EXHIBIT 4.1
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Indenture
Dated as of April 15, 1997
among
TULTEX CORPORATION
as Issuer
AKOM, LTD.,
DOMINION STORES, INC.,
LOGOATHLETIC, INC.,
LOGOATHLETIC/HEADWEAR, INC.,
SWEATJET INCORPORATED,
TULTEX CANADA, INC. and
TULTEX INTERNATIONAL, INC.,
as Guarantors
and
FIRST UNION NATIONAL BANK OF VIRGINIA
as Trustee
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$75,000,000
9 5/8% Senior Notes due 2007
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CROSS-REFERENCE TABLE
Trust Indenture Indenture
Act Section Section
- --------------- ---------
(S)310(a)(1) .......................................................... 509
(a)(2) .......................................................... 509
(a)(3) .......................................................... Not Applicable
(a)(4) .......................................................... Not Applicable
(a)(5) .......................................................... Not Applicable
(b) ............................................................. 508, 510
(c) ............................................................. Not Applicable
(S)311(a) ............................................................. 513
(b) ............................................................. 513
(c) ............................................................. Not Applicable
(S)312(a) ............................................................. 601, 602(a)
(b) ............................................................. 602(b)
(c) ............................................................. 602(c)
(S)313(a) ............................................................. 603(a)
(b) ............................................................. 603(a)
(c) ............................................................. 603(a)
(d) ............................................................. 603(b)
(S)314(a) ............................................................. 604
(b) ............................................................. Not Applicable
(c)(1) .......................................................... 102
(c)(2) .......................................................... 102
(c)(3) .......................................................... Not Applicable
(d) ............................................................. Not Applicable
(e) ............................................................. 102
(S)315(a) ............................................................. 501
(b) ............................................................. 502
(c) ............................................................. 501
(d) ............................................................. 501
(d)(1) .......................................................... 501
(d)(2) .......................................................... 501
(d)(3) .......................................................... 501
(e) ............................................................. 414
(S)316(a) ............................................................. 101
(a)(1)(A) ....................................................... 412
(a)(1)(B) ....................................................... 413
(a)(2) .......................................................... Not Applicable
(b) ............................................................. 408
(S)317(a)(1) .......................................................... 403
(a)(2) .......................................................... 404
(b) ............................................................. 903
(S)318(a) ............................................................. 105
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Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE ONE
Definitions and Other Provisions of General Application
SECTION 101. Definitions...................................................................... 1
SECTION 102. Compliance Certificates and
Opinions......................................................................18
SECTION 103. Form of Documents Delivered to
Trustee.......................................................................19
SECTION 104. Notices..........................................................................19
SECTION 105. Conflict with Trust Indenture Act................................................20
SECTION 106. Effect of Headings and Table of
Contents......................................................................20
SECTION 107. Successors and Assigns...........................................................21
SECTION 108. Separability Clause..............................................................21
SECTION 109. Benefits of Indenture............................................................21
SECTION 110. Governing Law....................................................................21
SECTION 111. Legal Holidays...................................................................21
SECTION 112. Agent for Service; Submission to
Jurisdiction; Waiver of
Immunities....................................................................21
SECTION 113. No Recourse Against Others.......................................................22
SECTION 114. Rules by Trustee and Agents......................................................22
SECTION 115. No Adverse Interpretation of Other
Agreements....................................................................22
SECTION 116. Trustee as Paying Agent and
Security Registrar............................................................23
SECTION 117. Acceptance of Trust..............................................................23
ARTICLE TWO
The Securities
SECTION 201. Form and Dating..................................................................23
SECTION 202. Execution and Authentication.....................................................25
SECTION 203. Registrar and Paying Agent.......................................................26
SECTION 204. Paying Agent To Hold Money in
Trust.........................................................................26
SECTION 205. Securityholder Lists.............................................................26
SECTION 206. Transfer and Exchange............................................................27
SECTION 207. Replacement Securities...........................................................36
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Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
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Page
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SECTION 208. Temporary Securities.............................................................37
SECTION 209. Cancellation.....................................................................38
SECTION 210. Defaulted Interest...............................................................38
SECTION 211. CUSIP or CINS Number.............................................................39
SECTION 212. Payments of Interest.............................................................39
ARTICLE THREE
Satisfaction and Discharge
SECTION 301. Satisfaction and Discharge of
Indenture.....................................................................40
SECTION 302. Application of Trust Money.......................................................41
ARTICLE FOUR
Remedies
SECTION 401. Events of Default................................................................42
SECTION 402. Acceleration of Maturity;
Rescission and Annulment......................................................44
SECTION 403. Collection of Indebtedness and
Suits for Enforcement by
Trustee.......................................................................45
SECTION 404. Trustee May File Proofs of Claim.................................................46
SECTION 405. Trustee May Enforce Claims Without
Possession of Securities......................................................46
SECTION 406. Application of Money Collected...................................................47
SECTION 407. Limitation on Suits..............................................................47
SECTION 408. Unconditional Right of Holders To
Receive Principal, Premium and
Interest......................................................................48
SECTION 409. Restoration of Rights and Remedies...............................................48
SECTION 410. Rights and Remedies Cumulative...................................................48
SECTION 411. Delay or Omission Not Waiver.....................................................49
SECTION 412. Control by Holders...............................................................49
SECTION 413. Waiver of Past Defaults..........................................................49
SECTION 414. Undertaking for Costs............................................................50
SECTION 415. Waiver of Stay or Extension Laws.................................................50
ARTICLE FIVE
The Trustee
SECTION 501. Certain Duties and
Responsibilities..............................................................51
SECTION 502. Notice of Default................................................................51
SECTION 503. Certain Rights of Trustee........................................................51
SECTION 504. Not Responsible for Issuance of
Securities....................................................................52
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SECTION 505. May Hold Securities..............................................................53
SECTION 506. Money Held in Trust..............................................................53
SECTION 507. Compensation and Reimbursement...................................................53
SECTION 508. Disqualification; Conflicting
Interests.....................................................................54
SECTION 509. Corporate Trustee Required;
Eligibility...................................................................54
SECTION 510. Resignation and Removal;
Appointment of Successor......................................................54
SECTION 511. Acceptance of Appointment by
Successor.....................................................................55
SECTION 512. Merger, Conversion, Consolidation
or Succession to Business.....................................................56
SECTION 513. Preferential Collection of Claims
Against the Company and Any
Guarantor.....................................................................56
ARTICLE SIX
Holders' Lists and Reports by Trustee and the Company
SECTION 601. Company To Furnish Trustee Names
and Addresses of Holders......................................................57
SECTION 602. Preservation of Information;
Communication to Holders......................................................57
SECTION 603. Reports by Trustee...............................................................58
SECTION 604. Reports by Company...............................................................58
ARTICLE SEVEN
Consolidation and Merger
SECTION 701. Mergers, Consolidations and Certain
Sales of Assets...............................................................58
SECTION 702. Successor Substituted............................................................60
ARTICLE EIGHT
Supplemental Indentures
SECTION 801. Supplemental Indentures Without
Consent of Holders............................................................60
SECTION 802. Supplemental Indentures with
Consent of Holders............................................................61
SECTION 803. Execution of Supplemental
Indentures....................................................................62
SECTION 804. Effect of Supplemental Indentures................................................62
SECTION 805. Conformity with Trust Indenture
Act...........................................................................63
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Page
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SECTION 806. Reference in Securities to
Supplemental Indentures.....................................63
SECTION 807. Revocation and Effect of Consents..............................63
ARTICLE NINE
Covenants
SECTION 901. Payment of Principal, Premium and
Interest....................................................64
SECTION 902. Maintenance of Office or Agency................................64
SECTION 903. Money for Security Payments To Be
Held in Trust...............................................65
SECTION 904. Existence......................................................66
SECTION 905. Maintenance of Properties......................................67
SECTION 906. Payment of Taxes and Other Claims..............................67
SECTION 907. Maintenance of Insurance.......................................67
SECTION 908. Limitation on Indebtedness.....................................68
SECTION 909. Additional Limitation on Subsidiary
Indebtedness................................................70
SECTION 910. Limitation on Restricted Payments..............................70
SECTION 911. Limitations Concerning
Distributions and Transfers by
Subsidiaries................................................73
SECTION 912. Limitation on Liens............................................73
SECTION 913. Limitation on Sale and Leaseback
Transactions................................................75
SECTION 914. Limitation on Issuance and Sale of
Capital Stock of Subsidiaries...............................75
SECTION 915. Transactions with Affiliates and
Related Persons.............................................75
SECTION 916. Limitation on Certain Asset
Dispositions................................................76
SECTION 917. Change of Control..............................................78
SECTION 918. Provision of Financial Information.............................78
SECTION 919. Statement by Officers as to
Default; Compliance
Certificates................................................80
SECTION 920. Special Covenants of the
Guarantors..................................................80
ARTICLE TEN
Redemption of Securities
SECTION 1001. Right of Redemption............................................81
SECTION 1002. Applicability of Article.......................................81
SECTION 1003. Election To Redeem; Notice to
Trustee.....................................................81
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Page
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SECTION 1004. Selection by Trustee of Securities
To Be Redeemed..............................................81
SECTION 1005. Notice of Redemption...........................................82
SECTION 1006. Deposit of Redemption Price....................................82
SECTION 1007. Securities Payable on Redemption
Date........................................................83
SECTION 1008. Securities Redeemed in Part....................................83
ARTICLE ELEVEN
Guarantee
SECTION 1101. Unconditional Guarantee........................................83
SECTION 1102. Severability...................................................84
SECTION 1103. Release of a Guarantor.........................................84
SECTION 1104. Limitation of Guarantor's
Liability...................................................85
SECTION 1105. Contribution...................................................85
SECTION 1106. Execution of Guarantee.........................................86
SECTION 1107. Additional Guarantors..........................................86
SECTION 1108. Subordination of Subrogation and
Other Rights................................................87
ARTICLE TWELVE
Defeasance and Covenant Defeasance
SECTION 1201. Defeasance and Covenant Defeasance.............................87
SECTION 1202. Application of Trust Money.....................................90
SECTION 1203. Reinstatement..................................................90
SIGNATURES
EXHIBIT A - Form of Security................................................ A-1
EXHIBIT B - Form of Certificate of Transfer................................. B-1
EXHIBIT C - Form of Certificate of Exchange................................. C-1
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INDENTURE, dated as of April 15, 1997, among TULTEX CORPORATION, a
Virginia corporation, AKOM, LTD., a Cayman Islands, British West Indies
corporation, DOMINION STORES, INC., a Virginia corporation, LOGOATHLETIC, INC.,
a Virginia corporation, LOGOATHLETIC/HEADWEAR, INC., a Massachusetts
corporation, SWEATJET INCORPORATED, a Virginia corporation, TULTEX CANADA, INC.,
a Canadian corporation, TULTEX INTERNATIONAL, INC., a Virginia corporation, and
FIRST UNION NATIONAL BANK OF VIRGINIA, as trustee.
Each party hereto agrees as follows for the benefit of each other
party and for the equal and ratable benefit of the Holders of the Company's
9 5/8% Senior Notes due 2007:
ARTICLE ONE
Definitions and Other Provisions
of General Application
SECTION 101. Definitions.
-----------
For purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include plural as well as the singular;
(2) 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;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(4) all references to dollars or "$" are to U.S. dollars;
(5) 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
(6) provisions apply to successive events and transactions.
"Additional Interest" shall have the meaning set forth in the
Registration Rights Agreement.
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"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or co-Registrar. See Section
203.
"Applicable Procedures" means with respect to any transfer or exchange
of interests in a Global Security, the rules and procedures of DTC, Euroclear or
Cedel that apply to such transfer or exchange.
"Asset Disposition" means any sale, transfer or other disposition of
(i) shares of Capital Stock of a Subsidiary of the Company (other than
directors' qualifying shares) or (ii) property or assets of the Company or any
Subsidiary of the Company; provided, however, that an Asset Disposition shall
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not include (a) any sale, transfer or other disposition of shares of Capital
Stock, property or assets by a Subsidiary of the Company to the Company or to
another Subsidiary of the Company, (b) any sale, transfer or other disposition
of defaulted receivables for collection or any sale, transfer or other
disposition of property or assets in the ordinary course of business or (c) any
isolated sale, transfer or other disposition that does not involve aggregate
consideration in excess of $250,000 individually.
"Average Life" means, as of the date of determination, with respect
to any Indebtedness for borrowed money or Preferred Stock, the quotient obtained
by dividing (i) the sum of the products of the number of years from the date of
determination to the dates of each successive scheduled principal or
liquidation value payments of such Indebtedness or Preferred Stock,
respectively, and the amount of such principal or liquidation value payments,
by (ii) the sum of all such principal or liquidation value payments.
"Board of Directors" of any Person means either the board of directors
of such Person or any duly authorized committee of that board.
"Board Resolution" of any Person means a copy of a resolution
certified by the Secretary or an Assistant Secretary of such Person to have been
duly adopted by the Board of Directors of such Person and to be in full force
and effect on the date of such certification, and delivered to the Trustee.
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"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, New York or the Commonwealth of Virginia are authorized or obligated by
law or executive order to close.
"Capital Lease Obligations" of any Person means the obligations to pay
rent or other amounts under a lease of (or other Indebtedness arrangements
conveying the right to use) real or personal property of such Person which are
required to be classified and accounted for as a capital lease or liability on
the face of a balance sheet of such Person in accordance with GAAP. The amount
of such obligations shall be the capitalized amount thereof in accordance with
GAAP and the stated maturity thereof shall be the date of the last payment of
rent or any other amount due under such lease prior to the first date upon which
such lease may be terminated by the lessee without payment of a penalty.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock of
such Person (including any Preferred Stock outstanding on the Issue Date).
"Cedel" means Cedel Bank, societe anonyme.
"Change of Control" has the meaning specified in Section 917.
"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 instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Stock" of any Person means Capital Stock of such Person that
does not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
"Company" means Tultex Corporation, a Virginia corporation, and any
successor thereof.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its President or
a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or
an Assistant Secretary, and delivered to the Trustee.
-4-
"Consolidated Cash Flow Available for Fixed Charges" of any Person
means for any period the Consolidated Net Income of such Person for such period
increased by the sum of (i) Consolidated Interest Expense of such Person for
such period, plus (ii) Consolidated Income Tax Expense of such Person for such
period, plus (iii) the consolidated depreciation and amortization expense
included in the income statement of such Person for such period, plus (iv) other
non-cash charges of such Person for such period deducted from consolidated
revenues in determining Consolidated Net Income for such period, minus (v) non-
cash items (including the partial or entire reversal of reserves taken in prior
periods) of such Person for such period increasing consolidated revenues in
determining Consolidated Net Income for such period.
"Consolidated Cash Flow Ratio" of any Person means for any period the
ratio of (i) Consolidated Cash Flow Available for Fixed Charges of such Person
for such period to (ii) the sum of (A) Consolidated Interest Expense of such
Person for such period, plus (B) the annual interest expense with respect to any
Indebtedness proposed to be Incurred by such Person or its Subsidiaries, minus
(C) Consolidated Interest Expense of such Person to the extent included in
clause (ii)(A) with respect to any Indebtedness that will no longer be out-
standing as a result of the Incurrence of the Indebtedness proposed to be
Incurred, plus (D) the annual interest expense with respect to any other
Indebtedness Incurred by such Person or its Subsidiaries since the end of such
period to the extent not included in clause (ii)(A), minus (E) Consolidated
Interest Expense of such Person to the extent included in clause (ii)(A) with
respect to any Indebtedness that no longer is outstanding as a result of the
Incurrence of the Indebtedness referred to in clause (ii)(D); provided, however,
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that in making such computation, the Consolidated Interest Expense of such
Person attributable to interest on any Indebtedness bearing a floating interest
rate shall be computed on a pro forma basis as if the rate in effect on the date
of computation (after giving effect to any hedge in respect of such Indebtedness
that will, by its terms, remain in effect until the earlier of the maturity of
such Indebtedness or the date one year after the date of such determination) had
been the applicable rate for the entire period; provided further that, in the
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event such Person or its Subsidiaries has made Asset Dispositions or
acquisitions of assets not in the ordinary course of business (including
acquisitions of other Persons by merger, consolidation or purchase of Capital
Stock) during or after such period, such computation shall be made on a pro
forma basis as if the Asset Dispositions or acquisitions had taken place on the
first day of such period. Calculations of pro forma amounts in accordance with
this definition shall be done in accordance with Rule 11-02 of Regulation S-X
under the Securities Act or any successor provision.
-5-
"Consolidated Income Tax Expense" of any Person means for any period
the consolidated provision for income taxes of such Person for such period
calculated on a consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" for any Person means for any period
the consolidated interest expense included in a consolidated income statement
(without deduction of interest income) of such Person for such period calculated
on a consolidated basis in accordance with GAAP, plus cash dividends declared
on any Preferred Stock (other than any Preferred Stock of the Company
outstanding on the Issue Date). For purposes of this definition, the amount of
any cash dividends declared will be deemed to be equal to the amount of such
dividends multiplied by a fraction, the numerator of which is one and the de-
nominator of which is one minus the maximum statutory combined Federal, state,
local and foreign income tax rate then applicable to such Person and its
Subsidiaries (expressed as a decimal between one and zero), on a consolidated
basis.
"Consolidated Net Income" of any Person means for any period the
consolidated net income (or loss) of such Person for such period determined on a
consolidated basis in accordance with GAAP; provided that there shall be
--------
excluded therefrom (a) the net income (or loss) of any Person acquired by such
Person or a Subsidiary of such Person in a pooling-of-interests transaction for
any period prior to the date of such transaction, (b) the net income (but not
net loss) of any Subsidiary of such Person which is subject to restrictions
which prevent or limit the payment of dividends or the making of distributions
to such Person to the extent of such restrictions, (c) the net income of any
Person that is not a Subsidiary of such Person except to the extent of the
amount of dividends or other distributions actually paid in cash to such Person
by such other Person during such period, (d) gains or losses on Asset
Dispositions by such Person or its Subsidiaries and (e) all extraordinary gains
and extraordinary losses determined in accordance with GAAP.
"Consolidated Net Tangible Assets" means, at any date, the
consolidated book value as shown by the accounting books and records of the
Company and its Subsidiaries of all their property, both real and personal, less
(i) the book value of all their licenses, patents, patent applications, copy-
rights, trademarks, trade names, goodwill, non-compete agreements or
organizational expenses and other intangibles, (ii) unamortized Indebtedness
discount and expenses, (iii) all reserves for depreciation, obsolescence,
depletion and amortization of their properties and (iv) all other proper
reserves which in accordance with GAAP should be provided in connection with the
business conducted by the Company and its Subsidiaries.
-6-
"Consolidated Net Worth" of any Person means the consolidated
stockholders' equity of such Person, determined on a consolidated basis in
accordance with GAAP, less (without duplication) amounts attributable to
Disqualified Stock of such Person.
"Continuing Director" means a director who either was a member of the
Board of Directors of the Company on the Issue Date or who became a director of
the Company subsequent to the Issue Date and whose election, or nomination for
election by the Company's stockholders, was duly approved by a majority of the
Continuing Directors then on the Board of Directors of the Company, either by a
specific vote or by approval of the proxy statement issued by the Company on
behalf of the entire Board of Directors of the Company in which such individual
is named as nominee for director.
"Corporate Trust Office" means the principal office of the Trustee in
Richmond, Virginia at which at any particular time its corporate trust business
shall be administered.
"corporation" means a corporation, association, company, joint-stock
company, partnership or business trust.
"Default" means any event that is, or after notice or lapse of time or
both would become, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 210.
"Disqualified Stock" of any Person means any Capital Stock of such
Person which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to the final Stated Maturity of the Securities;
provided that any Preferred Stock of the Company outstanding on the Issue Date
shall not be deemed Disqualified Stock.
"DTC" means The Depository Trust Company or its successors.
"Eligible Accounts Receivable" means the face value of all "eligible
receivables" of the Company and its Subsidiaries party to any credit agreement
constituting the Senior Credit Facility (as such term is defined for purposes of
such credit agreement).
