EXHIBIT 4.2
LYONDELL CHEMICAL COMPANY,
the SUBSIDIARY GUARANTORS party hereto
and
THE BANK OF NEW YORK,
as Trustee
______________
INDENTURE
Dated as of December 4, 2001
______________
9 1/2% Senior Secured Notes Due 2008
TABLE OF CONTENTS
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ARTICLE 1
Definitions and Other Provisions of General Application.
Section 1.01. Definitions........................................................................ 1
Section 1.02. Other Definitions.................................................................. 29
Section 1.03. Rules of Construction.............................................................. 30
Section 1.04. Incorporation by Reference of TIA.................................................. 30
Section 1.05. Conflict with TIA.................................................................. 31
Section 1.06. Compliance Certificates and Opinions............................................... 31
Section 1.07. Form of Documents Delivered to Trustee............................................. 32
Section 1.08. Acts of Noteholders; Record Dates.................................................. 32
Section 1.09. Notices, Etc., to Trustee and Company.............................................. 34
Section 1.10. Notices to Holders; Waivers........................................................ 34
Section 1.11. Effect of Headings and Table of Contents........................................... 35
Section 1.12. Successors and Assigns............................................................. 35
Section 1.13. Separability Clause................................................................ 35
Section 1.14. Benefits of Indenture.............................................................. 35
Section 1.15. Governing Law...................................................................... 35
Section 1.16. Legal Holidays..................................................................... 36
Section 1.17. No Personal Liability of Directors, Officers, Employees, Incorporators and
Stockholders.............................................................................. 36
Section 1.18. Exhibits and Schedules............................................................. 36
Section 1.19. Counterparts....................................................................... 36
ARTICLE 2
Note Forms
Section 2.01. Forms Generally.................................................................... 36
Section 2.02. Form of Trustee' Certificate of Authentication..................................... 38
Section 2.03. Restrictive Legends................................................................ 38
ARTICLE 3
The Notes
Section 3.01. Title and Terms.................................................................... 41
Section 3.02. Denominations...................................................................... 42
Section 3.03. Execution, Authentication and Delivery and Dating.................................. 42
Section 3.04. Temporary Notes.................................................................... 43
Section 3.05. Registration, Registration of Transfer and Exchange................................ 43
Section 3.06. Mutilated, Destroyed, Lost and Stolen Notes........................................ 44
Section 3.07. Payment of Interest Rights Preserved............................................... 45
Section 3.08. Persons Deemed Owners.............................................................. 46
Section 3.09. Cancellation....................................................................... 46
Section 3.10. Computation of Interest............................................................ 46
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Section 3.11. Payment of Liquidated Damages....................................................... 46
Section 3.12. CUSIP Numbers....................................................................... 46
Section 3.13. Book-entry Provisions for Global Notes.............................................. 47
Section 3.14. Transfer Provisions................................................................. 48
ARTICLE 4
Covenants
Section 4.01. Payment of Principal, Premium and Interest.......................................... 54
Section 4.02. Maintenance of Office or Agency..................................................... 54
Section 4.03. Money for Payments to Be Held in Trust.............................................. 54
Section 4.04. SEC Reports......................................................................... 56
Section 4.05. Certificates to Trustee............................................................. 56
Section 4.06. Limitation on Indebtedness.......................................................... 57
Section 4.07. Limitation on Restricted Payments................................................... 61
Section 4.08. Limitation on Dividend and other Payment Restrictions Affecting Restricted
Subsidiaries and Joint Ventures.............................................................. 67
Section 4.09. Limitation on Sales of Assets....................................................... 70
Section 4.10. Limitation on Affiliate Transactions................................................ 72
Section 4.11. Limitation on Liens................................................................. 73
Section 4.12. Equal and Ratable Liens............................................................. 73
Section 4.13. No Amendment to Subordination Provisions............................................ 74
Section 4.14. Repurchase of Notes upon a Change in Control........................................ 74
Section 4.15. Limitation on Sale and Leaseback Transactions....................................... 75
Section 4.16. Limitation on Line of Business...................................................... 75
Section 4.17. Limitation on Accounts Receivable Facilities........................................ 75
Section 4.18. Limited Applicability of Covenants when Notes are Rated Investment-Grade............ 75
Section 4.19. Existence........................................................................... 75
Section 4.20. Payment of Taxes and Other Claims................................................... 76
Section 4.21. Maintenance of Properties and Insurance............................................. 76
Section 4.22. Limitation on Issuance of Guarantees by Restricted Subsidiaries..................... 76
Section 4.23. Payments for Consents............................................................... 77
ARTICLE 5
Consolidation, Merger or Sale of Assets
Section 5.01. Consolidation, Merger or Sale of Assets by the Company.............................. 77
Section 5.02. Successor Company Substituted....................................................... 78
Section 5.03. Consolidation, Merger or Sale of Assets by a Subsidiary Guarantor................... 79
Section 5.04. Opinion of Counsel to Trustee....................................................... 80
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ARTICLE 6
Remedies
Section 6.01. Events of Default................................................................... 80
Section 6.02. Acceleration........................................................................ 81
Section 6.03. Other Remedies...................................................................... 82
Section 6.04. Waiver of Past Defaults............................................................. 82
Section 6.05. Control by Majority................................................................. 82
Section 6.06. Limitation on Suits................................................................. 83
Section 6.07. Rights of Holders to Receive Payment................................................ 83
Section 6.08. Collection Suit by Trustee.......................................................... 83
Section 6.09. Trustee May File Proofs of Claim.................................................... 83
Section 6.10. Priorities.......................................................................... 84
Section 6.11. Undertaking for Costs............................................................... 84
Section 6.12. Restoration of Rights and Remedies.................................................. 84
Section 6.13. Rights and Remedies Cumulative...................................................... 85
Section 6.14. Waiver of Stay, Extension or Usury Laws............................................. 85
ARTICLE 7
The Trustee
Section 7.01. Certain Duties and Responsibilities................................................. 85
Section 7.02. Notice of Defaults.................................................................. 86
Section 7.03. Certain Rights of Trustee........................................................... 86
Section 7.04. Not Responsible for Recitals or Issuance of Notes................................... 87
Section 7.05. Trustee's Disclaimer................................................................ 88
Section 7.06. May Hold Notes...................................................................... 88
Section 7.07. Money Held in Trust................................................................. 88
Section 7.08. Compensation and Reimbursement...................................................... 88
Section 7.09. Conflicting Interests............................................................... 89
Section 7.10. Corporate Trustee Required; Eligibility............................................. 89
Section 7.11. Resignation and Removal; Appointment of Successor................................... 89
Section 7.12. Acceptance of Appointment by Successor.............................................. 90
Section 7.13. Merger, Conversion, Consolidation or Succession to Business......................... 91
Section 7.14. Preferential Collection of Claims Against the Company............................... 91
Section 7.15. Appointment of Authenticating Agent................................................. 91
ARTICLE 8
Holders' List and Reports by Trustee and the Company
Section 8.01. The Company to Furnish Trustee Names and Addresses of Holders; Stock
Exchange Listing.......................................................................... 92
Section 8.02. Preservation of Information; Communications to Holders.............................. 92
Section 8.03. Reports by Trustee.................................................................. 92
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ARTICLE 9
Amendment, Supplement or Waiver
Section 9.01. Without Consent of the Holders...................................................... 93
Section 9.02. With Consent of Holders............................................................. 93
Section 9.03. Execution of Amendments, Supplements or Waivers..................................... 95
Section 9.04. Revocation and Effect of Consents................................................... 95
Section 9.05. Conformity with TIA................................................................. 96
Section 9.06. Notation on or Exchange of Notes.................................................... 96
ARTICLE 10
Redemption of Notes
Section 10.01. Right of Redemption................................................................ 96
Section 10.02. Applicability of Article........................................................... 96
Section 10.03. Election to Redeem; Notice to Trustee.............................................. 96
Section 10.04. Selection by Trustee of Notes to Be Redeemed....................................... 97
Section 10.05. Notice of Redemption............................................................... 97
Section 10.06. Deposit of Redemption Price........................................................ 98
Section 10.07. Notes Payable on Redemption Date................................................... 98
Section 10.08. Notes Redeemed in Part............................................................. 99
ARTICLE 11
Satisfaction and Discharge
Section 11.01. Satisfaction and Discharges of Indenture........................................... 99
Section 11.02. Application of Trust Money......................................................... 100
ARTICLE 12
Defeasance and Covenant Defeasance
Section 12.01. Option of the Company to Effect Defeasance or Covenant Defeasance.................. 100
Section 12.02. Legal Defeasance and Discharge..................................................... 101
Section 12.03. Covenant Defeasance................................................................ 101
Section 12.04. Conditions to Legal or Covenant Defeasance......................................... 102
Section 12.05. Deposited Money and Government Securities to Be Held in Trust; Other
Miscellaneous Provisions.................................................................... 103
Section 12.06. Repayment to Company............................................................... 104
Section 12.07. Reinstatement...................................................................... 104
ARTICLE 13
Subsidiary Guarantees
Section 13.01. The Guarantees..................................................................... 104
Section 13.02. Guarantee Unconditional............................................................ 105
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Section 13.03. Discharge; Reinstatement............................................................. 105
Section 13.04. Waiver by the Subsidiary Guarantors.................................................. 106
Section 13.05. Subrogation and Contribution......................................................... 106
Section 13.06. Stay of Acceleration................................................................. 106
Section 13.07. Limits of Guarantees................................................................. 106
Section 13.08. Execution and Delivery of Note Guarantee............................................. 106
ARTICLE 14
Security Arrangements
Section 14.01. Security............................................................................. 107
Section 14.02. Notice of Payment, Discharge or Defeasance........................................... 108
EXHIBIT A - Form of Note
EXHIBIT B - Form of Supplemental Indenture
EXHIBIT C - Form of Certificate of Beneficial Ownership
EXHIBIT D - Form of Regulation S Certificate
EXHIBIT E - Form of Institutional Accredited Investor Certificate
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INDENTURE, dated as of December 4, 2001 (as amended, supplemented or
otherwise modified from time to time, the "Indenture"), among LYONDELL CHEMICAL
COMPANY, a Delaware corporation (as further defined below, the "Company"), the
Subsidiary Guarantors party hereto and THE BANK OF NEW YORK, a New York banking
corporation, as trustee (the "Trustee").
RECITALS OF THE COMPANY
The Company and the Subsidiary Guarantors have duly authorized the
execution and delivery of this Indenture to provide for the issuance of (i)
initially, $393,000,000 aggregate principal amount of 9 1/2% Senior Secured
Notes due 2008 of the Company (the "Initial Notes" and, together with any
Exchange Notes issued in respect thereof, the "Original Notes") and (ii) if and
when issued, additional 9 1/2% Senior Secured Notes due 2008 of the Company (the
"Initial Additional Notes" and, together with any Exchange Notes issued in
respect thereof, the "Additional Notes") issuable as provided in this Indenture,
in each case, guaranteed to the extent provided herein and in the Notes by the
Subsidiary Guarantors. All things necessary to make the Original Notes, when
duly issued, executed and delivered by the Company and authenticated and
delivered by the Trustee hereunder, the valid obligation of the Company, and to
make this Indenture a valid agreement of the Company and the Subsidiary
Guarantors as of the date hereof, in accordance with the terms of the Original
Notes and this Indenture, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes
(as defined herein) by the Holders (as defined herein) thereof, it is mutually
agreed, for the equal and ratable benefit of all Holders, as follows:
ARTICLE 1
Definitions and Other Provisions of General Application
Section 1.01 Definitions.
"Accounts Receivable Subsidiary" means any Wholly Owned Subsidiary of
the Company (i) which is formed solely for the purpose of, and which engages in
no activities other than activities in connection with, financing accounts
receivable of the Company and/or its Restricted Subsidiaries, (ii) which is
designated by the Company as an Accounts Receivables Subsidiary pursuant to an
Officer's Certificate delivered to the Trustee, (iii) no portion of Indebtedness
or any other obligation (contingent or otherwise) of which (a) is at any time
recourse to or obligates the Company or any Restricted Subsidiary in any way, or
subjects any property or asset of the Company or any Restricted Subsidiary,
directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than pursuant to (I) representations, warranties and covenants (or any
indemnity with respect to such representations, warranties and covenants)
entered into in the ordinary course of business in connection with the sale
(including a sale in exchange for a promissory note of or Equity Interest in
such Accounts Receivable Subsidiary) of
accounts receivable to such Accounts Receivable Subsidiary or (II) any guarantee
of any such accounts receivable financing by the Company or any Restricted
Subsidiary that is permitted to be incurred pursuant to Section 4.06, (iv) with
which neither the Company nor any Restricted Subsidiary of the Company has any
contract, agreement, arrangement or understanding other than contracts,
agreements, arrangements and understandings entered into in the ordinary course
of business in connection with the sale (including a sale in exchange for a
promissory note of or Equity Interest in such Accounts Receivable Subsidiary) of
accounts receivable in accordance with Section 4.17 and fees payable in the
ordinary course of business in connection with servicing accounts receivable and
(v) with respect to which neither the Company nor any Restricted Subsidiary of
the Company has any obligation (a) to subscribe for additional shares of Capital
Stock or other Equity Interests therein or make any additional capital
contribution or similar payment or transfer thereto other than in connection
with the sale (including a sale in exchange for a promissory note of or Equity
Interest in such Accounts Receivable Subsidiary) of accounts receivable to such
Accounts Receivable Subsidiary in accordance with Section 4.17 or (b) to
maintain or preserve the solvency, any balance sheet term, financial condition,
level of income or results of operations thereof.
"Acquired Debt" means, with respect to any specified Person, (i)
Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person and (ii) Indebtedness secured by a Lien
encumbering any asset acquired by such specified Person.
"Acquired Disqualified Stock" means, with respect to any specified
Person, Disqualified Stock of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified Person,
including, without limitation, Disqualified Stock incurred in connection with,
or in contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person.
"Acquired Preferred Stock" means, with respect to any specified Person,
Preferred Stock of any other Person existing at the time such other Person is
merged with or into or became a Subsidiary of such specified Person, including,
without limitation, Preferred Stock incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Subsidiary of such specified Person.
"Acquiring Person" means a Person other than a Subject Assets
Transferee which acquires (i) all or a portion of the Subject Assets or (ii) an
interest in a Subject Assets Transferee in connection with a Major Asset Sale.
"Additional Notes" means any notes issued under this Indenture in
addition to the Original Notes, including any Exchange Notes issued in exchange
therefor having the same terms in all respects (or in all respects except
payment of interest (i) scheduled and paid prior to the date of issuance of such
notes or (ii) payable on the first Interest Payment Date following such date of
issuance).
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"Adjusted Consolidated Cash Flow" means, for any period, the sum of
Consolidated Cash Flow of the Company for such period plus the aggregate
Distributable Joint Venture Cash Flow of the Company and its Restricted
Subsidiaries, determined on a consolidated basis, for such period.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For 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, shall mean
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
beneficial ownership of 10% or more of the voting securities of a Person shall
be deemed to be control; provided further that the foregoing proviso shall not
apply for purposes of Section 4.07(b)(vii) and Section 4.07(b)(ix) and clause
(d) of the definition of "Unrestricted Subsidiary".
"Asset Sale" means (i) the sale, lease, conveyance or other disposition
(other than the creation of a Lien) of any assets other than the disposition of
inventory, equipment or Cash Equivalents in the ordinary course of business
consistent with past practices (provided that the sale, conveyance or other
disposition of all or substantially all the assets of the Company and its
Restricted Subsidiaries taken as a whole will be governed by the provisions of
Section 4.14 and/or the provisions of Section 5.01 and not by the provisions of
Section 4.09), (ii) the sale by the Company or any of its Restricted
Subsidiaries of Equity Interests of any of the Company's Restricted
Subsidiaries, Unrestricted Subsidiaries or Joint Ventures and (iii) the issuance
by any of the Company's Restricted Subsidiaries of Equity Interests of such
Restricted Subsidiary, in the case of clause (i), (ii) or (iii), whether in a
single transaction or a series of related transactions (a) that have a fair
market value in excess of $25 million or (b) for Net Proceeds in excess of $25
million. Notwithstanding the foregoing: (a) a transfer of assets by the Company
to a Restricted Subsidiary or by a Restricted Subsidiary to the Company or to
another Restricted Subsidiary; (b) an issuance of Equity Interests by a
Restricted Subsidiary to the Company or to another Restricted Subsidiary; (c) a
Restricted Payment that is permitted by Section 4.07; (d) an issuance of
Preferred Stock by a Finance Subsidiary that is permitted by Section 4.06; (e)
sales (including a sale in exchange for a promissory note of or Equity Interest
in such Accounts Receivable Subsidiary) of accounts receivable to an Accounts
Receivable Subsidiary in connection with any Receivables Facility permitted by
Section 4.17; and (f) Sale and Leaseback Transactions will not be deemed to be
an Asset Sale.
"Asset Sale Lien" means a Lien on the Subject Assets (including as a
Lien for this purpose contractual rights with respect to the operation of the
Subject Assets) arising in connection with a Major Asset Sale in favor of the
Acquiring Person (or an Affiliate thereof) which Lien does not secure any
Indebtedness.
"Attributable Debt" in respect of a Sale and Leaseback Transaction that
is treated as a capital lease in accordance with GAAP means, at the time of
determination, the present value (discounted at the rate of interest implicit in
such transaction,
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determined in accordance with GAAP) of the obligation of the lessee for net
rental payments during the remaining term of the lease included in such Sale and
Leaseback Transaction (including any period for which such lease has been
extended or may, at the option of the lessor, be extended).
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 7.15 to act on behalf of the Trustee to authenticate Notes
of one or more series.
"Board of Directors" means the board of directors of the Company or any
committee thereof duly authorized to act on behalf of such board of directors.
"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 (or any committee thereof)
of such Person and to be in full force and effect on the date of such
certification, and delivered to the Trustee. Unless the context otherwise
requires, "Board Resolution" refers to a Board Resolution of the Company.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in The City of New York or Houston, Texas are authorized
by law to close.
"Capital Lease Obligation" means, at the time any determination thereof
is to be made, the amount of the liability in respect of a capital lease that
would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or a business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership, partnership
interests (whether general or limited) and (iv) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"Cash Equivalents" means (a) United States dollars, (b) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof (provided that the full
faith and credit of the United States is pledged in support thereof) having
maturities of not more than one year from the date of acquisition, (c) demand
deposits, time deposits and certificates of deposit with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year from the date of acquisition and overnight bank deposits, in
each case with any bank or trust company organized or licensed under the laws of
the United States or any State thereof having capital, surplus and undivided
profits in excess of $500 million, (d) repurchase obligations with a term of not
more than seven days for underlying securities of the type described in clauses
(b) and (c) above entered into with any financial institution meeting the
qualifications specified in clause (c) above, (e) commercial paper rated at
least P-1 or A-1 by Moody's or S&P, respectively, and in each case maturing
within six months after the date of acquisition, (f) any fund investing
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exclusively in investments of the type described in clauses (a) through (e)
above and (g) in the case of a Foreign Subsidiary, substantially similar
investments denominated in foreign currencies (including similarly capitalized
foreign banks).
"Change of Control" means the occurrence of any of the following: (i)
the sale, transfer, conveyance or other disposition, in one or a series of
related transactions, of all or substantially all the assets of the Company and
its Subsidiaries taken as a whole to any Person or group (as such term is used
in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) other than to a Person or
group who, prior to such transaction, held a majority of the voting power of the
voting stock of the Company, (ii) the acquisition by any Person or group (as
defined above) of a direct or indirect interest in more than 50% of the voting
power of the voting stock of the Company, by way of merger or consolidation or
otherwise, or (iii) the first day on which a majority of the members of the
board of directors of the Company are not Continuing Directors.
"Clearsteam" means Clearsteam Banking SA and its successors.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" means all assets of the Company and its Restricted
Subsidiaries which are subject to Liens pursuant to the terms and provisions of
the Security Documents in order to secure the Indenture Obligations equally and
ratably with the Existing Credit Facility Obligations.
"Collateral Agent" means JPMorgan Chase Bank (as successor to Morgan
Guaranty Trust Company of New York), in its capacity as collateral agent or
administrative agent, or any other collateral agent under any or all of the
Security Documents.
"Company" means Lyondell Chemical Company, a Delaware corporation, and
any successor in interest thereto.
"Company Request," "Company Order" and "Company Consent" mean,
respectively, a written request, order or consent signed in the name of the
Company by an Officer of the Company.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period (less the Net
Income of any Joint Venture to the extent included therein pursuant to clause
(i) of the definition of "Consolidated Net Income"), plus in each case, without
duplication
(i) provision for taxes based on income or profits of such Person and
its Restricted Subsidiaries for such period (including any provision for taxes
on the Net Income of any Joint Venture that is a pass-through entity for federal
income tax purposes, to the extent such taxes are paid or payable by such Person
or any of its Restricted Subsidiaries), to the extent that such provision for
taxes was included in computing such Consolidated Net Income,
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(ii) the Fixed Charges of such Person and its Restricted Subsidiaries
for such period, to the extent that such Fixed Charges were deducted in
computing such Consolidated Net Income,
(iii) depreciation and amortization (including amortization of goodwill
and other intangibles but excluding amortization of prepaid cash expenses that
were paid in a prior period) of such Person and its Restricted Subsidiaries for
such period to the extent that such depreciation and amortization were deducted
in computing such Consolidated Net Income and
(iv) any non-cash charges reducing Consolidated Net Income for such
period (excluding any such non-cash charge to the extent that it represents an
accrual of or reserve for cash expenses in any future period or an amortization
of a prepaid cash expense that was paid in a prior period); minus
(v) any non-cash items increasing Consolidated Net Income for such
period, in each case, on a consolidated basis and determined in accordance with
GAAP.
Notwithstanding the foregoing, the provision for taxes on the income or
profits of, and the depreciation and amortization of, a Restricted Subsidiary of
the referent Person shall be added to Consolidated Net Income to compute
Consolidated Cash Flow only to the extent (and in the same proportion) that the
Net Income of such Restricted Subsidiary was included in calculating the
Consolidated Net Income of such Person.
"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 that
(i) the Net Income of any Person that is not a Restricted Subsidiary
shall be included only to the extent of the lesser of (x) the amount of
dividends or distributions paid in cash (but not by means of a loan) to the
referent Person or a Restricted Subsidiary thereof or (y) the referent
Person's (or a Restricted Subsidiary of the referent Person's) proportionate
share of the Net Income of such other Person,
(ii) the Net Income (but not loss) of any Restricted Subsidiary shall
be excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income is not at
the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of the
terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary or its
stockholders,
(iii) the Net Income of any Person acquired in a pooling of interests
transaction for any period prior to the date of such acquisition shall be
excluded and
(iv) the cumulative effect of a change in accounting principles shall
be excluded.
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"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the common stockholders of such
Person and its Restricted Subsidiaries as of such date plus (ii) the respective
amounts reported on such Person's balance sheet as of such date with respect to
any series of Preferred Stock (other than Disqualified Stock), less all
write-ups (other than write-ups resulting from foreign currency translations and
write-ups of tangible assets of a going concern business made in accordance with
GAAP as a result of the acquisition of such business) subsequent to the date of
the Indenture in the book value of any asset owned by such Person or a
Restricted Subsidiary of such Person, and excluding the cumulative effect of a
change in accounting principles, all as determined in accordance with GAAP.
"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of the Indenture or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board at the time of such
nomination or election or any successor Continuing Directors appointed by such
Continuing Directors (or their successors).
"Corporate Trust Office" means the principal office of the Trustee, at
which at any particular time its corporate trust business shall be administered,
which office on the Issue Date is located at 101 Barclay Street, Floor 21 West,
New York, New York 10286.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Depositary" means The Depository Trust Company, its nominees and
successors.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part, on or prior to the date
on which the Notes mature; provided that any Capital Stock that would not
constitute Disqualified Stock but for provisions thereof giving holders thereof
the right to require such Person to repurchase or redeem such Capital Stock upon
the occurrence of an "asset sale" or a "change of control" occurring prior to
the date on which the Notes mature shall not constitute Disqualified Stock if
the "asset sale" or "change of control" provisions applicable to such Capital
Stock are no more favorable to the holders of such Capital Stock than the
provisions contained in Section 4.09 of the Senior Subordinated Notes Indenture
and Section 4.14 hereof and such Capital Stock specifically provides that such
Person will not repurchase or redeem any such stock pursuant to such provision
prior to the Company's repurchase of such Notes as are required pursuant to such
covenants.
"Distributable Joint Venture Cash Flow" means, with respect to any
Person for any period, in the case of each Joint Venture that is not a
Restricted Subsidiary of the referent Person, the sum of:
7
(I) the lesser of
(x) the amount of dividends or distributions paid in cash (but not by
means of a loan) by such Joint Venture to the referent Person or Restricted
Subsidiary thereof or
(y) the referent Person's (or a Restricted Subsidiary of the
referent Person's) proportionate share of
(i) the Net Income of such Joint Venture for such period,
plus
(ii) to the extent deducted therefrom, depreciation and
amortization (including amortization of goodwill and other
intangibles but excluding amortization of prepaid cash expenses
that were paid in a prior period) of such Joint Venture for such
period, plus
(iii) any non-cash charges reducing Net Income of such Joint
Venture for such period (excluding any such non-cash charge to
the extent that it represents an accrual of or reserve for cash
expenses in any future period or an amortization of a prepaid
cash expense that was paid in a prior period), less
(iv) any non-cash items increasing Net Income of such Joint
Venture for such period, minus
(II) the aggregate amount of all Investments made by the Company or any of
its Restricted Subsidiaries in such Joint Venture during such period pursuant to
Section 4.07(b)(viii),
in each case determined on a consolidated basis and in accordance with GAAP.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equistar Assumed Debt" means (i) the 9.125% Notes Due 2002 issued by the
Company pursuant to an Indenture dated as of March 10, 1992 between the Company
and First Trust National Association, as Trustee, as supplemented by the First
Supplemental Indenture dated as of March 10, 1992 and the Second Supplemental
Indenture dated as of December 1, 1997; (ii) the 6.5% Notes Due 2006 and the
7.55% Notes Due 2026, each issued by the Company pursuant to an Indenture dated
as of January 29, 1996 between the Company and Texas Commerce Bank National
Association, as Trustee, as supplemented by the First Supplemental Indenture
dated as of February 15, 1996 and the Second Supplemental Indenture dated as of
December 1, 1997; and (iii) Indebtedness under the medium term notes issued by
the Company, maturing at various dates from 2002 to 2005; in each case
outstanding as of the Issue Date, and with respect to which, either (x) the
Company is a guarantor or (y) as between the Company and Equistar, Equistar is
the primary obligor and the Company is an
8
obligor; in each case, as may be amended from time to time, provided that any
such amendment does not increase the principal amount thereof or interest rate
applicable thereto or shorten the Weighted Average Life to Maturity or Stated
Maturity thereof or add any Restricted Subsidiary as an obligor with respect
thereto.
"Euroclear" means Euroclear Bank S.A./N.V., and its successors or assigns,
as operator of the Euroclear System.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Notes" means the debt securities of the Company issued pursuant
to this Indenture in exchange for, and in an aggregate principal amount at
maturity equal to, the Initial Notes or any Initial Additional Notes, in
compliance with the terms of a Registration Rights Agreement and containing
terms substantially identical to the Initial Notes or any Initial Additional
Notes (except that (i) such Exchange Notes shall not contain terms with respect
to transfer restrictions and shall be registered under the Securities Act and
(ii) certain provisions relating to Liquidated Damages thereon shall be
eliminated).
"Exchange Offer" means an offer by the Company to the Holders of the
Initial Notes to exchange Outstanding Notes for Exchange Notes, as provided for
in a Registration Rights Agreement.
"Exchange Offer Registration Statement" means the Exchange Offer
Registration Statement as defined in a Registration Rights Agreement.
"Existing ARCO Chemical Debt" means the 9.375% Debentures Due 2005, the
10.25% Debentures Due 2010 and the 9.8% Debentures Due 2020, all issued pursuant
to the Indenture dated June 15, 1988 between the Company (as successor to ARCO
Chemical Company) and The Bank of New York, as Trustee.
"Existing Credit Facility" means that certain Credit Agreement dated as of
July 23, 1998 and as amended through the date hereof by and among the Company
and JPMorgan Chase Bank, as administrative agent, DLJ Capital Funding, Inc., as
syndication agent, and the other lenders that are parties thereto, including any
related notes, instruments and agreements executed in connection therewith, as
amended, restated, modified, extended, renewed, refunded, replaced or
refinanced, in whole or in part, from time to time, after the Issue Date (other
than with the proceeds of the Initial Notes issued on the Issue Date), whether
or not with the same lenders or agents.
"Existing Credit Facility Obligations" means all Obligations of the Company
and its Subsidiaries outstanding under the Existing Credit Facility and all
Hedging Obligations payable to a lender or an Affiliate thereof or to a Person
that was a lender or an Affiliate thereof at the time the contract was entered
into under the Existing Credit Facility, including, without limitation, interest
accruing subsequent to the filing of, or which would have accrued but for the
filing of, a petition for bankruptcy, whether or not such interest is an
allowable claim in such bankruptcy proceeding.
9
"Existing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries in existence, and considered Indebtedness of the Company
or any of its Restricted Subsidiaries, on the Issue Date, until such amounts are
repaid, including all reimbursement obligations with respect to letters of
credit outstanding as of the date of the Indenture.
"Existing Notes Issue Date" means May 17, 1999.
"Existing Security Documents" means each of the Security Documents referred
to in clause (i) of the definition thereof, in each case as amended, modified,
restated or supplemented from time to time.
"Existing Senior Secured Note Indentures" means the indentures among the
Company, the Subsidiary Guarantors party thereto and The Bank of New York, as
Trustee, pursuant to which the Company issued the Existing Senior Secured Notes.
"Existing Senior Secured Notes" means the Company's 9.625% Senior Secured
Notes, Series A, Due 2007 and the 9.875% Senior Secured Notes, Series B, Due
2007.
"Finance Subsidiary" means a Restricted Subsidiary of the Company, all the
Capital Stock of which (other than Preferred Stock) is owned by the Company that
does not engage in any activity other than: (i) holding of Indebtedness of the
Company; (ii) the issuance of Capital Stock; and (iii) any activity necessary,
incidental or related to the foregoing.
"Fixed Charge Coverage Ratio" means with respect to any Person for any
period, the ratio of the Adjusted Consolidated Cash Flow of such Person for such
period to the Fixed Charges of such Person for such period. In the event that
the Company or any of its Restricted Subsidiaries incurs, assumes or redeems any
Indebtedness (other than revolving credit borrowings) or issues or redeems
Preferred Stock subsequent to the commencement of the period for which the Fixed
Charge Coverage Ratio is being calculated but prior to the date on which the
event for which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio shall be calculated
giving pro forma effect to such incurrence, assumption or redemption of
Indebtedness, or such issuance or redemption of Preferred Stock, as if the same
had occurred at the beginning of the applicable four-quarter reference period.
In addition, for purposes of making the computation referred to above, (i)
acquisitions that have been made by the Company or any of its Restricted
Subsidiaries, including through mergers or consolidations and including any
related financing transactions, during the four-quarter reference period or
subsequent to such reference period and on or prior to the Calculation Date
shall be deemed to have occurred on the first day of the four-quarter reference
period, (ii) the Adjusted Consolidated Cash Flow and Fixed Charges attributable
to operations or businesses disposed of prior to the Calculation Date shall be
excluded, but, in the case of such Fixed Charges, only to the extent that the
obligations giving rise to such Fixed Charges will not be obligations of the
referent Person or any of its Restricted Subsidiaries following the Calculation
Date
10
and (iii) if since the beginning of the four-quarter reference period any Person
was designated as an Unrestricted Subsidiary or redesignated as or otherwise
became a Restricted Subsidiary, such event shall be deemed to have occurred on
the first day of the four-quarter reference period.
