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO
REGISTER ANY TRANSFER OF THIS SENIOR NOTE IN VIOLATION OF THE FOREGOING.]
[If a Temporary Regulation S Global Security, then insert -- THIS SECURITY IS A
TEMPORARY REGULATION S GLOBAL SECURITY
A-1
WITHIN THE MEANING OF THE INDENTURE REFERRED TO HEREINAFTER. EXCEPT IN THE
CIRCUMSTANCES DESCRIBED IN SECTION 2.06 OF THE INDENTURE, INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY NOT BE OFFERED OR SOLD TO A U.S.
PERSON OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON PRIOR TO THE EXPIRATION OF
THE RESTRICTED PERIOD (AS DEFINED IN THE INDENTURE), AND NO TRANSFER OR EXCHANGE
OF AN INTEREST IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE MADE FOR AN
INTEREST IN A RESTRICTED GLOBAL SECURITY OR IN A PERMANENT REGULATION S GLOBAL
SECURITY UNTIL AFTER THE LATER OF THE DATE OF EXPIRATION OF THE RESTRICTED
PERIOD AND THE DATE ON WHICH THE OWNER SECURITIES CERTIFICATION AND THE
DEPOSITORY SECURITIES CERTIFICATION RELATING TO SUCH INTEREST HAVE BEEN PROVIDED
IN ACCORDANCE WITH THE TERMS OF THE INDENTURE, TO THE EFFECT THAT THE BENEFICIAL
OWNER OR OWNERS OF SUCH INTEREST ARE NOT U.S. PERSONS.]
[If a Permanent Regulation S Security, then insert -- THE SECURITIES
EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933 (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, OR DELIVERED IN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON,
UNLESS THE SECURITIES ARE REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE.]
A-2
LODESTAR HOLDINGS, INC.
11 1/2% Senior Note
due 2005, Series A
CUSIP No.
No. $
Lodestar Holdings, Inc., a Delaware corporation (the "Company," which
term includes any successor entity), for value received promises to pay to
____________ or registered assigns, the principal sum of
Dollars, on May 15, 2005.
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
A-3
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
Dated: May 15, 1998
LODESTAR HOLDINGS, INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
A-4
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Series A Senior Notes described in the
within-mentioned Indenture.
STATE STREET BANK AND TRUST
COMPANY,
as Trustee
By:
------------------------------------
Authorized Signatory
A-5
LODESTAR HOLDINGS, INC.
11 1/2% Senior Note
due 2005, Series A
1. Interest.
LODESTAR HOLDINGS, INC., a Delaware corporation (the "Company"),
promises to pay cash interest on the principal amount of this Security at the
rate per annum shown above. The Company will pay interest semi-annually in
arrears on May 15 and November 15 of each year (the "Interest Payment Date"),
commencing November 15, 1998. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and interest on
overdue installments of interest, to the extent lawful, at a rate equal to 13
1/2% per annum.
2. Method of Payment.
The Company shall pay interest on the Securities (except defaulted
interest) to the persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date even if the
Securities are canceled on registration of transfer or registration of exchange
after such Record Date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company shall pay principal and interest in
money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Company
may pay principal and interest by wire transfer of Federal funds, or interest by
its check payable in such U.S. Legal Tender. The Company may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address. Notwithstanding the foregoing, the Company shall pay or cause to be
paid all amounts payable with respect to Restricted Securities or non-DTC
eligible Securities by wire transfer of Federal funds to the account of the
Holders of such Securities. If this Security is a Global Security, all payments
in respect of this Security will be made to the Depository or its nominee in
immediately available funds in accordance with customary procedures established
from time to time by the Depository.
3. Paying Agent and Registrar.
Initially, STATE STREET BANK AND TRUST COMPANY (the "Trustee"), will
act as Paying Agent and Registrar. The Company
A-6
may change any Paying Agent or Registrar without notice to the Holders.
4. Indenture.
The Company issued the Securities under an Indenture, dated as of May
15, 1998 (the "Indenture"), by and among the Company, the Guarantors and the
Trustee. This Security is one of a duly authorized issue of Securities of the
Company designated as its 11 1/2% Senior Notes due 2005, Series A (the "Series A
Notes"). Capitalized terms herein are used as defined in the Indenture unless
otherwise defined herein. The terms of the Securities include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S. Code xx.xx. 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and said Act for a statement of them. The
Securities are general obligations of the Company limited in aggregate principal
amount to $235,000,000.
5. Registration Rights.
Pursuant to the Registration Rights Agreement by and between the
Company, the Guarantors and the initial purchasers of the Series A Notes, the
Company and the Guarantors will be obligated to consummate an exchange offer
pursuant to which the Holder of this Security shall have the right to exchange
this Security for 11 1/2% Senior Notes due 2005, Series B, of the Company (the
"Series B Notes"), which have been registered under the Securities Act, in like
principal amount and having identical terms as the Series A Notes. The Holders
of Series A Notes shall be entitled to receive certain additional interest
payments in the event such exchange offer is not consummated and upon certain
other conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement. Notes and the Series B Notes are together
referred to herein as the "Securities."
6. Optional Redemption.
The Securities will be subject to redemption, in whole or in part, at
the option of the Company, at any time on or after May 15, 2002, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued interest to the redemption date, if redeemed during the 12-month
period beginning on May 15 of the years indicated below:
A-7
Year Percentage
---- ----------
2002............................................ 105.750%
2003............................................ 102.875%
2004 and thereafter............................. 100.000%
In addition, at any time prior to May 15, 2001, the Company may redeem
up to 35% of (x) the aggregate principal amount of the Securities issued on the
Issue Date plus (y) any additional Securities issued after the Issue Date
pursuant to the Indenture, with the proceeds of one or more Equity Offerings at
a redemption price (expressed as a percentage of principal amount) of 111.5%
plus accrued interest to the redemption date; provided that at least 65% of the
sum of (x) the aggregate principal amount of Securities issued on the Issue Date
plus (y) any additional Securities issued after the Issue Date pursuant to the
Indenture remains outstanding immediately after any such redemption. In order to
effect the foregoing redemption with the proceeds of any Equity Offering, the
Company shall make such redemption not more than 120 days after the consummation
of any such Equity Offering. "Equity Offering" means an offering of Qualified
Capital Stock of the Company (other than any Subsidiary of the Company).
7. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of Securities to be redeemed
at such Holder's registered address. Securities in denominations larger than
$1,000 may be redeemed in part.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Securities called for redemption shall
have been deposited with the Paying Agent for redemption on such Redemption
Date, then, unless the Company defaults in the payment of such Redemption Price,
the Securities called for redemption will cease to bear interest and the only
right of the Holders of such Securities will be to receive payment of the
Redemption Price.
8. Change of Control Offer.
Upon the occurrence of a Change of Control, upon the satisfaction of
the conditions set forth in the Indenture, the Company shall be required to
offer to purchase all of the then outstanding Securities pursuant to a Change of
Control Offer at a purchase price equal to 101% of the principal amount thereof
plus accrued interest, if any, to the date of purchase. Holders of Securities
which are the subject of such an offer to repurchase shall receive an offer to
repurchase and may elect to
A-8
have such Securities repurchased in accordance with the provisions of the
Indenture pursuant to and in accordance with the terms of the Indenture.
9. Limitation on Disposition of Assets.
Under certain circumstances, the Company is required to apply the net
proceeds from Asset Sales to repurchase Securities at a price equal to 100% of
the aggregate principal amount thereof, plus accrued interest to the date of
purchase.
10. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities or portions thereof selected for redemption. No service
charge shall be made for any registration of transfer or exchange or redemption
of Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
11. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the owner of it
for all purposes.
With respect to Global Securities, the Depository may grant proxies and
otherwise authorize Holders of Book-Entry Securities to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action which a Holder of a Security is entitled to give or take under the
Indenture.
12. Unclaimed Money.
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee and the Paying Agent will pay the money back to the
Company at its request. After that, all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
A-9
13. Discharge Prior to Redemption or Maturity.
The Company's obligations pursuant to the Indenture will be discharged,
except for obligations pursuant to certain sections thereof, subject to the
terms of the Indenture, upon the payment of all the Securities or upon the
irrevocable deposit with the Trustee of money or U.S. Government Obligations
sufficient to pay when due principal of, and premium, if any, and interest on
the Securities to maturity or redemption, as the case may be.
14. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default or compliance with any provision may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding. Without notice to or consent of any
Holder, the parties thereto may amend, waive or supplement the Indenture or the
Securities to, among other things, cure any ambiguity, defect or inconsistency,
provide for uncertificated Securities in addition to or in place of certificated
Securities, comply with Article Five of the Indenture or comply with any
requirements of the SEC in connection with the qualification of the Indenture
under the TIA, or make any other change that does not adversely affect the
rights of any Holder of a Security.
15. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the Company
and its Restricted Subsidiaries to, among other things, incur additional
Indebtedness or Liens, make payments in respect of its Capital Stock and merge
or consolidate with any other person and sell, lease, transfer or otherwise
dispose of substantially all of certain of its properties or assets. The
limitations are subject to a number of important qualifications and exceptions.
The Company must annually report to the Trustee on compliance with such
limitations.
16. Successors.
When a successor assumes all the obligations of its predecessor under
the Securities and the Indenture, the predecessor will be released from those
obligations.
A-10
17. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable in the manner,
at the time and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount of the Securities then outstanding to direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Securities notice of any continuing Default or Event of Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in their interest.
18. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Company, the Guarantors, their Subsidiaries or their respective
Affiliates as if it were not the Trustee.
19. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator, as such,
of the Company or the Guarantors shall have any liability for any obligation of
the Company or the Guarantors under the Securities or the Indenture or for any
claim based on, in respect of or by reason of, such obligations or their
creation. Each Holder of a Security by accepting a Security waives and releases
all such liability. The waiver and release are part of the consideration for the
issuance of the Securities.
20. Authentication.
This Security shall not be valid until the Trustee or authenticating
agent manually signs the certificate of authentication on this Security.
21. Governing Law.
The Laws of the State of New York shall govern this Security and the
Indenture.
A-11
22. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of a
Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities immediately prior to the qualification of the
Indenture under the TIA as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
24. Guarantees.
This Security will be entitled to the benefits of certain Guarantees
made for the benefit of the Holders. Reference is hereby made to the Indenture
for a statement of the respective rights, limitations of rights, duties and
obligations thereunder of the Guarantors, the Trustee and the Holders.
25. Indenture.
Each Holder, by accepting a Security, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.
The Company will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture. Requests may be made to:
LODESTAR HOLDINGS, INC., 00 Xxxxxxxxxxx Xxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx
00000, Attn.: Chief Financial Officer.
26. Certain Information Obligations.
At any time when the Company is not subject to Section 13 or 15(d) of
the Securities Exchange Act of 1934, upon the request of a Holder of a Series A
Note, the Company will promptly furnish or cause to be furnished such
information as is specified pursuant to Rule 144A(d)(4) under the Securities Act
(or any successor provision thereto) to such Holder or to a prospective
purchaser of such Series A Security designated by such Holder, as the case may
be, in order to permit compliance by such Holder with Rule 144A under the
Securities Act.
A-12
[The form of reverse of a Temporary Regulation S Global Security shall
be as set forth below --
Until this Temporary Regulation S Global Security is exchanged for a
Permanent Regulation S Global Security, the Holder hereof shall not be entitled
to receive payments of interest hereon; until so exchanged in full, this
Temporary Regulation S Global Security shall in all other respects be entitled
to the same benefits as other Securities under the Indenture.
