Exhibit 4(a)
INDENTURE
Dated as of May 29, 1996
Among
OWENS & MINOR, INC., as Issuer,
OWENS & MINOR MEDICAL, INC.,
NATIONAL MEDICAL SUPPLY CORPORATION,
OWENS & MINOR WEST, INC.,
KOLEY'S MEDICAL SUPPLY, INC.,
LYONS PHYSICIAN SUPPLY COMPANY,
A. KUHLMAN & CO.,
STUART MEDICAL, INC.,
as Guarantors,
and
CRESTAR BANK, as Trustee
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$150,000,000
10 7/8% Senior Subordinated Notes due 2006
CROSS-REFERENCE TABLE
Indenture
Trust Indenture Act Section Section
ss.310(a)(1)............................................... 7.10
(a)(2)............................................ 7.10
(a)(3)............................................ N.A.
(a)(4)............................................ N.A.
(a)(5)............................................ N.A.
(b)............................................... 7.08; 7.10; 13.02
(c)............................................... N.A.
ss. 311(a)................................................. 7.11
(b)............................................... 7.11
(c)............................................... N.A.
ss.312(a).................................................. 2.05
(b)............................................... 13.03
(c)............................................... 13.03
ss.313(a).................................................. 7.06
(b)(1)............................................ N.A.
(b)(2)............................................ 7.06
(c)............................................... 7.06; 13.02
(d)............................................... 7.06
ss.314(a).................................................. 4.11; 4.12; 13.02
(b)............................................... N.A.
(c)(1)............................................ 13.04
(c)(2)............................................ 13.04
(c)(3)............................................ N.A.
(d)............................................... N.A.
(e)............................................... 13.05
(f)............................................... N.A.
ss.315(a).................................................. 7.01(b)
(b)............................................... 7.05; 13.02
(c)............................................... 7.01(a)
(d)............................................... 7.01(c)
(e)............................................... 6.11
ss.316(a)(last sentence)................................... 2.09
(a)(1)(A)......................................... 6.05
(a)(1)(B)......................................... 6.04
(a)(2)............................................ N.A.
(b)............................................... 6.07
(c)............................................... 10.04
ss.317(a)(1)............................................... 6.08
(a)(2)............................................ 6.09
(b)............................................... 2.04
ss.318(a).................................................. 13.01
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N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be
deemed to be a part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions................................... 1
SECTION 1.02. Other Definitions............................. 21
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act.............................. 21
SECTION 1.04. Rules of Construction......................... 22
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating............................... 22
SECTION 2.02. Execution and Authentication.................. 23
SECTION 2.03. Registrar and Paying Agent.................... 23
SECTION 2.04. Paying Agent To Hold Money in Trust........... 24
SECTION 2.05. Securityholder Lists.......................... 24
SECTION 2.06. Transfer and Exchange......................... 25
SECTION 2.07. Replacement Securities........................ 25
SECTION 2.08. Outstanding Securities........................ 26
SECTION 2.09. Treasury Securities........................... 26
SECTION 2.10. Temporary Securities.......................... 26
SECTION 2.11. Cancellation.................................. 27
SECTION 2.12. Defaulted Interest............................ 27
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee............................ 27
SECTION 3.02. Selection of Securities To Be Redeemed........ 28
SECTION 3.03. Notice of Redemption.......................... 28
SECTION 3.04. Effect of Notice of Redemption................ 29
SECTION 3.05. Deposit of Redemption Price................... 29
SECTION 3.06. Securities Redeemed in Part................... 30
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities......................... 30
SECTION 4.02. Maintenance of Office or Agency............... 30
SECTION 4.03. Limitation on Transactions with
Affiliates and Related Persons............. 31
SECTION 4.04. Limitation on Indebtedness.................... 32
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Page
SECTION 4.05. Limitation on Certain Asset Dispositions...... 34
SECTION 4.06. Limitation on Restricted Payments............. 37
SECTION 4.07. Corporate Existence........................... 40
SECTION 4.08. Payment of Taxes and Other Claims............. 40
SECTION 4.09. Notice of Defaults............................ 41
SECTION 4.10. Maintenance of Properties..................... 41
SECTION 4.11. Compliance Certificate........................ 41
SECTION 4.12. Provision of Financial Information............ 42
SECTION 4.13. Waiver of Stay, Extension or Usury Laws....... 42
SECTION 4.14. Change of Control............................. 43
SECTION 4.15. Limitation on Senior Subordinated
Indebtedness............................... 44
SECTION 4.16. Limitations Concerning Distribu- tions
and Transfers by Sub- sidiaries............ 44
SECTION 4.17. Limitation on Issuance and Sale of Capital
Stock of Subsidiaries...................... 46
SECTION 4.18. Limitation on Liens........................... 46
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Restriction on Mergers, Consolidations and
Certain Sales of Assets.................... 48
SECTION 5.02. Successor Corporation Substituted............. 49
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default............................. 49
SECTION 6.02. Acceleration.................................. 52
SECTION 6.03. Other Remedies................................ 52
SECTION 6.04. Waiver of Past Default........................ 53
SECTION 6.05. Control by Majority........................... 53
SECTION 6.06. Limitation on Suits........................... 54
SECTION 6.07. Rights of Holders To Receive Payment.......... 55
SECTION 6.08. Collection Suit by Trustee.................... 55
SECTION 6.09. Trustee May File Proofs of Claim.............. 55
SECTION 6.10. Priorities.................................... 56
SECTION 6.11. Undertaking for Costs......................... 56
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee............................. 57
SECTION 7.02. Rights of Trustee............................. 58
SECTION 7.03. Individual Rights of Trustee.................. 59
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Page
SECTION 7.04. Trustee's Disclaimer.......................... 59
SECTION 7.05. Notice of Defaults............................ 60
SECTION 7.06. Reports by Trustee to Holders................. 60
SECTION 7.07. Compensation and Indemnity.................... 60
SECTION 7.08. Replacement of Trustee........................ 62
SECTION 7.09. Successor Trustee by Merger, etc.............. 63
SECTION 7.10. Eligibility; Disqualification................. 63
SECTION 7.11. Preferential Collection of Claims Against
Company.................................... 63
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior
Indebtedness............................... 64
SECTION 8.02. No Payment on Securities in Certain
Circumstances.............................. 64
SECTION 8.03. Payment Over of Proceeds upon
Dissolution, etc........................... 66
SECTION 8.04. Subrogation................................... 68
SECTION 8.05. Obligations of Company Unconditional.......... 68
SECTION 8.06. Notice to Trustee............................. 69
SECTION 8.07. Reliance on Judicial Order or Certificate
of Liquidating Agent....................... 70
SECTION 8.08. Trustee's Relation to Senior
Indebtedness............................... 70
SECTION 8.09. Subordination Rights Not Impaired by
Acts or Omissions of the Company or
Holders of Senior Indebtedness............. 71
SECTION 8.10. Securityholders Authorize Trustee To
Effectuate Subordination of Securities..... 71
SECTION 8.11. This Article Not To Prevent Events of
Default.................................... 72
SECTION 8.12. Trustee's Compensation Not Prejudiced......... 72
SECTION 8.13. No Waiver of Subordination Provisions......... 72
SECTION 8.14. Subordination Provisions Not Applicable to
Money Held in Trust for Securityholders;
Payments May Be Paid Prior to
Dissolution................................ 72
SECTION 8.15. Acceleration of Securities.................... 73
ARTICLE NINE
DISCHARGE OF INDENTURE
SECTION 9.01. Termination of Company's Obligations.......... 73
SECTION 9.02. Application of Trust Money.................... 75
SECTION 9.03. Repayment to Company.......................... 75
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Page
SECTION 9.04. Reinstatement................................. 76
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders.................... 76
SECTION 10.02. With Consent of Holders....................... 77
SECTION 10.03. Compliance with Trust Indenture Act........... 79
SECTION 10.04. Revocation and Effect of Consents............. 79
SECTION 10.05. Notation on or Exchange of Securities......... 80
SECTION 10.06. Trustee To Sign Amendments, etc............... 80
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee....................... 81
SECTION 11.02. Severability.................................. 82
SECTION 11.03. Release of a Guarantor........................ 82
SECTION 11.04. Limitation of Guarantor's Liability........... 82
SECTION 11.05. Contribution.................................. 83
SECTION 11.06. Execution of Guarantee........................ 83
SECTION 11.07. Additional Guarantors......................... 84
SECTION 11.08. Subordination of Subrogation and Other
Rights..................................... 84
ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated to
Guarantor Senior Debt...................... 85
SECTION 12.02. No Payment on Guarantees in Certain
Circumstances.............................. 85
SECTION 12.03. Payment Over of Proceeds upon Dissolution,
etc........................................ 87
SECTION 12.04. Subrogation................................... 89
SECTION 12.05. Obligations of Guarantors Unconditional....... 89
SECTION 12.06. Notice to Trustee............................. 90
SECTION 12.07. Reliance on Judicial Order or Certificate
of Liquidating Agent....................... 91
SECTION 12.08. Trustee's Relation to Guarantor Senior
Indebtedness............................... 92
SECTION 12.09. Subordination Rights Not Impaired by Acts
or Omissions of the Guarantors or Holders
of Guarantor Senior Indebtedness........... 92
SECTION 12.10. Securityholders Authorize Trustee To
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Page
Effectuate Subordination of Guarantee...... 92
SECTION 12.11. This Article Not To Prevent Events of
Default.................................... 93
SECTION 12.12. Trustee's Compensation Not Prejudiced......... 93
SECTION 12.13. No Waiver of Guarantee Subordination
Provisions................................. 93
SECTION 12.14. Payments May Be Paid Prior to
Dissolution................................ 94
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls.................. 94
SECTION 13.02. Notices....................................... 94
SECTION 13.03. Communications by Holders with Other
Holders.................................... 96
SECTION 13.04. Certificate and Opinion as to Conditions
Precedent.................................. 96
SECTION 13.05. Statements Required in Certificate or
Opinion.................................... 96
SECTION 13.06. Rules by Trustee, Paying Agent,
Registrar.................................. 97
SECTION 13.07. Governing Law................................. 97
SECTION 13.08. No Recourse Against Others.................... 97
SECTION 13.09. Successors.................................... 97
SECTION 13.10. Counterpart Originals......................... 97
SECTION 13.11. Severability.................................. 98
SECTION 13.12. No Adverse Interpretation of Other
Agreements................................. 98
SECTION 13.13. Legal Holidays................................ 98
SIGNATURES............................................................... 99
EXHIBIT A - Form of Security............................................. A-1
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NOTE: This Table of Contents shall not, for any purpose, be
deemed to be a part of the Indenture.
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INDENTURE dated as of May 29, 1996, among OWENS & MINOR, INC.,
a Virginia corporation (the "Company"), OWENS & MINOR MEDICAL, INC., a Virginia
corporation, NATIONAL MEDICAL SUPPLY CORPORATION, a Delaware corporation, OWENS
& MINOR WEST, INC., a California corporation, KOLEY'S MEDICAL SUPPLY, INC., a
Nebraska corporation, LYONS PHYSICIAN SUPPLY COMPANY, an Ohio corporation, A.
KUHLMAN & CO., a Michigan corporation, STUART MEDICAL, INC., a Pennsylvania
corporation, and CRESTAR BANK, as trustee.
Each party hereto agrees as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Company's 10 7/8% Senior Subordinated Notes due
2006:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with any specified Person. For purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or co-
Registrar. See Section 2.03.
"Asset Disposition" means any sale, transfer or other
disposition (including, without limitation, by merger, consolidation or
sale-and-leaseback transaction) of (i) shares of Capital Stock of a Subsidiary
of the Company (other than directors' qualifying shares) or (ii) property or
assets of the Company or any Subsidiary of the Company; provided, however, that
an Asset Disposition shall not include (a) any sale, transfer or other
disposition of shares of Capital Stock, property or assets by a Subsidiary of
the Company to the Company or to any Wholly Owned Subsidiary of the Company
(other than a Securitization Subsidiary), (b) any sale, transfer or other
disposition of defaulted receivables for collection or any sale, transfer or
other disposition of property or assets in the ordinary course of business, (c)
any isolated sale, transfer or other disposition that does not involve aggregate
consideration in excess of $250,000
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individually, (d) the grant in the ordinary course of business of any
non-exclusive license of patents, trademarks, registrations therefor and other
similar intellectual property, (e) any Lien (or foreclosure thereon) securing
Indebtedness to the extent that such Lien is granted in compliance with Section
4.18, (f) any Restricted Payment permitted by Section 4.06, (g) any disposition
of assets or property in the ordinary course of business to the extent such
property or assets are obsolete, worn out or no longer useful in the Company's
or any of its Subsidiaries' business or (h) any Qualified Securitization
Transaction.
"Average Life" means, as of the date of determination, with
respect to any Indebtedness for borrowed money or Preferred Stock, the quotient
obtained by dividing (i) the sum of the products of the number of years from the
date of determination to the dates of each successive scheduled principal or
liquidation value payments of such Indebtedness or Preferred Stock,
respectively, and the amount of such principal or liquidation value payments, by
(ii) the sum of all such principal or liquidation value payments.
"Board of Directors" means the Board of Directors of the
Company or any Guarantor, as the case may be, or any authorized committee of
that Board.
"Board Resolution" means, with respect to any Person, a duly
adopted resolution of the Board of Directors of such Person.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday that is not a day on which banking institutions in the City of New
York are authorized or obligated by law, resolution or executive order to close.
"Capital Lease Obligations" of any Person means the
obligations to pay rent or other amounts under a lease of (or other Indebtedness
arrangements conveying the right to use) real or personal property of such
Person which are required to be classified and accounted for as a capital lease
or liability on the face of a balance sheet of such Person in accordance with
GAAP. The amount of such obligations shall be the capitalized amount thereof in
accordance with GAAP and the stated maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.
"Capital Stock" of any Person means any and all shares,
interests, participations or other equivalents (however designated)
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of corporate stock of such Person (including any Preferred Stock outstanding on
the Issue Date).
"Common Stock" of any Person means Capital Stock of such
Person that does not rank prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
Vice Chairman of the Board, its President or a Vice President, and by its
Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.
"Consolidated Cash Flow Available for Fixed Charges" of any
Person means for any period the Consolidated Net Income of such Person for such
period increased (to the extent Consolidated Net Income for such period has been
reduced thereby) by the sum of (without duplication) (i) Consolidated Interest
Expense of such Person for such period, plus (ii) Consolidated Income Tax
Expense of such Person for such period, plus (iii) the consolidated depreciation
and amortization expense included in the income statement of such Person for
such period, plus (iv) any other non-cash charges to the extent deducted from or
reflected in Consolidated Net Income except for any non-cash charges that
represent accruals of, or reserves for, cash disbursements to be made in any
future accounting period.
"Consolidated Cash Flow Ratio" of any Person means for any
period the ratio of (i) Consolidated Cash Flow Available for Fixed Charges of
such Person for such period to (ii) the sum of (A) Consolidated Interest Expense
of such Person for such period, plus (B) the annual interest expense with
respect to any Indebtedness proposed to be Incurred by such Person or its
Subsidiaries, minus (C) Consolidated Interest Expense of such Person to the
extent included in clause (ii)(A) with respect to any Indebtedness that will no
longer be outstanding as a result of the Incurrence of the Indebtedness proposed
to be Incurred, plus (D) the annual interest expense with respect to any other
Indebtedness Incurred by such Person or its Subsidiaries since the end of such
period to the extent not included in clause (ii)(A), minus (E) Consolidated
Interest Expense of such Person to the extent included in clause
-4-
(ii)(A) with respect to any Indebtedness that no longer is outstanding as a
result of the Incurrence of the Indebtedness referred to in clause (ii)(D);
provided, however, that in making such computation, the Consolidated Interest
Expense of such Person attributable to interest on any Indebtedness bearing a
floating interest rate shall be computed on a pro forma basis as if the rate in
effect on the date of computation (after giving effect to any hedge in respect
of such Indebtedness that will, by its terms, remain in effect until the earlier
of the maturity of such Indebtedness or the date one year after the date of such
determination) had been the applicable rate for the entire period; provided,
further, however, that, in the event such Person or any of its Subsidiaries has
made any Asset Dispositions or acquisitions of assets not in the ordinary course
of business (including acquisitions of other Persons by merger, consolidation or
purchase of Capital Stock) during or after such period and on or prior to the
date of measurement, such computation shall be made on a pro forma basis as if
the Asset Dispositions or acquisitions had taken place on the first day of such
period. Calculations of pro forma amounts in accordance with this definition
shall be done in accordance with Rule 11-02 of Regulation S-X under the
Securities Act of 1933 or any successor provision.
"Consolidated Income Tax Expense" of any Person means for any
period the consolidated provision for income taxes of such Person for such
period calculated on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" for any Person means for any
period the consolidated interest expense included in a consolidated income
statement (without deduction of interest or finance charge income) of such
Person for such period calculated on a consolidated basis in accordance with
GAAP, plus discount on receivables sold or other discount related to any
receivables securitization transaction (including any Qualified Securitization
Transaction).
"Consolidated Net Income" of any Person means for any period
the consolidated net income (or loss) of such Person for such period determined
on a consolidated basis in accordance with GAAP; provided, however, that there
shall be excluded therefrom (a) the net income (or loss) of any Person acquired
by such Person or a Subsidiary of such Person in a pooling-of-interests
transaction for any period prior to the date of such transaction, (b) the net
income (but not net loss) of any Subsidiary of such Person which is subject to
restrictions which prevent or limit the payment of dividends or the making of
distributions to such Person to the extent of such restrictions (regardless of
any waiver thereof), (c)
-5-
the net income of any Person that is not a Subsidiary of such Person, except to
the extent of the amount of dividends or other distributions representing such
Person's proportionate share of such other Person's net income for such period
actually paid in cash to such Person by such other Person during such period,
(d) gains or losses on Asset Dispositions by such Person or its Subsidiaries,
(e) all extraordinary gains and extraordinary losses determined in accordance
with GAAP and (f) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent Person's assets, any
earnings (or losses) of the successor corporation prior to such consolidation,
merger or transfer of assets.
"Consolidated Net Worth" of any Person means the consolidated
stockholders' equity of such Person, determined on a consolidated basis in
accordance with GAAP, less (without duplication) amounts attributable to
Disqualified Stock of such Person.
"Continuing Director" means a director who either was a member
of the Board of Directors of the Company on the Issue Date or who became a
director of the Company subsequent to the Issue Date and whose election, or
nomination for election by the Company's stockholders, was duly approved by a
majority of the Continuing Directors then on the Board of Directors of the
Company, either by a specific vote or by approval of the proxy statement issued
by the Company on behalf of the entire Board of Directors of the Company in
which such individual is named as nominee for director.
"Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 13.02 or such other address as the
Trustee may give notice to the Company.
"Default" means any event that is, or after notice or lapse of
time or both would become, an Event of Default.
"Designated Senior Indebtedness" means (i) so long as the
Senior Credit Facility is outstanding, the Senior Indebtedness incurred under
the Senior Credit Facility and (ii) thereafter, any other Senior Indebtedness
which has at the time of initial issuance an aggregate outstanding principal
amount in excess of $15 million which has been designated as Designated Senior
Indebtedness by the Board of Directors of the Company at the time of initial
issuance in a resolution delivered to the Trustee.
"Disqualified Stock" of any Person means any Capital Stock of
such Person which, by its terms (or by the terms of any
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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 is redeemable at the option of the
holder thereof, in whole or in part, on or prior to the final maturity of the
Securities.
"Eligible Accounts Receivable" means the face value of all
"eligible receivables" of the Company and its Subsidiaries party to any credit
agreement constituting the Senior Credit Facility (as such term is defined for
purposes of such credit agreement).
"Eligible Inventory" means the face value of all "eligible
inventory" of the Company and its Subsidiaries party to any credit agreement
constituting the Senior Credit Facility (as such term is defined for purposes of
such credit agreement).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC thereunder.
"Expiration Date" has the meaning set forth in the
definition of "Offer to Purchase" below.
"GAAP" means generally accepted accounting principles,
consistently applied, as in effect on the Issue Date in the United States of
America, as 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 is approved by a significant
segment of the accounting profession.
"guarantee" by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing any Indebtedness of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, and including,
without limitation, any obligation of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness, (ii) to purchase property, securities or
services for the purpose of assuring the holder of such Indebtedness of the
payment of such Indebtedness, or (iii) to maintain working capital, equity
capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Indebtedness (and
"guaranteed," "guaranteeing" and "guarantor"
-7-
shall have meanings correlative to the foregoing); provided, however, that the
guarantee by any Person shall not include endorsements by such Person for
collection or deposit, in either case, in the ordinary course of business.
"Guarantee" means the guarantee of the Securities by each
Guarantor under this Indenture.