"Fixed Charges" means, with respect to any Person for any period, the
sum, without duplication, of
(i) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued (including,
without limitation, amortization of original issue discount, non-cash interest
payments, the interest component of any deferred payment obligations, the
interest component of all payments associated with Capital Lease Obligations,
commissions, discounts and other fees and charges incurred in respect of letters
of credit or bankers' acceptance financings and net payments or receipts
(if any) pursuant to Hedging Obligations) and
(ii) the consolidated interest expense of such Person and its
Restricted Subsidiaries that was capitalized during such period and
(iii) any interest expense on Indebtedness of another Person (other
than Non-Recourse Debt of a Joint Venture or an Unrestricted Subsidiary secured
by a pledge by the Company or any Restricted Subsidiary of Capital Stock which
pledge is permitted by Section 4.07(b)(xi) or Section 4.07(b)(xii)) that is
Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a
Lien on assets of such Person or one of its Restricted Subsidiaries (whether or
not such Guarantee or Lien is called upon) and
(iv) the product of (a) all dividend payments (other than any payments
to the referent Person or any of its Restricted Subsidiaries) on any series of
Preferred Stock of such Person and its Restricted Subsidiaries, times (b) a
fraction, the numerator of which is one and the denominator of which is one
minus the then current combined federal, state and local statutory tax rate of
such Person, expressed as a decimal, in each case, on a consolidated basis and
in accordance with GAAP;
provided that (i) interest payments by Equistar on the Equistar Assumed Debt and
(ii) interest payments on Indebtedness of a Joint Venture shall, in each case,
not be deemed Fixed Charges of the Company as of any date of determination when
such Indebtedness is not considered Indebtedness of the Company or any
Restricted Subsidiary of the Company.
"Foreign Subsidiary" means any Restricted Subsidiary that has 50% or
more of its assets located outside the United States or any territory thereof.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, as in effect on the Issue Date.
11
"General Partner" means a Restricted Subsidiary of the Company or any
of its Restricted Subsidiaries that has no assets and conducts no operations
other than its ownership of a general partnership interest in a Joint Venture.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or Disqualified
Stock of any other Person and, without limiting the generality of the foregoing,
any obligation, direct or indirect, contingent or otherwise, of such Person (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or Disqualified Stock of such other Person (including those
arising by virtue of partnership arrangements (other than, in the case of the
Company or a Restricted Subsidiary of the Company, with respect to the
obligations of a Joint Venture, solely by virtue of a Restricted Subsidiary of
the Company being the General Partner of such Joint Venture if, as of the date
of determination, no payment on such Indebtedness or obligation has been made by
such General Partner of such Joint Venture and such arrangement would not be
classified and accounted for, in accordance with GAAP, as a liability on a
consolidated balance sheet of the Company)) or (ii) entered into for purposes of
assuring in any other manner the obligee of such Indebtedness or Disqualified
Stock of the payment thereof or to protect such obligee against loss in respect
thereof in whole or in part (including by agreement to keep-well, to purchase
assets, goods, securities or services, to take-or-pay, to maintain financial
statement conditions or otherwise); provided that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, (ii) forward foreign
exchange contracts or currency swap agreements, (iii) other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates or currency values and (iv) agreements designed to protect such Person
against fluctuations in raw material prices.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"Indebtedness" means, with respect to any Person, any indebtedness of
such Person, whether or not contingent, in respect of borrowed money or
evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or banker's acceptances
or representing Capital Lease Obligations or the balance deferred and unpaid of
the purchase price of any property or representing net Hedging Obligations,
except any such balance that constitutes an accrued expense or a trade payable,
if and to the extent any of the foregoing indebtedness (other than letters of
credit and Hedging Obligations) would appear as a liability on a balance sheet
of such Person prepared in accordance with GAAP, as well as all indebtedness of
others secured by a Lien on any asset of such Person whether or not such
indebtedness is assumed by such Person (provided that, for purposes of
determining the amount of any Indebtedness of the type described in this clause,
if recourse with respect to such Indebtedness is limited to such asset, the
amount of such Indebtedness shall be limited to the lesser of the fair market
value of such asset or the amount of such
12
Indebtedness) and, to the extent not otherwise included, the Guarantee by such
Person of any indebtedness of the types described above of any other Person;
provided that Indebtedness shall not include the pledge by the Company or any of
its Restricted Subsidiaries of the Capital Stock of a Joint Venture Subsidiary,
an Unrestricted Subsidiary or a Joint Venture permitted by Section 4.07(b)(xi)
or Section 4.07(b)(xii) to secure Non-Recourse Debt of such Unrestricted
Subsidiary or Joint Venture.
The Equistar Assumed Debt shall not constitute Indebtedness of the
Company as of any date of determination if the Company has not made any
principal or interest payments on such Indebtedness after the Issue Date;
provided that, the payment by the Company of any principal or interest thereon
shall be deemed to be an incurrence of such Indebtedness on the day of such
payment. The amount of any Indebtedness outstanding as of any date shall be (i)
the accreted value thereof, in the case of any Indebtedness that does not
require current payments of interest and (ii) the principal amount thereof,
together with any interest thereon that is more than 30 days past due, in the
case of any other Indebtedness.
"Indenture Obligations" means (a) all principal of and interest
(including, without limitation, (i) any Liquidated Damages and (ii) any interest
which accrues after the commencement of any case, proceeding or other action
relating to the bankruptcy, insolvency or reorganization of the Company, whether
or not allowed or allowable as a claim in any such proceeding) on any Note
issued pursuant to the Indenture, (b) all other amounts payable by the Company
or any Subsidiary Guarantor under the Indenture and (c) any renewals or
extensions of any of the foregoing.
"Initial Additional Notes" means Additional Notes issued in an offering
not registered under the Securities Act.
"Initial Notes" means the Company's 9 1/2% Senior Secured Notes Due
2008, issued on the Issue Date (and any Notes issued in respect thereof pursuant
to Section 3.04, 3.05, 3.06, 3.13, 3.14 or 10.08), but not including any
Exchange Notes issued in exchange therefor.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Payment Date" means, when used with respect to any Note and
any installment of interest thereon, the date specified in such Note as the
fixed date on which such installment of interest is due and payable, as set
forth in such Note.
"Investment Grade" means a rating of BBB- or higher by S&P or Baa3 or
higher by Moody's or the equivalent of such ratings by S&P or Moody's. In the
event that the Company shall select any other Rating Agency pursuant to the
provisions of the definition thereof, the equivalent of such ratings by such
Rating Agency shall be used.
"Investments" means, with respect to any Person, all investments by
such Person in another Person (including an Affiliate of such Person) in the
form of direct or
13
indirect loans, advances or extensions of credit to such other Person (including
any Guarantee by such Person of the Indebtedness or Disqualified Stock of such
other Person) or capital contributions or purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities of such
other Person, together with all items that are or would be classified as
investments of such investing Person on a balance sheet prepared in accordance
with GAAP; provided that (x) trade credit and accounts receivable in the
ordinary course of business, (y) commissions, loans, advances, fees and
compensation paid in the ordinary course of business to officers, directors and
employees and (z) reimbursement obligations in respect of letters of credit and
tender, bid, performance, government contract, surety and appeal bonds, in each
case solely with respect to obligations of the Company or any of its Restricted
Subsidiaries shall not be considered Investments. If the Company or any
Restricted Subsidiary of the Company sells or otherwise disposes of any Equity
Interests of any direct or indirect Restricted Subsidiary of the Company such
that, after giving effect to any such sale or disposition, such Person is no
longer 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 Equity Interests of such Restricted Subsidiary not sold
or disposed of in an amount determined as provided in Section 4.07(a).
"Issue Date" means the date on which the Initial Notes are originally
issued.
"Joint Venture" means any joint venture between the Company or any
Restricted Subsidiary and any other Person, whether or not such joint venture is
a Subsidiary of the Company or any Restricted Subsidiary.
"Joint Venture Subsidiary" means a Subsidiary of the Company or any of its
Subsidiaries that has no assets and conducts no operations other than its
ownership of Equity Interests of a Joint Venture.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest (other than, in the case of a Receivables Facilities,
security interests under the Uniform Commercial Code arising solely by virtue of
the application of Article 9 thereof to sales of accounts) or encumbrance of any
kind in respect of such asset, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement, and any lease in the nature thereof) or the assignment or
conveyance of any right to receive income therefrom.
"Liquidated Damages" means liquidated damages owed to the Holders
pursuant to a Registration Rights Agreement.
"Lyondell TDI" means Lyondell Chimie France TDI, a French limited
partnership and a wholly-owned Subsidiary of the Company.
"Major Asset Sale" means an Asset Sale designated by the Company by prior
notice to the Trustee as a Major Asset Sale, so long as in connection therewith
14
(i) the Company receives Net Proceeds in an aggregate amount not less
than $1,000,000,000 (which shall be deemed Net Proceeds of such Major Asset Sale
for purposes of Section 4.09),
(ii) at the time of such Major Asset Sale and after giving effect
thereto, no Default shall exist,
(iii) the sum of the gross cash proceeds received by the Company in
respect of such Major Asset Sale plus the value of the interest of the Company
in the Subject Assets Transferee (if any) after giving effect to such Major
Asset Sale is not less than the value (as conclusively determined by the Board
of Directors of the Company) of the portion of the Subject Assets transferred by
the Company in connection with such Major Asset Sale, and
(iv) the Company directly or indirectly is the operator of the Subject
Assets in which it or a Subject Assets Transferee retains an interest. For
purposes of clause (i) of this definition (1) a transaction that produces
substantially the same economic result as a sale of a partial interest in an
asset, as might be achieved, for instance, through contractual arrangement
allocating future revenues and costs attributable to the asset, shall be deemed
an Asset Sale even though there may be no change in title to the asset or in the
ownership of the Person that has title to the asset and (2) a subsequent related
transaction with the same Acquired Person (or an Affiliate thereof) contemplated
by the terms of the initial Major Asset Sale with such Person shall, for
purposes of determining the applicability of and compliance with this
definition, be deemed a single cumulative transaction.
"Moody's" means Moody's Investors Service, Inc., and its successors.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of Preferred Stock dividends, excluding, however, (i) any gain or loss,
together with any related provision for taxes on such gain or loss, realized in
connection with (a) any Asset Sale or any disposition pursuant to a Sale and
Leaseback Transaction or (b) the disposition of any securities by such Person or
any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries and (ii) any extraordinary
gain or loss, together with any related provision for taxes on such
extraordinary gain or loss.
"Net Proceeds" means the aggregate cash proceeds (excluding any
proceeds deemed to be "cash" pursuant to Section 4.09) received by the Company
or any of its Restricted Subsidiaries in respect of any Asset Sale (including,
without limitation, any cash received upon the sale or other disposition of any
non-cash consideration received in any Asset Sale), net of the direct costs
relating to such Asset Sale (including, without limitation, legal, accounting
and investment banking fees and sales commissions) and any relocation expenses
incurred as a result thereof, taxes paid or payable as a result thereof (after
taking into account any available tax credits or deductions and any tax sharing
arrangements), amounts required to be paid to holders of minority interests in
Restricted Subsidiaries as a result of such Asset Sale, amounts required to be
applied to
15
the repayment of Indebtedness (other than Indebtedness under the Existing Credit
Facility, the Existing Senior Secured Notes or the Existing ARCO Chemical Debt)
secured by a Lien on any asset sold in such Asset Sale and any reserves for
adjustment in respect of the sale price of such asset or assets established in
accordance with GAAP and any reserve for future liabilities established in
accordance with GAAP; provided that the reversal of any such reserve that
reduced Net Proceeds when issued shall be deemed a receipt of Net Proceeds in
the amount of such proceeds on such day.
"Non-Recourse Debt" means Indebtedness as to which the lenders have
been notified in writing that they will not have any recourse to the stock or
assets (in each case, other than the stock of a Joint Venture or an Unrestricted
Subsidiary or of a Joint Venture Subsidiary that has no assets and conducts no
operations other than the holding, directly or indirectly, of Equity Interests
of such Joint Venture pledged by the Company or any of its Restricted
Subsidiaries to secure debt of such Joint Venture or Unrestricted Subsidiary) of
the Company or any of its Restricted Subsidiaries.
"Non-U.S. Person" means a Person who is not a U.S. person, as defined
in Regulation S.
"Notes" means the Initial Notes, any Additional Notes and the Exchange
Notes.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness and in all cases whether direct or
indirect, absolute or contingent, now outstanding or hereafter created, assumed
or incurred and including, without limitation, interest accruing subsequent to
the filing of a petition in bankruptcy or the commencement of any insolvency,
reorganization or similar proceedings at the rate provided in the relevant
documentation, whether or not an allowed claim, and any obligation to redeem or
defease any of the foregoing.
"Officer" means, with respect to the Company, any Subsidiary Guarantor
or any other obligor on the Notes, the Chairman of the Board, the President, the
Chief Executive Officer, the Chief Financial Officer, the Secretary, the
Treasurer, any Assistant Secretary or Assistant Treasurer or any Vice President
of such Person.
"Officer's Certificate" means, with respect to the Company or any other
obligor on the Notes, a certificate signed by an Officer of such Person.
"Opinion of Counsel" means a written opinion from legal counsel. The
counsel may be an employee of or counsel to the Company or the Trustee.
"Original Notes" means the Initial Notes and any Exchange Notes issued
in exchange therefor.
"Outstanding" when used with respect to Notes means, as of the date of
determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
16
(i) Notes theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Notes for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying
Agent in trust for the Holders of such Notes, provided that, if such
Notes are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture or provision therefor reasonably
satisfactory to the Trustee has been made;
(iii) Notes paid pursuant to Section 3.06; and
(iv) Notes in exchange for or in lieu of which other Notes have
been authenticated and delivered pursuant to this Indenture.
A Note does not cease to be Outstanding because the Company or any
Affiliate of the Company holds the Note, provided that in determining whether
the Holders of the requisite amount of Outstanding Notes have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Notes
owned by the Company or any Affiliate of the Company shall be disregarded and
deemed not to be Outstanding, except that, for the purpose of determining
whether the Trustee shall be protected in relying on any such request, demand,
authorization, direction, notice, consent or waiver, only Notes which a
Responsible Officer of the Trustee actually knows are so owned shall be so
disregarded. Notes so owned that have been pledged in good faith may be regarded
as Outstanding if the pledgee establishes to the reasonable satisfaction of the
Trustee the pledgee's right to act with respect to such Notes and that the
pledgee is not the Company or an Affiliate of such Company.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest and Liquidated Damages, if any,
on any Notes on behalf of the Company.
"Payment Default" means any failure to pay any scheduled installment of
interest or principal on any Indebtedness within the grace period provided for
such payment in the documentation governing such Indebtedness.
"PBGC Settlement" means the settlement agreement between the Company
and the Pension Benefit Guaranty Corporation (or any successor entity) as
amended, modified, restated or replaced from time to time.
"Permitted Business" means the petrochemical, chemical and petroleum
refining businesses and any business reasonably related, incidental,
complementary or ancillary thereto.
"Permitted Investments" means:
(a) any Investment in the Company or in a Restricted Subsidiary of the
Company that is engaged in a Permitted Business;
17
(b) any Investment in Cash Equivalents;
(c) any Investment by the Company or any Subsidiary of the Company in a
Person, if as a result of such Investment: (i) such Person becomes a Restricted
Subsidiary of the Company engaged in a Permitted Business or (ii) such Person
is merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all its assets to, or is liquidated into, the Company or a
Restricted Subsidiary of the Company engaged in a Permitted Business;
(d) any non-cash consideration (other than a joint venture interest
received in full or partial satisfaction of the 80% requirement in clause (ii)
of Section 4.09(a)) received as consideration in an Asset Sale that was made
pursuant to and in compliance with Section 4.09;
(e) any acquisition of assets or Equity Interests solely in exchange for
the issuance of Equity Interests (other than Disqualified Stock) of the
Company;
(f) Hedging Obligations entered into in the ordinary course of business
and otherwise permitted under the Indenture;
(g) Investments in an Accounts Receivable Subsidiary that, as
conclusively determined by the Board of Directors, are necessary or advisable to
effect a Receivables Facility;
(h) Investments in Unrestricted Subsidiaries and Joint Ventures in an
aggregate amount, taken together with all other Investments made in reliance on
this clause (h), not to exceed at any time outstanding $25 million (after giving
effect to any reductions in the amount of any such Investments as a result of
the repayment or other disposition thereof for cash, the amount of such
reduction not to exceed the amount of such Investments previously made pursuant
to this clause (h)); and
(i) any Investment received by the Company or any Restricted Subsidiary
as consideration for the settlement of any litigation, arbitration or claim in
bankruptcy or in partial or full satisfaction of accounts receivable owned by a
financially troubled Person to the extent reasonably necessary in order to
prevent or limit any loss by the Company or any of its Restricted Subsidiaries
in connection with such accounts receivable.
"Permitted Liens" means:
(i) Liens in favor of the Company or any Subsidiary Guarantor;
(ii) Liens securing the Notes and the Subsidiary Guarantees;
(iii) Liens on property of a Person existing at the time such Person is
merged into or consolidated with the Company or any Restricted Subsidiary of the
Company or becomes a Subsidiary of the Company; provided that such Liens were in
existence prior to the contemplation of such merger, consolidation or
acquisition and do not extend to
18
any assets of the Company or its Restricted Subsidiaries other than those of the
Person merged into or consolidated with the Company or that becomes a Restricted
Subsidiary of the Company;
(iv) Liens on property existing at the time of acquisition thereof by the
Company or any Restricted Subsidiary of the Company; provided that such Liens
were in existence prior to the contemplation of such acquisition;
(v) Liens (including the interest of a lessor under a capital lease) on
any asset existing at the time of acquisition thereof or incurred within 180
days of the time of acquisition or completion of construction thereof, whichever
is later, to secure or provide for the payment of all or any part of the
purchase price (or construction price) thereof;
(vi) Liens incurred or assumed in connection with the issuance of revenue
bonds the interest on which is exempt from federal income taxation pursuant to
Section 103(b) of the Internal Revenue Code;
(vii) Liens imposed by law, such as laborers' or other employees',
carriers', warehousemen's, mechanics', materialmen's and vendors' Liens and
Liens imposed by law on pipelines or pipeline facilities;
(viii) Liens arising by reason of deposits necessary to qualify the Company
or any Restricted Subsidiary to conduct business, maintain self insurance or
comply with any law and Liens securing the PBGC Settlement;
(ix) Liens to secure the performance of statutory obligations, tender,
bid, performance, government contract, surety or appeal bonds or other
obligations of a like nature incurred in the ordinary course of business;
(x) Liens existing on the Issue Date other than Liens securing
Indebtedness under the Existing Credit Facility, the Existing Senior Secured
Notes or the Existing ARCO Chemical Debt;
(ix) Liens for taxes, assessments or governmental charges or claims that
are not yet delinquent or that are being contested in good faith by appropriate
proceedings, prejudgment Liens that are being contested in good faith by
appropriate proceedings and Liens arising out of judgments or awards against the
Company or any Restricted Subsidiary with respect to which the Company or such
Restricted Subsidiary at the time shall be prosecuting an appeal or proceedings
for review and with respect to which it shall have secured a stay of execution
pending such appeal or proceedings for review; provided that in each case any
reserve or other appropriate provision as shall be required in conformity with
GAAP shall have been made therefor;
(xii) easements, rights-of-way, restrictions, irregularities of title and
other similar charges or encumbrances, not interfering in any material respect
with the ordinary conduct of the business of the Company or any of its
Restricted Subsidiaries;
19
(xiii) Liens securing reimbursement obligations with respect to
commercial letters of credit obtained in the ordinary course of business which
encumber documents and other property or assets relating to such letters of
credit and products and proceeds thereof;
(xiv) Liens securing assets under construction arising from progress or
partial payments by a customer of the Company or its Restricted Subsidiaries
relating to such property or assets;
(xv) licenses or leases by the Company or any of its Restricted
Subsidiaries as licensor or lessor in the ordinary course of business and
otherwise permitted by the Indenture for patents, copyrights, trademarks,
tradenames and other intellectual property;
(xvi) leases or subleases by the Company or any of its Restricted
Subsidiaries as lessor or sublessor in the ordinary course of business and
otherwise permitted by the indenture;
(xvii) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(xviii) Liens resulting from the deposit of funds or evidences of
Indebtedness in trust for the purpose of (A) defeasing Indebtedness of the
Company or any of its Restricted Subsidiaries (which defeasance is otherwise
permitted under the Indenture) having an aggregate principal amount at any one
time outstanding not to exceed $25 million or (B) defeasing Indebtedness ranking
pari passu with the Notes; provided that the Notes are defeased concurrently
with such Indebtedness;
(xix) from and after the first date when the Notes are rated Investment
Grade, Liens on any asset of the Company other than any of the Company's or any
of its Restricted Subsidiary's manufacturing plants or Liens on any Equity
Interests of any Restricted Subsidiary that owns a manufacturing plant;
(xx) the pledge of Equity Interests of an Unrestricted Subsidiary or a
Joint Venture (or of a Joint Venture Subsidiary that has no assets and conducts
no operations other than the holding, directly or indirectly, of Equity
Interests of such Joint Venture) organized (or designated as an Unrestricted
Subsidiary and holding no other assets and conducting no other operations) to
construct, own and/or operate a propylene oxide plant in the European Union to
secure Non-Recourse Debt of such Joint Venture or Unrestricted Subsidiary;
(xxi) the pledge of Equity Interests of an Unrestricted Subsidiary or a
Joint Venture (or of a Joint Venture Subsidiary that has no assets and conducts
no operations other than the holding, directly or indirectly, of Equity
Interests of such Joint Venture) organized (or designated as an Unrestricted
Subsidiary and holding no other assets and conducting no other operations) to
participate in the improvement of the Rhodia TDI Plant to secure Non-Recourse
Debt of such Joint Venture or Unrestricted Subsidiary or Rhodia or a
wholly-owned subsidiary of Rhodia;
20
(xxii) Liens on equipment of the Company or any Restricted Subsidiary
arising as a result of a sale and leaseback with respect to such equipment;
provided that the proceeds from such sale and leaseback are applied pursuant to
Section 4.09;
(xxiii) Asset Sale Liens;
(xxiv) customary Liens for the fees, costs and expenses of trustees and
escrow agents pursuant to any indenture, escrow agreement or similar agreement
establishing a trust or an escrow arrangement, and Liens pursuant to merger
agreements, stock purchase agreements, asset sale agreements, option agreements
and similar agreements in respect of the disposition of property or assets of
the Company or any Restricted Subsidiary, to the extent such dispositions are
permitted hereunder;
(xxv) netting provisions and setoff rights in favor of counterparties to
agreements creating Hedging Obligations;
(xxvi) other Liens on assets of the Company or any Restricted Subsidiary
of the Company securing Indebtedness that is permitted by the terms of the
Indenture to be outstanding having an aggregate principal amount at any one time
outstanding not to exceed $100 million; and
(xxvii) Liens to secure a Permitted Refinancing incurred to refinance
Indebtedness that was secured by a Lien permitted under the Indenture and that
was incurred in accordance with the provisions of the Indenture; provided that
such Liens do not extend to or cover any property or assets of the Company or
any Restricted Subsidiary other than assets or property securing the
Indebtedness so refinanced.
"Permitted Refinancing" means any Indebtedness of the Company or any of
its Subsidiaries or Preferred Stock of a Finance Subsidiary issued in exchange
for, or the net proceeds of which are used solely to extend, refinance, renew,
replace, defease or refund, other Indebtedness of the Company or any of its
Restricted Subsidiaries; provided that:
(i) the principal amount (or liquidation preference in the case of
Preferred Stock) of such Permitted Refinancing (or if such Permitted Refinancing
is issued at a discount, the initial issuance price of such Permitted
Refinancing) does not exceed the Principal amount of the Indebtedness so
extended, refinanced, renewed, replaced, defeased or refunded (plus the amount
of any premiums paid and reasonable expenses incurred in connection therewith);
(ii) such Permitted Refinancing or, in the case of Preferred Stock of a
Finance Subsidiary, the Indebtedness issued to such Finance Subsidiary, has a
Stated Maturity date later than the stated Maturity date of, and has a Weighted
Average Life to Maturity equal to or greater that the Weighted Average Life to
Maturity of, the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded;
(iii) if the Indebtedness being extended, refinanced, renewed, replaced,
defeased or refunded is subordinated by its terms in right of payment to the
Notes or the Subsidiary Guarantees, such Permitted Refinancing, or, in the case
of Preferred stock,
21
the Indebtedness issued to such Finance subsidiary, has a Stated Maturity date
later than the Stated Maturity date of, and is subordinated in right of payment
to, the Notes on subordination terms at least as favorable to the Holders of
Notes as those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded;
(iv) such Indebtedness is incurred by the Company or a Subsidiary
Guarantor (or such Preferred Stock is issued by a Finance Subsidiary) if the
Company or a Subsidiary Guarantor is the obligor on the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and
(v) such Indebtedness is incurred by the Company or a Restricted
Subsidiary (or such Preferred Stock is issued by a Finance Subsidiary) if a
Restricted Subsidiary that is not a Subsidiary Guarantor is the obligor on the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Place of Payment" means a city or any political subdivision thereof
referred to in Article 3 and initially designated under Section 4.02.
"Predecessor Notes" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 3.06 in lieu of a mutilated,
destroyed, lost or stolen Note shall be deemed to evidence the same debt as the
mutilated, destroyed, lost or stolen Note.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of preferred or preference stock of such Person which is
outstanding or issued on or after the date of the Indenture.
"principal" of a Note means the principal of the Note plus the premium,
if any, payable on the Note which is due or overdue or is to become due at the
relevant time.
"QIB", or "Qualified Institutional Buyer" means a "qualified
institutional buyer," as the term is defined in Rule 144A under the Securities
Act.
"Qualified Equity Interests" shall mean all Equity Interests of a Person
other than Disqualified Stock of such Person.
"Rating Agency" means (i) S&P or (ii) Moody's or (iii) if neither S&P nor
Moody's shall exist, a nationally recognized securities rating agency or
agencies, as the case may be, selected by the Company, which shall be
substituted for S&P or Moody's or both, as the case may be.
22
"Receivables Facility" means one or more receivables financing facilities
or arrangements, as amended from time to time, pursuant to which the Company or
any of its Restricted Subsidiaries sells (including a sale in exchange for a
promissory note of or an Equity Interest in an Accounts Receivable Subsidiary)
its accounts receivable to an Accounts Receivable Subsidiary.
"Receivables Fees" means distributions or payments made directly or by
means of discounts with respect to any participation interests issued or sold in
connection with, and other fees paid to a Person that is not the Company or a
Restricted Subsidiary in connection with, any Receivables Facility.
"Redemption Date" when used with respect to any Note to be redeemed or
purchased means the date fixed or such redemption or purchase by or pursuant to
this Indenture and the Notes.
"Redemption Price" when used with respect to any Note to be redeemed or
purchased means the price at which it is to be redeemed or purchased pursuant to
this Indenture and the Notes.
"Registration Rights Agreement" means (i) the Registration Rights
Agreement dated as of December 4, 2001 among the Company, the Subsidiary
Guarantors party thereto and the Initial Purchasers party thereto, as such
agreement may be amended from time to time, and (ii) with respect to any Initial
Additional Notes, one or more registration rights agreements between the Company
and the other parties thereto, as such agreement(s) may be amended from time to
time, relating to rights given by the Company to the purchasers of Initial
Additional Notes to register or exchange such Initial Additional Notes under the
Securities Act.
"Registration Statement" means the Registration Statement as defined in
the Registration Rights Agreement.
"Regular Record Date" for the interest payable on any Interest Payment
Date means the date specified for that purpose in Section 3.01.
"Regulation S" means Regulation S under the Securities Act.
"Resale Restriction Termination Date" means, with respect to any Note,
the date that is two years (or such other period as may hereafter be provided
under Rule 144(k) under the Securities Act or any successor provision thereto as
permitting the resale by non-affiliates of Restricted Securities without
restriction) after the later of the original issue date in respect of such Note
and the last date on which the Company or any Affiliate of the Company was the
owner of such Note (or any Predecessor Note thereto).
"Responsible Officer" when used with respect to the Trustee means any
officer in the corporate trust department of the Trustee, and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his or her knowledge of and familiarity with the
particular subject.
23
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Period" means the 40-day distribution compliance period as
defined in Regulation S which, in the case of the Initial Notes, ends January
14, 2002.
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; provided, however, that the Trustee shall be
entitled to receive, at its request, and conclusively rely on an Opinion of
Counsel with respect to whether any Note constitutes a Restricted Security.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary. Unless the context
otherwise requires, references to a "Restricted Subsidiary" refer to a
Restricted Subsidiary of the Company.
"Rhodia" means Rhodia S.A., a French company and the successor in
interest to Rhone-Poulenc Chemie S.A. under the TDI Agreements.
"Rhodia TDI Plant" means the manufacturing facilities for the
production of toluene diisocyanate, currently owned by Rhodia and located at
Pont-de-Claix, France.
"Sale and Leaseback Transaction" means, with respect to any Person, any
arrangement with a lender or an investor providing for the leasing by such
Person of any property or asset of such Person which has been or is being sold
or transferred by such Person to such lender or investor if such arrangement is
accounted for as a capitalized lease by such Person under GAAP.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Documents" means (i) the Security Agreement dated the
Existing Notes Issue Date between the Company and the Collateral Agent, each of
the Pledge Agreements dated as of July 28, 1998 between the Company and the
Collateral Agent, the Security Agreement dated as of July 28, 1998 among
Lyondell Petrochemical G.P. Inc., Lyondell Petrochemical L.P. Inc., and the
Collateral Agent, the Security Agreement dated as of July 28, 1998 among
Lyondell Refining Company and the Collateral Agent, the Security Agreement dated
as of July 28, 1998 among Lyondell General Methanol Company and Lyondell Limited
Methanol Company and the Collateral Agent, the Pledge Agreement dated as of
December 31, 1998 between the Company and the Collateral Agent relating to the
pledge of shares of capital stock of Lyondell Refining LP, LLC, the Security
Agreement dated as of the Existing Notes Issue Date between the Company (as
successor to Lyondell Chemical Worldwide, Inc.) and the Collateral Agent, the
Pledge Agreement dated as of the Existing Notes Issue Date between the Company
(as successor to Lyondell Chemical Worldwide, Inc.) and the Collateral Agent,
the Security Agreement dated as of December 31, 1998 between Lyondell Refining
LP, LLC and the Collateral Agent, the Deed of Trust dated as of May 13, 1999
(but effective as of the Existing Notes Issue Date) relating to Bayport, Texas
facility from the Company (as
24
successor to Lyondell Chemical Worldwide, Inc.) to the trustee named therein for
the benefit of the Collateral Agent, the Deed of Trust dated May 13, 1999 (but
effective as of the Existing Notes Issue Date) relating to Channelview, Texas
facility from the Company (as successor to Lyondell Chemical Worldwide, Inc.) to
the trustee named therein for the benefit of the Collateral Agent, the Mortgage
dated as of May 13, 1999 (but effective as of the Existing Notes Issue Date)
relating to Lake Charles, Louisiana facility from the Company (as successor to
Lyondell Chemical Worldwide, Inc.) to the Collateral Agent, the Pledge Agreement
dated as of March 31, 2000 between Company and the Collateral Agent relating to
the pledge of limited liability company interests in each of Lyondell POJVGP,
LLC, Lyondell POJVLP1, LLC, Lyondell POJVLP2, LLC and Lyondell POJVLP3, LLC, the
Security Agreement dated as of March 31, 2000 between PO Offtake, LP and the
Collateral Agent; and the Security Agreement dated as of March 31, 2000 among
Lyondell POTechGP, Inc., Lyondell POTechLP, Inc. and the Collateral Agent and
(ii) any other pledge agreements, security agreements, mortgages, deeds of trust
or other agreements or instruments between the Company and/or any of its
Restricted Subsidiaries and the Collateral Agent granting Liens on any asset of
the Company or any of its Restricted Subsidiaries to secure the Existing Credit
Facility Obligations, in each case as amended, modified, restated or
supplemented from time to time.
"Senior Indebtedness" has the meaning assigned to such term in the
Senior Subordinated Notes Indenture.
"Senior Subordinated Notes" means the Company's 10 7/8% Senior
Subordinated Notes Due 2009.
"Senior Subordinated Notes Indenture" means the indenture relating to
the Company's Senior Subordinated Notes.
"Shelf Registration Statement" means the Shelf Registration Statement
as defined in a Registration Rights Agreement.