"Eligible Inventory" means the face value of all "eligible inventory"
of the Company and its Subsidiaries party
-7-
to any credit agreement constituting the Senior Credit Facility (as such term is
defined for purposes of such credit agreement).
"Euroclear" means Morgan Guaranty Trust Company of New York (Brussels
Office) as operator of the Euroclear system.
"Event of Default" has the meaning specified in Section 401.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Registration Statement" shall have the meaning set forth in
the Registration Rights Agreement.
"Expiration Date" has the meaning specified in the definition of
"Offer to Purchase".
"GAAP" means generally accepted accounting principles, consistently
applied, as in effect on the Issue Date in the United States of America, as set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as is approved by a significant segment of the
accounting profession.
"Global Security" means the global security, without coupons,
representing all or a portion of the Securities deposited with DTC
substantially in the form of Exhibit A attached hereto.
"guarantee" by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing any Indebtedness of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such Person (i) to purchase or
pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or to purchase (or to advance or supply funds for the purchase of)
any security for the payment of such Indebtedness, (ii) to purchase property,
securities or services for the purpose of assuring the holder of such
Indebtedness of the payment of such Indebtedness, or (iii) to maintain working
capital, equity capital or other financial statement condition or the liquidity
of the primary obligor so as to enable the primary obligor to pay such
Indebtedness (and "guaranteed", "guaranteeing" and "guarantor" shall have
meanings correlative to the foregoing); provided, however, that the guarantee by
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any Person shall not include endorsements by such Person for collection or
deposit, in either case, in the ordinary course of business.
-8-
"Guarantee" means (i) the guarantee of each Guarantor set
forth in the Securities and Article Eleven and (ii) any additional guarantee of
the Securities executed by any Material Subsidiary.
"Guarantors" means (i) each of AKOM, Ltd., Dominion Stores,
Inc., LogoAthletic, Inc., LogoAthletic/Headwear Inc., SweatJet Incorporated,
Tultex Canada, Inc., and Tultex International, Inc. and (ii) each Material
Subsidiary formed or acquired after the Issue Date that becomes a Guarantor of
the Securities pursuant to Section 1107.
"Holder" or "Securityholder" means a Person in whose name a
Security is registered in the Security Register.
"Incur" means, with respect to any Indebtedness or other
obligation of any Person, to create, issue, incur (including by conversion,
exchange or otherwise), assume, guarantee or otherwise become liable in respect
of such Indebtedness or other obligation or the recording, as required pursuant
to GAAP or otherwise, of any such Indebtedness or other obligation on the
balance sheet of such Person (and "Incurrence", "Incurred", "Incurrable" and
"Incurring" shall have meanings correlative to the foregoing). Indebtedness of
any Person or any of its Subsidiaries existing at the time such Person becomes
a Subsidiary of the Company (or is merged into or consolidates with the Company
or any of its Subsidiaries), whether or not such Indebtedness was incurred in
connection with, or in contemplation of, such Person becoming a Subsidiary of
the Company (or being merged into or consolidated with the Company or any of
its Subsidiaries), shall be deemed Incurred at the time any such Person becomes
a Subsidiary of the Company or merges into or consolidates with the Company or
any of its Subsidiaries.
"Indebtedness" means (without duplication), with respect to
any Person, whether recourse is to all or a portion of the assets of such Person
and whether or not contingent, (i) every obligation of such Person for money
borrowed, (ii) every obligation of such Person evidenced by bonds, debentures,
notes or other similar instruments, including obligations Incurred in
connection with the acquisition of property, assets or businesses, (iii) every
reimbursement obligation of such Person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
Person, (iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business which are not
overdue or which are being contested in good faith), (v) every Capital Lease
Obligation of such Person, (vi) every net obligation under interest rate swap
or similar agreements or foreign cur-
-9-
rency hedge, exchange or similar agreements of such Person, and (vii) every
obligation of the type referred to in clauses (i) through (vi) of another Person
and all dividends of another Person the payment of which, in either case, such
Person has guaranteed or for which such Person is responsible or liable,
directly or indirectly, as obligor, guarantor or otherwise. Indebtedness shall
include the liquidation preference and any mandatory redemption payment
obligations in respect of any Disqualified Stock of the Company and any
Preferred Stock of a Subsidiary of the Company. Indebtedness shall never be
calculated taking into account any cash and cash equivalents held by such
Person.
"Indenture" means this instrument as originally executed or
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.
"Initial Global Securities" means the Regulation S Global
Security and the 144A Global Security, each of which contains a Securities Act
Legend.
"Initial Securities" means the Securities containing
a Securities Act Legend.
"Institutional Accredited Investors" means an institution
that is an "accredited investor" as that term is defined in Rule 501(a)(1), (2),
(3) or (7) of Regulation D promulgated under the Securities Act.
"Interest Payment Date" means the Stated Maturity of
an installment of interest on the Securities.
"Investment" by any Person means any direct or indirect loan,
advance or other extension of credit or capital contribution to (by means of
transfers of cash or other property to others or payments for property or
services for the account or use of others, or otherwise), or purchase or
acquisition of Capital Stock, bonds, notes, debentures or other securities or
evidence of Indebtedness issued by any other Person.
"Issue Date" means the original issue date of the Securities.
"Lien" means, with respect to any property or assets, any
mortgage or deed of trust, pledge, hypothecation, assignment, security
interest, lien, charge, easement (other than any easement not materially
impairing usefulness or marketability), encumbrance, preference, priority or
other security agreement with respect to such property or assets (including,
without limitation, any conditional sale or other title retention
-10-
agreement having substantially the same economic effect as any of the
foregoing).
"Material Subsidiary" means any Subsidiary of the Company
which would constitute a "significant subsidiary" of the Company as defined in
Rule 1-02 of Regulation S-X promulgated by the Commission except that for
purposes of this definition all references therein to ten (10) percent shall be
deemed to be references to five (5) percent.
"Maturity", when used with respect to any Security, means the
date on which the principal of such Security becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"Net Available Proceeds" from any Asset Disposition by any
Person means cash or readily marketable cash equivalents received (including by
way of sale or discounting of a note, installment receivable or other
receivable, but excluding any other consideration received in the form of
assumption by the acquiree of Indebtedness or other obligations relating to such
properties or assets or received in any other noncash form) therefrom by such
Person, net of (i) all legal, title and recording tax expenses, commissions and
other fees and expenses Incurred and all federal, state, foreign and local taxes
required to be accrued as a liability as a consequence of such Asset
Disposition, (ii) all payments made by such Person or its Subsidiaries on any
Indebtedness which is secured by such assets in accordance with the terms of
any Lien upon or with respect to such assets or which must by the terms of such
Lien, or in order to obtain a necessary consent to such Asset Disposition or by
applicable law, be repaid out of the proceeds from such Asset Disposition, (iii)
all payments made with respect to liabilities associated with the assets which
are the subject of the Asset Disposition, including, without limitation, trade
payables and other accrued liabilities, (iv) appropriate amounts to be provided
by such Person or any Subsidiary thereof, as the case may be, as a reserve in
accordance with GAAP against any liabilities associated with such assets and
retained by such Person or any Subsidiary thereof, as the case may be, after
such Asset Disposition, including, without limitation, liabilities under any
indemnification obligations and severance and other employee termination costs
associated with such Asset Disposition, until such time as such amounts are no
longer reserved or such reserve is no longer necessary (at which time any
remaining amounts will become Net Available Proceeds to be allocated in
accordance with the provisions of clause (iii) of Section 916(a)), and (v) all
distributions and other payments made to minority interest holders in Subsidiar-
ies of such Person or joint ventures as a result of such Asset Disposition.
-11-
"1995 Notes" means the Senior Notes issued under the Indenture
dated as of March 15, 1995 among the Company, the guarantors named therein and
First Union National Bank of Virginia, as trustee.
"Offer" has the meaning specified in the definition
of Offer to Purchase.
"Offer to Purchase" means a written offer (the "Offer") sent
by the Company by first class mail, postage prepaid, to each Holder at his
address appearing in the Security Register on the date of the Offer offering to
purchase up to the principal amount of Securities specified in such Offer at the
purchase price specified in such Offer (as determined pursuant to this
Indenture). Unless otherwise required by applicable law, the Offer shall specify
an expiration date (the "Expiration Date") of the Offer to Purchase which shall
be not less than 30 days or more than 60 days after the date of such Offer and a
settlement date (the "Purchase Date") for purchase of Securities within five
Business Days after the Expiration Date. The Company shall notify the Trustee at
least 15 Business Days (or such shorter period as is acceptable to the Trustee)
prior to the mailing of the Offer of the Company's obligation to make an Offer
to Purchase, and the Offer shall be mailed by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company. The Offer
shall contain all information required by applicable law to be included therein.
The Offer shall contain all instructions and materials necessary to enable such
Holders to tender Securities pursuant to the Offer to Purchase. The Offer shall
also state:
(1) the Section of this Indenture pursuant to which the Offer
to Purchase is being made;
(2) the Expiration Date and the Purchase Date;
(3) the aggregate principal amount of outstanding Securities
offered to be purchased by the Company pursuant to the Offer to
Purchase (including, if less than 100%, the manner by which such has
been determined pursuant to the Section hereof requiring the Offer to
Purchase) (the "Purchase Amount");
(4) the purchase price to be paid by the Company for each
$1,000 aggregate principal amount of Securities accepted for payment
(as specified pursuant to this Indenture) (the "Purchase Price");
(5) that the Holder may tender all or any portion of the
Securities registered in the name of such Holder and
-12-
that any portion of a Security tendered must be tendered in an integral
multiple of $1,000 principal amount;
(6) the place or places where Securities are to be
surrendered for tender pursuant to the Offer to Purchase;
(7) that interest on any Security not tendered or
tendered but not purchased by the Company pursuant to the Offer to
Purchase will continue to accrue;
(8) that on the Purchase Date the Purchase Price will become
due and payable upon each Security being accepted for payment pursuant
to the Offer to Purchase and that interest thereon shall cease to
accrue on and after the Purchase Date;
(9) that each Holder electing to tender a Security pursuant to
the Offer to Purchase will be required to surrender such Security at
the place or places specified in the Offer prior to the close of
business on the Expiration Date (such Security being, if the Company or
the Trustee so requires, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or his attorney duly
authorized in writing);
(10) that Holders will be entitled to withdraw all or any
portion of Securities tendered if the Company (or its Paying Agent)
receives, not later than the close of business on the fifth Business
Day next preceding the Expiration Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Security the Holder tendered, the certificate
number of the Security the Holder tendered and a statement that such
Holder is withdrawing all or a portion of his tender;
(11) that (a) if Securities in an aggregate principal amount
less than or equal to the Purchase Amount are duly tendered and not
withdrawn pursuant to the Offer to Purchase, the Company shall
purchase all such Securities and (b) if Securities in an aggregate
principal amount in excess of the Purchase Amount are tendered and not
withdrawn pursuant to the Offer to Purchase, the Company shall pur-
chase Securities having an aggregate principal amount equal to the
Purchase Amount on a pro rata basis (with such adjustments as may be
deemed appropriate so that only Securities in denominations of $1,000
or integral multiples thereof shall be purchased) among tendering
Holders; and
-13-
(12) that in the case of any Holder whose Security is
purchased only in part, the Company shall execute, the Guarantors shall
execute the Guarantee endorsed thereon and the Trustee shall
authenticate and deliver to the Holder of such Security without service
charge, a new Security or Securities of any authorized denomination as
requested by such Holder, in an aggregate principal amount equal to
and in exchange for the unpurchased portion of the Security so
tendered.
Any Offer to Purchase shall be governed by and effected in
accordance with the Offer for such Offer to Purchase.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the President or a Vice President, and by the Treasurer,
an Assistant Treasurer, the 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, 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:
(i) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities with respect to which the Company has effected
defeasance and/or covenant defeasance as provided in Article Twelve,
except to the extent provided in Article Twelve;
(iii) Securities in lieu of which other Securities have been
authenticated and delivered pursuant to Section 207, other than any
such Securities in respect of which there shall have been presented to
the Trustee proof satisfactory to it that such Securities are held by
a bona fide purchaser in whose hands such 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, any Guarantor or any other obligor upon the Securities or any
Affiliate of the Company, any Guarantor or of 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,
-14-
direction, notice, consent or waiver, only Securities which the Trustee knows to
be so owned shall be so disregarded.
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company.
"Permitted Investments" means (i) Investments in marketable
direct obligations issued or guaranteed by the United States of America, or any
governmental entity or agency or political subdivision thereof (provided that
the full faith and credit of the United States of America is pledged in support
thereof), maturing within one year of the date of purchase; (ii) Investments in
commercial paper issued by corporations, each of which shall have a consolidated
net worth of at least $500,000,000, maturing within 180 days from the date of
the original issue thereof, and rated "P-1" or better by Moody's Investors
Service or "A-1" or better by Standard & Poor's Corporation or an equivalent
rating or better by any other nationally recognized securities rating agency;
(iii) Investments in certificates of deposit issued or acceptances accepted by
or guaranteed by any bank or trust company organized under the laws of the
United States of America or any state thereof or the District of Columbia, in
each case having capital, surplus and undivided profits totaling more than
$500,000,000, maturing within one year of the date of purchase; (iv) Investments
representing Capital Stock or obligations issued to the Company or any of its
Subsidiaries in the course of the good faith settlement of claims against any
other Person or by reason of a composition or readjustment of debt or a
reorganization of any debtor of the Company or any of its Subsidiaries; (v)
deposits, including interest-bearing deposits, maintained in the ordinary course
of business in banks; and (vi) any acquisition of the Capital Stock of any
Person provided that after giving effect to any such acquisition such Person
shall become a Subsidiary of the Company.
"Person" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Preferred Stock", as applied to the Capital Stock of any
Person, means Capital Stock of such Person of any class or classes (however
designated) that ranks prior, as to the payment of dividends or as to the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person, to shares of Capital Stock of any
other class of such Person.
"Private Exchange Securities" shall have the meaning set forth
in the Registration Rights Agreement.
-15-
"Purchase Amount" has the meaning specified in the definition
of Offer to Purchase.
"Purchase Date" has the meaning specified in the definition of
Offer to Purchase.
"Purchase Price" has the meaning specified in the definition
of Offer to Purchase.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture and such Security.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture and such Security.
"Registration Rights Agreement" means the Registration Rights
Agreement dated the date hereof among the Company, the Guarantors, J.P. Morgan
Securities Inc. and NationsBanc Capital Markets Inc.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the April 1 or October 1 (whether or not a Business Day), as
the case may be, next preceding such Interest Payment Date.
"Regulation S" means Regulation S promulgated under the
Securities Act (including any successor regulation thereto) as it may be amended
from time to time.
"Related Person" of any Person means any other Person directly
or indirectly owning (a) 5% or more of the outstanding Common Stock of such
Person (or, in the case of a Person that is not a corporation, 5% or more of the
equity interest in such Person) or (b) 5% or more of the combined voting power
of the Voting Stock of such Person.
"Required Filing Dates" has the meaning specified in
Section 918.
"Responsible Officer", when used with respect to the Trustee,
means any officer of the Trustee including without limitation any vice
president, any assistant vice president, any trust officer, any assistant
secretary or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer
to whom such matter is referred because
-16-
of his knowledge of and familiarity with the particular subject.
"Restricted Payments" has the meaning specified in Section
910.
"Restricted Physical Security" means a Physical Security
containing a Securities Act Legend.
"Rule 144" shall have the meaning set forth in the
Registration Rights Agreement.
"Rule 144A" shall have the meaning set forth in the
Registration Rights Agreement.
"Sale and Leaseback Transaction" of any Person means an
arrangement with any lender or investor or to which such lender or investor is a
party providing for the leasing by such Person of any property or asset of such
Person which has been or is being sold or transferred by such Person more than
270 days after the acquisition thereof or the completion of construction or
commencement of operation thereof to such lender or investor or to any Person to
whom funds have been or are to be advanced by such lender or investor on the
security of such property or asset. The stated maturity of such arrangement
shall be the date of the last payment of rent or any other amount due under such
arrangement prior to the first date on which such arrangement may be terminated
by the lessee without payment of a penalty.
"Securities" means the Company's 9 5/8% Senior Notes due 2007
issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Facility" means the Credit Agreement, dated as
of March 8, 1995, among the Company as borrower thereunder, any Subsidiaries of
the Company as guarantors thereunder and NationsBank, N.A., as agent on behalf
of itself and the other lenders named therein, including any deferrals,
renewals, extensions, replacements, refinancings or refundings thereof, or
amendments, modifications or supplements thereto and any agreement providing
therefor whether by or with the same or any other lenders, creditors, group of
lenders or group of creditors.
"Shelf Registration Statement" shall have the meaning set
forth in the Registration Rights Agreement.
-17-
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 210.
"Stated Maturity", when used with respect to any Security or
any installment of interest thereon, means the date specified in such Security
as the fixed date on which the principal of such Security or such installment
of interest is due and payable, respectively.
"Subsidiary" of any Person means (i) a corporation more than
50% of the outstanding Voting Stock of which is owned, directly or indirectly,
by such Person or by one or more other Subsidiaries of such Person or by such
Person and one or more Subsidiaries thereof or (ii) any other Person (other than
a corporation) in which such Person, or one or more other Subsidiaries of such
Person or such Person and one or more other Subsidiaries thereof, directly or
indirectly, has at least a majority ownership and voting power relating to the
policies, management and affairs thereof.
"Surviving Entity" has the meaning set forth in Section 701.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
"Trustee" means the Person named as such in this Indenture
until a successor Trustee shall have become such pursuant to the applicable
provisions of this Indenture, and there after "Trustee" shall mean such
successor Trustee.
"United States Government Obligations" means direct
obligations of the United States for the payment of which the full faith and
credit of the United States is pledged.
"Unrestricted Global Securities" means one or more Global
Securities that do not and are not required to bear the Securities Act Legend.
"Unrestricted Physical Securities" means one or more Physical
Securities that do not and are not required to bear the Securities Act Legend.
"Unrestricted Securities" means the Securities that do not and
are not required to bear the Securities Act Legend.
"Vice President", when used with respect to the Company or
the Trustee, means any vice president, whether or not designated by a number or
a word or words added before or after the title "vice president".
-18-
"Voting Stock" of any Person means the Capital Stock of such
Person which ordinarily has voting power for the election of directors (or
persons performing similar functions) of such Person, whether at all times or
only so long as no senior class of securities has such voting power by reason of
any contingency.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of
such Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person or by
such Person and one or more Wholly Owned Subsidiaries of such Person.
SECTION 102. 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 shall
furnish to the Trustee such certificates and opinions as may be required under
the Trust Indenture Act. Each such certificate or opinion shall be given in the
form of an Officers' Certificate, if to be given by an officer of the Company,
or an Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.
Every certificate or opinion with respect to compliance with
a condition or covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
-19-
SECTION 103. 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 of an officer of the Company may be based,
insofar as it relates to legal matters, upon an opinion of counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the
opinion with respect to the matters upon which his certificate is based is
erroneous. Any such opinion of counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company stating the information with respect to such
factual matters, unless such counsel knows, or in the exercise of reasonable
care should know, that the certificate or opinion or representations with
respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 104. Notices.
-------
(a) Any notice or communication by the Company or any Guarantor or by
the Trustee to any party hereto shall be duly given if in writing and delivered
in person or mailed by first class mail (registered or certified, return receipt
requested), facsimile or overnight air courier guaranteeing next day delivery,
to such other party's address.
If to the Company or to any Guarantor:
Tultex Corporation
101 Commonwealth Boulevard
Martinsville, Virginia 24112
Facsimile No.: (540) 634-2611
Attention: Suzanne Wood, Chief Financial
Officer
-20-
If to the Trustee:
First Union National Bank Of Virginia,
901 East Cary Street
Richmond, Virginia 23219
Facsimile No.: (804) 788-9661
Attention: Corporate Trust Department
(b) The Company, any Guarantor or the Trustee, by notice to
the other parties hereto, may designate additional or different addresses for
subsequent notices or communications.