"Guarantor Senior Indebtedness" means, with respect to any
Guarantor, at any date, (i) the maximum amount of all Indebtedness of such
Guarantor under the Senior Credit Facility, including principal, premium, if
any, and interest on such Indebtedness and all other amounts due on or in
connection with such Indebtedness including all charges, fees and expenses
(without regard to any limitation set forth in the terms thereof and whether or
not such Indebtedness is invalidated or set aside or otherwise legally
unenforceable, unless due to willful misconduct or bad faith on the part of the
lenders under the Senior Credit Facility or their agent), (ii) all other
Indebtedness of such Guarantor for borrowed money, including principal, premium,
if any, and interest on such Indebtedness, unless the instrument under which
such Indebtedness of such Guarantor for borrowed money is created, incurred,
assumed or guaranteed expressly provides that such Indebtedness for borrowed
money is not senior or superior in right of payment to the Guarantee of such
Guarantor, and all renewals, extensions, modifications, amendments or
refinancings thereof and (iii) all interest on any Indebtedness referred to in
clauses (i) and (ii) during the pendency of any bankruptcy or insolvency
proceeding, whether or not allowed thereunder. Notwithstanding the foregoing,
Guarantor Senior Indebtedness shall not include (a) Indebtedness which is
pursuant to its terms or any agreement relating thereto or by operation of law
subordinated or junior in right of payment or otherwise to any other
Indebtedness of such Guarantor (without regard, with respect to the Senior
Credit Facility, to any limitation set forth in the terms thereof and other
than, with respect to the Senior Credit Facility, due to the legal invalidity
thereof, unless due to the willful misconduct or bad faith on the part of the
lenders under the Senior Credit Facility or their agent); provided, however,
that no Indebtedness of such Guarantor shall be deemed to be subordinated or
junior in right of payment or otherwise to any other Indebtedness of such
Guarantor solely by reason of such other Indebtedness being secured and such
Indebtedness not being secured, (b) the Guarantees, (c) any Indebtedness of such
Guarantor to any of its Subsidiaries, (d) any Indebtedness which, when incurred
and without respect to any election under Section 1111(b) of the Bankruptcy Law,
is without recourse to such Guarantor, and (e) any Indebtedness or other
obligation of such Guarantor pursuant to or in connection with any
-8-
Qualified Securitization Transaction (whether entered into before or after the
Issue Date).
"Guarantors" means (i) each of Owens & Minor Medical, Inc., a
Virginia corporation; National Medical Supply Corporation, a Delaware
corporation; Owens & Minor West, Inc., a California corporation; Koley's Medical
Supply, Inc., a Nebraska corporation; Lyons Physician Supply Company, an Ohio
corporation; A. Kuhlman & Co., a Michigan corporation; and Stuart Medical, Inc.,
a Pennsylvania corporation; and (ii) each Material Subsidiary (other than a
Securitization Subsidiary), whether formed or acquired after the Issue Date;
provided, however, that any Material Subsidiary acquired after the Issue Date
which is prohibited from entering into a Guarantee pursuant to restrictions
contained in any debt instrument in existence at the time such Material
Subsidiary was so acquired and not entered into in anticipation or contemplation
of such acquisition shall not be required to become a Guarantor so long as any
such restriction is in existence and to the extent of any such restriction.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered on the books of the Registrar or any co-Registrar.
"Incur" means, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (including by conversion,
exchange or otherwise), assume, guarantee or otherwise become liable in respect
of such Indebtedness or other obligation or the recording, as required pursuant
to GAAP or otherwise, of any such Indebtedness or other obligation on the
balance sheet of such Person (and "Incurrence," "Incurred" and "Incurring" shall
have meanings correlative to the foregoing). Indebtedness of any Person or any
of its Subsidiaries existing at the time such Person becomes a Subsidiary of the
Company (or is merged into or consolidates with the Company or any of its
Subsidiaries), whether or not such Indebtedness was incurred in connection with,
or in contemplation of, such Person becoming a Subsidiary of the Company (or
being merged into or consolidated with the Company or any of its Subsidiaries),
shall be deemed Incurred at the time any such Person becomes a Subsidiary of the
Company or merges into or consolidates with the Company or any of its
Subsidiaries.
"Indebtedness" means (without duplication), with respect to
any Person, whether recourse is to all or a portion of the assets of such Person
and whether or not contingent, (i) every obligation of such Person for money
borrowed, (ii) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations incurred in connection
-9-
with the acquisition of property, assets or businesses, (iii) every
reimbursement obligation of such Person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
Person, (iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business which are not
overdue or which are being contested in good faith), (v) every Capital Lease
Obligation of such Person, (vi) every net obligation under interest rate swap or
similar agreements or foreign currency hedge, exchange or similar agreements of
such Person and (vii) every obligation of the type referred to in clauses (i)
through (vi) of another Person and all dividends of another Person the payment
of which, in either case, such Person has guaranteed or is responsible or liable
for, directly or indirectly, as obligor, guarantor or otherwise. Indebtedness
shall include the liquidation preference and any mandatory redemption payment
obligations in respect of any Disqualified Stock of the Company, and any
Preferred Stock of a Subsidiary of the Company. Indebtedness shall never be
calculated taking into account any cash and cash equivalents held by such
Person. Indebtedness shall not include (A) obligations of the Company or its
Subsidiaries in respect of loans against life insurance policies of which any of
them is the owner not in excess of the aggregate cash values thereof, (B)
guarantees entered into prior to the Issue Date by the Company or its
Subsidiaries in respect of Indebtedness of their customers in an aggregate
amount of not more than $1 million or (C) the obligations of the Company or its
Subsidiaries in respect of any Qualified Securitization Transaction.
"Indenture" means this Indenture as amended or supplemented
from time to time.
"Initial Securitization" means the transactions entered into
in connection with the Amended and Restated Receivables Purchase Agreement dated
as of May 28, 1996, among O&M Funding Corp., the Company, Receivables Capital
Corporation and Bank of America National Trust and Savings Association, as
further amended, restated, supplemented or otherwise modified from time to time.
"Interest Payment Date" means the stated maturity of an
installment of interest on the Securities.
"Investment" by any Person means any direct or indirect loan,
advance, guarantee or other extension of credit or capital contribution to (by
means of transfers of cash or other property to others or payments for property
or services for the account or use of others, or otherwise), or purchase or
acquisition of Capital
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Stock, bonds, notes, debentures or other securities or evidence of Indebtedness
issued by any other Person.
"Issue Date" means the original issue date of the Securities,
May 29, 1996.
"Lien" means, with respect to any property or assets, any
mortgage or deed of trust, pledge, hypothecation, assignment, security interest,
lien, charge, easement (other than any easement not materially impairing
usefulness or marketability), encumbrance, preference, priority or other
security agreement with respect to such property or assets (including, without
limitation, any conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing).
"Material Subsidiary" means any Subsidiary of the Company
which would constitute a "significant subsidiary" of the Company as defined in
Rule 1.02 of Regulation S-X promulgated by the SEC.
"Maturity Date" means the date, which is set forth on the face
of the Securities, on which the Securities will mature.
"Moody's" means Moody's Investors Service, Inc. and its
successors.
"Net Available Proceeds" from any Asset Disposition by any
Person means cash or readily marketable cash equivalents received (including by
way of sale or discounting of a note, installment receivable or other
receivable, but excluding any other consideration received in the form of
assumption by the acquiror of Indebtedness or other obligations relating to such
properties or assets or received in any other non-cash form) therefrom by such
Person, including any cash received by way of deferred payment or upon the
monetization or other disposition of any non-cash consideration (including notes
or other securities) received in connection with such Asset Disposition, net of
(i) all legal, title and recording tax expenses, commissions and other fees and
expenses incurred and all federal, state, foreign and local taxes required to be
accrued as a liability as a consequence of such Asset Disposition, (ii) all
payments made by such Person or its Subsidiaries on any Indebtedness which is
secured by such assets in accordance with the terms of any Lien upon or with
respect to such assets or which must by the terms of such Lien, or in order to
obtain a necessary consent to such Asset Disposition or by applicable law, be
repaid out of the proceeds from such Asset Disposition, (iii) all payments made
with respect to liabilities associated with the assets which are the subject of
the Asset Disposition, including, without limitation, trade payables and
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other accrued liabilities, (iv) appropriate amounts to be provided by such
Person or any Subsidiary thereof, as the case may be, as a reserve in accordance
with GAAP against any liabilities associated with such assets and retained by
such Person or any Subsidiary thereof, as the case may be, after such Asset
Disposition, including, without limitation, liabilities under any
indemnification obligations and severance and other employee termination costs
associated with such Asset Disposition, until such time as such amounts are no
longer reserved or such reserve is no longer necessary (at which time any
remaining amounts will become Net Available Proceeds to be allocated in
accordance with the provisions of Section 4.05(a)(iii)) and (v) all
distributions and other payments made to minority interest holders in
Subsidiaries of such Person or joint ventures as a result of such Asset
Disposition.
"O&M Funding Corp." means O&M Funding Corp., a Virginia
corporation, and its successors.
"Obligations" means any principal, premiums, interest,
penalties, fees and other liabilities payable under the documentation governing
any Indebtedness.
"Offer" has the meaning set forth in the definition of
"Offer to Purchase" below.
"Offer to Purchase" means a written offer (the "Offer") sent
by the Company by first class mail, postage prepaid, to each Holder at his
address appearing in the register for the Securities on the date of the Offer
offering to purchase up to the principal amount of Securities specified in such
Offer at the purchase price specified in such Offer (as determined pursuant to
this Indenture). Unless otherwise required by applicable law, the Offer shall
specify an expiration date (the "Expiration Date") of the Offer to Purchase
which shall be not less than 30 days nor more than 60 days after the date of
such Offer and a settlement date (the "Purchase Date") for purchase of
Securities within five Business Days after the Expiration Date. The Company
shall notify the Trustee at least 15 Business Days (or such shorter period as is
acceptable to the Trustee) prior to the mailing of the Offer of the Company's
obligation to make an Offer to Purchase, and the Offer shall be mailed by the
Company or, at the Company's request, by the Trustee in the name and at the
expense of the Company. The Offer shall contain all the information required by
applicable law to be included therein. The Offer shall contain all instructions
and materials necessary to enable such Holders to tender Securities pursuant to
the Offer to Purchase. The Offer shall also state:
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(1) the Section of this Indenture pursuant to which the Offer
to Purchase is being made;
(2) the Expiration Date and the Purchase Date;
(3) the aggregate principal amount of the outstanding Securities
offered to be purchased by the Company pursuant to the Offer
to Purchase (including, if less than 100%, the manner by which
such amount has been determined pursuant to the Section of
this Indenture requiring the Offer to Purchase) (the "Purchase
Amount");
(4) the purchase price to be paid by the Company for each $1,000
aggregate principal amount of Securities accepted for payment
(as specified pursuant to this Indenture) (the "Purchase
Price");
(5) that the Holder may tender all or any portion of the
Securities registered in the name of such Holder and that any
portion of a Security tendered must be tendered in an integral
multiple of $1,000 principal amount;
(6) the place or places where Securities are to be
surrendered for tender pursuant to the Offer to Purchase;
(7) that interest on any Security not tendered or tendered
but not purchased by the Company pursuant to the Offer to
Purchase will continue to accrue;
(8) that on the Purchase Date the Purchase Price will become due
and payable upon each Security being accepted for payment
pursuant to the Offer to Purchase and that interest thereon
shall cease to accrue on and after the Purchase Date;
(9) that each Holder electing to tender all or any portion of
a Security pursuant to the Offer to Purchase will be
required to surrender such Security at the place or
places specified in the Offer prior to the close of
business on the Expiration Date (such Security being, if
the Company or the Trustee so requires, duly endorsed by,
or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or his attorney duly
authorized in writing);
(10) that Holders will be entitled to withdraw all or any
portion of Securities tendered if the Company (or its
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Paying Agent) receives, not later than the close of business
on the fifth Business Day next preceding the Expiration Date,
a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the
Security the Holder tendered, the certificate number of the
Security the Holder tendered and a statement that such Holder
is withdrawing all or a portion of his tender;
(11) that (a) if Securities in an aggregate principal amount
less than or equal to the Purchase Amount are duly
tendered and not withdrawn pursuant to the Offer to
Purchase, the Company shall purchase all such Securities
and (b) if Securities in an aggregate principal amount in
excess of the Purchase Amount are tendered and not
withdrawn pursuant to the Offer to Purchase, the Company
shall purchase Securities having an aggregate principal
amount equal to the Purchase Amount on a pro rata basis
(with such adjustments as may be deemed appropriate so
that only Securities in denominations of $1,000 or
integral multiples thereof shall be purchased); and
(12) that in the case of any Holder whose Security is
purchased only in part, the Company shall execute and the
Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Security or
Securities, of any authorized denomination as requested
by such Holder, in an aggregate principal amount equal to
and in exchange for the unpurchased portion of the
Security so tendered.
An Offer to Purchase shall be governed by and effected in
accordance with the provisions above pertaining to any Offer.
"Officer" means the Chairman, the President, any Vice
President, the Chief Financial Officer, the Treasurer, or the
Secretary of the Company.
"Officers' Certificate" means a certificate signed by two
Officers or by an Officer and an Assistant Treasurer or Assistant Secretary of
the Company complying with Sections 13.04 and 13.05.
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee. The counsel may be an
employee of or counsel to the Company or the Trustee.
"Permitted Investments" means (i) Investments in
marketable, direct obligations issued or guaranteed by the United
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States of America, or any governmental entity or agency or political subdivision
thereof (provided, that the good faith and credit of the United States of
America is pledged in support thereof), maturing within one year of the date of
purchase; (ii) Investments in commercial paper issued by corporations or
financial institutions maturing within 180 days from the date of the original
issue thereof, and rated "P-1" or better by Moody's Investors Service or "A-1"
or better by Standard & Poor's Corporation or an equivalent rating or better by
any other nationally recognized securities rating agency; (iii) Investments in
certificates of deposit issued or acceptances accepted by or guaranteed by any
bank or trust company organized under the laws of the United States of America
or any state thereof or the District of Columbia, in each case having capital,
surplus and undivided profits totalling more than $500,000,000, maturing within
one year of the date of purchase; (iv) Investments representing Capital Stock or
obligations issued to the Company or any of its Subsidiaries in the course of
the good faith settlement of claims against any other Person or by reason of a
composition or readjustment of debt or a reorganization of any debtor of the
Company or any of its Subsidiaries; (v) deposits, including interest-bearing
deposits, maintained in the ordinary course of business in banks; (vi) any
acquisition of the Capital Stock of any Person; provided, however, that after
giving effect to any such acquisition such Person shall become a Subsidiary of
the Company; (vii) trade receivables and prepaid expenses, in each case arising
in the ordinary course of business; provided, however, that such receivables and
prepaid expenses would be recorded as assets of such Person in accordance with
GAAP; (viii)endorsements for collection or deposit in the ordinary course of
business by such Person of bank drafts and similar negotiable instruments of
such other Person received as payment for ordinary course of business trade
receivables; (ix)any interest swap or hedging obligation with an unaffiliated
Person otherwise permitted by this Indenture; (x)Investments received as
consideration for an Asset Disposition in compliance with the provisions of
Section 4.05; (xi)Investments for which the sole consideration provided is
Capital Stock of the Company (other than Disqualified Stock); (xii)loans and
advances to employees made in the ordinary course of business; (xiii)
Investments outstanding on the Issue Date and (xiv) Investments made in any
Securitization Subsidiary or Special Purpose Vehicle in connection with and
required pursuant to the terms of any Qualified Securitization Transaction.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
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"Preferred Stock," as applied to the Capital Stock of any
Person, means Capital Stock of such Person of any class or classes (however
designated) that ranks prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.
"principal" of a debt security means the principal of the
security plus, when appropriate, the premium, if any, on the security.
"Purchase Amount" has the meaning set forth in the
definition of "Offer to Purchase" above.
"Purchase Date" has the meaning set forth in the
definition of "Offer to Purchase" above.
"Purchase Price" has the meaning set forth in the
definition of "Offer to Purchase" above.
"Qualified Securitization Transaction" means the Initial
Securitization and any other transaction or series of transactions that has been
or may be entered into by the Company or any of its Subsidiaries in connection
with or reasonably related to a transaction or series of transactions in which
the Company or any of its Subsidiaries may sell, convey or otherwise transfer to
(i) a Securitization Subsidiary or (ii) any other Person, or may grant a
security interest in, any Receivables and Receivables Related Assets or
interests therein secured by the merchandise or services financed thereby
(whether such Receivables and Receivables Related Assets are then existing or
arising in the future) of the Company or any of its Subsidiaries, and any assets
related thereto including, without limitation, all security interests in
merchandise or services financed thereby, all collections received (including
recoveries) and proceeds of such Receivables and Receivables Related Assets, and
other assets which are customarily sold or in respect of which security
interests are customarily granted in connection with securitization transactions
involving such assets.
"Receivables" means any right of payment, whether constituting
an account, chattel paper, instrument, general intangible or otherwise, arising
in connection with the sale, lease or financing by the Company or any Subsidiary
of the Company of merchandise or rendering of services, and monies due
thereunder.
"Receivables Related Assets" means (i) any rights arising
under the documentation governing or relating to Receivables
-16-
(including rights in respect of Liens securing such Receivables and other credit
support in respect of such Receivables), (ii) any proceeds of such Receivables
and any lockboxes or accounts in which such proceeds are deposited, (iii) spread
accounts and other similar accounts (and any amounts on deposit therein)
established in connection with a Qualified Securitization Transaction, (iv) any
warranty, indemnity, dilution and other intercompany claim arising out of the
documentation evidencing such Qualified Securitization Transaction and (v) other
assets that are customarily transferred or in respect of which security
interests are customarily granted in connection with asset securitization
transactions involving accounts receivable.
"redemption date," when used with respect to any Security to
be redeemed, means the date fixed for such redemption pursuant to this
Indenture.
"redemption price," when used with respect to any Security to
be redeemed, means the price fixed for such redemption pursuant to this
Indenture as set forth in the form of Security annexed as Exhibit A.
"Related Person" of any Person means any other Person directly
or indirectly owning (a) 5% or more of the outstanding Common Stock of such
Person (or, in the case of a Person that is not a corporation, 5% or more of the
equity interest in such Person) or (b) 5% or more of the combined voting power
of the Voting Stock of such Person.
"SEC" means the Securities and Exchange Commission.
"Securities" means the 10 7/8% Senior Subordinated Notes due
2006, as amended or supplemented from time to time pursuant to the terms of this
Indenture, that are issued under this Indenture.
"Securitization Subsidiary" means O&M Funding Corp. and any
other Wholly Owned Subsidiary of the Company which engages in no activities
other than those reasonably related to or in connection with the entering into
of securitization transactions and which is designated by the Board of Directors
of the Company (as provided below) as a Securitization Subsidiary provided that
with respect to O&M Funding Corp. or any such other Wholly Owned Subsidiary (a)
no portion of the indebtedness or any other obligations (contingent or
otherwise) of any such Subsidiary (i) is guaranteed by the Company or any other
Subsidiary of the Company other than pursuant to Standard Securitization
Obligations, (ii) is recourse to or obligates the Company or any other
Subsidiary of the Company in any way other than pursuant to Standard
Securitization
-17-
Obligations or (iii) subjects the Company or any other Subsidiary of the
Company, directly or indirectly, contingently or otherwise, to any Lien or to
the satisfaction thereof, other than pursuant to Standard Securitization
Obligations, (b) neither the Company nor any other Subsidiary of the Company (i)
provides any credit support to or (ii) has any material contract, agreement,
arrangement or understanding no less favorable to the Company or such Subsidiary
than could be obtained from an unrelated person (other than, in the case of
subclauses (i) and (ii) of this clause (b), entered into in the ordinary course
of business in connection with a Qualified Securitization Transaction and
intercompany notes relating to the sale of Receivables to such Securitization
Subsidiary) with any such Subsidiary and (c) neither the Company nor any
Subsidiary of the Company has any obligation to maintain or preserve the
financial condition of any such Subsidiary or to cause such entity to achieve
certain levels of operating results. Any such designation by the Board of
Directors of the Company (other than with respect to O&M Funding Corp.) shall be
evidenced to the Trustee by filing with the Trustee a certified copy of the
resolutions of the Board of Directors of the Company giving effect to such
designation.
"Senior Credit Facility" means the Credit Agreement, dated as
of May 24, 1996, among the Company as borrower thereunder, any Subsidiaries of
the Company as guarantors thereunder and NationsBank, N.A., as agent on behalf
of itself and the other lenders named therein, including any deferrals,
renewals, extensions, replacements, refinancings or refundings thereof, or
amendments, modifications or supplements thereto and any agreement providing
therefor whether by or with the same or any other lender, creditors, group of
lenders or group of creditors and including related notes, guarantee agreements
and other instruments and agreements executed in connection therewith.
"Senior Indebtedness" means, at any date, (i) all Indebtedness
of the Company under the Senior Credit Facility, including principal, premium,
if any, and interest on such Indebtedness and all other amounts due on or in
connection with such Indebtedness including all charges, fees and expenses, (ii)
all other Indebtedness of the Company for borrowed money, including principal,
premium, if any, and interest on such Indebtedness, unless the instrument under
which such Indebtedness of the Company for money borrowed is created, incurred,
assumed or guaranteed expressly provides that such Indebtedness for money
borrowed is not senior or superior in right of payment to the Securities, and
all renewals, extensions, modifications, amendments or refinancings thereof and
(iii) all interest on any Indebtedness referred to in clauses (i) and (ii)
accruing during the pendency of any bankruptcy
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or insolvency proceeding, whether or not allowed thereunder. Notwithstanding the
foregoing, Senior Indebtedness shall not include (a) Indebtedness which is
pursuant to its terms or any agreement relating thereto or by operation of law
subordinated or junior in right of payment or otherwise to any other
Indebtedness of the Company; provided, however, that no Indebtedness of the
Company shall be deemed to be subordinate or junior in right of payment or
otherwise to any other Indebtedness of the Company solely by reason of such
other Indebtedness being secured and such Indebtedness not being secured, (b)
the Securities, (c) any Indebtedness of the Company to any Subsidiary of the
Company, (d) any Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of the Bankruptcy Law, is without recourse to the
Company, and (e) any Indebtedness or other obligation of the Company pursuant to
or in connection with any Qualified Securitization Transaction (whether entered
into before or after the Issue Date).
"Special Purpose Vehicle" means a trust, partnership or other
entity established by the Company or its Subsidiaries to implement a Qualified
Securitization Transaction.
"Standard Securitization Obligations" means representations,
warranties, covenants and indemnities (including those related to servicing)
entered into by the Company or any Subsidiary which are reasonably customary in
Qualified Securitization Transactions.
