Form of Indenture, dated as of August 20, 1996, among Haynes
International, Inc., Haynes Holdings, Inc. and National City Bank, as
Trustee, relating to the 11.625% Senior Notes Due 2004, table of
contents and cross-reference sheet
HAYNES INTERNATIONAL, INC.
and
NATIONAL CITY BANK, AS TRUSTEE
INDENTURE
Dated as of August 23, 1996
$140,000,000
11e% Senior Notes due 2004
TABLE OF CONTENTS
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PAGE
PARTIES 1
RECITALS 1
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1. Definitions 1
Section 1.2. Other Definitions 20
Section 1.3. Compliance Certificates and Opinions 21
Section 1.4. Form of Documents Delivered to Trustee 21
Section 1.5. Acts of Holders 22
Section 1.6. Notices, etc., to Trustee and the Company 23
Section 1.7. Notice to Holders; Waiver 24
Section 1.8. Conflict with Trust Indenture Act 24
Section 1.9. Effect of Headings and Table of Contents. 24
Section 1.10. Successors and Assigns 24
Section 1.11. Separability Clause 25
Section 1.12. Benefits of Indenture 25
Section 1.13. GOVERNING LAW 25
Section 1.14. Legal Holidays 25
Section 1.15. Schedules 25
Section 1.16. Counterparts 25
ARTICLE II
SECURITY FORMS
Section 2.1. Forms Generally 26
Section 2.2. Form of Face of Security 27
Section 2.3. Form of Reverse of Security 28
Section 2.4. Form of Trustee's Certificate of Authentication 33
ARTICLE III
THE SECURITIES
Section 3.1. Title and Terms 34
Section 3.2. Denominations 34
Section 3.3. Execution, Authentication, Delivery and Dating 34
Section 3.4. Temporary Securities 36
Section 3.5. Registration, Registration of Transfer and Exchange 36
Section 3.6. Mutilated, Destroyed, Lost and Stolen Securities 37
Section 3.7. Payment of Interest; Interest Rights Preserved 38
Section 3.8. Persons Deemed Owners 39
Section 3.9. Cancellation 40
Section 3.10. Computation of Interest 40
Section 3.11. Depositary Procedures. 40
Section 3.12. Book-Entry. 41
Section 3.13. Same-Day Settlement and Payment. 41
Section 3.14. Legends. 41
ARTICLE IV
DEFEASANCE AND COVENANT DEFEASANCE
Section 4.1. Company's Option to Effect Defeasance or Covenant Defeasance 42
Section 4.2. Defeasance and Discharge 42
Section 4.3. Covenant Defeasance 42
Section 4.4. Conditions to Defeasance or Covenant Defeasance 43
Section 4.5. Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions 45
Section 4.6. Reinstatement 46
ARTICLE V
REMEDIES
Section 5.1. Events of Default 46
Section 5.2. Acceleration of Maturity; Rescission and Annulment 48
Section 5.3. Collection of Indebtedness and Suits for Enforcement by Trustee 49
Section 5.4. Trustee May File Proofs of Claim 50
Section 5.5. Trustee May Enforce Claims Without Possession of Securities 51
Section 5.6. Application of Money Collected 51
Section 5.7. Limitation on Suits 52
Section 5.8. Unconditional Right of Holders to Receive Principal, Premium and Interest 52
Section 5.9. Restoration of Rights and Remedies 52
Section 5.10. Rights and Remedies Cumulative 53
Section 5.11. Delay or Omission Not Waiver 53
Section 5.12. Control by Holders 53
Section 5.13. Waiver of Past Defaults 53
Section 5.14. Undertaking for Costs 54
Section 5.15. Waiver of Stay, Extension or Usury Laws 54
Section 5.16. Remedies Subject to Applicable Law 55
ARTICLE VI
THE TRUSTEE
Section 6.1. Notice of Defaults 55
Section 6.2. Certain Rights of Trustee 55
Section 6.3. Trustee Not Responsible for Recitals, Dispositions of Securities or Application of Proceeds Thereof. 57
Section 6.4. Trustee and Agents May Hold Securities; Collections; etc. 57
Section 6.5. Money Held in Trust 57
Section 6.6. Compensation and Indemnification of Trustee and Its Prior Claim. 57
Section 6.7. Conflicting Interests. 58
Section 6.8. Corporate Trustee Required; Eligibility. 58
Section 6.9. Resignation and Removal; Appointment of Successor Trustee. 58
Section 6.10. Acceptance of Appointment by Successor. 60
Section 6.11. Merger, Conversion, Consolidation or Succession to Business. 61
Section 6.12. Preferential Collection of Claims Against Company. 61
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 7.1. Company to Furnish Trustee Names and Addresses of Holders. 62
Section 7.2. Disclosure of Names and Addresses of Holders. 62
Section 7.3. Reports by Trustee. 62
Section 7.4. Reports by Company. 63
ARTICLE VIII
CONSOLIDATION, MERGER, SALE OF ASSETS
Section 8.1. Company May Merge, Consolidate etc., Only on Certain Terms 64
Section 8.2. Successor Substituted 65
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures and Agreements without Consent of Holders. 65
Section 9.2. Supplemental Indentures and Agreements with Consent of Holders. 66
Section 9.3. Execution of Supplemental Indentures and Agreements 68
Section 9.4. Effect of Supplemental Indentures 68
Section 9.5. Conformity with Trust Indenture Act 68
Section 9.6. Reference in Securities to Supplemental Indentures 68
Section 9.7. Record Date 68
ARTICLE X
COVENANTS
Section 10.1. Payment of Principal, Premium and Interest 69
Section 10.2. Maintenance of Office or Agency 69
Section 10.3. Money for Security Payments to be Held in Trust 70
Section 10.4. Corporate Existence 71
Section 10.5. Payment of Taxes and Other Claims 71
Section 10.6. Maintenance of Properties 71
Section 10.7. Insurance 72
Section 10.8. Limitation on Indebtedness 72
Section 10.9. Limitation on Restricted Payments 73
Section 10.10. Limitation on Transactions with Affiliates 76
Section 10.11. Limitation on Liens 76
Section 10.12. Limitation on Sale of Assets 78
Section 10.13. Purchase of Securities upon a Change of Control 82
Section 10.14. Optional Redemption Upon Change of Control 85
Section 10.15. Limitation on Issuance and Sale of Preferred Stock of Subsidiaries 86
Section 10.16. Limitation on Dividends and Other Payment Restrictions Affecting Subsidiaries 86
Section 10.17. Provision of Financial Statements 87
Section 10.18. Statement by Officers as to Default 87
Section 10.19. Waiver of Certain Covenants 88
ARTICLE XI
REDEMPTION OF SECURITIES
Section 11.1. Right of Redemption 88
Section 11.2. Applicability of Article 89
Section 11.3. Election to Redeem; Notice to Trustee 89
Section 11.4. Selection by Trustee of Securities to Be Redeemed 89
Section 11.5. Notice of Redemption 89
Section 11.6. Deposit of Redemption Price 90
Section 11.7. Securities Payable on Redemption Date 91
Section 11.8. Securities Redeemed or Purchased in Part 91
ARTICLE XII
SATISFACTION AND DISCHARGE
Section 12.1. Satisfaction and Discharge of Indenture 92
Section 12.2. Application of Trust Money 93
SIGNATURES AND SEALS
ACKNOWLEDGMENTS
SCHEDULE I. Restrictions on Dividends of Subsidiaries
INDENTURE, dated as of August 23, 1996, between HAYNES
INTERNATIONAl, INC., a Delaware corporation (as more fully defined below, the
"Company"), and National City Bank, a national banking association, as trustee
(the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of 11e%
Senior Notes due 2004 (the "Securities"), of substantially the tenor and
amount hereinafter set forth, and to provide therefor, the Company has duly
authorized the execution and delivery of this Indenture;
This Indenture is subject to, and shall be governed by, the
provisions of the Trust Indenture Act that are required to be part of and to
govern indentures qualified under the Trust Indenture Act; and
All acts and things necessary have been done to make (i) the
Securities, when executed by the Company and authenticated and delivered
hereunder and duly issued by the Company, the valid obligations of the Company
and (ii) this Indenture a valid agreement of the Company in accordance with
the terms of this Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities, as
follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article, and include the plural as well as the
singular;
(b) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(c) all accounting terms not otherwise defined herein have
the meanings assigned to them in accordance with GAAP;
(d) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision; and
(e) all references to $, US$, dollars or United States
dollars shall refer to the lawful currency of the United States of America.
The following terms shall have the meanings set forth in this
Section.
"Acquired Indebtedness" means Indebtedness of a Person (i) existing
at the time such Person becomes a Subsidiary or (ii) assumed in connection
with the acquisition of assets from such Person, in each case, other than
Indebtedness incurred in connection with, or in contemplation of, such Person
becoming a Subsidiary or such acquisition. Acquired Indebtedness shall be
deemed to be incurred on the date of the related acquisition of assets from
any Person or the date the acquired Person becomes a Subsidiary.
"Adjusted Consolidated Interest Expense" of any Person means,
without duplication, for any period, as applied to any Person, the sum of (a)
the interest expense of such Person and its Consolidated Subsidiaries for such
period, on a Consolidated basis, including without limitation, (i)
amortization of debt discount, (ii) the net cost under interest rate contracts
(including amortization of discounts), (iii) the interest portion of any
deferred payment obligation and (iv) accrued interest, plus (b)(i) the
interest component of the Capital Lease Obligations paid, accrued and/or
scheduled to be paid, or accrued by such Person during such period, and (ii)
all capitalized interest of such Person and its Consolidated Subsidiaries, in
each case as determined in accordance with GAAP consistently applied.
"Affiliate" means, (i) with respect to any specified Person, (A) any
other Person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified Person or (B) any other
Person that owns, directly or indirectly, 5% or more of such Person's Capital
Stock or any officer or director of any such specified Person or other Person
described in clauses (A) or (B), or (ii) with respect to any natural Person,
any person having a relationship with such Person by blood, marriage or
adoption not more remote than first cousin. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person directly or
indirectly, whether through ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease
or other disposition (including, without limitation, by way of merger,
consolidation or Sale and Leaseback Transaction)(collectively, a "transfer"),
directly or indirectly, in one or a series of related transactions, of (a) any
Capital Stock of any Subsidiary; (b) all or substantially all of the
properties and assets of any division or line of business of the Company or
its Subsidiaries; or (c) any other properties or assets of the Company or any
Subsidiary, other than in the ordinary course of business; provided that the
sale of any material portion of the Company's facilities in Kokomo, Indiana,
Arcadia, Louisiana or Openshaw, England shall be deemed to be not in the
ordinary course of business. For the purposes of this definition, the term
"Asset Sale" shall not include any transfer of properties and assets (A) that
is governed by the provisions described under "Consolidation, Merger, Sale of
Assets," (B) that is of the Company to any Wholly- Owned
Subsidiary, or of any Subsidiary to the Company or any Wholly-Owned Subsidiary
in accordance with the terms hereof or (C) for which the Fair Market Value of
any transferred properties or assets is less than $1 million.
"Average Life to Stated Maturity" means, as of the date of
determination with respect to any Indebtedness, the quotient obtained by
dividing (i) the sum of the products of (a) the number of years from the date
of determination to the date or dates of each successive scheduled principal
payment of such Indebtedness multiplied by (b) the amount of each such
principal payment; by (ii) the sum of all such principal payments.
"Bankruptcy Law" means Title 11, United States Bankruptcy Code of
1978, as amended, or any similar United States Federal or State law relating
to bankruptcy, insolvency, receivership, winding-up, liquidation,
reorganization or relief of debtors or any amendment to, succession to or
change in any such law.
"Board of Directors" means the board of directors of the Company or
any duly authorized committee of such board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted
by such Board of Directors and to be in full force and effect on the date of
such certification, and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in The City of New
York or the city in which the principal office of the Trustee is located are
authorized or obligated by law or executive order to close.
"Capital Lease Obligation" of any Person means any obligations of
such Person and its Subsidiaries on a Consolidated basis under any capital
lease of real or personal property which, in accordance with GAAP, has been
recorded as a capitalized lease obligation.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of such Person's
capital stock.
"Change of Control" means the occurrence of any of the following
events: (i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act), other than Permitted Holders, is or becomes
the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act, except that a Person shall be deemed to have "beneficial ownership" of
all shares that such Person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 50% of the total outstanding Voting Stock of the
Company, (ii) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors of the Company
(together with any new directors whose election to such Board or whose
nomination for election by the stockholders of the Company, was approved by a
vote of 66 2/3% of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of such Board of Directors then in office; (iii) the Company
consolidates with, or merges with or into, another Person or sells, assigns,
conveys, transfers, leases or otherwise disposes of all or substantially all
of its assets to any Person, or any Person consolidates with, or merges with
or into, the Company, in any such event pursuant to a transaction in which the
outstanding Voting Stock of the Company is converted into or exchanged for
cash, securities or other property, other than any such transaction where (a)
the outstanding Voting Stock of the Company is converted into or exchanged for
(1) Voting Stock (other than Redeemable Capital Stock) of the surviving or
transferee corporation or (2) cash, securities and other property in an amount
which could be paid by the Company as a Restricted Payment as described under
Section 10.9 (and such amount shall be treated as a Restricted Payment as
described under Section 10.9) and (b) immediately after such transaction no
"person" or "group" (as such terms are used in Section 13(d) and 14(d) of the
Exchange Act), other than Permitted Holders, is the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person
shall be deemed to have "beneficial ownership" of all securities that such
person has the right to acquire, whether such right is exercisable immediately
or only after the passage of time), directly or indirectly, of more than 50%
of the total outstanding Voting Stock of the surviving or transferee
corporation; or (iv) the Company is liquidated or dissolved or adopts a plan
of liquidation or dissolution other than in a transaction which complies with
the provisions described under Article VIII.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act of
1939, then the body performing such duties at such time.
"Common Stock" means the common stock, par value $.01 per share, of
the Company.
"Company" means Haynes International, Inc., a corporation
incorporated under the laws of Delaware until a successor Person shall have
become such pursuant to the applicable provisions of the Indenture, and
thereafter "Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by any one if its Chairman of the
Board, its Vice Chairman, its President or a Vice President (regardless of
Vice Presidential designation), and by any one of its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Consolidated Fixed Charge Coverage Ratio" of any Person means, for
any period, the ratio of EBITDA to the sum of Adjusted Consolidated Interest
Expense for such period and cash and non-cash dividends paid on any Preferred
Stock of such Person during such period; provided that (i) in making such
computation, the Adjusted Consolidated Interest Expense attributable to
interest on any Indebtedness shall be computed on a pro forma basis
(calculated as described under Article X) and (A) where such Indebtedness was
outstanding during the period and bore a floating interest rate, interest
shall be computed as if the rate in effect on the date of computation had been
the applicable rate for the entire period and (B) where such indebtedness was
not outstanding during the period for which the computation is being made but
which bears, at the option of the Company, a fixed or floating rate of
interest, shall be computed by applying at the option of the Company, either
the fixed or floating rate and (ii) in making such computation, the Adjusted
Consolidated Interest Expense of such Person attributable to interest on any
Indebtedness under a revolving credit facility computed on a pro forma basis
shall be computed based upon the average daily balance of such Indebtedness
during the applicable period.
"Consolidated Income Tax Expense" means for any period, as applied
to any Person, the provision for federal, state, local and foreign income
taxes of such Person and its Consolidated Subsidiaries for such period as
determined in accordance with GAAP consistently applied.
"Consolidated Net Income" of any Person means, for any period, the
consolidated net income (or loss) of such Person and its Consolidated
Subsidiaries for such period as determined in accordance with GAAP
consistently applied, adjusted, to the extent included in calculating such net
income (loss), by excluding, without duplication, (i) all extraordinary gains
or losses (less all fees and expenses relating thereto), (ii) the portion of
net income (or loss) of such Person and its Consolidated Subsidiaries
allocable to minority interests in unconsolidated Persons to the extent that
cash dividends or distributions have not actually been received by such Person
or one of its Consolidated Subsidiaries, (iii) net income (or loss) of any
Person combined with the Company or any of its Subsidiaries on a "pooling of
interests" basis attributable to any period prior to the date of combination,
(iv) any gain or loss, net of taxes, realized upon the termination of any
employee pension benefit plan, (v) net gains or losses (less all fees and
expenses relating thereto) in respect of dispositions of assets other than in
the ordinary course of business, (vi) the expenses recognized in connection
with the payment of the prepayment premiums related to the Redemption, (vii)
the expenses recognized in connection with the termination of and repayment of
amounts outstanding under the Existing Credit Facility, (viii) the expenses
recognized related to amortization of fees and other charges in connection
with the 1989 Acquisition, (ix) an amount equal to the excess of (A) the
interest expense incurred on the Existing Notes and the Securities during the
period following the consummation of the offering of the Securities and prior
to the date of the Redemption, over (B) the interest income earned on the
proceeds from the offering of the Securities designated for the Redemption
during the same period, or (x) the net income of any Subsidiary to the extent
that the declaration of dividends or similar distributions by that Subsidiary
of that income is not at the time permitted, directly or indirectly, by
operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Subsidiary or its stockholders.
"Consolidated Net Worth" of any Person means the Consolidated
stockholders' equity (excluding Redeemable Capital Stock) of such Person and
its Subsidiaries, as determined in accordance with GAAP consistently applied.
"Consolidated Non-Cash Charges" of any Person means, for any period,
the aggregate depreciation, amortization and other non-cash charges of such
Person and its Consolidated Subsidiaries for such period, as determined in
accordance with GAAP (excluding any non-cash charge that requires an accrual
or reserve for cash charges for any future period and all non-cash charges
incurred in connection with the valuation of inventory on a LIFO basis).
"Consolidation" means, with respect to the accounts of any Person,
the consolidation of such Person and each of its subsidiaries if and to the
extent the accounts of such Person and each of its subsidiaries would normally
be consolidated with those of such Person, all in accordance with GAAP
consistently applied. The term "Consolidated" shall have a similar meaning.
"Corporate Trust Office" means the office of the Trustee or an
affiliate or agent thereof at which at any particular time the corporate trust
business for the purposes of this Indenture shall be principally administered,
which office at the date of execution of this Indenture is located at 101 West
Washington Street, Suite 655 South, Indianapolis, Indiana 46255.
"Default" means any event which is, or after notice or passage of
time or both would be, an Event of Default.
"Disinterested Director" means, with respect to any transaction or
series of related transactions, a member of the Board of Directors who does
not have any material direct or indirect financial interest in or with respect
to such transaction or series of related transactions.
"EBITDA" means the sum of Consolidated Net Income, Adjusted
Consolidated Interest Expense, Consolidated Income Tax Expense and
Consolidated Non-Cash Charges deducted in computing Consolidated Net Income,
in each case, for such period, of the Company and its Subsidiaries on a
Consolidated basis, all determined in accordance with GAAP consistently
applied.
"Eligible Inventory" means Inventory consisting of finished goods
held for resale in the ordinary course of business of the Company, raw
materials for such finished goods and work-in-process and semi-finished goods
which satisfy and continue to satisfy the criteria as set forth below as
determined by the agent under the New Credit Facility in good faith. In
general, Eligible Inventory shall not include (a) components which are not
part of finished goods; (b) spare parts for equipment; (c) packaging and
shipping materials; (d) supplies used or consumed in the Company's business;
(e) Inventory at premises other than those owned and controlled by the
Company, except if the agent under the New Credit Facility shall have received
an agreement in writing from the person in possession of such Inventory and/or
the owner or operator of such premises in form and substance satisfactory to
such agent, acknowledging the first priority security interest in the
Inventory of such agent, for itself and the ratable benefit of the creditors
under the New Credit Facility, waiving security interests and claims by such
person against the Inventory and permitting such agent access to, and the
right to remain on, the premises so as to exercise the rights and remedies of
such agent for itself and the ratable benefit of the creditors under the New
Credit Facility, and otherwise deal with the collateral; (f) Inventory subject
to a security interest or lien in favor of any person other than the agent
under the New Credit Facility (except those permitted under the New Credit
Facility); (g) bill and hold goods; (h) unserviceable, obsolete or slow moving
Inventory, (i) Inventory which is not subject to the first priority, valid and
perfected security interest of the agent under the New Credit Facility; (j)
returned, damaged and/or defective Inventory; or (k) Inventory purchased or
sold on consignment. General criteria for Eligible Inventory may be
established and revised from time to time by the agent under the New Credit
Facility in good faith based on events, conditions, circumstances or risks
which such agent in good faith determines are reasonably likely to affect the
Inventory, the value of the Inventory or the security interests and other
rights in the Inventory of such agent, for itself and the ratable benefit of
the creditors under the New Credit Facility, and for which no availability
reserve has been established.
"Event of Default" has the meaning specified in Article V.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing Credit Facility" means the revolving credit facility
established pursuant to a Loan and Security Agreement between the Company and
Congress Financial Corporation (Central) dated August 11, 1994, as amended.
"Existing Notes" means the Company's 11 % Senior Secured Notes due
1998 and 13 % Senior Subordinated Notes due 1999.
"Fair Market Value" means, with respect to any asset or property,
the sale value that would be obtained in an arm's-length transaction between
an informed and willing seller under no compulsion to sell and an informed and
willing buyer.
"Generally Accepted Accounting Principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied,
which are in effect on the date of this Indenture.
"Guaranteed Debt" of any Person means, without duplication, all
Indebtedness of any other Person (debtor) referred to in the definition of
"Indebtedness" contained in this Section guaranteed directly or indirectly in
any manner by such Person, or in effect guaranteed directly or indirectly by
such Person through an agreement (i) to pay or purchase such Indebtedness or
to advance or supply funds for the payment or purchase of such Indebtedness,
(ii) to purchase, sell or lease (as lessee or lessor) property, or to purchase
or sell services, primarily for the purpose of enabling the debtor to make
payment of such Indebtedness or to assure the holder of such Indebtedness
against loss, (iii) to supply funds to, or in any other manner invest in, the
debtor (including any agreement to pay for property or services without
requiring that such property be received or such services be rendered), (iv)
to maintain working capital or equity capital of the debtor, or otherwise to
maintain the net worth, solvency or other financial condition of the debtor or
(v) otherwise to assure a creditor against loss; provided that the term
"guarantee" shall not include endorsements for collection or deposit, in
either case in the ordinary course of business.