"Significant Asset Sale" means an Asset Sale of (x) any of the
Company's or its Restricted Subsidiaries' plants that (a) has a fair market
value in excess of $50 million or (b) for Net Proceeds in excess of $50 million
(a "Significant Asset") or (y) a controlling interest in any Restricted
Subsidiary that owns a Significant Asset (other than, in each case, an
involuntary disposition, to the extent that the Existing Credit Facility (but
not any refinancing thereof other than a credit facility with commercial banks
and other lenders) permits the proceeds thereof to be reinvested prior to any
mandatory prepayment of amounts outstanding thereunder).
"Significant Subsidiary" means any Restricted Subsidiary that would be
a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Act, as such Regulation is in effect on the Issue
Date.
"Specified Joint Ventures" means (i) Equistar Chemicals, LP, (ii)
LYONDELL-CITGO Refining LP ("LCR") and (iii) Lyondell Methanol Company, L.P.
25
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.07.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., and its successors.
"Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness, the date on which such payment of
interest or principal was scheduled to be paid in the original documentation
governing such Indebtedness (or any later date established by any amendment to
such original documentation) and shall not include any contingent obligations to
repay, redeem or repurchase any such interest or principal prior to the date
originally scheduled for the payment thereof.
"Subject Assets" means, with respect to any Major Asset Sale, the
assets that are the subject of such Major Asset Sale.
"Subject Assets Transferee" means any Restricted Subsidiary or Joint
Venture that becomes the owner of Subject Assets in connection with a Major
Asset Sale.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or one or more Subsidiaries
of such Person (or any combination thereof) or (c) that is a Specified Joint
Venture and as to which (i) a general partner of which is such Person or a
Subsidiary of such Person, (ii) such Person owns, directly or indirectly, 50% or
more of the partnership interests of such Specified Joint Venture and (iii) the
Board of Directors of such Person has designated such Specified Joint Venture to
be a "Subsidiary" (which designation shall be irrevocable for so long as such
Specified Joint Venture satisfies the foregoing requirements). As of the Issue
Date, none of the Specified Joint Ventures are Subsidiaries of the Company.
Unless the context otherwise requires, references to a "Subsidiary" refer to a
Subsidiary of the Company.
"Subsidiary Guarantee" means a Guarantee by a Subsidiary Guarantor of
the Company' obligations with respect to the Notes.
"Subsidiary Guarantor" means (i) ARCO Chemical Technology, Inc., ARCO
Chemical Technology, L.P. and Lyondell Chemical Nederland, Ltd. and (ii) each
Restricted Subsidiary that executes a supplemental indenture, in the form of
Exhibit B hereto, providing for the Guarantee of the payment of the Notes, in
each case until such time as such Subsidiary is released from its Subsidiary
Guarantee as permitted by this Indenture.
26
"TDI Agreements" means (i) the Share Purchase Agreement dated as of
January 23, 1995 between ARCO Chemical Europe Inc. and Rhone-Poulenc Chemie
S.A., as such agreement may be amended, supplemented or otherwise modified from
time to time, (ii) the Processing Agreement dated as of January 23, 1995 between
ARCO Chemical Chemie TDI and Rhone-Poulenc Chemie S.A., as such agreement may be
amended, supplemented or otherwise modified from time to time, and (iii) the TDI
License.
"TDI Assets" means (i) all rights of ARCO Chemical Europe Inc., ARCO
Chemical Chemie TDI, ARCO Chemical Technology, LP and their respective
successors under the TDI Agreements and (ii) all of Lyondell TDI's customer
lists relating to the Rhodia TDI Plant.
"TDI License" means the TDI Technology Agreement dated as of January
23, 1995 between ARCO Chemical Technology LP and Rhone-Poulenc Chemie S.A., as
such agreement may be amended, supplemented or otherwise modified from time to
time.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. sections
77aaa-77bbbb) as in effect on the date of this Indenture, except as provided by
Section 9.04.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that
is designated by the Board of Directors of the Company as an Unrestricted
Subsidiary pursuant to a board resolution, (ii) any Subsidiary of an
Unrestricted Subsidiary and (iii) any Accounts Receivable Subsidiary. The Board
of Directors may designate any Subsidiary of the Company (including any newly
acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless
such Subsidiary or any of its Subsidiaries owns any Equity Interest or
Indebtedness of, or holds any Lien on any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated; provided that
(a) any Guarantee (other than as a co-obligor of the Equistar Assumed
Debt so long as the Equistar Assumed Debt is not considered Indebtedness of the
Company pursuant to the definition thereof) by the Company or any Restricted
Subsidiary of any Indebtedness of the Subsidiary being so designated shall be
deemed an "Incurrence" of such Indebtedness and an "Investment" by the Company
or such Restricted Subsidiary (or both, if applicable) at the time of such
designation,
(b) either (i) the Subsidiary to be so designated has total assets of
$1,000 or less or (ii) if such Subsidiary has assets greater than $1,000, such
designation would be permitted under Section 4.07,
(c) if applicable, the Investment and the incurrence of Indebtedness
referred to in clause (a) of this proviso would be permitted under Section 4.06
and Section 4.07 and
27
(d) in the case of any Subsidiary that is a Joint Venture as of the
date of its designation as an Unrestricted Subsidiary, such Subsidiary has an
aggregate of 15% or more of its outstanding Capital Stock or other voting
interests (other than directors' qualifying shares) held by another Person other
than the Company or any Restricted Subsidiary or any Affiliate of the Company.
Any such designation by the Board of Directors of the Company pursuant
to clause (i) above shall be evidenced to the Trustee by filing with the Trustee
a certified copy of the Board Resolution giving effect to such designation and
an Officer's Certificate certifying that such designation complied with the
foregoing conditions and was permitted by Section 4.06 and Section 4.07.
If (i) at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements of clause (d) (because the Company has acquired more than
85% of the outstanding Capital Stock or other voting interests of any Subsidiary
that was a Joint Venture on the date of its designation as an Unrestricted
Subsidiary), or (ii) at any time the Company or any Restricted Subsidiary
Guarantees any Indebtedness of such Unrestricted Subsidiary or makes any other
Investment in such Unrestricted Subsidiary and such incurrence of Indebtedness
or Investment would not be permitted under Section 4.06 and Section 4.07 it
shall thereafter cease to be an Unrestricted Subsidiary for purposes of the
Indenture and any Indebtedness of such Subsidiary shall be deemed to be incurred
by a Restricted Subsidiary of the Company as of such date (and, if such
Indebtedness is not permitted to be incurred as of such date under Section 4.06,
the Company shall be in default of such covenant). The Board of Directors of the
Company may at any time designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that such designation shall be deemed to be an incurrence
of Indebtedness by a Restricted Subsidiary of the Company of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation shall be
permitted only if (i) such Indebtedness is permitted under Section 4.06 and (ii)
no Default or Event of Default would be in existence following such designation.
"U.S. Government Obligations" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable at the issuer's option.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person all the outstanding Equity Interests of which (other
than
28
directors' qualifying shares) shall at the time be owned by such Person or by
one or more Wholly Owned Restricted Subsidiaries of such Person or by such
Person and one or more Wholly Owned Restricted Subsidiaries of such Person.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such
Person all the outstanding Equity Interests of which (other than directors'
qualifying shares) shall at the time be owned by such Person or by one or more
Wholly Owned Subsidiaries of such Person or by such Person and one or more
Wholly Owned Subsidiaries of such Person.
Section 1.02. Other Definitions.
Defined
Term in Section
Acceleration Notice 6.02
Act 1.08
Affiliate Transaction 4.10
Agent Members 3.13
Asset Sale Offer 4.09
Authentication Order 3.03
Change of Control Offer 4.14
Change of Control Payment 4.14
Change of Control Payment Date 4.14
Covenant Defeasance 12.03
Defaulted Interest 3.07
DTC 2.03
Event of Default 6.01
Excess Proceeds 4.09
Expiration Date 1.08
Global Notes 2.01
Guaranteed Indebtedness 4.13
incur 4.06
Legal Defeasance 12.02
Offshore Global Note 2.01
Offshore Note Exchange Date 2.01
Offshore Physical Note 2.01
Permanent Offshore Global Note 2.01
Physical Notes 2.01
Place of Payment 3.01
Plan Participants 4.07
Private Placement Legend 2.03
Redemption Amount 10.01
redemption date 13.01
Regular Record Date 3.01
Restricted Payment 4.07
Successor Company 5.01
Subordinated Debt 4.07
29
Defined
Term in Section
Temporary Offshore Global Note 2.01
U.S. Global Notes 2.01
U.S. Physical Notes 2.01
Section 1.03. Rules of Construction. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Indenture have the meanings assigned to them
in this Indenture;
(b) "or" is not exclusive;
(c) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP and, unless expressly provided
otherwise, all determinations and computations made pursuant to any provision
hereof shall be made in accordance with GAAP; provided that references to any
Person and its Restricted Subsidiaries on a consolidated basis, and any
calculations of amounts with respect to any Person and its Restricted
Subsidiaries on a consolidated basis, shall refer to such Person and all its
Restricted Subsidiaries, whether or not such Restricted Subsidiaries would be
accounted for as consolidated subsidiaries on such Person's financial statements
prepared in accordance with GAAP;
(d) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision;
(e) all references to "$" or "dollars" shall refer to the lawful currency
of the United States of America;
(f) the words "include," "included" and "including" as used herein shall be
deemed in each case to be followed by the phrase "without limitation," if not
expressly followed by such phrase or the phrase "but not limited to";
(g) words in the singular include the plural, and words in the plural
include the singular; and
(h) any reference to a Section or Article refers to such Section or Article
of this Indenture unless otherwise indicated.
Section 1.04. Incorporation by Reference of TIA. Whenever this Indenture
refers to a provision of the TIA, the provision is incorporated by reference in
and made a part of this Indenture. This Indenture is subject to the mandatory
provisions of the TIA, which are incorporated by reference in and made a part of
this Indenture. Any terms incorporated by reference in this Indenture that are
defined by the TIA, defined by any TIA reference to another statute or defined
by SEC rule under the TIA, have the
30
meanings so assigned to them therein. The following TIA terms have the following
meanings:
"indenture securities" means the Notes.
"indenture security holder" means a Holder or Noteholders.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company, any Subsidiary
Guarantor and any other obligor on the indenture securities.
Section 1.05. Conflict with TIA. If any provision hereof limits, qualifies
or conflicts with a provision of the TIA that is required under the TIA to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the TIA that
may be so modified or excluded, the latter provision shall be deemed (a) to
apply to this Indenture as so modified or (b) to be excluded, as the case may
be.
Section 1.06. Compliance Certificates and Opinions. Upon any application or
request by the Company or by any other obligor upon the Notes to the Trustee to
take any action under any provision of this Indenture, the Company or such other
obligor upon the Notes, as the case may be, shall furnish to the Trustee such
certificates and opinions as may be required under the TIA. Each such
certificate or opinion shall be given in the form of one or more Officer's
Certificates, if to be given by an Officer, or an Opinion of Counsel, if to be
given by counsel, and shall comply with the requirements of the TIA and any
other requirements set forth in this Indenture. Notwithstanding the foregoing,
in the case of any such request or application as to which the furnishing of any
Officer's Certificate or Opinion of Counsel is specifically required by any
provision of this Indenture relating to such particular request or application,
no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (except for certificates provided for in
Section 4.05) shall include:
(a) a statement that the individual signing such certificate or opinion has
read such covenant or condition and the definitions herein relating thereto;
(b) 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;
(c) a statement that, in the opinion of such individual, he or she made
such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
31
(d) a statement as to whether, in the opinion of such individual, such
condition or covenant has been complied with.
Section 1.07. Form of Documents Delivered to Trustee. In any case where
several matters are required to be certified by, or covered by an opinion of,
any specified Person, it is not necessary that all such matters be certified by,
or covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an Officer may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such Officer knows that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or opinion of counsel may
be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an Officer or Officers to the effect that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.08. Acts of Noteholders; Record Dates. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee, and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments. Proof of execution
of any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Indenture and (subject to Section 7.01)
conclusive in favor of the Trustee, the Company and any other obligor upon the
Notes, if made in the manner provided in this Section 1.08.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by
the certificate of any notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
an officer of a corporation or a member of a partnership or other entity, on
behalf of such corporation or partnership or other entity, such certificate or
affidavit shall also constitute sufficient proof of such Person's authority. The
fact and date of the execution
32
of any such instrument or writing, or the authority of the person executing the
same, may also be proved in any other manner that the Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Note shall bind the Holder of every Note
issued upon the transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done or suffered to be done by the Trustee, the Company or
any other obligor on the Notes in reliance thereon, whether or not notation of
such action is made upon such Note.
(e) (i) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes entitled to give, make or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given, made or taken by
Holders, provided that the Company may not set a record date for, and the
provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in Section
1.08(e)(ii). If any record date is set pursuant to this paragraph, the Holders
of Outstanding Notes on such record date (or their duly designated proxies), and
no other Holders, shall be entitled to take the relevant action, whether or not
such Persons remain Holders after such record date; provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Notes on such record date. Nothing in this paragraph shall be construed to
prevent the Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be canceled and of no effect), and nothing in this paragraph shall be construed
to render ineffective any action taken by Holders of the requisite principal
amount of Outstanding Notes on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, at its own expense,
shall cause notice of such record date, the proposed action by Holders and the
applicable Expiration Date to be given to the Trustee in writing and to each
Holder in the manner set forth in Section 1.10.
(ii) The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Notes entitled to join in the giving or
making of (w) any Notice of Default, (x) any declaration of acceleration
referred to in Section 6.02, (y) any request to institute proceedings referred
to in Section 6.06(b) or (z) any direction referred to in Section 6.05, in each
case with respect to Notes. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Notes on such record date, and no other
Holders, shall be entitled to join in such notice, declaration, request or
direction, whether or not such Holders remain Holders after such record date;
provided that no such action shall be effective hereunder unless taken on or
prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Notes on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be canceled and of no effect), and
33
nothing in this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite principal amount of Outstanding Notes on the
date such action is taken. Promptly after any record date is set pursuant to
this paragraph, the Trustee, at the expense of the Company, shall cause notice
of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder in the
manner set forth in Section 1.10.
(iii) With respect to any record date set pursuant to this Section 1.08,
the party hereto that sets such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the Company or the
Trustee, whichever such party is not setting a record date pursuant to this
Section 1.08(e) in writing, and to each Holder in the manner set forth in
Section 1.10, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto that set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
(iv) Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Note may do so with regard to
all or any part of the principal amount of such Note or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
Section 1.09. Notices, Etc., to Trustee and Company. Any request, demand,
authorization, direction, notice, consent, waiver or Act of Holders or other
document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with,
(a) the Trustee by any Holder or by the Company or any other obligor upon
the Notes shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at the Corporate Trust
Office (telephone: (212) 815-6286; facsimile: (212) 815-5915), or at any other
address furnished in writing to the Company by the Trustee, or
(b) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder if in writing and delivered in person or mailed,
first-class postage prepaid, to the Company at One Houston Center, Suite 700,
1221 McKinney, Houston, Texas 77010, Attention: General Counsel (facsimile:
(713) 309-2143), with copies to Baker Botts LLP at 910 Louisiana, Houston, Texas
77002, Attention: Stephen A. Massad, Esq. (facsimile: (713) 229-1522), or at any
other address previously furnished in writing to the Trustee by the Company.
Section 1.10. Notices to Holders; Waivers. Where this Indenture provides
for notice to Holders of any event, such notice shall be deemed to have been
given upon the mailing by first class mail, postage prepaid, of such notices to
Holders at their registered
34
addresses as recorded in the Register, not later than the latest date, and not
earlier than the earliest date, prescribed herein for the giving of such notice.
In any case where notice to Holders is given by mail, neither the failure to
mail such notice, nor any defect in any notice so mailed, to any particular
Holder shall affect the sufficiency of such notice with respect to other
Holders.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case, by reason of the suspension of regular mail service, or by reason
of any other cause, it shall be impossible to mail notice of any event as
required by any provision of this Indenture, then such notification as shall be
made with the approval of the Trustee (such approval not to be unreasonably
withheld) shall constitute a sufficient notification for every purpose
hereunder.
Section 1.11. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 1.12. Successors and Assigns. All covenants and agreements in this
Indenture by the Company shall bind its respective successors and assigns,
whether so expressed or not.
Section 1.13. Separability Clause. In case any provision in this Indenture
or in 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.
Section 1.14. Benefits of Indenture. Nothing in this Indenture or in the
Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, any Paying Agent and the Holders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
Section 1.15. Governing Law. THIS INDENTURE, THE NOTES AND THE SUBSIDIARY
GUARANTEES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY PRINCIPLES OF CONFLICT OF
LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION WOULD
BE REQUIRED THEREBY. TO THE EXTENT PERMITTED BY LAW, THE TRUSTEE, THE COMPANY,
THE SUBSIDIARY GUARANTORS, ANY OTHER OBLIGORS IN RESPECT OF THE NOTES AND (BY
THEIR ACCEPTANCE OF THE NOTES) THE HOLDERS, AGREE TO SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF ANY UNITED STATES FEDERAL OR STATE COURT LOCATED IN THE BOROUGH
OF MANHATTAN, IN THE CITY OF NEW YORK
35
IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE
NOTES.
Section 1.16. Legal Holidays. In any case where any Interest Payment Date,
Redemption Date or Stated Maturity of any Note shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Notes) payment
of interest and Liquidated Damages, if any, or principal and premium (if any)
need not be made on such date, but may be made on the next succeeding Business
Day with the same force and effect as if made on the Interest Payment Date or
Redemption Date, or at the Stated Maturity.
Section 1.17. No Personal Liability of Directors, Officers, Employees,
Incorporators and Stockholders. No director, officer, employee, incorporator,
shareholder or other holder of Equity Interests of the Company or the Subsidiary
Guarantors, as such, shall have any liability for any obligations of the Company
or the Subsidiary Guarantors under the Notes, the Subsidiary Guarantees, the
Indenture or for any claim based on, in respect of, or by reason of, such
obligations or their creation. Each Holder of Notes by accepting a Note waives
and releases all such liability. The waiver and release are part of the
consideration for the issuance of the Notes.
Section 1.18. Exhibits and Schedules. All exhibits and schedules attached
hereto are by this reference made a part hereof with the same effect as if
herein set forth in full.
Section 1.19. Counterparts. This Indenture may be executed in any number of
counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.
ARTICLE 2
Note Forms
Section 2.01. Forms Generally. The Notes and the Trustee's certificate of
authentication relating thereto shall be in substantially the forms set forth,
or referenced, in Exhibit A annexed hereto and in this Article 2. The Notes may
have such appropriate insertions, omissions, substitutions, notations, legends,
endorsements, identifications and other variations as are required or permitted
by law, stock exchange rule or depository rule or usage, the certificate of
incorporation, bylaws or other similar governing instruments of the Company,
agreements to which the Company is subject, if any, or other customary usage, or
as may consistently herewith be determined by the Officers of the Company
executing such Notes, as evidenced by such execution (provided always that any
such notation, legend, endorsement, identification or variation is in a form
acceptable to the Company). Each Note shall be dated the date of its
authentication.
Initial Notes and any Additional Notes offered and sold in reliance on
Rule 144A under the Securities Act shall be issued initially in the form of one
or more permanent global Notes in substantially the form set forth in Exhibit A
and shall contain the legends
36
set forth in Section 2.03(a) and (b) (the "U.S. Global Notes"), registered in
the name of the nominee of the Depositary, deposited with the Trustee, as
custodian for the Depositary or its nominee, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the U.S. Global Notes may from time to time be increased or decreased
by adjustments made on the records of the Trustee, as custodian for the
Depositary or its nominee, as provided in Sections 3.13 and 3.14.
Initial Notes and any Initial Additional Notes offered and sold in offshore
transactions in reliance on Regulation S under the Securities Act shall be
issued initially in the form of one or more temporary global Notes in
substantially the form set forth in Exhibit A and containing each of the legends
set forth in Section 2.03 (the "Temporary Offshore Global Note"), registered in
the name of the nominee of the Depositary, deposited with the Trustee, as
custodian for the Depositary or its nominee, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. At any time following
termination of the Restricted Period (the "Offshore Note Exchange Date"), upon
receipt by the Trustee and the Company of a certificate substantially in the
form set forth in Exhibit C hereto, one or more permanent global Notes
substantially in the form of Exhibit A hereto and containing the legend set
forth in Section 2.03(b) (the "Permanent Offshore Global Note," and together
with the Temporary Offshore Global Note, the "Offshore Global Note") duly
executed by the Company and authenticated by the Trustee as hereinafter provided
shall be deposited with the Trustee, as custodian for the Depositary, and the
Registrar shall reflect on its books and records the date and a decrease in the
principal amount of the Temporary Offshore Global Note in an amount equal to the
principal amount of the beneficial interest in the Temporary Offshore Global
Note transferred. Prior to the Offshore Note Exchange Date and receipt of the
certificate referred to above, beneficial interests in a Temporary Offshore
Global Note may be held only through Euroclear or Clearstream. The aggregate
principal amount of the Offshore Global Note may from time to time be increased
or decreased by adjustments made on the records of the Trustee, as custodian for
the nominee of the Depositary for the Offshore Global Note, as provided in
Sections 3.13 and 3.14.
Initial Notes and any Initial Additional Notes issued pursuant to Section
3.05 and Section 3.13 in exchange for or upon transfer of beneficial interests
in the U.S. Global Note or Offshore Global Note shall be in the form of
permanent certificated Notes in substantially the form set forth in Exhibit A
containing the Private Placement Legend as set forth in Section 2.03 (the "U.S.
Physical Notes"), or in the form of permanent certificated Notes substantially
in the form set forth in Exhibit A (the "Offshore Physical Notes"),
respectively, as hereinafter provided. No Offshore Physical Notes may be issued
until expiration of the applicable Restricted Period and receipt by the Company
and the Trustee from the (x) proposed transferor of a certificate substantially
in the form set forth in Exhibit D or (y) holder of a beneficial interest being
exchanged, of certification that such holder is a non-U.S. person (within the
meaning of Regulation S under the Securities Act) or a U.S. person who acquired
such interest in a transaction exempt from the registration requirements of the
Securities Act (in which case a U.S. Physical Note shall be issued).
37
The U.S. Physical Notes and the Offshore Physical Notes, together with any
other certificated notes in registered form, are sometimes collectively referred
to as the "Physical Notes." The U.S. Global Notes and the Offshore Global Notes,
together with any other global notes in registered form, are sometimes
collectively referred to as the "Global Notes."
Initial Notes and Initial Additional Notes offered and sold in reliance on
any exemption under the Securities Act other than Regulation S and Rule 144A
thereunder shall be issued in the form of permanent certificated Notes
substantially in the form set forth in Exhibit A and shall contain the Private
Placement Legend as set forth in Section 2.03.
Exchange Notes shall be issued substantially in the form set forth in
Exhibit A and, subject to Section 3.13, shall be in the form of one or more
Global Notes.
Section 2.02. Form of Trustee' Certificate of Authentication. The Trustee's
certificate of authentication shall be in substantially the following form:
This is one of the Notes referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
Dated: __________ By: __________________________
Authorized Signatory
If an appointment of an Authenticating Agent is made pursuant to Section
7.15, the Notes may have endorsed thereon, in lieu of the Trustee's certificate
of authentication, an alternative certificate of authentication in the following
form:
This is one of the Notes referred to in the within-mentioned Indenture.
THE BANK OF NEW YORK,
As Trustee
By _____________________________
As Authenticating Agent
By _____________________________
Authorized Signatory
Dated:
Section 2.03. Restrictive Legends. (a) Except as set forth in Section
3.14(l), unless and until (i) an Initial Note or any Initial Additional Note is
sold pursuant to an effective registration statement, whether pursuant to the
Registration Rights Agreement or otherwise or (ii) an Initial Note or any
Initial Additional Note is exchanged for an
38
Exchange Note in an Exchange Offer pursuant to an effective Exchange Offer
Registration Statement pursuant to the Registration Rights Agreement, (A) each
U.S. Global Note and U.S. Physical Note shall bear the following legend set
forth below (the "Private Placement Legend") on the face thereof and (B) each
Temporary Offshore Global Note shall bear the Private Placement Legend on the
face thereof until the Offshore Note Exchange Date and receipt by the Company
and the Trustee of a certificate substantially in the form provided in Exhibit C
with respect to the entire principal amount of such Temporary Offshore Global
Note:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS
ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER
(1) REPRESENTS THAT
(A) IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A "QUALIFIED
INSTITUTIONAL BUYER" (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES
ACT) AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH
SUCH ACCOUNT,
(B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (WITHIN THE MEANING
OF RULE 501(a) (1), (2), (3) OR (7) UNDER THE SECURITIES ACT) (AN
"INSTITUTIONAL ACCREDITED INVESTOR") OR
(C) IT IS NOT A U.S. PERSON (WITHIN THE MEANING OF REGULATION S UNDER
THE SECURITIES ACT) AND
(2) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL NOT OFFER, SELL,
PLEDGE OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT
IN ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES AND ONLY
(A) TO THE COMPANY,
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE
UNDER THE SECURITIES ACT,
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
UNDER THE SECURITIES ACT,
(D) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT,
39
(E) IN A PRINCIPAL AMOUNT OF NOT LESS THAN $100,000, TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO
THE TRUSTEE A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY
BE OBTAINED FROM THE TRUSTEE) RELATING TO THE RESTRICTIONS ON TRANSFER OF
THIS NOTE, OR
(F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(C) ABOVE OR
(2)(D) ABOVE, A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE
OBTAINED FROM THE TRUSTEE) MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE
REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(E) OR (F) ABOVE, THE COMPANY
RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS,
CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO
DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE
AS TO THE AVAILABILITY OF ANY RULE 144 EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.
(b) Each Global Note, whether or not an Initial Note or Additional Note,
shall also bear the following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR
THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTIONS 3.13 AND 3.14 OF THE INDENTURE.
40
(c) Each Temporary Offshore Global Note shall bear the following legend on
the face thereof:
THIS NOTE IS A TEMPORARY GLOBAL NOTE. PRIOR TO THE EXPIRATION OF THE
RESTRICTED PERIOD APPLICABLE HERETO, BENEFICIAL INTERESTS HEREIN MAY NOT BE HELD
BY ANY PERSON OTHER THAN (1) A NON-U.S. PERSON OR (2) A U.S. PERSON WHO
PURCHASED SUCH INTEREST IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") PURSUANT TO RULE 144A
THEREUNDER. BENEFICIAL INTERESTS HEREIN ARE NOT EXCHANGEABLE FOR PHYSICAL NOTES
OTHER THAN A PERMANENT GLOBAL NOTE IN ACCORDANCE WITH THE TERMS OF THE
INDENTURE. TERMS IN THIS LEGEND ARE USED AS USED IN REGULATION S UNDER THE
SECURITIES ACT.
ARTICLE 3
The Notes
Section 3.01. Title and Terms. The aggregate principal amount of Notes
that may be authenticated and delivered and Outstanding under this Indenture is
initially limited to $393,000,000, but may be increased, subject to compliance
with the covenants contained in Article 4 below and the conditions set forth in
Section 3.03, and except as may be limited by applicable law. The Initial Notes
will be issued in an aggregate principal amount of $393,000,000. All the
Original Notes shall vote and consent together on all matters as one class, and
none of the Original Notes will have the right to vote or consent as a class
separate from one another on any matter. Subject to the conditions set forth in
Section 3.03 and the covenants contained in Article 4 below, the Company may
issue Additional Notes hereunder. Additional Notes (including any Exchange Notes
issued in exchange therefor) shall vote (or consent) as a class with the other
Notes and otherwise be treated as Notes for all purposes of this Indenture.
The Notes shall be known and designated as the "9 1/2% Senior Secured
Notes, Due 2008" of the Company. The final Stated Maturity of the Notes shall be
December 15, 2008. Interest on the Outstanding principal amount of Notes will
accrue, subject to Section 3.11, at the rate of 9 1/2% per annum and will be
payable semiannually in arrears on June 15 and December 15 in each year,
commencing on June 15, 2002, to Holders of record at the close of business on
the immediately preceding June 1 and December 1, respectively (each such June 1
and December 1 a "Regular Record Date"). Interest on the Original Notes will
accrue from the most recent date to which interest has been paid or duly
provided for or, if no interest has been paid, from December 4, 2001, and
interest on any Additional Notes (and Exchange Notes issued in exchange
therefor) will accrue from the most recent date to which interest has been paid
or duly provided for or, if no interest has been paid on such Additional Notes,
from the date of issuance of such Additional Notes; provided that if any Note is
surrendered for exchange on or after a record date for an Interest Payment Date
that will occur on or after the date of such exchange, interest on the Note
received in exchange thereof will accrue from the date of
41
such Interest Payment Date. The Company will pay interest on overdue principal
and, to the extent lawful, on overdue installments of interest and Liquidated
Damages, if any, at a rate of 1% per annum in excess of the interest rate
referred to above.
The principal of, and premium, if any, and interest and Liquidated Damages,
if any, on the Notes shall be payable at the Corporate Trust Office or at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, The City of New York (each, a "Place of Payment") in the manner
provided in Section 4.01(b); provided, however, that, under the circumstances
set forth in Section 4.01(b), payment of interest and Liquidated Damages on a
Note may be made by wire transfer of immediately available funds to the account
specified by the Holder of a Global Note or by check mailed to the address of
the Person entitled thereto as such address shall appear in the Register.
Section 3.02. Denominations. The Notes shall be issuable only in registered
form without coupons and only in denominations of $1,000 and any integral
multiple thereof.
Section 3.03. Execution, Authentication and Delivery and Dating. The Notes
shall be executed on behalf of the Company by an Officer of such Company. The
signature of such Officer on the Notes may be manual or facsimile.
Notes bearing the manual or facsimile signature of an individual who was at
any time a proper Officer of the Company shall bind the Company, notwithstanding
that such individual has ceased to hold such office prior to the authentication
and delivery of such Notes or did not hold such office at the date of such
Notes.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Notes executed by the Company to the Trustee
for authentication; and the Trustee shall authenticate and deliver (i) Initial
Notes for original issue in the aggregate principal amount not to exceed
$393,000,000 and (ii) Additional Notes from time to time for original issue in
aggregate principal amounts specified by the Company and (iii) Exchange Notes
from time to time for issue in exchange for a like principal amount of Initial
Notes or Initial Additional Notes, in each case specified in clauses (i) through
(iii) above, upon a written order of the Company in the form of an Officer's
Certificate (an "Authentication Order"), and in the case of clause (ii), upon
receipt by the Trustee of an Opinion of Counsel confirming that the Holders of
the Outstanding Notes will be subject to federal income tax in the same amounts,
in the same manner and at the same times as would have been the case if such
Additional Notes were not issued. Such Officer's Certificates 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, Additional Notes or
Exchange Notes, that, in the case of Additional Notes, (x) the issuance of such
Notes does not contravene any provision of Article 4 of this Indenture and (y)
after giving effect to such issuance of Additional Notes and the application of
the use of proceeds therefrom, the aggregate principal amount of Notes
outstanding does not exceed the amount permitted to be equally and ratably
secured under the Existing Credit Facility without causing a default thereunder,
whether the Notes are to be issued as one or more Global Notes or Physical
Notes, the
42
name or names of the Initial Holder or Holders and such other information as the
Company may include or the Trustee may reasonably request.
All Notes shall be dated the date of their authentication.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for herein executed by the
Trustee by manual signature, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
Section 3.04. Temporary Notes. Until definitive Notes are ready for
delivery, the Company may prepare and upon receipt of an Authentication Order
the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes. If temporary Notes are
issued, the Company will cause definitive Notes to be prepared without
unreasonable delay. After the preparation of definitive Notes, the temporary
Notes shall be exchangeable for definitive Notes upon surrender of the temporary
Notes at the office or agency of the Company in a Place of Payment, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Notes, the Company shall execute and upon receipt of an Authentication
Order the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Notes of authorized denominations. Until so
exchanged the temporary Notes shall in all respects be entitled to the same
benefits under this Indenture as definitive Notes of the same series and tenor.
Section 3.05. Registration, Registration of Transfer and Exchange. The
Company shall cause to be kept at the Corporate Trust Office of the Trustee a
register (the register maintained in such office and in any other office or
agency of the Company in a Place of Payment being herein sometimes collectively
referred to as the "Register") in which, subject to such reasonable regulations
as it may prescribe, the Company shall provide for the registration of Notes and
of transfers of Notes. The Trustee is hereby appointed "Registrar" for the
purpose of registering Notes and transfers of Notes as herein provided.
