EXHIBIT 10.7
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IFCO SYSTEMS N.V.,
as Issuer,
The GUARANTORS named herein
and
THE BANK OF NEW YORK, as Trustee
INDENTURE
Dated as of March 8, 2000
10 5/8% Senior Subordinated Notes due 2010, Series A
10 5/8% Senior Subordinated Notes due 2010, Series B
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CROSS-REFERENCE TABLE
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TIA Indenture
Section Section
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310(a)(1)........................................................................ 7.10
(a)(2)........................................................................ 7.10
(a)(3)........................................................................ N.A.
(a)(4)........................................................................ N.A
(a)(5)........................................................................ 7.10
(b)........................................................................... 7.08; 7.10; 13.02
(b)(1)........................................................................ 7.10
(c)........................................................................... N.A.
311(a)........................................................................... 7.11
(b)........................................................................... 7.11
(c)........................................................................... N.A.
312(a)........................................................................... 2.05
(b)........................................................................... 13.03
(c)........................................................................... 13.03
313(a)........................................................................... 7.06
(b)(1)........................................................................ 7.06
(b)(2)........................................................................ 7.06
(c)........................................................................... 7.06; 13.02
(d)........................................................................... 7.06
314(a)........................................................................... 4.02; 4.08; 13.02
(b)........................................................................... N.A.
(c)(1)........................................................................ 13.04; 13.05
(c)(2)........................................................................ 13.04; 13.05
(c)(3)........................................................................ N.A.
(d)........................................................................... N.A.
(e)........................................................................... 13.05
(f)........................................................................... N.A.
315(a)........................................................................... 7.01; 7.02
(b)........................................................................... 7.05; 13.02
(c)........................................................................... 7.01
(d)........................................................................... 6.05; 7.01; 7.02
(e)........................................................................... 6.11
316(a) (last sentence)........................................................... 2.16
(a)(1)(A)..................................................................... 6.05
(a)(1)(B)..................................................................... 6.04
(a)(2)........................................................................ 8.02
(b)........................................................................... 6.07
(c)........................................................................... 8.04
317(a)(1)........................................................................ 6.08
(a)(2)........................................................................ 6.09
(b)........................................................................... 2.04
318(a)........................................................................... 13.01
N.A. means Not Applicable
____________________
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.....................................................1
Section 1.02. Other Definitions..............................................26
Section 1.03. Incorporation by Reference of Trust Indenture Act..............27
Section 1.04. Rules of Construction..........................................27
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.....................28
Section 2.02. Execution and Authentication; Appointment of Authenticating
Agent.........................................................28
Section 2.03. Registrar and Paying Agent.....................................29
Section 2.04. Paying Agent To Hold Money in Trust............................30
Section 2.05. Noteholder Lists...............................................30
Section 2.06. Transfer and Exchange..........................................31
Section 2.07. Replacement Notes..............................................32
Section 2.08. Outstanding Notes..............................................32
Section 2.09. Temporary Notes................................................32
Section 2.10. Cancellation...................................................32
Section 2.11. Defaulted Interest.............................................32
Section 2.12. Deposit of Moneys; Payments....................................33
Section 2.13. "CUSIP", "ISIN" and "Common Code" Numbers......................33
Section 2.14. Book-Entry Provisions for Global Notes.........................33
Section 2.15. Special Transfer Provisions....................................35
Section 2.16. Treasury Notes.................................................38
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee.............................................38
Section 3.02. Selection of Notes To Be Redeemed..............................38
Section 3.03. Notice of Redemption...........................................39
Section 3.04. Effect of Notice of Redemption.................................39
Section 3.05. Deposit of Redemption Price....................................40
Section 3.06. Notes Redeemed in Part.........................................40
Section 3.07. Redemption for Taxation Reasons................................40
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ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes...............................................41
Section 4.02. Provision of Financial Statements and Other Information........41
Section 4.03. Waiver of Stay, Extension or Usury Laws........................42
Section 4.04. Compliance Certificate; Notice of Default; Tax Information.....42
Section 4.05. Payment of Taxes and Other Claims..............................43
Section 4.06. Corporate Existence............................................43
Section 4.07. Maintenance of Office or Agency................................43
Section 4.08. Compliance with Laws...........................................44
Section 4.09. Maintenance of Properties and Insurance........................44
Section 4.10. Limitation on Additional Indebtedness..........................45
Section 4.11. Limitation on Restricted Payments..............................45
Section 4.12. Limitation on Other Senior Subordinated Indebtedness...........47
Section 4.13. Limitation on Certain Asset Sales..............................47
Section 4.14. Limitation on Transactions with Affiliates.....................50
Section 4.15. Limitations on Liens...........................................51
Section 4.16. Limitations on Investments.....................................52
Section 4.17. Change of Control Offer........................................52
Section 4.18. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries.............................54
Section 4.19. Limitation on Preferred Stock of Restricted Subsidiaries.......56
Section 4.20. Limitation on Creation of Subsidiaries.........................56
Section 4.21. Limitation on Sale and Lease-Back Transactions.................56
Section 4.22. Payments for Consent...........................................57
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation, Merger and Sale of Assets.........57
Section 5.02. Successor Person Substituted...................................58
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default..............................................58
Section 6.02. Acceleration...................................................60
Section 6.03. Other Remedies.................................................60
Section 6.04. Waiver of Existing Defaults and Events of Default..............61
Section 6.05. Control by Majority............................................61
Section 6.06. Limitation on Suits............................................61
Section 6.07. Rights of Holders To Receive Payment...........................62
Section 6.08. Collection Suit by Trustee.....................................62
Section 6.09. Trustee May File Proofs of Claim...............................62
Section 6.10. Priorities.....................................................62
Section 6.11. Undertaking for Costs..........................................63
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ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee..............................................63
Section 7.02. Rights of Trustee..............................................64
Section 7.03. Individual Rights of Trustee...................................66
Section 7.04. Trustee's Disclaimer...........................................66
Section 7.05. Notice of Defaults.............................................66
Section 7.06. Reports by Trustee to Holders..................................66
Section 7.07. Compensation and Indemnity.....................................66
Section 7.08. Replacement of Trustee.........................................67
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion.......68
Section 7.10. Eligibility; Disqualification..................................68
Section 7.11. Preferential Collection of Claims Against Company..............69
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.....................................69
Section 8.02. With Consent of Holders........................................69
Section 8.03. Compliance with TIA............................................71
Section 8.04. Revocation and Effect of Consents..............................71
Section 8.05. Notation on or Exchange of Notes...............................71
Section 8.06. Trustee To Sign Amendments, etc................................72
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Satisfaction and Discharge of Indenture........................72
Section 9.02. Legal Defeasance...............................................73
Section 9.03. Covenant Defeasance............................................73
Section 9.04. Conditions to Defeasance or Covenant Defeasance................74
Section 9.05. Application of Trust Money.....................................75
Section 9.06. Repayment to the Company.......................................76
Section 9.07. Reinstatement..................................................76
ARTICLE 10
GUARANTEE
Section 10.01. Unconditional Guarantee.......................................76
Section 10.02. Severability..................................................77
Section 10.03. Limitation on Guarantor's Liability; Contribution.............77
Section 10.04. Successors and Assigns........................................77
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Section 10.05. No Waiver.....................................................78
Section 10.06. Release of Guarantor..........................................78
Section 10.07. Execution of Supplemental Indenture for Future Guarantors.....78
Section 10.08. Execution and Delivery of Guarantee...........................78
Section 10.09. Subordination of Subrogation and Other Rights.................79
ARTICLE 11
SUBORDINATION OF GUARANTEE
Section 11.01. Guarantee Obligations Subordinated to Senior Debt.............79
Section 11.02. Payment Over of Proceeds upon Dissolution, etc................79
Section 11.03. Suspension of Guaranteed Obligations When Senior Debt in
Default......................................................80
Section 11.04. Trustee's Relation to Senior Debt.............................82
Section 11.05. Subrogation...................................................82
Section 11.06. Guarantee Subordination Provisions Solely To Define Relative
Rights.......................................................82
Section 11.07. Trustee To Effectuate Subordination...........................83
Section 11.08. No Waiver of Subordination Provisions.........................83
Section 11.09. Notice to Trustee.............................................84
Section 11.10. Reliance on Judicial Order or Certificate of Liquidating
Agent........................................................84
Section 11.11. No Suspension of Remedies.....................................84
ARTICLE 12
SUBORDINATION OF NOTES
Section 12.01. Notes Subordinate to Senior Debt..............................85
Section 12.02. Payment Over of Proceeds upon Dissolution, etc................85
Section 12.03. Suspension of Payment When Senior Debt in Default.............86
Section 12.04. Trustee's Relation to Senior Debt.............................87
Section 12.05. Subrogation...................................................88
Section 12.06. Provisions Solely To Define Relative Rights...................88
Section 12.07. Trustee To Effectuate Subordination...........................89
Section 12.08. No Waiver of Subordination Provisions.........................89
Section 12.09. Notice to Trustee.............................................89
Section 12.10. Reliance on Judicial Order or Certificate of Liquidating
Agent........................................................90
Section 12.11. No Suspension of Remedies.....................................90
ARTICLE 13
MISCELLANEOUS
Section 13.01. TIA Controls..................................................90
Section 13.02. Notices.......................................................90
Section 13.03. Communications by Holders with Other Holders..................93
Section 13.04. Certificate and Opinion as to Conditions Precedent............93
Section 13.05. Statements Required in Certificate and Opinion................93
Section 13.06. Rules by Trustee and Agents...................................94
Section 13.07. Business Days; Legal Holidays.................................94
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Section 13.08. Governing Law.................................................94
Section 13.09. Waiver of Trial by Jury.......................................94
Section 13.10. Sovereign Immunity............................................94
Section 13.11. Submission to Jurisdiction....................................94
Section 13.12. Appointment of Agent..........................................95
Section 13.13. No Adverse Interpretation of Other Agreements.................95
Section 13.14. No Recourse Against Others....................................95
Section 13.15. Successors....................................................95
Section 13.16. Multiple Counterparts.........................................95
Section 13.17. Table of Contents, Headings, etc..............................95
Section 13.18. Separability..................................................95
EXHIBITS
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Exhibit A Form of Legend for Global Notes..............................A-1
Exhibit B-1 Form of Note for Initial Notes.............................B-1-1
Exhibit B-2 Form of Note for Exchange Notes............................B-2-1
Exhibit C Form of Transfer Certificate for Transfer from Rule
144A Global Note to Regulation S Global Note................C-1
Exhibit D Form of Transfer Certificate for Transfer from Regulation
S Global Note to Rule 144A Global Note......................D-1
Exhibit E Form of Investor Letter To be Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors.....E-1
Exhibit F Form of Transfer Certificate For Transfer or Exchange of
Restricted Security (Other than Rule 144A Global Note)......F-1
Exhibit G Form of Transfer Certificate for Transfer from Regulation
S Global Note or Rule 144A Global Note to an Accredited
Institutional Investor......................................G-1
Exhibit H Form of Supplemental Indenture...............................H-1
v
INDENTURE, dated as of March 8, 2000, among IFCO SYSTEMS N.V., a
limited liability company incorporated in the Netherlands (the "Company"), as
Issuer, each of the GUARANTORS (as defined herein) and THE BANK OF NEW YORK, a
New York banking corporation, as Trustee (the "Trustee").
The Company has duly authorized the creation of an issue of Series A
10 5/8% Senior Subordinated Notes due 2010 (the "Initial Notes") and Series B
10 5/8% Senior Subordinated Notes due 2010 (the "Exchange Notes") and, to
provide therefor, the Company and each Guarantor has duly authorized the
execution and delivery of this Indenture. All things necessary to make the
Notes, when duly issued and executed by the Company, and authenticated and
delivered hereunder, the valid obligations of the Company, and to make this
Indenture a valid and binding agreement of the Company and the Guarantors, have
been done.
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
"Acquired Indebtedness" means Indebtedness of a Person existing
at the time such Person becomes a Restricted Subsidiary or is merged into or
consolidated with any other Person or that is 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 or such merger, consolidation or acquisition.
"Additional Interest" has the meaning provided to such term in
the Registration Rights Agreement.
"Adjusted Net Assets" of any Person at any date shall mean the
lesser of the amount by which the fair value of the property of such Person
exceeds the total amount of liabilities, including, without limitation,
contingent liabilities (after giving effect to all other fixed and contingent
liabilities), but excluding liabilities under the Guarantee of such Person at
such date and the amount by which the present fair salable value of the assets
of such Person at such date exceeds the amount that will be required to pay the
probable liability of such Person on its debts (after giving effect to all other
fixed and contingent liabilities and after giving effect to any collection from
any Subsidiary of such Person in respect of the Obligations of such Person under
the Guarantee of such Person), excluding Indebtedness in respect of the
Guarantee of such Person, as they become absolute and matured.
"Affiliate" means, with respect to any specific Person, any other
Person that directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such specified Person. For
the purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling," "controlled by," and "under common control
with"), as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that, for
2
purposes of Section 4.14 of this Indenture, beneficial ownership of at least 10%
of the voting securities of a Person, either directly or indirectly, shall be
deemed to be control.
"Agent" means any Registrar, Paying Agent, co-Registrar,
authenticating agent or agent for service of notices and demands.
"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 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 constitute all or substantially all of the
assets of such Person or comprise any division or line of business of such
Person or any other properties or assets of such Person other than in the
ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance,
conveyance, assignment, transfer, lease or other disposition (including any sale
and lease-back transaction), other than to the Company or any of its Restricted
Subsidiaries, in any single transaction or series of related transactions of:
(1) any Capital Stock of or other equity interest in any
Restricted Subsidiary of the Company; or
(2) any other property or assets of the Company or of any
Restricted Subsidiary thereof other than the sale of the Company's products
in the ordinary course of business;
provided that Asset Sales shall not include:
(1) a transaction or series of related transactions for which
the Company or its Restricted Subsidiaries receive aggregate consideration
of less than (Euro)1,500,000;
(2) the sale, lease, conveyance, disposition or other transfer
of all or substantially all of the assets of the Company as permitted under
Section 5.01 of this Indenture;
(3) any Restricted Payment made in compliance with Section 4.11
of this Indenture, and any making of any Permitted Investment;
(4) surrender or waiver of contract rights or the settlement,
release or surrender of contract, tort or other claims of any kind;
(5) sales of Cash Equivalents;
(6) granting of Liens not otherwise prohibited by this
Indenture;
(7) leases or subleases to third persons in the ordinary course
of business that do not interfere in any material respect with the business
of the Company or any of its Restricted Subsidiaries; and
3
(8) transfers of Receivables and Related Assets in connection
with a Permitted Receivables Financing.
"Asset Sale Proceeds" means, with respect to any Asset Sale:
(1) cash and Cash Equivalents received by the Company or any
Restricted Subsidiary of the Company from such Asset Sale (including cash
or Cash Equivalents received as consideration for the assumption of
liabilities incurred in connection with or in anticipation of such Asset
Sale), after
(a) provision for all income or other taxes measured by or
resulting from such Asset Sale,
(b) payment of all brokerage commissions, underwriting and
other fees and expenses related to such Asset Sale,
(c) provision for minority interest holders in any
Restricted Subsidiary of the Company as a result of such Asset Sale,
(d) repayment of Indebtedness that is secured by the
assets subject to such Asset Sale or otherwise required to be repaid
in connection with such Asset Sale, and
(e) deduction of appropriate amounts to be provided by the
Company or a Restricted Subsidiary of the Company as a reserve, in
accordance with GAAP, against any liabilities associated with the
assets sold or disposed of in such Asset Sale and retained by the
Company or a Restricted Subsidiary after such Asset Sale, including,
without limitation, pension and other post-employment benefit
liabilities and liabilities related to environmental matters or
against any indemnification obligations associated with the assets
sold or disposed of in such Asset Sale; and
(2) promissory notes and other non-cash consideration received by the
Company or any Restricted Subsidiary of the Company from such Asset Sale or
other disposition upon the liquidation or conversion of such notes or non-
cash consideration into cash or Cash Equivalents.
"Attributable Indebtedness" in respect of a Sale and Lease-Back
Transaction means, as at the time of determination, the greater of:
(i) the fair value of the property subject to such arrangement; and
(ii) the present value (discounted at the rate borne by the Notes,
compounded annually) of the total obligations of the lessee for rental
payments during the remaining term of the lease included in such Sale and
Lease-Back Transaction (including any period for which such lease has been
extended).
"Available Asset Sale Proceeds" means, with respect to any Asset Sale,
the aggregate Asset Sale Proceeds from such Asset Sale that have not been
applied in accordance with clauses (3)(a) or (3)(b), and which have not yet been
the basis for an Excess Proceeds Offer in accordance with clause (3)(c), of
Section 4.13(A) under this Indenture.
4
"Board of Directors" means, with respect to any Person, the board of
directors or similar governing body of such Person or any duly authorized
committee thereof.
"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.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated and whether
or not voting) of corporate stock, partnership or limited liability company
interests or any other participation, right or other interest in the nature of
an equity interest in such Person including, without limitation, Common Stock
and Preferred Stock of such Person, or any option, warrant or other security
convertible into any of the foregoing.
"Capitalized Lease Obligations" means with respect to any Person,
Indebtedness represented by obligations under a lease that is required to be
capitalized for financial reporting purposes in accordance with GAAP, and the
amount of such Indebtedness shall be the capitalized amount of such obligations
determined in accordance with GAAP.
"Cash Equivalents" means:
(1) securities issued or directly and fully guaranteed or insured by
the Government of any of the member states of the European Union, the
United States of America, Switzerland, or any agency or instrumentality of
any such Government; provided that, in each case, such obligations mature
within one year from the date of acquisition thereof;
(2) commercial paper maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having the highest rating
obtainable from either S&P's or Moody's, or carrying an equivalent rating
by an internationally recognized rating agency if both of the two named
rating agencies cease publishing ratings of investments or do not rate
institutions in the subject country;
(3) time deposits, demand deposits, certificates of deposit or
bankers' acceptances maturing within one year from the date of acquisition
thereof issued by any bank incorporated in a member state of the European
Union, the United States of America, Switzerland, Canada, or any branch of
the foregoing and rated P-1 by Moody's or A-1 by S&P, or carrying an
equivalent rating by an internationally recognized rating agency selected
by the Company if both of the two named rating agencies cease publishing
ratings of investments or do not rate institutions in the subject country;
(4) shares of any money market mutual fund that (a) has its assets
invested continuously in the types of investments referred to in clauses
(1) and (2) above, (b) has net assets of not less than (Euro)250,000,000
(or its foreign currency equivalent), and (c) has the highest rating
obtainable from either S&P's or Moody's, or carrying an equivalent rating
by an internationally recognized rating agency selected by the Company if
both of the two named rating agencies cease publishing ratings of
investments or do not rate institutions in the subject country; and
(5) repurchase agreements with respect to, and which are fully
secured by a perfected security interest in, obligations of a type
described in clause (1) or clause (2) above and are with any commercial
bank described in clause (3) above.
5
"Certificated Notes" means one or more certificated Notes in
registered form.
A "Change of Control" of the Company will be deemed to have occurred
at such time as:
(1) (a) any Person or group of related Persons for purposes of
Section 13(d) of the Exchange Act (a "Group"), other than a Permitted
Holder, becomes the beneficial owner (as defined under Rule 13d-3 or any
successor rule or regulation promulgated under the Exchange Act, except
that a Person shall be deemed to have "beneficial ownership" of all
securities that such Person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time) of 50% or more
of the total voting or economic power of the Company's Capital Stock, and
(b) the Permitted Holders no longer have the power to elect a majority of
the directors of the Board of Directors of the Company;
(2) the occurrence of 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 and its Restricted
Subsidiaries, taken as a whole, to any Person or Group, together with any
Affiliates thereof (whether or not otherwise in compliance with the
provisions of the Indenture) other than to the Permitted Holders;
(3) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors of the
Company (together with any new directors whose election by such Board of
Directors or whose nomination for election by the shareholders of the
Company has been approved by the Permitted Holders or a majority of the
directors then still in office who either were directors at the beginning
of such period or whose election or recommendation for election was
previously so approved) cease to constitute a majority of the Board of
Directors of the Company; or
(4) the approval by the holders of Capital Stock of the Company of
any plan or proposal for the liquidation or dissolution of the Company
(whether or not otherwise in compliance with the provisions of this
Indenture).
"Clearstream" means Clearstream Banking, societe anonyme.
"Commission" means the United States Securities and Exchange
Commission.
"Common Depository" means, with respect to the Notes issued in the
form of one or more Global Notes, The Bank of New York Depository (nominees)
Limited as common depository for Euroclear and Clearstream or another Person
designated as common depository by the Company, which Person must be a clearing
agency registered under the Exchange Act.
"Common Stock" of any Person means all Capital Stock of such Person
that is generally entitled to:
(1) vote in the election of directors of such Person; or
(2) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or
others that will control the management and policies of such Person.
6
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces such party pursuant to Article 5 of this
Indenture and thereafter means the successor.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to any
Person, the ratio of EBITDA of such Person during the four full fiscal quarters
(the "Four Quarter Period") ending on or prior to the date of the transaction
giving rise to the need to calculate the Consolidated Fixed Charge Coverage
Ratio (the "Transaction Date") to Consolidated Fixed Charges of such Person for
the Four Quarter Period. In addition to and without limitation of the
foregoing, for purposes of this definition, "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 or the issuance or redemption or
other repayment of Preferred Stock of any such Restricted Subsidiary (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,
in the case of any Restricted Subsidiary, the issuance or redemption or
other repayment of Preferred Stock (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 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 (except that, in determining the Consolidated
Fixed Charge Coverage Ratio as of any Transaction Date, any Permitted
Indebtedness that is incurred at the same time as the Indebtedness giving
rise to the need to calculate the Consolidated Fixed Charge Coverage Ratio
shall not be included for purposes of such calculation), as if such
incurrence or repayment or issuance or redemption or other 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 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 EBITDA (provided
that such EBITDA shall be included only to the extent includable pursuant
to the definition of "Consolidated Net Income" without regard to clauses
(3) and (7) of the definition of "Consolidated Net Income") (including any
pro forma expense and cost reductions calculated on a basis consistent with
Regulation S-X of the Exchange Act) attributable to the assets that are the
subject of the Asset Acquisition or Asset Sale during the Four Quarter
Period) occurring during the Four Quarter Period or at any time subsequent
to the last day of the Four Quarter Period and on or prior to the
Transaction Date, as if such Asset Sale or Asset Acquisition (including the
incurrence, assumption or liability for any such Acquired Indebtedness)
occurred on the first day of the Four Quarter Period.
If such Person or any of its Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding sentence
shall give effect to the incurrence of such guaranteed Indebtedness as if such
Person or any Restricted Subsidiary of such Person had directly incurred or
otherwise assumed such guaranteed Indebtedness. Furthermore, in calculating
"Consolidated Fixed Charges" for purposes of determining the denominator (but
not the numerator) of this "Consolidated Fixed Charge Coverage Ratio":
(1) interest on outstanding Indebtedness determined on a fluctuating
basis as of the Transaction Date and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per
annum equal to the rate of interest on such Indebtedness in effect on the
Transaction Date;
7
(2) if interest on any Indebtedness actually incurred on the
Transaction Date may optionally be determined at an interest rate based
upon a factor of a prime or similar rate, a eurocurrency interbank offered
rate, or other rates, then the interest rate in effect on the Transaction
Date will be deemed to have been in effect during the Four Quarter Period;
and
(3) notwithstanding clause (1) above, interest on Indebtedness
determined on a fluctuating basis, to the extent such interest is covered
by one or more Hedging 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; plus
(2) the product of
(a) the amount of all dividend and distribution payments on
any series of Disqualified Capital Stock and Preferred Stock of such
Person and its Restricted Subsidiaries paid (other than dividends paid
in Capital Stock (other than Disqualified Capital Stock)), accrued or
scheduled to be paid or accrued during such period, times
(b) a fraction, the numerator of which is one and the
denominator of which is one minus the then current effective
consolidated federal, state and local tax rate of such Person,
expressed as a decimal.
"Consolidated Interest Expense" means, with respect to any Person, for
any period, the aggregate amount of interest which, in conformity with GAAP,
would be set forth opposite the caption "interest expense" or any like caption
on an income statement for such Person and its Restricted Subsidiaries on a
consolidated basis including, but not limited to:
(1) Redeemable Dividends, whether paid or accrued, on Preferred
Stock,
(2) imputed interest included in Capitalized Lease Obligations,
(3) all commissions, discounts and other fees and charges owed with
respect to letters of credit and bankers' acceptance financing,
(4) the net costs associated with Hedging Obligations,
(5) amortization of other financing fees and expenses,
(6) the interest portion of any deferred payment obligation,
(7) amortization of discount or premium, if any,
(8) interest-equivalent costs associated with any Permitted
Receivables Financing, whether accounted for as interest expense or loss on
the sale of Receivables and Related Assets, and
8
(9) all other non-cash interest expense (other than interest
amortized to cost of sales), plus, without duplication,
(1) all net capitalized interest for such period,
(2) all interest incurred or paid under any guarantee of Indebtedness
(including a guarantee of principal, interest or any combination thereof)
of any Person, and
(3) the amount of all dividends or distributions paid on
Disqualified Capital Stock (other than dividends paid or payable in shares
of Capital Stock of the Company that does not constitute Disqualified
Capital Stock).
"Consolidated Net Income" means, with respect to any Person, for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided, however, that there shall be excluded therefrom:
(1) the Net Income of any Person, other than a Restricted Subsidiary
of the referent Person, except to the extent of the amount of dividends or
distributions paid to the referent Person or a Restricted Subsidiary of
such referent Person;
(2) the Net Income of any Restricted Subsidiary of the Person in
question that is subject to any restriction or limitation on the payment of
dividends or the making of other distributions to the extent of such
restriction or limitation;
(3) the Net Income of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition;
(4) any net gain (but not loss) resulting from an Asset Sale by the
Person in question or any of its Restricted Subsidiaries other than in the
ordinary course of business;
(5) extraordinary gains and losses;
(6) income or loss attributable to discontinued operations
(including, without limitation, operations disposed of during such period
whether or not such operations were classified as discontinued);
(7) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent Person's assets,
any earnings of the successor corporation prior to such consolidation,
merger, or transfer of assets; and
(8) non-recurring charges in connection with the Transactions in an
aggregate amount not to exceed (Euro)2.0 million.
"Consolidated Tangible Assets" of any Person at any date means the
total assets of such Person, less goodwill and other intangible assets of such
Person, in each case as shown on the most recent balance sheet of such Person,
determined on a consolidated basis in accordance with GAAP.
9
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of execution of this Indenture is located
at 101 Barclay Street, Floor 21 West, New York, New York 10286, Attention:
Corporate Trust Administration, 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 a successor Trustee may designate from time to time by notice to the Holders
and the Company).
"Cumulative Consolidated Net Income" means, with respect to the
Company, as of any date of determination, Consolidated Net Income from January
1, 2000 to such date of determination, taken as a single accounting period.
"Default" means any event that is, or after notice or passage of time
or both would be, an Event of Default.
"Designated Preferred Stock" means Preferred Stock (not constituting
Disqualified Capital Stock) of the Company (excluding any Preferred Stock issued
on or prior to the Issue Date and any Preferred Stock issued in exchange or
substitution therefor) that is designated as Designated Preferred Stock by the
Company pursuant to an Officers' Certificate delivered to the Trustee on the
issuance date thereof, the cash proceeds of which are excluded from the
calculation set forth in clause (3)(b) of Section 4.11(A) of this Indenture.
"Designated Senior Debt" as to the Company or any Guarantor, as the
case may be, means:
(1) any Senior Debt under the New Senior Credit Facility; and
(2) after the New Senior Credit Facility has been paid in full and
terminated, any other Senior Debt which at the time of determination
exceeds (Euro)25,000,000 in aggregate principal amount (or accreted value
in the case of Indebtedness issued at a discount) outstanding or available
under a committed facility, which is specifically designated in the
instrument evidencing such Senior Debt as "Designated Senior Debt" by such
Person and as to which the Trustee has been given written notice of such
designation.
"Disqualified Capital Stock" means any Capital Stock of a Person or a
Restricted Subsidiary thereof 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), or upon the happening of any event (other than an event
that would constitute a Change of Control), matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
solely at the option of the holder thereof, on or prior to the maturity date of
the Notes, for cash or securities constituting Indebtedness; provided, however,
that Preferred Stock of a Person or any Restricted Subsidiary thereof that is
issued with the benefit of provisions requiring a change of control offer or an
asset sale offer to be made for such Preferred Stock in the event of a change of
control of or sale of assets by such Person or Restricted Subsidiary which
provisions have substantially the same effect as the provisions described under
Sections 4.17 and 4.13 of this Indenture, respectively, shall not be deemed to
be Disqualified Capital Stock solely by virtue of such provisions.
"EBITDA" means, with respect to any Person and its Restricted
Subsidiaries, for any period, an amount equal to
10
(1) the sum of
(a) Consolidated Net Income for such period, plus
(b) the provision for taxes for such period based on income
or profits to the extent such income or profits were included in
computing Consolidated Net Income and any provision for taxes utilized
in computing net loss under clause (a) hereof, plus
(c) Consolidated Interest Expense for such period, plus
(d) depreciation for such period on a consolidated basis, plus
(e) amortization of intangibles for such period on a
consolidated basis, plus
(f) any other non-cash items reducing Consolidated Net
Income for such period (other than any non-cash item requiring an
accrual or reserve for cash disbursements in any future period), minus
(2) all non-cash items increasing Consolidated Net Income for such
period (other than any non-cash item that represents a reversal of an
accrual or reserve initially recorded in anticipation of a cash
disbursement to be made in a future period),
all for such Person and its Restricted Subsidiaries determined on a consolidated
basis in accordance with GAAP.
"Equity Offering" means a sale by the Company of shares of its Common
Stock (however designated and whether voting or non-voting) (other than
Disqualified Capital Stock) and any and all rights, warrants or options to
acquire such Common Stock.
"Euroclear" means Morgan Guaranty Trust Company of New York (Brussels
office) as operator of the Euroclear System.
"Euros" means the common currency for the eleven member states of the
European Union.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"Exchange Notes" has the meaning provided in the preamble to this
Indenture.
"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,
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.
"GAAP" means generally accepted accounting principles consistently
applied as in effect in the United States from time to time.
11
"Guarantee" means the guarantee of the Obligations of the Company with
respect to the Notes by each Guarantor.
"Guarantor" means each Restricted Subsidiary of the Company on the
Issue Date that guarantees the Notes (other than any Immaterial Subsidiaries) as
of the Issue Date and each other Restricted Subsidiary that in the future
executes a Guarantee pursuant to the covenant described under Section 4.20 or
otherwise; provided that any person constituting a Guarantor as described above
shall cease to constitute a Guarantor when its Guarantee is released in
accordance with Section 10.06.
"Hedging Obligations" means, with respect to any Person, the net
payment obligations of such Person under (a) interest rate swap agreements,
interest rate cap agreements and interest rate collar agreements and (b) other
agreements or arrangements entered into in order to protect such Person against
fluctuations in commodity prices, interest rates or currency exchange rates.
"Holder" or "Noteholder" means a Person in whose name a Note is
registered on the Registrar's books or records.
"Immaterial Subsidiaries" means at any time, any Restricted Subsidiary
of the Company having Consolidated Tangible Assets (as determined in accordance
with GAAP) in an amount of less than 1% of the Consolidated Tangible Assets of
the Company and its Restricted Subsidiaries (as determined in accordance with
GAAP); provided, however, that the total Consolidated Tangible Assets (as so
determined) of all Immaterial Subsidiaries shall not exceed 3% of Consolidated
Tangible Assets of the Company and its Subsidiaries (as so determined). In the
event that the Consolidated Tangible Assets of all Immaterial Subsidiaries
exceeds 3% of Consolidated Tangible Assets of the Company and its Restricted
Subsidiaries, the Company will designate Restricted Subsidiaries that would
otherwise be Immaterial Subsidiaries to be excluded as Immaterial Subsidiaries
until such 3% threshold is not exceeded. Notwithstanding the foregoing, no
Restricted Subsidiary that guarantees the New Senior Credit Facility shall be
deemed an Immaterial Subsidiary.
"incur" means, with respect to any Indebtedness or other obligation of
any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become liable in respect of such Indebtedness or
other obligation or the recording, as required pursuant to GAAP or otherwise, of
any such Indebtedness or other obligation on the balance sheet of such Person
(and "incurrence," "incurred," "incurable," and "incurring" shall have meanings
correlative to the foregoing); provided that a change in GAAP that results in an
obligation of such Person that exists at such time becoming Indebtedness shall
not be deemed an incurrence of such Indebtedness.
"Indebtedness" means (without duplication), with respect to any
Person, any indebtedness at any time outstanding, secured or unsecured,
contingent or otherwise, which is for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or only to a
portion thereof), or evidenced by bonds, notes, debentures or similar
instruments or representing the balance deferred and unpaid of the purchase
price of any property (excluding, without limitation, any balances that
constitute accounts payable or trade payables, and other accrued liabilities
arising in the ordinary course of business) if and to the extent any of the
foregoing indebtedness would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, and shall also include, to the extent
not otherwise included:
(1) any Capitalized Lease Obligations of such Person;
12
(2) obligations secured by a lien to which the property or assets
owned or held by such Person is subject, whether or not the obligation or
obligations secured thereby shall have been assumed; provided that, if such
obligations have not been assumed by such Person, the amount of such
Indebtedness shall be the lesser of (A) the fair market value of such
assets at such date of determination and (B) the amount of such
obligations;
(3) guarantees of items of other Persons which would be included
within this definition for such other Persons (whether or not such items
would appear upon the balance sheet of the guarantor);
(4) all obligations for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction;
(5) Disqualified Capital Stock of such Person or any Restricted
Subsidiary thereof, and valued at its mandatory maximum redemption price or
liquidation preference plus accrued dividends; and
(6) Obligations of any such Person under any hedging obligations
applicable to any of the foregoing (if and to the extent such hedging
obligations would appear as a liability upon a balance sheet of such Person
prepared in accordance with GAAP);
provided that
(1) the amount outstanding at any time of any Indebtedness issued
with original issue discount is the principal amount of such Indebtedness
less the remaining unamortized portion of the original issue discount of
such Indebtedness at such time as determined in conformity with GAAP; and
(2) Indebtedness shall not include any liability for federal, state,
local or other taxes.
