EXHIBIT 4.10
DOLE FOOD COMPANY, INC.,
as Issuer,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Trustee
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SECOND SUPPLEMENTAL INDENTURE
Dated as of March 28, 2003
Supplementing the Trust Indenture Dated as of July 15, 1993
---------------
Providing, among other things, for
the succession of Wells Fargo Bank, National Association to J.P. Morgan Trust
Company as Trustee under such Trust Indenture
and
Amendment to the terms of 7-7/8% Debentures due July 15, 2013 and
7-1/4% Senior Notes due 2009
---------------------------------------------------------------
THIS SECOND SUPPLEMENTAL INDENTURE, dated as of March 28, 2003, between
DOLE FOOD COMPANY, INC., a corporation duly incorporated and existing under the
laws of the State of Delaware (the "Company"), having its principal office at
One Dole Drive, Westlake Village, California 91362, and WELLS FARGO BANK,
NATIONAL ASSOCIATION, a national banking association, having an office at 707
Wilshire Boulevard, 17th Floor, Los Angeles, California 90017, who is hereby
appointed successor Trustee to J.P. Morgan Trust Company, National Association
(formerly known as the Chase Manhattan Bank and Trust Company, National
Association, and formerly known as Chemical Trust Company of California, the
"Retiring Trustee") (said Wells Fargo Bank, National Association being
hereinafter sometimes called the "New Trustee"), as Trustee under the Indenture,
dated as of July 15, 1993 (the "Original Indenture"), which Original Indenture
was executed and delivered by the Company to Chemical Trust Company of
California, as Trustee, to secure the payment of senior debt securities issued
or to be issued under and in accordance with the provisions of the Original
Indenture, reference to which Original Indenture is hereby made, this instrument
(hereinafter called the " Second Supplemental Indenture") being supplemental
thereto;
Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed thereto in the Original Indenture;
RECITALS
WHEREAS, the Company has heretofore executed and delivered to the
Retiring Trustee the Original Indenture (together with the Officers' Certificate
under Sections 102, 201, 301 and 303 of the Original Indenture, dated as of
October 6, 1998 (the "1998 Officers' Certificate"), the Officers' Certificate
under Section 201, 301 and 303 of the Original Indenture dated as of August 3,
1993 (the "1993 Officers' Certificate"), the First Supplemental Indenture, dated
as of April 30, 2002 (the "First Supplemental Indenture") and this Second
Supplemental Indenture, the "Indenture"), providing for the issuance by the
Company from time to time of its unsecured debt securities to be issued in one
or more series (in the Original Indenture and herein called the "Securities");
WHEREAS, pursuant to the 1993 Officers' Certificate, the Company issued
$225,000,000 aggregate principal amount of its 6-3/4% Notes due July 15, 2000
(the "2000 Notes") and $175,000,000 aggregate principal amount of its 7-7/8%
Debentures due 2013 (the "2013 Notes");
WHEREAS, pursuant to the 1998 Officers' Certificate, the Company issued
$300,000,000 aggregate principal amount of its 6-3/8% Notes due 2005 (the "2005
Notes");
WHEREAS, pursuant to the First Supplemental Indenture, the Company
issued $400,000,000 aggregate principal amount of its 7-1/4% Senior Notes due
2009 (the "2009 Notes");
WHEREAS, as of the date of this Second Supplemental Indenture, there
are no outstanding 2000 Notes, $300,000,000 aggregate principal amount of 2005
Notes outstanding, $400,000,000 aggregate principal amount of 2009 Notes
outstanding and $155,000,000 aggregate principal amount of 2013 Notes
outstanding;
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WHEREAS, as permitted by Section 610 of the Original Indenture, the
Company desires to remove the Retiring Trustee as Trustee under the Original
Indenture and to appoint the New Trustee as successor Trustee under the Original
Indenture, subject to the conditions of Article Six of the Original Indenture,
effective as of the opening of business on March 28, 2003, and said New Trustee
desires to accept such appointment, effective as of the opening of business on
March 28, 2003, in each case, pursuant to this Second Supplemental Indenture;
WHEREAS, pursuant to that certain Agreement of Removal, Appointment and
Acceptance, dated as of March 28, 2003 (the "Removal Agreement"), the Company
and the Retiring Trustee agreed to the removal of the Retiring Trustee as
Trustee under the Original Indenture and the Company and the New Trustee agreed
to the appointment of the New Trustee as Trustee under the Original Indenture;
WHEREAS, pursuant to that certain Indenture, dated as of March 28, 2003
(the "New Senior Notes Indenture"), the Company is issuing $475,000,000
aggregate principal amount of its 8-7/8% Senior Notes due 2011 (the "New Senior
Notes");
WHEREAS, in connection with certain other transactions occurring on the
date of this Second Supplemental Indenture, the Company has agreed to amend the
terms of the Original Indenture governing the terms of the 2009 Notes and the
2013 Notes (collectively, the "Existing Notes") to add to the covenants of the
Company under the Original Indenture, to increase the interest rates payable on
such Existing Notes, to cause certain of its subsidiaries to guarantee the
Existing Notes on a senior subordinated basis and to add additional Events of
Default (as defined in the Original Indenture);
WHEREAS, Section 301 of the Original Indenture provides for various
matters with respect to any series of Securities issued under the Original
Indenture to be established in an indenture supplemental to the Original
Indenture;
WHEREAS, Section 901 of the Original Indenture provides for the Company
and the Trustee to evidence and provide for the acceptance of appointment
thereunder by a successor Trustee with respect to the Securities of one or more
series issued under the Original Indenture;
WHEREAS, Section 901 of the Original Indenture provides that certain
changes may be made to the Original Indenture with respect to any series of
Securities issued under the Original Indenture without the consent of the
holders of such Securities, including the addition of additional covenants of
the Company and the increase of interest rates payable on such Securities for
the benefit of the holders of any or all series of Securities issued under the
Original Indenture;
WHEREAS, Section 901 of the Original Indenture provides that certain
changes may be made to the Original Indenture with respect to any series of
Securities issued under the Original Indenture without the consent of the
holders of such Securities, including the addition of additional Events of
Default (as defined in the Original Indenture);
WHEREAS, as permitted by Section 901 of the Original Indenture, the
Company, in the exercise of the power and authority conferred upon and reserved
to it under the provisions of the Original Indenture, has duly determined to
make, execute and deliver to the New Trustee this
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Second Supplemental Indenture to the Original Indenture in order to add to the
covenants of the Company for the benefit of the holders of the 2009 Notes and
the 2013 Debentures;
WHEREAS, as permitted by Section 901 of the Original Indenture, the
Company, in the exercise of the power and authority conferred upon and reserved
to it under the provisions of the Original Indenture, has duly determined to
make, execute and deliver to the Trustee this Second Supplemental Indenture to
the Original Indenture in order to increase the interest rate payable on and
after the date hereof with respect to the 2009 Notes from 7-1/4% per annum to
8.625% per annum and to increase the interest rate payable on and after the date
hereof with respect to the 2013 Notes from 7-7/8% per annum to 8.75% per annum;
WHEREAS, as permitted by Section 901 of the Original Indenture, the
Company, in the exercise of the power and authority conferred upon and reserved
to it under the provisions of the Original Indenture, has duly determined to
make, execute and deliver to the Trustee this Second Supplemental Indenture to
the Original Indenture in order to provide for the guarantee of the 2009 Notes
and the 2013 Debentures by certain of its domestic subsidiaries; and
WHEREAS, as permitted by Section 901 of the Original Indenture, the
Company, in the exercise of the power and authority conferred upon and reserved
to it under the provisions of the Original Indenture, has duly determined to
make, execute and deliver to the Trustee this Second Supplemental Indenture to
the Original Indenture in order to add additional Events of Default for the
Existing Notes; and
WHEREAS, the execution and delivery by the Company of this Second
Supplemental Indenture have been duly authorized by the Board of Directors of
the Company by appropriate Board Resolutions.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That the Company, pursuant to the Removal Agreement and pursuant to
Section 610 of the Original Indenture, and by order of its Board of Directors,
hereby removes the Retiring Trustee as Trustee under the Original Indenture (and
will furnish to said Retiring Trustee a manually signed original of this Second
Supplemental Indenture as an instrument of such removal) effective as of the
opening of business on March 28, 2003;
That, pursuant to Section 610 of the Original Indenture, and by order
of its Board of Directors, the Company hereby appoints the New Trustee as
successor Trustee under the Original Indenture, subject to the conditions of
Article Six thereof, effective as of the opening of business on March 28, 2003;
That the undersigned New Trustee hereby accepts its appointment by the
Company as successor Trustee under the Original Indenture (and, pursuant to
Section 611 of the Original Indenture, will furnish to said Retiring Trustee and
the Company a manually signed original of this Second Supplemental Indenture as
an instrument of such acceptance) effective as of the opening of business on
March 28, 2003;
That the Company will proceed with the delivery of the notice of the
aforesaid removal and the notice of the aforesaid appointment, as required, by
Section 610 and in the manner
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prescribed by Section 106 of the Original Indenture, in substantially the form
provided in Exhibit A attached hereto.
The Company further covenants and agrees to and with the New Trustee
and its successors in said trust under the Original Indenture, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101 Definitions. Each capitalized term that is used
herein and is defined in the Indenture shall have the meaning specified in the
Indenture unless such term is otherwise defined herein. The definitions below
shall only apply for the purposes of the new provisions added to the Indenture.
"Acquired Indebtedness" means Indebtedness of a Person or any
of its Subsidiaries existing at the time such Person becomes a
Restricted Subsidiary of the Company or at the time it merges
or consolidates with or into the Company or any of its
Restricted Subsidiaries or assumed in connection with the
acquisition of assets from such Person and in each case not
incurred by such Person in connection with, or in anticipation
or contemplation of, such Person becoming a Restricted
Subsidiary of the Company or such acquisition, merger or
consolidation.
"Affiliate" means, with respect to any specified Person, any
other Person who directly or indirectly through one or more
intermediaries controls, or is controlled by, or is under
common control with, such specified Person. The term "control"
means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies
of a Person, whether through the ownership of voting
securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative of
the foregoing.
"Asset Acquisition" means (1) an Investment by the Company or
any Restricted Subsidiary of the Company in any other Person
pursuant to which such Person shall become a Restricted
Subsidiary of the Company or any Restricted Subsidiary of the
Company, or shall be merged with or into the Company or any
Restricted Subsidiary of the Company, or (2) the acquisition
by the Company or any Restricted Subsidiary of the Company of
the assets of any Person (other than a Restricted Subsidiary
of the Company) which constitutes all or substantially all of
the assets of such Person or comprises any division or line of
business of such Person or any other properties or assets of
such Person other than in the ordinary course of business.
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"Asset Sale" means any direct or indirect sale, issuance,
conveyance, transfer, lease (other than operating leases
entered into in the ordinary course of business), assignment
or other transfer for value by the Company or any of its
Restricted Subsidiaries (including any Sale and Leaseback
Transaction) to any Person other than the Company, a Guarantor
or a Wholly Owned Restricted Subsidiary of the Company of: (1)
any Capital Stock of any Restricted Subsidiary of the Company;
or (2) any other property or assets of the Company or any
Restricted Subsidiary of the Company other than in the
ordinary course of business; provided, however, that none of
the following shall be considered an Asset Sale: (a) a
transaction or series of related transactions for which the
Company or its Restricted Subsidiaries receive aggregate
consideration of less than $5.0 million; (b) the sale, lease,
conveyance, disposition or other transfer of all or
substantially all of the assets of the Company as permitted
under Article Eight; (c) the grant of Liens not prohibited by
this Indenture; (d) any Restricted Payment permitted by
Section 1012 or that constitutes a Permitted Investment; (e)
the sale or discount, in each case without recourse, of
accounts receivable arising in the ordinary course of
business, but only in connection with the compromise or
collection thereof; and (f) disposals or replacements of
obsolete, worn out, uneconomical or surplus property or
equipment.
"Asset Swap" means the execution of a definitive agreement,
subject only to customary closing conditions that the Company
in good faith believes will be satisfied, for a substantially
concurrent purchase and sale, or exchange, of assets (of a
kind used or usable by the Company and its Restricted
Subsidiaries in their business as it exists on the date
thereof, or in businesses that are the same as such business
of the Company and its Restricted Subsidiaries on the date
thereof or similar or reasonably related thereto) between the
Company or any of its Restricted Subsidiaries and another
Person or group of affiliated Persons; provided, however, that
any amendment to or waiver of any closing condition that
individually or in the aggregate is material to the Asset Swap
shall be deemed to be a new Asset Swap.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors.
"Board of Directors" means, as to any Person, the board of
directors (or similar governing body) of such Person or any
duly authorized committee thereof.
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"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.
"Business Day" means any day other than a Saturday, a Sunday
or a day on which banking institutions in the City of New York
or at a place of payment are authorized by law, regulation or
executive order to remain closed. If a payment date is not a
Business Day at a place of payment, payment may be made at
that place on the next succeeding day that is a Business Day,
and no interest shall accrue for the intervening period.
"Capital Call Agreement" means the Capital Call Agreement to
be dated on or about the Issue Date by and among David H.
Murdock, individually, and as trustee for the David H. Murdock
Living Trust, Holdings and Deutsche Bank AG New York Branch,
as administrative agent.
"Capital Stock" means:
(1) with respect to any Person that is a corporation, any
and all shares, interests, participations or other equivalents
(however designated and whether or not voting) of corporate
stock, including each class of Common Stock and Preferred
Stock of such Person, and all options, warrants or other
rights to purchase or acquire any of the foregoing; and
(2) with respect to any Person that is not a corporation,
any and all partnership, membership or other equity interests
of such Person, and all options, warrants or other rights to
purchase or acquire any of the foregoing.
"Capitalized Lease Obligation" means, as to any Person, the
obligations of such Person under a lease that are required to
be classified and accounted for as capital lease obligations
under GAAP and, for purposes of this definition, the amount of
such obligations at any date shall be the capitalized amount
of such obligations at such date, determined in accordance
with GAAP.
"Cash Equivalents" means:
(1) U.S. dollars, pounds sterling, Euros or, in the case
of any Foreign Restricted Subsidiary, such local currencies
held by it from time to time in the ordinary course of
business;
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(2) securities issued by, or unconditionally guaranteed
by, the United States Government, the governments of Canada,
Japan, Sweden, Switzerland or the member states of the United
Kingdom or the European Union or issued by any agency thereof
and backed by the full faith and credit of the United States,
Canada, Japan, Sweden, Switzerland or the member states of the
United Kingdom or the European Union, in each case maturing
within one year from the date of acquisition thereof;
(3) securities issued by any state of the United States
of America or any political subdivision of any such state or
any public instrumentality thereof maturing within one year
from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable
from either Standard & Poor's Ratings Group ("S&P") or Moody's
Investors Service, Inc. ("Moody's");
(4) commercial paper maturing no more than one year from
the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 from S&P or at least P-1 from
Moody's;
(5) certificates of deposit or bankers' acceptances
maturing within one year from the date of acquisition thereof
issued by any bank organized under the laws of the United
States of America or any state thereof or the District of
Columbia or any U.S. branch of a foreign bank having at the
date of acquisition thereof combined capital and surplus of
not less than $250.0 million or by a commercial bank organized
under the laws of a country recognized by the United States
which has a combined capital and surplus of not less than
$250.0 million (or the foreign currency equivalent thereof);
or money market funds sponsored by a registered broker dealer
or mutual fund distributor;
(6) eurodollar time deposits;
(7) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in
clause (1) or (2) above entered into with any bank meeting the
qualifications specified in clause (5) above; and
(8) investments in money market funds which invest
substantially all their assets in securities of the types
described in clauses (1) through (7) above;
provided that for purposes of the subordination provisions,
the term "Cash Equivalents" shall not include obligations of
the type referred to in clause (7).
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"Change of Control" means the occurrence of one or more of the
following events:
(1) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or
substantially all of the assets of the Company or Holdings to
any Person or group of related Persons for purposes of Section
13(d) of the Exchange Act (a "Group"), together with any
Affiliates thereof (whether or not otherwise in compliance
with the provisions of this Indenture), other than to the
Permitted Holders;
(2) the approval by the holders of Capital Stock of the
Company or Holdings, as the case may be, of any plan or
proposal for the liquidation or dissolution of the Company or
Holdings, as the case may be (whether or not otherwise in
compliance with the provisions of this Indenture);
(3) any Person or Group (other than the Permitted Holders
and any entity formed by the Permitted Holders for the purpose
of owning Capital Stock of the Company) shall become the
owner, directly or indirectly, beneficially or of record, of
shares representing more than 50% of the aggregate ordinary
voting power represented by the issued and outstanding Capital
Stock of the Company or Holdings; or
(4) the replacement of a majority of the Board of
Directors of the Company or Holdings over a two-year period
from the directors who constituted the Board of Directors of
the Company or Holdings, as the case may be, at the beginning
of such period, and such replacement shall not have been
approved by a vote of either the holders of a majority of the
shares of Common Stock of Holdings (so long as the Permitted
Holders hold a majority of the Common Stock of Holdings) or at
least a majority of the Board of Directors of the Company or
Holdings, as the case may be, then still in office who either
were members of such Board of Directors at the beginning of
such period or whose election as a member of such Board of
Directors was previously so approved.