(c) All notices and communications will be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, if mailed; when receipt
acknowledged, if sent by facsimile; and the next Business Day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next day
delivery.
(d) Any notice or communication to a Holder will be mailed by
first-class, postage-prepaid mail, return receipt requested, to the Holder's
address shown on the Security Register. Failure to mail a notice or
communication to a Holder or any defect in it will not affect its sufficiency
with respect to other Holders.
(e) If a notice or communication is mailed in the manner
provided above within the time prescribed, it is duly given, whether or not the
addressee receives it.
(f) If the Company mails a notice or communication to Holders,
it will mail a copy to the Trustee at the same time.
SECTION 105. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required thereunder to be part of
and govern this Indenture, the latter provision 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, the latter provision shall be deemed
to apply to this Indenture as so modified or to be excluded, as the case may be.
SECTION 106. 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.
-21-
SECTION 107. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company
or any Guarantor shall bind its respective successors and assigns, whether so
expressed or not.
SECTION 108. Separability Clause.
-------------------
In case any provision in this Indenture or in the Securities
or Guarantees 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 109. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Securities or Guarantees,
express or implied, shall give to any Person, other than the parties hereto and
their successors hereunder and the Holders of Securities, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
SECTION 110. Governing Law.
-------------
This Indenture, the Securities and the Guarantees endorsed
thereon shall be governed by and construed in accordance with the laws of the
State of New York without regard to principles of conflicts of law.
SECTION 111. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date,
Purchase Date 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 (and premium, if any) need not be
made on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the Interest Payment Date, Redemption Date
or Purchase Date, or at the Stated Maturity, as the case may be, provided that
--------
no interest shall accrue for the period from and after such Interest Payment
Date, Redemption Date or Purchase Date or Stated Maturity, as the case may be.
SECTION 112. Agent for Service; Submission to Jurisdiction; Waiver of
--------------------------------------------------------
Immunities.
----------
By the execution and delivery of this Indenture, each
Guarantor (i) hereby irrevocably designates and appoints the Company as its
authorized agent upon which process may be served in any suit or proceeding
arising out of or relating to the Securities, the Guarantees or this Indenture
that may be
-22-
instituted in any Federal or State court in the Borough of Manhattan, The City
of New York or brought under Federal or State securities laws or brought by the
Trustee (whether in its individual capacity or in its capacity as a trustee
hereunder), and the Company, by execution and delivery of this Indenture, hereby
accepts such designation, (ii) submits to the jurisdiction of any such court in
any such suit or proceeding, and (iii) agrees that service of process upon the
Company and written notice of said service to such Guarantor (mailed or
delivered to it at the address specified in Section 104) shall be deemed in
every respect effective service of process upon such Guarantor in any such suit
or proceeding. The Company further agrees to take any and all action, including
the filing of this Indenture and the execution and filing of any and all other
documents and instruments, as may be necessary to continue such designation and
appointment of the Company in full force and effect so long as this Indenture
shall be in full force and effect and so long as any of the Securities shall be
outstanding.
To the extent that any Guarantor has or hereafter may acquire
any immunity from jurisdiction of any court or from any legal process (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property, such
Guarantor hereby irrevocably waives such immunity in respect of its respective
obligations under this Indenture, the Securities and the Guarantees to the
fullest extent permitted by law.
SECTION 113. No Recourse Against Others.
--------------------------
A director, officer, employee or shareholder, as such, of the
Company or any Guarantor shall not have liability for any obligations of the
Company or any Guarantor under the Securities, the Guarantees or this Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. By accepting a Security, each Holder shall waive and release all
such liability. The waiver and release shall be part of the consideration for
the issue of the Securities.
SECTION 114. Rules by Trustee and Agents.
---------------------------
The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Security Registrar or Paying Agent may make reasonable
rules and set reasonable requirements for its functions.
SECTION 115. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or any Guaran-
-23-
tor. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture. This writing constitutes the entire agreement of the parties
with respect to the subject matter hereof. Unless expressly otherwise indicated
herein, an action or transaction permitted by one provision hereof must
nonetheless comply with all other applicable provisions hereof; and any action
or transaction not permitted by any provision of this Indenture will not be
permitted regardless of whether any other provision hereof might permit such
action or transaction.
SECTION 116. Trustee as Paying Agent and Security Registrar.
----------------------------------------------
The Company initially appoints the Trustee as Paying
Agent and Security Registrar.
SECTION 117. Acceptance of Trust.
-------------------
First Union National Bank of Virginia, the Trustee named
herein, hereby accepts the trusts in this Indenture declared and provided, upon
the terms and conditions hereinabove set forth.
ARTICLE TWO
The Securities
SECTION 201. Form and Dating.
---------------
(a) Global Securities. Securities offered and sold to QIBs in
-----------------
reliance on Rule 144A shall be issued initially substantially in the form of
Exhibit A hereto in the name of Cede & Co. as nominee of DTC, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. Any such
Security shall be referred to herein as the "144A Global Security." Securities
offered and sold in reliance on Regulation S shall be issued initially
substantially in the form of Exhibit A hereto in the name of Cede & Co. as
nominee of DTC, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. Any such Security shall be referred to herein as the
"Regulation S Global Security." Unrestricted Global Securities shall be issued
initially in accordance with Sections 206(b)(iv), 206(c)(ii) and 206(e) in the
name of Cede & Co. as nominee of DTC, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of each of the Global Security may from time to time be increased or
decreased by adjustments made on the records of the Trustee as hereinafter
provided.
-24-
Each Global Security shall represent such of the outstanding
Securities as shall be specified therein and each shall provide that it shall
represent the aggregate principal amount of outstanding Securities from time to
time endorsed thereon and that the aggregate principal amount of outstanding
Securities represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and transfers of interests
therein in accordance with the terms of this Indenture. Any endorsement of a
Global Security to reflect the amount of any increase or decrease in the
principal amount of outstanding Securities represented thereby shall be made by
the Trustee in accordance with reasonable instructions given by the Holder
thereof as required by Section 206 hereof.
Upon the issuance of the Global Security to DTC, DTC shall
credit, on its internal book-entry registration and transfer system, its
Participant's accounts with the respective interests owned by such Participants.
Interests in the Global Securities shall be limited to Participants, including
Euroclear and Cedel, and indirect Participants.
The Participants shall not have any rights either under this
Indenture or under any Global Security with respect to such Global Security held
on their behalf by DTC, and DTC may be treated by the Company, the Trustee and
any agent of the Company or the Trustee as the absolute owner of such Global Se-
curity for the purpose of receiving payment of or on account of the principal of
and, subject to the provisions of this Indenture, interest and Additional
Interest, if any, on the Global Securities and for all other purposes.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by DTC or impair,
as between DTC and its Participants, the operation of customary practices of
DTC governing the exercise of the rights of an owner of a beneficial interest in
any Global Security.
The provisions of the "Operating Procedures of the Euroclear
System" and "Terms and Conditions Governing Use of Euroclear" and the "General
Terms and Conditions of Cedel Bank" and "Customer Handbook" of Cedel, as in
effect from time to time, shall be applicable to interests in the Regulation S
Global Security that are held by the Participants through Euroclear or Cedel.
(b) Physical Securities. Securities offered and sold to
-------------------
Institutional Accredited Investors who are not also QIBs shall be issued
initially substantially in the form of Exhibit A hereto, in certificated form
and issued in the names of the purchasers thereof (or their nominees), duly
executed by the Company and authenticated by the Trustee as hereinafter
-25-
provided. Such Securities, together with any Securities subsequently issued,
whether pursuant to the terms of Section 206 hereof or otherwise, that are not
Global Securities, shall be referred to herein as the "Physical Securities."
(c) Securities. The provisions of the form of Securities
----------
contained in Exhibit A hereto are incorporated herein by reference. The
Securities and the Trustee's Certificates of Authentication shall be
substantially in the form of Exhibit A hereto. The Securities may have
notations, legends or endorsements required by law, stock exchange rule or
usage. The Company shall approve the form of the Securities and any notation,
legend or endorsement (including notations relating to the Guarantee) on them.
If required, the Securities may bear the appropriate legend regarding original
issue discount for federal income tax purposes. Each Security shall be dated the
date of its authentication. The terms and provisions contained in the Securities
shall constitute, and are hereby expressly made, a part of this Indenture.
SECTION 202. Execution and Authentication.
----------------------------
Two Officers of the Company shall sign the Securities for the
Company by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds
that office at the time the Trustee authenticates the Security, the Security
shall be valid nevertheless.
A Security shall not be valid until an authorized officer of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture.
The Trustee shall authenticate (i) Initial Securities for
issue on the Issue Date in the aggregate principal amount of $75,000,000,
(ii) Private Exchange Securities form time to time only in exchange for a like
principal amount of Initial Securities and (iii) Unrestricted Securities from
time to time only in exchange for a like principal amount of Initial Securities,
in each case upon a written order signed by an Officer of the Company. The order
shall be based upon a Board Resolution of the Company to similar effect filed
with the Trustee and shall specify the amount of Securities to be authenticated
and the date on which the original issue of Securities is to be authenticated.
The order shall also provide instructions concerning registration, amounts for
each Holder and delivery. The aggregate principal amount of Securities
outstanding at any time may not exceed $75,000,000 except as provided in
Section 207. The Securities shall be issued only in registered form,
-26-
without coupons and only in denominations of $1,000 and any integral multiple
thereof.
SECTION 203. Registrar and Paying Agent.
--------------------------
The Company shall maintain an office or agency where
Securities may be presented for registration of transfer or for exchange
("Registrar") and an office or agency where Securities may be presented for
---------
payment ("Paying Agent"). The Company may have one or more co-Registrars and one
------------
or more additional paying agents. The term "Paying Agent" includes any
additional paying agent.
The Company shall enter into an appropriate agency agreement
with any Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent and shall, if required,
incorporate the provisions of the TIA. The Company shall notify the Trustee of
the name and address of any such Agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation in accordance with the provisions of Section 507.
The Company initially appoints the Trustee as Registrar and
Paying Agent. The Company shall give written notice to the Trustee in the event
that the Company decides to act as Registrar.
SECTION 204. Paying Agent To Hold Money in Trust.
-----------------------------------
The Company shall require each Paying Agent to agree in
writing to hold in trust for the benefit of Securityholders or the Trustee all
money held by the Paying Agent for the payment of principal of or interest on
the Securities (whether such money has been paid to it by the Company or any
other obligor on the Securities), and the Company and the Paying Agent shall
each notify the Trustee of any default by the Company (or any other obligor on
the Securities) in making any such payment. The Company at any time may require
a Paying Agent to pay all money held by it to the Trustee and account for any
funds disbursed and the Trustee may at any time during the continuance of any
payment default, upon written request to a Paying Agent, require such Paying
Agent to pay all money held by it to the Trustee and to account for any funds
disbursed. Upon making such payment the Paying Agent shall have no further li-
ability for the money delivered to the Trustee.
SECTION 205. Securityholder Lists.
--------------------
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of Securityholders. If the Trustee is
-27-
not the Registrar, the Company shall furnish to the Trustee at least five
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.
SECTION 206. Transfer and Exchange.
---------------------
(a) Transfer and Exchange of Global Securities. Transfer of
------------------------------------------
the Global Securities shall be by delivery. Global Securities will be exchanged
by the Company for Physical Securities only (i) if DTC notifies the Company
that it is unwilling or unable to continue to act as depositary with respect to
the Global Securities or ceases to be a clearing agency registered under the
Exchange Act and, in either case, a successor depositary registered as a
clearing agency under the Exchange Act is not appointed by the Company within
120 days, (ii) at any time if the Company in its sole discretion determines that
the Global Securities (in whole but not in part) should be exchanged for
Physical Securities or (iii) if the owner of an interest in the Global
Securities requests such Physical Securities, following an Event of Default
under this Indenture, in a writing delivered through DTC to the Trustee.
Upon the occurrence of any of the events specified in the
previous paragraph, Physical Securities shall be issued in such names as DTC
shall instruct the Trustee and the Trustee shall cause the aggregate principal
amount of the applicable Global Security to be reduced accordingly and direct
DTC to make a corresponding reduction in its book-entry system. The Company
shall execute and the Trustee shall authenticate and deliver to the Person
designated in such instructions a Physical Security in the appropriate
principal amount. The Trustee shall deliver such Physical Securities to the
Persons in whose names such Securities are so registered. Physical Securities
issued in exchange for an Initial Global Security pursuant to this Section
206(a) shall bear the Securities Act Legend and shall be subject to all
restrictions on transfer contained therein. Global Securities may also be
exchanged or replaced, in whole or in part, as provided in Sections 207 and 208.
Every Security authenticated and delivered in exchange for, or in lieu of, a
Global Security or any portion thereof, pursuant to Section 207 or 208, shall be
authenticated and delivered in the form of, and shall be, a Global Security. A
Global Security may not be exchanged for another Security other than as
provided in this Section 206(a).
(b) Transfer and Exchange of Interests in Global Securities.
-------------------------------------------------------
The transfer and exchange of interests in Global Securities shall be effected
through DTC, in accordance with this Indenture and the procedures of DTC
therefor. Interests in Initial Global Securities shall be subject to
restrictions
-28-
on transfer comparable to those set forth herein to the extent required by the
Securities Act. The Trustee shall have no obligation to ascertain DTC's
compliance with any such restrictions on transfer. Transfers of interests in
Global Securities shall also require compliance with subparagraph (i) below, as
well as one or more of the other following subparagraphs as applicable:
(i) All Transfers and Exchanges of Interests in Global
--------------------------------------------------
Securities. In connection with all transfers and exchanges of interests
----------
in Global Securities (other than transfers of interests in a Global
Security to Persons who take delivery thereof in the form of an
interest in the same Global Security), the transferor of such interest
must deliver to the Registrar (1) instructions given in accordance with
the Applicable Procedures from a Participant or an indirect
Participant directing DTC to credit or cause to be credited an interest
in the specified Global Security in an amount equal to the interest to
be transferred or exchanged, (2) a written order given in accordance
with the Applicable Procedures containing information regarding the
Participant account to be credited with such increase and (3)
instructions given by the Holder of the Global Security to effect the
transfer referred to in (1) and (2) above.
(ii) Transfer of Interests in the Same Initial Global
------------------------------------------------
Security. Interests in any Initial Global Security may be transferred
--------
to Persons who take delivery thereof in the form of an interest in the
same Initial Global Security in accordance with the transfer
restrictions set forth in Section 206(f) hereof.
(iii) Transfer of Interests to Another Initial Global
-----------------------------------------------
Security. Interests in any Initial Global Security may be transferred
--------
to Persons who take delivery thereof in the form of an interest in
another Initial Global Security if the Registrar receives the
following:
(A) if the transferee will take delivery in the form
of an interest in the 144A Global Security, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item 1 thereof; or
(B) if the transferee will take delivery in the form
of an interest in the Regulation S Global Security, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item 2 thereof.
-29-
(iv) Transfer and Exchange of Interests in Initial Global
----------------------------------------------------
Security for Interests in an Unrestricted Global Security. Interests in
---------------------------------------------------------
any Initial Global Security may be exchanged by the holder thereof for
an interest in the Unrestricted Global Security or transferred to a
Person who takes delivery thereof in the form of an interest in the
Unrestricted Global Security if:
(A) such exchange or transfer is effected pursuant to
the Exchange Registration Statement in accordance with the
Registration Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement; or
(C) the Registrar receives the following:
(1) if the holder of such an interest in an Initial
Global Security proposes to exchange it for an interest
in the Unrestricted Global Security, a certificate from
such Holder in the form of Exhibit C hereto, including
the certifications in item 1(a) thereof;
(2) if the holder of such an interest in an Initial
Global Security proposes to transfer it to a Person who
shall take delivery thereof in the form of an interest
in an Unrestricted Global Security, a certificate in the
form of Exhibit B hereto, including the certification in
item 4 thereof; and
(3) in each such case set forth in this paragraph
(C), an Opinion of Counsel in form reasonably acceptable
to the Company, to the effect that such exchange or
transfer is in compliance with the Securities Act and,
that the restrictions on transfer contained herein and
in Section 206(f) hereof are not required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to paragraph (B) above at a
time when an Unrestricted Global Security has not yet been issued, the
Company shall issue and, upon receipt of an authentication order in
accordance with Section 202, the Trustee shall authenticate one or
more Unrestricted Global Securities in an aggregate principal amount
equal to the principal amount of interests in the Initial Global
Security transferred pursuant to paragraph (B) above.
-30-
(v) Notation by the Trustee of Transfer of Interests Among
------------------------------------------------------
Global Securities. Upon satisfaction of the requirements for transfer
-----------------
of interests in Global Securities pursuant to clauses (iii) or (iv)
above, the Trustee shall reduce or cause to be reduced the aggregate
principal amount of the relevant Global Security from which the
interests are being transferred, and increase or cause to be increased
the aggregate principal amount of the Global Security to which the
interests are being transferred, in each case, by the principal amount
so transferred and shall direct DTC to make corresponding adjustments
in its book-entry system. No transfer of interests of a Global Security
shall be effected until, and any transferee pursuant thereto shall
succeed to the rights of a holder of such interests only when, the
Registrar has made appropriate adjustments to the applicable Global
Security in accordance with this paragraph.
(c) Transfer or Exchange of Physical Securities for
-----------------------------------------------
Interests in a Global Security.
- ------------------------------
(i) If any Holder of Physical Securities required to contain
the Securities Act Legend proposes to exchange such Securities for an
interest in a Global Security or to transfer such Physical Securities
to a Person who takes delivery thereof in the form of an interest in a
Global Security, then, upon receipt by the Registrar of the following
documentation (all of which may be submitted by facsimile):
(A) if the Holder of such Physical Registered Securities
proposes to exchange such Securities for an interest in an
Initial Global Security, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications
in item 2 thereof;
(B) if such Physical Securities are being transferred to
a QIB in accordance with Rule 144A under the Securities
Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item 1 thereof; or
(C) if such Physical Securities are being transferred to
a Non-U.S. Person (as defined in Regulation S) in an
offshore transaction in accordance with Rule 904 under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item 2
thereof;
the Trustee shall cancel the Physical Securities, increase or cause to
be increased the aggregate principal amount
-31-
of, in the case of clause (B) above, the 144A Global Security, in the
case of clause (C) above, the Regulation S Global Security, and direct
DTC to make a corresponding increase in its book-entry system.
(ii) A Holder of Physical Securities required to contain the
Securities Act Legend may exchange such Securities for an interest in
the Unrestricted Global Security or transfer such Restricted Physical
Securities to a Person who takes delivery thereof in the form of an
interest in the Unrestricted Global Security only:
(A) if such exchange or transfer is effected pursuant
to the Exchange Registration Statement in accordance with the
Registration Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement;
(C) upon receipt by the Registrar of the following
documentation (all of which may be submitted by facsimile):
(1) if the Holder of such Physical Securities
proposes to exchange such Securities for an interest in
the Unrestricted Global Security, a certificate from
such Holder in the form of Exhibit C hereto, including
the certifications in item 1(b) thereof;
(2) the Holder of such Registered Securities
proposes to transfer such Securities to a Person who
shall take delivery thereof in the form of an interest
in the Unrestricted Global Security, a certificate in
the form of Exhibit B hereto, including the
certifications in item 4 thereof; and
(3) in each such case set forth in this paragraph
(C), an Opinion of Counsel in form reasonably acceptable
to the Company, to the effect that such exchange or
transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and
in Section 206(f) hereof are not required in order to
maintain compliance with the Securities Act.
If any such transfer is effected pursuant to paragraph (B) above at a
time when an Unrestricted Global Security has not yet been issued, the
Company shall issue and, upon receipt of an authentication order in
accordance with Sec-
-32-
tion 202, the Trustee shall authenticate (i) one or more Unrestricted
Global Securities in an aggregate principal amount equal to the
principal amount of Physical Securities transferred pursuant to
paragraph (B) above.
(d) Transfer and Exchange of Physical Securities.