"Stated Maturity," when used with respect to any Security or
any installment of interest thereon, means the date specified in such Security
as the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"Subsidiary" of any Person means (i) a corporation more than
50% of the outstanding Voting Stock of which is owned, directly or indirectly,
by such Person or by one or more other Subsidiaries of such Person or by such
Person and one or more other Subsidiaries thereof or (ii) any other Person
(other than a corporation) in which such Person, or one or more other
Subsidiaries of such Person or such Person and one or more other Subsidiaries
thereof, directly or indirectly, has at least a majority ownership and voting
power relating to the policies, management and affairs thereof; provided,
however, that any Special Purpose Vehicle shall not be a Subsidiary of the
Company for purposes of this Indenture.
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"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
ss.ss. 77aaa-77bbbb) as in effect on the date of this Indenture, except as
provided in Section 10.03.
"Trustee" means the party named as such in this Indenture
until a successor replaces it in accordance with the provisions of this
Indenture and thereafter means such successor.
"Trust Officer" means any officer within the corporate trust
department (or any successor group of the Trustee) including any vice president,
assistant vice president, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer to
whom such trust matter is referred because of his knowledge of and familiarity
with the particular subject.
"Voting Stock" of any Person means the Capital Stock of such
Person which ordinarily has voting power for the election of directors (or
persons performing similar functions) of such Person, whether at all times or
only so long as no senior class of securities has such voting power by reason of
any contingency.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of
such Person all of the outstanding Capital Stock or other ownership 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.
Term Defined in Section
---- ------------------
"Bankruptcy Law" 6.01
"Change of Control" 4.14
"Custodian" 6.01
"Event of Default" 6.01
"Funding Guarantor" 11.05
"Guarantor Blockage Period" 12.02(a)
"Guarantor Payment Blockage Notice" 12.02(a)
"Paying Agent" 2.03
"Payment Blockage Notice" 8.02(a)
"Payment Blockage Period" 8.02(a)
"Registrar" 2.03
"Required Filing Date 4.12
"Subordinated Reorganization Securities" 8.03(c)
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"United States Government Obligation" 9.01
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company
or any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule and not otherwise defined herein have the meanings assigned to them
therein.
SECTION 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles in effect from time to time, and any other reference in this
Indenture to "generally accepted accounting principles" refers to GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words
in the plural include the singular;
(5) provisions apply to successive events and
transactions; and
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(6) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section
or other subdivision.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Trustee's certificates of
authentication shall be substantially in the form of Exhibit A. The Securities
may have notations, legends or endorsements required by law, stock exchange rule
or usage. Any notations, legends or endorsements not contained in the form of
Security contained in Exhibit A shall be delivered in writing to the Trustee.
The Company shall approve the form of the Securities and any notation, legend or
endorsement on them. Each Security shall be dated the date of its
authentication.
The terms and provisions contained in the form of the
Securities, annexed hereto as Exhibit A, shall constitute, and are hereby
expressly made, a part of this Indenture.
SECTION 2.02. Execution and Authentication.
Two Officers shall sign the Securities for the Company by
facsimile signature. The Company's seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds
that office at the time the Trustee authenticates the Security, the Security
shall be valid nevertheless.
A Security shall not be valid until the Trustee manually signs
the certificate of authentication on the Security. The signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.
The Trustee shall authenticate Securities for original issue
in the aggregate principal amount of up to $150,000,000, upon a written order of
the Company signed by two Officers or by an Officer and an Assistant Treasurer
or Assistant Secretary of the Company. The order shall specify the amount of
Securities to be authenticated and the date on which the original issue of
Securities is to be authenticated. The aggregate principal amount of Securities
outstanding at any time may not exceed $150,000,000 except as provided in
Section 2.07.
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The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Securities other than upon original issuance. The
Company shall pay all fees payable to the authenticating agent. Any
authenticating agent appointed hereunder shall be entitled to the benefits of
Section 7.07. Unless limited by the terms of such appointment, any
authenticating agent may authenticate Securities whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company or an Affiliate as provided in Section 7.03.
The Securities shall be issuable only in registered form
without coupons and only in denominations of $1,000 and any integral multiple
thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where
Securities may be presented for registration of transfer or for exchange
("Registrar") and an office or agency where Securities may be presented for
payment ("Paying Agent"). The Company may have one or more co-Registrars and one
or more additional paying agents. The term "Paying Agent" includes any
additional paying agent.
The Company shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent and shall, if required,
incorporate the provisions of the TIA. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation in accordance with the provisions of Section 7.07.
The Company initially appoints the Trustee as Registrar and
Paying Agent. The Company shall give written notice to the Trustee in the event
that the Company decides to act as Registrar or Paying Agent.
SECTION 2.04. Paying Agent To Hold Money in Trust.
The Company shall require each Paying Agent to agree in
writing to hold in trust for the benefit of Securityholders or the Trustee all
money held by the Paying Agent for the payment of principal of or interest on
the Securities (whether such money has been paid to it by the Company or any
other obligor on the Securities), and the Company and the Paying Agent shall
each notify
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the Trustee of any default by the Company (or any other obligor on the
Securities) in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate the money and hold it as a separate trust fund.
The Company at any time may require a Paying Agent to pay all money held by it
to the Trustee and account for any funds disbursed and the Trustee may at any
time during the continuance of any payment default, upon written request to a
Paying Agent, require such Paying Agent to pay all money held by it to the
Trustee and to account for any funds disbursed. Upon making such payment the
Paying Agent shall have no further liability for the money delivered to the
Trustee.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Securityholders. If the Trustee is not the Registrar, the Company
shall furnish to the Trustee at least five Business Days before each Interest
Payment Date and at such other times as the Trustee may request in writing a
list in such form and as of such date as the Trustee may reasonably require of
the names and addresses of Securityholders.
SECTION 2.06. Transfer and Exchange.
When Securities are presented to the Registrar or a
co-Registrar with a request to register the transfer or to exchange them for an
equal principal amount of Securities of other authorized denominations, the
Registrar shall register the transfer or make the exchange as requested if its
requirements for such transactions are met. To permit registrations of transfers
and exchanges, the Company shall execute and the Trustee shall authenticate
Securities. The date of any Security issued pursuant to this Section 2.06 shall
be the date of such transfer or exchange. No service charge shall be made to the
Securityholder for any registration of transfer or exchange, but the Company may
require from the Securityholder payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable upon
exchanges pursuant to an Offer to Purchase or Section 2.10, 3.06 or 10.05, in
which event the Company shall be responsible for the payment of such taxes).
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if
the Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the
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Trustee shall authenticate a replacement Security if the Trustee's requirements
are met. An indemnity bond in an amount sufficient in the judgment of the
Company and the Trustee to protect the Company, the Trustee or any Agent from
any loss which any of them may suffer if a Security is replaced may be required
by the Trustee or the Company. The Company and the Trustee each may charge such
Holder for its expenses in replacing such Security.
Every replacement Security is an additional obligation of the
Company.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all Securities that
have been authenticated by the Trustee except for those cancelled by it, those
delivered to it for cancellation and those described in this Section as not
outstanding. Except as provided in paragraph 5(b) of the Securities, a Security
does not cease to be outstanding because the Company or one of its Affiliates
holds the Security.
If a Security is replaced pursuant to Section 2.07, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Company, a Subsidiary or
an Affiliate of the Company) holds on a redemption date or Maturity Date money
sufficient to pay the principal of, and interest on Securities payable on that
date, then on and after that date such Securities cease to be outstanding and
interest on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal
amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company, any Guarantor or any of their respective
Affiliates shall be disregarded, except that for the purposes of determining
whether the Trustee shall be protected in relying on any such direction, waiver
or consent, only Securities that the Trustee actually knows are so owned shall
be so disregarded.
The Trustee may require an Officers' Certificate listing
securities owned by the Company, any Guarantor or any of their respective
Affiliates.
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SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities.
Temporary Securities shall be substantially in the form of definitive Securities
but may have variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Securities in exchange for temporary
Securities. Until such exchange, temporary Securities shall be entitled to the
same rights, benefits and privileges as definitive Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee
for cancellation. The Registrar and the Paying Agent shall forward to the
Trustee any Securities surrendered to them for transfer, exchange or payment.
The Trustee and no one else shall cancel all Securities surrendered for
transfer, exchange, payment or cancellation. The Company may not issue new
Securities to replace, or reissue or resell, Securities which the Company has
redeemed, paid, purchased on the open market or otherwise, or otherwise acquired
or have been delivered to the Trustee for cancellation. The Trustee (subject to
the record-retention requirements of the Exchange Act) may, but shall not be
required to destroy cancelled Securities.
SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the
Securities, it shall pay the defaulted interest, plus any interest payable on
the defaulted interest pursuant to Section 4.01 hereof, to the persons who are
Securityholders on a subsequent special record date, and such term, as used in
this Section 2.12 with respect to the payment of any defaulted interest, shall
mean the fifteenth day next preceding the date fixed by the Company for the
payment of defaulted interest, whether or not such day is a Business Day. At
least 15 days before such special record date, the Company shall mail to each
Securityholder and to the Trustee a notice that states such special record date,
the payment date and the amount of defaulted interest to be paid.
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ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company wants to redeem Securities pursuant to
paragraph 5 of the Securities at the applicable redemption price set forth
thereon, it shall notify the Trustee in writing of the redemption date and the
principal amount of Securities to be redeemed.
The Company shall give the notice provided for in this Section
3.01 at least 45 days before the redemption date (unless a shorter notice shall
be agreed to by the Trustee in writing), together with an Officers' Certificate
stating that such redemption will comply with the conditions contained herein.
SECTION 3.02. Selection of Securities To Be Redeemed.
If less than all of the Securities are to be redeemed pursuant
to paragraph 5 thereof, the Trustee shall select the Securities to be redeemed
pro rata or by lot or in such other manner as the Trustee shall deem appropriate
and fair and in such a manner as to comply with any applicable requirements of
the New York Stock Exchange. The Trustee shall make the selection from the
Securities then outstanding, subject to redemption and not previously called for
redemption. The Trustee may select for redemption portions (equal to $1,000 or
any integral multiple thereof) of the principal of Securities that have
denominations larger than $1,000. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a redemption
date, the Company shall mail a notice of redemption by first class mail to each
Holder whose Securities are to be redeemed.
The notice shall identify the Securities to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price;
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(3) the CUSIP number;
(4) the name and address of the Paying Agent to which
the Securities are to be surrendered for redemption;
(5) that Securities called for redemption must be
surrendered to the Paying Agent to collect the redemption
price;
(6) that, unless the Company defaults in making the redemption
payment, interest on Securities called for redemption ceases to accrue
on and after the redemption date and the only remaining right of the
Holders is to receive payment of the redemption price upon surrender to
the Paying Agent; and
(7) if any Security is being redeemed in part, the portion of
the principal amount of such Security to be redeemed and that, after
the redemption date, upon surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion thereof
will be issued.
At the Company's request, the Trustee shall give the notice of
redemption on behalf of the Company, in the Company's name and at the Company's
expense.
SECTION 3.04. Effect of Notice of Redemption.
Once a notice of redemption is mailed, Securities called for
redemption become due and payable on the redemption date and at the redemption
price. Upon surrender to the Paying Agent, such Securities shall be paid at the
redemption price, plus accrued interest thereon to the redemption date, but
interest installments whose maturity is on or prior to such redemption date
shall be payable to the Holders of record at the close of business on the
relevant record dates referred to in the Securities. The Trustee shall not be
required to (i) issue, authenticate, register the transfer of or exchange any
Security during a period beginning 15 days before the date a notice of
redemption is mailed and ending at the close of business on the date the
redemption notice is mailed, or (ii) register the transfer or exchange of any
Security so selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.
SECTION 3.05. Deposit of Redemption Price.
At least one Business Day before the redemption date, the
Company shall deposit with the Paying Agent (or if the Company is
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its own Paying Agent, shall, on or before the redemption date, segregate and
hold in trust) money sufficient to pay the redemption price of and accrued
interest on all Securities to be redeemed on that date other than Securities or
portions thereof called for redemption on that date which have been delivered by
the Company to the Trustee for cancellation.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the
Trustee shall authenticate for the Holder a new Security equal in principal
amount to the unredeemed portion of the Security surrendered.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest on the
Securities in the manner provided in the Securities. An installment of principal
or interest shall be considered paid on the date due if the Trustee or Paying
Agent (other than the Company, a Subsidiary or an Affiliate of the Company)
holds on that date money designated for and sufficient to pay the installment in
full and is not prohibited from paying such money to the Holders of the
Securities pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the
same rate per annum borne by the Securities. The Company shall pay interest on
overdue installments of interest at the same rate per annum borne by the
Securities, to the extent lawful.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The
City of New York, an office or agency where Securities may be surrendered for
registration of transfer or exchange or for presentation for payment and where
notices and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company shall give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 13.02.
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The Company may also from time to time designate one or more
other offices or agencies where the Securities may be presented or surrendered
for any or all such purposes and may from time to time rescind such
designations; provided that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York, for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates Harris Trust Co., 77 Water
Street, 5th Floor, New York, New York 10005 as one such office or agency of the
Company.
SECTION 4.03. Limitation on Transactions with
Affiliates and Related Persons.
The Company will not, and will not permit any of its
Subsidiaries to, enter into directly or indirectly any transaction with an
Affiliate or Related Person of the Company (other than the Company or a
Subsidiary of the Company), including, without limitation, the purchase, sale,
lease or exchange of property, the rendering of any service, or the making of
any guarantee, loan, advance or Investment, either directly or indirectly,
involving aggregate consideration in excess of $500,000 unless (i) a majority of
the disinterested directors of the Board of Directors of the Company determines,
in its good faith judgment evidenced by a resolution of such Board of Directors
filed with the Trustee, that such transaction is in the best interests of the
Company or such Subsidiary, as the case may be; and (ii) such transaction is, in
the opinion of a majority of the disinterested directors of the Board of
Directors of the Company evidenced by a resolution of such Board of Directors
filed with the Trustee, on terms no less favorable to the Company or such
Subsidiary, as the case may be, than those that could be obtained in a
comparable arm's-length transaction with an entity that is not an Affiliate or a
Related Person.
The provisions of this Section 4.03 shall not apply to (i) any
Qualified Securitization Transaction, (ii) any employment agreement entered into
by the Company or any of its Subsidiaries in the ordinary course of business,
(iii) transactions permitted by the provisions of Section 4.06, (iv) the payment
of reasonable fees to directors of the Company or its Subsidiaries and (v)
Investments in employees in the ordinary course of business.
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SECTION 4.04. Limitation on Indebtedness.
The Company will not, and will not permit any of its
Subsidiaries to, Incur, directly or indirectly, any Indebtedness, except: (i)
Indebtedness of the Company or its Subsidiaries, if immediately after giving
effect to the Incurrence of such Indebtedness and the receipt and application of
the net proceeds thereof, the Consolidated Cash Flow Ratio of the Company for
the four full fiscal quarters for which quarterly or annual financial statements
are available next preceding the Incurrence of such Indebtedness, calculated on
a pro forma basis as if such Indebtedness had been Incurred on the first day of
such four full fiscal quarters, would be greater than 2.00 to 1.00 if such
Indebtedness is Incurred on or before December 31, 1997 and 2.25 to 1.00 if such
Indebtedness is Incurred after December 31, 1997; (ii) Indebtedness of the
Company, and guarantees of such Indebtedness by any Guarantor, Incurred under
the Senior Credit Facility in an aggregate principal amount outstanding at any
one time not to exceed the greater of (x) $225 million or (y) the sum of (A) 85%
of Eligible Accounts Receivable and (B) 50% of Eligible Inventory; (iii)
Indebtedness owed by the Company to any Wholly Owned Subsidiary of the Company
(other than a Securitization Subsidiary) or Indebtedness owed by a Subsidiary of
the Company to the Company or a Wholly Owned Subsidiary of the Company (other
than a Securitization Subsidiary); provided, however, that upon either (I) the
transfer or other disposition by such Wholly Owned Subsidiary or the Company of
any Indebtedness so permitted under this clause (iii) to a Person other than the
Company or another Wholly Owned Subsidiary of the Company (other than a
Securitization Subsidiary) or (II) the issuance (other than directors'
qualifying shares), sale, transfer or other disposition of shares of Capital
Stock or other ownership interests (including by consolidation or merger) of
such Wholly Owned Subsidiary to a Person other than the Company or another such
Wholly Owned Subsidiary of the Company (other than a Securitization Subsidiary),
the provisions of this clause (iii) shall no longer be applicable to such
Indebtedness and such Indebtedness shall be deemed to have been Incurred at the
time of any such issuance, sale, transfer or other disposition, as the case may
be; (iv) Indebtedness of the Company or its Subsidiaries under any interest rate
or currency swap agreement to the extent entered into to hedge any other
Indebtedness permitted under this Indenture and any interest rate swap agreement
entered into in connection with any Qualified Securitization Transaction; (v)
Indebtedness Incurred to renew, extend, refinance or refund (collectively for
purposes of this clause (v) to "refund") any Indebtedness outstanding on the
Issue Date and Indebtedness Incurred under the prior clause (i) above or the
Securities; provided, however, that (I) such Indebtedness does not exceed the
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principal amount (or accrued amount, if less) of Indebtedness so refunded plus
the amount of any premium required to be paid in connection with such refunding
pursuant to the terms of the Indebtedness refunded or the amount of any premium
reasonably determined by the Company as necessary to accomplish such refunding
by means of a tender offer, exchange offer, or privately negotiated repurchase,
plus the expenses of the Company or such Subsidiary incurred in connection
therewith and (II)(A) in the case of any refunding of Indebtedness that is pari
passu with the Securities, such refunding Indebtedness is made pari passu with
or subordinate in right of payment to the Securities and, in the case of any
refunding of Indebtedness that is subordinate in right of payment to the
Securities, such refunding Indebtedness is subordinate in right of payment to
the Securities on terms no less favorable to the Holders than those contained in
the Indebtedness being refunded, (B) in either case, the refunding Indebtedness
by its terms, or by the terms of any agreement or instrument pursuant to which
such Indebtedness is issued, does not have an Average Life that is less than the
remaining Average Life of the Indebtedness being refunded and does not permit
redemption or other retirement (including pursuant to any required offer to
purchase to be made by the Company or a Subsidiary of the Company) of such
Indebtedness at the option of the holder thereof prior to the final stated
maturity of the Indebtedness being refunded, other than a redemption or other
retirement at the option of the holder of such Indebtedness (including pursuant
to a required offer to purchase made by the Company or a Subsidiary of the
Company) which is conditioned upon a change of control of the Company pursuant
to provisions substantially similar to those contained in Section 4.14 and (C)
any Indebtedness Incurred to refund any other Indebtedness is Incurred by the
obligor on the Indebtedness being refunded or by the Company; (vi) Indebtedness
of the Company or its Subsidiaries, not otherwise permitted to be Incurred
pursuant to clauses (i) through (v) above, which, together with any other
outstanding Indebtedness Incurred pursuant to this clause (vi), has an aggregate
principal amount not in excess of $15 million at any time outstanding; and (vii)
Indebtedness of the Company under the Securities and Indebtedness of the
Guarantors under the Guarantees.
Notwithstanding anything in this Indenture to the contrary,
the consummation of any Qualified Securitization Transaction shall not be deemed
to be the Incurrence of Indebtedness by the Company or by any Subsidiary of the
Company.
SECTION 4.05. Limitation on Certain Asset Dispositions.
(a) The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, make one or more Asset
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Dispositions for aggregate consideration of, or in respect of assets having an
aggregate fair market value of, $5 million or more in any 12-month period,
unless: (i) the Company or the Subsidiary, as the case may be, receives
consideration for such Asset Disposition at least equal to the fair market value
of the assets sold or disposed of as determined by the Board of Directors of the
Company in good faith and evidenced by a resolution of such Board of Directors
filed with the Trustee; (ii) not less than 75% of the consideration for the
disposition consists of cash or readily marketable cash equivalents or the
assumption of Indebtedness (other than non-recourse Indebtedness or any
Indebtedness subordinated to the Securities) of the Company or such Subsidiary
or other obligations relating to such assets (and release of the Company or such
Subsidiary from all liability on the Indebtedness or other obligations assumed);
and (iii) all Net Available Proceeds, less any amounts invested within 360 days
of such Asset Disposition in assets related to the business of the Company
(including the Capital Stock of another Person (other than the Company or any
Person that is a Subsidiary of the Company immediately prior to such
investment); provided, however, that immediately after giving effect to any such
investment (and not prior thereto) such Person shall be a Subsidiary of the
Company (other than a Securitization Subsidiary)), are applied, on or prior to
the 360th day after such Asset Disposition, unless and to the extent that the
Company shall determine to make an Offer to Purchase, either to (A) the
permanent reduction and prepayment of any Senior Indebtedness then outstanding
(including a permanent reduction of commitments in respect thereof) or (B) the
permanent reduction and repayment of any Guarantor Senior Indebtedness then
outstanding of any Subsidiary of the Company (including a permanent reduction of
commitments in respect thereof). Any Net Available Proceeds from any Asset
Disposition that is subject to the immediately preceding sentence that are not
applied as provided in the immediately preceding sentence shall be used promptly
after the expiration of the 360th day after such Asset Disposition, or promptly
after the Company shall have earlier determined to not apply any Net Available
Proceeds therefrom as provided in subclauses (A) or (B) of clause (iii) of the
immediately preceding sentence, to make an Offer to Purchase outstanding
Securities at a purchase price in cash equal to 100% of their principal amount
plus accrued interest to the Purchase Date. Notwithstanding the foregoing, the
Company may defer making any Offer to Purchase outstanding Securities until
there are aggregate unutilized Net Available Proceeds from Asset Dispositions
otherwise subject to the two immediately preceding sentences equal to or in
excess of $5 million (at which time, the entire unutilized Net Available
Proceeds from Asset Dispositions otherwise subject to the two immediately
preceding sentences, and not just the amount in excess
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of $5 million, shall be applied as required pursuant to this
paragraph).