"Commodities Agreements" means commodity agreements, hedging
agreements and other similar agreements or arrangements
designed to protect the Company or any Restricted Subsidiary
of the Company against price fluctuations of commodities
(e.g., fuel) used in their respective businesses.
"Common Stock" of any Person means any and all shares,
interests or other participations in, and other equivalents
(however designated and whether voting or non-voting) of, such
Person's
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common stock, whether outstanding on the Issue Date or issued
after the Issue Date, and includes, without limitation, all
series and classes of such common stock.
"Company" means Dole Food Company, Inc., a Delaware
corporation, until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and
thereafter means such successor Person.
"Consolidated EBITDA" means, with respect to any Person, for
any period, the sum (without duplication) of:
(1) Consolidated Net Income; and
(2) to the extent Consolidated Net Income has been
reduced thereby:
(a) all income taxes of such Person and its Restricted
Subsidiaries paid or accrued in accordance with GAAP for such
period;
(b) Consolidated Interest Expense; and
(c) Consolidated Non-cash Charges less any non-cash items
increasing Consolidated Net Income for such period,
all as determined on a consolidated basis for such Person and
its Restricted Subsidiaries 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 prior to the date of the transaction giving
rise to the need to calculate the Consolidated Fixed Charge
Coverage Ratio for which financial statements are available
(the "Transaction Date") to Consolidated Fixed Charges of such
Person for the Four Quarter Period. In addition to and without
limitation of the foregoing, for purposes of this definition,
"Consolidated EBITDA" and "Consolidated Fixed Charges" shall
be calculated after giving effect on a pro forma basis for the
period of such calculation to:
(1) the incurrence or repayment of any Indebtedness of
such Person or any of its Restricted Subsidiaries (and the
application of the proceeds thereof) giving rise to the need
to make such calculation and any incurrence or repayment of
other Indebtedness (and the application of the proceeds
thereof), other than the incurrence or repayment of
Indebtedness in the ordinary course of business for working
capital purposes pursuant to working capital
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facilities, occurring during the Four Quarter Period or at any
time subsequent to the last day of the Four Quarter Period and
on or prior to the Transaction Date, as if such incurrence or
repayment, as the case may be (and the application of the
proceeds thereof), occurred on the first day of the Four
Quarter Period; and
(2) any Asset Sales or other disposition or Asset
Acquisitions (including, without limitation, any Asset
Acquisition giving rise to the need to make such calculation
as a result of such Person or one of its Restricted
Subsidiaries (including any Person who becomes a Restricted
Subsidiary as a result of the Asset Acquisition) incurring,
assuming or otherwise being liable for Acquired Indebtedness
and also including any Consolidated EBITDA attributable to the
assets which are the subject of the Asset Acquisition or Asset
Sale or other disposition during the Four Quarter Period)
occurring during the Four Quarter Period or at any time
subsequent to the last day of the Four Quarter Period and on
or prior to the Transaction Date, as if such Asset Sale or
other disposition or Asset Acquisition (including the
incurrence, assumption or liability for any such Acquired
Indebtedness) occurred on the first day of the Four Quarter
Period.
For purposes of this definition, whenever pro forma effect is
to be given to an Asset Acquisition and the amount of income
or earnings relating thereto, the pro forma calculations shall
be determined in good faith by a responsible financial or
accounting Officer of the Company and shall comply with the
requirements of Rule 11-02 of Regulation S-X promulgated by
the Commission, except that such pro forma calculations may
include operating expense reductions for such period resulting
from the acquisition which is being given pro forma effect
that have been realized or for which the steps necessary for
realization have been taken or are reasonably expected to be
taken within six months following any such Asset Acquisition,
including, but not limited to, the execution or termination of
any contracts, the termination of any personnel or the closing
(or approval by the Board of Directors of the Company of any
closing) of any facility, as applicable, provided that, in
either case, such adjustments are set forth in an Officers'
Certificate signed by the Company's chief financial officer
and another Officer which states (i) the amount of such
adjustment or adjustments, (ii) that such adjustment or
adjustments are based on the reasonable good faith beliefs of
the Officers executing such Officers' Certificate at the time
of such execution and (iii) that any related incurrence of
Indebtedness is permitted pursuant to this Indenture.
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If such Person or any of its Restricted Subsidiaries directly
or indirectly guarantees Indebtedness of a third Person, the
preceding sentence shall give effect to the incurrence of such
guaranteed Indebtedness as if such Person or any Restricted
Subsidiary of such Person had directly incurred or otherwise
assumed such guaranteed Indebtedness.
Furthermore, in calculating "Consolidated Fixed Charges" for
purposes of determining the denominator (but not the
numerator) of this "Consolidated Fixed Charge Coverage Ratio":
(1) interest on outstanding Indebtedness determined on a
fluctuating basis as of the Transaction Date and which will
continue to be so determined thereafter shall be deemed to
have accrued at a fixed rate per annum equal to the rate of
interest on such Indebtedness in effect on the Transaction
Date; 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
Swap 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, without duplication, of:
(1) Consolidated Interest Expense (excluding the
amortization or write-off of deferred financing costs); plus
(2) the product of (x) the amount of all dividend
payments on any series of Preferred Stock of such Person and,
to the extent permitted under this Indenture, its Restricted
Subsidiaries (other than dividends paid in Qualified Capital
Stock) paid, accrued or scheduled to be paid or accrued 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 and local income tax
rate of such Person, expressed as a decimal.
"Consolidated Interest Expense" means, with respect to any
Person for any period, the sum of, without duplication:
(1) the aggregate of the interest expense of such Person
and its Restricted Subsidiaries for such period determined on
a consolidated basis in accordance with GAAP, including
without limitation: (a) any amortization of debt discount and
amortization or write-off of deferred financing costs; (b) the
net costs under
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Interest Swap Obligations; (c) all capitalized interest; and
(d) the interest portion of any deferred payment obligation;
and
(2) the interest component of Capitalized Lease
Obligations paid, accrued and/or scheduled to be paid or
accrued by such Person and its Restricted Subsidiaries during
such period as determined on a consolidated basis in
accordance with GAAP.
"Consolidated Net Income" means, with respect to any Person,
for any period, the aggregate net income (or loss) of such
Person and its Restricted Subsidiaries for such period on a
consolidated basis, determined in accordance with GAAP;
provided that there shall be excluded therefrom (without
duplication):
(1) after-tax gains and losses from Asset Sales (without
regard to the $5.0 million limitation set forth in the
definition thereof) or abandonments or reserves relating
thereto;
(2) after-tax items classified as extraordinary or
nonrecurring gains and losses;
(3) the net income of any Person acquired in a "pooling
of interests" transaction accrued prior to the date it becomes
a Restricted Subsidiary of the referent Person or is merged or
consolidated with the referent Person or any Restricted
Subsidiary of the referent Person;
(4) the net income (but not loss) of any Restricted
Subsidiary of the referent Person to the extent that the
declaration of dividends or similar distributions by that
Restricted Subsidiary of that income is restricted by a
contract, operation of law or otherwise, unless received;
(5) the net income of any Person, other than a Restricted
Subsidiary of the referent Person, except to the extent of
cash dividends or distributions paid to the referent Person or
to a Restricted Subsidiary of the referent Person by such
Person;
(6) any restoration to income of any contingency reserve,
except to the extent that provision for such reserve was made
out of Consolidated Net Income accrued at any time following
the Issue Date;
(7) income or loss attributable to discontinued
operations; and
(8) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent
Person's
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assets, any earnings of the successor corporation prior to
such consolidation, merger or transfer of assets.
Notwithstanding the foregoing, "Consolidated Net Income" shall
be calculated without giving effect to:
(i) any premiums, fees or expenses incurred in connection
with the transactions; and
(ii) the amortization, depreciation or non-cash charge of
any amounts required or permitted by Statement of Financial
Accounting Standards No. 141, "Business Combinations," and No.
142, "Goodwill and Other Intangible Assets," or any successor
pronouncements of the Financial Accounting Standards Board or
with respect to the impairment of the value of any long-lived
assets.
"Consolidated Net Worth" of any Person means the consolidated
stockholders' equity of such Person, determined on a
consolidated basis in accordance with GAAP, less (without
duplication) amounts attributable to Disqualified Capital
Stock of such Person.
"Consolidated Non-cash Charges" means, with respect to any
Person, for any period, the aggregate depreciation,
amortization and other non-cash expenses of such Person and
its Restricted Subsidiaries reducing Consolidated Net Income
of such Person and its Restricted Subsidiaries for such
period, determined on a consolidated basis in accordance with
GAAP (excluding any such charges constituting an extraordinary
item or loss or any such charge which requires an accrual of
or a reserve for cash charges for any future period).
"Corporate Trust Office of the Trustee" means the principal
office of the Trustee at which at any time its corporate trust
business shall be administered, which office at the date
hereto is located at 707 Wilshire Boulevard, 17th Floor, Los
Angeles, California 90017, Attention: Corporate Trust
Department, or such other address as the Trustee may designate
from time to time by notice to the Holders and the Company, or
the principal corporate trust office of any successor Trustee
(or such other address as such successor Trustee may designate
from time to time by notice to the Holders and the Company).
"Credit Agreement" means the Credit Agreement entered into on
the Issue Date, among Holdings, the Company, Solvest Ltd., the
lenders party thereto in their capacities as lenders
thereunder and Deutsche Bank AG New York Branch, as
administrative agent,
14
The Bank of Nova Scotia and Bank of America, N.A., as
co-syndication agents, and Fleet National Bank and Societe
Generale, as co-documentation agents, together with the
related documents thereto (including, without limitation, any
guarantee agreements and security documents), in each case as
such agreements may be amended (including any amendment and
restatement thereof), supplemented or otherwise modified from
time to time, including any agreement extending the maturity
of, refinancing, replacing or otherwise restructuring
(including, without limitation, increasing the amount of
available borrowings thereunder or adding Restricted
Subsidiaries of the Company as additional borrowers or
guarantors thereunder) all or any portion of the Indebtedness
under such agreement or any successor or replacement agreement
or agreements and whether by the same or any other agent,
lender or group of lenders.
"Currency Agreement" means any foreign exchange contract,
currency swap agreement or other similar agreement or
arrangement designed to protect the Company or any Restricted
Subsidiary of the Company against fluctuations in currency
values.
"Default" means an event or condition the occurrence of which
is, or with the lapse of time or the giving of notice or both
would be, an Event of Default.
"Disqualified Capital Stock" means that portion of any Capital
Stock which, by its terms (or by the terms of any security
into which it is convertible or for which it is exchangeable
at the option of the holder thereof), or upon the happening of
any event (other than an event which would constitute a Change
of Control or an Asset Sale and other than an event of default
as a result of the bankruptcy, insolvency or similar event of
the issuer thereof contained in a security into which such
Capital Stock is convertible or for which it is exchangeable),
matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise, or is redeemable at the sole
option of the holder thereof (except, in each case, upon the
occurrence of a Change of Control or an Asset Sale and other
than an event of default as a result of the bankruptcy,
insolvency or similar event of the issuer thereof contained in
a security into which such Capital Stock is convertible or for
which it is exchangeable), on or prior to the final maturity
date of the 2009 Notes or the 2013 Notes, as applicable.
"Domestic Restricted Subsidiary" means a Restricted Subsidiary
incorporated or otherwise organized or existing under the laws
of the United States, any state thereof or any territory or
possession of the United States.
15
"Equity Offering" means any public or private sale or issuance
of Qualified Capital Stock of Holdings or the Company;
provided that, in the event of an Equity Offering by Holdings,
Holdings contributes to the capital of the Company the portion
of the net cash proceeds of such Equity Offering necessary to
pay the aggregate redemption price (plus accrued interest to
the Redemption Date) of the New Senior Notes to be redeemed
pursuant to Section 3.8 of the New Senior Notes Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute or statutes thereto.
"Existing Notes" means the Company's 8.625% Senior Notes due
2009 (the "2009 Notes") and the Company's 8.75% Debentures due
2013 (the "2013 Notes").
"fair market value" means, with respect to any asset or
property, the price which could be negotiated in an
arm's-length, free market transaction, for cash, between a
willing seller and a willing and able buyer, neither of whom
is under undue pressure or compulsion to complete the
transaction. Fair market value shall be determined by the
Board of Directors of the Company acting reasonably and in
good faith and shall be evidenced by a Board Resolution of the
Board of Directors of the Company delivered to the Trustee.
"Final Memorandum" shall mean the Company's final offering
memorandum dated March 17, 2003, whereby the Company offered
$475,000,000 aggregate principal amount of its New Senior
Notes.
"Foreign Restricted Subsidiary" means any Restricted
Subsidiary other than a Domestic Restricted Subsidiary.
"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.
"Guarantee" has the meaning set forth in Section 1601.
"Guarantor" means: (1) certain of the Company's Domestic
Restricted Subsidiaries as of the Issue Date; and (2) each of
the Company's Restricted Subsidiaries that in the future
executes a
16
supplemental indenture in which such Restricted Subsidiary
agrees to be bound by the terms of this Indenture as a
Guarantor; 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.
"Guarantor Designated Senior Debt" means (1) Indebtedness of a
Guarantor under or in respect of the Credit Agreement and (2)
any other Indebtedness of a Guarantor constituting Guarantor
Senior Debt which, at the time of determination, has an
aggregate principal amount of at least $50.0 million and is
specifically designated in the instrument evidencing such
Guarantor Senior Debt as "Guarantor Designated Senior Debt" by
the Company.
"Guarantor Senior Debt" means, with respect to any Guarantor:
the principal of, premium, if any, and interest (including any
interest accruing subsequent to the filing of a petition of
bankruptcy at the rate provided for in the documentation with
respect thereto, whether or not such interest is an allowed
claim under applicable law) on any Indebtedness of, or
guaranteed by, a Guarantor, whether outstanding on the Issue
Date or thereafter created, incurred or assumed, unless, in
the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same
is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Guarantee of such
Guarantor. Without limiting the generality of the foregoing,
"Guarantor Senior Debt" shall also include the principal of,
premium, if any, interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the
rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under
applicable law) on, and all other amounts owing in respect of
(including guarantees of the foregoing obligations):
(x) all monetary obligations of every nature of such
Guarantor under, or with respect to, the Credit Agreement,
including, without limitation, obligations to pay principal,
premium and interest, reimbursement obligations under letters
of credit and bank guarantees, fees, expenses and indemnities
(and guarantees thereof);
(y) all Interest Swap Obligations (and guarantees
thereof); and
(z) all obligations under Currency Agreements (and
guarantees thereof),
17
in each case whether outstanding on the Issue Date or
thereafter incurred.
Notwithstanding the foregoing, "Guarantor Senior Debt" shall
not include:
(1) any Indebtedness of such Guarantor to a Subsidiary of
such Guarantor;
(2) Indebtedness to, or guaranteed on behalf of, any
director, officer or employee of such Guarantor or any
Subsidiary of such Guarantor (including, without limitation,
amounts owed for compensation);
(3) Indebtedness to trade creditors and other amounts
incurred in connection with obtaining goods, materials or
services; provided that obligations incurred pursuant to the
Credit Agreement shall not be excluded pursuant to this clause
(3);
(4) Indebtedness represented by Disqualified Capital
Stock;
(5) any liability for federal, state, local or other
taxes owed or owing by such Guarantor;
(6) that portion of any Indebtedness incurred in
violation of Section 1014 (but, as to any such obligation, no
such violation shall be deemed to exist for purposes of this
clause (6) if the holder(s) of such obligation or their
representative shall have received an officer's certificate
(and/or a representation or warranty) from the Company to the
effect that the incurrence of such Indebtedness does not (or,
in the case of revolving credit indebtedness, that the
incurrence of the entire committed amount thereof at the date
on which the initial borrowing thereunder is made would not)
violate such Section);
(7) with respect to any Guarantor, Indebtedness which,
when incurred and without respect to any election under
Section 1111(b) of Title 11, United States Code, is without
recourse to such Guarantor;
(8) Guarantees or the guarantees of the New Senior Notes;
and
(9) with respect to any Guarantor, any Indebtedness which
is, by its express terms, subordinated in right of payment to
any other Indebtedness of such Guarantor.
"Holder" means a Person in whose name a Note is registered.
18
"Holdings" means DHM Holding Company, Inc., a Delaware
corporation and the parent of the Company.