--------------------------------------------
(i) Transfer of a Physical Security to Another Physical
---------------------------------------------------
Security. Following the occurrence of one or more of the events
--------
specified in Section 206(a), a Physical Security may be transferred to
Persons who take delivery thereof in the form of another Physical
Security if the Registrar receives the following:
(A) if the transfer is being effected pursuant to and in
accordance with Rule 144A, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item 3(a) thereof; or
(B) if the transfer is being effected pursuant to and in
accordance with Regulation S, then the transferor must deliver
a certificate in the form of Exhibit B hereto, including the
certifications in item 3(b) thereof.
(ii) Transfer and Exchange of Restricted Physical Security
-----------------------------------------------------
for Physical Security Which Does Not Bear the Securities Act Legend.
-------------------------------------------------------------------
Following the occurrence of one or more of the events specified in
Section 206(a), a Restricted Physical Security may be exchanged by the
Holder thereof for a Physical Security or transferred to a Person who
takes delivery thereof in the form of a Physical Security which does
not bear the Securities Act Legend if:
(A) such exchange or transfer is effected pursuant to the
Exchange Registration Statement in accordance with the
Registration Rights Agreement;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration
Rights Agreement; or
(C) the Registrar receives a certificate from such Holder
in the form of Exhibit C hereto, including the certifications
in item 1(c) thereof and an Opinion of Counsel in form
reasonably acceptable to the Company, to the effect that such
exchange or transfer is in compliance with the Securities Act
and, that the restrictions on transfer contained herein and in
Section 206(f) hereof are not required
-33-
in order to maintain compliance with the Securities Act.
(iii) Exchange of Physical Securities. When Physical
-------------------------------
Securities are presented by a Holder to the Registrar with a request to
register the exchange of such Physical Securities for an equal
principal amount of Physical Securities of other authorized
denominations, the Registrar shall make the exchange as requested only
if the Physical Securities are endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Registrar duly
executed by such Holder or by his attorney duly authorized in writing
and shall be issued only in the name of such Holder or its nominee. The
Physical Securities issued in exchange for Physical Securities shall
bear the Securities Act Legend and shall be subject to all restrictions
on transfer contained herein in each case to the same extent as the
Physical Securities so exchanged.
(iv) Return of Physical Securities. In the event of a
-----------------------------
transfer pursuant to clauses (i) or (ii) above and the Holder thereof
as delivered certificates representing an aggregate principal amount of
Securities in excess of that to be transferred, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Physical Security or
Securities of any authorized denomination requested by the Holder, in
an aggregate principal amount equal to the portion of the Security not
so transferred.
(e) Exchange Offer. Upon the occurrence of the Exchange
--------------
Offer (as defined in the Registration Rights Agreement) in accordance with the
Registration Rights Agreement, the Company shall issue and, upon receipt of an
authentication order in accordance with Section 202, the Trustee shall
authenticate one or more Unrestricted Global Securities in an aggregate
principal amount equal to the principal amount of the interests in the Initial
Global Securities and Restricted Physical Securities tendered for acceptance by
persons participating therein. Concurrently with the issuance of such
Securities, the Trustee shall cause the aggregate principal amount of the
applicable Initial Global Securities to be reduced accordingly and direct DTC to
make a corresponding reduction in its book-entry system. The Trustee shall
cancel any Restricted Physical Certificates in accordance with Section 209
hereof.
In the case that one or more of the events specified in
Section 206(a) have occurred, upon the occurrence of such Exchange Offer, the
Company shall issue and, upon receipt of an authentication order in accordance
with Section 202, the Trustee shall authenticate Unrestricted Physical
Securities in an aggregate principal amount equal to the principal amount of the
-34-
Restricted Physical Securities tendered for acceptance by persons participating
therein.
(f) Legends.
-------
Each Initial Global Security and each Restricted Physical
Security shall bear the legend (the "Securities Act Legend") in substantially
---------------------
the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY
EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED
HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY
BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) TO A PERSON
WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (b) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT OR (c) OUTSIDE
THE UNITED STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (2) TO THE COMPANY
OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
(g) Global Security Legend. Each Global Security shall bear
----------------------
a legend in substantially the following form:
"UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC") TO A NOMINEE OF DTC, OR BY ANY SUCH NOMINEE OF DTC,
OR BY DTC TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESEN-
-35-
TATIVE OF DTC, 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 SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC). ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 206 OF THE INDENTURE."
(h) Cancellation and/or Adjustment of Global Securities. At
---------------------------------------------------
such time as all interests in the Global Securities have been exchanged for
Physical Securities, all Global Securities shall be returned to or retained and
canceled by the Trustee in accordance with Section 209 hereof. At any time prior
to such cancellation, if any interest in a Global Security is exchanged for an
interest in another Global Security or for Physical Securities, the principal
amount of Securities represented by such Global Security shall be reduced
accordingly and an endorsement shall be made on such Global Security, by the
Trustee to reflect such reduction.
(i) General Provisions Relating to All Transfers and
------------------------------------------------
Exchanges.
- ---------
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Global
Securities and Physical Securities upon a written order signed by an
Officer of the Company or at the Registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any stamp or transfer tax or
similar governmental charge payable in connection therewith (other than
any such stamp or transfer taxes or similar governmental charge
payable upon exchange or transfer pursuant to Sections 208, 806, 916,
917 and 1008 hereof).
(iii) All Global Securities and Physical Securities issued
upon any registration of transfer or exchange of
-36-
Global Securities or Physical Securities shall be the valid obligations
of the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Global Securities or Physical
Securities surrendered upon such registration of transfer or exchange.
(iv) The Company shall not be required (A) to issue, to
register the transfer of or to exchange Securities during a period
beginning at the opening of business 15 days before the day of any
selection of Securities for redemption under Section 1004 hereof and
ending at the close of business on the day of selection, (B) to
register the transfer of or to exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of any
Security being redeemed in part or (C) to register the transfer of or
to exchange a Security between a record date and the next succeeding
Interest Payment Date.
(v) Prior to due presentment for the registration of a
transfer of any Security, the Trustee, any Agent and the Company may
deem and treat the Person in whose name any Security is registered as
the absolute owner of such Security for the purpose of receiving
payment of principal of and interest on such Securities and for all
other purposes, and none of the Trustee, any Agent or the Company
shall be affected by notice to the contrary.
SECTION 207. Replacement Securities.
----------------------
If any mutilated Security is surrendered to the Trustee, the
Company shall execute, the Guarantors shall execute their Guarantee endorsed
thereon and the Trustee shall authenticate and deliver in exchange therefor a
new Security of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any
Security and (ii) such security or indemnity as may be reasonably required by
them to save each of them, the Guarantors and any agent of any of them harmless,
then, in the absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the Company shall execute and upon
its request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and principal
amount, having endorsed thereon the Guarantee of the Guarantors, duly executed
by the Guarantors, and bearing a number not contemporaneously outstanding.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient
-37-
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee)
connected therewith.
Every new Security issued pursuant to this Section in lieu of
any destroyed, lost or stolen Security, and the Guarantee endorsed thereon,
shall constitute an original additional contractual obligation of the Company
and the Guarantors whether or not the destroyed, lost or stolen Security shall
be at any time enforceable by anyone, and shall be entitled to all the 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 208. 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, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and having
endorsed thereon the Guarantees substantially of the tenor of the definitive
Guarantees in lieu of which they are issued, duly executed by the Guarantors,
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities and the Guarantees may
determine, as evidenced by their execution of such Securities and Guarantees.
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 any office or agency of the Company designated pursuant to Section
902, without charge to the Holder. 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 and like tenor having endorsed
thereon Guarantees executed by the Guarantors. Until so exchanged the temporary
Securities shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities.
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SECTION 209. Cancellation.
------------
All Securities surrendered for payment, redemption or
registration of transfer or exchange shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and shall be promptly canceled by
it. The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Com pany
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 by the Trustee and upon the
Company's written request, the Trustee shall deliver a certificate of
destruction to the Company.
SECTION 210. Defaulted Interest.
------------------
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective Predecessor 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, 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 prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more
than 15 days prior to the date of the proposed payment. The Trustee
shall promptly notify the Company of such Special Record Date and, in
the name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder at
his address as it appears in the Security Regis-
-39-
ter, not less than five Business 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 not later than the fifteenth day after such
Special Record Date to the Persons in whose names the Securities (or
their respective Predecessor Securities) are registered at the close
of business on such Special Record Date.
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payments shall be
deemed practicable by the Trustee.
SECTION 211. CUSIP or CINS Number.
--------------------
The Company in issuing the Securities may use a "CUSIP" or
"CINS" number, and if so, such CUSIP or CINS number shall be included in notices
of redemption or exchange as a convenience to Holders; provided that any such
--------
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP or CINS number printed in the notice or on the Securities,
and that reliance may be placed only on the other identification numbers printed
on the Securities. The Company will promptly notify the Trustee of any change in
the CUSIP or CINS number.
SECTION 212. Payments of Interest.
--------------------
(a) The Holder of a Physical Security at the close of business
on the regular record date with respect to any Interest Payment Date shall be
entitled to receive the interest and Additional Interest, if any, payable on
such Interest Payment Date notwithstanding any transfer or exchange of such
Physical Security subsequent to the regular record date and prior to such
Interest Payment Date, except if and to the extent the Company shall default in
the payment of the interest or Additional Interest due on such Interest Payment
Date, in which case such Defaulted Interest and Additional Interest, if any,
shall be paid in accordance with Section 210; provided that, in the event of an
exchange of a Physical Security for a beneficial interest in any Global Security
subsequent to a regular record date or any special record date and prior to or
on the related Interest Payment Date or other payment date under Section 210,
any payment of the interest and Additional Interest payable on such payment
date with respect to any such Physical Security shall be made to the Person in
whose name
-40-
such Physical Security was registered on such record date. Payments of interest
on the Global Securities will be made to the Holder of the Global Security on
each Interest Payment Date; provided that, in the event of an exchange of all or
a portion of a Global Security for Physical Security subsequent to the regular
record date or any special record date and prior to or on the related Interest
Payment Date or other payment date under Section 210 any payment of interest or
Additional Interest payable on such Interest Payment Date or other payment date
with respect to the Physical Security shall be made to the Holder of the Global
Security.
(b) The Trustee shall pay interest and Additional Interest, if
any, to DTC, with respect to any Global Security held by DTC, on the applicable
Interest Payment Date in accordance with instructions received from DTC at
least five Business Days before the applicable Interest Payment Date.
ARTICLE THREE
Satisfaction and Discharge
SECTION 301. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall cease to be of further effect (except as
to any surviving rights of registration of transfer or exchange of 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
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities which have been
destroyed, lost or stolen and which have been replaced or paid
as provided in Section 207 and (ii) Securities for whose
payment money has thereto fore been deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as
provided in Section 903) have been delivered to the Trustee
for cancellation; or
(B) all such Securities not theretofore delivered to
the Trustee for cancellation
(i) have become due and payable, or
-41-
(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 in the case of (i), (ii) or (iii) above has
irrevocably deposited or caused to be irrevocably deposited
with the Trustee as trust funds in trust for the purpose an
amount in cash sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to
the Trustee for cancellation, for principal (and premium, if
any) and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other
sums payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture pursuant to
this Article Three, the obligations of the Company to the Trustee under Section
507, and, if money shall have been deposited with the Trustee pursuant to
subclause (B) of clause (1) of this Section, the obligations of the Trustee
under Section 302 and the last paragraph of Section 903 shall survive.
SECTION 302. Application of Trust Money.
--------------------------
Subject to the provisions of the last paragraph of Section
903, all money deposited with the Trustee pursuant to Section 301 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
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee.
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ARTICLE FOUR
Remedies
SECTION 401. Events of Default.
-----------------
"Event of Default", whenever 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):
(1) failure to pay the principal of (or premium, if any,
on) any Security when due; or
(2) failure to pay any interest on any Security when due,
and such failure continues for a period of 30 days; or
(3) default, on the applicable Purchase Date, in the
purchase of Securities required to be purchased by the Company pursuant
to an Offer to Purchase; or
(4) failure to perform or to comply with any of the
provisions of Section 701; or
(5) failure to perform any covenant or agreement of the
Company in this Indenture or the Securities (other than a covenant or
agreement referred to in the foregoing clause (1), (2), (3) or (4)) and
such failure continues for the period and after the notice specified
below; or
(6) default under the terms of one or more instruments
evidencing or securing Indebtedness for money borrowed by the Company
or any Subsidiary of the Company having an outstanding principal
amount of $5 million or more individually or in the aggregate, which
results in the acceleration of the payment of such Indebtedness or
which shall constitute the failure to pay principal when due at the
stated maturity of such Indebtedness; or
(7) the rendering of a final judgment or judgments (not
subject to appeal) against the Company or any Subsidiary of the
Company in an aggregate amount of $5 million or more which remains
undischarged or unstayed for a period of 60 days after the date on
which the right to appeal has expired; or
(8) the entry by a court having jurisdiction in the
premises of (A) a decree or order for relief in respect of
-43-
the Company or any Material Subsidiary in an involuntary case or
proceeding under any applicable U.S. Federal or State or other
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company or any Material Subsidiary a
bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company or any Material Subsidiary under any applicable
U.S. Federal or State or other 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 the property of the Company or any Material
Subsidiary, or ordering the winding up or liquidation of the affairs of
the Company or any Material Subsidiary, and the continuance of any such
decree or order for relief or any such other decree or order unstayed
and in effect for a period of 30 consecutive days; or
(9) the commencement by the Company or any Material
Subsidiary of a voluntary case or proceeding under any applicable U.S.
Federal or State or other bankruptcy, insolvency, reorganization or
other similar law or of any other case or proceeding to be adjudicated
a bankrupt or insolvent, or the consent by the Company or any Material
Subsidiary to the entry of a decree or order for relief in respect of
the Company or any Material Subsidiary in an involuntary case or
proceeding under any applicable U.S. Federal or State or other
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against
the Company or any Material Subsidiary, or the filing by the Company or
any Material Subsidiary of a petition or answer or consent seeking
reorganization or relief under any applicable U.S. Federal or State,
Canadian federal or provincial or other applicable law, or the consent
by the Company or any Material Subsidiary to the filing of such
petition or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or similar
official of the Company or any Material Subsidiary or of any
substantial part of the property of the Company or any Material
Subsidiary, or the making by the Company or any Material Subsidiary of
an assignment for the benefit of creditors, or the admission by the
Company or any Material Subsidiary in writing of its inability to pay
its debts generally as they become due; and
(10) the Guarantee of any Guarantor which is a Material
Subsidiary ceases to be in full force and effect (other than in
accordance with the terms of such Guarantee and this Indenture) or is
declared null and void and unenforceable or found to be invalid or any
Guarantor which is
-44-
a Material Subsidiary denies its liability under its Guarantee (other
than by reason of a release of such Guarantor from its Guarantee in
accordance with the terms of such Guarantee and this Indenture).
A Default under Section 401(5) hereof is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
in aggregate principal amount of the outstanding Securities notify the Company
and the Trustee, of the Default and the Company does not cure the Default within
30 days after receipt of the notice. The notice must specify the Default, demand
that it be remedied and state that the notice is a "Notice of Default." If such
Default is cured within such time period, it ceases.
SECTION 402. Acceleration of Maturity; Rescission and Annulment.
--------------------------------------------------
If an Event of Default (other than an Event of Default with
respect to the Company specified in Section 401(8) or (9)) occurs and is
continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of the out standing Securities may declare the principal of all
the Securities to be due and payable immediately, by a notice in writing to
the Company (and to the Trustee if given by Holders), and upon any such
declaration such principal and any accrued interest shall become immediately due
and payable. If an Event of Default with respect to the Company specified in
Section 401(8) or (9) occurs, the principal of and any accrued interest on the
Securities then outstanding shall ipso facto become immediately due and payable
---- -----
without any declaration or other act on the part of the Trustee or any Holder.
At any time after such a 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 hereinafter in this Article provided, the Holders of
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
(1) the Company has paid or deposited or caused to be paid
or deposited with the Trustee a sum sufficient to pay
(A) all overdue interest on all Securities,
(B) the principal of (and premium, if any, on) any
Securities which have become due otherwise than by such
declaration of acceleration (including any Securities required
to have been purchased on the Purchase Date pursuant to an
Offer to Purchase made
-45-
by the Company) and interest thereon at the rate provided by
the Securities,
(C) interest upon overdue interest at the rate provided
by the Securities, and
(D) all sums paid or advanced by the Trustee hereunder
and the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel;
and
(2) all Events of Default, other than the nonpayment of the
principal of Securities which have become due solely by such
declaration of acceleration, have been cured or waived as provided in
Section 413.
No such rescission shall affect any subsequent Default or
impair any right consequent thereon.
SECTION 403. Collection of Indebtedness and Suits for Enforcement by Trustee.
---------------------------------------------------------------
The Company covenants that if
(1) 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
(2) Default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof or, with
respect to any Security required to have been purchased pursuant to an
Offer to Purchase made by the Company, at the Purchase Date 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, and interest on
any overdue principal (and premium, if any) and on any overdue interest, at the
rate provided by the Securities, and, in addition thereto, such further amount
as shall be sufficient to cover the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
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, may prosecute such proceeding to judgment or final decree and may
enforce the
-46-
same against the Company, any Guarantor 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, any Guarantor 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 by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy.
SECTION 404. Trustee May File Proofs of Claim.
--------------------------------
In case of any judicial proceeding relative to the Company,
any Guarantor or any other obligor upon the Securities, its property or its
creditors, the Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all actions authorized under the Trust
Indenture Act in order to have claims of the Holders and the Trustee allowed in
any such proceeding. In particular, the Trustee shall be authorized 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 other 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 to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 507.
No provision of this Indenture shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee in vote in respect of the claim of any Holder in any such proceeding.
SECTION 405. 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
-47-
own name 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 such
judgment has been recovered.
SECTION 406. Application of Money Collected.
------------------------------
Any money collected by the Trustee pursuant to this Article
shall be applied 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
(or 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 507; and
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities 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 (and premium, if any) and interest, respectively.
SECTION 407. Limitation on Suits.
-------------------
Subject to Section 408, no Holder of any Security shall have
any right to institute any proceeding, judicial or otherwise, with respect to
this Indenture, the Guarantees or the Securities or for any other remedy
hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in aggregate 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;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute any such
proceeding; and
-48-
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of
a majority in aggregate principal amount of the outstanding Securities;
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 to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 408. 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, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Section 210) interest on such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date or in the case of an Offer to Purchase made by the Company and
required to be accepted as to such Security, on the Purchase 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 409. 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
determined adversely to the Trustee or to such Holder, then and in every such
case, subject to any determination in such proceeding, the Company, the
Guarantors, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 410. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities as described in
Section 207, 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
-49-
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 411. Delay or Omission Not Waiver.
----------------------------
No delay or omission of the Trustee or of any Holder 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 412. Control by Holders.
------------------
The Holders of 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
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(3) the Trustee may refuse to follow any direction that the Trustee
determines in good faith is unduly prejudicial to the rights of other
Holders or would involve the Trustee in personal liability.
The Trustee shall be entitled to indemnification reasonably satisfactory to it
against losses or expenses caused by the taking of such action.
SECTION 413. 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
(1) in the payment of the principal of (or premium, if any) or
interest on any Security (including any Security which is required to have
been purchased pursuant to an Offer to Purchase which has been made by the
Company), or
-50-
(2) in respect of a covenant or provision hereof which under Article
Eight cannot be modified or amended without the consent of the Holder of
each outstanding Security affected.
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 414. Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act. This Section 414 shall not apply to a suit by the Trustee, a suit
by a Holder or Holders of more than 10% in aggregate principal amount of the
outstanding Securities or any suit instituted by any Holder to receive the
payment of the principal of (and 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 the Redemption Date or, in the case of an Offer to
Purchase made by the Company and required to be accepted as to such Security, on
the Purchase Date).
SECTION 415. Waiver of Stay or Extension Laws.
--------------------------------
Each of the Company and the Guarantors covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and each of the
Company and the Guarantors (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantages 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.
-51-
ARTICLE FIVE
The Trustee
SECTION 501. Certain Duties and Responsibilities.