"Holder" means a Person in whose name a Security is registered in
the Security Register.
"Indebtedness" means, with respect to any Person, without
duplication, (i) all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services, excluding any trade payables
and other accrued current liabilities arising in the ordinary course of
business, but including, without limitation, all obligations, contingent or
otherwise, of such Person in connection with any letters of credit issued
under letter of credit facilities, acceptance facilities or other similar
facilities and in connection with any agreement to purchase, redeem, exchange,
convert or otherwise acquire for value any Capital Stock of such Person, or
any warrants, rights or options to acquire such Capital Stock, now or
hereafter outstanding, (ii) all obligations of such Person evidenced by bonds,
notes, debentures or other similar instruments, (iii) all indebtedness created
or arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even if the rights and remedies
of the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), but excluding trade
payables arising in the ordinary course of business, (iv) all obligations
under Interest Rate Agreements of such Person, (v) all Capital Lease
Obligations of such Person, (vi) all Indebtedness referred to in clauses (i)
through (v) above of other Persons and all dividends of other Persons, the
payment of which is secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien,
upon or with respect to property (including, without limitation, accounts and
contract rights) owned by such Person, even though such Person has not assumed
or become liable for the payment of such Indebtedness, (vii) all Guaranteed
Debt of such Person, (viii) all Redeemable Capital Stock valued at the greater
of its voluntary or involuntary maximum fixed repurchase price plus accrued
and unpaid dividends, and (ix) any amendment, supplement, modification,
deferral, renewal, extension, refunding or refinancing of any liability of the
types referred to in clauses (i) through (viii) above. For purposes hereof,
the "maximum fixed repurchase price" of any Redeemable Capital Stock which
does not have a fixed repurchase price shall be calculated in accordance with
the terms of such Redeemable Capital Stock as if such Redeemable Capital Stock
were purchased on any date on which Indebtedness shall be required to be
determined pursuant to the Indenture, and if such price is based upon, or
measured by, the fair market value of such Redeemable Capital Stock, such fair
market value to be determined in good faith by the Board of Directors of the
issuer of such Redeemable Capital Stock.
"Indenture" means this instrument as originally executed (including
all exhibits and schedules thereto) and as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof.
"Indenture Obligations" means the obligations of the Company and any
other obligor under the Indenture or under the Securities to pay principal of,
premium, if any, and interest when due and payable, and all other amounts due
or to become due under or in connection with the Indenture, the Securities and
the performance of all other obligations to the Trustee and the holders under
the Indenture and the Securities, according to the terms thereof.
"Independent Financial Advisor" means a nationally recognized
investment banking firm (i) which does not, and whose directors, officers and
employees or Affiliates do not, have a direct or indirect financial interest
in the Company and (ii) which, in the judgment of the board of directors of
the Company, is otherwise independent and qualified to perform the task for
which it is to be engaged.
"Interest Payment Date" means the Stated Maturity of a regular
installment of interest on the Securities or the Special Payment Date with
respect to Defaulted Interest.
"Interest Rate Agreements" means one or more of the following
agreements which shall be entered into by one or more financial institutions:
interest rate protection agreements (including, without limitation, interest
rate swaps, caps, floors, collars and similar agreements) and/or other types
of interest rate hedging agreements from time to time.
"Inventory" means all of the Company's now-owned and hereafter
acquired inventory, goods, merchandise, and other personal property, wherever
located, to be furnished under any contract of service or held for sale or
lease, all raw materials, work-in-process, semi- finished goods, finished
goods, returned and repossessed goods, and materials and supplies of any kind,
nature or description which are or might be consumed in the Company's business
or used in connection with the manufacture, packing, shipping, advertising,
selling or finishing of such inventory, goods, merchandise and other personal
property, and all documents of title or other documents representing them.
"Investment Grade" means BBB- or higher by S&P or Baa3 or higher by
Moody's or the equivalent of such ratings by S&P or Moody's or in the event
Moody's or S&P shall cease rating the Securities and the Company shall select
any Rating Agency, the equivalent of such ratings by another Rating Agency.
"Investments" means, with respect to any Person, directly or
indirectly, any advance, loan, or other extension of credit or capital
contribution to (by means of any transfer of cash or other property to others
or any payment for property or services for the account or use of others), or
any purchase, acquisition or ownership by such Person of any Capital Stock,
bonds, notes, debentures or other securities issued or owned by any other
Person.
"Lien" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation or other encumbrance
upon or with respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired.
"Material Subsidiary" means a Subsidiary that is a "significant
subsidiary" of the Company as defined in Rule 1-02 of Regulation S-X under the
Securities Act and the Exchange Act.
"Maturity" when used with respect to any Security means the date on
which the principal of such Security becomes due and payable as therein
provided or as provided in the Indenture, whether at Stated Maturity, the
Offer Date, the Change of Control Purchase Date or the redemption date and
whether by declaration of acceleration, Offer in respect of Excess Proceeds,
Change of Control, call for redemption or otherwise.
"MLGA" means Morgan, Lewis, Githens, & Ahn, an investment
partnership.
"MLGA Fund II, L.P." means MLGA Fund II, L.P., a Connecticut limited
partnership controlled by certain principals of MLGA.
"Moody's" means Moody's Investors Service, Inc. or any successor
rating agency.
"Net Cash Proceeds" means (a) with respect to any Asset Sale by any
Person, the proceeds thereof in the form of cash or cash equivalents including
payments in respect of deferred payment obligations when received in the form
of, or stock or other assets when disposed for, cash or cash equivalents
(except to the extent that such obligations are financed or sold with recourse
to the Company or any Subsidiary) net of (i) brokerage commissions and other
reasonable fees and expenses (including fees and expenses of counsel and
investment bankers) related to such Asset Sale, (ii) provisions for all taxes
payable as a result of such Asset Sale, (iii) payments made to retire
Indebtedness where payment of such Indebtedness is secured by the assets or
properties the subject of such Asset Sale, (iv) amounts required to be paid to
any Person (other than the Company or any Subsidiary) owning a beneficial
interest in the assets subject to the Asset Sale and (v) appropriate amounts
to be provided by the Company or any Subsidiary, as the case may be, as a
reserve, in accordance with GAAP, against any liabilities associated with such
Asset Sale and retained by the Company or any Subsidiary, as the case may be,
after such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with
such Asset Sale, all as reflected in an officers' certificate delivered to the
Trustee and (b) with respect to any issuance or sale of Capital Stock or
options, warrants or rights to purchase Capital Stock, or debt securities or
Capital Stock that have been converted into or exchanged for Capital Stock, as
referred to under Section 10.9 the proceeds of such issuance or sale in the
form of cash or cash equivalents, including payments in respect of deferred
payment obligations when received in the form of, or stock or other assets
when disposed for, cash or cash equivalents (except to the extent that such
obligations are financed or sold with recourse to the Company or any
Subsidiary), net of attorney's fees, accountant's fees and brokerage,
consultation, underwriting and other fees and expenses actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"New Credit Facility" means the Loan and Security Agreement, dated
on or before the Closing Date, among the Company, Congress Financial
Corporation (Central) ("Congress"), as agent, and Congress and CoreStates
Bank, N.A., as lenders, as such agreement may be amended, renewed, extended,
substituted, refinanced, restructured, replaced, supplemented or otherwise
modified from time to time, whether by the same or any other lender or group
of lenders (including, without limitation, any successive renewals,
extensions, substitutions, refinancings, restructurings, replacements,
supplementations or other modifications of the foregoing), so long as the
collateral therein consists only of accounts receivable, inventory and fixed
assets or any combination thereof.
"Officers' Certificate" means a certificate signed by the Chairman
of the Board, Vice Chairman, President or a Vice President (regardless of Vice
Presidential designation), and by the Treasurer, Secretary or an Assistant
Secretary, of the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company or the Trustee, and who shall be reasonably acceptable
to the Trustee, including but not limited to an Opinion of Independent
Counsel.
"Opinion of Independent Counsel" means a written opinion by someone
who is not an employee or consultant of the Company and who shall be
reasonably acceptable to the Trustee.
"Outstanding" when used with respect to Securities means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(a) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities, or portions thereof, for whose payment or
redemption money in the necessary amount has been theretofore deposited with
the Trustee or any Paying Agent (other than the Company) in trust or set aside
and segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; provided, that if such
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture or provision therefor reasonably satisfactory to
the Trustee has been made;
(c) Securities, except to the extent provided in Sections
4.2 and 4.3, with respect to which the Company has effected defeasance or
covenant defeasance as provided in Article IV; and
(d) Securities in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to this Indenture,
other than any such Securities in respect of which there shall have been
presented to the Trustee and Company proof reasonably satisfactory to each of
them that such Securities are held by a bona fide purchaser in whose hands the
Securities are valid obligations of the Company; provided, however, that in
determining whether the Holders of the requisite principal amount of
Outstanding Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities owned by the
Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Securities which the Trustee knows to be so
owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
reasonable satisfaction of the Trustee the pledgee's right so as to act with
respect to such Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or such
other obligor.
"Pari Passu Indebtedness" means any Indebtedness of the Company that
is paripassu in right of payment to this Securities.
"Participants" means Persons for whom the Depositary holds
Securities.
"Paying Agent" means any Person authorized by the Company to pay the
principal, premium, if any, or interest on any Securities on behalf of the
Company.
"Permitted Holders" means MLGA Fund II, L.P. and any Affiliates
thereof.
"Permitted Indebtedness" means the following:
(i) Indebtedness of the Company under the New Credit
Facility under which the sum of (a) the aggregate principal amount of
revolving loan advances and (b) the aggregate stated amount of letters of
credit issued pursuant thereto, at any one time outstanding does not exceed
the greater of (x) $50.0 million and (y) an amount equal to (i) 60% of
Eligible Inventory consisting of finished goods and raw materials for such
finished goods, plus (ii) 45% of Eligible Inventory consisting of
work-in-process and semi-processed goods plus (iii) 85% percent of the Net
Amount of Eligible Accounts minus (iv) any Availability Reserves, as each of
the capitalized terms in this clause (y) is defined in the New Credit
Facility;
(ii) Indebtedness of the Company pursuant to the
Securities;
(iii) Indebtedness of the Company evidenced by the Existing
Notes to be redeemed pursuant to a notice of redemption given on the date
hereof;
(iv) Indebtedness of the Company owing to a Subsidiary;
provided that any Indebtedness of the Company owing to a Subsidiary is made
pursuant to an intercompany note and is subordinated in right of payment from
and after such time as the Securities shall become due and payable (whether at
Stated Maturity, acceleration or otherwise) to the payment and performance of
the Company's obligations under the Securities; provided, further, that any
disposition, pledge or transfer of any such Indebtedness to a Person (other
than the Company or another Subsidiary) shall be deemed to be an incurrence of
such Indebtedness by the Company not permitted by this clause (iv);
(v) obligations of the Company entered into in the ordinary
course of business pursuant to Interest Rate Agreements designed to protect
the Company or any Subsidiary against fluctuations in interest rates in
respect of Indebtedness of the Company or any of its Subsidiaries, which
obligations do not exceed the aggregate principal amount of such Indebtedness
and hedging arrangements that the Company enters into in the ordinary course
of business for the purpose of protecting its production against fluctuations
in commodity prices;
(vi) Indebtedness of the Company incurred (a) as a Purchase
Money Obligation, (b) under any Capital Lease Obligation, or (c) with respect
to letters of credit not otherwise permitted pursuant to clause (i) of this
definition of "Permitted Indebtedness" in a principal amount for clauses (a),
(b) and (c) in the aggregate not to exceed $10.0 million in any fiscal year of
the Company;
(vii) Indebtedness of the Company in addition to that
described in clauses (i) through (vi) of this definition of "Permitted
Indebtedness," not to exceed $10.0 million at any time outstanding in the
aggregate; provided that such amount shall be reduced by the amount, if any,
of Permitted Subsidiary Indebtedness then outstanding under clause (iii) of
the definition of "Permitted Subsidiary Indebtedness";
(viii) any renewals, extensions, substitutions, refundings,
refinancings or replacements (collectively, a "renewal/refinancing") of any
Indebtedness described in clauses (ii) and (vi) of this definition of
"Permitted Indebtedness," including any successive renewal/refinancings so
long as the aggregate principal amount of Indebtedness represented thereby is
not increased by such renewal/refinancing plus the lesser of (I) the stated
amount of any premium or other payment required to be paid in connection with
such renewal/refinancing pursuant to the terms of such Indebtedness or (II)
the amount of premium or other payment actually paid at such time to refinance
the Indebtedness, plus, in either case, the amount of expenses of the Company
incurred in connection with such renewal/refinancing and, in the case of Pari
Passu Indebtedness or Subordinated Indebtedness, such renewal/refinancing does
not reduce the Average Life to Stated Maturity or the Stated Maturity of such
Indebtedness;
(ix) Permitted Subsidiary Indebtedness that is permitted to
be incurred by a Subsidiary pursuant to clauses (ii) and (iii) under the
definition of "Permitted Subsidiary Indebtedness"; and
(x) Acquired Indebtedness that, after giving pro forma effect
thereto, and to the related acquisition as provided in Section 10.8(a),
results in (x) the Consolidated Fixed Coverage Ratio being less than the
Applicable Coverage Ratio (as defined in Section 10.8 hereof) but greater than
or equal to 1.75 to 1.00 and (y) the Consolidated Fixed Coverage Ratio
increasing as a consequence of such incurrence.
"Permitted Investment" means (i) Investments in any Wholly-Owned
Subsidiary; (ii) Indebtedness of a Subsidiary described under clause (ii) of
the definition of "Permitted Subsidiary Indebtedness" or Indebtedness of the
Company described under clauses (iv) of the definition of "Permitted
Indebtedness;" (iii) Temporary Cash Investments; (iv) Investments acquired by
the Company or any Subsidiary in connection with an Asset Sale permitted under
Section 10.12 to the extent such Investments are non-cash proceeds as
permitted under such covenant; and (v) other Investments in the aggregate not
to exceed $5.0 million.
"Permitted Subsidiary Indebtedness" means:
(i) Acquired Indebtedness of any Subsidiary whose
incurrence would be permitted under the test set forth in paragraph (x) of the
definition of "Permitted Indebtedness" as if calculated for such Subsidiary;
(ii) Indebtedness of a Wholly-Owned Subsidiary owing to the
Company or another Wholly-Owned Subsidiary; provided that any such
Indebtedness is made pursuant to an intercompany note in the form attached as
an exhibit to the Indenture; provided, further, that (x) any disposition,
pledge or transfer of any such Indebtedness to a Person (other than the
Company or a Wholly-Owned Subsidiary and other than any pledge as security for
the New Credit Facility) shall be deemed to be an incurrence of such
Indebtedness by the obligor not permitted by this clause (ii) and (y) any
transaction pursuant to which any Wholly-Owned Subsidiary, which has
Indebtedness owing to the Company or any other Wholly-Owned Subsidiary, ceases
to be a Wholly-Owned Subsidiary shall be deemed to be the incurrence of
Indebtedness by the Company or such other Wholly-Owned Subsidiary that is not
permitted under this clause (ii);
(iii) Indebtedness of a Subsidiary in addition to that
described in clauses (i) and (ii) of this definition of "Permitted Subsidiary
Indebtedness," not to exceed $10.0 million at any time outstanding in the
aggregate; provided, that such amount shall be reduced by the amount, if any,
of Permitted Indebtedness then outstanding under clause (vii) of the
definition of "Permitted Indebtedness"; and
(iv) any renewals, extensions, substitutions, refinancings
or replacements (collectively, a "debt refinancing") of any Indebtedness
described in clause (i) of this definition of "Permitted Subsidiary
Indebtedness," including any successive debt refinancings thereof, so long as
any such new Indebtedness shall be in a principal amount that does not exceed
the principal amount so refinanced, plus an amount equal to the lesser of (x)
the stated amount of any premium required to be paid in connection with any
such debt refinancing and (y) the amount of premium actually paid in
connection with any such debt refinancing plus the amount of expenses of such
Subsidiary incurred in connection therewith.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 3.6 in
exchange for a mutilated Security or in lieu of a lost, destroyed or stolen
Security shall be deemed to evidence the same debt as the mutilated, lost,
destroyed, or stolen Security.
"Preferred Stock" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated) of
such Person's preferred stock whether now outstanding, or issued after the
date of the Indenture, and including, without limitation, all classes and
series of preferred or preference stock.
"Public Equity Offering" means any underwritten public offering of
common stock of the Company pursuant to a registration statement filed
pursuant to the Securities Act which offering is consummated after the date of
the offering of Securities.
"Purchase Money Obligation" means any Indebtedness secured by a Lien
on assets related to the business of the Company or its Subsidiaries, and any
additions and accessions thereto, which are purchased by the Company or any
Subsidiary at any time after the Securities are issued; provided that (i) the
security agreement or conditional sales or other title retention contract
pursuant to which the Lien on such assets described above is created
(collectively a "Purchase Money Security Agreement") shall be entered into
within 90 days after the purchase or substantial completion of the
construction of such assets and shall at all times be confined solely to the
assets so purchased or acquired, any additions and accessions thereto and any
proceeds therefrom, (ii) at no time shall the aggregate principal amount of
the outstanding Indebtedness secured thereby be increased, except in
connection with the purchase of additions and accessions thereto and except in
respect of fees and other obligations in respect of such Indebtedness and
(iii) (A) the aggregate outstanding principal amount of Indebtedness secured
thereby (determined on a per asset basis in the case of any additions and
accessions) shall not at the time such Purchase Money Security Agreement is
entered into exceed 100% of the purchase price to the Company or any
Subsidiary of the assets subject thereto or (B) the Indebtedness secured
thereby shall be with recourse solely to the assets so purchased or acquired,
any additions and accessions thereto and any proceeds therefrom.
"Qualified Capital Stock" of any Person means any and all Capital
Stock of such Person other than Redeemable Capital Stock.
"Redeemable Capital Stock" means any Capital Stock that, either by
its terms or by the terms of any security into which it is convertible or
exchangeable or otherwise, is or upon the happening of any event or passage of
time would be, required to be redeemed prior to any Stated Maturity of the
principal of the Securities or is redeemable at the option of the holder
thereof at any time prior to any such Stated Maturity, or is convertible into
or exchangeable for debt securities at any time prior to any such Stated
Maturity at the option of the holder thereof.
"Redemption" means the redemption of the Existing Notes.
"Redemption Date" when used with respect to any Security to be
redeemed pursuant to any provision in this Indenture means the date fixed for
such redemption by or pursuant to this Indenture.
"Redemption Price" when used with respect to any Security to be
redeemed pursuant to any provision in this Indenture means the price at which
it is to be redeemed pursuant to this Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date means February 15 or August 15, as the case may be (whether or
not a Business Day), next preceding such Interest Payment Date.
"Responsible Officer" when used with respect to the Trustee means
any officer assigned to the Corporate Trust Office of the Trustee or any agent
of the Trustee appointed hereunder, including the chairman or vice chairman of
the board of directors or the executive committee of the board of directors,
the president, any vice president, any assistant vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer,
the cashier, any assistant cashier, any trust officer or assistant trust
officer, the controller or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above-
designated officers or any other officer appointed hereunder to whom any
corporate trust matter is referred because of his or her knowledge of and
familiarity with the particular subject.
"S&P" means Standard and Poor's Corporation or any successor rating
agency.
"Sale and Leaseback Transaction" means any transaction or series of
related transactions pursuant to which the Company or a Subsidiary sells or
transfers any property or asset in connection with the leasing, or the resale
against installment payments, of such property or asset to the Company or such
Subsidiary.
"Securities" has the meaning specified in the first recital of this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Indebtedness" means Indebtedness of the Company other than
Subordinated Indebtedness.
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 3.7.
"Stated Maturity" when used with respect to any Indebtedness or any
installment of interest thereon, means the dates specified in such
Indebtedness as the fixed date on which the principal of such Indebtedness or
such installment of interest is due and payable.
"Subordinated Indebtedness" means Indebtedness of the Company which
is by its terms expressly subordinated in right of payment to the Securities.
"Subsidiary" means any Person a majority of the equity ownership or
the Voting Stock of which is at the time owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or
more other Subsidiaries; provided that an Unrestricted Subsidiary shall not be
deemed a Subsidiary for purposes of the Indenture.
"Temporary Cash Investments" means (i) any evidence of Indebtedness,
maturing not more than two years after the date of acquisition, issued by the
United States of America, or an instrumentality or agency thereof and
guaranteed fully as to principal, premium, if any, and interest by the United
States of America; (ii) any certificate of deposit, maturing not more than two
years after the date of acquisition, issued by, or time deposit of, a
commercial banking institution that is a member of the Federal Reserve System
and that has combined capital and surplus and undivided profits of not less
than $500.0 million, whose debt has a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to Moody's or "A-1"
(or higher) according to S&P, (iii) commercial paper, maturing not more than
one year after the date of acquisition, issued by a corporation (other than
Affiliate or Subsidiary of the Company) organized and existing under the laws
of the United States of America with a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to Moody's or "A-1"
(or higher) according to S&P; (iv) any money market deposit accounts issued or
offered by (a) a domestic commercial bank having capital and surplus in excess
of $500.0 million or (b) a nationally recognized investment bank having
capital and surplus and undivided profits in excess of $150.0 million; (v)
repurchase obligations for underlying securities of the type described in
clause (i) above entered into with any financial institution designated as a
"Primary Dealer" by the Federal Reserve Bank of New York or any commercial
banking institution that satisfies the criteria set forth in clause (ii) of
this definition of "Temporary Cash Investments" as a counterparty; and (vi)
Eurodollar certificates of deposit maturing not more than two years after the
date of acquisition issued by, or any time deposit of, a commercial banking
institution outside the United States having equity capital and surplus and
undivided profits of not less than $250.0 million and foreign denominated
money market deposit accounts issued by a commercial banking institution
outside the United States having equity capital and surplus and undivided
profits of not less than $250.0 million.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture, until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended.