Upon surrender for transfer of any Note at the office or agency of the
Company in a Place of Payment, in compliance with all applicable requirements of
this Indenture and applicable law, the Company shall execute, and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes, of any authorized denominations and of a
like aggregate principal amount.
At the option of the Holder, Notes may be exchanged for other Notes, of
any authorized denominations and of a like tenor and aggregate principal amount,
upon surrender of the Notes to be exchanged at such office or agency. Whenever
any Notes are so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Notes that the Holder making the
exchange is entitled to receive; provided that no exchange of Initial Notes or
Initial Additional Notes for Exchange Notes shall occur until an Exchange Offer
Registration Statement shall have
43
been declared effective by the SEC and the Trustee shall have received an
Officer's Certificate confirming that the Exchange Offer Registration Statement
has been declared effective by the SEC and an exchange offer thereunder has been
consummated. The Initial Notes or Additional Notes to be exchanged for the
Exchange Notes shall be canceled by the Trustee.
All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall (if so required by the Company or the Registrar) 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 such Holder's attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange or redemption of Notes, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Notes under this
Section 3.05.
Section 3.06. Mutilated, Destroyed, Lost and Stolen Notes. If (a) any
mutilated Note is surrendered to the Trustee, or the Company and the Trustee
receive evidence to their satisfaction of the destruction, loss or theft of any
Note, and (b) there is delivered to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless, then, in the
absence of notice to the Company or the Trustee that such Note has been acquired
by a bona fide purchaser, the Company shall execute and upon receipt of an
Authentication Order the Trustee shall authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Note, a new Note of
like tenor and principal amount, bearing a number not contemporaneously
Outstanding.
In case any such mutilated, destroyed, lost or stolen Note has become or is
about to become due and payable, the Company in its discretion may, instead of
issuing a new Note, pay such Note.
Upon the issuance of any new Note under this Section 3.06, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section 3.06 in lieu of any
mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and ratably with
any and all other Notes duly issued hereunder.
44
The provisions of this Section 3.06 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.
Section 3.07. Payment of Interest Rights Preserved. Interest and Liquidated
Damages on any Note that is payable, and is punctually paid or duly provided
for, on any Interest Payment Date shall be paid to the Person in whose name that
Note (or one or more Predecessor Notes) is registered at the close of business
on the Regular Record Date for such interest and Liquidated Damages specified in
Section 3.01.
Any interest and Liquidated Damages on any Note that is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the
registered Holder on the relevant Regular Record Date by virtue of having been
such Holder; and such Defaulted Interest shall be paid by the Company, as
provided in 3.07(a) or 3.07(b) below:
(a) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Notes (or their respective Predecessor Notes) are
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest, which shall be fixed in the following manner. The
Company shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Note and the date of the proposed payment, and at
the same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements reasonably satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as provided in this Section 3.07(a). Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest which
shall be not more than 15 nor less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify the
Company of such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted Interest,
the amount thereof and the Special Record Date and payment date therefor to be
mailed, first class postage prepaid, to each Holder at such Holder's address as
it appears in the Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the Special
Record Date therefor having been so mailed, such Defaulted Interest shall be
paid to the Persons in whose names the Notes (or their respective Predecessor
Notes) are registered on such Special Record Date and shall no longer be payable
pursuant to the following 3.07(b).
(b) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Notes may be listed, and upon such notice as may be required by
such exchange, if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this clause (b), such payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 3.07, each Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any
45
other Note shall carry the rights to interest (including any Liquidated Damages)
accrued and unpaid, and to accrue, that were carried by such other Note.
Section 3.08. Persons Deemed Owners. Prior to due presentment of a Note for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Note is registered as the
owner of such Note for the purpose of receiving payment of principal of (and
premium, if any, on) and (subject to Section 3.07) interest and Liquidated
Damages, if any, on such Note and for all other purposes whatsoever, whether or
not such Note be overdue, and none of the Company, the Subsidiary Guarantors,
the Trustee or any agent of the Company, the Subsidiary Guarantors or the
Trustee shall be affected by notice to the contrary.
Section 3.09. Cancellation. All Notes surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and, if not already canceled,
shall be promptly canceled by it. The Company may at any time deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder that the Company may have acquired in any manner whatsoever, and all
Notes so delivered shall be promptly canceled by the Trustee. No Notes shall be
authenticated in lieu of or in exchange for any Notes canceled as provided in
this Section 3.09, except as expressly permitted by this Indenture. All canceled
Notes held by the Trustee shall be disposed of in accordance with the Trustee's
customary procedures.
Section 3.10. Computation of Interest. Interest on the Notes shall be
computed on the basis of a 360-day year of twelve 30-day months.
Section 3.11. Payment of Liquidated Damages. (a) Under certain
circumstances the Company will be obligated to pay certain Liquidated Damages to
the Holders of certain Initial Notes, as more particularly set forth in such
Initial Notes.
(b) Under certain circumstances the Company may be obligated to pay certain
Liquidated Damages to the Holders of certain Initial Additional Notes, as may be
more particularly set forth in such Initial Additional Notes.
Section 3.12. CUSIP Numbers. The Company in issuing the Notes may use
"CUSIP" or "CINS" numbers (if then generally in use) in addition to serial
numbers, and, if so, the Trustee shall use such "CUSIP" or "CINS" numbers in
addition to serial numbers in notices of redemption, repurchase or other notices
to Holders as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness of such "CUSIP" or "CINS"
numbers either as printed on the Notes or as contained in any notice of a
redemption or repurchase and that reliance may be placed only on the serial or
other identification numbers printed on the Notes, and any such redemption or
repurchase shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the "CUSIP" or
"CINS" numbers.
46
Section 3.13. Book-entry Provisions for Global Notes.
(a) Each Global Note initially shall (i) be registered in the name of the
Depositary for such Global Notes or the nominee of such Depositary, (ii) be
delivered to the Trustee as custodian for such Depositary and (iii) to the
extent relevant thereto, bear legends as set forth in Section 2.03. None of the
Company or the Subsidiary Guarantors, nor any of their agents shall have any
responsibility or liability for any aspect of the records relating to, or
payments made on account of beneficial ownership interests of, a Global Note, or
for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
Members of, or participants in, the Depositary ("Agent Members") shall have
no rights under this Indenture with respect to any Global Note, and the
Depositary may be treated by the Company, the Subsidiary Guarantors, the Trustee
and any agent of the Company, the Subsidiary Guarantors or the Trustee as the
absolute owner of such Global Note for all purposes whatsoever. Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Subsidiary
Guarantors, the Trustee or any agent of the Company, the Subsidiary Guarantors
or the Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a beneficial owner of any Note. The registered Holder
of a Global Note may grant proxies and otherwise authorize any person, including
Agent Members and persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under this Indenture or the Notes.
(b) Interests of beneficial owners in a Global Note may be transferred in
accordance with the applicable rules and procedures of the Depositary and the
provisions of Section 3.14. Transfers of a Global Note shall be limited to
transfers of such Global Note in whole, but not in part, to the Depositary, its
successors or their respective nominees, except (i) as required in connection
with transfers of interests therein pursuant to Section 3.14(b) or 3.14(g) or as
may be required by the Company or the Trustee in connection with transfers
pursuant to Section 3.14(i), and (ii) that U.S. Physical Notes or, subject to
Section 3.14(h), Offshore Physical Notes shall be transferred to all beneficial
owners in exchange for their beneficial interests in the U.S. Global Note or the
Offshore Global Note, respectively, in the event that (A) the Depositary
notifies the Company that it is unwilling or unable to continue as Depositary
for the applicable Global Note and a successor depositary is not appointed by
the Company within 90 days or (B) an Event of Default has occurred and is
continuing and the Registrar has received a request from the Depositary. In
addition, beneficial interests in a Global Note may be exchanged for Physical
Notes upon request but only upon at least 20 days' prior written notice given to
the Trustee by or on behalf of the Depository in accordance with customary
procedures. In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Note to beneficial owners for Physical Notes
pursuant to this Section 3.13(b), the Registrar shall record on its books and
records (and make a notation on the Global Note of) the date and a decrease in
the principal amount of such Global Note in an amount equal to the beneficial
interest in the Global Note being transferred, and the Company shall execute,
and the Trustee shall authenticate and deliver, one or more Physical Notes of
like tenor and principal amount of authorized
47
denominations. In connection with a transfer of an entire Global Note to
beneficial owners pursuant to this paragraph (b), the applicable Global Note
shall be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall authenticate and deliver, to each
beneficial owner identified by the Depositary in exchange for its beneficial
interest in the applicable Global Note, an equal aggregate principal amount at
maturity of U.S. Physical Notes (in the case of the U.S. Global Note) or
Offshore Physical Notes (in the case of the Offshore Global Note), as the case
may be, of authorized denominations.
(c) Any beneficial interest in one of the Global Notes that is transferred
to a person who takes delivery in the form of an interest in another Global Note
will, upon transfer, cease to be an interest in such Global Note and become an
interest in the other Global Note and, accordingly, will thereafter be subject
to all transfer restrictions, if any, and other procedures applicable to
beneficial interests in such other Global Note for as long as it remains such an
interest.
(d) The Company, the Subsidiary Guarantors, any other obligor upon the
Notes or the Trustee, in the discretion of any of them, may treat as the Act of
a Holder any instrument or writing of any Person that is identified by the
Depositary as the owner of a beneficial interest in the Global Note, provided
that the fact and date of the execution of such instrument or writing is proved
in accordance with Section 1.08(b).
(e) Any U.S. Physical Note delivered in exchange for an interest in the
U.S. Global Note pursuant to paragraph (b) of this Section shall, except as
otherwise provided in Section 3.14, bear the Private Placement Legend.
Section 3.14. Transfer Provisions. Unless and until (i) an Initial Note or
any Initial Additional Note is sold pursuant to an effective registration
statement, whether pursuant to the Registration Rights Agreement or otherwise,
(ii) an Initial Note or any Initial Additional Note is exchanged for an Exchange
Note in the Exchange Offer pursuant to an effective Registration Statement, or
(iii) the Resale Restriction Termination Date has occurred with respect to an
Initial Note or any Initial Additional Note and such Note is not then held by an
Affiliate of the Company, the following provisions shall apply with respect to
such Initial Note or Initial Additional Note:
(a) General. The provisions of this Section 3.14 shall apply to all
transfers involving any Physical Note and any beneficial interest in any Global
Note. A Note that is a Restricted Security may not be transferred other than as
provided in this Section 3.14. A beneficial interest in a Global Note that is a
Restricted Security may not be exchanged for a beneficial interest in another
Global Note other than through a transfer in compliance with this Section 3.14.
(b) Transfers to Non-QIB Institutional Accredited Investors. With respect
to the registration of any proposed transfer of a Note that is a Restricted
Security to any Institutional Accredited Investor that is not a QIB,
(I) the Registrar shall register such transfer
48
(i) if it complies with all other applicable requirements of this
Indenture (including Section 3.05 and Section 3.13); and
(ii) the proposed transferee has delivered to the Registrar a
certificate substantially in the form of Exhibit E, and such transfer is in
respect of an aggregate principal amount of Notes of not less than
$100,000; and
(iii) if the proposed transferor is or is acting through an Agent
Member holding a beneficial interest in a Global Note, upon receipt by the
Registrar of written instructions given in accordance with the Depositary's
and the Registrar's procedures; and
(II) the Registrar shall (x) reflect on its books and records (and make a
notation on the relevant Global Note of) the date and a decrease in the
principal amount of the relevant Global Note in an amount equal to the principal
amount of the beneficial interest in the relevant Global Note to be transferred
or (y) cancel the Physical Note so transferred, and the Registrar shall deliver
to the transferee one or more Physical Notes of like tenor and amount.
Each of the Company and the Trustee may require additional opinions,
certifications or other evidence as may be reasonably required to confirm that
any such proposed transfer is being made in compliance with the Securities Act
and applicable state securities laws.
(c) Transfers to QIBs. With respect to the registration of any proposed
transfer of a Note that is a Restricted Security to a QIB,
(I) the Registrar shall register such transfer
(i) if it complies with all other applicable requirements of
this Indenture (including Section 3.05 and Section 3.13); and
(ii) the proposed transferor has checked the box provided for on
the form of such Note stating, or has otherwise certified to the Company
and the Registrar in writing, that the sale has been made in compliance
with the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of such Note stating, or has
otherwise certified to the Company and the Registrar in writing, that it is
purchasing such 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; and
49
(iii) if the proposed transferor or transferee is or is acting through
an Agent Member, upon receipt by the Registrar of written instructions
given in accordance with the Depositary's and the Registrar's procedures;
and
(II) the Registrar shall (a) cancel the Physical Note so transferred or (b)
reflect on its books and records (and make a notation on the relevant Global
Note of) the date and a decrease in the principal amount of such transferor
Global Note, as the case may be, and the Registrar shall (x) reflect on its
books and records (and make a notation on the relevant Global Note of) the date
and an increase in the principal amount of the transferee Global Note or (y)
deliver Physical Notes of like tenor and amount.
(d) Transfers of Interests in the Temporary Offshore Global Notes. With
respect to registration of any proposed transfer of interests in any Temporary
Offshore Global Note,
(I) the Registrar shall register the transfer of any interest in such Note
only
(i) if the proposed transferee is a Non-U.S. Person and the proposed
transferor has delivered to the Registrar a certificate substantially in
the form of Exhibit D hereto and will take delivery in the form of an
interest in the Temporary Offshore Global Note; or
(ii) if the proposed transferee is a QIB and the proposed transferor
has checked the box provided for on the form of Note stating, or has
otherwise certified to the Company and the Registrar in writing, that the
sale has been made in compliance with provisions of Rule 144A to a
transferee who has signed the certification provided for on the form of
Note stating, or has otherwise advised the Company and the Registrar in
writing, that it is purchasing the Note for its own account or an account
with respect to which it exercises sole investment discretion and that it
and any such account is a QIB within the meaning of Rule 144A, and is aware
that the sale to it is being made in reliance on Rule 144A and acknowledges
that it has received such information regarding the 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; and
(iii) upon receipt by the Registrar of written instructions given in
accordance with the Depositary's and the Registrar's procedures; and
(II) the Registrar shall reflect on its books and records (and make a
notation on the relevant Global Note of) the date and an increase in the
principal amount of the transferee Global Note, in an amount equal to the
principal amount of the Temporary Offshore Global Note to be transferred, and
the Registrar shall reflect on its books and records (and make a notation on the
relevant Global Note of) the date and a decrease in the principal amount of the
transferor Temporary Offshore Global Note.
50
(e) Transfers to Non-U.S. Persons. With respect to the registration of any
proposed transfer of a Note that is a Restricted Security to a Non-U.S. Person
(except for any transfer referred to in Section 3.14(d))
(I) the Registrar shall register such transfer:
(i) if it complies with all other applicable requirements of this
Indenture (including Section 3.05 and Section 3.13); and
(ii) if the proposed transfer is to be made prior to the end of the
Restricted Period, upon receipt of a certificate substantially in the form
of Exhibit D hereto from the proposed transferor; and
(iii) if the proposed transfer is to be made after the end of the
Restricted Period and the Note to be transferred is a U.S. Certificated
Note or an interest in the U.S. Global Note, only upon receipt of a
certificate substantially in the form of Exhibit D from the proposed
transferor; and
(iv) if the proposed transferor or transferee is or is acting through
an Agent Member, upon receipt by the Registrar of written instructions in
accordance with the Depositary's and the Registrar's procedures; and
(II) the Registrar shall (a) reflect on its books and records (and make a
notation on the relevant Global Note of) the date and a decrease in the
principal amount of the transferor Global Note in an amount equal to the
principal amount to be transferred or (b) cancel the Physical Notes so
transferred, as the case may be, and the Registrar shall (x) reflect on its
books and records (and make a notation on the relevant Global Note of) the date
and an increase in the principal amount of the transferee Offshore Global Note
or (y) deliver one or more Physical Notes of like tenor and amount.
(f) Transfers pursuant to Rule 144. With respect to the registration of any
proposed transfer of a Note that is a Restricted Security pursuant to the
exemption from registration under the Securities Act provided by Rule 144
thereunder,
(I) the Registrar shall register such transfer
(A) if it complies with all other requirements of this Indenture
(including Section 3.05 and Section 3.13); and
(B) if such transfer is being made by a proposed transferor who has
checked the box provided for on the form of such Note stating, or has
otherwise certified to the Company and the Registrar in writing, that the
sale has been made in compliance with the provisions of Rule 144; and
(C) if the proposed transferor or transferee is or is acting through
an Agent Member, upon receipt by the Registrar of written instructions
given in accordance with the Depositary's and the Registrar's procedures;
and
51
(II) the Registrar shall (a) reflect on its books and records (and make
a notation on the relevant Global Note of) the date and a decrease in the
principal amount of such transferor Global Note in an amount equal to the
principal amount to be transferred or (b) cancel the Physical Note so
transferred and the Registrar shall (x) reflect on its books and records (and
make a notation on the relevant Global Note of) the date and an increase in the
principal amount of the transferee Global Note or (y) the Registrar shall
deliver Physical Notes in like tenor and amount.
Each of the Company and the Trustee may require additional opinions,
certifications or other evidence as may be reasonably required to confirm that
any such proposed transfer is being made in compliance with the Securities Act
and applicable state securities laws.
(g) Transfers to the Company. With respect to the registration of any
proposed transfer of a Note to the Company,
(I) the Registrar shall register such transfer
(A) if it complies with all other requirements of this Indenture
(including Section 3.05 and Section 3.13); and
(B) if such transfer is being made by a proposed transferor who has
checked the box provided for on the form of such Note stating, or has
otherwise certified to the Company and the Registrar in writing, that the
sale has been made to the Company; and
(C) if the proposed transferor is or is acting through an Agent
Member, upon receipt by the Registrar of written instructions given in
accordance with the Depositary's and the Registrar's procedures; and
(II) the Registrar shall (x) reflect on its books and records (and make a
notation on the relevant Global Note of) the date and a decrease in the
principal amount of such transferor Global Note in an amount equal to the
principal amount to be transferred or (y) cancel the Physical Note so
transferred, as the case may be and the Registrar shall deliver Physical Notes
to the Company in like tenor and amount.
(h) Interests in the Offshore Global Note prior to the Offshore Note
Exchange Date. Notwithstanding anything to the contrary contained in this
Indenture, until the Offshore Note Exchange Date occurs and appropriate
certification substantially in the form of Exhibit C is made as provided in
Section 2.01, beneficial interests in the Offshore Global Note may be held only
in or through accounts maintained at the Depositary by Euroclear or Clearstream,
and no person shall be entitled to effect any transfer or exchange that would
result in any such interest being held otherwise than in or through such an
account, and no Physical Notes may be issued in exchange therefor.
(i) Other Transfers. The Registrar shall effect and register, upon receipt
of a written request from the Company to do so, a transfer not otherwise
permitted by this Section 3.14, such registration to be done in accordance with
the otherwise applicable
52
provisions of this Section 3.14, upon the furnishing by the proposed transferor
or transferee of a written opinion of counsel (which opinion and counsel are
satisfactory to the Company and the Trustee) to the effect that, and such other
certifications or evidence as the Company may require to confirm that, the
proposed transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
and otherwise in compliance with applicable state securities laws.
(j) Limitation on Issuance of Physical Notes. No Physical Note shall be
exchanged for a beneficial interest in any Global Note, except in accordance
with Section 3.13 and this Section 3.14.
(k) Execution, Authentication and Delivery of Physical Notes. In any case
in which the Registrar is required to deliver a Physical Note to a transferee or
transferor, the Company shall execute, and the Trustee shall authenticate and
make available for delivery, such Physical Note.
(l) Private Placement Legend. Upon the transfer, exchange or replacement of
Notes not bearing the Private Placement Legend, the Registrar shall deliver
Notes that do not bear the Private Placement Legend. Upon the transfer, exchange
or replacement of Notes bearing the Private Placement Legend, the Registrar
shall deliver only Notes that bear the Private Placement Legend, unless (i) the
requested transfer is after the relevant Resale Restriction Termination Date
with respect to such Notes, (ii) upon written request of the Company after there
is delivered to the Registrar an opinion of counsel (which opinion and counsel
are 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, (iii) with
respect to an Offshore Global Note, with the agreement of the Company on or
after the Offshore Note Exchange Date with respect to such Note, (iv) such Notes
are sold or exchanged pursuant to an effective registration statement under the
Securities Act or (v) such Notes are sold pursuant to Section 3.14(f).
(m) 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 3.13 or this Section 3.14 (including
all Notes received for transfer pursuant to this Section 3.14). The Company
shall have the right to require the Registrar to deliver to the Company, at the
Company's expense, copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable written
notice to the Registrar.
In connection with any transfer of any Note, the Trustee, the Registrar and
the Company shall be entitled to receive, shall be under no duty to inquire
into, may conclusively presume the correctness of, and shall be fully protected
in relying upon the certificates, opinions and other information referred to
herein (or in the forms provided
53
herein, attached hereto or to the Notes, or otherwise) received from any Holder
and any transferee of any Note regarding the validity, legality and due
authorization of any such transfer, the eligibility of the transferee to receive
such Note and any other facts and circumstances related to such transfer.
(n) Certain Additional Terms Applicable to Physical Notes. Any transferee
entitled to receive a Physical Note may request that the principal amount
thereof be evidenced by one or more Physical Notes in any authorized
denomination or denominations and the Registrar shall comply with such request
if all other transfer restrictions are satisfied.
ARTICLE 4
Covenants
Section 4.01. Payment of Principal, Premium and Interest. (a) The Company
will duly and punctually pay the principal of (and premium, if any) and interest
and Liquidated Damages, if any, on the Notes in accordance with the terms of the
Notes and this Indenture. An installment of principal (and premium, if any) or
interest and Liquidated Damages shall be considered paid on the date it is due
if the Trustee or Paying Agent or Paying Agents hold on that date money
designated for and sufficient to pay the installment.
(b) Payments (including principal, premium, if any, interest and Liquidated
Damages, if any) in respect of the Notes represented by the Global Notes, the
Holder of which has given wire transfer instructions on or prior to the relevant
record date, shall be made by wire transfer of immediately available funds to
the accounts specified by the Global Note Holder. With respect to Physical
Notes, the Company will make all payments of principal, premium, if any,
interest and Liquidated Damages, if any, at the office or agency maintained by
the Company in The City of New York referred to in Section 4.02 or, at the
option of the Company, by mailing a check to each such Holder's registered
address.
Section 4.02. Maintenance of Office or Agency. The Company will maintain in
the Borough of Manhattan, The City of New York an office or agency where Notes
may be presented or surrendered for payment, where Notes may be surrendered for
transfer or exchange and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company will give
prompt written notice to the Trustee of the location, and of any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain such 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 Corporate Trust Office of the Trustee. The Company hereby
designates the Corporate Trust Office as an initial Place of Payment and as such
office of the Company in the Borough of Manhattan, The City of New York, and
appoints the Trustee as its agent to receive all such presentations, surrenders,
notices and demands so long as such Corporate Trust Office remains a Place of
Payment.
Section 4.03. Money for Payments to Be Held in Trust. If the Company shall
at any time act as its own Paying Agent, it will, on or before each due date of
the principal
54
of (and premium, if any) or interest and Liquidated Damages, if any, on, any of
the Notes, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
and Liquidated Damages, if any, so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided, and will promptly
notify the Trustee of its action or failure so to act.
If the Company is not acting as its own Paying Agent, it will, prior to
each due date of the principal of (and premium, if any) or interest and
Liquidated Damages, if any, on, any Notes, deposit with a Paying Agent a sum
sufficient to pay the principal (and premium, if any) or interest and Liquidated
Damages, if any, so becoming due, such sum to be held in trust for the benefit
of the Persons entitled to such principal, premium or interest and Liquidated
Damages, and (unless such Paying Agent is the Trustee) the Company will promptly
notify the Trustee of its action or failure so to act.
If the Company is not acting as its own Paying Agent, the Company will
cause any Paying Agent other than the Trustee to execute and deliver to the
Trustee an instrument in which such Paying Agent shall agree with the Trustee,
subject to the provisions of this Section 4.03, that such Paying Agent will:
(a) hold all sums held by it for the payment of principal of (and premium,
if any) or interest and Liquidated Damages, if any, on Notes in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(b) give the Trustee notice of any default by the Company (or any other
obligor upon the Notes) in the making of any such payment of principal (and
premium, if any) or interest and Liquidated Damages, if any;
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent; and
(d) acknowledge, accept and agree to comply in all respects with the
provisions of this Indenture and TIA relating to the duties, rights and
liabilities of such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of (and premium, if any)
or interest and Liquidated Damages, if any, on any Note and remaining unclaimed
for two years
55
after such principal (and premium, if any) or interest and Liquidated Damages,
if any, has become due and payable shall be paid in the appropriate proportion
to the Company upon a Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease.
Section 4.04. SEC Reports. (a) Whether or not required by the rules and
regulations of the SEC, so long as any Notes issued hereunder are outstanding,
the Company will furnish to each Trustee and the Holders of Notes (i) all
quarterly and annual financial information that would be required to be
contained in a filing with the SEC on Forms 10-Q and 10-K if the Company were
required to file such Forms, including a "Management's Discussion and Analysis
of Financial Condition and Results of Operations" and, with respect to the
annual information only, a report thereon by the Company's certified independent
accountants and (ii) all current reports that would be required to be filed with
the SEC on Form 8-K if the Company were required to file such reports. In
addition, whether or not required by the rules and regulations of the SEC, the
Company will file a copy of all such information and reports with the SEC for
public availability and make such information available to securities analysts
and prospective investors upon request.
(b) For so long as any Notes remain outstanding, the Company will furnish
to the Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4)
under the Securities Act.
(c) All obligors on the Notes will comply with Section 314(a) of the TIA.
(d) The Company shall promptly mail copies of all such annual reports,
information, documents and other reports provided to the Trustee pursuant to
clauses (a) and (c) hereof to the Holders at their addresses appearing in the
Register maintained by the Registrar.
(e) 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 Officer's Certificates).
Section 4.05. Certificates to Trustee. (a) The Company will deliver to the
Trustee within 120 days after the end of each fiscal year of the Company a
certificate from the principal executive, financial or accounting officer of the
Company stating that such officer has conducted or supervised a review of the
activities of the Company and its Restricted Subsidiaries and the Company's and
its Restricted Subsidiaries' performance under this Indenture and that, based
upon such review, to the best of such officer's knowledge, the Company has
fulfilled all obligations thereunder or, if there has
56
been a default in the fulfillment of any such obligation (determined without
regard to any period of grace or requirement of notice provided in this
Indenture), specifying each such default and the nature and status thereof.
(b) The Company will deliver to the Trustee, as soon as possible and in any
event within 30 days after the Company becomes aware of an Event of Default or a
Default, an Officer's Certificate setting forth the details of such Event of
Default or Default, and the action which the Company proposes to take or has
taken with respect thereto.
(c) The Company will deliver to the Trustee within 120 days after the end
of each fiscal year of the Company a written statement by the Company's
independent public accountants stating (i) that their audit examination has
included a review of the terms of this Indenture and the Notes as they relate to
accounting matters, and (ii) whether, in connection with their audit
examination, any Default has come to their attention and, if such a Default has
come to their attention, specifying the nature and period of the existence
thereof.
Section 4.06. Limitation on Indebtedness. (a) On or after the Issue Date:
(i) the Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
Guarantee or otherwise become directly or indirectly liable, contingently
or otherwise, with respect to (collectively, "incur") any Indebtedness
(including Acquired Debt);
(ii) the Company will not, and will not permit any of its Restricted
Subsidiaries to, issue any Disqualified Stock (including Acquired
Disqualified Stock);
(iii) and the Company will not permit any of its Restricted
Subsidiaries that are not Subsidiary Guarantors to issue any shares of
Preferred Stock (including Acquired Preferred Stock);
provided, however, that the Company and the Subsidiary Guarantors may incur
Indebtedness (including Acquired Debt) and the Company and the Subsidiary
Guarantors may issue shares of Disqualified Stock (including Acquired
Disqualified Stock) if the Fixed Charge Coverage Ratio for the Company's most
recently ended four full fiscal quarters for which financial statements have
been filed with the SEC pursuant to Section 4.04 immediately preceding the date
on which such additional Indebtedness is incurred or such Disqualified Stock is
issued would have been at least 2.0 to 1, determined on a pro forma basis
(including a pro forma application of the net proceeds therefrom), as if the
additional Indebtedness had been incurred or the Disqualified Stock had been
issued, as the case may be, at the beginning of such four-quarter period.
Letters of credit and bankers' acceptances shall be deemed to have an aggregate
principal amount of Indebtedness equal to the maximum amount available
thereunder.