-----------------------------------
The duties and responsibilities of the Trustee shall be as provided by
Section 315 of the Trust Indenture Act (or any successor section of the Trust
Indenture Act which sets forth the duties and responsibilities of trustees under
the Trust Indenture Act). Notwithstanding the foregoing, 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 or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not assured to it. Whether or not therein expressly
so provided, every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 502. Notice of Default.
-----------------
If a Default occurs and is known to the Trustee, the Trustee shall,
subject to the provisions of the next sentence, give the Holders notice of such
Default. Except in the case of a Default described in Section 401(1), (2) or
(3), the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interest of the Holders.
SECTION 503. Certain Rights of Trustee.
-------------------------
Subject to the provisions of Section 501:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, 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;
(2) 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 of the Company may be sufficiently
evidenced by a Board Resolution of the Company;
-52-
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(5) 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 reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction;
(6) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company
or any Guarantor, personally or by agent or attorney during normal business
hours; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
SECTION 504. Not Responsible for Issuance of Securities.
-------------------------------------------
The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities or of the Guarantees endorsed
thereon (except for the Trustee's certificate of authentication) or the ability
of the Company or the Guarantors to discharge their respective obligations here
under, including payment when due of the principal of, premium
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if any, and interest on the Securities. The Trustee shall not be accountable for
the use or application by the Company of the proceeds thereof.
SECTION 505. May Hold Securities.
-------------------
The Trustee, any Paying Agent or any Security Registrar or any other
agent for the Company or any Guarantor, in its individual or any other capacity,
may become the owner or pledgee of Securities and, subject to Sections 508 and
513, may otherwise deal with the Company or any Guarantor with the same rights
it would have if it were not Trustee, Paying Agent, Security Registrar or such
other agent, as the case may be.
SECTION 506. Money Held in Trust.
-------------------
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company or any Guarantor.
SECTION 507. Compensation and Reimbursement.
------------------------------
Each of the Company and the Guarantors agrees, jointly and severally,
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of
this Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense (including reasonable attorneys' fees)
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust, including
the costs and expenses of defending itself against any claim or liability
in connection with the exercise or performance of any of its powers or
duties hereunder.
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To secure the Company's and the Guarantors' payment obligations in
this Section 507, the Trustee shall have a lien prior to the Securities on all
money or property held or collected by the Trustee, except that held in trust
to pay the principal of or premium, if any, or interest on particular
Securities.
Both the Company's and the Guarantors' payment obligations pursuant to
this Section 507 shall survive the discharge of this Indenture. When the
Trustee incurs expenses after the occurrence of an Event of Default specified
in Section 501(8) or (9), the expenses are intended to constitute expenses of
administration under any bankruptcy law.
SECTION 508. Disqualification; Conflicting Interests.
---------------------------------------
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 509. Corporate Trustee Required; Eligibility.
---------------------------------------
There shall at all times be a Trustee hereunder which shall be a
Person that is eligible pursuant to the Trust Indenture Act to act as such and
has a combined capital and surplus of at least $150,000,000. If such Person
publishes reports of condition at least annually, pursuant to law or to the
requirements of any supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Person shall be deemed
to be its combined capital and surplus as set forth in its most recent report
of condition so published. If at any time the Trustee shall cease to be eligi-
ble in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
SECTION 510. Resignation and Removal; Appointment of
Successor.
---------------------------------------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 511.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company and the Guarantors. 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
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petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(c) The Trustee may be removed at any time by Holders of a majority in
aggregate principal amount of the outstanding Securities.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 508 after written
request therefor by the Company or by any Holder, or
(2) the Trustee shall cease to be eligible under Section 509 and shall
fail to resign after written request therefor by the Company or by any
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 such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 514, any Holder may, on behalf of himself
and all other Holders, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of 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 Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee.
Within one year after the successor Trustee takes office the Holders of a
majority in aggregate principal amount of the outstanding Securities may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 104. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 511. Acceptance of Appointment by Successor.
--------------------------------------
Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and the Guarantors 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
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Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee; but, on
request of the Company or any Guarantor or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder subject
to the lien provided in Section 507. Upon request of any such successor Trustee,
the Company and the Guarantors shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
SECTION 512. 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 the corporate trust busi-
ness of the Trustee, shall be the successor of the Trustee hereunder, provided
such corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
SECTION 513. Preferential Collection of Claims Against
the Company and Any Guarantor.
-----------------------------------------
If and when the Trustee shall be or become a creditor of the Company,
any Guarantor or any other obligor upon the Securities, the Trustee shall be
subject to the provisions of the Trust Indenture Act regarding the collection of
claims against the Company, such Guarantor or any such other obligor.
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ARTICLE SIX
Holders' Lists and Reports by Trustee and the Company
SECTION 601. 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 15 days prior to each Interest Payment
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 request in writing, within
30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the
time such list is furnished;
excluding from any such list, names and addresses received by the Trustee in its
- ---------
capacity as Security Registrar.
SECTION 602. Preservation of Information;
Communication to Holders.
----------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 601 and the names and
addresses of Holders received by the Trustee in its capacity as Security Regis-
trar. The Trustee may destroy any list furnished to it as provided in Section
601 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities and the
corresponding rights and duties of the Trustee shall be provided by the Trust
Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company, the Guarantors and the Trustee that none of the
Company, any Guarantor, the Trustee nor any agent of any of them shall be held
accountable by reason of any disclosure of information as to the names and ad-
dresses of Holders made pursuant to the Trust Indenture Act.
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SECTION 603. Reports by Trustee.
------------------
(a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission, with the Company and each Guarantor.
The Company will notify the Trustee when the Securities are listed on any stock
exchange and of any delisting thereof.
SECTION 604. Reports by Company.
------------------
The Company and the Guarantors shall file with the Trustee and the
Commission, and transmit to Holders, such information, documents and other
reports, and such summaries thereof, as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant to the Trust
Indenture Act; provided that any such information, documents or reports required
to be filed with Commission pursuant to Section 13 or 15(d) of the Exchange Act
shall be filed with the Trustee within 15 days after the same is so required to
be filed with the Commission.
ARTICLE SEVEN
Consolidation and Merger
SECTION 701. Mergers, Consolidations and Certain
Sales of Assets.
-----------------------------------
Neither the Company nor any Subsidiary will consolidate or merge with
or into any Person, and the Company will not, and will not permit any of its
Subsidiaries to, sell, lease, convey or otherwise dispose of all or
substantially all of the Company's consolidated assets (as an entirety or sub-
stantially an entirety in one transaction or a series of related transactions,
including by way of liquidation or dissolution) to any Person unless, in each
such case:
(i) the entity formed by or surviving any such consolidation or
merger (if other than the Company or such Subsidiary, as the case may be),
or to which such sale, lease, conveyance or other disposition shall have
been made (the "Surviving Entity"), is a corporation organized and existing
under the laws of the United States, any state thereof or the District of
Columbia;
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(ii) the Surviving Entity assumes by supplemental indenture all of
the obligations of the Company or such Subsidiary, as the case may be, on
the Securities or such Subsidiary's Guarantee, as the case may be, and under
this Indenture;
(iii) immediately after giving effect to such transaction and the
use of any net proceeds therefrom on a pro forma basis, the Consolidated Net
Worth of the Company or the Surviving Entity (in the case of a transaction
involving the Company), as the case may be, would be at least equal to the
Consolidated Net Worth of the Company immediately prior to such
transaction;
(iv) immediately after giving effect to such transaction and the
use of any net proceeds therefrom on a pro forma basis, the Company or the
Surviving Entity (in the case of a transaction involving the Company), as
the case may be, could incur at least $1.00 of Indebtedness pursuant to
clause (a)(i) of Section 908;
(v) immediately before and after giving effect to such transaction
and treating any Indebtedness which becomes an obligation of the Company or
any of its Subsidiaries as a result of such transaction as having been In-
curred by the Company or such Subsidiary, as the case may be, at the time of
the transaction, no Default or Event of Default shall have occurred and be
continuing; and
(vi) if, as a result of any such transaction, property or assets of
the Company or a Subsidiary of the Company would become subject to a Lien
not excepted from the provisions described under Section 912, the Company,
any such Subsidiary or the Surviving Entity, as the case may be, shall have
secured the Securities as required by said Section 912.
The provisions of this Section 701 shall not apply to any
consolidation or merger of a Subsidiary of the Company with or into the Company
or a Wholly Owned Subsidiary of the Company or any transaction pursuant to which
a Guarantor's Guarantee is to be released in accordance with the terms of
Section 1103 in connection with any transaction complying with the provisions of
Section 916.
The Company or any Guarantor, as the case may be, will deliver to
the Trustee prior to consummation of the proposed transaction an Officers'
Certificate that the transaction upon consummation thereof would comply with all
of the requirements of this Section.
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SECTION 702. Successor Substituted.
---------------------
Upon any consolidation of the Company or any Subsidiary of the
Company with, or merger of the Company or any such Subsidiary into, any other
Person or any sale, lease, conveyance or other disposition of all or
substantially all of the Company's consolidated assets (as an entirety or
substantially as an entirety in one transaction or a series of related trans-
actions, including by way of liquidation or dissolution) in accordance with
Section 701, upon the execution of a supplemental indenture by the Surviving
Entity in form and substance satisfactory to the Trustee (as evidenced by the
Trustee's execution thereof), the Surviving Entity shall succeed to, and be
substituted for, and may exercise every right and power of and shall assume all
obligations of, the Company or such Subsidiary, as the case may be, under this
Indenture and the Securities or the Guarantees, as the case may be, with the
same effect as if such Surviving Entity had been named as the Company or such
Subsidiary, as the case may be, herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities or the Guarantees, as the case may be.
ARTICLE EIGHT
Supplemental Indentures
SECTION 801. Supplemental Indentures Without Consent
of Holders.
---------------------------------------
Without the consent of any Holders, the Company and the Guarantors,
when authorized by respective Board Resolutions, and the Trustee, at any time
and from time to time, may enter into one or more indentures supplemental
hereto, in form satisfactory to the Trustee, for any of the following purposes:
(1) 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; or
(2) to evidence the succession of another Person to any Guarantor and
the assumption by any such successor of the covenants of such Guarantor
herein and in the Guarantees; or
(3) to add to the covenants of the Company or the Guarantors for the
benefit of the Holders, or to surrender any right or power herein conferred
upon the Company or any Guarantor; or
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(4) to secure the Securities pursuant to the requirements of
Section 912 or otherwise; or
(5) to comply with any requirements of the Commission in order to
effect and maintain the qualification of this Indenture under the Trust
Indenture Act; or
(6) to cure any ambiguity; or
(7) to make any other change that does not adversely affect the rights
of any Holder; or
(8) to reflect the release of a Guarantor from its obligations with
respect to its Guarantee in accordance with the provisions of Section 1103
and to add a Guarantor pursuant to the requirements of Section 1107.
After an amendment by supplemental indenture under this Section, the
Company will mail to the Holders a notice describing the amendment; provided,
that, the failure to mail such notice will not affect the validity of any such
supplemental indenture.
SECTION 802. Supplemental Indentures with Consent of Holders.
-----------------------------------------------
With the consent of the Holders of not less than a majority in
aggregate principal amount of the outstanding Securities, the Company and the
Guarantors, when authorized by respective Board Resolutions, and the Trustee
may enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders under this Indenture; provided, however, that no such supplemental
-------- -------
indenture shall, without the consent of the Holder of each outstanding Security
affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of interest on, any Security, or reduce the principal amount thereof or the
rate of interest thereon or any premium payable thereon, or change the place
of payment where, or the coin or currency in which, any Security or any
principal, premium or interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date or, in the case of an Offer to Purchase, on or after the
applicable Purchase Date), or
(2) reduce the percentage in principal amount of the outstanding
Securities, the consent of whose Holders is
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required for any such supplemental indenture, or the consent of whose
Holders is required for any waiver provided for in this Indenture, or
(3) modify any of the provisions of this Section or Section 413,
except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each outstanding Security affected thereby, or
(4) modify the ranking or priority of the Securities or the Guarantee
of any Guarantor which is a Material Subsidiary, or release any Guarantor
which is a Material Subsidiary from any of its obligations under its
Guarantee or this Indenture otherwise than in accordance with the terms of
this Indenture, or
(5) modify the provisions relating to any Offer to Purchase (including
any related definitions) required under Section 916 or Section 917 in a
manner materially adverse to the Holders thereof.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such consent approves the substance thereof.
SECTION 803. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture 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 Section 501) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture, that such supplemental indenture
complies with the terms of this Indenture and that such supplemental indenture
is enforceable against the Company, the Guarantors or their respective
successors as applicable, in accordance with its terms. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
SECTION 804. 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 purpose; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
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SECTION 805. Conformity with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
SECTION 806. Reference in Securities to Supplemental Indentures.
--------------------------------------------------
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article 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 and the Guarantors
shall so determine, new Securities and the Guarantees endorsed thereon so
modified as to conform, in the opinion of the Company and the Guarantors, to
any such supplemental indenture may be prepared and executed by the Company and
the Guarantors and authenticated and delivered by the Trustee in exchange for
outstanding Securities.
SECTION 807. Revocation and Effect of Consents.
---------------------------------
(a) Until a supplemental indenture becomes effective, a consent to
it by a Holder of a Security 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, even if notation of the consent is not
made on any Security. However, any such Holder or subsequent Holder may revoke
the consent as to such Holder's Security or portion of a Security if the
Trustee receives written notice of revocation before the date the supplemental
indenture becomes effective. A supplemental indenture becomes effective in
accordance with its terms and thereafter binds every Holder.
(b) The Company may, but will not be obligated to, fix a record date
for the purpose of determining the Holders entitled to consent to any
supplemental indenture. If a record date is fixed, then notwithstanding the
provisions of clause (a) of this Section, those Persons who were Holders at such
record date (or their duly designated proxies), and only those Persons, will be
entitled to consent to such supplemental indenture or to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No consent will be valid or effective for more than 90 days after
such record date unless consents from Holders of the principal amount of
Securities required hereunder for such supplemental indenture to be effective
have also been given and not revoked within such 90-day period.
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ARTICLE NINE
Covenants
SECTION 901. Payment of Principal, Premium and Interest.
------------------------------------------
The Company will duly and punctually pay the principal of (and
premium, if any) and interest (including Additional Interest, if any) on the
Securities in accordance with and at the interest rates specified by the terms
of the Securities and this Indenture.
In the event the Company is not the Paying Agent, principal, premium,
if any, and interest will be considered paid on the date due if the Trustee or
Paying Agent holds on that date money deposited by the Company designated for
and sufficient to pay all principal, premium, if any, and interest then due. In
the event the Company, any of its Subsidiaries or any Affiliate of the Company
or any of its Subsidiaries is the Paying Agent, principal and interest will be
considered paid on the date actual payment is mailed or delivered to the Holders
entitled to such payments.
The Company shall pay interest on overdue principal at the same rate
per annum borne by the Securities. The Company shall pay interest on overdue
installments of interest at the same rate per annum borne by the Securities, to
the extent lawful.
SECTION 902. Maintenance of Office or Agency.
-------------------------------
The Company and the Guarantors will maintain in the Borough of
Manhattan, The City of New York, 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 and the Guarantors in respect of the Securities, any Guarantee
endorsed on the Securities and this Indenture may be served. The Company and the
Guarantors will give prompt written notice to the Trustee of the location, and
any change in the location, of such office or agency. If at any time the Company
or any Guarantor shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 104. The Company and the Guarantors hereby
initially designate the office of First Union National Bank, 40 Broad Street,
Fifth Floor, Suite 550, New York, New York 10004, as their office or agency in
the Borough of Manhattan, The City of New York, to receive all such presenta-
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tions, surrenders, notices or demands until changed as permitted in this
Indenture.
The Company may also from time to time designate one or more other
offices or agencies (in or outside the Borough of Manhattan, The City of New
York) where the Securities may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however,
-------- -------
that no such designation or rescission shall in any manner relieve the Company
or any Guarantor of their obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Company will
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
SECTION 903. Money for Security Payments To Be Held in Trust.
-----------------------------------------------
If the Company shall at any time act as its own Paying Agent, it
will, on or before each due date of the principal of (and premium, if any) or
interest on any of the Securities, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the principal (and pre-
mium, if any) or interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and will promptly notify
the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will, on
or before each due date of the principal of (and premium, if any) or interest on
any Securities, deposit with a Paying Agent a sum sufficient to pay the
principal (and 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 its action or 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:
(1) hold all sums held by it for the payment of the principal of (and
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;
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(2) 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
(and premium, if any) or interest; and
(3) 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.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent, as the case may be; 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 or United States Government Obligations deposited with the
Trustee or any Paying Agent, or then held by the Company, in trust for the
payment of the principal of (and premium, if any) or interest on any Security
and remaining unclaimed for two years after such principal (and premium, if
any) or interest has become due and payable shall be paid to the Company on
Company Request, or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Security shall thereafter, as an unsecured general
creditor, look only to the Company and the Guarantors for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
-------- -------
required to make any such repayment in excess of $50,000, may at the expense of
the Company cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in The City of New York, 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 publication, any unclaimed balance of such money then remaining
will be repaid to the Company.
SECTION 904. Existence.
---------
Subject to Article Seven and Section 916, the Company will do or cause
to be done all things necessary to, and will cause each of its Subsidiaries to,
preserve and keep in full force and effect its respective existence, rights
(charter and statutory) and franchises; provided, however, that neither the
-------- -------
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Company nor any of its Subsidiaries shall be required to preserve any such
right or franchise if the Board of Directors of the Company in good faith shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Company or such Subsidiary, as the case may be, and that the
loss thereof is not disadvantageous in any material respect to the Holders.
SECTION 905. Maintenance of Properties.
-------------------------
The Company will cause all material properties used or useful in the
conduct of its business or the business of any Subsidiary of the Company to be
maintained and kept in good condition, repair and working order 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 necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times;
provided, however, that nothing in this Section shall prevent the Company from
- -------- -------
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, as determined by the Company in good faith, desirable in the
conduct of its business or the business of any Subsidiary and not
disadvantageous in any material respect to the Holders.
SECTION 906. Payment of Taxes and Other Claims.
---------------------------------
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, all (i) taxes, assessments and
governmental charges levied or imposed upon the Company or any of its
Subsidiaries or upon the income, profits or property of the Company or any of
its Subsidiaries and (ii) lawful claims for labor, materials and supplies
which, in each case, if unpaid, might by law become a material liability or
Lien upon any property of the Company or any of its Subsidiaries; provided,
--------
however, that the Company shall not be required to pay or discharge or cause to
- -------
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and for which an
adequate reserve has been established to the extent required by GAAP.
SECTION 907. Maintenance of Insurance.
------------------------
The Company shall, and shall cause each of its Subsidiaries to, keep
at all times all of their properties which are of an insurable nature insured
against loss or damage with insurers believed by the Company to be responsible
to the extent that property of similar character is usually so insured by
corporations similarly situated and owning like properties
-68-
in accordance with good business practice. The Company shall, and shall cause
each of its Subsidiaries to, use the proceeds from any such insurance policy to
invest in the business of the Company or such Subsidiary, as the case may be, or
otherwise as the Board of Directors of the Company shall determine in its good
faith judgment.
SECTION 908. Limitation on Indebtedness.