"Unrestricted Subsidiary" means any Subsidiary as to which all of
the following conditions apply: (a) neither the Company nor any of its
Subsidiaries provides credit support for any Indebtedness of such Subsidiary
(including any undertaking, agreement or instrument evidencing such
Indebtedness); (b) such subsidiary is not liable, directly or indirectly, with
respect to any Indebtedness other than Unrestricted Subsidiary Indebtedness;
(c) neither the Company nor any of its Subsidiaries has made an Investment in
such Unrestricted Subsidiary unless such Investment was not prohibited by the
provisions described under Section 10.9 hereunder; and (d) the Board of
Directors of the Company, as provided below, shall have designated such
Subsidiary to be an Unrestricted Subsidiary. Any such designation by the
Board of Directors shall be evidenced to the Trustee by filing with the
Trustee a Board Resolution giving effect to such designation and an Officers'
Certificate certifying that such designation complies with the foregoing
conditions. The Board of Directors may designate any Unrestricted Subsidiary
as a Subsidiary; provided, that (i) immediately after giving effect to such
designation, the Company could incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness) pursuant to the restrictions under Section 10.8
hereunder; and (ii) all Indebtedness of such Unrestricted Subsidiary shall be
deemed to be incurred on the date such Unrestricted Subsidiary becomes a
Subsidiary.
"Unrestricted Subsidiary Indebtedness" of any Unrestricted
Subsidiary means Indebtedness of such Unrestricted Subsidiary (a) as to which
neither the Company nor any Subsidiary is directly or indirectly liable (by
virtue of the Company or any such Subsidiary being the primary obligor on,
guarantor of, or otherwise liable in any respect to, such Indebtedness), and
(b) which, upon the occurrence of a default with respect thereto, does not
result in, or permit any holder of any Indebtedness of the Company or any
Subsidiary to declare, a default on such Indebtedness of the Company or any
Subsidiary or cause the payment thereof to be accelerated or payable prior to
its stated maturity.
"Voting Stock" means stock of the class or classes pursuant to which
the holders thereof have the general voting power under ordinary circumstances
to elect at least a majority of the board of directors, managers or trustees
of a corporation (irrespective of whether or not at the time stock of any
other class or classes shall have or might have voting power by reason of the
happening of any contingency).
"Wholly-Owned Subsidiary" means a Subsidiary all the Capital Stock
(other than directors' qualifying shares) of which is owned by the Company or
another Wholly-Owned Subsidiary.
"1989 Acquisition" means the acquisition in 1989 of the Company by
MLGA and its Affiliates, together with management of the Company, in a
leveraged buy-out.
Section 1.2. Other Definitions.
Term Defined in Section
- ----------------------------------- ------------------
"Act" 1.5
"Applicable Coverage Ratio" 10.8
"Applicable Premium 10.14
"Applicable Spread 10.14
"Certificated Notes 3.1
"Change of Control Offer" 10.13
"Change of Control Purchase Date" 10.13
"Change of Control Purchase Notice" 10.13
"Change of Control Purchase Price" 10.13
"Closing Date" 3.1
"covenant defeasance" 4.3
"Defaulted Interest" 3.7
"defeasance" 4.2
"Defeasance Redemption Date" 4.4
"Defeased Securities" 4.1
"Deficiency" 10.12
"Depositary" 2.1
"event of default" 10.9
"Excess Proceeds" 10.12
"Global Note" 3.1
"Global Note Holder" 3.1
"Holdings" 8.1
"incur" 10.8
"Offer" 10.12
"Offer Date" 10.12
"Offered Price" 10.12
"refinancing" 10.9
"Required Filing Dates" 10.17
"Security Amount" 10.12
"Security Register" 3.5
"Security Registrar" 3.5
"Special Payment Date" 3.7
"Surviving Entity" 8.1
"Treasury Rate" 10.14
"U.S. Government Obligations" 4.4
Section 1.3. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company and each
other obligor of the Securities shall furnish to the Trustee an Officers'
Certificate to the effect that all conditions precedent, if any, provided for
in this Indenture (including any covenant compliance which constitutes a
condition precedent) relating to the proposed action have been complied with
and an Opinion of Counsel to the effect that
in the opinion of such counsel all such conditions precedent, if any, have
been complied with, except that, in the case of any such application or
request as to which the furnishing of any certificates and/or opinions is
specifically required by any provision of this Indenture, relating to such
particular application or request, no additional certificate or opinion need
be furnished.
Every certificate or Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture (other than
certificates provided pursuant to Section 10.18 of this Indenture) shall
include:
(a) a statement to the effect that each individual or firm
signing such certificate or opinion has read such covenant or condition and
the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained
in such certificate or opinion are based;
(c) a statement to the effect that, in the opinion of each
such individual or such firm, he has made such examination or investigation as
is necessary to enable him or them to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual or such firm, such condition or covenant has been complied with.
Section 1.4. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such Person may
certify or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company or other
obligor of the Securities may be based, insofar as it relates to legal
matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to the matters
upon which his certificate or opinion is based are erroneous. Any certificate
or opinion of such an officer or of counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company or other obligor of
the Securities with respect to such factual matters and which contains a
statement to the effect that the information with respect to such factual
matters is in the possession of the Company or other obligor of the
Securities, unless such officer or counsel knows that the certificate or
opinion or representations with respect to such matters are erroneous.
Opinions of Counsel required to be delivered to the Trustee may have
qualifications customary for opinions of the type required and counsel
delivering such Opinions of Counsel may rely on certificates of the Company or
government or other officials customary for opinions of the type required,
including certificates certifying as to matters of fact, including that
various financial covenants have been complied with.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.5. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or
taken by Holders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
(b) The ownership of Securities shall be proved by the Security
Register.
(c) Any request, demand, authorization, direction, notice,
consent, waiver or other Act by the Holder of any Security shall bind every
future Holder of the same Security or the Holder of every Security issued upon
the transfer thereof or in exchange therefor or in lieu thereof, in respect of
anything done, suffered or omitted to be done by the Trustee, any Paying Agent
or the Company or any other obligor in reliance thereon, whether or not
notation of such action is made upon such Security.
(d) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him the execution thereof.
Where such execution is by a signer acting in a capacity other than his
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority. The fact and date of the execution of any
such instrument or writing, or the authority of the Person executing the same,
may also be proved in any other manner which the Trustee deems sufficient.
Section 1.6. Notices, etc., to Trustee and the Company.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:
(a) the Trustee by any Holder or by the Company or any
other obligor of the Securities shall be sufficient for every purpose
hereunder if made, given, furnished or filed, in writing, by first-class mail
postage prepaid (return receipt requested) or delivered in person or by
recognized overnight courier to or with the Trustee at 101 West Washington
Street, Suite 655 South, Indianapolis, Indiana 46255, Attention: Corporate
Trust Administration or at any other address furnished in writing prior
thereto to the Holders, the Company or any other obligor of the Securities by
the Trustee, or delivered by facsimile transmission to (317) 267- 7658,
Attention: Corporate Trust Administration or at any other facsimile number
furnished in writing prior thereto to the Holders, the Company or any other
obligor of the Securities by the Trustee, provided that a copy of any
facsimile delivery is delivered by mail or courier in the manner and to the
address described above not later than five Business Days after the delivery
by facsimile; or
(b) the Company shall be sufficient for every purpose
(except as provided in Section 5.1(c)) hereunder if in writing and mailed,
first-class postage prepaid or delivered by recognized overnight courier, to
the Company addressed to it at 1020 West Park Avenue, Kokomo, Indiana
46904-9013, Attention: Chief Financial Officer, or at any other address
previously furnished in writing to the Trustee by the Company or delivered by
facsimile transmission to (317) 456-6985, Attention: Chief Financial Officer,
or at any other facsimile number furnished in writing prior thereto to the
Holders, the Trustee or any other obligor of the Securities by the Company,
provided that a copy of any facsimile delivery is delivered by mail or courier
in the manner and to the address described above not later than five Business
Days after the delivery by facsimile, with a copy to Ice Miller Donadio &
Ryan, One American Square, Box 82001, Indianapolis, Indiana 46282-0002,
Attention: Stephen J. Hackman, or delivered by facsimile transmission to (317)
236-2219, Attention: Stephen J. Hackman or at any other facsimile number
furnished in writing prior thereto to the Holders, the Trustee, the Company or
any other obligor of the Securities by Ice Miller, Donadio & Ryan, provided
that a copy of any facsimile delivery is delivered by mail or courier in the
manner and to the address described above not later than five Business Days
after the delivery by facsimile.
Section 1.7. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each
Holder affected by such event, at such Holder's address as it appears in the
Security Register, not later than the latest date, and not earlier than the
earliest date, prescribed for the giving of such notice. In any case where
notice to Holders is given by mail, neither the failure to mail such notice,
nor any defect in any notice so mailed, to any particular Holder shall affect
the sufficiency of such notice with respect to other Holders. Any notice when
mailed to a Holder in the aforesaid manner shall be conclusively deemed to
have been received by such Holder whether or not actually received by such
Holder. Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause, it shall be impracticable to mail notice of any
event as required by any provision of this Indenture, then any method of
giving such notice as shall be reasonably satisfactory to the Trustee shall be
deemed to be a sufficient giving of such notice.
Section 1.8. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with any
provision of the Trust Indenture Act or another provision which is required or
deemed to be included in this Indenture by any of the provisions of the Trust
Indenture Act, the provision or requirement of the Trust Indenture Act shall
control. If any provision of this Indenture modifies or excludes any
provision of the Trust Indenture Act that may be so modified or excluded, such
provision of the Trust Indenture Act shall be deemed to apply to this
Indenture as so modified or to be excluded, as the case may be.
Section 1.9. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
Section 1.10. Successors and Assigns.
All covenants and agreements in this Indenture by the Company and
any other obligor of the Securities shall bind their successors and assigns,
whether so expressed or not.
Section 1.11. Separability Clause.
In case any provision in this Indenture or in the Securities shall
be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 1.12. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person (other than the parties hereto and their successors
hereunder, any Paying Agent and the Holders) any benefit or any legal or
equitable right, remedy or claim under this Indenture.
Section 1.13. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT
GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF).
Section 1.14. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date,
Maturity or Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal or premium, if any, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the Interest Payment Date or Redemption Date, or at
Maturity or the Stated Maturity, and no interest shall accrue with respect to
such payment for the period from and after such Interest Payment Date,
Redemption Date, Maturity or Stated Maturity, as the case may be, to the next
succeeding Business Day.
Section 1.15. Schedules.
All schedules attached hereto are by this reference made a part with
the same effect as if herein set forth in full.
Section 1.16. Counterparts.
This Indenture may be executed in any number of counterparts, each
of which shall be an original; but such counterparts shall together constitute
but one and the same instrument.
ARTICLE II
SECURITY FORMS
Section 2.1. Forms Generally.
(a) The Securities will initially be issued in the form of one
or more global notes (the "Global Note"). The Global Note will be deposited
on the date of the closing of the sale of the Securities offered hereby (the
"Closing Date") with, or on behalf of, The Depository Trust Company or its
successors and assigns (the "Depositary") and registered in the name of Cede &
Co., as nominee of the Depositary (such nominee being referred to herein as
the "Global Note Holder").
(b) Notwithstanding Section 2.1(a), Securities that are issued
in accordance with Section 2.1(c) will be issued in the form of registered
definitive certificates (the "Certificated Notes"). Such Certificated Notes
may, unless the Global Note has previously been exchanged for Certificated
Notes, be exchanged for an interest in the Global Note representing the
principal amount of Securities being transferred.
(c) Any person owning a beneficial interest in the Global Note
may, upon request to the Trustee, exchange such beneficial interest for
Securities in the form of Certificated Notes. Upon any such issuance, the
Trustee is required to register such Certificated Notes in the name of, and
cause the same to be delivered to, such Person or Persons (or the nominee of
any thereof). In addition, if (i) the Company notifies the Trustee in writing
that the Depositary is no longer willing or able to act as a depositary and
the Company is unable to locate a qualified successor within 90 days, or (ii)
the Company, at its option, notifies the Trustee in writing that it elects to
cause the issuance of Securities in the form of Certificated Notes under the
Indenture, then, upon surrender by the Global Note Holder of its Global Note,
Certificated Notes will be issued to each Person that the Global Note Holder
and the Depositary identify as being the beneficial owner of the related
Securities. If the Company determines to replace the Depositary with another
qualified securities depository, the Company shall prepare or cause to be
prepared a new fully-registered Global Note, registered in the name of such
successor or substitute securities depositary or its nominee, or make such
other arrangements as are acceptable to the Company, the Trustee and the
securities depository and not inconsistent with the terms of this Indenture.
(d) Neither the Company nor the Trustee will be liable for any
delay by the Global Note Holder or the Depositary in identifying the
beneficial owners of the Securities, and the Company and the Trustee may
conclusively rely on, and will be protected in relying on, instructions from
the Global Note Holder or the Depositary for all purposes.
(e) Securities and the Trustee's certificates of authentication
thereof shall be in substantially the forms set forth in this Article II, with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture and may have such letters, numbers
or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities
exchange, any organizational document or governing instrument or applicable
law or as may, consistently herewith, be determined by the officers executing
such Securities, as evidenced by their execution of the Securities. Any
portion of the text of any Security may be set forth on the reverse thereof,
with an appropriate reference thereto on the face of the Security.
(f) The Certificated Notes shall be printed, lithographed or
engraved or produced by any combination of these methods or may be produced in
any other manner permitted by the rules of any securities exchange on which
the Securities may be listed, all as determined by the officers executing such
Securities, as evidenced by their execution of such Securities.
Section 2.2. Form of Face of Security.
The form of the face of the Securities shall be substantially as
follows:
HAYNES INTERNATIONAL, INC.
11e% Senior Notes due 2004
CUSIP No. 420877 AD4 $140,000,000
HAYNES International, Inc., a Delaware corporation (herein called
the "Company," which term includes any successor), for value received, hereby
promises to pay to or registered assigns, the principal sum of
$140,000,000 United States dollars on September 1, 2004, at the office or
agency of the Company referred to below, and to pay interest thereon from
August 23, 1997 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, as the case may be, semiannually
on March 1 and September 1 of each year commencing March 1, 1997 at the rate
of 11e% per annum, in United States dollars, until the principal hereof is
paid or duly provided for.
The interest so payable, 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 (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be February 15 or August 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so paid, or duly provided for, and interest on such defaulted
interest at the interest rate borne by the Securities, to the extent lawful,
shall forthwith cease to be payable to the Holder in whose name such Security
is registered as of such Regular Record Date, and may be paid on the Special
Payment Date to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date to be fixed by the Trustee (and for which notice shall be given to
Holders of Securities not less than 10 days prior to such Special Record Date)
or may be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.
Payment of the principal of, premium, if any, and interest on this
Security will be made at the office or agency of the Company maintained for
that purpose, or at such other office or agency of the Company as may be
maintained 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 payment of interest may be made at the
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option of the Company by check mailed to the address of the Person entitled
thereto as such address shall appear on the Security Register. Interest shall
be computed on the basis of a 360-day year of twelve 30-day months.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof or by the
authenticating agent appointed as provided in the Indenture by manual
signature, this Security shall not be entitled to any benefit under the
Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed by the manual or facsimile signature of its authorized officers
and its corporate seal to be affixed or reproduced hereon.
Dated: August 23, 1996 HAYNES INTERNATIONAL, INC.
By:
Attest: [SEAL]
Secretary
Section 2.3. Form of Reverse of Security.
The form of the reverse of the Securities shall be substantially as
follows:
This Security is one of the duly authorized issue of Securities of
the Company designated as its 11 % Senior Notes due 2004 (herein called the
"Securities"), limited (except as otherwise provided in the Indenture referred
to below) in aggregate principal amount to $140.0 million which may be issued
under and are subject to the terms of an indenture (herein called the
"Indenture") dated as of August 23, 1996 between the Company and National City
Bank, as trustee (together with any successor trustee under the Indenture, the
"Trustee"), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties, obligations and immunities thereunder of the Company, the
Trustee and the Holders, and of the terms upon which the Securities are, and
are to be, authenticated and delivered.
The Indenture contains provisions for defeasance at any time of (a)
the entire Indebtedness on this Security and (b) certain covenants and related
Defaults and Events of Default thereunder, in each case upon compliance with
certain conditions set forth therein.
The Securities are subject to redemption at any time on or after
September 1, 2000, at the option of the Company, in whole or in part, on not
less than 30 nor more than 60 days' prior notice in amounts of $1,000 or an
integral multiple thereof at the following redemption prices (expressed as
percentages of the principal amount), if redeemed during the 12-month period
beginning September 1 of the years indicated below:
Redemption
Year Price
- ---- -----------
2000 105.813%
2001 102.906%
and thereafter at 100% of the principal amount, in each case together with
accrued and unpaid interest, if any, to the redemption date (subject to the
right of holders of record on relevant record dates to receive interest due on
an interest payment date).
In addition, prior to September 1, 1999, in the event one or more
Public Equity Offerings of the Company are consummated, the Company may redeem
in the aggregate up to a maximum of 35% of the initial aggregate principal
amount of the Securities with the net proceeds thereof at a Redemption Price
equal to 111.625% of the principal amount thereof plus accrued and unpaid
interest to the Redemption Date; provided that, after giving effect thereto,
--------
at least $85.0 million aggregate principal amount of Securities remains
outstanding.
If less than all of the Securities are to be redeemed, the Trustee
shall select the Securities or portions thereof to be redeemed pro rata, by
lot or by any other method the Trustee shall deem fair and reasonable,
provided that, any redemption pursuant to the provisions relating to a sale of
-
the Common Stock of the Company pursuant to one or more Public Equity
Offerings shall be made on a pro rata basis or on as nearly a pro rata basis
as practicable (subject to any procedures of the Depositary).
If a Change of Control shall occur at any time, then each holder of
Securities shall have the right to require that the Company purchase such
holder's Securities in whole or in part in integral multiples of $1,000, at a
purchase price in cash in an amount equal to 101% of the principal amount of
such Securities, plus accrued and unpaid interest, if any, to the date of
purchase pursuant to the offer procedures set forth in the Indenture.
In addition, if a Change of Control shall occur at any time, then
the Company shall, within 180 days after a Change of Control and upon not less
than 30 nor more than 60 days' prior notice to each holder of Securities, have
the right to purchase the Securities, in whole or in part, at a redemption
price equal to the sum of (i) the then outstanding principal amount plus (ii)
accrued and unpaid interest, if any, to the Redemption Date, plus (iii) a
premium defined as the greater of (a) 1.0% of the then outstanding principal
amount of the Securities and (b) the excess of (1) the present value of the
required payments on the Securities, computed using a discount rate equal to
the Treasury Rate plus 75 basis points, over (2) the then outstanding
principal amount of the Securities.
Under certain circumstances, in the event the Net Cash Proceeds that
are received by the Company from any Asset Sale, and that are not applied
within the time periods set forth in the Indenture to repay or prepay
permanently any Indebtedness under the New Credit Facility then outstanding or
invested in properties or assets that replace the assets sold or that are used
in the businesses of the Company or its Subsidiaries, equal or exceed $5.0
million, the Company will be required to offer, pursuant to the offer
procedures set forth in the Indenture, to apply such proceeds to the repayment
of the Securities at 100% of the principal amount of such Securities, plus
accrued and unpaid interest, if any, to the date of purchase and to the
repayment of certain Indebtedness ranking pari passu with the Securities.
---- -----
In the case of any redemption of Securities, interest installments
whose Stated Maturity is on or prior to the Redemption Date will be payable to
the Holders of such Securities of record as of the close of business on the
relevant Regular Record Date or Special Record Date referred to on the face
hereof. Securities (or portions thereof) for whose redemption and payment
provision is made in accordance with the Indenture shall cease to bear
interest from and after the Redemption Date.
In the event of redemption of this Security in part only, a new
Security or Securities for the unredeemed portion hereof shall be issued in
the name of the Holder hereof upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the principal
amount of all the Securities may be declared due and payable in the manner and
with the effect provided in the Indenture.
The Indenture permits, with certain exceptions (including certain
amendments permitted without the consent of any Holders) as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Holders under the Indenture and the
Securities at any time with the consent of the Holders of not less than a
majority in aggregate principal amount of the Securities at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
not less than a majority in aggregate principal amount of the Securities at
the time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and the
Securities and certain past Defaults under the Indenture and their
consequences. Any such consent or waiver by or on behalf of the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof
whether or not notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company or any other obligor under the Securities (in the event such other
obligor is obligated to make payments in respect of the Securities), which is
absolute and unconditional, to pay the principal of, premium, if any, and
interest on this Security at the times, place, and rate, and in the coin or
currency, herein prescribed.
As set forth in, and subject to, the provisions of the Indenture, no
Holder of any Security will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless (a) such Holder
shall have previously given to the Trustee written notice of a continuing
Event of Default, (b) the Holders of not less than 25% in principal amount of
the Outstanding Securities shall have made written request, and offered
reasonable indemnity, to the Trustee to institute such proceeding as trustee,
(c) the Trustee shall not have received from the Holders of a majority in
principal amount of the Outstanding Securities a direction inconsistent with
such request and (d) the Trustee shall have failed to institute such
proceeding within 60 days; provided, however, that such limitations do not
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apply to a suit instituted by the Holder hereof for the enforcement of payment
of the principal of (and premium, if any) or any interest on this Security on
or after the respective due dates expressed herein.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable on the
Security Register of the Company, upon surrender of this Security for
registration of transfer at the office or agency of the Company maintained for
such purpose or at such other office or agency of the Company as may be
maintained for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar duly executed by, the Holder hereof or his attorney duly authorized
in writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees.
The Securities are issuable only in registered form without coupons
in denominations of $1,000 and any integral multiple thereof. As provided in
the Indenture and subject to certain limitations therein set forth, the
Securities are exchangeable for a like aggregate principal amount of
Securities of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any registration of transfer or
exchange or redemption of Securities, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security is overdue, and none of
the Company, the Trustee nor any agent shall be affected by notice to the
contrary.