If any Indebtedness of the Company ranking pari passu with the
Securities requires that prepayment of, or an offer to prepay, such Indebtedness
be made with any Net Available Proceeds, the Company may apply such Net
Available Proceeds pro rata (based on the aggregate principal amount of the
Securities then outstanding and the aggregate principal amount (or accreted
value, if less) of all such other Indebtedness then outstanding) to the making
of an Offer to Purchase the Securities in accordance with the foregoing
provisions and the prepayment or the offer to prepay such pari passu
Indebtedness. The Company shall make a further Offer to Purchase Securities in
an amount equal to any such Net Available Proceeds not utilized to actually
prepay such other Indebtedness at a purchase price in cash equal to 100% of the
principal amount of the Securities plus accrued interest to the Purchase Date if
the amount not so utilized equals or exceeds $5 million.
Any remaining Net Available Proceeds following the completion
of the required Offer to Purchase may be used by the Company for any other
purpose (subject to the other provisions of this Indenture) and the amount of
Net Available Proceeds then required to be otherwise applied in accordance with
this Section shall be reset to zero, subject to any subsequent Asset
Disposition.
In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule
14e-1 under, the Exchange Act, and any violation of the provisions of this
Indenture relating to such Offer to Purchase occurring as a result of such
compliance shall not be deemed an Event of Default or a Default.
(b) The Company will mail the Offer for an Offer to
Purchase required pursuant to Section 4.05(a) not more than 365
days after consummation of the Asset Disposition resulting in the
Offer to Purchase; provided, however, that the Company may defer
making any Offer to Purchase outstanding Securities until there are
aggregate unutilized Net Available Proceeds from Asset Dispositions
otherwise subject to the first two sentences of Section 4.05(a)
equal to or in excess of $5 million (at which time, the entire
unutilized Net Available Proceeds from Asset Dispositions otherwise
subject to the first two sentences of Section 4.05(a), and not just
the amount in excess of $5 million, shall be applied as required
pursuant to the first paragraph of Section 4.05(a)). Each Holder
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shall be entitled to tender all or any portion of the Securities owned by such
Holder pursuant to the Offer to Purchase, subject to the requirement that any
portion of a Security tendered must be tendered in an integral multiple of
$1,000 principal amount and subject to any proration of the Offer among
tendering Holders if the aggregate amount of Securities tendered exceeds the Net
Available Proceeds.
(c) Not later than the date of the Offer with respect to an
Offer to Purchase pursuant to this Section 4.05, the Company shall deliver to
the Trustee an Officers' Certificate as to the Purchase Amount.
On or prior to the Purchase Date specified in the Offer to
Purchase, the Company shall (i) accept for payment (on a pro rata basis, if
necessary) Securities or portions thereof validly tendered pursuant to this
Offer, (ii) deposit with the Paying Agent (or, if the Company is acting as its
own Paying Agent, segregate and hold in trust as provided in Section 2.04) money
sufficient to pay the Purchase Price of all Securities or portions thereof so
accepted and (iii) deliver or cause to be delivered to the Trustee for
cancellation all Securities so accepted together with an Officers' Certificate
stating the Securities or portions thereof accepted for payment by the Company.
The Paying Agent (or the Company, if so acting) shall promptly mail or deliver
to Holders of Securities so accepted payment in an amount equal to the Purchase
Price for such Securities, and the Trustee shall promptly authenticate and mail
or deliver to each Holder a new Security or Securities equal in principal amount
to any unpurchased portion of the Security surrendered as requested by the
Holder. Any Security not accepted for payment shall be promptly mailed or
delivered by the Company to the Holder thereof. The Company shall publicly
announce the results of the Offer on or as soon as practicable after the
Purchase Date.
(d) Notwithstanding the foregoing, this Section 4.05
shall not apply to any Asset Disposition consummated in compliance
with the provisions of Section 5.01.
SECTION 4.06. Limitation on Restricted Payments.
The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, (i) declare or pay any dividend, or
make any distribution of any kind or character (whether in cash, property or
securities), in respect of any class of its Capital Stock or to the holders
thereof, excluding any (x) dividends or distributions payable solely in shares
of its Capital Stock (other than Disqualified Stock) or in options, warrants or
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other rights to acquire its Capital Stock (other than Disqualified Stock), or
(y) in the case of any Subsidiary of the Company, dividends or distributions
payable to the Company or a Subsidiary of the Company (other than a
Securitization Subsidiary), (ii) purchase, redeem, or otherwise acquire or
retire for value shares of Capital Stock of the Company or any of its
Subsidiaries, any options, warrants or rights to purchase or acquire shares of
Capital Stock of the Company or any of its Subsidiaries or any securities
convertible or exchangeable into shares of Capital Stock of the Company or any
of its Subsidiaries, excluding any such shares of Capital Stock, options,
warrants, rights or securities which are owned by the Company or a Subsidiary of
the Company (other than a Securitization Subsidiary), (iii) make any Investment
in (other than a Permitted Investment), or payment on a guarantee of any
obligation of, any Person, other than the Company or a Wholly Owned Subsidiary
of the Company, or (iv) redeem, defease, repurchase, retire or otherwise acquire
or retire for value, prior to any scheduled maturity, repayment or sinking fund
payment, Indebtedness which is subordinate in right of payment to the Securities
(each of the transactions described in clauses (i) through (iv) (other than any
exception to any such clause) being a "Restricted Payment") if at the time
thereof: (1) an Event of Default, or an event that with the passing of time or
giving of notice, or both, would constitute an Event of Default, shall have
occurred and be continuing, or (2) upon giving effect to such Restricted
Payment, the Company could not Incur at least $1.00 of additional Indebtedness
pursuant to clause (i) of Section 4.04, or (3) upon giving effect to such
Restricted Payment, the aggregate of all Restricted Payments made on or after
the Issue Date exceeds the sum of: (a) 50% of cumulative Consolidated Net Income
of the Company (or, in the case cumulative Consolidated Net Income of the
Company shall be negative, less 100% of such deficit) since the end of the
fiscal quarter in which the Issue Date occurs through the last day of the fiscal
quarter for which financial statements are available; plus (b) 100% of the
aggregate net proceeds received after the Issue Date, including the fair market
value of property other than cash (determined in good faith by the Board of
Directors of the Company as evidenced by a resolution of such Board of Directors
filed with the Trustee), from the issuance of Capital Stock (other than
Disqualified Stock) of the Company and warrants, rights or options on Capital
Stock (other than Disqualified Stock) of the Company (other than in respect of
any such issuance to a Subsidiary of the Company) and the principal amount of
Indebtedness of the Company or any of its Subsidiaries (other than a
Securitization Subsidiary) that has been converted into or exchanged for Capital
Stock of the Company which Indebtedness was Incurred after the Issue Date; plus
(c) in the case of the disposition or repayment of any Investment constituting a
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Restricted Payment made after the Issue Date, an amount equal to the lesser of
the return of capital with respect to such Investment and the cost of such
Investment, in either case, less the cost of the disposition of such Investment;
provided, however, that at the time any such Investment is made the Company
delivers to the Trustee a resolution of its Board of Directors to the effect
that, for purposes of this Section 4.06, such Investment constitutes a
Restricted Payment made after the Issue Date; plus (d) $4 million.
The foregoing provision will not be violated by (i) any
dividend on any class of Capital Stock of the Company or any Subsidiary of the
Company paid within 60 days after the declaration thereof if, on the date when
the dividend was declared, the Company or such Subsidiary, as the case may be,
could have paid such dividend in accordance with the provisions of this
Indenture, (ii) the renewal, extension, refunding or refinancing of any
Indebtedness otherwise permitted pursuant to clause (v) of Section 4.04, (iii)
the exchange or conversion of any Indebtedness of the Company or any Subsidiary
of the Company (other than a Securitization Subsidiary) for or into Capital
Stock of the Company (other than Disqualified Stock of the Company), (iv) any
payments, loans or other advances made pursuant to any employee benefit plans
(including plans for the benefit of directors) or employment agreements or other
compensation arrangements, in each case as approved by the Board of Directors of
the Company in its good faith judgment, (v) the redemption of the Company's
rights issued pursuant to the Amended and Restated Rights Agreement dated as of
May 10, 1994, between the Company and Wachovia Bank of North Carolina, N.A., as
Rights Agent, in an amount per right issued thereunder not to exceed that in
effect on the Issue Date, (vi) so long as no Default or Event of Default has
occurred and is continuing, any Investment made with the proceeds of a
substantially concurrent sale of Capital Stock of the Company (other than
Disqualified Stock); provided, however, that the proceeds of such sale of
Capital Stock shall not be (and have not been) included in subclause (b) of
clause (3) of the preceding paragraph, (vii) so long as no Default or Event of
Default has occurred and is continuing, additional Investments constituting
Restricted Payments in Persons or entities in the same line of business as the
Company as of the Issue Date in an aggregate outstanding amount (valued at the
cost thereof) not to exceed at any time $4 million, (viii) the redemption,
repurchase, retirement or other acquisition of any Capital Stock of the Company
in exchange for or out of the net cash proceeds of the substantially concurrent
sale (other than to a Subsidiary of the Company) of Capital Stock of the Company
(other than Disqualified Stock); provided, however, that the proceeds of such
sale of Capital Stock shall not be (and have not been) included in subclause (b)
of
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clause (3) of the preceding paragraph or (ix) so long as no Default or Event of
Default has occurred and is continuing, the payment of cash dividends on (A) the
Company's 4 1/2% Series B Cumulative Preferred Stock outstanding on the Issue
Date in accordance with the terms of the Articles of Incorporation of the
Company as in effect on the Issue Date and (B) the Company's Common Stock not to
exceed $1.5 million in any fiscal quarter of the Company plus 4.5 cents per
quarter per share of Common Stock of the Company issued on conversion of the
outstanding shares of the Company's 4 1/2% Series B Cumulative Preferred Stock
(which amount per share shall be adjusted periodically (including as adjusted)
upon any change after the Issue Date in the number of shares of Common Stock
issuable upon conversion of the 4 1/2% Series B Cumulative Preferred Stock by
multiplying the amount thereof by a fraction, the numerator of which shall
be the number of shares of Common Stock issuable upon conversion of one
share of the 4 1/2% Series B Cumulative Preferred Stock as of the Issue Date
and the denominator of which shall be the number of shares of Common Stock
issuable upon conversion of one share of the 4 1/2% Series B Cumulative
Preferred Stock as of such date of adjustment). Each Restricted Payment
described in clauses (i), (iii), (iv), (v), (vii) and (ix) of the previous
sentence shall be taken into account for purposes of computing the aggregate
amount of all Restricted Payments pursuant to clause (3) of the preceding
paragraph.
SECTION 4.07. Corporate Existence.
Subject to Article Five, the Company shall do or shall cause
to be done all things necessary to preserve and keep in full force and effect
its corporate existence and the corporate, partnership or other existence of
each of its Subsidiaries (other than a Securitization Subsidiary) in accordance
with the respective organizational documents of each such Subsidiary and the
rights (charter and statutory) and material franchises of the Company and its
Subsidiaries (other than a Securitization Subsidiary); provided, however, that
the Company shall not be required to preserve any such right or franchise, or
the corporate existence of any Subsidiary, if the Board of Directors of the
Company shall determine that the preservation thereof is no longer desirable in
the conduct of the business of the Company and its Subsidiaries, taken as a
whole, and that the loss thereof is not, and will not be, adverse in any
material respect to the Holders; provided, further, however, that a
determination of the Board of Directors of the Company shall not be required in
the event of a merger of one or more wholly-owned Subsidiaries of the Company
with or into another wholly-owned Subsidiary of the Company or another Person,
if the surviving Person is a wholly-owned Subsidiary of the Company (other than
a Securitization Subsidiary) organized under the laws
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of the United States or a State thereof or of the District of
Columbia.
SECTION 4.08. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all material taxes,
assessments and governmental charges levied or imposed upon the Company or any
Subsidiary of the Company or upon the income, profits or property of the Company
or any Subsidiary of the Company and (2) all lawful claims for labor, materials
and supplies which, in each case, if unpaid, might by law become a material
liability, or Lien upon the property, of the Company or any Subsidiary of the
Company; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate proceedings and for which appropriate provision has been made.
SECTION 4.09. Notice of Defaults.
(1) In the event that any Indebtedness of the Company or any
of its Subsidiaries is declared due and payable before its maturity because of
the occurrence of any default (or any event which, with notice or lapse of time,
or both, would constitute such a default) under such Indebtedness, the Company
shall promptly give written notice to the Trustee of such declaration, the
status of such default or event and what action the Company is taking or
proposes to take with respect thereto.
(2) Upon becoming aware of any Default or Event of Default,
the Company shall promptly deliver an Officers' Certificate to the Trustee
specifying the Default or Event of Default.
SECTION 4.10. Maintenance of Properties.
The Company shall cause all material properties owned by or
leased to it or any of its Subsidiaries and used or useful in the conduct of its
business or the business of any of its Subsidiaries to be maintained and kept in
normal condition, repair and working order and supplied with all necessary
equipment and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary, so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that
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nothing in this Section shall prevent the Company or any of its Subsidiaries
from discontinuing the use, operation or maintenance of any of such properties,
or disposing of any of them, if such discontinuance or disposal is, in the
judgment of the Board of Directors or of the board of directors of the
Subsidiary concerned, or of an officer (or other agent employed by the Company
or of any of its Subsidiaries) of the Company or such Subsidiary having
managerial responsibility for any such property, desirable in the conduct of the
business of the Company or any of its Subsidiaries, and if such discontinuance
or disposal is not adverse in any material respect to the Holders.
SECTION 4.11. Compliance Certificate.
The Company shall deliver to the Trustee within 55 days after
the end of each of the first three fiscal quarters of the Company and within 100
days after the close of each fiscal year a certificate signed by the principal
executive officer, principal financial officer or principal accounting officer
stating that a review of the activities of the Company has been made under the
supervision of the signing officers with a view to determining whether a Default
or Event of Default has occurred and whether or not the signers know of any
Default or Event of Default by the Company that occurred during such fiscal
quarter or fiscal year. If they do know of such a Default or Event of Default,
the certificate shall describe all such Defaults or Events of Default, their
status and the action the Company is taking or proposes to take with respect
thereto. The first certificate to be delivered by the Company pursuant to this
Section 4.11 shall be for the fiscal quarter ending September 30, 1996.
SECTION 4.12. Provision of Financial Information.
Whether or not the Company is subject to Section 13(a) or
15(d) of the Exchange Act, or any successor provision thereto, the Company will
file with the SEC the annual reports, quarterly reports and other documents
which the Company would have been required to file with the SEC pursuant to such
Section 13(a) or 15(d) or any successor provision thereto if the Company were so
required, such documents to be filed with the SEC on or prior to the respective
dates (the "Required Filing Dates") by which the Company would have been
required so to file such documents if the Company were so required. The Company
will also in any event (a) within 15 days of each Required Filing Date (i)
transmit by mail to all Holders, as their names and addresses appear in the
Security Register, without cost to such Holders, and (ii) file with the Trustee,
copies of the annual reports, quarterly reports and other documents which the
Company is required to file with the SEC
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pursuant to the preceding sentence, and (b) if, notwithstanding the preceding
sentence, the filing of such documents by the Company with the SEC is not
permitted under the Exchange Act, promptly upon written request supply copies of
such documents to any prospective Holder. The Company will also comply with ss.
314(a) of the TIA.
SECTION 4.13. Waiver of Stay, Extension or Usury Laws.
The Company and each Guarantor covenants (to the extent that
it may lawfully do so) that it shall not at any time insist upon, plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law, which would prohibit or forgive the
Company or such Guarantor from paying all or any portion of the principal of
and/or interest on the Securities as contemplated herein, wherever enacted, now
or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may lawfully do so)
the Company and each Guarantor hereby expressly waives all benefit or advantage
of any such law, and covenants that it shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
SECTION 4.14. Change of Control.
(a) The Company shall, within 30 days following the date of
the consummation of a transaction resulting in a Change of Control, mail an
Offer with respect to an Offer to Purchase all outstanding Securities at a
purchase price in cash equal to 101% of their aggregate principal amount plus
accrued interest to the Purchase Date. Each Holder shall be entitled to tender
all or any portion of the Securities owned by such Holder pursuant to the Offer
to Purchase, subject to the requirement that any portion of a Security tendered
must be tendered in an integral multiple of $1,000 principal amount.
(b) On or prior to the Purchase Date specified in the Offer to
Purchase, the Company shall (i) accept for payment all Securities or portions
thereof validly tendered pursuant to the Offer, (ii) deposit with the Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 2.04) money sufficient to pay the Purchase Price
of all Securities or portions thereof so accepted and (iii) deliver or cause to
be delivered to the Trustee for cancellation all Securities so accepted together
with an Officers' Certificate stating the Securities or portions thereof
accepted for payment by the Company. The Paying Agent (or the Company, if so
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acting) shall promptly mail or deliver to Holders of Securities so accepted
payment in an amount equal to the Purchase Price for such Securities, and the
Trustee shall promptly authenticate and mail or deliver to each Holder a new
Security or Securities equal in principal amount to any unpurchased portion of
the Security surrendered as requested by the Holder. Any Security not accept for
payment shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Offer on or as
soon as practicable after the Purchase Date.
(c) A "Change of Control" will be deemed to have occurred in
the event that (whether or not otherwise permitted by this Indenture) after the
Issue Date (a) any Person or any Persons acting together that would constitute a
group (for purposes of Section 13(d) of the Exchange Act, or any successor
provision thereto) (a "Group"), together with any Affiliates or Related Persons
thereof, shall "beneficially own" (as defined in Rule 13d-3 under the Exchange
Act, or any successor provision thereto) at least 35% of the voting power of the
outstanding Voting Stock of the Company; (b) any sale, lease or other transfer
(in one transaction or a series of related transactions) is made by the Company
or any of its Subsidiaries of all or substantially all of the consolidated
assets of the Company to any Person (other than a Wholly Owned Subsidiary of the
Company which is a Guarantor (other than a Securitization Subsidiary)); (c)
Continuing Directors cease to constitute at least a majority of the Board of
Directors of the Company; or (d) the stockholders of the Company approve any
plan or proposal for the liquidation or dissolution of the Company.
In the event that the Company makes an Offer to Purchase the
Securities, the Company shall comply with any applicable securities laws and
regulations, including any applicable requirements of Section 14(e) of, and Rule
14e-1 under, the Exchange Act and any violation of the provisions of this
Indenture relating to such Offer to Purchase occurring as a result of such
compliance shall not be deemed a Default or an Event of Default.
SECTION 4.15. Limitation on Senior Subordinated Indebtedness.
The Company shall not (i) directly or indirectly Incur any
Indebtedness that by its terms would expressly rank senior in right of payment
to the Securities and expressly rank subordinate in right of payment to any
Senior Indebtedness and (ii) permit any Guarantor to and no Guarantor will
directly or indirectly Incur any Indebtedness that by its terms would expressly
rank senior in right of payment to the Guarantee of such Guarantor and expressly
rank subordinate in right of payment to any Guarantor Senior Indebtedness.
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SECTION 4.16. Limitations Concerning Distributions
and Transfers by Subsidiaries.
The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist any consensual encumbrance or restriction on the ability of any Subsidiary
of the Company to (i) pay, directly or indirectly, dividends or make any other
distributions in respect of its Capital Stock or pay any Indebtedness or other
obligation owed to the Company or any Subsidiary of the Company, (ii) make loans
or advances to the Company or any Subsidiary of the Company or guarantee any
Indebtedness of the Company or any of its Subsidiaries or (iii) transfer any of
its property or assets to the Company or any Subsidiary of the Company, except
for such encumbrances or restrictions existing under or by reason of (a) any
agreement in effect on the Issue Date (including pursuant to the Senior Credit
Facility and agreements entered into in connection therewith) as any such
agreement is in effect on such date, (b) any agreement relating to any
Indebtedness Incurred by such Subsidiary prior to the date on which such
Subsidiary was acquired by the Company and outstanding on such date and not
Incurred in anticipation or contemplation of becoming a Subsidiary and provided
such encumbrance or restriction shall not apply to any assets of the Company or
its Subsidiaries other than such Subsidiary, (c) customary provisions contained
in an agreement which has been entered into for the sale or disposition of all
or substantially all of the Capital Stock or assets of such Subsidiary;
provided, however, that such encumbrance or restriction is applicable only to
such Subsidiary or assets, (d) an agreement effecting a renewal, exchange,
refunding, amendment or extension of Indebtedness Incurred pursuant to an
agreement referred to in clause (a) or (b) above; provided, however, that the
provisions contained in such renewal, exchange, refunding, amendment or
extension agreement relating to such encumbrance or restriction are no more
restrictive in any material respect than the provisions contained in the
agreement that is the subject thereof in the reasonable judgment of the Board of
Directors of the Company as evidenced by a resolution of such Board of Directors
filed with the Trustee, (e) this Indenture, (f) applicable law, (g) customary
provisions restricting subletting or assignment of any lease governing any
leasehold interest of any Subsidiary of the Company, (h) Indebtedness or any
other contractual requirements (including pursuant to any corporate governance
documents in the nature of a charter or by-laws) of a Securitization Subsidiary
arising in connection with a Qualified Securitization Transaction; provided,
however, that any such
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encumbrance or restriction applies only to such Securitization Subsidiary, (i)
purchase money obligations for property acquired in the ordinary course of
business that impose restrictions of the type referred to in clause (iii) of
this Section 4.16 or (j) restrictions of the type referred to in clause (iii) of
this Section 4.16 contained in security agreements securing Indebtedness of a
Subsidiary of the Company to the extent that such Liens were otherwise incurred
in accordance with Section 4.18 and restrict the transfer of property subject to
such agreements.
SECTION 4.17. Limitation on Issuance and Sale
of Capital Stock of Subsidiaries.