--------------------------
(a) The Company will not, and will not permit any of its Subsidiaries
to, Incur any Indebtedness except, subject to the provisions set forth in
Section 909: (i) Indebtedness of the Company or its Subsidiaries, if immediately
after giving effect to the Incurrence of such Indebtedness and the receipt and
application of the net proceeds thereof, the Consolidated Cash Flow Ratio of the
Company for the four full fiscal quarters for which quarterly or annual
financial statements are available next preceding the Incurrence of such
Indebtedness, calculated on a pro forma basis as if such Indebtedness had been
incurred at the beginning of such four full fiscal quarters, would be greater
than 2.00 to 1 if such Indebtedness is Incurred on or before December 31, 1997
and 2.25 to 1 if such Indebtedness is Incurred after December 31, 1997; (ii)
Indebtedness of the Company, and guarantees of such Indebtedness by any
Guarantor, Incurred under the Senior Credit Facility in an aggregate principal
amount at any one time not to exceed the greater of (x) $187.5 million or (y)
the sum of (A) 80% of Eligible Accounts Receivable and (B) 65% of Eligible
Inventory; (iii) Indebtedness owed by the Company to any Wholly Owned Subsidiary
of the Company (provided that such Indebtedness is at all times held by a
--------
Person which is a Wholly Owned Subsidiary of the Company) or Indebtedness owed
by a Subsidiary of the Company to the Company or a Wholly Owned Subsidiary of
the Company (provided that such Indebtedness is at all times held by the Company
--------
or a Person which is a Wholly Owned Subsidiary of the Company); provided,
--------
however, upon either (x) the transfer or other disposition by such Wholly Owned
- -------
Subsidiary or the Company of any Indebtedness so permitted under this clause
(iii) to a Person other than the Company or another Wholly Owned Subsidiary of
the Company or (y) the issuance (other than directors' qualifying shares), sale,
transfer or other disposition of shares of Capital Stock or other ownership
interests (including by consolidation or merger) of such Wholly Owned Subsidiary
to a Person other than the Company or another such Wholly Owned Subsidiary of
the Company, the provisions of this clause (iii) shall no longer be applicable
to such Indebtedness and such Indebtedness shall be deemed to have been
Incurred at the time of any such issuance, sale, transfer or other disposition,
as the case may be; (iv) Indebtedness Incurred by a Person prior to the time
(x) such Person becomes a Subsidiary of the Company, (y) such Person merges into
or consolidates with a Subsidiary of the Company or (z) another Sub-
-69-
sidiary of the Company merges into or consolidates with such Person (in a
transaction in which such Person becomes a Subsidiary of the Company), which
Indebtedness was not Incurred in anticipation or contemplation of such
transaction and was outstanding prior to such transaction; (v) Indebtedness of
the Company or its Subsidiaries under any interest rate or currency swap
agreement to the extent entered into to hedge any other Indebtedness permitted
under this Indenture; (vi) Capital Lease Obligations of the Company or its
Subsidiaries Incurred with respect to a Sale and Leaseback Transaction which was
made in accordance with the provisions of Section 913; (vii) Indebtedness
Incurred to renew, extend, refinance or refund (collectively for purposes of
this clause (vii), to "refund") any Indebtedness outstanding on the Issue Date
and Indebtedness Incurred under the prior clause (i) or the Securities;
provided, however, that (x) such Indebtedness does not exceed the principal
- -------- -------
amount of Indebtedness so refunded plus the amount of any premium required to be
paid in connection with such refunding pursuant to the terms of the Indebtedness
refunded or the amount of any premium reasonably determined by the Company as
necessary to accomplish such refunding by means of a tender offer, exchange
offer or privately negotiated repurchase, plus the expenses of the Company or
such Subsidiary Incurred in connection therewith and (y)(A) in the case of any
refunding of Indebtedness which is pari passu with the Securities, such
---- -----
refunding Indebtedness is made pari passu with or subordinate in right of
---- -----
payment to the Securities, and, in the case of any refunding of Indebtedness
which is subordinate in right of payment to the Securities, such refunding
Indebtedness is subordinate in right of payment to the Securities on terms no
less favorable to the Holders than those contained in the Indebtedness being
refunded and (B) in either case, the refunding Indebted ness by its terms, or by
the terms of any agreement or instrument pursuant to which such Indebtedness is
issued, does not have an Average Life that is less than the remaining Average
Life of the Indebtedness being refunded and does not permit redemption or other
retirement (including pursuant to any required offer to purchase to be made by
the Company or a Subsidiary of the Company) of such Indebtedness at the option
of the holder thereof prior to the final stated maturity of the Indebtedness
being refunded, other than a redemption or other retirement at the option of the
holder of such Indebtedness (including pursuant to a required offer to purchase
made by the Company or a Subsidiary of the Company) which is conditioned upon a
change of control of the Company pursuant to provisions substantially similar to
those contained in Section 917; (viii) Indebtedness of the Company or its
Subsidiaries Incurred for the purpose of financing all or any part of the
purchase price or the cost of construction or improvement of any property,
provided that the aggregate principal amount of such Indebtedness does not
- --------
exceed 100% of such purchase price or cost and any Lien associated with such
Indebtedness complies with
-70-
clause (iv) of Section 912; (ix) Indebtedness of the Company or its Subsidiaries
not otherwise permitted to be Incurred pursuant to clauses (i) through (viii)
above which, together with any other outstanding Indebtedness Incurred pursuant
to this clause (ix), has an aggregate principal amount not in excess of $10
million at any time outstanding; and (x) Indebtedness of the Company and its
Subsidiaries under the Securities and the Guarantees.
(b) The Company will not, and the Company will not cause or
permit any Guarantor to, directly or indirectly, Incur any Indebtedness that
purports to be by its terms (or by the terms of any agreement governing such
Indebtedness) subordinated in right of payment to any other Indebtedness of the
Company or of such Guarantor, as the case may be, unless such Indebtedness is
also by its terms (or by the terms of any agreement governing such
Indebtedness) made expressly subordinated in right of payment to the Securities
or the Guarantee of such Guarantor, as the case may be, to the same extent and
in the same manner as such Indebtedness is subordinated to such other
Indebtedness of the Company or such Guarantor, as the case may be.
SECTION 909. Additional Limitation on Subsidiary
Indebtedness.
-----------------------------------
In addition to the restrictions on the Incurrence of Indebtedness set
forth in Section 908, the Company will not permit any of its Subsidiaries to
Incur any Indebtedness (other than the guarantee of Indebtedness under the
Senior Credit Facility and the 1995 Notes) in an amount which, when aggregated
with (A) all Indebtedness (other than any Indebtedness included in the following
clause (B) or (C)) secured by Liens permitted by the provisions of clause (viii)
of Section 912 and then outstanding, (B) all Capital Lease Obligations of the
Company and its Subsidiaries Incurred in compliance with the provisions of
Section 908 and then outstanding, and (C) all other Indebtedness of
Subsidiaries of the Company (other than the guarantee of Indebtedness under the
Senior Credit Facility and the 1995 Notes) Incurred in compliance with Section
908 and then outstanding, would exceed 10% of Consolidated Net Tangible Assets.
SECTION 910. Limitation on Restricted Payments.
---------------------------------
The Company will not, and will not permit any of its Subsidiaries to,
(i) directly or indirectly, declare or pay any dividend, or make any
distribution of any kind or character (whether in cash, property or securities),
in respect of any class of its Capital Stock or to the holders thereof,
excluding any (x) dividends or distributions payable solely in shares of its
Capital Stock (other than Disqualified Stock) or in options, warrants or other
rights to acquire its Capital Stock
-71-
(other than Disqualified Stock), or (y) in the case of any Subsidiary of the
Company, dividends or distributions payable to the Company or a Subsidiary of
the Company, (ii) directly or indirectly, purchase, redeem or otherwise acquire
or retire for value shares of Capital Stock of the Company or any of its
Subsidiaries, any options, warrants or rights to purchase or acquire shares of
Capital Stock of the Company or any of its Subsidiaries or any securities
convertible or exchangeable into shares of Capital Stock of the Company or any
of its Subsidiaries, excluding any such shares of Capital Stock, options,
warrants, rights or securities which are owned by the Company or a Subsidiary of
the Company, (iii) make any Investment in (other than a Permitted Investment),
or payment on a guarantee of any obligation of, any Person, other than the
Company or a Wholly Owned Subsidiary of the Company, or (iv) redeem, defease,
repurchase, retire or otherwise acquire or retire for value, prior to any
scheduled maturity, repayment or sinking fund payment, Indebtedness which is
subordinate in right of payment to the Securities (each of clauses (i) through
(iv) being a "Restricted Payment") if at the time thereof:
(1) an Event of Default, or a Default, shall have occurred and be
continuing, or
(2) upon giving effect to such Restricted Payment, the Company could
not Incur at least $1.00 of additional Indebtedness pursuant to clause (i)
of Section 908, or
(3) upon giving effect to such Restricted Payment, the aggregate of
all Restricted Payments made after March 23, 1995 exceeds the sum of:
(a) 50% of cumulative Consolidated Net Income of the Company (or,
in the case Consolidated Net Income of the Company shall be negative,
less 100% of such deficit) since April 1, 1995 through the last day of
the fiscal quarter for which financial statements are available; plus
(b) 100% of the aggregate net proceeds received after March 23,
1995, including the fair market value of property other than cash
(determined in good faith by the Board of Directors of the Company as
evidenced by a resolution of such Board of Directors filed with the
Trustee), from the issuance of Capital Stock (other than Disqualified
Stock) of the Company and warrants, rights or options on Capital Stock
(other than Disqualified Stock) of the Company and the principal
amount of Indebtedness that has been converted into or exchanged for
Capital Stock (other than Disqualified Stock) of the Company which
Indebtedness was Incurred after the Issue Date; plus
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(c) in the case of the disposition or repayment of any Investment
constituting a Restricted Payment made after March 23, 1995 (other
than any Investment made pursuant to clause (vi) of the following
paragraph), an amount equal to the lesser of the return of capital
with respect to such Investment and the cost of such Investment, in
either case, less the cost of the disposition of such Investment,
provided that at the time any such Investment is made the Company
--------
delivers to the Trustee a resolution of its Board of Directors to the
effect that, for purposes of this Section, such Investment constitutes
a Restricted Payment made after the Issue Date (other than an
Investment made pursuant to clause (vi) of the following paragraph);
plus
(d) $4 million.
The foregoing provision will not be violated by (i) reason of any
dividend on any class of the Capital Stock of the Company or any Subsidiary of
the Company paid within 60 days after the declaration thereof if, on the date
when the dividend was declared, the Company or such Subsidiary, as the case may
be, could have paid such dividend in accordance with the provisions of this
Indenture, (ii) the renewal, extension, refunding or refinancing of any
Indebtedness otherwise permitted pursuant to clause (vii) of Section 908, (iii)
the exchange or conversion of any Indebtedness of the Company or any Subsidiary
of the Company for or into Capital Stock of the Company (other than Disqualified
Stock of the Company), (iv) any payments, loans or other advances made pursuant
to any employee benefit plans (including plans for the benefit of directors) or
employment agreements or other compensation arrangements, in each case as
approved by the Board of Directors of the Company in its good faith judgment
evidenced by a resolution of such Board of Directors filed with the Trustee, (v)
the redemption of the Company's rights issued pursuant to the Rights Agreement
dated as of March 20, 1990, between the Company and Sovran Bank, N.A., as Rights
Agent, as in existence on the Issue Date or (vi) so long as no Default or Event
of Default has occurred and is continuing, additional Investments constituting
Restricted Payments in an aggregate outstanding amount (valued at the cost
thereof) not to exceed at any time 5% of Consolidated Net Tangible Assets. Each
Restricted Payment described in clauses (i), (iv) and (v) of the previous
sentence shall be taken into account for purposes of computing the aggregate
amount of all Restricted Payments pursuant to clause (3) of the first paragraph
of this Section.
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SECTION 911. Limitations Concerning Distributions and Transfers by
-----------------------------------------------------
Subsidiaries.
------------
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist any
consensual encumbrance or restriction on the ability of any Subsidiary of the
Company (i) to pay, directly or indirectly, dividends or make any other dis-
tributions in respect of its Capital Stock or pay any Indebtedness or other
obligation owed to the Company or any Subsidiary of the Company, (ii) to make
loans or advances to the Company or any Subsidiary of the Company or (iii) to
transfer any of its property or assets to the Company or any Subsidiary of the
Company except for such encumbrances or restrictions existing under or by reason
of (a) any agreement in effect on the Issue Date, (b) an agreement relating to
any Indebtedness Incurred by such Subsidiary prior to the date on which such
Subsidiary was acquired by the Company and outstanding on such date and not
Incurred in anticipation or contemplation of becoming a Subsidiary and provided
such encumbrance or restriction shall not apply to any assets of the Company or
its Subsidiaries other than such Subsidiary, (c) customary provisions contained
in an agreement which has been entered into for the sale or disposition of all
or substantially all of the Capital Stock or assets of such Subsidiary, or (d)
an agreement effecting a renewal, exchange, refunding or extension of
Indebtedness Incurred pursuant to an agreement referred to in clause (a) or (b)
above; provided, however, that the provisions contained in such renewal,
-------- -------
exchange, refunding or extension agreement relating to such encumbrance or
restriction are no more restrictive in any material respect than the provisions
contained in the agreement the subject thereof in the reasonable judgment of the
Board of Directors of the Company as evidenced by a resolution of such Board of
Directors filed with the Trustee.
SECTION 912. Limitation on Liens.
-------------------
The Company will not, and will not permit any of its Subsidiaries to,
Incur any Lien on or with respect to any property or assets of the Company or
any Subsidiary of the Company owned on the Issue Date or thereafter acquired to
secure Indebtedness without making, or causing such Subsidiary to make,
effective provision for securing the Securities (and, if the Company shall so
determine, any other Indebtedness of the Company or such Subsidiary, including
Indebtedness which is subordinate in right of payment to the Securities,
provided that Liens securing the Securities and any Indebtedness pari passu with
- -------- ---- -----
the Securities are senior to such Liens securing such subordinated
Indebtedness) equally and ratably with such Indebtedness or, in the event such
Indebtedness is subordinate in right of payment to the Securities, prior to such
Indebtedness, as to
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such property or assets for so long as such Indebtedness shall be so secured.
The foregoing restrictions shall not apply to (i) Liens in
respect of Indebtedness existing on the Issue Date; (ii) Liens securing only the
Securities; (iii) Liens in favor of the Company; (iv) Liens to secure
Indebtedness Incurred for the purpose of financing all or any part of the pur-
chase price or the cost of construction or improvement of the property subject
to such Liens; provided that (a) the aggregate principal amount of any
--------
Indebtedness secured by such a Lien does not exceed 100% of such purchase price
or cost, (b) such Lien does not extend to or cover any other property other than
such item of property and any improvements on such item, (c) the Indebtedness
secured by such Lien is Incurred by the Company or its Subsidiary within 180
days of the acquisition, construction or improvement of such property and (d)
the Incurrence of such Indebtedness is permitted by Sections 908 and 909; (v)
Liens on property existing immediately prior to the time of acquisition thereof
(and not created in anticipation or contemplation of the financing of such
acquisition); (vi) Liens on property of a Person existing at the time such
Person is merged with or into or consolidated with the Company or any Subsidiary
of the Company (and not created in anticipation or contemplation thereof); (vii)
Liens on property of the Company or any Subsidiary of the Company in favor of
the United States of America, any state thereof or any instrumentality of either
to secure payments pursuant to any contract or statute; (viii) Liens securing an
aggregate principal amount of Indebtedness at any one time outstanding which,
when taken together with (A) all Capital Lease Obligations of the Company and
its Subsidiaries Incurred in compliance with Sections 908 and 909 and then
outstanding and (B) all other Indebtedness of Subsidiaries of the Company
(other than the guarantee of Indebtedness under the Senior Credit Facility and
the 1995 Notes) Incurred in compliance with Sections 908 and 909 and then
outstanding, would not exceed 10% of Consolidated Net Tangible Assets; and (ix)
Liens to secure Indebtedness Incurred to extend, renew, refinance or refund (or
successive extensions, renewals, refinancings or refundings), in whole or in
part, any Indebtedness secured by Liens referred to in the foregoing clause (i)
so long as such Lien does not extend to any other property and the principal
amount of Indebtedness so secured is not increased except for the amount of any
premium required to be paid in connection with such refinancing pursuant to the
terms of the Indebtedness refinanced or the amount of any premium reasonably
determined by the Company as necessary to accomplish such refinancing by means
of a tender offer, exchange offer or privately negotiated repurchase, plus the
expenses of the Company or such Subsidiary Incurred in connection with such
refinancing.
-75-
SECTION 913. Limitation on Sale and Leaseback
Transactions.
--------------------------------
The Company will not, and will not permit any of its Subsidiaries to,
enter into any Sale and Leaseback Transaction (except for a period not exceeding
30 months) unless the Company or such Subsidiary applies the net proceeds of
the property sold pursuant to the Sale and Leaseback Transaction as if such net
proceeds were Net Available Proceeds subject to disposition as provided in
Section 916.
SECTION 914. Limitation on Issuance and Sale of
Capital Stock of Subsidiaries.
----------------------------------
The Company (a) will not, and will not permit any Subsidiary of the
Company to, transfer, convey, sell or other wise dispose of any shares of
Capital Stock of such Subsidiary or any other Subsidiary (other than to the
Company or a Wholly Owned Subsidiary of the Company) except that the Company and
any Subsidiary may, in any single transaction, sell all, but not less than all,
of the issued and outstanding Capital Stock of any Subsidiary to any Person,
subject to complying with the provisions of Section 916, and (b) will not permit
any Subsidiary of the Company to issue shares of its Capital Stock (other than
directors' qualifying shares), or securities convertible into, or warrants,
rights or options to subscribe for or purchase shares of, its Capital Stock to
any Person other than to the Company or a Wholly Owned Subsidiary of the
Company.
SECTION 915. Transactions with Affiliates and Related
Persons.
----------------------------------------
The Company will not, and will not permit any of its Subsidiaries to,
enter into any transaction with an Affiliate or Related Person of the Company
(other than the Company or a Subsidiary of the Company), including, without
limitation, the purchase, sale, lease or exchange of property, the rendering of
any service, or the making of any guarantee, loan, advance or Investment, either
directly or indirectly, involving aggregate consideration in excess of $500,000,
unless (i) a majority of the disinterested directors of the Board of Directors
of the Company determines, in its good faith judgment evidenced by a resolution
of such Board of Directors filed with the Trustee, that such transaction is in
the best interests of the Company or such Subsidiary, as the case may be; and
(ii) such transaction is, in the opinion of a majority of the disinterested di-
rectors of the Board of Directors of the Company evidenced by a resolution of
such Board of Directors filed with the Trustee, on terms no less favorable to
the Company or such Subsidiary, as the case may be, than those that could be
obtained in a comparable arm's length transaction with an entity that is not an
Affiliate or a Related Person.
-76-
SECTION 916. Limitation on Certain Asset Dispositions.
----------------------------------------
(a) The Company will not, and will not permit any of its Subsidiaries
to, make one or more Asset Dispositions for aggregate consideration of, or in
respect of assets having an aggregate fair market value of, $5 million or more
in any 12-month period, unless:
(i) the Company or the Subsidiary, as the case may be, receives
consideration for such Asset Disposition at least equal to the fair market
value of the assets sold or disposed of as determined by the Board of
Directors of the Company in good faith and evidenced by a resolution of such
Board of Directors filed with the Trustee;
(ii) not less than 75% of the consideration for the disposition
consists of cash or readily marketable cash equivalents or the assumption of
Indebtedness of the Company or such Subsidiary or other obligations relating
to such assets (and release of the Company or such Subsidiary from all
liability on the Indebtedness or other obligations assumed); and
(iii) all Net Available Proceeds, less any amounts invested within 360
days of such Asset Disposition in assets related to the business of the
Company (including the Capital Stock of another Person (other than the
Company or any Person that is a Subsidiary of the Company immediately prior
to such investment), provided that immediately after giving effect to any
--------
such investment (and not prior thereto) such Person shall be a Subsidiary of
the Company), are applied either (A) to an Offer to Purchase outstanding
Securities at 100% of their principal amount plus accrued interest to the
Purchase Date or (B) to the permanent reduction and repayment of
Indebtedness then out standing under the Senior Credit Facility, to the
repayment of other Indebtedness that is not subordinated in right of payment
to the Securities and to the purchase of Securities pursuant to an Offer to
Purchase outstanding Securities at 100% of their principal amount plus
accrued interest to the Purchase Date, provided that (x) any Net Available
--------
Proceeds not applied to the repayment of Indebtedness under the Senior
Credit Facility or other Indebtedness not subordinated in right of payment
to the Securities in accordance with subclause (B) of this clause
(iii) shall be added to the Net Available Proceeds to be used for an Offer
to Purchase outstanding Securities and (y) the Company may defer making any
Offer to Purchase out standing Securities until there are aggregate
unutilized Net Available Proceeds equal to or in excess of $5 million
resulting from one or more Asset Dispositions (at which time, the entire
unutilized Net Available Proceeds, and
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not just the amount in excess of $5 million, shall be applied as
required pursuant to this paragraph).