Upon any consolidation or merger, or any sale, assignment,
conveyance, transfer or disposition (other than pursuant to a lease) of all or
substantially all of the properties and assets of the Company in accordance
with the Indenture, subject to the terms and conditions of the Indenture, the
successor Person to such transaction shall become the obligor on this
Security, and the Company shall be discharged from all obligations and
covenants under this Security and the Indenture.
All terms used in this Security which are defined in the Indenture
and not otherwise defined herein shall have the meanings assigned to them in
the Indenture.
The Company will furnish to any holders of the Securities upon
written request and without charge a copy of the Indenture. All requests may
be made to Haynes International, Inc., 1020 West Park Avenue, Kokomo, Indiana
46904-9013.
Section 2.4. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be included on the
form of the face of the Securities substantially in the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
This is one of the Securities referred to in the within-mentioned
Indenture.
National City Bank,
as Trustee
By:
Authorized Signatory
ARTICLE III
THE SECURITIES
Section 3.1. Title and Terms.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to $140,000,000 in
principal amount of Securities, except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of,
other Securities pursuant to Section 3.3, 3.4, 3.5, 3.6, 9.6, 10.12, 10.13,
10.14 or 11.8.
The Securities shall be known and designated as the "11 % Senior
Notes due 2004" of the Company. The Stated Maturity of the Securities shall
be September 1, 2004, and the Securities shall bear interest at the rate of 11
% per annum from August 23, 1996 or from the most recent Interest Payment Date
to which interest has been paid or duly provided for, as the case may be,
payable commencing on March 1, 1997 and semiannually thereafter on March 1 and
September 1 in each year, until the principal thereof is paid or duly provided
for. Interest on any overdue principal, interest (to the extent lawful) or
premium, if any, shall be payable as provided in Section 3.7.
The principal of, premium, if any, and interest on the Securities
shall be payable at the office or agency of the Company maintained for such
purpose, or at such other office or agency of the Company as may be maintained
for such purpose; provided, however, that at the option of the Company
interest may be paid by check mailed to addresses of the Persons entitled
thereto as such addresses as shall appear on the Security Register.
The Securities shall be redeemable as provided in Article XI.
At the election of the Company, the entire indebtedness on the
Securities or certain of the Company's obligations and covenants and certain
Defaults and Events of Default thereunder may be defeased as provided in
Article IV.
Section 3.2. Denominations.
The Securities shall be issuable only in registered form without
coupons and only in denominations of $1,000 and any integral multiple thereof.
Section 3.3. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by one of
its Chairman of the Board, Vice-Chairman, President or one of its Vice
Presidents under its corporate seal reproduced thereon attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the
Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities
or did not hold such offices on the date of such Securities.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities executed by the Company
to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such Company Order shall authenticate and deliver such Securities as
provided in this Indenture and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication, substantially in the form provided for herein,
duly executed by the Trustee by manual signature of an authorized signatory,
and such certificate upon any Security shall be conclusive evidence, and the
only evidence, that such Security has been duly authenticated and delivered
hereunder and is entitled to the benefits of this Indenture.
In case the Company or any of its Subsidiaries, pursuant to Article
VIII, shall be consolidated or merged with or into any other Person or shall
sell, convey, assign, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets to any Person or group of
affiliated Persons, and the successor Person resulting from such
consolidation, or surviving such consolidation or merger, or into which the
Company shall have been merged or consolidated, or the successor Person which
shall have received a conveyance, transfer, lease or other disposition as
aforesaid, shall have executed an indenture supplemental hereto with the
Trustee pursuant to Article VIII, any of the Securities authenticated or
delivered prior to such consolidation, merger, conveyance, transfer, lease or
other disposition may, from time to time, at the request of the successor
Person, be exchanged for other Securities executed in the name of the
successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Securities
surrendered for such exchange and of like principal amount; and the Trustee,
upon Company Request of the successor Person, shall authenticate and deliver
Securities as specified in such request for the purpose of such exchange. If
Securities shall at any time be authenticated and delivered in any new name of
a successor Person pursuant to this Section in exchange or substitution for or
upon registration of transfer of any Securities, such successor Person, at the
option of a Holder but without expense to such Holder, shall provide for the
exchange of all Securities at the time Outstanding held by such Holder for
Securities authenticated and delivered in such new name.
The Trustee may appoint an authenticating agent reasonably
acceptable to the Company to authenticate Securities on behalf of the Trustee.
Unless limited by the terms of such appointment, an authenticating agent may
authenticate Securities whenever the Trustee may do so. Each reference in
this Indenture to authentication by the Trustee includes authentication by
such agent. An authenticating agent has the same rights as any Security
Registrar or Paying Agent to deal with the Company and its Affiliates.
Section 3.4. Temporary Securities.
Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten or otherwise
produced, in any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as conclusively evidenced by
their execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for such purpose
pursuant to Section 10.2 (or in accordance with Section 3.3, in the case of
the initial Securities), without charge to the Holders thereof. Upon
surrender for cancellation of any one or more temporary Securities, the
Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Securities of
authorized denominations. Until so exchanged, the temporary Securities shall
in all respects be entitled to the same benefits under this Indenture as
definitive Securities.
Section 3.5. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee, or such other office as the Trustee may designate, a register
(the register maintained in such office being herein sometimes referred to as
the "Security Register") in which, subject to such reasonable regulations as
the Security Registrar may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee or an
agent thereof or of the Company shall initially be the "Security Registrar"
for the purpose of registering Securities and transfers of Securities as
herein provided. The Company may appoint one or more co- registrars.
Subject to the requirements of applicable law, upon surrender for
registration of transfer of any Security at the office or agency of the
Company designated pursuant to Section 10.2, the Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of any authorized
denomination or denominations, of a like aggregate principal amount.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations, of a like
aggregate principal amount, upon surrender of the Securities to be exchanged
at such office or agency. Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company, evidencing the
same Indebtedness, and entitled to the same benefits under this Indenture, as
the Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer, or for exchange or redemption, shall (if so required by the Company
or the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar, duly
executed by the Holder thereof or such Holder's attorney duly authorized in
writing.
No service charge shall be made to a Holder for any registration of
transfer, exchange or redemption of Securities, but the Company may require
payment of a sum sufficient to pay all documentary, stamp or similar issue or
transfer taxes or other governmental charges that may be imposed in connection
with any registration of, transfer, exchange or redemption of Securities,
other than exchanges pursuant to Section 3.3, 3.4, 3.6, 9.6, 10.12, 10.13,
10.14 or 11.8 not involving any transfer.
The Company shall not be required (a) to issue, register the
transfer of or exchange any Security during a period beginning at the opening
of business (i) 15 days before the mailing of a notice of redemption of the
Securities selected for redemption under Section 11.4 and ending at the close
of business on the day of such mailing or (ii) 15 days before an Interest
Payment Date and ending on the close of business on the Interest Payment Date,
or (b) to register the transfer of or exchange any Security selected for
redemption in whole or in part, except the unredeemed portion of Securities
being redeemed in part.
Section 3.6. Mutilated, Destroyed, Lost and Stolen Securities.
If (a) any mutilated Security is surrendered to the Trustee, or (b)
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Security, and there is delivered to the Company, any other
obligor under the Securities and the Trustee, such security and/or indemnity,
in each case as may be required by them to save each of them harmless, then,
in the absence of notice to the Company, any other obligor under the
Securities or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and upon its written request the Trustee
shall authenticate and deliver, in exchange for any such mutilated Security or
in lieu of any such destroyed, lost or stolen Security, a replacement Security
of like tenor and principal amount, bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a replacement Security, pay such Security.
Upon the issuance of any replacement Securities under this Section,
the Company may require the payment of a sum sufficient to pay all
documentary, stamp or similar issue or transfer taxes or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee) connected therewith.
Every replacement Security issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company and any other obligor of the
Securities, whether or not the destroyed, lost or stolen Security shall be at
any time enforceable by anyone, and shall be entitled to all benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities.
Section 3.7. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or
duly provided for, on the Stated Maturity of such interest shall be paid to
the Person in whose name that Security is registered at the close of business
on the Regular Record Date for such interest payment.
Any interest on any Security which is payable, but is not paid or
duly provided for on the Stated Maturity of such interest (or within 15 days
after the Stated Maturity of such interest) and interest on such defaulted
interest at the then applicable interest rate borne by the Securities, to the
extent lawful (such defaulted interest and interest thereon herein
collectively called "Defaulted Interest") shall forthwith cease to be payable
to the Holder in whose name such Security is registered as of the Regular
Record Date; and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Subsection (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities are registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security and the date of the
proposed payment (the "Special Payment Date"), and at the same time the
Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit at least
one Business Day prior to the Special Payment Date, such money when deposited
to be held in trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Subsection provided. Such notice shall be received by the
Trustee no less than 30 days prior to the Special Payment Date. Thereupon the
Trustee shall fix a Special Record Date for the payment of such Defaulted
Interest which Special Record Date shall be not more than 15 days and not less
than 10 days prior to the Special Payment Date and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee
shall promptly notify the Company in writing of such Special Record Date and
Special Payment Date. In the name and at the expense of the Company, the
Trustee shall cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date and Special Payment Date therefor to be mailed,
certified or registered (return receipt requested) first-class postage
prepaid, to each Holder at his address as it appears in the Security Register,
not less than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the
Persons in whose names the Securities are registered on such Special Record
Date and shall no longer be payable pursuant to the following Subsection (b).
(b) The Company may make payment to the Persons in whose
name the Securities are registered at the close of business on the Special
Record Date and Special Payment Date of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by such exchange, unless, after written notice given by the Company
to the Trustee of the proposed payment pursuant to this Subsection, such
manner of payment shall not be deemed practicable by the Trustee (acting
reasonably). The Trustee shall give prompt written notice to the Company of
any such determination.
Subject to the foregoing provisions of this Section 3.7, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Section 3.8. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name any Security is registered as the owner of such
Security for the purpose of receiving payment of principal of, premium, if
any, and (subject to Section 3.7) interest on such Security and for all other
purposes whatsoever, whether or not such Security is overdue, and none of the
Company, the Trustee or any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Section 3.9. Cancellation.
All Securities surrendered for payment, purchase, redemption,
registration of transfer or exchange shall be delivered to the Trustee and, if
not already canceled, shall be promptly canceled by it. The Company or any
Subsidiary may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
or any such Subsidiary may have acquired in any manner whatsoever, and all
Securities so delivered shall be promptly canceled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
canceled as provided in this Section, except as expressly permitted by this
Indenture. All canceled Securities held by the Trustee shall be destroyed in
accordance with its customary procedures and certification of their
destruction delivered to the Company unless by a Company Order received by the
Trustee prior to such destruction the Company shall direct that the canceled
Securities be returned to it. The Trustee shall provide the Company a list of
all Securities that have been canceled from time to time as requested by the
Company.
Section 3.10. Computation of Interest.
Interest on the Securities shall be computed on the basis of a
360-day year of twelve 30-day months.
Section 3.11. Depositary Procedures.
(a) The following procedures will be established: (i) upon
deposit of the Global Note, the Depositary will credit the accounts of
Participants designated by the underwriters of the Securities with portions of
the principal amount of the Global Note, and (ii) ownership of the Securities
evidenced by the Global Note will be shown on, and the transfer of ownership
thereof will be effected only through, records maintained by the Depositary
(with respect to the interests in the Depositary's Participants), the
Depositary's Participants and the Depositary's indirect Participants.
(b) So long as the Global Note Holder is the registered holder
of the Global Note, the Global Note Holder will be considered for all purposes
under the Indenture as the sole and absolute owner of the Securities evidenced
by the Global Note. Beneficial owners of Securities evidenced by the Global
Note will not be considered the owners or holders thereof under the Indenture
for any purpose. Without limiting the foregoing sentence, neither the Company
nor the Trustee will have any responsibility or liability for (i) any aspect
of the records of the Depositary, (ii) maintaining, supervising, or reviewing
any records of the Depositary relating to the Securities, (iii) the selection
by the Depositary of beneficial interests in the Securities to be redeemed in
part or (iv) the payment to any beneficial owner or other Person, other than
the Depositary, of any amount with respect to principal of, premium, if any,
or interest with respect to the Securities.
Section 3.12. Book-Entry.
Payments in respect of the principal of, premium, if any, and
interest on any Securities registered in the name of the Global Note Holder on
the applicable record date will be payable by an office or agency established
by the Company under the Indenture for such purpose to or at the direction of
the Global Note Holder in its capacity as the holder of the Global Note. The
Company and the Trustee may treat the Persons in whose name Securities,
including the Global Note, are registered as the owners thereof for the
purpose of receiving such payments. Consequently, neither the Company nor the
Trustee has or will have any responsibility or liability for the payment of
such amounts to beneficial owners of Securities. Payments by the Participants
to the beneficial owners of Securities will be governed by standing
instructions and customary practice and will be the responsibility of the
Depositary's Participants.
Section 3.13. Same-Day Settlement and Payment.
Payments in respect of the Securities represented by the Global Note
(including principal, premium, if any, interest and liquidated damages, if
any) shall be made in immediately available funds to the accounts specified by
the Global Note Holder. With respect to Certificated Notes, the Paying Agent
will make all payments of principal, premium, if any, interest, and liquidated
damages, if any, in immediately available funds to the accounts specified by
the Holders thereof, either at the office or agency of a Paying Agent or by
mailing a check to each such Holder's registered address. The Securities
represented by the Global Note are expected to trade in the Depositary's
Same-Day Funds Settlement System, and secondary market trading activity in
such Securities will, therefore, be required by the Depositary to be settled
in immediately available funds.
Section 3.14. Legends.
All Global Notes shall bear the following legend:
Unless this certificate is presented by an authorized representative
of the Depository Trust Company (together with its successors and assigns, the
"Depositary") to the Company or its agent for registration of transfer,
exchange, or payment and any certificate issued is registered in the name of
Cede & Co. or to such other entity as is requested by an authorized
representative of the Depositary (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of the
Depositary), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede
& Co., has an interest herein.
ARTICLE IV
DEFEASANCE AND COVENANT DEFEASANCE
Section 4.1. Company's Option to Effect Defeasance or Covenant
Defeasance.
The Company may, at its option by Board Resolution, at any time,
with respect to the Securities, elect to have either Section 4.2 or Section
4.3 be applied to all of the Outstanding Securities (the "Defeased
Securities"), upon compliance with the conditions set forth below in this
Article IV.
Section 4.2. Defeasance and Discharge.
Upon the Company's exercise under Section 4.1 of the option
applicable to this Section 4.2, both the Company and any other obligor on the
Securities shall be deemed to have been discharged from their obligations with
respect to the Defeased Securities on the date the conditions set forth below
are satisfied (hereinafter, "defeasance"). For this purpose, such defeasance
means that the Company and any other obligor of the Securities shall be deemed
to have paid and discharged the entire indebtedness represented by the
Defeased Securities, which shall thereafter be deemed to be "Outstanding" only
for the purposes of Section 4.5 and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Securities and this Indenture insofar as such
Securities are concerned (and the Trustee, at the expense of the Company and
upon written request, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (a) the rights of Holders of Defeased Securities to
receive, solely from the trust fund described in Section 4.4 and as more fully
set forth in such Section, payments in respect of the principal of, premium,
if any, and interest on such Securities when such payments are due, (b) the
Company's obligations with respect to such Defeased Securities under Section
3.4, 3.5, 3.6, 10.2 and 10.3, (c) the rights, powers, trusts, duties,
indemnities and immunities of the Trustee hereunder, and (d) this Article IV.
Subject to compliance with this Article IV, the Company may exercise its
option under this Section 4.2 notwithstanding the prior exercise of its option
under Section 4.3 with respect to the Securities.
Section 4.3. Covenant Defeasance.
Upon the Company's exercise under Section 4.1 of the option
applicable to this Section 4.3, both the Company and any other obligor on the
Securities shall be released from their obligations under any covenant or
provision contained in Sections 10.5 through 10.17, inclusive with respect to
the Defeased Securities on and after the date the conditions set forth below
are satisfied (hereinafter, "covenant defeasance"), and the Defeased
Securities shall thereafter be deemed to be not "Outstanding" for the purposes
of any direction, waiver, consent or declaration or Act of Holders (and the
consequences of any thereof) in connection with such covenants and provisions,
but shall continue to be deemed "Outstanding" for all other purposes
hereunder. For this purpose, such covenant defeasance means that, with
respect to the Defeased Securities, the Company and any other obligor of the
Securities may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such Section or Article,
whether directly or indirectly, by reason of any reference elsewhere herein or
in such Defeased Securities to any such Section or Article or by reason of any
reference in any such Section or Article to any other provision herein or in
any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 5.1(c), (d) or (e), but, except as
specified above, the remainder of this Indenture and such Defeased Securities
shall be unaffected thereby.
Section 4.4. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 4.2 or Section 4.3 to the Defeased Securities:
(1) The Company shall irrevocably have deposited or caused
to be deposited with the Trustee as trust funds in trust for the purpose of
making the following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such Securities, (a) United
States dollars in an amount, (b) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in accordance
with their terms will provide, not later than one day before the due date of
any payment, money in an amount, or (c) a combination thereof, in such amounts
as will be sufficient, as reflected in the written report of a nationally
recognized firm of independent public accountants or a nationally recognized
investment banking firm delivered to the Trustee, to pay and discharge (and
which shall be applied by the Trustee to pay and discharge) the principal of,
premium, if any, and interest on the Defeased Securities on the Stated
Maturity (or on any date after September 1, 2000 (such date being referred to
as the "Defeasance Redemption Date"), if prior to electing either defeasance
or covenant defeasance, the Company has delivered to the Trustee an
irrevocable notice to redeem all of the outstanding Securities on the
Defeasance Redemption Date) of such principal or installment of interest;
provided that the Trustee (or such qualifying trustee) shall have been
irrevocably instructed to apply such United States dollars or the proceeds of
such U.S. Government Obligations to said payments with respect to the
Securities. For this purpose, "U.S. Government Obligations" means securities
that are (i) direct obligations of the United States of America for the timely
payment of which its full faith and credit is pledged or (ii) obligations of a
Person controlled or supervised by and acting as an agency or instrumentality
of the United States of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America, which, in either case, are not callable or redeemable at the option
of the issuer thereof, and shall also include a depository receipt issued by a
bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with
respect to any such U.S. Government Obligation or a specific payment of
principal of or interest on any such U.S. Government Obligation held by such
custodian for the account of the holder of such depository receipt, provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt
from any amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of principal of or interest on the U.S.
Government Obligation evidenced by such depository receipt.
(2) In the case of an election under Section 4.2, the
Company shall have delivered to the Trustee an Opinion of Independent Counsel
in the United States to the effect that (A) the Company has received from, or
there has been published by, the Internal Revenue Service a ruling or (b)
since the date of this Indenture, there has been a change in the applicable
Federal income tax law, in either case to the effect that the Holders of the
Outstanding Securities will not recognize income, gain or loss for Federal
income tax purposes as a result of such defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such defeasance had not occurred.
(3) In the case of an election under Section 4.3, the
Company shall have delivered to the Trustee an Opinion of Independent Counsel
in the United States to the effect that the Holders of the Outstanding
Securities will not recognize income, gain or loss for Federal income tax
purposes as a result of such covenant defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not
occurred.
(4) No Default or Event of Default shall have occurred and
be continuing on the date of such deposit;
(5) Such defeasance or covenant defeasance shall not cause
the Trustee to have a conflicting interest with respect to any securities of
the Company.
(6) Such defeasance or covenant defeasance shall not result
in a breach or violation of, or constitute a Default under, this Indenture or
any other material agreement or instrument to which the Company is a party or
by which it is bound.
(7) The Company shall have delivered to the Trustee an
Opinion of Independent Counsel in the United States to the effect that (A) the
trust funds will not be subject to any rights of holders of Senior
Indebtedness, including without limitation, those arising under this Indenture
and (B) the defeasance trust does not violate the Investment Company Act of
1940 and after the passage of 123 days following the deposit the trust fund
will not be subject to the effect of sections 547 and 550 of the United States
Bankruptcy Code or section 15 of the New York Debtor and Creditor Law.
(8) The Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the Company
with the intent of preferring the holders of the Securities over the other
creditors of the Company or with the intent of defeating, hindering, delaying
or defrauding creditors of the Company or others.
(9) No event or condition shall exist on the date of such
deposit that would prevent the Company from making payments of the principal
of, premium, if any, and interest on the Securities on the date of such
deposit or at any time ending on the 123rd day after the date of such deposit.
(10) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Independent Counsel, each to the
effect that all conditions precedent provided for relating to either the
defeasance under Section 4.2 or the covenant defeasance under Section 4.3 (as
the case may be) have been complied with as contemplated by this Section 4.4.
Opinions of Counsel required to be delivered under this Section may
have qualifications customary for opinions of the type required and counsel
delivering such Opinions of Counsel may rely on certificates of the Company or
government or other officials customary for opinions of the type required,
which certificates shall be limited to matters of fact, including that various
financial covenants have been complied with.
Section 4.5. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 10.3, all
United States dollars and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 4.4 in respect of the
Defeased Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Securities of all sums due and to become due
thereon in respect of principal, premium, if any, and interest, but such money
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 4.4 or the principal and interest received in
respect thereof, other than any such tax, fee or other charge which by law is
for the account of the Holders of the Defeased Securities.
Anything in this Article IV to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any United States dollars or U.S. Government Obligations held by it as
provided in Section 4.4 which, in the opinion of a nationally recognized firm
of independent public accountants or nationally recognized investment banking
firm expressed in a written report delivered to the Trustee, are in excess of
the amount thereof which would then be required to be deposited to effect
defeasance or covenant defeasance. In the event of an error in any
calculation resulting in a withdrawal hereunder, the Company shall deposit an
amount equal to the amount erroneously withdrawn as promptly as practicable
after becoming aware of such error.