This Temporary Regulation S Global Security is exchangeable in whole or
in part for one or more Permanent Regulation S Global Securities or Restricted
Global Securities only (i) on or after the expiration of the Restricted Period
and (ii) upon presentation of certificates (accompanied by an Opinion of
Counsel, if applicable) required by Article II of the Indenture. Upon exchange
of this Temporary Regulation S Global Security for one or more Permanent
Regulation S Global Securities or Restricted Global Securities, the Trustee
shall cancel this Temporary Regulation S Global Security.
This Temporary Regulation S Global Security shall not become valid or
obligatory until the certificate of authentication hereon shall have been duly
manually signed by the Trustee in accordance with the Indenture. This Temporary
Regulation S Global Security shall be governed by and construed in accordance
with the laws of the State of New York.
A-13
SCHEDULE OF EXCHANGES FOR GLOBAL SECURITIES
The following exchanges of a part of this Temporary Regulation S Global
Security for other Global Securities have been made:
Amount of Amount of Principal Amount of
decrease in increase in this Global Signature of
Principal Amount Principal Amount Security following authorized
of this Global of this Global such decrease (or officer of
Date of Exchange Security Security increase) Trustee
---------------- ---------------- --------------- ------------------- -------------
A-14
[FORM OF ASSIGNMENT]
I or we assign this Security to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee)
Please insert Social Security or other
identifying number of assignee
---------------------------------------
and irrevocably appoint _______________________ agent to transfer this Security
on the books of the Company. The agent may substitute another to act for him.
Dated: Signed:
--------------------------- ------------------------------------
(Sign exactly as your name appears on
the front of this Security)
Signature Guarantee:
----------------------------------------------------------
A-15
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.15 or Section 4.16 of the Indenture, check the appropriate
box:
Section 4.15 / /
Section 4.16 / /
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.15 or Section 4.16 of the Indenture, state the
amount:
$
Dated: Signed:
--------------------------- ------------------------------------
(Sign exactly as your name appears on
the front of this Security)
Signature Guarantee:
----------------------------------------------------------
A-16
EXHIBIT B
[FORM OF SERIES B NOTE]
LODESTAR HOLDINGS, INC.
11 1/2% Senior Note
due 2005, Series B
CUSIP No.
No. $
LODESTAR HOLDINGS, INC., a Delaware corporation (the "Company," which
term includes any successor entity), for value received promises to pay to
___________________ or registered assigns, the principal sum of ____________
Dollars, on May 15, 2005.
Interest Payment Dates: May 15 and November 15
Record Dates: May 1 and November 1
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
Dated:
LODESTAR HOLDINGS, INC.
By:
------------------------------------
Name:
Title:
By:
------------------------------------
Name:
Title:
B-1
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Series B Notes described in the within-mentioned
Indenture.
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:
-------------------------------------
Authorized Signatory
B-2
LODESTAR HOLDINGS, INC.
11 1/2% Senior Note
due 2005, Series B
1. Interest.
LODESTAR HOLDINGS, INC., a Delaware corporation (the "Company"),
promises to pay cash interest on the principal amount of this Security at the
rate per annum shown above. The Company will pay interest semi-annually in
arrears on May 15 and November 15 of each year (the "Interest Payment Date"),
commencing November 15, 1998. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and interest on
overdue installments of interest, to the extent lawful, at a rate equal to 13
1/2% per annum.
2. Method of Payment.
The Company shall pay interest on the Securities (except defaulted
interest) to the persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date even if the
Securities are canceled on registration of transfer or registration of exchange
after such Record Date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company shall pay principal and interest in
money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Company
may pay principal and interest by wire transfer of Federal funds, or interest by
its check payable in such U.S. Legal Tender. The Company may deliver any such
interest payment to the Paying Agent or to a Holder at the Holder's registered
address.
3. Paying Agent and Registrar.
Initially, STATE STREET BANK AND TRUST COMPANY (the "Trustee") will act
as Paying Agent and Registrar. The Company may change any Paying Agent or
Registrar without notice to the Holders.
4. Indenture.
The Company issued the Securities under an Indenture, dated as of May
15, 1998 (the "Indenture"), by and among the Company, the Guarantors and the
Trustee. This Security is one of a duly authorized issue of Securities of the
Company designated
B-3
as its 11 1/2% Senior Notes due 2005, Series B (the "Series B Notes").
Capitalized terms herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S. Code xx.xx. 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything to the contrary
herein, the Securities are subject to all such terms, and Holders of Securities
are referred to the Indenture and said Act for a statement of them. The
Securities are general obligations of the Company limited in aggregate principal
amount to $235,000,000.
5. Exchange Offer.
The Series B Notes were issued pursuant to an exchange offer pursuant
to which 11 1/2% Senior Notes due 2005, Series A, of the Company (the "Series A
Notes"), in like principal amount and having substantially identical terms as
the Series B Notes, were exchanged for the Series B Notes. The Series A Notes
and the Series B Notes are together referred to herein as the "Securities."
6. Optional Redemption.
The Securities will be subject to redemption, in whole or in part, at
the option of the Company, at any time on or after May 15, 2002, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued interest to the redemption date, if redeemed during the 12-month
period beginning on May 15 of the years indicated below:
Year Percentage
---- ----------
2002............................................ 105.750%
2003............................................ 102.875%
2004 and thereafter............................. 100.000%
In addition, at any time prior to May 15, 2001, the Company may redeem
up to 35% of (x) the aggregate principal amount of the Securities issued on the
Issue Date plus (y) any additional Securities issued after the Issue Date
pursuant to the Indenture, with the proceeds of one or more Equity Offerings at
a redemption price (expressed as a percentage of principal amount) of 111.5%
plus accrued interest to the redemption date; provided that at least 65% of the
sum of (x) the aggregate principal amount of Securities issued on the Issue Date
plus (y) any additional Securities issued after the Issue Date pursuant to the
Indenture remains outstanding immediately after
B-4
any such redemption. In order to effect the foregoing redemption with the
proceeds of any Equity Offering, the Company shall make such redemption not more
than 120 days after the consummation of any such Equity Offering. "Equity
Offering" means an offering of Qualified Capital Stock of the Company (other
than any Subsidiary of the Company).
7. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of Securities to be redeemed
at such Holder's registered address. Securities in denominations larger than
$1,000 may be redeemed in part.
Except as set forth in the Indenture, from and after any Redemption
Date, if monies for the redemption of the Securities called for redemption shall
have been deposited with the Paying Agent for redemption on such Redemption
Date, then, unless the Company defaults in the payment of such Redemption Price,
the Securities called for redemption will cease to bear interest and the only
right of the Holders of such Securities will be to receive payment of the
Redemption Price.
8. Change of Control Offer.
Upon the occurrence of a Change of Control, upon the satisfaction of
the conditions set forth in the Indenture, the Company shall be required to
offer to purchase all of the then outstanding Securities pursuant to a Change of
Control Offer at a purchase price equal to 101% of the principal amount thereof
plus accrued interest, if any, to the date of purchase. Holders of Securities
which are the subject of such an offer to repurchase shall receive an offer to
repurchase and may elect to have such Securities repurchased in accordance with
the provisions of the Indenture pursuant to and in accordance with the terms of
the Indenture.
9. Limitation on Disposition of Assets.
Under certain circumstances, the Company is required to apply the net
proceeds from Asset Sales to repurchase Securities at a price equal to 100% of
the aggregate principal amount thereof, plus accrued interest to the date of
purchase.
10. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer of or exchange Securities in accordance with the
Indenture. The Registrar may
B-5
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay certain transfer taxes or similar governmental
charges payable in connection therewith as permitted by the Indenture. The
Registrar need not register the transfer of or exchange any Securities or
portions thereof selected for redemption. No service charge shall be made for
any registration of transfer or exchange or redemption of Securities, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
11. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the owner of it
for all purposes.
With respect to Global Securities, the Depository may grant proxies and
otherwise authorize Holders of Book-Entry Securities to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action which a Holder of a Security is entitled to give or take under the
Indenture.
12. Unclaimed Money.
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee and the Paying Agent will pay the money back to the
Company at its request. After that, all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
13. Discharge Prior to Redemption or Maturity.
The Company's obligations pursuant to the Indenture will be discharged,
except for obligations pursuant to certain sections thereof, subject to the
terms of the Indenture, upon the payment of all the Securities or upon the
irrevocable deposit with the Trustee of money or U.S. Government Obligations
sufficient to pay when due principal of, and premium, if any, and interest on
the Securities to maturity or redemption, as the case may be.
14. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities may be
amended or supplemented with the written consent of the Holders of at least a
majority in aggregate principal amount of the Securities then outstanding, and
any existing Default or Event of Default or compliance with any provision may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Securities then outstanding.
B-6
Without notice to or consent of any Holder, the parties thereto may amend, waive
or supplement the Indenture or the Securities to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of certificated Securities, comply with Article Five of
the Indenture or comply with any requirements of the SEC in connection with the
qualification of the Indenture under the TIA, or make any other change that does
not adversely affect the rights of any Holder of a Security.
15. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the Company
and its Restricted Subsidiaries to, among other things, incur additional
Indebtedness or Liens, make payments in respect of its Capital Stock and merge
or consolidate with any other person and sell, lease, transfer or otherwise
dispose of substantially all of certain of its properties or assets. The
limitations are subject to a number of important qualifications and exceptions.
The Company must annually report to the Trustee on compliance with such
limitations.
16. Successors.
When a successor assumes all the obligations of its predecessor under
the Securities and the Indenture, the predecessor will be released from those
obligations.
17. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable in the manner,
at the time and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee is not obligated to enforce the Indenture or the
Securities unless it has received indemnity satisfactory to it. The Indenture
permits, subject to certain limitations therein provided, Holders of a majority
in aggregate principal amount of the Securities then outstanding to direct the
Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders of Securities notice of any continuing Default or Event of Default
(except a Default in payment of principal or interest) if it determines that
withholding notice is in their interest.
B-7
18. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Company, the Guarantors, their Subsidiaries or their respective
Affiliates as if it were not the Trustee.
19. No Recourse Against Others.
No stockholder, director, officer, employee or incorporator, as such,
of the Company or the Guarantors shall have any liability for any obligation of
the Company or the Guarantors under the Securities or the Indenture or for any
claim based on, in respect of or by reason of, such obligations or their
creation. Each Holder of a Security by accepting a Security waives and releases
all such liability. The waiver and release are part of the consideration for the
issuance of the Securities.
20. Authentication.
This Security shall not be valid until the Trustee or authenticating
agent manually signs the certificate of authentication on this Security.
21. Governing Law.
The Laws of the State of New York shall govern this Security and the
Indenture.
22. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of a
Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company will cause CUSIP numbers to be
printed on the Securities immediately prior to the qualification of the
Indenture under the TIA as a convenience to the Holders of the Securities. No
representation is made as to the accuracy of such numbers as printed on the
Securities and reliance may be placed only on the other identification numbers
printed hereon.
B-8
24. Guarantees.
This Security will be entitled to the benefits of certain Guarantees
made for the benefit of the Holders. Reference is hereby made to the Indenture
for a statement of the respective rights, limitations of rights, duties and
obligations thereunder of the Guarantors, the Trustee and the Holders.
25. Indenture.
Each Holder, by accepting a Security, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.
The Company will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture. Requests may be made to:
LODESTAR HOLDINGS, INC., 00 Xxxxxxxxxxx Xxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx
00000, Attn.: Chief Financial Officer.
B-9
[FORM OF ASSIGNMENT]
I or we assign this Security to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee)
Please insert Social Security or other
identifying number of assignee
-----------------------------------------
and irrevocably appoint _______________________ agent to transfer this Security
on the books of the Company. The agent may substitute another to act for him.