Guarantees of (or obligations with respect to letters of credit supporting)
Indebtedness otherwise included in the determination of such amount shall not
also included as Indebtedness.
"Indenture" means this Indenture as amended, restated or supplemented
from time to time.
"Independent Financial Advisor" means an investment banking, financial
advisory, valuation or accounting firm of national reputation in the United
States:
(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.
"Initial Notes" has the meaning provided in the preamble to this
Indenture.
"Initial Purchasers" refers to CIBC World Markets Corp. and Banc One
Capital Markets, Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
promulgated under the Securities Act.
13
"Interest Payment Date" means the stated maturity of an installment of
interest on the Notes.
"Investments" means, with respect of any Person, directly or
indirectly, any advance, account receivable (other than an account receivable
arising in the ordinary course of business of such Person), loan or capital
contribution to (by means of transfers of property to others, payments for
property or services for the account or use of others or otherwise), the
purchase of any Capital Stock, bonds, notes, debentures, partnership or joint
venture interests or other securities of, the acquisition, by purchase or
otherwise, of all or substantially all of the business or assets or stock or
other evidence of beneficial ownership of, any Person or the making of any
investment in any Person. Investments shall exclude extensions of trade credit
on commercially reasonable terms in accordance with normal trade practices of
such Person, but shall include the repurchase of securities of any Person by
such Person.
For the purposes of Sections 4.11 and 4.16 of this Indenture:
(1) "Investment" shall include and be valued at the fair market
value of the net assets of any Restricted Subsidiary at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary;
(2) the fair market value of the net assets of any Unrestricted
Subsidiary at the time that such Unrestricted Subsidiary is designated a
Restricted Subsidiary shall be deemed a repayment of such Investment; and
(3) the amount of any Investment shall be the original cost of such
Investment plus the cost of all additional Investments by the Company or
any of its Restricted Subsidiaries, without any adjustments for increases
or decreases in value, or write-ups, write-downs or write-offs with respect
to such Investment, reduced by the payment of cash distributions in respect
thereof received by the Company or any Restricted Subsidiary of the
Company;
provided that no such payment of distributions or receipt of any such other
amounts shall reduce the amount of any Investment if such payment of
distributions or receipt of any such amounts would be included in Consolidated
Net Income. 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 such Restricted Subsidiary would no longer constitute a Restricted
Subsidiary of the Company, the Company shall be deemed to have made 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 the date the Notes are first issued by the Company
and authenticated by the Trustee under this Indenture.
"Lien" means, with respect to any property or assets of any Person,
any mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, preference,
priority, or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including
without limitation, any Capitalized Lease Obligation, conditional sales, or
other title retention agreement having substantially the same economic effect as
any of the foregoing).
"Maturity Date" means March 15, 2010.
14
"Net Income" means, with respect to any Person, for any period, the
net income (loss) of such Person determined in accordance with GAAP.
"Net Proceeds" means:
(1) in the case of any sale of Capital Stock by or equity
contribution to any Person, the aggregate net proceeds received by such
Person, after payment of expenses, commissions and the like incurred in
connection therewith, whether such proceeds are in cash or in property
(valued at the fair market value thereof, as determined in good faith by
the Board of Directors of such Person, at the time of receipt);
(2) in the case of any exchange, exercise, conversion or surrender of
outstanding securities of any kind for or into shares of Capital Stock of
the Company that is not Disqualified Capital Stock, the net book value of
such outstanding securities on the date of such exchange, exercise,
conversion or surrender (plus any additional amount required to be paid by
the holder to such Person upon such exchange, exercise, conversion or
surrender, less any and all payments made to the holders, e.g., on account
of fractional shares and less all expenses incurred by such Person in
connection therewith); and
(3) in the case of any issuance of any Indebtedness by the Company
or any Restricted Subsidiary, the aggregate net cash proceeds received by
such Person after the payments of expenses, commissions, underwriting
discounts and the like incurred in connection therewith.
"New Senior Credit Facility" means the Credit Agreement dated as of a
date on or about the Issue Date, among PalEx, Inc., the guarantors party
thereto, CIBC World Markets Corp. and Banc One Capital Markets, Inc. as Co-Lead
Arrangers, Bank One, Texas, NA as Administrative Agent, CIBC World Markets Corp.
as Syndication Agent, and the lenders party thereto in their capacities as
lenders thereunder, 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 increasing the amount of available borrowings
thereunder (provided that such increase in borrowings is permitted by Section
4.10) 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 and whether by the same or
any other agent, lender or group of lenders.
"Non-Payment Event of Default" means any event (other than a Payment
Default) the occurrence of which entitles one or more Persons to accelerate the
maturity of any Designated Senior Debt.
"Non-U.S. Person" means a person who is not a U.S. person, as defined
in Regulation S.
"Notes" means the Initial Notes and the Exchange Notes treated as a
single class of securities, as amended or supplemented from time to time in
accordance with the terms hereof, that are issued pursuant to this Indenture.
"Obligations" means all obligations for principal, premium, interest,
penalties, charges, fees, indemnities, reimbursement obligations and other
liabilities payable under the documentation governing any Indebtedness.
15
"Offering Memorandum" means the offering memorandum dated March 3,
2000 pursuant to which the Notes were originally offered.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the Chief Financial Officer, Chief
Accounting Officer, Treasurer, President, any Vice President, director or other
authorized signatory of such Person.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chairman of the Board, Chief Executive Officer, the
President or any Vice President, managing director or other authorized signatory
and the Chief Financial Officer, Chief Accounting Officer or any Treasurer or
Assistant Treasurer, managing director or other authorized signatory of such
Person that shall comply with applicable provisions of this Indenture.
"Opinion of Counsel" means a written opinion from legal counsel
reasonably acceptable to the Trustee complying with the requirements of this
Indenture.
"Payment Default" means any Default, whether or not any requirement
for the giving of notice, the lapse of time or both, or any other condition to
such Default becoming an Event of Default has occurred, in the payment of
principal of or premium, if any, or interest on or any other amount payable in
connection with Designated Senior Debt.
"Permitted Asset Swap" means any transfer of properties or assets by
the Company or any of its Restricted Subsidiaries in which the consideration
received by the transferor consists of properties or assets (other than cash or
Cash Equivalents) that will be used in the business of the transferor; provided
that the aggregate fair market value (as determined in good faith by the board
of directors of the Company) of the property or assets being transferred by the
Company or such Restricted Subsidiary is not greater than the aggregate fair
market value (as determined in good faith by the board of directors) of the
property or assets received by the Company or such Subsidiary in such exchange.
"Permitted Holders" means Christoph Schoeller, Martin A. Schoeller,
their respective children and spouses or other lineal descendants, or any other
corporation, partnership, or other entity all of the shareholders, partners,
members, or owners of which are any of the foregoing.
"Permitted Indebtedness" means:
(1) Indebtedness incurred pursuant to the New Senior Credit Facility
in an aggregate principal amount at any time outstanding not to exceed
$125.0 million, reduced by any required permanent repayments (which are
accompanied by a corresponding permanent commitment reduction) thereunder;
(2) Indebtedness under (a) the Notes outstanding on the Issue Date
and (b) the Guarantees;
(3) Indebtedness not covered by any other clause of this definition
which is outstanding on the Issue Date;
(4) Indebtedness of the Company to any Restricted Subsidiary and
Indebtedness of any Restricted Subsidiary to the Company or another
Restricted Subsidiary;
16
(5) Purchase Money Indebtedness and Capitalized Lease Obligations
incurred to acquire property used or useful in the ordinary course of
business which Purchase Money Indebtedness and Capitalized Lease
Obligations do not in the aggregate exceed at any one time outstanding an
amount equal to the greater of (a) (Euro)20,000,000 and (b) 5% of the Total
Assets of the Company determined on a consolidated basis, as shown on the
balance sheet of the Company as of the end of the most recent fiscal
quarter, in accordance with GAAP;
(6) Hedging Obligations;
(7) Refinancing Indebtedness;
(8) Indebtedness of the Company or any Restricted Subsidiary arising
from the honoring by a bank or other financial institution of a check,
draft or similar instrument inadvertently drawn against insufficient funds
in the ordinary course of business; provided that such Indebtedness is
extinguished within five Business Days of incurrence;
(9) Indebtedness of the Company or any Restricted Subsidiary
consisting of guarantees, indemnities or obligations in respect of purchase
price adjustments (including adjustments in the purchase price related to
the performance or results of any acquired business) in connection with the
acquisition or disposition of assets permitted under the Indenture;
(10) Indebtedness of the Company or any of its Restricted Subsidiaries
represented by letters of credit for the account of the Company or such
Restricted Subsidiary, as the case may be, issued in the ordinary course of
business of the Company or such Restricted Subsidiary, including, without
limitation, in order to provide security for worker's compensation claims
or payment obligations in connection with self-insurance or similar
requirements in the ordinary course of business and other Indebtedness with
respect to workers' compensation claims, self-insurance obligations,
performance, surety and similar bonds and completion guarantees provided by
the Company or any Restricted Subsidiary in the ordinary course of
business;
(11) guarantees of Indebtedness otherwise permitted under this
Indenture; and
(12) additional Indebtedness of the Company and its Restricted
Subsidiaries not to exceed (Euro)15,000,000 in aggregate principal amount
at any one time outstanding.
"Permitted Investments" means Investments made on or after the Issue
Date consisting of:
(1) Investments by the Company, or by a Restricted Subsidiary
thereof, in the Company or a Restricted Subsidiary;
(2) Investments by the Company, or by a Restricted Subsidiary
thereof, in a Person, if as a result of such Investment
(a) such Person becomes a Restricted Subsidiary of the
Company, or
(b) such Person is merged, consolidated or amalgamated with
or into, or transfers or conveys substantially all of its assets to,
or is liquidated into, the Company or a Restricted Subsidiary thereof;
17
(3) Investments in cash and Cash Equivalents;
(4) loans and advances made to officers and employees of the Company
and its Restricted Subsidiaries in the ordinary course of business not to
exceed (Euro)1,500,000 in the aggregate at any one time outstanding;
(5) an Investment that is made by the Company or a Restricted
Subsidiary thereof in the form of any Capital Stock, bonds, notes,
debentures, partnership or joint venture interests or other securities that
are issued by a third party to the Company or such Restricted Subsidiary
solely as partial consideration for the consummation of an Asset Sale that
is otherwise permitted under Section 4.13 of this Indenture;
(6) Hedging Obligations entered into in the ordinary course of the
Company's or its Restricted Subsidiaries' business and not for speculative
purposes;
(7) Investments in prepaid expenses, negotiable instruments held for
collection and lease, utility and workers compensation, performance and
similar deposits entered into as a result of the operations of the business
in the ordinary course of business;
(8) Investments in any of the Notes;
(9) receivables owing to the Company or any Restricted Subsidiary
created in the ordinary course of business;
(10) Investments in securities of trade creditors or customers
received pursuant to any plan of reorganization or similar arrangement upon
the bankruptcy or insolvency of such trade creditors or customers or in
good faith settlement of delinquent obligations of such trade creditors or
customers;
(11) obligations of one or more officers or other employees of the
Company or any of its Restricted Subsidiaries in connection with such
officer's or employee's acquisition of shares of Common Stock of the
Company so long as no cash is paid by the Company or any of its Restricted
Subsidiaries to such officers or employees in connection with the
acquisition of any such obligations;
(12) Investments acquired in exchange for, or out of the Net Proceeds
(which have not, and will not, be included pursuant to clause (3)(b) of
Section 4.11(A) under this Indenture) of a substantially concurrent
offering of, shares of Capital Stock (other than Disqualified Capital
Stock) of the Company (or options, warrants or other rights to acquire such
Capital Stock);
(13) Investments in connection with a Permitted Receivables Financing
by or to any Receivables Subsidiary, including Investments of funds held in
accounts permitted or required by the arrangements governing such Permitted
Receivables Financing or any related Indebtedness;
(14) additional Investments the amount of which when made, when taken
together with the then outstanding amount of other Investments made under
this clause (14), shall not exceed (Euro)10,000,000 in the aggregate at any
one time outstanding.
18
"Permitted Liens" means the following types of Liens:
(1) Liens for taxes, assessments, or governmental charges or claims
either (a) not delinquent or (b) contested in good faith by appropriate
proceedings and as to which the Company or its Restricted Subsidiaries
shall have set aside on its books such reserves as may be required pursuant
to GAAP;
(2) statutory Liens for landlords and Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen, and other Liens
imposed by law incurred in the ordinary course of business for sums not yet
delinquent or being contested in good faith, if such reserve or other
appropriate provision, if any, as shall be required by GAAP, shall have
been made in respect thereof;
(3) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance,
and other types of social security, including any Lien securing letters of
credit issued in the ordinary course of business consistent with past
practice in connection therewith, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, and other similar
obligations (exclusive of obligations for the payment of borrowed money);
(4) judgment Liens not giving rise to an Event of Default;
(5) easements, right-of-way, zoning restrictions and other similar
charges or encumbrances in respect of real property not interfering in any
material respect with the ordinary conduct of business of the Company or
any of its Restricted Subsidiaries;
(6) any interest or title of a lessor under any Capitalized Lease
Obligation; provided that such Liens do not extend to any property or
assets which is not leased property subject to such Capitalized Lease
Obligation;
(7) Liens upon specific items of inventory or other goods and
proceeds of any person securing such Persons' obligations in respect of
bankers' acceptances issued or created for the account of such Person to
facilitate the purchase, shipment, or storage of such inventory or other
goods;
(8) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(9) Liens securing Hedging Obligations that relate to Indebtedness
that is otherwise permitted under the Indenture;
(10) Liens securing Capitalized Lease Obligations and Purchase Money
Indebtedness permitted pursuant to clause (5) of the definition of
"Permitted Indebtedness"; provided, however, that in the case of Purchase
Money Indebtedness (a) the Indebtedness shall not exceed the cost of such
property or assets and shall not be secured by any property or assets of
the Company or any Restricted Subsidiary other than the property and assets
so acquired or constructed and (b) the Lien securing such Indebtedness
shall be created within 180 days of such acquisition or construction or, in
the case of a refinancing of any Purchase Money Indebtedness, within 180
days of such refinancing;
19
(11) Liens securing Acquired Indebtedness incurred in accordance
with the Section 4.10; provided that
(a) such Liens secured Acquired Indebtedness at the time of
and prior to the incurrence of such Acquired Indebtedness by the
Company or a Restricted Subsidiary and were not granted in connection
with, or in anticipation of, the incurrence of such Acquired
Indebtedness by the Company or a Restricted subsidiary, and
(b) such Liens do not extend to or cover any property or
assets of the Company or any of its Restricted Subsidiaries other than
the property or assets that secured the Acquired Indebtedness prior to
the time such Indebtedness became Acquired Indebtedness of the Company
or a Restricted Subsidiary of the Company and are no more favorable to
the lienholders than those securing the Acquired Indebtedness prior to
the incurrence of such Acquired Indebtedness by the Company or a
Restricted Subsidiary; and
(12) Liens securing industrial revenue bonds; and
(13) Liens not permitted by clauses (1) through (12) that are incurred
in the ordinary course of business of the Company or any Restricted
Subsidiary of the Company with respect to obligations that do not exceed
(Euro)5.0 million at any one time outstanding.
"Permitted Receivables Financing" means a transaction or series of
transactions (including amendments, supplements, extensions, renewals,
replacements, refinancings or modifications thereof) pursuant to which a
Receivables Subsidiary purchases Receivables and Related Assets from the Company
or any Subsidiary and finances such Receivables and Related Assets through the
issuance of indebtedness or equity interests or through the sale of the
Receivables and Related Assets or a fractional undivided interest in the
Receivables and Related Assets; provided that:
(1) the Board of Directors shall have determined in good faith that
such Permitted Receivables Financing is economically fair and reasonable to
the Company and the Receivables Subsidiary;
(2) all sales of Receivables and Related Assets to or by the
Receivables Subsidiary are made at fair market value (as determined in good
faith by the Board of Directors of the Company);
(3) the financing terms, covenants, termination events and other
provisions thereof shall be market terms (as determined in good faith by
the Board of Directors of the Company);
(4) no portion of the Indebtedness of a Receivables Subsidiary is
guaranteed by or is recourse to the Company or any Restricted Subsidiary
(other than recourse for customary representations, warranties, covenants
and indemnities, none of which shall relate to the collectibility of the
Receivables and Related Assets); and
(5) neither the Company nor any Subsidiary has any obligation to
maintain or preserve the Receivables Subsidiary's financial condition.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government (including any agency or political
subdivision thereof).
20
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or liquidation proceeds of such Person over the holders
of other Capital Stock issued by such Person.
"Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth on Exhibit B-1.
"Property" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent consolidated balance sheet of such Person and its Subsidiaries under
GAAP.
"Purchase Money Indebtedness" means Indebtedness of any Person
incurred for the purpose of financing all or any part of the purchase price, or
the cost of installation, construction or improvement of, any Property.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A promulgated under the Securities Act.
"Receivables and Related Assets" means accounts receivable and
instruments, chattel paper, obligations, general intangibles and other similar
assets, in each case relating to such receivables, including interests in
merchandise or goods, the sale or lease of which gave rise to such receivable,
related contractual rights, guarantees, insurance proceeds, collections, other
related assets and proceeds of all of the foregoing.
"Receivables Subsidiary" means a Wholly Owned Restricted Subsidiary
which is established for the limited purpose of acquiring and financing
Receivables and Related Assets and engaging in activities ancillary thereto.
"Record Date" for interest payable on any Interest Payment Date
(except a date for payment of default interest) means the September 1 and March
1 (whether or not a Business Day) as the case may be, immediately preceding such
Interest Payment Date.
"Redeemable Dividend" means, for any dividend or distribution with
regard to Preferred Stock, the quotient of the dividend or distribution divided
by the difference between one and the maximum statutory federal income tax rate
(expressed as a decimal number between 1 and 0) then applicable to the issuer of
such Preferred Stock.
"Redemption Date" when used with respect to any Note to be redeemed
means the date fixed for such redemption pursuant to this Indenture.
"Redemption Price" when used with respect to any Note to be redeemed
means the price fixed for such redemption pursuant to this Indenture.
"Refinancing Indebtedness" means Indebtedness that refunds, refinances
or extends Indebtedness of the Company or of a Restricted Subsidiary of the
Company incurred pursuant to the Consolidated Fixed Charge Coverage Ratio test
of Section 4.10(A) or pursuant to clauses (2), (3), (4), (8), (9) or (11) of the
definition of Permitted Indebtedness, but only to the extent that:
21
(1) if the Indebtedness being refunded, refinanced or extended is
subordinated to the Notes, the Refinancing Indebtedness shall be
subordinated to the Notes to at least the same extent as the Indebtedness
being refunded, refinanced, or extended;
(2) the Refinancing Indebtedness is scheduled to mature either
(a) no earlier than the Indebtedness being refunded,
refinanced or extended, or
(b) after the maturity date of the Notes;
(3) the portion, if any, of the Refinancing Indebtedness that is
scheduled to mature on or prior to the maturity date of the Notes has a
Weighted Average Life to Maturity at the time such Refinancing Indebtedness
is incurred that is equal to or greater than the Weighted Average Life to
Maturity of the portion of the Indebtedness being refunded, refinanced or
extended that is scheduled to mature on or prior to the maturity date of
the Notes; and
(4) such Refinancing Indebtedness is in an aggregate principal amount
that is equal to or less than the sum of
(a) the aggregate principal amount then outstanding under the
Indebtedness being refunded, refinanced or extended,
(b) the amount of accrued and unpaid interest, if any, and
premiums owed, if any, not in excess of preexisting prepayment
provisions on such Indebtedness being refunded, refinanced or
extended, and
(c) the amount of customary fees, expenses and costs related
to the incurrence of such Refinancing Indebtedness.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of March 8, 2000 among the Company, the Guarantors and CIBC
World Markets Corp. and Banc One Capital Markets, Inc., as Initial Purchasers.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Restricted Payment" means any of the following:
(1) the declaration or payment of any dividend or any other
distribution or payment on Capital Stock of the Company or any Restricted
Subsidiary of the Company or any payment made to the direct or indirect
holders (in their capacities as such) of Capital Stock of the Company or
any Restricted Subsidiary of the Company (other than (a) dividends or
distributions payable solely in Capital Stock (other than Disqualified
Capital Stock) or in options, warrants or other rights to purchase such
Capital Stock (other than Disqualified Capital Stock), and (b) in the case
of Restricted Subsidiaries of the Company, dividends or distributions
payable to the Company or to a Restricted Subsidiary of the Company and pro
rata dividends or distributions payable to the other holders of Common
Stock of such Restricted Subsidiary);
22
(2) the purchase, redemption or other acquisition or retirement for
value of any Capital Stock of the Company or any of its Restricted
Subsidiaries (other than Capital Stock owned by the Company or a Wholly
Owned Restricted Subsidiary of the Company, excluding Disqualified Capital
Stock) or any option, warrants or other rights to purchase such Capital
Stock;
(3) the making of any principal payment on, or the purchase,
defeasance, repurchase, redemption or other acquisition or retirement for
value, prior to any scheduled maturity, scheduled repayment or scheduled
sinking fund payment, of any Indebtedness which is subordinated in right of
payment to the Notes (other than subordinated Indebtedness acquired in
anticipation of satisfying a scheduled sinking fund obligation, principal
installment or final maturity, in each case due within one year of the date
of acquisition);
(4) the making of any Investment or guarantee of any Investment in
any Person other than a Permitted Investment; and
(5) any designation of a Restricted Subsidiary as an Unrestricted
Subsidiary (valued at the fair market value of the net assets of such
Restricted Subsidiary on the date of such designation).
"Restricted Security" has the meaning set forth in Rule 144(a)(3)
promulgated under the Securities Act; provided that the Trustee shall be
entitled to request and conclusively rely upon an Opinion of Counsel with
respect to whether any Note is a Restricted Security.
"Restricted Subsidiary" means a Subsidiary of the Company other than
an Unrestricted Subsidiary and includes all of the Subsidiaries of the Company
existing as of the Issue Date. The Board of Directors of the Company may
designate any Unrestricted Subsidiary as a Restricted Subsidiary if immediately
after giving effect to such action (and treating any Acquired Indebtedness as
having been incurred at the time of such action):
(1) the Company could have incurred at least (Euro)1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 4.10 of this Indenture; and
(2) no Default or Event of Default shall have occurred and be
continuing or result therefrom.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Sale and Lease-Back Transaction" means any arrangement with any
Person providing for the leasing by the Company or any Restricted Subsidiary of
the Company of any real or tangible personal property, which property has been
or is to be sold or transferred by the Company or such Restricted Subsidiary to
such Person in contemplation of such leasing.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Senior Debt" means the principal of and premium, if any, and interest
on, and any and all other fees, expense reimbursement obligations and other
amounts due pursuant to the terms of all agreements, documents and instruments
providing for, creating, securing or evidencing or otherwise entered into in
connection with:
23
(1) all Indebtedness of the Company or any Guarantor owed to
lenders under the New Senior Credit Facility;
(2) all obligations of the Company or any Guarantor with respect to
any Hedging Obligations;
(3) all obligations of the Company or any Guarantor to reimburse any
bank or other person in respect of amounts paid under letters of credit,
acceptances or other similar instruments;
(4) all other Indebtedness of the Company or any Guarantor which
does not provide that it is to rank pari passu with or subordinate to the
Notes or the Guarantee of such Guarantor, as the case may be; and
(5) all deferrals, renewals, extensions and refundings of, and
amendments, modifications and supplements to, any of the Senior Debt
described above.
Notwithstanding anything to the contrary in the foregoing, Senior Debt will not
include:
(1) Indebtedness of the Company or any Guarantor to any of its
Subsidiaries, or to any Affiliate of the Company or such Guarantor or any
of such Affiliate's Subsidiaries;
(2) Indebtedness represented by the Notes and the Guarantees;
(3) any Indebtedness that by the express terms of the agreement or
instrument creating, evidencing or governing the same is junior or
subordinate in right of payment to any item of Senior Debt;
(4) any trade payable arising from the purchase of goods or
materials or for services obtained in the ordinary course of business;
(5) Indebtedness incurred in violation of this Indenture, unless such
Indebtedness consists of Indebtedness under the New Senior Credit Facility,
and the holder(s) of such Indebtedness and their agents and representatives
shall have received a representation from the Company at the time of
incurrence to the effect that the incurrence of such Indebtedness did not
violate the Indenture;
(6) Indebtedness represented by Disqualified Capital Stock; or
(7) any Indebtedness to or guaranteed on behalf of, any
shareholders, director, officer or employee of the Company or any
Subsidiary of the Company.
"Significant Restricted Subsidiary" means, with respect to any Person,
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
Securities Act, as such Rule is in effect on the Issue Date.
"SMG Exchangeable Shares" means the Non-Voting Exchangeable Shares
issued by SMG Corporation, a corporation amalgamated under the laws of the
Province of Ontario, all of the voting stock of which is held by PalEx, Inc.
24
"Subsidiary" of any specified Person means any corporation,
partnership, limited liability company, joint venture, association or other
business entity, whether now existing or hereafter organized or acquired:
(1) in the case of a corporation, of which more than 50% of the total
voting power of the Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of directors,
officers or trustees thereof is held by such first-named Person or any of
its Subsidiaries; or
(2) in the case of a partnership, limited liability company, joint
venture, association or other business entity, with respect to which such
first-named Person or any of its Subsidiaries has the power to direct or
cause the direction of the management and policies of such entity by
contract or otherwise or if in accordance with GAAP such entity is
consolidated with the first-named Person for financial statement purposes.
"Total Assets" means the total consolidated assets of the Company and
its Restricted Subsidiaries, as set forth on the Company's most recent
consolidated balance sheet.
"Transactions" means the transactions described under the heading "The
Transactions" in the Offering Memorandum.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939
(15 U.S. Code sections 77aaa-77bbbb) as in effect on the date of this Indenture
(except as provided in Section 8.03 hereof).
"Trust 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.
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Unrestricted Global Notes" means Global Notes that represent
beneficial interests in Unrestricted Notes.
"Unrestricted Notes" means one or more Notes that do not and are not
required to bear the Private Placement Legend in the form set forth in Section
2.15, including, without limitation, the Exchange Notes.
"Unrestricted Subsidiary" means:
(1) any Subsidiary of an Unrestricted Subsidiary; and
(2) any Subsidiary of the Company which is classified after the
Issue Date as an Unrestricted Subsidiary by a resolution adopted by the
Board of Directors of the Company;
25
provided that a Subsidiary may be so classified as an Unrestricted Subsidiary
only if
(a) such classification is in compliance with Section 4.11 of this
Indenture,
(b) immediately after giving effect to such classification, the
Company could have incurred at least (Euro)1.00 of additional Indebtedness
(other than Permitted Indebtedness) pursuant to Section 4.10,
(c) no Default or Event of Default shall have occurred and be
continuing or result therefrom, and
(d) neither the Company nor any Restricted Subsidiary shall at any
time
(i) provide a guarantee of, or similar credit support to, any
Indebtedness of such Subsidiary (including any undertaking, agreement
or instrument evidencing such Indebtedness),
(ii) be directly or indirectly liable for any Indebtedness
of such Subsidiary, or
(iii) be directly or indirectly liable for any other
Indebtedness which provides that the holder thereof may (upon notice,
lapse of time or both) declare a default thereon (or cause the payment
thereof to be accelerated or payable prior to its final scheduled
maturity) upon the occurrence of a default with respect to any other
Indebtedness that is Indebtedness of such Subsidiary (including any
corresponding right to take enforcement action against such
Subsidiary),
except in the case of clause (i) or (ii) to the extent
(A) that the Company or such Restricted Subsidiary could
otherwise provide such a guarantee or incur such Indebtedness
(other than as Permitted Indebtedness) pursuant to Section
4.10 under this Indenture, and
(B) the provision of such guarantee and the incurrence of
such Indebtedness otherwise would be permitted under Section
4.11 of this Indenture.
The Trustee shall be given prompt notice by the Company of each
resolution adopted by the Board of Directors of the Company under this
provision, together with a copy of each such resolution adopted.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:
(1) the then outstanding aggregate principal amount of such
Indebtedness; into
(2) the sum of the total of the products obtained by multiplying
(a) 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
26
(b) 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" means any Restricted Subsidiary,
all of the outstanding voting securities (other than directors' qualifying
shares) of which are owned, directly or indirectly, by the Company. For purposes
of this definition, any directors' qualifying shares or investments by foreign
nationals mandated by applicable law shall be disregarded in determining the
ownership of a Restricted Subsidiary.
Section 1.02. Other Definitions.
The definitions of the following terms may be found in the sections
indicated as follows:
Term Defined in Section
"Additional Amounts"................................................... 3.07
"Affiliate Transaction"................................................ 4.14
"Agent Members"........................................................ 2.14
"Bankruptcy Law"....................................................... 6.01
"Business Day"......................................................... 13.07
"Change of Control Offer".............................................. 4.17
"Change of Control Payment Date"....................................... 4.17
"Change of Control Purchase Price"..................................... 4.17
"Covenant Defeasance".................................................. 9.03
"Custodian"............................................................ 6.01
"Event of Default"..................................................... 6.01
"Excess Proceeds Offer"................................................ 4.13
"Excess Proceeds Payment Date"......................................... 4.13
"Funding Guarantor".................................................... 10.03
"Global Notes"......................................................... 2.01
"Guarantee Payment Blockage Period".................................... 11.03
"Guarantor Representative"............................................. 11.03
"IAI Global Notes"..................................................... 2.01
"Initial Blockage Period".............................................. 12.03
"Initial Guarantee Blockage Period".................................... 11.03
"Investor Letter"...................................................... 2.15
"Legal Defeasance"..................................................... 9.02
"Legal Holiday"........................................................ 13.07
"Luxembourg Paying Agent".............................................. 2.03
"Offshore Physical Notes".............................................. 2.01
"Paying Agent"......................................................... 2.03
"Payment Blockage Period".............................................. 12.03
"Physical Notes"....................................................... 2.01
"Registrar"............................................................ 2.03
"Regulation S Global Notes"............................................ 2.01
"Representative"....................................................... 12.03
"Restricted Period".................................................... 2.14
27
"Rule 144A Global Notes"............................................... 2.01
"Successor Person"..................................................... 5.01
"U.S. Physical Notes".................................................. 2.01
Section 1.03. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
portion of such provision required to be incorporated herein in order for this
Indenture to be qualified under the TIA is incorporated by reference in and made
a part of this Indenture. The following TIA terms used in this Indenture have
the following meanings:
"indenture securities" means the Notes.
"indenture securityholder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor on the indenture securities" means the Company, the
Guarantors or any other obligor on the Notes.
All other terms used in this Indenture that are defined by the
TIA, defined in the TIA by reference to another statute or defined by Commission
rule have the meanings therein assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein, whether
defined expressly or by reference;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular; and
(5) words used herein implying any gender shall apply to every
gender.
28
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.
The Notes and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit B-1 which is incorporated in and made
part of this Indenture with such appropriate insertions, substitutions and other
variations as are required or permitted by this Indenture. The Notes may have
notations, legends or endorsements required by law, stock exchange rule or usage
all in a form approved by the Company. The Company may use "CUSIP", "ISIN" and
"Common Code" numbers in issuing the Notes. Each Note shall be dated the date of
its authentication.
The Notes initially offered and sold (i) in reliance on Rule 144A
shall be issued initially in the form of one or more permanent global Notes in
registered form (the "Rule 144A Global Notes") and (ii) pursuant to Regulation S
shall be issued initially in the form of one or more permanent global Notes in
registered form (the "Regulation S Global Notes"), in each case substantially in
the form set forth in Exhibit B-1, deposited with the Trustee, as custodian for
the Common Depository, duly executed by the Company and authenticated by the
Trustee as hereinafter provided and shall bear the legend set forth on Exhibit
A. Notes offered and sold by Holders to institutional investors that qualify as
"accredited investors" within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act will be in the form of a global Note substantially in
the form of Exhibit B-1, with such applicable legends as are set forth in
Exhibit A, except as otherwise permitted herein (the "IAI Global Notes" and,
together with the Rule 144A Global Notes and the Regulation S Global Notes, the
"Global Notes"). The aggregate principal amount of any Global Note may from
time to time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Common Depository, as hereinafter provided.
Notes offered and sold in offshore transactions in reliance of
Regulation S issued in the form of certificated Notes in registered form set
forth in Exhibit B-1 (the "Offshore Physical Notes"). Notes transferred to
Institutional Accredited Investors and Notes offered and sold in reliance on
Rule 144A may each also be issued, in the form of certificated Notes in
registered form in substantially the form set forth in Exhibit B-1 (the "U.S.
Physical Notes"). The Offshore Physical Notes and the U.S. Physical Notes are
sometimes collectively herein referred to as the "Physical Notes."
The provisions of the "Operating Procedures of the Euroclear
System" and "Terms and Conditions Governing Use of Euroclear" and the "General
Terms and Conditions of Clearstream" and "Customer Handbook" of Clearstream
shall be applicable to interests in the Global Notes that are held by the
participants through Euroclear or Clearstream.
Section 2.02. Execution and Authentication; Appointment of Authenticating
Agent.
The Notes shall be executed on behalf of the Company by one or
more Officers of the Company. Such signature may be either manual or facsimile.
If an Officer whose signature is on a Note no longer holds that
office at the time the Trustee authenticates the Note, the Note shall be valid
nevertheless.
29
A Note shall not be valid until the Trustee manually signs the
certificate of authentication on the Note. Such signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
The Trustee shall authenticate (i) Initial Notes for original
issue in the aggregate principal amount not to exceed (Euro)200,000,000 in one
series, (ii) Private Exchange Notes from time to time only in exchange for a
like principal amount of Initial Notes and (iii) Unrestricted Notes from time to
time only (x) in exchange for a like principal amount of Initial Notes or (y) in
an aggregate principal amount of not more than the excess of (Euro)200,000,000
over the sum of the aggregate principal amount of (A) Initial Notes then
outstanding, (B) Private Exchange Notes then outstanding and (C) Unrestricted
Notes issued in accordance with (iii)(x) above, in each case upon a written
order of the Company in the form of an Officer's Certificate of the Company.