(b) The foregoing provisions will not apply to:
57
(i) the incurrence by the Company of Indebtedness pursuant to the
Existing Credit Facility (and by its Subsidiaries of Guarantees thereof) in
an aggregate principal amount at any time outstanding not to exceed an
amount equal to $3.477 billion less the aggregate amount of all mandatory
repayments (other than mandatory prepayments triggered solely by the
issuance of Indebtedness or Preferred Stock of a Finance Subsidiary to
refinance the Existing Credit Facility) applied after the Existing Notes
Issue Date to (x) repay loans (other than revolving credit loans)
outstanding thereunder or (y) permanently reduce the revolving credit
commitments thereunder;
(ii) the incurrence by the Company and the Subsidiary Guarantors of
Indebtedness represented by the Notes (other than Additional Notes) and the
Subsidiary Guarantees thereof;
(iii) the incurrence by the Company and its Restricted Subsidiaries of
Existing Indebtedness (other than Indebtedness of the type described in
clause (i), (ii) or (v) through (xii) of this covenant);
(iv) the incurrence by the Company or any of its Restricted
Subsidiaries of any Permitted Refinancing in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund, Indebtedness that was permitted to be incurred under the Fixed
Charge Coverage Ratio test set forth above or clause (ii) or (iii) above or
(xiii) or (xiv) below or this clause (iv);
(v) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness between or among the Company and
any of its Restricted Subsidiaries; provided, however, that (i) if the
Company or any Subsidiary Guarantor is the obligor on such Indebtedness,
such Indebtedness is expressly subordinated to the prior payment in full in
cash of all Obligations with respect to the Notes or the Subsidiary
Guarantee, as the case may be, and (ii)(A) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness being
held by a Person other than the Company or a Restricted Subsidiary and (B)
any sale or other transfer of any such Indebtedness to a Person that is not
either the Company or a Restricted Subsidiary shall be deemed, in each
case, to constitute an incurrence of such Indebtedness by the Company or
such Restricted Subsidiary, as the case may be;
(vi) the incurrence by the Company or any Restricted Subsidiary of
Hedging Obligations that are incurred for the purpose of (A) fixing or
hedging interest rate or currency risk with respect to any fixed or
floating rate Indebtedness that is permitted by the Indenture to be
outstanding or any receivable or liability the payment of which is
determined by reference to a foreign currency; provided that the notional
principal amount of any such Hedging Obligation does not exceed the
principal amount of the Indebtedness to which such Hedging Obligation
relates or (B) fixing or hedging risk with respect to fluctuations in the
cost of raw materials; provided that such obligation is entered into for
valid business purposes other than speculative purposes (as
58
determined by the Company's or such Restricted Subsidiary's principal
financial officer in the exercise of his or her good faith business
judgment);
(vii) the issuance by any of the Company's Restricted Subsidiaries of
shares of Preferred Stock to the Company or a Wholly Owned Restricted
Subsidiary; provided that (A) any subsequent issuance or transfer of Equity
Interests that results in such Preferred Stock being held by a Person other
than the Company or a Wholly Owned Restricted Subsidiary or (B) the
transfer or other disposition by the Company or a Wholly Owned Restricted
Subsidiary of any such shares to a Person other than the Company or a
Wholly Owned Restricted Subsidiary shall be deemed, in each case, to
constitute an issuance of such Preferred Stock by such Subsidiary on such
date that is not permitted by this clause (vii);
(viii) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness represented by tender, bid, performance,
government contract, surety or appeal bonds, standby letters of credit and
warranty and contractual service obligations of like nature, trade letters
of credit or documentary letters of credit, in each case to the extent
incurred in the ordinary course of business of the Company or such
Restricted Subsidiary and the incurrence by the Company of Indebtedness
represented by letters of credit incurred in connection with the PBGC
Settlement;
(ix) the incurrence by any Restricted Subsidiary of the Company of
Indebtedness or the issuance by any Restricted Subsidiary of Preferred
Stock, the aggregate principal amount or liquidation preference of which,
together with all other Indebtedness and Preferred Stock of the Company's
Restricted Subsidiaries at the time outstanding and incurred or issued in
reliance upon this clause (ix), does not exceed $50.0 million;
(x) the issuance by any Finance Subsidiary of Preferred Stock with
an aggregate liquidation preference not exceeding the amount of
Indebtedness of the Company held by such Finance Subsidiary; provided that
the Fixed Charge Coverage Ratio for the Company's most recently ended four
full fiscal quarters for which financial statements have been filed with
the SEC pursuant to the covenant described below under Section 4.04
immediately preceding the date on which such Preferred Stock is issued
would have been at least 2.0 to 1, determined on a pro forma basis
(including a pro forma application of the net proceeds therefrom) as if
such Preferred Stock had been issued at the beginning of such four-quarter
period;
(xi) the incurrence of Indebtedness by Foreign Subsidiaries in an
aggregate principal amount (or accreted value, as applicable) at any time
outstanding and incurred in reliance upon this clause (xi) not to exceed
$100.0 million;
59
(xii) the Guarantee by any Restricted Subsidiary of Indebtedness of
the Company or a Restricted Subsidiary that was permitted to be incurred by
another provision of this covenant;
(xiii) Acquired Debt or Acquired Disqualified Stock; provided that
such Indebtedness or Disqualified Stock was not incurred in connection with
or in contemplation of such Person's becoming a Restricted Subsidiary; and
provided further that immediately after giving effect to such incurrence,
the Fixed Charge Coverage Ratio for the Company's most recently ended four
full fiscal quarters for which financial statements have been filed with
the SEC pursuant to Section 4.04 immediately preceding the date of such
incurrence would have been at least 2.0 to 1, determined on a pro forma
basis;
(xiv) Indebtedness or Disqualified Stock of a Specified Joint Venture
or a Subsidiary thereof existing at the time such Specified Joint Venture
first becomes a Restricted Subsidiary; provided that such Indebtedness or
Disqualified Stock was not incurred in connection with or in contemplation
of such Specified Joint Venture's becoming a Restricted Subsidiary; and
provided further that immediately after giving effect to such Specified
Joint Venture's becoming a Restricted Subsidiary, the Fixed Charge Coverage
Ratio for the Company's most recently ended four full fiscal quarters for
which financial statements have been filed with the SEC pursuant to Section
4.04 immediately preceding the date on which such Specified Joint Venture
became a Restricted Subsidiary would have been, determined on a pro forma
basis, (x) at least 2.0 to 1 or (y) equal to or greater than it was
immediately prior to such Specified Joint Venture's becoming a Restricted
Subsidiary;
(xv) with respect to any Specified Joint Venture that becomes a
Restricted Subsidiary, the incurrence by such Specified Joint Venture of
Indebtedness under any revolving credit facility in an aggregate principal
amount at any time outstanding not to exceed the aggregate principal amount
of committed financing under all revolving credit facilities of such
Specified Joint Venture as in effect on the Issue Date; and
(xvi) the incurrence by the Company or any Subsidiary Guarantor of
Indebtedness in an aggregate principal amount (or accreted value, as
applicable) at any time outstanding and incurred in reliance on this clause
(xvi) not to exceed $25.0 million.
(c) For purposes of determining compliance with this covenant, in the
event that an item of Indebtedness or Preferred Stock meets the criteria of more
than one of the categories of permitted Indebtedness described in clauses (i)
through (xvi) above or is entitled to be incurred pursuant to Section 4.06(a),
the Company shall, in its sole discretion, classify such item of Indebtedness or
Preferred Stock in any manner that complies with this covenant and such
Indebtedness or Preferred Stock will be treated as having been incurred pursuant
to the clauses or Section 4.06(a), as the case may be, designated by the
Company. The amount of Indebtedness issued at a price which is less
60
than the principal amount thereof shall be equal to the amount of the liability
in respect thereof determined in accordance with GAAP.
Section 4.07. Limitation on Restricted Payments. (a) The Company will not,
and will not permit any of its Restricted Subsidiaries to, directly or
indirectly:
(i) declare or pay any dividend or make any distribution on account
of the Company's or any of its Restricted Subsidiaries' Equity Interests
(other than (x) dividends or distributions payable in Qualified Equity
Interests of the Company and (y) dividends or distributions payable to the
Company or any Restricted Subsidiary of the Company);
(ii) purchase, redeem or otherwise acquire or retire for value any
Equity Interests of the Company, any of its Restricted Subsidiaries or any
Affiliate of the Company (other than any such Equity Interests owned by the
Company or any of its Restricted Subsidiaries);
(iii) make any principal payment on, or purchase, redeem, defease or
otherwise acquire or retire for value any Indebtedness ("Subordinated
Debt") of the Company or any Restricted Subsidiary that is subordinated by
its terms to the Notes or the Subsidiary Guarantees (other than
Indebtedness owed to the Company or any Restricted Subsidiary), except, in
each case, payment of interest or principal at Stated Maturity; or
(iv) make any Restricted Investment (all such payments and other
actions set forth in clauses (i) through (iv) above being collectively
referred to as "Restricted Payments");
unless, at the time of and after giving effect to such Restricted Payment (the
amount of any such Restricted Payment, if other than cash, shall be the fair
market value (as conclusively evidenced by a Board Resolution) of the asset(s)
proposed to be transferred by the Company or such Restricted Subsidiary, as the
case may be, pursuant to such Restricted Payment):
(A) no Default or Event of Default shall have occurred and be continuing
after giving effect thereto; and
(B) the Company would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the most recently ended four full fiscal quarters for which
financial statements have been filed with the SEC pursuant to Section 4.04
immediately preceding the date of such Restricted Payment, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in Section 4.06(a) and
(C) such Restricted Payment, together with the aggregate of all other
Restricted Payments made by the Company and its Restricted Subsidiaries after
the Existing Notes Issue Date (excluding Restricted Payments permitted by
Section
61
4.07(b)(ii) (to the extent paid to the Company or any of its Restricted
Subsidiaries or to the extent such distributions are deducted as a minority
interest in calculating Consolidated Net Income), Section 4.07(b)(iii), Section
4.07(b)(iv), Section 4.07(b)(v), Section 4.07(b)(vii), Section 4.07(b)(x),
Section 4.07(b)(xiv) and Section 4.07(b)(xvi) and 50% of any Restricted Payments
permitted by Section 4.07(b)(viii)), is less than the sum, without duplication,
of:
(i) 50% of the Consolidated Net Income of the Company for the period
(taken as one accounting period) from the beginning of the first
fiscal quarter commencing on April 1, 1999, to the end of the
Company's most recently ended fiscal quarter for which financial
statements have been filed with the SEC pursuant to Section 4.04 at
the time of such Restricted Payment (or, if such Consolidated Net
Income for such period is a deficit, less 100% of such deficit), plus
(ii) 100% of the aggregate net cash proceeds received by the Company
or any of its Restricted Subsidiaries from the issue or sale (other
than to a Subsidiary or Joint Venture of the Company) after the
Existing Notes Issue Date of Qualified Equity Interests of the Company
or of debt securities of the Company or any of its Restricted
Subsidiaries that have been converted into or exchanged for such
Qualified Equity Interests of the Company, plus
(iii) to the extent that any Restricted Investment (other than a
Restricted Investment permitted to be made pursuant to Section
4.07(b)(vii) or Section 4.07(b)(viii) below) that was made after the
Existing Notes Issue Date is sold for cash or otherwise liquidated,
repaid or otherwise reduced, including by way of dividend (to the
extent not included in calculating Consolidated Net Income), for cash,
the lesser of (A) the cash return with respect to such Restricted
Investment (less the cost of disposition, if any) and (B) the initial
amount of such Restricted Investment plus
(iv) an amount equal to the sum of (A) the net reduction in
Investments in Unrestricted Subsidiaries resulting from dividends,
repayments of loans or other transfers of assets (to the extent not
included in calculating Consolidated Net Income), in each case to the
Company or any Restricted Subsidiary from Unrestricted Subsidiaries
and (B) the portion (proportionate to the Company's equity interest in
such Subsidiary) of the fair market value of the net assets of an
Unrestricted Subsidiary at the time such Unrestricted Subsidiary is
designated a Restricted Subsidiary; provided, however, that the
foregoing sum shall not exceed, in the case of any Unrestricted
Subsidiary, the amount of Restricted Investments (other than
Restricted Investments permitted to be made pursuant to Section
4.07(b)(vii) or Section 4.07(b)(viii) below) previously made after the
Existing Notes Issue Date by the Company or any Restricted Subsidiary
in such Unrestricted Subsidiary.
62
(b) If, other than with respect to payments made under Section 4.07(b)(i)
and Section 4.07(b)(xiv) below, no Default or Event of Default shall have
occurred and be continuing after giving effect to such Restricted Payment, the
foregoing provisions will not prohibit the following Restricted Payments:
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration such payment would have
complied with the provisions of the Indenture;
(ii) dividends or distributions by any Restricted Subsidiary of the
Company payable (x) to all holders of a class of Capital Stock of such
Restricted Subsidiary on a pro rata basis or on a basis that is more
favorable to the Company; provided that at least 50% of such class of
Capital Stock is held by the Company and/or one or more of its Restricted
Subsidiaries or (y) to all holders of a class of Preferred Stock of a
Restricted Subsidiary that is not a Subsidiary Guarantor issued after the
Issue Date in compliance with Section 4.06;
(iii) the payment of cash dividends on any series of Disqualified
Stock issued after the Existing Notes Issue Date in an aggregate amount not
to exceed the cash received by the Company since the Existing Notes Issue
Date upon issuance of such Disqualified Stock;
(iv) the redemption, repurchase, retirement or other acquisition of
any Equity Interests of the Company, any Restricted Subsidiary or any Joint
Venture (or the acquisition of all the outstanding Equity Interests of any
Person that conducts no operations and has no assets or liabilities other
than the ownership of Equity Interests in a Joint Venture) in exchange for,
or out of the net cash proceeds of the substantially concurrent sale (other
than to a Subsidiary or Joint Venture of the Company) of, Qualified Equity
Interests of the Company; provided that the amount of any such net cash
proceeds that are utilized for any such redemption, repurchase, retirement
or other acquisition shall be excluded from clause (C)(ii) of Section
4.07(a);
(v) the defeasance, redemption or repurchase of Subordinated Debt
with the net cash proceeds from an incurrence of Permitted Refinancing or
in exchange for or out of the net cash proceeds from the substantially
concurrent sale (other than to a Subsidiary or Joint Venture of the
Company) of Qualified Equity Interests of the Company; provided that the
amount of any such net cash proceeds that are utilized for any such
redemption, repurchase, retirement or other acquisition shall be excluded
from clause (C)(ii) of Section 4.07(a);
(vi) the repurchase, redemption or other acquisition or retirement
for value of (x) any Equity Interests of the Company or any Subsidiary of
the Company held by any member of the Company's (or any of its
Subsidiaries') management pursuant to any management equity subscription
agreement or stock option agreement or (y) any Equity Interests of the
Company that are or are intended to be used to satisfy issuances of Equity
Interests upon exercise of
63
employee or director stock options or upon exercise or satisfaction of
other similar instruments outstanding under employee or director benefit
plans of the Company or any Subsidiary of the Company; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or
retired Equity Interests shall not exceed $5.0 million in any fiscal year
of the Company;
(vii) Restricted Investments in any of the Specified Joint Ventures
(including without limitation, the purchase of Equity Interests of a
Specified Joint Venture directly from another Person or the purchase of all
the outstanding Equity Interests of any Person that conducts no operations
and has no assets or liabilities other than the ownership of Equity
Interests of a Specified Joint Venture) to the extent that the proceeds
thereof are used to purchase or redeem an interest of another Person in
such Specified Joint Venture (other than the Company, a Restricted
Subsidiary or an Affiliate of the Company, except a Person that is deemed
to be an Affiliate solely by virtue of its ownership of Equity Interests of
the Company acquired in exchange for Equity Interests in such Specified
Joint Venture); provided that after giving pro forma effect thereto as if
such Restricted Payment (and any related incurrence of Indebtedness) had
been made at the beginning of the most recently ended four-full-fiscal-
quarter period for which financial statements have been filed with the SEC
pursuant to Section 4.04 immediately preceding the date of such Restricted
Payment, the Company would have been permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test
set forth in Section 4.06(a);
(viii) Restricted Investments in any Joint Venture made during any
fiscal year of the Company or within 45 days after the end of such fiscal
year in amounts that, together with all other Restricted Investments made
in such Joint Venture in respect of such fiscal year in reliance on this
Section 4.07(b)(viii) during such fiscal year or within 45 days after the
end of such fiscal year, do not exceed the amount of dividends or
distributions previously paid in respect of such fiscal year to the Company
or any Restricted Subsidiary by such Joint Venture;
(ix) the payment of dividends on the Company's common stock in an
aggregate amount per annum not to exceed the product of
(i) $0.90 and
(ii) the sum, without duplication, of
(w) the number of shares outstanding on the day prior to the
Existing Notes Issue Date plus
(x) 40,250,000 plus
(y) if the Company issues shares of its common stock after the
Existing Notes Issue Date, to the extent (1) such shares are issued in
64
exchange for or (2) the net cash proceeds therefrom are used
substantially concurrently to acquire Equity Interests (held by a
Person other than the Company, a Restricted Subsidiary or an Affiliate
of the Company, except a Person that is deemed to be an Affiliate
solely by virtue of its ownership of Equity Interests of the Company
acquired in exchange for Equity Interests in such Specified Joint
Venture) of a Specified Joint Venture that immediately prior to such
issuance was or as a result of such exchange or acquisition becomes a
Restricted Subsidiary (and such Specified Joint Venture is not
subsequently designated as an Unrestricted Subsidiary), such number of
shares of common stock plus
(z) the sum of (1) 1,000,000 and (2) such number of shares of
common stock of the Company as have been or are issued after the
Existing Notes Issue Date pursuant to the exercise of employee or
director stock options granted prior to the Existing Notes Issue Date
or issued after the Existing Notes Issue Date pursuant to other
employee or director benefit plans of the Company or any of its
Restricted Subsidiaries or issuable pursuant to the exercise of
employee or director stock options granted after the Existing Notes
Issue Date; provided that the aggregate number of shares includable
pursuant to this clause (z)(2) with respect to shares issued or
issuable during any fiscal year of the Company shall not exceed
1,000,000;
provided further that the number of shares referred to in clauses (y)
and (z) shall be adjusted to reflect any stock split (or reverse stock
split) or stock dividend made after the Issue Date and prior to the
date such shares were issued;
(x) distributions or payments of Receivables Fees;
(xi) (A) Investments in any Joint Venture or Unrestricted
Subsidiary organized to construct, own and/or operate a propylene oxide
plant in the European Union in an aggregate amount that, together with all
other Investments made pursuant to this Section 4.07(b)(xi), does not
exceed $100.0 million and (B) the pledge of the Capital Stock of such Joint
Venture or Unrestricted Subsidiary or of a Joint Venture Subsidiary that
has no assets and conducts no operations other than the holding directly or
indirectly of Equity Interests of such Joint Venture to secure Non-Recourse
Debt of such Joint Venture or Unrestricted Subsidiary;
(xii) (A) (x) the transfer of the TDI Assets to a newly formed Joint
Venture or Unrestricted Subsidiary or (y) the designation of any Restricted
Subsidiary that has no assets or liabilities other than all or a portion of
the TDI Assets as an Unrestricted Subsidiary, in each case, in connection
with the incurrence of Indebtedness by such Joint Venture or Unrestricted
Subsidiary or Rhodia or a wholly-owned subsidiary of Rhodia to improve the
Rhodia TDI Plant and (B) the pledge of the Capital Stock of such Joint
Venture or
65
Unrestricted Subsidiary or of a Joint Venture Subsidiary that has no assets
and conducts no operations other than the holding directly or indirectly of
Equity Interests of such Joint Venture to secure Non-Recourse Debt of such
Joint Venture or Unrestricted Subsidiary or Rhodia or a wholly-owned
subsidiary of Rhodia;
(xiii) the repurchase of any Subordinated Debt at a purchase price not
greater than 101% of the principal amount thereof in the event of (x) a
Change of Control pursuant to a provision no more favorable to the holders
thereof than the provisions of Section 4.14 or (y) an Asset Sale pursuant
to a provision no more favorable to the holders thereof than the provisions
of Section 4.09; provided that, in each case, prior to such repurchase the
Company has made a Change of Control Offer or Asset Sale Offer, as
applicable, and repurchased all Notes that were validly tendered for
payment in connection with such Change of Control Offer or Asset Sale
Offer;
(xiv) distributions by any Restricted Subsidiary or Joint Venture of
chemicals to a holder of Capital Stock of such Restricted Subsidiary or
Joint Venture if such distributions are made pursuant to a provision in a
joint venture agreement or other arrangement entered into in connection
with the establishment of such Joint Venture or Restricted Subsidiary that
requires such holder to pay a price for such chemicals equal to that which
would be paid in a comparable transaction negotiated on an arm's-length
basis (or pursuant to a provision that imposes a substantially equivalent
requirement);
(xv) any other Restricted Payment that, together with all other
Restricted Payments made pursuant to this Section 4.07(b)(xv) on or after
the Existing Notes Issue Date, does not exceed $25 million (after giving
effect to any subsequent reduction in the amount of any Investments made
pursuant to this Section 4.07(b)(xv) as a result of the repayment or other
disposition thereof for cash as set forth in clause (iii) of the first
paragraph above, the amount of such reduction not to exceed the amount of
such Investments previously made pursuant to this Section 4.07(b)(xv)); and
(xvi) dividends or distributions by any Joint Venture (other than a
Specified Joint Venture) to all holders of a class of Capital Stock of such
Joint Venture permitted by Section 4.07(b)(ii)(x) above; provided that
after giving effect to such dividends or distributions and any related
transactions, the Joint Venture making such dividends or distributions to
such holders is contractually entitled to receive, and receives within 180
days before or after the date of such dividends or distributions, directly
or indirectly, an equivalent or larger cash payment from each such holder
(other than from a holder that is the Company or any Restricted Subsidiary)
or from an Affiliate of such holder, which cash payment has not been
previously applied pursuant to this Section 4.07(b)(xvi) to offset any
other dividend or distribution by such Joint Venture to such holder and (y)
such dividends or distributions do not exceed such holders' pro rata share
of the Joint Venture's cash flows from operating activities, minus any non-
cash charge to the extent that it represents an accrual of or reserve for
cash
66
expenditures in any future period or amortization of a prepaid cash expense
in any future period.
(c) The Board of Directors of the Company may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if such designation would not cause
a Default. For purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries in the Subsidiary so
designated will be deemed to be Restricted Payments at the time of such
designation and will reduce the amount available for Restricted Payments Section
4.07(a) (except to the extent such Investments were repaid in cash, and, in the
case of a Joint Venture (and any Subsidiary of a Joint Venture) designated as an
Unrestricted Subsidiary on the first day that it is a Subsidiary of the Company,
except to the extent that (1) such Investments were made after the Existing
Notes Issue Date or (2) in the case of a Specified Joint Venture, such
Investments were made prior to the Existing Notes Issue Date). All such
outstanding Investments (except as provided in the parenthetical included in the
preceding sentence) will be deemed to constitute Investments in an amount equal
to the fair market value of such Investments at the time of such designation (as
conclusively determined by the Board of Directors). Such designation will only
be permitted if any such Restricted Payment would be permitted at such time and
if such Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary. In the case of any designation by the Company of a Person as an
Unrestricted Subsidiary on the first day that such Person is a Subsidiary of the
Company in accordance with the provisions of the Indenture, such designation
shall be deemed to have occurred for all purposes of the Indenture
simultaneously with, and automatically upon, such Person becoming a Subsidiary.
(d) Not later than the date of making any Restricted Payment, other than
those permitted by Sections 4.07(b)(ii)(x), 4.07(b)(vi), 4.07(b)(x) and
4.07(b)(xiv) above, and not later than the 120th day after making any Restricted
Payment permitted by Section 4.07(b)(vi) above, the Company shall deliver to the
Trustee an Officers' Certificate stating that such Restricted Payment is
permitted and setting forth the basis upon which the calculations required by
this Section 4.07 were computed.
(e) For purposes of this covenant, any payment made on or after the
Existing Notes Issue Date but prior to the Issue Date shall be deemed to be a
"Restricted Payment" to the extent such payment would have been a Restricted
Payment had the Indenture been in effect at the time of such payment (and, to
the extent that any such Restricted Payment was permitted by clauses (b)(i)
through (xvi) above, such Restricted Payment may be deemed by the Company to
have been made pursuant to such clause).
Section 4.08. Limitation on Dividend and other Payment Restrictions
Affecting Restricted Subsidiaries and Joint Ventures. (a) 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
restriction on the ability of any Restricted Subsidiary to:
(i) (A) pay dividends or make any other distributions to the Company
or any of its Restricted Subsidiaries (1) on its Capital Stock, or (2) with
respect
67
to any other interest or participation in, or measured by, its profits, or
(B) pay any Indebtedness owed to the Company or any of its Restricted
Subsidiaries;
(ii) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(iii) transfer any of its properties or assets to the Company or
any of its Restricted Subsidiaries;
except for such restrictions existing under or by reason of:
(a) existing agreements as in effect on the Issue Date;
(b) Indebtedness permitted by the Indenture to be incurred containing
restrictions on the ability of Restricted Subsidiaries to consummate
transactions of the types described in clause (i), (ii) or (iii) above not
materially more restrictive than those contained in the Indenture;
(c) the Indenture;
(d) applicable law;
(e) existing restrictions with respect to a Person acquired by the Company
or any of its Restricted Subsidiaries (except to the extent such restrictions
were put in place in connection with or in contemplation of such acquisition),
which restrictions are 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,
so acquired;
(f) customary non-assignment provisions in leases and other agreements
entered into in the ordinary course of business;
(g) construction loans and purchase money obligations (including Capital
Lease Obligations) for property acquired in the ordinary course of business that
impose restrictions of the nature described in clause (iii) above on the
property so constructed or acquired;
(h) in the case of clause (iii) above, restrictions contained in security
agreements or mortgages securing Indebtedness of a Restricted Subsidiary to the
extent such restrictions restrict the transfer of the property subject to such
security agreements or mortgages;
(i) a Permitted Refinancing, provided that the restrictions contained in
the agreements governing such Permitted Refinancing are not materially more
restrictive, taken as a whole, than those contained in the agreements governing
the Indebtedness being refinanced (as conclusively evidenced by a Board
Resolution);
(j) customary restrictions on a Finance Subsidiary imposed in such Finance
Subsidiary's organizational documents or by the terms of its Preferred Stock;
68
(k) any restriction with respect to shares of Capital Stock of a Restricted
Subsidiary imposed pursuant to an agreement entered into for the sale or
disposition of such shares of Capital Stock or any restriction with respect to
the assets of a Restricted Subsidiary imposed pursuant to an agreement entered
into for the sale or disposition of such assets or all or substantially all the
Capital Stock of such Restricted Subsidiary pending the closing of such sale or
disposition;
(l) in the case of any Restricted Subsidiary that is a Joint Venture,
customary restrictions on such Restricted Subsidiary contained in its joint
venture agreement, which restrictions are consistent with the past practice of
the Company and its Restricted Subsidiaries (as conclusively evidenced by a
Board Resolution);
(m) existing restrictions with respect to a Specified Joint Venture or the
property or assets thereof or a Subsidiary of a Specified Joint Venture or the
property or assets thereof, in each case, at the time such Specified Joint
Venture first becomes a Restricted Subsidiary (except to the extent such
restrictions were put in place in connection with or in contemplation of such
Specified Joint Venture becoming a Restricted Subsidiary), which restrictions
are not applicable to any Person, or the properties or assets of any Person,
other than such Specified Joint Venture or the property or assets thereof or a
Subsidiary of such Specified Joint Venture or the property or assets thereof;
and
(n) the Existing Credit Facility and related documentation as the same is
in effect on the Issue Date and as amended, modified, extended, renewed,
refunded, refinanced, restated or replaced from time to time; provided that the
Existing Credit Facility and related documentation as so amended, modified,
extended, reviewed, refunded, refinanced, restated or replaced is not materially
more restrictive, taken as a whole, as to the matters enumerated above than the
Existing Credit Facility and related documentation as in effect on the Issue
Date (as conclusively evidenced by a Board Resolution).
For purposes of determining compliance with this covenant, in the event
that a restriction meets the criteria of more than one of the categories of
permitted restrictions described in clauses (a) through (n) above, the Company
shall, in its sole discretion, classify such restriction in any manner that
complies with this covenant, and such restriction will be treated as existing
pursuant to the clauses designated by the Company.
(b) The Company will use best efforts (consistent with its contractual
obligations and fiduciary duties to any Joint Venture, in each case, as in
effect on the Issue Date) not to permit any of its Joint Ventures that are not
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or
suffer to exist or become effective any restriction on the ability of such Joint
Venture to:
(i) (A) pay dividends or make any other distributions to the Company or
any of its Restricted Subsidiaries (1) on its Capital Stock or (2) with
respect to any other interest or participation in, or measured by, its
profits or (B) pay any Indebtedness owed to the Company or any of its
Restricted Subsidiaries;
69
(ii) make loans or advances to the Company or any of its Restricted
Subsidiaries; or
(iii) transfer any of its properties or assets to the Company or any
of its Restricted Subsidiaries;
except for such restrictions existing under or by reason of:
(a) such Joint Venture's joint venture agreement or its credit facility
(provided that in each case such restrictions are consistent with the past
practice of the Company);
(b) in the case of any Joint Venture existing on the Issue Date, its
existing agreements as in effect on the date of the Indenture and as amended,
modified, extended, restated or replaced from time to time; provided that no
such amendment, modification, extension, restatement or replacement results in
agreements that are materially more restrictive, taken as a whole, as to the
matters enumerated above than the existing agreements as in effect on the date
of the Indenture (as conclusively evidenced by a Board Resolution);
(c) in the case of LCR, any instrument governing its Indebtedness; and
(d) the restrictions described in clauses (d), (e), (f), (g), (h), (j),
(k) and (n) of Section 4.08(a) (assuming that references in clauses (h) and (k)
to a Restricted Subsidiary were references to a Joint Venture).
Section 4.09. Limitation on Sales of Assets. (a) The Company will not, and
will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale
unless:
(i) the Company and/or the Restricted Subsidiary, as the case may be,
receives consideration at the time of such Asset Sale at least equal to the
fair market value (as conclusively evidenced by a Board Resolution set
forth in an Officers' Certificate delivered to the Trustee) of the assets
or Equity Interests issued or sold or otherwise disposed of; and
(ii) at least 80% of the consideration therefor received by the
Company and/or such Restricted Subsidiary is in the form of
(A) cash or Cash Equivalents or
(B) a controlling interest or a joint venture interest (to the
extent otherwise permitted by the Indenture) in a business engaged in
a Permitted Business or long-term property or assets that are used or
useful in a Permitted Business;
provided that the amount of (x) any liabilities (as shown on the Company's
or such Restricted Subsidiary's most recent balance sheet) of the Company
or any Restricted Subsidiary (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes or any
guarantee thereof) that are assumed
70
by the transferee of any such assets pursuant to a customary novation
agreement that releases the Company or such Restricted Subsidiary from
further liability and (y) any securities, notes or other obligations
received by the Company or any such Restricted Subsidiary from such
transferee that are promptly converted by the Company or such Restricted
Subsidiary into cash (to the extent of the cash received), shall be deemed
to be cash for purposes of this provision.
(b) Within 360 days after the receipt of any Net Proceeds from an Asset
Sale, the Company may apply such Net Proceeds, at its option:
(i) to permanently repay Senior Indebtedness (and to
correspondingly reduce commitments with respect thereto in the case of
revolving borrowings) of the Company or a Subsidiary Guarantor or
Indebtedness (and to correspondingly reduce commitments with respect
thereto in the case of revolving borrowings) of any Restricted Subsidiary
that is not a Subsidiary Guarantor; provided that, so long as the
provisions of Section 4.12 are in effect, only repayment of Senior
Indebtedness incurred under the Existing Credit Facility (but not any
refinancing thereof other than a credit facility with commercial banks and
other lenders) shall constitute a repayment of Indebtedness permitted
pursuant to this clause (i); or
(ii) to acquire a controlling interest or a joint venture
interest (to the extent otherwise permitted by the Indenture) in another
business or, the making of a capital expenditure or the acquisition of
other long-term assets, in each case, in a Permitted Business (or enter
into a binding commitment for any such expenditure or acquisition);
provided that such binding commitment shall be treated as a permitted
application of Net Proceeds from the date of such commitment until and only
until the earlier of (x) the date on which such expenditure or acquisition
is consummated and (y) the 180th day following the expiration of the
aforementioned 360 day period. If the expenditure or acquisition
contemplated by such binding commitment is not consummated on or before
such 180th day and the Company shall not have applied such Net Proceeds
pursuant to clause (i) above on or before such 180th day, such commitment
shall be deemed not to have been a permitted application of Net Proceeds at
any time;
provided that, so long as the provisions of Section 4.12 are in effect, the
Company may not apply Net Proceeds of a Significant Asset Sale pursuant to
clause (ii) above to satisfy its obligations to apply such proceeds pursuant to
this paragraph except to the extent that the provisions of the Existing Credit
Facility (but not any refinancing thereof other than a credit facility with
commercial banks and other lenders) require a mandatory prepayment from such
proceeds but the requisite lenders thereunder have waived such mandatory
prepayment.
Pending the final application of any such Net Proceeds, the Company may
temporarily reduce the revolving Indebtedness under the Existing Credit Facility
or otherwise invest such Net Proceeds in any manner that is not prohibited by
the Indenture.
71
Any Net Proceeds from Asset Sales that are not applied or invested as provided
in the first sentence of this Section 4.09(b) will be deemed to constitute
"Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds exceeds $25 million, the
Company will be required to make an offer to all Holders of Notes (an "Asset
Sale Offer") to purchase the maximum principal amount of Notes and, (x) if the
Company is required to do so under the terms of any other Indebtedness ranking
pari passu with such Notes, such other Indebtedness, and (y) if the Company
elects to do so, any Existing ARCO Chemical Debt, on a pro rata basis with the
Notes, that may be purchased out of the Excess Proceeds, at an offer price in
cash in an amount equal to 100% of the principal amount thereof plus accrued and
unpaid interest and Liquidated Damages, if any, thereon to the date of purchase,
in accordance with the procedures set forth herein.
To the extent that the aggregate amount of Notes (and any other pari passu
Indebtedness subject to such Asset Sale Offer) tendered pursuant to such Asset
Sale Offer is less than the Excess Proceeds, the Company may, subject to the
other terms of the Indenture, use any remaining Excess Proceeds for general
corporate purposes.
If the aggregate principal amount of Notes surrendered by Holders thereof
in connection with an Asset Sale Offer exceeds the amount of Excess Proceeds,
the Trustee shall select the Notes to be purchased on a pro rata basis.
Upon completion of the offer to purchase made under the Indenture, the
amount of Excess Proceeds shall be reset at zero.
(d) 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 any Asset
Sale Offer.