Dated: Signed:
--------------------------- ------------------------------------
(Sign exactly as your name appears on
the front of this Security)
Signature Guarantee:
----------------------------------------------------------
B-10
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.15 or Section 4.16 of the Indenture, check the appropriate
box:
Section 4.15 / /
Section 4.16 / /
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.15 or Section 4.16 of the Indenture, state the
amount:
$
Dated: Signed:
--------------------------- ------------------------------------
(Sign exactly as your name appears on
the front of this Security)
Signature Guarantee:
----------------------------------------------------------
B-11
EXHIBIT C
FORM OF LEGEND FOR BOOK-ENTRY SECURITIES
Any Global Security authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN
THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED
IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER
OF THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER
NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), 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 IN
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.
C-1
EXHIBIT D
Transferee Letter of Representation
Lodestar Holdings, Inc.
00 Xxxxxxxxxxx Xxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
In connection with our proposed purchase of $ aggregate principal
amount of the 11 1/2% Senior Notes due 2005, Series A and 11 1/2% Senior Notes
due 2005, Series B (collectively, the "Securities") of The Lodestar Holdings,
Inc., a Delaware corporation (the "Company"), we confirm that:
1. We understand that the Securities have not been registered under
the Securities Act of 1933, as amended (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 Securities to offer, sell or otherwise transfer such Securities prior
to the date which is three years after the 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 Securities (or any predecessor thereto) (the "Resale Restriction
Termination Date") only (a) to the Company, (b) pursuant to a registration
statement which has been declared effective under the Securities Act, (c) so
long as the Securities are eligible for resale pursuant to Rule 144A under the
Securities Act, to a person we reasonably believe is a qualified institutional
buyer 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 subparagraph
(a)(1), (2), (3) or (7) of Rule 501 under the Securities Act that is purchasing
for his own account or for the account of such an institutional "accredited
investor," in each case in a minimum principal amount of Securities of $500,000,
(f) in an offshore transaction pursuant to Regulation S of the Securities Act or
(g) 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
D-1
or accounts be at all times within our or their control and to 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 Securities 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 Trustee, which shall provide, among other things, that the transferee is an
institutional "accredited investor" within the meaning of subparagraph (a)(1),
(2), (3) or (7) of Rule 501 under the Securities Act and that it is acquiring
such Securities for investment purposes and not for distribution in violation of
the Securities Act. Each purchaser acknowledges that the Company and the Trustee
reserve the right prior to any offer, sale or other transfer prior to the Resale
Restriction Termination Date of the Securities pursuant to clause (c), (d) or
(f) above to require the delivery of an opinion of counsel, certifications
and/or other information satisfactory to the Company and the Trustee.
2. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) purchasing
for our own account or for the account of such an institutional "accredited
investor," and we are acquiring the Securities 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 and 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 Securities, and we and any accounts for which we
are acting are each able to bear the economic risk of our or its investment.
3. We are acquiring at least $500,000 principal amount of the
Securities and we are acquiring the Securities purchased by us for our own
account or for one or more accounts as to each of which we exercise sole
investment discretion.
4. You are entitled to rely upon this letter and you are irrevocably
authorized to produce this letter or a copy
D-2
hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
--------------------------------------
(Name of Purchaser)
By:
-----------------------------------
Date:
---------------------------------
D-3
Upon transfer the Securities would be registered in the name of the new
beneficial owner as follows:
Name:
---------------------------------
Address:
------------------------------
Taxpayer ID Number:
-------------------
D-4
EXHIBIT E
[FORM OF CERTIFICATION TO BE GIVEN BY HOLDERS OF
BENEFICIAL INTEREST IN A TEMPORARY
REGULATION S GLOBAL SECURITY
TO EUROCLEAR OR CEDEL]
OWNER SECURITIES CERTIFICATION
LODESTAR HOLDINGS, INC.
11 1/2% Senior Notes due 2005
CUSIP No.______
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein, and State Street Bank and Trust
Company, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
This is to certify that, as of the date hereof, $ of the
above-captioned Securities (the "Securities") are beneficially owned by non-U.S.
person(s). As used in this paragraph, the term "U.S. person" has the meaning
given to it by Regulation S under the Securities Act of 1933, as amended.
We undertake to advise you promptly by tested telex on or prior to the
date on which you intend to submit your certification relating to the Securities
held by you for our account in accordance with your operating procedures if any
applicable statement herein is not correct on such date, and in the absence of
any such notification it may be assumed that this certification applies as of
such date.
We understand that this certificate is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such
E-1
proceedings. This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchasers.
Dated: __________, ____
By:
--------------------------------
As, or as agent for, the bene-
ficial owner(s) of the Securi-
ties to which this certificate
relates.
E-2
EXHIBIT F
[FORM OF CERTIFICATION TO BE GIVEN
BY THE EUROCLEAR OPERATOR OR
CEDEL BANK, SOCIETE ANONYME]
DEPOSITORY SECURITIES CERTIFICATION
LODESTAR HOLDINGS, INC.
11 1/2% Senior Notes due 2005
CUSIP No. ________
Reference is hereby made to the Indenture, dated as of May 15, 1998 (the
"Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation, as
issuer, the Guarantors named therein, and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This is to certify that, with respect to U.S.$ _________________ principal
amount of the above-captioned Securities (the "Securities"), except as set forth
below, we have received in writing, by tested telex or by electronic
transmission, from member organizations appearing in our records as persons
being entitled to a portion of the principal amount of the Securities (our
"Member Organizations"), certifications with respect to such portion,
substantially to the effect set forth in the Indenture.1
We further certify (i) that we are not making available herewith for exchange
(or, if relevant, exercise of any rights or collection of any interest) any
portion of the Temporary Regulation S Global Security (as defined in the
Indenture) excepted in such certifications and (ii) that as of the date hereof
we have not received any notification from any of our Member Organizations to
the effect that the statements made by such Member Organizations with respect to
any portion of the part submitted herewith for exchange (or, if relevant,
exercise of any rights or collection of any interest) are no longer true and
cannot be relied upon as of the date hereof.