Any repayment of Indebtedness in accordance with the foregoing subclause (B) of
clause (iii) shall be made pro rata, based on the principal amount (or, in the
--------
case of Indebtedness having unamortized discount, the accreted value thereof) of
such Indebtedness outstanding. Any remaining Net Available Proceeds following
the completion of the Offer to Purchase may be used by the Company for any other
purpose (subject to the other provisions of this Indenture) and the amount of
Net Available Proceeds then required to be otherwise applied in accordance with
this Section shall be reset to zero, subject to any subsequent Asset
Disposition.
In the event that the Company makes an Offer to Purchase the
Securities, the Company intends to comply with any applicable securities laws
and regulations, including any applicable requirements of Section 14(e) of, and
Rule 14e-1 under, the Exchange Act, and any violation of the provisions of this
Indenture relating to such Offer to Purchase occurring as a result of such
compliance shall not be deemed an Event of Default or a Default.
(b) The Company will mail the Offer for an Offer to Purchase required
pursuant to Section 915(a) not more than 365 days after consummation of the
Asset Disposition resulting in the Offer to Purchase. Each Holder shall be
entitled to tender all or any portion of the Securities owned by such Holder
pursuant to the Offer to Purchase, subject to the requirement that any portion
of a Security tendered must be tendered in an integral multiple of $1,000
principal amount and subject to any proration of the Offer among tendering
Holders if the aggregate amount of Securities tendered exceeds the Net Available
Proceeds.
(c) Not later than the date of the Offer with respect to an Offer to
Purchase pursuant to this Section 915, the Company shall deliver to the Trustee
an Officers' Certificate as to the Purchase Amount.
On or prior to the Purchase Date specified in the Offer to Purchase,
the Company shall (i) accept for payment (on a pro rata basis, if necessary)
Securities or portions thereof validly tendered pursuant to the Offer, (ii)
deposit with the Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 903) money sufficient
to pay the Purchase Price of all Securities or portions thereof so accepted and
(iii) deliver or cause to be delivered to the Trustee all Securities so accepted
together with an Officers' Certificate stating the Securities or portions
thereof accepted for payment by the Company. The Paying
-78-
Agent (or the Company, if so acting) shall promptly mail or deliver to Holders
of Securities so accepted payment in an amount equal to the Purchase Price for
such Securities, and the Trustee shall promptly authenticate and mail or
deliver to each Holder a new Security or Securities equal in principal amount to
any unpurchased portion of the Security surrendered as requested by the Holder.
Any Security not accepted for payment shall be promptly mailed or delivered by
the Company to the Holder thereof. The Company shall publicly announce the re-
sults of the Offer on or as soon as practicable after the Purchase Date.
(d) Notwithstanding the foregoing, this Section 916 shall not
apply to any Asset Disposition consummated in compliance with the provisions of
Section 701 or 913 (with respect to an asset leased for a period not exceeding
30 months pursuant to a Sale and Leaseback Transaction).
SECTION 917. Change of Control.
-----------------
(a) The Company shall, within 30 days following the date of
the consummation of a transaction resulting in a Change of Control, mail an
Offer with respect to an Offer to Purchase all outstanding Securities at a
purchase price equal to 101% of their aggregate principal amount plus accrued
interest to the Purchase Date. Each Holder shall be entitled to tender all or
any portion of the Securities owned by such Holder pursuant to the Offer to
Purchase, subject to the requirement that any portion of a Security tendered
must be tendered in an integral multiple of $1,000 principal amount.
(b) On or prior to the Purchase Date specified in the Offer to
Purchase, the Company shall (i) accept for payment all Securities or portions
thereof validly tendered pursuant to the Offer, (ii) deposit with the Paying
Agent (or, if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 903) money sufficient to pay the Purchase Price
of all Securities or portions thereof so accepted and (iii) deliver or cause to
be delivered to the Trustee all Securities so accepted together with an
Officers' Certificate stating the Securities or portions thereof accepted for
payment by the Company. The Paying Agent (or the Company, if so acting) shall
promptly mail or deliver to Holders of Securities so accepted payment in an
amount equal to the Purchase Price for such Securities, and the Trustee shall
promptly authenticate and mail or deliver to each Holder a new Security or
Securities equal in principal amount to any unpurchased portion of the Security
surrendered as requested by the Holder. Any Security not accepted for payment
shall be promptly mailed or delivered by the Company to the Holder thereof. The
Company shall publicly announce the results of the Offer on or as soon as
practicable after the Purchase Date.
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(c) A "Change of Control" will be deemed to have occurred in the
event that (whether or not otherwise permitted by this Indenture) after the
Issue Date (a) any Person or any Persons acting together that would constitute
a "group" (for purposes of Section 13(d) of the Exchange Act, or any successor
provision thereto) (a "Group"), together with any Affiliates or Related Persons
thereof, shall beneficially own (as defined in Rule 13d-3 under the Exchange
Act, or any successor provision thereto) at least 40% of the Voting Stock of the
Company; (b) any sale, lease or other transfer (in one transaction or a series
of related transactions) by the Company or any of its Subsidiaries of all or
substantially all of the consolidated assets of the Company to any Person
(other than a Wholly Owned Subsidiary of the Company); (c) Continuing Directors
cease to constitute at least a majority of the Board of Directors of the
Company; or (d) the stockholders of the Company approve any plan or proposal for
the liquidation or dissolution of the Company.
In the event that the Company makes an Offer to Purchase the
Securities, the Company intends to comply with any applicable securities laws
and regulations, including any applicable requirements of Section 14(e) of, and
Rule 14e-1 under, the Exchange Act and any violation of the provisions of this
Indenture relating to such Offer to Purchase occurring as a result of such
compliance shall not be deemed a Default or an Event of Default.
SECTION 918. Provision of Financial Information.
----------------------------------
Whether or not the Company is subject to Section 13(a) or
15(d) of the Exchange Act, or any successor provision thereto, the Company will
file with the 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) or any successor provision
thereto if the Company were so required, 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 required. The Company will also in any event (a) within 15 days
of each Required Filing Date (i) transmit by mail to all Holders, as their names
and addresses appear in the Security Register, without cost to such Holders, and
(ii) file with the Trustee, copies of the annual reports, quarterly reports and
other documents which the Company is required to file with the Commission
pursuant to the preceding sentence, and (b) if, notwithstanding the preceding
sentence, filing such documents by the Company with the Commission is not
permitted under the Exchange Act, promptly upon written request supply copies
of such documents to any prospective Holder. The Company will also comply with
Section 314(a) of the Trust Indenture Act.
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SECTION 919. Statement by Officers as to Default; Compliance Certificates.
-------------------------------------------------------------
(a) The Company will deliver to the Trustee, within 90 days
after the end of each fiscal year of the Company ending after the Issue Date, an
Officers' Certificate stating that a review of the activities of the Company and
its Subsidiaries has been made under the supervision of the signing officers
with a view to determining whether the Company and each of the Guarantors has
kept, observed, performed and fulfilled its obligations under this Indenture,
and further stating, as to each such officer signing such certificate, that, to
the best of his knowledge, the Company and each of the Guarantors have kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and there is not existing any Default or Event of Default (or, if a
Default or Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he may have knowledge and what action the Company
and each of the Guarantors are taking or propose to take with respect thereto).
For purposes of this paragraph, such compliance shall be determined without
regard to any period of grace or requirement of notice. The first certificate to
be delivered by the Company pursuant to this Section 919 shall be for the fiscal
year ending on or about the end of December 1997.
(b) The Company shall deliver to the Trustee, as soon as
possible after the Company becomes aware of the occurrence of a Default or
Event of Default, an Officers' Certificate setting forth the details of such
Default or Event of Default, and the action which the Company and the
Guarantors propose to take with respect thereto.
(c) So long as (and to the extent) not contrary to the then
current recommendations of the American Institute of Certified Public
Accountants, the Company shall deliver to the Trustee within 90 days after the
end of each fiscal year a written statement by the Company's independent public
accountants stating (A) that their audit examination has included a review of
the terms of this Indenture, the Securities and the Guarantees as they relate to
accounting matters, and (B) whether, in connection with their audit examination,
any Default or Event of Default has come to their attention and, if such a
Default or Event of Default has come to their attention, specifying the nature
and period of the existence thereof.
SECTION 920. Special Covenants of the Guarantors.
-----------------------------------
Each Guarantor of the Securities issued under this Indenture will
comply with each of the covenants contained in this Indenture that impose
restrictions or obligations on such Guarantor (by virtue of being a Guarantor or
otherwise) not-
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withstanding that the text of such covenant is worded as a restriction on or
obligation of the Company.
ARTICLE TEN
Redemption of Securities
SECTION 1001. Right of Redemption.
-------------------
The Securities may be redeemed at the election of the Company, as a
whole or from time to time in part, at the times and at the Redemption Prices
specified in the form of Security set forth in Exhibit A together with any
applicable accrued interest to the Redemption Date.
SECTION 1002. Applicability of Article.
------------------------
Redemption of Securities at the election of the Company, as permitted
by any provision of this Indenture, shall be made in accordance with such
provision and this Article.
SECTION 1003. Election To Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Securities pursuant to
Section 1001 shall be evidenced by a Board Resolution of the Company delivered
to the Trustee. In case of any redemption at the election of the Company of less
than all the Securities, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities to be redeemed.
SECTION 1004. Selection by Trustee of Securities To Be Redeemed.
-------------------------------------------------
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from all outstanding Securities not previously
called for redemption, by such method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $1,000 or any integral multiple thereof) of the principal amount of
Securities of a denomination larger than $1,000.
The Trustee shall promptly notify the Company and the 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.
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For all purposes of this Indenture, all provisions relating to the
redemption of Securities shall relate, in the case of any Securities redeemed or
to be redeemed only in part, to the portion of the principal amount of such
Securities which has been or is to be redeemed.
SECTION 1005. 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 his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the outstanding Securities are to be redeemed,
the identification (and, in the case of partial redemption, the principal
amounts) of the particular Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and that, unless the
Company shall default in the payment of the Redemption Price and any
applicable accrued interest, interest thereon will cease to accrue on and
after said date, and
(5) the place or places where such Securities are to be surrendered
for payment of the Redemption Price.
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 request, by the
Trustee in the name and at the expense of the Company.
SECTION 1006. Deposit of Redemption Price.
---------------------------
On or prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 903) an amount of
money sufficient to pay the Redemption Price of and accrued interest on all the
Securities which are to be redeemed on that date.
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SECTION 1007. 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 default in the payment of the Redemption Price and any
applicable 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 Paying Agent at the Redemption Price,
together with any applicable accrued interest to the Redemption Date.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any) and
accrued interest on such unpaid principal shall, until paid, bear interest from
the Redemption Date at the rate provided by the Security.
SECTION 1008. Securities Redeemed in Part.
---------------------------
Upon surrender of a Security that is redeemed in part (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 his attorney duly authorized in writing), the Company
shall execute, the Guarantors shall execute the Guarantee endorsed upon, 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.
ARTICLE ELEVEN
Guarantee
SECTION 1101. Unconditional Guarantee.
-----------------------
Each Guarantor hereby unconditionally, jointly and severally,
guarantees (such guarantee to be referred to herein as the "Guarantee") to each
Holder of a Security authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns that: the principal of, premium, if any,
and interest on the Securities will be promptly paid in full when due, subject
to any applicable grace period, whether at maturity, by acceleration or
otherwise, and interest on the overdue principal and premium, if any, Additional
Interest, if any, and interest on any overdue interest of the Securities and all
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other obligations of the Company to the Holders or the Trustee hereunder or
under the Securities will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; subject, however, to the
limitations set forth in Section 1104. Each Guarantor hereby agrees that its
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or this Indenture, the absence
of any action to enforce the same, any waiver or consent by any Holder of the
Securities with respect to any provisions hereof or thereof, the recovery of any
judgment against the Company, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a guarantor. Each Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenants that the
Guarantee will not be discharged except by complete performance of the
obligations contained in the Securities, this Indenture, and this Guarantee. If
any Holder or the Trustee is required by any court or otherwise to return to the
Company, any Guarantor, or any custodian, trustee, liquidator or other similar
official acting in relation to the Company or any Guarantor, any amount paid by
the Company or any Guarantor to the Trustee or such Holder, this Guarantee, to
the extent theretofore discharged, shall be reinstated in full force and
effect. Each Guarantor further agrees that, as between each Guarantor, on the
one hand, and the Holders and the Trustee, on the other hand, (x) the maturity
of the obligations guaranteed hereby may be accelerated as provided in Article
Four for the purpose of this Guarantee, notwithstanding any stay, injunction or
other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (y) in the event of any acceleration of such obligations
as provided in Article Four, such obligations (whether or not due and payable)
shall forthwith become due and payable by each Guarantor for the purpose of this
Guarantee.
SECTION 1102. Severability.
------------
In case any provision of this Guarantee shall be in valid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1103. Release of a Guarantor.
----------------------
If the Securities are defeased in accordance with the terms of
this Indenture, or if all or substantially all of the assets of any Guarantor or
all of the capital stock of any Guarantor is sold (including by issuance or
otherwise) by the Company or any of its Subsidiaries in a transaction constitut-
-85-
ing an Asset Disposition, and if (x) the Net Available Proceeds from such Asset
Disposition are used in accordance with Section 916 or (y) the Company delivers
to the Trustee an Officers' Certificate covenanting that the Net Available
Proceeds from such Asset Disposition shall be used in accordance with Section
916 and within the time limits specified by such Section 916, then such
Guarantor (in the event of a sale or other disposition of all of the capital
stock of such Guarantor) or the corporation acquiring such assets (in the event
of a sale or other disposition of all or substantially all of the assets of such
Guarantor), shall be released and discharged from its obligations under this
Article Eleven without any further action required on the part of the Trustee
or any Holder. The Trustee shall, at the sole cost and expense of the Company
and upon receipt at the reasonable request of the Trustee of an Opinion of
Counsel that the provisions of this Section 1103 have been complied with,
deliver an appropriate instrument evidencing such release upon receipt of a
request by the Company accompanied by an Officers' Certificate certifying as to
the compliance with this Section. Any Guarantor not so released remains liable
for the full amount of principal of, premium, if any, and interest on the
Securities and the other obligations of the Company hereunder as provided in
this Article Eleven.
SECTION 1104. Limitation of Guarantor's Liability.
-----------------------------------
Each Guarantor, and by its acceptance hereof each Holder and
the Trustee, hereby confirms that it is the intention of all such parties that
the guarantee by such Guarantor pursuant to its Guarantee not constitute a
fraudulent transfer or conveyance for purposes of title 11 of the United States
Code, as amended, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar U.S. Federal or state or other applicable law. To
effectuate the foregoing intention, the Holders and such Guarantor hereby
irrevocably agree that the obligations of such Guarantor under the Guarantee
shall be limited to the maximum amount which, after giving effect to all other
contingent and fixed liabilities of such Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or
pursuant to Section 1105, will result in the obligations of such Guarantor under
the Guarantee not constituting a fraudulent transfer or conveyance.
SECTION 1105. Contribution.
------------
In order to provide for just and equitable contribution among
the Guarantors, the Guarantors agree, inter se, that in the event any payment or
--------
distribution is made by any Guarantor (a "Funding Guarantor") under the
Guarantee, such Funding Guarantor shall be entitled to a contribution from all
other
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Guarantors in a pro rata amount, based on the net assets of each Guarantor
--- ----
(including the Funding Guarantor), determined in accordance with GAAP, subject
to Section 1104, for all payments, damages and expenses incurred by that
Funding Guarantor in discharging the Company's obligations with respect to the
Securities or any other Guarantor's obligations with respect to the Guarantee.
SECTION 1106. Execution of Guarantee.
----------------------
To further evidence their Guarantee to the Holders, the Guarantors
hereby agree to execute the Guarantee in substantially the form set forth in
Exhibit A-1 to be endorsed on each Security ordered to be authenticated and
delivered by the Trustee. Each Guarantor hereby agrees that its Guarantee set
forth in Section 1101 shall remain in full force and effect notwithstanding any
failure to endorse on each Security a notation of such Guarantee. Each such
Guarantee shall be signed on behalf of each Guarantor by its Chairman of the
Board, its President or one of its Vice Presidents prior to the authentication
of the Security on which it is endorsed, and the delivery of such Security by
the Trustee, after the authentication thereof hereunder, shall constitute due
delivery of such Guarantee on behalf of such Guarantor. Such signature upon the
Guarantee may be manual or facsimile signature of such officer and may be
imprinted or otherwise reproduced on the Guarantee, and in case such officer who
shall have signed the Guarantee shall cease to be such officer before the
Security on which such Guarantee is endorsed shall have been authenticated and
delivered by the Trustee or disposed of by the Company, such Security
nevertheless may be authenticated and delivered or disposed of as though the
Person who signed the Guarantee had not ceased to be such officer of the
Guarantor.
SECTION 1107. Additional Guarantors.
---------------------
The Company shall cause each Material Subsidiary, whether formed or
acquired after the Issue Date, to execute and deliver to the Trustee, promptly
upon any such formation or acquisition (a) a supplemental indenture in form and
substance satisfactory to the Trustee which subjects such Material Subsidiary
to the provisions of this Indenture as a Guarantor, and (b) an Opinion of
Counsel to the effect that such supplemental indenture has been duly authorized
and executed by such Material Subsidiary and constitutes the legal, valid,
binding and enforceable obligation of such Material Subsidiary (subject to such
customary exceptions concerning fraudulent conveyance laws, creditors' rights
and equitable principles as may be acceptable to the Trustee in its discretion),
provided that any Material Subsidiary acquired after the Issue Date which is
- --------
prohibited from entering into a Guarantee pursuant to restrictions contained in
any debt instrument or other agreement in exis-
-87-
tence at the time such Material Subsidiary was so acquired and not entered into
in anticipation or contemplation of such acquisition shall not be required to
comply with the foregoing provisions of this Section so long as any such
restriction is in existence and to the extent of any such restriction.
SECTION 1108. Subordination of Subrogation and Other
Rights.
--------------------------------------
Each Guarantor hereby agrees that any claim against the Company that
arises from the payment, performance or enforcement of such Guarantor's
obligations under its Guarantee or this Indenture, including, without
limitation, any right of subrogation, shall be subject and subordinate to, and
no payment with respect to any such claim of such Guarantor shall be made
before, the payment in full of all outstanding Securities in accordance with the
provisions provided therefor in this Indenture.
ARTICLE TWELVE
Defeasance and Covenant Defeasance
SECTION 1201. Defeasance and Covenant Defeasance.