Section 4.6. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or U.S. Government Obligations in accordance with Section 4.2 or 4.3,
as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 4.2 or 4.3, as the case may be, until such time as the
Trustee or Paying Agent is permitted to apply all such United States dollars
or U.S. Government Obligations in accordance with Section 4.2 or 4.3, as the
case may be; provided, however, that (a) if the Company makes any payment to
the Trustee or Paying Agent of principal, premium, if any, or interest on any
Security following the reinstatement of its obligations, the Trustee or Paying
Agent shall promptly pay any such amount to the Holders of the Securities and
the Company shall be subrogated to the rights of the Holders of such
Securities to receive such payment from the United States dollars and U.S.
Government Obligations held by the Trustee or Paying Agent and (b) the Trustee
or Paying Agent shall return all such United States dollars and U.S.
Government Obligations to the Company promptly after receiving a Company
Request therefor at any time, if the Trustee or Paying Agent receives written
notice from the Company that such reinstatement of the Company's obligations
has occurred and continues to be in effect at such time.
ARTICLE V
REMEDIES
Section 5.1. Events of Default.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body);
(a) there shall be a default in the payment of any interest
on any Security when it becomes due and payable, and such default shall
continue for a period of 30 days;
(b) there shall be a default in the payment of the
principal of or premium, if any, on any Security at its Stated Maturity (upon
acceleration, optional or mandatory redemption, repurchase pursuant to a
Change of Control Offer, an offer in respect of Excess Proceeds or otherwise);
(c) (i) there shall be a default in the performance, or
breach, of any covenant or agreement of the Company under this Indenture
(other than a default in the performance, or breach, of a covenant or
agreement which is specifically dealt with in Section 5.1(a) or (b) or in
clauses (ii), (iii) or (iv) of this Section 5.1(c)) and such default or breach
shall continue for a period of 30 days after written notice of such failure
requiring the Company to remedy the same has been given, by certified mail,
(x) to the Company by the Trustee or (y) to the Company and the Trustee by the
Holders of at least 25% in aggregate principal amount of the Outstanding
Securities; (ii) there shall be a default in the performance or breach of the
provisions of Article VIII; (iii) the Company shall have failed to make or
consummate an Offer in accordance with the provisions of Section 10.12 or (iv)
the Company shall have failed to make or consummate a Change of Control Offer
in accordance with the provisions of Section 10.13;
(d) (i) any default in the payment of the principal,
premium, if any, or interest on any Indebtedness shall have occurred under any
agreements, indentures or instruments under which the Company or any
Subsidiary then has outstanding Indebtedness in excess of $5 million when the
same shall become due and payable and continuation of such default after any
applicable grace period and, if not already matured at its final maturity in
accordance with its terms, the holder of such Indebtedness shall have no right
to accelerate such Indebtedness or (ii) an event of default as defined in any
of the agreements, indentures or instruments described in clause (i) of this
Section 5.1(d) shall have occurred and the Indebtedness thereunder, if not
already matured at its final maturity in accordance with its terms, shall have
been accelerated;
(e) one or more judgments, orders or decrees for the
payment of money in excess of $2.5 million, either individually or in the
aggregate (net of amounts for which an insurance company has agreed that it is
liable) shall be entered against the Company or any Subsidiary or any of their
respective properties and shall not be discharged and either (i) any creditor
shall have commenced an enforcement proceeding upon such judgment, order or
decree or (ii) there shall have been a period of 90 consecutive days during
which a stay of enforcement of such judgment or order, by reason of an appeal
or otherwise, shall not be in effect;
(f) there shall have been the entry by a court of competent
jurisdiction of (i) a decree or order for relief in respect of the Company or
any Material Subsidiary in an involuntary case or proceeding under any
applicable Bankruptcy Law or (ii) a decree or order adjudging the Company or
any Material Subsidiary bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company or any
Material Subsidiary under any applicable Federal or state law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Company or any Material Subsidiary or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and any such decree or order for relief shall continue to be in
effect, or any such other decree or order shall be unstayed and in effect, for
a period of 90 consecutive days;
(g) (i) the Company or any Material Subsidiary commences a
voluntary case or proceeding under any applicable Bankruptcy Law or any other
case or proceeding to be adjudicated bankrupt or insolvent, (ii) the Company
or any Material Subsidiary consents to the entry of a decree or order for
relief in respect of the Company or such Material Subsidiary in an involuntary
case or proceeding under any applicable Bankruptcy Law or to the commencement
of any bankruptcy or insolvency case or proceeding against it, (iii) the
Company or any Material Subsidiary files a petition or answer or consent
seeking reorganization or relief under any applicable Federal or state law,
(iv) the Company or any Material Subsidiary (A) consents to the filing of such
petition or the appointment of, or taking possession by, a custodian,
receiver, liquidator, assignee, trustee, sequestrator, or similar official of
the Company or such Material Subsidiary or of any substantial part of its
property, (B) makes an assignment for the benefit of creditors or (C) admits
in writing its inability to pay its debts generally as they become due or (v)
the Company or any Material Subsidiary takes any corporate action in
furtherance of any such actions in this Section 5.1(g);
(h) any holder or holders of at least $5 million in
aggregate principal amount of Indebtedness of the Company or any Subsidiary
after a default under such Indebtedness shall notify the Trustee of the
intended sale or disposition of any assets of the Company or any Subsidiary
that have been pledged to or for the benefit of such holder or holders to
secure such Indebtedness or shall commence proceedings, or take any action
(including by way of set-off), to retain in satisfaction of such Indebtedness
or to collect on, seize, dispose of or supply in satisfaction of Indebtedness,
assets of the Company or any Subsidiary (including funds on deposit or held
pursuant to lock-box and other similar arrangements); or
(i) the Company shall fail to redeem the Existing Notes
within 45 days after the date of the original issuance of the Securities.
Section 5.2. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Sections 5.1(f) and (g)) occurs and is continuing, the Trustee or the Holders
of not less than 25% in aggregate principal amount of the Outstanding
Securities may declare all the Securities to be due and payable immediately in
an amount equal to the principal amount of the Outstanding Securities,
together with accrued and unpaid interest, if any, to the date the Securities
shall have become due and payable, by a notice in writing to the Company (and
to the Trustee, if given by Holders) and thereupon the Trustee may, at its
discretion, proceed to protect and enforce the rights of the Holder of the
Securities by appropriate judicial proceeding. If an Event of Default
specified in Section 5.1(f) or (g) occurs and is continuing, then all the
Securities shall ipso facto become and be immediately due and payable, in an
amount equal to the principal amount of the Securities, together with accrued
and unpaid interest, if any, to the date the Securities become due and
payable, without any declaration or other act on the part of the Trustee or
any Holder.
At any time after such declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as provided hereinafter in this Article, the Holders of at least a
majority in aggregate principal amount of the Outstanding Securities, by
written notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if:
(a) the Company has paid or deposited with the Trustee a
sum sufficient to pay:
(i) all sums paid or advanced by the Trustee under
Section 6.6 and the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel,
(ii) all overdue interest on all Securities, and
(iii) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by the Securities;
and
(b) all Events of Default, other than the non-payment of
principal of the Securities which have become due solely by such declaration
of acceleration, have been cured or waived as provided in Section 5.13.
No such rescission shall affect any subsequent Default or impair any right
consequent thereon.
Section 5.3. Collection of Indebtedness and Suits for Enforcement
by Trustee.
The Company covenants that if:
(a) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default continues
for a period of 30 days, or
(b) default is made in the payment of the principal of or
premium, if any, on any Security at the Stated Maturity (upon acceleration,
optional or mandatory redemption, required repurchase or otherwise) thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of
the Holders of such Securities the whole amount then due and payable on such
Securities for principal and premium, if any, and interest, with interest upon
the overdue principal and premium, if any, and, to the extent that payment of
such interest shall be legally enforceable, upon overdue installments of
interest, at the rate borne by the Securities.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute
a judicial proceeding for the collection of the sums so due and unpaid and may
prosecute such proceeding to judgment or final decree, and may enforce the
same against the Company or any other obligor upon the Securities and collect
the moneys adjudged or decreed to be payable in the manner provided by law out
of the property of the Company or any other obligor upon the Securities,
wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders under this Indenture by such appropriate private or judicial
proceedings as the Trustee shall deem most effectual to protect and enforce
such rights, and may enforce any other proper remedy, subject however to
Section 5.12.
The rights and remedies under this Section 5.3 are in addition to
the other rights and remedies under this Article V.
Section 5.4. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition
or other similar judicial proceeding relative to the Company or any other
obligor upon the Securities or the property of the Company or of such other
obligor or their creditors, the Trustee (irrespective of whether the principal
of the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Company for the payment of overdue principal or
interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise:
(a) to file and prove a claim for the whole amount of
principal, and premium, if any, and interest owing and unpaid in respect of
the Securities and to file such 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 of the Holders allowed in such judicial
proceeding; and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay
the Trustee any amount due if for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 6.6.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment, composition or other similar
arrangement affecting the Securities or the rights of any Holder thereof, or
to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
Section 5.5. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name and as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of the Securities in
respect of which judgment has been recovered.
Section 5.6. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article or
otherwise on behalf of the Holders or the Trustee pursuant to this Article or
through any proceeding or any arrangement or restructuring in anticipation or
in lieu of any proceeding contemplated by this Article shall be applied,
subject to the applicable law, in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money on account
of principal, premium, if any, or interest, upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 6.6;
SECOND: To the payment in full of the amounts then due and
unpaid upon the Securities for principal, premium, if any, and interest, in
respect of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according to the amounts
due and payable on such Securities for principal, premium, if any, and
interest; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto as a court of competent jurisdiction shall direct, or to the Company,
provided that all sums due and owing to the Holders and the Trustee have been
paid in full as required by this Indenture.
Section 5.7. Limitation on Suits.
No Holder of any Securities shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture or the
Securities, or for the appointment of a receiver or trustee, or for any remedy
hereunder, unless:
(a) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(b) the Holders of not less than 25% in principal amount of
the Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(c) such Holder or Holders have offered, and if requested
have provided, to the Trustee an indemnity satisfactory to the Trustee in its
sole discretion against the costs, expenses and liabilities to be incurred in
compliance with such request,
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other
Holders, or to obtain or seek to obtain priority or preference over any other
Holders or to enforce any right under this Indenture, except in the manner
provided in this Indenture and for the equal and ratable benefit of all the
Holders.
Section 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right on the terms stated herein, which is
absolute and unconditional, to receive payment of the principal of, premium,
if any, and (subject to Section 3.7) interest on such Security on the
respective Stated Maturities expressed in such Security (or, in the case of
redemption, on the Redemption Date) and to institute suit for the enforcement
of any such payment, and such rights shall not be impaired without the consent
of such Holder.
Section 5.9. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, (a) the Company and any other obligor under
the Securities, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder, and (b) thereafter all
rights and remedies of the Trustee and the Holders shall continue as though no
such proceeding had been instituted.
Section 5.10. Rights and Remedies Cumulative.
Except as provided in Section 3.6, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Security
to exercise any right or remedy accruing upon any Event of Default shall
impair any such right or remedy or constitute a waiver of any such Event of
Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be exercised from time
to time, and as often as may be deemed expedient, by the Trustee or by the
Holders, as the case may be.
Section 5.12. Control by Holders.
The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, provided
that:
(a) such direction shall not be in conflict with any rule
of law or with this Indenture (including, without limitation, Section 5.7) or
expose the Trustee to personal liability; and
(b) subject to the provisions of Section 315 of the Trust
Indenture Act, the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 5.13. Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities may, on behalf of the Holders of all the
Securities, waive any past Default hereunder and its consequences, except a
Default:
(a) in the payment of the principal of, premium, if any, or
interest on any Security, or
(b) in respect of a covenant or provision hereof which
under Article IX cannot be modified or amended without the consent of the
Holder of each Outstanding Security affected by such modification or
amendment.
Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereon.
Section 5.14. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may
in its discretion require, 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, suffered or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit, and that such
court may in its discretion assess reasonable costs, including reasonable
attorney's fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of, premium, if any, or interest
on any Security on or after the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on or after the Redemption Date).
Section 5.15. Waiver of Stay, Extension or Usury Laws.
Each of the Company and any other obligor under the Securities
covenants (to the extent enforceable under law) that it will not at any time
insist upon, or plead, or in any manner whatsoever claim or take the benefit
or advantage of, the automatic stay under section 362 of the United States
Bankruptcy Code or any other stay or extension law or any usury or other
similar law wherever enacted, now or at any time hereafter in force, which
would prohibit or forgive the Company or any other obligor under the
Securities from paying all or any portion of the principal of, premium, if
any, or interest on the Securities contemplated herein or in the Securities or
which may affect the covenants or the performance of this Indenture; and each
of the Company and any other obligor under the Securities (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.
Section 5.16. Remedies Subject to Applicable Law.
All rights, remedies and powers provided by this Article may be
exercised only to the extent that the exercise thereof does not violate any
applicable provision of law in the premises, and all the provisions of this
Indenture are intended to be subject to applicable mandatory provisions of law
which may be controlling in the premises and to be limited to the extent
necessary so that they will not render this Indenture invalid, unenforceable
or not entitled to be recorded, registered or filed under the provisions of
any applicable law.
ARTICLE VI
THE TRUSTEE
Section 6.1. Notice of Defaults.
Within 30 days after a Responsible Officer of the Trustee receives
notice of the occurrence of any Default, the Trustee shall transmit by mail to
all Holders or any other persons entitled to receive reports pursuant to Trust
Indenture Act Section 313(c) notice of such Default, unless such Default shall
have been cured or waived. Except in the case of a Default or Event of
Default in payment of the principal of, premium, if any, or interest on any
Security, the Trustee may withhold and shall be protected in withholding such
notice if and so long as the board of directors of the Trustee, the executive
committee of the board of directors of the Trustee or a committee of
Responsible Officers of the Trustee in good faith determines that withholding
the notice is in the interests of the Holders; provided that the Trustee shall
have no obligation to present such question for determination by its board of
directors or any such committee.
Section 6.2. Certain Rights of Trustee.
Subject to the provisions of Trust Indenture Act Section 315(a)
through 315(d):
(a) the Trustee, in the absence of willful misconduct or
negligence on its part, may rely conclusively on, and shall be protected in
acting or refraining from acting upon, any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, security, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) 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;
(c) wherever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established prior
to the taking, suffering or omitting of any action hereunder, the Trustee
(unless other evidence be herein specifically prescribed) in the absence of
bad faith or negligence on its part, may rely conclusively upon an Officers'
Certificate and/or an Opinion of Counsel that conforms to the requirements of
this Indenture;
(d) the Trustee may consult with counsel and any written
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith without negligence and in reliance
thereon in accordance with such advice or Opinion of Counsel;
(e) the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture, unless such
Holders shall have offered to the Trustee security or indemnity satisfactory
to the Trustee in its sole discretion against the costs, expenses and
liabilities which might be incurred therein or thereby in compliance with such
request or direction;
(f) the Trustee shall not be liable for any action taken or
omitted by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture other than
any liabilities arising out of the negligence or willful misconduct of the
Trustee;
(g) 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, approval, appraisal, bond, debenture, security, coupon, security or
other paper or document; but the Trustee in its discretion may make such
further inquiry or investigation in accordance with any of the provisions of
this Indenture 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 such relevant books, records and premises of the
Company as may be reasonable, personally or by agent or attorney;
(h) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent (other than an agent who is
an employee of the Trustee) or attorney appointed with due care by it
hereunder; and
(i) no provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights and powers if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
Section 6.3. Trustee Not Responsible for Recitals, Dispositions of
Securities or Application of Proceeds Thereof.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or the Securities, except that the Trustee represents that it is
duly authorized to execute and deliver this Indenture, authenticate the
Securities and perform its obligations hereunder and that the statements made
by it in a Statement of Eligibility and Qualification on Form T-1 supplied to
the Company are true and accurate subject to the qualifications set forth
therein. The Trustee shall not be accountable for the use or application by
the Company of Securities or the proceeds thereof.
Section 6.4. Trustee and Agents May Hold Securities; Collections;
etc.
The Trustee, any Paying Agent, Security Registrar or any other agent
of the company, in its individual or any other capacity, may become the owner
or pledgee of Securities, with the same rights it would have if it were not
the Trustee, Paying Agent, Security Registrar or such other agent and, subject
to Trust Indenture Act Sections 310 and 311, may otherwise deal with the
Company and receive, collect, hold and retain collections from the Company
with the same rights it would have if it were not the Trustee, Paying Agent,
Security Registrar or such other agent.
Section 6.5. Money Held in Trust.
All moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were
received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Except for funds or securities
deposited with the Trustee pursuant to Article IV, the Trustee shall only be
required to invest moneys received by the Trustee, until used with the
directions of the Company.
Section 6.6. Compensation and Indemnification of Trustee and Its
Prior Claim.
The Company covenants and agrees to pay to the Trustee promptly upon
request, and the Trustee shall be entitled to, reasonable compensation for all
services rendered by it hereunder (which, to the extent lawful, shall not be
limited by any provision of law in regard to the compensation of a trustee of
an express trust) and the Company covenants and agrees to reimburse the
Trustee and each predecessor Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by or on behalf of it in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and
of all agents and other persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence, bad faith
or willful misconduct. When the Trustee incurs expenses and renders services
in connection with an Event of Default specified in Section 5.1(f) or Section
5.1(g), the expenses (including the reasonable compensation and the expenses
and disbursements of its counsel) and the compensation for the services are
intended to constitute expenses of administration under any applicable Federal
or state bankruptcy, insolvency or other similar law. The Company also
covenants to indemnify the Trustee and each predecessor Trustee, and their
respective officers, agents and employees for, and to hold them harmless
against, any claim, loss, liability, tax, assessment or other governmental
charge (other than taxes applicable to the Trustee's compensation hereunder)
or expense incurred without negligence, bad faith or willful misconduct on its
part, arising out of or in connection with the acceptance or administration of
this Indenture or the trusts hereunder and its duties hereunder, including
enforcement of this Section 6.6 and also including any liability which the
Trustee may incur as a result of the Company's failure to withhold, pay or
report any tax, assessment or other governmental charge, and the costs and
expenses of defending itself against or investigating any claim of liability
in the premises. The obligations of the Company under this Section to
compensate and indemnify the Trustee and each predecessor Trustee and to pay
or reimburse the Trustee and each predecessor Trustee for expenses,
disbursements and advances shall constitute an additional obligation hereunder
and shall survive the satisfaction and discharge of this Indenture and the
resignation or removal of the Trustee and each predecessor Trustee.
Section 6.7. Conflicting Interests.
The Trustee shall comply with the provisions of Section 310(b) of
the Trust Indenture Act.
Section 6.8. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee under Trust Indenture Act Section 310(a) and which
shall have a combined capital and surplus of at least $100.0 million. If the
Trustee publishes reports of condition at least annually, pursuant to law or
to the requirements of Federal, state, territorial or District of Columbia
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of the Trustee shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
Section 6.9. Resignation and Removal; Appointment of Successor
Trustee.
(a) No resignation or removal of the Trustee and no appointment
of a successor Trustee pursuant to this Article shall become effective until
the acceptance of appointment by the successor Trustee under Section 6.10.
(b) The Trustee, or any trustee or trustees hereafter appointed,
may at any time resign by giving written notice thereof to the Company. Upon
receiving such notice of resignation, the Company shall use its best efforts
to promptly appoint a successor Trustee by Board Resolution or written
instrument executed by authority of the Board of Directors of the Company, a
copy of which shall be delivered to the resigning Trustee and a copy to the
successor Trustee. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving
of such notice of resignation, the resigning Trustee may, or any Holder who
has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee. Such court
may thereupon, after such notice, if any, as it may deem proper, appoint a
successor Trustee.
(c) The Trustee may be removed at any time by an Act of the
Holders of not less than a majority in aggregate principal amount of the
Outstanding Securities, delivered to the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of
Trust Indenture Act Section 310(b) after written request therefor by the
Company or by any Holder who has been a bona fide Holder of the Security for
at least six months, or
(2) the Trustee shall cease to be eligible under Section
6.9 and shall fail to resign after written request therefor by the Company or
by any such Holder, or
(3) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or control
of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation; then, in any case, (i) the
Company by a Board Resolution may remove the Trustee, or (ii) subject to
Section 5.14, any Holder of any security who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of the Trustee for any
cause, the Company, by a Board Resolution or written instrument executed by
authority of the Board of Directors of the Company, shall use its best efforts
to promptly appoint a successor Trustee and shall comply with the applicable
requirements of Section 6.11. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, the Company or a
court of competent jurisdiction has not appointed a successor Trustee, a
successor Trustee shall be appointed by Act of the Holders of a majority in
principal amount of the Outstanding Securities delivered to the Company and
the retiring Trustee, and the successor Trustee so appointed shall, forthwith
upon its acceptance of such appointment, become the successor Trustee and
supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders of the
Securities and accepted appointment in the manner hereinafter provided, any
Holder of a Security who has been a bona fide Holder for at least six months
may, subject to Section 5.14, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of
a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities as their names and addresses appear in the Security
Register. Each notice shall include the name of the successor Trustee and the
address of its Corporate Trust Office or agent hereunder.
Section 6.10. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with
respect to the Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all rights, powers, trusts and duties of the retiring Trustee under this
Indenture; but, nevertheless, on the written request of the Company or the
successor Trustee, upon payment of its charges then unpaid, such retiring
Trustee shall pay over to the successor Trustee all moneys at the time held by
it hereunder and shall execute and deliver an instrument transferring to such
successor Trustee all such rights, powers, duties and obligations.
Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights and powers. Any Trustee
ceasing to act shall, nevertheless, retain a prior claim upon all property or
funds held or collected by such Trustee or such successor Trustee to secure
any amounts then due such Trustee pursuant to the provisions of Section 6.6.
No successor Trustee with respect to the Securities shall accept
appointment as provided in this Section 6.10 unless at the time of such
acceptance such successor Trustee shall be eligible to act as Trustee under
the provisions of Trust Indenture Act Section 310(a) and this Article VI and
shall have a combined capital and surplus of at least $100.0 million.