--------------------
a Unless Xxxxxx Guaranty Trust Company of New York, London Branch is
otherwise informed by the Agent, the long form certificate set out in the
Operating Procedures will be deemed to meet the requirements of this
sentence.
F-1
We understand that this certification is required in connection with certain
securities laws of the United States. In connection therewith, if administrative
or legal proceedings are commenced or threatened in connection with which this
certification is or would be relevant, we irrevocably authorize you to produce
this certification to any interested party in such proceedings. This certificate
and the statements contained herein are made for your benefit and the benefit of
the Company and the Initial Purchasers.
Dated: ___________, ____
Yours faithfully,
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, as operator of the Euro-
clear System
or
[CEDEL BANK, SOCIETE ANONYME]
By:
---------------------------------
F-2
EXHIBIT G
[FORM OF CERTIFICATION TO BE GIVEN BY
TRANSFEREE OF BENEFICIAL INTEREST IN A
TEMPORARY REGULATION S GLOBAL SECURITY]
TRANSFEREE SECURITIES CERTIFICATION
LODESTAR HOLDINGS, INC.
11 1/2% Senior Notes due 2005
CUSIP No._________
Reference is hereby made to the Indenture, dated as of May 15, 1998 (the
"Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation, as
issuer, the Guarantors named therein, and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
For purposes of acquiring a beneficial interest in the Temporary Regulation S
Global Security, the undersigned certifies that it is not a U.S. person as
defined by Regulation S under the Securities Act of 1933, as amended.
We undertake to advise you promptly by tested telex on or prior to the date on
which you intend to submit your certification relating to the Securities held by
you in which we intend to acquire a beneficial interest in accordance with your
operating procedures if any applicable statement herein is not correct on such
date, and in the absence of any such notification it may be assumed that this
certification applies as of such date.
We understand that this certificate is required in connection with certain
securities laws of the United States. In connection therewith, if administrative
or legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate to any interested party in such proceeding. This certificate
and the statements contained herein are made for your benefit and the benefit of
the Company and the Initial Purchasers.
Dated: _____________, ____
By:
----------------------------------
As, or as agent for, the bene-
ficial acquiror of the Securi-
ties to which this certificate
relates.
G-1
EXHIBIT H
FORM OF CERTIFICATION FOR TRANSFER OR
EXCHANGE OF RESTRICTED GLOBAL SECURITY
TO TEMPORARY REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This letter relates to U.S. $_____________ aggregate principal amount
of Securities which are held in the form of the Restricted Global Security
(CUSIP No. ) with the Depository in the name of [insert name of transferor] (the
"Transferor"). The Transferor has requested a transfer of such beneficial
interest in the Securities to a person who will take delivery thereof in the
form of an equal aggregate principal amount of Securities evidenced by the
Temporary Regulation S Global Security (CUSIP No. ) to be held with the
Depository in the name of [Euroclear] [Cedel Bank, societe anonyme].
In connection with such request and in respect of such Securities, the
Transferor does hereby certify that such transfer has been effected in
accordance with the transfer restrictions set forth in the Securities and
pursuant to and in accordance with Regulation S under the Securities Act of
1933, as amended (the "Securities Act"), and accordingly the Transferor does
hereby certify that:
(1) the offer of the Securities was not made to a person in the United
States;
[(2) at the time the buy order was originated, the transferee was
outside the United States or the Transferor
H-1
and any person acting on its behalf reasonably believed that the transferee
was outside the United States;]
[(2) the transaction was executed in, on or through the facilities of
a designated offshore securities market and neither the Transferor nor any
person acting on our behalf knows that the transaction was pre-arranged
with a buyer in the United States;]2
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903 (b) or 904(b) of Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) upon completion of the transaction, the beneficial interest being
transferred as described above is to be held with the Depository in the
name of [Euroclear] [Cedel Bank, societe anonyme].
We understand that this certificate is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Company and the Initial Purchasers.
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
---------------------
a Insert one of these two provisions, which come from the definition of
"offshore transaction" in Regulation S.
H-2
Dated:
-------------------
cc: Lodestar Holdings, Inc.
H-3
EXHIBIT I
FORM OF CERTIFICATION FOR TRANSFER OR EXCHANGE OF
RESTRICTED GLOBAL SECURITY TO
PERMANENT REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This letter relates to U.S.$____________ aggregate principal amount of
Securities which are held in the form of the Restricted Global Security (CUSIP
No. ) with the Depository in the name of [insert name of transferor] (the
"Transferor"). The Transferor has requested a transfer of such beneficial
interest in the Securities to a person who will take delivery thereof in the
form of an equal aggregate principal amount of Securities evidenced by the
Permanent Regulation S Global Security (CUSIP No. ).
In connection with such request, and in respect of such Securities,
the Transferor does hereby certify that such transfer has been effected in
accordance with the transfer restrictions set forth in the Securities and,
(1) with respect to transfers made in reliance on Regulation S under
the Securities Act of 1933, as amended (the "Securities Act"), the
Transferor does hereby certify that:
(A) the offer of the Securities was not made to a person in the United
States;
[(B) (at the time the buy order was originated, the transferee was
outside the United States or the Transferor
I-1
and any person acting on its behalf reasonably believed that the transferee
was outside the United States;]
[(C) the transaction was executed in, on or through the facilities of
a designated offshore securities market and neither the Transferor nor any
person acting on our behalf knows that the transaction was pre-arranged
with a buyer in the United States;]3
(D) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable; and
(E) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(2) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that the Securities are being
transferred in a transaction permitted by Rule 144 under the Securities Act.
We understand that this certificate is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Company and the Initial Purchasers.
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
----------------------
a Insert one of these two provisions, which come from the definition of
"offshore transactions" in Regulation S.
I-2
Dated:
-----------------
cc: Lodestar Holdings, Inc.