Section 4.10. Limitation on Affiliate Transactions. (a) The Company will
not, and will not permit any of its Restricted Subsidiaries to, sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or purchase
any property or assets from, or enter into or make any contract, agreement,
understanding, loan, advance or Guarantee with, or for the benefit of, any
Affiliate (each of the foregoing, an "Affiliate Transaction"), unless (i) such
Affiliate Transaction is on an arm's-length basis and (ii) the Company delivers
to the Trustee (a) with respect to any Affiliate Transaction involving aggregate
consideration in excess of $10 million, a Board Resolution set forth in an
Officers' Certificate certifying that such Affiliate Transaction complies with
clause (i) above and that such Affiliate Transaction has been approved by a
majority of the disinterested members of the Board of Directors and (b) with
respect to any Affiliate Transaction involving aggregate consideration in excess
of $25 million, an opinion as to the fairness to the Company or such Restricted
Subsidiary of such Affiliate Transaction from a financial point of view issued
by an investment banking firm of national standing; provided that:
(i) transactions or payments pursuant to any employment arrangements or
employee, officer or director benefit plans or arrangements entered into by the
Company or any of its Restricted Subsidiaries in the ordinary course of
business;
72
(ii) transactions between or among the Company and/or its Restricted
Subsidiaries;
(iii) any Restricted Payment permitted by Section 4.07 of the type
described in clause (i) or (ii) of the first paragraph thereof;
(iv) customary loans, advances, fees and compensation paid to, and
indemnity provided on behalf of, officers, directors, employees or consultants
of the Company or any of its Restricted Subsidiaries;
(v) transactions entered into on an arm's-length basis in the ordinary
course of business between the Company or any of its Restricted Subsidiaries and
any Joint Venture;
(vi) sales (including a sale in exchange for a promissory note of or
Equity Interest in such Accounts Receivable Subsidiary) of accounts receivable
and the provision of billing, collection and other services in connection
therewith, in each case, to an Accounts Receivable Subsidiary in connection with
any Receivables Facility; and
(vii) transactions pursuant to any contract or agreement in effect on the
date of the Indenture as the same may be amended, modified or replaced from time
to time so long as any such contract or agreement as so amended, modified or
replaced is, taken as a whole, no less favorable to the Company and its
Restricted Subsidiaries than the contract or agreement as in effect on the date
of the Indenture (as conclusively evidenced by a Board Resolution); in each
case, shall not be deemed to be Affiliate Transactions and therefore not subject
to the requirements of clauses (i) and (ii) of the initial sentence above.
Section 4.11. Limitation on Liens. (a) The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, create,
incur, assume or suffer to exist any Lien (except Permitted Liens) on any asset
now owned or hereafter acquired, or any income or profits therefrom, unless all
payments due under the Indenture and the Notes or the Subsidiary Guarantees are
secured on an equal and ratable basis with the obligations so secured (or, if
such obligations are subordinated by their terms to the Notes or the Subsidiary
Guarantees, prior to the obligations so secured) until such time as such
obligations are no longer so secured.
(b) The Company and its Subsidiaries shall also comply with the provisions
of Section 4.12(a) until such provisions cease to be in effect pursuant to
Section 4.12(b).
Section 4.12. Equal and Ratable Liens. (a) To the extent the Company or any
Subsidiary of the Company grants a Lien upon any of its property or assets to
secure the Existing Credit Facility Obligations, the Company or such Subsidiary,
as the case may be, shall, contemporaneously with the granting of such Lien,
secure the Indenture Obligations equally and ratably with the Existing Credit
Facility Obligations secured by such Lien.
73
(b) Notwithstanding the foregoing, from and after the date when all Liens
granted in favor of the holders of Existing Credit Facility Obligations are
released (and are not concurrently replaced with any new Liens on any asset of
the Company or any of its Restricted Subsidiaries securing Existing Credit
Facility Obligations), the provisions of this Section 4.12 will no longer apply.
The provisions of Section 4.11 will, however, continue to apply.
Section 4.13. No Amendment to Subordination Provisions. The Company will
not amend, modify or alter the Senior Subordinated Notes Indenture in any way
that would (i) increase the principal of, advance the final maturity date of or
shorten the Weighted Average Life to Maturity of any Senior Subordinated Notes
such that the final maturity date of the Senior Subordinated Notes is earlier
than the 91st day following the final maturity date of the Notes or (ii) amend
the subordination provisions of the Senior Subordinated Notes Indenture or any
of the defined terms used therein in a manner that would be adverse to the
holders of the Notes.
Section 4.14. Repurchase of Notes upon a Change in Control. (a) Upon the
occurrence of a Change of Control, each Holder will have the right to require
the Company to repurchase all or any part (equal to $1,000 or an integral
multiple thereof) of such Holder's Notes pursuant to the offer described below
(the "Change of Control Offer") at an offer price in cash equal to 101% of the
aggregate principal amount thereof plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the date of purchase (the "Change of
Control Payment") on a date that is not more than 90 days after the occurrence
of such Change of Control (the "Change of Control Payment Date"). Within 30 days
following any Change of Control, the Company will mail, or at the Company's
request the Trustee will mail, a notice to each Holder offering to repurchase
the Notes held by such Holder pursuant to the procedures specified in such
notice.
(b) 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 the Notes as a result of a Change of Control.
(c) On the Change of Control Payment Date, the Company will, to the extent
lawful, (1) accept for payment all Notes or portions thereof properly tendered
and not withdrawn pursuant to the Change of Control Offer, (2) deposit with the
Paying Agent an amount equal to the Change of Control Payment in respect of all
Notes or portions thereof so tendered, and (3) deliver or cause to be delivered
to the Trustee the Notes so accepted together with an Officer's Certificate
stating the aggregate principal amount of Notes or portions thereof being
purchased by the Company.
The Paying Agent will promptly mail to each Holder of Notes so
tendered the Change of Control Payment for such Notes, and the Trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a Note equal in principal amount to any unpurchased portion of the
Notes surrendered, if any; provided that each such Note will be in a principal
amount of $1,000 or an integral multiple thereof.
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(d) The Company will not be required to make a Change of Control Offer
upon a Change of Control if a third party makes the Change of Control Offer at
the same or a higher purchase price, at the same times and otherwise in
substantial compliance with the requirements applicable to a Change of Control
Offer made by the Company and purchases all Notes validly tendered and not
withdrawn under such Change of Control Offer.
Section 4.15. Limitation on Sale and Leaseback Transactions. The Company
will not, and will not permit any of its Restricted Subsidiaries to, enter into
any Sale and Leaseback Transaction; provided that the Company or any Restricted
Subsidiary may enter into a Sale and Leaseback Transaction if: (a) the Company
or such Restricted Subsidiary, as the case may be, could have (i) incurred
Indebtedness in an amount equal to the Attributable Debt relating to such Sale
and Leaseback Transaction pursuant to the Fixed Charge Coverage Ratio test set
forth in Section 4.06(a) (whether or not such covenant has ceased to be
otherwise in effect pursuant to Section 4.18) and (ii) incurred a Lien to secure
such Indebtedness pursuant to Section 4.11 without securing the Notes; and (b)
the gross cash proceeds of such Sale and Leaseback Transaction are at least
equal to the fair market value (as conclusively determined by the Board of
Directors) of the property that is the subject of such Sale and Leaseback
Transaction.
Section 4.16. Limitation on Line of Business. The Company will not, and
will not permit any of its Restricted Subsidiaries to, engage in any business
other than Permitted Businesses, except to such extent as would not be material
to the Company and its Subsidiaries taken as a whole.
Section 4.17. Limitation on Accounts Receivable Facilities. The Company
may, and any of its Restricted Subsidiaries may, sell (including a sale in
exchange for a promissory note of or an Equity Interest in such Accounts
Receivable Subsidiary) at any time and from time to time, accounts receivable to
any Accounts Receivable Subsidiary; provided that the aggregate consideration
received in each such sale is at least equal to the aggregate fair market value
of the receivables sold.
Section 4.18. Limited Applicability of Covenants when Notes are Rated
Investment-Grade. Notwithstanding the foregoing, the Company's and its
Restricted Subsidiaries' obligations to comply with the provisions of Sections
4.06, 4.07, 4.08, 4.09, 4.10, 4.16, 4.17 and 4.22 will terminate and cease to
have any further effect from and after the first date when the Notes are rated
Investment Grade.
Section 4.19. Existence. Subject to Articles 4 and 5 of this Indenture, the
Company will do or cause to be done all things necessary to preserve and keep in
full force and effect its existence and the existence of each of its Restricted
Subsidiaries in accordance with the respective organizational documents of the
Company and each such Subsidiary and the rights (whether pursuant to charter,
partnership certificate, agreement, statute or otherwise), material licenses and
franchises of the Company and each such Subsidiary; provided that the Company
shall not be required by this Section 4.19 to preserve any such right, license
or franchise, or the existence of any Restricted Subsidiary, if the Company
shall determine that the maintenance or preservation thereof
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is no longer desirable in the conduct of the business of the Company and its
Restricted Subsidiaries taken as a whole.
Section 4.20. Payment of Taxes and Other Claims. The Company will pay or
discharge and shall cause each of its Restricted Subsidiaries to pay or
discharge, or cause to be paid or discharged, before the same shall become
delinquent (a) all material taxes, assessments and governmental charges levied
or imposed upon (i) the Company or any such Subsidiary, (ii) the income or
profits of any such Subsidiary which is a corporation or (iii) the property of
the Company or any such Subsidiary and (b) all material lawful claims for labor
materials and supplies that, if unpaid, might by law become a lien upon the
property of the Company or any such Subsidiary; provided 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 the amount, applicability or validity of which
is being contested in good faith by appropriate proceedings and for which
adequate reserves have been established in accordance with GAAP.
Section 4.21. Maintenance of Properties and Insurance. The Company will
cause all material assets necessary in the conduct of its business or the
business of any of its Restricted Subsidiaries, to be maintained and kept in
good condition, repair and working order (ordinary wear and tear excepted) and
will cause to be made all necessary repairs, renewals and replacements thereof,
all as in the judgment of the Company may be necessary so that the business
carried on in connection therewith may be properly conducted at all times;
provided that nothing in this Section 4.21 shall prevent the Company or any such
Subsidiary from discontinuing the use, operation or maintenance of any of such
assets or disposing or abandoning of any of them, if such discontinuance,
disposal or abandonment is, in the judgment of the Company, desirable in the
conduct of the business of the Company or such Subsidiary.
The Company will maintain, and will cause each of its Restricted
Subsidiaries to maintain (either in the Company's name or in such Subsidiary's
own name) insurance on all their respective properties consistent with the
insurance maintained on the Issue Date or otherwise in at least such amounts
(with no materially greater risk retention) and against at least such risks as
are usually maintained, retained or insured against in the same general area by
companies of established repute owning similar properties in such area and
engaged in the same or a similar business, in either case, to the extent
available to the Company and its Restricted Subsidiaries on commercially
reasonable terms.
Section 4.22. Limitation on Issuance of Guarantees by Restricted
Subsidiaries. (a) The Company will not permit any Restricted Subsidiary that is
not a Subsidiary Guarantor, directly or indirectly, to Guarantee or secure the
payment of any other Indebtedness of the Company or any of its Restricted
Subsidiaries (except Indebtedness of such Restricted Subsidiary or a Restricted
Subsidiary of such Restricted Subsidiary) unless (i) such Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture in the form of
Exhibit B hereto providing for the Guarantee of the payment of the Notes by such
Restricted Subsidiary and shall deliver an Opinion of Counsel to the Trustee
pursuant to paragraph (c) below; provided that this paragraph shall not be
applicable to (x) any Guarantee of any Restricted Subsidiary that existed at the
time such Person became a Restricted Subsidiary and was not incurred in
connection
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with, or in contemplation of, such Person's becoming a Restricted Subsidiary,
(y) Guarantees of Indebtedness of a Restricted Subsidiary that is a Foreign
Subsidiary by a Restricted Subsidiary that is a Foreign Subsidiary or (z) the
granting of Liens by a Joint Venture Subsidiary to secure Indebtedness under the
Existing Credit Facility, the Existing Senior Secured Notes and the Notes. If
the Notes are (A) pari passu with the Guaranteed Indebtedness, then the
Subsidiary Guarantee shall be pari passu with, or senior to, the guarantee of
such Guaranteed Indebtedness or (B) senior to the Guaranteed Indebtedness, then
the Subsidiary Guarantee shall be senior to the guarantee of such Guaranteed
Indebtedness at least to the extent that the Notes are senior to such Guaranteed
Indebtedness.
(b) Notwithstanding the foregoing, each Subsidiary Guarantee by a
Restricted Subsidiary shall be automatically and unconditionally released and
discharged upon (i) any sale, exchange or transfer, to any Person not an
Affiliate of the Company, of all the Company's and each Restricted Subsidiary's
Capital Stock in such Restricted Subsidiary (which sale, exchange or transfer is
not prohibited by the Indenture) as provided in Section 5.03(b), (ii) the
release or discharge of the Guarantee which resulted in the creation of such
Subsidiary Guarantee (or, in the case of the Subsidiary Guarantees of ARCO
Chemical Technology, Inc., ARCO Chemical Technology, L.P. and Lyondell Chemical
Nederland, Ltd. issued on the Issue Date, the release or discharge of its
Guarantee of Indebtedness under the Existing Credit Facility and the Existing
Senior Secured Notes), except a discharge or release by or as a result of
payment under such Guarantee, and (iii) the designation of such Restricted
Subsidiary as an Unrestricted Subsidiary in accordance with the terms of the
Indenture.
(c) The Opinion of Counsel described above shall be to the effect that
such supplemental indenture has been duly authorized, executed and delivered by
such Subsidiary and constitutes a valid and binding obligation of such
Subsidiary, enforceable against such Subsidiary in accordance with its terms
(subject to customary exceptions).
Section 4.23. Payments for Consents. Neither the Company nor any of its
Subsidiaries or Affiliates will, 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 consent, waive or agree to amend such term or provision in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.
ARTICLE 5
Consolidation, Merger or Sale of Assets
Section 5.01. Consolidation, Merger or Sale of Assets by the Company. (a)
The Company may not consolidate or merge with or into (whether or not the
Company is the surviving corporation), or sell, assign, transfer, convey or
otherwise dispose of all or
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substantially all its assets in one or more related transactions, to another
corporation, Person or entity unless:
(i) the Company is the surviving corporation or the entity or the
Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, conveyance
or other disposition shall have been made is a corporation organized or
existing under the laws of the United States, any state thereof or the
District of Columbia;
(ii) the corporation formed by or surviving any such consolidation or
merger (if other than the Company) or the corporation to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made assumes all the Obligations of the Company under the Notes, the
Indenture and the Security Documents to which it is a party pursuant to a
supplemental indenture in form reasonably satisfactory to the Trustee;
(iii) immediately after such transaction no Default or Event of
Default exists; and
(iv) the company the entity or Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have
been made (A) will have a Consolidated Net Worth immediately after the
transaction equal to or greater than the Consolidated Net Worth of the
Company immediately preceding the transaction and (B) except with respect
to a consolidation or merger of the Company with or into a Person that has
no outstanding Indebtedness, will, at the time of such transaction and
after giving pro forma effect thereto as if such transaction had occurred
at the beginning of the applicable four-quarter period, be permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Fixed
Charge Coverage Ratio test set forth in Section 4.06(a). The foregoing
shall not prohibit the merger or consolidation of a Wholly Owned Restricted
Subsidiary with the Company; provided that, in connection with any such
merger or consolidation, no consideration (other than common stock in the
surviving Person or the Company) shall be issued or distributed to the
stockholders of the Company.
(b) The Company will not lease all or substantially all its assets to
another Person.
Section 5.02. Successor Company Substituted. (a) Except as provided in
Section 5.02(b), upon any consolidation or merger, or any sale, assignment,
transfer, conveyance or other disposition of all or substantially all the assets
of the Company in accordance with Section 5.01 hereof, the successor corporation
formed by such consolidation or into or with which the Company is merged or to
which such sale, assignment, transfer, conveyance or other disposition is made
shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, assignment, transfer, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer instead to the successor corporation), and may
78
exercise every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein,
and the predecessor Company shall be released from all its obligations hereunder
and under the Notes.
(b) The sale, assignment, transfer, lease, conveyance or other disposition
by the Company of all or substantially all its property or assets taken as a
whole to one or more of the Company's Subsidiaries shall not relieve the Company
from its obligations under the Indenture and the Notes.
Section 5.03. Consolidation, Merger or Sale of Assets by a Subsidiary
Guarantor. (a) No Subsidiary Guarantor may consolidate with or merge with or
into (whether or not such Subsidiary Guarantor is the surviving Person), another
corporation, Person or entity whether or not affiliated with such Subsidiary
Guarantor unless:
(i) subject to the provisions of Section 5.03(b) below, the Person
formed by or surviving any such consolidation or merger (if other than the
Company or such Subsidiary Guarantor) assumes all the obligations of such
Subsidiary Guarantor, pursuant to a supplemental indenture in form and
substance reasonably satisfactory to the Trustee, under the Notes;
(ii) immediately after giving effect to such transaction, no Default
or Event of Default exists; and
(iii) the Company would, at the time of such transaction and after
giving pro forma effect thereto as if such transaction had occurred at the
beginning of the applicable four-quarter period, (A) have a Consolidated
Net Worth immediately after the transaction equal to or greater than the
Consolidated Net Worth of the Company immediately preceding the transaction
and (B) except with respect to a consolidation or merger with a Person that
has no outstanding Indebtedness, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test
set forth in 4.06(a).
All the Subsidiary Guarantees issued pursuant to clause (i) above shall in
all respects have the same legal rank and benefit under this Indenture as the
Subsidiary Guarantees theretofore and thereafter issued in accordance with the
terms of this Indenture as though all such Subsidiary Guarantees had been issued
at the date of the execution hereof.
(b) (i) The requirements of clauses (i) and (iii) of Section 5.03(a)
will not apply in the case of a consolidation with or merger with or into the
Company and the requirements of clause (iii) of Section 5.03(a) will not apply
in the case of a consolidation with or merger with or into another Subsidiary
Guarantor.
(ii) In the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all the Capital Stock of any Subsidiary Guarantor
to any Person that is not an Affiliate of the Company permitted by the
applicable provisions of
79
the Indenture, such Subsidiary Guarantor will be released and relieved of any
obligations under its Subsidiary Guarantee; provided that the Net Proceeds of
such sale or other disposition are applied in accordance with the applicable
provisions of the Indenture.
Section 5.04. Opinion of Counsel to Trustee. The Trustee, subject to the
provisions of Sections 7.01 and 7.03, may receive an Opinion of Counsel as
conclusive evidence that any such consolidation, merger, conveyance, sale,
transfer, lease, exchange or other disposition referred to in Section 5.01 or
5.03 complies with the applicable provisions of this Indenture.
ARTICLE 6
Remedies
Section 6.01. Events of Default. Each of the following constitutes an
"Event of Default":
(a) a default in the payment of interest or any Liquidated Damages on the
Notes when due, which has continued for 30 days;
(b) a default in the payment when due of principal of or premium on, any
Note when due at its Stated Maturity, upon optional redemption, upon required
repurchase, upon declaration or otherwise;
(c) the failure by the Company to comply with its obligations under
Article 5, Section 4.09 or Section 4.14;
(d) the Company or any Subsidiary Guarantor defaults in the performance of
or breaches any other covenant or agreement in this Indenture or under the Notes
(other than (a), (b) or (c) above) and such default or breach continues for a
period of 60 consecutive days after written notice by the Trustee or the Holders
of 25% or more in aggregate principal amount of the Notes;
(e) any default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Significant
Subsidiaries (or any Indebtedness for money borrowed Guaranteed by the Company
or any of its Significant Subsidiaries if the Company or a Significant
Subsidiary does not perform its payment obligations under such Guarantee within
any grace period provided for in the documentation governing such Guarantee)
and, whether such Indebtedness or Guarantee exists on the date of the indenture
or is thereafter created, which default (a) constitutes a Payment Default or (b)
results in the acceleration of such Indebtedness prior to its Stated Maturity,
and in each case, the principal amount of any such Indebtedness, together with
the principal amount of any other such Indebtedness under which there has been a
Payment Default or that has been so accelerated, aggregates $50 million or more;
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(f) failure by the Company or any of its Significant Subsidiaries to pay a
final judgment or final judgments aggregating in excess of $50 million, which
judgment or judgments are not paid, discharged or stayed for a period of 60
days;
(g) a court having jurisdiction in the premises enters a decree or order
for (i) relief in respect of the Company or any Significant Subsidiary in an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, (ii) appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the Company or
any Significant Subsidiary or for all or substantially all the property and
assets of the Company or any Significant Subsidiary or (iii) the winding up or
liquidation of the affairs of the Company or any Significant Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a period
of 60 consecutive days;
(h) the Company or any Significant Subsidiary (i) commences a voluntary
case under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consents to the entry of an order for relief in an
involuntary case under any such law, (ii) consents to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Company or any Significant Subsidiary or
for all or substantially all the property and assets of the Company or any
Significant Subsidiary or (iii) effects any general assignment for the benefit
of creditors;
(i) except as permitted by the Indenture, any Subsidiary Guarantee issued
hereunder shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or any
Subsidiary Guarantor, or any Person acting on behalf of any Subsidiary
Guarantor, shall deny or disaffirm its obligations under the Subsidiary
Guarantees issued thereunder; or
(j) any of the Security Documents ceases to be in full force and effect,
or any of the Security Documents ceases to give the holders of the Notes any of
the Liens purported to be created thereby, or any of the Security Documents is
declared null and void or the Company or any Restricted Subsidiary denies in
writing that it has any further liability under any Security Document or gives
written notice to such effect (in each case other than in accordance with the
terms of this Indenture (including Section 14.01(b)) or the terms of the
Existing Credit Facility or the Security Documents (including the cessation of
effectiveness of any Security Document in connection with a release of all
collateral covered thereby in accordance with the terms of this Indenture, the
Existing Credit Facility, the Existing Senior Secured Note Indentures and such
Security Document) or unless waived by the requisite lenders under the Existing
Credit Facility if, after the waiver, the Company is in compliance with Section
4.12; provided that if a failure of the sort described in this clause (j) is
susceptible of cure, no Event of Default shall arise under this clause (j) with
respect thereto until 30 days after notice of such failure shall have been given
to the Company by the Trustee or the Holders of at least 25% in principal amount
of the then outstanding Notes issued under the Indenture.
Section 6.02. Acceleration. If an Event of Default (other than an Event of
Default specified in clause (g) or (h) of Section 6.01 that occurs with respect
to the
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Company or any Subsidiary Guarantor) occurs and is continuing under this
Indenture, the Trustee or the Holders of at least 25% in aggregate principal
amount of the Notes then Outstanding, by written notice to the Company (and to
the Trustee if such notice is given by the Holders (the "Acceleration Notice")),
may, and the Trustee at the request of such Holders shall, declare the principal
of, premium, if any, and accrued but unpaid interest and Liquidated Damages, if
any, on all the Notes to be due and payable. Upon a declaration of acceleration,
such principal, premium, if any, and accrued interest and Liquidated Damages, if
any, shall be immediately due and payable. If an Event of Default specified in
clause (g) or (h) of Section 6.01 occurs with respect to the Company or any
Subsidiary Guarantor, the principal of, premium, if any, accrued interest and
Liquidated Damages, if any, on the Notes then Outstanding shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder.
Section 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal or interest and Liquidated Damages on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding. A delay or omission
by the Trustee or any Holder in exercising any right or remedy accruing upon an
Event of Default shall not impair the right or remedy or constitute a waiver of
or acquiescence in the Event of Default. All remedies are cumulative to the
extent permitted by law.
Section 6.04. Waiver of Past Defaults. The Holders of at least a majority
in principal amount of the outstanding Notes, by written notice to the Company
and to the Trustee, may waive all past defaults and rescind and annul a
declaration of acceleration and its consequences under the Notes, if (i) all
existing Events of Default, other than the nonpayment of the principal of and
premium, if any, and interest and Liquidated Damages, if any, on such Notes that
have become due solely by such declaration of acceleration, have been cured or
waived and (ii) the rescission would not conflict with any judgment or decree of
a court of competent jurisdiction. Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.
Section 6.05. Control by Majority. The Holders of at least a majority in
aggregate principal amount of the Outstanding Notes may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on the Trustee. However, the Trustee
may refuse to follow any direction that conflicts with law or this Indenture,
that may involve the Trustee in personal liability, or that the Trustee
determines in good faith may be unduly prejudicial to the rights of Holders not
joining in the giving of such direction and may take any other action it deems
proper that is not inconsistent with any such direction received from the
Holders.
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Section 6.06. Limitation on Suits. A Holder may not pursue any remedy with
respect to this Indenture or the Notes unless:
(a) the Holder gives the Trustee written notice of a continuing Event of
Default;
(b) the Holders of at least 25% in aggregate principal amount of
Outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder or Holders offer the Trustee security or indemnity
satisfactory to it against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt thereof and the offer of security or indemnity; and
(e) during such 60 day period, the Holders of at least a majority in
aggregate principal amount of the Outstanding Notes do not give the Trustee a
direction inconsistent with the request.
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, premium, if any, interest and Liquidated Damages, if any, on the
Note, on or after the respective due dates expressed in the Note, or to bring
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of the Holder.
Section 6.08. Collection Suit by Trustee. If an Event of Default specified
in Section 6.01(a) or (b) hereof occurs and is continuing, the Trustee is
authorized to recover judgment in its own name and as trustee of an express
trust against the Company or any other obligor for the whole amount of
principal, premium, if any, and interest and Liquidated Damages, if any,
remaining unpaid on the Notes and interest on overdue principal and, to the
extent lawful, interest and Liquidated Damages, if any, and such further amount
as shall be sufficient to cover amounts due the Trustee under Section 7.08,
including 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 is authorized
to 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 Holders 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,
receive and distribute any money or other property payable or deliverable on any
such claims and any custodian in any such judicial proceeding is hereby
authorized by each Holder 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
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses,
83
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.08. To the extent that the payment of
any such compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under Section 7.08 out
of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties which the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder in any such proceeding.
Section 6.10. Priorities. If the Trustee collects any money pursuant to
this Article or receives any money from the Collateral Agent as the distribution
of proceeds received upon realization of any Collateral, it shall pay out the
money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 7.08, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection;
Second: to Holders for amounts due and unpaid on the Notes for principal,
premium, if any, interest and Liquidated Damages, if any, ratably, without
preference or priority of any kind, according to the amounts due and payable on
the Notes for principal, premium, if any, interest and Liquidated Damages,
respectively; and
Third: to the Company or to such party as a court of competent jurisdiction
shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.10 upon five Business Days prior notice to
the Company.
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 a 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 and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.06, or a suit by
Holders of more than 10% in aggregate principal amount of the then Outstanding
Notes.
Section 6.12. Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture or any Note and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to the Trustee or to such Holder,
then and in every such case
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the Company, any other obligor upon the Notes, the Trustee and the Holders
shall, subject to any determination in such proceeding, be restored severally
and respectively to their former positions hereunder, and thereafter all rights
and remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
Section 6.13. Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 6.14. 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, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other similar
law wherever enacted, now or at any time hereafter in force, that would prohibit
or forgive the Company from paying all or any portion of the principal of (or
premium, if any), interest or Liquidated Damages, if any, on the Notes
contemplated herein or in the Notes or that may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenant 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.
ARTICLE 7
The Trustee
Section 7.01. Certain Duties and Responsibilities. (a) Except during the
continuance of an Event of Default,
(i) the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
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 examine the certificates and opinions 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).
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(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that (i) this paragraph does not
limit the effect of Section 7.01(a); (ii) the Trustee shall not be liable for
any error of judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it takes or
omits to take in good faith in accordance with a direction received by it
pursuant to Section 6.06.
(d) The Trustee may refuse to perform any duty or exercise any right or
power or expend or risk its own funds or otherwise incur any financial liability
unless it receives indemnity satisfactory to it against any loss, liability or
expense.
(e) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of Sections 7.01
and 7.03.
Section 7.02. Notice of Defaults. (a) Within 90 days after the occurrence
of any Default, the Trustee shall transmit by mail to all Holders, as their
names and addresses appear in the Register, notice of such Default hereunder
actually known to the Trustee unless such Default shall have been cured or
waived; provided, however, that, except in the case of a Default in the payment
of the principal of, premium (if any) or interest and Liquidated Damages, if
any, on, any Note, the Trustee may withhold such notice if and so long as the
board of directors, the executive committee or a trust committee of Responsible
Officers of the Trustee determines that the withholding of such notice is not
opposed to the interests of the Holders.
(b) The Trustee shall not be required to take notice or be deemed to have
notice or knowledge of any event or of any Default (except default in the
payment of monies to the Trustee which are required to be paid to the Trustee on
or before a specified date or within a specified time after receipt by the
Trustee of a notice or a certificate which was in fact received), unless the
Trustee shall receive from the Company or a Holder a notice stating that the
same has occurred and is continuing, and specifying the same, and in the absence
of such notice the Trustee may conclusively assume that the same does not exist,
except as aforesaid.
Section 7.03. Certain Rights of Trustee. Subject to the provisions of
Section 7.01:
(i) the Trustee may conclusively rely and shall be protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, note, other
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evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(ii) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or a Company Order thereof,
and any resolution of any Person's board of directors (or any committee
thereof) shall be sufficiently evidenced if certified by an Officer of such
Person as having been duly adopted and being in full force and effect on
the date of such certificate;
(iii) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon the Officer's Certificates of the Company;
(iv) the Trustee may consult with counsel of its selection and the
written advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon;
(v) in case an Event of Default occurs and is continuing, the
Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee security or indemnity satisfactory to it against any
loss, liability or expense which might be incurred by it in compliance with
such request or direction;
(vi) 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, note, other evidence of indebtedness or other paper or document;
(vii) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder; and
(viii) the rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in
each of its capacities hereunder, and to each agent, custodian and other
Person employed to act hereunder.
Section 7.04. Not Responsible for Recitals or Issuance of Notes. The
recitals contained herein and in the Notes, except the Trustee's certificates of
authentication, shall be taken as the statements of the Company, and neither the
Trustee nor any Authenticating Agent assumes any responsibility for their
correctness. The Trustee
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makes no representations as to the validity or sufficiency of this Indenture or
of the Notes, except that the Trustee represents that it is duly authorized to
execute and deliver this Indenture, authenticate the Notes and perform its
obligations hereunder and that the statements made by it in a Statement of
Eligibility and Qualification on Form T-1 supplied to the Company in connection
with the registration of any Notes issued hereunder will be true and accurate
subject to the qualifications set forth therein. Neither the Trustee nor any
Authenticating Agent shall be accountable for the use or application by the
Company of the Notes or the proceeds thereof.
Section 7.05. Trustee's Disclaimer. The Trustee makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company' use of the proceeds from the Notes, it shall not be
responsible for any statement in the offering memorandum for the Notes or in the
Indenture or the Notes (other than its certificate of authentication), the acts
of a prior Trustee hereunder, or the determination as to which beneficial owners
are entitled to receive any notices hereunder.
Section 7.06. May Hold Notes. The Trustee, any Authenticating Agent, any
Paying Agent, any Registrar or any other agent of the Company, in its individual
or any other capacity, may become the owner or pledgee of Notes and, subject to
Section 7.09 and Section 7.14, may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Registrar or such other agent.
Section 7.07. Money Held in Trust. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
Section 7.08. Compensation and Reimbursement. The Company agrees:
(a) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(b) to reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Indenture (including the reasonable compensation and the
expenses, advances and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negligence or bad
faith; and
(c) to indemnify the Trustee and any predecessor Trustee for, and to hold
it harmless against, any loss, damage, claims, liability or expense (including
taxes, other than taxes based on the income of the Trustee) incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this trust, including the reasonable costs and
expenses of defending itself against any claim
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(whether asserted by the Company, a Holder or any other person) or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
The Company' payment obligations pursuant to this Section 7.08 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(g) or 6.01(h), the
expenses are intended to constitute expenses of administration under any
Bankruptcy Law.
Section 7.09. Conflicting Interests. If the Trustee has or shall acquire a
conflicting interest within the meaning of the TIA, within 90 days the Trustee
shall either eliminate such conflicting interest, apply to the SEC for
permission to continue as Trustee with such conflicting interest, or resign, to
the extent and in the manner provided by, and subject to the provisions of, the
TIA and this Indenture. To the extent permitted by such Act, the Trustee shall
not be deemed to have a conflicting interest by virtue of being a trustee under
this Indenture with respect to Original Notes and Additional Notes, or a trustee
under any other indenture between the Company and the Trustee.
Section 7.10. Corporate Trustee Required; Eligibility. (a) There shall at
all times be one (and only one) Trustee hereunder. The Trustee shall be a Person
that is eligible pursuant to the TIA to act as such and has a combined capital
and surplus of at least $100,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section 7.10
and to the extent permitted by the TIA, the combined capital and surplus of such
Person shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
7.10, it shall resign immediately in the manner and with the effect hereinafter
specified in this Article.