"Indebtedness" means with respect to any Person, without
duplication:
(1) all Obligations of such Person for borrowed money;
(2) all Obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(3) all Capitalized Lease Obligations of such Person;
(4) all Obligations of such Person issued or assumed as
the deferred purchase price of property, all conditional sale
obligations and all Obligations under any title retention
agreement (but excluding trade accounts payable and other
accrued liabilities arising in the ordinary course of business
that are not overdue by 120 days or more or are being
contested in good faith by appropriate proceedings promptly
instituted and diligently conducted and payables under the
Company's grower loans program in the ordinary course of
business and consistent with past practice);
(5) all Obligations for the reimbursement of any obligor
on any letter of credit, banker's acceptance or similar credit
transaction;
(6) guarantees and other contingent obligations in
respect of Indebtedness referred to in clauses (1) through (5)
above and clause (8) below;
(7) all Obligations of any other Person of the type
referred to in clauses (1) through (6) which are secured by
any Lien on any property or asset of such Person, the amount
of such Obligation being deemed to be the lesser of the fair
market value of such property or asset or the amount of the
Obligation so secured;
(8) all Obligations under Currency Agreements and
Interest Swap Obligations of such Person; and
(9) all Disqualified Capital Stock issued by such Person
with the amount of Indebtedness represented by such
Disqualified Capital Stock being equal to the greater of its
voluntary or involuntary liquidation preference and its
maximum fixed repurchase price, but excluding accrued
dividends, if any.
For purposes hereof, the "maximum fixed repurchase price" of
any Disqualified Capital Stock which does not have a fixed
repurchase
19
price shall be calculated in accordance with the terms of such
Disqualified Capital Stock as if such Disqualified Capital
Stock were purchased on any date on which Indebtedness shall
be required to be determined pursuant to this Indenture, and
if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market
value shall be determined reasonably and in good faith by the
Board of Directors of the issuer of such Disqualified Capital
Stock.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Independent Financial Advisor" means a firm: (1) which does
not, and whose directors, officers and employees or Affiliates
do not, have a direct or indirect financial interest in the
Company; and (2) which, in the judgment of the Board of
Directors of the Company, is otherwise independent and
qualified to perform the task for which it is to be engaged.
"Interest Swap Obligations" means the obligations of any
Person pursuant to any arrangement with any other Person,
whereby, directly or indirectly, such Person is entitled to
receive from time to time periodic payments calculated by
applying either a floating or a fixed rate of interest on a
stated notional amount in exchange for periodic payments made
by such other Person calculated by applying a fixed or a
floating rate of interest on the same notional amount and
shall also include, without limitation, interest rate swaps,
caps, floors, collars and similar agreements.
"Investment" means, with respect to any Person, any direct or
indirect loan or other extension of credit (including, without
limitation, a guarantee) or capital contribution to (by means
of any transfer of cash or other property to others or any
payment for property or services for the account or use of
others), or any purchase or acquisition by such Person of any
Capital Stock, bonds, notes, debentures or other securities or
evidences of Indebtedness issued by, any other Person.
"Investment" shall exclude extensions of trade credit by the
Company and its Restricted Subsidiaries on commercially
reasonable terms in accordance with normal trade practices of
the Company or such Restricted Subsidiaries, as the case may
be. If the Company or any Restricted Subsidiary of the Company
sells or otherwise disposes of any Common Stock of any direct
or indirect Restricted Subsidiary of the Company such that,
after giving effect to any such sale or disposition, the
Company no longer owns, directly or indirectly, 50% of the
outstanding Common Stock of such Restricted Subsidiary, the
Company shall be deemed to have made
20
an Investment on the date of any such sale or disposition
equal to the fair market value of the Common Stock of such
Restricted Subsidiary not sold or disposed of.
"Issue Date" means March 28, 2003, the date of original
issuance of the New Senior Notes.
"Net Cash Proceeds" means, with respect to any Asset Sale, the
proceeds in the form of cash or Cash Equivalents including
payments in respect of deferred payment obligations when
received in the form of cash or Cash Equivalents (other than
the portion of any such deferred payment constituting
interest) received by the Company or any of its Restricted
Subsidiaries from such Asset Sale net of:
(1) reasonable out-of-pocket expenses and fees relating
to such Asset Sale (including, without limitation, legal,
accounting and investment banking fees and sales commissions);
(2) taxes paid or payable after taking into account any
reduction in consolidated tax liability due to available tax
credits or deductions and any tax sharing arrangements;
(3) repayment of Indebtedness that is secured by the
property or assets that are the subject of such Asset Sale or
that is required, pursuant to an agreement or instrument
existing on the Issue Date, to be repaid from the proceeds of
such Asset Sale other than pursuant to this Indenture; and
(4) appropriate amounts to be provided by the Company or
any Restricted Subsidiary, as the case may be, as a reserve,
in accordance with GAAP, 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.
"New Senior Notes" means the $475.0 million aggregate
principal amount of the Company's 8-7/8% Senior Notes due
2011.
"New Senior Notes Indenture" means the Indenture, dated as of
March 28, 2003, by and among the Company, the Guarantors and
the Trustee relating to the New Senior Notes.
21
"Notes" means the Existing Notes and any other Notes, if any,
that are issued under this Indenture, as amended or
supplemented from time to time.
"Obligations" means all obligations for principal, premium,
interest (including any interest accruing subsequent to the
filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such
interest is an allowed claim under applicable law), penalties,
fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any
Indebtedness.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the Chief Financial Officer, the President, any Vice
President, the Treasurer or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
officers of the Company, at least one of whom shall be the
principal executive officer or principal financial officer of
the Company, and delivered to the Trustee.
"Opinion of Counsel" means an opinion from legal counsel who
is reasonably acceptable to the Trustee that meets the
requirements of Section 301 hereof. The counsel may be an
employee of or counsel to the Company, any Subsidiary of the
Company or the Trustee.
"Pari Passu Debt" means any Indebtedness of the Company or any
Guarantor that ranks pari passu in right of payment with the
Notes or such Guarantee, as applicable.
"Permitted Holders" means (i) David H. Murdock, his estate,
spouse, heirs, ancestors, lineal descendants, legatees, legal
representatives or the trustee of a bona fide trust of which
one or more of the foregoing are the principal beneficiaries
or grantors thereof and (ii) any entity controlled, directly
or indirectly, by any Persons referred to in the preceding
clause (i), whether through the ownership of voting
securities, by contract or otherwise.
"Permitted Indebtedness" means, without duplication, each of
the following:
(1) Indebtedness under the New Senior Notes or the
exchange notes issued in exchange for the New Senior Notes
pursuant to a registration statement in an aggregate principal
amount not to exceed $475.0 million and the Guarantees
thereof;
22
(2) Indebtedness incurred pursuant to the Credit
Agreement in an aggregate principal amount at any time
outstanding not to exceed $1,125.0 million less the amount of
all repayments of terms loans and permanent commitment
reductions in the revolving credit portion of the Credit
Agreement actually made with Net Cash Proceeds of Asset Sales
applied thereto as required by Section 1015;
(3) other Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the Issue Date (including any
"put" or similar rights of minority holders of Restricted
Subsidiaries in existence as of the Issue Date) reduced by the
amount of any scheduled amortization payments or mandatory
prepayments when actually paid or permanent reductions
thereon;
(4) Interest Swap Obligations of the Company or any
Restricted Subsidiary of the Company covering Indebtedness of
the Company or any of its Restricted Subsidiaries; provided,
however, that such Interest Swap Obligations are entered into
to protect the Company and its Restricted Subsidiaries from
fluctuations in interest rates on their outstanding
Indebtedness to the extent the notional principal amount of
any such Interest Swap Obligation does not, at the time of the
initial incurrence thereof, exceed the principal amount of the
Indebtedness to which such Interest Swap Obligation relates;
(5) (A) Indebtedness under Currency Agreements; provided
that in the case of Currency Agreements which relate to
Indebtedness, such Currency Agreements do not increase the
Indebtedness of the Company and its Restricted Subsidiaries
outstanding other than as a result of fluctuations in foreign
currency exchange rates or by reason of fees, indemnities and
compensation payable thereunder and (B) Indebtedness under
Commodities Agreements;
(6) Indebtedness of a Restricted Subsidiary of the
Company to the Company or to a Wholly Owned Restricted
Subsidiary of the Company for so long as such Indebtedness is
held by the Company or a Wholly Owned Restricted Subsidiary of
the Company or the holder of a Lien permitted under this
Indenture, in each case subject to no Lien held by a Person
other than the Company or a Wholly Owned Restricted Subsidiary
of the Company or the holder of a Lien permitted under this
Indenture; provided that if as of any date any Person other
than the Company or a Wholly Owned Restricted Subsidiary of
the Company or the holder of a Lien permitted under this
Indenture owns or holds any such Indebtedness or holds a Lien
in respect of such Indebtedness, such
23
date shall be deemed the incurrence of Indebtedness not
constituting Permitted Indebtedness under this clause (6) by
the issuer of such Indebtedness;
(7) (A) Indebtedness of the Company to a Wholly Owned
Restricted Subsidiary of the Company for so long as such
Indebtedness is held by a Wholly Owned Restricted Subsidiary
of the Company or the holder of a Lien permitted under this
Indenture, in each case subject to no Lien other than a Lien
permitted under this Indenture; provided that (a) any
Indebtedness of the Company to any Wholly Owned Restricted
Subsidiary of the Company that is not a Guarantor is unsecured
and subordinated, pursuant to a written agreement, to the
Company's obligations under this Indenture and the Notes and
(b) if as of any date any Person other than a Wholly Owned
Restricted Subsidiary of the Company or the holder of a Lien
permitted under this Indenture owns or holds any such
Indebtedness or holds a Lien in respect of such Indebtedness,
such date shall be deemed the incurrence of Indebtedness not
constituting Permitted Indebtedness under this clause (7) by
the Company and (B) Indebtedness of the Company or any of its
Restricted Subsidiaries to Saba Trading AB or any other
Restricted Subsidiary of the Company that is not a Wholly
Owned Restricted Subsidiary of the Company in the ordinary
course of business consistent with past practice;
(8) Indebtedness arising from the honoring by a bank or
other financial institution of a check, draft or similar
instrument inadvertently (except in the case of daylight
overdrafts) drawn against insufficient funds in the ordinary
course of business; provided, however, that such Indebtedness
is extinguished within five business days of incurrence;
(9) Indebtedness of the Company or any of its Restricted
Subsidiaries in respect of performance bonds, bankers'
acceptances, workers' compensation claims, surety or appeal
bonds, payment obligations in connection with self-insurance
or similar obligations, completion or performance guarantees
or standby letters of credit issued for the purpose of
supporting such obligations and bank overdrafts (and letters
of credit in respect thereof) in the ordinary course of
business;
(10) Indebtedness represented by Capitalized Lease
Obligations, mortgage financings and Purchase Money
Indebtedness of the Company and its Restricted Subsidiaries
incurred in the ordinary course of business not to exceed
$25.0 million at any one time outstanding;
24
(11) Refinancing Indebtedness;
(12) Indebtedness represented by guarantees by the Company
or its Restricted Subsidiaries of Indebtedness otherwise
permitted to be incurred under this Indenture;
(13) Indebtedness of the Company or any Restricted
Subsidiary consisting of guarantees, indemnities or
obligations in respect of purchase price adjustments in
connection with the acquisition or disposition of assets or
the Capital Stock of Subsidiaries;
(14) guarantees furnished by the Company or its Restricted
Subsidiaries in the ordinary course of business of
Indebtedness of another Person in an aggregate amount not to
exceed $25.0 million at any one time outstanding;
(15) Indebtedness incurred under commercial letters of
credit issued for the account of the Company or any of its
Restricted Subsidiaries in the ordinary course of business
(and not for the purpose of, directly or indirectly, incurring
Indebtedness or providing credit support or a similar
arrangement in respect of Indebtedness), provided that any
drawing under any such letter of credit is reimbursed in full
within seven days;
(16) Indebtedness of the Company or any of its Restricted
Subsidiaries relating to any "earn-out" obligations payable in
connection with any acquisition made by the Company or any
Restricted Subsidiary not prohibited by this Indenture;
(17) Indebtedness of Foreign Restricted Subsidiaries in an
aggregate principal amount not to exceed $50.0 million at any
one time outstanding;
(18) Indebtedness of Foreign Restricted Subsidiaries (and
any guarantee thereof by the Company) incurred in connection
with grower loan programs in an aggregate principal amount not
to exceed $50.0 million at any one time outstanding;
(19) without duplication, Indebtedness of the Company or
any of its Restricted Subsidiaries under letters of credit and
bank guarantees required by governmental laws, orders and
regulations which letters of credit will be backstopped by
letters of credit under the Credit Agreement;
(20) Indebtedness of the Company or any of its Restricted
Subsidiaries incurred in connection with vehicle inventory
loans in an aggregate principal amount not to exceed $5.0
million at any one time outstanding;
25
(21) Indebtedness of the Company and its Restricted
Subsidiaries representing Obligations in existence on the
Issue Date that become Indebtedness after the Issue Date as a
result of the implementation of FASB Interpretation No. 46,
"Consolidation of Variable Interest Entities"; and
(22) additional Indebtedness of the Company and its
Restricted Subsidiaries in an aggregate principal amount not
to exceed $35.0 million at any one time outstanding (which
amount may, but need not, be incurred in whole or in part
under the Credit Agreement).
For purposes of determining compliance with Section 1014, in
the event that an item of Indebtedness meets the criteria of
more than one of the categories of Permitted Indebtedness
described in clauses (1) through (22) above or is entitled to
be incurred pursuant to the Consolidated Fixed Charge Coverage
Ratio provisions of Section 1014 hereof, the Company shall, in
its sole discretion, classify (or from time to time may
reclassify) such item of Indebtedness in any manner that
complies with this definition and such item of Indebtedness
will be treated as having been incurred pursuant to only one
of such categories. Accrual of interest, accretion or
amortization of original issue discount, a change in the
amount of Indebtedness due solely to fluctuations in the
exchange rates of currencies, the payment of interest on any
Indebtedness in the form of additional Indebtedness with the
same terms, and the payment of dividends on Disqualified
Capital Stock in the form of additional shares of the same
class of Disqualified Capital Stock will not be deemed to be
an incurrence of Indebtedness or an issuance of Disqualified
Capital Stock for purposes of Section 1014 hereof.
"Permitted Investments" means:
(1) Investments by the Company or any Restricted
Subsidiary of the Company in any Person that is or will become
immediately after such Investment a Restricted Subsidiary of
the Company or that will merge or consolidate into the Company
or a Restricted Subsidiary of the Company;
(2) Investments in the Company by any Restricted
Subsidiary of the Company; provided that any Indebtedness
(other than Indebtedness to Saba Trading AB or any other
Restricted Subsidiary of the Company that is not a Wholly
Owned Restricted Subsidiary of the Company in the ordinary
course of business consistent with past practice) evidencing
such Investment and held by a Restricted Subsidiary that is
not a Guarantor is unsecured and
26
subordinated, pursuant to a written agreement, to the
Company's obligations under the Notes and this Indenture;
(3) Investments in cash and Cash Equivalents;
(4) loans to employees, directors and officers of the
Company and its Restricted Subsidiaries in the ordinary course
of business for bona fide business purposes not in excess of
$5.0 million at any one time outstanding;
(5) Obligations under Currency Agreements, Interest Swap
Obligations and Commodities Agreements entered into in the
ordinary course of the Company's or its Restricted
Subsidiaries' businesses and not for speculative purposes and
otherwise in compliance with this Indenture;
(6) additional Investments not to exceed $50.0 million at
any one time outstanding;
(7) Investments in securities of trade creditors,
licensors, licensees or customers received pursuant to any
plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers
or in good faith settlement of delinquent obligations of such
trade creditors or customers;
(8) Investments made by the Company or its Restricted
Subsidiaries as a result of consideration received in
connection with an Asset Sale made in compliance with Section
1015, whether or not such consideration is equal to or greater
than $5.0 million;
(9) Investments represented by guarantees that are
otherwise permitted under this Indenture;
(10) Investments the payment for which is Qualified
Capital Stock of the Company;
(11) Investments resulting from the creation of Liens on
the assets of the Company or any of its Restricted
Subsidiaries in compliance with Section 1008;
(12) Investments by the Company or any Restricted
Subsidiary in connection with grower loan programs in an
amount not to exceed $75.0 million at any one time
outstanding;
(13) Investments arising as a result of the exercise of
any "put" or similar rights of minority holders of Restricted
Subsidiaries or
27
"call" or similar rights of the Company in existence as of the
Issue Date; and
(14) advances to employees, directors and officers of the
Company and its Restricted Subsidiaries in the ordinary course
of business for bona fide business purposes.
"Person" means an individual, partnership, corporation,
limited liability company, unincorporated organization, trust
or joint venture, or any entity similar to any of the
foregoing organized under the laws of other countries, or a
governmental agency or political subdivision thereof.
"Preferred Stock" of any Person means any Capital Stock of
such Person that has preferential rights to any other Capital
Stock of such Person with respect to dividends or redemptions
or upon liquidation.
"Purchase Date" means, with respect to any Note to be
repurchased, the date fixed for such repurchase by or pursuant
to this Indenture.
"Purchase Money Indebtedness" means Indebtedness of the
Company and its Restricted Subsidiaries incurred in the normal
course of business for the purpose of financing all or any
part of the purchase price, or the cost of installation,
construction or improvement, of property or equipment.