The Company (a) will not, and will not permit any Subsidiary
of the Company to, transfer, convey, sell or otherwise dispose of any shares of
Capital Stock of such Subsidiary or any other Subsidiary (other than to the
Company or a Wholly Owned Subsidiary of the Company (other than a Securitization
Subsidiary)), except that the Company and any Subsidiary may, in any single
transaction, sell all, but not less than all, of the issued and outstanding
Capital Stock of any Subsidiary to any Person, subject to complying with the
provisions of Section 4.05 and (b) will not permit any Subsidiary of the Company
to issue shares of its Capital Stock (other than directors' qualifying shares),
or securities convertible into, or warrants, rights or options to subscribe for
or purchase shares of, its Capital Stock to any Person other than to the Company
or a Wholly Owned Subsidiary of the Company (other than a Securitization
Subsidiary).
SECTION 4.18. Limitation on Liens.
The Company will not, and will not permit any of its
Subsidiaries to, Incur any Lien on or with respect to any property or assets of
the Company or any Subsidiary of the Company owned on the Issue Date or
thereafter acquired or on the income or profits thereof to secure Indebtedness
without making, or causing such Subsidiary to make, effective provision for
securing the Securities (and, if the Company shall so determine, any other
Indebtedness of the Company or such Subsidiary, including Indebtedness which is
subordinate in right of payment to the Securities; provided, however, that Liens
securing the Securities and any Indebtedness pari passu with the Securities are
senior to such Liens securing such subordinated Indebtedness) equally and
ratably with such Indebtedness or, in the event such Indebtedness is subordinate
in right of payment to the Securities or the Guarantees, prior to such
Indebtedness, as to such property or assets for so long as such Indebtedness
shall be so secured. The foregoing restrictions shall not apply to (i) Liens
securing Senior Indebtedness of the Company
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or Guarantor Senior Indebtedness; (ii) Liens securing only the Securities; (iii)
Liens in favor of the Company; (iv) Liens to secure Indebtedness Incurred for
the purpose of financing all or any part of the purchase price or the cost of
construction or improvement of the property subject to such Liens; provided,
however, that (a) the aggregate principal amount of any Indebtedness secured by
such a Lien does not exceed 100% of such purchase price or cost, (b) such Lien
does not extend to or cover any other property other than such item of property
and any improvements on such item, (c) the Indebtedness secured by such Lien is
Incurred by the Company or its Subsidiary within 180 days of the acquisition,
construction or improvement of such property and (d) the Incurrence of such
Indebtedness is permitted by Section 4.04; (v) Liens on property existing
immediately prior to the time of acquisition thereof (and not created in
anticipation or contemplation of the financing of such acquisition); (vi) Liens
on property of a Person existing at the time such Person is merged with or into
or consolidated with the Company or any Subsidiary of the Company (and not
created in anticipation or contemplation thereof); (vii) Liens on property of
the Company or any Subsidiary of the Company in favor of the United States of
America, any state thereof, or any instrumentality of either to secure payments
pursuant to any contract or statute; (viii) Liens granted in connection with any
Qualified Securitization Transaction; (ix) Liens existing on the Issue Date
securing Indebtedness existing on the Issue Date; (x) Liens to secure
Indebtedness Incurred to extend, renew, refinance or refund (or successive
extensions, renewals, refinancings or refundings), in whole or in part, any
Indebtedness secured by Liens referred to in the foregoing clauses (i)-(ix) so
long as such Liens do not extend to any other property and the principal amount
of Indebtedness so secured is not increased except for the amount of any premium
required to be paid in connection with such renewal, refinancing or refunding
pursuant to the terms of the Indebtedness renewed, refinanced or refunded or the
amount of any premium reasonably determined by the Company as necessary to
accomplish such renewal, refinancing or refunding by means of a tender offer,
exchange offer or privately negotiated repurchase, plus the expenses of the
Company or such Subsidiary incurred in connection with such renewal, refinancing
or refunding; and (xi) Liens in favor of the Trustee as provided for in Section
7.07.
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ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Restriction on Mergers, Consolidations
and Certain Sales of Assets.
Neither the Company nor any Subsidiary will consolidate or
merge with or into any Person, and the Company will not, and will not permit any
of its Subsidiaries to, sell, assign, lease, convey or otherwise dispose of all
or substantially all of the Company's consolidated assets (as an entirety or
substantially an entirety in one transaction or a series of related
transactions, including by way of liquidation or dissolution) to, any Person
unless, in each such case: (i) the entity formed by or surviving any such
consolidation or merger (if other than the Company or such Subsidiary, as the
case may be), or to which such sale, assignment, lease, conveyance or other
disposition shall have been made (the "Surviving Entity"), is a corporation
organized and existing under the laws of the United States, any state thereof or
the District of Columbia; (ii) the Surviving Entity assumes by supplemental
indenture all of the obligations of the Company or such Subsidiary, as the case
may be, on the Securities or such Subsidiary's Guarantee, as the case may be,
and under this Indenture; (iii) immediately after giving effect to such
transaction and the use of any net proceeds therefrom on a pro forma basis, the
Consolidated Net Worth of the Company or the Surviving Entity (in the case of
any transaction involving the Company), as the case may be, would be at least
equal to the Consolidated Net Worth of the Company immediately prior to such
transaction; (iv) immediately after giving effect to such transaction and the
use of any net proceeds therefrom on a pro forma basis, the Company or the
Surviving Entity (in the case of any transaction involving the Company), as the
case may be, could Incur at least $1.00 of Indebtedness pursuant to clause (i)
of Section 4.04; (v) immediately before and after giving effect to such
transaction and treating any Indebtedness which becomes an obligation of the
Company or any of its Subsidiaries as a result of such transaction as having
been incurred by the Company or such Subsidiary, as the case may be, at the time
of the transaction, no Event of Default or event that with the passing of time
or the giving of notice, or both, would constitute an Event of Default shall
have occurred and be continuing; and (vi) if, as a result of any such
transaction, property or assets of the Company or a Subsidiary would become
subject to a Lien not excepted from the provisions of Section 4.18, the Company,
any such Subsidiary or the Surviving Entity, as the case may be, shall have
secured the Securities as required by said Section 4.18. The provisions of this
Section 5.01 shall not apply to any merger of a Subsidiary of
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the Company with or into the Company or a Wholly Owned Subsidiary of the Company
(other than a Securitization Subsidiary) or any transaction pursuant to which a
Guarantor's Guarantee is to be released in accordance with the terms of the
Guarantee and this Indenture in connection with any transaction complying with
the provisions of Section 4.05.
SECTION 5.02. Successor Corporation Substituted.
Upon any consolidation of the Company or any Subsidiary of the
Company with, or merger of the Company or any such Subsidiary into, any other
Person or any sale, assignment, lease, conveyance or other disposition of all or
substantially all of the Company's consolidated assets (as an entirety or
substantially as an entirety in one transaction or a series of related
transactions, including by way of liquidation or dissolution) in accordance with
Section 5.01, upon the execution of a supplemental indenture by the Surviving
Person in form and substance satisfactory to the Trustee (as evidenced by the
Trustee's execution thereof), the Surviving Person shall succeed to, and be
substituted for, and may exercise every right and power of and shall assume all
obligations of, the Company or such Subsidiary, as the case may be, under this
Indenture and the Securities or the Guarantees, as the case may be, with the
same effect as if such Surviving Person had been named as the Company or such
Subsidiary, as the case may be, herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities or the Guarantees, as the case may be.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company fails to pay interest on any Securities when
the same becomes due and payable and the Default continues for a period
of 30 days, whether or not such payment is prohibited by Article Eight
hereof;
(2) the Company fails to pay the principal of any Securities
when the same becomes due and payable at maturity, upon redemption,
upon repurchase pursuant to an Offer to Purchase or otherwise, whether
or not such payment is prohibited by Article Eight hereof;
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(3) the Company fails to perform or comply with any of
the provisions of Section 5.01;
(4) the Company fails to observe or perform any other
covenant, warranty or agreement contained in the Securities or this
Indenture, and the Default continues for the period and after the
notice specified in the last paragraph of this Section 6.01;
(5) a default or defaults under the terms of one or more
instruments evidencing or securing Indebtedness of the Company or any
Subsidiary of the Company having an outstanding principal amount of $10
million or more individually or in the aggregate that has resulted in
the acceleration of the payment of such Indebtedness or the Company or
any of its Subsidiaries fails to pay principal when due at the stated
maturity of any such Indebtedness;
(6) there shall have been any final judgment or judgments (not
subject to appeal) against the Company or any Subsidiary of the Company
in an amount of $5 million or more (net of any amounts covered by
reputable and creditworthy insurance companies) which remains
undischarged or unstayed for a period of 60 days after the date on
which the right to appeal has expired;
(7) the Company or any Material Subsidiary pursuant to
or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding,
(B) consents to the entry of an order for relief
against it in an involuntary case or proceeding,
(C) consents to the appointment of a Custodian of
it or for all or substantially all of its property, or
(D) makes a general assignment for the benefit of
its creditors;
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Material Subsidiary in an involuntary case or proceeding,
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(B) appoints a Custodian of the Company or any
Material Subsidiary or for all or substantially all of
its property, or
(C) orders the liquidation of the Company or any
Material Subsidiary,
and in each case the order or decree remains unstayed and in effect for
60 days; provided, however, that if the entry of such order or decree
is appealed and dismissed on appeal then the Event of Default hereunder
by reason of the entry of such order or decree shall be deemed to have
been cured; or
(9) the Guarantee of any Guarantor which is a Material
Subsidiary ceases to be in full force and effect (other than in
accordance with the terms of such Guarantee and this Indenture) or is
declared null and void and unenforceable or found to be invalid or any
Guarantor which is a Material Subsidiary denies its liability under its
Guarantee (other than by reason of a release of such Guarantor from its
Guarantee in accordance with the terms of such Guarantee and this
Indenture).
The term "Bankruptcy Law" means Title 11, U.S. Code or any
similar Federal, state or foreign law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, sequestrator or
similar official under any Bankruptcy Law.
A Default under clause (4) is not an Event of Default until
the Trustee notifies the Company, or the Holders of at least 25% in principal
amount of the outstanding Securities notify the Company and the Trustee, of the
Default in writing and the Company does not cure the Default within 30 days
after receipt of the notice. The notice must specify the Default, demand that it
be remedied and state that the notice is a "Notice of Default." Such notice
shall be given by the Trustee if so requested by the Holders of at least 25% in
principal amount of the Securities then outstanding. When a Default is cured, it
ceases.
SECTION 6.02. Acceleration.
If an Event of Default with respect to the Securities (other
than an Event of Default specified in clause (7) or (8) of Section 6.01 with
respect to the Company) occurs and is continuing, the Trustee or the Holders of
at least 25% in aggregate principal amount of the outstanding Securities by
notice in writing to the Company (and to the Trustee if given by the Holders)
may declare
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the unpaid principal of and accrued interest to the date of acceleration on all
the outstanding Securities to be due and payable immediately and, upon any such
declaration, such principal amount and accrued interest shall become immediately
due and payable.
If an Event of Default specified in clause (7) or (8) of
Section 6.01 with respect to the Company occurs all unpaid principal of and
accrued interest on the outstanding Securities shall ipso facto become
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder thereof.
After a declaration of acceleration, but before a judgment or
decree of the money due in respect of the Notes has been obtained, the Holders
of not less than a majority in aggregate principal amount of the Securities then
outstanding by written notice to the Trustee may rescind an acceleration and its
consequences if all existing Events of Default (other than the nonpayment of
principal of and interest on the Securities which has become due solely by
virtue of such acceleration) have been cured or waived and if the rescission
would not conflict with any judgment or decree. No such rescission shall affect
any subsequent Default or impair any right consequent thereto.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Securities or does not produce any of them in the proceeding.
A delay or omission by the Trustee or any Securityholder in exercising any right
or remedy maturing upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Default.
Subject to Sections 2.09, 6.07 and 10.02, prior to the
declaration of acceleration of the Securities, the Holders of not less than a
majority in aggregate principal amount of the outstanding Securities by written
notice to the Trustee may waive
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an existing Default or Event of Default and its consequences, except a Default
in the payment of principal of or interest on any Security as specified in
clauses (1) and (2) of Section 6.01 or a Default in respect of any term or
provision of this Indenture that may not be amended or modified without the
consent of each Holder affected as provided in Section 10.02. The Company shall
deliver to the Trustee an Officers' Certificate stating that the requisite
percentage of Holders have consented to such waiver and attaching copies of such
consents. In case of any such waiver, the Company, the Trustee and the Holders
shall be restored to their former positions and rights hereunder and under the
Securities, respectively. This paragraph of this Section 6.04 shall be in lieu
of ss. 316(a)(1)(B) of the TIA and such ss. 316(a)(1)(B) of the TIA is hereby
expressly excluded from this Indenture and the Securities, as permitted by the
TIA.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred, and any Event of Default
arising therefrom shall be deemed to have been cured and not to have occurred
for every purpose of this Indenture and the Securities, but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereon.
SECTION 6.05. Control by Majority.
Subject to Section 2.09, the Holders of a majority in
principal amount of the outstanding Securities may direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on it. However, the Trustee may refuse
to follow any direction that conflicts with law or this Indenture, that the
Trustee determines may be unduly prejudicial to the rights of another
Securityholder, or that may involve the Trustee in personal liability; provided,
however, that the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction. In the event the Trustee takes
any action or follows any direction pursuant to this Indenture, the Trustee
shall be entitled to indemnification satisfactory to it in its sole discretion
against any loss or expense caused by taking such action or following such
direction. This Section 6.05 shall be in lieu of ss. 316(a)(1)(A) of the TIA,
and such ss. 316(a)(1)(A) of the TIA is hereby expressly excluded from this
Indenture and the Securities, as permitted by the TIA.
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SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to
this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 25% in aggregate principal
amount of the outstanding Securities make a written request to
the Trustee to pursue a remedy;
(3) such Holder or Holders offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(4) the Trustee does not comply with the request within
60 days after receipt of the request and the offer and, if
requested, the provision of indemnity; and
(5) during such 60-day period the Holders of a majority in
principal amount of the outstanding Securities (excluding Affiliates of
the Company) do not give the Trustee a direction which, in the opinion
of the Trustee, is inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over such
other Securityholder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal of and interest on the
Security, on or after the respective due dates expressed in the Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of interest or principal
specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or any other obligor on the Securities for the whole amount of principal
and accrued interest remaining unpaid, together with interest overdue on
principal and to the extent that payment of such interest is
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lawful, interest on overdue installments of interest, in each case at the rate
per annum borne by the Securities and such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relative to the Company (or
any other obligor upon the Securities), its creditors or its property and shall
be entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same, and any
Custodian in any such judicial proceedings is hereby authorized by each
Securityholder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agent and
counsel, and any other amounts due the Trustee under Section 7.07. Nothing
herein contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Securityholder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this
Article Six, it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under
Section 7.07;
Second: to Holders for amounts due and unpaid on the
Securities for principal and interest, ratably, without
preference or priority of any kind, according to the amounts
due and payable on the Securities for principal and interest,
respectively; and
Third: to the Company.
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The Trustee, upon prior written notice to the Company, may fix
a record date and payment date for any payment to Securityholders pursuant to
this Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by
a Holder or group of Holders of more than 10% in aggregate principal amount of
the outstanding Securities, or to any suit instituted by any Holder for the
enforcement or the payment of the principal or interest on any Securities on or
after the respective due dates expressed in the Security.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a 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 man would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of a Default:
(1) The Trustee shall not be liable except for the
performance of such duties as are specifically set forth
herein; and
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions conforming to the requirements of this Indenture; however, the
Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
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(c) The Trustee shall not be relieved from liability for
its own negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(1) This paragraph does not limit the effect of
paragraph (b) of this Section 7.01;
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or to take or omit to take any
action under this Indenture or take any action at the request or direction of
Holders if it shall have reasonable grounds for believing that repayment of such
funds is not assured to it or it does not receive an indemnity satisfactory to
it in its sole discretion against such risk, liability, loss, fee or expense
which might be incurred by it in compliance with such request or direction.
(e) Every provision of this Indenture that in any way
relates to the Trustee is subject to paragraphs (a), (b), (c) and
(d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely on any document believed by it to be
genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it
may require an Officers' Certificate and an Opinion of
Counsel, which shall conform to the provisions of Section
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13.05. The Trustee shall not be liable for any action it takes or omits
to take in good faith in reliance on such certificate or opinion.
(c) The Trustee may act through attorneys and agents of its
selection and shall not be responsible for the misconduct or negligence
of any agent or attorney (other than an agent who is an employee of the
Trustee) appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it reasonably believes to be
authorized or within its rights or powers.
(e) The Trustee may consult with counsel and the advice or
opinion of such counsel as to matters of law shall be full and complete
authorization and protection from liability in respect of any action
taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(f) Any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
and any resolution of the Board of Directors may be sufficiently
evidenced by a Board Resolution.
(g) 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 Securityholders pursuant to this Indenture,
unless such Securithyholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction.
(h) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or
attorney.
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SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company or
its Affiliates with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. However, the Trustee is subject to
Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the
Securities, it shall not be accountable for the Company's use of the proceeds
from the Securities, and it shall not be responsible for any statement of the
Company in this Indenture or any document issued in connection with the sale of
Securities or any statement in the Securities other than the Trustee's
certificate of authentication.
SECTION 7.05. Notice of Defaults.
If a Default or an Event of Default occurs and is continuing
and the Trustee knows of such Defaults or Events of Default, the Trustee shall
mail to each Securityholder notice of the Default or Event of Default within 30
days after the occurrence thereof. Except in the case of a Default or an Event
of Default in payment of principal of or interest on any Security or a Default
or Event of Default in complying with Section 5.01, the Trustee may withhold the
notice if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interest of Securityholders.
This Section 7.05 shall be in lieu of the proviso to ss. 315(b) of the TIA and
such proviso to ss. 315(b) of the TIA is hereby expressly excluded from this
Indenture and the Securities, as permitted by the TIA.
SECTION 7.06. Reports by Trustee to Holders.
If required by TIA ss. 313(a), within 60 days after each June
15 beginning with the June 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a report dated as of such June 15 that
complies with TIA ss. 313(a). The Trustee also shall comply with TIA ss. 313(b),
(c) and (d).
A copy of each such report at the time of its mailing to
Securityholders shall be filed with the SEC and each stock exchange, if any, on
which the Securities are listed.
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The Company shall promptly notify the Trustee in writing if
the Securities become listed on any stock exchange or of any delisting thereof.
SECTION 7.07. Compensation and Indemnity.
The Company shall 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 its services. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances (including fees, disbursements and expenses of its agents and
counsel) incurred or made by it in addition to the compensation for its services
except any such disbursements, expenses and advances as may be attributable to
the Trustee's negligence or bad faith. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents,
accountants, experts and counsel and any taxes or other expenses incurred by a
trust created pursuant to Section 9.01 hereof.
The Company shall indemnify the Trustee for, and hold it
harmless against any and all loss, damage, claims, liability or expense,
including taxes (other than franchise taxes imposed on the Trustee and taxes
based upon, measured by or determined by the income of the Trustee), arising out
of or in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder, except to the extent that such loss, damage, claim,
liability or expense is due to its own negligence or bad faith. The Trustee
shall notify the Company promptly of any claim asserted against the Trustee for
which it may seek indemnity. However, the failure by the Trustee to so notify
the Company shall not relieve the Company of its obligations hereunder. The
Company shall defend the claim and the Trustee shall cooperate in the defense
(and may employ its own counsel) at the Company's expense; provided, however,
that the Company's reimbursement obligation with respect to counsel employed by
the Trustee will be limited to the reasonable fees of such counsel. The Company
need not pay for any settlement made without its written consent, which consent
shall not be unreasonably withheld. The Company need not reimburse any expense
or indemnify against any loss or liability incurred by the Trustee as a result
of the violation of this Indenture by the Trustee.
To secure the Company's payment obligations in this Section
7.07, the Trustee shall have a Lien prior to the Securities
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against all money or property held or collected by the Trustee, in its capacity
as Trustee, except money or property held in trust to pay principal of or
interest on particular Securities.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 6.01(7) or (8) occurs, the expenses
(including the reasonable fees and expenses of its agents and counsel) and the
compensation for the services shall be preferred over the status of the Holders
in a proceeding under any Bankruptcy Law and are intended to constitute expenses
of administration under any Bankruptcy Law. The Company's obligations under this
Section 7.07 and any claim arising hereunder shall survive the resignation or
removal of any Trustee, the discharge of the Company's obligations pursuant to
Article Eight and any rejection or termination under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company
in writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Trustee and the Company in
writing and may appoint a successor Trustee with the Company's consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent
under any Bankruptcy Law;
(3) a custodian or other public officer takes charge of
the Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the Securities may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. As promptly as
practicable after that, the retiring Trustee shall transfer, after payment of
all sums then owing to the Trustee
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pursuant to Section 7.07, all property held by it as Trustee to the successor
Trustee, subject to the Lien provided in Section 7.07, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Securityholder.
If a successor Trustee does not take office within 60 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of at least 10% in principal amount of the outstanding
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company's obligations under Section 7.07 shall continue for
the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation or banking corporation, the resulting, surviving or transferee
corporation or banking corporation without any further act shall be the
successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee which shall be
eligible to act as Trustee under TIA ss.ss. 310(a)(1) and 310(a)(2). The Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition. If the Trustee has or
shall acquire any "conflicting interest" within the meaning of TIA ss. 310(b),
the Trustee and the Company shall comply with the provisions of TIA ss. 310(b).
If at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect hereinbefore specified in this Article Seven.
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SECTION 7.11. Preferential Collection of Claims
Against Company.
The Trustee shall comply with TIA ss. 311(a), excluding any
creditor relationship listed in TIA ss. 311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior Indebtedness.