Upon acceptance of appointment by any successor Trustee as provided
in this Section 6.10, the Company shall give notice thereof to the Holders of
the Securities, by mailing such notice to such Holders at their addresses as
they shall appear on the Security Register. If the acceptance of appointment
is substantially contemporaneous with the resignation, then the notice called
for by the preceding sentence may be combined with the notice called for by
Section 6.10. If the Company fails to give such notice within 10 days after
acceptance of appointment by the successor Trustee, the successor Trustee
shall cause such notice to be given at the expense of the Company.
Section 6.11. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto; provided that such corporation shall be eligible
under Trust Indenture Act Section 310(a) and this Article VI and shall have a
combined capital and surplus of at least $100,000,000.
In case at the time such successor to the Trustee shall succeed to
the Trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt
the certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor hereunder
or in the name of the successor Trustee; and in all such cases such
certificate shall have the full force which it is anywhere in the Securities
or in this Indenture provided that the certificate of the Trustee shall have;
provided that the right to adopt the certificate of authentication of any
predecessor Trustee or to authenticate Securities in the name of any
predecessor Trustee shall apply only to its successor or successors by merger,
amalgamation, conversion or consolidation.
Section 6.12. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or other obligor under the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor). In particular, the Trustee
shall comply with the Trust Indenture Act Section 311(a), excluding any
creditor relationship listed in Trust Indenture Act Section 311(b). A Trustee
who has resigned or been removed shall be subject to Trust Indenture Act
Section 311(a) to the extent indicated therein.
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 7.1. Company to Furnish Trustee Names and Addresses of
Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semiannually, not more than 10 days after each Regular
Record Date, a list, in such form as the Trustee may reasonably require, of
the names and addresses of the Holders as of such Regular Record Date; and
(b) at such other times as the Trustee may reasonably
request in writing, within 30 days after receipt by the Company of any such
request, a list of similar form and content to that in Subsection (a) hereof
as of a date not more than 15 days prior to the time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Security
Registrar, no such list need be furnished.
Section 7.2. Disclosure of Names and Addresses of Holders.
Holders may communicate pursuant to Trust Indenture Act Section
312(b) with other Holders with respect to their rights under this Indenture or
the Securities, and the Trustee shall comply with Trust Indenture Act Section
312(b). The Company, the Trustee, the Registrar and any other Person shall
have the protection of Trust Indenture Act Section 312(c). Further, every
Holder of Securities, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company nor the Trustee nor any agent
of either of them shall be held accountable by reason of the disclosure of any
information as to the names and addresses of the Holders in accordance with
Trust Indenture Act Section 312, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under Trust
Indenture Action Section 312.
Section 7.3. Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with the
first May 15 after the issuance of Securities, the Trustee, if so required
under the Trust Indenture Act shall transmit by mail to all Holders in the
manner and to the extent provided in Trust Indenture Act Section 313(c), a
brief report dated as of such May 15 in accordance with and with respect to
the matters required by Trust Indenture Act Section 313(a). The Trustee shall
also transmit by mail to the Holders, in the manner and to the extent provided
in Trust Indenture Act Section 313(c), a brief report in accordance with and
with respect to the matters required by Trust Indenture Act Section 313(b)(2).
(b) A copy of each report transmitted to Holders pursuant to
this Section 7.3 shall, at the time of such transmission, be mailed to the
Company and filed with each stock exchange, if any, upon which the Securities
are listed and also with the Commission.
Section 7.4. Reports by Company.
The Company shall:
(a) file with the Trustee, in accordance with Section 10.17
hereof, and in any event within 30 days after the Company is required to file
the same with the Commission, copies of the annual reports and of the
information, documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules and regulations
prescribe) which the Company is required to file with the Commission pursuant
to Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not
required to file information, documents or reports pursuant to either of said
Sections, then it shall (i) deliver to the Trustee annual audited financial
statements of the Company and its Subsidiaries, prepared on a consolidated
basis in conformity with GAAP, within 120 days after the end of each fiscal
year of the Company, and (ii) file with the Trustee and the Commission, in
accordance with, and so long as not prohibited by, the rules and regulations
prescribed from time to time by the Commission, such of the supplementary and
periodic information, documents and reports which may be required pursuant to
Section 13 of the Exchange Act in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in
such rules and regulations;
(b) file with the Trustee and the Commission, in accordance
with the rules and regulations prescribed from time to time by the Commission,
such additional information, documents and reports with respect to compliance
by the Company with the conditions and covenants for this Indenture as is
required from time to time by such rules and regulations (including such
information, documents and reports referred to in Trust Indenture Act Section
314(a)); and
(c) within 30 days after the filing thereof with the
Trustee, transmit by mail to all Holders in the manner and to the extent
provided in Trust Indenture Act Section 313(c), such summaries of any
information, documents and reports required to be filed by the Company
pursuant to Section 10.18 hereunder and subsections (a) and (b) of this
Section as is required and not prohibited by rules and regulations prescribed
from time to time by the Commission.
ARTICLE VIII
CONSOLIDATION, MERGER, SALE OF ASSETS
Section 8.1. Company May Merge, Consolidate etc., Only on Certain
Terms.
The Company shall not, in a single transaction or a series of
related transactions, consolidate with or merge with or into any other Person
or sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets to any Person or group of
affiliated Persons, or permit any of its Subsidiaries to enter into any such
transaction or transactions if such transaction or transactions, in the
aggregate, would result in a sale, assignment, conveyance, transfer, lease or
disposition of all or substantially all of the properties and assets of the
Company and its Subsidiaries on a Consolidated basis to any other Person or
group of affiliated Persons, unless: (i) either (a) the Company shall be the
continuing corporation or (b) the Person (if other than the Company) formed by
such consolidation or into which the Company is merged or the Person which
acquires by sale, assignment, conveyance, transfer, lease or disposition of
all or substantially all of the properties and assets of the Company and its
Subsidiaries on a Consolidated basis (the "Surviving Entity") shall be a
corporation duly organized and validly existing under the laws of the United
States of America, any state thereof or the District of Columbia and such
Person assumes by a supplemental indenture in a form reasonably satisfactory
to the Trustee all the obligations of the Company under the Securities and
this Indenture, and this Indenture shall remain in full force and effect; (ii)
immediately before and immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; (iii)
immediately after giving effect to such transaction, the Consolidated Net
Worth of the Company (or the Surviving Entity if the Company is not the
continuing obligor under the Indenture) is equal to or greater than the
Consolidated Net Worth of the Company immediately prior to such transaction;
(iv) immediately before and immediately after giving effect to such
transaction on a pro forma basis (on the assumption that the transaction
occurred on the first day of the four-quarter period immediately prior to the
consummation of such transaction with the appropriate adjustments with respect
to the transaction being included in such pro forma calculation), the Company
(or the Surviving Entity if the Company is not the continuing obligor under
the Indenture) could incur $1.00 of additional Indebtedness under the
provisions of Section 10.8 (other than Permitted Indebtedness); and (v) the
Company shall have delivered, or caused to be delivered, to the Trustee, in
form and substance reasonably satisfactory to the Trustee, an Officers'
Certificate and an Opinion of counsel, each to the effect that such
consolidation, merger, transfer, lease or other transaction and the
supplemental indenture in respect thereto comply with the provisions described
in this Section 8.1 and that all conditions precedent herein provided for in
this Section 8.1 relating to such transaction have been complied with.
Notwithstanding any provision to the contrary contained in this Indenture,
including without limitation the agreements and restrictions contained in this
Article VIII and the agreements and covenants elsewhere contained herein, the
Company shall not be prevented, restricted or limited in any way from merging
with and into Haynes Holdings, Inc. ("Holdings").
Section 8.2. Successor Substituted.
Upon any consolidation or merger, or any sale, assignment,
conveyance, transfer, lease or disposition of all or substantially all of the
properties and assets on a Consolidated basis of the Company in accordance
with Section 8.1 with respect to which the Company is not the continuing
corporation, the successor Person formed by such consolidation or into which
the Company is merged or the successor Person to which such sale, assignment,
conveyance, transfer, lease or disposition is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture, with the same effect as if such successor had been named as
the Company herein. When a successor assumes all the obligations of its
predecessor under this Indenture or the Securities, the predecessor shall be
released from those obligations; provided that, in the case of a transfer by
lease, the predecessor shall not be released from the payment of principal and
interest on the Securities.
Any successor to the Company described in the foregoing paragraph
may cause to be signed, and may issue either in its own name or in the name of
the Company, any or all of the Securities issuable hereunder which theretofore
shall not have been signed by the Company and delivered to the Trustee; and,
upon the order of such successor, instead of the Company, and subject to the
terms, conditions and limitations in this Indenture prescribed, the Trustee
shall authenticate and shall delivered any Securities which previously shall
have been signed and delivered by the officers of the Company to the Trustee
for authentication, and any Securities which such successor thereafter shall
cause to be signed and delivered to the Trustee for that purpose. All the
Securities so issued shall in all respects have the same legal rank and
benefit under this Indenture as the Securities theretofore or thereafter
issued in accordance with the terms of this Indenture as though all of such
Securities had been issued at the date of the execution of this Indenture.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures and Agreements without Consent
of Holders.
Without the consent of any Holders, the Company and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental hereto in form and substance reasonably satisfactory to the
Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of the
Company herein and in the Securities;
(b) to add to the covenants of the Company for the benefit
of the Holders, or to surrender any right or power conferred upon the Company
in this Indenture or the Securities;
(c) to cure any ambiguity or to correct or supplement any
provision in this Indenture or the Securities which may be defective or
inconsistent with any other provision in this Indenture or the Securities;
(d) to comply with the requirements of the Commission in
order to effect or maintain the qualification of this Indenture under the
Trust Indenture Act, as contemplated by Section 9.5 or otherwise;
(e) to add a guarantor of the Indenture Obligations;
(f) to evidence and provide the acceptance of the
appointment of a successor Trustee hereunder;
(g) to mortgage, pledge, hypothecate or grant a security
interest in favor of the Trustee for the benefit of the Holders as additional
security, for the payment and performance of the Indenture Obligations, in any
property or assets, including any which are required to be mortgaged, pledged
or hypothecated, or in which a security interest is required to be granted, to
the Trustee pursuant to this Indenture or otherwise; and
(h) to clarify any other provisions with respect to matters
or questions arising under this Indenture or the Securities; provided that, in
each case, such clarification or provision thus made shall not adversely
affect the interests of the Holders.
Section 9.2. Supplemental Indentures and Agreements with Consent of
Holders.
Except as permitted by Section 9.1, with the consent of the Holders
of not less than a majority in aggregate principal amount of the Outstanding
Securities, by Act of said Holders delivered to the Company and the Trustee,
the Company and the Trustee may (i) enter into an indenture or indentures
supplemental hereto in form and substance reasonably satisfactory to the
Trustee, for the purpose of adding any provisions to or amending, modifying or
changing in any manner or eliminating any of the provisions of this Indenture
or the Securities (including, but not limited to, for the purpose of modifying
in any manner the rights of the Holders under this Indenture or the
Securities) or (ii) waive compliance with any provision in this Indenture or
the Securities (other than waivers of past Defaults covered by Section 5.13
and waivers of covenants which are covered by Section 10.19); provided,
however, that no such supplemental indenture, agreement or instrument shall,
without the consent of the Holder of each Outstanding Security affected
thereby:
(a) change the Stated Maturity of the principal of, or any
installment of interest on, any Security or waive a default in the payment of
the principal or interest on any Security or reduce the principal amount
thereof or the rate of interest thereon or any premium payable upon the
redemption thereof, or change the coin or currency in which the principal of
any Security or any premium or the interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment after the
Stated Maturity thereof;
(b) amend, change or modify the obligation of the Company
to make and consummate an offer in accordance with Section 10.12, including
amending, changing or modifying any of the provisions or definitions with
respect thereto;
(c) amend, change or modify the obligation of the Company
to make and consummate an offer in accordance with Section 10.13, including
amending, changing or modifying any of the provisions or definitions with
respect thereto;
(d) amend, change or modify the ability of the Company to
make and consummate an offer in accordance with Section 10.14, including
amending, changing or modifying any of the provisions or definitions with
respect thereto;
(e) reduce the percentage in principal amount of the
Outstanding Securities, the consent of whose Holders is required for any such
supplemental indenture or the consent of whose Holders is required for any
waiver of compliance with certain provisions of this Indenture or certain
Defaults hereunder and their consequences provided for in this Indenture;
(f) modify any of the provisions of this Section or Section
5.13 or 10.18, except to increase the percentage of Outstanding Securities
required for such actions or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the Holder of
each Security affected thereby;
(g) except as otherwise permitted under Article VIII,
consent to the assignment or transfer by the Company of any of its rights and
obligations under this Indenture; or
(h) amend or modify any of the provisions of this Indenture
in any manner which subordinates the Securities in right of payment to other
Indebtedness of the Company.
Upon the written request of the Company, accompanied by a copy of a
Board Resolution authorizing the execution of any such supplemental indenture,
and upon the filing with the Trustee of evidence of the consent of Holders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture.
It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
Section 9.3. Execution of Supplemental Indentures and Agreements.
In executing, or accepting the additional trusts created by, any
supplemental indenture, agreement or instrument permitted by this Article or
the modifications thereby of the trusts created by this Indenture, the Trustee
shall be entitled to receive, and (subject to Trust Indenture Act Section
315(a) through 315(d) and Section 6.3 hereof) shall be fully protected in
relying upon, an Opinion of Counsel and an Officers' Certificate to the effect
that the execution of such supplemental indenture, agreement or instrument is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture, agreement or
instrument which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.
Section 9.4. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes;
and every Holder of Securities theretofore or thereafter authenticated and
delivered hereunder shall be bound thereby.
Section 9.5. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 9.6. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article IX may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Securities modified so as to conform to any such supplemental
indenture, in the opinion of the Trustee and the Board of Directors, may be
prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities.
Section 9.7. Record Date.
If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, 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 supplemental indenture,
agreement or instrument or any waiver, and shall promptly notify the Trustee
of any such record date. If a record date is fixed, 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 supplemental indenture,
agreement or instrument or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders after such record date.
The record date shall be a date no more than 30 days prior to the first
solicitation of Holders generally in connection therewith and no later than
the date such solicitation is completed. No such consent shall be valid or
effective for more than six months after such record date. Subject to
applicable law, until any supplemental indenture, agreement, instrument or
waiver becomes effective, or a consent to it by a Holder of a Security shall
cease to be valid and effective as set forth in the preceding sentence, such
consent is a continuing consent by the Holder and every subsequent Holder of a
Security or portion of a Security that evidences the same debt as the
consenting Holder's Security.
ARTICLE X
COVENANTS
Section 10.1. Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of, premium,
if any, and interest on the Securities in accordance with the terms of the
Securities and this Indenture.
Section 10.2. Maintenance of Office or Agency.
The Company will maintain an office or agency where Securities may
be presented or surrendered for payment, where Securities may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the Securities and this Indenture may be
served. The office of the Trustee at 101 West Washington Street, Suite 655
South, Indianapolis, Indiana 46255, shall be such office or agency of the
Company, unless the Company shall designate and maintain some other office or
agency for one or more of such purposes. The Company will give prompt written
notice to the Trustee of any change in the location of any 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 Corporate Trust Office, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices
and demands.
The Company may 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 designation.
The Company will give prompt written notice to the Trustee of any such
designation or rescission and any change in the location of any such office or
agency.
Section 10.3. Money for Security Payments to be Held in Trust.
The Company will, at least one Business Day prior to each due date
of the principal of, premium, if any, or interest on, any Securities, deposit
with a Paying Agent (which shall not be the Company) a sum in same day funds
sufficient to pay the principal, premium, if any, or interest so becoming due,
such sum to be held in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is the Trustee)
the Company will promptly notify the Trustee of such action or any failure so
to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(a) hold all sums held by it for the payment of the
principal of, premium, if any, or interest on Securities in trust for the
benefit of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
(b) give the Trustee notice of any Default by the Company
(or any other obligor upon the Securities) in the making of any payment of
principal, premium, if any, or interest;
(c) at any time during the continuance of any such Default,
upon the written request of the Trustee, forthwith pay to the Trustee all sums
so held in trust by such Paying Agent and account for any funds disbursed; and
(d) acknowledge, accept and agree to comply in all aspects
with the provisions of this Indenture relating to the duties, rights and
disabilities of such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by
Company Order direct any Paying Agent to pay to the Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by such Paying Agent; and upon
such payment by any Paying Agent to the Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent in trust
for the payment of the principal of, premium, if any, or interest on any
Security and remaining unclaimed for two years after such principal and
premium, if any, or interest has become due and payable shall promptly be paid
to the Company upon Company Request; and the Holders of such Security shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such payment to the Company,
may at the expense of the Company cause to be published once, in The New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will promptly be repaid to the
Company.
Section 10.4. Corporate Existence.
Subject to Article VIII, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and related rights and franchises (charter and statutory) of the
Company and each Subsidiary; provided, however, that the Company shall not be
required to preserve any such right or franchise or the corporate existence of
any such 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 as a whole and that the loss
thereof would not reasonably be expected to have a material adverse effect on
the ability of the Company to perform its obligations hereunder; and provided,
further, however, that the foregoing shall not prohibit a sale, transfer or
conveyance of a Subsidiary or any of its assets in compliance with the terms
of this Indenture.
Section 10.5. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
on or before the date the same shall become due and payable, (a) all material
taxes, assessments and governmental charges levied or imposed upon the Company
or any Subsidiary shown to be due on any return of the Company or any
Subsidiary or otherwise assessed or upon the income, profits or property of
the Company or any Security and (b) all material lawful claims for labor,
materials and supplies, which, if unpaid, would by law become a Lien upon the
property of the Company or any Subsidiary, except for any Lien permitted to be
incurred under Section 10.11; 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 properly instituted and
diligently conducted and in respect of which appropriate reserves (in the good
faith judgment of management of the Company) are being maintained in
accordance with GAAP consistently applied.
Section 10.6. Maintenance of Properties.
The Company will cause all material properties owned by the Company
or any Subsidiary or used or held for use in the conduct of its business or
the business of any Subsidiary to be maintained and kept in good condition,
repair and working order (ordinary wear and tear excepted) and supplied with
all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Company may be consistent with sound business practice and
reasonably necessary so that the business carried on in connection therewith
may be properly conducted at all times; provided, however, that nothing in
this Section 10.6 shall prevent the Company from discontinuing the maintenance
of any of such properties if such discontinuance is, in the judgment of the
Company, desirable in the conduct of the business of the Company and its
Subsidiaries and not reasonably expected to have a material adverse effect on
the ability of the Company to perform its obligations hereunder.
Section 10.7. Insurance.
The Company will at all times keep all of its and its Subsidiaries'
properties which are of an insurable nature reasonably self-insured or insured
with insurers, believed by the Company to be responsible, against loss or
damage to the extent that property of similar character is usually so insured
by corporations similarly situated and owning like properties in the same
general geographic areas in which the Company and its Subsidiaries operate,
except where the failure to do so would not reasonably be expected to have a
material adverse effect on the condition (financial or otherwise), earnings or
business affairs of the Company and its Subsidiaries, taken as a whole.
Section 10.8. Limitation on Indebtedness.
(a) The Company will not, and will not permit any of its
Subsidiaries to, create, issue, assume, guarantee, or otherwise in any manner
become directly or indirectly liable for or with respect to or otherwise incur
(collectively, "incur") any Indebtedness, including any Acquired Indebtedness
(other than Permitted Indebtedness); provided, however, and subject to
paragraph (b) below in the case of Indebtedness of any Subsidiary, the Company
and its Subsidiaries will be permitted to incur Indebtedness if the
Consolidated Fixed Charge Coverage Ratio for the Company for the four full
fiscal quarters immediately preceding the incurrence of such Indebtedness
taken as one period (and after giving pro forma effect to (i) the incurrence
of such Indebtedness and (if applicable) the application of the net proceeds
therefrom, including to refinance other Indebtedness, as if such Indebtedness
was incurred, and the application of such proceeds occurred, at the beginning
of such four-quarter period; (ii) the incurrence, repayment or retirement of
any other Indebtedness by the Company and its Subsidiaries since the first day
of such four-quarter period as if such Indebtedness was incurred, repaid or
retired at the beginning of such four-quarter period (except that, in making
such computation, the amount of Indebtedness under any revolving credit
facility shall be computed based upon the average daily balance of such
Indebtedness during such four-quarter period); (iii) in the case of Acquired
Indebtedness, the related acquisition; and (iv) any acquisition or disposition
by the Company and its Subsidiaries of any company or any business or any
assets out of the ordinary course of business, or any related repayment of
Indebtedness, in each case since the first day of such four- quarter period,
assuming such acquisition or disposition and any such related prepayment had
been consummated on the first day of such four-quarter period) is at least
equal to 2.00 to 1.00 during the period from the date hereof to the second
anniversary of the date hereof, and 2.25 to 1.00 thereafter (each such ratio
defined herein as the "Applicable Coverage Ratio").
(b) The Company will not permit any of its Subsidiaries to incur
any Indebtedness other than Permitted Subsidiary Indebtedness.
Section 10.9. Limitation on Restricted Payments.
(a) The Company will not, and will not permit any Subsidiary to,
directly or indirectly:
(i) declare or pay any dividend on, or make any
distribution to holders of, any shares of the Company's Capital Stock (other
than dividends or distributions payable solely in shares of its Qualified
Capital Stock or in options, warrants or other rights to acquire such
Qualified Capital Stock;
(ii) purchase, redeem or otherwise acquire or retire for
value, directly or indirectly, any shares of the Capital Stock of the Company
or any Affiliate of the Company (other than the Capital Stock of any
Wholly-Owned Subsidiary of the Company) or options, warrants or other rights
to acquire such Capital Stock;
(iii) make any principal payment on, or repurchase, redeem,
defease, retire or otherwise acquire for value, prior to any scheduled
principal payment, sinking fund or maturity, any Subordinated Indebtedness;
(iv) declare or pay any dividend or distribution on any
Capital Stock of any Subsidiary to any Person (other than the Company or any
of its Wholly-Owned Subsidiaries) or purchase, redeem or otherwise acquire or
retire for value any Capital Stock of any Subsidiary held by any Person (other
than the Company or any of its Wholly-Owned Subsidiaries);
(v) incur, create or assume any guarantee of Indebtedness
of any Affiliate of the Company (other than a Wholly-Owned Subsidiary of the
Company); or
(vi) make any Investment in any Person (other than any
Permitted Investments)
(any of the foregoing payments described in clauses (i) through (vi) and not
excepted therefrom, collectively, "Restricted Payments") unless after giving
effect to the proposed Restricted Payment (the amount of any such Restricted
Payment, if other than cash, as determined by the Board of Directors of the
Company, whose determination shall be conclusive and evidenced by a board
resolution), (1) no Default or Event of Default shall have occurred and be
continuing and such Restricted Payment shall not be an event which is, or
after notice or lapse of time or both, would be, an "event of default" under
the terms of any Indebtedness of the Company or its Subsidiaries; (2)
immediately before and immediately after giving effect to such transaction on
a pro forma basis, the Company could incur $1.00 of additional Indebtedness
(other than Permitted Indebtedness) under the provisions described under
Section 10.8; and (3) the aggregate amount of all such Restricted Payments
declared or made after the date of the Indenture does not exceed the sum of:
(A) 50% of the aggregate cumulative Consolidated Net Income
of the Company accrued on a cumulative basis during the period beginning on
the first day of the Company's fiscal quarter commencing prior to the date of
the Indenture and ending on the last day of the Company's last fiscal quarter
ending prior to the date of the Restricted Payment (or, if such aggregate
cumulative Consolidated Net Income shall be a loss, minus 100% of such loss);
plus
(B) the aggregate Net Cash Proceeds received after the date
of the Indenture by the Company as capital contributions to the Company (other
than from any of its Subsidiaries); plus
(C) the aggregate Net Cash Proceeds received after the date
of the Indenture by the Company from the issuance or sale (other than to any
of its Subsidiaries) of its shares of Qualified Capital Stock or any options,
warrants or rights to purchase such shares of Qualified Capital Stock of the
Company (except, in each case, to the extent such proceeds are used to
purchase, redeem or otherwise retire Capital Stock or Pari Passu or
Subordinated Indebtedness as set forth below); plus
(D) the aggregate Net Cash Proceeds received after the date
of the Indenture by the Company (other than from any of its Subsidiaries) upon
the exercise of any options or warrants to purchase shares of Qualified
Capital Stock of the Company; plus
(E) the aggregate Net Cash Proceeds received after the date
of the Indenture by the Company from debt securities or Redeemable Capital
Stock that have been converted into or exchanged for Qualified Capital Stock
of the Company, to the extent such debt securities or Redeemable Capital Stock
are originally sold for cash, plus the aggregate Net Cash Proceeds received by
the Company at the time of such conversion or exchange.
(b) Notwithstanding the foregoing, and in the case of clauses
(ii), (iii) and (iv) below, as long as no Default shall have occurred and be
continuing, the foregoing provisions shall not prohibit:
(i) the payment of any dividend within 60 days after the
date of declaration thereof, if at such date of declaration such payment would
be permitted by the provisions of paragraph (a) of this Section or paragraph
(vi) below and such payment shall be deemed to have been paid on such date of
declaration for purposes of the calculation required by paragraph (a) of this
Section;
(ii) the repurchase, redemption, or other acquisition or
retirement of any shares of any class of Capital Stock of the Company in
exchange for (including any such exchange pursuant to the exercise of a
conversion right or privilege in connection with which cash is paid in lieu of
the issuance of fractional shares or scrip), or out of the Net Cash Proceeds
of, a substantially concurrent issuance and sale for cash (other than to a
Subsidiary) of other shares of Qualified Capital Stock of the Company;
provided that the Net Cash Proceeds from the issuance of such shares of
Qualified Capital Stock are excluded from the calculation pursuant to clause
(3)(C) of paragraph (a) of this Section;
(iii) any repurchase, redemption, defeasance, retirement or
acquisition for value or payment of principal of any Subordinated Indebtedness
in exchange for, or out of the net proceeds of, a substantially concurrent
issuance and sale for cash (other than to any Subsidiary of the Company) of
any Qualified Capital Stock of the Company provided that the Net Cash Proceeds
from the issuance of such shares of Qualified Capital Stock are excluded from
clause (3)(C) of paragraph (a) of this Section;
(iv) the repurchase, redemption, defeasance, retirement,
refinancing, acquisition for value or payment of principal of any Subordinated
Indebtedness (other than Redeemable Capital Stock) (a "refinancing") through
the issuance of new Subordinated Indebtedness provided that any such new
Subordinated Indebtedness (1) shall be in a principal amount that does not
exceed the principal amount so refinanced (or, if such Subordinated
Indebtedness provides for an amount less than the principal amount thereof to
be due and payable upon a declaration or acceleration thereof, then such
lesser amount as of the date of determination), plus the lesser of (I) the
stated amount of any premium or other payment required to be paid in
connection with such a refinancing pursuant to the terms of the Subordinated
Indebtedness being refinanced or (II) the amount of premium or other payment
actually paid at such time to refinance the Subordinated Indebtedness, plus,
in either case, the amount of expenses of the Company incurred in connection
with such refinancing; (2) has an Average Life to Stated Maturity greater than
the remaining Average Life to Stated Maturity of the Securities; (3) has a
Stated Maturity for its final scheduled principal payment later than the
Stated Maturity for the final scheduled principal payment of the Securities;
and (4) is expressly subordinated in right of payment to the Securities at
least to the same extent as the Subordinated Indebtedness to be refinanced;
(v) the redemption by the Company of its 13 % Senior
Subordinated Notes due 1999 within 45 days after the date of the Indenture;
(vi) the declaration and payment of dividends on the
Capital Stock of the Company of up to an amount equal to 6% of the proceeds
(after underwriting discounts, commissions, and issuance expenses) received at
any time from any public offering of such Capital Stock; and
(vii) distributions to Holdings to enable Holdings to
repurchase Capital Stock or options to purchase Capital Stock of Holdings from
current or former directors, officers and employees (or their respective
estates and beneficiaries) pursuant to put rights held by them as a result of
death, disability, retirement or termination of employment (including, without
limitation, any interest and other expenses related thereto) up to an amount
not to exceed an aggregate of $500,000 in any fiscal year of the Company.
Section 10.10. Limitation on Transactions with Affiliates.
The Company will not, and will not permit any of its Subsidiaries
to, directly or indirectly, enter into or suffer to exist any transaction or
series of related transactions (including, without limitation, the sale,
purchase, exchange or lease of assets, property or services) with any
Affiliate of the Company (other than the Company or a Wholly-Owned Subsidiary)
unless (i) such transaction or series of transactions is in writing on terms
that are no less favorable to the Company or such Subsidiary, as the case may
be, than would be available in a comparable transaction in arm's-length
dealings with an unrelated third party and (ii) with respect to any
transaction or series of transactions involving aggregate payments or value in
excess of $1,000,000, the Company delivers an Officers' Certificate to the
Trustee certifying that such transaction or series of related transactions
complies with clause (i) above and such transaction or series of related
transactions has been approved by a majority of the Disinterested Directors of
the Board of Directors of the Company. In addition to the foregoing, with
respect to a transaction or series of related transactions involving aggregate
payments or value equal to or greater than $2.5 million, the Company must
deliver to the Trustee a written opinion from an Independent Financial Advisor
stating that such transaction or series of transactions are fair from a
financial point of view. This covenant will not restrict the Company from (a)
redeeming or paying dividends in respect of its Capital Stock permitted under
Section 10.9 hereunder, (b) making loans or advances to officers of the
Company for bona fide business purposes of the Company not in excess of $1.0
million in the aggregate at any one time outstanding, and (c) paying advisory
and transaction fees to MLGA in amounts that are in accordance with past
practices and in the ordinary course of business for the rendering of
financial advice and services in connection with acquisitions, dispositions,
and financings by the Company.
Section 10.11. Limitation on Liens.
The Company will not, and will not permit any Subsidiary to,
directly or indirectly, create, incur, affirm or suffer to exist any Lien of
any kind upon any of its property or assets (including any intercompany
notes), now owned or acquired after the date of this Indenture, or any income
or profits therefrom, except if the Securities are directly secured equally
and ratably with (or prior to in the case of Liens with respect to
Subordinated Indebtedness) the obligation or liability secured by such Lien,
excluding, however, from the operation of the foregoing any of the following:
(a) any Lien existing as of the date of this Indenture;
(b) any Lien arising by reason of (1) any judgment, decree
or order of any court, so long as such Lien is adequately bonded and any
appropriate legal proceedings which may have been duly initiated for the
review of such judgment, decree or order shall not have been finally
terminated or the period within which such proceedings may be initiated shall
not have expired; (2) taxes not yet delinquent or which are being contested in
good faith; (3) security for payment of workers' compensation or other
insurance; (4) good faith deposits in connection with tenders, leases,
contracts (other than contracts for the payment of money); (5) zoning
restrictions, easements, licenses, reservations, title defects, rights of
others for rights of way, utilities, sewers, electric lines, telephone or
telegraph lines, and other similar purposes, provisions, covenants,
conditions, waivers, restrictions on the use of property or minor
irregularities of title (and with respect to leasehold interests, mortgages,
obligations, liens and other encumbrances incurred, created, assumed or
permitted to exist and arising by, through or under a landlord or owner of the
leased property, with or without consent of the lessee), none of which
materially impairs the use of any parcel of property material to the operation
of the business of the Company or any Subsidiary or the value of such property
for the purpose of such business; (6) deposits to secure public or statutory
obligations, or in lieu of surety or appeal bonds, or (7) operation of law in
favor of mechanics, materialmen, laborers, employees or suppliers, incurred in
the ordinary course of business for sums which are not yet delinquent or are
being contested in good faith by negotiations or by appropriate proceedings
which suspend the collection thereof;
(c) any Lien on property of the Company or any Subsidiary
securing the New Credit Facility;
(d) any Lien securing Acquired Indebtedness created prior
to (and not created in connection with, or in contemplation of) the incurrence
of such Indebtedness by the Company or any Subsidiary;
(e) any Lien to secure the performance of bids, trade
contracts, leases (including, without limitation, statutory and common law
landlord's liens), statutory obligations, surety and appeal bonds, letters of
credit and other obligations of a like nature and incurred in the ordinary
course of business of the Company or any Subsidiary;
(f) any Lien securing Indebtedness permitted to be incurred
pursuant to clause (vi) of the definition of "Permitted Indebtedness" and
which is not prohibited to be incurred under Section 10.8;
(g) any Lien securing obligations under hedging agreements
that the Company enters into in the ordinary course of business for the
purpose of protecting its production against fluctuations in commodity prices;
(h) any Lien securing Indebtedness permitted to be incurred
under Interest Rate Agreements or otherwise incurred to hedge interest rate
risk;
(i) any extension, renewal, refinancing or replacement, in
whole or in part, of any Lien described in the foregoing clauses (a) through
(h) so long as no additional collateral is granted as security thereby.
Section 10.12. Limitation on Sale of Assets.
(a) The Company will not, and will not permit any of its
Subsidiaries to, directly or indirectly, consummate an Asset Sale unless (i)
at least 85% of the proceeds from such Asset Sale are received in cash and
(ii) the Company or such Subsidiary receives consideration at the time of such
Asset Sale at least equal to the Fair Market Value of the shares or assets
sold (as determined by the Board of Directors of the Company and evidenced in
a board resolution).
(b) If all or a portion of the Net Cash Proceeds of any Asset
Sale are not required to be applied to repay permanently any Indebtedness
under the New Credit Facility then outstanding, the Company determines not to
apply such Net Cash Proceeds to the permanent prepayment of such Indebtedness
under the New Credit Facility or if no such Indebtedness under the New Credit
Facility is then outstanding, then the Company may within 6 months of the
Asset Sale, invest the Net Cash Proceeds in properties and assets that (as
determined by the Board of Directors) replace the properties and assets that
were the subject of the Asset Sale or in properties and assets that will be
used in the businesses of the Company or its Subsidiaries existing on the date
of the Indenture or reasonably related thereto. The amount of such Net Cash
Proceeds neither used to permanently repay or prepay Indebtedness under the
New Credit Facility nor used or invested as set forth in this paragraph
constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds equals $5.0
million or more, the Company shall within 20 business days apply the Excess
Proceeds to the repayment of the Securities and any Pari Passu Indebtedness
required to be repurchased under the instrument governing such Pari Passu
Indebtedness as follows: (a) the Company shall make an offer to purchase (an
"Offer") from all holders of the Securities in accordance with the procedures
set forth in this Indenture the maximum principal amount (expressed as a
multiple of $1,000) of Securities that may be purchased out of an amount (the
"Security Amount") equal to the product of such Excess Proceeds multiplied by
a fraction, the numerator of which is the outstanding principal amount of the
Securities, and the denominator of which is the sum of the outstanding
principal amount of the Securities and such Pari Passu Indebtedness (subject
to proration in the event such amount is less than the aggregate Offered Price
(as defined herein) of all Securities tendered) and (b) to the extent required
by such Pari Passu Indebtedness to reduce permanently the principal amount of
such Pari Passu Indebtedness, the Company shall make an offer to purchase or
otherwise repurchase or redeem Pari Passu Indebtedness (a "Pari Passu Offer")
in an amount (the "Pari Passu Debt Amount") equal to the excess of the Excess
Proceeds over the Security Amount; provided that in no event shall the Pari
Passu Debt Amount exceed the principal amount of such Pari Passu Indebtedness
plus the amount of any premium required to be paid to repurchase such Pari
Passu Indebtedness. The offer price shall be payable in cash in an amount
equal to 100% of the principal amount of the Securities plus accrued and
unpaid interest, if any, to the date (the "Offer Date") such Offer is
consummated (the "Offered Price"), in accordance with the procedures set forth
in this Indenture. To the extent that the aggregate Offered Price of the
Securities tendered pursuant to the Offer is less than the Security Amount
relating thereto or the aggregate amount of Pari Passu Indebtedness that is
purchased is less than the Pari Passu Debt Amount (the amount of such
shortfall, if any, constituting a "Deficiency"), the Company shall use such
Deficiency in the business of the Company and its Subsidiaries. Upon
completion of the purchase of all the Securities tendered pursuant to an Offer
and repurchase of the Pari Passu Indebtedness pursuant to a Pari Passu Offer,
the amount of Excess Proceeds, if any, shall be reset at zero.
(d) Whenever the Excess Proceeds received by the Company exceed
$5.0 million, such Excess Proceeds shall, prior to the purchase of Securities
or any Pari Passu Indebtedness described in paragraph (c) above, be set aside
by the Company in a separate account pending (i) deposit with the depository
or a paying agent of the amount required to purchase the Securities or Pari
Passu Indebtedness tendered in an Offer or a Pari Passu Offer, (ii) delivery
by the Company of the Offered Price to the holders of the Securities or Pari
Passu Indebtedness tendered in an Offer or a Pari Passu Offer and (iii)
application, as set forth above, of Excess Proceeds in the business of the
Company and its Subsidiaries. Such Excess Proceeds may be invested in
Temporary Cash Investments, provided that the maturity date of any such
investment made after the amount of Excess Proceeds exceeds $5.0 million shall
not be later than the Offer Date. The Company shall be entitled to any
interest or dividends accrued, earned or paid on such Temporary Cash
Investments, provided that the Company shall not withdraw such interest from
the separate account if an Event of Default has occurred and is continuing.
(e) If the Company becomes obligated to make an Offer pursuant
to clause (c) above, the Securities shall be purchased by the Company, at the
option of the holders thereof, in whole or in part in integral multiples of
$1,000, on a date that is not earlier than 45 days and not later than 60 days
from the date the notice is given to holders, or such later date as may be
necessary for the Company to comply with the requirements under the Exchange
Act, subject to proration in the event that the Security Amount is less than
the aggregate Offered Price of all Securities tendered.
(f) The Company shall comply with the applicable tender offer
rules, including Rule 14e-1 under the Exchange Act, and any other applicable
securities laws or regulations in connection with an Offer.
(g) The Company will not, and will not permit any Subsidiary to,
create or permit to exist or become effective any restriction (other than
restrictions existing under Indebtedness as in effect on the date of the
Indenture as such Indebtedness may be refinanced from time to time) that would
materially impair the ability of the Company to make an Offer to purchase the
Securities or, if such Offer is made, to pay for the Securities tendered for
purchase.
(h) Within 20 business days after the date on which the amount
of Excess Proceeds equals or exceeds $5.0 million the Company shall send by
first-class mail, post prepaid, to the Trustee and to each Holder of the
Securities, at such Holder's address appearing in the Security Register, a
notice stating or including:
(A) that the Holder has the right to require the Company to
repurchase, subject to proration, part or all of such Holder's Securities at
the Offered Price;
(B) the Offer Date;
(C) the instructions a Holder must follow in order to have
its Securities purchased in accordance with paragraph (c) of this Section; and
(D) (i) the most recently filed Annual Report on Form 10-K
(including audited consolidated financial statements) of the Company, the most
recent subsequently filed Quarterly Report on Form 10-Q, as applicable, and
any Current Report on Form 8-K of the Company filed subsequent to such
Quarterly Report, other than Current Reports describing Asset Sales otherwise
described in the offering materials (or corresponding successor reports) (or
in the event the Company is not required to prepare any of the foregoing
Forms, the comparable information required pursuant to Section 10.17), (ii) a
description of material developments in the Company's business subsequent to
the date of the latest of such Reports, (iii) if material, appropriate pro
forma financial information, and (iv) such other information, if any,
concerning the business of the Company and its Subsidiaries which the Company
in good faith believes will enable such Holders to make an informed investment
decision regarding the Offer;
(E) the Offered Price;
(F) the names and addresses of the Paying Agent and the
offices or agencies referred to in Section 10.2;
(G) that Securities must be surrendered at least three
Business Days prior to the Purchase Date to the Paying Agent or to an office
or agency referred to in Section 10.2 to collect payment;
(H) that any Securities not tendered will continue to
accrue interest and that unless the Company defaults in the payment of the
Offered Price, any Security accepted for payment pursuant to the Offer shall
cease to accrue interest on and after the Offer Date; and
(I) the procedures for withdrawing a tender.
(i) Holders electing to have Securities purchased hereunder will
be required to surrender such Securities at the address specified in the
notice at least three Business Days prior to the Offer Date. Holders will be
entitled to withdraw their election to have their Securities purchased
pursuant to this Section 10.12 if the Company receives, not later than three
Business Days prior to the Offer Date, a telegram, telex, facsimile
transmission or letter setting forth (1) the name of the Holder, (2) the
certificate number of the Security in respect of which such notice of
withdrawal is being submitted, (3) the principal amount of the Security (which
shall be $1,000 or an integral multiple thereof) delivered for purchase by the
Holder as to which his election is to be withdrawn, (4) a statement that such
Holder is withdrawing such Holder's election to have such principal amount of
such Security purchased, and (5) the principal amount, if any, of such
Security (which shall be $1,000 or an integral multiple thereof) that remains
subject to the original notice of the Offer and that has been or will be
delivered for purchase by the Company.
(j) The Company shall (i) not later than the Offer Date, accept
for payment Securities or portions thereof tendered pursuant to the Offer,
(ii) not later than 10:00 a.m. (New York time) on the Offer Date, deposit with
the Trustee or with a Paying Agent an amount of money in same day funds (or
New York Clearing House funds if such deposit is made prior to the Offer Date)
the lesser of the Security Amount and an amount sufficient to pay the
aggregate Offered Price of all the Securities or portions thereof which are to
be purchased on that date and (iii) not later than 10:00 a.m. (New York Time)
on the Offer Date, deliver to the Paying Agent an Officers' Certificate
stating the Securities or portions thereof accepted for payment by the
Company.
The Trustee and the Paying Agent shall return to the Company any
cash that remains unclaimed after the Business Day following the Offer Date,
together with interest, if any, thereon, held by them for the payment of the
Offered Price; provided, however, that, (x) to the extent that the aggregate
amount of cash deposited by the Company with the Trustee in respect of an
Offer exceeds the aggregate Offered Price of the Securities or portions
thereof to be purchased, then the Trustee shall hold such excess for the
Company and (y) unless otherwise directed by the Company in writing, promptly
after the Business Day following the Offer Date the Trustee shall return any
such excess to the Company together with interest or dividends, if any,
thereon.
(k) Securities to be purchased shall, on the Offer Date, become
due and payable at the Offered Price and from and after such date (unless the
Company shall default in the payment of the Offered Price) such Securities
shall cease to bear interest. The Offered Price shall be paid to such Holder
promptly following the later of the Offer Date and the time of delivery of
such Security to the relevant Paying Agent at the office of such Paying Agent
by the Holder thereof in the manner required. Upon surrender of any such
Security for purchase in accordance with the foregoing provisions, such
Security shall be paid by the Company at the Offered Price; provided, however,
that installments of interest whose Stated Maturity is on or prior to the
Offer Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Regular Record
Dates according to the terms and the provisions of Section 3.7; provided,
further, that Securities to be purchased are subject to proration in the event
the Security Amount is less than the aggregate Offered Price of all Securities
tendered for purchase, with such adjustments as may be appropriate by the
Trustee so that only Securities in denominations of $1,000 or integral
multiples thereof shall be purchased. If any Security tendered for purchase
in accordance with the terms of this Section shall not be so paid upon
surrender thereof by deposit of funds with the Trustee or a Paying Agent in
accordance with paragraph (j) above, the principal thereof (and premium, if
any, thereon) shall, until paid, bear interest from the Offer Date at the rate
borne by such Security. Any Security that is to be purchased only in part
shall be surrendered to a Paying Agent in accordance with the terms of this
Section at the office of such Paying Agent (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Company and the Trustee duly executed by, the
Holder thereof or such Holder's attorney duly authorized in writing), and the
Company shall execute and the trustee shall authenticate and deliver to the
Holder of such Security, without service charge, one or more new Securities of
any authorized denomination as requested by such Holder in an aggregate
principal amount equal to, and in exchange for, the portion of the principal
amount of the Security so surrendered that is not purchased.