"Purchase Price" means the amount payable for the repurchase
of any Note on a Purchase Date, exclusive of accrued and
unpaid interest thereon to the Purchase Date, unless otherwise
specifically provided.
"Qualified Capital Stock" means any Capital Stock that is not
Disqualified Capital Stock.
"Redemption Date" means, with respect to any Note to be
redeemed, the date fixed for such redemption by or pursuant to
this Indenture.
"Redemption Price" means the amount payable for the redemption
of any Note on a Redemption Date, exclusive of' accrued and
unpaid interest thereon to the Redemption Date, unless
otherwise specifically provided.
"Refinance" means, in respect of any security or Indebtedness,
to refinance, extend, renew, refund, repay, prepay, redeem,
defease or retire, or to issue a security or Indebtedness in
exchange or
28
replacement for, such security or Indebtedness in whole or in
part. "Refinanced" and Refinancing" shall have correlative
meanings.
"Refinancing Indebtedness" means any Refinancing by the
Company or any Restricted Subsidiary of the Company of
Indebtedness incurred in accordance with Section 1014 (other
than pursuant to clauses (2), (4), (5), (6), (7), (8), (9),
(10), (12), (13) through (20) and (22) of the definition of
"Permitted Indebtedness"), in each case that does not:
(1) result in an increase in the aggregate principal
amount of Indebtedness of such Person as of the date of such
proposed Refinancing above the sum of (i) the aggregate
principal amount of such Indebtedness, plus (ii) the accrued
interest on and the amount of any premium required to be paid
under the terms of the instrument governing such Indebtedness,
plus (iii) the amount of reasonable expenses incurred by the
Company in connection with such Refinancing; or
(2) create Indebtedness with: (a) a Weighted Average Life
to Maturity that is less than the Weighted Average Life to
Maturity of the Indebtedness being Refinanced; or (b) a final
maturity earlier than the final maturity of the Indebtedness
being Refinanced;
provided that (x) if such Indebtedness being Refinanced is
Indebtedness solely of the Company (and is not otherwise
guaranteed by a Restricted Subsidiary of the Company), then
such Refinancing Indebtedness shall be Indebtedness solely of
the Company and (y) if such Indebtedness being Refinanced is
subordinate or junior to the Notes or the Guarantees, then
such Refinancing Indebtedness shall be subordinate to the
Notes or the Guarantees, as the case may be, at least to the
same extent and in the same manner as the Indebtedness being
Refinanced.
"Responsible Officer" shall mean, when used with respect to
the Trustee, any officer within the corporate trust department
of the Trustee, including any vice president, assistant vice
president, assistant secretary, assistant treasurer, trust
officer or any other officer of the Trustee who customarily
performs functions similar to those performed by the Persons
who at the time shall be such officers, respectively, or to
whom any corporate trust matter is referred because of such
person's knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the
administration of this Indenture.
"Representative" means the indenture trustee or other trustee,
agent or representative in respect of any Guarantor Designated
29
Senior Debt; provided that if, and for so long as, any
Guarantor Designated Senior Debt lacks such a representative,
then the Representative for such Guarantor Designated Senior
Debt shall at all times constitute the holders of a majority
in outstanding principal amount of such Guarantor Designated
Senior Debt.
"Restricted Subsidiary" of any Person means any Subsidiary of
such Person which at the time of determination is not an
Unrestricted Subsidiary.
"Sale and Leaseback Transaction" means any direct or indirect
arrangement with any Person or to which any such Person is a
party, providing for the leasing to the Company or a
Restricted Subsidiary of any property, whether owned by the
Company or any Restricted Subsidiary at the Issue Date or
later acquired, which has been or is to be sold or transferred
by the Company or such Restricted Subsidiary to such Person or
to any other Person from whom funds have been or are to be
advanced by such Person on the security of such property.
"Significant Subsidiary", with respect to any Person, means
any Restricted Subsidiary of such Person that satisfies the
criteria for a "significant subsidiary" set forth in Rule
1-02(w) of Regulation S-X under the Exchange Act.
"Subordinated Indebtedness" means Indebtedness of the Company
or any Guarantor that is subordinate or junior in right of
payment to the Notes or the Guarantee of such Guarantor, as
the case may be.
"Subsidiary", with respect to any Person, means:
(1) any corporation, association or other business entity
of which the outstanding Capital Stock having at least a
majority of the votes entitled to be cast in the election of
directors, managers or trustees of such corporation,
association or other business entity under ordinary
circumstances shall at the time be owned, directly or
indirectly, by such Person and its Subsidiaries; or
(2) any partnership (a) the sole general partner or the
managing partner of which is such Person or a Subsidiary of
such Person or (b) the only general partners of which are such
Person and its Subsidiaries.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable
provisions of this Indenture, and thereafter means the
successor serving hereunder.
30
"Unrestricted Subsidiary" of any Person means:
(1) any Subsidiary of such Person that at the time of
determination shall be or continue to be designated an
Unrestricted Subsidiary by the Board of Directors of such
Person in the manner provided below; and
(2) any Subsidiary of an Unrestricted Subsidiary.
The Board of Directors may designate any Subsidiary (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, the Company or any other Subsidiary of the Company that is
not a Subsidiary of the Subsidiary to be so designated;
provided that:
(1) the Company certifies to the Trustee that such
designation complies with Section 1012 hereof; and
(2) 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 its Restricted
Subsidiaries.
For purposes of making the determination of whether any such
designation of a Subsidiary as an Unrestricted Subsidiary
complies with Section 1012 hereof, the portion of the fair
market value of the net assets of such Subsidiary of the
Company at the time that such Subsidiary is designated as an
Unrestricted Subsidiary that is represented by the interest of
the Company and its Restricted Subsidiaries in such
Subsidiary, in each case as determined in good faith by the
Board of Directors of the Company, shall be deemed to be an
Investment. Such designation will be permitted only if such
Investment would be permitted at such time under Section 1012
hereof.
The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary only if:
(1) immediately after giving effect to such designation,
the Company is able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) in compliance
with Section 1014(a) hereof; and
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(2) immediately before and immediately after giving
effect to such designation, no Default or Event of Default
shall have occurred and be continuing.
Any such designation by the Board of Directors shall be
evidenced to the Trustee by promptly filing with the Trustee a
copy of the Board Resolution giving effect to such designation
and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by
dividing (a) the then outstanding aggregate principal amount
of such Indebtedness into (b) the sum of the total of the
products obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity or other
required payment of principal, including payment at final
maturity, in respect thereof, by (ii) the number of years
(calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person means any
Wholly Owned Subsidiary of such Person which at the time of
determination is a Restricted Subsidiary of such Person.
"Wholly Owned Subsidiary" of any Person means any Subsidiary
of such Person of which all the outstanding voting securities
(other than in the case of a foreign Subsidiary, directors'
qualifying shares or an immaterial amount of shares required
to be owned by other Persons pursuant to applicable law) are
owned by such Person or any Wholly Owned Subsidiary of such
Person."
Section 102 Section References. Each reference to a particular
section set forth in this Second Supplemental Indenture shall, unless the
context otherwise requires, refer to this Second Supplemental Indenture.
ARTICLE TWO
INCREASE IN INTEREST RATES
Section 201 Modification of 2009 Notes. Pursuant to Section 901
of the Original Indenture, the following amendment to the terms of the Indenture
will be effective solely with respect to the 2009 Notes:
(a) The following clause is added to the first sentence
of Section 204 of the First Supplemental Indenture after the words "provided
that":
"from and after March 28, 2003, interest shall accrue and
shall be paid at the rate of 8.625% per annum; provided
further that"
32
Section 202 Modification of 2013 Notes. Pursuant to Section 901
of the Original Indenture, the following amendment to the terms of the Indenture
will be effective solely with respect to the 2013 Debentures:
(a) The following clause is added to the first sentence
of Section 5 of the 1993 Officers' Certificate after the word "respectively":
";provided that from and after March 28, 2003, interest on the
Debentures shall accrue and be paid at the rate of 8.75% per
annum."
ARTICLE THREE
AMENDMENT
Section 301 Amendments. Pursuant to Section 901 of the Original
Indenture, the following amendments to the Original Indenture will be effective
solely with respect to the 2009 Notes and the 2013 Debentures:
(a) The following Section 114 is added to Article One of
the Original Indenture, after Section 113 thereof:
"It is the intention of the Company that the provisions hereof
shall be consistent with the provisions of the New Senior
Notes Indenture. Notwithstanding anything to the contrary
contained herein, this Indenture shall not confer any greater
right or benefit upon the holders of the Existing Notes than
the rights and benefits conferred upon the holders of the New
Senior Notes pursuant to the New Senior Notes Indenture."
(b) The following is added to clause (1) of Section 501
of the Original Indenture, after the words "period of 30 days" therein:
"(whether or not such payment shall be prohibited by Article
Fifteen of this Indenture)"
(c) The following is added to clause (2) of Section 501
of the Original Indenture, after the words "at its Maturity" therein:
"upon redemption or otherwise (including the failure to make a
payment to purchase Notes tendered pursuant to a Change of
Control Offer or a Net Proceeds Offer) (whether or not such
payment shall be prohibited by Article Fifteen of this
Indenture)"
(d) The words "60 days" in clause (4) of Section 501 of
the Original Indenture are deleted and replaced with the words "45 days".
(e) The following is added to clause (4) of Section 501
of the Original Indenture, after the words "such notice is a "Notice of Default"
hereunder" therein:
33
"(except in the case of a default with respect to Section 801
hereof, which will constitute an Event of Default with such
notice requirement but without such passage of time
requirement)"
(f) The following is added to clause (7) of Section 501
of the Original Indenture, after the words "the commencement by the Company"
therein:
"or any Significant Subsidiary"
(g) The following clauses are added to Section 501 of the
Original Indenture, after clause (7) thereof:
"(8) the failure to pay at final maturity (giving effect
to any applicable grace periods and any extensions thereof)
the stated principal amount of any Indebtedness of the Company
or any Restricted Subsidiary of the Company, or the
acceleration of the final stated maturity of any such
Indebtedness (which acceleration is not rescinded, annulled or
otherwise cured within 30 days of receipt by the Company or
such Restricted Subsidiary of notice of any such acceleration)
if the aggregate principal amount of such Indebtedness,
together with the principal amount of any other such
Indebtedness in default for failure to pay principal at final
stated maturity or which has been accelerated (in each case
with respect to which the 30-day period described above has
elapsed), aggregates $25.0 million or more at any time;
provided that if such failure to pay shall be remedied, waived
or extended within 30 days of receipt by the Company or such
Restricted Subsidiary of notice of such acceleration, then any
Default or Event of Default hereunder shall be deemed likewise
to be remedied, waived or extended without further action by
the Company; or
(9) one or more judgments in an aggregate amount in
excess of $25.0 million shall have been rendered against the
Company or any of its Restricted Subsidiaries and such
judgments remain undischarged, unpaid or unstayed for a period
of 60 days after such judgment or judgments become final and
non-appealable; provided, however, that the rendering of any
such judgment(s) shall not be an Event of Default under this
clause (9) unless (i) the Company and its Restricted
Subsidiaries which are subject to the order, as of the date of
the issuance of such judgment(s), have at least $25.0 million
in net assets located in such court's jurisdiction or (ii) a
final and non-appealable order enforcing such judgment(s) is
entered by a court of competent jurisdiction in a jurisdiction
where the Company and its Restricted Subsidiaries subject to
the order, as of the date of the entry of such order of
enforcement, have at least $25.0 million in net assets located
in such jurisdiction; or
34
(10) any Guarantee of a Significant Subsidiary ceases to
be in full force and effect or any Guarantee of a Significant
Subsidiary is declared to be null and void and unenforceable
or any Guarantee of a Significant Subsidiary is found to be
invalid or any Guarantor that is a Significant Subsidiary
denies its liability under its Guarantee (other than by reason
of release of such Guarantor in accordance with the terms of
this Indenture)."
(h) The following is added to clause (4) of Section 501
of the Original Indenture, after the words "such notice is a "Notice of Default"
hereunder" therein:
"(except in the case of a default with respect to Section 801
hereof, which will constitute an Event of Default with such
notice requirement but without such passage of time
requirement)"
(i) The following is added to the first paragraph of
Section 801 of the Original Indenture, after the words "The Company shall not"
therein:
", in a single transaction or series of related transactions,"
(j) The following is added to the first paragraph of
Section 801 of the Original Indenture, after the words "convey, transfer or
lease" therein:
"or sell or assign or otherwise dispose of (or cause or permit
and Restricted Subsidiary of the Company to sell, assign,
transfer, lease convey or otherwise dispose of)"
(k) The following is added to clause (1) of Section 801
of the Original Indenture, before the words "in case the Company shall
consolidate" therein:
"either (A) the Company shall be the surviving or continuing
corporation or (B)"
(l) The following is added to clause (1) of Section 801
of the Original Indenture, after the words "or the person which acquires by"
therein:
"sale, assignment"
(m) The following is added to clause (1) of Section 801
of the Original Indenture, after the words "or which leases" therein:
"or disposes of in another manner"
(n) The following is added as a new clause (2) to Section
801 of the Original Indenture, and the current clauses (2), (3) and (4) are
renumbered (3), (4) and (5), respectively:
"(2) immediately after giving effect to such transaction
and the assumption contemplated by clause (1) above (including
giving
35
effect to any Indebtedness and Acquired Indebtedness incurred
or anticipated to be incurred in connection with or in respect
of such transaction), the Company or such surviving entity, as
the case may be, (a) shall have a Consolidated Net Worth equal
to or greater than the Consolidated Net Worth of the Company
immediately prior to such transaction and (b) shall be able to
incur at least $1.00 of additional Indebtedness (other than
Permitted Indebtedness) pursuant to paragraph (a) of Section
1014 hereof;"
(o) The following is added to clause (2) of Section 801
of the Original Indenture (which pursuant hereto has been renumbered clause
(3)), after the words "at the time of such transaction" therein:
"and any Lien granted in connection with or in respect of the
transaction"
(p) The following is added to clause (4) of Section 801
of the Original Indenture (which pursuant hereto has been renumbered clause
(5)), after the words "transfer or lease" therein:
", sale, assignment or other disposition"
(q) The following is added to the end of Section 801 of
the Original Indenture, after clause (4) thereof (which pursuant hereto has been
renumbered clause (5)):
"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 of
the Company 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.
Notwithstanding clauses (1), (2) and (3) of the first
paragraph of this Section 801, the Company may merge with an
Affiliate that is a Person that has no material assets or
liabilities and which was organized solely for the purpose of
reorganizing the Company in another jurisdiction.
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 1015 hereof) will not, and the
Company will not cause or permit any Guarantor to, consolidate
with or merge with or into any Person other than the Company
or any other Guarantor unless:
36
(1) 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 existing under
the laws of the United States or any State thereof or the
District of Columbia;
(2) such entity assumes by supplemental
indenture all of the obligations of the Guarantor on the
Guarantee and this Indenture;
(3) immediately after giving effect to such
transaction, no Default or Event of Default shall have
occurred and be continuing; and
(4) immediately after giving effect to such
transaction and the use of any net proceeds therefrom on a pro
forma basis, the Company could satisfy the provisions of
clause (2) of the first paragraph of this Section 801.
Any merger or consolidation of a Restricted Subsidiary with
and into the Company (with the Company being the Surviving
Entity) or another Guarantor need only comply with clause (5)
of the first paragraph, or clause (1) of the fifth paragraph,
as the case may be, of this Section 801."
(r) The following is added to Section 802 of the Original
Indenture, in place of the first occurrence of the words "transfer or lease"
therein:
"transfer, sale, lease, conveyance or other disposition"
(s) The following is added to Section 802 of the Original
Indenture, in place of the words ", except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under this
Indenture, the Securities and the Coupons" therein:
";provided, however, that the predecessor Company shall not be
relieved from the obligation to pay the principal, Purchase
Price or Redemption Price of or interest, if any, on the Notes
except in the case of a sale of all of the Company's assets
that meets the requirements of Section 801 hereof."
(t) The following is added to the end of the first
paragraph of Section 902 and the word "or" at the end of Section 902(3) is
deleted:
"(4) between the date on which a Change of Control or an
Asset Sale giving rise to the Company's obligation to make a
Net Proceeds Offer occurs and the date on which the payments
are made with respect to the related Change of Control Offer
or Net Proceeds Offer, as the case may be, amend, change or
modify in
37
any material respect (A) the obligation of the Company to make
and consummate a Change of Control Offer in the event of a
Change of Control or make and consummate a Net Proceeds Offer
with respect to Asset Sales that have been consummated or (B)
any of the provisions or definitions with respect thereto;
(5) modify or change any provision of this Indenture or
the related definitions affecting the ranking of the Notes or
subordination of any Guarantee in a manner which adversely
affects the Holders in any material respect; or
(6) release any Guarantor that is a Significant
Subsidiary from any of its obligations under its Guarantee or
this Indenture otherwise than in accordance with the terms of
this Indenture.