The Company covenants and agrees, and the Trustee and each
Holder of the Securities by his acceptance thereof likewise covenant and agree,
that all Securities shall be issued subject to the provisions of this Article;
and each person holding any Security, whether upon original issue or upon
transfer, assignment or exchange thereof, accepts and agrees that all payments
of the principal of and interest on the Securities by the Company shall, to the
extent and in the manner set forth in this Article, be subordinated and junior
in right of payment to the prior payment in full of all amounts payable under
Senior Indebtedness.
SECTION 8.02. No Payment on Securities in
Certain Circumstances.
(a) No direct or indirect payment by or on behalf of the
Company of principal of or interest on the Securities, whether pursuant to the
terms of the Securities, upon acceleration or otherwise, shall be made if, at
the time of such payment, there exists a default in the payment of all or any
portion of the obligations on any Designated Senior Indebtedness, whether at
maturity, on account of mandatory redemption or prepayment, acceleration or
otherwise (and the Trustee has received written notice thereof), and such
default shall not have been cured or waived or the benefits of this sentence
waived by or on behalf of the holders of such Designated Senior Indebtedness. In
addition, during the continuance of any non-payment default or non-payment event
of default with respect to any Designated Senior Indebtedness pursuant to which
the maturity thereof may be accelerated, and upon receipt by the Trustee of
written notice (a "Payment Blockage Notice") from the holder or holders of such
Designated Senior Indebtedness or the trustee or agent acting on behalf of such
Designated Senior Indebtedness, then, unless and until such default or event of
default has been cured or waived or has ceased to exist or such Designated
Senior Indebtedness has been discharged or
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repaid in full, no direct or indirect payment shall be made by or on behalf of
the Company of principal of or interest on the Securities, except from those
funds held in trust for the benefit of the Holders of any Securities to such
Holders, during a period (a "Payment Blockage Period") commencing on the date of
receipt of such notice by the Trustee and ending 179 days thereafter.
Notwithstanding anything herein or in the Securities to the
contrary, (x) in no event shall a Payment Blockage Period extend beyond 179 days
from the date the Payment Blockage Notice in respect thereof was given and (y)
in no event shall a Payment Blockage Notice be effective for purposes of this
Section 8.02(a) unless and until 360 days shall have elapsed since the
effectiveness of the immediately prior Payment Blockage Notice. Not more than
one Payment Blockage Period may be commenced with respect to the Securities
during any period of 360 consecutive days. No default or event of default that
existed or was continuing on the date of commencement of any Payment Blockage
Period with respect to the Designated Senior Indebtedness initiating such
Payment Blockage Period may be, or be made, the basis for the commencement of
any other Payment Blockage Period by the holder or holders of such Designated
Senior Indebtedness or the trustee or agent acting on behalf of such Designated
Senior Indebtedness, whether or not within a period of 360 consecutive days,
unless such default or event of default has been cured or waived for a period of
not less than 90 consecutive days.
(b) In the event that, notwithstanding the foregoing, any
payment shall be received by the Trustee or any Holder when such payment is
prohibited by Section 8.02(a), such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Designated
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Designated Senior
Indebtedness may have been issued, as their respective interests may appear, but
only to the extent that, upon notice from the Trustee to the holders of
Designated Senior Indebtedness that such prohibited payment has been made, the
holders of the Designated Senior Indebtedness (or their representative or
representatives or a trustee) notify the Trustee in writing of the amounts then
due and owing on the Designated Senior Indebtedness, if any, and only the
amounts specified in such notice to the Trustee shall be paid to the holders of
Designated Senior Indebtedness.
SECTION 8.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any payment or distribution of assets or
securities of the Company of any kind or character, whether in
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cash, property or securities, upon any dissolution or winding-up or total or
partial liquidation or reorganization of the Company, whether voluntary or
involuntary or in bankruptcy, insolvency, receivership or other proceedings, all
amounts due or to become due with respect to Senior Indebtedness shall first be
paid in full before the Holders of the Securities or the Trustee on behalf of
such Holders shall be entitled to receive any payment by the Company of the
principal of or interest on the Securities, or any payment to acquire any of the
Securities for cash, property or securities, or any distribution with respect to
the Securities of any cash, property or securities. Before any payment may be
made by, or on behalf of, the Company of the principal of or interest on the
Securities upon any such dissolution or winding-up or liquidation or
reorganization, any payment or distribution of assets or securities of the
Company of any kind or character, whether in cash, property or securities, to
which the Holders of the Securities or the Trustee on their behalf would be
entitled, but for the subordination provisions of this Indenture, shall be made
by the Company or by any receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person making such payment or distribution, directly to the
holders of the Senior Indebtedness (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders) or their
representatives or to the trustee or trustees under any indenture pursuant to
which any of such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all such Senior
Indebtedness in full after giving effect to any concurrent payment, distribution
or provision therefor to or for the holders of such Senior Indebtedness.
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of the Company of any kind or character, whether in cash, property
or securities, shall be received by the Trustee or any Holder of Securities at a
time when such payment or distribution is prohibited by Section 8.03(a) and
before all obligations in respect of Senior Indebtedness are paid in full, or
payment provided for, such payment or distribution shall be received and held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
Senior Indebtedness (pro rata to such holders on the basis of the respective
amounts of Senior Indebtedness held by such holders) or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Senior Indebtedness may have been issued, as their respective
interests may appear, for application to the payment of Senior Indebtedness
remaining unpaid until all such Senior Indebtedness has been paid in full after
giving effect
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to any concurrent payment, distribution or provision therefor to or
for the holders of such Senior Indebtedness.
(c) For purposes of this Section, the words "cash, property or
securities" shall not be deemed to include, so long as the effect of these
clauses (x) and (y) is not to cause the Securities to be treated in any case or
proceeding or similar event described in this Section as part of the same class
of claims as the Senior Indebtedness or any class of claims on a parity with or
senior to the Senior Indebtedness for any payment or distribution, (x) any
payment or distribution of securities of the Company or any other corporation
authorized by an order or decree giving effect, and stating in such order or
decree that effect is given, to the subordination of the Securities to the
Senior Indebtedness, and made by a court of competent jurisdiction in a
reorganization proceeding under any applicable bankruptcy, insolvency or other
similar law, or (y) securities of the Company or any other corporation provided
for by a plan of reorganization or readjustment which are subordinated, to at
least the same extent as the Securities, to the payment of all Senior
Indebtedness then outstanding (the securities described in clauses (x) and (y)
being hereinafter referred to as "Subordinated Reorganization Securities");
provided, however, that (i) if a new corporation results from such
reorganization or readjustment, such corporation assumes the Senior Indebtedness
and (ii) the rights of the holders of the Senior Indebtedness are not, without
the consent of such holders, altered by such reorganization or readjustment.
The consolidation of the Company with, or the merger of the
Company with or into, another corporation or the liquidation or dissolution of
the Company following the conveyance or transfer of its property as an entirety,
or substantially as an entirety, to another corporation upon the terms and
conditions provided in Article Five shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section if
such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article Five.
SECTION 8.04. Subrogation.
Upon the payment in full of all Senior Indebtedness, or
provision for payment, the Holders of the Securities shall be subrogated to the
rights of the holders of Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Company made on such Senior
Indebtedness until the principal of and interest on the Securities shall be paid
in full; and, for the purposes of such subrogation, no payments or distributions
to
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the holders of the Senior Indebtedness of any cash, property or securities to
which the Holders of the Securities or the Trustee on their behalf would be
entitled except for the provisions of this Article, and no payment over pursuant
to the provisions of this Article to the holders of Senior Indebtedness by
Holders of the Securities or the Trustee on their behalf shall, as between the
Company, its creditors other than holders of Senior Indebtedness, and the
Holders of the Securities, be deemed to be a payment by the Company to or on
account of the Senior Indebtedness. It is understood that the provisions of this
Article are and are intended solely for the purpose of defining the relative
rights of the Holders of the Securities, on the one hand, and the holders of the
Senior Indebtedness, on the other hand.
If any payment or distribution to which the Holders of the
Securities would otherwise have been entitled but for the provisions of this
Article shall have been applied, pursuant to the provisions of this Article, to
the payment of all amounts payable under Senior Indebtedness, then and in such
case, the Holders of the Securities shall be entitled to receive from the
holders of such Senior Indebtedness any payments or distributions received by
such holders of Senior Indebtedness in excess of the amount required to make
payment in full, or provision for payment, of such Senior Indebtedness.
SECTION 8.05. Obligations of Company Unconditional.
Nothing contained in this Article or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as among the
Company and the Holders of the Securities, the obligation of the Company, which
is absolute and unconditional, to pay to the Holders of the Securities the
principal of and interest on the Securities as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the Holders of the Securities and creditors of the
Company other than the holders of the Senior Indebtedness, nor shall anything
herein or therein prevent the Holder of any Security or the Trustee on their
behalf from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
of the holders of the Senior Indebtedness in respect of cash, property or
securities of the Company received upon the exercise of any such remedy.
Without limiting the generality of the foregoing, nothing
contained in this Article shall restrict the right of the Trustee or the Holders
of Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity
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pursuant to Section 6.01 or to pursue any rights or remedies hereunder;
provided, however, that all Senior Indebtedness then due and payable shall first
be paid in full before the Holders of the Securities or the Trustee are entitled
to receive any direct or indirect payment from the Company of principal of or
interest on the Securities.
SECTION 8.06. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of
any fact known to the Company which would prohibit the making of any payment to
or by the Trustee in respect of the Securities pursuant to the provisions of
this Article. The Trustee shall not be charged with knowledge of the existence
of any default or event of default with respect to any Senior Indebtedness or of
any other facts which would prohibit the making of any payment to or by the
Trustee unless and until the Trustee shall have received notice in writing at
its Corporate Trust Office to that effect signed by an Officer of the Company,
or by a holder of Senior Indebtedness or trustee or agent therefor; and prior to
the receipt of any such written notice, the Trustee shall, subject to Article
Seven, be entitled to assume that no such facts exist; provided that if the
Trustee shall not have received the notice provided for in this Section at least
two Business Days prior to the date upon which by the terms of this Indenture
any moneys shall become payable for any purpose (including, without limitation,
the payment of the principal of or interest on any Security), then, regardless
of anything herein to the contrary, the Trustee shall have full power and
authority to receive any moneys from the Company and to apply the same to the
purpose for which they were received, and shall not be affected by any notice to
the contrary which may be received by it on or after such prior date. Nothing
contained in this Section 8.06 shall limit the right of the holders of Senior
Indebtedness to recover payments as contemplated by Section 8.03. The Trustee
shall be entitled to rely on the delivery to it of a written notice by a Person
representing himself or itself to be a holder of any Senior Indebtedness (or a
trustee on behalf of, or other representative of, such holder) to establish that
such notice has been given by a holder of such Senior Indebtedness or a trustee
or representative on behalf of any such holder.
In the event that the Trustee determines in good faith that
any evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to
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participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article, and if such evidence is not furnished,
the Trustee may defer any payment to such Person pending judicial determination
as to the right of such Person to receive such payment.
SECTION 8.07. Reliance on Judicial Order or
Certificate of Liquidating Agent.
Upon any payment or distribution of assets or securities
referred to in this Article, the Trustee and the Holders of the Securities shall
be entitled to rely upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding-up, liquidation or
reorganization proceedings are pending, or upon a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Securities for the purpose of ascertaining the persons entitled to participate
in such distribution, the holders of the Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article.
SECTION 8.08. Trustee's Relation to Senior Indebtedness.
The Trustee and any Paying Agent shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness which
may at any time be held by it in its individual or any other capacity to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee or any Paying Agent of any of its rights as
such holder.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior Indebtedness (except
as provided in Section 8.03(b)).
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SECTION 8.09. Subordination Rights Not Impaired
by Acts or Omissions of the Company
or Holders of Senior Indebtedness.
No right of any present or future holders of any Senior
Indebtedness to enforce subordination as provided herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with. The provisions of this Article are intended to be for the
benefit of, and shall be enforceable directly by, the holders of Senior
Indebtedness.
SECTION 8.10. Securityholders Authorize Trustee To
Effectuate Subordination of Securities.
Each Holder of Securities by his acceptance of such Securities
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article, and appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
creditors or otherwise) tending towards liquidation of the business and assets
of the Company, the filing of a claim for the unpaid balance of its or his
Securities in the form required in those proceedings.
SECTION 8.11. This Article Not To Prevent Events of Default.
The failure to make a payment on account of principal of or
interest on the Securities by reason of any provision of this Article shall not
be construed as preventing the occurrence of an Event of Default specified in
clause (1) or (2) of Section 6.01.
SECTION 8.12. Trustee's Compensation Not Prejudiced.
Nothing in this Article shall apply to amounts due to the
Trustee pursuant to other sections in this Indenture.
SECTION 8.13. No Waiver of Subordination Provisions.
Without in any way limiting the generality of Section 8.09,
the holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the
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Trustee or the Holders of the Securities, without incurring responsibility to
the Holders of the Securities and without impairing or releasing the
subordination provided in this Article or the obligations hereunder of the
Holders of the Securities to the holders of Senior Indebtedness, do any one or
more of the following: (a) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior Indebtedness or any
instrument evidencing the same or any agreement under which Senior Indebtedness
is outstanding or secured; (b) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing Senior Indebtedness; (c)
release any Person liable in any manner for the collection of Senior
Indebtedness and (d) exercise or refrain from exercising any rights against the
Company and any other Person.
SECTION 8.14. Subordination Provisions Not Applicable
to Money Held in Trust for Securityholders;
Payments May Be Paid Prior to Dissolution.
All money and United States Government Obligations deposited
in trust with the Trustee pursuant to and in accordance with Article Nine shall
be for the sole benefit of the Holders and shall not be subject to this Article
Eight.
Nothing contained in this Article or elsewhere in this
Indenture shall prevent (i) the Company, except under the conditions described
in Section 8.02, from making payments of principal of and interest on the
Securities, or from depositing with the Trustee any moneys for such payments or
from effecting a termination of the Company's and the Guarantors' obligations
under the Securities and the Indenture as provided in Article Nine, or (ii) the
application by the Trustee of any moneys deposited with it for the purpose of
making such payments of principal of and interest on the Securities, to the
holders entitled thereto unless at least two Business Days prior to the date
upon which such payment becomes due and payable, the Trustee shall have received
the written notice provided for in Section 8.02(b) or in Section 8.06. The
Company shall give prompt written notice to the Trustee of any dissolution,
winding-up, liquidation or reorganization of the Company.
SECTION 8.15. Acceleration of Securities.
If payment of the Securities is accelerated because of an
Event of Default, the Company shall promptly notify holders of the Senior
Indebtedness of the acceleration.
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ARTICLE NINE
DISCHARGE OF INDENTURE
SECTION 9.01. Termination of Company's Obligations.
Subject to the provisions of Article Eight, the Company may
terminate its and the Guarantors' substantive obligations in respect of the
Securities by delivering all outstanding Securities to the Trustee for
cancellation and paying all sums payable by it on account of principal of and
interest on all Securities or otherwise. In addition to the foregoing, the
Company may, provided that no Default or Event of Default has occurred and is
continuing or would arise therefrom (or, with respect to a Default or Event of
Default specified in Section 6.01(7) or (8), any time on or prior to the 95th
calendar day after the date of such deposit (it being understood that this
condition shall not be deemed satisfied until after such 95th day)) and provided
that no default under any Senior Indebtedness would result therefrom, terminate
its and the Guarantors' substantive obligations in respect of the Securities
(except for its obligations to pay the principal of and interest on the
Securities and the Guarantors' guarantee thereof) by (i) depositing with the
Trustee, under the terms of an irrevocable trust agreement, money or direct
non-callable obligations of the United States of America for the payment of
which the full faith and credit of the United States is pledged ("United States
Government Obligations") sufficient (without reinvestment) to pay all remaining
indebtedness on the Securities, (ii) delivering to the Trustee either an Opinion
of Counsel or a ruling directed to the Trustee from the Internal Revenue Service
to the effect that the Holders of the Securities will not recognize income, gain
or loss for federal income tax purposes as a result of such deposit and
termination of obligations, (iii) delivering to the Trustee an Opinion of
Counsel to the effect that the Company's exercise of its option under this
paragraph will not result in any of the Company, the Trustee or the trust
created by the Company's deposit of funds pursuant to this provision becoming or
being deemed to be an "investment company" under the Investment Company Act of
1940, as amended, and (iv) delivering to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating compliance with all conditions precedent
provided for herein. In addition, subject to the provisions of Article Eight
with respect to the creation of the defeasance trust provided for in the
following clause (i), the Company may, provided that no Default or Event of
Default has occurred and is continuing or would arise therefrom (or, with
respect to a Default or Event of Default specified in Section 6.01(7) or (8),
any time on or prior to the 95th calendar day after the date of such deposit (it
being understood that this condition
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shall not be deemed satisfied until after such 95th day)) and provided that no
default under any Senior Indebtedness would arise therefrom, terminate all of
its and the Guarantors' substantive obligations in respect of the Securities
(including its obligations to pay the principal of and interest on the
Securities and the Guarantors' guarantee thereof) by (i) depositing with the
Trustee, under the terms of an irrevocable trust agreement, money or United
States Government Obligations sufficient (without reinvestment) to pay all
remaining indebtedness on the Securities, (ii) delivering to the Trustee either
a ruling directed to the Trustee from the Internal Revenue Service to the effect
that the Holders of the Securities will not recognize income, gain or loss for
federal income tax purposes as a result of such deposit and termination of
obligations or an Opinion of Counsel based upon such a ruling addressed to the
Trustee or a change in the applicable Federal tax law since the date of this
Indenture to such effect, (iii) delivering to the Trustee an Opinion of Counsel
to the effect that the Company's exercise of its option under this paragraph
will not result in any of the Company, the Trustee or the trust created by the
Company's deposit of funds pursuant to this provision becoming or being deemed
to be an "investment company" under the Investment Company Act of 1940, as
amended, and (iv) delivering to the Trustee an Officers' Certificate and an
Opinion of Counsel each stating compliance with all conditions precedent
provided for herein.
Notwithstanding the foregoing paragraph, the Company's
obligations in Sections 2.03, 2.05, 2.06, 2.07, 4.01 (but not with respect to
termination of substantive obligations pursuant to the third sentence of the
foregoing paragraph), 4.02, 7.07, 7.08, 9.03 and 9.04 shall survive until the
Securities are no longer outstanding. Thereafter the Company's obligations in
Sections 7.07, 9.03 and 9.04 shall survive.
After such delivery or irrevocable deposit and delivery of an
Officers' Certificate and Opinion of Counsel, the Trustee upon request shall
acknowledge in writing the discharge of the Company's and the Guarantors'
obligations under the Securities and this Indenture except for those surviving
obligations specified above.
SECTION 9.02. Application of Trust Money.
The Trustee shall hold in trust money or United States
Government Obligations deposited with it pursuant to Section 9.01, and shall
apply the deposited money and the money from United States Government
Obligations in accordance with this Indenture
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solely to the payment of principal of and interest on the
Securities.
SECTION 9.03. Repayment to Company.
Subject to Sections 7.07 and 9.01, the Trustee shall promptly
pay to the Company upon written request any excess money held by it at any time.
The Trustee shall pay to the Company upon written request any money held by it
for the payment of principal or interest that remains unclaimed for two years;
provided, however, that the Trustee before being required to make any payment
may at the expense of the Company cause to be published once in a newspaper of
general circulation in The City of New York or mail to each Holder entitled to
such money notice that such money remains unclaimed and that, after a date
specified therein which shall be at least 30 days from the date of such
publication or mailing, any unclaimed balance of such money then remaining shall
be repaid to the Company. After payment to the Company, Securityholders entitled
to money must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another person and all liability of
the Trustee or Paying Agent with respect to such money shall thereupon cease.
SECTION 9.04. Reinstatement.
If the Trustee is unable to apply any money or United States
Government Obligations in accordance with Section 9.01 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and the Guarantors' obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 9.01 until such time as the Trustee is permitted to apply
all such money or United States Government Obligations in accordance with
Section 9.01; provided, however, that if the Company has made any payment of
interest on or principal of any Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the money or United States
Government Obligations held by the Trustee.
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ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders.
The Company and the Guarantors, when authorized by a
resolution of their respective Boards of Directors, and the Trustee may amend or
supplement this Indenture or the Securities without notice to or consent of any
Securityholder:
(i) to cure any ambiguity, defect or inconsistency;
provided, however, that such amendment or supplement does not adversely
affect the rights of any Holder;
(ii) to effect the assumption by a successor Person of all
obligations of the Company under the Securities and this Indenture in
connection with any transaction complying with Article Five of this
Indenture;
(iii) to provide for uncertificated Securities in addition
to or in place of certificated Securities;
(iv) to comply with any requirements of the SEC in order
to effect or maintain the qualification of this Indenture
under the TIA;
(v) to make any change that would provide any additional
benefit or rights to the Holders;
(vi) to make any other change that does not adversely
affect the rights of any Holder under this Indenture;
(vii) to evidence the succession of another Person to any
Guarantor and the assumption by any such successor of the covenants of
such Guarantor herein and in the Guarantee;
(viii) to add to the covenants of the Company or the Guarantors
for the benefit of the Holders, or to surrender any right or power
herein conferred upon the Company or any Guarantor;
(ix) to secure the Securities pursuant to the
requirements of Section 4.18 or otherwise; or
(x) to reflect the release of a Guarantor from its
obligations with respect to its Guarantee in accordance with
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the provisions of Section 11.03 and to add a Guarantor
pursuant to the requirements of Section 11.07;
provided, however, that the Company has delivered to the Trustee an Opinion of
Counsel stating that such amendment or supplement complies with the provisions
of this Section 10.01.
SECTION 10.02. With Consent of Holders.
Subject to Section 6.07, the Company and the Guarantors, when
authorized by a resolution of their respective Boards of Directors, and the
Trustee may amend or supplement this Indenture or the Securities with the
written consent of the Holders of at least a majority in principal amount of the
outstanding Securities. Subject to Section 6.07, the Holders of a majority in
principal amount of the outstanding Securities may waive compliance by the
Company or any Guarantor with any provision of this Indenture or the Securities.