I-3
EXHIBIT J
FORM OF CERTIFICATION FOR TRANSFER OR EXCHANGE OF
TEMPORARY REGULATION S GLOBAL SECURITY
OR PERMANENT REGULATION S GLOBAL SECURITY TO
RESTRICTED GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This letter relates to U.S.$ _________ principal amount of Securities
which are evidenced by an aggregate [Temporary Regulation S Global Security
(CUSIP No. ] [Permanent Regulation S Global Security (CUSIP No. ] and held with
the Depository through [Euroclear] [Cedel] (Common Code ______ ) in the name of
[insert name of transferor] (the "Transferor"). The Transferor has requested a
transfer of such beneficial interest in Securities to a person that will take
delivery thereof in the form of an equal principal amount of Securities
evidenced by a Restricted Global Security of the same series and of like tenor
as the Securities (CUSIP No. ).
In connection with such request and in respect of such Securities, the
Transferor does hereby certify that such transfer is being effected pursuant to
and in accordance with Rule 144A under the Securities Act and, accordingly, the
Transferor does hereby further certify that the Securities are being transferred
to a person that the Transferor reasonably believes is purchasing the Securities
for its own account, or for one or more accounts with respect to which such
person exercises sole investment discretion, and such person and each such
account is a "qualified institutional buyer" within the meaning of Rule 144A, in
each case in a transaction meeting the requirements of
J-1
Rule 144A and in accordance with any applicable securities laws of any state of
the United States.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchaser.
[Insert Name of Transferor]
By:
------------------------------
Name:
Title:
Dated:
-------------------
cc: Lodestar Holdings, Inc.
J-2
EXHIBIT K-1
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL RESTRICTED SECURITY TO
RESTRICTED GLOBAL SECURITY
State Street Bank and Trust Company
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This letter relates to $ _________ principal amount of Restricted
Securities held in definitive form (CUSIP No. ) by [insert name of transferor]
(the "Transferor"). The Transferor has requested an exchange or transfer of such
Securities.
In connection with such request and in respect of such Securities, the
Transferor does hereby certify that (i) such Securities are owned by the
Transferor and are being exchanged without transfer or (ii) such transfer has
been effected pursuant to and in accordance with Rule 144A or Rule 144 under the
United States Securities Act of 1933, as amended (the "Securities Act") and
accordingly the Transferor does hereby further certify that:
(1) if the transfer has been effected pursuant to Rule 144A:
(A) the Securities are being transferred to a person that the
Transferor reasonably believes is purchasing the Securities for its
own account, or for one or more accounts with respect to which such
person exercises sole investment discretion;
K-1-1
(B) such person and each such account is a "qualified
institutional buyer" within the meaning of Rule 144A; and
(C) the Securities have been transferred in a transaction meeting
the requirements of Rule 144A and in accordance with any applicable
securities laws of any state of the United States; or
(2) if the transfer has been effected pursuant to Rule 144:
(A) more than two years has elapsed since the date of the closing
of the initial placement of the Securities pursuant to the Purchase
Agreement; and
(B) the Securities have been transferred in a transaction
permitted by Rule 144 and made in accordance with any applicable
securities laws of any state of the United States.
We understand that this certificate is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Company and the Initial Purchasers.
Dated: _____________, ____
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
cc: Lodestar Holdings, Inc.
K-1-2
EXHIBIT K-2
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL RESTRICTED SECURITY TO
PERMANENT REGULATION S GLOBAL SECURITY
OR TEMPORARY REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This letter relates to $ _________ principal amount of Restricted
Securities held in definitive form (CUSIP No. ) by [insert name of transferor]
(the "Transferor"). The Transferor has requested an exchange or transfer of such
Securities.
In connection with such request and in respect of such Securities, the
Transferor does hereby certify that (i) such Securities are owned by the
Transferor and are being exchanged without transfer or (ii) such transfer has
been effected pursuant to and in accordance with (a) Rule 903 or Rule 904 under
the Securities Act of 1933, as amended (the "Act"), or (b) Rule 144 under the
Act, and accordingly the Transferor does hereby further certify that:
(1) if the transfer has been effected pursuant to Rule 903 or Rule
904:
(A) the offer of the Securities was not made to a person in the United
States;
(B) either;
(i) at the time the buy order was originated, the transferee was
outside the United States or the
K-2-1
Transferor and any person acting on its behalf reasonably believed
that the transferee was outside the United States, or
(ii) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither the
Transferor nor any person acting on its behalf knows that the
transaction was pre-arranged with a buyer in the United States;
(C) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b) of Regulation S, as applicable;
(D) the transaction is not part of a plan or scheme to evade the
registration requirements of the Act; and
(E) if such transfer is to occur during the Restricted Period, upon
completion of the transaction, the beneficial interest being transferred as
described above was held with the Depository through [Euroclear] [CEDEL];
or
(2) if the transfer has been effected pursuant to Rule 144:
(A) more than two years has elapsed since the date of the closing of
the initial placement of the Securities pursuant to the Purchase Agreement;
and
(B) the Securities have been transferred in a transaction permitted by
Rule 144 and made in accordance with any applicable securities laws of any
state of the United States.
We understand that this certificate is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such
K-2-2
proceeding. This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchasers.
Dated: ____________, ____
[Insert Name of Transferor]
By:
-----------------------------
Name:
Title:
cc: Lodestar Holdings, Inc.
K-2-3
EXHIBIT L-1
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL PERMANENT REGULATION S
SECURITY TO RESTRICTED GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, and State Street Bank and Trust Company, as trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to $ ___________ principal amount of Restricted
Securities held in definitive form (CUSIP No. ) by [insert name of transferor]
(the "Transferor"). The Transferor has requested an exchange or transfer of such
Securities.