Notwithstanding anything in this Indenture to the contrary,
any amendment to or waiver of Section 1026 hereof or of the
related terms of the Capital Call Agreement (to the extent
required pursuant to Section 14 thereof) shall require the
consent of the holders of not less than a majority of the
aggregate principal amount of the outstanding Existing Notes
and New Senior Notes, voting as a single class."
(u) The following section is added as a new paragraph to
the end of Section 1004 of the Original Indenture:
"So long as not contrary to the then current recommendations
of the American Institute of Certified Public Accountants, the
year-end financial statements delivered pursuant to Section
1010 above shall be accompanied by a written statement of the
Company's independent public accountants (who shall be a firm
of established national reputation) that in making the
examination necessary for certification of such financial
statements, nothing has come to their attention that would
lead them to believe that the Company has violated any
provisions of Article Ten or Article Eight hereof or, if any
such violation has occurred, specifying the nature and period
of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any
Person for any failure to obtain knowledge of any such
violation."
(v) The following sections are added to Article Ten of
the Original Indenture, after Section 1009:
"Section 1010. Reports. Whether or not required by the rules
and regulations of the Commission, so long as any Notes are
outstanding, the Company will deliver to each Holder, within
the time periods specified in the Commission's rule and
regulations:
38
(i) all quarterly and annual financial information that
would be required to be contained in a filing with the
Commission on Forms 10-Q and 10-K if the Company were required
to file such Forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations"
that describes the financial condition and results of
operations of the Company and its consolidated Subsidiaries
(including a "Management's Discussion and Analysis of
Financial Condition and Results of Operations") and, with
respect to the annual information only, a report thereon by
the Company's certified independent accountants; and
(ii) all current reports that would be required to be
filed with the Commission on Form 8-K if the Company were
required to file such reports, in each case within the time
periods specified in the Commission's rules and regulations.
In addition, following the consummation of the exchange offer
of the New Senior Notes pursuant to a registration statement
contemplated by the Registration Rights Agreement (as defined
in the New Senior Notes Indenture), whether or not required by
the rules and regulations of the Commission, the Company will
file electronically via the Electronic Data Gathering,
Analysis and Retrieval (EDGAR) system or any successor system
maintained by the Commission a copy of all such information
and reports with the Commission for public availability within
the time periods specified in the Commission's rules and
regulations (unless the Commission will not accept such a
filing) and make such information available to securities
analysts and prospective investors upon request. In addition,
the Company has agreed that, for so long as any Notes remain
outstanding, it will furnish to the Holders and to securities
analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.
Section 1011. Stay, Extension and Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any
stay, extension or usury law wherever enacted, now or at any
time hereafter in force, that may affect the covenants or the
performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants it shall
not, by resort to any such law, hinder, delay or impede the
execution of any power herein granted to the Trustee, but
shall suffer and permit the execution of every such power as
though such law has not been enacted.
39
Section 1012. Limitation on Restricted Payments. The
Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly:
(1) declare or pay any dividend or make any distribution
(other than dividends or distributions payable in Qualified
Capital Stock of the Company) on or in respect of shares of
the Company's Capital Stock to holders of such Capital Stock;
(2) 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;
(3) make any principal payment on, purchase, defease,
redeem, prepay, decrease or otherwise acquire or retire for
value, prior to any scheduled final maturity, scheduled
redemption or repayment or scheduled sinking fund payment, any
Subordinated Indebtedness (other than intercompany
Indebtedness among the Company and/or the Guarantors which
Indebtedness was permitted to be incurred pursuant to clause
(6) or (7) of the definition of "Permitted Indebtedness"); or
(4) make any Investment (other than Permitted
Investments)
(each of the foregoing actions set forth in clauses (1), (2),
(3) and (4) 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) the Company is not able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in
compliance with paragraph (a) of Section 1014 hereof; or
(iii) the aggregate amount of Restricted Payments
(including such proposed Restricted Payment) made subsequent
to the Issue Date (the amount expended for such purposes, if
other than in cash, being the fair market value of such
property as determined in good faith by the Board of Directors
of the Company) shall exceed the sum of:
(v) 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 during the period
commencing on and including March 23, 2003 and ending on the
last day of the most recent fiscal quarter for which financial
40
information is available to the Company (treating such period
as a single accounting period); plus
(w) 100% of the aggregate net cash proceeds and the fair
market value (as determined in good faith by the Board of
Directors of the Company) of any asset or property other than
cash received by the Company from any Person (other than a
Subsidiary of the Company) as a contribution to capital or
from the issuance and sale subsequent to the Issue Date and on
or prior to the date such Restricted Payment is made of
Qualified Capital Stock of the Company or warrants, options or
other rights to acquire Qualified Capital Stock of the Company
(but excluding any debt security that is convertible into, or
exchanged for, Qualified Capital Stock until such debt
security has been converted into, or exchanged for, Qualified
Capital Stock); plus
(x) without duplication of any amounts included in clause
(iii)(w) above, 100% of the aggregate net cash proceeds of any
equity contribution received by the Company subsequent to the
Issue Date and on or prior to the date such Restricted Payment
is made from a holder of the Company's Capital Stock
(excluding, in the case of clauses (iii)(w) and (x), any net
cash proceeds from an Equity Offering to the extent used to
redeem the New Senior Notes); plus
(y) 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 and the fair market value (as
determined in good faith by the Board of Directors of the
Company) of any asset or property other than cash received by
the Company or any of its Restricted Subsidiaries 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 amounts included in clauses (1),
(2) and (3) above shall not be included in "Consolidated Net
Income" for purposes of clause (iii)(v) above; plus
(z) $35.0 million.
41
Notwithstanding the foregoing, the provisions set forth in the
immediately preceding paragraph do not prohibit:
(1) the payment of any dividend within 60 days
after the date of declaration of such dividend if the dividend
would have been permitted on the date of declaration;
(2) the acquisition of any shares of Capital
Stock of the Company 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 (other than to a Subsidiary of the Company) of shares
of Qualified Capital Stock of the Company;
(3) the repurchase, redemption or other payment
or an acquisition of any Subordinated Indebtedness 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 (other than to a Subsidiary
of the Company) of (a) shares of Qualified Capital Stock of
the Company for cash or (b) Refinancing Indebtedness;
(4) so long as no Default or Event of Default
shall have occurred and be continuing, dividends or
distributions to Holdings to permit it to repurchase Common
Stock of Holdings or purchases by the Company of Common Stock
of Holdings from employees of Holdings or the Company or any
of its Subsidiaries or their authorized representatives upon
the death, disability or termination of employment of such
employees, in an aggregate amount not to exceed $2.0 million
in any calendar year;
(5) loans, advances, dividends or distributions
by the Company to Holdings not to exceed an amount necessary
to permit Holdings to pay any costs (including, without
limitation, all professional fees and expenses) incurred to
comply with its reporting obligations under federal or state
laws in connection with the Credit Agreement or any other
agreement or instrument relating to Indebtedness of Holdings,
the Company or any Restricted Subsidiary, or otherwise
incurred in connection with compliance with applicable laws or
applicable rules of any governmental, regulatory or
self-regulatory body or stock exchange, including in respect
of reports filed with respect to the Securities Act, the
Exchange Act or the respective rules and regulations
promulgated thereunder and, for so long as Holdings' primary
business is to hold the Capital Stock of the Company, all
other costs incurred by Holdings relating to Holdings'
ownership of the Capital Stock of the Company;
42
(6) payments by the Company to Holdings to pay
(x) any taxes, charges or assessments (other than federal,
state and local income taxes and withholding imposed on
payments made by Holdings) required to be paid by Holdings by
virtue of its being incorporated or having capital stock
outstanding (but not by virtue of owning stock or other equity
interests of any corporation other than the Company or any of
its Subsidiaries), or being a holding company parent of the
Company or receiving actual or, in the case of Subsidiaries of
the Company, deemed dividends from or other distributions in
respect of the stock of the Company or any of its
Subsidiaries, or having guaranteed any obligations of the
Company or any Subsidiary, or having made any payment in
respect of any of the items for which the Company is permitted
to make payments to Holdings pursuant to this covenant or (y)
any other federal, state, foreign, provincial or local taxes
for which Holdings is liable up to an amount not to exceed
with respect to any such taxes the total amount of such taxes
which the Company would have been required to pay on a
separate company basis or on a consolidated basis if the
Company had filed a consolidated return on behalf of an
affiliated group (as defined in Section 1504 of the Internal
Revenue Code of 1986, as amended, or an analogous provision of
state, local or foreign law) of which it were the common
parent, or with respect to state and local taxes, on a
combined basis if the Company had filed a combined return on
behalf of an affiliated group of which it were a member;
(7) payments made to purchase, redeem, defease
or otherwise acquire or retire for value any Subordinated
Indebtedness of the Company pursuant to provisions requiring
the Company to offer to purchase, redeem, defease or otherwise
acquire or retire for value such Subordinated Indebtedness
upon the occurrence of a "change of control" as defined in the
agreements or instruments governing such Subordinated
Indebtedness; provided, however, that the Company has made a
Change of Control Offer and has purchased all Notes tendered
in connection with such Change of Control Offer;
(8) repurchase of Capital Stock deemed to occur
upon exercise of stock options if such Capital Stock
represents a portion of the exercise price of those options;
(9) payments to the Dole Food Company Inc.
Excess Savings Plan or any trust established with respect to
the Dole Food Company Inc. Excess Savings Plan; and
(10) payments made to the holders of Capital
Stock in any Person that is merged or consolidated with or
into the
43
Company or any Restricted Subsidiary pursuant to any merger,
consolidation or sale of assets effected in accordance with
Section 801 hereof; provided, however, that no such payment
may be made pursuant to this clause (10) unless, after giving
pro forma effect to such transaction, and the incurrence of
any Indebtedness in connection with such transaction and the
use of the proceeds from such transaction, the Company would
be able to incur $1.00 of additional Indebtedness under
paragraph (a) of Section 1014 hereof.
In determining the aggregate amount of Restricted Payments
made subsequent to the Issue Date in accordance with clause
(iii) of the second preceding paragraph, amounts expended
pursuant to clauses (1), (2)(ii), (3)(ii)(a) and (4) of the
immediately preceding paragraph shall be included in such
calculation.
Section 1013. Limitation on Dividend and Other Payment
Restrictions Affecting Restricted Subsidiaries. The Company
will not, and will not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise
cause or permit to exist or become effective any consensual
encumbrance or restriction on the ability of any Restricted
Subsidiary of the Company to:
(1) pay dividends or make any other distributions on or
in respect of its Capital Stock;
(2) make loans or advances to the Company or any other
Restricted Subsidiary or to pay any Indebtedness or other
obligation owed to the Company or any other Restricted
Subsidiary of the Company; or
(3) transfer any of its property or assets to the Company
or any other Restricted Subsidiary of the Company,
except in each case for such encumbrances or restrictions
existing under or by reason of:
(a) applicable law or any rule, regulation or order;
(b) the New Senior Notes Indenture, this Indenture, the
New Senior Notes and the related guarantees, and the Existing
Notes and Guarantees;
(c) customary non-assignment provisions or restrictions
on cash or other deposits and net worth covenants contained in
any contract or any lease governing a leasehold interest of
any Restricted Subsidiary of the Company;
44
(d) any agreement or instrument governing Acquired
Indebtedness, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any
Person, other than the Person or the properties or assets of
the Person so acquired;
(e) agreements or instruments existing on the Issue Date
to the extent and in the manner such agreements are in effect
on the Issue Date, including this Indenture;
(f) the Credit Agreement;
(g) an agreement governing Guarantor Senior Debt
permitted to be incurred under this Indenture (other than
Guarantor Senior Debt under, or with respect to, the Credit
Agreement); provided that, with respect to any agreement
governing such Guarantor Senior Debt, the provisions relating
to such encumbrance or restriction are no less favorable to
the Company in any material respect as determined by the Board
of Directors of the Company in its reasonable and good faith
judgment than the provisions contained in the Credit Agreement
as in effect on the Issue Date;
(h) restrictions on the transfer of assets subject to any
Lien permitted under this Indenture imposed by the holder of
such Lien;
(i) restrictions imposed by any agreement to sell assets
or Capital Stock permitted under this Indenture to any Person
pending the closing of such sale;
(j) customary provisions in joint venture agreements and
other similar agreements (in each case relating solely to the
respective joint venture or similar entity or the equity
interests therein) entered into in the ordinary course of
business;
(k) other Indebtedness of Restricted Subsidiaries that
are not Guarantors permitted to be incurred pursuant to an
agreement entered into subsequent to the Issue Date in
accordance with Section 1014 hereof; provided, however, that
the Board of Directors of the Company determines in good faith
at the time such dividend and other payment restrictions are
created that such dividend and other payment restrictions do
not materially adversely affect the Company's ability to pay
principal of, and interest on, the Notes;
(l) purchase money obligations (including any Capitalized
Lease Obligations) relating to property acquired in the
ordinary course of business;
45
(m) Liens securing Indebtedness otherwise permitted to be
incurred under Section 1008 hereof (including clauses (1)
through (10) of Section 1008 hereof) that limit the right of
the debtor to dispose of the assets subject to such Liens; and
(n) an agreement governing Indebtedness incurred to
Refinance the Indebtedness issued, assumed or incurred
pursuant to an agreement referred to in clauses (b), (d), (e)
and (g) through (m) above; provided, however, that the
provisions relating to such encumbrance or restriction
contained in any such Indebtedness are not in the aggregate
materially less favorable to the Company as determined by the
Board of Directors of the Company in their reasonable and good
faith judgment than the provisions relating to such
encumbrance or restriction contained in agreements referred to
in such clauses (b), (d), (e) and (g) through (m).
Section 1014. Limitation on Incurrence of Additional
Indebtedness.
(a) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create,
incur, assume, guarantee, acquire, become liable, contingently
or otherwise, with respect to, or otherwise become responsible
for payment of (collectively, "incur") any Indebtedness (other
than Permitted Indebtedness); provided, however, that if no
Default or Event of Default shall have occurred and be
continuing at the time of or as a consequence of the
incurrence of any such Indebtedness, the Company or any of its
Restricted Subsidiaries that is or, upon such incurrence,
becomes a Guarantor may incur Indebtedness (including, without
limitation, Acquired Indebtedness) and any Restricted
Subsidiary of the Company that is not or will not, upon such
incurrence, become a Guarantor may incur Acquired
Indebtedness, in each case if on the date of the incurrence of
such Indebtedness, after giving effect to the incurrence
thereof, the Consolidated Fixed Charge Coverage Ratio of the
Company is greater than 2.0 to 1.0.
(b) Notwithstanding the preceding paragraph, the Company
will not incur any Indebtedness if such Indebtedness is by its
terms subordinate or junior in right of payment to any other
Indebtedness of the Company, unless such Indebtedness is also
by its terms made subordinate or junior in right of payment to
the Notes to the same extent and in the same manner as such
Indebtedness is subordinated to other Indebtedness of the
Company.
46
Section 1015. Limitation on Asset Sales. (A) The
Company will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(1) the Company or the applicable Restricted Subsidiary,
as the case may be, receives consideration at the time of such
Asset Sale at least equal to the fair market value of the
assets sold or otherwise disposed of (as determined in good
faith by the Company's Board of Directors);
(2) at least 75% of the consideration received by the
Company or the Restricted Subsidiary, as the case may be, from
such Asset Sale shall be in the form of cash, Cash Equivalents
or Replacement Assets and shall be received at the time of
such disposition; provided that:
(a) the amount of any liabilities (as shown on the
Company's or such Restricted Subsidiary's most recent balance
sheet) of the Company or any such Restricted Subsidiary (other
than liabilities that are by their terms subordinated in right
of payment to the Notes or any Guarantee of a Guarantor) that
are assumed by the transferee of any such assets, and
(b) the fair market value of any securities or other
assets received by the Company or any such Restricted
Subsidiary in exchange for any such assets that are converted
into cash within 180 days after such Asset Sale,
shall be deemed to be cash for purposes of this provision; and
(3) upon the consummation of an Asset Sale, the Company
shall apply, or cause such Restricted Subsidiary to apply, the
Net Cash Proceeds relating to such Asset Sale within 365 days
of receipt thereof (provided that if the Company or such
Restricted Subsidiary, as the case may be, has entered into an
agreement in definitive form to so apply such Net Cash
Proceeds, the transaction contemplated by such agreement must
be consummated within the later of such 365 day period and 120
days from the date of the execution of such agreement) either:
(a) to repay any Obligations under the Credit Agreement
or any Guarantor Senior Debt and, in the case of any such
Indebtedness under a revolving credit facility, effect a
permanent reduction in the availability under such revolving
credit facility;
(b) to make an investment in properties and assets that
replace the properties and assets that were the subject of
such Asset Sale or in properties and assets (including Capital
Stock) that will be used
47
in the business of the Company and its Restricted Subsidiaries
as existing on the Issue Date or in businesses reasonably
related thereto ("Replacement Assets"); and/or
(c) a combination of repayment and investment permitted
by the foregoing clauses (3)(a) and (3)(b).