However, without the consent of each Securityholder affected, an amendment,
supplement or waiver, including a waiver pursuant to Section 6.04, may not:
(1) change the Stated Maturity of the principal of or any
installment of interest on any Security or alter the optional
redemption or repurchase provisions of any Security or this Indenture
in a manner adverse to the holders of the Securities;
(2) reduce the principal amount of any Security;
(3) reduce the rate or extend the time for payment of
interest on any Security;
(4) change the place or currency of payment of the
principal of or interest on any Security;
(5) modify any provisions of Section 6.04 (other than to add
sections of this Indenture or the Securities subject thereto) or 6.07
or this Section 10.02 (other than to add sections of this Indenture or
the Securities which may not be amended, supplemented or waived without
the consent of each Securityholder affected);
(6) reduce the percentage of the principal amount of
outstanding Securities necessary for amendment to or waiver of
compliance with any provision of this Indenture or the Securities or
for waiver of any Default;
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(7) waive a default in the payment of the principal of,
interest on, or redemption payment with respect to, any Security
(except a recission of acceleration of the Securities by the Holders as
provided in Section 6.02 and a waiver of the payment of default that
resulted from such acceleration);
(8) modify the ranking or priority of the Securities or the
Guarantee of any Guarantor which is a Material Subsidiary, or modify
the definition of Senior Indebtedness or Guarantor Senior Indebtedness,
or amend or modify any of the provisions of Article Eight or Article
Twelve in any manner adverse to the Holders;
(9) release any Guarantor which is a Material Subsidiary from
any of its obligations under its Guarantee or this Indenture otherwise
than in accordance with this Indenture; or
(10) modify the provisions relating to any Offer to Purchase
required pursuant to Section 4.05 or 4.14 in a manner materially
adverse to the Holders.
An amendment under this Section 10.02 may not make any change
under Article Eight, Article Nine, Article Eleven or Article Twelve hereof that
adversely affects in any material respect the rights of any holder of Senior
Indebtedness then outstanding unless the holders of such Senior Indebtedness (or
any representative thereof authorized to give a consent) shall have consented to
such change.
It shall not be necessary for the consent of the Holders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
SECTION 10.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
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SECTION 10.04. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to
it by a Holder is a continuing consent by the Holder and every subsequent Holder
of that Security or portion of that Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security. Subject to the following paragraph, any such Holder or subsequent
Holder may revoke the consent as to such Holder's Security or portion of such
Security by notice to the Trustee or the Company received before the date on
which the Trustee receives an Officers' Certificate certifying that the Holders
of the requisite principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then,
notwithstanding the last sentence of the immediately preceding paragraph, those
persons who were Holders at such record date (or their duly designated proxies),
and only those persons, shall be entitled to consent to such amendment,
supplement or waiver or to revoke any consent previously given, whether or not
such persons continue to be Holders after such record date. No such consent
shall be valid or effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it
shall bind every Securityholder, unless it makes a change described in any of
clauses (1) through (10) of Section 10.02. In that case the amendment,
supplement or waiver shall bind each Holder of a Security who has consented to
it and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holder's Security.
SECTION 10.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a
Security, the Trustee may require the Holder of the Security to deliver it to
the Trustee. The Trustee may place an appropriate notation on the Security about
the changed terms and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the Security shall issue
and the Trustee shall authenticate a new Security that reflects the changed
terms. Failure to make the appropriate notation or issue a new Security shall
not affect the validity and effect of such amendment, supplement or waiver.
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SECTION 10.06. Trustee To Sign Amendments, etc.
The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
any amendment, supplement or waiver authorized pursuant to this Article Ten is
authorized or permitted by this Indenture and that such amendment, supplement or
waiver constitutes the legal, valid and binding obligation of the Company and
the Guarantors, enforceable in accordance with its terms (subject to customary
exceptions). The Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise. In signing any amendment,
supplement or waiver, the Trustee shall be entitled to receive an indemnity
reasonably satisfactory to it.
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee.
Each Guarantor hereby unconditionally, jointly and severally,
guarantees to each Holder of a Security authenticated and delivered by the
Trustee and to the Trustee and its successors and assigns that: the principal of
and interest on the Securities will be promptly paid in full when due, subject
to any applicable grace period, whether at maturity, by acceleration or
otherwise, and interest on the overdue principal and interest on any overdue
interest on the Securities and all other obligations of the Company to the
Holders or the Trustee hereunder or under the Securities will be promptly paid
in full or performed, all in accordance with the terms hereof and thereof;
subject, however, to the limitations set forth in Section 11.04. Each Guarantor
hereby agrees that its obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Securities or
this Indenture, the absence of any action to enforce the same, any waiver or
consent by any Holder of the Securities with respect to any provisions hereof or
thereof, the recovery of any judgment against the Company, any action to enforce
the same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor. Each Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands whatsoever
and covenants that the Guarantee will not be discharged except by complete
performance of the obligations contained in the Securities, this Indenture, and
this
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Guarantee. If any Holder or the Trustee is required by any court or otherwise to
return to the Company, any Guarantor, or any custodian, trustee, liquidator or
other similar official acting in relation to the Company or any Guarantor, any
amount paid by the Company or any Guarantor to the Trustee or such Holder, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Guarantor further agrees that, as between each Guarantor,
on the one hand, and the Holders and the Trustee, on the other hand, (x) the
maturity of the obligations guaranteed hereby may be accelerated as provided in
Article Six for the purpose of this Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any acceleration of such
obligations as provided in Article Six, such obligations (whether or not due and
payable) shall forth become due and payable by each Guarantor for the purpose of
this Guarantee.
SECTION 11.02. Severability.
In case any provision of this Guarantee shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 11.03. Release of a Guarantor.
If the Securities are defeased in accordance with the terms of
this Indenture, or if all or substantially all of the assets of any Guarantor or
all of the Capital Stock of any Guarantor is sold (including by issuance or
otherwise) by the Company or any of its Subsidiaries in a transaction
constituting an Asset Disposition and if (x) the Net Available Proceeds from
such Asset Disposition are used in accordance with Section 4.05 or (y) the
Company delivers to the Trustee an Officers' Certificate covenanting that the
Net Available Proceeds from such Asset Disposition shall be used in accordance
with Section 4.05 and within the time limits specified by such Section 4.05,
then such Guarantor (in the event of a sale or other disposition of all of the
Capital Stock of such Guarantor) or the corporation acquiring such assets (in
the event of a sale or other disposition of all or substantially all of the
assets of such Guarantor), shall be deemed released from all obligations under
this Article Eleven without any further action required on the part of the
Trustee or any Holder. The Trustee shall, at the sole cost and expense of the
Company and upon receipt at the reasonable request of the Trustee of an Opinion
of Counsel that the provisions of this Section 11.03 have been complied with,
deliver an appropriate instrument evidencing such
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release upon receipt of a request by the Company accompanied by an Officers'
Certificate certifying as to the compliance with this Section. Any Guarantor not
so released remains liable for the full amount of principal of and interest on
the Securities and the other obligations of the Company hereunder as provided in
this Article Eleven.
SECTION 11.04. Limitation of Guarantor's Liability.
Each Guarantor, and by its acceptance hereof each Holder and
the Trustee, hereby confirms that it is the intention of all such parties that
the guarantee by such Guarantor pursuant to its Guarantee not constitute a
fraudulent transfer or conveyance for purposes of title 11 of the United States
Code, as amended, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar U.S. Federal or state or other applicable law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under the Guarantee
shall be limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or
pursuant to Section 11.05, result in the obligations of such Guarantor under the
Guarantee not constituting such fraudulent transfer or conveyance.
SECTION 11.05. Contribution.
In order to provide for just and equitable contribution among
the Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under the
Guarantee, such Funding Guarantor shall be entitled to a contribution from all
other Guarantors in a pro rata amount, based on the net assets of each Guarantor
(including the Funding Guarantor), determined in accordance with GAAP, subject
to Section 11.04, for all payments, damages and expenses incurred by that
Funding Guarantor in discharging the Company's obligations with respect to the
Securities or any other Guarantor's obligations with respect to the Guarantee.
SECTION 11.06. Execution of Guarantee.
To further evidence their Guarantee to the Holders, the
Guarantors hereby agree to execute the Guarantee in substantially the form set
forth in Exhibit A hereto to be endorsed on each Security ordered to be
authenticated and delivered by the Trustee. Each Guarantor hereby agrees that
its Guarantee set forth in
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Section 11.01 shall remain in full force and effect notwithstanding any failure
to endorse on each Security a notation of such Guarantee. Each such Guarantee
shall be signed on behalf of each Guarantor by its Chairman of the Board, its
President or one of its Vice Presidents prior to the authentication of the
Security on which it is endorsed, and the delivery of such Security by the
Trustee, after the authentication thereof hereunder, shall constitute due
delivery of such Guarantee on behalf of such Guarantor. Such signature upon the
Guarantee may be manual or facsimile signature of such officer and may be
imprinted or otherwise reproduced on the Guarantee, and in case such officer who
shall have signed the Guarantee shall cease to be such officer before the
Security on which such Guarantee is endorsed shall have been authenticated and
delivered by the Trustee or disposed of by the Company, such Security
nevertheless may be authenticated and delivered or disposed of as though the
Person who signed the Guarantee had not ceased to be such officer of the
Guarantor.
SECTION 11.07. Additional Guarantors.
The Company shall cause each Material Subsidiary (other than
any Securitization Subsidiary), whether formed or acquired after the Issue Date,
to execute and deliver to the Trustee, promptly upon any such formation or
acquisition (a) a supplemental indenture in form and substance satisfactory to
the Trustee which subjects such Material Subsidiary to the provisions of this
Indenture as a Guarantor, and (b) an Opinion of Counsel to the effect that such
supplemental indenture has been duly authorized and executed by such Material
Subsidiary and constitutes the legal, valid, binding and enforceable obligation
of such Material Subsidiary (subject to such customary exceptions concerning
fraudulent conveyance laws, creditors' rights and equitable principles as may be
acceptable to the Trustee in its discretion); provided, however, that any
Material Subsidiary acquired after the Issue Date which is prohibited from
entering into a Guarantee pursuant to restrictions contained in any debt
instrument or other agreement in existence at the time such Material Subsidiary
was so acquired and not entered into in anticipation or contemplation of such
acquisition shall not be required to comply with the foregoing provisions of
this Section so long as any such restriction is in existence and to the extent
of any such restriction.
SECTION 11.08. Subordination of Subrogation and Other Rights.
Each Guarantor hereby agrees that any claim against the
Company that arises from the payment, performance or enforcement of such
Guarantor's obligations under its Guarantee or this Indenture, including,
without limitation, any right of subrogation, shall be
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subject and subordinate to, and no payment with respect to any such claim of
such Guarantor shall be made before, the payment in full in cash of all
outstanding Securities in accordance with the provisions provided therefor in
this Indenture.
ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated
to Guarantor Senior Debt.
Each Guarantor covenants and agrees, and the Trustee and each
Holder of the Securities by his acceptance thereof likewise covenant and agree,
that the Guarantees shall be issued subject to the provisions of this Article;
and each person holding any Security, whether upon original issue or upon
transfer, assignment or exchange thereof, accepts and agrees that all payments
of the principal of and interest on the Securities pursuant to the Guarantee
made by or on behalf of any Guarantor shall, to the extent and in the manner set
forth in this Article, be subordinated and junior in right of payment to the
prior payment in full of all amounts payable under Guarantor Senior Indebtedness
of such Guarantor.
SECTION 12.02. No Payment on Guarantees in
Certain Circumstances.
(a) No direct or indirect payment by or on behalf of any
Guarantor of principal of or interest on the Securities pursuant to such
Guarantor's Guarantee, whether pursuant to the terms of the Securities, upon
acceleration or otherwise, shall be made if, at the time of such payment, there
exists a default in the payment of all or any portion of the obligations on any
Designated Guarantor Senior Indebtedness of such Guarantor (and the Trustee has
received written notice thereof), and such default shall not have been cured or
waived or the benefits of this sentence waived by or on behalf of the holders of
such Designated Guarantor Senior Indebtedness. In addition, during the
continuance of any non-payment default or event of default with respect to any
Designated Guarantor Senior Indebtedness pursuant to which the maturity thereof
may be accelerated, and upon receipt by the Trustee of written notice (the
"Guarantor Payment Blockage Notice") from the holder or holders of such
Designated Guarantor Senior Indebtedness or the trustee or agent acting on
behalf of such Designated Guarantor Senior Indebtedness, then, unless and until
such default or event of default has been cured or waived or has ceased to exist
or such Designated Guarantor Senior Indebtedness has been discharged or
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paid in full, no direct or indirect payment shall be made by or on behalf of
such Guarantor of principal or interest on the Securities, except from those
funds held in trust for the benefit of the Holders of any Securities to such
Holders, during a period (a "Guarantor Blockage Period") commencing on the date
of receipt of such notice by the Trustee and ending 179 days thereafter.
Notwithstanding anything herein or in the Securities to the
contrary, (x) in no event shall a Guarantor Blockage Period extend beyond 179
days from the date the Guarantor Payment Blockage Notice was given and (y) in no
event shall a Guarantor Blockage Notice be effective for purposes of this
Section 12.02(a) unless and until 360 days shall have elapsed since the
effectiveness of the immediately prior Guarantor Payment Blockage Notice. Not
more than one Guarantor Blockage Period may be commenced with respect to any
Guarantor during any period of 360 consecutive days. No default or event of
default that existed or was continuing on the date of commencement of any other
Guarantor Blockage Period with respect to the Designated Guarantor Senior
Indebtedness initiating such Guarantor Payment Blockage Period may be, or be
made, the basis for the commencement of any other Guarantor Blockage Period by
the holder or holders of such Designated Guarantor Senior Indebtedness or the
trustee or agent acting on behalf of such Designated Guarantor Senior
Indebtedness, whether or not within a period of 360 consecutive days, unless
such default or event of default has been cured or waived for a period of not
less than 90 consecutive days.
(b) In the event that, notwithstanding the foregoing, any
payment shall be received by the Trustee or any Holder when such payment is
prohibited by Section 12.02(a), such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of such
Designated Guarantor Senior Indebtedness or their respective representatives, or
to the trustee or trustees under any indenture pursuant to which any of such
Designated Guarantor Senior Indebtedness may have been issued, as their
respective interests may appear, but only to the extent that, upon notice from
the Trustee to the holders of such Designated Guarantor Senior Indebtedness that
such prohibited payment has been made, the holders of such Designated Guarantor
Senior Indebtedness (or their representative or representatives or a trustee)
notify the Trustee in writing of the amounts then due and owing on such
Designated Guarantor Senior Indebtedness, if any, and only the amounts specified
in such notice to the Trustee shall be paid to the holders of such Designated
Guarantor Senior Indebtedness.
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SECTION 12.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any payment or distribution of assets or securities
of any Guarantor of any kind or character, whether in cash, property or
securities, upon any dissolution or winding-up or total or partial liquidation
or reorganization of such Guarantor, whether voluntary or involuntary or in
bankruptcy, insolvency, receivership or other proceedings, all amounts due or to
become due with respect to all Guarantor Senior Indebtedness of such Guarantor
shall first be paid in full before the Holders of the Securities or the Trustee
on behalf of such Holders shall be entitled to receive any payment by such
Guarantor of the principal of or interest on the Securities pursuant to such
Guarantor's Guarantee, or any payment to acquire any of the Securities for cash,
property or securities, or any distribution with respect to the Securities of
any cash, property or securities. Before any payment may be made by, or on
behalf of, any Guarantor of the principal of or interest on the Securities upon
any such dissolution or winding-up or liquidation or reorganization, any payment
or distribution of assets or securities of such Guarantor of any kind or
character, whether in cash, property or securities, to which the Holders of the
Securities or the Trustee on their behalf would be entitled, but for the
subordination provisions of this Indenture, shall be made by such Guarantor or
by any receiver, trustee in bankruptcy, liquidating trustee, agent or other
Person making such payment or distribution, directly to the holders of the
Guarantor Senior Indebtedness of such Guarantor (pro rata to such holders on the
basis of the respective amounts of such Guarantor Senior Indebtedness held by
such holders) or their representatives or to the trustee or trustees under any
indenture pursuant to which any of such Guarantor Senior Indebtedness may have
been issued, as their respective interests may appear, to the extent necessary
to pay all such Guarantor Senior Indebtedness in full after giving effect to any
concurrent payment, distribution or provision therefor to or for the holders of
such Guarantor Senior Indebtedness.
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of any Guarantor of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or any Holder of
Securities at a time when such payment or distribution is prohibited by Section
12.03(a) and before all obligations in respect of the Guarantor Senior
Indebtedness of such Guarantor are paid in full, or payment provided for, such
payment or distribution shall be received and held in trust for the benefit of,
and shall be paid over or delivered to, the holders of such Guarantor Senior
Indebtedness
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(pro rata to such holders on the basis of the respective amounts of such
Guarantor Senior Indebtedness held by such holders) or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Guarantor Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the payment of such
Guarantor Senior Indebtedness remaining unpaid until all such Guarantor Senior
Indebtedness has been paid in full after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders of such
Guarantor Senior Indebtedness.
(c) For purposes of this Section, the words "cash, property or
securities" shall not be deemed to include, so long as the effect of these
clauses (x) and (y) is not to cause the Guarantee of any Guarantor to be treated
in any case or proceeding or similar event described in this Section as part of
the same class of claims as Guarantor Senior Indebtedness of such Guarantor or
any class of claims on a parity with or senior to Guarantor Senior Indebtedness
of such Guarantor for any payment or distribution, (x) any payment or
distribution of securities of any Guarantor or any other corporation authorized
by an order or decree giving effect, and stating in such order or decree that
effect is given, to the subordination of the Guarantee to the Guarantor Senior
Indebtedness of such Guarantor, and made by a court of competent jurisdiction in
a reorganization proceeding under any applicable bankruptcy, insolvency or other
similar law, or (y) securities of any Guarantor or any other corporation
provided for by a plan of reorganization or readjustment which are subordinated,
to at least the same extent as the Guarantee, to the payment of all Guarantor
Senior Indebtedness of such Guarantor then outstanding; provided, however, that
(i) if a new corporation results from such reorganization or readjustment, such
corporation assumes the Guarantor Senior Indebtedness of such Guarantor and (ii)
the rights of the holders of the Guarantor Senior Indebtedness of such Guarantor
are not, without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of any Guarantor with, or the merger of any
Guarantor with or into, another corporation or the liquidation or dissolution of
any Guarantor following the conveyance or transfer of its property as an
entirety, or substantially as an entirety, to another corporation upon the terms
and conditions provided in Article Five shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section if
such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article Five.
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SECTION 12.04. Subrogation.
Upon the payment in full of all Guarantor Senior Indebtedness
of a Guarantor, or provision for payment, the Holders of the Securities shall be
subrogated to the rights of the holders of such Guarantor Senior Indebtedness to
receive payments or distributions of cash, property or securities of such
Guarantor made on such Guarantor Senior Indebtedness until the principal of and
interest on the Securities shall be paid in full; and, for the purposes of such
subrogation, no payments or distributions to the holders of such Guarantor
Senior Indebtedness of any cash, property or securities to which the Holders of
the Securities or the Trustee on their behalf would be entitled except for the
provisions of this Article, and no payment over pursuant to the provisions of
this Article to the holders of such Guarantor Senior Indebtedness by Holders of
the Securities or the Trustee on their behalf shall, as between such Guarantor,
its creditors other than holders of such Guarantor Senior Indebtedness, and the
Holders of the Securities, be deemed to be a payment by such Guarantor to or on
account of such Guarantor Senior Indebtedness. It is understood that the
provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities, on the one hand,
and the holders of Guarantor Senior Indebtedness of each Guarantor, on the other
hand.
If any payment or distribution to which the Holders of the
Securities would otherwise have been entitled but for the provisions of this
Article shall have been applied, pursuant to the provisions of this Article, to
the payment of all amounts payable under Guarantor Senior Indebtedness, then and
in such case, the Holders of the Securities shall be entitled to receive from
the holders of such Guarantor Senior Indebtedness any payments or distributions
received by such holders of Guarantor Senior Indebtedness in excess of the
amount required to make payment in full, or provision for payment, of such
Guarantor Senior Indebtedness.
SECTION 12.05. Obligations of Guarantors Unconditional.
Nothing contained in this Article or elsewhere in this
Indenture or in the Securities or the Guarantee is intended to or shall impair,
as among the Guarantors and the Holders of the Securities, the obligation of
each Guarantor, which is absolute and unconditional, to pay to the Holders of
the Securities the principal of and interest on the Securities as and when the
same shall become due and payable in accordance with the terms of the Guarantee,
or is intended to or shall affect the relative rights of the Holders of the
Securities and creditors of any Guarantor other
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than the holders of Guarantor Senior Indebtedness, nor shall anything herein or
therein prevent the Holder of any Security or the Trustee on their behalf from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article of the holders
of Guarantor Senior Indebtedness in respect of cash, property or securities of
any Guarantor received upon the exercise of any such remedy.
Without limiting the generality of the foregoing, nothing
contained in this Article shall restrict the right of the Trustee or the Holders
of Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Guarantor Senior Indebtedness
of any Guarantor then due and payable shall first be paid in full before the
Holders of the Securities or the Trustee are entitled to receive any direct or
indirect payment from such Guarantor of principal of or interest on the
Securities pursuant to such Guarantor's Guarantee.
SECTION 12.06. Notice to Trustee.