Section 10.13. Purchase of Securities upon a Change of Control.
(a) If a Change of Control shall occur at any time, then each
Holder shall have the right to require that the Company purchase such Holder's
Securities, pursuant to an offer described in subsection (b) of this Section
(a "Change of Control Offer"), in whole or in part in integral multiples of
$1,000, at a purchase price (the "Change of Control Purchase Price") in cash
in an amount equal to 101% of the principal amount of such Securities, plus
accrued and unpaid interest, if any, to the date of purchase (the "Change of
Control Purchase Date"), in accordance with the procedures set forth in
paragraphs (b), (c), (d) and (e) of this Section.
(b) Within 30 days following any Change of Control, the Company
shall notify the Trustee thereof and give written notice (a "Change of Control
Purchase Notice") of such Change of Control to each Holder by first-class
mail, postage prepaid, to the Trustee and to each Holder, at his address
appearing in the Security Register stating or including:
(A) that a Change of Control has occurred, the date of such
event, and that such Holder has the right to require the Company to repurchase
such Holder's Securities at the Change of Control Purchase Price;
(B) the circumstances and relevant facts regarding such
Change of Control (including but not limited to information with respect to
pro forma historical income, cash flow and capitalization after giving effect
to such Change of Control, if any);
(C) that the Change of Control Offer is being made pursuant
to Section 10.13(a) and that all Securities properly tendered pursuant to the
Change of Control Offer will be accepted for payment at the Change of Control
Offer Purchase Price;
(D) the Change of Control Purchase Date which shall be a
Business Day no earlier than 30 days nor later than 60 days from the date such
notice is mailed or such later date as may be necessary for the Company to
comply with the requirements under the Exchange Act;
(E) (i) the most recently filed Annual Report on Form 10-K
(including audited consolidated financial statements) of the Company, the most
recent subsequently filed Quarterly Report on Form 10-Q, as applicable, and
any Current Report on Form 8-K of the Company filed subsequent to such
Quarterly Report (or in the event the Company is not required to prepare any
of the foregoing Forms, the comparable information required to be prepared by
the Company pursuant to Section 10.17), (ii) a description of material
developments in the Company's business subsequent to the date of the latest of
such reports and (iii) such other information, if any, concerning the business
of the Company and its Subsidiaries which the Company in good faith believes
will enable such Holders to make an informed investment decision regarding the
Change of Control Offer;
(F) the Change of Control Purchase Price;
(G) the names and addresses of the Paying Agent and the
offices or agencies referred to in Section 10.2;
(H) that Securities must be surrendered at least three
Business Days prior to the Change of Control Purchase Date to the Paying Agent
at the office of the Paying Agent or to an office or agency referred to in
Section 10.2 to collect payment;
(I) that the Change of Control Purchase Price for any
Security which has been properly tendered and not withdrawn will be paid
promptly following the Change of Control Purchase Date;
(J) the procedures for withdrawing a tender of Securities
and Change of Control Purchase Notice;
(K) that any Security not tendered will continue to accrue
interest; and
(L) that, unless the Company defaults in the payment of the
Change of Control Purchase Price, any Security accepted for payment pursuant
to the Change of Control Offer shall cease to accrue interest on and after the
Change of Control Purchase Date.
(c) Upon receipt by the Company of the proper tender of
Securities, each Holder of a Security in respect of which such proper tender
was made shall (unless the tender of such Security is properly withdrawn)
thereafter be entitled to receive solely the Change of Control Purchase Price
with respect to such Security. Upon surrender of any such Security for
purchase in accordance with the foregoing provisions, such Security shall be
paid by the Company at the Change of Control Purchase Price; provided,
however, that installments of interest whose Stated Maturity is on or prior to
the Change of Control Purchase Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such on the
relevant Regular Record Dates according to the terms and the provisions of
Section 3.7. If any Security tendered for purchase in accordance with the
provisions of this Section shall not be so paid upon surrender thereof by
deposit of funds with the Paying Agent in accordance with paragraph (d) below,
the principal thereof (and premium, if any, thereon) shall, until paid, bear
interest from the Change of Control Purchase Date at the rate borne by such
Security. Holders electing to have Securities purchased will be required to
surrender such Securities to the Paying Agent at the address specified in the
notice at least three Business Days prior to the Change of Control Purchase
Date. Any Security that is to be purchased only in part shall be surrendered
to a Paying Agent in accordance with the provisions of this Section at the
office of such Paying Agent (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory
to the Company and the Trustee duly executed by, the Holder thereof or such
Holder's attorney duly authorized in writing), and the Company shall execute
and the Trustee shall authenticate and deliver to the Holder of such Security,
without service charge, one or more new Securities of any authorized
denomination as requested by such Holder in an aggregate principal amount
equal to, and in exchange for, the portion of the principal amount of the
Security so surrendered that is not purchased.
(d) The Company shall (i) not later than the Change of Control
Purchase Date, accept for payment Securities or portions thereof tendered
pursuant to the Change of Control Offer, (ii) not later than 10:00 a.m. (New
York time) on the Change of Control Purchase Date, deposit with Paying Agent
an amount of cash sufficient to pay the aggregate Change of Control Purchase
Price of all the Securities or portions thereof which are to be purchased as
of the Change of Control Purchase Date and (iii) not later than 10:00 a.m.
(New York time) on the Change of Control Purchase Date, deliver to the Paying
Agent an Officers' Certificate stating the Securities or portions thereof
accepted for payment by the Company. The Paying Agent shall promptly mail or
deliver to Holders of Securities so accepted payment in an amount equal to the
Change of Control Purchase Price of the Securities purchased from each such
Holder. Any Securities not so accepted shall be promptly mailed or delivered
by the Paying Agent at the Company's expense to the Holder thereof. The
Company will publicly announce the results of the Change of Control Offer on
the Change of Control Purchase Date. For purposes of this Section 10.13 the
Company shall choose a Paying Agent which shall not be the Company.
(e) A tender made in response to a Change of Control Purchase
Notice may be withdrawn before or after delivery by the Holder to the Paying
Agent at the office of the Paying Agent of the Security to which such Change
of Control Purchase Notice relates, by means of a written notice of withdrawal
delivered by the Holder to the Paying Agent at the office of the Paying Agent
or to the office or agency referred to in Section 10.2 to which the related
Change of Control Purchase Notice was delivered not later than three Business
Days prior to the Change of Control Purchase Date specifying, as applicable:
(1) the name of the Holder;
(2) the certificate number of the Security in respect of
which such notice of withdrawal is being submitted;
(3) the principal amount of the Security (which shall be
$1,000 or an integral multiple thereof) delivered for purchase by the Holder
as to which such notice of withdrawal is being submitted;
(4) a statement that such Holder is withdrawing such
Holder's election to have such principal amount of such Security purchased;
and
(5) the principal amount, if any, of such Security (which
shall be $1,000 or an integral multiple thereof) that remains subject to the
original Change of Control Purchase Notice and that has been or will be
delivered for purchase by the Company.
(f) The Trustee and the Paying Agent shall return to the Company
any cash that remains unclaimed, together with interest or dividends, if any,
thereon, held by them for the payment of the Change of Control Purchase Price;
provided, however, that (x) to the extent that the aggregate amount of cash
deposited by the Company pursuant to clause (ii) of paragraph (d) above
exceeds the aggregate Change of Control Purchase Price of the Securities or
portions thereof to be purchased, then the Trustee shall hold such excess for
the Company and (y) unless otherwise directed by the Company in writing,
promptly after the Business Day following the Change of Control Purchase Date,
the Trustee shall return any such excess to the Company together with
interest, if any, thereon.
(g) The Company shall comply with the applicable tender offer
rules, including Rule 14e-1 under the Exchange Act, and any other applicable
securities laws or regulations in connection with a Change of Control Offer.
(h) Notwithstanding the occurrence of a Change of Control, the
Company shall not be obligated to repurchase the Securities pursuant to a
Change of Control Offer, or otherwise comply with this Section 10.13, if the
Company has elected to redeem all of the Securities in accordance with Article
XI.
Section 10.14. Optional Redemption Upon Change of Control.
The Securities will be redeemable, at the option of the Company, in
whole or in part at any time within 180 days after a Change of Control upon
not less than 30 nor more than 60 days' prior notice to each holder of the
Securities to be redeemed, at a redemption price equal to the sum of (i) the
then outstanding principal amount thereof plus (ii) accrued and unpaid
interest, if any, to the redemption date plus (iii) the Applicable Premium.
Any optional redemption by the Company upon a Change of Control shall be
effected in accordance with the redemption procedures set forth in Article XI
hereof.
"Applicable Premium" with respect to the Securities is defined as
the greater of (i) 1.0% of the then outstanding principal amount of such
Securities and (ii) the excess of (A) the present value of the required
interest and principal payments due on such Securities, computed using a
discount rate equal to the Treasury Rate plus the Applicable Spread, over (B)
the then outstanding principal amount of such Securities.
"Applicable Spread" is defined as 75 basis points.
"Treasury Rate" is defined as the yield to maturity at the time of
computation of United States Treasury securities with a constant maturity (as
compiled by and published in the most recent Federal Reserve Statistical
Release H.15(519) which has become publicly available at least two business
days prior to the date fixed for prepayment (or, if such Statistical Release
is no longer published, any publicly available source of similar market data))
most nearly equal to the then remaining Average Life of the Securities;
provided, that if the Average Life of the Securities is not equal to the
constant maturity of a United States Treasury security for which a weekly
average yield is given, the Treasury Rate shall be obtained by linear
interpolation (calculated to the nearest one-twelfth of a year) from the
weekly average yields of United States Treasury securities for which such
yields are given, except that if the Average Life of the Securities is less
than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year shall be used.
Section 10.15. Limitation on Issuance and Sale of Preferred Stock
of Subsidiaries.
The Company will not permit (a) any Subsidiary of the Company to
issue any Preferred Stock (other than to the Company or any Wholly-Owned
Subsidiary) or (b) any Person (other than the Company or any Wholly-Owned
Subsidiary) to own any Preferred Stock of any Subsidiary.
Section 10.16. Limitation on Dividends and Other Payment
Restrictions Affecting 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 or
become effective any encumbrance or restriction on the ability of any
Subsidiary of the Company to (i) pay dividends, in cash or otherwise, or make
any other distribution on its Capital Stock, (ii) pay any Indebtedness owed to
the Company or a Subsidiary of the Company, (iii) make any Investment in the
Company or a Subsidiary of the Company or (iv) transfer any of its properties
or assets to the Company or any Subsidiary, except (a) any encumbrance or
restriction pursuant to an agreement in effect on the date of the Indenture
and listed on Schedule I hereto; (b) any encumbrance or restriction, with
respect to a Subsidiary that is not a Subsidiary of the Company on the date of
the Indenture, in existence at the time such Person becomes a Subsidiary of
the Company and, in the case of clauses (a) and (b), not incurred in
connection with, or in contemplation of, such Person becoming a Subsidiary;
and (c) any encumbrance or restriction existing under any agreement that
extends, renews, refinances or replaces the agreements containing the
encumbrances or restrictions in the foregoing clauses (a) and (b), or in this
clause (c); provided that the terms and conditions of any such encumbrances or
restrictions are not materially less favorable to the holders of the
Securities than those under or pursuant to the agreement evidencing the
Indebtedness so extended, renewed, refinanced or replaced.
Section 10.17. Provision of Financial Statements.
Whether or not the Company is subject to Section 13(a) or 15(d) of
the Exchange Act, the Company will, to the extent permitted under the Exchange
Act, file with the Commission the annual reports, quarterly reports and other
documents which the Company would have been required to file with the
Commission pursuant to such Section 13(a) or 15(d) if the Company were so
subject, such documents to be filed with the Commission 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 subject. The
Company will also in any event (x) 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 would have been required to file with the Commission
pursuant to Section 13(a) or 15(d) of the Exchange Act if the Company were
subject to such Sections and (y) if filing such documents by the Company with
the Commission is not permitted under the Exchange Act, promptly upon written
request and payment of the reasonable cost of duplication and delivery, supply
copies of such documents to any prospective holder of Securities.
Section 10.18. Statement by Officers as to Default.
(a) The Company will deliver to the Trustee, on or before a date
not more than 45 days after the end of each fiscal quarter and not more than
90 days after the end of each fiscal year of the Company ending after the date
hereof, a written statement signed by two executive officers of the Company,
one of whom shall be the principal executive officer, principal financial
offer or principal accounting officer of the Company, stating whether or not,
after a review of the activities of the Company during such year or such
quarter and of the Company's performance under this Indenture, to the best
knowledge, based on such review, of the signers thereof, the Company has
fulfilled all its obligations and is in compliance with all conditions and
covenants under this Indenture throughout such year or quarter, as the case
may be, and, if there has been a Default, specifying each Default and the
nature and status thereof.
(b) When any Default or Event of Default has occurred and is
continuing, or if the Trustee or any Holder or the trustee for or the holder
of any other evidence of Indebtedness of the Company or any Subsidiary gives
any notice or takes any other action with respect to a claimed default, the
Company shall deliver to the Trustee by registered or certified mail or by
telegram, telex or facsimile transmission followed by hard copy an Officers'
Certificate specifying such Default, Event of Default, notice or other action,
the status thereof and what action the Company is taking or proposes to take
with respect thereto, within five Business Days of its occurrence.
Section 10.19. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
covenant or condition set forth in Sections 10.5 through 10.11 and Section
10.15 through 10.17 if, before or after the time for such compliance, the
Holders of not less than a majority in aggregate principal amount of the
Securities at the time Outstanding waive such compliance in such instance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such covenant or condition shall
remain in full force and effect.
ARTICLE XI
REDEMPTION OF SECURITIES
Section 11.1. Right of Redemption.
The Securities may be redeemed, at the election of the Company, as a
whole at any time or from time to time in part, on or after September 1, 2000,
subject to the conditions and at the Redemption Prices specified in the form
of Security, together with accrued and unpaid interest, if any, to the
Redemption Date (subject to the right of Holders of record on relevant Regular
Record Dates and Special Record Dates to receive interest due on relevant
Interest Payment Dates). In addition, prior to September 1, 1999, in the
event one or more Public Equity Offerings of the Company are consummated, the
Company may redeem in the aggregate up to a maximum of 35% of the initial
aggregate principal amount of the Securities with the net proceeds thereof at
a Redemption Price equal to 111.625% of the principal amount thereof plus
accrued and unpaid interest to the Redemption Date; provided that, after
giving effect thereto, at least $85.0 million aggregate principal amount of
the Securities remain outstanding.
Section 11.2. Applicability of Article.
Redemption of Securities at the election of the Company or
otherwise, as permitted or required by any provision of this Indenture, shall
be made in accordance with such provision and this Article.
Section 11.3. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities pursuant to
Section 11.1 shall be evidenced by a Company Order and an Officers'
Certificate. In case of any redemption at the election of the Company, the
Company shall, not less than 45 nor more than 60 days prior to the Redemption
date fixed by the Company (unless a shorter notice period shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date and of the principal amount of Securities to be redeemed.
Section 11.4. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities or portions thereof to be redeemed shall be selected not more than
60 days prior to the Redemption Date by the Trustee (or such shorter period as
the Trustee may agree upon), from the Outstanding Securities not previously
called for redemption, by lot or such other method as the Trustee shall deem
fair and reasonable, and the amounts to be redeemed may be equal to $1,000 or
any integral multiple thereof.
The Trustee shall promptly notify the Company and each Security
Registrar in writing of the Securities selected for redemption and, in the
case of any Securities selected for partial redemption, the principal amount
thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Securities shall relate, in
the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security which has been or is to be
redeemed.
Notwithstanding anything else in this Section, any redemption
pursuant to the provisions relating to one or more Public Equity Offerings
shall be made on a pro rata basis or on as nearly a pro rata basis as
practicable (subject to any procedures of the Depositary).
Section 11.5. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at the address appearing in
the Security Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Securities are to be
redeemed, the identification of the particular Securities to be redeemed;
(d) in the case of a Security to be redeemed in part, 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 the
aggregate principal amount equal to the unredeemed portion thereof will be
issued;
(e) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price;
(f) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security or portion thereof to be
redeemed, and that (unless the Company shall default in payment of the
Redemption Price) interest thereon shall cease to accrue on and after said
date;
(g) the place or places where such Securities are to be
surrendered for payment of the Redemption Price; and
(h) the CUSIP number, if any, relating to such Securities.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's written
request, by the Trustee in the name and at the expense of the Company. If the
Company elects to give notice of redemption, it shall provide the Trustee with
a certificate stating that such notice has been given in compliance with the
requirements of this Section 11.5.
Such notice if mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect
in the notice to the Holder of any Security designated for redemption as a
whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.
Section 11.6. Deposit of Redemption Price.
On or prior to 10:00 a.m. (New York time) on the Business Day
preceding any Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent an amount of money in same day funds sufficient to pay the
Redemption Price of, and, except if the Redemption Date shall be an Interest
Payment Date, accrued interest on, all the Securities or portions thereof
which are to be redeemed on that date. The Trustee or the Paying Agent shall
hold in trust for, and return to, the Company promptly after the Business Day
following the Redemption Date all interest or dividends, if any, earned on
amounts deposited with the Trustee or the Paying Agent remaining after the
payment of the aggregate Redemption Price for all securities to be redeemed.
Section 11.7. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall not have deposited funds in accordance with Section 11.6 in
respect of the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any such Security
for redemption in accordance with said notice, such Security shall be paid by
the Company at the Redemption Price together with accrued interest to the
Redemption Date; provided, however, that installments of interest whose Stated
Maturity is on or prior to the Redemption Date shall be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such
on the relevant Regular Record Dates according to the terms and the provisions
of Section 3.7.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, by deposit or segregation of funds in
accordance with Section 11.6, the principal and premium, if any, shall, until
paid, bear interest from the Redemption Date at the rate borne by such
Security.
Section 11.8. Securities Redeemed or Purchased in Part.
Any Security which is to be redeemed or purchased only in part shall
be surrendered to the Paying Agent at the office or agency maintained for such
purpose pursuant to Section 10.2 (with, if the Company, the Security Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company, the Security Registrar or the
Trustee, as the case may be, duly executed by the Holder thereof or such
Holder's attorney duly authorized in writing), and the Company shall execute,
and the Trustee shall authenticate and deliver to the Holder of such Security
without service charge, a new Security or Securities, of any authorized
denomination as requested by such Holder in aggregate principal amount equal
to, and in exchange for, the unredeemed portion of the principal of the
Security so surrendered that is not redeemed or purchased.
ARTICLE XII
SATISFACTION AND DISCHARGE
Section 12.1. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to
surviving rights of registration of transfer or exchange of the Securities
herein expressly provided for) and the Trustee, on demand of and at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when:
(a) either:
(1) all the Securities theretofore authenticated and
delivered (other than (i) lost, stolen or destroyed Securities which have been
replaced or paid as provided in Section 3.6 and (ii) Securities for whose
payment United States dollars have theretofore been deposited in trust by the
Company and thereafter repaid to the Company or discharged from such trust, as
provided in Section 10.3) have been delivered to the Trustee for cancellation;
or
(2) all Securities not theretofore delivered to the Trustee
for cancellation:
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year
under arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the Company,
and the Company has irrevocably deposited or caused to be
deposited with the Trustee as trust funds in trust an amount sufficient (as
confirmed in a written report of a nationally recognized firm of independent
public accountants or a nationally recognized investment banking firm) to pay
and discharge the entire indebtedness on the Securities not theretofore
delivered to the Trustee for cancellation, including principal of, premium, if
any, and accrued interest on such Securities at such Maturity, Stated Maturity
or Redemption Date;
(b) the Company has paid all other sums payable hereunder by the
Company; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each to the effect that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with and that such satisfaction and
discharge will not result in a breach or violation of, or constitute a default
under, this Indenture or any other material agreement to which the Company is
a party or by which the Company is bound.
Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 6.6 and, if United
States dollars shall have been deposited with the Trustee pursuant to
subclause (2) of Subsection (a) of this Section, the obligations of the
Trustee under Section 12.2 and the last paragraph of Section 10.3 shall
survive.
Section 12.2. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all
United States dollars deposited with the Trustee pursuant to Section 12.1
shall be held in trust and applied by it, in accordance with the provisions of
the Securities and this Indenture, to the payment, either directly or through
any Paying Agent as the Trustee may determine, to the Persons entitled
thereto, of the principal of, premium, if any, and interest on the Securities
for whose payment such United States dollars have been deposited with the
Trustee.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
HAYNES INTERNATIONAL, INC.
By: /s/ Michael D. Austin
------------------------
Name: Michael D. Austin
Title: President, CEO
Attest: /s/ Joseph F. Barker
-----------------------
Name: Joseph F. Barker
Title: V.P. - Finance
NATIONAL CITY BANK,
as Trustee
By: /s/ Faith Berning
-------------------
Name: Faith Berning
Title: Vice President
Attest: /s/ Karen Franklin
--------------------
Name: Karen Franklin
Title: Trust Officer
03382/096/INDEN/inden
2
STATE OF )
) ss.:
COUNTY OF )
On the day of August 1996, before me personally came
, to me known, who, being by me duly sworn, did depose and say that he resides
at ; that he is of Haynes International,
Inc., one of the corporations described in and which executed the foregoing
instrument; that he knows the corporate seal of such corporation; that the
seal affixed to said instrument is such corporate seal; that it was so affixed
pursuant to authority of the Board of Directors of such corporation; and that
he signed his name thereto pursuant to like authority.
(NOTARIAL SEAL)
STATE OF )
) ss.:
COUNTY OF )
On the day of August 1996, before me personally came
, to me known, who, being by me duly sworn, did depose and say that he resides
at ; that he is an authorized officer of National City Bank, one
of the corporations described in and which executed the foregoing instrument;
that he knows the corporate seal of such corporation; that the seal affixed to
said instrument is such corporate seal; that it was so affixed pursuant to
authority of the Board of Directors of such corporation; and that he signed
his name thereto pursuant to like authority.
(NOTARIAL SEAL)
SCHEDULE I
Restrictions on Dividends of Subsidiaries
---------------------------------------------