(B) Pending the final application of such Net Cash
Proceeds, the Company may temporarily reduce borrowings under
the Credit Agreement or any other revolving credit facility,
if any. On the 366th day after an Asset Sale or such earlier
date, if any, as the Board of Directors of the Company or of
such Restricted Subsidiary determines not to apply the Net
Cash Proceeds relating to such Asset Sale as set forth in
clauses (3)(a), (3)(b) and (3)(c) of paragraph (A) above or,
in the event that a definitive agreement has been entered into
prior to such 366th day pursuant to which the Net Cash
Proceeds are to be applied, on the later of the 366th day and
the 121st day after the execution of such agreement (each, a
"Net Proceeds Offer Trigger Date"), such aggregate amount of
Net Cash Proceeds which have not been applied on or before
such Net Proceeds Offer Trigger Date as permitted in clauses
(3)(a), (3)(b) and (3)(c) of the preceding paragraph (each a
"Net Proceeds Offer Amount") shall be applied by the Company
or such Restricted Subsidiary to make an offer to purchase
(the "Net Proceeds Offer") to all Holders and, to the extent
required by the terms of any Pari Passu Debt, an offer to
purchase to all holders of such Pari Passu Debt, on a date
(the "Net Proceeds Offer Payment Date") not less than 30 nor
more than 60 days following the applicable Net Proceeds Offer
Trigger Date, from all Holders (and holders of any such Pari
Passu Debt) on a pro rata basis, that amount of Notes (and
Pari Passu Debt) equal to the Net Proceeds Offer Amount at a
price equal to 100% of the principal amount of the Notes (and
Pari Passu Debt) to be purchased, plus accrued and unpaid
interest thereon, if any, to the date of purchase.
(C) If at any time any non-cash consideration received by
the Company or any Restricted Subsidiary of the Company, as
the case may be, in connection with any Asset Sale is
converted into or sold or otherwise disposed of for cash
(other than interest received with respect to any such
non-cash consideration), then such conversion or disposition
shall be deemed to constitute an Asset Sale hereunder as of
the date of such conversion or disposition and the Net Cash
Proceeds thereof shall be applied in accordance with this
Section 1015.
(D) The Company may defer the Net Proceeds Offer until
there is an aggregate unutilized Net Proceeds Offer Amount
equal to or
48
in excess of $15.0 million resulting from one or more Asset
Sales (at which time the entire unutilized Net Proceeds Offer
Amount, and not just the amount in excess of $15.0 million,
shall be applied as required pursuant to this Section 1015).
(E) In the event of the transfer of substantially all
(but not all) of the property and assets of the Company and
its Restricted Subsidiaries as an entirety to a Person in a
transaction permitted under Section 801, which transaction
does not constitute a Change of Control, the successor
corporation shall be deemed to have sold the properties and
assets of the Company and its Restricted Subsidiaries not so
transferred for the 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 its Restricted Subsidiaries deemed to be sold shall be
deemed to be Net Cash Proceeds for purposes of this Section
1015.
(F) If any Net Cash Proceeds remain after the
consummation of any Net Proceeds Offer, the Company may use
such Net Cash Proceeds for any purpose not otherwise
prohibited by this Indenture without regard to this Section
1015. Upon completion of each Net Proceeds Offer, the Net
Proceeds Offer Amount will be reset to zero.
(G) In the event the Company or any of its Restricted
Subsidiaries consummate a single Asset Sale for which the
Company or its Restricted Subsidiaries receive aggregate
consideration at the time of such Asset Sale in excess of
$100.0 million, the Company or such Restricted Subsidiary, as
the case may be, shall, prior to the consummation thereof,
obtain a favorable opinion as to the fairness of such Asset
Sale to the Company or the relevant Restricted Subsidiary, as
the case may be, from a financial point of view, from an
Independent Financial Advisor and file the same with the
Trustee.
(H) Notwithstanding paragraphs (A) and (B) of this
Section 1015, the Company and its Restricted Subsidiaries will
be permitted to enter into and consummate an Asset Swap
without complying with such paragraphs to the extent that:
(1) at the time of entering into such Asset Swap
or immediately after giving effect to such Asset Swap, no
Default or Event of Default shall have occurred or be
continuing or would occur as a consequence thereof, and
49
(2) in the event that such Asset Swap involves
an aggregate amount in excess of $10.0 million, a majority of
the members of the Board of Directors of the Company shall
have approved the terms of such Asset Swap and determined that
the consideration received in such Asset Swap is at least
equal to the fair market value of the assets disposed of in
such Asset Swap.
(I) The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and
regulations thereunder to the extent such laws and regulations
are applicable in connection with the repurchase of Notes
pursuant to a Net Proceeds Offer. To the extent that the
provisions of any securities laws or regulations conflict with
this Section 1015, the Company shall comply with the
applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section
1015 by virtue thereof.
Section 1016. Limitations on Transactions with Affiliates.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into
or permit to exist any transaction or series of related
transactions (including, without limitation, the purchase,
sale, lease or exchange of any property or the rendering of
any service) with, or for the benefit of, any of its
Affiliates (each an "Affiliate Transaction"), other than (x)
Affiliate Transactions permitted under the third paragraph
below or (y) Affiliate Transactions on terms that are no less
favorable than those that might reasonably have been obtained
in a comparable transaction at such time on an arm's-length
basis from a Person that is not an Affiliate of the Company or
such Restricted Subsidiary.
All Affiliate Transactions (and each series of related
Affiliate Transactions which are similar or part of a common
plan) involving aggregate payments with a fair market value in
excess of $7.5 million shall be approved by the Board of
Directors of the Company or such Restricted Subsidiary, as the
case may be, such approval to be evidenced by a Board
Resolution stating that such Board of Directors has determined
that such transaction complies with the foregoing provisions.
If the Company or any Restricted Subsidiary of the Company
enters into an Affiliate Transaction (or a series of related
Affiliate Transactions related to a common plan) that involves
an aggregate fair market value of more than $20.0 million, the
Company or such Restricted Subsidiary, as the case may be,
shall, prior to the consummation thereof, obtain a favorable
opinion as to the fairness of such transaction or series of
related transactions to the Company or the relevant Restricted
Subsidiary, as the case may be, from a financial point of
view,
50
from an Independent Financial Advisor and file the same with
the Trustee.
The restrictions set forth in this Section 1016 shall not
apply to:
(1) reasonable fees and compensation paid to and
indemnity provided on behalf of, officers, directors,
employees or consultants of the Company or any Restricted
Subsidiary of the Company as determined in good faith by the
Company's Board of Directors or senior management;
(2) transactions exclusively between or among the Company
and any of its Restricted Subsidiaries or exclusively between
or among such Restricted Subsidiaries, provided such
transactions are not otherwise prohibited by this Indenture;
(3) any agreement, or any arrangement the terms of which
have been disclosed prior to the Issue Date in the Final
Memorandum, as in effect as of the Issue Date or any amendment
or replacement agreement thereto or any transaction
contemplated thereby (including pursuant to any amendment or
replacement agreement thereto) so long as any such amendment
or replacement agreement taken as a whole is not materially
more disadvantageous to the Holders than the original
agreement as in effect on the Issue Date;
(4) payments and Investments permitted by this Indenture;
(5) the payment of fees and expenses incurred in
connection with the consummation of the transactions being
consummated on the Issue Date;
(6) any issuance of securities, or other payments, awards
or grants in cash, securities or otherwise (other than
issuances, payments, awards or grants to David H. Murdock)
pursuant to, or the funding of, employment arrangements,
employee stock options and employee stock ownership plans
approved by the applicable Board of Directors;
(7) loans or advances to employees in the ordinary course
of business of the Company or any of its Restricted
Subsidiaries consistent with the past practice;
(8) transactions with customers, clients, vendors,
suppliers or other purchasers or sellers of goods or services,
in each case in the ordinary course of business (including,
without limitation, pursuant to joint venture agreements) and
otherwise in compliance with the terms of this Indenture;
51
(9) any transaction on arm's-length terms with any
non-Affiliate that becomes an Affiliate as a result of such
transaction;
(10) purchases and sales of product and raw materials,
insurance arrangements and payments, all of the foregoing in
the ordinary course of business consistent with past practice
or as may be necessary to accommodate legal, regulatory or
other changes in the business of the Company and its
Restricted Subsidiaries;
(11) employment agreements and similar arrangements with
employees and independent contractors other than David H.
Murdock;
(12) the issuance and sale of Qualified Capital Stock; and
(13) payments made pursuant to the following conditions:
if the Company is to file consolidated federal income tax
returns with Holdings or combined or unitary state income tax
returns with Holdings, the Company may enter into a tax
sharing agreement with Holdings and may pay to Holdings
amounts when due and payable pursuant to such tax sharing
agreement in respect of amounts of tax due with respect to
such consolidated, combined or unitary returns and any
additional taxes due from time to time as a result of any
audit thereof, as the case may be, in each case in an amount
not to exceed the amount of tax that the Company would have
been obligated to pay to the appropriate taxing authority if
the Company and its Subsidiaries had filed a hypothetical
separate consolidated, combined or unitary return for the then
current year and all prior years ending after the Issue Date.
Section 1017. Continued Existence. Subject to Article
Eight hereof, 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 (i) its corporate or other existence
in accordance with the organizational documents (as the same
may be amended from time to time) of the Company or such
Guarantor and (ii) the material rights (charter and
statutory), licenses and franchises of the Company or such
Guarantor, except to the extent that the applicable Board of
Directors determines in good faith that the preservation of
such right, license or franchise is no longer necessary or
desirable in the conduct of the business of the Company or
such Guarantor and that the loss thereof is not
disadvantageous in any material respect to the Holders.
Section 1018. Insurance Matters. The Company shall provide
or cause to be provided, for itself and each of its
Subsidiaries, insurance (including appropriate self-insurance)
against loss or
52
damage of the kinds that, in the reasonable, good faith
opinion of the Company, are adequate and appropriate for the
conduct of the business of the Company and its 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 either (i)
consistent with past practices of the Company or the
applicable Subsidiary or (ii) customary, in the reasonable,
good faith opinion of the Company, for corporations 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 the Company and its Subsidiaries,
taken as a whole.
Section 1019. Offer to Repurchase upon Change of Control.
Upon the occurrence of a Change of Control, each Holder of
Notes shall have the right to require the Company to
repurchase all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Notes (a "Change of Control
Offer") at a Purchase Price in cash equal to 101% of the
aggregate principal amount thereof, together with accrued and
unpaid interest, if any, thereon to the Purchase Date. The
Change of Control Offer shall be made in compliance with the
applicable procedures set forth in Article Eleven hereof and
shall include all instructions and materials necessary to
enable Holders to tender their Notes.
The Company will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the
Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements set forth in
this Indenture applicable to a Change of Control Offer made by
the Company and purchases all Notes validly tendered and not
withdrawn under such Change of Control Offer.
The Company will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and
regulations to the extent such laws and regulations are
applicable in connection with the repurchase of Notes pursuant
to a Change of Control Offer. To the extent that the
provisions of any securities laws or regulations conflict with
this Section 1019, the Company shall comply with the
applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section
1019 by virtue hereof.
Section 1020. Additional Subsidiary Guarantees. If the
Company or any of its Restricted Subsidiaries transfers or
causes to be transferred, in one transaction or a series of
related transactions,
53
any property to any Domestic Restricted Subsidiary that is a
Wholly Owned Restricted Subsidiary and that is not a
Guarantor, or if the Company or any of its Restricted
Subsidiaries shall organize, acquire or otherwise invest in
another Domestic Restricted Subsidiary that is a Wholly Owned
Restricted Subsidiary, in either case, after giving effect to
such transfer or other such event, having total assets with a
book value in excess of $2.5 million, then such transferee or
acquired or other Restricted Subsidiary shall, within 15
Business Days of such organization, acquisition or investment:
(1) 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 on a senior subordinated basis all
of the Company's obligations under the Notes and this
Indenture on the terms set forth in this Indenture (provided
that such Guarantee shall be limited as necessary to prevent
such Guarantee from constituting a fraudulent conveyance or
fraudulent transfer under applicable law); and
(2) 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 (until released from its
Guarantee in accordance with the terms of this Indenture).
Section 1021. Conduct of Business. The Company and its
Restricted Subsidiaries will not engage in any businesses
which are not the same, similar, ancillary or reasonably
related to the businesses in which the Company and its
Restricted Subsidiaries are currently engaged on the Issue
Date or which are contemplated in the Final Memorandum except
to such extent as is not material to the Company and its
Restricted Subsidiaries taken as a whole, or with respect to
businesses acquired by the Company or its Restricted
Subsidiaries that are intended to be disposed of within a
reasonable time after the acquisition thereof.
Section 1022. Payments for Consent. The Company will not,
and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for
or as an inducement to any consent, waiver or amendment of any
of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to
54
be paid and is paid to all Holders of the Notes that consent,
waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or
agreement.
Section 1023. Limitation on Issuance of Preferred Stock of
Restricted Subsidiaries. The Company will not permit any of
its Restricted Subsidiaries that are not Guarantors to issue
any Preferred Stock (other than to the Company or to a Wholly
Owned Restricted Subsidiary of the Company) or permit any
Person (other than the Company or a Wholly Owned Restricted
Subsidiary of the Company) to own any Preferred Stock of any
Restricted Subsidiary of the Company that is not a Guarantor.
Section 1024. Prohibition on Incurrence of Senior
Subordinated Guarantees. The Company will not permit any
Restricted Subsidiary that is a Guarantor to incur or suffer
to exist Indebtedness that is senior in right of payment to
such Guarantor's Guarantee and subordinate in right of payment
to any other Indebtedness of such Guarantor.
Section 1025. Limitation of Guarantees by Restricted
Subsidiaries. The Company will not permit any Restricted
Subsidiary that is not a Guarantor, directly or indirectly, by
way of the pledge of any intercompany note or otherwise, to
assume, guarantee or in any other manner become liable with
respect to any Indebtedness of the Company or any other
Restricted Subsidiary of the Company (other than: (1)
Indebtedness or other obligations under the Credit Agreement;
(2) Permitted Indebtedness of a Restricted Subsidiary of the
Company; (3) Indebtedness under Currency Agreements in
reliance on clause (5) of the definition of Permitted
Indebtedness; or (4) Interest Swap Obligations incurred in
reliance on clause (4) of the definition of Permitted
Indebtedness), unless, in any such case, such Restricted
Subsidiary executes and delivers a supplemental indenture to
this Indenture providing a senior subordinated guarantee of
payment of the Notes by such Restricted Subsidiary.
Notwithstanding the foregoing, any such Guarantee by a
Restricted Subsidiary of the Notes shall provide by its terms
that it shall be automatically and unconditionally released
and discharged, without any further action required on the
part of the Trustee or any Holder, upon: the unconditional
release of such Restricted Subsidiary from its liability in
respect of the Indebtedness in connection with which such
Guarantee was executed and delivered pursuant to this
paragraph; if the Company designates any Restricted Subsidiary
that is a Guarantor to be an Unrestricted Subsidiary in
accordance with the applicable provisions of this Indenture;
or any sale or other disposition (by merger or otherwise) to
any Person which is not a Restricted
55
Subsidiary of the Company of all of the Company's Capital
Stock in, or all or substantially all of the assets of, such
Restricted Subsidiary; provided that (a) such sale or
disposition of such Capital Stock or assets is otherwise in
compliance with the terms of this Indenture and (b) such
assumption, guarantee or other liability of such Restricted
Subsidiary has been released by the holders of the other
Indebtedness so guaranteed.
Section 1026. Capital Call Agreement. The Company shall
have received the net cash proceeds from the equity
contribution or purchase of its Capital Stock, as the case may
be, to the extent required by, and upon the terms of, Section
2 (only to the extent such Section relates to the consolidated
leverage ratio (as defined therein) requirement with respect
to the four full fiscal quarter period commencing on March 23,
2003) of the Capital Call Agreement as in effect on the Issue
Date and shall use such net cash proceeds to repay
Indebtedness and/or purchase subordinated participations in
obligations under the Credit Agreement, in each case, in
compliance with the Capital Call Agreement as in effect on the
Issue Date."
(w) The following paragraph is added to Section 1102 of
the Original Indenture, at the end of such section:
"If the Company is required to offer to repurchase Notes
pursuant to the provisions of Section 4.15 or 4.19 hereof, it
shall notify the Trustee in writing, at least 30 days but not
more than 60 days before the Purchase Date, of the Section of
this Indenture pursuant to which the repurchase shall occur,
the Purchase Date, the principal amount of Notes required to
be repurchased and the Purchase Price and shall furnish to the
Trustee an Officers' Certificate to the effect that (a) the
Company is required to make or has made a Net Proceeds Offer
or a Change of Control Offer, as the case may be, and (b) the
conditions set forth in Section 4.15 or 4.19 hereof, as the
case may be, have been satisfied."