----------------------------------
(a) The Company may, at its option and at any time, elect to have the
respective obligations of the Company and the Guarantors discharged with respect
to the outstanding Securities and the Guarantees (a "defeasance") by fulfilling
the applicable conditions of Section 1201(b). Such defeasance means that the
Company shall be deemed to have paid and discharged the entire Indebtedness
represented by the outstanding Securities, and the Company and the Guarantors
shall be deemed to have satisfied all their respective other obligations under
the Securities, the Guarantees and this Indenture (and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the
same), except for the following, which shall survive unless otherwise terminated
or discharged hereunder: (i) the rights of Holders of outstanding Securities to
receive, solely from the trust fund described in Sections 1201(b) and 1202,
payments in respect of the principal of, premium, if any, and interest on such
Securities when such payments are due, (ii) the Company's and the Guarantors'
respective obligations with respect to the Securities concerning issuing
temporary Securities (Section 208), registration of transfer or exchange of
Securities (Section 206), mutilated, destroyed, lost or stolen Securities
(Section 207) and the maintenance of an office or agency for payment (Section
902) and money for security payments held in trust (Section 903), (iii) the
rights, powers, trusts, duties and immunities of the Trustee set forth in Arti-
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cles Five and Six and (iv) the defeasance provisions of this Article Twelve. In
addition, the Company may, at its option and at any time, elect to have the
respective obligations of the Company and the Guarantors released with respect
to any covenants contained in Sections 701, 904, 905, 906, 907, 908, 909, 910,
911, 912, 913, 914, 915, 916, 917 and 918 (a "covenant defeasance") by
fulfilling the applicable provisions of Section 1201(b) and such Securities
shall thereafter be deemed not to be outstanding for the purposes of any
direction, waiver, consent, declaration or any other act or action of the
Holders (and the consequences of any thereof) taken or to be taken in connection
with any of such covenants, but shall continue to be deemed outstanding for all
other purposes hereunder. For this purpose such covenant defeasance means with
re spect to such outstanding Securities that the Company and the Guarantors 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 by reason of reference
in any such Section to any other provision herein or in any other document, and
such omission to comply with any such term, condition or limitation shall not
constitute a Default or an Event of Default with respect to the Securities. In
the event covenant defeasance occurs, the events described in clauses (4) and
(5) (as it applies to the covenants listed in the foregoing sentence) of Section
401 shall no longer constitute Events of Default with respect to the Securities.
Except as specified above, the remainder of this Indenture, the Securities and
the Guarantees shall be unaffected by such covenant defeasance.
(b) The following shall be the conditions to application
of this Section 1201:
(i) the Company shall have deposited or caused to be
deposited irrevocably with the Trustee as trust funds, in trust for the
benefit of the Holders of the Securities, cash in U.S. dollars,
non-callable United States Government Obligations, or a combination
thereof, in an amount sufficient without reinvestment of any interest
received on such funds, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay the principal of (premium, if
any) and each installment of interest on the outstanding Securities on
the Stated Maturity (including upon redemption) of such principal or
installment of interest;
(ii) in the case of defeasance, the Company shall have
delivered to the Trustee an Opinion of Counsel in the United States
stating 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
-89-
tax law, in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm 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 defea sance had not
occurred;
(iii) in the case of covenant defeasance, the Company shall
have delivered to the Trustee an Opinion of 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;
(iv) no Default or Event of Default shall have occurred and
be continuing on the date of such deposit;
(v) such defeasance or covenant defeasance shall not result
in a breach or violation of, or constitute a default under, this
Indenture or any other agreement or instrument to which the Company or
any Guarantor is a party or by which it is bound;
(vi) in the case of defeasance or covenant defeasance the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that after the 91st day (or such other applicable date)
following the deposit, the trust funds will not be subject to the
effect of any applicable bankruptcy, insolvency, reorganization or
similar law affecting creditors' rights generally and that such
defeasance or covenant defeasance will not result in the Trustee or the
trust arising from such deposit constituting an Investment Company as
defined in the Investment Company Act of 1940, as amended; and
(vii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance or
the covenant defeasance, as the case may be, have been complied with.
(c) Notwithstanding defeasance or covenant defeasance in
accordance with this Section 1201, the obligations of the Trustee under Section
1202 shall survive.
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SECTION 1202. Application of Trust Money.
--------------------------
Subject to Section 903, the Trustee shall hold in trust all money or
United States Government Obligations deposited with it pursuant to Section
1201, and shall apply the deposited money and the money from United States
Government Obligations in accordance with this Indenture to the payment of
principal of, premium, if any, and interest on the Securities.
SECTION 1203. Reinstatement.
-------------
If the Trustee is unable to apply any money or United States
Government Obligations in accordance with Section 1201 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's and the Guarantors' respective obligations under this Indenture, the
Securities and the Guarantees shall be revived and reinstated as though no
deposit had occurred pursuant to Section 1201 until such time as the Trustee is
permitted to apply all such money or United States Government Obligations in
accordance with Section 1201; provided that if the Company has made any payment
--------
of interest or premium on or principal of any Securities because of the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the money or
United States Government Obligations held by the Trustee.
---------------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the day and year first above written.
TULTEX CORPORATION
By:
----------------------------
Name:
Title:
AKOM, LTD.
By:
----------------------------
Name:
Title:
DOMINION STORES, INC.
By:
----------------------------
Name:
Title:
LOGOATHLETIC, INC.
By:
----------------------------
Name:
Title:
LOGOATHLETIC/HEADWEAR, INC.
By:
----------------------------
Name:
Title:
SWEATJET INCORPORATED
By:
----------------------------
Name:
Title:
-92-
TULTEX CANADA, INC.
By:
----------------------------
Name:
Title:
TULTEX INTERNATIONAL, INC.
By:
----------------------------
Name:
Title:
FIRST UNION NATIONAL BANK OF
VIRGINIA, as Trustee
By:
----------------------------
Name:
Title:
EXHIBIT A
(FORM OF FACE OF SECURITY)
9 5/8% Senior Notes due 2007
No. $
------------ ---------
CUSIP NO. 899900AB0
Tultex Corporation, a corporation duly organized and existing under
the laws of Virginia (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to _______________________, or registered
assigns, the principal sum of ___________________ Dollars on April 15, 2007, and
to pay interest thereon from April 17, 1997 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semi-annually
on April 15 and October 15 in each year, commencing October 15, 1997, at the
rate of 9 5/8% per annum, until the principal hereof is paid or made available
for payment, and at the same rate per annum on any overdue principal and premium
and on any overdue installment of interest until paid. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such 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 the April 1 or
October 1 (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid 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 for the payment of such Defaulted Interested to be
fixed by the Trustee, notice whereof shall be given to Holders of Securities not
less than five Business Days prior to such Special Record Date, or 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 (and premium, if any) and any such
interest on this Security will be made at the office or agency of the Company
maintained for that purpose in the Borough of Manhattan, The City of New York,
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts; provided,
--------
however, that at the option of the Company payment of
- -------
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register.
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
executed by the Trustee referred to on the reverse hereof 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.
Dated:
TULTEX CORPORATION
By:
-------------------------
Title:
Attest:
- --------------------------
Certificate of Authentication:
This is one of the 9 5/8% Senior Notes due 2007 referred to
in the within-mentioned Indenture.
[ ], a Trustee
By: Date:
----------------------------------
Authorized Signatory
A-2
(FORM OF REVERSE OF SECURITY)
This Security is one of a duly authorized issue of Securities
of the Company designated as its 9 5/8% Senior Notes due 2007 (herein called the
"Securities"), limited in aggregate principal amount to $75,000,000, issued and
to be issued under an Indenture, dated as of April 15, 1997 (herein called the
"Indenture"), among the Company, the Guarantors listed on the signature pages
thereto (herein collectively called the "Guarantors", which term includes any
successor Person, or additional Guarantor, under the Indenture) and First Union
National Bank of Virginia, as Trustee (herein called the "Trustee", which term
includes any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Guarantors, the Trustee and the Holders of the Securities and
of the terms upon which the Securities are and the Guarantees endorsed thereon
are, and are to be, authenticated and delivered.
The Securities are subject to redemption upon not less than 30
nor more than 60 days' notice by mail, at any time on or after April 15, 2002,
as a whole or in part, at the election of the Company, at the following
Redemption Prices (expressed as percentages of the principal amount): If re-
deemed during the 12-month period beginning April 15 of the years indicated,
Redemption
Year Price
- ---- ----------
2002 104.813%
2003 103.208%
2004 101.604
2005 and thereafter 100.000
and thereafter at a Redemption Price equal to 100% of the principal amount,
together in the case of any such redemption with accrued interest to the
Redemption Date.
The Securities do not have the benefit of any sinking fund
obligations.
In the event of redemption or purchase pursuant to an Offer to
Purchase of this Security in part only, a new Security or Securities for the
unredeemed or unpurchased portion hereof will 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 of all the Securities may be declared due and
A-3
payable in the manner and with the effect provided in the Indenture.
The Indenture provides that, subject to certain conditions,
if (i) certain Net Available Proceeds are available from an Asset Disposition or
(ii) a Change of Control occurs, the Company shall be required to make an Offer
to Purchase all or a specified portion of the Securities.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the Guarantors and the rights of the Holders of
the Securities under the Indenture at any time by the Company, the Guarantors
and the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Securities at the time outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages 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 and the
Guarantors with certain provisions of the Indenture and certain past Defaults
under the Indenture and their consequences. Any such consent or waiver by 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, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Security at the times, place and rate, and
in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in the Borough of Manhattan, The
City of New York, 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
A-4
certain limitations therein set forth, 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 such registration of
transfer or exchange, 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 Guarantors, the Trustee and any agent of the Company,
the Guarantors 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
be overdue, and none of the Company, any Guarantor, the Trustee or any such
agent shall be affected by notice to the contrary.
Interest on this Security shall be computed on the basis of a
360-day year of twelve 30-day months. Holders of record on a Regular Record Date
immediately prior to an Interest Payment Date shall be entitled to receive the
interest pay able on the Securities on such Interest Payment Date
notwithstanding any call for redemption of such Securities on a Redemption Date
which is to occur on or subsequent to such Interest Payment Date.
Customary abbreviations may be used in the name of a Holder or
an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Securities
or as contained in any notice of redemption and reliance may be placed only on
the other identification numbers placed thereon.
The Company will furnish to any Holder of record of Securities
upon written request and without charge a copy of the Indenture.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
A-5
The Indenture, this Security and the Guarantees endorsed hereon shall
be governed by and construed in accordance with the laws of the State of New
York without regard to principles of conflicts of law.
A-6
(FORM OF GUARANTEE)
GUARANTEE
The Guarantors (as defined in the Indenture referred to in the
Security upon which this notation is endorsed) hereby, jointly and severally,
unconditionally guarantee (such guarantee by each Guarantor being referred to
herein as the "Guarantee") the due and punctual payment of the principal of,
premium, if any, and interest on the Securities, whether at maturity, by
acceleration or otherwise, the due and punctual payment of interest on the
overdue principal, premium and interest, if any, on the Securities, and the due
and punctual performance of all other obligations of the Company to the Holders
or the Trustee, all in accordance with the terms set forth in Article Twelve of
the Indenture.
The Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Securities upon which the
Guarantee is noted shall have been executed by the Trustee under the Indenture
by the manual signature of one of its authorized officers.
This Guarantee shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflicts of law.
This Guarantee is subject to release upon the terms set forth
in the Indenture.
AKOM, LTD.
DOMINION STORES, INC.
LOGOATHLETIC, INC.
LOGOATHLETIC/HEADWEAR, INC.
SWEATJET INCORPORATED
TULTEX CANADA, INC.
TULTEX INTERNATIONAL, INC.
By:
-----------------------------
Name:
Title: An Authorized
Officer of Each of
the Above-Listed
Guarantors
A-7
ASSIGNMENT FORM
If you the Holder want to assign this Security, fill in the
form below and have your signature guaranteed:
I or we assign and transfer this Security to:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint ,
------------------------------------------------------
agent to transfer this Security on the books of the Company.
The agent may substitute another to act for him.
Dated: Signed:
---------------------- --------------------------
(Sign exactly as name
appears on the other side
of this Security)
Signature Guarantee:
----------------------------------------------------------
A-8
OPTION OF HOLDER TO ELECT PURCHASE
If you the Holder want to elect to have this Security purchased by the Company,
check the box: |_|
If you want to elect to have only part of this Security purchased by the
Company, state the amount: $
----------------
Dated: Signed:
--------------------------- ---------------------------
(Sign exactly as name
appears on the other side
of this Security)
Signature Guarantee:
-----------------------------------------------------------
A-9
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Tultex Corporation
101 Commonwealth Boulevard
Martinsville, Virginia 24112
Attention:
[Name and Address of Registrar]
Re: 9 5/8% Senior Notes due 2007
Reference is hereby made to the Indenture, dated as of April
15, 1997 (the "Indenture"), among Tultex Corporation (the "Company"), the
Guarantors named therein (the "Guarantors") and First Union National Bank of
Virginia, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
________________, (the "Transferor") owns and proposes to
transfer the Security[s] specified in Annex A hereto in the principal amount of
$___ in such Security[s] (the "Transfer"), to ________ (the "Transferee"), as
further specified in Annex A hereto. In the event that Transferor holds
Physical Securities, this Certificate is accompanied by one or more certificates
aggregating at least the principal amount of Securities proposed to be
Transferred. In connection with the Transfer, the Transferor hereby certifies
that:
1. [_] Check if Transferee will take an Interest in the 144A Global Security.
---------------------------------------------------------------------
The Transfer is being effected pursuant to and in accordance with Rule 144A
under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
Securities are being transferred to a Person that the Transferor reasonably
believes is purchasing the Securities for its own account, or for one or more
accounts with respect to which such Person exercises sole investment discretion,
and such Person and each such account is a "qualified institutional buyer"
within the meaning of Rule 144A in a transaction meeting the requirements of
Rule 144A and such Transfer is in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Transfer in accordance with the terms of the Indenture, the transferred
Security will be subject to the restrictions on transfer enumerated in the
Securities Act Legend and in the Indenture and the Securities Act.
2. |_| Check if Transferee will take an Interest in the Regulation S Global
--------------------------------------------------------------------
Security pursuant to Regulation S. The Transfer is being effected pursuant to
- ---------------------------------
and in accordance with Rule 904 under the Securities Act and, accordingly, the
Transferor hereby further certifies that (i) the Transfer is not being made to
a person in the United States and (x) at the time the buy order was originated,
the Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 904(b) of Regulation
S under the Securities Act and (iii) the transaction is not part of a plan or
scheme to evade the registration requirements of the Securities Act. Upon
consummation of the proposed transfer in accordance with the terms of the
Indenture, the Security will be subject to the restrictions on Transfer
enumerated in the Securities Act Legend printed on the Regulation S Global
Security and in the Indenture and the Securities Act.
3. |_| Check and complete if Transferee will take delivery of a Restricted
-------------------------------------------------------------------
Physical Security pursuant to Rule 144A or Regulation S. One or more of the
- -------------------------------------------------------
events specified in Section 206(a) of the Indenture have occurred and the
Transfer is being effected in compliance with the transfer restrictions
applicable to Securities bearing the Securities Act Legend and pursuant to and
in accordance with the Securities Act, and accordingly the Transferor hereby
further certifies that (check one):
(a) |_| such Transfer is being effected pursuant to and in accordance
with Rule 144A under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 1 above; or
(b) |_| such Transfer is being effected pursuant to and in accordance
with Rule 904 under the Securities Act and the Transferor certifies to the
effect set forth in paragraph 2 above.
4. |_| Check if Transferee will take an Interest in the Unrestricted Global
--------------------------------------------------------------------
Security. The Transfer is being effected pursuant to and in accordance with
- --------
Rule 144 under the Securities Act and in compliance with the transfer
restrictions contained in the Indenture, and the restrictions on transfer
contained in the Indenture and the Securities Act Legend are not required in
order to maintain compliance with the Securities Act. Upon consummation of the
proposed Transfer in accordance with the
B-2
terms of the Indenture, the transfer Securities will no longer be subject to the
restrictions on transfer enumerated in the Securities Act Legend and in the
Indenture and the Securities Act.
5. [_] Check if Transferee will take an Interest in the Physical Global Security
-------------------------------------------------------------------------
that does not bear the Securities Act Legend. One or more of the events
- --------------------------------------------
specified in Section 206(a) of the Indenture have occurred and the Transfer is
being effected pursuant to and in accordance with Rule 144 under the Securities
Act and in compliance with the transfer restrictions contained in the Indenture,
and the restrictions on transfer contained in the Indenture and the Securities
Act Legend are not required in order to maintain compliance with the Securities
Act. Upon consummation of the proposed Transfer in accordance with the terms of
the Indenture, the transferred Securities will no longer be subject to the
restrictions on transfer enumerated in the Securities Act Legend and in the
Indenture and the Securities Act.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Guarantors.
---------------------------------
[Insert Name of Transferor]
By:
-----------------------------
Name:
Title:
Dated:_________________
B-3
FORM OF ANNEX A TO CERTIFICATE
OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [_] Interests in the
(i) [_] 144A Global Security (CUSIP _____), or
(ii) [_] Regulation S Global Security (CINS _____).
(b) [_]Physical Security.
2. That the Transferee will hold:
[CHECK ONE]
(a) [_] Interests in the:
(i) [_] 144A Global Security (CUSIP _____), or
(ii) [_] Regulation S Global Security (CINS _____), or
(iii) [_] Unrestricted Global Security (CUSIP _____); or
(b) [_] Physical Securities that bear the Securities Act
Legend;
(c) [_] Physical Securities that do not bear the Securities
Act Legend;
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Tultex Corporation
101 Commonwealth Boulevard
Martinsville, Virginia 24112
Attention:
[Name and Address of Registrar]
Re: 9 5/8% Senior Notes due 2007
(CUSIP _______________)
Reference is hereby made to the Indenture, dated as of
April 15, 1997 (the "Indenture"), among Tultex Corporation (the "Company"), the
---------
Guarantors named therein (the "Guarantors") and First Union National Bank of
Virginia, as trustee. Capitalized terms used but not defined herein shall have
the meanings given to them in the Indenture.
__________, (the "Holder") owns and proposes to exchange the
------
Security[s] specified herein, in the principal amount of $___ in such
Security[s] (the "Exchange"). In the event Holder holds Physical Securities,
--------
this Certificate is accompanied by one or more certificates aggregating at
least the principal amount of Securities proposed to be Exchanged. In connection
with the Exchange, the Holder hereby certifies that:
1. Exchange of Restricted Physical Securities or Interests in the Initial
Global Security for Physical Securities that do not bear the Securities Act
Legend or Unrestricted Global Securities
(a) [_] Check if Exchange is from Initial Global Securities to the
----------------------------------------------------------
Unrestricted Global Security. In connection with the Exchange of the Holder's
- ----------------------------
Initial Global Security to the Unrestricted Global Security in an equal
principal amount, the Holder hereby certifies (i) the Unrestricted Global
Securities are being acquired for the Holder's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Initial Global Securities and pursuant to and in
accordance with the Securities Act of 1933, as amended (the "Securities Act")
--------------
and (iii) the restrictions on transfer contained in the Indenture and the
Securities Act Legend are not required in order to maintain compliance with the
Securities Act.
(b) [_] Check if Exchange is from Restricted Physical Securities to an
--------------------------------------------------------------
Interest in the Unrestricted Global Security. In connection with the Holder's
- --------------------------------------------
Exchange of Restricted Physical Securities for Interest in the Unrestricted
Global Security, (i) the Interest in the Unrestricted Global Security are being
acquired for the Holder's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to
Restricted Physical Securities and pursuant to and in accordance with the
Securities Act and (iii) the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act.
(c) [_] Check if Exchange is from Restricted Physical Securities to
-----------------------------------------------------------
Physical Securities that do not bear the Securities Act Legend. In connection
- --------------------------------------------------------------
with the Holder's Exchange of a Restricted Physical Security for Physical
Securities that do not bear the Securities Act Legend, the Holder hereby
certifies (i) the Physical Securities that do not bear the Securities Act Legend
are being acquired for the Holder's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Physical Securities and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Securities Act Legend are not required in order to maintain
compliance with the Securities Act and (iv) one or more of the events specified
in Section 206(a) of the Indenture have occurred.
2. [_] Check if Exchange is from Restricted Physical Securities to Interests in
------------------------------------------------------------------------
an Initial Global Security. In connection with the Exchange of the Holder's
- --------------------------
Restricted Physical Security for interests in the Initial Global Security in
the [CHECK ONE] [_] 144A Global Security, [_] Regulation S Global Security,
with an equal principal amount, (i) the interests in the Initial Global Security
are being acquired for the Holder's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Physical Security and pursuant to and in accordance
with the Securities Act. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Initial Global Security issued
will be subject to the restrictions on transfer enumerated in the Securities Act
Legend printed on the Initial Global Securities and in the Indenture and the
Securities Act.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Guarantors.
C-2
------------------------------------
[Insert Name of Holder]
By:
---------------------------------
Name:
Title:
Dated:
---------------------
C-3