Each such written order shall specify the amount of Notes to be authenticated
and the date on which the Notes are to be authenticated, whether the Notes are
to be Initial Notes, Private Exchange Notes or Unrestricted Notes and whether
the Notes are to be issued as Physical Notes or Global Notes or such other
information as the Trustee may reasonably request. In addition, with respect to
authentication pursuant to clauses (ii) or (iii) of the first sentence of this
paragraph, the first such written order from the Company shall be accompanied by
an Opinion of Counsel of the Company in a form reasonably satisfactory to the
Trustee stating that the issuance of the Private Exchange Notes or the
Unrestricted Notes, as the case may be, does not give rise to an Event of
Default, complies with this Indenture and has been duly authorized by the
Company. The aggregate principal amount of Notes outstanding at any time may not
exceed (Euro)200,000,000, except as provided in Sections 2.07 and 2.08.
In the event that the Company shall issue and the Trustee shall
authenticate any Notes issued under this Indenture subsequent to the Issue Date
pursuant to clauses (i) and (iii) of the first sentence of the immediately
preceding paragraph, the Company shall use its best efforts to obtain the same
"CUSIP", "ISIN" and "Common Code" number for such Notes as is printed on the
Notes outstanding at such time; provided, however, that if any series of Notes
issued under this Indenture subsequent to the Issue Date is determined, pursuant
to an Opinion of Counsel of the Company in a form reasonably satisfactory to the
Trustee to be a different class of security than the Notes outstanding at such
time for federal income tax purposes, the Company may obtain a "CUSIP", "ISIN"
and "Common Code" number for such Notes that is different than the "CUSIP",
"ISIN" and "Common Code" number printed on the Notes then outstanding.
Notwithstanding the foregoing, all Notes issued under this Indenture shall vote
and consent together on all matters as to which any such Notes may vote or
consent as one class and no series of Notes will have the right to vote or
consent as a separate class on any matter.
The Notes shall be issuable only in registered form without
coupons and only in minimum denominations of (Euro)50,000 and in increments of
(Euro)1,000 above 50,000.
The Trustee, with the approval of the Company, may appoint an
authenticating agent to authenticate Notes. Any such appointment shall be
evidenced by an instrument signed by an authorized officer of the Trustee, a
copy of which shall be furnished to the Company. An authenticating agent may
authenticate Notes whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent, and shall comply with this Indenture. An authenticating agent has the
same right as an Agent to deal with the Company or an Affiliate.
Section 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, in London, England and, so long as the Notes
are listed on the Luxembourg Stock Exchange and the rules of such stock exchange
require, in Luxembourg where (a) Notes may be presented or surrendered for
reg-
30
istration of transfer or for exchange ("Registrar"), (b) Notes may be
presented or surrendered for payment ("Paying Agent") and (c) notices and
demands in respect of Notes and this Indenture may be served. The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Registrar shall provide the Company a current copy of such register from time to
time upon request of the Company. The Company may have one or more co-
registrars and one or more additional paying agents. The Company may change any
Paying Agent, Registrar or co-registrar without notice to any Noteholder.
Neither the Company nor any Guarantor may act as Paying Agent, but may act as
Registrar or co-registrar.
The Company shall enter into an appropriate agency agreement
with any Registrar or Paying Agent not a party to this Indenture, which shall
incorporate the provisions of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall notify
the Trustee in writing of the name and address of any such Agent. If the Company
fails to maintain a Registrar or Paying Agent, or agent for service of notices
and demands, or fails to give the foregoing notice, the Company shall notify the
Trustee and the Trustee shall to the extent that it is capable act as such for
so long as such failure continues.
The Company initially appoints the Trustee as Registrar and
Paying Agent in the Borough of Manhattan, The City of New York, the Trustee
(acting through its London branch) as Registrar and Paying Agent in London,
England and Kredietbank S.A. Luxembourgeoise, a Luxembourg banking organization,
as Paying Agent in Luxembourg (the "Luxembourg Paying Agent").
Section 2.04. Paying Agent To Hold Money in Trust.
Before 10:00 A.M. London, England time on the Business Day prior
to each payment date of the principal of and/or interest on any Notes, the
Company shall deposit with the Paying Agent a sum sufficient to pay such
principal and interest so becoming due. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee together with a complete
accounting of such sums and the Trustee may at any time during the continuance
of any Event of Default under Section 6.01(a) or (b), upon written request to a
Paying Agent, require such Paying Agent to forthwith pay to the Trustee all sums
so held in trust by such Paying Agent together with a complete accounting of
such sums. Upon doing so, the Paying Agent shall have no further liability for
the money. Funds deposited with the Paying Agent may be invested as agreed from
time to time by the Company and the Paying Agent. All payments made hereunder
shall be in Euros.
Section 2.05. Noteholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Noteholders. If the Trustee is not the Registrar, the Company shall furnish to
the Trustee at least five Business Days before each Interest Payment Date and
the Maturity Date and at such other times as the Trustee may reasonably request
in writing, a list in such form and as of such date as the Trustee may require
of the names and addresses of Noteholders.
Section 2.06. Transfer and Exchange.
Subject to the provisions of Section 2.14 and 2.15, when a Note
is presented to the Registrar with a request to register the transfer thereof,
the Registrar shall register the transfer as requested if the requirements of
this Indenture are met and, when Notes are presented to the Registrar with a
written request to exchange them for an equal principal amount of Notes, the
Registrar shall make the exchange as requested; provided that the Registrar may
require every Note presented or surrendered for registration of transfer or
exchange
31
be duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Registrar duly executed by the Holder
thereof or his attorney duly authorized in writing. To permit transfers and
exchanges, upon surrender of any Note for registration of transfer at the office
or agency maintained pursuant to Section 2.03 hereof, the Company shall execute
and the Trustee shall authenticate one or more new Notes at the Registrar's
request. Any exchange or transfer shall be without charge, except that the
Company may require payment by the Holder of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation to a transfer or
exchange other than any exchange pursuant to Sections 2.09, 3.06 or 8.05 hereof.
The Registrar shall not be required to register transfers of Notes or to
exchange Notes for a period beginning 15 days before the mailing of a notice of
redemption of Notes and ending on the date of such mailing. The Registrar shall
not be required to exchange or register transfers of any Notes called or being
called for redemption in whole or in part, except the unredeemed portion of any
Note being redeemed in part.
None of the Issuers or the Trustee or the Registrar shall be
liable for any delay by the Common Depository in identifying the beneficial
owners of the Notes and each such person may conclusively rely on, and shall be
protected in relying on, instructions from the Common Depository for all
purposes (including with respect to the registration and delivery, and the
respective principal amounts, of any Notes to be issued).
The Notes will be issued in a transaction exempt from
registration under the Securities Act and will be subject to transfer
restrictions as described in the Offering Memorandum.
Prior to the due presentation for registration of transfer of any
Note, the Company, the Trustee, the Paying Agent, the Registrar or any co-
registrar may deem and treat the Person in whose name a Note is registered as
the absolute owner of such Note for the purpose of receiving payment of
principal of and interest, if any, on such Note and for all other purposes
whatsoever, whether or not such Note is overdue, and none of the Company, the
Trustee, the Paying Agent, the Registrar or any co-registrar shall be affected
by notice to the contrary. So long as the Common Depository or its nominee is
the registered owner or Holder of a Global Note, the Common Depository or such
nominee, as the case may be, will be considered the sole owner or Holder of the
Notes represented by such Global Note for all purposes hereunder and under the
Notes. Any Holder of a Global Note and each Person with an interest in such
Global Note, shall, by acceptance of such Global Note or such interest agree
that transfers of the beneficial interests in such Global Note may be effected
only through a book entry system maintained by the Holder of such Global Note
(or its agent), and that ownership of a beneficial interest in the Global Note
shall be required to be reflected in a book entry.
Any Note issued upon any transfer or exchange pursuant to this
Section 2.06 will evidence the same debt and will be entitled to the same
benefits and unless otherwise provided for in this Indenture, subject to the
same restrictions, under this Indenture as the Note or Notes surrendered upon
such transfer or exchange.
Section 2.07. Replacement Notes.
If a mutilated Note is surrendered to the Trustee or if the
Holder of a Note claims that a Note has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a replacement
Note if the Trustee's requirements for replacement are met. An indemnity bond
may be required by the Company or the Trustee that is sufficient in the judgment
of the Company and the Trustee to protect the Company, the Trustee or any Agent
from any loss which any of them may suffer if a Note is replaced and evidence to
their satisfaction of apparent loss, destruction or theft of such Note may be
required by the Company, the Trustee or any Agent. The Company and the Trustee
may charge for their reasonable out-of-pocket expenses (including reasonable
attorneys' fees and expenses and any applicable taxes) in replacing a Note. In
the event any such mutilated, lost, destroyed or wrongfully taken Note has
become due and payable, the Company
32
in its discretion may pay such Note instead of issuing a new Note in replacement
thereof. If after the delivery of such new Note, a bona fide purchaser of the
original Note in lieu of which such new Note was issued presents for payment
such original Note, the Company and the Trustee shall be entitled to recover
such new Note from the person to whom it was delivered or any transferee
thereof, except a bona fide purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Company or the Trustee in connection therewith.
Every replacement Note is an additional obligation of the
Company.
Section 2.08. Outstanding Notes.
Notes outstanding at any time are all Notes authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation, and those described in this Section 2.08 as not outstanding.
If a Note is replaced pursuant to Section 2.07 (other than a
mutilated Note surrendered for replacement), it ceases to be outstanding until
the Trustee receives proof satisfactory to it that the replaced Note is held by
a bona fide purchaser.
If a Paying Agent holds on a Redemption Date or Maturity Date
money sufficient to pay the principal of, premium, if any, and accrued interest
on Notes (or portions thereof) payable on that date, then on and after that
date, such Notes (or portions thereof) cease to be outstanding and interest on
them ceases to accrue.
Section 2.09. Temporary Notes.
Until definitive Notes are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Notes. Temporary Notes
shall be substantially in the form, and shall carry all rights and restrictions,
of definitive Notes but may have variations that the Company considers
appropriate for temporary Notes. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate definitive Notes in exchange for
temporary Notes upon surrender of such temporary Notes at the office or agency
maintained pursuant to Section 2.03 hereof.
Section 2.10. Cancellation.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee
shall cancel all Notes surrendered for transfer, exchange, payment or
cancellation and, unless the Company instructs the Trustee in writing to deliver
the Notes to the Company, shall dispose of such Notes in accordance with its
normal practice. Subject to Section 2.07 hereof, the Company may not issue new
Notes to replace Notes in respect of which it has previously paid all principal,
premium and interest accrued thereon, or delivered to the Trustee for
cancellation. The Trustee shall provide the Company with a list of all Notes
that have been cancelled from time to time as requested in writing by the
Company.
Section 2.11. Defaulted Interest.
If the Company defaults in a payment of principal or interest
on the Notes, it shall pay interest on overdue principal and on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the rate per annum borne by the Notes, to the extent
lawful.
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If the Company defaults in a payment of interest on the Notes, on
any scheduled Interest Payment Date, such interest shall cease to be payable to
the Noteholders as of the Record Date applicable to such Interest Payment Date,
and the Company shall pay or deposit with the Paying Agent the defaulted
amounts, plus any interest payable on defaulted amounts pursuant to Section 4.01
hereof, to the persons who are Noteholders on a subsequent special record date.
The Company shall fix the special record date and payment date in a manner
satisfactory to the Trustee and provide the Trustee at least 20 days notice of
the proposed amount of defaulted interest to be paid and the special payment
date. At least 15 days before the special record date, the Company shall mail or
cause to be mailed to each Noteholder at his address as it appears on the Notes
register maintained by the Registrar a notice that states the special record
date, the payment date (which shall be not less than five nor more than ten days
after the special record date), and the amount to be paid. In lieu of the
foregoing procedures, the Company may pay defaulted interest in any other lawful
manner satisfactory to the Trustee.
Notwithstanding the foregoing, any interest which is paid prior
to the expiration of the 30-day period set forth in Section 6.01(b) shall be
paid to Holders as of the Record Date for the Interest Payment Date for which
interest has not been paid.
Section 2.12. Deposit of Moneys; Payments.
Prior to 10:00 A.M., London, England time, on the Business Day
prior to each Interest Payment Date and on the Business Day prior to the
Maturity Date, the Company shall have deposited with the Paying Agents in
immediately available funds money sufficient to make all cash payments due on
such Interest Payment Date or the Maturity Date, as the case may be. The
principal and interest on Global Notes shall be payable to the Common Depository
or its nominee, as the case may be, as the sole registered owner and the sole
holder of the Global Notes represented thereby. The principal and interest on
Physical Notes shall be payable at the office of the Paying Agents. The Paying
Agents shall pay the Company any excess cash remaining on deposit after all
payments have been made with respect to a given Interest Payment Date or the
Maturity Date, as the case may be. All payments made hereunder shall be in
Euros.
Section 2.13. "CUSIP", "ISIN" and "Common Code" Numbers.
The Company in issuing the Notes shall use "CUSIP", "ISIN" and
"Common Code" number(s) and the Trustee shall use the "CUSIP", "ISIN" and
"Common Code" number(s) in notices of redemption or exchange as a convenience to
Holders; provided that neither the Company nor the Trustee shall have any
responsibility for any defect in the "CUSIP", "ISIN" or "Common Code" number
that appears on any Note, check, advice or payment or redemption notice, and any
such notice may state that no representation is made as to the correctness or
accuracy of the "CUSIP", "ISIN" and "Common Code" number(s) printed in the
notice or on the Notes, and that reliance may be placed only on the other
identification numbers printed on the Notes and any such redemption or exchange
shall not be affected by any defect in or omission of such number(s). The
Company shall promptly notify the Trustee of any changes in "CUSIP", "ISIN" or
"Common Code" numbers.
Section 2.14. Book-Entry Provisions for Global Notes.
(a) The Global Notes initially shall (i) be registered in the
name of the Common Depository or the nominee of such Common Depository, (ii) be
delivered to the Trustee as custodian for such Common Depository and (iii) bear
legends as set forth in Exhibit A. Until and including the 40th day after the
Closing Date (the "Restricted Period"), book-entry interests in a Regulation S
Global Note may be held only through Euroclear or Clearstream, unless transfer
occurs in accordance with Section 2.15(b).
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Members of, or participants in, Euroclear or Clearstream ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Note held on their behalf by the Common Depository, or the Trustee as its
custodian, or under the Global Note, and the Common Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of the Global Note for all purposes whatsoever. Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Common Depository
or impair, as between Euroclear or Clearstream and its Agent Members, the
operation of customary practices governing the exercise of the rights of a
Holder of any Note.
(b) Transfers of Global Notes shall be limited to transfers in
whole, but not in part, to the Common Depository, its successors or their
respective nominees. Transfers of beneficial interests from one Global Note to
another Global Note shall be effected by an increase or a reduction in the
aggregate principal amount of Notes represented by the first Global Note and the
corresponding reduction or increase in the aggregate principal amount of Notes
represented by the other Global Note. Any beneficial interest in one of the
Global Notes that is transferred to a Person who takes delivery in the form of a
beneficial interest in another Global Note will, upon transfer, cease to be a
beneficial interest in such Global Note and become a beneficial interest in such
other Global Note and, accordingly, will thereafter be subject to all transfer
restrictions, if any, and other procedures or conditions applicable to
beneficial interests in such other Global Note for as long as it remains such an
interest.
(c) Physical Notes shall be issued to all beneficial owners in
exchange for their beneficial interests in Global Notes if (i) Euroclear and
Clearstream notify the Company that they are unwilling or unable to continue as
depository for any Global Note and a successor depository is not appointed by
the Company within 90 days of such notice or (ii) an Event of Default has
occurred and is continuing and (A) the Registrar has received a written request
from the Common Depository to issue Physical Notes or (B) any Holder thereof so
requests in connection with any action taken pursuant to Sections 6.02 or 6.07.
(d) In connection with the transfer or exchange of Global Notes
as an entirety to beneficial owners pursuant to paragraph (c), the Global Notes
shall be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall, upon receipt of written request of
the Company in the form of an Officers' Certificate, authenticate and deliver,
to each beneficial owner identified by the Common Depository in writing in
exchange for its beneficial interest in the Global Notes, an equal aggregate
principal amount of Physical Notes of authorized denominations.
Upon the issuance of definitive notes, payments of interest on a
definitive note will be made (1) by check drawn on a bank in London and mailed
to the payee or (2) by transfer to an account maintained by the payee with a
bank in London, in either case to the person in whose name such definitive note
is registered on the fifteenth day before the due date for the payment of
interest and payment of principal upon presentation and surrender of such
definitive note at the specified office of the Paying Agent or any additional or
substitute Paying Agent by a Euro-denominated check drawn on a bank in London,
as the case may be.
(e) Any Physical Note constituting a Restricted Security
delivered in exchange for an interest in a Global Note pursuant to paragraph (c)
or (d) shall, except as provided by paragraphs (a)(i)(x) and (c) of Section
2.15, bear the Private Placement Legend.
(f) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
35
Section 2.15. Special Transfer Provisions.
Unless and until a Note is exchanged for an Exchange Note or
sold in connection with an effective Registration Statement pursuant to the
Registration Rights Agreement, the following provisions shall apply:
(a) Transfers to Non-QIB Institutional Accredited Investors. The
following provisions shall apply with respect to the registration of any
proposed transfer of a Note constituting a Restricted Security to any
Institutional Accredited Investor which is not a QIB:
(i) the Registrar shall register the transfer of any Note
constituting a Restricted Security, whether or not such Note bears
the Private Placement Legend, if (x) the requested transfer is
subsequent to a date which is two years after the later of the Issue
Date and the last date on which the Company or any of its Affiliates
was the owner of such Note or (y) in the case of a transfer to an
Institutional Accredited Investor which is not a QIB (excluding Non-
U.S. Persons), the transferee has executed and delivered to the
Company, the Trustee (with a copy to the Registrar) and the Initial
Purchasers an institutional accredited investor transferee compliance
letter (an "Investor Letter") substantially in the form of Exhibit E
hereto and any legal opinions and certifications required thereby; and
(ii) upon receipt by the Registrar of (x) the certificate in
substantially the form of Exhibit E and any legal opinions and
certifications required by clause (y) of paragraph (i) above and (y)
instructions given in accordance with the procedures of Euroclear or
Clearstream, as the case may be, and the Registrar, (1) the Registrar
shall reflect on its books and records the date and a decrease in the
principal amount of the Global Note in which the transferor's
beneficial interest is held in an amount equal to the principal amount
of the beneficial interest in such IAI Global Note to be transferred
or shall cancel any Physical Note so transferred, and (2) the
Registrar shall reflect on its books and records, if necessary, a
corresponding increase in the principal amount of the IAI Global Note
in which the transferee's beneficial interest will be held or, if it
is determined by the Company that Physical Notes must be issued, the
Company shall execute and the Trustee shall authenticate and make
available for delivery one or more Physical Notes of like tenor and
amount.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Note to a QIB
(excluding transfers to Non-U.S. Persons):
(i) If the Note to be transferred is (A) either a U.S. Physical
Note or an Offshore Physical Note prior to the expiration of the
Restricted Period, the transferor must deliver to the Company and the
Trustee a certificate substantially in the form of Exhibit D hereto
(with a copy to the Registrar), and the transferee must advise the
Company and the Trustee in writing that it is purchasing the Note for
its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a QIB within
the meaning of Rule 144A and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received
such information regarding the Company as it has requested pursuant to
Rule 144A or has determined not to request such information and that
it is aware that the transferor is relying upon its foregoing
representations in order to claim the exemption from registration
provided by Rule 144A or (B) a beneficial interest in a Rule 144A
Global
36
Note, the transfer of such interest may be effected only through the
book-entry system maintained by Euroclear and Clearstream.
(ii) If the proposed transferee is an Agent Member and the Note
to be transferred consists of a U.S. Physical Note, upon receipt by
the Company the Trustee and the Registrar of the documents referred to
in paragraph (i) above and instructions given in accordance with the
procedures of Euroclear or Clearstream, as the case may be, the
Registrar shall reflect on its books and records the date and an
increase in the principal amount of the Rule 144A Global Notes in an
amount equal to the principal amount of the U.S. Physical Note to be
transferred, and the Trustee shall cancel the U.S. Physical Note so
transferred.
(c) Transfers of Interests in the Regulation S Global Notes or
Offshore Physical Note. The following provisions shall apply with respect
to any transfer of interests in the Regulation S Global Notes or Offshore
Physical Note:
(i) prior to the expiration of the Restricted Period, such
transfer must comply with paragraph (a), (b) or (d) of this Section
2.15; and
(ii) after the expiration of such period, transfers of any such
Note may be made without provision of any additional certification.
(d) Transfers to Non-U.S. Persons at Any Time. The following
provisions shall apply with respect to any transfer of a Note to a Non-U.S.
Person:
(i) any proposed transfer to any Non-U.S. Person of a U.S.
Physical Note or an interest in a Rule 144A Global Note may be made
upon receipt by the Company and the Trustee (with a copy to the
Registrar) of a certificate substantially in the form of Exhibit C
hereto from the proposed transferor.
(ii) (a) If the proposed transferor is an Agent Member holding
a beneficial interest in a Rule 144A Global Note, upon receipt by the
Company, the Trustee and the Registrar of (A) the documents, if any,
required by paragraph (i) and (B) instructions in accordance with the
procedures of Euroclear or Clearstream, as the case may be, the
Registrar shall reflect on its books and records the date and a
decrease in the principal amount of the Rule 144A Global Notes in an
amount equal to the principal amount of the beneficial interest in the
Rule 144A Global Notes to be transferred, and (b) if the proposed
transferee is an Agent Member, upon receipt by the Registrar of
instructions given in accordance with the procedures of Euroclear or
Clearstream, as the case may be, the Registrar shall reflect on its
books and records the date and an increase in the principal amount of
the Regulation S Global Notes in an amount equal to the principal
amount of the U.S. Physical Note or the Rule 144A Global Notes, as the
case may be, to be transferred, and the Trustee shall cancel the
Physical Security, if any, so transferred or decrease the amount of
the Rule 144A Global Notes.
(e) Transfers between Unrestricted Global Notes. The following
restrictions shall apply with respect to transfers between Unrestricted
Global Notes:
(i) If the proposed transferor is an Agent Member holding a
beneficial interest in an Unrestricted Global Note, upon receipt by
the Trustee of instructions in accordance with
37
the procedures of Euroclear or Clearstream, as the case may be, the
Registrar shall reflect on its books and records the date and a
decrease in the principal amount of the Unrestricted Global Note in
which such transferor has a beneficial interest in an amount equal to
the principal amount of the beneficial interest in such Unrestricted
Global Note to be transferred, and (ii) if the proposed transferee is
an Agent Member, upon receipt by the Trustee of instructions given in
accordance with the procedures of Euroclear or Clearstream, as the
case may be, the Registrar shall reflect on its books and records the
date and an increase in the principal amount of the Unrestricted
Global Note in which the transferee holds a beneficial interest in an
amount equal to the principal amount of the beneficial interest in the
other Unrestricted Global Note to be transferred, and the Registrar
shall decrease the amount of the Unrestricted Global Note in which the
transferor had a beneficial interest.
(ii) Upon the occurrence of the Exchange Offer in accordance
with the Registration Rights Agreement, the Company shall issue and
upon receipt of an authentication order in accordance with Section
2.02, the Trustee (or its agent in accordance with Section 2.02) shall
authenticate one or more Unrestricted Global Notes in the form of
Exhibit B-2 hereto in an aggregate principal amount equal to the
aggregate principal amount of the beneficial interests in Notes
tendered for acceptance by persons participating therein. Separate
Unrestricted Global Notes shall be issued in respect of the exchange
of Rule 144A Global Notes and Regulation S Global Notes and such
separate Unrestricted Global Notes shall bear different ISIN and
Common Code numbers.
(f) Private Placement Legend. Upon the transfer, exchange or
replacement of Notes not bearing or subject to the restrictions covered by
the Private Placement Legend, the transferred or replacement Notes shall
not bear or be subject to the restrictions covered by the Private Placement
Legend, unless the Company believes that such transferred or replacement
Notes are or will be Restricted Securities, in which case, such Notes shall
bear, or be subject to the restrictions covered by, the Private Placement
Legend. Upon the transfer, exchange or replacement of Notes bearing or
subject to the Private Placement Legend, the Registrar shall deliver only
Notes that bear or are subject to the Private Placement Legend unless (i)
the circumstances contemplated by paragraph (a)(i)(x) of this Section 2.15
exist, (ii) there is delivered to the Registrar an Opinion of Counsel
reasonably satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are required
in order to maintain compliance with the provisions of the Securities Act
or (iii) such Note has been sold pursuant to an effective registration
statement under the Securities Act (including pursuant to an Exchange Offer
(as defined in the Registration Rights Agreement)).
(g) General. By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions
on transfer of such Note set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Note only as
provided in this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.14 or this Section 2.15.
The Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
The Trustee and the Registrar shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with
38
respect to any transfer of any interest in any Note (including any transfers
between or among Agent Members or beneficial owners of interests in any Global
Note) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and when
expressly required by the terms of, this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
Section 2.16. Treasury Notes.
In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver, consent or notice,
Notes owned by the Company or any of its Affiliates shall be considered as
though they are not outstanding, except that for the purposes of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Notes which a Trust Officer of the Trustee actually knows are
so owned shall be so considered. The Company shall notify the Trustee, in
writing, when it or any of its Affiliates repurchases or otherwise acquires
Notes, of the aggregate principal amount of such Notes so repurchased or
otherwise acquired.
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee.
If the Company elects to redeem Notes pursuant to paragraph 7 of
the Notes, at least 60 days prior to the Redemption Date or during such other
period as the Trustee may agree to, the Company shall notify the Trustee in
writing of the Redemption Date, the principal amount of Notes to be redeemed and
the Redemption Price, and deliver to the Trustee an Officers' Certificate
stating that such redemption will comply with the conditions contained herein
and in the Notes, as appropriate.
Section 3.02. Selection of Notes To Be Redeemed.
In the event that less than all of the Notes are to be redeemed
at any time, selection of the Notes to be redeemed shall be made by the Trustee
in compliance with the standard procedures of Euroclear and/or Clearstream, as
the case may be, and the Luxembourg Stock Exchange on a pro rata basis, by lot
or by such method as the Trustee shall deem fair and equitable; provided,
however, that no Notes of a principal amount of (Euro)1,000 or less shall be
redeemed in part; provided, further, that if a partial redemption is made with
the proceeds of any Equity Offering, selection of the Notes or portions thereof
for redemption shall be made by the Trustee only on a pro rata basis or on as
nearly a pro rata basis as is practicable (subject to the procedures of the
Euroclear and/or Clearstream, as the case may be, and the Luxembourg Stock
Exchange), unless such method is otherwise prohibited. A new Note in a principal
amount equal to the unredeemed portion thereof will be issued in the name of the
Holder thereof upon delivery of the original Note to the Paying Agent and
cancellation of the original Note. On and after the Redemption Date, interest
will cease to accrue on Notes or portions thereof called for redemption as long
as the Company has deposited with the Paying Agents in Euros in satisfaction of
the applicable Redemption Price pursuant to this Indenture.
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Section 3.03. Notice of Redemption.
Notice of redemption shall be mailed by first class mail at
least 30 but not more than 60 calendar days before the Redemption Date to each
Holder of Notes to be redeemed at its registered address. If any Note is to be
redeemed in part only, the notice of redemption that relates to such Note shall
state the portion of the principal amount thereof to be redeemed. If the Company
elects to have the Trustee give notice of redemption, the Trustee shall give
notice in the name of the Company and at the Company's expense; provided,
however, that the Company shall furnish the Trustee all information required to
be contained in the notice. As long as the Notes are listed on the Luxembourg
Stock Exchange, and the rules of the Luxembourg Stock Exchange require, a notice
or redemption of the Notes will be published in a Luxembourg newspaper of
general circulation.
The notice shall identify the Notes to be redeemed (including the
"CUSIP", "ISIN" and "Common Code" number(s) thereof) and shall state:
(1) the Redemption Date;
(2) the Redemption Price and the amount of accrued interest,
if any, to be paid;
(3) that, if any Note is being redeemed in part, the portion of
the principal amount (equal to (Euro)1,000 in principal amount or any
integral multiple thereof) of such Note to be redeemed and that, on and
after the Redemption Date, upon surrender of such Note, a new Note or Notes
in principal amount equal to the unredeemed portion thereof will be issued;
(4) the name, address and telephone number of the Paying Agent;
(5) that Notes called for redemption must be surrendered to
the Paying Agent at the address specified in such notice to collect the
Redemption Price plus accrued interest, if any;
(6) that, unless the Company defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the Redemption Date and the only remaining right of the Holders is to
receive payment of the Redemption Price plus accrued interest to the
Redemption Date upon surrender of the Notes to the Paying Agent;
(7) the subparagraph of the Notes pursuant to which the Notes
called for redemption are being redeemed; and
(8) if fewer than all the Notes are to be redeemed, the
identification of the particular Notes (or portion thereof) to be redeemed,
as well as the aggregate principal amount of Notes to be redeemed and the
aggregate principal amount of Notes to be outstanding after such partial
redemption.
Section 3.04. Effect of Notice of Redemption.
Once the notice of redemption described in Section 3.03 is
mailed, Notes called for redemption become due and payable on the Redemption
Date and at the Redemption Price, including any premium, plus accrued interest
to the Redemption Date, if any. Upon surrender to the Paying Agent, such Notes
shall be paid at the Redemption Price, including any premium, plus accrued
interest to the Redemption Date, if any; pro-
40
vided that if the Redemption Date is after a Record Date and on or prior to the
Interest Payment Date, the accrued interest shall be payable to the Holder of
the redeemed Notes registered on the relevant Record Date.
Section 3.05. Deposit of Redemption Price.
On or prior to 10:00 a.m., London time, at least one Business Day
prior to each Redemption Date, the Company shall have deposited with the Paying
Agent in immediately available funds Euros sufficient to pay the Redemption
Price of and accrued interest on all Notes to be redeemed on that date. The
Paying Agent shall return to the Company any money deposited with the Paying
Agent by the Company in excess of the amount necessary to pay the redemption
price of an accrued interest, if any, on all Notes to be redeemed.
On and after any Redemption Date, if Euros sufficient to pay the
Redemption Price of and accrued interest on Notes called for redemption shall
have been made available in accordance with the preceding paragraph, the Notes
called for redemption will cease to accrue interest and the only right of the
Holders of such Notes will be to receive payment of the Redemption Price of and,
subject to the first proviso in Section 3.04, accrued and unpaid interest on
such Notes to the Redemption Date. If any Note called for redemption shall not
be so paid, interest will continue to accrue and be paid, from the Redemption
Date until such redemption payment is made, on the unpaid principal of the Note
and any interest not paid on such unpaid principal, in each case, at the rate
and in the manner provided for in Section 2.12.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company
shall execute and the Trustee shall authenticate, at the expense of the Company,
for a Holder a new Note equal in principal amount to the unredeemed portion of
the Note surrendered.
Section 3.07. Redemption for Taxation Reasons.
All payments of principal, premium (if any), and interest in
respect of the Notes and of any other amounts payable pursuant to the Indenture
will be made without withholding or deduction for, or on account of, any present
or future taxes, duties, assessments or governmental charges of whatever nature
imposed or levied by or on behalf of the Netherlands or any political
subdivision or any authority thereof or therein having power to tax, unless the
withholding or deduction of such taxes, duties, assessments or governmental
charges is required by law. In that event, the Company will pay such additional
amounts ("Additional Amounts") as may be necessary in order that the net amounts
received by the Holders after such withholding or deduction shall equal the
respective amounts of principal, premium (if any), and interest and of any other
amounts payable pursuant to the Indenture that would have been receivable in
respect of the Notes in the absence of such withholding or deduction, except
that no Additional Amounts shall be payable in relation to any payment in
respect of any Note:
(1) to, or to a third party on behalf of, a Holder who is
liable for such taxes, duties, assessments, or governmental charges in
respect of such Note by reason of his having some connection with the
Netherlands other than the mere holding of the Note; or
(2) in the case of payments or principal, premium (if any), or
in terest in respect of the Notes made against presentation of the Note at
the specified office of a Paying Agent in the Netherlands; or
41
(3) in the case of payments of principal, premium (if any), or
interest in respect of the Notes presented for payment more than 30 days
after the date on which such payment first becomes due or, if the full
amount of the money payable has not been received by the Trustee or a
Paying Agent on or prior to such due date, the date on which, the full
amount of such money having been so received, notice to that effect shall
have been given to the Holders by the Trustee, except to the extent that
the Holder thereof would have been entitled to Additional Amounts on
presenting such Note for payment on the final day of such period of 30
days; or
(4) to, or to a third party on behalf of, a Holder who would
not be liable or subject to the withholding or deduction by making a
declaration of non-residence or other similar claim for exemption to the
relevant tax authority.
All, but not less than all, of the Notes may be redeemed, at the
option of the Company, at any time, upon giving notice to Holders as described
below (which notice shall be irrevocable), at a redemption price equal to 100%
of the principal amount thereof, together with interest accrued to the date
fixed for redemption, if the Company determines and certifies to the Trustee
immediately prior to the giving of such notice that on the occasion of the next
payment due in respect of the Notes the payment of Additional Amounts in respect
of such Notes would become required as a result of the provisions of this
clause. Prior to the giving of any notice of redemption described in this
paragraph, the Company shall deliver to the Trustee an Officer's Certificate
stating that the obligation to pay Additional Amounts cannot be avoided by the
Company taking reasonable measures available to it, and setting forth a
statement of facts showing that the conditions precedent to the right of the
Company so to redeem have occurred and the Trustee shall be entitled to accept
such Certificate as sufficient evidence of the satisfaction of the conditions
precedent set out above, in which event it shall be conclusive and binding on
the Holders. Notice of redemption shall be given to the Holders at least 30 but
not more than 60 days before the date fixed for redemption.
ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
The Company shall pay the principal of and interest (including
all Additional Interest as provided in the Registration Rights Agreement) on the
Notes on the dates and in the manner provided in the Notes and this Indenture.