(x) The following Articles Fifteen and Sixteen are added
to the Original Indenture, after Article Fourteen thereof:
"ARTICLE FIFTEEN. SUBORDINATION OF THE GUARANTEES
Section 1501. Guarantees Subordinated to Guarantor Senior
Debt. Anything herein to the contrary notwithstanding, each of
the Company and the Guarantors, for itself and its successors,
and each Holder, by his or her acceptance of Guarantees,
agrees that the payment by the Guarantors of all Obligations
with respect to
56
the Guarantees is subordinated in right of payment to the
prior payment in full in cash or Cash Equivalents of all
Obligations on Guarantor Senior Debt (including all
Obligations with respect to the Credit Agreement).
Notwithstanding the foregoing, payments and distributions made
relating to the Guarantees pursuant to the trust described
under Article Thirteen hereof shall not be so subordinated in
right of payment so long as the payments into the trust were
made in accordance with the requirements described under
Article Thirteen hereof and did not violate the subordination
provisions when they were made.
This Article Fifteen shall constitute a continuing offer to
all Persons who become holders of, or continue to hold,
Guarantor Senior Debt, and such provisions are made for the
benefit of the holders of Guarantor Senior Debt and such
holders are made obligees hereunder and any one or more of
them may enforce such provisions. Each such holder shall be
deemed to have acquired such Guarantor Senior Debt in reliance
upon the covenants and provisions contained in this Article
Fifteen.
Section 1502. Suspension of Payment When Guarantor Senior
Debt Is in Default. (a) Unless Section 1503 shall be
applicable, if any default occurs and is continuing in the
payment when due (and such default has not been cured or
waived), whether at maturity, upon any redemption, by
declaration or otherwise, of any principal of, premium (if
any) or interest on, unpaid drawings for letters of credit
issued in respect of, unreimbursed payments with respect to
bank guarantees issued in respect of or regularly accruing
fees with respect to, any Guarantor Senior Debt (a "Payment
Default"), then no payment or distribution of any kind or
character shall be made by or on behalf of any Guarantor or
any other Person on its or their behalf with respect to any
Obligations on or relating to the Guarantees or to acquire any
Notes for cash or property or otherwise.
(b) Unless Section 1503 shall be applicable, if any other
event of default (other than a Payment Default) occurs and is
continuing with respect to any Guarantor Designated Senior
Debt (as such event of default is defined in the instrument
creating or evidencing such Guarantor Designated Senior Debt)
permitting the holders of such Guarantor Designated Senior
Debt then outstanding to accelerate the maturity thereof (a
"Non-payment Default") and if the Representative for the
respective issue of Guarantor Designated Senior Debt gives
notice of the event of default to the Trustee stating that
such notice is a payment blockage notice (a "Payment Blockage
Notice"), then, unless and until all events of default have
been cured or waived or have ceased to exist or a Responsible
57
Officer of the Trustee receives at the Corporate Trust Office
of the Trustee written notice thereof from the Representative
for the respective issue of Guarantor Designated Senior Debt
terminating the Payment Blockage Period, during the 180 days
after the delivery of such Payment Blockage Notice (the
"Payment Blockage Period"), neither any Guarantor nor any
other Person on its behalf shall (x) make any payment or
distribution of any kind or character with respect to any
Obligations on or with respect to the Guarantees or (y)
acquire any of the Notes for cash or property or otherwise.
Notwithstanding anything herein to the contrary, (x) in no
event will a Payment Blockage Period extend beyond 180 days
from the date the applicable Payment Blockage Notice is
received by the Trustee and (y) no new Payment Blockage Notice
may be delivered unless and until 360 days have elapsed since
the effectiveness of the immediately prior Payment Blockage
Notice. For all purposes of this Section 1502(b), no event of
default which existed or was continuing on the date of the
commencement of any Payment Blockage Period with respect to
the Guarantor Designated Senior Debt shall be, or be made, the
basis for the commencement of a second Payment Blockage Period
by the Representative of such Guarantor Designated Senior Debt
whether or not within a period of 360 days, unless such event
of default shall have been cured or waived for a period of not
less than 90 consecutive days (it being acknowledged that any
subsequent action, or any breach of any financial covenants
for a period commencing after the date of commencement of such
Payment Blockage Period that, in either case, would give rise
to an event of default pursuant to any provisions under which
an event of default previously existed or was continuing shall
constitute a new event of default for this purpose).
(c) In the event that, notwithstanding the foregoing, any
payment shall be received by the Trustee or any Holder when
such payment is prohibited by the foregoing provisions of this
Section 1502, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the
holders of Guarantor Senior Debt (pro rata to such holders on
the basis of the respective amount of Senior Debt held by such
holders) or their respective Representatives, as their
respective interests may appear. The Trustee shall be entitled
to rely on information regarding amounts then due and owing on
the Guarantor Senior Debt, if any, received from the holders
of Guarantor Senior Debt (or their Representatives) or, if
such in-formation is not received from such holders or their
Representatives, from the Company and only amounts included in
the information provided to the Trustee shall be paid to the
holders of Guarantor Senior Debt.
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If payment of the Notes and Guarantees is accelerated because
of an Event of Default, the Guarantors or the Trustee shall
promptly notify the holders of the Guarantor Senior Debt or
the Representative of such holders of the acceleration;
provided that any failure to give such notice shall have no
effect whatsoever on the subordination provisions contained
herein. If any Guarantor Senior Debt is outstanding, such
acceleration will not be effective until the time specified in
Section 502.
Nothing contained in this Article Fifteen shall limit the
right of the Trustee or the Holders of Notes to take any
action to accelerate the maturity of the Notes pursuant to
Section 502 or to pursue any rights or remedies hereunder
(subject, however, to the rights, if any, under this Article
Fifteen, of the holders of Guarantor Senior Debt in respect of
cash or other property of a Guarantor received upon the
exercise of any such remedy); provided that all Guarantor
Senior Debt thereafter due or declared to be due shall first
be paid in full in cash or Cash Equivalents before the Holders
are entitled to receive any payment of any kind or character
with respect to Obligations on, or with respect to, the
Guarantees.
Section 1503. Guarantees Subordinated to Prior Payment of
All Guarantor Senior Debt on Dissolution, Liquidation or
Reorganization of the Guarantors. (a) Upon any payment or
distribution of assets of any Guarantor of any kind or
character, whether in cash, property or securities, to
creditors upon any total or partial liquidation, dissolution,
winding up, reorganization, assignment for the benefit of
creditors or marshaling of assets of any Guarantor or in a
bankruptcy, reorganization, insolvency, receivership or other
similar proceeding relating to any Guarantor or its property,
whether voluntary or involuntary, all Obligations due or to
become due upon all Guarantor Senior Debt shall first be paid
in full in cash or Cash Equivalents (including interest after
the commencement of any bankruptcy or other like proceeding at
the rate specified in the applicable Guarantor Senior Debt,
whether or not such interest is an allowed claim in any such
proceeding), before any payment or distribution of any kind or
character is made on account of any Obligations on or relating
to the Guarantees, or for the acquisition of any of the Notes
for cash or property or otherwise. Upon any such dissolution,
winding-up, liquidation, reorganization, receivership or
similar proceeding, any payment or distribution of assets of
any Guarantor of any kind or character, whether in cash,
property or securities, to which the Holders of the Notes or
the Trustee under this Indenture would be entitled, except for
the provisions hereof, shall be paid by the Guarantor or by
any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution,
59
or by the Holders or by the Trustee under this Indenture if
received by them, directly to the holders of Guarantor Senior
Debt (pro rata to such holders on the basis of the respective
amounts of Guarantor Senior Debt held by such holders) or
their respective Representatives, or to the trustee or
trustees under any indenture pursuant to which any of such
Guarantor Senior Debt may have been issued, as their
respective interests may appear, for application to the
payment of Guarantor Senior Debt remaining unpaid until all
such Guarantor Senior Debt has been paid in full in cash or
Cash Equivalents after giving effect to any concurrent
payment, distribution or provision therefor to or for the
holders of Guarantor Senior Debt.
(b) To the extent any payment of Guarantor Senior Debt
(whether by or on behalf of any Guarantor, as proceeds of
security or enforcement of any right of set-off or otherwise)
is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy,
liquidating trustee, agent or other similar Person under any
bankruptcy, insolvency, receivership, fraudulent conveyance or
similar law, then, if such payment is recovered by, or paid
over to, such receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person, the Guarantor Senior
Debt or part thereof originally intended to be satisfied shall
be deemed to be reinstated and outstanding as if such payment
had not occurred. It is further agreed that any diminution
(whether pursuant to court decree or otherwise, including
without limitation for any of the reasons described in the
preceding paragraph) of any Guarantor's obligation to make any
distribution or payment pursuant to any Guarantor Senior Debt,
except to the extent such diminution occurs by reason of the
repayment (which has not been disgorged or returned) of such
Guarantor Senior Debt in cash or Cash Equivalents, shall have
no force or effect for purposes of the subordination
provisions contained in this Article Fifteen, with any
turnover of payments as otherwise calculated pursuant to this
Article Fifteen to be made as if no such diminution had
occurred.
(c) In the event that, notwithstanding the foregoing, any
payment or distribution of assets of any Guarantor of any kind
or character, whether in cash, property or securities, shall
be received by the Trustee or any Holder when such payment or
distribution is prohibited by this Section 1503, such payment
or distribution shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Guarantor
Senior Debt (pro rata to such holders on the basis of the
respective amount of Guarantor Senior Debt held by such
holders) or their respective Representatives, or to the
trustee or trustees under any indenture pursuant to which any
of such Guarantor Senior Debt may have been issued, as their
60
respective interests may appear, for application to the
payment of Guarantor Senior Debt remaining unpaid until all
such Guarantor Senior Debt has been paid in full in cash or
Cash Equivalents, after giving effect to any concurrent
payment, distribution or provision therefor to or for the
holders of such Guarantor Senior Debt.
(d) The consolidation of any Guarantor with, or the
merger of any Guarantor with or into, another Person or the
liquidation or dissolution of any Guarantor following the
conveyance or transfer of all or substantially all of its
assets, to another Person upon the terms and conditions
provided in Article Eight hereof and as long as permitted
under the terms of the Guarantor Senior Debt shall not be
deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section 1503 if such
other Person shall, as a part of such consolidation, merger,
conveyance or transfer, assume the Guarantor's obligations
hereunder in accordance with Article Eight hereof.
Section 1504. Payments May Be Paid Prior to Dissolution.
Nothing contained in this Article Fifteen or elsewhere in this
Indenture shall prevent (i) the Guarantors, except under the
conditions described in Sections 1502 and 1503, from making
payments at any time for the purpose of making payments of
principal of and interest on the Notes, or from depositing
with the Trustee any moneys for such payments, or (ii) in the
absence of actual knowledge by a Responsible Officer of the
Trustee that a given payment would be prohibited by Section
1502 or 1503, the application by the Trustee of any moneys
deposited with it for the purpose of making such payments of
principal of, and interest on, the Notes to the Holders
entitled thereto unless at least two Business Days prior to
the date upon which such payment would otherwise become due
and payable a Responsible Officer shall have actually received
the written notice provided for in the first sentence of
Section 1502(b) or in Section 1507 or in the last sentence of
this Section 1504 (provided that, notwithstanding the
foregoing, the subordination of the Guarantees to Guarantor
Senior Debt shall not be affected and the Holders receiving
any payments made in contravention of Section 1502 and/or 1503
(and the respective such payments) shall otherwise be subject
to the provisions of this Article Fifteen). The Company shall
give prompt written notice to the Trustee of any dissolution,
winding-up, liquidation or reorganization of any Guarantor,
although any delay or failure to give any such notice shall
have no effect on the subordination provisions contained
herein.
Section 1505. Holders To Be Subrogated to Rights of
Holders of Guarantor Senior Debt. Subject to the payment in
full in cash or
61
Cash Equivalents of all Guarantor Senior Debt, the Holders of
the Guarantees shall be subrogated to the rights of the
holders of Guarantor Senior Debt to receive payments or
distributions of cash, property or securities of any Guarantor
applicable to the Guarantor Senior Debt until the Notes shall
be paid in full; and, for the purposes of such subrogation, no
such payments or distributions to the holders of the Guarantor
Senior Debt by or on behalf of any Guarantor, or by or on
behalf of the Holders by virtue of this Article Fifteen, which
otherwise would have been made to the Holders shall, as
between any Guarantor and the Holders, be deemed to be a
payment by any Guarantor to or on account of the Guarantor
Senior Debt, it being understood that the provisions of this
Article Fifteen are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand,
and the holders of Guarantor Senior Debt, on the other hand.
Section 1506. Obligations of Guarantors Unconditional.
Nothing contained in this Article Fifteen or elsewhere in this
Indenture or in the Guarantees is intended to or shall impair,
as among the Guarantors, its creditors other than the holders
of Guarantor Senior Debt, and the Holders, the obligation of
the Guarantors, which is absolute and unconditional, to pay to
the Holders the principal of and any interest on the Notes as
and when the same shall become due and payable in accordance
with their terms, or is intended to or shall affect the
relative rights of the Holders and creditors of the Guarantors
other than the holders of the Guarantor Senior Debt, nor shall
anything herein or therein prevent the Holder of any Guarantee
or the Trustee on its behalf from exercising all remedies
otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, in respect of cash,
property or securities of any Guarantor received upon the
exercise of any such remedy.
Section 1507. Notice to Trustee. The Company shall give
prompt written notice to the Trustee of any fact known to the
Company which would prohibit the making of any payment to or
by the Trustee in respect of the Guarantees pursuant to the
provisions of this Article Fifteen, although any delay or
failure to give any such notice shall have no effect on the
subordination provisions contained herein. Regardless of
anything to the contrary contained in this Article Fifteen or
elsewhere in this Indenture, the Trustee shall not be charged
with knowledge of the existence of any default or event of
default with respect to any Guarantor Senior Debt or of any
other facts which would prohibit the making of any payment to
or by the Trustee unless and until a Responsible Officer of
the Trustee shall have received at the Corporate Trust Office
of the Trustee notice in writing from the Company or from a
62
holder of Guarantor Senior Debt or a Representative therefor
and, prior to the receipt of any such written notice, the
Trustee shall be entitled to assume that no such facts exist
(provided that, notwithstanding the foregoing, the Holders of
the Guarantees receiving any payments made in contravention of
Section 1502 and/or 1503 hereof (and the respective such
payments) shall otherwise be subject to the provisions of this
Article Fifteen). The Trustee shall be entitled to rely on the
delivery to it of any notice pursuant to this Section 1507 to
establish that such notice has been given by a holder of
Guarantor Senior Debt (or a Representative thereof).
In the event that the Trustee determines in good faith that
any evidence is required with respect to the right of any
Person as a holder of Guarantor Senior Debt to participate in
any payment or distribution pursuant to this Article Fifteen,
the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amounts of
Guarantor Senior Debt held by such Person, the extent to which
such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of
such Person under this Article Fifteen, and if such evidence
is not furnished the Trustee may defer any payment to such
Person pending judicial determination as to the right of such
Person to receive such payment.
Section 1508. Reliance on Judicial Order or Certificate of
Liquidating Agent. Upon any payment or distribution of assets
of any Guarantor referred to in this Article Fifteen, the
Trustee, subject to the provisions of Article Six hereof, and
the Holders of the Guarantees shall be entitled to rely upon
any order or decree made by any court of competent
jurisdiction in which any insolvency, bankruptcy,
receivership, dissolution, winding-up, liquidation,
reorganization or similar case or proceeding is pending, or
upon a certificate of the receiver, trustee in bankruptcy,
liquidating trustee, assignee for the benefit of creditors,
agent or other person making such payment or distribution,
delivered to the Trustee or the Holders of the Guarantees, for
the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of
the Guarantor Senior Debt and other Indebtedness of the
Guarantors, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article Fifteen.
Section 1509. Trustee's Relation to Guarantor Senior Debt.
The Trustee and any agent of the Guarantors or the Trustee
shall be entitled to all the rights set forth in this Article
Fifteen with respect to any Guarantor Senior Debt which may at
any time be held by it
63
in its individual or any other capacity to the same extent as
any other holder of Guarantor Senior Debt and nothing in this
Indenture shall deprive the Trustee or any such agent of any
of its rights as such holder.
With respect to the holders of Guarantor Senior Debt, the
Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in
this Article Fifteen, and no implied covenants or obligations
with respect to the holders of Guarantor Senior Debt shall be
read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders
of Guarantor Senior Debt.
Whenever a distribution is to be made or a notice given to
holders or owners of Guarantor Senior Debt, the distribution
may be made and the notice may be given to their
Representative, if any.