Section 7.11. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 7.12.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company. If the instrument of acceptance by a successor Trustee required by
Section 7.12 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Notes, delivered to the Trustee
and to the Company. If the instrument of acceptance by a successor Trustee
required by Section 7.12 shall not have been delivered to the Trustee within 30
days after the giving of such notice of removal, the Trustee being removed may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
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If at any time:
(i) the Trustee shall fail to comply with Section 7.09 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder for at least six months, or
(ii) the Trustee shall cease to be eligible under Section 7.10 and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(iii) the Trustee shall become incapable of acting or shall be
adjudged bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company may remove the Trustee, or (B) subject
to Section 6.11, any Holder who has been a bona fide Holder for at least six
months may, on behalf of itself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee or Trustees.
(d) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company
shall promptly appoint a successor Trustee and shall comply with the applicable
requirements of Section 7.12. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
shall be appointed by Act of the Holders of a majority in principal amount of
the Outstanding Notes delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of Section 7.12,
become the successor Trustee and to that extent supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted appointment in the manner required by
Section 7.12, then, subject to Section 6.11, any Holder who has been a bona fide
Holder for at least six months may, on behalf of itself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(e) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee to all Holders in the
manner provided in Section 1.10. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.
Section 7.12. Acceptance of Appointment by Successor. (a) In case of the
appointment hereunder of a successor Trustee, every such successor Trustee so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights,
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powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder.
(b) Upon request of any such successor Trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to above.
(c) No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article 7.
Section 7.13. Merger, Conversion, Consolidation or Succession to Business.
(a) Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article 7,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Notes shall have been authenticated, but
not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Notes so authenticated with the same effect as if
such successor Trustee had itself authenticated such Notes.
Section 7.14. Preferential Collection of Claims Against the Company. (a) If
and when the Trustee shall be or become a creditor of the Company (or any other
obligor upon the Notes), the Trustee shall be subject to the provisions of the
TIA regarding the collection of claims against the Company (or any such other
obligor).
Section 7.15. Appointment of Authenticating Agent. The Trustee may appoint
an Authenticating Agent acceptable to the Company to authenticate the Notes. Any
such appointment shall be evidenced by an instrument in writing signed by a
Responsible Officer, a copy of which instrument shall be promptly furnished to
the Company. Unless limited by the terms of such appointment, an Authenticating
Agent may authenticate Notes whenever the Trustee may do so. Each reference in
this Indenture to authentication (or execution of a certificate of
authentication) by the Trustee includes authentication (or execution of a
certificate of authentication) by such Authenticating Agent. An Authenticating
Agent has the same rights as any Registrar, Paying Agent or agent for service of
notices and demands.
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ARTICLE 8
Holders' List and Reports by Trustee and the Company
Section 8.01. The Company to Furnish Trustee Names and Addresses of
Holders; Stock Exchange Listing. (a) The Company will furnish or cause to be
furnished to the Trustee
(i) semi-annually, not more than 15 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date, and
(ii) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a list
of similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Registrar, no
such list need be furnished pursuant to this Section 8.01.
(b) The Company will promptly notify the Trustee when any Notes are listed
on any stock exchange and of any delisting thereof.
Section 8.02. Preservation of Information; Communications to Holders. (a)
The Trustee shall preserve, in as current a form as is reasonably practicable,
the names and addresses of Holders contained in the most recent list, if any,
furnished to the Trustee as provided in Section 8.01 and the names and addresses
of Holders received by the Trustee in its capacity as Registrar; provided,
however, that if and so long as the Trustee shall be the Registrar, the Register
shall satisfy the requirements relating to such list. None of the Company, the
Trustee or any other Person shall be under any responsibility with regard to the
accuracy of such list. The Trustee may destroy any list furnished to it as
provided in Section 8.01 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Notes, and the corresponding
rights and privileges of the Trustee, shall be as provided by the TIA.
(c) Every Holder, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company nor the Trustee nor any agent
of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the TIA.
Section 8.03. Reports by Trustee. The Trustee shall transmit to Holders
such reports concerning the Trustee and its actions under this Indenture as may
be required pursuant to the TIA at the times and in the manner provided pursuant
thereto. If required by Section 313(a) of the TIA, the Trustee shall, within 60
days after each May 15, following the date of this Indenture deliver to Holders
a brief report, dated as of such May 15, which complies with the provisions of
such Section 313(a). A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee
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with each stock exchange, if any, upon which any Notes are listed, with the SEC
and with the Company.
ARTICLE 9
Amendment, Supplement or Waiver
Section 9.01. Without Consent of the Holders. (a) Without the consent of
any Holder, the Company and the Trustee may enter into one or more indentures
supplemental hereto, for any of the following purposes:
(i) to cure any ambiguity, omission, defect or inconsistency,
(ii) to provide for the assumption by a successor of the
obligations of the Company under this Indenture,
(iii) to provide for uncertificated Notes in addition to or in
place of certificated Notes; provided that the uncertificated Notes are
issued in registered form for purposes of Section 163(f) of the Code, or in
a manner such that the uncertificated Notes are described in Section
163(f)(2)(B) of the Code,
(iv) to add Subsidiary Guarantees with respect to the Notes, to
grant a Lien under this Indenture to the Trustee as security for the Notes,
to confirm and evidence the release, termination or discharge of any
Subsidiary Guarantee or any such Lien with respect to or securing the Notes
when such release, termination or discharge is permitted under this
Indenture,
(v) to add to the covenants of the Company for the benefit of
the Holders or to surrender any right or power conferred upon the Company,
(vi) to provide for or confirm the issuance of Additional Notes
in accordance with the terms of the Indenture,
(vii) to make any change that does not adversely affect the rights
of any Holder under the Notes or this Indenture, or
(viii) to comply with any requirement of the SEC in connection with
the qualification of this Indenture under the TIA or otherwise.
Section 9.02. With Consent of Holders. (a) Subject to Section 6.07, the
Company, the Trustee and (if applicable) any Subsidiary Guarantor may amend or
supplement this Indenture or the Notes with the written consent of the Holders
of not less than a majority in aggregate principal amount of the Outstanding
Notes, and any past Default or compliance with any provisions may also be waived
with the written consent
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of the Holders of not less than a majority in aggregate principal amount of the
Outstanding Notes.
(b) Notwithstanding the provisions of this Section 9.02, without the
consent of each Holder affected, an amendment or waiver, including a waiver
pursuant to Section 6.04, may not (with respect to any Notes held by a non-
consenting Holder):
(i) change the Stated Maturity of the principal of, or any
installment of interest on, any Note,
(ii) reduce the principal amount of or premium, if any, or interest
or Liquidated Damages, if any, on any Note,
(iii) reduce any amount payable on redemption of the Notes or upon
the occurrence of an Event of Default or reduce the Change of Control
Payment or the amount to be paid in connection with an Asset Sale Offer,
(iv) change the place or currency of payment of principal of or
premium, if any, or interest or Liquidated Damages, if any, on any Note,
(v) impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity (or, in the case of a redemption,
on or after the Redemption Date) of any Note,
(vi) reduce the above-stated percentage of outstanding Notes the
consent of whose Holders is necessary to modify or amend the Indenture,
(vii) waive a default in the payment of principal of or premium, if
any, or interest or Liquidated Damages, if any, on the Notes (except as set
forth in Section 6.04),
(viii) reduce the percentage or aggregate principal amount of
outstanding Notes the consent of whose Holders is necessary for waiver of
compliance with provisions of the Indenture or for waiver of Defaults,
(ix) modify or change any provision of the Indenture affecting the
ranking of the Notes or the Subsidiary Guarantees in a manner adverse to
the Holders of the Notes,
(x) release any Subsidiary Guarantor from any of its obligations
under its Subsidiary Guarantee or the Indenture other than in accordance
with the provisions of the Indenture, or amend or modify any provision
relating to such release, or
(xi) directly or indirectly release the Liens created by the
Security Documents on all or substantially all the Collateral (other than
in accordance with the terms of the Existing Credit Facility or the
Security Documents or with
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the consent of the requisite lenders under the Existing Credit Facility if,
after such consent, the Company is in compliance with Section 4.12).
(c) It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
(d) After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holders of each Note affected
thereby, with a copy to the Trustee, 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 supplemental indenture or the effectiveness of any such amendment,
supplement or waiver.
Section 9.03. Execution of Amendments, Supplements or Waivers. The Trustee
shall sign any amendment, supplement or waiver authorized pursuant to this
Article 9 if the amendment, supplement or waiver does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign it. In signing or refusing to sign such
amendment, supplement or waiver, the Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel to the effect that the execution of such amendment,
supplement or waiver has been duly authorized, executed and delivered by the
Company and that such amendment, supplement or waiver is a valid and binding
agreement of the Company, enforceable against it in accordance with its terms
(subject to customary exceptions).
Section 9.04. Revocation and Effect of Consents. (a) Until an amendment,
supplement or waiver becomes effective, a consent to it by a Holder is a
continuing consent by the Holder and every subsequent Holder of that Note or any
Note that evidences all or any part of 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 of this Section 9.04, any such Holder or subsequent Holder
may revoke the consent as to such Holder's Note by notice to the Trustee or the
Company received by the Trustee or the Company, as the case may be, before the
date on which the Trustee receives an Officer's 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 as set forth in Section 1.08.
(b) After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in any of clauses (i)
through (viii) of Section 9.02(b). In that case, the amendment, supplement or
waiver shall bind each Holder of a Note who has consented to it and every
subsequent Holder of such Note or any Note that evidences all or any part of the
same debt as the consenting Holder's Note.
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Section 9.05. Conformity with TIA. (a) Every amendment or supplemental
indenture executed pursuant to this Article shall conform to the requirements of
the TIA as then in effect.
Section 9.06. Notation on or Exchange of Notes. (a) If an amendment,
supplement or waiver changes the terms of a Note, the Trustee shall (if required
by the Company and in accordance with the specific direction of the Company)
request the Holder to deliver its Note to the Trustee. The Trustee shall (if
required by the Company and in accordance with the specific written direction of
the Company) 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
determines, the Company in exchange for the Note 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.
ARTICLE 10
Redemption of Notes
Section 10.01. Right of Redemption. The Notes will not be redeemable at the
option of the Company prior to December 15, 2005. Thereafter, the Notes will be
redeemable, at the option of the Company, in whole or in part, at any time or
from time to time on and prior to maturity. Such redemption may be made upon
notice mailed by first-class mail to each Holder's registered address in
accordance with Section 10.05. The Notes will be so redeemable at the following
Redemption Prices (expressed as a percentage of principal amount on the relevant
Redemption Date), plus accrued and unpaid interest and Liquidated Damages, if
any, to the relevant Redemption Date, if redeemed during the twelve-month period
commencing on December 15 of the years set forth below:
Redemption
Year Price
---- --------------
2005................................. 104.750%
2006................................. 102.375%
2007 and thereafter.................. 100.000%
Section 10.02. Applicability of Article. Redemption or purchase of Notes as
permitted by Section 10.01 shall be made in accordance with this Article 10.
Section 10.03. Election to Redeem; Notice to Trustee. In case of any
redemption at the election of the Company of the Notes, the Company shall, at
least 30 days prior to the Redemption Date initially fixed by the Company
(unless a shorter
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notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date and of the principal amount of Notes to be redeemed.
Section 10.04. Selection by Trustee of Notes to Be Redeemed. In the case of
any partial redemption, selection of the Notes for redemption will be made not
more than 60 days prior to the Redemption Date by the Trustee in compliance with
the requirements of the principal national securities exchange, if any, on which
the Notes are listed or, if the Notes are not so listed, on a pro rata basis, by
lot or by such method as the Trustee shall deem fair and appropriate; provided
that no Notes of $1,000 or less shall be redeemed in part.
(a) The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the portion of the principal amount thereof to be redeemed. On and
after the Redemption Date, interest and Liquidated Damages will cease to accrue
on Notes or portions thereof called for redemption.
(b) For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Notes shall relate, in
the case of any Note redeemed or to be redeemed only in part, to the portion of
the principal of such Note that has been or is to be redeemed.
Section 10.05. Notice of Redemption. (a) Notice of redemption or purchase
as provided in Section 10.01 shall be deemed to have been given upon the mailing
by first class mail, postage prepaid, of such notice to each Holder of Notes to
be redeemed, at its registered address as recorded in the Register, not later
than 30 nor more than 60 days prior to the Redemption Date.
Any such notice shall state:
(i) the expected Redemption Date,
(ii) the Redemption Price,
(iii) if less than all Outstanding Notes are to be redeemed, the
identification (and, in the case of partial redemption, the respective
principal amounts) of the particular Notes to be redeemed,
(iv) that on the Redemption Date the Redemption Price will become
due and payable upon each such Note to be redeemed, and that, unless the
Company default in making such redemption payment or any Paying Agent is
prohibited from making such payment pursuant to the terms of this
Indenture, interest and Liquidated Damages thereon shall cease to accrue
from and after said date,
(v) the place or places where such Notes are to be surrendered for
payment of the Redemption Price and the name and address of the Paying
Agent or Paying Agents,
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(vi) the CUSIP and other security identification numbers, if any,
subject to Section 3.12 hereof, and
(vii) the section of this Indenture pursuant to which the Notes are
to be redeemed.
Notices of redemption may not be conditional.
(b) Notice of such redemption or purchase of Notes to be so redeemed or
purchased at the election of the Company shall be given by the Company or, at
the written request of the Company delivered at least five Business Days prior
to the date proposed for the mailing of such notice, by the Trustee in the name
and at the expense of the Company; provided that such notice to the Trustee may
be revoked by the Company by written notice delivered to the Trustee prior to
the date proposed for the mailing of the notice of such redemption to the
Holders.
(c) The notice if mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Note designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Note.
Section 10.06. Deposit of Redemption Price. (a) On or prior to 10:00 a.m.,
New York City time on any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, the Company shall segregate and hold in trust as provided in Section
4.03) an amount of money sufficient to pay the Redemption Price of, and any
accrued and unpaid interest and Liquidated Damages, if any, on, all the Notes or
portions thereof which are to be redeemed on that date.
Section 10.07. Notes Payable on Redemption Date. (a) Notice of redemption
having been given as provided in this Article 10, the Notes so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
herein specified and from and after such date (unless Company shall default in
the payment of the Redemption Price or any Paying Agent is prohibited from
paying the Redemption Price pursuant to the terms of this Indenture) such Notes
shall cease to bear interest and Liquidated Damages. Upon surrender of such
Notes for redemption in accordance with such notice, such Notes shall be paid by
the Company at the Redemption Price. Installments of interest and Liquidated
Damages, if any, whose Interest Payment Date is on or prior to the Redemption
Date shall be payable to the Holders of such Notes registered as such on the
relevant Regular Record Dates according to their terms and the provisions of
Section 3.07.
(b) On and after any Redemption Date, if money sufficient to pay the
Redemption Price of and any accrued and unpaid interest and Liquidated Damages
on Notes called for redemption shall have been made available in accordance with
Section 10.06, the Notes (or the portions thereof) called for redemption will
cease to accrue
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interest and Liquidated Damages and the only right of the Holders of such Notes
(or portions thereof) will be to receive payment of the Redemption Price of, and
subject to the last sentence of Section 10.07(a), any accrued and unpaid
interest and Liquidated Damages, if any, on such Notes (or portions thereof) to
the Redemption Date. If any Note (or portion thereof) called for redemption
shall not be so paid upon surrender thereof for redemption, the principal (and
premium, if any) shall, until paid, bear interest and Liquidated Damages from
the Redemption Date at the rate borne by the Note (or portion thereof).
Section 10.08. Notes Redeemed in Part. Any Note that is to be redeemed only
in part shall be surrendered at a Place of Payment (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing) and the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Note without service charge, a new Note or Notes, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to
and in exchange for the unredeemed portion of the principal of the Note so
surrendered.
ARTICLE 11
Satisfaction and Discharge
Section 11.01. Satisfaction and Discharges of Indenture. (a) This Indenture
shall cease to be of further effect (except as to any surviving rights of
transfer or exchange of Notes herein provided for), and the Trustee, on demand
of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when
(i) either
(A) all Notes theretofore authenticated and delivered (other
than (y) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 3.06, and (z) 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, as provided in Section
4.03) have been delivered to the Trustee canceled or for cancellation;
or
(B) all such Notes not theretofore delivered to the Trustee
canceled or for cancellation
(x) have become due and payable, or
(y) will become due and payable at their Stated
Maturity within one year, or
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(z) are to be called for redemption within one year
under arrangements reasonably satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company,
(ii) the Company has irrevocably deposited or caused to be deposited
with the Trustee an amount in United States dollars, U.S. Government
Obligations, or a combination thereof, sufficient to pay and discharge the
entire Indebtedness on such Notes not theretofore delivered to the Trustee
canceled or for cancellation, for principal (and premium, if any) and
interest and Liquidated Damages to the date of such deposit (in the case of
Notes that have become due and payable), or to the Stated Maturity or
Redemption Date, as the case may be;
(iii) the Company has paid or caused to be paid all other sums then
payable hereunder by the Company; and
(iv) the Company has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each to the effect that all
conditions precedent provided for in this Section 11.01 relating to the
satisfaction and discharge of this Indenture have been complied with;
provided that any such counsel may rely on any Officer's Certificate as to
matters of fact (including as to compliance with the foregoing clauses (i),
(ii) and (iii)).
(b) Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 7.08 and, if money shall
have been deposited with the Trustee pursuant to clause (ii) of Section
11.01(a), the obligations of the Trustee under Section 11.02, shall survive.
Section 11.02. Application of Trust Money. Subject to the provisions of the
last paragraph of Section 4.03, all money deposited with the Trustee pursuant to
Section 11.01 shall be held in trust and applied by it, in accordance with the
provisions of the Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own Paying Agent)
as the Trustee may determine, to the Persons entitled thereto, of the principal
(and premium, if any) and interest and Liquidated Damages on the Notes; but such
money need not be segregated from other funds except to the extent required by
law.
ARTICLE 12
Defeasance and Covenant Defeasance
Section 12.01. Option of the Company to Effect Defeasance or Covenant
Defeasance. The Company may at its option by a Board Resolution, at any time,
elect to have either Section 12.02 or Section 12.03 applied to the Outstanding
Notes upon compliance with the conditions set forth below in this Article 12.
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Section 12.02. Legal Defeasance and Discharge. Upon the exercise by the
Company under Section 12.01 of the option applicable to this Section 12.02, the
Company shall be deemed to have been discharged from any and all Obligations
with respect to all Outstanding Notes (and any Subsidiary Guarantor will be
discharged from any and all Obligations in respect of its Subsidiary Guarantee)
on the date which is the 123rd day after the deposit referred to in Section
12.04(a); provided that all of the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, such Legal Defeasance means
that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the Outstanding Notes, which shall thereafter be
deemed to be "outstanding" only for the purposes of Section 12.05 hereof and the
other Sections of this Indenture referred to in clauses (i) and (ii) of this
Section 12.02, and to have satisfied all its other 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), 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 12.04 hereof, and as more fully
set forth in such Section, payments in respect of the principal of, premium, if
any, and interest and Liquidated Damages on such Notes when such payments are
due, (ii) the obligations of the Company with respect to such Notes under
Sections 1.06, 2.03, 3.03, 3.04, 3.05, 3.06, 3.13, 3.14, 4.01, 4.02, 4.03 and
12.05 hereof, (iii) the rights, powers, trusts, duties and immunities of the
Trustee hereunder, including, without limitation, the Trustee's rights under
Section 7.08 hereof, and the obligations of the Company in connection therewith
and with this Article 12. Subject to compliance with this Article 12, the
Company may exercise its option under this Section 12.02 notwithstanding the
prior exercise of its option under Section 12.03 hereof with respect to the
Notes.
Section 12.03. Covenant Defeasance. Upon the exercise by the Company under
Section 12.01 of the option applicable to this Section 12.03, the Company shall
be released from its obligations under the covenants contained in Sections 4.06
through Section 4.18, Section 4.22, Article 14 and clause (iv) of Section
5.01(a) hereof with respect to the Outstanding Notes and no Default under
Section 6.01(e), (f) and (g) shall thereafter constitute a Default or Event of
Default on the date which is the 123rd day after the deposit referred to in
Section 12.04(a); provided that all of the conditions set forth below are
satisfied (hereinafter, "Covenant Defeasance"), and the Notes 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. For this purpose, such Covenant Defeasance means
that, with respect to the Outstanding Notes, the Company may omit to comply with
and shall have no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.01(c) or (d), but, except as specified above, the remainder of
this Indenture and such Notes shall be unaffected thereby.
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Section 12.04. Conditions to Legal or Covenant Defeasance. The following
shall be the conditions to application of either Section 12.02 or Section 12.03
to the Outstanding Notes:
(a) the Company has deposited with the Trustee, in trust, money and/or
U.S. Government Obligations that through the payment of interest and principal
in respect thereof in accordance with their terms will provide money in an
amount sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee, to pay (i) the principal of, premium, if any, and accrued interest and
Liquidated Damages, if any, on the Notes when such payments are due in
accordance with the terms of this Indenture and the Notes or (ii) in the case of
Legal Defeasance, accrued interest and Liquidated Damages, if any, on the Notes
through a scheduled redemption date and the principal of, and premium on the
Notes on such redemption date; provided that, at the time of deposit, the
Company irrevocably authorize the Trustee to issue a timely notice of redemption
and to take such other steps reasonably requested by the Trustee to ensure that
such redemption will be effectuated;
(b) in the case of an election under Section 12.02, the Company has
delivered to the Trustee (i) either (x) an Opinion of Counsel to the effect that
Holders will not recognize income, gain or loss for Federal income tax purposes
as a result of the exercise by the Company of its option under this Article 12
and will be subject to Federal income tax on the same amount and in the same
manner and at the same times as would have been the case if such deposit,
defeasance and discharge had not occurred, which Opinion of Counsel must be
based upon (and accompanied by a copy of) a ruling of the Internal Revenue
Service to the same effect unless there has been a change in applicable Federal
income tax law after the date of this Indenture such that a ruling is no longer
required or (y) a ruling directed to the Trustee received from the Internal
Revenue Service to the same effect as the aforementioned Opinion of Counsel and
(ii) an Opinion of Counsel to the effect that, as a result of the creation of
the defeasance trust, the Company will not be required to register under the
Investment Company Act of 1940 and after the passage of 123 days following the
deposit, the trust fund will not be subject to the effect of Section 547 of the
United States Bankruptcy Code or Section 15 of the New York Debtor and Creditor
Law or any comparable provision of applicable law;
(c) in the case of an election under Section 12.03, the delivery by the
Company to the Trustee of (i) an Opinion of Counsel to the effect that, among
other things, the Holders will not recognize income, gain or loss for Federal
income tax purposes as a result of such deposit and defeasance and will be
subject to Federal income tax on the same amount and in the same manner and at
the same times as would have been the case if such deposit and defeasance had
not occurred and (ii) an Opinion of Counsel to the effect that, as a result of
the creation of the defeasance trust, the Company will not be required to
register under the Investment Company Act of 1940 and after the passage of 123
days following the deposit, the trust fund will not be subject to the effect of
Section 547 of the United States Bankruptcy Code or Section 15 of the New York
Debtor and Creditor Law or any comparable provision of applicable law;
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(d) immediately after giving effect to such deposit on a pro forma basis,
no Event of Default, or event that after the giving of notice or lapse of time
or both would become an Event of Default, shall have occurred and be continuing
on the date of such deposit or during the period ending on the 123rd day after
the date of such deposit, and such deposit shall not result in a breach or
violation of, or constitute a default under, any other agreement or instrument
to which the Company is a party or by which the Company is bound;
(e) if at such time the Notes are listed on a national securities
exchange, the Company has delivered to the Trustee an Opinion of Counsel to the
effect that the Notes will not be delisted as a result of such deposit,
defeasance and discharge;
(f) the Company shall have delivered to the Trustee Officer's Certificates
stating that the deposit made by the Company pursuant to its election under
Sections 12.02 or 12.03 was not made by the Company with the intent of
preferring the Holders over the other creditors of the Company with the intent
of defeating, hindering, delaying or defrauding creditors of the Company or
others; and
(g) the Company shall have delivered to the Trustee Officer's Certificates
and an Opinion of Counsel, each stating that all conditions precedent provided
for relating to either the Legal Defeasance under Section 12.02 or the Covenant
Defeasance under Section 12.03 (as the case may be) have been complied with as
contemplated by this Section 12.04.
Section 12.05. Deposited Money and Government Securities to Be Held in
Trust; Other Miscellaneous Provisions. Subject to Section 12.06, all money and
U.S. Government Obligations (including the proceeds thereof) deposited with the
Trustee pursuant to Section 12.04 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 (including the Company acting as 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 of, premium, if any, and interest and Liquidated
Damages, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the money or U.S. Government
Obligations deposited pursuant to Section 12.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the Outstanding Notes.
Anything in this Article 12 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or U.S. Government Obligations held by it as provided in
Section 12.04 hereof which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section
12.04(a) hereof), are in excess of the amount thereof
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which would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.
Section 12.06. Repayment to Company. Any money deposited with the Trustee
or any Paying Agent, or then held by the Company, in trust for the payment of
the principal of, premium, if any, or interest and Liquidated Damages on any
Note and remaining unclaimed for two years after such principal, premium, if
any, or interest and Liquidated Damages has become due and payable shall be paid
to the Company on its written request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense of the Company cause
to be published once, in The New York Times and The Wall Street Journal
(national edition), notice that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such notification or publication, any unclaimed balance of such money then
remaining will be repaid to the Company.
Section 12.07. Reinstatement. If the Trustee or Paying Agent is unable to
apply any money or U.S. Government Obligations in accordance with Section 12.02
or 12.03, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the obligations of the Company under this Indenture and the
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 12.02 or 12.03 until such time as the Trustee or Paying Agent is
permitted to apply all such amounts in accordance with Section 12.02 or 12.03
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or interest and Liquidated Damages on
any Note following the reinstatement of its Obligations, the Company shall be
subrogated to the rights of the Holder of such Note to receive such payment from
the amounts held by the Trustee or Paying Agent.
ARTICLE 13
Subsidiary Guarantees
Section 13.01. The Guarantees. (a) Subject to the provisions of this
Article 13, each Subsidiary Guarantor hereby irrevocably and unconditionally
guarantees, jointly and severally, the full and punctual payment (whether at
Stated Maturity, upon acceleration, optional redemption, upon repurchase
following a Change of Control Offer or an Asset Sale Offer or otherwise) of the
principal of and premium, if any, and interest and Liquidated Damages, if any,
on, and all other amounts payable under, each Note provided for under this
Indenture, and the full and punctual payment of all other amounts payable by the
Company under this Indenture. Upon failure by the Company to pay punctually any
such amount, each Subsidiary Guarantor shall forthwith on demand pay the amount
not so paid at the place and in the manner specified in this Indenture.
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Section 13.02. Guarantee Unconditional. The obligations of the Subsidiary
Guarantors hereunder shall be unconditional and absolute and, without limiting
the generality of the foregoing, shall, to the fullest extent permitted by law,
not be released, discharged or otherwise affected by:
(a) any extension, renewal, settlement, compromise, waiver or release in
respect of any obligation of the Company under this Indenture or any Note, by
operation of law or otherwise;
(b) any modification or amendment of or supplement to this Indenture or
any Note; provided that any such modification which increases the obligations of
each Subsidiary Guarantor hereunder shall not be effective as to such Subsidiary
Guarantor without its consent;
(c) any release, impairment, non-perfection or invalidity of any direct or
indirect security for any obligation of the Company or any Subsidiary Guarantor
hereunder;
(d) any change in the corporate existence, structure or ownership of the
Company, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting the Company or its assets or any resulting release or
discharge of any obligation of the Company contained in this Indenture or any
Note;
(e) the existence of any claim, set-off or other rights which the
Subsidiary Guarantors may have at any time against the Company, the Trustee or
any other Person, whether in connection with this Indenture or any unrelated
transactions, provided that nothing herein shall prevent the assertion of any
such claim by separate suit or compulsory counterclaim;
(f) any invalidity or unenforceability relating to or against the Company
for any reason of this Indenture or any Note, or any provision of applicable law
or regulation purporting to prohibit the payment by the Company of the principal
of or interest and Liquidated Damages on any Note or any other amount payable by
the Company under this Indenture; or
(g) any other act or omission to act or delay of any kind by the Company,
the Trustee or any other Person or any other circumstance whatsoever which
might, but for the provisions of this paragraph, constitute a legal or equitable
discharge of or defense to such Subsidiary Guarantor's obligations hereunder.
Section 13.03. Discharge; Reinstatement. The Subsidiary Guarantors'
obligations hereunder shall remain in full force and effect until the principal
of, premium, if any, and interest and Liquidated Damages, if any, on the Notes
and all other amounts payable by the Company under this Indenture shall have
been paid in full. If at any time any payment of the principal of, premium, if
any, or interest and Liquidated Damages, if any, on any Note or any other amount
payable by the Company under this Indenture is rescinded or must be otherwise
restored or returned upon the insolvency, bankruptcy or reorganization of the
Company or otherwise, the Subsidiary Guarantors'
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obligations hereunder with respect to such payment shall be reinstated as though
such payment had been due but not made at such time.
Section 13.04. Waiver by the Subsidiary Guarantors. The Subsidiary
Guarantors irrevocably waive acceptance hereof, presentment, demand, protest and
any notice not provided for herein, as well as any requirement that at any time
any action be taken by any Person against the Company or any other Person.
Section 13.05. Subrogation and Contribution. Upon making any payment with
respect to any obligation of the Company under this Article 13, the Subsidiary
Guarantor making such payment shall be subrogated to the rights of the payee
against the Company with respect to such obligation; provided that such
Subsidiary Guarantor shall not enforce either (i) any right to receive payment
by way of subrogation against the Company or against any direct or indirect
security for such obligation, or any other right to be reimbursed, indemnified
or exonerated by or for the account of the Company in respect thereof or (ii)
any right to receive payment, in the nature of contribution or for any other
reason, from any other Subsidiary Guarantor with respect to such payment, in
each case so long as any amount payable by the Company hereunder or under the
Notes remains unpaid.
Section 13.06. Stay of Acceleration. If acceleration of the time for
payment of any amount payable by the Company under this Indenture or the Notes
is stayed upon the insolvency, bankruptcy or reorganization of the Company, all
such amounts otherwise subject to acceleration under the terms of this Indenture
shall nonetheless be payable by the Subsidiary Guarantors hereunder forthwith on
demand by the Trustee or the Holders.
Section 13.07. Limits of Guarantees. Notwithstanding anything to the
contrary in this Article 13, each Subsidiary Guarantor, and by its acceptance of
Notes, each Holder, hereby confirms that it is the intention of all such parties
that the Subsidiary Guarantee of such Guarantor not constitute a fraudulent
conveyance under applicable fraudulent conveyance provisions of the United
States Bankruptcy Code or any comparable provision of state law. To effectuate
the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors
hereby irrevocably agree that the obligations of such Subsidiary Guarantor under
its Subsidiary Guarantee and this Article 13 shall be limited to the maximum
amount that would not render such Subsidiary Guarantor's obligations subject to
avoidance under applicable fraudulent conveyance provisions of the United States
Bankruptcy Code or any comparable provision of state law.
Section 13.08. Execution and Delivery of Note Guarantee. To evidence its
Subsidiary Guarantee set forth in Section 13.01, each Subsidiary Guarantor
hereby agrees that this Indenture (or a supplemental indenture in the form of
Exhibit B hereto) shall be executed on behalf of such Subsidiary Guarantor by
one of its Officers.
The signature of an Officer of a Subsidiary Guarantor on the Indenture
shall bind such Subsidiary Guarantor, notwithstanding that such individual has
ceased to hold such office prior to the authentication and delivery of any Note
or did not hold such office at the date of such Note.
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The delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Subsidiary Guarantee set forth
in this Indenture on behalf of the Subsidiary Guarantors.