In connection with such request and in respect of such Securities, the
Transferor does hereby certify that (i) such Securities are owned by the
Transferor and are being exchanged without transfer or (ii) such transfer has
been effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended, and accordingly the Transferor does
hereby further certify that the Securities are being transferred to a person
that the Transferor reasonably believes is purchasing the Securities for its own
account, or for one or more accounts with respect to which such person exercises
sole investment discretion, and such person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in each case in
a transaction meeting the requirements of Rule 144A and in accordance with any
applicable securities laws of any state of the United States.
We understand that this certificate is required in connection with
certain securities laws of the United States.
L-1-1
In connection therewith, if administrative or legal proceedings are commenced or
threatened in connection with which this certificate is or would be relevant, we
irrevocably authorize you to produce this certificate to any interested party in
such proceeding. This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Initial Purchasers.
Dated: _______________, ____
[Insert Name of Transferor]
By:
------------------------------
Name:
Title:
cc: Lodestar Holdings, Inc.
X-0-0
XXXXXXX X-0
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL PERMANENT REGULATION S
SECURITY TO PERMANENT REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Xxxxxxx Square
225 Asylum, 00xx Xxxxx
Xxxxxxxx, XX 00000
Attention: Corporate Trust Administration
Re: Lodestar Holdings, Inc.
11 1/2% Senior Notes due 2005
Reference is hereby made to the Indenture, dated as of May 15, 1998
(the "Indenture"), by and among Lodestar Holdings, Inc., a Delaware corporation,
as issuer, the Guarantors named therein and State Street Bank and Trust Company,
as trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Indenture.
This letter relates to $______________ principal amount of Restricted
Securities held in definitive form (CUSIP No. ) by __________ [insert name of
transferor] (the "Transferor"). The Transferor has requested an exchange or
transfer of such Securities.
In connection with such request and in respect of such Securities, the
Transferor does hereby certify that (i) such Securities are owned by the
Transferor and are being exchanged without transfer or (ii) such transfer has
been effected pursuant to and in accordance with (a) Rule 903 or Rule 904 under
the Securities Act of 1933, as amended (the "Act"), or (b) Rule 144 under the
Act, and accordingly the Transferor does hereby further certify that:
(1) if the transfer has been effected pursuant to Rule 903 or Rule
904:
(A) the offer of the Securities was not made to a person in the
United States;
(B) either;
L-2-1
(i) at the time the buy order was originated, the transferee
was outside the United States or the Transferor and any person
acting on its behalf reasonably believed that the transferee was
outside the United States, or
(ii) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither
the Transferor nor any person acting on its behalf knows that the
transaction was pre-arranged with a buyer in the United States;
(C) no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or 904 (b) of Regulation S, as
applicable;
(D) the transaction is not part of a plan or scheme to evade the
registration requirements of the Act; and
(E) if such transfer is to occur during the Restricted Period,
upon completion of the transaction, the beneficial interest being
transferred as described above was held with the Depository through
[Euroclear] [CEDEL]; or
(2) if the transfer has been effected pursuant to Rule 144:
(A) more than two years has elapsed since the date of the closing
of the initial placement of the Securities pursuant to the Purchase
Agreement; and
(B) the Securities have been transferred in a transaction
permitted by Rule 144 and made in accordance with any applicable
securities laws of any state of the United States.
We understand that this certificate is required in connection with
certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained
L-2-2
herein are made for your benefit and the benefit of the Company and the Initial
Purchasers.
Dated: ______________, ____
[Insert Name of Transferor]
By:
------------------------------
Name:
Title:
cc: Lodestar Holdings, Inc.
L-2-3
EXHIBIT M
GUARANTEE
For value received, the undersigned hereby unconditionally guarantees,
as principal obligor and not only as a surety, to the Holder of this Security
the cash payments in United States dollars of principal of, premium, if any, and
interest on this Security in the amounts and at the times when due and interest
on the overdue principal, premium, if any, and interest, if any, of this
Security, if lawful, and the payment or performance of all other obligations of
the Company under the Indenture (as defined below) or the Securities, to the
Holder of this Security and the Trustee, all in accordance with and subject to
the terms and limitations of this Security, Article Eleven of the Indenture and
this Guarantee. This Guarantee will become effective in accordance with Article
Eleven of the Indenture and its terms shall be evidenced therein. The validity
and enforceability of any Guarantee shall not be affected by the fact that it is
not affixed to any particular Security. Capitalized terms used but not defined
herein shall have the meanings ascribed to them in the Indenture dated as of May
15, 1998, by and among Lodestar Holdings, Inc., a Delaware corporation, as
issuer, the Guarantors named therein and State Street Bank and Trust Company, as
trustee, as amended or supplemented (the "Indenture").
The obligations of the undersigned to the Holders of Securities and to
the Trustee pursuant to this Guarantee and the Indenture are expressly set forth
in Article Eleven of the Indenture and reference is hereby made to the Indenture
for the precise terms of the Guarantee and all of the other provisions of the
Indenture to which this Guarantee relates.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF
CONFLICTS OF LAW. Each Guarantor hereby agrees to submit to the jurisdiction of
any federal or state court in the Borough of Manhattan of the City of New York
for purposes of any legal suit, action or proceeding against it arising out of
or related to this Indenture, the Securities and the Guarantees (a "Related
Proceeding"). The Company hereby consents to the jurisdiction of each such court
for the purposes of any Related Proceeding, and irrevocably waives, to the
fullest extent it may effectively do so, any objection to the laying of venue of
any Related Proceeding in any such court and the defense of an inconvenient
forum to the maintenance of any Related Proceedings in any such court.
M-1
This Guarantee is subject to release upon the terms set forth in the
Indenture.
M-2
IN WITNESS WHEREOF, each Guarantor has caused its Guarantee to be
duly executed.
Date:
-----------------
LODESTAR ENERGY, INC.
as Guarantor
By:
------------------------------
Name:
Title:
EASTERN RESOURCES, INC.,
as Guarantor
By:
------------------------------
Name:
Title:
INDUSTRIAL FUELS MINERALS COMPANY,
as Guarantor
By:
------------------------------
Name:
Title:
M-3