An installment of principal or interest shall be considered paid on the date it
is due if the Trustee or Paying Agent holds, for the benefit of the Holders, on
that date Euros designated for and sufficient to pay such installment in full
and is not prohibited from paying such money to the Holders pursuant to the
terms of this Indenture.
The Company shall pay interest on overdue principal and
interest on overdue interest, to the extent lawful as provided for in
Section 2.11.
Section 4.02. Provision of Financial Statements and Other Information.
(a) The Company will file with the Commission all information,
documents and reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act and will provide
42
the Trustee and the Noteholders with copies of all such information, documents
and reports within 15 days of filing thereof with the Commission; provided that
if the Company is not required to file such information, documents or reports
with the Commission, it will nonetheless continue to furnish such information,
documents and reports required to be filed by a company subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act to the Trustee and the
Noteholders within 15 days of the date on which filing with the Commission would
have been otherwise required. The Company shall also comply with the provisions
of TIA (S) 314(a). Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
(b) The Company will, upon request, provide to any Holder or any
prospective transferee of any such Holder any information concerning the Company
(including financial statements) necessary in order to permit such Holder to
sell or transfer Notes in compliance with Rule 144 and Rule 144A under the
Securities Act.
Section 4.03. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead (as a defense or otherwise)
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 which would prohibit or forgive
the Company from paying all or any portion of the principal of, premium, if any,
and/or interest on the Notes 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 they may lawfully do so)
the Company hereby expressly waives all benefit or advantage of any such law,
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
Section 4.04. Compliance Certificate; Notice of Default; Tax Information.
(a) The Company shall deliver to the Trustee, within 90 days
after the end of the Company's fiscal year an Officers' Certificate (one of the
signers of which shall be the principal executive officer, principal financial
officer or principal accounting officer of each of the Company) stating that a
review of the activities of the Company and its Subsidiaries during such fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether a Default or Event of Default has occurred, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge no Default or Event of Default has occurred, listing all
Restricted Payments for such year, and if a Default or Event of Default shall
have occurred, describing all or such Defaults or Events of Default of which he
or she may have knowledge and what action each is taking or proposes to take
with respect thereto. The Officers' Certificate shall also notify the Trustee
should the Company elect to change the manner in which it fixes its fiscal year
end.
(b) [Intentionally Omitted]
(c) The annual financial statements delivered pursuant to
Section 4.02 shall be accompanied by a written report addressed to the Trustee
of the Company's independent accountants (who shall be a firm of established
international reputation) that in conducting their audit of such financial
statements nothing has come to their attention that would lead them to believe
that a Default or Event of Default has occurred under this Indenture insofar as
they relate to accounting matters or, if any such violation has occurred,
specifying the
43
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(d) (i) If any Default or Event of Default has occurred and is
continuing or (ii) if any Holder seeks to exercise any remedy hereunder with
respect to a claimed default under this indenture of the Notes, the Company
shall deliver to the Trustee, at its address set forth in Section 13.02 hereof,
by registered or certified mail or by telegram, telex or facsimile transmission
followed by hard copy by registered or certified mail an Officers' Certificate
specifying such Default or Event of Default, notice or other action, the status
thereof and what action the Company is taking or proposes to take within five
Business Days of its becoming aware of such occurrence.
(e) The Company shall calculate and deliver to the Trustee all
original issue discount information to be reported by the Trustee to Holders as
required by applicable law.
Section 4.05. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all material taxes,
assessments and governmental charges (including withholding taxes and any
penalties, interest and additions to taxes) levied or imposed upon it or any of
its Restricted Subsidiaries or properties of it or any of its Restricted
Subsidiaries and (ii) all lawful claims for labor, materials and supplies that,
if unpaid, might by law become a Lien upon the property of it or any of its
Restricted Subsidiaries; provided, however, that the Company shall not be
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings for which adequate reserves,
to the extent required under GAAP, have been taken.
Section 4.06. Corporate Existence.
Subject to Article 5 hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect (i)
its corporate existence, and the corporate, partnership or limited liability
company or other existence of each Restricted Subsidiary, in accordance with the
respective organizational documents (as the same may be amended from time to
time) of each Restricted Subsidiary and the material rights (charter and
statutory), licenses and franchises of the Company and its Restricted
Subsidiaries except where the failure to preserve and keep in full force and
effect any such rights, licenses and franchise shall not have a material adverse
effect on the financial condition, business, operations or prospects of the
Company and its Subsidiaries taken as a whole; and provided that the Company
shall not be required to preserve any such right, license or franchise, or the
corporate, limited liability company, partnership or other existence of any of
the Restricted Subsidiaries, if the Board of Directors of the Company shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries, taken as a whole,
and that the loss thereof is not adverse in any material respect to the Holders.
Section 4.07. Maintenance of Office or Agency.
The Company shall maintain an office or agency in the Borough of
Manhattan, The City of New York, in London, England and, so long as the Notes
are listed on the Luxembourg Stock Exchange and the rules of such stock exchange
require, in Luxembourg where Notes may be surrendered for registration of
transfer or exchange or for presentation for payment and where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company
44
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the address of the Trustee as set
forth in Section 13.02.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations.
The Company shall give prompt written notice to the Trustee of such designation
or rescission and of any change in the location of any such other office or
agency.
The Company hereby initially designates the Corporate Trust
Offices of the Trustee set forth in Section 13.02 as such office of the Company
in the Borough of Manhattan, The City of New York and in London, England and the
office of the Luxembourg Paying Agent set forth in Section 13.02 as such office
of the Company in Luxembourg.
Section 4.08. Compliance with Laws.
The Company shall comply, and shall cause each of its Restricted
Subsidiaries to comply, with all applicable statutes, rules, regulations, orders
and restrictions of the United States of America and all other sovereign
nations, all states and municipalities thereof, and of any governmental
department, commission, board, regulatory authority, bureau, agency and
instrumentality of the foregoing, in respect of the conduct of their respective
businesses and the ownership of their respective properties, except for such
noncompliances as would not in the aggregate have a material adverse effect on
the financial condition or results of operations of the Company and its
Restricted Subsidiaries taken as a whole.
Section 4.09. Maintenance of Properties and Insurance.
(a) Subject to Article 5 hereof, the Company shall cause all
material properties owned by or leased by it or any of its Restricted
Subsidiaries used or useful to the conduct of the Company's business or the
business of any of its Restricted Subsidiaries to be maintained and kept in
normal condition, repair and working order and supplied with all necessary
equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in its judgment may
be necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
nothing in this Section 4.09 shall prevent the Company or any of its Restricted
Subsidiaries from discontinuing the use, operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal is,
in the judgment of the Board of Directors of the Company or of the Board of
Directors of the Restricted Subsidiary of the Company concerned, or of an
officer (or other agent employed by the Company or of any Restricted Subsidiary)
of the Company or such Restricted Subsidiary having managerial responsibility
for any such property, desirable in the conduct of the business of the Company
or any Restricted Subsidiary of the Company.
(b) The Company shall maintain, and shall cause the Restricted
Subsidiaries to maintain, insurance with responsible carriers against such risks
and in such amounts, and with such deductibles, retentions, self-insured amounts
and co-insurance provisions, as, in the reasonable judgment of the Company, may
be necessary.
45
Section 4.10. Limitation on Additional Indebtedness.
(A) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, incur (as defined) any
Indebtedness (including Acquired Indebtedness); provided that the Company or any
of Restricted Subsidiaries may incur Indebtedness (including Acquired
Indebtedness) if after giving effect to the incurrence of such Indebtedness and
the receipt and application of the proceeds thereof, the Company's Consolidated
Fixed Charge Coverage Ratio is at least 2.5 to 1.
(B) Notwithstanding the foregoing clause (A), the Company and its
Restricted Subsidiaries may incur Permitted Indebtedness; provided that the
Company will not incur any Permitted Indebtedness that ranks junior in right of
payment to the Notes that has a maturity or mandatory sinking fund payment prior
to the maturity of the Notes. Notwithstanding any other provision of this
Section 4.10, (i) the maximum amount of Indebtedness that the Company or a
Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to
be exceeded, with respect to any outstanding Indebtedness, due solely to the
result of fluctuations in the exchange rates of currencies and (ii) in the event
that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Indebtedness or is otherwise entitled to be incurred
pursuant to this Section 4.10, the Company may, in its sole discretion, classify
(or reclassify) such item of Indebtedness in any manner that complies with this
Section 4.10 and such items of Indebtedness will be treated as having been
incurred pursuant to only one of such clauses or pursuant to the first paragraph
hereof. Accrual of interest, accretion or amortization of original issue
discount, and the payment of interest in the form of additional Indebtedness,
will not be deemed to be an incurrence of Indebtedness for purposes of this
Section 4.10 and accruals of mandatory dividends or the payment of mandatory
dividends on Disqualified Capital Stock in the form of additional shares of the
same class of Disqualified Capital Stock will not be deemed an issuance of
Disqualified Capital Stock for purposes of this Section 4.10.
Section 4.11. Limitation on Restricted Payments.
(A) The Company will not make, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, make, any Restricted
Payment, unless:
(1) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
Restricted Payment;
(2) immediately after giving pro forma effect to such
Restricted Payment, the Company could incur (Euro)1.00 of additional
Indebtedness (other than Permitted Indebtedness) under Section 4.10 of this
Indenture; and
(3) immediately after giving effect to such Restricted Payment,
the aggregate of all Restricted Payments declared or made after the Issue
Date does not exceed the sum of
(a) 50% of the Company's Cumulative Consolidated Net
Income (or minus 100% of any cumulative deficit in Consolidated
Net Income during such period), provided that for purposes of
this Section 4.10 the Company's Cumulative Consolidated Net
Income shall include the net income (loss) of PalEx from
January 1, 2000,
(b) 100% of the aggregate Net Proceeds received by the
Company from the issue or sale after the Issue Date of Capital
Stock (other than any Disqualified Capital Stock or Capital Stock
of the Company issued to any Subsidiary of the Company) of the
Company or any In-
46
debtedness or other securities of the Company convertible into or
exercisable or exchangeable for Capital Stock (other than
Disqualified) of the Company which have been so converted,
exercised or exchanged, as the case may be,
(c) without duplication of any amounts included in clause
(3)(b) above, 100% of the aggregate Net Proceeds received by the
Company from any equity contribution from a holder of the
Company's Capital Stock, excluding, in the case of clauses (3)(b)
and (c), any Net Proceeds from a Equity Offering to the extent
used to redeem the Notes, and
(d) without duplication, the sum of
(i) 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,
(ii) the net proceeds received by the Company or any
of its Restricted Subsidiaries from the disposition,
retirement or redemption of all or any portion of such
Investments (other than to a Subsidiary of the Company), and
(iii) upon redesignation of an Unrestricted
Subsidiary as a Restricted Subsidiary, the fair market value
of the net assets of such Subsidiary;
provided, however, that the sum of clauses (i), (ii) and (iii)
above shall not exceed the aggregate amount of all such
Investments made subsequent to the Issue Date.
For purposes of determining under clause (3) above, the amount
expended for Restricted Payments, cash distributed shall be valued at the face
amount thereof and property other than cash shall be valued at its fair market
value.
(B) The provisions of this Section 4.11 shall not prohibit:
(1) the payment of any distribution within 60 days after the
date of declaration thereof, if at such date of declaration such payment
would comply with the provisions of this Indenture;
(2) the repurchase, redemption or other acquisition or
retirement of any shares of Capital Stock of the Company or Indebtedness
subordinated to the Notes by conversion into, or by or in exchange for,
shares of Capital Stock of the Company (other than Disqualified Capital
Stock), or out of the Net Proceeds of the substantially concurrent sale
(other than to a Subsidiary of the Company) of other shares of Capital
Stock of the Company (other than Disqualified Capital Stock);
(3) the redemption or retirement of Indebtedness of the Company
subordinated to the Notes in exchange for, by conversion into, or out of
the Net Proceeds of a substantially concurrent sale or incurrence of,
Indebtedness of the Company (other than any Indebtedness owed to a
Subsidiary) that is Refinancing Indebtedness;
(4) the retirement of any shares of Disqualified Capital Stock
of the Company by conversion into, or by exchange for, shares of
Disqualified Capital Stock of the Company, or out of the Net
47
Proceeds of the substantially concurrent sale (other than to a Subsidiary
of the Company) of other shares of Disqualified Capital Stock of the
Company;
(5) payments made to effect the Transactions;
(6) repurchases by the Company of Capital Stock (other than
Disqualified Capital Stock) (or options therefor) of the Company from
directors, officers, or employees of the Company or any of its Restricted
Subsidiaries or their authorized representatives upon the death,
disability, termination of employment of such officers or employees, in an
aggregate amount not to exceed, in any calendar year, (Euro)1.0 million;
(7) loans and advances to officers and other employees of the
Company or any of its Restricted Subsidiaries for the exercise of stock
options in any amount not to exceed (Euro)1.0 million at any one time
outstanding;
(8) the exchange by the Company of the SMG Exchangeable Shares
for cash and/or Capital Stock of the Company (other than Disqualified
Capital Stock of the Company) as elected by a holder of SMG Exchangeable
Shares on or before the Issue Date; and
(9) other Restricted Payments in an aggregate amount since the
Issue Date not to exceed (Euro)2.0 million.
In calculating the aggregate amount of Restricted Payments made
subsequent to the Issue Date for purposes of clause (3) of the first paragraph
above, amounts expended pursuant to clause (1) of the immediately preceding
paragraph shall be included in such calculation.
(C) For purposes of determining compliance with this Section
4.11, in the event that a Restricted Payment meets the criteria of more than one
of the types of Restricted Payments described in the above clauses, the Company,
in its sole discretion, may order and classify, and from time to time may
reclassify, such Restricted Payment if it would have been permitted at the time
such Restricted Payment was made and at the time of such reclassification.
Section 4.12. Limitation on Other Senior Subordinated Indebtedness.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, incur, contingently or otherwise, any
Indebtedness (other than the Notes and the Guarantees, as the case may be) that
is both (i) subordinated in right of payment to any Senior Debt of the Company
or any of its Restricted Subsidiaries, as the case may be, and (ii) senior in
right of payment to the Notes and the Guarantees, as the case may be. For
purposes of this Section 4.12, Indebtedness is deemed to be senior in right of
payment to the Notes or the Guarantees, as the case may be, if it is not
explicitly subordinated in right of payment to Senior Debt at least to the same
extent as the Notes and the Guarantees, as the case may be, are subordinated to
such Senior Debt.
Section 4.13. Limitation on Certain Asset Sales.
(A) The Company will not, and will not permit any of its
Restricted Subsidiaries to, consummate an Asset Sale unless:
48
(1) the Company or such Restricted Subsidiary, as the case may
be, receives consideration at the time of such sale or other disposition at
least equal to the fair market value of the assets sold or otherwise
disposed of (as determined in good faith by the Board of Directors of the
Company, and evidenced by a Board Resolution);
(2) not less than 75% of the consideration received by the
Company or such Restricted Subsidiary, as the case may be, is in the form
of cash or Cash Equivalents other than in the case where the Company or
such Restricted Subsidiary is undertaking a Permitted Asset Swap; and
(3) the Asset Sale Proceeds received by the Company or such
Restricted Subsidiary are applied
(a) to the extent the Company or any such Restricted
Subsidiary, as the case may be, elects, or is required, to
prepay, repay or purchase Indebtedness under any then existing
Senior Debt of the Company or any such Restricted Subsidiary
within 360 days following the receipt of the Asset Sale Proceeds
from any Asset Sale; provided that any such repayment shall
result in a permanent reduction of the commitments thereunder in
an amount equal to the principal amount so repaid,
(b) to the extent the Company elects, to an investment in
assets (including Capital Stock or other securities purchased in
connection with the acquisition of Capital Stock or property of
another Person) used or useful in its Business; provided that
such investment occurs or the Company or any such Restricted
Subsidiary enters into contractual commitments to make such
investment, subject only to customary conditions, within 270 days
following receipt of such Asset Sale Proceeds (provided that such
investment shall in any event be consummated no later than 90
days following such 270th day), and
(c) if on such 360th day in the case of clauses (3)(a) or
the 270th day in the case of clause (3)(b) (or on such 90th day
in the case of the proviso to clause (3)(b)) with respect to any
Asset Sale, the Available Asset Sale Proceeds exceed (Euro)10
million, the Company shall apply an amount equal to the Available
Asset Sale Proceeds to an offer to repurchase the Notes, at a
purchase price in cash equal to 100% of the principal amount
thereof plus accrued and unpaid interest, if any, to the purchase
date (an "Excess Proceeds Offer").
Notwithstanding the foregoing, in the event that a Restricted
Subsidiary that is not a Wholly Owned Restricted Subsidiary dividends or
distributes to all of its stockholders on a pro rata basis any proceeds of an
Asset Sale to the Company or another Restricted Subsidiary, the Company or such
Restricted Subsidiary need only apply its share of such proceeds in accordance
with the preceding clauses (a), (b) and (c).
If an Excess Proceeds Offer is not fully subscribed, the
Company may retain the portion of the Available Asset Sale Proceeds not required
to repurchase Notes.
(B) If the Company is required to make an Excess Proceeds Offer,
the Company shall mail, within 30 days following the date specified in clause
(3)(c) above, a notice to the holders. Such notice shall be sent by first-class
mail, postage prepaid, to the Trustee and to each Noteholder, at the address
appearing in the register maintained by the Registrar of the Notes, and shall
state:
(1) that the Excess Proceeds Offer is being made pursuant to
this Section 4.13;
49
(2) that such Holders have the right to require the Company to
apply the Available Asset Sale Proceeds to repurchase such Notes at a
purchase price in cash equal to 100% of the principal amount thereof plus
accrued and unpaid interest, if any, to the purchase date which shall be no
earlier than 30 days and not later than 60 days from the date such notice
is mailed (the "Excess Proceeds Payment Date");
(3) that any Note not tendered or accepted for payment will
continue to accrue interest;
(4) that any Notes accepted for payment pursuant to the Excess
Proceeds Offer shall cease to accrue interest after the Excess Proceeds
Payment Date;
(5) that Holders accepting the offer to have their Notes
purchased pursuant to an Excess Proceeds Offer will be required to
surrender the Notes, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Note completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
Business Day preceding the Excess Proceeds Payment Date;
(6) that Holders will be entitled to withdraw their acceptance
of the Excess Proceeds Offer if the Paying Agent receives, not later than
the close of business on the third Business Day preceding the Excess
Proceeds Payment Date, a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount of the Notes
delivered for purchase, and a statement that such Holder is withdrawing his
election to have such Notes purchased;
(7) that if the aggregate principal amount of Notes surrendered
by Holders exceeds the amount of Excess Proceeds, Company shall select the
Notes to be purchased on a pro rata basis (with such adjustments as may be
deemed appropriate by the Company so that only Notes in denominations of
(Euro)1,000 or integral multiples thereof, shall be purchased);
(8) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered, provided that each Note purchased and
each such new Note issued shall be in an original principal amount in
minimum denominations of (Euro)50,000 and in increments of (Euro)1,000
above (Euro)50,000;
(9) the calculations used in determining the amount of
Available Asset Sale Proceeds to be applied to the purchase of such Notes;
(10) any other procedures that a Holder must follow to accept
an Excess Proceeds Offer or effect withdrawal of such acceptance; and
(11) the name and address of the Paying Agent.
On the Excess Proceeds Payment Date, the Company shall, to the
extent lawful, (1) accept for payment, on a pro rata basis to the extent
necessary, Notes or portions thereof tendered pursuant to the Excess Proceeds
Offer, (2) deposit with the Paying Agent Euros sufficient to pay the purchase
price plus accrued and unpaid interest, if any, on the Notes to be purchased or
portions thereof, (3) deliver or cause to be delivered to the Trustee Notes so
accepted together with an Officers' Certificate stating that such Notes or
portions thereof were accepted for payment by the Company in accordance with the
terms of this Section 4.13. The Paying Agent shall promptly mail to each Holder
so accepted payment in an amount equal to the purchase price for such
50
Notes, and the Company shall execute and issue, and the Trustee shall promptly
authenticate and make available for delivery to such Holder, a new Note equal in
principal amount to any unpurchased portion of the Notes surrendered; provided
that each such new Note shall be issued in an original principal amount in
minimum denominations of (Euro)50,000 and in increments of (Euro)1,000 above
(Euro)50,000. The Company will publicly announce the results of the Excess
Proceeds Offer on the Excess Proceeds Payment Date.
(C) In the event of the transfer of substantially 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 5.01 of this
Indenture, the successor Person shall be deemed to have sold the properties and
assets of the Company and its Restricted Subsidiaries not so transferred for
purposes of this Section 4.13, and shall comply with the provisions set forth in
clauses 3(a), 3(b) and 3(c) of this Section 4.13 with respect to such deemed
sale as if it were an Asset Sale.
(D) The Company will comply with the requirements of Rule 14e-1
under the Exchange Act and other securities laws and regulations thereunder to
the extent such laws and regulations are applicable in connection with the
repurchase of Notes pursuant to an Excess Proceeds Offer. To the extent that the
provisions of any securities laws or regulations conflict with this Section
4.13, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 4.13 by virtue thereof.
Section 4.14. Limitation on Transactions with Affiliates.
(A) The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, property or
services) with any Affiliate (each an "Affiliate Transaction") unless:
(1) such Affiliate Transaction is between or among the Company
and its Restricted Subsidiaries; or
(2) the terms of such Affiliate Transaction are fair and
reasonable to the Company or such Restricted Subsidiary, as the case may
be, and the terms of such Affiliate Transaction are at least as favorable
as the terms which could be obtained by the Company or such Restricted
Subsidiary, as the case may be, in a comparable transaction made on an
arm's-length basis between unaffiliated parties.
In any Affiliate Transaction (or any series of related Affiliate
Transactions that are similar or part of a common plan) involving an amount or
having a fair market value in excess of (Euro)2,000,000 that is not permitted
under clause (1) above, the Company must obtain a resolution of the Board of
Directors of the Company certifying that such Affiliate Transaction complies
with clause (2) above. In any Affiliate Transaction (or any series of related
Affiliate Transactions which are similar or part of a common plan) involving an
amount or having a fair market value in excess of (Euro)5,000,000 that is not
permitted under clause (1) above, the Company must obtain a favorable written
opinion as to the fairness of such transaction or transactions, as the case may
be, from an Independent Financial Advisor.
(B) The foregoing provisions will not apply to:
(1) reasonable fees and compensation and customary expense
reimbursement paid to, and indemnity provided on behalf of, officers,
directors, employees, or consultants of the Company or any
51
Restricted Subsidiary of the Company as determined in good faith by the
Company's board of directors or senior management;
(2) any agreement as in effect as of the Issue Date (including,
without limitation, any agreement entered into on the Issue Date in
connection with the Transactions) or any amendment thereto or any
transaction contemplated thereby (including pursuant to any amendment
thereto) in any replacement agreement thereto so long as any such amendment
or replacement agreement is not more disadvantageous to the holders in any
material respect than the original agreement as in effect on the Issue
Date;
(3) loans and advances to employees or officers of the Company
and its Restricted Subsidiaries permitted by clause (3) of the definition
of "Permitted Investments";
(4) Restricted Payments permitted by the Indenture;
(5) transactions with Affiliates solely in their capacity as
holders of Indebtedness or Capital Stock of the Company or any of its
Subsidiaries, so long as such Affiliates are treated no more favorably than
holders of such Indebtedness or Capital Stock generally; or
(6) transactions with a Receivables Subsidiary in connection
with Permitted Receivables Financing.
Section 4.15. Limitations on Liens.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, create, incur or otherwise cause or suffer to exist or become
effective any Liens of any kind securing Indebtedness other than Senior Debt
upon any property or asset of the Company or any of its Restricted Subsidiaries
or any shares of Capital Stock or Indebtedness of any Restricted Subsidiary of
the Company which owns property or assets, now owned or hereafter acquired,
unless:
(1) if such Lien secures Indebtedness which is subordinated to
the Notes, any such Lien shall be subordinated to the Lien granted to the
holders of the Notes to the same extent as such Indebtedness is
subordinated to the Notes; and
(2) in all other cases, the Notes are equally and ratably
secured, except for
(a) Liens existing as of the Issue Date to the extent and
in the manner such Liens are in effect on the Issue Date,
(b) Liens of the Company or a Wholly Owned Restricted
Subsidiary of the Company on assets of any Restricted Subsidiary,
(c) Liens securing Refinancing Indebtedness that is
incurred to Refinance any Indebtedness that has been secured by a
Lien permitted under the Indenture and that has been incurred in
accordance with the provisions of the Indenture, provided,
however, that such Liens: (i) are no less favorable to the
Holders and are not more favorable to the lienholders with
respect to such Liens than the Liens in respect of the
Indebtedness as being Refinanced; and (ii)
52
do not extend to or cover any property or assets of the Company or
any of its Restricted Subsidiaries not securing the Indebtedness
so Refinanced, and
(d) Permitted Liens.
Section 4.16. Limitations on Investments.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, make any Investment other than:
(1) a Permitted Investment; or
(2) an Investment that is made after the Issue Date as a
Restricted Payment in compliance with Section 4.11.
Section 4.17. Change of Control Offer.
(A) Upon the occurrence of a Change of Control, the Company
shall be obligated to make an offer to purchase (the "Change of Control Offer")
each Holder's outstanding Notes at a purchase price (the "Change of Control
Purchase Price") equal to 101% of the principal amount thereof plus accrued and
unpaid interest, if any, to the Change of Control Payment Date (as defined) in
accordance with the procedures set forth below.
(B) Within 30 days of the occurrence of a Change of Control, the
Company shall send by first-class mail, postage prepaid, to the Trustee and to
each Holder of the Notes, at the address appearing in the register maintained by
the Registrar of the Notes and so long as the Notes are listed on the Luxembourg
Stock Exchange, and the rules of the Luxembourg Stock Exchange require, publish
in a Luxembourg newspaper of general circulation, a notice stating:
(1) that the Change of Control Offer is being made pursuant to
this Section 4.17 and that all Notes tendered will be accepted for payment;
(2) the Change of Control Purchase Price and the purchase date
(which shall be a Business Day no earlier than 30 days nor later than 60
days from the date such notice is mailed (the "Change of Control Payment
Date"));
(3) that any Note not tendered will continue to accrue interest;
(4) that, unless the Company defaults in the payment of the
Change of Control Purchase Price, any Notes accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest after the
Change of Control Payment Date;
(5) that Holders accepting the offer to have their Notes
purchased pursuant to a Change of Control Offer will be required to
surrender the Notes to the Paying Agent at the address specified in the
notice prior to the close of business on the Business Day preceding the
Change of Control Payment Date;
53
(6) that Holders will be entitled to withdraw their acceptance
if the Paying Agent receives, not later than the close of business on the
third Business Day preceding the Change of Control Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Notes delivered for purchase, and a
statement that such holder is withdrawing his election to have such Notes
purchased;
(7) that Holders whose Notes are being purchased only in part
will be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered;
(8) any other procedures that a Holder must follow to accept a
Change of Control Offer or effect withdrawal of such acceptance; and
(9) the name and address of the Paying Agent.
On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment Notes or portions thereof tendered
pursuant to the Change of Control Offer, (2) deposit with the Paying Agent Euros
sufficient to pay the purchase price of all Notes or portions thereof so
tendered and (3) deliver or cause to be delivered to the Trustee Notes so
accepted together with an Officers' Certificate stating the Notes or portions
thereof tendered to the Company. The Paying Agent shall promptly mail to each
Holder of Notes so accepted payment in an amount equal to the purchase price for
such Notes, and the Company shall execute and issue, and the Trustee shall
promptly authenticate and mail to such Holder, a new Note equal in principal
amount to any unpurchased portion of the Notes surrendered; provided that each
such new Note shall be issued in an original principal amount in minimum
denominations of (Euro)50,000 and in increments of (Euro)1,000 above
(Euro)50,000.
(C) If the New Senior Credit Facility is in effect, or any
amounts are owing thereunder or in respect thereof, at the time of the
occurrence of a Change of Control, prior to the mailing of the notice to Holders
described in the second preceding paragraph, the Company covenants to:
(1) repay in full all obligations and terminate all commitments
under or in respect of the New Senior Credit Facility and all other Senior
Debt the terms of which require repayment upon a Change of Control or offer
to repay in full all obligations and terminate all commitments under or in
respect of the New Senior Credit Facility and all such Senior Debt and
repay the Indebtedness owed to each such lender who has accepted such
offer; or
(2) obtain the requisite consents under the New Senior Credit
Facility and all such other Senior Debt to permit the repurchase of the
Notes as described above.
The Company must first comply with the covenant described in the
preceding sentence before it shall be required to purchase Notes in the event of
a Change of Control; provided that, notwithstanding the foregoing, the Company's
failure to consummate a Change of Control Offer in accordance with the
provisions of this Section 4.17 due to the covenant described in the immediately
preceding sentence shall constitute an Event of Default described in clause (c)
under Section 6.01 after the notice required by such clause. As a result of the
foregoing, a holder of the Notes may not be able to compel the Company to
purchase the Notes unless the Company is able at the time to refinance all of
the obligations under or in respect of the New Senior Credit Facility and all
such other Senior Debt or obtain requisite consents under the New Senior Credit
Facility and all such other Senior Debt.
54
(D) (1) If the Company or any Restricted Subsidiary thereof has
issued any outstanding (a) Indebtedness that is subordinated in right of payment
to the Notes or (b) Preferred Stock, and the Company or such Restricted
Subsidiary is required to make a Change of Control Offer or to make a
distribution with respect to such subordinated Indebtedness or Preferred Stock
in the event of a Change of Control, the Company shall not consummate any such
offer or distribution with respect to such subordinated Indebtedness or
Preferred Stock until such time as the Company shall have paid the Change of
Control Purchase Price in full to the Holders of Notes that have accepted the
Company's Change of Control Offer and shall otherwise have consummated the
Change of Control Offer made to Holders of the Notes and (2) the Company will
not issue Indebtedness that is subordinated in right of payment to the Notes or
Preferred Stock with change of control provisions requiring the payment of such
Indebtedness or Preferred Stock prior to the payment of the Notes tendered
pursuant to a Change of Control Offer in the event of a Change in Control under
this Indenture.
(E) 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 Change of Control Offer. To the extent that
the provisions of any securities laws or regulations conflict with this Section
4.17, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under this
Section 4.17 by virtue thereof.
Section 4.18. Limitation on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary of the Company to:
(1) pay dividends or make any other distributions to the
Company or any Restricted Subsidiary of the Company
(a) on its Capital Stock, or
(b) with respect to any other interest or participation
in, or measured by, its profits, or
(2) repay any Indebtedness or any other obligation owed to the
Company or any Restricted Subsidiary of the Company,
(3) make loans or advances or capital contributions to the
Company or any of its Restricted Subsidiaries or
(4) transfer any of its properties or assets to the Company or
any of its Restricted Subsidiaries,
except for such encumbrances or restrictions existing under or by reason of:
(1) encumbrances or restrictions existing on the Issue Date to
the extent and in the manner such encumbrances and restrictions are in
effect on the Issue Date,
55
(2) the Indenture, the Notes and the Guarantees,
(3) applicable law,
(4) contracts to which any Person who is acquired in accordance
with the terms of this Indenture is a party, including any instrument
governing Acquired Indebtedness or Capital Stock, which encumbrance or
restriction is not applicable to any Person, or the properties or assets of
any Person, other than the Person, or the property or assets of the Person
(including any Subsidiary of the Person), so acquired,
(5) customary non-assignment provisions in leases or other
agreements entered in the ordinary course of business and consistent with
past practices,
(6) Refinancing Indebtedness; provided that such restrictions
are no more restrictive than those contained in the agreements governing
the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded,
(7) customary restrictions in Capitalized Lease Obligations,
security agreements or mortgages securing Indebtedness of the Company or a
Restricted Subsidiary to the extent such restrictions restrict the transfer
of the property subject to such Capitalized Lease Obligations, security
agreements and mortgages,
(8) customary restrictions with respect to a Restricted
Subsidiary of the Company pursuant to an agreement that has been entered
into for the sale or disposition of all or substantially all of the Capital
Stock or assets of such Restricted Subsidiary,
(9) contracts entered into in the ordinary course of business,
not relating to any Indebtedness, and that do not, individually or in the
aggregate, detract from the value of property or assets of the Company or
any Restricted Subsidiary in any manner material to the Company or any
Restricted Subsidiary,
(10) restrictions on cash or other deposits or net worth imposed
by customers under contracts (not evidencing or relating to Indebtedness)
entered into the ordinary course of business,
(11) 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,
(12) customary provisions restricting dispositions of real
property interests set forth in any reciprocal easement agreements of the
Company or any Restricted Subsidiary, or
(13) with respect to a Receivables Subsidiary, an agreement
relating to Indebtedness of such Receivables Subsidiary which is permitted
under Section 4.10 or pursuant to an agreement relating to a Permitted
Receivables Financing by such Receivables Subsidiary.
56
Section 4.19. Limitation on Preferred Stock of Restricted Subsidiaries.
The Company will not permit any of its Restricted Subsidiaries
that are not Guarantors to issue any Preferred Stock (except Preferred Stock
issued to the Company or 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 hold any such Preferred Stock unless such
Restricted Subsidiary would be entitled to incur or assume Indebtedness under
Section 4.10 (other than Permitted Indebtedness) in the aggregate principal
amount equal to the aggregate liquidation value as of the date of issuance
thereof of the Preferred Stock to be issued.
Section 4.20. Limitation on Creation of Subsidiaries.
The Company will not create or acquire, and will not permit any
of its Restricted Subsidiaries to create or acquire, any Subsidiary other than:
(1) a Restricted Subsidiary existing as of the Issue Date;
(2) a Restricted Subsidiary that is acquired or created after
the Issue Date; provided, however, that each Restricted Subsidiary other
than an Immaterial Subsidiary acquired or created pursuant to this clause
(2) shall have executed a guarantee, pursuant to which such Restricted
Subsidiary will become a Guarantor; provided, further, in the event the
Company or any of its Restricted Subsidiaries incurs Acquired Indebtedness
(assuming such incurrence is in accordance with Section 4.10) as a result
of the acquisition of a Restricted Subsidiary and as long as the terms of
such Acquired Indebtedness prohibit the Guarantee of the Notes by such
newly-acquired Restricted Subsidiary or such newly-acquired Restricted
Subsidiary would be in breach or default of the terms of the Acquired
Indebtedness as a result of such Guarantee, such Restricted Subsidiary will
not be required to execute a Guarantee; provided that, until such
Restricted Subsidiary executes and delivers a Guarantee in accordance with
this Section 4.20, (a) none of the Company or any other Restricted
Subsidiary of the Company will transfer any assets (other than in the
ordinary course of business) to such newly-acquired Restricted Subsidiary,
(b) such newly-acquired Restricted Subsidiary will not transfer such
Acquired Indebtedness to the Company or any other Restricted Subsidiary and
(c) neither the Company nor any Restricted Subsidiary of the Company shall
provide any guarantee of, or similar credit support for, or otherwise
become directly or indirectly liable for any Indebtedness of such newly-
acquired Restricted Subsidiary; or
(3) an Unrestricted Subsidiary.
Section 4.21. Limitation on Sale and Lease-Back Transactions.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, enter into any Sale and Lease-Back Transaction unless:
(1) the consideration received in such Sale and Lease-Back
Transaction is at least equal to the fair market value of the property
sold, as determined in good faith by the board of directors of the Company
and evidenced by a board resolution; and
(2) the Company could incur the Attributable Indebtedness in
respect of such Sale and Lease-Back Transaction in compliance with
Section 4.10.
57
Section 4.22. Payments for Consent.
The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any holder of
any Notes for or as an inducement to any consent, waiver or amendment of any of
the terms or provisions of the Indenture or the Notes unless such consideration
is offered to be paid or agreed to be paid to all holders of the Notes that so
consent, waive, or agree to amend in the time frame set forth in solicitation
documents relating to such consent, waiver or agreement.
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation, Merger and Sale of Assets.
The Company will not and will not permit any of its Restricted
Subsidiaries to consolidate with, merge with or into, or sell, assign, transfer,
lease, convey or otherwise dispose of all or substantially all of the assets of
the Company and its Restricted Subsidiaries (as an entirety or substantially as
an entirety in one transaction or a series of related transactions), to any
Person unless:
(1) the Company or such Restricted Subsidiary, as the case may
be, shall be the continuing Person, or the Person (if other than the
Company or such Restricted Subsidiary) formed by such consolidation or into
which the Company or such Restricted Subsidiary, as the case may be, is
merged or to which the properties and assets of the Company or such
Restricted Subsidiary, as the case may be, are sold, assigned, transferred,
leased, conveyed or otherwise disposed of (the "Successor Person") shall be
a corporation organized and existing under the laws of any member state of
the European Union, Switzerland, or any state of the United States of
America or the District of Columbia and shall expressly assume, by a
supplemental indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all of the obligations of the Company or such
Restricted Subsidiary, as the case may be, under the Indenture, the Notes
and the Guarantees, and the obligations thereunder shall remain in full
force and effect;
(2) immediately before and immediately after giving effect to
such transaction, no Default or Event of Default shall have occurred and be
continuing; and
(3) immediately after giving effect to such transaction on a
pro forma basis the Company or such Person could incur at least (Euro)1.00
of additional Indebtedness (other than Permitted Indebtedness) under
Section 4.10; provided that a Guarantor may merge into the Company or
another Person that is a Guarantor without complying with this clause (3).
In connection with any consolidation, merger or transfer of
assets contemplated by this Section 5.01, the Successor Person shall deliver, or
cause to be delivered, to the Trustee, in form and substance reasonably
satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel
each stating that such consolidation, merger or transfer and the supplemental
indenture in respect thereto comply with this Section 5.01 and that all
conditions precedent herein provided for relating to such transaction or
transactions have
58
been complied with and that this Indenture constitutes a legal, valid and
binding obligation of such Successor Corporation and such other information as
the Trustee may reasonable request.
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.
Section 5.02. Successor Person Substituted.
Upon any consolidation, merger, conveyance or any transfer of
all or substantially all of the assets of the Company in accordance with Section
5.01 above, the successor entity formed by such consolidation or into which the
Company or any such Restricted Subsidiary is merged or to which such transfer is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company or such Restricted Subsidiary, as the case may be, under
this Indenture with the same effect as if such successor entity had been named
as the Company or such Restricted Subsidiary, as the case may be herein, and
thereafter the predecessor entity shall be relieved of all obligations and
covenants under this Indenture and the Notes.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) there is a default in the payment of any principal of, or
premium, if any, on the Notes when the same becomes due and payable at
maturity, upon acceleration, redemption or otherwise (whether or not such
payment is prohibited by the provisions of Article 12 hereof);
(b) there is a default in the payment of any interest on any
Note when the same becomes due and payable and the default continues for a
period of 30 calendar days (whether or not such payment is prohibited by
the provisions of Article 12 hereof);
(c) there is a default by the Company or any Restricted
Subsidiary in the observance or performance of any other covenant in the
Notes or this Indenture for 30 calendar days after written notice from the
Trustee or the Holders of not less than 25% in aggregate principal amount
of the Notes then outstanding (except in the case of a default with respect
to Sections 4.17 or 5.01 which shall constitute an Event of Default with
such notice requirement but without such passage of time requirement);
(d) there is a failure to pay at final maturity (giving effect
to any applicable grace periods and any extensions thereof) the 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 if the aggregate principal amount of such Indebtedness,
together with the principal amount of any other
59
such Indebtedness in default for failure to pay principal at final maturity
or which has been accelerated, aggregates (Euro)10.0 million or more at any
time;
(e) any final judgment or judgments (not covered by insurance)
which can no longer be appealed for the payment of money in excess of
(Euro)10,000,000 shall be rendered against the Company or any Restricted
Subsidiary thereof, and shall not be discharged for any period of 60
consecutive calendar days during which a stay of enforcement shall not be
in effect;
(f) the Company or any Significant Restricted Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against
it in an involuntary case,
(C) consents to the appointment of a Custodian of it or
for all or substantially all of its Property,
(D) makes a general assignment for the benefit of its
creditors,
(E) generally is not able to pay its debts as they become
due, or
(F) takes any corporate action to authorize or effect any
of the foregoing;
(g) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Restricted Subsidiary in an involuntary case,
(B) appoints a Custodian of the Company or any Significant
Restricted Subsidiary or for all or substantially all of the
Property of the Company or any Significant Restricted Subsidiary,
or
(C) orders the liquidation of the Company or any Significant
Restricted Subsidiary,
and the order or decree remains unstayed and in effect for 60 days; and
(h) any Guarantee of a Guarantor that is a Significant Restricted
Subsidiary ceases to be in full force and effect or any Guarantee of a
Guarantor that is a Significant Restricted Subsidiary is declared to be
null and void and unenforceable or any Guarantee of a Guarantor that is a
Significant Restricted Subsidiary is found to be invalid or any of the
Guarantors that is a Significant Restricted Subsidiary denies its liability
under its Guarantee (other than by reason of release of a Guarantor in
accordance with the terms of this Indenture).
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The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
Section 6.02. Acceleration.
If an Event of Default (other than an Event of Default of the type
described in Section 6.01(f) or (g)) shall have occurred and be continuing, then
the Trustee or the Holders of not less than 25% in aggregate principal amount of
the Notes then outstanding may declare to be immediately due and payable the
entire principal amount of all the Notes then outstanding plus accrued interest
to the date of acceleration and the same shall become immediately due and
payable; provided, however, that after such acceleration but before a judgment
or decree based on such acceleration is obtained by the Trustee, the Holders of
a majority in aggregate principal amount of outstanding Notes may rescind and
annul such acceleration if:
(1) all Events of Default, other than nonpayment of principal, premium,
if any, or interest that has become due solely because of the
acceleration, have been cured or waived;
(2) to the extent the payment of such interest is lawful, interest on
overdue installments of interest and overdue principal, which has
become due otherwise than by such declaration of acceleration, has
been paid;
(3) the Company has paid the Trustee its reasonable compensation and
reimbursed the Trustee for its expenses, disbursements and
advances; and
(4) in the event of the cure or waiver of an Event of Default of the
type described in Section 6.01(f) or (g) above, the Trustee shall
have received an Officers' Certificate and an Opinion of Counsel
that such Event of Default has been cured or waived.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto. In case an Event of Default of the type described in Section
6.01(f) or (g) above shall occur, the principal, premium and interest amount
with respect to all of the Notes shall be due and payable immediately without
any declaration or other act on the part of the Trustee or the Noteholders.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of, or premium, if any, and interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture and may
take any necessary action requested of it as Trustee to settle, compromise,
adjust or otherwise conclude any proceedings to which it is a party.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Noteholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
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Section 6.04. Waiver of Existing Defaults and Events of Default.
Subject to Sections 2.16, 6.02, 6.07 and 8.02 hereof, the Holders of a
majority in principal amount of the Notes then outstanding have the right to
waive existing Defaults under or in compliance with any provision of this
Indenture or the Notes except a continuing Default in the payment of the
principal of, or interest or premium, if any, on any Note as specified in
clauses (a) and (b) of Section 6.01 or in respect of a covenant or a provision
which cannot be modified or amended without the consent of all Holders as
provided for in Section 8.02. The Company shall deliver to the Trustee an
Officers' Certificate stating that the requisite percentage of Holders have
consented to such waiver and attaching copies of such consents. In case of any
such waiver, the Company, the Trustee and the Holders shall be restored to their
former positions and rights hereunder and under the Notes, respectively. This
paragraph of this Section 6.04 shall be in lieu of (S) 316(a)(1)(B) of the TIA
and such (S) 316(a)(1)(B) of the TIA is hereby expressly excluded from this
Indenture and the Notes, as permitted by the TIA.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred for every
purpose of this Indenture, but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereto.
Section 6.05. Control by Majority.
Subject to Section 2.16, the Holders of a majority in principal amount
of the outstanding Notes have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee by this Indenture. The Trustee,
however, may refuse to follow any direction that conflicts with law or this
Indenture or that the Trustee determines in its reasonable judgment may be
unduly prejudicial to the rights of another Noteholder not taking part in such
direction, and the Trustee shall have the right to decline to follow any such
direction if the Trustee, being advised by counsel, determines that the action
so directed may not lawfully be taken or if the Trustee in good faith shall, by
a Trust Officer, determine that the proceedings so directed may involve it in
personal liability; provided that the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction. In the
event the Trustee takes any action or follows any direction pursuant to this
Indenture, the Trustee shall be entitled to indemnification satisfactory to it
in its sole discretion against any loss or expense caused by taking such
action or following such direction. This Section 6.05 shall be in lieu of
(S) 316(a)(1)(A) of the TIA, and such (S) 316(a)(1)(A) of the TIA is hereby
expressly excluded from this Indenture and the Notes, as permitted by the TIA.
Section 6.06. Limitation on Suits.
Subject to Section 6.07 below, no Holder has any right to institute
any proceeding with respect to this Indenture or any remedy hereunder unless:
(1) the Holder gives the Trustee written notice of a continuing Event
of Default;
(2) the holders of at least 25% in aggregate principal amount of the
outstanding Notes make a written request to the Trustee to pursue
the remedy;
(3) such Holder or Holders offer to the Trustee indemnity reasonably
satisfactory to the Trustee against any loss, liability or expense
which may be incurred in compliance with such request;
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(4) the Trustee fails to institute such proceeding within 60 calendar
days after receipt of such notice and the offer of indemnity; and
(5) the Trustee has not received directions inconsistent with such
written request during such 60-day period by the holders of a
majority in aggregate principal amount of the outstanding Notes.
Notwithstanding the foregoing, such limitations do not apply to a suit
instituted on such Note on or after the respective due dates expressed in such
Note.
A Noteholder may not use this Indenture to prejudice the rights of
another Noteholder or to obtain a preference or priority over another
Noteholder.
Section 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal of, or premium, if any, or accrued
interest of any Note held by such Holder on or after the respective due dates
expressed in such Note, or to bring suit for the enforcement of any such payment
on or after such respective dates, is absolute and unconditional (subject to the
terms of this Indenture) and shall not be impaired or affected without the
consent of the Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal, premium or interest
specified in Section 6.01(a), (b) or (c) hereof occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company for the whole amount of unpaid principal, premium and
accrued interest remaining unpaid, together with, to the extent that payment of
such interest is lawful, interest on overdue principal and interest on overdue
installments of interest, in each case at the rate set forth in Section 4.01,
and such further amounts as shall be sufficient to cover the costs and expenses
of collection, including the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Noteholders allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same after
deduction of its charges and expenses to the extent that any such charges and
expenses are not paid out of the estate in any such proceedings and any
custodian in any such judicial proceeding is hereby authorized by each
Noteholder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the
Noteholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
or reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Noteholder in any such proceedings.
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Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07 hereof;
SECOND: if the Holders are forced to proceed against the Company or
any Guarantor directly without the Trustee, to Holders for their collection
costs;
THIRD: to Noteholders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest as to each, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Notes; and
FOURTH: to the Company or, to the extent the Trustee collects any
amounts from any Guarantor, to such Guarantor.
The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Noteholders pursuant to this
Section 6.10.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.07 hereof or a suit by Holders of more than 10% in
principal amount of the Notes then outstanding.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default actually known to a Trust Officer of the
Trustee has occurred and is continuing, the Trustee shall exercise such rights
and powers vested in it by this Indenture and use the same degree of care and
skill in their exercise as a prudent Person would exercise under the
circumstances in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default actually
known to a Trust Officer of the Trustee:
(1) The Trustee need perform only those duties that are specifically
set forth in this Indenture and the Trustee shall not be liable
except for the performance of such duties and obligations as are
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specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the
Trustee.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the
requirements of this Indenture but, in the case of any such
certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture (but need
not confirm or investigate the accuracy of mathematical
calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(A) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01.
(B) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer of the Trustee, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts.
(C) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.02, 6.04 and 6.05 hereof.
(D) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its rights or powers if it has reasonable grounds to
believe that repayment of such funds or adequate indemnity satisfactory to
it against such risk or liability is not reasonably assured to it.
(d) Whether or not expressly so provided, paragraphs (a), (b) and (c)
of this Section 7.01 shall govern every provision of this Indenture that in any
way relates to the Trustee.
(e) The Trustee is not under any obligation to exercise any of its
rights or powers under this Indenture at the request or direction of any of the
Holders unless such Holders shall have offered to the Trustee indemnity or
security satisfactory to it in its reasonable discretion against any loss,
liability, expense or fee.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held
in trust by the Trustee need not be segregated from other funds except to the
extent required by the law or as otherwise agreed to by the Trustee and the
Company.
Section 7.02. Rights of Trustee.
(1) The Trustee may conclusively rely on any document believed by it
in good faith to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.
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(2) Before the Trustee acts or refrains from acting with respect to
any matters contemplated by this Indenture or the Notes it may require an
Officers' Certificate or an Opinion of Counsel, or both, which shall conform to
the provisions of Section 13.05 hereof. The Trustee shall be fully protected
and shall not be liable for any action it takes or omits to take in good faith
in reliance on such certificate or opinion.
(3) The Trustee may act through agents, attorneys, custodians or
nominees and shall not be responsible for the misconduct or negligence of any
agent, attorney, custodian or nominee appointed with due care by it hereunder.
(4) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it reasonably believes to be authorized or within
its rights or powers under this Indenture.
(5) Before the Trustee acts or refrains from acting with respect to
any matters contemplated by this Indenture or the Notes, the Trustee may consult
with counsel of its selection, and the advice or opinion of such counsel,
accountant, appraiser or other expert adviser whether retained or employed by
the Company or the Trustee shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in reliance thereon.
(6) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture or
other paper or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and if the Trustee shall determine in good faith to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney at the sole cost of the
Company shall incur no liability or additional liability of any kind by reason
of such inquiry or investigation.
(7) In no event shall the Trustee be liable for the selection of
investments or for investment losses incurred thereon. The Trustee shall have
no liability in respect of losses incurred as a result of the liquidation of any
such investment prior to its stated maturity or the failure of the party
directing such investment to provide timely written investment direction. The
Trustee shall have no obligation to invest or reinvest any amounts held
hereunder in the absence of specific written investment direction.
(8) The rights, privileges, immunities and protections afforded to the
Trustee pursuant to this Indenture (including, without limitation, the right to
be indemnified) shall also be afforded to the Trustee in each of its capacities
hereunder and each Paying Agent, Registrar, Co-Registrar, Custodian, transfer
agent or tender agent and each agent or other Person employed to act hereunder.
(9) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Trust Officer of the Trustee has actual knowledge
thereof or unless written notice of any event which is in fact such a default is
received by the Trustee at the Corporate Trust Office of the Trustee, and such
notice references the Notes and this Indenture.
(10) The Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded.
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Section 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may make loans to, accept deposits from, perform
services for or otherwise deal with the Company, or any Affiliates thereof, with
the same rights it would have if it were not Trustee. Any Agent may do the same
with like rights. The Trustee, however, shall be subject to Sections 7.10 and
7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes or any recitals
therein, it shall not be accountable for the Company's use of the proceeds from
the sale of Notes or any money paid to the Company pursuant to the terms of this
Indenture and it shall not be responsible for any statement in the Notes other
than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or an Event of Default occurs and is continuing and if a
Trust Officer of the Trustee has actual knowledge of such Default or Event of
Default, the Trustee shall mail to each Noteholder notice of the uncured Default
or Event of Default within 30 days after such Default or Event of Default
occurs. Except in the case of a Default or an Event of Default in payment of
principal of, premium or interest on, any Note, including an accelerated payment
and the failure to make payment on the Change of Control Payment Date pursuant
to a Change of Control Offer or on the Excess Proceeds Payment Date pursuant to
an Excess Proceeds Offer and, except in the case of a failure to comply with
Article 5 hereof, the Trustee may withhold the notice if and so long as its
Board of Directors, the executive committee of its Board of Directors or a
committee of its directors and/or Trust Officers in good faith determines that
withholding the notice is in the best interest of the Noteholders. This Section
7.05 shall be in lieu of the proviso to Section 315(b) of the TIA, and such
proviso of Section 315(b) of the TIA is hereby expressly excluded from this
Indenture and the Notes, as permitted by the TIA.
Section 7.06. Reports by Trustee to Holders.
If required by TIA Section 313(a), within 60 days after May 15 of any
year, commencing on May 15, 2000, the Trustee shall transmit by mail to each
Noteholder a brief report dated as of such May 15 that complies with TIA Section
313(a). The Trustee also shall comply with the reporting requirements of TIA
Section 313(b)(2).
A copy of each such report at the time of such mailing to Noteholders
shall be mailed to the Company and, if the Notes are listed on a stock exchange,
filed with the Commission and each stock exchange on which the Notes are listed
as provided by TIA Section 313(d). The Company shall promptly notify the
Trustee when the Notes are listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time such
compensation as may from time to time be agreed in writing between the Company
and the Trustee for its services hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust). Except as otherwise provided herein, the Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it in connection with its duties under this
Indenture, including the reasonable compensation, disbursements and expenses of
the Trustee's agents, counsel, custodians
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and nominees and except for any such disbursement or expense as may be
attributable to the Trustee's negligence, bad faith or willful misconduct.
The Company shall indemnify each of the Trustee and its officers,
directors, employees and agents and any predecessor Trustee and its officers,
directors, employees and agents for, and hold it or them harmless against, any
and all loss, damage, claim, liability or reasonable expense, including taxes
(other than franchise taxes and taxes based on the income of the Trustee)
incurred by it or them in connection with the acceptance or performance of its
duties under this Indenture and any other documents and transactions in
connection therewith including the reasonable costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its or their powers or duties hereunder (including,
without limitation, settlement costs, provided any settlement with respect to
which indemnification is sought shall have been consented to by the Company).
The Trustee shall notify the Company in writing promptly of any claim asserted
against the Trustee for which it may seek indemnity. However, the failure by
the Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder except to the extent the Company is prejudiced thereby.
This section shall survive the termination of this Indenture and the earlier
resignation or removal of the Trustee.
Notwithstanding the foregoing, the Company need not reimburse the
Trustee for any expense or indemnify it against any loss, damage, claim or
liability incurred by the Trustee through its negligence, bad faith or willful
misconduct. To secure the payment obligations of the Company in this Section
7.07, the Trustee shall have a lien prior to the Notes on all money or property
held or collected by the Trustee except such money or property held in trust to
pay principal of and interest on particular Notes.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(f) or (g) hereof occurs, the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any Federal or state bankruptcy, insolvency or similar law.
For purposes of this Section 7.07, the term "Trustee" shall include
any trustee appointed pursuant to Section 7.08.
Section 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company in writing. The
Holders of a majority in principal amount of the outstanding Notes may remove
the Trustee by notifying the removed Trustee and the Company in writing and may
appoint a successor Trustee with the Company's written consent. The Company may
remove the Trustee at its election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy
Law;
(3) a receiver or other public officer takes charge or control of the
Trustee or its property or affairs; or
(4) the Trustee otherwise becomes incapable of acting.
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If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.
No resignation or removal of the Trustee shall become effective until
the acceptance of appointment by the successor Trustee. If a successor Trustee
does not take office within 30 days after the retiring Trustee resigns or is
removed, the retiring Trustee, the Company or the Holders of a majority in
principal amount of the outstanding Notes may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee if the Trustee fails
after written request thereof by such Noteholder to comply with Section 7.10.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately following
such delivery, the resignation or removal of the retiring Trustee shall become
effective and the retiring Trustee shall, subject to its rights under Section
7.07 hereof, transfer all property held by it as Trustee to the successor
Trustee, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee, after any and all amounts then due and
owing the Trustee hereunder have been paid in full, shall have all the rights,
powers and duties of the Trustee under this Indenture. A successor Trustee
shall mail notice of its succession to each Noteholder. Notwithstanding
replacement of the Trustee pursuant to this Section 7.08, the Company's
obligations under Section 7.07 hereof shall continue for the benefit of the
retiring Trustee.
Section 7.09. Successor Trustee by Consolidation, Merger or Conversion.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, subject to Section 7.10 hereof, the successor corporation without
any further act shall be the successor Trustee. In case at the time such
successor or successors by merger, conversion or consolidation to the Trustee
shall succeed to the trusts created by this Indenture any of the Notes shall
have been authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor trustee, and deliver
such Notes so authenticated; and in case at that time any of the Notes shall not
have been authenticated, any such successor to the Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Notes or in this Indenture provided that
the certificate of the Trustee shall have.
Section 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1) and (2). The Trustee shall have a
combined capital and surplus of at least U.S. $100,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA Section 310(b), including the provision in Section 310(b)(1). The
provisions of TIA Section 310(a)(5) shall apply to any Person directly or
indirectly controlling, controlled by or under common control with the Company
as obligor of the Notes. If at any time the Trustee ceases to be eligible with
the provisions of this section 7.10, the Trustee shall resign immediately in the
manner and with the effect herein before specified in this Article 7.
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Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.
The Company and the Guarantors, when authorized by a Board Resolution,
and the Trustee may amend or supplement this Indenture, the Notes or the
Guarantees without notice to or consent of any Noteholder:
(1) to cure any ambiguity, defect or inconsistency; provided that such
amendment or supplement does not, in the opinion of the Trustee,
adversely affect the rights of any Holder in any material respect;
(2) to provide for uncertificated Notes in addition to or in place of
Certificated Notes;
(3) to comply with any requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the
TIA;
(4) to make any change that would provide any additional benefit or
rights to the Holders;
(5) to make any other change that does not in the opinion of the
Trustee, materially and adversely affect the rights of any Holder
under this Indenture;
(6) to add to the covenants of the Company or a Guarantor for the
benefit of the Holders, or to surrender any right or power herein
conferred upon the Company or any Guarantor;
(7) to secure the Notes pursuant to the requirements of Section 4.15 or
otherwise;
(8) to reflect the release of a Guarantor from its obligations with
respect to its Guarantee pursuant to Section 10.06 or to add a
Guarantor pursuant to Section 4.20; or
(9) to effect the assumption by a Successor Person of all obligations
of the Company under the Notes and this Indenture in connection
with any transaction complying with Article 5 of this Indenture.
Section 8.02. With Consent of Holders.
Subject to Section 6.07, the Company, and the Guarantors, when each is
authorized by a Board Resolution of their respective Boards of Directors, and
the Trustee may amend or supplement this Indenture or
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the Notes or the Guarantees with the written consent of the Holders of at least
a majority in principal amount of the outstanding Notes. Subject to Section
6.07, the Holders of a majority in principal amount of the outstanding Notes may
waive compliance by the Company, or any Guarantor with any provision of this
Indenture, the Notes, or the Guarantees. However, without the consent of each
Noteholder affected, an amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may not:
(1) reduce the amount of Notes whose Holders must consent to an
amendment, supplement or waiver under this Indenture;
(2) reduce the rate of or change the time for payment of interest
(including defaulted Interest) on any Note;
(3) reduce the principal of or premium on or change the stated maturity
of any Notes, or change the date on which any Notes may be subject
to redemption or repurchase, or reduce the redemption or repurchase
price therefor;
(4) make any Note payable in money other than that stated in the Note
or change the place of payment;
(5) waive a Default in the payment of the principal of, or interest or
premium on, or any redemption payment with respect to, any Note
(except a rescission of acceleration of the Notes by the Holders as
provided in Section 6.02 and a waiver of the payment default that
resulted from such acceleration);
(6) make any changes in Sections 6.04 or 6.07 hereof or this sentence
of Section 8.02;
(7) amend, change or modify in any material respect, any 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 an Excess
Proceeds Offer with respect to any Asset Sale that has been
consummated or modify any of the provisions or definitions with
respect thereto;
(8) modify or change any provision of this Indenture or the related
definitions affecting the subordination or ranking of the Notes or
any Guarantee in a manner which adversely affects the holders of
Notes; or
(9) release any Guarantor from any of its obligations under its
Guarantee or this Indenture otherwise than in accordance with the
terms of this Indenture.
After an amendment, supplement or waiver under this Section 8.02
becomes effective, the Company shall mail to the Holders a notice briefly
describing the amendment, supplement or waiver. Any failure of the Company to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such supplemental indenture.
Upon the request of the Company, accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon the
receipt by the Trustee of evidence reasonably satisfactory to the Trustee of the
consent of the Noteholders as aforesaid and upon receipt by the Trustee of the
documents described in Section 8.06 hereof, the Trustee shall join with the
Company and the Guarantors in the execution of such supplemental indenture
unless such supplemental indenture affects the Trustee's own rights, duties or
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immunities under this Indenture, in which case the Trustee may in its own
discretion, but shall not be obligated to, enter into such supplemental
indenture.
It shall not be necessary for the consent of the Holders under this
Section 8.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
Section 8.03. Compliance with TIA.
Every amendment to or supplement of this Indenture, the Notes or the
Guarantees shall comply with the TIA as then in effect.
Section 8.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Note or portion of a Note that evidences the same debt as the
consenting Holder's Note, even if notation of the consent is not made on any
Note. Subject to the following paragraph, any such Holder or subsequent Holder
may revoke the consent as to such Holder's Note or portion of such Note by
notice to the Trustee or the Company received before the date on which the
Trustee receives an Officers' Certificate certifying that the Holders of the
requisite principal amount of Notes have consented (and not theretofore revoked
such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the last
sentence of the immediately preceding paragraph, those Persons who were Holders
at such record date (or their duly designated proxies), and only those Persons,
shall be entitled to revoke any consent previously given, whether or not such
Persons continue to be Holders after such record date. No such consent shall be
valid or effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Noteholder, unless it makes a change described in any of clauses (1)
through (9) of Section 8.02, in which case, the amendment, supplement or waiver
shall bind only each Holder of a Note who has consented to it and every
subsequent Holder of a Note or portion of a Note that evidences the same debt as
the consenting Holder's Note; provided that any such waiver shall not impair or
affect the right of any Holder to receive payment of principal of and interest
on a Note, on or after the respective due dates expressed in such Note, or to
bring suit for the enforcement of any such payment on or after such respective
dates without the consent of such Holder.
Section 8.05. Notation on or Exchange of Notes.
If an amendment, supplement, or waiver changes the terms of a Note,
the Trustee may request the Holder to deliver it to the Trustee. In such case,
the Trustee shall place an appropriate notation on the Note about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determine, in exchange for the Note the Company shall issue and the Trustee
shall authenticate a new Note that reflects the changed terms. Failure to make
the appropriate notation or issue a new Note shall not affect the validity and
effect of such amendment, supplement or waiver.
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Section 8.06. Trustee To Sign Amendments, etc.
The Trustee shall be entitled to receive, and shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution of any
amendment, supplement or waiver authorized pursuant to this Article 8 is
authorized or permitted by this Indenture and that such amendment, supplement or
waiver constitutes the legal, valid and binding obligation of the Company and
any Guarantors, enforceable in accordance with its terms (subject to customary
exceptions). The Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise.
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Satisfaction and Discharge of Indenture.
This Indenture shall be discharged and shall cease to be of further
effect (except those obligations referred to in the penultimate paragraph of
this Section 9.01) and the Trustee, on written demand of and at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when either:
(a) all Notes theretofore authenticated and delivered (other than (i)
Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.07 hereof and (ii) Notes for
whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust) have been delivered to the Trustee for
cancellation; or
(b) (i) either (A) pursuant to Article 3, the Company shall have given
notice to the Trustee and mailed a notice of redemption to each Holder of
the redemption of all of the Notes under arrangements satisfactory to the
Trustee for the giving of such notice or (B) all Notes not theretofore
delivered to the Trustee for cancellation have become due and payable; (ii)
the Company has irrevocably deposited or caused to be deposited with the
Trustee in trust for the purpose an amount Euros sufficient to pay and
discharge the entire Indebtedness on such Notes not theretofore delivered
to the Trustee for cancellation, for the principal of, premium, if any, and
interest to the date of such deposit; (iii) no Default or Event of Default
with respect to this Indenture or the Notes shall have occurred and be
continuing on the date of such deposit or shall occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other material instrument to which the
Company is a party or by which it is bound (other than a Default or Event
of Default resulting from the incurrence of Indebtedness, all or a portion
of which will be used to defease the Notes concurrently with such
incurrence); (iv) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; (v) the Company has delivered to the
Trustee (A) irrevocable instructions to apply the deposited money toward
payment of the Notes at the maturity thereof, and (B) an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with and that such satisfaction and
discharge does not result in a default under the Senior Credit Facility (if
then in effect) or any other material agreement or instrument then known to
such counsel which binds or affects the Company; and (vi)
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that from and after the time of deposit, the money deposited shall not be
subject to the rights of holders of Senior Debt pursuant to the provisions
of Article 12 or to the rights of holders of Senior Debt pursuant to the
provisions of Article 11.
Notwithstanding the foregoing paragraph, the Company's obligations in
Article 2 and Sections 4.01 and 4.07 shall survive until the Notes are no longer
outstanding pursuant to the last paragraph of Section 2.08.
After such delivery or irrevocable deposit, the Trustee upon request
shall acknowledge in writing the discharge of the Company's and each Guarantor's
obligations under the Notes, the Guarantees and this Indenture except for those
surviving obligations specified above.
Section 9.02. Legal Defeasance.
(a) The Company may, at its option by Board Resolution of the Board of
Directors of the Company, at any time, elect to have this section be applied to
all outstanding Notes upon compliance with the conditions set forth in Section
9.04.
(b) Upon the Company's exercise under paragraph (a) hereof of the
option applicable to this paragraph (b), the Company and each Guarantor shall,
subject to the satisfaction of the conditions set forth in Section 9.04, be
deemed to have been discharged from their respective obligations with respect to
all outstanding Notes and the Guarantees on the date the conditions set forth
below are satisfied (hereinafter, "Legal Defeasance"). For this purpose, Legal
Defeasance means that the Company and each Guarantor shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding Notes
and the Guarantees, which shall thereafter be deemed to be "outstanding" only
for the purposes of Section 9.05 hereof and the other Sections of this Indenture
referred to in (i) and (ii) below, and to have satisfied all their other
respective obligations under such Notes and this Indenture (and the Trustee, on
demand of and at the expense of the Company, shall execute proper instruments
acknowledging the same), and Holders of the Notes and any amounts deposited
under Section 9.04 hereof shall cease to be subject to any obligations to, or
the rights of, any holder of Senior Debt under Article 12 or otherwise or any
holder of Senior Debt under Article 11 or otherwise, except for the following
provisions, which shall survive until otherwise terminated or discharged
hereunder: (i) the rights of Holders of outstanding Notes to receive solely
from the trust fund described in Section 9.05 hereof, and as more fully set
forth in such Section, payments in respect of the principal of, premium, if any,
and interest on such Notes when such payments are due, (ii) the Company's
obligations with respect to such Notes under Article 2 and Section 4.07 hereof,
(iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder
and the Company's obligations in connection therewith and (iv) this Article 9.
Subject to compliance with this Article 9, the Company may exercise its option
under this Section 9.02 notwithstanding the prior exercise of its option under
Section 9.03 below with respect to the Notes.
Section 9.03. Covenant Defeasance.
(a) The Company may, at its option by Board Resolution of the Board of
Directors of the Company, at any time, elect to have this Section be applied to
all outstanding Notes upon compliance with the conditions set forth in Section
9.04.
(b) Upon the Company's exercise under paragraph (a) hereof of the
option applicable to this paragraph (b), the Company and each Guarantor shall,
subject to the satisfaction of the conditions set forth in Section 9.04 hereof,
be released from their respective obligations under the covenants contained in
Sections
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4.05, 4.08, 4.09 and 4.10 through 4.21, inclusive, and Article 5 hereof with
respect to the outstanding Notes and the Guarantees on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Notes and the Guarantees shall thereafter be deemed not "outstanding"
for the purposes of any direction, waiver, consent or declaration or act of
Holders (and the consequences of any thereof) in connection with such covenants,
but shall continue to be deemed "outstanding" for all other purposes hereunder
and Holders of the Notes and any amounts deposited under Section 9.04 hereof
shall cease to be subject to any obligations to the rights of, any holder of
Senior Debt under Article 12 or otherwise or any holder of Senior Debt under
Article 11 or otherwise. For this purpose, such Covenant Defeasance means that,
with respect to the outstanding Notes and the Guarantees, the Company and each
Guarantor may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such covenant, whether directly
or indirectly, by reason of any reference elsewhere herein to any such covenant
or by reason of any reference in any such covenant to any other provision herein
or in any other document and such omission to comply shall not constitute a
Default or an Event or Default under Section 6.01(c) hereof, but, except as
specified above, the remainder of this Indenture, such Notes and the Guarantees
shall be unaffected thereby. In addition, upon the Company's exercise under
paragraph (a) hereof of the option applicable to this paragraph (b), subject to
the satisfaction of the conditions set forth in Section 9.04 hereof, Sections
6.01(c), 6.01(d) and 6.01(e) shall not constitute Events of Default.
Section 9.04. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of either
Section 9.02 or 9.03 hereof to the outstanding Notes and the Guarantees:
In order to exercise either Legal Defeasance or Covenant Defeasance:
(a) the Company must irrevocably deposit with the Trustee (or other
qualifying Trustee), in trust, for the benefit of the Holders, Euros in
such amounts as will be sufficient, in the opinion of a nationally
recognized firm of independent public accountants, to pay the principal of,
premium, if any, and interest on the Notes on the scheduled due dates for
payment thereof or on a selected Redemption Date, as the case may be,
provided that the Trustee shall have received an irrevocable written order
from the Company instructing the Trustee to apply such money to said
payments with respect to the Notes;
(b) in the case of an election under Section 9.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel reasonably
acceptable to the Trustee confirming that (i) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling
or (ii) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that, and
based thereon such Opinion of Counsel shall confirm that, the Holders will
not recognize income, gain or loss for federal income tax purposes as a
result of such Legal Defeasance and will be subject to federal income tax
on the same amounts, in the same manner and at the same times as would have
been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 9.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel confirming that
the Holders will not recognize income, gain or loss for federal income tax
purposes as a result of such Covenant Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not
occurred;
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(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or insofar as Sections 6.01(f) and
6.01(g) hereof are concerned, at any time in the period ending on the 91st
day after the date of such deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of or constitute a default under this Indenture or any
other material agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries
is bound;
(f) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders over any other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or others;
(g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with;
(h) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that (i) the trust funds will not be subject to any
rights of any holders of Senior Debt of the Company or Senior Debt of any
Guarantor, and (ii) assuming no intervening event of the type described in
Sections 6.01(f) and 6.01(g) between the date of deposit and the 91st day
following the deposit (it being understood that this condition should not
be deemed to be satisfied until the expiration of such period), the trust
funds will not be subject to the effect of any applicable Bankruptcy Law;
(i) such Legal Defeasance or Covenant Defeasance shall not cause the
Trustee to have a conflicting interest for purposes of the TIA with respect
to any securities of the Company; and
(j) the Company shall have delivered to the Trustee an Opinion of
Counsel stating that, as a result of such Legal Defeasance or Covenant
Defeasance, neither the trust nor the Trustee will be required to register
as an investment company under the Investment Company Act of 1940, as
amended.
Section 9.05. Application of Trust Money.
All money deposited with the Trustee pursuant to Section 9.01 or 9.04
hereof in respect of the outstanding Notes shall be held in trust and applied by
the Trustee, in accordance with the provisions of such Notes and this Indenture,
to the payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Notes, of all sums due and to become due
thereon in respect of principal, premium, if any, and accrued interest, but such
money need not be segregated from other funds except to the extent required by
law.
Anything in this Article 9 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon a written
request of the Company in the form of an Officers' Certificate any money held by
it as provided in Section 9.01 or 9.04 hereof which, in the opinion of a
nationally-recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of the
amount thereof which would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
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Section 9.06. Repayment to the Company.
Subject to Sections 9.01, 9.,02, 9.03, 9.04, 9.05 and 9.07, the
Trustee and the Paying Agent shall promptly pay to the Company upon request any
excess Euros held by them at any time and thereupon shall be relieved from all
liability with respect to such money. The Trustee and the Paying Agent shall
pay to the Company upon request any money held by them for the payment of
principal, premium, if any, or interest that remains unclaimed for two years;
provided that the Trustee or such Paying Agent, before being required to make
any payment, may at the expense of the Company cause to be published once in a
newspaper of general circulation in the City of New York or mail to each Holder
entitled to such money notice that such money remains unclaimed, and that after
a date specified therein which shall be at least 30 days from the date of such
publication or mailing, any unclaimed balance of such money then remaining will
be repaid to the Company. After payment to the Company, Noteholders entitled to
such money must look to the Company for payment as general creditors unless an
applicable law designates another Person.
Section 9.07. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money in
accordance with Section 9.01, 9.02 or 9.03 hereof by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and each Guarantor's obligations under this Indenture, the Notes and
the Guarantees shall be revived and reinstated as though no deposit had occurred
pursuant to this Article 9 until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 9.01 hereof;
provided, however, that if the Company or the Guarantors have made any payment
of principal of, premium, if any, or accrued interest on any Notes because of
the reinstatement of their obligations, the Company and each such Guarantor
shall be subrogated to the rights of the Holders of such Notes to receive such
payment from the money held by the Trustee or Paying Agent.
ARTICLE 10
GUARANTEE
Section 10.01. Unconditional Guarantee.
Each Guarantor hereby unconditionally, jointly and severally,
guarantees to each Holder of a Note authenticated by the Trustee and to the
Trustee and its successors and assigns that the principal of, premium thereon
(if any) and interest on the Notes and all other amounts payable by the Company
hereunder 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 and interest on any overdue interest on the Notes and all
other obligations of the Company to the Holders or the Trustee hereunder or
under the Notes will be promptly paid in full or performed, all in accordance
with the terms hereof and thereof; subject, however, to the limitations set
forth in Section 10.03. 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, any 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 insol-
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vency or bankruptcy of the Company, any right to require a proceeding first
against the Company, protest, notice and all demands whatsoever and covenants
that the Guarantee will not be discharged except by complete performance of the
obligations contained in the Notes and this Indenture. Notwithstanding the
foregoing, each Guarantor shall be released from all obligations under its
Guarantee under this Article 10 concurrently with the defeasance of the Notes
under Section 9.02. 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, each Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Guarantor further agrees that, as
between a 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 6 for the purpose of each 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 6, such
obligations (whether or not due and payable) shall become due and payable by
each Guarantor for the purpose of each Guarantee.
Each Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees) incurred by the Trustee or any Holder in
enforcing any rights under this Article 10.
Section 10.02. Severability.
In case any provision of this Article 10 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 10.03. Limitation on Guarantor's Liability; Contribution.
Each Guarantor, and by its acceptance hereof, each Holder and the
Trustee, hereby confirm that it is the intention of all such parties that the
Guarantee does not constitute a fraudulent transfer or conveyance for purposes
of Title 11 of the United States Code, as amended, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar U.S. Federal
or state or other applicable law. To effectuate the foregoing intention, each
Holder and each Guarantor hereby irrevocably agree that the obligations of a
Guarantor under its Guarantee shall be limited to the maximum amount as will,
after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of such Guarantor in respect of the obligations of such Guarantor
pursuant to the second paragraph of Section 10.03, result in the obligations of
such Guarantor not constituting such a fraudulent transfer or conveyance.
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under a Guarantee
such Funding Guarantor shall be entitled to a contribution from all other
Guarantors in a pro rata amount, based on the Adjusted Net Assets of each
Guarantor (including the Funding Guarantor), determined in accordance with GAAP,
subject to the first paragraph of this Section 10.03, for all payments, damages
and expenses incurred by such Funding Guarantor in discharging the Company's
obligations with respect to the Notes or any other Guarantor's obligations under
a Guarantee.
Section 10.04. Successors and Assigns.
This Article 10 shall be binding upon each Guarantor and to the extent
otherwise required by this Indenture, its successors and assigns and to the
extent otherwise required by this Indenture, shall inure to the
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benefit of the successors and assigns of the Trustee and the Holders and, in the
event of any transfer or assignment of rights by any Holder or the Trustee, the
rights and privileges conferred upon that party in this Indenture and in the
Notes shall automatically extend to and be vested in such transferee or
assignee, all subject to the terms and conditions of this Indenture.
Section 10.05. No Waiver.
Neither a failure nor a delay on the part of either the Trustee or the
Holders in exercising any right, power or privilege under this Article 10 shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise of any right, power or privilege. The
rights, remedies and benefits of the Trustee and the Holders herein expressly
specified are cumulative and not exclusive of any other rights, remedies or
benefits which either may have under this Article 10 at law, in equity, by
statute or otherwise.
Section 10.06. Release of Guarantor.
A Guarantor shall be released from all of its obligations under its
Guarantee if (x) the Guarantor has sold all or substantially all of its assets
or the Company and its Subsidiaries have sold all of the Capital Stock of the
Guarantor owned by them, in each case in a transaction in compliance with
Sections 4.11 and in such case, the Company have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to such transactions have been
complied with or (y) if the Guarantor is an Immaterial Subsidiary.
Section 10.07. Execution of Supplemental Indenture for Future Guarantors.
Each Subsidiary which is required to become a Guarantor pursuant to
Section 4.20 shall, and the Company shall cause each such Subsidiary to,
promptly execute and deliver to the Trustee a supplemental indenture
substantially in the form of Exhibit H hereto pursuant to which such Subsidiary
shall become a Guarantor under this Article 10 and shall guarantee the
obligations of the Company under the Notes and this Indenture. Concurrently
with the execution and delivery of such supplemental indenture, the Company
shall deliver to the Trustee an Opinion of Counsel to the effect that such
supplemental indenture has been duly authorized, executed and delivered by such
Subsidiary and that, subject to the application of bankruptcy, insolvency,
moratorium, fraudulent conveyance or transfer and other similar laws relating to
creditors' rights generally and to the principles of equity, whether considered
in a proceeding at law or in equity, the Guarantee of such Guarantor is a legal,
valid and binding obligation of such Guarantor, enforceable against such
Guarantor in accordance with its terms.
Section 10.08. Execution and Delivery of Guarantee.
To evidence the Guarantee set forth in this Article 10, each Guarantor
hereby agrees that a notation of such Guarantee shall be placed on each Note
authenticated and made available for delivery by the Trustee and that this
Guarantee shall be executed on behalf of each Guarantor by the manual or
facsimile signature of an Officer of each Guarantor or, in the case of non-U.S.
Guarantors, an authorized signatory of each Guarantor. Each Guarantor hereby
agrees that the Guarantee set forth in Section 10.01 shall remain in full force
and effect notwithstanding any failure to endorse on each Note a notation of
such Guarantee. If an Officer of a Guarantor whose signature is on the
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which the Guarantee is endorsed, the Guarantee shall be valid
nevertheless. The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
this Indenture on behalf of each Guarantor.
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Section 10.09. Subordination of Subrogation and Other Rights.
Each Guarantor hereby agrees that any claim against the Company that
arises from the payment, performance or enforcement of such Guarantor's
obligations under the Guarantee or this Indenture, including, without
limitation, any right of subrogation, shall be subject and subordinate to, and
no payment with respect to any such claim of such Guarantor shall be made
before, the payment in full in cash of all outstanding Notes in accordance with
the provisions provided therefor in this Indenture.
ARTICLE 11
SUBORDINATION OF GUARANTEE
Section 11.01. Guarantee Obligations Subordinated to Senior Debt.
Each Guarantor covenants and agrees, and the Trustee and each Holder,
by its acceptance of the Notes, likewise covenants and agrees, that to the
extent and in the manner hereinafter set forth in this Article 11, the
Indebtedness represented by the Guarantee and the payment of all Obligations on
the Notes pursuant to the Guarantee by such Guarantor are hereby expressly made
subordinate and subject in right of payment as provided in this Article 11 to
the prior indefeasible payment in full in cash of all Senior Debt of such
Guarantor whether outstanding on the Issue Date or thereafter incurred.
This Section 11.01 and the following Sections 11.02 through 11.06
shall constitute a continuing offer to all Persons who, in reliance upon such
provisions, become holders of or continue to hold Senior Debt of any Guarantor;
such provisions are made for the benefit of the holders of Senior Debt of each
Guarantor.
Section 11.02. Payment Over of Proceeds upon Dissolution, etc.
In the event of (a) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to any Guarantor or to its
creditors, as such, or to its assets, whether voluntary or involuntary, or (b)
any liquidation, dissolution or other winding-up of any Guarantor, whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy
or (c) any general assignment for the benefit of creditors or any other
marshaling of assets or liabilities of any Guarantor, then and in any such
event:
(1) the holders of all Senior Debt of such Guarantor shall be entitled
to receive indefeasible payment in full in cash of all amounts due
on or in respect of all such Senior Debt before the Holders are
entitled to receive, pursuant to the Guarantee of such Guarantor,
any payment or distribution of any kind or character (other than
payment or distribution from the trust described in Section 9.01 or
Section 9.04) by such Guarantor on account of any of the
Obligations of such Guarantor under its Guarantee; and
(2) any payment or distribution of assets of such Guarantor of any kind
or character, whether in cash, property or securities, by set-off
or otherwise, to which the Holders or the Trustee would be entitled
but for the subordination provisions of this Article 11 shall be
paid by the liquidating trustee or agent or other Person making
such payment or distribution, whether a trustee in bankruptcy, a
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receiver or liquidating trustee or otherwise, directly to the
holders of Senior Debt of such Guarantor or their representative or
representatives or to the trustee or trustees under any indenture
under which any instruments evidencing any of such Senior Debt may
have been issued, ratably according to the aggregate amounts
remaining unpaid on account of such Senior Debt held or represented
by each, to the extent necessary to make payment in full in cash of
all such Senior Debt remaining unpaid, after giving effect to any
concurrent payment or distribution to the holders of such Senior
Debt; and
(3) in the event that, notwithstanding the foregoing provisions of this
Section 11.02, the Trustee or any Holder shall have received any
payment or distribution of assets of such Guarantor of any kind or
character, whether in cash, Property or securities, including,
without limitation, by way of set-off or otherwise, in respect of
any of the Obligations of any Guarantor pursuant to its Guarantee
before all Senior Debt of such Guarantor is indefeasibly paid in
full, then and in such event such payment or distribution shall be
paid over or delivered forthwith to the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee, agent or other
Person making payment or distribution of assets of such Guarantor
for application to the payment of all such Senior Debt remaining
unpaid, to the extent necessary to pay all of such Senior Debt in
full in cash or, as acceptable to the holders of such Senior Debt,
any other manner, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Debt.
The consolidation of a Guarantor with, or the merger of a Guarantor
with or into, another Person or the liquidation or dissolution of a Guarantor
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article 5 hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshaling of assets and liabilities of such Guarantor for the purposes of this
Article 11 if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, comply
with the conditions set forth in such Article 5 hereof.
Section 11.03. Suspension of Guaranteed Obligations When Senior Debt in
Default.
(a) Unless Section 11.02 hereof shall be applicable, upon the
occurrence of a Payment Default on Designated Senior Debt of any Guarantor no
payment or distribution (other than a payment or distribution from the trust
described in Section 9.01 or Section 9.04) of any assets or securities of a
Guarantor of any kind or character (including, without limitation, cash,
property and any payment or distribution which may be payable or deliverable by
reason of the payment of any other Indebtedness of such Guarantor being
subordinated to its Obligations under its Guarantee) may be made by or on behalf
of such Guarantor, including, without limitation, by way of set-off or
otherwise, for or on account of its Obligations under its Guarantee, or for or
on account of the purchase, redemption or other acquisition of the Notes and
neither the Trustee nor any Holder shall take or receive from any Guarantor,
directly or indirectly in any manner, payment in respect of all or any portion
of its Obligations under its Guarantee commencing on the date of receipt by the
Trustee of a written notice from the representative of the holders of such
Senior Debt (the "Guarantor Representative") of the occurrence of a Payment
Default, and in any such event, such prohibition shall continue until such
Payment Default is cured, waived in writing or otherwise ceases to exist. At
such time as the prohibition set forth in the preceding sentence shall no longer
be in effect, subject to the provisions of the following paragraph (b), such
Guarantor shall resume making any and all required payments in respect of the
Obligations, including any missed payments.
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(b) Unless Section 11.02 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on Designated Senior Debt of any
Guarantor, no payment or distribution (other than a payment or distribution made
from the trust described in Section 9.01 or Section 9.04) of any assets of such
Guarantor of any kind or character (including, without limitation, cash,
Property and any payment or distribution which may be payable or deliverable by
reason of the payment of any other Indebtedness of such Guarantor being
subordinated to its Obligations under its Guarantee) shall be made by such
Guarantor, including, without limitation, by way of set-off or otherwise, on
account of any of its Obligations and its Guarantee, or on account of the
purchase, redemption, defeasance or other acquisition of the Notes and neither
the Trustee nor any Holder or owner of any Notes shall take or receive from the
Company or any Restricted Subsidiary of the Company, directly or indirectly in
any manner, payment in respect of all or any portion of the Notes for a period
(the "Guarantee Payment Blockage Period") commencing on the date of receipt by
the Trustee of written notice from the Guarantor Representative of such Non-
Payment Event of Default, unless and until (subject to any blockage of payments
that may then be in effect under the preceding paragraph (a)) the earliest to
occur of the following events: (w) more than 179 days shall have elapsed since
the date of receipt of such written notice by the Trustee, (x) such Non-Payment
Event of Default shall have been cured or waived in writing or shall have ceased
to exist, (y) such Designated Senior Debt shall have been discharged or
indefeasibly paid in full in cash or (z) such Guarantee Payment Blockage Period
shall have been terminated by written notice to such Guarantor or the Trustee
from the Guarantor Representative initiating such Guarantee Payment Blockage
Period, or the holders of at least a majority in principal amount of such issue
of Designated Senior Debt, after which, in the case of clause (w), (x), (y) or
(z), such Guarantor shall resume making any and all required payments in respect
of its Obligations under its Guarantee, including any missed payments.
Notwithstanding any other provisions of this Indenture, no Non-Payment Event of
Default with respect to Designated Senior Debt which existed or was continuing
on the date of the commencement of any Guarantee Payment Blockage Period
initiated by the Guarantor Representative shall be, or be made, the basis for
the commencement of a second Guarantee Payment Blockage Period initiated by the
Guarantor Representative unless such Non-Payment Event of Default shall have
been cured or waived for a period of not less than 90 consecutive days. In no
event shall a Guarantee Payment Blockage Period extend beyond 179 days from the
date of the receipt by the Trustee of the notice referred to in this Section
11.03(b) or, in the event of a Non-Payment Event of Default which formed the
basis for a Payment Blockage Period under Section 12.03(b) hereof, 179 days from
the date of the receipt by the Trustee of the notice referred to in Section
12.03(b) (the "Initial Guarantee Blockage Period"). Any number of additional
Guarantee Payment Blockage Periods may be commenced during the Initial Guarantee
Blockage Period; provided, however, that no such additional Guarantee Payment
Blockage Period shall extend beyond the Initial Guarantee Blockage Period.
After the expiration of the Initial Guarantee Blockage Period, no Guarantee
Payment Blockage Period may be commenced under this Section 12.03(b) and no
Payment Blockage Period may be commenced under Section 11.03(b) hereof until at
least 180 consecutive days have elapsed from the last day of the Initial
Guarantee Blockage Period.
In the event that, notwithstanding the foregoing, the Trustee or any
holder of Notes receives any payment or distribution of assets of the Company of
any kind, whether in cash, property, or securities, including, without
limitation, by way of set-off or otherwise, in respect of the Notes before all
Senior Debt of a Guarantor is paid and satisfied in full in cash, then such
payment or distribution will be held by the recipient in trust for the benefit
of holders of Senior Debt and will be immediately paid over or delivered to the
holders of Senior Debt or their representative or representatives to the extent
necessary to make payment in full of all Senior Debt remaining unpaid after
giving effect to any concurrent payment or distribution, or provision therefor,
to or for the holders of Senior Debt.
(c) In the event that, notwithstanding the foregoing, the Trustee or
any Holder shall have received any payment from a Guarantor prohibited by the
foregoing provisions of this Section 11.03, then and in
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such event such payment shall be paid over and delivered forthwith to the
Guarantor Representative initiating the Guarantee Payment Blockage Period, in
trust for distribution to the holders of Senior Debt or, if no amounts are then
due in respect of Senior Debt, promptly returned to the Guarantor, or as a court
of competent jurisdiction shall direct.
Section 11.04. Trustee's Relation to Senior Debt.
The Trustee and any agent of any Guarantor or the Trustee shall be
entitled to all the rights set forth in this Article 11 with respect to any
Senior Debt which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Senior Debt and nothing in
this Indenture shall deprive the Trustee or any such agent of any of its rights
as such holder.
With respect to the holders of 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 11, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt and the Trustee shall not be liable
to any holder of Senior Debt if it shall mistakenly pay over or deliver to
Holders, such Guarantor or any other person moneys or assets to which any holder
of Senior Debt shall be entitled by virtue of this Article 11 or otherwise.
Nothing in this Section 11.04 shall affect the obligation of any other such
person receiving such payment or distribution from the Trustee or any other
Agent to hold such payment for the benefit of, and to pay such payment over to,
the holders of Senior Debt.
Section 11.05. Subrogation.
Upon the payment in full of all amounts payable under or in respect of
all Senior Debt of a Guarantor, the Holders shall be subrogated to the rights of
the holders of such Senior Debt to receive payments and distributions of cash,
property and securities of such Guarantor made on such Senior Debt until all
amounts due to be paid under the Guarantee shall be paid in full. For the
purposes of such subrogation, no payments or distributions to holders of Senior
Debt of any cash, property or securities to which Holders or the Trustee would
be entitled except for the provisions of this Article 11, and no payments over
pursuant to the provisions of this Article 11 to holders of Senior Debt by
Holders or the Trustee, shall, as among each Guarantor, its creditors other than
holders of Senior Debt and the Holders, be deemed to be a payment or
distribution by such Guarantor to or on account of such Senior Debt.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 11 shall have been
applied, pursuant to the provisions of this Article 11, to the payment of all
amounts payable under Senior Debt, then and in such case, the Holders shall be
entitled to receive from the holders of such Senior Debt at the time outstanding
any payments or distributions received by such holders of Senior Debt in excess
of the amount sufficient to pay all amounts payable under or in respect of such
Senior Debt in full in cash.
Section 11.06. Guarantee Subordination Provisions Solely To Define Relative
Rights.
The subordination provisions of this Article 11 are and are intended
solely for the purpose of defining the relative rights of the Holders on the one
hand and the holders of Senior Debt on the other hand. Nothing contained in
this Article 11 or elsewhere in this Indenture or in the Notes is intended to or
shall (a) impair, as among each Guarantor, its creditors other than holders of
its Senior Debt and the Holders, the obligation of such Guarantor, which is
absolute and unconditional, to make payments to the Holders in respect of its
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Obligations under its Guarantee in accordance with its terms; or (b) affect the
relative rights against such Guarantor of the Holders and creditors of such
Guarantor other than the holders of the Senior Debt; or (c) prevent the Trustee
or any Holder from exercising all remedies otherwise permitted by applicable law
upon a Default or an Event of Default under this Indenture, subject to the
rights, if any, under this Article 11 of the holders of Senior Debt (1) in any
case, proceeding, dissolution, liquidation or other winding-up, assignment for
the benefit of creditors or other marshaling of assets and liabilities of the
Company referred to in Section 11.02 hereof, to receive, pursuant to and in
accordance with such Section, cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder, or (2) under the conditions specified
in Section 11.03 hereof, to prevent any payment prohibited by such Section or
enforce their rights pursuant to Section 11.03(c) hereof.
The failure by any Guarantor to make a payment in respect of its
obligations on its Guarantee by reason of any provision of this Article 11 shall
not be construed as preventing the occurrence of a Default or an Event of
Default hereunder.
Section 11.07. Trustee To Effectuate Subordination.
Each Holder of an Obligation under a Guarantee by his acceptance
thereof authorizes and directs the Trustee on his behalf to take such action as
may be necessary or appropriate to effectuate the subordination provided in this
Article 11 and appoints the Trustee his attorney-in-fact for any and all such
purposes, including, in the event of any dissolution, winding-up, liquidation or
reorganization of a Guarantor whether in bankruptcy, insolvency, receivership
proceedings, or otherwise, the timely filing of a claim for the unpaid balance
of the indebtedness of such Guarantor owing to such Holder in the form required
in such proceedings.
Section 11.08. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior Debt to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of a Guarantor
or by any act or failure to act, in good faith, by any such holder, or by any
non-compliance by such Guarantor with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof any such holder may have or
be otherwise charged with.
(b) Without limiting the generality of paragraph (a) of this section,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 11 or the obligations hereunder of the
Holders to the holders of Senior Debt, do any one or more of the following: (1)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Debt or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding; (2) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Debt; (3) release any person liable in any manner for the collection or payment
of Senior Debt; and (4) exercise or refrain from exercising any rights against a
Guarantor and any other person; provided, however, that in no event shall any
such actions limit the right of the Holders to take any action to accelerate the
maturity of the Obligations under the Guarantees pursuant to Article 6 hereof or
to pursue any rights or remedies hereunder or under applicable laws if the
taking of such action does not otherwise violate the terms of this Indenture.
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Section 11.09. Notice to Trustee.
(a) A Guarantor shall give prompt written notice to the Trustee of any
fact known to such Guarantor which would prohibit the making of any payment to
or by the Trustee at its Corporate Trust Office in respect of the Notes.
Notwithstanding the provisions of this Article 11 or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Obligations under the Guarantees, unless and until the Trustee
shall have received written notice thereof from such Guarantor or a holder of
Senior Debt or from any trustee, fiduciary or agent therefor; and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
this Section 11.09, shall be entitled in all respects to assume that no such
facts exist; provided, however, that if the Trustee shall not have received the
notice provided for in this Section 11.09 at least five Business Days prior to
the date upon which by the terms hereof any money may become payable for any
purpose under this Indenture (including, without limitation, the payment of the
principal of, premium, if any, or interest on any Obligation under a Guarantee),
then, anything herein contained to the contrary notwithstanding but without
limiting the rights and remedies of the holders of Senior Debt or any trustee,
fiduciary or agent therefor, the Trustee shall have full power and authority to
receive such money and to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the contrary which may be
received by it within five Business Days prior to such date; nor shall the
Trustee be charged with knowledge of the curing of any such default or the
elimination of the act or condition preventing any such payment unless and until
the Trustee shall have received an Officers' Certificate to such effect.
(b) In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any person as a holder
of Senior Debt to participate in any payment or distribution pursuant to this
Article 11, the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Debt held by
such person, the extent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
person under this Article 11, 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 11.10. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of a Guarantor referred to
in this Article 11, the Trustee and the Holders shall be entitled to rely upon
any order or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding-up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other person making such payment or
distribution, delivered to the Trustee or to the Holders, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the holders of Senior Debt and other Indebtedness of such
Guarantor, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this
Article 11.
Section 11.11. No Suspension of Remedies.
Nothing contained in this Article 11 shall limit the right of the
Trustee or the Holders to take any action to accelerate the maturity of the
Obligations under the Guarantees pursuant to Article 6 or to pursue any rights
or remedies hereunder or under applicable law, subject to the rights, if any,
under this Article 11 of the holders, from time to time, of Senior Debt.
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ARTICLE 12
SUBORDINATION OF NOTES
Section 12.01. Notes Subordinate to Senior Debt.
The Company covenants and agrees, and the Trustee and each Holder by
its acceptance of Notes likewise covenants and agrees, that to the extent and in
the manner hereinafter set forth in this Article 12; the payment of all
Obligations on the Notes by the Company are hereby expressly made subordinate
and subject in right of payment as provided in this Article 12 to the prior
indefeasible payment in full in cash of all Senior Debt of the Company, whether
outstanding on the Issue Date or thereafter incurred.
This Section 12.01 and the following Sections 12.02 through 12.11
shall constitute a continuing offer to all Persons who, in reliance on such
provisions, become holders of or continue to hold Senior Debt of the Company;
and such provisions are made for the benefit of all the holders of Senior Debt
of the Company.
Section 12.02. Payment Over of Proceeds upon Dissolution, etc.
In the event of (a) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to the Company or to its creditors,
as such, or to its assets, whether voluntary or involuntary or (b) any
liquidation, dissolution or other winding-up of the Company, whether voluntary
or involuntary and whether or not involving insolvency or bankruptcy, or (c) any
general assignment for the benefit of creditors or any other marshalling of
assets or liabilities of the Company, then and in any such event:
(1) the holders of Senior Debt of the Company shall be entitled to
receive indefeasible payment in full in cash of all amounts due on
or in respect of all Senior Debt before the Holders are entitled to
receive or retain any payment or distribution of any kind or
character (other than a payment or distribution from the trust
described in Section 9.01 or Section 9.04) on account of any
Obligations on the Notes; and
(2) any payment or distribution of assets of the Company of any kind or
character, whether in cash, Property or securities, by set-off or
otherwise, to which the Holders or the Trustee would be entitled
but for the provisions of this Article 12 shall be paid by the
liquidating trustee or agent or other Person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of Senior
Debt or their representative or representatives or to the trustee
or trustees under any indenture under which any instruments
evidencing any of such Senior Debt may have been issued, ratably
according to the aggregate amounts remaining unpaid on account of
the Senior Debt held or represented by each, to the extent
necessary to make payment in full in cash of all Senior Debt
remaining unpaid, after giving effect to any concurrent payment or
distribution to the holders of such Senior Debt; and
(3) in the event that, notwithstanding the foregoing provisions of this
Section 12.02, the Trustee or any Holder shall have received any
payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, including,
without limitation, by way of set-off or otherwise, in respect of
the principal of, premium, if any, and interest on the Notes before
all Senior Debt is indefeasibly paid in full, then and in such
event such payment or distribution shall be
86
paid over or delivered forthwith to the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee, agent or other
Person making payment or distribution of assets of the Company for
application to the payment of all such Senior Debt remaining
unpaid, to the extent necessary to pay all Senior Debt in full in
cash or, as acceptable to the holders of such Senior Debt, any
other manner, after giving effect to any concurrent payment or
distribution, to or for the holders of such Senior Debt.
The consolidation of the Company with, or the merger of the Company
with or into, another Person or the liquidation or dissolution of the Company
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article 5 hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshaling of assets and liabilities of the Company for the purposes of this
Article 12 if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, comply
with the conditions set forth in such Article 5 hereof.
Section 12.03. Suspension of Payment When Senior Debt in Default.
(a) Unless Section 12.02 hereof shall be applicable, upon the
occurrence of a Payment Default on Designated Senior Debt of the Company, no
payment or distribution (other than a payment or distribution from the trust
described in Section 9.01 or Section 9.04) of any assets or securities of the
Company of any kind or character (including, without limitation, cash, property
and any payment or distribution which may be payable or deliverable by reason of
the payment of any other Indebtedness of the Company being subordinated to the
payment of the Notes by the Company) may be made by or on behalf of the Company
or any Restricted Subsidiary of the Company, including, without limitation, by
way of set-off or otherwise, for or on account of any Obligations under the
Notes or this Indenture, or for or on account of the purchase, redemption or
other acquisition of the Notes, and neither the Trustee nor any Holder shall
take or receive from the Company or any Restricted Subsidiary of the Company,
directly or indirectly in any manner, payment in respect of all or any portion
of Notes commencing on the date of receipt by the Trustee of written notice from
the representative of the holders of such Designated Senior Debt (the
"Representative") to the Trustee of written notice of the occurrence of a
Payment Default, and in any such event, such prohibition shall continue until
such Payment Default is cured, waived in writing or otherwise ceases to exist.
At such time as the prohibition set forth in the preceding sentence shall no
longer be in effect, subject to the provisions of the following paragraph (b),
the Company shall resume making any and all required payments in respect of the
Notes, including any missed payments.
(b) Unless Section 12.02 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on Designated Senior Debt of the
Company, no payment or distribution (other than a payment or distribution from
the trust described in Section 9.01 or Section 9.04) of any assets of the
Company of any kind or character (including, without limitation, cash, property
and any payment or distribution which may be payable or deliverable by reason of
the payment of any other Indebtedness of the Company being subordinated to the
payment of the Notes by the Company) shall be made by the Company or any
Restricted Subsidiary of the Company, including, without limitation, by way of
set-off or otherwise, on account of any Obligations under the Notes or this
Indenture or on account of the purchase, redemption, defeasance or other
acquisition of Notes and neither the Trustee nor any Holder or owner of any
Notes shall take or receive from the Company or any Restricted Subsidiary of the
Company, directly or indirectly in any manner, payment in respect of all or any
portion of the Notes for a period (the "Payment Blockage Period") commencing on
the date of receipt by the Trustee of written notice from the Representative of
such Non-Payment Event of Default unless and until (subject to any blockage of
payments that may then be in effect under the preceding paragraph (a)) the
earliest to
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occur of the following events: (w) more than 179 days shall have elapsed since
the date of receipt of such written notice by the Trustee, (x) such Non-Payment
Event of Default shall have been cured or waived in writing or shall have ceased
to exist, (y) such Designated Senior Debt shall have been discharged or
indefeasibly paid in full in cash or (z) such Payment Blockage Period shall have
been terminated by written notice to the Company or the Trustee from the
Representative initiating such Payment Blockage Period, after which, in the case
of clause (w), (x), (y) or (z), the Company shall resume making any and all
required payments in respect of the Notes, including any missed payments.
Notwithstanding any other provisions of this Indenture, no Non-Payment Event of
Default with respect to Designated Senior Debt which existed or was continuing
on the date of the commencement of any Payment Blockage Period initiated by the
Representative shall be, or be made, the basis for the commencement of a second
Payment Blockage Period initiated by the Representative unless such event of
default shall have been cured or waived for a period of not less than 90
consecutive days. In no event shall a Payment Blockage Period extend beyond 179
days from the date of the receipt by the Trustee of the notice referred to in
this Section 12.03(b) or in the event of a Non-Payment Event of Default which
formed the basis of a Guarantee Payment Blockage Period under Section 11.03(b)
hereof, 179 days from the default the receipt by the Trustee of the notice
referred to in Section 11.03(b) (the "Initial Blockage Period"). Any number of
additional Payment Blockage Periods may be commenced during the Initial Blockage
Period; provided, however, that no such additional Payment Blockage Period shall
extend beyond the Initial Blockage Period. After the expiration of the Initial
Blockage Period, no Payment Blockage Period may be commenced under this clause
(b) and no Guarantee Payment Blockage Period may be commenced under Section
11.03(b) hereof until at least 180 consecutive days have elapsed from the last
day of the Initial Blockage Period.
In the event that, notwithstanding the foregoing, the Trustee or any
holder of Notes receives any payment or distribution of assets of the Company of
any kind, whether in cash, property, or securities, including, without
limitation, by way of set-off or otherwise, in respect of the Notes before all
Senior Debt of the Company is paid and satisfied in full in cash, then such
payment or distribution will be held by the recipient in trust for the benefit
of holders of Senior Debt and will be immediately paid over or delivered to the
holders of Senior Debt or their representative or representatives to the extent
necessary to make payment in full of all Senior Debt remaining unpaid, after
giving effect to any concurrent payment or distribution, or provision therefor,
to or for the holders of Senior Debt.
(c) In the event that, notwithstanding the foregoing, the Trustee or
any Holder shall have received any payment prohibited by the foregoing
provisions of this Section 12.03, then and in such event such payment shall be
paid over and delivered forthwith to the Representative initiating the Payment
Blockage Period, in trust for distribution to the holders of Senior Debt or, if
no amounts are then due in respect of Senior Debt, promptly returned to the
Company, or otherwise as a court of competent jurisdiction shall direct.
Section 12.04. Trustee's Relation to Senior Debt.
The Trustee and any agent of the Company or the Trustee shall be
entitled to all the rights set forth in this Article 12 with respect to any
Senior Debt which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Senior Debt and nothing in
this Indenture shall deprive the Trustee or any such agent of any of its rights
as such holder.
With respect to the holders of 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 12, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt and the Trustee shall not be liable
to any holder of Senior Debt if it shall mistakenly pay over or deliver to
Holders, the Com-
88
pany or any other person moneys or assets to which any holder of Senior Debt
shall be entitled by virtue of this Article 12 or otherwise. Nothing in this
Section 12.04 shall affect the obligation of any other such person receiving
such payment or distribution from the Trustee or any other Agent to hold such
payment for the benefit of, and to pay such payment over to, the holders of
Senior Debt.
Section 12.05. Subrogation.
Upon the payment in full of all Senior Debt, the Holders shall be
subrogated to the rights of the holders of such Senior Debt to receive payments
and distributions of cash, property and securities applicable to the Senior Debt
until the principal of, premium, if any and interest on the Notes shall be paid
in full. For purposes of such subrogation, no payments or distributions to the
holders of Senior Debt of any cash, property or securities to which the Holders
or the Trustee would be entitled except for the provisions of this Article 12,
and no payments pursuant to the provisions of this Article 12 to the holders of
Senior Debt by Holders or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Debt and the Holders, be deemed to be a
payment or distribution by the Company to or on account of the Senior Debt.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 12 shall have been
applied, pursuant to the provisions of this Article 12, to the payment of all
amounts payable under the Senior Debt of the Company, then and in such case the
Holders shall be entitled to receive from the holders of such Senior Debt at the
time outstanding any payments or distributions received by such holders of such
Senior Debt in excess of the amount sufficient to pay all amounts payable under
or in respect of such Senior Debt in full in cash.
Section 12.06. Provisions Solely To Define Relative Rights.
The provisions of this Article 12 are and are intended solely for the
purpose of defining the relative rights of the Holders on the one hand and the
holders of Senior Debt on the other hand. Nothing contained in this Article 12
or elsewhere in this Indenture or in the Notes is intended to or shall (a)
impair, as among the Company, its creditors other than holders of Senior Debt
and the Holders, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders the principal of, premium, if any, and
interest on the Notes as and when the same shall become due and payable in
accordance with their terms; or (b) affect the relative rights against the
Company of the Holders and creditors of the Company other than the holders of
Senior Debt; or (c) prevent the Trustee or any Holder from exercising all
remedies otherwise permitted by applicable law upon a Default or an Event of
Default under this Indenture, subject to the rights, if any, under this Article
12 of the holders of Senior Debt (1) in any case, proceeding, dissolution,
liquidation or other winding-up, assignment for the benefit of creditors or
other marshaling of assets and liabilities of the Company referred to in Section
12.02 hereof, to receive, pursuant to and in accordance with such section, cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder, or (2) under the conditions specified in Section 12.03, to prevent any
payment prohibited by such section or enforce their rights pursuant to Section
12.03(c) hereof.
The failure to make a payment on account of principal of, premium, if
any, or interest on the Notes by reason of any provision of this Article 12
shall not be construed as preventing the occurrence of a Default or an Event of
Default hereunder.
89
Section 12.07. Trustee To Effectuate Subordination.
Each Holder of a Note by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the subordination provided in this Article 12 and appoints the
Trustee his attorney-in-fact for any and all such purposes, including, in the
event of any dissolution, winding-up, liquidation or reorganization of the
Company whether in bankruptcy, insolvency, receivership proceedings, or
otherwise, the timely filing of a claim for the unpaid balance of the
indebtedness of the Company owing to such Holder in the form required in such
proceedings.
Section 12.08. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior Debt to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
non-compliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof any such holder may have or be
otherwise charged with.
(b) Without limiting the generality of paragraph (a) of this section,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 12 or the obligations hereunder of the
Holders to the holders of Senior Debt, do any one or more of the following: (1)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Debt or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding; (2) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Debt; (3) release any person liable in any manner for the collection or payment
of Senior Debt; and (4) exercise or refrain from exercising any rights against
the Company and any other person; provided, however, that in no event shall any
such actions limit the right of the Holders to take any action to accelerate the
maturity of the Notes pursuant to Article 6 hereof or to pursue any rights or
remedies hereunder or under applicable laws if the taking of such action does
not otherwise violate the terms of this Indenture.
Section 12.09. Notice to Trustee
(a) 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 at its Corporate Trust Office in respect of the Notes.
Notwithstanding the provisions of this Article 12 or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Notes, unless and until the Trustee shall have received written
notice thereof from the Company or a holder of Senior Debt or from any trustee,
fiduciary or agent therefor; and, prior to the receipt of any such written
notice, the Trustee, subject to the provisions of this Section 12.09, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Trustee shall not have received the notice provided for in this
Section 12.09 at least five Business Days prior to the date upon which by the
terms hereof any money may become payable for any purpose under this Indenture
(including, without limitation, the payment of the principal of, premium, if
any, or interest on any Note), then, anything herein contained to the contrary
notwithstanding but without limiting the rights and remedies of the holders of
Senior Debt or any trustee, fiduciary or agent therefor, the Trustee shall have
full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it within five Business Days
prior to such date; nor shall the Trustee be charged with knowledge of the
curing of any such default or the elimination of the act or
90
condition preventing any such payment unless and until the Trustee shall have
received an Officers' Certificate to such effect.
(b) In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any person as a holder
of Senior Debt to participate in any payment or distribution pursuant to this
Article 12, the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Debt held by
such person, the extent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
person under this Article 12, and if such evidence is not furnished, the Trustee
may defer any payment to such person pending judicial determination as to the
right of such person to receive such payment.
Section 12.10. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Company referred to
in this Article 12, the Trustee and the Holders shall be entitled to rely upon
any order or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding-up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other person making such payment or
distribution, delivered to the Trustee or to the Holders, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the holders of Senior Debt and other Indebtedness of the Company,
the amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 12.
Section 12.11. No Suspension of Remedies.
Nothing contained in this Article 12 shall limit the right of the
Trustee or the Holders to take any action to accelerate the maturity of the
Notes pursuant to Article 6 or to pursue any rights or remedies hereunder or
under applicable law, subject to the rights, if any, under this Article 12 of
the holders, from time to time, of Senior Debt.
ARTICLE 13
MISCELLANEOUS
Section 13.01. TIA Controls.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
Section 13.02. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
91
If to the Company or any Guarantor:
IFCO Systems N.V.
"Rivierstaete", Amsteldijk 166
1079 LH
Amsterdam, The Netherlands
Telephone No.: 31-20-504-1772
Facsimile No.: 31-20-646-0793
Attention: Chief Financial Officer
and
92
IFCO Systems N.V.
c/o PalEx, Inc.
6829 Flintlock Road
Houston, Texas 77040
Telephone No.: 713-332-6145
Facsimile No.: 713-332-6146
Attention: Edward Rhyne, Esq.
Copy (which shall not constitute notices) to:
King & Spalding
1185 Avenue of the Americas
New York, New York 10036
Telephone No.: 212-556-2100
Facsimile No.: 212-556-2222
Attention: Stephen M. Wiseman, Esq.
If to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21W
New York, New York 10286
Telephone No.: 212 815-5734
Facsimile No.: 212 815-5915 or 212 815-5917
Attention: Corporate Trust Administration - Global Finance Unit
and
The Bank of New York
30 Cannon Street
London EC 4M 6XH, England
Telephone No.: 44-171-893-7298
Facsimile No.: 44-171-893-6369
Attention: Corporate Trust Administration
If to the Luxembourg Paying Agent:
Kredietbank S.A. Luxembourgeoise
43 Boulevard Royal
L-2955 Luxembourg
Telephone No.: 352-4797-3935
Facsimile No.: 352-4797-73951
Attention: Pauline Slierings
The Company, any Guarantor or the Trustee by written notice to the
others may designate additional or different addresses for subsequent notices or
communications. Any notice or communication to the Company, any Guarantors or
the Trustee, shall be deemed to have been given or made as of the date so
delivered if personally delivered; when answered back, if telexed; when receipt
is acknowledged, if telecopied; and
93
five (5) calendar days after mailing if sent by registered or certified mail,
postage prepaid (except that a notice of change of address shall not be deemed
to have been given until actually received by the addressee).
Any notice or communication mailed to a Noteholder shall be mailed to
him by first-class mail, postage prepaid, at his address shown on the register
kept by the Registrar.
Failure to mail a notice or communication to a Noteholder or any
defect in it shall not affect its sufficiency with respect to other Noteholders.
If a notice or communication to a Noteholder is mailed in the manner provided
above, it shall be deemed duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice as required
by this Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
Section 13.03. Communications by Holders with Other Holders.
Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes. The
Company, the Guarantors, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
Section 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company or any Guarantor to the
Trustee to take any action under this Indenture, the Company or such Guarantor,
as the case may be, shall furnish to the Trustee:
(1) an Officers' Certificate (which shall include the statements set
forth in Section 13.05 below) stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with;
and
(2) an Opinion of Counsel (which shall include the statements set forth
in Section 13.05 below) stating that, in the opinion of such
counsel, all such conditions precedent, if any, provided for in
this Indenture relating to the proposed action have been complied
with.
Section 13.05. Statements Required in Certificate and Opinion.
Each certificate and opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition and the definitions relating
thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of such person, it or he has made
such examination or investigation as is necessary to enable such
person to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
94
(4) a statement as to whether or not, in the opinion of such person,
such covenant or condition has been complied with; provided,
however, that with respect to matters of fact, an Opinion of
Counsel may rely on an Officers' Certificate or certificates of
public officials.
Section 13.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at meetings of
Noteholders. The Registrar and Paying Agent may make reasonable rules for their
functions.
Section 13.07. Business Days; Legal Holidays.
A "Business Day" is a day that is not a Legal Holiday. A "Legal
Holiday" is a Saturday, a Sunday, a federally-recognized holiday or a day on
which banking institutions are not required to be open in the State of New York
and London, England. If a payment date is a Legal Holiday at a place of
payment, payment may be made at that place on the next succeeding day that is
not a Legal Holiday, and no interest shall accrue for the intervening period.
Section 13.08. Governing Law.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE NOTES.
Section 13.09. Waiver of Trial by Jury.
The Company and each Guarantor hereby irrevocably waives any and all
rights to trial by jury in any legal proceeding arising out of or relating to
this Indenture.
Section 13.10. Sovereign Immunity.
To the extent that such rights may be lawfully waived, neither the
Company, nor any Guarantor, nor anyone claiming through or under the Company or
any Guarantor, shall set up, claim, or seek to take advantage of any
appraisement, valuation, stay, extension or redemption laws now or hereafter in
force, in order to prevent or hinder the enforcement of this Indenture, and the
Company and each Guarantor, for itself and all who may claim through or under
it, hereby waives, to the extent that it lawfully may do so the benefit of all
such laws including sovereign immunity and the act of state doctrine.
Section 13.11. Submission to Jurisdiction.
The Company and each Guarantor hereby consents to the jurisdiction of
a state or federal court situated in New York City, New York in connection with
any dispute arising hereunder. The Company and each Guarantor hereby
irrevocably waives, to the fullest extent permitted by applicable law, any
objection which it may now or hereafter have to the laying of venue of any such
proceeding brought in such a court and any claim that such proceeding brought in
such a court has been brought in an inconvenient forum.
95
Section 13.12. Appointment of Agent.
The Company and each Guarantor agree to designate CT Corporation
Systems, New York, New York, a Delaware corporation, as its authorized agent for
service of process, upon which process may be served in any action, suit or
proceeding which may be instituted in any state or federal court in the State of
New York arising out of or relating to this Indenture. A copy of any such
process shall be sent or given to the Company at the address for notices
specified in Section 13.02 hereof.
Section 13.13. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan,
security or debt agreement of the Company or any Subsidiary thereof. No such
indenture, loan, security or debt agreement may be used to interpret this
Indenture.
Section 13.14. No Recourse Against Others.
A director, officer, employee, stockholder or incorporator, as such,
of the Company or any Guarantor shall not have any liability for any obligations
of the Company or any Guarantor under the Notes, the Guarantees or this
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creations. Each Noteholder by accepting a Note waives and
releases all such liability. Such waiver and release are part of the
consideration for the issuance of the Notes.
Section 13.15. Successors.
All agreements of each of the Company and each Guarantor in this
Indenture and the Notes shall bind their respective successors. All agreements
of the Trustee, any additional trustee and any Paying Agents in this Indenture
shall bind its successor.
Section 13.16. Multiple Counterparts.
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent one and the same agreement.
Section 13.17. Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 13.18. Separability.
Each provision of this Indenture shall be considered separable and if
for any reason any provision which is not essential to the effectuation of the
basic purpose of this Indenture or the Notes 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.
96
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed all as of the date and year first written above.
Company:
IFCO SYSTEMS N.V.
By:/s/ EDWARD RHYNE
----------------------
Name: Edward Rhyne
Title: Executive Vice President
Guarantors:
IFCO EUROPE BETEILIGUNGS GMBH
By:/s/ CHRISTOPH SCHOELLER
-----------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
IFCO INTERNATIONAL FOOD CONTAINER ORGANISATION
GMBH
By:/s/ CHRISTOPH SCHOELLER
-----------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
IFCO FINANCE CONSULTING GMBH
By:/s/ CHRISTOPH SCHOELLER
-----------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
IFCO SKANDINAVIEN A/S
By:/s/ CHRISTOPH SCHOELLER
-----------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
97
GISO VERWALTUNGSGESELLSCHAFT MBH & CO.
BEHALTERLEASING KG
By: /s/ CHRISTOPH SCHOELLER
-----------------------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
MTS OKOLOGISTIK VERWALTUNGS GMBH
By: /s/ CHRISTOPH SCHOELLER
-------------------------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
SCHOELLER INTERNATIONAL LOGISTICS
BETEILIGUNGSGESELLSCHAFT MBH
By: /s/ CHRISTOPH SCHOELLER
---------------------------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
IFCO ARGENTINA S.A.
By: /s/ CHRISTOPH SCHOELLER
-----------------------------------
Name: Christoph Schoeller
Title: Chairman of the Board and
Authorized Signatory
PALEX, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
ACME BARREL COMPANY, INC.
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
98
BAY AREA PALLET COMPANY
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
BLACK RIVER FOREST PRODUCTS, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
CHARLOTTE STEEL DRUM CORPORATION
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
CONSOLIDATED CONTAINER CORPORATION
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
CONTAINER RESOURCES CORPORATION
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
CONTAINER SERVICES COMPANY NW, INC.
(F/K/A CONTAINER SERVICES COMPANY NW
ACQUISITION, INC.)
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
99
CONTAINER SERVICES COMPANY SW, INC.
(F/K/A CONTAINER SERVICES COMPANY SW
ACQUISITION, INC.)
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
DUCKERT PALLET CO., INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
DRUM SERVICE CO. OF FLORIDA
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
ENVIRONMENTAL RECYCLERS OF COLORADO, INC.
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
GILBERT LUMBER INCORPORATED
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
100
ISAACSON LUMBER COMPANY
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
INTERSTATE PALLET CO., INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
NEW LONDON PALLET, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
PALEX CONTAINER SYSTEMS, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
PALEX-TEXAS, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
PALEX-TEXAS, L.P.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
101
PALEX TEXAS HOLDINGS, INC.
By: /s/ CASEY FLETCHER
-----------------------------------
Name: Casey Fletcher
Title: President
PALLET OUTLET COMPANY, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
RIDGE PALLETS, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
SHEFFIELD LUMBER AND PALLET COMPANY, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
SHIPSHEWANA PALLET CO., INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
SMG CORPORATION
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
102
SONOMA PACIFIC COMPANY
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
SOUTHERN PALLET, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
VALLEY CRATING AND PACKAGING, INC.
By: /s/ EDWARD RHYNE
-----------------------------------
Name: Edward Rhyne
Title: Vice President
WESTERN CONTAINER LIMITED LIABILITY COMPANY
By: /s/ BARRY SLAVIN
-----------------------------------
Name: Barry Slavin
Title: Vice President
Trustee:
THE BANK OF NEW YORK,
as Trustee
By: /s/ CARLOS J. CAPELLAN
-----------------------------------
Name: Carlos J. Capellan
Title: Assistant Treasurer
Exhibit A
[FORM OF LEGEND FOR GLOBAL NOTES]
Any Global Note authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS NOTE IS HELD BY THE COMMON DEPOSITORY (AS DEFINED IN THE
INDENTURE GOVERNING THIS SECURITY) IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS
MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL
NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06 OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.10 OF THE INDENTURE AND (IV) THIS GLOBAL
NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY.
A-1
Exhibit B-1
(FACE OF NOTE)
[FORM OF SERIES A NOTE]
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION
HEREOF, THE HOLDER AGREES THAT (1) IT WILL NOT PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") THAT IS TWO YEARS AFTER THE LATER OF
THE ORIGINAL ISSUANCE OF THIS NOTE AND THE LAST DATE ON WHICH IFCO SYSTEMS
N.V., OR ANY AFFILIATE OF IFCO SYSTEMS N.V. WAS THE OWNER OF THIS NOTE (OR
ANY PREDECESSOR OF THIS NOTE), RESELL OR OTHERWISE TRANSFER THIS NOTE
EXCEPT (A) TO IFCO SYSTEMS N.V. OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE
UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE
144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF SUBPARAGRAPH
(a)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT, PRIOR TO
SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S. BROKER-
DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE
FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER
THE SECURITIES ACT, (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (2) WILL GIVE
TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS NOTE
PRIOR TO THE RESALE RESTRICTION TERMINATION DATE, IF THE PROPOSED TRANSFER
IS BEING MADE PURSUANT TO CLAUSE (C) OR (E) ABOVE, PRIOR TO SUCH TRANSFER,
THE HOLDER WILL BE REQUIRED TO FURNISH TO THE TRUSTEE AND IFCO SYSTEMS N.V.
SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS ANY OF THEM MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO
AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO
THEM BY REGULATION S UNDER THE SECURITIES ACT.
B-1-1
CUSIP No.:
ISIN No.:
Common Code No.:
IFCO SYSTEMS N.V.
10 5/8% SENIOR SUBORDINATED NOTE DUE 2010
No. (EURO)
IFCO SYSTEMS N.V., a limited liability company incorporated in the
Netherlands (the "Company," which term includes any successor entity), for value
received promises to pay to or registered assigns, the principal sum
of (EURO) on March 15, 2010.
Interest Payment Dates: March 15 and September 15, commencing
September 15, 2000.
Record Dates: March 1 and September 1.
Reference is made to the further provisions of this Note contained
herein and the Indenture (as defined), which will for all purposes have the same
effect as if set forth at this place.
B-1-2
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized directors, officers or other
authorized signatories.
IFCO SYSTEMS N.V.
By:
--------------------------------
Name:
Title:
By:
--------------------------------
Name:
Title:
B-1-3
Certificate of Authentication
This is one of the 10 5/8% Senior Subordinated Notes due 2010 referred
to in the within-mentioned Indenture.
THE BANK OF NEW YORK
as Trustee
By:
--------------------------------
Authorized Signatory
B-1-4
(REVERSE OF SECURITY)
10 5/8% SENIOR SUBORDINATED NOTE DUE 2010
1. Interest. IFCO SYSTEMS N.V., a limited liability company
incorporated in the Netherlands (the "Company"), promises to pay interest on the
principal amount of this Note at the rate per annum shown above. Interest on the
Notes will accrue from the most recent date on which interest has been paid or,
if no interest has been paid, from the date of the original issuance of the
Notes. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing September 15, 2000. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and on overdue
installments of interest (without regard to any applicable grace periods) to the
extent lawful from time to time on demand at the rate borne by the Notes.
2. Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on March 1 or September 1 immediately preceding the Interest
Payment Date (whether or not such day is a Business Day) even if the Notes are
cancelled on registration of transfer or registration of exchange after such
Record Date. Holders must surrender Notes to a Paying Agent to collect principal
payments. Payments of principal and premium, if any, will be made (on
presentation of such Notes if in certificated form) in Euros; provided, however,
that the Company may pay principal, premium, if any, and interest by check
payable in Euros. The Company may deliver any such interest payment to the
Paying Agent or to a Holder at the Holder's registered address.
3. Paying Agents and Registrar. Initially, The Bank of New York, a
banking organization organized under the laws of New York (the "Trustee"), and
Kredietbank S.A. Luxembourgeoise, a banking organization organized under the
laws of Luxembourg will act as Paying Agents and the Trustee will act as
Registrar. The Company may change any Paying Agents, Registrar or co-Registrar
without notice to the Holders. Neither the Company nor any of its Subsidiaries
or Affiliates may act as Paying Agent but may act as Registrar or co-Registrar.
4. Indenture. The Company issued this Note under an Indenture, dated
as of March 8, 2000 (the "Indenture"), by and among the Company, the Guarantors
and the Trustee. This Note is one of a duly authorized issue of Initial Notes of
the Company designated as its 10 5/8% Senior Subordinated Notes due 2010 (the
"Notes"). The Notes are limited in aggregate principal amount to (Euro)200.0
million. The Notes include the Initial Notes and the Exchange Notes (as defined
below) issued in exchange for the Initial Notes pursuant to the Indenture. The
Initial Notes and the Exchange Notes are treated as a single class of securities
under the Indenture. Capitalized terms herein are used as defined in the
Indenture unless otherwise defined herein. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S. Code (S)(S) 77aaa-77bbbb) (the "TIA"), as
in effect on the date of the Indenture. Notwithstanding anything to the contrary
herein, the Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and the TIA for a statement of them. The Notes are
general unsecured obligations of the Company.
5. Subordination. The Notes are general unsecured obligations of the
Company and subordinated in right of payment, in the manner and to the extent
set forth in the Indenture, to the prior payment in full in cash of all Senior
Debt of the Company, and senior in right of payment to any current or future
subordinated indebtedness of the Company. Each Holder by his acceptance hereof
agrees to be bound by such provisions and authorizes and expressly directs the
Trustee, on his behalf, to take such action as may be necessary or
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appropriate to effectuate the subordination provided for in the Indenture and
appoints the Trustee his attorney-in-fact for such purposes.
6. Guarantee. The obligations of the Company hereunder are guaranteed
on a senior subordinated basis by the Guarantors. Each Guarantee by a Guarantor
is subordinated in right of payment to all Senior Debt of such Guarantor to the
same extent that the Notes are subordinated to Senior Debt of the Company.
7. Redemption.
(a) Optional Redemption. The Company may redeem the Notes, at its
option, in whole at any time or in part from time to time, on and after March
15, 2005 at the following Redemption Prices (expressed as percentages of the
principal amount thereof) if redeemed during the twelve-month period commencing
on March 15 of the year set forth below, plus, in each case, accrued and unpaid
interest thereon, if any, to the date of redemption.
Year Percentage
- ----- ----------
2005...................................................... 105.3125%
2006...................................................... 103.5417%
2007...................................................... 101.7708%
2008 and thereafter....................................... 100.0000%
(b) Optional Redemption Upon Equity Offerings. Notwithstanding the
foregoing, the Company may redeem in the aggregate up to 35% of the original
principal amount of Notes at any time and from time to time prior to March 15,
2003 at a Redemption Price equal to 110.625% of the aggregate principal amount
so redeemed, plus accrued and unpaid interest, if any, to the Redemption Date
out of the Net Proceeds of one or more Equity Offerings; provided that
(1) at least 65% of the principal amount of Notes originally issued
remains outstanding immediately after the occurrence of any such
redemption and
(2) any such redemption occurs within 60 days following the closing of
any such Equity Offering.
(c) The Company may effect a tax redemption of the Notes, as a whole
but not as part, at 100% of the principal amount thereof as provided in Section
3.07 of the Indenture.
8. Notice of Redemption. Notice of redemption under paragraphs 7(a)
and 7(b) of this Note will be mailed at least 30 days but not more than 60 days
before the Redemption Date to each Holder of Notes to be redeemed at such
Holder's registered address.
Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then, unless the Company defaults in the
payment of such Redemption Price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the Redemption Price plus accrued interest, if any.
9. Offers to Purchase. The Indenture provides that, after certain
Asset Sales (as defined in the Indenture) and upon the occurrence of a Change of
Control (as defined in the Indenture), and subject to
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further limitations contained therein, the Company will make an offer to
purchase certain amounts of the Notes in accordance with the procedures set
forth in the Indenture.
10. Registration Rights. Pursuant to the Registration Rights
Agreement by and among the Company, the Guarantors and the Initial Purchasers,
the Company will be obligated to consummate an exchange offer pursuant to which
the Holder of this Note shall have the right to exchange this Note for the
Company's Series B 10 5/8% Senior Subordinated Notes due 2010 (the "Exchange
Notes"), which have been registered under the Securities Act, in like principal
amount and having terms identical in all material respects to the Initial Notes.
The Holders of the Initial Notes shall be entitled to receive certain Additional
Interest payments in the event such exchange offer is not consummated and upon
certain other conditions, all pursuant to and in accordance with the terms of
the Registration Rights Agreement.
11. Denominations; Transfer; Exchange. The Notes are in registered
form, without coupons, in minimum denominations of (Euro)50,000 and in
increments of (Euro)1,000 above (Euro)50,000. A Holder shall register the
transfer or exchange of Notes in accordance with the Indenture. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and to pay certain transfer taxes or similar governmental
charges payable in connection therewith as permitted by the Indenture. The
Registrar need not register the transfer of or exchange of any Notes or portions
thereof selected for redemption.
12. Persons Deemed Owners. The registered Holder of a Note shall be
treated as the owner of it for all purposes.
13. Unclaimed Money. If money for the payment of principal or
interest remains unclaimed for two years, the Trustee and the Paying Agent will
pay the money back to the Company. After that, Holders entitled to money must
look to the Company for payment as general creditors unless an "abandoned
property" law designates another person.
14. Defeasance and Covenant Defeasance. If the Company at any time
deposits with the Trustee Euros sufficient to pay the principal of and interest
on the Notes to redemption or maturity and complies with the other provisions of
the Indenture relating to defeasance, the Company will be discharged from
certain provisions of the Indenture and the Notes (including certain covenants,
but excluding its obligation to pay the principal of and interest on the Notes).
15. Amendments, Supplements, and Waivers. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
written consent of the holders of at least a majority in aggregate principal
amount of the Notes then outstanding, and any existing Default or Event of
Default or noncompliance with any provision may be waived with the written
consent of the holders of a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Notes in addition to or in place of certificated Notes or make any other change
that does not adversely affect in any material respect the rights of any Holder
of a Note.
16. Restrictive Covenants. The Indenture imposes certain limitations
on the ability of the Company and its Subsidiaries to, among other things, incur
additional Indebtedness, make payments in respect of its Capital Stock, enter
into transactions with Affiliates, create dividend or other payment restrictions
affecting Subsidiaries, merge or consolidate with any other person, or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all
of its assets. Such limitations are subject to a number of important
qualifications and exceptions. The Company must annually report to the Trustee
on compliance with such limitations.
17. Successor Entity. When a successor entity assumes, in accordance
with the Indenture, all the obligations of its predecessor under the Notes and
the Indenture, and immediately before and there-
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after no Default exists and certain other conditions are satisfied, the
predecessor entity will be released from those obligations.
18. Defaults and Remedies. Events of Default are set forth in the
Indenture. If an Event of Default (other than an Event of Default pursuant to
Section 6.01(f) or (g) of the Indenture) shall have occurred and be continuing,
then the Trustee or the holders of not less than 25% in aggregate principal
amount of the Notes then outstanding, may declare to be immediately due and
payable the entire principal amount of all the Notes then outstanding plus
accrued interest to the date of acceleration; provided, however, that after such
acceleration but before a judgment or decree based on such acceleration is
obtained by the Trustee, the holders of a majority in aggregate principal amount
of the outstanding Notes may rescind and annul such acceleration and its
consequences if all existing Events of Default, other than the nonpayment of
principal, premium, if any, or interest that has become due solely because of
the acceleration, have been cured or waived. No such rescission shall affect any
subsequent Default or impair any right consequent thereto. In case an Event of
Default specified in Section 6.01(f) or (g) of the Indenture occurs, such
principal amount, together with premium, if any, and interest with respect to
all of the Notes, shall be due and payable immediately without any declaration
or other act on the part of the Trustee or the Holders of the Notes.
19. Trustee Dealings with Company. The Trustee under the Indenture,
in its individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company, and may otherwise deal with the
Company, its Subsidiaries or their respective Affiliates as if it were not the
Trustee.
20. No Recourse Against Others. As more fully described in the
Indenture, no director, officer, employee, stockholder or incorporator, as such,
of the Company shall have any liability for any obligation of the Company under
the Notes or the Indenture or for any claim based on, in respect of or by reason
of such obligations or their creation. Each Noteholder by accepting a Note
waives and releases all such liability. Such waiver and release are part of the
consideration for the issuance of the Notes.
21. Authentication. This Note shall not be valid until the Trustee
or Authenticating Agent manually signs the certificate of authentication on this
Note.
22. Governing Law. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES TO THE INDENTURE HAS AGREED 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 NOTE.
23. Abbreviations and Defined Terms. Customary abbreviations may be
used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
24. CUSIP, ISIN and Common Code Numbers. The Company has caused
CUSIP, ISIN and Common Code numbers to be printed on the Notes as a convenience
to the Holders. No representation is made as to the accuracy of such numbers as
printed on the Notes and reliance may be placed only on the other identification
numbers printed hereon.
25. Indenture. Each Holder, by accepting a Note, agrees to be bound
by all of the terms and provisions of the Indenture, as the same may be amended
from time to time.
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The Company will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture, which has the text of this Note in
larger type. Requests may be made to: IFCO Systems N.V. "Rivierstaete,"
Amsteldijk 166, 1079 LH, Amsterdam, The Netherlands, Attention: Chief Financial
Officer, or to IFCO Systems N.V., c/o PalEx, Inc., 6829 Flintlock Road, Houston,
Texas 77040, Attention: Chief Financial Officer.
B-1-9
FORM OF GUARANTEE
SENIOR SUBORDINATED GUARANTEE
Each Guarantor (capitalized terms used herein have the meanings given
such terms in the Indenture referred to in the Note upon which this notation is
endorsed) hereby unconditionally guarantees on a senior subordinated basis (such
guarantee being referred to herein as the "Guarantee") the due and punctual
payment of the principal of, premium, if any, and interest on the Notes and all
other amounts payable by the Company, whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on the overdue principal,
premium and interest on the Notes, and the due and punctual performance of all
other obligations of the Company to the Holders or the Trustee, all in
accordance with the terms set forth in Article 10 of the Indenture.
The obligations of each Guarantor to the Holders and to the Trustee
pursuant to the Guarantee and the Indenture are expressly set forth, and are
expressly subordinated and subject in right of payment to the prior payment in
full of all Senior Debt of each Guarantor, to the extent and in the manner
provided in Article 11 of the Indenture.
This Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Notes upon which this Guarantee is
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
This Guarantee shall be governed by and construed in accordance with
the laws of the State of New York without regard to principles of conflicts of
law.
This Guarantee is subject to release upon the terms set forth in
Section 10.06 of the Indenture.
IFCO EUROPE BETEILIGUNGS GMBH
By:
----------------------------
Name:
Title:
IFCO INTERNATIONAL FOOD CONTAINER ORGANISATION
GMBH
By:
----------------------------
Name:
Title:
B-1-10
IFCO FINANCE CONSULTING GMBH
By:
----------------------------------------
Name:
Title:
IFCO SKANDINAVIEN A/S
By:
----------------------------------------
Name:
Title:
GISO VERWALTUNGSGESELLSCHAFT MBH & CO.
BEHALTERLEASING KG
By:
----------------------------------------
Name:
Title:
IFCO ARGENTINA S.A.
By:
----------------------------------------
Name:
Title:
PALEX, INC.
By:
----------------------------------------
Name:
Title:
ACME BARREL COMPANY, INC.
By:
----------------------------------------
Name:
Title:
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BAY AREA PALLET COMPANY
By:
-----------------------------------
Name:
Title:
BLACK RIVER FOREST PRODUCTS, INC.
By:
-----------------------------------
Name:
Title:
CHARLOTTE STEEL DRUM CORPORATION
By:
-----------------------------------
Name:
Title:
CONSOLIDATED CONTAINER CORPORATION
By:
-----------------------------------
Name:
Title:
CONTAINER RESOURCES CORPORATION
By:
-----------------------------------
Name:
Title:
CONTAINER SERVICES COMPANY NW, INC.
(F/K/A CONTAINER SERVICES COMPANY NW
ACQUISITION, INC.)
By:
-----------------------------------
Name:
Title:
B-1-12
CONTAINER SERVICES COMPANY SW, INC.
(F/K/A CONTAINER SERVICES COMPANY SW
ACQUISITION, INC.)
By:
-----------------------------------
Name:
Title:
DUCKERT PALLET CO., INC.
By:
-----------------------------------
Name:
Title:
DRUM SERVICE CO. OF FLORIDA
By:
-----------------------------------
Name:
Title:
ENVIRONMENTAL RECYCLERS OF COLORADO, INC.
By:
-----------------------------------
Name:
Title:
GILBERT LUMBER INCORPORATED
By:
-----------------------------------
Name:
Title:
ISAACSON LUMBER COMPANY
By:
-----------------------------------
Name:
Title:
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INTERSTATE PALLET CO., INC.
By:
-----------------------------------
Name:
Title:
NEW LONDON PALLET, INC.
By:
-----------------------------------
Name:
Title:
PALEX CONTAINER SYSTEMS, INC.
By:
-----------------------------------
Name:
Title:
PALEX-TEXAS, INC.
By:
-----------------------------------
Name:
Title:
PALEX-TEXAS, L.P.
By:
-----------------------------------
Name:
Title:
PALEX TEXAS HOLDINGS, INC.
By:
-----------------------------------
Name:
Title:
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PALLET OUTLET COMPANY, INC.
By:
-----------------------------------
Name:
Title:
RIDGE PALLETS, INC.
By:
-----------------------------------
Name:
Title:
SHEFFIELD LUMBER AND PALLET COMPANY, INC.
By:
-----------------------------------
Name:
Title:
SHIPSHEWANA PALLET CO., INC.
By:
-----------------------------------
Name:
Title:
SMG CORPORATION
By:
-----------------------------------
Name:
Title:
SONOMA PACIFIC COMPANY
By:
-----------------------------------
Name:
Title:
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SOUTHERN PALLET, INC.
By:
-----------------------------------
Name:
Title:
VALLEY CRATING AND PACKAGING, INC.
By:
-----------------------------------
Name:
Title:
WESTERN CONTAINER LIMITED LIABILITY COMPANY
By:
-----------------------------------
Name:
Title:
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ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and
have your signature guaranteed:
I or we assign and transfer this Note to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint ,
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Date: Signed:
--------------------------- ----------------------------------
(Sign exactly as your name appears
on the other side of this Note)
Medallion Guarantee:
------------------------
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[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.13 or Section 4.17 of the Indenture, check the appropriate
box:
Section 4.13 [ ]
Section 4.17 [ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.13 or Section 4.17 of the Indenture, state the
amount you elect to have purchased:
(EURO) __________________
Date:
-------------------------------- --------------------------------------
NOTICE: The signature on this assignment
must correspond with the name as it
appears upon the face of the within Note
in every particular without alteration
or enlargement or any change whatsoever
and be guaranteed by the endorser's bank
or broker.
Medallion Guarantee:
--------------------------
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EXHIBIT B-2
CUSIP No.
ISIN No.:
Common Code No.:
IFCO SYSTEMS N.V.
SERIES B 10 5/8% SENIOR SUBORDINATED NOTE DUE 2010
No. (EURO)
IFCO SYSTEMS N.V., a limited liability company incorporated in the
Netherlands (the "Company," which term includes any successor entity), for value
received promises to pay to or registered assigns, the principal sum
of (EURO) on March 15, 2010.
Interest Payment Dates: March 15 and September 15, commencing
September 15, 2000.
Record Dates: March 1 and September 1
Reference is made to the further provisions of this Note contained
herein and the Indenture (as defined), which will for all purposes have the same
effect as if set forth at this place.
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IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized directors, officers or other
authorized signatories.
IFCO SYSTEMS N.V.
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
B-2-2
Certificate of Authentication
This is one of the Series B 10 5/8% Senior Subordinated Notes due 2010
referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK
as Trustee
By:
-----------------------------------
Authorized Signatory
B-2-3
(REVERSE OF SECURITY)
10 5/8% SENIOR SUBORDINATED NOTE DUE 2010
1. Interest. IFCO SYSTEMS N.V., a limited liability company
incorporated in the Netherlands (the "Company"), promises to pay interest on the
principal amount of this Note at the rate per annum shown above. Interest on the
Notes will accrue from the most recent date on which interest has been paid or,
if no interest has been paid, from the date of the original issuance of the
Notes. The Company will pay interest semi-annually in arrears on each Interest
Payment Date, commencing September 15, 2000. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and on overdue
installments of interest (without regard to any applicable grace periods) to the
extent lawful from time to time on demand at the rate borne by the Notes.
2. Method of Payment. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on March 1 or September 1 immediately preceding the Interest
Payment Date (whether or not such day is a Business Day) even if the Notes are
cancelled on registration of transfer or registration of exchange after such
Record Date. Holders must surrender Notes to a Paying Agent to collect principal
payments. Payments of principal and premium, if any, will be made (on
presentation of such Notes if in certificated form) in Euros; provided, however,
that the Company may pay principal, premium, if any, and interest by check
payable in Euros. The Company may deliver any such interest payment to the
Paying Agent or to a Holder at the Holder's registered address.
3. Paying Agents and Registrar. Initially, The Bank of New York, a
banking organization organized under the laws of New York (the "Trustee"), and
Kredietbank S.A. Luxembourgeoise, a banking organization organized under the
laws of Luxembourg will act as Paying Agents and the Trustee will act as
Registrar. The Company may change any Paying Agents, Registrar or co-Registrar
without notice to the Holders. Neither the Company nor any of its Subsidiaries
or Affiliates may act as Paying Agent but may act as Registrar or co-Registrar.
4. Indenture. The Company issued this Note under an Indenture, dated
as of March 8, 2000 (the "Indenture"), by and among the Company, the Guarantors
and the Trustee. This Note is one of a duly authorized issue of Notes of the
Company designated as its Series B 10 5/8% Senior Subordinated Notes due 2010
(the "Exchange Notes") issued in exchange for the initial 10 5/8% Senior
Subordinated Notes due 2010 (the "Initial Notes" and, together with the Exchange
Notes, the "Notes"). The Notes are limited in aggregate principal amount to
(Euro)200.0 million. Capitalized terms herein are used as defined in the
Indenture unless otherwise defined herein. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S. Code (S)(S) 77aaa-77bbbb) (the "TIA"), as
in effect on the date of the Indenture. Notwithstanding anything to the contrary
herein, the Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and the TIA for a statement of them. The Notes are
general unsecured obligations of the Company.
5. Subordination. The Notes are general unsecured obligations of the
Company and subordinated in right of payment, in the manner and to the extent
set forth in the Indenture, to the prior payment in full in cash of all Senior
Debt of the Company, whether outstanding on the date of the Indenture or
thereafter created, incurred, assumed or guaranteed. Each Holder by his
acceptance hereof agrees to be bound by such provisions and authorizes and
expressly directs the Trustee, on his behalf, to take such action as may be
necessary or appropriate to effectuate the subordination provided for in the
Indenture and appoints the Trustee his attorney-in-fact for such purposes.
B-2-4
6. Guarantee. The obligations of the Company hereunder are guaranteed
on a senior subordinated basis by the Guarantors. Each Guarantee by a Guarantor
is subordinated in right of payment to all Senior Debt of such Guarantor to the
same extent that the Notes are subordinated to Senior Debt of the Company.
7. Redemption.
(a) Optional Redemption. The Company may redeem the Notes, at its
option, in whole at any time or in part from time to time, on and after March
15, 2005 at the following Redemption Prices (expressed as percentages of the
principal amount thereof) if redeemed during the twelve-month period commencing
on March 15 of the year set forth below, plus, in each case, accrued and unpaid
interest thereon, if any, to the date of redemption.
Year Percentage
- ---- -----------
2005............................................... 105.3125%
2006............................................... 103.5417%
2007............................................... 101.7708%
2008 and thereafter................................ 100.0000%
(b) Optional Redemption Upon Equity Offerings. Notwithstanding the
foregoing, the Company may redeem in the aggregate up to 35% of the original
principal amount of Notes at any time and from time to time prior to March [1],
2003 at a Redemption Price equal to 110.625% of the aggregate principal amount
so redeemed, plus accrued and unpaid interest, if any, to the Redemption Date
out of the Net Proceeds of one or more Equity Offerings; provided that
(1) at least 65% of the principal amount of Notes originally issued
remains outstanding immediately after the occurrence of any such
redemption and
(2) any such redemption occurs within 60 days following the closing of
any such Equity Offering.
(c) The Company may effect a tax redemption of the Notes, as a whole
but not in part, at 100% of the principal amount thereof as provided in Section
3.07 of the Indenture.
8. Notice of Redemption. Notice of redemption under paragraphs 7(a)
and 7(b) of this Note will be mailed at least 30 days but not more than 60 days
before the Redemption Date to each Holder of Notes to be redeemed at such
Holder's registered address.
Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then, unless the Company defaults in the
payment of such Redemption Price plus accrued interest, if any, the Notes called
for redemption will cease to bear interest from and after such Redemption Date
and the only right of the Holders of such Notes will be to receive payment of
the Redemption Price plus accrued interest, if any.
9. Offers to Purchase. The Indenture provides that, after certain
Asset Sales (as defined in the Indenture) and upon the occurrence of a Change of
Control (as defined in the Indenture), and subject to further limitations
contained therein, the Company will make an offer to purchase certain amounts of
the Notes in accordance with the procedures set forth in the Indenture.
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10. Denominations; Transfer; Exchange. The Notes are in registered
form, without coupons, in minimum denominations of (Euro)50,000 and in
increments of (Euro)1,000 above (Euro)50,000. A Holder shall register the
transfer or exchange of Notes in accordance with the Indenture. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and to pay certain transfer taxes or similar governmental
charges payable in connection therewith as permitted by the Indenture. The
Registrar need not register the transfer of or exchange of any Notes or portions
thereof selected for redemption.
11. Persons Deemed Owners. The registered Holder of a Note shall be
treated as the owner of it for all purposes.
12. Unclaimed Money. If money for the payment of principal or
interest remains unclaimed for two years, the Trustee and the Paying Agent will
pay the money back to the Company. After that, Holders entitled to money must
look to the Company for payment as general creditors unless an "abandoned
property" law designates another person.
13. Defeasance and Covenant Defeasance. If the Company at any time
deposits with the Trustee Euros sufficient to pay the principal of and interest
on the Notes to redemption or maturity and complies with the other provisions of
the Indenture relating to defeasance, the Company will be discharged from
certain provisions of the Indenture and the Notes (including certain covenants,
but excluding its obligation to pay the principal of and interest on the Notes).
14. Amendments, Supplements, and Waivers. Subject to certain
exceptions, the Indenture or the Notes may be amended or supplemented with the
written consent of the holders of at least a majority in aggregate principal
amount of the Notes then outstanding, and any existing Default or Event of
Default or noncompliance with any provision may be waived with the written
consent of the holders of a majority in aggregate principal amount of the Notes
then outstanding. Without notice to or consent of any Holder, the parties
thereto may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency, provide for uncertificated
Notes in addition to or in place of certificated Notes or make any other change
that does not adversely affect in any material respect the rights of any Holder
of a Note.
15. Restrictive Covenants. The Indenture imposes certain limitations
on the ability of the Company and its Subsidiaries to, among other things, incur
additional Indebtedness, make payments in respect of its Capital Stock, enter
into transactions with Affiliates, create dividend or other payment restrictions
affecting Subsidiaries, merge or consolidate with any other person, or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all
of its assets. Such limitations are subject to a number of important
qualifications and exceptions. The Company must annually report to the Trustee
on compliance with such limitations.
16. Successor Entity. When a successor entity assumes, in accordance
with the Indenture, all the obligations of its predecessor under the Notes and
the Indenture, and immediately before and thereafter no Default exists and
certain other conditions are satisfied, the predecessor entity will be released
from those obligations.
17. Defaults and Remedies. Events of Default are set forth in the
Indenture. If an Event of Default (other than an Event of Default pursuant to
Section 6.01(f) or (g) of the Indenture) shall have occurred and be continuing,
then the Trustee or the holders of not less than 25% in aggregate principal
amount of the Notes then outstanding, may declare to be immediately due and
payable the entire principal amount of all the Notes then outstanding plus
accrued interest to the date of acceleration; provided, however, that after such
acceleration but before a judgment or decree based on such acceleration is
obtained by the Trustee, the holders of a majority in aggregate principal amount
of the outstanding Notes may rescind and annul such acceleration and its
consequences if all existing Events of Default, other than the nonpayment of
principal, premium, if any, or interest that has become due solely because of
the acceleration, have been cured or waived. No such rescission shall
B-2-6
affect any subsequent Default or impair any right consequent thereto. In case an
Event of Default specified in Section 6.01(f) or (g) of the Indenture occurs,
such principal amount, together with premium, if any, and interest with respect
to all of the Notes, shall be due and payable immediately without any
declaration or other act on the part of the Trustee or the Holders of the Notes.
18. Trustee Dealings with Company. The Trustee under the Indenture,
in its individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company, and may otherwise deal with the
Company, its Subsidiaries or their respective Affiliates as if it were not the
Trustee.
19. No Recourse Against Others. As more fully described in the
Indenture, no director, officer, employee, stockholder or incorporator, as such,
of the Company shall have any liability for any obligation of the Company under
the Notes or the Indenture or for any claim based on, in respect of or by reason
of such obligations or their creation. Each Noteholder by accepting a Note
waives and releases all such liability. Such waiver and release are part of the
consideration for the issuance of the Notes.
20. Authentication. This Note shall not be valid until the Trustee
or Authenticating Agent manually signs the certificate of authentication on this
Note.
21. Governing Law. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE PARTIES TO THE INDENTURE HAS AGREED 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 NOTE.
22. Abbreviations and Defined Terms. Customary abbreviations may be
used in the name of a Holder of a Note or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
23. CUSIP, ISIN and Common Code Numbers. The Company has caused
CUSIP, ISIN and Common Code numbers to be printed on the Notes as a convenience
to the Holders. No representation is made as to the accuracy of such numbers as
printed on the Notes and reliance may be placed only on the other identification
numbers printed hereon.
24. Indenture. Each Holder, by accepting a Note, agrees to be bound
by all of the terms and provisions of the Indenture, as the same may be amended
from time to time.
The Company will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture, which has the text of this Note in
larger type. Requests may be made to: IFCO Systems N.V. "Rivierstaete,"
Amsteldijk 166, 1079 LH, Amsterdam, The Netherlands, Attention: Chief Financial
Officer or to IFCO Systems N.V., c/o PalEx, Inc., 6829 Flintlock Road, Houston,
Texas 77040, Attention: Chief Financial Officer.
B-2-7
FORM OF GUARANTEE
SENIOR SUBORDINATED GUARANTEE
Each Guarantor (capitalized terms used herein have the meanings given
such terms in the Indenture referred to in the Note upon which this notation is
endorsed) hereby unconditionally guarantees on a senior subordinated basis (such
guarantee being referred to herein as the "Guarantee") the due and punctual
payment of the principal of, premium, if any, and interest on the Notes and all
other amounts payable by the Company, whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on the overdue principal,
premium and interest on the Notes, and the due and punctual performance of all
other obligations of the Company to the Holders or the Trustee, all in
accordance with the terms set forth in Article 10 of the Indenture.
The obligations of each Guarantor to the Holders and to the Trustee
pursuant to the Guarantee and the Indenture are expressly set forth, and are
expressly subordinated and subject in right of payment to the prior payment in
full of all Senior Debt of each Guarantor, to the extent and in the manner
provided in Article 11 of the Indenture.
This Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Notes upon which this Guarantee is
noted shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
This Guarantee shall be governed by and construed in accordance with
the laws of the State of New York without regard to principles of conflicts of
law.
This Guarantee is subject to release upon the terms set forth in
Section 10.06 of the Indenture.
IFCO EUROPE BETEILIGUNGS GMBH
By:
--------------------------------------
Name:
Title:
IFCO INTERNATIONAL FOOD CONTAINER ORGANISATION
GMBH
By:
--------------------------------------
Name:
Title:
B-2-8
IFCO FINANCE CONSULTING GMBH
By:
--------------------------------------
Name:
Title:
IFCO SKANDINAVIEN A/S
By:
--------------------------------------
Name:
Title:
GISO VERWALTUNGSGESELLSCHAFT MBH & CO.
BEHALTERLEASING KG
By:
--------------------------------------
Name:
Title:
IFCO ARGENTINA S.A.
By:
--------------------------------------
Name:
Title:
PALEX, INC.
By:
--------------------------------------
Name:
Title:
ACME BARREL COMPANY, INC.
By:
--------------------------------------
Name:
Title:
B-2-9
BAY AREA PALLET COMPANY
By:
--------------------------------------
Name:
Title:
BLACK RIVER FOREST PRODUCTS, INC.
By:
--------------------------------------
Name:
Title:
CHARLOTTE STEEL DRUM CORPORATION
By:
--------------------------------------
Name:
Title:
CONSOLIDATED CONTAINER CORPORATION
By:
--------------------------------------
Name:
Title:
CONTAINER RESOURCES CORPORATION
By:
--------------------------------------
Name:
Title:
CONTAINER SERVICES COMPANY NW, INC.
(F/K/A CONTAINER SERVICES COMPANY NW ACQUISITION,
INC.)
By:
--------------------------------------
Name:
Title:
B-2-10
CONTAINER SERVICES COMPANY SW, INC.
(F/K/A CONTAINER SERVICES COMPANY SW ACQUISITION,
INC.)
By:
--------------------------------------
Name:
Title:
DUCKERT PALLET CO., INC.
By:
--------------------------------------
Name:
Title:
DRUM SERVICE CO. OF FLORIDA
By:
--------------------------------------
Name:
Title:
ENVIRONMENTAL RECYCLERS OF COLORADO, INC.
By:
--------------------------------------
Name:
Title:
GILBERT LUMBER INCORPORATED
By:
--------------------------------------
Name:
Title:
ISAACSON LUMBER COMPANY
By:
--------------------------------------
Name:
Title:
B-2-11
INTERSTATE PALLET CO., INC.
By:
--------------------------------------
Name:
Title:
NEW LONDON PALLET, INC.
By:
--------------------------------------
Name:
Title:
PALEX CONTAINER SYSTEMS, INC.
By:
--------------------------------------
Name:
Title:
PALEX-TEXAS, INC.
By:
--------------------------------------
Name:
Title:
PALEX-TEXAS, L.P.
By:
--------------------------------------
Name:
Title:
PALEX TEXAS HOLDINGS, INC.
By:
--------------------------------------
Name:
Title:
B-2-12
PALLET OUTLET COMPANY, INC.
By:
--------------------------------------
Name:
Title:
RIDGE PALLETS, INC.
By:
--------------------------------------
Name:
Title:
SHEFFIELD LUMBER AND PALLET COMPANY, INC.
By:
--------------------------------------
Name:
Title:
SHIPSHEWANA PALLET CO., INC.
By:
--------------------------------------
Name:
Title:
SMG CORPORATION
By:
--------------------------------------
Name:
Title:
SONOMA PACIFIC COMPANY
By:
--------------------------------------
Name:
Title:
B-2-13
SOUTHERN PALLET, INC.
By:
--------------------------------------
Name:
Title:
VALLEY CRATING AND PACKAGING, INC.
By:
--------------------------------------
Name:
Title:
WESTERN CONTAINER LIMITED LIABILITY COMPANY
By:
--------------------------------------
Name:
Title:
B-2-14
ASSIGNMENT FORM
If you the Holder want to assign this Note, fill in the form below and
have your signature guaranteed:
I or we assign and transfer this Note to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint ,
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Date: Signed:
---------------------------------- ------------------------------
(Sign exactly as your name
appears on the other side of
this Note)
Medallion Guarantee:
--------------------------------
B-2-15
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Note purchased by the Company
pursuant to Section 4.13 or Section 4.17 of the Indenture, check the appropriate
box:
Section 4.13 [ ]
Section 4.17 [ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 4.13 or Section 4.17 of the Indenture, state the
amount you elect to have purchased:
(EURO)
--------------------------
Date:
-------------------------------- --------------------------------------
NOTICE: The signature on this
assignment must correspond with the
name as it appears upon the face of the
within Note in every particular without
alteration or enlargement or any change
whatsoever and be guaranteed by the
endorser's bank or broker.
Medallion Guarantee:
-------------------------------
B-2-16
EXHIBIT C
Form of Transfer Certificate
for Transfer from Rule 144A Global
Note to Regulation S Global Note
______________, ____
THE BANK OF NEW YORK
101 Barclay Street, Floor 21W
New York, New York 10286
Re: IFCO Systems N.V.
10 5/8% Senior Subordinated Notes Due 2010 (the "Notes")
--------------------------------------------------------
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of March 8, 2000
(the "Indenture) among IFCO Systems N.V. (the "Company"), as Issuer, the
Guarantors named therein and The Bank of New York, as Trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to (EURO) [ ] aggregate principal amount of
Notes which are evidenced by a Rule 144A Global Note (CUSIP No. ) and held
with the Common Depository through Euroclear or Clearstream or both (Common
Code ) in the name of [insert name of transferor] (the "Transferor"). The
Transferor has requested a transfer of such beneficial interest in the Rule 144A
Global Note to a person who will take delivery thereof in the form of an equal
aggregate principal amount of Notes evidenced by a Regulation S Global Note of
the same series and of like tenor as the Notes (CUSIP No. ).
In connection with such request and in respect of such Notes, the
Transferor does hereby certify that such transfer has been effected pursuant to
and in accordance with Rule 903 or Rule 904 under the United States Securities
Act of 1933, as amended (the "Securities Act"), and accordingly the Transferor
does hereby further certify that:
(1) the offer of the Notes was not made to a person in the United States;
(2) either (a) at the time the buy order was originated, the transferee
was outside the United States or the Transferor and any person acting
on its behalf reasonably believed that the transferee was outside the
United States or (b) the transaction was executed in, on or through
the facilities of a Designated Offshore Securities Market and neither
the Transferor nor any person acting on its behalf knows that the
transaction was prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or Rule 904(b) of Regulation S, as
applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
C-1
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchaser. Terms used in
this certificate and not otherwise defined herein or in the Indenture have the
meanings set forth in Regulation S under the Securities Act.
[Insert Name of Transferor]
By:
--------------------------------
Name:
Title:
Dated: ________________, _____
C-2
Exhibit D
Form of Transfer Certificate
for Transfer from Regulation S Global
Note to Rule 144A Global Note
______________, ____
THE BANK OF NEW YORK
101 Barclay Street, Floor 21W
New York, New York 10286
Re: 10 5/8% Senior Subordinated Notes Due 2010 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of March 8, 2000
(the "Indenture) among IFCO Systems N. V. (the "Company"), as Issuer, the
Guarantors named therein and The Bank of New York, as Trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to (EURO)[ ] aggregate principal amount of
Notes which are evidenced by a Regulation S Global Note (CUSIP No. ) and
held with the Common Depository through Euroclear or Clearstream or both (Common
Code ) in the name of [insert name of transferor] (the "Transferor"). The
Transferor has requested a transfer of such beneficial interest in the
Regulation S Global Note to a person who will take delivery thereof in the form
of an equal aggregate principal amount of Notes evidenced by a Rule 144A Global
Note of the same series and of like tenor as the Notes (CUSIP No. ). The
Transferor has informed such person that he is obtaining an interest in a Note
that is subject to restrictions on transfer and that each subsequent transferee
should be so informed.
In connection with such request and in respect of such Notes, the
Transferor does hereby certify that such transfer has been effected pursuant to
and in accordance with Rule 144A under the United States Securities Act of 1933,
as amended (the "Securities Act"), and accordingly the Transferor does hereby
further certify that the Notes are being transferred to a person that the
Transferor reasonably believes is purchasing the Notes for its own account, or
for one or more accounts with respect to which such person exercises sole
investment discretion, and such person and each such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act,
in each case in a transaction meeting the requirements of Rule 144A and in
accordance with any applicable securities laws of any state of the United
States.
The Transferor further certifies that it is not an "affiliate" of the
Company within the meaning of the Securities Act.
D-1
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
[Insert Name of Transferor]
By:
--------------------------------
Name:
Title:
Dated: ________________, ___
D-2
EXHIBIT E
Form of Investor Letter To Be
Delivered in Connection with Transfers
to Non-QIB Institutional Accredited Investors
_________, ____
IFCO SYSTEMS N.V.
"Riverstaete", Amsteldivk 166
1079 LH
The Netherlands
THE BANK OF NEW YORK
101 Barclay Street, Floor 21W
New York, New York 10286
Ladies and Gentlemen:
In connection with our proposed purchase of (EURO)[ ]
aggregate principal amount of 10 5/8% Senior Subordinated Notes due 2010 (the
"Senior Subordinated Notes") of IFCO SYSTEMS N.V. (the "Company"), we confirm
that:
1. We understand that the Senior Subordinated Notes have not been
registered under the United States Securities Act of 1933, as amended (the
"Securities Act"), and, unless so registered, may not be sold except as
permitted in the following sentence. We agree on our own behalf and on
behalf of any investor account for which we are purchasing Senior
Subordinated Notes to offer, sell or otherwise transfer such Senior
Subordinated Notes prior to (i) the date which is two years after the later
of the date of original issue and the last date on which the Company or any
affiliate of the Company was the owner of such Senior Subordinated Notes
(or any predecessor thereto) and (ii) such later date, if any, as may be
required by any subsequent change in applicable law (the "Resale
Restriction Termination Date") only (a) to the Company, (b) pursuant to a
registration statement which has been declared effective under the
Securities Act, (c) so long as the Senior Subordinated Notes are eligible
for resale pursuant to Rule 144A under the Securities Act, to a person we
reasonably believe is a qualified institutional buyer under Rule 144A (a
"QIB") that purchases for its own account or for the account of a QIB and
to whom notice is given that the transfer is being made in reliance on Rule
144A (as indicated by the box checked by the transferor on the Certificate
of Transfer on the reverse of the Senior Subordinated Notes), (d) in an
offshore transaction complying with Rule 903 or Rule 904 of Regulation S
under the Securities Act, (e) to an institutional "accredited investor"
within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501
under the Securities Act that is purchasing at least (Euro)250,000 of
Senior Subordinated Notes that is purchasing for his or her own account or
for the account of such an institutional accredited investor after delivery
of an investor letter duly executed by such transferee or (f) pursuant to
any other available exemption from the registration requirements of the
Securities Act, subject in each of the foregoing cases to any requirement
of law that the disposition of our property or the property of such
investor account or accounts be at all times within our or their control
and to compliance with any applicable state securities laws. The foregoing
restrictions on resale will not apply subsequent to the Resale Restriction
Termination Date. Each purchaser acknowledges that the Company and the
Trustee reserve the right prior to any offer, sale or other transfer prior
to the Resale Restriction Termination Date of the Senior Subordinated Notes
pursuant to clauses (d), (e) or (f) above to
E-1
require the delivery of an opinion of counsel, certification and/or other
information satisfactory to the Company and the Trustee.
2. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) that is purchasing at
least (Euro)250,000 of Senior Subordinated Notes, purchasing for our own
account or for the account of such an institutional accredited investor
that is purchasing at least (Euro)250,000 of Senior Subordinated Notes, and
we are acquiring the Senior Subordinated Notes for investment purposes and
not with a view to, or for offer or sale in connection with, any
distribution in violation of the Securities Act and we have such knowledge
and experience in financial and business matters as to be capable of
evaluating the merits and risks of our investment in the Senior Notes, and
we and any accounts for which we are acting are each able to bear the
economic risk of our or its investment for an indefinite period.
3. We are acquiring the Senior Subordinated Notes purchased by us for
our own account or for one or more accounts as to each of which we exercise
sole investment discretion.
4. You are entitled to rely upon this letter and you are irrevocably
authorized to produce this letter or a copy hereof to any interested party
in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
(Name of Purchaser)
By:
--------------------------------
Name:
Title:
Upon transfer, the Senior Subordinated Notes would be registered in
the name of the new beneficial owner as follows:
Name:
--------------------------------
Address:
--------------------------------
Taxpayer ID Number:
-------------------
E-2
EXHIBIT F
Form of Transfer Certificate For
Transfer or Exchange of Restricted
Security (Other than Rule 144A Global Note)
THE BANK OF NEW YORK
101 Barclay Street, Floor 21W
New York, New York 10286
Re: IFCO Systems N.V.
10 5/8% Senior Subordinated Notes Due 2010 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of March 8, 2000
(the "Indenture) among IFCO Systems N.V. (the "Company"), as Issuer, the
Guarantors named therein and The Bank of New York, as Trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to (EURO)[ ] principal amount at of Notes
presented or surrendered on the date hereof (the "Surrendered Notes") which are
registered in the name of [Insert Name of Transferor] (the "Transferor"). The
Transferor has requested a transfer of such Surrendered Notes to a Person other
than the Transferor (each such transaction being referred to herein as a
"transfer").
In connection with such request and in respect of such Surrendered
Notes, the Transferor does hereby certify that:
[CHECK ONE]
[ ] (a) the Surrendered Notes are being transferred to the Company;
or
[ ] (b) such transfer has been effected pursuant to and in accordance with Rule
144A under the United States Securities Act of 1933, as amended (the
"Securities Act"), and accordingly the Transferor does hereby further
certify that the Surrendered Notes are being transferred to a person
that the Transferor reasonably believes is purchasing the Surrendered
Notes for its own account, or for one or more accounts with respect to
which such person exercises sole investment discretion, and such person
and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A under the Securities Act, in each case in a
transaction meeting the requirements of Rule 144A and in accordance
with any applicable securities laws of any state of the United States;
or
[ ] (c) the Surrendered Notes are being transferred pursuant to and in
accordance with Rule 904 of Regulation S under the Securities Act, and
F-1
(1) the offer of the Surrendered Notes was not made to a person in
the United States;
(2) either: (a) at the time the buy order was originated, the
transferee was outside the United States or the Transferor and
any person acting on its behalf reasonably believed and believes
that the transferee was outside the United States or (b) the
transaction was executed in, on or through the facilities of the
Designated Offshore Securities Market and neither the Transferor
nor any person acting on its behalf knows that the transaction
was prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in contravention of
the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
or
[ ] (d) the Surrendered Notes are being transferred in a transaction permitted
by Rule 144 under the Securities Act and in accordance with any
applicable securities laws of any state of the United States;
or
[ ] (e) the Surrendered Notes are being transferred to an Institutional
Accredited Investor and a form of Investor Letter, as specified in
Exhibit E to the Indenture, duly executed, is attached hereto.
F-2
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchaser of the Notes
being transferred. Terms used in this certificate and not otherwise defined in
the Indenture have the meanings set forth in Regulation S under the Securities
Act.
[Insert Name of Transferor]
By:
------------------------------------
Name:
Title:
Date _______________, _____
F-3
EXHIBIT G
Form of Transfer Certificate
for Transfer from Regulation S Global
Note or Rule 144A Global Note
to an Accredited Institutional Investor
______________, ____
THE BANK OF NEW YORK
101 Barclay Street, Floor 21W
New York, New York 10286
Re: IFCO Systems N.V.
10 5/8% Senior Subordinated Notes Due 2010 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of March 8, 2000
(the "Indenture) among IFCO Systems N.V. (the "Company"), as Issuer, the
Guarantors named therein and The Bank of New York, as Trustee. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to (EURO)[ ] aggregate principal amount of
Notes which are evidenced by [a Regulation S Global Note (CUSIP No. )
and held with the Common Depository through Euroclear or Clearstream or both
(Common Code ) [a Rule 144A Global Note (CUSIP No. )
and held with the Common Depository through Euroclear or Clearstream or both
(Common Code )] in the name of [insert name of transferor] (the
"Transferor"). The Transferor has requested a transfer of such beneficial
interest in the [Regulation S Global Note] [Rule 144A Global Note] to an
Institutional Accredited Investor as defined in the Indenture who will take
delivery thereof in the form of an equal aggregate principal amount of Physical
Notes that are Restricted Securities of the same series and of like tenor as the
Notes (CUSIP No. ).
In connection with such transfer, attached hereto is an Investor
Letter, substantially in the form of Exhibit E to the Indenture, duly executed
by the transferee.
G-1
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchasers.
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
G-2
EXHIBIT H
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
, among (the "New Guarantor"), a
subsidiary of IFCO Systems N.V., Inc. (or its successor), a limited liability
company incorporated in the Netherlands (the "Company"), the Guarantors (the
"Existing Guarantors") under the Indenture referred to below, and The Bank of
New York, as trustee under the Indenture referred to below (the "Trustee").
W I T N E S S E T H :
WHEREAS the Company has heretofore executed and delivered to the
Trustee an Indenture (as such may be amended from time to time, the
"Indenture"), dated as of March 8, 2000, providing for the issuance of its 10
5/8% Senior Subordinated Notes due 2010 (the "Notes");
WHEREAS Section 4.20 of the Indenture provides that under certain
circumstances the Company is required to cause the New Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the New
Guarantor shall unconditionally guarantee all of the Company's obligations under
the Notes pursuant to a Guarantee on the terms and conditions set forth in the
Indenture; and
WHEREAS pursuant to Section 8.01 of the Indenture, the Trustee, the
Company and Existing Guarantors are authorized to execute and deliver this
Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the New
Guarantor, the Company, the Existing Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the Noteholders as
follows:
1. Definitions. (a) Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
(b) For all purposes of this Supplemental Indenture, except as
otherwise herein expressly provided or unless the context otherwise requires:
(i) the terms and expressions used herein shall have the same meanings as
corresponding terms and expressions used in the Indenture; and (ii) the words
"herein," "hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
2. Agreement to Guarantee. The New Guarantor hereby agrees, jointly
and severally with all other Guarantors, to Guarantee the Company's Obligations
under the Notes on the terms and subject to the conditions set forth in Article
10 of the Indenture and to be bound by all other applicable provisions of the
Indenture. From and after the date hereof, the New Guarantor shall be a
Guarantor for all purposes under the Indenture and the Notes.
3. Ratification of Indenture; Supplemental Indentures Part of
Indenture. Except as expressly amended hereby, the Indenture is in all respects
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every Noteholder heretofore or
hereafter authenticated and delivered shall be bound hereby.
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4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED
TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO
THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE.
5. Trustee Makes No Representation. The Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Supplemental Indenture or for or in respect of the recitals
contained herein, all of which are made solely by the Company.
6. Multiple Counterparts. The parties may sign multiple counterparts
of this Supplemental Indenture. Each signed counterpart shall be deemed an
original, but all of them together represent one and the same agreement.
7. Headings. The headings of this Supplemental Indenture have been
inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date and year first above written.
[NEW GUARANTOR]
By:
-------------------------------
Name:
Title:
IFCO SYSTEMS N.V.
By:
-------------------------------
Name:
Title:
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[EXISTING GUARANTORS]
By:
-------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By:
-------------------------------
Name:
Title:
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