ARTICLE 14
Security Arrangements
Section 14.01. Security. (a) In order to secure the Indenture Obligations
equally and ratably with the Existing Credit Facility Obligations and
Obligations in respect of the Existing Senior Secured Notes and, with respect to
certain of the Collateral, the Existing ARCO Chemical Debt, the Company will,
and will cause each of its Restricted Subsidiaries named in any Existing
Security Document as a party thereto, to execute and deliver to the Collateral
Agent prior to the Issue Date each Existing Security Document to which it is a
party. The Company and its Restricted Subsidiaries shall comply with all
covenants and agreements contained in the Security Documents the failure to
comply with which would have a material and adverse effect on the Liens
purported to be created thereby, unless such failure to comply is waived by the
requisite lenders under the Existing Credit Facility if, after that waiver, the
Company is in compliance with Section 4.12.
(b) The Trustee and each holder of each Note by its acceptance of that
Note acknowledges and agrees that:
(i) this Indenture, as originally executed and delivered by the
parties hereto, does not create any Lien on any property or securities
which secures the Indenture Obligations or this Indenture;
(ii) the Existing Security Documents, when executed and delivered
by the parties thereto, will comply with the provisions of Section 4.12;
(iii) the Existing Security Documents provide, and any Security
Document that becomes effective after the Issue Date, may provide, that the
Liens created thereby or thereunder automatically will be released and
extinguished with respect to any property or security that is transferred
or otherwise disposed of in accordance with the terms of the Existing
Credit Facility, including any property or security that is the subject of
a Major Asset Sale and is transferred to a Subject Asset Transferee;
(iv) without the necessity of any consent of or notice to the
Trustee or any holder of Indenture Obligations, the Company and the
Collateral Agent may amend, modify, supplement or terminate any Security
Document as long as the Company remains in compliance with Section 4.12;
(v) as among the Trustee and the holders of Indenture
Obligations and the lenders under the Existing Credit Facility and the
Collateral Agent, those lenders and the Collateral Agent will have the sole
ability to control and obtain
107
remedies with respect to all Collateral (including on sale or liquidation
of any Collateral after acceleration of the Notes, the Existing Senior
Secured Notes, the Existing Credit Facility Obligations or the Existing
ARCO Chemical Debt) without the necessity of any consent of or notice to
the Trustee or any such holder;
(vi) any or all Liens granted under the Security Documents for
the benefit of the Holders will be automatically released, without the
necessity of any consent of the Trustee or any Holders, upon a release of
such Lien or Liens pursuant to the terms of the Security Documents and the
Existing Credit Facility or if such release is approved by the requisite
lenders under the Existing Credit Facility.
(vii) the relative rights of the holders of Indenture Obligations
and the holders of Indebtedness or other obligations secured by Liens on
the Collateral are governed by, and are subject to the terms and conditions
of, the Security Documents and not this Indenture; and
(viii) without the necessity of any consent of or notice to the
Trustee or any holder of Indenture Obligations, the Company may, on behalf
of itself or any of its Restricted Subsidiaries, request and instruct the
Collateral Agent to, on behalf of each secured party under the Security
Documents, (A) execute and deliver to the Company, for the benefit of any
Person, such release documents as the Company may reasonably request, of
all liens and security interests held by the Collateral Agent in such
assets, and such Person shall be entitled to rely conclusively on such
release document, and (B) deliver any such assets in the possession of the
Collateral Agent to the Company.
Section 14.02. Notice of Payment, Discharge or Defeasance. The Trustee and
each Holder, by its acceptance of a Note, agree that upon the payment in full or
discharge pursuant to Article 11 of the Indenture Obligations, the Trustee shall
without notice to or consent of any Holder, upon the written request of the
Company, certify to the Collateral Agent, in writing, that the Indenture
Obligations have been paid in full, or that this Indenture has been discharged
in accordance with Article 11.
108
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
LYONDELL CHEMICAL COMPANY
By: /s/ Karen A. Twitchell
----------------------------------
Name: Karen A. Twitchell
Title: Vice President & Treasurer
ARCO CHEMICAL TECHNOLOGY, INC., as
a Subsidiary Guarantor
By: __________________________________
Name:
Title:
ARCO CHEMICAL TECHNOLOGY, L.P., as a
Subsidiary Guarantor
By: ARCO Chemical Technology
Management, Inc., its General
Partner
By: __________________________________
Name:
Title:
LYONDELL CHEMICAL NEDERLAND, LTD.,
as a Subsidiary Guarantor
By: /s/ Karen A. Twitchell
----------------------------------
Name: Karen A. Twitchell
Title: Vice President & Treasurer
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
LYONDELL CHEMICAL COMPANY
By: __________________________________
Name:
Title:
ARCO CHEMICAL TECHNOLOGY, INC., as
a Subsidiary Guarantor
By: /s/ Francis P. McGrail
----------------------------------
Name: Francis P. McGrail
Title: President and Treasurer
ARCO CHEMICAL TECHNOLOGY, L.P., as a
Subsidiary Guarantor
By: ARCO Chemical Technology
Management, Inc., its General
Partner
By: /s/ Francis P. McGrail
----------------------------------
Name: Francis P. McGrail
Title: President and Treasurer
LYONDELL CHEMICAL NEDERLAND, LTD.,
as a Subsidiary Guarantor
By: __________________________________
Name:
Title:
THE BANK OF NEW YORK,
as Trustee
By: /s/ Van K. Brown
----------------------------------
Name: VAN K. BROWN
Title: VICE PRESIDENT
EXHIBIT A
[FORM OF NOTE]
LYONDELL CHEMICAL COMPANY.
9 1/2% Senior Secured Note due 2008
No.________ [CUSIP/CINS] No. __________
$ ______
LYONDELL CHEMICAL COMPANY, a Delaware corporation (the "Company", which
term includes any successor Persons under the Indenture hereinafter referred
to), for value received promises to pay to ___________, or its registered
assigns, the principal sum of __________________________________ Dollars
($___________) [or such other amount as indicated on the Schedule of Exchanges
of Securities attached hereto]/1/, on December 15, 2008.
Interest Rate: 9 1/2% per annum.
Interest Payment Dates: June 15 and December 15 of each year
commencing June 15, 2002.
Regular Record Dates: June 1 and December 1 of each year.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
_______________
/1/ To be included in any Global Note
A-1
IN WITNESS WHEREOF, the Company has caused this Note to be signed
manually or by facsimile by its duly authorized officer.
LYONDELL CHEMICAL COMPANY
By:_____________________________
Name:
Title:
A-2
(Form of Trustee's Certificate of Authentication)
This is one of the 9 1/2% Senior Secured Notes due 2008 referred to in
the within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
Dated: ______________ By:_________________________
Authorized Signatory
A-3
[REVERSE SIDE OF NOTE]
LYONDELL CHEMICAL COMPANY
9 1/2% Senior Secured Note due 2008
(1) Principal and Interest. The Company agrees to pay the principal of
this Note on December 15, 2008.
The Company agrees to pay interest on the principal amount of this Note
on each Interest Payment Date, as set forth below, at the rate of 9 1/2% per
annum.
Interest will be payable semi-annually (to the Holders of record of the
Notes (or any predecessor Notes) at the close of business on the Regular Record
Date immediately preceding the Interest Payment Date) on each Interest Payment
Date, commencing June 15, 2002.
[The Holder of this Note is entitled to the benefits of the
Registration Rights Agreement, dated December 4, 2001, among the Company, the
Subsidiary Guarantors party thereto and the Initial Purchasers named therein
(the "Registration Rights Agreement"). In the event that (i) the Company or the
Subsidiary Guarantors fail to file an Exchange Offer Registration Statement with
the SEC on or prior to the 90th day after the Issue Date, (ii) if the Exchange
Offer Registration Statement is not declared effective by the SEC on or prior to
the 210th day after the Issue Date, (iii) if the Exchange Offer is not
consummated on or before the 30th business day after the Exchange Offer
Registration Statement is declared effective, (iv) the Company and the
Subsidiary Guarantors are obligated to file the Shelf Registration Statement and
fail to file the Shelf Registration Statement with the SEC on or prior to the
30th day after such filing obligation arises, (v) the Company and the Subsidiary
Guarantors are obligated to file a Shelf Registration Statement and the Shelf
Registration Statement is not declared effective on or prior to the 60th day
after the obligation to file a Shelf Registration Statement arises, or (vi) if
the Exchange Offer Registration Statement or the Shelf Registration Statement,
as the case may be, is declared effective but thereafter ceases to be effective
or useable in connection with resales of the Notes during the periods specified
in the Registration Rights Agreement, for such time of non-effectiveness or
non-usability (each, a "Registration Default"), the Company and the Subsidiary
Guarantors agree to pay to the Holder of this Note, if affected thereby,
liquidated damages ("Liquidated Damages") in an amount equal to $0.05 per week
per $1,000 in principal amount of this Note for each week or portion thereof
that the Registration Default continues for the first 90 day period immediately
following the occurrence of such Registration Default. The amount of the
Liquidated Damages shall increase by an additional $0.05 per week per $1,000 in
principal amount of Notes with respect to each subsequent 90 day period until
all Registration Defaults have been cured, up to a maximum amount of Liquidated
Damages of $0.25 per week per $1,000 in principal amount of Notes. The Company
and the Subsidiary Guarantors shall not be required to pay Liquidated Damages
for more than one Registration Default at any given time.
A-4
Following the cure of all Registration Defaults, the accrual of Liquidated
Damages will cease.]/2/
Interest on this Note will accrue from the most recent date to which
interest has been paid [on this Note or the Note surrendered in exchange
herefor]/3/ or, if no interest has been paid, from December 4, 2001; provided
that, if there is no existing default in the payment of interest and if this
Note is authenticated between a Regular Record Date referred to on the face
hereof and the next succeeding Interest Payment Date, interest shall accrue from
such Interest Payment Date. 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 premium, if
any, and interest on overdue installments of interest and Liquidated Damages, to
the extent lawful, at a rate per annum equal to 1% per annum in excess of the
rate of interest applicable to the Notes.
(2) Method of Payment. The Company will pay interest (except defaulted
interest) on the principal amount of the Notes on each June 15 and December 15
to the Persons who are Holders (as reflected in the Register at the close of
business on the June 1 and December 1 immediately preceding the Interest Payment
Date), in each case, even if the Note is canceled on registration of transfer or
registration of exchange after such Regular Record Date; provided that, with
respect to the payment of principal, the Company will make payment to the Holder
that surrenders this Note to any Paying Agent on or after December 15, 2008.
The Company will pay principal, premium, if any, and interest and
Liquidated Damages, if any, in money of the United States that at the time of
payment is legal tender for payment of public and private debts. Payments
(including principal, premium, if any, and interest and Liquidated Damages, if
any) in respect of the Notes represented by the Global Notes, the Holders of
which have given wire transfer instructions on or prior to the relevant record
date, shall be made by wire transfer of immediately available funds to the
accounts specified by the Global Note Holder. With respect to Physical Notes,
the Company will make all payments of principal, premium, if any, and interest
and Liquidated Damages, if any, at the office or agency maintained by the
Company for such purposes in The City of New York or, at the Company's option,
by mailing a check to each such Holder's registered address. If a payment date
is a date other than a Business Day, payment may be made at that place on the
next succeeding day that is a Business Day and no interest shall accrue for the
intervening period.
(3) Paying Agent and Registrar. Initially, the Trustee will act as
Paying Agent and Registrar. The Company may change any Paying Agent or Registrar
upon written notice thereto. The Company, any Subsidiary or any Affiliate of any
of them may act as Paying Agent, Registrar or co-registrar.
________________________
/2/ Include only for Initial Note.
/3/ Include only for Exchange Note.
A-5
(4) Indenture; Limitations. The Company issued the Notes under an
Indenture dated as of December 4, 2001 (the "Indenture"), among the Company, the
Subsidiary Guarantors and The Bank of New York, as trustee (the "Trustee").
Capitalized terms herein are used as defined in the Indenture unless otherwise
indicated. 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
(the "TIA"). The Notes are subject to all such terms, and Holders are referred
to the Indenture and the TIA for a statement of all such terms. To the extent
permitted by applicable law, in the event of any inconsistency between the terms
of this Note and the terms of the Indenture, the terms of the Indenture shall
control.
The Notes are secured senior obligations of the Company. The Indenture
limits the initial aggregate principal amount of the Notes to $393,000,000 but
permits the issuance of Additional Notes subject to compliance with certain
conditions and covenants contained in the Indenture and except as may be limited
by applicable law.
(5) Optional Redemption. The Notes may be redeemed at the option of the
Company, in whole or in part, at any time and from time to time, on or after
December 1, 2005, at the following Redemption Prices (expressed in percentages
of principal amount on the relevant Redemption Date), plus accrued and unpaid
interest and Liquidated Damages, if any, to the Redemption Date, if redeemed
during the 12-month period commencing December 15 of each of the years set forth
below:
Year Redemption Price
2005................................. 104.750%
2006................................. 102.375%
2007 and thereafter.................. 100.000%
If less than all the Notes are to be redeemed at any time, selection of
Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange, if any, on which the
Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot
or by such method as the Trustee shall deem fair and appropriate; provided that
no Notes of $1,000 or less shall be redeemed in part.
Notices of redemption shall be mailed by first class mail at least 30
but not more than 60 days before the redemption date to each Holder of Notes to
be redeemed at its registered address. Notices of redemption may not be
conditional. 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. A new Note in principal amount equal to the
unredeemed portion thereof will be issued in the name of the Holder thereof upon
cancellation of the original Note. Notes called for redemption become due on the
date fixed for redemption. On and after the redemption date, interest and
Liquidated Damages, if any, cease to accrue on Notes or portions of them called
for redemption.
A-6
(6) Repurchase upon a Change in Control and Sale of Assets. Upon the
occurrence of (a) a Change in Control, each Holder shall have the right to
require that the Company repurchase such Holder's Notes at a purchase price in
cash equal to 101% of the principal amount thereof on the date of purchase, plus
accrued and unpaid interest and Liquidated Damages, if any, to the date of
purchase and (b) an Asset Sale, the Company may be obligated to make an offer to
purchase on a pro rata basis from the Holders the Notes with the Excess Proceeds
of such Asset Sales at a purchase price equal to 100% of the principal amount of
such Notes plus accrued interest and Liquidated Damages, if any, to the date of
purchase.
(7) Denominations; Transfer; Exchange. The Notes are in fully
registered form without coupons, in denominations of $1,000 and any integral
multiples of $1,000. A Holder may 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
any taxes and fees required by law or permitted by the Indenture.
(8) Persons Deemed Owners. A Holder may be treated as the owner of a
Note for all purposes.
(9) Unclaimed Money. If money for the payment of principal, premium,
if any, or interest and Liquidated Damages, if any, remains unclaimed for two
years, the Trustee and the Paying Agent will pay the money back to the Company
at its written request. After that, Holders entitled to the money must look to
the Company for payment, unless an abandoned property law designates another
Person, and all liability of the Trustee and such Paying Agent with respect to
such money shall cease.
(10) Discharge Prior to Redemption or Maturity. If the Company
irrevocably deposits, or causes to be deposited, with the Trustee money or U.S.
Government Obligations sufficient to pay the then outstanding principal of and
premium, if any, and accrued interest and Liquidated Damages on the Notes (a) to
redemption or maturity, the Company will be discharged from the Indenture and
the Notes, except in certain circumstances for certain sections thereof, and (b)
to redemption or maturity, the Company will be discharged from certain covenants
set forth in the Indenture.
(11) Amendment; Supplement; Waiver. Subject to certain exceptions, the
Indenture or the Notes may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount of the Notes then
Outstanding, and any existing Default or compliance with any provision may be
waived with the consent of the Holders of a majority in aggregate principal
amount of the Notes then Outstanding. Without notice to or the consent of any
Holder, the parties thereto may amend the Indenture or the Notes to the extent
set forth in the Indenture.
(12) Restrictive Covenants. The Indenture contains certain covenants,
including, without limitation, covenants with respect to the following matters:
(i) Indebtedness; (ii) Restricted Payments; (iii) distributions from Restricted
Subsidiaries and Joint Ventures; (iv) sales of assets; (v) transactions with
Affiliates; (vi) Liens; (vii) no amendment to subordination provisions; (viii)
repurchase of Notes upon a Change in
A-7
Control; (ix) Sale and Leaseback Transactions; (x) Subsidiary Guarantees; and
(xi) consolidation, merger and sale of assets. Within 120 days after the end of
each fiscal year, the Company must report to the Trustee on compliance with such
limitations.
(13) Successor Persons. When a successor person or other entity (other
than a Subsidiary of the Company) assumes all the obligations of its predecessor
under the Notes and the Indenture, the predecessor person will be released from
those obligations.
(14) Remedies for Events of Default. If an Event of Default (other than
an Event of Default specified in Section 6.01(g) or (h) of the Indenture that
occurs with respect to the Company or a Subsidiary Guarantor) occurs and is
continuing under this Indenture, then in every such case the Trustee or the
Holders of at least 25% in aggregate principal amount of the Outstanding Notes,
by written notice to the Company (and to the Trustee if such notice is given by
the Holders), may, and the Trustee at the written request of such Holders shall,
declare the principal of, premium, if any, and accrued interest and Liquidated
Damages, if any, on all of the Outstanding Notes to be immediately due and
payable. Upon a declaration of acceleration, such principal of, premium, if any,
and accrued interest and Liquidated Damages, if any, shall be immediately due
and payable. If an Event of Default specified in Section 6.01(g) or (h) of the
Indenture occurs with respect to the Company or a Subsidiary Guarantor, the
principal of, premium, if any, and accrued interest and Liquidated Damages, if
any, on the Outstanding Notes shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holder. The Holders of at least a majority in aggregate principal amount of the
Outstanding Notes by written notice to the Company and to the Trustee, may waive
all past defaults and rescind and annul a declaration of acceleration and its
consequences if (1) all existing Events of Default, other than the nonpayment of
the principal of, premium, if any, and interest and Liquidated Damages, if any,
on the Notes that have become due solely by such declaration of acceleration,
have been cured or waived and (2) the recission would not conflict with any
judgment or decree of a court of competent jurisdiction.
Holders may not enforce the Indenture, the Notes or the Subsidiary
Guarantees except as provided in the Indenture. The Trustee may require security
or indemnity satisfactory to it before it enforces the Indenture, the Notes or
the Subsidiary Guarantees. The Holders of at least a majority in aggregate
principal amount of the Notes then Outstanding may direct the Trustee in the
exercise of any trust or power in accordance with the terms of the Indenture.
(15) Security. In order to secure the Indenture Obligations, the
Company and certain of its Restricted Subsidiaries have entered into the
Security Documents. The Indenture Obligations shall be secured by Liens on the
Collateral in accordance with the terms and provisions of the Security
Documents. The Indenture requires that Holders of the Notes be granted a lien
equally and ratably with any lien granted on additional assets to secure the
holders of Existing Credit Facility Obligations subsequent to the Issue Date.
Each Holder of this Note, by accepting the same, agrees that (i) the Existing
Security Documents provide, and any Security Document that becomes effective
after the Issue Date, may provide, that the Liens created thereby or thereunder
automatically will be released and extinguished with respect to any property or
security that is transferred or
A-8
otherwise disposed of in accordance with the terms of the Existing Credit
Facility, including any property or security that is the subject of a Major
Asset Sale and is transferred to a Subject Asset Transferee; (ii) without the
necessity of any consent of or notice to the Trustee or any holder of Indenture
Obligations, the Company and the Collateral Agent may amend, modify, supplement
or terminate any Security Document as long as the Company remains in compliance
with the Indenture; (iii) as among the Trustee and the holders of Indenture
Obligations and the lenders under the Existing Credit Facility and the
Collateral Agent, those lenders and the Collateral Agent will have the sole
ability to control and obtain remedies with respect to all Collateral (including
on sale or liquidation of any Collateral after acceleration of the Notes, the
Existing Senior Secured Notes, the Existing Credit Facility Obligations or the
Existing ARCO Chemical Debt) without the necessity of any consent of or notice
to the Trustee or any such holder; (iv) any or all Liens granted under the
Security Documents for the benefit of the Holders will be automatically
released, without the necessity of any consent of the Trustee or the Holders,
upon a release of such Lien or Liens pursuant to the terms of the Security
Documents and the Existing Credit Facility or if such release is approved by the
requisite lenders under the Existing Credit Facility; (v) the relative rights of
the holders of Indenture Obligations and the holders of Indebtedness or other
obligations secured by Liens on the Collateral are governed by, and are subject
to the terms and conditions of, the Security Documents and not this Indenture;
and (vi) without the necessity of any consent of or notice to the Trustee or any
holder of Indenture Obligations, the Company may, on behalf of itself or any of
its Restricted Subsidiaries, request and instruct the Collateral Agent to, on
behalf of each secured party under the Security Documents, (A) execute and
deliver to the Company, for the benefit of any Person, such release documents as
the Company may reasonably request, of all liens and security interests held by
the Collateral Agent in such assets, and such Person shall be entitled to rely
conclusively on such release document, and (B) deliver any such assets in the
possession of the Collateral Agent to the Company. From and after the date when
all liens granted in favor of the holders of Existing Credit Facility
Obligations are released, the provisions regarding security described above will
no longer apply.
(16) Subsidiary Guarantees. Each Subsidiary Guarantor irrevocably and
unconditionally guarantees, jointly and severally, on a senior basis, the full
and punctual payment (whether at Stated Maturity, upon acceleration, optional
redemption, upon repurchase following a Change of Control Offer or an Asset Sale
Offer or otherwise) of the principal of, premium, if any, and interest and
Liquidated Damages, if any, on, and all other amounts payable under, this Note
provided for under this Indenture, and the full and punctual payment of all
other amounts payable by the Company under the Indenture; provided that,
notwithstanding anything to the contrary herein, the aggregate amount of the
Obligations guaranteed under the Indenture by any Subsidiary Guarantor shall be
limited in amount to the maximum amount that would not render such Subsidiary
Guarantor's obligations subject to avoidance under the applicable fraudulent
conveyance provisions of the United States Bankruptcy Code or any comparable
provision of any applicable state law.
(17) Additional Subsidiary Guarantees. If any of the Company's Restricted
Subsidiaries shall Guarantee or secure the payment of any other Indebtedness of
the Company or any of its Restricted Subsidiaries, then, subject to certain
exceptions
A-9
specified in the Indenture, such Restricted Subsidiary shall become a Subsidiary
Guarantor by executing a supplemental indenture.
(18) Trustee Dealings with Company. The Trustee under the Indenture, 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, and otherwise
deal with, the Company and its Affiliates as if it were not the Trustee.
(19) Authentication. This Note shall not be valid until the Trustee signs
the certificate of authentication on this Note.
(20) Abbreviations. Customary abbreviations may be used in the name of a
Holder 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).
(21) Governing Law. This Note shall be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to any principles of conflict of laws to the extent that the application
of the law of another jurisdiction is required thereby.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to the Company, One Houston
Center, Suite 700, 1221 McKinney, Houston, Texas 77010; Attention: General
Counsel.
A-10
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
__________________________________________________________________________
(Please print or typewrite name and address including zip code of assignee)
__________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing
__________________________________________________________________________
attorney to transfer such Note on the books of the Company with full power of
substitution in the premises.
A-11
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL CERTIFICATES BEARING A PRIVATE PLACEMENT LEGEND]
In connection with any transfer of this Note occurring prior to December 4,
2003, the undersigned confirms that without utilizing any general solicitation
or general advertising that:
Check One
(a) this Note is being transferred in compliance with the exemption from
registration under the Securities Act of 1933, as amended, provided by Rule 144A
thereunder and the certificate attached hereto has been completed. [_]
(b) this Note is being transferred in compliance with Regulation S under
the Securities Act and a certificate in the form specified by the Indenture is
being furnished herewith. [_]
(c) this Note is being transferred in compliance with the exemption from
registration under the Securities Act of 1933, as amended, provided by Rule 144
thereunder. [_]
(d) this Note is being transferred to the Company. [_]
or
(e) this Note is being transferred other than in accordance with (a), (b)
or (d) above, and documents are being furnished which comply with the conditions
of transfer set forth in this Note and the Indenture. [_]
If none of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Note in the name of any Person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Sections 3.13 and 3.14 of the Indenture
shall have been satisfied.
Date:_________________
_________________________
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
Signature Guarantee: _______________________________
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such
A-12
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act of 1933, as amended,
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:_____________________
_______________________________________
To be executed by an executive officer
A-13
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to Section
4.09 or Section 4.14 of the Indenture, check the box: [_]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.09 or Section 4.14 of the Indenture, state the amount (in
original principal amount) below:
$_____________________.
Date:____________
Your Signature:__________________________
(Sign exactly as your name appears on the other side of this Note)
Signature Guarantee:_____________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-14
SCHEDULE OF EXCHANGES OF SECURITIES
The following exchanges of a part of this Global Note for Physical Notes or a
part of another Global Note have been made:
Principal amount of this
Amount of decrease Amount of increase in Global Note following Signature of
in principal amount principal amount of this such decrease (or authorized officer of
Date of Exchange of this Global Note Global Note increase) Trustee
A-15
EXHIBIT B
SUPPLEMENTAL INDENTURE
dated as of __________, ____
among
LYONDELL CHEMICAL COMPANY,
as Company
[SUBSIDIARY GUARANTORS]
and
THE BANK OF NEW YORK,
as Trustee
________________
9 1/2% Senior Secured Notes due 2008
THIS SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), entered
into as of __________, ____, among LYONDELL CHEMICAL COMPANY., a Delaware
corporation (the "Company") [INSERT EACH SUBSIDIARY GUARANTOR EXECUTING THIS
SUPPLEMENTAL INDENTURE AND ITS JURISDICTION OF INCORPORATION] (each an
"Undersigned") and THE BANK OF NEW YORK, as trustee (the "Trustee").
RECITALS
WHEREAS, the Company, the Subsidiary Guarantors party thereto and the
Trustee entered into the Indenture, dated as of December 4, 2001 (the
"Indenture"), relating to the Company's 9 1/2% Senior Secured Notes due 2008
(the "Notes");
WHEREAS, as a condition to the Trustee entering into the Indenture and the
purchase of the Notes by the Holders, the Company agreed, subject to certain
exceptions, pursuant to Section 4.22 of the Indenture to cause any Restricted
Subsidiary that has guaranteed or secured Indebtedness of the Company or any of
its Restricted Subsidiaries to provide Subsidiary Guarantees.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and intending to be legally bound, the parties hereto hereby
agree as follows:
Section 1. Capitalized terms used herein and not otherwise defined herein
are used as defined in the Indenture.
Section 2. Each Undersigned, by its execution of this Supplemental
Indenture, agrees to be a Subsidiary Guarantor under the Indenture and to be
bound by the terms of the Indenture applicable to Subsidiary Guarantors,
including, but not limited to, Article 13 thereof.
Section 3. This Supplemental Indenture shall be governed by and construed
in accordance with the internal laws of the State of New York.
Section 4. This Supplemental Indenture may be signed in various
counterparts which together shall constitute one and the same instrument.
Section 5. This Supplemental Indenture is an amendment supplemental to the
Indenture and said Indenture and this Supplemental Indenture shall henceforth be
read together.
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Supplemental Indenture or have caused this Supplemental Indenture to be duly
executed on their respective behalf by their respective officers thereunto duly
authorized, as of the day and year first above written.
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LYONDELL CHEMICAL COMPANY
By:___________________________
Name:
Title:
[SUBSIDIARY GUARANTORS]
THE BANK OF NEW YORK,
as Trustee
By:___________________________
Name:
Title:
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EXHIBIT C
Form of Certificate of Beneficial Ownership
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
Re: Lyondell Chemical Company
9 1/2% Senior Secured Notes due 2008 (the "Notes")
Issued under the Indenture (the "Indenture") dated as
of December 4, 2001 relating to the Notes
-----------------------------------------------------
This is to certify that based solely on certifications we have received in
writing, by tested telex or by electronic transmission from member organizations
("Member Organizations") appearing in our records as persons being entitled to a
portion of the principal amount of Notes represented by Temporary Offshore
Global Note issued under the above-referenced Indenture, that as of the date
hereof, $____ principal amount of Notes represented by the Temporary Offshore
Global Note being submitted herewith for exchange is beneficially owned by
persons who are either (i) non-U.S. persons (within the meaning of Regulation S
under the Securities Act of 1933, as amended) or (ii) U.S. persons who purchased
the Notes in a transaction that did not require registration under the
Securities Act of 1933, as amended. We further certify that (i) we are not
submitting herewith for exchange any portion of such Temporary Offshore Global
Note excepted in such Member Organization certifications and (ii) as of the date
hereof we have not received any notification from any Member Organization to the
effect that the statements made by such Member Organization with respect to any
portion of such Temporary Offshore Global Note submitted herewith for exchange
are no longer true and cannot be relied upon as of the date hereof. Accordingly,
you are hereby requested to (i) exchange $______ of such beneficial interest
held by non-U.S. persons in the Temporary Offshore Global Note for an equivalent
beneficial interest in a Permanent Offshore Global Note and (ii) transfer
$________ of such beneficial interest held by U.S. persons in the Temporary
Offshore Global Note into an equivalent beneficial interest in the U.S. Global
Note.
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You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Yours faithfully,
[EUROCLEAR BANK S.A./N.V., as operator
of the Euroclear System]
OR
[CLEARSTREAM BANK, societe anonyme]
By:_______________________________
Name:
Title:
Date:____________________
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EXHIBIT D
Form of Certificate to be Delivered
in Connection with Transfers
Pursuant to Regulation S
---------------------------------------
_________, ____
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
Re: Lyondell Chemical Company
9 1/2% Senior Secured Notes due 2008 (the "Notes")
---------------------------------------------------
Dear Sirs:
In connection with our proposed sale of U.S.$________ aggregate principal
amount of the Notes, we confirm that such sale has been effected pursuant to and
in accordance with Regulation S under the Securities Act of 1933, as amended,
and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United States;
(2) at the time the buy order was originated, the transferee was outside
the United States or we and any person acting on our behalf reasonably believed
that the transferee was outside the United States;
(3) no directed selling efforts have been made by us in the United States
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 of 1933.
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You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:___________________________
Authorized Signatory
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EXHIBIT E
Form of Accredited Investor Certificate
Transferee Letter of Representation
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
Ladies and Gentlemen:
In connection with our proposed purchase of $[ ] aggregate principal
amount of the 9 1/2% Senior Secured Notes due 2008 (the "Notes") of Lyondell
Chemical Company (the "Company"), we confirm that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act of 1933, as
amended (the "Securities Act"), purchasing for our own account or for the
account of such an institutional "accredited investor" as to which we exercise
sole investment discretion, 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 Notes, and we and any account for which we are
acting are each able to bear the economic risk of our or its investment.
2. We understand and knowledge that the Notes have been registered under
the Securities Act or any other applicable securities law, and that the Notes
may not be offered or sold except as permitted in the following sentence. We
agree, on our own behalf and on behalf of any account for which we are acting,
that if we should sell any Notes within the time period referred to in Rule
144(k) of the Securities Act, we will do so only (A) to the Company, (B)
pursuant to an effective registration statement under the Securities Act or any
subsidiary thereof, (C) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (D) outside the United
States in accordance with Rule 904 of Regulation S under the Securities Act, (E)
in a principal amount of not less than $100,000 to an institutional "accredited
investor" (as defined above) that, prior to such transfer, furnishes to the
Trustee under the Indenture a signed letter containing certain representations
and agreements relating to the restrictions on transfer of the Notes (the form
of which letter can be obtained from the Trustee), (F) pursuant to the exemption
from registration provided by Rule 144 under the Securities Act (if available),
or any other exemption from the registration requirements of the securities Act
and in compliance with the terms of the Indenture (which terms require the
delivery of such opinions and certifications as the Company and the Trustee may
require), and we further agree to provide to any person purchasing any of the
Notes from us a notice advising such purchaser that resales of the Notes are
restricted as stated herein.
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3. We are acquiring the Notes for investment purposes and not with a view
to distribution thereof or with any present intention of offering or selling any
Notes, except as permitted above.
You and the Company are entitled to rely upon this letter and you are
irrevocably authorized to produce this letter or a copy hereto to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
THIS LETTER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS
PRINCIPLES THEREOF, OTHER THAN ANY MANDATING THE APPLICATION OF SUCH LAWS).
Very truly yours,
(Name of Purchaser)
By:________________________________
Name:
Title:
Date:______________________________
Upon transfer, the Notes would be registered in the name of the new
beneficial owner as follows:
By: _____________________________
Date: ____________________________
Taxpayer ID number: ______________
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