Section 1510. Subordination Rights Not Impaired by Acts or
Omissions of the Guarantors or Holders of Guarantor Senior
Debt. No right of any present or future holders of any
Guarantor Senior Debt to enforce subordination as provided
herein shall at any time in any way be prejudiced or impaired
by any act or failure to act on the part of the Guarantors or
by any act or failure to act by any such holder, or by any
noncompliance by the Guarantors with the terms of this
Indenture, regardless of any knowledge thereof which any such
holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Guarantor Senior Debt may, at any
time and from time to time, without the consent of or notice
to the Trustee or the Holders of the Guarantees, without
incurring responsibility to the Trustee or the Holders of the
Guarantees and without impairing or releasing the
subordination provided in this Article Fifteen or the
obligations hereunder of the Holders of the Guarantees to the
holders of the Guarantor Senior Debt, do any one or more of
the following: (i) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter,
Guarantor Senior Debt, or otherwise amend or supplement in any
manner Guarantor Senior Debt, or any instrument evidencing the
same or any agreement under which Guarantor Senior Debt is
outstanding; (ii) sell, exchange, release or otherwise deal
with any property pledged, mortgaged or other-wise securing
Guarantor Senior Debt; (iii) release any Person liable in any
manner for the payment or collection of Guarantor Senior Debt;
and (iv) exercise or refrain from exercising any rights
against the Guarantors and any other Person.
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Section 1511. Securityholders Authorize Trustee To
Effectuate Subordination of Guarantees. Each Holder of
Guarantees by its acceptance of them authorizes and expressly
directs the Trustee on its behalf to take such action as may
be necessary or appropriate to effectuate, as between the
holders of Guarantor Senior Debt and the Holders of
Guarantees, the subordination provided in this Article
Fifteen, and appoints the Trustee its attorney-in-fact for
such purposes, including, in the event of any dissolution,
winding-up, liquidation or reorganization of any Guarantor
(whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment
for the benefit of credits or otherwise) tending towards
liquidation of the business and assets of any Guarantor, the
filing of a claim for the unpaid balance of its Guarantees and
accrued interest in the form required in those proceedings.
If the Trustee does not file a proper claim or proof of debt
in the form required in such proceeding prior to 30 days
before the expiration of the time to file such claim or
claims, then the holders of the Guarantor Senior Debt or their
Representative are or is hereby authorized to have the right
to file and are or is hereby authorized to file an appropriate
claim for and on behalf of the Holders of said Guarantees.
Nothing herein contained shall be deemed to authorize the
Trustee or the holders of Guarantor Senior Debt or their
Representative to authorize or consent to or accept or adopt
on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the
Guarantees or the rights of any Holder thereof, or to
authorize the Trustee or the holders of Guarantor Senior Debt
or their Representative to vote in respect of the claim of any
Holder in any such proceeding.
Section 1512. This Article Fifteen Not To Prevent Events
of Default. The failure to make a payment on account of
principal of or interest on the Notes by reason of any
provision of this Article Fifteen will not be construed as
preventing the occurrence of an Event of Default.
Section 1513. Trustee's Compensation Not Prejudiced.
Nothing in this Article Fifteen will apply to amounts due to
the Trustee pursuant to other sections of this Indenture.
ARTICLE SIXTEEN. GUARANTEE
Section 1601. Unconditional Guarantee. Each Guarantor
hereby unconditionally guarantees (such guarantee to be
referred to herein as a "Guarantee"), on a senior subordinated
basis jointly and severally, to each Holder of a Note
authenticated and delivered by
65
the Trustee and to the Trustee and its successors and assigns,
the Notes or the obligations of the Company hereunder or
thereunder, that: (i) the principal of and interest on the
Notes will be promptly paid in full when due, subject to any
applicable grace period, whether at maturity, by acceleration
or otherwise and interest on the overdue principal, if any,
and interest on any interest, to the extent lawful, of the
Notes and all other obligations of the Company to the Holders
or the Trustee hereunder or thereunder will be promptly paid
in full or performed, all in accordance with the terms hereof
and thereof; and (ii) in case of any extension of time of
payment or renewal of any Notes or of any such other
obligations, the same will be promptly paid in full when due
or performed in accordance with the terms of the extension or
renewal, subject to any applicable grace period, whether at
stated maturity, by acceleration or otherwise, subject,
however, in the case of clauses (i) and (ii) above, to the
limitations set forth in Section 1603. Each Guarantor hereby
agrees that its obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of
the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the
Notes with respect to any provisions hereof or thereof, the
recovery of any judgment against the Company, and action to
enforce the same or any other circumstance which might
otherwise constitute a legal or equitable discharge or defense
of a guarantor. Each Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court
in the event of insolvency or bankruptcy of the Company, any
right to require a proceeding first against the Company,
protest, notice and all demands whatsoever and covenants that
this Guarantee will not be discharged except by complete
performance of the obligations contained in the Notes, this
Indenture and in this Guarantee. If any Holder or the Trustee
is required by any court or otherwise to return to the
Company, any Guarantor, or any custodian, trustee, liquidator
or other similar official acting in relation to the Company or
any Guarantor, any amount paid by the Company or any 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 each
Guarantor, on the one hand, and the Holders and the Trustee,
on the other hand, (x) the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article
Five for the purposes of this Guarantee, notwithstanding any
stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby,
and (y) in the event of any acceleration of such obligations
as provided in Article Five, such obligations (whether or not
due and payable) shall forthwith
66
become due and payable by each Guarantor for the purpose of
this Guarantee. The obligations of each Guarantor to the
Holders of the Guarantees and to the Trustee pursuant to the
Guarantee of such Guarantor and this Indenture are expressly
subordinate and subject in right of payment to the prior
payment in full in cash or Cash Equivalents of all Guarantor
Senior Debt of such Guarantor, to the extent and in the manner
provided in Article Fifteen hereof.
Section 1602. Severability. In case any provision of this
Guarantee shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired
thereby.
Section 1603. Limitation of Guarantor's Liability. Each
Guarantor and by its acceptance hereof each Holder hereby
confirms that it is the intention of all such parties that the
guarantee by such Guarantor pursuant to its Guarantee not
constitute a fraudulent transfer or conveyance for purposes of
any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
Uniform Fraudulent Transfer Act or any similar federal or
state law. To effectuate the foregoing intention, the Holders
and such Guarantor hereby irrevocably agree that the
obligations of such Guarantor under the Guarantee shall be
limited to the maximum amount as will, after giving effect to
all other contingent and fixed liabilities of such Guarantor
(including, without limitation, all Guarantor Senior Debt 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, result in the obligations of such Guarantor
under the Guarantee not constituting such fraudulent transfer
or conveyance.
Section 1604. Release of Guarantor. (a) The Guarantee of a
Guarantor will be automatically and unconditionally released
without any action on the part of the Trustee or the Holders
of the Notes: (1) in connection with any sale or other
disposition of all or substantially all of the assets of that
Guarantor (including, without limitation, by way of merger or
consolidation), if the Company applies the Net Cash Proceeds
of that sale or other disposition in accordance with the
applicable provisions of this Indenture; (2) in the event all
of the Capital Stock of a Guarantor is sold by the Company in
compliance with clauses (1) and (2) of Section 1015(A) hereof,
if the Company applies the Net Cash Proceeds of that sale in
accordance with the applicable provisions of this Indenture;
(3) if the Company designates a Restricted Subsidiary that is
a Guarantor as an Unrestricted Subsidiary in
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accordance with the applicable provisions of this Indenture;
or (4) upon the payment in full of the Notes.
In addition, concurrently with any Legal Defeasance or
Covenant Defeasance, the Guarantors shall be released from all
of their Obligations under their respective applicable
Guarantees.
(b) The Trustee shall deliver an appropriate instrument
evidencing such re-lease upon receipt of a request by the
Company accompanied by an Officers' Certificate and Opinion of
Counsel certifying as to the compliance with this Section
1604.
Section 1605. Immediate Payment. Each Guarantor agrees to
make immediate payment to the Trustee on behalf of the Holders
of all Obligations due and owing or payable to the respective
Holders upon receipt of a demand for payment therefor by the
Trustee to such Guarantor in writing.
Section 1606. Waiver of Subrogation. Until all Obligations
are paid in full, each Guarantor hereby irrevocably waives any
claims or other rights which it may now or hereafter acquire
against the Company that arise from the existence, payment,
performance or enforcement of such Guarantor's obligations
under the Guarantee and this Indenture, including, without
limitation, any right of subrogation, reimbursement,
exoneration, indemnification, and any right to participate in
any claim or remedy of any Holder 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 the
Notes shall not have been paid in full, such amount shall have
been deemed to have been paid to such Guarantor for the
benefit of, and held in trust for the benefit of, the Holders,
and shall, subject to the provisions of Article Fifteen
hereof, forthwith be paid to the Trustee for the benefit of
such Holders to be credited and applied upon the Notes,
whether matured or unmatured, in accordance with the terms of
this Indenture. Each Guarantor acknowledges that it will
receive direct and indirect benefits from the financing
arrangements contemplated by this Indenture and that the
waiver set forth in this Section 1606 is knowingly made in
contemplation of such benefits.
Section 1607. Execution of Guarantee. To evidence their
guarantee to the Holders set forth in this Article Sixteen,
the Guarantors hereby agree to execute the Guarantee in
substantially
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the form attached hereto as Exhibit A, which shall be endorsed
on each Note ordered to be authenticated and delivered by the
Trustee. Each Guarantor hereby agrees that its Guarantee set
forth in this Article Sixteen shall remain in full force and
effect notwithstanding any failure to endorse on each Note a
notation of such Guarantee. Each such Guarantee shall be
signed on behalf of each Guarantor by one of its authorized
Officers prior to the authentication of the Note on which it
is endorsed, and the delivery of such Note by the Trustee,
after the authentication thereof hereunder, shall constitute
due delivery of such Guarantee on behalf of such Guarantor.
Such signatures upon the Guarantee may be by manual or
facsimile signature of such officers and may be imprinted or
otherwise reproduced on the Guarantee, and in case any such
officer who shall have signed the Guarantee shall cease to be
such officer before the Note on which such Guarantee is
endorsed shall have been authenticated and delivered by the
Trustee or disposed of by the Company, such Note nevertheless
may be authenticated and delivered or disposed of as though
the Person who signed the Guarantee had not ceased to be such
officer of the Guarantor.
Section 1608. Waiver of Stay, Extension or Usury Laws.
Each Guarantor 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 each such Guarantor from
performing its Guarantee 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 such Guarantor
hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede
the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as
though no such law had been enacted."
(y) The exhibit attached hereto as Exhibit B shall be
added to the Original Indenture as Exhibit A thereto.
ARTICLE FOUR
MISCELLANEOUS PROVISIONS
Section 401 Confirmation of Original Indenture. The Original
Indenture, as heretofore supplemented and amended by the 1993 Officers'
Certificate, the 1998 Officers' Certificate, the First Supplemental Indenture
and this Second Supplemental Indenture, is in all respects ratified and
confirmed, and the Original Indenture, the 1993 Officers' Certificate, the 1998
Officers' Certificate, the First Supplemental Indenture and this Second
Supplemental Indenture and all
69
indentures supplemental thereto shall be read, taken and construed as one and
the same instrument.
Section 402 Concerning the New Trustee. The New Trustee assumes
no duties, responsibilities or liabilities by reason of this Second Supplemental
Indenture other than as set forth in the Original Indenture and, in carrying out
its responsibilities hereunder, shall have all of the rights, protections and
immunities which it possesses under the Original Indenture. The New Trustee
makes no representation as to the validity, sufficiency or priority of this
Second Supplemental Indenture.
Section 403 Governing Law. This Second Supplemental Indenture and
the Notes shall be governed by and construed in accordance with the laws of the
State of New York applicable to agreements made or instruments entered into and,
in each case, performed in said state.
Section 404 Separability. In case any provision in this Second
Supplemental Indenture or in the Notes shall for any reason be held to be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions of this Second Supplemental Indenture or the Notes
shall not in any way be affected or impaired thereby.
Section 405 Counterparts. This Second Supplemental Indenture may
be executed in several counterparts, each of which shall be an original and all
of which shall constitute but one and the same document.
Section 406 Effect of Headings. The Section headings herein are
for convenience only and shall not affect the construction hereof.
70
IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year first above
written.
DOLE FOOD COMPANY, INC.
By: /s/ Lawrence A. Kern
------------------------------------------
Name: Lawrence A. Kern
Title: President & Chief Operating Officer
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Trustee
By: /s/ Frank McDonald
------------------------------------------
Name: Frank McDonald
Title: Vice President
THE GUARANTORS LISTED ON EXHIBIT C HERETO
By: /s/ C. Michael Carter
------------------------------------------
Name: C. Michael Carter
Title: Vice President
EXHIBIT A
Exhibit A to
Second Supplemental Indenture
[FORM OF NOTICE OF REMOVAL OF TRUSTEE AND
APPOINTMENT OF SUCCESSOR TRUSTEE]
NOTICE IS HEREBY GIVEN that the undersigned DOLE FOOD COMPANY, INC. has
removed J.P. MORGAN TRUST COMPANY as Trustee under the Indenture, dated as of
July 15, 1993, as amended (the "Indenture"), of Dole Food Company, Inc. to
Chemical Trust Company of California, as Trustee, such removal having taken
effect at the opening of business on March 28, 2003. NOTICE IS ALSO HEREBY GIVEN
that the undersigned DOLE FOOD COMPANY, INC., having removed J.P. Morgan Trust
Company as Trustee under the Indenture, has appointed WELLS FARGO BANK, NATIONAL
ASSOCIATION as successor Trustee under such Indenture, and Wells Fargo Bank,
National Association has accepted such appointment, effective as of the opening
of business on March 28, 2003.
Dated: March 28, 2003
DOLE FOOD COMPANY, INC.
A-1
EXHIBIT B
GUARANTEE
For value received, the undersigned hereby unconditionally guarantees,
as principal obligor and not only as a surety, to the Holder of this Note the
cash payments in United States dollars of principal of, premium, if any, and
interest on this Note in the amounts and at the times when due and interest on
the overdue principal, premium, if any, and interest, if any, of this Note, if
lawful, and the payment or performance of all other Obligations of the Company
under the Indenture (as defined below) or the Note, to the Holder of this Note
and the Trustee, all in accordance with and subject to the terms and limitations
of this Note, Article Sixteen of the Indenture, the subordination provisions of
Article Fifteen of the Indenture and this Guarantee. This Guarantee will become
effective in accordance with Article Sixteen of the Indenture and its terms
shall be evidenced therein. The validity and enforceability of this Guarantee
shall not be affected by the fact that it is not affixed to any particular Note.
Capitalized terms used but not defined herein shall have the meanings ascribed
to them in the Second Supplemental Indenture dated as of March 28, 2003, among
Dole Food Company, Inc., a Delaware corporation, as issuer (the "Company"), each
of the Guarantors named therein and Wells Fargo Bank, National Association, as
trustee (the "Trustee") (as amended or supplemented, the "Indenture").
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. Each Guarantor hereby 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 Guarantee.
This Guarantee is subject to release upon the terms set forth in the
Second Supplemental Indenture.
THE GUARANTORS NAMED IN
SCHEDULE A ATTACHED HERETO
By:_______________________________
Name:
Title:
B-1
EXHIBIT C
GUARANTORS
Calazo Corporation
AG 1970, Inc.
AG 1971, Inc.
AG 1972, Inc.
Alyssum Corporation
Barclay Hollander Corporation
Bud Antle, Inc.
Calicahomes, Inc.
California Polaris, Inc.
Dole ABPIK, Inc.
Dole Arizona Dried Fruit and Nut Company
Dole Asia, Inc.
Dole Carrot Company
Dole Citrus
Dole DF&N, Inc.
Dole Dried Fruit and Nut Company, a California General Partnership
Dole Farming, Inc.
Dole Fresh Vegetables, Inc.
Dole Orland, Inc.
Dole Visage, Inc.
E. T. Wall Company
Earlibest Orange Association, Inc.
Fallbrook Citrus Company, Inc.
Lindero Headquarters Company, Inc.
Lindero Property, Inc.
Oceanview Produce Company
Prairie Vista, Inc.
Royal Packing Co.
Veltman Terminal Co.
Bananera Antillana (Colombia), Inc.
Clovis Citrus Association
Delphinium Corporation
Dole Europe Company
Dole Foods Flight Operations, Inc.
Dole Fresh Flowers, Inc.
Dole Northwest, Inc.
Dole Sunfresh Express, Inc.
Standard Fruit and Steamship Company
Standard Fruit Company
Sun Country Produce, Inc.
West Foods, Inc.
Cool Advantage, Inc.
C-1
Cool Care, Inc.
Flowernet Inc.
Saw Grass Transport, Inc.
Blue Anthurium, Inc.
Cerulean, Inc.
Dole Diversified, Inc.
Dole Land Company, Inc.
Dole Packaged Foods Corporation
Intervest, Inc.
La Petite d'Agen, Inc.
MK Development, Inc.
Malaga Company, Inc.
Muscat, Inc.
Oahu Transport Company, Limited
Wahiawa Water Company, Inc.
Waialua Sugar Company, Inc.
Zante Currant, Inc.
Diversified Imports Co.
Dole Assets, Inc.
Dole Fresh Fruit Company
Dole Holdings, Inc.
Dole Logistics Services, Inc.
Dole Ocean Cargo Express, Inc. (DOCE)
Dole Ocean Liner Express, Inc.
Renaissance Capital Corporation
Sun Giant, Inc.
DNW Services Company
Pacific Coast Truck Company
Pan-Alaska Fisheries, Inc.
C-2