The Company and each Guarantor shall give prompt written
notice to the Trustee of any fact known to the Company or such Guarantor which
would prohibit the making of any payment to or by the Trustee in respect of the
Securities pursuant to the provisions of this Article. The Trustee shall not be
charged with knowledge of the existence of any default or event of default with
respect to any Guarantor Senior Indebtedness or of any other facts which would
prohibit the making of any payment to or by the Trustee unless and until the
Trustee shall have received notice in writing at its Corporate Trust Office to
that effect signed by an Officer of the Company or such Guarantor, or by a
holder of Guarantor Senior Indebtedness or trustee or agent therefor; and prior
to the receipt of any such written notice, the Trustee shall, subject to Article
Seven, be entitled to assume that no such facts exist; provided that if the
Trustee shall not have received the notice provided for in this Section at least
two Business Days prior to the date upon which by the terms of this Indenture
any moneys shall become payable for any purpose (including, without limitation,
the payment of the principal of or interest on any Security), then, regardless
of anything herein to the contrary, the Trustee shall have full power and
authority to receive any moneys from any Guarantor and to apply the same to the
purpose for which they were received, and shall not be affected by any notice to
the contrary which may be received by it on or after such prior date. Nothing
contained in this Section 12.06 shall limit the right of the holders of
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Guarantor Senior Indebtedness to recover payments as contemplated by Section
12.03. The Trustee shall be entitled to rely on the delivery to it of a written
notice by a Person representing himself or itself to be a holder of any
Guarantor Senior Indebtedness (or a trustee on behalf of, or other
representative of, such holder) to establish that such notice has been given by
a holder of such Guarantor Senior Indebtedness or a trustee or representative on
behalf of any such holder.
In the event that the Trustee determines in good faith that
any evidence is required with respect to the right of any Person as a holder of
Guarantor Senior Indebtedness to participate in any payment or distribution
pursuant to this Article, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Guarantor Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article, and if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
SECTION 12.07. Reliance on Judicial Order or
Certificate of Liquidating Agent.
Upon any payment or distribution of assets or securities of a
Guarantor referred to in this Article, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which bankruptcy, dissolution, winding-up,
liquidation or reorganization proceedings are pending, or upon a certificate of
the receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, delivered to the Trustee or to the Holders
of the Securities for the purpose of ascertaining the persons entitled to
participate in such distribution, the holders of Guarantor Senior Indebtedness
of such Guarantor and other indebtedness of such Guarantor, the amount thereof
or payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article.
SECTION 12.08. Trustee's Relation to Guarantor
Senior Indebtedness.
The Trustee and any Paying Agent shall be entitled to all the
rights set forth in this Article with respect to any Guarantor Senior
Indebtedness which may at any time be held by it in its individual or any other
capacity to the same extent as any other
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holder of Guarantor Senior Indebtedness, and nothing in this Indenture shall
deprive the Trustee or any Paying Agent of any of its rights as such holder.
With respect to the holders of Guarantor Senior Indebtedness,
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article, and no implied
covenants or obligations with respect to the holders of Guarantor Senior
Indebtedness shall be read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Guarantor Senior
Indebtedness (except as provided in Section 12.03(b)).
SECTION 12.09. Subordination Rights Not Impaired by
Acts or Omissions of the Guarantors or
Holders of Guarantor Senior Indebtedness.
No right of any present or future holders of any Guarantor
Senior Indebtedness to enforce subordination as provided herein shall at any
time in any way be prejudiced or impaired by any act or failure to act on the
part of any Guarantor or by any act or failure to act, in good faith, by any
such holder, or by any noncompliance by any Guarantor with the terms of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with. The provisions of this Article are intended to be for
the benefit of, and shall be enforceable directly by, the holders of Guarantor
Senior Indebtedness.
SECTION 12.10. Securityholders Authorize Trustee To
Effectuate Subordination of Guarantee.
Each Holder of Securities by his acceptance of such Securities
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
this Article, and appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up, liquidation or
reorganization of any Guarantor (whether in bankruptcy, insolvency,
receivership, reorganization or similar proceedings or upon an assignment for
the benefit of creditors or otherwise) tending towards liquidation of the
business and assets of such Guarantor, the filing of a claim for the unpaid
balance of its or his Securities in the form required in those proceedings.
SECTION 12.11. This Article Not To Prevent Events of Default.
The failure to make a payment on account of principal of
or interest on the Securities by reason of any provision of this
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Article shall not be construed as preventing the occurrence of an Event of
Default specified in clauses (1) or (2) of Section 6.01.
SECTION 12.12. Trustee's Compensation Not Prejudiced.
Nothing in this Article shall apply to amounts due to the
Trustee pursuant to other sections in this Indenture.
SECTION 12.13. No Waiver of Guarantee
Subordination Provisions.
Without in any way limiting the generality of Section 12.09,
the holders of Guarantor Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Guarantor Senior Indebtedness, do any one or more of the following: (a) change
the manner, place or terms of payment or extend the time of payment of, or renew
or alter, Guarantor Senior Indebtedness or any instrument evidencing the same or
any agreement under which Guarantor Senior Indebtedness is outstanding or
secured; (b) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Guarantor Senior Indebtedness; (c)
release any Person liable in any manner for the collection of Guarantor Senior
Indebtedness and (d) exercise or refrain from exercising any rights against any
Guarantor and any other Person.
SECTION 12.14. Payments May Be Paid Prior to Dissolution.
Nothing contained in this Article or elsewhere in this
Indenture shall prevent (i) a Guarantor, except under the conditions described
in Section 12.02, from making payments of principal of and interest on the
Securities, or from depositing with the Trustee any moneys for such payments, or
(ii) the application by the Trustee of any moneys deposited with it for the
purpose of making such payments of principal of and interest on the Securities,
to the holders entitled thereto unless at least two Business Days prior to the
date upon which such payment becomes due and payable, the Trustee shall have
received the written notice provided for in Section 12.02(b) or in Section
12.06. A Guarantor shall give prompt written notice to the Trustee of any
dissolution, winding-up, liquidation or reorganization of such Guarantor.
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ARTICLE 13
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls.
This Indenture is subject to the provisions of the TIA that
are required to be a part of this Indenture, and shall, to the extent
applicable, be governed by such provisions. If any provision of this Indenture
modifies any TIA provision that may be so modified, such TIA provision shall be
deemed to apply to this Indenture as so modified. If any provision of this
Indenture excludes any TIA provision that may be so excluded, such TIA provision
shall be excluded from this Indenture.
The provisions of TIA ss.ss. 310 through 317 that impose
duties on any Person (including the provisions automatically deemed included
unless expressly excluded by this Indenture) are a part of and govern this
Indenture, whether or not physically contained herein.
SECTION 13.02. Notices.
Any notice or communication shall be sufficiently given if in
writing and delivered in person, by facsimile and confirmed by overnight
courier, or mailed by first-class mail addressed as follows:
if to the Company:
Owens & Minor, Inc.
4800 Cox Road
Glen Allen, Virginia 23060
Attention: Glenn J. Dozier
Senior Vice President, Finance,
Chief Financial Officer
Facsimile: 804-273-0232
Telephone: 804-747-9794
with a copy to:
C. Porter Vaughan, III
Hunton & Williams
951 E. Byrd Street
Richmond, Virginia 23219
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if to the Trustee:
Crestar Bank
919 E. Main Street, 10th Floor
Richmond, Virginia 23219
Attention: Kelly A. Pickerel, Vice President
Facsimile: 804-782-7855
Telephone: 804-782-5726
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed, first class, postage
prepaid, to a Securityholder, including any notice delivered in connection with
TIA ss. 310(b), TIA ss. 313(c), TIA ss. 314(a) and TIA ss. 315(b), shall be
mailed to him at his address as set forth on the registration books of the
Registrar and shall be sufficiently given to him if so mailed within the time
prescribed. To the extent required by the TIA, any notice or communication shall
also be mailed to any Person described in TIA ss. 313(c).
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. Except for a notice to the Trustee, which is deemed given only
when received, if a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b)
with other Securityholders with respect to their rights under this Indenture or
the Securities. The Company, the Trustee, the Registrar and any other person
shall have the protection of TIA ss. 312(c).
SECTION 13.04. Certificate and Opinion as to Conditions
Precedent.
Upon any request or application by the Company to the Trustee
to take or refrain from taking any action under this Indenture, the Company
shall furnish to the Trustee at the request of the Trustee:
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(1) an Officers' Certificate in form and substance
satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance satisfactory
to the Trustee stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 13.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate
or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
SECTION 13.06.Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at
a meeting of Securityholders. The Paying Agent or Registrar may
make reasonable rules for its functions.
SECTION 13.07. Governing Law.
The laws of the State of New York shall govern this Indenture,
the Securities and the Guarantee without regard to principles of conflicts of
law.
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SECTION 13.08. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the
Company or any Guarantor shall not have any liability for any obligations of the
Company or any Guarantor under the Securities, the Guarantee or this Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. Each Securityholder by accepting a Security waives and releases
all such liability.
SECTION 13.09. Successors.
All agreements of the Company in this Indenture and the
Securities shall bind its successor. All agreements of each Guarantor in this
Indenture and Securities shall bind its successor. All agreements of the Trustee
in this Indenture shall bind its successor.
SECTION 13.10. Counterpart Originals.
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
SECTION 13.11. Severability.
In case any provision in this Indenture, in the Securities or
in the Guarantee shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby, and a Holder shall have no claim therefor against
any party hereto.
SECTION 13.12. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan
or debt agreement may not be used to interpret this Indenture.
SECTION 13.13. Legal Holidays.
If a payment date is a Legal Holiday at a place of payment,
payment may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
[Signature Pages Follow]
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
OWENS & MINOR, INC.
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Finance, Chief
Financial Officer
OWENS & MINOR MEDICAL, INC.
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Finance, Chief
Financial Officer
NATIONAL MEDICAL SUPPLY
CORPORATION
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Chief Financial Officer
OWENS & MINOR WEST, INC.
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Chief Financial Officer
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KOLEY'S MEDICAL SUPPLY, INC.
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Chief Financial Officer
LYONS PHYSICIAN SUPPLY COMPANY
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Chief Financial Officer
A. KUHLMAN & CO.
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Chief Financial Officer
STUART MEDICAL, INC.
By: /s/Glenn J. Dozier
Name: Glenn J. Dozier
Title: Senior Vice President,
Finance, Chief
Financial Officer
CRESTAR BANK, as Trustee
By: /s/K.A. Pickerel
Name: K. A. Pickerel
Title: Vice President
EXHIBIT A
OWENS & MINOR, INC.
No. $
10 7/8% SENIOR SUBORDINATED NOTE DUE 2006
Owens & Minor, Inc. promises to pay to
or registered assigns the principal sum of
Dollars on the Maturity Date of June 1, 2006.
Interest Payment Dates: June 1 and December 1
Record Dates: May 15 and November 15
IN WITNESS WHEREOF, OWENS & MINOR, INC. has caused this
instrument to be executed in its corporate name by a facsimile signature of its
_________________ and its ___________________ and has caused the facsimile of
its corporate seal to be affixed hereunto or imprinted hereon.
OWENS & MINOR, INC.
By
Title:
[SEAL]
Dated: By
Title:
Certificate of Authentication:
This is one of the 10 7/8% Senior Subordinated Notes due 2006
referred to in the within-mentioned Indenture.
By Date:
Authorized Signatory
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(REVERSE OF SECURITY)
OWENS & MINOR, INC.
10 7/8% Senior Subordinated Note due 2006
1. Interest.
Owens & Minor, Inc., a Virginia corporation (the "Company"),
promises to pay interest at the rate of 10 7/8% per annum on the principal
amount of this Security semiannually commencing on December 1, 1996, until the
principal hereof is paid or made available for payment. Interest on the
Securities will accrue from and including the most recent date to which interest
has been paid or, if no interest has been paid, from and including May 29, 1996,
through but excluding the date on which interest is paid. If an Interest Payment
Date falls on a day that is not a Business Day, the interest payment to be made
on such Interest Payment Date will be made on the next succeeding Business Day
with the same force and effect as if made on such Interest Payment Date, and no
additional interest will accrue as a result of such delayed payment. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment.
The interest payable on the Securities, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the person in whose name this Security is registered at
the close of business on the regular record date, which shall be the May 15 or
November 15 (whether or not a Business Day) next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for, and any
interest payable on such defaulted interest (to the extent lawful), will
forthwith cease to be payable to the Holder on such regular record date and
shall be paid to the person in whose name this Security is registered at the
close of business on a special record date for the payment of such defaulted
interest to be fixed by the Company, notice of which shall be given to Holders
not less than 15 days prior to such special record date. Payment of the
principal of and interest on this Security will be made at the agency of the
Company maintained for that purpose in New York, New York and at any other
office or agency maintained by the Company for such purpose, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
option of the Company payment of interest may be made by check mailed to the
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address of the person entitled thereto as such address shall appear in the
Security register.
3. Paying Agent and Registrar.
Initially, Crestar Bank (the "Trustee") will act as Paying
Agent and Registrar. The Company may change any Paying Agent, Registrar or
co-Registrar without notice to the Holders of Securities. The Company or any of
its Subsidiaries may act as Registrar, co-Registrar or, except in certain
circumstances specified in the Indenture, Paying Agent.
4. Indenture.
This Security is one of a duly authorized issue of Securities
of the Company, designated as its 10 7/8% Senior Subordinated Notes due 2006
(the "Securities"), limited in aggregate principal amount to $150,000,000
(except for Securities issued in substitution for destroyed, lost or stolen
Securities) issuable under an indenture dated as of May 29, 1996 (the
"Indenture"), among the Company, the Guarantors (herein collectively called the
"Guarantors", which term includes any successor Person or additional Guarantor
under the Indenture) and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by the Trust
Indenture Act of 1939 (the "Act") (15 U.S. Code ss.ss. 77aaa-77bbbb) as in
effect on the date of the Indenture and the date the Indenture is qualified
under the Act. The Securities are subject to all such terms, and Holders of
Securities are referred to the Indenture and the Act for a statement of them.
Each Securityholder, by accepting a Security, agrees to be bound to all of the
terms and provisions of the Indenture, as the same may be amended from time to
time. Payment on each Security is guaranteed on a senior subordinated basis,
jointly and severally, by the Guarantors pursuant to Article Eleven of the
Indenture.
The Securities are subordinated in right of payment to all
Senior Indebtedness of the Company to the extent and in the manner provided in
the Indenture. Each Holder of a Security, by accepting a Security, agrees to
such subordination, authorizes the Trustee to give effect to such subordination
and appoints the Trustee as attorney-in-fact for such purpose.
Capitalized terms contained in this Security to the extent not
defined herein shall have the meanings assigned to them in the Indenture.
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5. Optional Redemption.
(a) The Securities are not redeemable prior to June 1, 2001,
except as provided in clause (b) below of this paragraph 5. On and after such
date, the Securities may be redeemed at any time, in whole or in part, at the
option of the Company, at redemption prices (expressed as percentages of the
principal amount) set forth below, if redeemed during the 12-month period
beginning June 1 of the year indicated below, in each case together with
interest accrued to the date fixed for redemption:
Year Percentage
2001.................................................. 105.4375%
2002.................................................. 103.6250
2003.................................................. 101.8125
2004 and thereafter................................... 100.0000
(b) At any time prior to June 1, 1999, the Company may redeem
up to 33-1/3% of the principal amount of the Securities with the net cash
proceeds received by the Company from a public offering of Capital Stock of the
Company (other than Disqualified Stock), at a redemption price (expressed as a
percentage of the principal amount) of 110.875% of the principal amount thereof,
plus accrued and unpaid interest to the date fixed for redemption; provided,
however, that at least $100 million in aggregate principal amount of the
Securities remains outstanding immediately after any such redemption (excluding
any Securities owned by the Company or any of its Affiliates). Notice of
redemption pursuant to this paragraph must be mailed to Holders of Securities
not later than 60 days following consummation of such public offering.
6. Purchase upon Occurrence of a
Change of Control.
Within 30 days of the occurrence of a Change of Control, the
Company will offer to purchase the Securities, in whole and not in part, at a
purchase price equal to 101% of the principal amount thereof plus any accrued
and unpaid interest thereon.
7. Notice of Redemption.
Notice of redemption will be mailed by first class mail at
least 30 days but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at his registered address. Securities in
denominations larger than $1,000 may be redeemed in part. On and after the
redemption date, interest
A-5
ceases to accrue on those Securities or portion of them called for
redemption.
8. Denominations; Transfer; Exchange.
The Securities are in registered form without coupons in
denominations of $1,000 and integral multiples of $1,000. A Holder may transfer
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not transfer or exchange any Securities
selected for redemption.
9. Persons Deemed Owners.
The registered Holder of a Security may be treated as the
owner of it for all purposes.
10. Unclaimed Funds.
If funds for the payment of principal or interest remain
unclaimed for two years, the Trustee or Paying Agent will repay the funds to the
Company at its request. After such repayment Holders of Securities entitled to
such funds must look to the Company for payment unless an abandoned property law
designates another person.
11. Discharge Prior to Redemption or Maturity.
The Indenture will be discharged and cancelled except for
certain Sections thereof, subject to the terms of the Indenture, upon the
payment of all the Securities or upon the irrevocable deposit with the Trustee
of funds or United States Government Obligations sufficient for such payment or
redemption.
12. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the Securities
may be amended or supplemented with the consent of the Holders of at least a
majority in principal amount of the outstanding Securities, and any past default
or compliance with any provision may be waived with the consent of the Holders
of a majority in principal amount of the outstanding Securities. Without notice
to or the consent of any Holder, the Company, the Guarantors and the Trustee may
amend or supplement the Indenture or the Securities to cure any ambiguity,
defect or inconsistency, or to make any change that does not adversely affect
the rights of any Holder of Securities.
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13. Restrictive Covenants.
The Securities are general unsecured senior subordinated
obligations of the Company limited to the aggregate principal amount of
$150,000,000. The Indenture restricts, among other things, the ability of the
Company or any of its Subsidiaries to permit any Liens to be imposed on their
assets, to make certain payments and investments, limits the Indebtedness which
the Company and its Subsidiaries may incur and limits the terms on which the
Company may engage in Asset Dispositions. The Company is also obligated under
certain circumstances to make an offer to purchase Securities with the net cash
proceeds of certain Asset Dispositions. The Company must report quarterly to the
Trustee on compliance with certain covenants in the Indenture.
14. Successor Corporation.
Pursuant to the Indenture, the ability of the Company to
consolidate with, merge with or into or transfer its assets to another person is
conditioned upon certain requirements, including certain financial requirements
applicable to the surviving Person.
15. Defaults and Remedies.
If an Event of Default shall occur and be continuing, the
principal of all of the outstanding Securities, plus all accrued and unpaid
interest, if any, to the date the Securities become due and payable, may be
declared due and payable in the manner and with the effect provided in the
Indenture.
16. Trustee Dealings with Company.
The Trustee in its individual or any other capacity, may
become the owner or pledgee of Securities and make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may otherwise
deal with the Company or its Affiliates, as if it were not Trustee.
17. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the
Company or any Guarantor shall not have any liability for any obligations of the
Company or any Guarantor under the Securities, the Guarantee or the Indenture or
for any claim based on, in respect of or by reason of such obligations or their
creation. Each Holder of a Security by accepting a Security waives and releases
all such liability. The waiver and release are part of the consideration for the
issue of the Securities.
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18. Authentication.
This Security shall not be valid until the Trustee signs the
certificate of authentication on the other side of this Security.
19. Abbreviations.
Customary abbreviations may be used in the name of
Securityholder 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).
20. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
21. Governing Law.
The laws of the State of New York shall govern the Indenture,
this Security and the Guarantee without regard to principles of conflicts of
law.
The Company will furnish to any Holder of record of Securities
upon written request and without charge a copy of the Indenture.
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[FORM OF NOTATION ON SECURITY RELATING TO GUARANTEE]
SENIOR SUBORDINATED GUARANTEE
The Guarantors (as defined in the Indenture referred to in the
Security upon which this notation is endorsed) hereby, jointly and severally,
unconditionally guarantee on a senior subordinated basis (such guarantee by each
Guarantor being referred to herein as the "Guarantee") the due and punctual
payment of the principal of, premium, if any, and interest on the Securities,
whether at maturity, by acceleration or otherwise, the due and punctual payment
of interest on the overdue principal, premium and interest, if any, on the
Securities, and the due and punctual performance of all other obligations of the
Company to the Holders or the Trustee, all in accordance with the terms set
forth in Article Eleven of the Indenture.
The obligations of each Guarantor to the Holders of Securities
and to the Trustee pursuant to the Guarantee and the Indenture are expressly set
forth, and are expressly subordinated and subject in right of payment to the
prior payment in full of all Guarantor Senior Indebtedness of such Guarantor, to
the extent and in the manner provided, in Article Twelve of the Indenture, and
reference is hereby made to such Indenture for the precise terms of the
Guarantee therein made.
The Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Securities upon which the
Guarantee is noted shall have been executed by the Trustee under the Indenture
by the manual signature of one of its authorized officers.
This Guarantee shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflicts of law.
This Guarantee is subject to release upon the terms set forth
in the Indenture.
OWENS & MINOR MEDICAL, INC.
NATIONAL MEDICAL SUPPLY
CORPORATION
OWENS & MINOR WEST, INC.
KOLEY'S MEDICAL SUPPLY, INC.
A-9
LYONS PHYSICIAN SUPPLY COMPANY
A. KUHLMAN & CO.
STUART MEDICAL, INC.
By:
Name:
Title:
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ASSIGNMENT FORM
If you the Holder want to assign this Security, fill in the
form below and have your signature guaranteed:
I or we assign and transfer this Security to:
Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint ,
agent to transfer this Security on the books of the Company. The
agent may substitute another to act for him.
Dated: Signed:
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee:
A-11
OPTION OF HOLDER TO ELECT PURCHASE
If you the Holder want to elect to have this Security purchased by
the Company, check the box: ( )
If you want to elect to have only part of this Security purchased
by the Company, state the amount: $
Dated: Your signature:
(Sign exactly as
name appears on the
other side of this
Security)
Signature Guarantee: