1
Exhibit 4.1
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INDENTURE
DATED AS OF AUGUST 18, 1997
BETWEEN
FEDDERS NORTH AMERICA, INC., AS ISSUER,
AND
FEDDERS CORPORATION, AS GUARANTOR,
AND
STATE STREET BANK AND TRUST COMPANY, AS TRUSTEE
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$100,000,000
9 3/8% SENIOR SUBORDINATED SECURITIES DUE 2007
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CROSS-REFERENCE TABLE
TRUST INDENTURE INDENTURE
ACT SECTION SECTION
Section 310(a)(1)............................................ 7.10
(a)(2)............................................ 7.10
(a)(3)............................................ N.A.
(a)(4)............................................ N.A.
(a)(5)............................................ 7.08, 7.10.
(b)............................................... 7.08; 7.10; 13.02
(c)............................................... N.A.
Section 311(a)............................................... 7.11
(b)............................................... 7.11
(c)............................................... N.A.
Section 312(a)............................................... 2.05
(b)............................................... 13.03
(c)............................................... 13.03
Section 313(a)............................................... 7.06
(b)(1)............................................ 7.06
(b)(2)............................................ 7.06
(c)............................................... 7.06; 13.02
(d)............................................... 7.06
Section 314(a)............................................... 4.11; 4.12; 13.02
(b)............................................... N.A.
(c)(1)............................................ 13.04
(c)(2)............................................ 13.04
(c)(3)............................................ N.A.
(d)............................................... N.A.
(e)............................................... 13.05
(f)............................................... N.A.
Section 315(a)............................................... 7.01(b)
(b)............................................... 7.05; 13.02
(c)............................................... 7.01(a)
(d)............................................... 7.01(c)
(e)............................................... 6.11
Section 316 (a)(last sentence)................................ 2.09
(a)(1)(A)......................................... 6.05
(a)(1)(B)......................................... 6.04
(a)(2)............................................ N.A.
(b)............................................... 6.07
(c)............................................... 10.04
Section 317(a)(1)............................................ 6.08
(a)(2)............................................ 6.09
(b)............................................... 2.04
Section 318(a)............................................... 13.01
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N.A. means Not Applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
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TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.....................................................1
SECTION 1.02. Incorporation by Reference of Trust Indenture Act..............15
SECTION 1.03. Rules of Construction..........................................15
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating................................................16
SECTION 2.02. Execution and Authentication...................................18
SECTION 2.03. Registrar and Paying Agent.....................................19
SECTION 2.04. Paying Agent to Hold Assets in Trust...........................19
SECTION 2.05. Securityholder Lists...........................................19
SECTION 2.06. Transfer and Exchange..........................................20
SECTION 2.07. Replacement Securities.........................................25
SECTION 2.08. Outstanding Securities.........................................25
SECTION 2.09. Treasury Securities............................................25
SECTION 2.10. Temporary Securities...........................................26
SECTION 2.11. Cancellation...................................................26
SECTION 2.12. Defaulted Interest.............................................26
SECTION 2.13. CUSIP Number...................................................26
SECTION 2.14. Deposit of Moneys..............................................26
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.............................................27
SECTION 3.02. Selection of Securities to Be Redeemed.........................27
SECTION 3.03. Notice of Redemption...........................................27
SECTION 3.04. Effect of Notice of Redemption.................................28
SECTION 3.05. Deposit of Redemption Price....................................28
SECTION 3.06. Securities Redeemed in Part....................................28
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ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities..........................................29
SECTION 4.02. Maintenance of Office or Agency................................29
SECTION 4.03. Transactions with Affiliates...................................29
SECTION 4.04. Limitation on Incurrence of Indebtedness.......................30
SECTION 4.05. Limitation on Certain Asset Sales..............................31
SECTION 4.06. Limitation on Restricted Payments..............................33
SECTION 4.07. Corporate Existence............................................35
SECTION 4.08. Payment of Taxes and Other Claims..............................36
SECTION 4.09. Notice of Defaults.............................................36
SECTION 4.10. Maintenance of Properties and Insurance........................36
SECTION 4.11. Compliance Certificate.........................................37
SECTION 4.12. Provision of Financial Information.............................37
SECTION 4.13. Waiver of Stay, Extension or Usury Laws........................37
SECTION 4.14. Change of Control..............................................37
SECTION 4.15. Limitation on Senior Subordinated Indebtedness.................39
SECTION 4.16. Limitations on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries......................................39
SECTION 4.17. Designation of Restricted and Non-Restricted Subsidiaries......40
SECTION 4.18. Limitation on Liens............................................40
SECTION 4.19. Limitation on Sale and Leaseback Transactions..................41
SECTION 4.20. Limitation on Guarantees of Company Indebtedness by Restricted
Subsidiaries.................................................41
ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidation and Sale of Assets......................42
SECTION 5.02. Successor Corporation Substituted..............................42
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default..............................................42
SECTION 6.02. Acceleration...................................................44
SECTION 6.03. Other Remedies.................................................44
SECTION 6.04. Waiver of Past Default.........................................44
SECTION 6.05. Control by Majority............................................45
SECTION 6.06. Limitation on Suits............................................45
SECTION 6.07. Rights of Holders to Receive Payment...........................46
SECTION 6.08. Collection Suit by Trustee.....................................46
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SECTION 6.09. Trustee May File Proofs of Claim...............................46
SECTION 6.10. Priorities.....................................................46
SECTION 6.11. Undertaking for Costs..........................................47
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee..............................................47
SECTION 7.02. Rights of Trustee..............................................48
SECTION 7.03. Individual Rights of Trustee...................................49
SECTION 7.04. Trustee's Disclaimer...........................................49
SECTION 7.05. Notice of Defaults.............................................49
SECTION 7.06. Reports by Trustee to Holders..................................50
SECTION 7.07. Compensation and Indemnity.....................................50
SECTION 7.08. Replacement of Trustee.........................................51
SECTION 7.09. Successor Trustee by Merger, etc...............................52
SECTION 7.10. Eligibility; Disqualification..................................52
SECTION 7.11. Preferential Collection of Claims Against Company..............52
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior Indebtedness.................52
SECTION 8.02. No Payment on Securities in Certain Circumstances..............53
SECTION 8.03. Payment Over of Proceeds upon Dissolution, etc.................54
SECTION 8.04. Subrogation....................................................55
SECTION 8.05. Obligations of Company Unconditional...........................55
SECTION 8.06. Notice to Trustee..............................................56
SECTION 8.07. Reliance on Judicial Order or Certificate of Liquidating Agent.56
SECTION 8.08. Trustee's Relation to Senior Indebtedness......................56
SECTION 8.09. Subordination Rights Not Impaired by Acts or Omissions of the
Company or Holders of Senior Indebtedness....................57
SECTION 8.10. Securityholders Authorize Trustee to Effectuate
Subordination of Securities..................................57
SECTION 8.11. This Article Not to Prevent Events of Default..................57
SECTION 8.12. Trustee's Compensation Not Prejudiced..........................57
SECTION 8.13. No Waiver of Subordination Provisions..........................57
SECTION 8.14. Subordination Provisions Not Applicable to Collateral Held
in Trust for Securityholders; Payments May Be Paid Prior
to Dissolution...............................................58
SECTION 8.15. Acceleration of Securities.....................................58
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ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture.........................................58
SECTION 9.02. Legal Defeasance...............................................59
SECTION 9.03. Covenant Defeasance............................................59
SECTION 9.04. Conditions to Defeasance or Covenant Defeasance................59
SECTION 9.05. Deposited Money and U.S Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions................61
SECTION 9.06. Reinstatement..................................................61
SECTION 9.07. Moneys Held by Paying Agent....................................62
SECTION 9.08. Moneys Held by Trustee.........................................62
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders.....................................62
SECTION 10.02. With Consent of Holders........................................63
SECTION 10.03. Compliance with Trust Indenture Act............................64
SECTION 10.04. Revocation and Effect of Consents..............................64
SECTION 10.05. Notation on or Exchange of Securities..........................64
SECTION 10.06. Trustee to Sign Amendments, etc................................65
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee........................................65
SECTION 11.02. Severability...................................................66
SECTION 11.03. Limitation of Guarantor's Liability............................66
SECTION 11.04. Subordination of Subrogation and Other Rights..................66
SECTION 11.05. Delivery of Guarantee..........................................66
ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated to Guarantor
Senior Indebtedness..........................................66
SECTION 12.02. No Payment on Guarantee in Certain Circumstances...............67
SECTION 12.03. Payment Over of Proceeds upon Dissolution, etc.................68
SECTION 12.04. Subrogation....................................................69
SECTION 12.05. Obligations of Guarantor Unconditional.........................69
SECTION 12.06. Notice to Trustee..............................................70
SECTION 12.07. Reliance on Judicial Order or Certificate of Liquidating Agent.70
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SECTION 12.08. Trustee's Relation to Guarantor Senior Indebtedness............71
SECTION 12.09. Subordination Rights Not Impaired by Acts or Omissions
of the Guarantor or Holders of Guarantor Senior Indebtedness.71
SECTION 12.10. Securityholders Authorize Trustee to Effectuate
Subordination of Guarantee...................................71
SECTION 12.11. This Article Not to Prevent Events of Default..................71
SECTION 12.12. Trustee's Compensation Not Prejudiced..........................72
SECTION 12.13. No Waiver of Guarantee Subordination Provisions................72
SECTION 12.14. Payments May Be Paid Prior to Dissolution......................72
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls...................................72
SECTION 13.02. Notices........................................................73
SECTION 13.03. Communications by Holders with Other Holders...................74
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.............74
SECTION 13.05. Statements Required in Certificate or Opinion..................74
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar......................75
SECTION 13.07. Governing Law..................................................75
SECTION 13.08. No Recourse Against Others.....................................75
SECTION 13.09. Successors.....................................................75
SECTION 13.10. Counterpart Originals..........................................75
SECTION 13.11. Severability...................................................75
SECTION 13.12. No Adverse Interpretation of Other Agreements..................75
SECTION 13.13. Legal Holidays.................................................75
SIGNATURES...................................................................S-1
EXHIBIT A Form of Series A Security..........................................A-1
EXHIBIT B Form of Series B Security..........................................B-1
EXHIBIT C Form of Legend for Global Securities...............................C-1
EXHIBIT D Form of Transfer Certificate.......................................D-1
EXHIBIT E Form of certification to be given by the holders of beneficial
interest in a temporary Regulation S global security to Euroclear
or Cedel
EXHIBIT F Form of certification to be given by Euroclear operator or Cedel Bank,
Societe Anonyme
EXHIBIT G Form of certification to be given by transferee of beneficial
interest in a temporary Regulation S global security
EXHIBIT H Form of certification for transfer or exchange of restricted global
security to temporary Regulation S global security
EXHIBIT I Form of certification for transfer or exchange of restricted global
security to permanent Regulation S global security
EXHIBIT J Form of certification for transfer or exchange of temporary
Regulation S global security or permanent Regulation S global security
to restricted global security
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EXHIBIT K-1 Form of certification for transfer or exchange of non-global
restricted security to restricted global security
EXHIBIT K-2 Form of certification for transfer or exchange of non-global
restricted security to permanent Regulation S global security or
temporary Regulation S global security
EXHIBIT L-1 Form of certification for transfer or exchange of non-global
permanent Regulation S security to restricted global security
EXHIBIT L-2 Form of certification for transfer or exchange of non-global
permanent Regulation S security to permanent Regulation S global
security
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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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9
INDENTURE dated as of August 18, 1997, between FEDDERS NORTH AMERICA,
INC., a Delaware corporation (the "Company"), FEDDERS CORPORATION, a Delaware
corporation (the "Guarantor") and STATE STREET BANK AND TRUST COMPANY, a
Massachusetts trust company, as trustee (the "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 Securities:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acceleration Notice" see Section 6.02.
"Affiliate" means any of the following: (i) any Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company, (ii) any spouse, immediate family member or other
relative who has the same principal residence as any Person described in clause
(i) above, (iii) any trust in which any such Persons described in clause (i) or
(ii) above has a beneficial interest, and (iv) any corporation or other
organization of which any such Persons described above collectively owns 10% or
more of the equity of such entity.
"Affiliate Transaction" see Section 4.03.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" see Section 2.06(g).
"Asset Sale" means the sale, lease, conveyance or other disposition by
the Company or a Restricted Subsidiary of assets or property whether owned on
the date of original issuance of the Securities or thereafter acquired, in a
single transaction or in a series of related transactions; provided that Asset
Sales will not include such sales, leases, conveyances or dispositions in
connection with (i) the surrender or waiver of contract rights or the
settlement, release or surrender of contract, tort or other claims of any kind,
(ii) the sale of inventory in the ordinary course of business, (iii) a
sale-leaseback of assets within one year following the acquisition of such
assets, (iv) the grant of any license of patents, trademarks, registration
therefor and other similar intellectual property, (v) a transfer of assets by
the Company or a Restricted Subsidiary to the Company or a Restricted
Subsidiary, (vi) the designation of a Restricted Subsidiary as a Non-Restricted
Subsidiary pursuant to Section 4.17, (vii) the sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company as
permitted under Section 5.01, (viii) the sale or disposition of obsolete
equipment or other obsolete assets, (ix) Restricted Payments permitted by
Section 4.06 or (x) the exchange of assets for other non-cash assets that (a)
are useful in the business of the Company and its Restricted Subsidiaries and
(b) have a fair market value at least equal to the fair market value of the
assets being exchanged (as deter-
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mined in good faith by the Board of Directors or the board of directors of the
Restricted Subsidiary which owns such assets).
"Asset Sale Disposition Date" see Section 4.05.
"Asset Sale Offer " see Section 4.05.
"Asset Sale Purchase Date" see Section 4.05.
"Asset Sale Trigger Date" see Section 4.05.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Bankruptcy Law" see Section 6.01.
"Board of Directors" means the Company's board of directors or any
authorized committee of such board of directors.
"Book-Entry Security" means a Security represented by a Global Security
and registered in the name of the nominee of the Depository.
"Business Day" means a day (other than a Saturday or Sunday) on which
the Depository and banks in New York, and banks in the city in which the
Corporate Trust Office of the Trustee is located, are open for business.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of corporate stock, including any
Preferred Stock.
"Cash Flow" means, for any given period and Person, the sum of, without
duplication, Consolidated Net Income, plus (a) any provision for taxes based on
income or profits to the extent such income or profits were included in
computing Consolidated Net Income, plus (b) Consolidated Interest Expense, to
the extent deducted in computing Consolidated Net Income, plus (c) the
amortization of all intangible assets, to the extent such amortization was
deducted in computing Consolidated Net Income (including, but not limited to,
inventory write-ups, goodwill, debt and financing costs), plus (d) all
depreciation and all other non-cash charges (including, without limitation,
those charges relating to purchase accounting adjustments and LIFO adjustments),
to the extent deducted in computing Consolidated Net Income, plus (e) any
interest income, to the extent such income was not included in computing
Consolidated Net Income, plus (f) all dividend payments on Preferred Stock
(whether or not paid in cash) to the extent deducted in computing Consolidated
Net Income; provided, however, that, if any such calculation includes any period
during which an acquisition or sale of a Person or the incurrence or repayment
of Indebtedness occurred, then such calculation for such period shall be made on
a Pro Forma Basis.
"Cash Flow Coverage Ratio" means, for any given period and Person, the
ratio of: (i) Cash Flow, divided by (ii) the sum of Consolidated Interest
Expense (except dividends paid or payable in additional
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shares of Capital Stock (other than Disqualified Stock)) in each case, without
duplication; provided, however, that if any such calculation includes any period
during which an acquisition or sale of a Person or the incurrence or repayment
of Indebtedness occurred, then such calculation for such period shall be made on
a Pro Forma Basis.
"CEDEL" means Cedel Bank, Societe Anonyme (or any successor securities
clearing agency).
"Certificated Securities" see Section 2.01.
"Change of Control" means the occurrence of any of the following: (i)
any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of
the Exchange Act), excluding the Existing Stockholders, is or becomes the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a person shall be deemed to have "beneficial ownership" of all
securities that such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of more than 50% of the total Voting Stock of the Company or of the
Guarantor; or (ii) the Company or the Guarantor consolidates with, or merges
with or into, another person or sells, assigns, conveys, transfers, leases or
otherwise disposes of all or substantially all of its assets to any person, or
any person consolidates with, or merges with or into, the Company or the
Guarantor, in any such event pursuant to a transaction in which the outstanding
Voting Stock of the Company or of the Guarantor is converted into or exchanged
for cash, securities or other property, other than any such transaction where
(A) the outstanding Voting Stock of the Company or of the Guarantor is converted
into or exchanged for (1) Voting Stock (other than Disqualified Stock) of the
surviving or transferee corporation or (2) cash, securities and other property
in an amount which could be paid by the Company as a Restricted Payment under
the Indenture and (B) immediately after such transaction no "person" or "group"
(as such terms are used in Sections 13(d) and 14(d) of the Exchange Act),
excluding the Existing Stockholders, is the "beneficial owner" (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act, except that a person shall be
deemed to have "beneficial ownership" of all securities that such person has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 50% of the total
Voting Stock of the surviving or transferee corporation; or (iii) during any
consecutive two-year period, individuals who at the beginning of such period
constituted the Board of Directors or the board of directors of the Guarantor
(together with any new directors whose election by such Board of Directors or
the board of directors of the Guarantor whose nomination for election by the
stockholders of the Company was approved by a vote of a majority of the
directors then still in office who are entitled to vote to elect such new
director and were either directors at the beginning of such period or persons
whose election as directors or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors or the board of directors of the Guarantor then in office.
"Change of Control Offer" see Section 4.14.
"Change of Control Purchase Date" see Section 4.14.
"Change of Control Trigger Date" see Section 4.14.
"Commission" means the Securities and Exchange Commission.
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"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President, a Vice President or its Treasurer, and by
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Consolidated Interest Expense" means, for any given period and Person,
the aggregate of (i) the interest expense in respect of all Indebtedness of such
Person and its Restricted Subsidiaries for such period, on a consolidated basis,
determined in accordance with GAAP (including amortization of original issue
discount on any such Indebtedness, all non-cash interest payments, the interest
portion of any deferred payment obligation and the interest component of capital
lease obligations, but excluding amortization of deferred financing fees if such
amortization would otherwise be included in interest expense) and (ii) the
product of (a) all cash dividend payments (and non-cash dividend payments in the
case of a Person that is a Restricted Subsidiary) on any series of Preferred
Stock of such Person and its Restricted Subsidiaries payable to a party other
than the Company or a wholly owned Subsidiary, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current combined federal, state and local statutory tax rate of such Person,
expressed as a decimal, on a consolidated basis and in accordance with GAAP;
provided, however, that for the purpose of the Cash Flow Coverage Ratio,
Consolidated Interest Expense shall be calculated on a Pro Forma Basis.
"Consolidated Net Income" means, for any given period and Person, the
aggregate of the Net Income of such Person and its Restricted Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP;
provided, however, that: (i) the Net Income of any Person acquired in a pooling
of interests transaction for any period prior to the date of such acquisition
shall be excluded, (ii) the Net Income (but not loss) of any Person that is not
a Restricted Subsidiary or that is accounted for by the equity method of
accounting shall be included only to the extent of the amount of dividends or
distributions paid in cash to the referent Person, (iii) the Net Income of any
Restricted Subsidiary shall be excluded to the extent that the declaration or
payment of dividends or similar distributions by that Restricted Subsidiary of
that Net Income is not at the date of determination permitted without any prior
governmental approval (which has not been obtained) or, directly or indirectly,
by operation of the terms of its charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
Restricted Subsidiary or its stockholders, (iv) the cumulative effect of a
change in accounting principles shall be excluded, (v) income or loss
attributable to discontinued operations shall be excluded and (vi) all other
extraordinary, unusual or nonrecurring gains or losses shall be excluded;
provided, however, that for purposes of determining the Cash Flow Coverage
Ratio, Consolidated Net Income shall be calculated on a Pro Forma Basis.
"Consolidated Net Worth" means, with respect to any Person at any date,
the sum of (i) the consolidated stockholders' equity of such Person less the
amount of such stockholders' equity attributable to Disqualified Stock of such
Person and its Subsidiaries (Restricted Subsidiaries, in the case of the
Company), as determined on a consolidated basis in accordance with GAAP
consistently applied and (ii) the amount of any Preferred Stock of such Person
not included in the stockholders' equity of such Person in accordance with GAAP,
which Preferred Stock does not constitute Disqualified Stock.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 13.02 or such other address as the Trustee may give
notice to the Company.
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"Covenant Defeasance Option" see Section 9.02.
"Credit Agreement" means collectively, the Accounts Financing Agreement
[Security Agreement] between Columbia Specialties, Inc., and Congress Financial
Corporation dated December 23, 1992 and the Accounts Financing Agreement
[Security Agreement] by and among Fedders North America, Inc., Emerson Quiet
Kool Corporation and Congress Financial Corporation dated December 23, 1992,
together with all loan documents and instruments thereunder (including, without
limitation, any guarantee agreements, covenant supplements and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented or otherwise modified from time
to time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including, without limitation, increasing
the amount of available borrowings thereunder, and all Obligations with respect
thereto, in each case, to the extent permitted by Section 4.04 or adding
Subsidiaries of the Company as additional borrowers or guarantors thereunder)
all or any portion of the Indebtedness under such agreement or any successor or
replacement agreement and whether by the same or any other agent, lender or
group of lenders.
"Custodian" see Section 6.01.
"Default" means any event that is, or after notice or passage of time
or both would be, an Event of Default.
"defeasance trust" see Section 9.04.
"Depository" means, with respect to the Securities issued in the form
of one or more Global Securities, The Depository Trust Company or another Person
designated as Depository by the Company, which must be a clearing agency
registered under the Exchange Act.
"Depository Securities Certification" see Section 2.01.
"Designated Guarantor Senior Indebtedness" means (i) the guarantee by
the Guarantor of any Indebtedness outstanding under the Credit Agreement and
(ii) any other Guarantor Senior Indebtedness of the Guarantor the principal
amount of which is $20,000,000 or more.
"Designated Senior Indebtedness" means (i) any Indebtedness outstanding
under the Credit Agreement and (ii) any other Senior Indebtedness permitted
under the Indenture the principal amount of which is $20,000,000 or more and
that has been designated by the Company as Senior Indebtedness.
"Disposition" see Section 5.01.
"Disqualified Stock" with respect to any Person means any Capital Stock
or Equity Interests that by its terms (or by the terms of any security into
which it is convertible or for which it is exchangeable), or upon the happening
of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part on, or prior to, the maturity date of the Securities, or any
Capital Stock or Equity Interests in any Restricted Subsidiary of such Person.
"Equity Interests" means Capital Stock or partnership interests or
warrants, options or other rights to acquire Capital Stock or partnership
interests (but excluding (i) any debt security that is convertible
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into, or exchangeable for, Capital Stock or partnership interests, and (ii) any
other Indebtedness or Obligation).
"Equity Offering" means a public or private offering by the Company or
the Guarantor for cash of Capital Stock or other Equity Interests and all
warrants, options or other rights to acquire Capital Stock, other than an
offering of Disqualified Stock.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency).
"Event of Default" see Section 6.01.
"Excess Proceeds" see Section 4.05.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the Commission thereunder.
"Existing Stockholders" means the officers and directors of each of the
Company and the Guarantor on the date of issuance of the Securities and their
respective Affiliates and family members and trusts for the benefit of any of
the foregoing.
"Final Maturity Date" means August 15, 2007.
"GAAP" means generally accepted accounting principles, consistently
applied, as in effect in the United States from time to time. All financial and
accounting determinations and calculations under the Indenture will be made in
accordance with GAAP.
"Global Security" means a security evidencing all or a portion of the
Securities issued to the Depository or its nominee in accordance with Section
2.01 and bearing the legend set forth in Exhibit C hereto.
"Guarantee" means the guarantee of the Obligations of the Company with
respect to the Securities by the Guarantor pursuant to the terms of Article 11
hereof.
"Guaranteed Obligations" see Section 11.01.
"Guarantor" means Fedders Corporation, the sole stockholder of the
Company.
"Guarantor Blockage Period" see Section 12.02(a).
"Guarantor Payment Blockage Notice" see Section 12.02(a).
"Guarantor Senior Indebtedness" means, with respect to the Guarantor,
the Guarantor's guarantee of the Company's obligations under the Credit
Agreement and any other Indebtedness of the Guarantor (other than as otherwise
provided in this definition), whether outstanding on the date of the Indenture
or thereafter created, incurred or assumed, unless, in the case of any
particular Indebtedness, the instrument creating or evidencing the same or
pursuant to which the same is outstanding expressly provides that such
Indebt-
15
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edness shall not be senior in right of payment to the Guarantee. Notwithstanding
the foregoing, "Guarantor Senior Indebtedness" will not include (i) Indebtedness
evidenced by the Guarantee; (ii) Indebtedness of the Guarantor that is
subordinate or junior in right of payment to any other Indebtedness of the
Guarantor; (iii) Indebtedness of the Guarantor which, when incurred and without
respect to any other election under Section 1111(b) of the Bankruptcy Law, is
without recourse to the Guarantor; (iv) Indebtedness which is represented by
Disqualified Stock of the Guarantor; (v) any liability for foreign, federal,
state, local or other taxes owed or owing by the Guarantor; (vi) Indebtedness of
the Guarantor to a Subsidiary or any other Affiliate of the Guarantor or any of
such Affiliate's subsidiaries; (vii) that portion of any Indebtedness which,
when incurred, is issued in violation of the Indenture; and (viii) trade
payables owed or owing by the Guarantor.
"Hedging Obligations" means, with respect to any Person, the
Obligations of such Persons under (i) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements, (ii) foreign exchange
contracts, currency swap agreements or similar agreements, and (iii) other
agreements or arrangements designed to protect such Person against fluctuations,
or otherwise to establish financial hedges in respect of, exchange rates,
currency rates or interest rates.
"Holder," "holder of Securities," "Securityholders" or other similar
terms mean the registered holder of any Security.
"Indebtedness" means, with respect to any Person, (i) any indebtedness,
whether or not contingent, in respect of borrowed money or evidenced by bonds,
notes, debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or representing the deferred and unpaid balance
of the purchase price of any property (including pursuant to capital leases),
except any such balance that constitutes an accrued expense or a trade payable,
and any Hedging Obligations, if and to the extent such indebtedness (other than
a Hedging Obligation) would appear as a liability upon a balance sheet of such
Person prepared on a consolidated basis in accordance with GAAP, and also
includes, to the extent not otherwise included, the guarantee of items that
would be included within this definition; (ii) Disqualified Stock of such
Person; or (iii) Preferred Stock issued by a Restricted Subsidiary of such
Person.
"Indenture" means this Indenture as amended or supplemented from time
to time.
"Initial Purchasers" means Donaldson, Lufkin & Jenrette Securities
Corporation and Goldman, Sachs & Co.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Payment Date" means each semiannual interest payment date on
February 15 and August 15 of each year, commencing February 15, 1998.
"Interest Record Date" for the interest payable on any Interest Payment
Date (except a date for payment of defaulted interest) means the February 1 or
August 1 (whether or not a Business Day), as the case may be, immediately
preceding such Interest Payment Date.
"Investment" means any capital contribution to, or other debt or equity
investment in, any Person. For the purposes of Section 4.06, the amount of any
Investment shall be the original cost of such Investment plus the cost of all
additional Investments by the Company or any of its Restricted Subsidiaries,
without any adjustments for increases or decreases in value, or write-ups,
write-downs or write-offs with re-
16
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spect to such Investment, reduced by the payment of dividends or distributions
in connection with such Investment or any other amounts received by the Company
or any Restricted Subsidiary in respect of such Investment to the extent not
included in Consolidated Net Income.
"issue" means create, issue, assume, guarantee, incur or otherwise
become directly or indirectly liable for any Indebtedness or Capital Stock, as
applicable; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be issued
by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary.
For this definition, the terms "issuing," "issuer," "issuance" and "issued" have
meanings correlative to the foregoing.
"Issue Date" means the original issue date of the Securities, August
18, 1997.
"Legal Defeasance Option" see Section 9.02.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell and any filing of or
agreement to give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction).
"Liquidated Damages" has the meaning provided in the Registration
Rights Agreement.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP, excluding, however, any gain
or loss, together with any related provision for taxes, realized in connection
with any Asset Sale (including, without limitation, dispositions pursuant to
sale and leaseback transactions).
"Net Proceeds" means, with respect to any Asset Sale, the aggregate
amount of cash proceeds (including any cash received by way of deferred payment
pursuant to a note receivable issued in connection with such Asset Sale, other
than the portion of such deferred payment constituting interest, and including
any amounts received as disbursements or withdrawals from any escrow or similar
account established in connection with any such Asset Sale, but, in either such
case, only as and when so received) received by the Company or any of its
Restricted Subsidiaries in respect of such Asset Sale, net of: (i) the cash
expenses of such Asset Sale (including, without limitation, the payment of
principal of, and premium, if any, and interest on, Indebtedness required to be
paid as a result of such Asset Sale (other than the Securities) and legal,
accounting, management and advisory and investment banking fees and sales
commissions), (ii) taxes paid or payable as a result thereof, (iii) any portion
of cash proceeds that the Company determines in good faith should be reserved
for post-closing adjustments, it being understood and agreed that on the day
that all such post-closing adjustments have been determined, the amount (if any)
by which the reserved amount in respect of such Asset Sale exceeds the actual
post-closing adjustments payable by the Company or any of its Restricted
Subsidiaries shall constitute Net Proceeds on such date.
"New York Presenting Agent" see Section 4.02.
"Non-Global Permanent Regulation S Security" see Section 2.06.
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"Non-Restricted Subsidiary" means any Subsidiary of the Company other
than a Restricted Subsidiary.
"Non-U.S. Person" means a Person who is not a U.S. Person, as defined
in Regulation S.
"Obligations" means, with respect to any Indebtedness, all principal,
interest, premiums, penalties, fees, indemnities, expenses (including legal fees
and expenses), reimbursement obligations and other liabilities payable to the
holder of such Indebtedness under the documentation governing such Indebtedness,
and other claims of such holder arising in respect of such Indebtedness.
"Officer" means the Chairman, the Vice Chairman, the President, any
Vice President, the Chief Financial Officer, or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by two Officers or
by an Officer and an Assistant Treasurer or Assistant Secretary of the Company
complying with Sections 13.04 and 13.05.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"Other Company Indebtedness Guarantee" see Section 4.20.
"Other Permitted Indebtedness" means (i) Indebtedness of the Company
and its Restricted Subsidiaries existing as of the date of original issuance of
the Series A Securities and all related Obligations as in effect on such date;
(ii) Indebtedness of the Company and its Restricted Subsidiaries in respect of
bankers acceptances and letters of credit (including, without limitation,
letters of credit in respect of workers' compensation claims) issued in the
ordinary course of business, or other Indebtedness in respect of
reimbursement-type obligations regarding workers' compensation claims; (iii)
Refinancing Indebtedness; provided that: (A) the principal amount of such
Refinancing Indebtedness shall not exceed the outstanding principal amount of
Indebtedness (including unused commitments) extended, refinanced, renewed,
replaced, substituted or refunded plus any amounts incurred to pay premiums,
fees and expenses in connection therewith, and (B) the Refinancing Indebtedness
shall have a Weighted Average Life to Maturity equal to or greater than the
Weighted Average Life to Maturity of the Indebtedness being extended,
refinanced, renewed, replaced, substituted or refunded; (iv) intercompany
Indebtedness of and among the Company and its wholly owned Restricted
Subsidiaries (excluding guarantees by Restricted Subsidiaries of Indebtedness of
the Company not issued in compliance with Section 4.20); (v) Indebtedness of any
Non-Restricted Subsidiary created after the Issue Date; provided that such
Indebtedness is nonrecourse to the Company and its Restricted Subsidiaries and
the Company and its Restricted Subsidiaries have no Obligations with respect to
such Indebtedness; (vi) Indebtedness of the Company and its Restricted
Subsidiaries under Hedging Obligations; (vii) Indebtedness of the Company and
its Restricted Subsidiaries arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts, which will not be, and will not be
deemed to be, inadvertent) drawn against insufficient funds in the ordinary
course of business; (viii) guarantees by a Restricted Subsidiary of Indebtedness
of the Company if the Indebtedness so guaranteed is permitted under the
Indenture and the Securities are guaranteed by such Restricted Subsidiary to the
extent required by Section 4.20; (ix) Indebtedness of the Company and its
Restricted Subsidiaries in connection with performance, surety, statutory,
appeal or similar bonds in the ordinary course of business; and (x) intercompany
Indebtedness of the Company to the Guarantor; provided such Indebtedness does
not bear interest.
"Owner Securities Certification" see Section 2.01.
18
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"Paying Agent" see Section 2.03.
"Payment Blockage Notice" see Section 8.02(a).
"Payment Blockage Period" see Section 8.02(a).
"Permanent Regulation S Global Security" see Section 2.01.
"Permitted Liens" means with respect to the Company and its Restricted
Subsidiaries, (i) Liens for taxes, assessments, governmental charges or claims
which are being contested in good faith by appropriate proceedings promptly
instituted and diligently conducted and if a reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor; (ii) statutory Liens of landlords and carriers', warehousemen's,
mechanics', suppliers', materialmen's, repairmen's or other like Liens arising
in the ordinary course of business and with respect to amounts not yet
delinquent or being contested in good faith by appropriate proceedings, if a
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor; (iii) Liens incurred on
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security; (iv)
Liens incurred on deposits made to secure the performance of tenders, bids,
leases, statutory obligations, surety and appeal bonds, government contracts,
performance and return of money bonds and other obligations of a like nature
incurred in the ordinary course of business (exclusive of obligations for the
payment of borrowed money); (v) easements, rights-of-way, zoning or other
restrictions, minor defects or irregularities in title and other similar charges
or encumbrances not interfering in any material respect with the business of the
Company or any of its Restricted Subsidiaries incurred in the ordinary course of
business; (vi) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods; (vii) judgment and attachment Liens not giving rise to an
Event of Default; (viii) leases or subleases granted to others not interfering
in any material respect with the business of the Company or any of its
Restricted Subsidiaries; (ix) Liens securing Indebtedness under Hedging
Obligations; (x) Liens encumbering deposits made to secure obligations arising
from statutory, regulatory, contractual or warranty requirements; (xi) Liens
arising out of consignment or similar arrangements for the sale of goods entered
into by the Company or its Restricted Subsidiaries in the ordinary course of
business; (xii) Liens arising from filing Uniform Commercial Code financing
statements regarding leases; (xiii) Liens existing on the date of original
issuance of the Securities and any extensions, refinancings, renewals,
replacements, substitutions or refundings thereof; (xiv) any Lien granted to the
Trustee and any substantially equivalent Lien granted to any trustee or similar
institution under any indenture for Senior Indebtedness permitted by the terms
of the Indenture; (xv) Liens securing Senior Indebtedness or Indebtedness of a
Restricted Subsidiary if such Indebtedness is incurred pursuant to the Credit
Agreement or is permitted to be incurred pursuant to paragraph (a) of Section
4.04; (xvi) Liens securing Indebtedness of the Company and its Restricted
Subsidiaries in connection with capital leases, sale and leaseback transactions,
purchase money obligations, capital expenditures or similar financing
transactions, which Indebtedness is permitted under Section 4.04 or 4.19; (xvii)
Liens on property existing at the time of acquisition thereof by the Company or
a Restricted Subsidiary of the Company; provided that such Liens were in
existence prior to the contemplation of such acquisition; and (xviii) additional
Liens at any one time outstanding in respect of properties or assets where
aggregate fair market value does not exceed $2,000,000 (the fair market value to
be determined on the date such Lien is granted on such properties or assets).
"Person" means any individual, corporation, limited liability company,
limited or general partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
19
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"Preferred Stock" of any Person means Capital Stock of such Person of
any class or classes (however designated) that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of such Person, to shares of Capital
Stock of any other class of such Person.
"principal" of a debt security means the principal of the security,
plus, when appropriate, the premium, if any, on the security.
"Private Placement Legend" means the legend initially set forth on the
Securities in the form set forth on Exhibit A hereto.
"Pro Forma Basis" means, for purposes of determining Consolidated Net
Income in connection with the Cash Flow Coverage Ratio (including in connection
with Sections 4.06, 4.17 and 5.01, the incurrence of Indebtedness pursuant to
paragraph (a) of Section 4.04 and Consolidated Net Worth for purposes of Section
5.01), giving pro forma effect to (x) any acquisition or sale of a Person,
business or asset, related incurrence, repayment or refinancing of Indebtedness
or other related transactions, including any Restructuring Charges which would
otherwise be accounted for as an adjustment permitted by Regulation S-X under
the Securities Act or on a pro forma basis under GAAP, or (y) any incurrence,
repayment or refinancing of any Indebtedness and the application of the proceeds
therefrom, in each case, as if such acquisition or sale and related
transactions, restructurings, consolidations, cost savings, reductions,
incurrence, repayment or refinancing were realized on the first day of the
relevant period permitted by Regulation S-X under the Securities Act or on a pro
forma basis under GAAP. Furthermore, in calculating the Cash Flow Coverage
Ratio, (1) interest on outstanding Indebtedness determined on a fluctuating
basis as of the determination date and which will continue to be so determined
thereafter shall be deemed to have accrued at a fixed rate per annum equal to
the rate of interest on such Indebtedness in effect on the determination date;
(2) if interest on any Indebtedness actually incurred on the determination date
may optionally be determined at an interest rate based upon a factor of a prime
or similar rate, a eurocurrency interbank offered rate, or other rates, then the
interest rate in effect on the determination date will be deemed to have been in
effect during the relevant period; and (3) notwithstanding clause (1) above,
interest on Indebtedness determined on a fluctuating basis, to the extent such
interest is covered by agreements relating to interest rate swaps or similar
interest rate protection Hedging Obligations, shall be deemed to accrue at the
rate per annum resulting after giving effect to the operation of such
agreements.
"Purchase Agreement" means the Purchase Agreement dated August 11, 1997
between the Company, the Guarantor and the Initial Purchasers.
"Qualified Institutional Buyer" or "QIB" means a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act.
"Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture.
"redemption price," when used with respect to any Security to be
redeemed, means the price fixed for such redemption pursuant to this Indenture
as set forth in the form of Security annexed hereto as Exhibit A.
"Refinancing Indebtedness" means Indebtedness of the Company and its
Restricted Subsidiaries issued or given in exchange for, or the proceeds of
which are used to, extend, refinance, renew, replace,
20
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substitute for or refund the Securities or Indebtedness contemplated by clause
(i) of the definition of Other Permitted Indebtedness or any Indebtedness issued
to so extend, refinance, renew, replace, substitute for or refund such
Indebtedness.
"Registered Exchange Offer" means the offer to exchange the Series B
Securities for all of the outstanding Series A Securities in accordance with the
Registration Rights Agreement.
"Register" see Section 2.03.
"Registrar" see Section 2.03.
"Registration" means the registration of the Registered Exchange Offer
by the Company and the Guarantor or other registration of the Securities under
the Securities Act pursuant to and in accordance with the terms of the
Registration Rights Agreement.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of August 18, 1997 between the Company, the Guarantor and the Initial
Purchasers.
"Registration Statement" means the registration statement(s) as defined
and described in the Registration Rights Agreement.
"Regulation S" means Regulation S under the Securities Act.
"Restricted Global Security" see Section 2.01.
"Restricted Investment" means any Investment in any Person; provided
that Restricted Investments will not include: (i) Investments in marketable
securities and other negotiable instruments permitted by the Indenture; (ii)
Investments in the Company; (iii) Investments in any Restricted Subsidiary or in
a Person that becomes a Restricted Subsidiary as a result of such investment
(provided that any Investment in a Restricted Subsidiary or in a Person that
becomes a Restricted Subsidiary is made for fair market value (as determined by
the Board of Directors in good faith)); or (iv) Investments which exist on the
Issue Date. The amount of any Restricted Investment shall be the amount of cash
and the fair market value at the time of transfer of all other property (as
determined by the Board of Directors in good faith) initially invested or paid
for such Restricted Investment, plus all additions thereto, without any
adjustments for increases or decreases in value of or write-ups, write-downs or
write-offs with respect to, such Restricted Investment.
"Restricted Payments" see Section 4.06.
"Restricted Period" see Section 2.01.
"Restricted Security" has the meaning set forth in Rule 144(a)(3) under
the Securities Act; provided, that the Trustee shall be entitled to request and
conclusively rely upon an Opinion of Counsel with respect to whether any
Security is a Restricted Security
"Restricted Subsidiary" means: (i) any Subsidiary of the Company
existing on the Issue Date, and (ii) any other Subsidiary of the Company formed,
acquired or existing after the Issue Date that is designated as a "Restricted
Subsidiary" by the Company pursuant to a resolution approved by a majority of
the Board of Directors; provided, however, that the term Restricted Subsidiary
shall not include any Subsidiary of
21
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the Company that has been redesignated by the Company pursuant to a resolution
approved by a majority of the Board of Directors as a Non-Restricted Subsidiary
in accordance with Section 4.17 unless such Subsidiary shall have subsequently
been redesignated a Restricted Subsidiary in accordance with clause (ii) of this
definition.
"Restructuring Charges" means any charges or expenses in respect of
restructuring or consolidating any business, operations or facilities, any
compensation or headcount reduction, or any other cost savings, of any Persons
or businesses either alone or together with the Company or any Restricted
Subsidiary, as permitted by GAAP or Regulation S-X under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act.
"Securities" means, collectively, the Series A Securities and the
Series B Securities, which should be treated as a single class of securities, as
amended or supplemented from time to time in accordance with the terms of this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated by the Commission thereunder.
"Senior Indebtedness" means the principal of, premium, if any, and
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on any Indebtedness of the Company, whether outstanding on the Issue Date or
thereafter created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
not be senior in right of payment to the Securities. Without limiting the
generality of the foregoing, "Senior Indebtedness" shall also include the
principal of, premium, if any, interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law) on, and all other amounts owing in respect
of, all monetary obligations (including guarantees thereof) of every nature of
the Company under the Credit Agreement, including, without limitation,
obligations to pay principal and interest, reimbursement obligations under
letters of credit, fees, expenses and indemnities and the guarantee of any
obligations owing by any Subsidiary under the Credit Agreement. "Senior
Indebtedness" shall not include (i) any Indebtedness of the Company to a
Subsidiary of the Company, (ii) Indebtedness to, or guaranteed on behalf of, any
shareholder, director, officer or employee of either the Company or any
Subsidiary of the Company (including, without limitation, amounts owed for
compensation), (iii) Indebtedness to trade creditors and other amounts incurred
in connection with obtaining goods, materials or services, (iv) Indebtedness
represented by Disqualified Stock, (v) any liability for federal, state, local
or other taxes owed or owing by the Company, (vi) that portion of any
Indebtedness incurred in violation of the Indenture provisions set forth in
Section 4.04 and (vii) any Indebtedness which is, by its express terms,
subordinated in right of payment to any other Indebtedness of the Company.
"Series A Securities" means the 9 3/8% Senior Subordinated Notes due
2007 of the Company issued pursuant to this Indenture and sold pursuant to the
Purchase Agreement.
"Series B Securities" means the 9 3/8% Senior Subordinated Notes due
2007 of the Company to be issued in exchange for the Series A Securities
pursuant to the Registered Exchange Offer and the Registration Rights Agreement.
22
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"Services Agreement" means the Services Agreement dated as of July 31,
1997 between the Company and the Guarantor.
"Significant Subsidiary" means any Restricted Subsidiary of the Company
that would be a "significant subsidiary" as defined in clause (2) of the
definition of such term in Rule 1-02 of Regulation S-X under the Securities Act
and the Exchange Act.
"Subsidiary" of any Person means any entity of which the Equity
Interests entitled to cast at least a majority of the votes that may be cast by
all Equity Interests having ordinary voting power for the election of directors
or other governing body of such entity are owned by such Person (regardless of
whether such Equity Interests are owned directly by such Person or through one
or more Subsidiaries).
"Temporary Regulation S Global Security" see Section 2.01.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code
Sections 77aaa-77bbbb), as amended, as in effect on the date of this
Indenture, except as provided in Section 10.03.
"Transferred Securities Certification" see Section 2.06(g).
"Trust Officer" means any officer within the corporate trust department
(or any successor group) of the Trustee including any vice president, assistant
vice president, assistant secretary or any other officer or assistant officer of
the Trustee customarily performing functions similar to those performed by the
persons who at that time shall be such officers, and also means, with respect to
a particular corporate trust matter, any other officer to whom such trust matter
is referred because of his knowledge of and familiarity with the particular
subject.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York.
"U.S. Government Obligations" means direct non-callable obligations of
the United States of America for the payment of which the full faith and credit
of the United States is pledged.
"U.S. Person" means a "U.S. person" as defined in Rule 902 under the
Securities Act.
"Voting Stock" means any class or classes of Capital Stock pursuant to
which the holders thereof have the general voting power under ordinary
circumstances to elect the board of directors.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the then
outstanding principal amount of such Indebtedness into (ii) the sum of the
product(s) obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
23
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SECTION 1.02. Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company or any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule and
not otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles
in effect from time to time, and any other reference in this Indenture to
"generally accepted accounting principles" refers to GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the
plural include the singular;
(5) provisions apply to successive events and transactions; and
(6) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision.
24
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ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Trustee's certificate of authentication with
respect thereto shall be substantially in the form of Exhibit A or Exhibit B
hereto, as the case may be. The Securities may have notations, legends or
endorsements (including notations relating to the Guarantee) required by law,
stock exchange rule or usage. The Company and the Trustee shall approve the form
of the Securities and any notation, legend or endorsement (including notations
relating to the Guarantee) on them. Each Security shall be dated the date of its
authentication, shall bear interest from the applicable date which shall be
payable on each Interest Payment Date as long as such Security is outstanding
and shall be payable on the Final Maturity Date.
The terms and provisions contained in the Securities shall constitute,
and are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
Securities offered and sold in their initial distribution to Qualified
Institutional Buyers in reliance on Rule 144A or in offshore transactions in
reliance on Regulation S may, unless the applicable Holder requests Securities
in the form of physical, certificated Securities in registered form
("Certificated Securities"), which shall be substantially in the form of Exhibit
A, be initially issued in the form of Global Securities in fully registered form
without interest coupons, substantially in the form of Exhibit A, with such
applicable legends as are provided for in Exhibit A and Exhibit C.
Securities offered and sold in their initial distribution to Qualified
Institutional Buyers in reliance on Rule 144A shall be issued in the form of one
or more Global Securities (collectively, and together with their successor
securities, the "Restricted Global Security") which shall be registered in the
name of the Depository or its nominee and deposited with the Trustee, as
custodian for the Depository, duly executed by the Company and authenticated by
the Trustee as hereinafter provided, for credit by the Depository to the
respective accounts of beneficial owners of the Securities represented thereby
(or such other accounts as they may direct). The aggregate principal amount of
the Restricted Global Security may be increased or decreased from time to time
by adjustments made on the records of the Trustee, as custodian for the
Depository, in connection with a corresponding decrease or increase in the
aggregate principal amount of the Temporary Regulation S Global Security or the
Permanent Regulation S Global Security, as hereinafter provided in Section 2.06.
Securities offered and sold in reliance on Regulation S shall initially
be in the form of temporary Global Securities which shall be registered in the
name of the Depository or its nominee and deposited with the Trustee, as
custodian for the Depository, duly executed by the Company and authenticated by
the Trustee as hereinafter provided, for credit by the Depository to the
respective accounts of the beneficial owners of the Securities represented
thereby (or such other accounts as they may direct), provided that upon such
deposit all such Securities shall be credited to or through accounts maintained
at the Depository by or on behalf of Euroclear or CEDEL. Until such time as the
Restricted Period (as defined below) shall have expired, such temporary Global
Securities, together with their successor securities which are Global Securities
other than the Restricted Global Security, shall be referred to herein as a
"Temporary Regulation S Global Security." After such time as the Restricted
Period shall have expired and the certifications referred to below in the next
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succeeding paragraph shall have been provided, interests in such Temporary
Regulation S Global Securities shall be exchanged (as initiated by the
beneficial owners of interests therein) for interests in like Global Securities,
referred to herein collectively as the "Permanent Regulation S Global Security,"
or for interests in like Certificated Securities, referred to herein
collectively as the "Non-Global Permanent Regulation S Security," each
substantially in the form of Security set forth in Exhibit A, with such
applicable legends as are provided for in Exhibit A or Exhibit C. Such Permanent
Regulation S Global Securities shall be registered in the name of the Depository
or its nominee and deposited with the Trustee, as custodian for the Depository,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided, for credit to the respective accounts of the beneficial owners of the
Securities represented thereby (or such other accounts as they may direct). The
aggregate principal amount of the Temporary Regulation S Global Security or the
Permanent Regulation S Global Security may be increased or decreased from time
to time by adjustments made on the records of the Trustee, as custodian for the
Depository, as hereinafter provided. As used herein, the term "Restricted
Period" means the period of 40 days commencing on the day after the latest of
(a) the day on which the Securities are first offered to persons other than
distributors (as defined in Regulation S) in reliance on Regulation S and (b)
the date of this Indenture; provided that promptly after the occurrence of the
date described in clause (a), the Company shall give written notice thereof to
the Trustee, identifying therein the day on which the Restricted Period expires.
Interests in a Temporary Regulation S Global Security may be exchanged
for interests in a Permanent Regulation S Global Security only after (a) the
expiration of the Restricted Period, (b) delivery by a beneficial owner of an
interest therein to Euroclear or CEDEL of a written certification (an "Owner
Securities Certification") substantially in the form of Exhibit E hereto, and
(c) upon delivery by Euroclear or CEDEL to the Trustee of a written
certification (a "Depository Securities Certification") substantially in the
form attached hereto as Exhibit F. Upon receipt by the Trustee of the Depository
Securities Certification and the notification from the Depository described in
clause (iv) of the next succeeding paragraph, the Trustee will exchange the
portion of the Temporary Regulation S Global Security covered by such
certification for interests in a Permanent Regulation S Global Security. The
delivery by such Holder of a beneficial interest in such Temporary Regulation S
Global Security of such certification shall constitute an irrevocable
instruction by such holder to Euroclear or CEDEL, as the case may be, to
exchange such Holder's beneficial interest in the Temporary Regulation S Global
Security for a beneficial interest in the Permanent Regulation S Global Security
upon the expiration of the Restricted Period in accordance with the next
succeeding paragraph.
Upon:
(i) the expiration of the Restricted Period;
(ii) receipt by Euroclear or CEDEL, as the case may be, of Owner
Securities Certifications described in the preceding paragraph;
(iii) receipt by the Depository of:
(1) written instructions given in accordance with the
Applicable Procedures from an Agent Member directing the Depository to
credit or cause to be credited to a specified Agent Member's account a
beneficial interest in a Permanent Regulation S Global Security in a
principal amount equal to that of the beneficial interest in a
corresponding Temporary Regulation S Global Security for which the
necessary certifications have been delivered; and
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(2) a written order given in accordance with the Applicable
Procedures containing information regarding the account of the Agent
Member, and the Euroclear or CEDEL account for which such Agent
Member's account is held, to be credited with, and the account of the
Agent Member to be debited for, such beneficial interest; and
(iv) receipt by the Trustee of notification from the Depository in
accordance with the Applicable Procedures requesting the exchange of a
principal amount of the Temporary Regulation S Global Security identified
therein for the same amount of the Permanent Regulation S Global Security
and from Euroclear or CEDEL, as the case may be, of Depository Securities
Certifications,
the Trustee, as Registrar, shall, or shall instruct the Depository to, reduce
the principal amount of such Temporary Regulation S Global Security, and to
increase the principal amount of such Permanent Regulation S Global Security, by
the principal amount of the beneficial interest in such Temporary Regulation S
Global Security to be so transferred, and the Depository shall credit or cause
to be credited to the account of the person specified in such instructions a
beneficial interest in such Permanent Regulation S Global Security having a
principal amount equal to the amount by which the principal amount of such
Temporary Regulation S Global Security was reduced upon such transfer.
SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall sign, or
one Officer shall sign and one Officer or an Assistant Secretary (each of whom
shall, in each case, have been duly authorized by all requisite corporate
actions) shall attest to, the Securities for the Company by manual or facsimile
signature.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless. Each
execution of a Security by the Company shall be accompanied by the execution of
a Guarantee by the Guarantor (and by any Restricted Subsidiary that guarantees
Indebtedness of the Company pursuant to Section 4.20).
A Security shall not be valid until an authorized signatory 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) Series A Securities for original
issue in the aggregate principal amount not to exceed $100,000,000 and (ii)
Series B Securities from time to time only in exchange for a like principal
amount of Series A Securities, in each case upon a written order of the Company
in the form of an Officers' Certificate. The Officers' Certificate shall specify
the amount of Securities to be authenticated, the series of Securities and the
date on which the Securities are to be authenticated. The aggregate principal
amount of Securities outstanding at any time may not exceed $100,000,000, except
as provided in Section 2.07. Upon receipt of a written order of the Company in
the form of an Officers' Certificate, the Trustee shall authenticate Securities
in substitution for Securities originally issued to reflect any name change of
the Company.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
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Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company and Affiliates of the Company.
The Securities shall be issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency where (a) Securities may
be presented or surrendered for registration of transfer or for exchange
("Registrar"), (b) Securities may be presented or surrendered for payment
("Paying Agent") and (c) notices and demands in respect of the Securities and
this Indenture may be served. The Registrar shall keep a register (the
"Register") of the Securities and of their transfer and exchange. The Company,
upon notice to the Trustee, may appoint one or more co-Registrars and one or
more additional Paying Agents. The term "Paying Agent" includes any additional
Paying Agent. Except as provided herein, the Company, or any Subsidiary may act
as Paying Agent, Registrar or co-Registrar.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which shall incorporate the provisions of
the TIA. The agreement shall implement the provisions of this Indenture that
relate to such Agent. The Company shall notify the Trustee of the name and
address of any such Agent. If the Company fails to maintain a Registrar or
Paying Agent, or fails to give the foregoing notice, the Trustee shall act as
such and shall be entitled to appropriate compensation in accordance with
Section 7.07.
The Company initially appoints the Trustee as Registrar and Paying
Agent until such time as the Trustee has resigned or a successor has been
appointed.
SECTION 2.04. Paying Agent to Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all assets held by the Paying Agent for the payment of
principal of or premium, if any, or interest or Liquidated Damages, if any, on
the Securities, and shall notify the Trustee of any Default by the Company in
making any such payment. The Company at any time may require a Paying Agent to
distribute all assets held by it to the Trustee and account for any assets
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
distribute all assets held by it to the Trustee and to account for any assets
distributed. Upon distribution to the Trustee of all assets that shall have been
delivered by the Company to the Paying Agent (if other than the Company), the
Paying Agent shall have no further liability for such assets. If the Company,
any Subsidiary or any of their respective Affiliates acts as Paying Agent, it
shall, on or before each due date of the principal of or interest on the
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal or premium, if any, or, interest
or Liquidated Damages, if any, so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure so to act.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Company
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shall furnish to the Trustee before each Interest Record Date and at such other
times as the Trustee may request in writing a list as of such date and in such
form as the Trustee may reasonably require of the names and addresses of
Holders, which list may be conclusively relied upon by the Trustee.
SECTION 2.06 Transfer and Exchange.
(a) Beneficial interests in a Global Security may, subject to the
restrictions on the transferability of the Securities set forth herein and upon
delivery of a certificate in the form of Exhibit D, be exchanged for
Certificated Securities upon request but only upon at least 20 days' prior
written notice given to the Trustee by or on behalf of the Depository (in
accordance with the Depository's customary procedures) and will bear the
applicable legends set forth in Exhibit A. The Company shall duly execute and
deliver to the Trustee upon request Certificated Securities for such purpose (or
from time to time shall provide to the Trustee an inventory of duly executed
Certificated Securities for such purpose).
(b) If any Global Security is to be exchanged for other Securities or
cancelled in whole, it shall be surrendered by or on behalf of the Depository or
its nominee to the Trustee, as Registrar, for exchange or cancellation as
provided in this Article Two. If any Global Security is to be exchanged for
other Securities or cancelled in part, or if another Security is to be exchanged
in whole or in part for a beneficial interest in any Global Security, such
Global Security shall be so surrendered for exchange or cancellation as provided
in this Article Two or, if the Trustee is acting as custodian for the Depository
or its nominee (or is party to a similar arrangement) with respect to such
Global Security, the principal amount thereof shall be reduced or increased by
an amount equal to the portion thereof to be so exchanged or cancelled, or the
principal amount of such other Security to be so exchanged for a beneficial
interest therein, as the case may be, in each case by means of an appropriate
adjustment made on the records of the Trustee, whereupon the Trustee, in
accordance with the Applicable Procedures, shall instruct the Depository or its
authorized representatives to make a corresponding adjustment to its records
(including by crediting or debiting any Agent Member's account as necessary to
reflect any transfer or exchange of a beneficial interest). Upon any such
surrender or adjustment of a Global Security, the Company shall execute and the
Trustee shall, subject to this Article Two, authenticate and deliver any
Securities issuable in exchange for such Global Security (or any portion
thereof) to or upon the order of, and registered in such names as may be
directed by, the Depository or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph or in paragraph (r) below, the Company shall promptly
make available to the Trustee a reasonable supply of Securities that are not in
the form of Global Securities. The Trustee shall be entitled to rely upon any
order, direction or request of the Depository or its authorized representative
which is given or made pursuant to this Article Two if such order, direction or
request is given or made in accordance with the Applicable Procedures.
(c) Subject to the provisions in the legends required by this
Indenture, the registered Holder may grant proxies and otherwise authorize any
Person, including Agent Members and Persons who may hold interests in Agent
Members, to take any action that such Holder is entitled to take under this
Indenture.
(d) Neither Agent Members nor any other Person on whose behalf Agent
Members may act shall have any rights under this Indenture with respect to any
Global Security held on their behalf by the Depository or under the Global
Security, and the Depository may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of such Global
Security for all purposes whatsoever. Nothing herein shall prevent the Company,
the Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository
or impair, as between the Depository and its Agent Members, the operation of
customary practices governing the
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exercise of the rights of a Holder of any Security. With respect to any Global
Security deposited with the Trustee as custodian for the Depository for credit
to their respective accounts (or to such other accounts as they may direct) at
Euroclear or CEDEL, the provisions of the "Operating Procedures of the Euroclear
System" and the "Terms and Conditions Governing Use of Euroclear," and the
"Management Regulations" and "Instructions to Participants" of CEDEL,
respectively, shall be applicable to such Global Security.
(e) Upon presentation for transfer or exchange of any Security at the
office of the Trustee, as Registrar, or at the office of the New York Presenting
Agent located in The City of New York, accompanied by a written instrument of
transfer or exchange in the form approved by the Company (it being understood
that, until notice to the contrary is given to holders of Securities, the
Company shall be deemed to have approved the form of instrument of transfer or
exchange, if any, printed on any Security), executed by the registered Holder,
in person or by such Holder's attorney thereunto duly authorized in writing, and
upon compliance with this Section 2.06, such Security shall be transferred upon
the Register, and a new Security shall be authenticated and issued in the name
of the transferee. Notwithstanding any provision to the contrary herein or in
the Securities, transfers of a Global Security, in whole or in part, and
transfers of interests therein of the kind described in this Section 2.06, shall
only be made in accordance with this Section 2.06. Transfers and exchanges
subject to this Section 2.06 shall also be subject to the other provisions of
this Indenture that are not inconsistent with this Section 2.06.
(f) General. A Global Security may not be transferred, in whole or in
part, to any Person other than the Depository or a nominee thereof, and no such
transfer to any such other Person may be registered; provided, however, that
this paragraph (f) shall not prohibit any transfer of a Security that is issued
in exchange for a Global Security but is not itself a Global Security. No
transfer of a Security to any Person shall be effective under this Indenture or
the Securities unless and until such Security has been registered in the name of
such Person. Nothing in this paragraph (f) shall prohibit or render ineffective
any transfer of a beneficial interest in a Global Security effected in
accordance with the other provisions of this Section 2.06.
(g) Temporary Regulation S Global Security. If the holder of a
beneficial interest in a Temporary Regulation S Global Security wishes at any
time to transfer such interest to a Person who wishes to take delivery thereof
in the form of a beneficial interest in such Temporary Regulation S Global
Security, such transfer may be effected, subject to the rules and procedures of
the Depository, Euroclear and CEDEL, in each case to the extent applicable and
as in effect from time to time (the "Applicable Procedures"), only in accordance
with this paragraph (g). In order to effect such a transfer, the transferring
beneficial owner of an interest in a Temporary Regulation S Global Security
shall deliver to Euroclear or CEDEL, as the case may be, an Owner Securities
Certification, and the transferee of such beneficial interest in the Temporary
Regulation S Global Security shall deliver to Euroclear or CEDEL, as the case
may be, a written certification (a "Transferee Securities Certification")
substantially in the form of Exhibit G hereto.
(h) Restricted Global Security to Temporary Regulation S Global
Security. If the holder of a beneficial interest in the Restricted Global
Security wishes at any time to transfer such interest to a Person who wishes to
take delivery thereof in the form of a beneficial interest in the Temporary
Regulation S Global Security, such transfer may be effected, subject to the
Applicable Procedures, only in accordance with the provisions of this paragraph
(h) and paragraph (n) below. Upon receipt by the Trustee, as Registrar, of (A)
written instructions given by or on behalf of the Depository in accordance with
the Applicable Procedures directing the Trustee to credit or cause to be
credited to a specified Agent Member's account a beneficial interest in the
Temporary Regulation S Global Security in a specified principal amount and to
cause to be debited from another specified Agent Member's account a beneficial
interest in the Restricted Global Security in an equal principal amount and (B)
a certificate in substantially the form set forth in Exhibit H signed by or on
behalf of
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the holder of such beneficial interest in the Restricted Global Security, the
Trustee, as Registrar, shall, subject to paragraph (n) below, reduce the
principal amount of the Restricted Global Security, and increase the principal
amount of the Temporary Regulation S Global Security by such specified principal
amount.
(i) Restricted Global Security to Permanent Regulation S Global
Security. If the holder of a beneficial interest in the Restricted Global
Security wishes at any time after the expiration of the Restricted Period to
transfer such interest to a Person who wishes to take delivery thereof in the
form of a beneficial interest in the Permanent Regulation S Global Security,
such transfer may be effected, subject to the Applicable Procedures, only in
accordance with this paragraph (i). Upon receipt by the Trustee, as Registrar,
after the expiration of the Restricted Period of (A) written instructions given
by or on behalf of the Depository in accordance with the Applicable Procedures
directing the Trustee to credit or cause to be credited to a specified Agent
Member's account a beneficial interest in the Permanent Regulation S Global
Security in a specified principal amount and to cause to be debited from another
specified Agent Member's account a beneficial interest in the Restricted Global
Security in an equal principal amount and (B) a certificate in substantially the
form set forth in Exhibit I signed by or on behalf of the holder of such
beneficial interest in the Restricted Global Security, the Trustee, as
Registrar, shall reduce the principal amount of a Restricted Global Security and
increase the principal amount of the Permanent Regulation S Global Security by
such specified principal amount. Beneficial interests in the Restricted Global
Security may not be transferred to the Permanent Regulation S Global Security
prior to expiration of the Restricted Period.
(j) Temporary Regulation S Global Security or Permanent Regulation S
Global Security to Restricted Global Security. If the holder of a beneficial
interest in the Temporary Regulation S Global Security or the Permanent
Regulation S Global Security at any time wishes to transfer such interest to a
Person who wishes to take delivery thereof in the form of a beneficial interest
in the Restricted Global Security, such transfer may be effected, subject to the
Applicable Procedures, only in accordance with this paragraph (j) and paragraph
(n) below; provided that with respect to any transfer of a beneficial interest
in a Temporary Regulation S Global Security, the transferor and Euroclear or
CEDEL, as the case may be, must have previously delivered an Owner Securities
Certification (to Euroclear or CEDEL, as the case may be) and a Depository
Securities Certification (to the Depository, which shall deliver such Depository
Securities Certification to the Trustee) respectively, with respect to such
beneficial interest. Upon receipt by the Trustee, as Registrar, of (A) written
instructions given by or on behalf of the Depository in accordance with the
Applicable Procedures directing the Trustee to credit or cause to be credited to
a specified Agent Member's account a beneficial interest in the Restricted
Global Security in a specified principal amount and to cause to be debited from
another specified Agent Member's account a beneficial interest in the Temporary
Regulation S Global Security or the Permanent Regulation S Global Security, as
the case may be, in an equal principal amount and (B) a certificate in
substantially the form set forth in Exhibit J signed by or on behalf of the
holder of such beneficial interest in the Temporary Regulation S Global Security
or the Permanent Regulation S Global Security, as the case may be, the Trustee,
as Registrar, shall, subject to paragraph (n) below, reduce the principal amount
of such Temporary Regulation S Global Security or Permanent Regulation S Global
Security, as the case may be, and increase the principal amount of the
Restricted Global Security by such specified principal amount.
(k) Non-Global Restricted Security to Global Security. If the holder of
a Restricted Security (other than a Global Security) wishes at any time to
transfer all or any portion of such Security to a Person who wishes to take
delivery thereof in the form of a beneficial interest in the Restricted Global
Security, the Temporary Regulation S Global Security or the Permanent Regulation
S Global Security, such transfer may be effected, subject to the Applicable
Procedures, only in accordance with this paragraph (k) and paragraph (n) below.
Upon receipt by the Trustee, as Registrar, of (A) such Restricted Security and
written instructions given by or on behalf of such Holder as provided in this
Section 2.06 directing the Trustee to credit or cause to
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be credited to a specified Agent Member's account a beneficial interest in the
Restricted Global Security, the Temporary Regulation S Global Security or the
Permanent Regulation S Global Security, as the case may be, in a specified
principal amount equal to the principal amount of the Restricted Security (or
portion thereof) to be so transferred, and (B) an appropriately completed
certificate substantially in the form set forth in Exhibit K-1 hereto, if the
specified account is to be credited with a beneficial interest in the Restricted
Global Security, or Exhibit K-2 hereto, if the specified account is to be
credited with a beneficial interest in the Temporary Regulation S Global
Security or the Permanent Regulation S Global Security, signed by or on behalf
of such Holder, then the Trustee, as Registrar, shall, subject to paragraph (n)
below, cancel such Restricted Security (and issue a new Restricted Security in
respect of any untransferred portion thereof) as provided in this Section 2.06
and increase the principal amount of the Restricted Global Security, Temporary
Regulation S Global Security or Permanent Regulation S Global Security, as the
case may be, by the specified principal amount.
(l) Non-Global Permanent Regulation S Security to Restricted Global
Security or Permanent Regulation S Global Security. If the Holder of a
Non-Global Permanent Regulation S Security wishes at any time to transfer all or
any portion of such Security to a Person who wishes to take delivery thereof in
the form of a beneficial interest in the Restricted Global Security or the
Permanent Regulation S Global Security, as the case may be, such transfer may be
effected only in accordance with this paragraph (l) and subject to the
Applicable Procedures. Upon receipt by the Trustee, as Registrar, of (A) such
Non-Global Permanent Regulation S Security and instructions given by or on
behalf of such Holder as provided in this Section 2.06 directing the Trustee to
credit or cause to be credited to a specified Agent Member's account a
beneficial interest in the Restricted Global Security or the Permanent
Regulation S Global Security, as the case may be, in a principal amount equal to
the principal amount of the Non-Global Permanent Regulation S Security (or
portion thereof) to be so transferred, and (B)(i) with respect to a transfer
which is to be delivered in the form of a beneficial interest in the Restricted
Global Security, a certificate in substantially the form set forth in Exhibit
L-1, signed by or on behalf of such Holder, and (ii) with respect to a transfer
which is to be delivered in the form of a beneficial interest in the Permanent
Regulation S Global Security, a certificate in substantially the form set forth
in Exhibit L-2, signed by or on behalf of such Holder, then the Trustee, as
Registrar, shall, subject to paragraph (n) below, cancel such Non-Global
Permanent Regulation S Security (and issue a new Non-Global Permanent Regulation
S Security in respect of any untransferred portion thereof) as provided in this
Section 2.06 and increase the principal amount of the Restricted Global Security
or the Permanent Regulation S Global Security, as the case may be, by the
specified principal amount.
(m) Other Exchanges. Securities that are not Global Securities may be
exchanged (on transfer or otherwise) for Securities that are not Global
Securities or for beneficial interests in a Global Security (if any is then
outstanding) only in accordance with such procedures, which shall be
substantially consistent with the provisions of paragraphs (f) through (l) above
(including the certification requirements intended to insure that transfers of
beneficial interests in a Global Security comply with Rule 144A under the
Securities Act, Rule 144 under the Securities Act or Regulation S, as the case
may be) and any Applicable Procedures, as may be from time to time adopted by
the Company and the Trustee. The Trustee shall be entitled to request and
receive, from time to time, instructions as to such procedures adopted or
approved by the Company.
(n) Interests in Temporary Regulation S Global Security to be Held
Through Euroclear or CEDEL. Until the expiration of the Restricted Period,
beneficial interests in any Temporary Regulation S Global Security may be held
only in or through accounts maintained at the Depository by Euroclear or CEDEL
(or by Agent Members acting for the account thereof).
(o) When Certificated Securities are presented to the Registrar or a
co-Registrar with a request to register the transfer of such Certificated
Securities or to exchange such Certificated Securities for an
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equal principal amount of Certificated Securities of other authorized
denominations, the Registrar or co-Registrar shall register the transfer or make
the exchange as requested if its requirements for such transaction are met;
provided, however, that the Securities surrendered for transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing. To
permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Certificated Securities at the Registrar's or
co-Registrar's request. No service charge shall be made for any registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any transfer tax or similar governmental charge payable in connection
therewith (other than any such transfer taxes or similar governmental charge
payable upon exchanges or transfers pursuant to Sections 2.02, 2.10, 3.06, 4.05,
4.14 or 10.05). The Registrar or co-Registrar shall not be required to register
the transfer of or exchange of any Security (i) during a period between (a) the
date the Trustee receives notice of a redemption from the Company and the date
the Securities to be redeemed are selected by the Trustee or (b) an Interest
Record Date and the next succeeding Interest Payment Date or (ii) selected for
redemption in whole or in part pursuant to Article Three hereof, except the
unredeemed portion of any Security being redeemed in part, or tendered pursuant
to an offer therefor.
(p) If a Series A Security is a Restricted Security and a Certificated
Security, then as provided in this Indenture and subject to the limitations
herein set forth, the Holder, provided it is a Qualified Institutional Buyer,
may exchange such Security for a Book-Entry Security by instructing the Trustee
(by completing the Transferee Certificate in the form of Exhibit D hereto) to
arrange for such Series A Note to be represented by a beneficial interest in a
Global Security in accordance with the customary procedures of the Depository.
(q) Upon any exchange provided for in Section 2.06(a), the Company
shall execute and the Trustee shall authenticate and deliver to the person
specified by the Depository a new Certificated Security registered in such names
and in such authorized denominations as the Depository, pursuant to the
instructions of the beneficial owner of the Securities requesting the exchange,
shall instruct the Trustee. Thereupon, the beneficial ownership of such Global
Security shown on the records maintained by the Depository or its nominee shall
be reduced by the amounts so exchanged and an appropriate endorsement shall be
made by or on behalf of the Trustee on the Global Security. Any such exchange
shall be effected through the Depository in accordance with the procedures of
the Depository therefor.
(r) Notwithstanding the foregoing, no Global Security shall be
registered for transfer or exchange, or authenticated and delivered in the name
of a person other than the Depository for such Global Security or its nominee
until (i) the Depository notifies the Company that it is unwilling or unable to
continue as Depository for such Global Security or if at any time the Depository
ceases to be a clearing agency registered under the Exchange Act, and a
successor depository is not appointed by the Company within 30 days, (ii) the
Company executes and delivers to the Trustee a Company Order that all such
Global Securities shall be exchangeable or (iii) there shall have occurred and
be continuing an Event of Default. Upon the occurrence in respect of any Global
Security representing the Series A Securities of any one or more of the
conditions specified in clause (i), (ii) or (iii) of the preceding sentence,
such Global Security may be registered for transfer or exchange for Series A
Notes registered in the names of, authenticated and delivered to, such persons
as the Trustee or the Depository, as the case may be, shall direct.
(s) Except as provided above, any Security authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu of, any Global
Security shall also be a Global Security and bear the legend specified in
Exhibit C.
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(t) Neither the Trustee, the Registrar or any Paying Agent shall have
any responsibility or liability for the accuracy of the books and records of, or
for any actions or omissions of, the Depository, Euroclear, CEDEL or any Agent
Member.
(u) Notwithstanding anything contained herein to the contrary, neither
the Trustee nor the Registrar shall be responsible for ascertaining whether any
transfer complies with the registration provisions of or exemptions from the
Securities Act, applicable state securities laws, ERISA, the Code or the
Investment Company Act; provided, however, that if a certificate is specifically
required by the express terms of this Section 2.06 to be delivered to a Trustee
by a purchaser or transferee of a Note, the Trustee shall be under a duty to
receive and examine the same to determine whether it conforms on its face to the
requirements of this Indenture and shall promptly notify the party delivering
the same if such certificate does not conform.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a replacement
Security if the Company's and the Trustee's requirements for replacement of
Securities are met. Such Holder must provide an indemnity bond or other
indemnity, sufficient in the judgment of both the Company and the Trustee, to
protect the Company, the Trustee and any Agent from any loss which any of them
may suffer if a Security is replaced and evidence to their satisfaction of the
apparent loss, destruction or theft of such Security. The Company may charge
such Holder for its reasonable out-of-pocket expenses in replacing a Security,
including reasonable fees and expenses of counsel.
Every replacement Security is an additional obligation of the Company.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those canceled by it, those delivered
to it for cancellation and those described in this Section 2.08 as not
outstanding. Subject to Section 2.09, a Security does not cease to be
outstanding because the Company or any of its Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section
2.07.
If on a Redemption Date or the Final Maturity Date the Paying Agent
holds money sufficient to pay all of the principal and interest due on the
Securities payable on that date, then on and after that date such Securities
cease to be outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company, the Guarantor or any of their respective Affiliates shall be
disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that a Trust Officer of the Trustee actually knows are so owned shall
be disregarded.
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The Trustee may require an Officers' Certificate listing Securities
owned by the Company, the Guarantor or, to the knowledge of the Officers signing
such Officers' Certificate, their respective Affiliates.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate upon receipt of a Company Order pursuant to Section 2.02 definitive
Securities in exchange for temporary Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for transfer, exchange or payment. The
Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent,
and no one else, shall cancel all Securities surrendered for transfer, exchange,
payment or cancellation and deliver to the Company such canceled Securities for
disposal. Subject to Section 2.07, the Company may not issue new Securities to
replace Securities that it has paid or delivered to the Trustee for
cancellation. If the Company or the Guarantor shall acquire any of the
Securities, such acquisition shall not operate as a redemption or satisfaction
of the Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of principal of or interest on the
Securities, it shall pay interest on overdue principal and on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the rate per annum borne by the Securities, to the
extent lawful.
SECTION 2.13. CUSIP Number.
The Company in issuing the Securities will use a "CUSIP" number, and
the Trustee shall use the CUSIP number 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 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 shall
promptly notify the Trustee of any changes in CUSIP numbers.
SECTION 2.14. Deposit of Moneys.
Prior to 10:00 a.m. New York City time on each Interest Payment Date,
Redemption Date and the Final Maturity Date, the Company shall deposit with the
Paying Agent in immediately available funds money sufficient to make cash
payments, if any, due on such Interest Payment Date, Redemption Date or Final
Maturity Date, as the case may be, in a timely manner which permits the Paying
Agent to remit payment to the Holders on such Interest Payment Date, Redemption
Date or Final Maturity Date, as the case may be.
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ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company wants to redeem Securities pursuant to paragraph 6 or 7
of the Securities at the applicable redemption price set forth therein, it shall
notify the Trustee in writing of the Redemption Date and the principal amount of
Securities to be redeemed. The Company shall give such notice to the Trustee at
least 45 days before the Redemption Date (unless a shorter notice shall be
agreed to by the Trustee in writing), together with an Officers' Certificate
stating that such redemption will comply with the conditions contained herein.
SECTION 3.02. Selection of Securities to Be Redeemed.
If less than all of the Securities are to be redeemed pursuant to
paragraph 6 of the Securities, the Trustee shall select the Securities to be
redeemed in compliance with the requirements of the national securities
exchange, if any, on which the Securities are listed or, if the Securities are
not then listed on a national securities exchange, on a pro rata basis, by lot
or by any other method as the Trustee shall deem fair and appropriate. Selection
of the Securities to be redeemed pursuant to paragraph 7 of the Securities shall
be made by the Trustee only on a pro rata basis or on as nearly a pro rata basis
as is practicable (subject to the procedures of the Depository) based on the
aggregate principal amount of Securities held by each Holder. The Trustee shall
make the selection from the Securities then outstanding, subject to redemption
and not previously called for redemption.
The Trustee may select for redemption pursuant to paragraph 6 or 7 of
the Securities portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000 principal
amount or integral multiples thereof. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail to each Holder
at such Holder's registered address whose Securities are to be redeemed.
Each notice of redemption shall identify the Securities to be redeemed
(including, but subject to the provisions of Section 2.13, the CUSIP number
thereon) and shall state:
(i) the Redemption Date;
(ii) the redemption price;
(iii) the name and address of the Paying Agent to which the Securities
are to be surrendered for redemption;
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(iv) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(v) that, unless the Company defaults in making the redemption payment,
interest on Securities called for redemption ceases to accrue on and after
the Redemption Date and the only remaining right of the Holders is to
receive payment of the redemption price upon surrender to the Paying Agent;
and
(vi) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the
Redemption Date, upon surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion thereof will
be issued.
At the Company's request, the Trustee shall give the notice of
redemption on behalf of the Company, in the Company's name and at the Company's
expense.
SECTION 3.04. Effect of Notice of Redemption.
Once a notice of redemption is mailed, Securities called for redemption
become due and payable on the Redemption Date and at the redemption price
specified in such notice. Upon surrender to the Paying Agent, such Securities
shall be paid at the redemption price, plus accrued interest thereon, if any, to
the Redemption Date, but interest installments whose maturity is on or prior to
such Redemption Date shall be payable to the Holders of record at the close of
business on the relevant Interest Record Date.
SECTION 3.05. Deposit of Redemption Price.
At least one Business Day before the Redemption Date, the Company shall
deposit with the Paying Agent (or if the Company is its own Paying Agent, shall,
on or before the Redemption Date, segregate and hold in trust) money sufficient
to pay the redemption price of and accrued interest and Liquidated Damages, if
any, on all Securities to be redeemed on that date other than Securities or
portions thereof called for redemption on that date which have been delivered by
the Company to the Trustee for cancellation.
If any Security surrendered for redemption in the manner provided in
the Securities shall not be so paid on the Redemption Date due to the failure of
the Company to deposit with the Paying Agent money sufficient to pay the
redemption price thereof, the principal and accrued and unpaid interest, if any,
thereon shall, until paid or duly provided for, bear interest as provided in
Sections 2.12 and 4.01 with respect to any payment default.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Trustee
shall authenticate for the Holder a new Security equal in principal amount to
the unredeemed portion of the Security surrendered.
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ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and premium, if any, and
interest and Liquidated Damages, if any, on the Securities in the manner
provided in the Securities and the Registration Rights Agreement. An installment
of principal, premium, interest or Liquidated Damages shall be considered paid
on the date due if the Trustee or Paying Agent (other than the Company, a
Subsidiary or an Affiliate of the Company) holds on that date money designated
for and sufficient to pay the installment in full and is not prohibited from
paying such money to the Holders of the Securities pursuant to the terms of this
Indenture. The Trustee shall not be responsible for knowing the amount of
Liquidated Damages due unless the Trustee shall have been notified by the
Company thereof.
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, as provided in Section 2.12.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee, Registrar or
co-registrar) where Securities may be surrendered for payment or for
registration of transfer or exchange and where notices and demands to or upon
the Company in respect of the Securities and this Indenture may be presented
(the "New York Presenting Agent"). The Company may also from time to time
designate one or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in the Borough of Manhattan, The City of New York for such
purposes. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 13.02 hereof. The Company hereby initially
designates State Street Bank and Trust Company, N.A., at its address at 61
Broadway, 15th Floor, New York, New York 10006, as its office or agency in The
Borough of Manhattan, The City of New York, for such purposes.
SECTION 4.03. Transactions with Affiliates.
(a) The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, make any loan, advance, guarantee or
capital contribution to, or for the benefit of, or sell, lease, transfer or
dispose of any properties or assets to, or for the benefit of, or purchase or
lease any property or assets from, or enter into or amend any contract,
agreement or understanding with, or for the benefit of, an Affiliate (each such
transaction or series of related transactions that are part of a common plan are
referred to as an "Affiliate Transaction"), except in good faith and on terms
that are no less favorable to the Company or the relevant Restricted Subsidiary
than those that would have been obtained in a comparable transaction on an arm's
length basis from an unrelated person.
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(b) The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any Affiliate Transaction involving aggregate payments
or other transfers by the Company and its Restricted Subsidiaries in excess of
$3,500,000 (including cash and non-cash payments and benefits valued at their
fair market value by the Board of Directors in good faith) unless the Company
delivers to the Trustee:
(i) a resolution of the Board of Directors stating that the Board of
Directors (including a majority of the disinterested directors, if any) has,
in good faith, determined that such Affiliate Transaction complies with the
provisions of the Indenture, and
(ii) (A) with respect to any Affiliate Transaction involving the
incurrence of Indebtedness, a written opinion of a nationally recognized
investment banking or accounting firm experienced in the review of similar
types of transactions, (B) with respect to any Affiliate Transaction
involving the transfer of real property, fixed assets or equipment, either
directly or by a transfer of 50% or more of the Capital Stock of a
Restricted Subsidiary which holds any such real property, fixed assets or
equipment, a written appraisal from a nationally recognized appraiser,
experienced in the review of similar types of transactions or (C) with
respect to any Affiliate Transaction not otherwise described in (A) and (B)
above, a written certification from a nationally recognized professional or
firm experienced in evaluating similar types of transactions, in each case,
stating that the terms of such transaction are fair to the Company or such
Restricted Subsidiary, as the case may be, from a financial point of view.
(c) Notwithstanding paragraphs (a) and (b) of this Section 4.03, this
Section 4.03 shall not apply to: (i) transactions between the Company and any
wholly owned Restricted Subsidiary or between wholly owned Restricted
Subsidiaries; (ii) transactions permitted by Section 4.06; (iii) compensation
paid to officers, employees or consultants of the Company or any subsidiary as
determined in good faith by the Board of Directors or executives; or (iv)
transactions between the Company and the Guarantor or between the Company and a
Subsidiary of the Guarantor in the ordinary course of business on terms
substantially consistent with past practice.
SECTION 4.04. Limitation on Incurrence of Indebtedness.
(a) The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, issue any Indebtedness (other than the
Indebtedness represented by the Securities) unless the Company's Cash Flow
Coverage Ratio for its four full fiscal quarters next preceding the date such
additional Indebtedness is issued would have been at least 2.0 to 1 on or prior
to August 31, 1999 and at least 2.25 to 1 thereafter determined on a Pro Forma
Basis (including, for this purpose, any other Indebtedness incurred since the
end of the applicable four-quarter period) as if such additional Indebtedness
and any other Indebtedness issued since the end of such four-quarter period had
been issued at the beginning of such four-quarter period.
(b) The foregoing limitations will not apply to the issuance of:
(i) Indebtedness of the Company and/or its Restricted Subsidiaries
under the Credit Agreement as measured on such date of issuance in an
aggregate principal amount outstanding on any such date of issuance not
exceeding the greater of (x) the sum of (A) 75% of the book value of the
accounts receivable of the Company and its Restricted Subsidiaries on a
consolidated basis and (B) 60% of the book value of the inventory of the
Company and its Restricted Subsidiaries on a consolidated basis or (y)
$50,000,000;
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(ii) Indebtedness of the Company and its Restricted Subsidiaries in
connection with capital leases, purchase money obligations, capital
expenditures or similar financing transactions relating to their properties,
assets and rights up to $10,000,000 in aggregate principal amount;
(iii) additional Indebtedness of the Company and its Restricted
Subsidiaries in an aggregate principal amount of up to $10,000,000; and
(iv) Other Permitted Indebtedness.
(c) Notwithstanding paragraphs (a) and (b) of this Section 4.04, no
Restricted Subsidiary shall under any circumstances issue a guarantee of any
Indebtedness of the Company except for guarantees issued by Restricted
Subsidiaries pursuant to Section 4.20; provided, however, that the foregoing
will not limit or restrict guarantees issued by Restricted Subsidiaries in
respect of Indebtedness of other Restricted Subsidiaries.
SECTION 4.05. Limitation on Certain Asset Sales.
(a) The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, consummate an Asset Sale (including the
sale of any of the Capital Stock of any Restricted Subsidiary) providing for Net
Proceeds in excess of $5,000,000 unless the Net Proceeds from such Asset Sale
are applied (in any manner otherwise permitted by this Indenture) to one or more
of the following purposes in such combination as the Company shall elect: (i) an
investment in another asset or business in the same line of business as, or a
line of business similar to that of, the line of business of the Company and its
Restricted Subsidiaries at the time of the Asset Sale; provided that such
investment occurs on or prior to the 365th day following the date of such Asset
Sale (the "Asset Sale Disposition Date"), (ii) to reimburse the Company or its
Subsidiaries for expenditures made, and costs incurred, to repair, rebuild,
replace or restore property lost, damaged or taken to the extent that the Net
Proceeds consist of insurance proceeds received on account of such loss, damage
or taking, (iii) the purchase, redemption or other prepayment or repayment of
outstanding Senior Indebtedness or Indebtedness of the Company's Restricted
Subsidiaries on or prior to the 365th day following the Asset Sale Disposition
Date or (iv) an Asset Sale Offer expiring on or prior to the Asset Sale Purchase
Date. The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, consummate an Asset Sale unless at least
70% of the consideration therefor received by the Company or such Restricted
Subsidiary is in the form of cash, cash equivalents or marketable securities;
provided that, solely for purposes of calculating such 70% of the consideration,
the amount of (x) any liabilities (as shown on the Company's or such Restricted
Subsidiary's most recent balance sheet or in the notes thereto, excluding
contingent liabilities and trade payables) of the Company or any Restricted
Subsidiary (other than liabilities that are by their terms subordinated to the
Securities) that are assumed by the transferee of any such assets and (y) any
notes or other obligations received by the Company or any such Restricted
Subsidiary from such transferee that are promptly, but in no event more than 30
days after receipt, converted by the Company or such Restricted Subsidiary into
cash (to the extent of the cash received), shall be deemed to be cash and cash
equivalents for purposes of this provision. Any Net Proceeds from any Asset Sale
that are not applied or invested as provided in the first sentence of this
paragraph shall constitute "Excess Proceeds."
(b) When the aggregate amount of Excess Proceeds exceeds $6,500,000
(such date being an "Asset Sale Trigger Date"), the Company shall make an Offer
(an "Asset Sale Offer") to all holders of Securities to purchase the maximum
principal amount of the Securities then outstanding that may be purchased out of
Excess Proceeds, at an offer price in cash in an amount equal to 100% of
principal amount thereof plus any accrued and unpaid interest to the date (the
"Asset Sale Purchase Date") the Securities tendered are purchased
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and paid for in accordance with this Section 4.05. Within 30 days following any
Asset Sale Trigger Date, the Company shall mail a notice to each holder of
Securities at such holder's registered address stating:
(i) that an Asset Sale Offer is being made pursuant to an Asset Sale
Trigger Date, the length of time the Asset Sale Offer shall remain open and
the maximum principal amount of Securities that will be accepted for payment
pursuant to such Asset Sale Offer;
(ii) the purchase price, the amount of accrued and unpaid interest as
of the Asset Sale Purchase Date and the Asset Sale Purchase Date (which
shall be no earlier than 30 days and no later than 60 days from the date
such notice is mailed);
(iii) that any Security or portion thereof not tendered or accepted for
payment will continue to accrue interest;
(iv) that any Security accepted for payment pursuant to the Asset Sale
Offer shall cease to accrue interest on and after the Asset Sale Purchase
Date;
(v) that Holders electing to have a Security purchased pursuant to the
Asset Sale Offer will be required to surrender the Security, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Security
completed, to a Paying Agent at the address specified in the notice at least
three Business Days before the Asset Sale Purchase Date;
(vi) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the third
Business Day before the Asset Sale Purchase Date, a facsimile transmission
or letter setting forth the name of the Holder, the principal amount of the
Security the Holder delivered for purchase and a statement that such Holder
is withdrawing his election to have the Security purchased;
(vii) that, if the aggregate principal amount of Securities surrendered
by Holders exceeds the Excess Proceeds, the Trustee shall select the
Securities to be purchased on a pro rata basis, by lot or by any other
method that the Trustee considers fair and appropriate and, if the
Securities are listed on any securities exchange, by a method that complies
with the requirements of such exchange; provided that, if less than all of a
holder's Securities are to be redeemed or accepted for payment, only
principal amounts of $1,000 or integral multiples thereof may be selected
for redemption or accepted for payment;
(viii) that Holders whose Securities were purchased only in part will
be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered; and
(ix) a brief description of the circumstances and relevant facts
regarding such Asset Sale.
On the Asset Sale Purchase Date, the Company will, to the extent
required by this Indenture and the Asset Sale Offer, (1) accept for payment the
maximum principal amount of Securities or portions thereof tendered pursuant to
the Asset Sale Offer that can be purchased out of Excess Proceeds, (2) deposit
with the Paying Agent the aggregate purchase price of all Securities or portions
thereof accepted for payment and any accrued and unpaid interest on such
Securities as of the Asset Sale Purchase Date, and (3) deliver or cause to be
delivered to the Trustee all Securities tendered pursuant to the Asset Sale
Offer. The Paying
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Agent shall promptly mail to each holder of Securities or portions thereof
accepted for payment an amount equal to the purchase price for such Securities
plus any accrued and unpaid interest thereon, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book-entry) to such holder
of Securities accepted for payment in part a new Security equal in principal
amount to any unpurchased portion of the Securities and any Security not
accepted for payment in whole or in part shall be promptly returned to the
holder thereof. The Company will publicly announce the results of the Asset Sale
Offer on or as soon as practicable after the Asset Sale Purchase Date.
The Company will comply with any tender offer rules under the Exchange
Act which may then be applicable, including Rule 14e-1, in connection with an
Asset Sale offer. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Indenture, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Indenture by virtue thereof.
Notwithstanding the foregoing, to the extent that any or all of the Net
Proceeds of an Asset Sale are prohibited or delayed by applicable local law from
being repatriated to the United States, the portion of such Net Proceeds so
affected will not be required to be applied as described in this Section 4.05,
but may be retained for so long, but only for so long, as the applicable local
law prohibits repatriation to the United States.
To the extent that any Excess Proceeds remain after completion of an
Asset Sale Offer, the Company may use such remaining amount for general
corporate purposes. Upon completion of an Asset Sale Offer, the amount of Excess
Proceeds shall be reset at zero.
SECTION 4.06. Limitation on Restricted Payments.
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, (i) declare or pay any dividend or make
any distribution on account of the Company's or such Restricted Subsidiary's
Capital Stock or other Equity Interests (other than dividends or distributions
payable in Capital Stock or other Equity Interests (other than Disqualified
Stock) of the Company and dividends or distributions payable by a Restricted
Subsidiary to a Restricted Subsidiary or to the Company); (ii) purchase, redeem
or otherwise acquire or retire for value any Capital Stock or other Equity
Interests of the Company or any of its Restricted Subsidiaries; (iii) make any
principal payment on, purchase, defease, redeem, prepay, decrease or otherwise
acquire or retire for value, prior to any scheduled final maturity, scheduled
repayment or scheduled sinking fund payment, any Indebtedness of the Company
that is subordinate or junior in right of payment to the Notes; or (iv) make any
Restricted Investment (all such dividends, distributions, purchases,
redemptions, acquisitions, retirements, prepayments and Restricted Investments
being collectively referred to as "Restricted Payments"), if, at the time of
such Restricted Payment:
(a) a Default or Event of Default shall have occurred and be continuing
or shall occur as a consequence thereof; or
(b) immediately after such Restricted Payment and after giving pro
forma effect thereto, the Company shall not be able to issue $1.00 of
additional Indebtedness pursuant to paragraph (a) of Section 4.04; or
(c) such Restricted Payment, together with the aggregate of all other
Restricted Payments made after the date of original issuance of the
Securities, without duplication, exceeds the sum of
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(1) 50% of the aggregate Consolidated Net Income (including, for this
purpose, gains or losses from Asset Sales) of the Company (or, in case such
aggregate is a loss, 100% of such loss) for the period (taken as one
accounting period) from the beginning of the fiscal quarter commencing March
1, 1997 and ended as of the Company's most recently ended fiscal quarter at
the time of such Restricted Payment; plus (2) 100% of the aggregate net cash
proceeds and the fair market value of any property or securities (as
determined by the Board of Directors in good faith) received by the Company
from the issue or sale of Capital Stock or other Equity Interests of the
Company subsequent to the date of original issuance of the Securities (other
than (x) Capital Stock or other Equity Interests issued or sold to a
Restricted Subsidiary and (y) the issuance or sale of Disqualified Stock);
plus (3) the amount by which the principal amount of and any accrued
interest on either (A) Indebtedness of the Company or (B) any Indebtedness
of any Restricted Subsidiary is reduced on the Company's consolidated
balance sheet upon the conversion or exchange other than by a Restricted
Subsidiary subsequent to the date of original issuance of the Securities of
any Indebtedness of the Company or any Restricted Subsidiary (not held by
the Company or any Restricted Subsidiary) for Capital Stock or other Equity
Interests (other than Disqualified Stock) of the Company (less the amount of
any cash, or the fair market value of any other property or securities (as
determined by the Board of Directors in good faith), distributed by the
Company or any Restricted Subsidiary (to Persons other than the Company or
any other Restricted Subsidiary) upon such conversion or exchange); plus (4)
if any Non-Restricted Subsidiary is redesignated as a Restricted Subsidiary,
the value of the Restricted Payment that would result if such Subsidiary
were redesignated as a Non-Restricted Subsidiary at such time, as determined
in accordance with Section 4.17(b); provided, however, that for purposes of
this clause (4), the value of any redesignated Non-Restricted Subsidiary
shall be reduced by the amount that any such redesignation replenishes or
increases the amount of Restricted Investments permitted to be made pursuant
to paragraph (ii) of the next sentence.
Notwithstanding the foregoing, paragraphs (b) and (c) shall not
prohibit as Restricted Payments:
(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at said date of declaration, such payment would
comply with all covenants of this Indenture (including, but not limited to,
this Section 4.06); provided that payments made pursuant to this paragraph
shall count as a Restricted Payment for purposes of the calculation in
paragraph (c) of this Section 4.06;
(ii) the payment by the Company of a dividend to the Guarantor on the
date of issuance of the Securities from the proceeds received from the
issuance of the Securities not to exceed $72 million in cash; provided that
payments made pursuant to this paragraph (ii) shall not count as a
Restricted Payment for purposes of the calculation in paragraph (c) of this
Section 4.06;
(iii) any payment by the Company of a dividend to the Guarantor on the
date of issuance of the Securities or prior to the Issue Date in an amount
equal to the intercompany receivable on such date from the Guarantor;
provided that payments made pursuant to this paragraph (iii) shall not count
as a Restricted Payment for purposes of the calculation in paragraph (c) of
this Section 4.06;
(iv) the redemption, repurchase, retirement or other acquisition of any
Capital Stock or other Equity Interests of the Company or any Restricted
Subsidiary in exchange for, or out of the proceeds of, the substantially
concurrent sale (other than to a Subsidiary of the Company) of other Capital
Stock or other Equity Interests of the Company (other than any Disqualified
Stock) or the re-
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demption, repurchase, retirement or other acquisition of any Capital
Stock or other Equity Interests of any Restricted Subsidiary in exchange
for, or out of the proceeds of, the substantially concurrent sale (other
than to the Company or a Subsidiary of the Company) of other Capital Stock
or other Equity Interests of such Restricted Subsidiary; provided that, in
each case, any net cash proceeds that are utilized for any such redemption,
repurchase, retirement or other acquisition, and any Net Income resulting
therefrom, shall be excluded from paragraph (c) of this Section 4.06;
(v) Restricted Investments made or received in connection with the
sale, transfer or disposition of any business, properties or assets of the
Company or any Restricted Subsidiary; provided that, if such sale, transfer
or disposition constitutes an Asset Sale, the Company complies with the
provisions of the Section 4.05, and such Restricted Investments shall not
count as a Restricted Payment for purposes of the calculation in paragraph
(c) of this Section 4.06;
(vi) the payment of a dividend to the Guarantor in order to allow the
Guarantor to pay its regular quarterly dividend in respect of the
Guarantor's Convertible Preferred Stock, Common Stock, Class A Stock and
Class B Stock; provided that payments made pursuant to this paragraph (vi)
shall count as a Restricted Payment for purposes of the calculation in
paragraph (c) of this Section 4.06;
(vii) cash dividends or loans from the Company to the Guarantor
pursuant to the Services Agreement but in no event exceeding 4% of the
revenues of the Company and its Restricted Subsidiaries for the immediately
preceding four fiscal quarters; provided, that payments made pursuant to
this paragraph (vii) shall not count as a Restricted Payment for purposes of
the calculation paragraph (c) of this Section 4.06;
(viii) payments to the Guarantor in an amount equal to the amount of
income tax that the Company would have paid had it filed consolidated tax
returns on a separate company basis in any given tax year; provided that
payments made pursuant to this paragraph (viii) shall not count as a
Restricted Payment for purposes of the calculation in paragraph (c) of this
Section 4.06; and
(ix) $3,000,000; provided that payments made pursuant to this paragraph
(ix) shall count as a Restricted Payment for purposes of the calculation in
paragraph (c) of this Section 4.06.
SECTION 4.07. Corporate Existence.
Subject to Article Five, the Company and the Guarantor shall do or
shall cause to be done all things necessary to preserve and keep in full force
and effect their respective corporate existence and the corporate, partnership
or other existence of each Restricted Subsidiary in accordance with the
respective organizational documents of each of them (as the same may be amended
from time to time) and the rights (charter and statutory) and material
franchises of the Company, the Guarantor and the Restricted Subsidiaries;
provided, however, that the Company and the Guarantor shall not be required to
preserve any such right or franchise, or the corporate existence of any
Restricted Subsidiary, if the Board of Directors or the board of directors of
the Guarantor shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company, the Guarantor and the
Restricted Subsidiaries, taken as a whole, and that the loss thereof is not, and
will not be, adverse in any material respect to the Holders.
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SECTION 4.08. Payment of Taxes and Other Claims.
The Company and the Guarantor shall pay or discharge or cause to be
paid or discharged, before the same shall become delinquent, (1) all material
taxes, assessments and governmental charges levied or imposed upon the Company,
the Guarantor or any Restricted Subsidiary or upon the income, profits or
property of the Company, the Guarantor or any Restricted Subsidiary and (2) all
lawful claims for labor, materials and supplies which, in each case, if unpaid,
might by law become a material liability, or Lien upon the property, of the
Company, the Guarantor or any Restricted Subsidiary; provided, however, that
neither the Company nor the Guarantor shall be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which appropriate provision has been made.
SECTION 4.09. Notice of Defaults.
(a) In the event that any Indebtedness of the Company, the Guarantor or
any of their Subsidiaries is declared due and payable before its maturity
because of the occurrence of any default (or any event which, with notice or
lapse of time, or both, would constitute such a default) under such
Indebtedness, the Company or the Guarantor shall promptly give written notice to
the Trustee of such declaration, the status of such default or event and what
action the Company or the Guarantor is taking or proposes to take with respect
thereto.
(b) Upon becoming aware of any Default or Event of Default, the Company
or the Guarantor shall promptly deliver an Officers' Certificate to the Trustee
specifying the Default or Event of Default.
SECTION 4.10. Maintenance of Properties and Insurance.
(a) The Company and the Guarantor shall cause all material properties
owned by or leased to either of them or any Restricted Subsidiary and used or
useful in the conduct of their business or the business of any Restricted
Subsidiary to be maintained and kept in normal condition, repair and working
order and supplied with all necessary equipment and shall cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of the Company or the Guarantor may be necessary, so that
the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
Section 4.10 shall prevent the Company, the Guarantor or any Restricted
Subsidiary from discontinuing the use, operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal is,
in the judgment of the Board of Directors or of the board of directors of the
Guarantor or Restricted Subsidiary concerned, or of an officer (or other agent
employed by the Company, the Guarantor or any Restricted Subsidiary) of the
Company, the Guarantor or such Restricted Subsidiary having managerial
responsibility for any such property, desirable in the conduct of the business
of the Company, the Guarantor or any Restricted Subsidiary, and if such
discontinuance or disposal is not adverse in any material respect to the
Holders.
(b) The Company and the Guarantor shall maintain, and shall cause the
Restricted Subsidiaries to maintain, insurance with responsible carriers against
such risks and in such amounts, and with such deductibles, retentions,
self-insured amounts and co-insurance provisions, as are customarily carried by
similar businesses of similar size, including property and casualty loss, and
workers' compensation insurance.
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SECTION 4.11. Compliance Certificate.
The Company shall deliver to the Trustee within 90 days after the close
of each fiscal year a certificate signed by the principal executive officer,
principal financial officer or principal accounting officer stating that a
review of the activities of the Company has been made under the supervision of
the signing officers with a view to determining whether a Default or Event of
Default has occurred and whether or not the signers know of any Default or Event
of Default by the Company that occurred during such fiscal year. If they do know
of such a Default or Event of Default, the certificate shall describe all such
Defaults or Events of Default, their status and the action the Company is taking
or proposes to take with respect thereto.
SECTION 4.12. Provision of Financial Information.
For so long as the Securities are outstanding, whether or not the
Guarantor or any successor thereto is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Guarantor shall submit for filing
with the Commission the annual reports, quarterly reports and other documents
relating to the Guarantor and its Subsidiaries that the Guarantor would have
been required to file with the Commission pursuant to Section 13 or 15(d) if the
Guarantor were subject to such reporting requirements. The Guarantor will also
provide to all holders of Securities and file with the Trustee copies of such
annual reports, quarterly reports and other documents required to be furnished
to stockholders generally under the Exchange Act.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of the Trustee of any information contained
therein or determinable from information contained therein, including the
Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
SECTION 4.13. Waiver of Stay, Extension or Usury Laws.
The Company and the Guarantor covenants (to the extent that they may
lawfully do so) that they shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law, which would prohibit or forgive the
Company or such Guarantor from paying all or any portion of the principal of
and/or interest, if any, on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
performance of this Indenture; and (to the extent that they may lawfully do so)
each of the Company and the Guarantor hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 4.14. Change of Control.
Following the occurrence of a Change of Control (the date of such
occurrence being the "Change of Control Trigger Date"), the Company shall notify
the Holders of the Securities of such occurrence in the manner prescribed by
this Indenture and shall, within 30 days after the Change of Control Trigger
Date, make an offer (the "Change of Control Offer") to purchase all Securities
then outstanding at a purchase price in cash equal to 101% of the aggregate
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the date (the "Change of Control Purchase Date") the
Securities tendered are purchased and paid for in accordance with this Section
4.14. The Company shall furnish to the Trustee, at least 14 days before notice
of a Change of Control Offer is mailed to all holders of Securities, notice that
the
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Change of Control Offer is being made. Within 30 days following any Change of
Control Trigger Date, the Company shall mail a notice to each Holder of
Securities at such Holder's registered address stating:
(i) that a Change of Control Offer is being made pursuant to a Change
of Control Trigger Date, the length of time the Change of Control Offer
shall remain open and that all Securities tendered for payment will be
accepted for payment, and otherwise subject to the terms and conditions set
forth therein;
(ii) the purchase price, the amount of accrued and unpaid interest as
of the Change of Control Purchase Date, and the Change of Control Purchase
Date (which shall be no earlier than 30 days and no later than 60 days from
the date such notice is mailed);
(iii) that any Security not tendered will continue to accrue interest;
(iv) that any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest on and after the Change of
Control Purchase Date;
(v) that Holders accepting the Change of Control Offer will be required
to surrender the Securities to the Paying Agent specified in the notice
prior to the close of business on the third Business Day preceding the
Change of Control Purchase Date;
(vi) that Holders will be entitled to withdraw their acceptance if the
Paying Agent receives, not later than the close of business on the third
Business Day preceding the Change of Control Purchase Date, a facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Securities delivered for purchase and a statement that such
Holder is withdrawing his election to have such Securities purchased;
(vii) that Holders whose Securities are being purchased only in part
will be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered;
(viii) any other procedures that a Holder must follow to accept a
Change of Control Offer or effect withdrawal of such acceptance; and
(ix) the name and address of the Paying Agent.
On the Change of Control Purchase Date, the Company will, to the extent
required by this Indenture and the Change of Control Offer, (1) accept for
payment all Securities or portions thereof (subject to the requirement that any
portion of a Security tendered must be tendered in any integral multiple $1,000
principal amount) tendered pursuant to the Change of Control Offer; (2) deposit
with the Paying Agent the aggregate purchase price of all Securities or portions
thereof accepted for payment and any accrued and unpaid interest and Liquidated
Damages, if any, on such Securities as of the Change of Control Purchase Date,
and (3) deliver or cause to be delivered to the Trustee all Securities tendered
pursuant to the Change of Control Offer. The Paying Agent shall promptly mail to
each holder of Securities or portions thereof accepted for payment an amount
equal to the purchase price for such Securities plus any accrued and unpaid
interest and Liquidated Damages, if any, thereon, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book-entry) to such holder
of Securities accepted for payment in part a new Security equal in principal
amount to any unpurchased portion of the Securities and any Security not
accepted for payment in
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whole or in part shall be promptly returned to the holder thereof. The Company
will publicly announce the results of the Change of Control Offer on or as soon
as practicable after the Change of Control Purchase Date.
The Company will comply with any tender offer rules under the Exchange
Act which may then be applicable, including Rule 14e-1, in connection with a
Change of Control Offer. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Indenture, the Company
shall comply with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations under this Indenture by virtue
thereof.
SECTION 4.15. Limitation on Senior Subordinated Indebtedness.
The Company shall not, directly or indirectly, incur any Indebtedness
that by its terms would expressly rank senior in right of payment to the
Securities and expressly rank subordinate in right of payment to any Senior
Indebtedness.
SECTION 4.16. Limitations on Dividend and Other Payment Restrictions Affecting
Restricted Subsidiaries.
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective, any encumbrance or restriction on the ability of any
Restricted Subsidiary to (a) pay dividends or make any other distributions on
its Capital Stock or any other interest or participation in, or measured by, its
profits, owned by the Company or any Restricted Subsidiary, or pay any
Indebtedness owed to, the Company or any Restricted Subsidiary, (b) make loans
or advances to the Company, or (c) transfer any of its properties or assets to
the Company, except for such encumbrances or restrictions existing under or by
reason of:
(i) applicable law;
(ii) Indebtedness permitted (A) under paragraph (a) of Section 4.04,
(B) under clauses (i) or (iii) of paragraph (b) of Section 4.04 or clauses
(i), (v), (vi) or (viii) of the definition of Other Permitted Indebtedness,
or (C) by agreements and transactions permitted under Section 4.06;
(iii) customary provisions restricting subletting or assignment of any
lease or license of the Company or any Restricted Subsidiary;
(iv) any instrument governing Indebtedness or any other encumbrance or
restriction of a Person acquired by the Company or any Restricted Subsidiary
at the time of such acquisition, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other
than the Person, or the property or assets of the Person, so acquired;
(v) the Credit Agreement;
(vi) any Refinancing Indebtedness permitted under Section 4.04 or
clauses (i), (v) or (viii) of the definition of Other Permitted
Indebtedness; provided that the encumbrances and restrictions created in
connection with such Refinancing Indebtedness are no more restrictive in any
material respect with regard to the interests of the Holders of Securities
than the encumbrances and restrictions in the refinanced Indebtedness; or
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(vii) the terms of purchase money obligations, but only to the extent
such purchase money obligations restrict or prohibit the transfer of the
property so acquired.
Nothing contained in this Section 4.16 shall prevent the Company from
entering into any agreement or instrument providing for the incurrence of
Permitted Liens or restricting the sale or other disposition of property or
assets of the Company or any of its Restricted Subsidiaries that are subject to
Permitted Liens.
SECTION 4.17. Designation of Restricted and Non-Restricted Subsidiaries.
(a) As of the date of this Indenture, all Subsidiaries of the Company
shall be Restricted Subsidiaries. Subject to the exceptions described below,
from and after the Issue Date, the Company may designate any existing or newly
formed or acquired Subsidiary as a Non-Restricted Subsidiary; provided that
either (i) the Subsidiary to be so designated has total assets of $1,000,000 or
less or (ii) immediately before and after giving effect to such designation: (I)
the Company could incur $1.00 of additional Indebtedness pursuant to paragraph
(a) of Section 4.04 determined on a Pro Forma Basis; (II) no Default or Event of
Default shall have occurred and be continuing; (III) all Investments made by the
Company or by a Restricted Subsidiary of the Company in such Restricted
Subsidiary which is being designated a Non-Restricted Subsidiary prior to or on
the date such Restricted Subsidiary is being designated a Non-Restricted
Subsidiary shall have been permitted pursuant to Section 4.06 as if all of such
Restricted Payments had been made on the day such Restricted Subsidiary is
designated a Non-Restricted Subsidiary (to the extent not previously included as
a Restricted Payment) in the amount of the greater of (A) the fair market value
(as determined by the Board of Directors in good faith) of the Equity Interests
of such Subsidiary held by the Company and its Restricted Subsidiaries on such
date or (B) the amount of the Investments determined in accordance with GAAP
made by the Company and any of its Restricted Subsidiaries in such Restricted
Subsidiary; and (IV) all transactions between the Subsidiary to be so designated
and its Affiliates remaining in effect are permitted pursuant to Section 4.03.
(b) The Company may redesignate any Non-Restricted Subsidiary as a
Restricted Subsidiary. The Company may not, and may not permit any Restricted
Subsidiary to, take any action or enter into any transaction or series of
transactions that would result in a Person becoming a Restricted Subsidiary
(whether through an acquisition, the redesignation of a Non-Restricted
Subsidiary or otherwise, but not including through the creation of a new
Restricted Subsidiary) unless, immediately before and after giving effect to
such action, transaction or series of transactions, (i) the Company could incur
at least $1.00 of additional Indebtedness pursuant to paragraph (a) of Section
4.04 on a Pro Forma Basis and (ii) no Default or Event of Default shall have
occurred and be continuing.
(c) The designation of a Subsidiary as a Restricted Subsidiary or the
removal of such designation shall be made by a resolution adopted by a majority
of the Board of Directors stating that the Board of Directors has made such
designation in accordance with this Indenture, and the Company shall deliver to
the Trustee such resolution together with an Officers' Certificate certifying
that the designation complies with this Indenture. Such designation will be
effective as of the date specified in the applicable resolution which may not be
before the date the applicable Officers' Certificate is delivered to the
Trustee.
SECTION 4.18. Limitation on Liens.
The Company shall not, and shall not cause or permit any Restricted
Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist
any Lien (other than Permitted Liens) upon any property or asset now owned or
hereafter acquired by them, or any income or profits therefrom, or assign or
convey
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any right to receive income therefrom; provided, however, that in addition to
creating Permitted Liens on its properties or assets, the Company and any of its
Restricted Subsidiaries may create any Lien upon any of their properties or
assets (including, but not limited to, any Capital Stock of its Subsidiaries) if
the Notes are equally and ratably secured.
SECTION 4.19. Limitation on Sale and Leaseback Transactions.
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction;
provided that the Company may enter into a sale and leaseback transaction if (i)
the Company could have incurred Indebtedness in an amount equal to the
Attributable Debt relating to such sale and leaseback transaction pursuant to
the Company's Cash Flow Coverage Ratio test set forth in paragraph (a) of
Section 4.04, (ii) the net cash proceeds of such sale and leaseback transaction
are at least equal to the fair market value (as determined in good faith by the
Board of Directors and set forth in an Officers' Certificate delivered to the
Trustee) of the property that is the subject of such sale and leaseback
transaction and (iii) the transfer of assets in such sale and leaseback
transaction is permitted by, and the proceeds of such transaction are applied in
compliance with, Section 4.05.
SECTION 4.20. Limitation on Guarantees of Company Indebtedness by Restricted
Subsidiaries.
The Company shall not permit any Restricted Subsidiary, directly or
indirectly, to guarantee any Indebtedness of the Company other than the
Securities (the "Other Company Indebtedness") unless (A) such Restricted
Subsidiary contemporaneously executes and delivers a supplemental indenture to
this Indenture providing for a guarantee of payment of the Securities then
outstanding by such Restricted Subsidiary to the same extent as the guarantee of
payment (the "Other Company Indebtedness Guarantee") of the Other Company
Indebtedness (including waiver of subrogation, if any) and (B) if the Other
Company Indebtedness guaranteed by such Restricted Subsidiary is Senior
Indebtedness, the guarantee for the Securities shall be subordinated in right of
payment with the Other Company Indebtedness Guarantee; provided, however, that
the provisions of this Section 4.20 do not apply to guarantees by any Restricted
Subsidiary of the Company's Indebtedness under the Credit Agreement as in effect
on the Issue Date.
Each guarantee of the Securities created by a Restricted Subsidiary
pursuant to the provisions described in the foregoing paragraph shall be in form
and substance satisfactory to the Trustee and shall provide, among other things,
that it will be automatically and unconditionally released and discharged upon
(i) any sale, exchange or transfer permitted by this Indenture of (a) all of the
Company's Capital Stock in such Restricted Subsidiary or (b) the sale of all or
substantially all of the assets of the Restricted Subsidiary and upon the
application of the Net Proceeds from such sale in accordance with the
requirements of Section 4.05 or (ii) the release or discharge of the Other
Company Indebtedness Guarantee that resulted in the creation of such guarantee
of the Securities.
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ARTICLE FIVE
MERGERS; SUCCESSOR CORPORATION
SECTION 5.01. Mergers, Consolidation and Sale of Assets.
(a) Each of the Company and the Guarantor shall not consolidate or
merge with or into, or sell, lease, convey or otherwise dispose of all or
substantially all of its assets to, any Person (any such consolidation, merger
or sale being a "Disposition") unless: (i) the successor corporation of such
Disposition or the corporation to which such Disposition shall have been made is
a corporation organized or existing under the laws of the United States, any
state thereof or the District of Columbia; (ii) the successor corporation of
such Disposition or the corporation to which such Disposition shall have been
made expressly assumes the Obligations of the Company or the Guarantor, as the
case may be, pursuant to a supplemental indenture in a form reasonably
satisfactory to the Trustee, under this Indenture and the Securities; (iii)
immediately after such Disposition, no Default or Event of Default shall exist;
and (iv) the corporation formed by or surviving any such Disposition, or the
corporation to which such Disposition shall have been made, shall (I) have
Consolidated Net Worth (immediately after the Disposition but prior to giving
any pro forma effect to purchase accounting adjustments resulting from the
Disposition) equal to or greater than the Consolidated Net Worth of the Company
or the Guarantor, as the case may be, immediately preceding the Disposition, and
(II) be permitted immediately after the Disposition by the terms of the
Indenture to issue at least $1.00 of additional Indebtedness pursuant to
paragraph (a) of Section 4.04 determined on a Pro Forma Basis. The limitations
in this Indenture on the Company's ability to make a Disposition described in
this paragraph (a) do not restrict the Company's ability to sell less than all
or substantially all of its assets, such sales being governed by Section 4.05.
(b) Prior to the consummation of any proposed Disposition, the Company
shall deliver to the Trustee an Officers' Certificate to the foregoing effect
and an Opinion of Counsel stating that the proposed Disposition and such
supplemental indenture comply with this Indenture.
SECTION 5.02. Successor Corporation Substituted.
(a) In the event of any Disposition of the Company or the Guarantor in
accordance with Section 5.01, the successor corporation formed by such
consolidation or into which the Company or the Guarantor is merged or to which
such Disposition is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company or the Guarantor under this
Indenture with the same effect as if such successor corporation had been named
as the Company or the Guarantor herein, and thereafter the predecessor
corporation shall be relieved of all Obligations and covenants under this
Indenture and the Securities.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following shall be an "Event of Default" for purposes of
this Indenture:
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(i) a default for 30 days in payment of interest or Liquidated Damages,
if any, on the Securities;
(ii) a default in payment when due of principal or premium, if any,
with respect to the Securities;
(iii) failure by the Company to comply with the provisions of Section
4.04, 4.06, 4.14 or 5.01;
(iv) the failure of the Company to comply with any of its other
agreements or covenants in, or provisions of, this Indenture or the
Securities, which failure is not cured within thirty days after notice and
demand for cure sent to the Company by the Trustee or Holders of at least
25% of principal amount of the Securities then outstanding;
(v) a default by the Company, the Guarantor or any Restricted
Subsidiary under any mortgage, indenture or instrument under which there may
be issued or by which there may be secured or evidenced any Indebtedness for
money borrowed by the Company or any Restricted Subsidiary (or the payment
of which is guaranteed by the Company or any Restricted Subsidiary), whether
such Indebtedness or guarantee now exists or shall be created hereafter, if
(I) either (A) such default results from the failure to pay principal of or
interest on any such Indebtedness (after giving effect to any extensions
thereof) or (B) as a result of such default the maturity of such
Indebtedness has been accelerated prior to its expressed maturity, and (II)
the principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness in default for failure to pay
principal or interest thereon, or, because of the acceleration of the
maturity thereof, aggregates in excess of $2,500,000;
(vi) a failure by the Company or any Restricted Subsidiary to pay final
judgments (not covered by insurance) aggregating in excess of $2,500,000
which judgments a court of competent jurisdiction does not rescind, annul or
stay within 45 days after their entry;
(vii) the Company, the Guarantor or any Significant Subsidiary pursuant
to or within the meaning of any Bankruptcy Law: (I) commences a voluntary
case, (II) consents to the entry of an order for relief against it in an
involuntary case, (III) consents to the appointment of a Custodian of it or
for all or substantially all of its property, (IV) makes a general
assignment for the benefit of its creditors, or (V) generally is not paying
its debts as they become due; and
(viii) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that: (I) is for relief against the Company, the
Guarantor or any Significant Subsidiary in an involuntary case, (II)
appoints a Custodian of the Company, the Guarantor or any Significant
Subsidiary or for all or substantially all of the property of the Company,
the Guarantor or any Significant Subsidiary, or (III) orders the liquidation
of the Company, the Guarantor or any Significant Subsidiary, and the order
or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
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In the case of any Event of Default pursuant to paragraph (i) or (ii)
above occurring by reason of any willful action (or inactions) taken (or not
taken) by or on behalf of the Company with the intention of avoiding payment of
the premium that the Company would have to pay pursuant to a redemption of
Securities as described under Article Three, an equivalent premium shall also
become and be immediately, due and payable to the extent permitted by law.
SECTION 6.02. Acceleration.
If an Event of Default with respect to the Securities occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of the outstanding Securities may declare the unpaid principal of and
accrued interest and Liquidated Damages, if any, to the date of acceleration on
all outstanding Securities to be due and payable immediately by notice in
writing to the Company (and to the Trustee if given by the Holders) specifying
the respective Event of Default and that it is a "notice of acceleration" (the
"Acceleration Notice") and, upon any such declaration, such principal amount and
accrued interest and Liquidated Damages, if any, notwithstanding anything
contained in this Indenture or the Securities to the contrary, shall become
immediately due and payable.
A Default or Event of Default under paragraph (vii) or (viii) will
result in the Securities automatically becoming due and payable without further
action or notice.
After a declaration of acceleration, but before a judgment or decree of
the money due in respect of the Securities has been obtained, the Holders of not
less than a majority in aggregate principal amount of the Securities then
outstanding by written notice to the Trustee may rescind an acceleration and its
consequences if all existing Events of Default (other than the nonpayment of
principal of and interest and Liquidated Damages, if any, on the Securities
which has become due solely by virtue of such acceleration) have been cured or
waived and if the rescission would not conflict with any judgment or decree. No
such rescission shall affect any subsequent Default or impair any right
consequent thereto.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of or interest and Liquidated Damages, if any, on the Securities or to
enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
maturing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Default.
Subject to Sections 2.09, 6.07 and 10.02, prior to the declaration of
acceleration of the Securities, the Holders of not less than a majority in
aggregate principal amount of the outstanding Securities by written notice to
the Trustee may waive an existing Default or Event of Default and its
consequences, except a continuing Default in the payment of principal of or
premium, if any, or interest or Liquidated Damages, if any, on any Security or a
Default in respect of any term or provision of this Indenture that may not be
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amended or modified without the consent of each Holder affected as provided in
Section 10.02 (and except for any failure to pay any amount owing to the
Trustee, or waiver of any covenant or other provision for the personal
protection of the Trustee, without the Trustee's consent). The Company shall
deliver to the Trustee an Officers' Certificate stating that the requisite
percentage of Holders have consented to such waiver and attaching copies of such
consents. In case of any such waiver, the Company, the Trustee and the Holders
shall be restored to their former positions and rights hereunder and under the
Securities, respectively. This paragraph of this Section 6.04 shall be in lieu
of Section 316(a)(1)(B) of the TIA and such Section 316(a)(1)(B) of the TIA is
hereby expressly excluded from this Indenture and the Securities, as permitted
by the TIA.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred for every
purpose of this Indenture and the Securities, but no such waiver shall extend to
any subsequent or other Default or Event of Default or impair any right
consequent thereon.
SECTION 6.05. Control by Majority.
Subject to Section 2.09, the Holders of a majority in principal amount
of the outstanding Securities may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it. However, the Trustee may refuse to follow
any direction that conflicts with law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of another Securityholder, or
that may involve the Trustee in personal liability; provided, however, that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction. In the event the Trustee takes any action or
follows any direction pursuant to this Indenture, the Trustee shall be entitled
to indemnification satisfactory to it in its sole discretion against any loss or
expense caused by taking such action or following such direction. This Section
6.05 shall be in lieu of Section 316(a)(1)(A) of the TIA, and such Section
316(a)(1)(A) of the TIA is hereby expressly excluded from this Indenture and the
Securities, as permitted by the TIA.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(i) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount of the
outstanding Securities make a written request to the Trustee to pursue a
remedy;
(iii) such Holder or Holders offer and, if requested, provide to the
Trustee indemnity satisfactory to the Trustee against any loss, liability or
expense;
(iv) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(v) during such 60-day period the Holders of a majority in principal
amount of the outstanding Securities do not give the Trustee a direction
which, in the opinion of the Trustee, is inconsistent with the request.
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A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of principal of or interest or Liquidated Damages, if
any, on a Security, on or after the respective due dates expressed in the
Security, or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or premium, if any, or
interest or Liquidated Damages, if any, specified in Section 6.01(i) or (ii)
occurs and is continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company or the Guarantor or any other
obligor on the Securities for the whole amount of principal and premium, if any,
and accrued interest remaining unpaid, and Liquidated Damages, if any, together
with interest overdue on principal and to the extent that payment of such
interest is lawful, interest on overdue installments of interest, in each case
at the rate per annum borne by the Securities and such further amount as shall
be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel) and the Securityholders
allowed in any judicial proceedings relative to the Company or the Guarantor (or
any other obligor upon the Securities), any of their respective creditors or any
of their respective property and shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same, and any Custodian in any such judicial proceedings
is hereby authorized by each Securityholder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Securityholders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agent and counsel, and any other amounts due the Trustee under
Section 7.07. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money or property pursuant to this Article
Six, subject to the provisions of Articles Eight and Twelve, it shall pay out
the money or property in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for amounts due and unpaid on the Securities for
principal, premium, if any, or Liquidated Damages, if any, and interest,
ratably, without preference or priority of any kind,
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according to the amounts due and payable on the Securities for principal and
interest, respectively; and
Third: to the Company or, to the extent the Trustee collects any amount
from the Guarantor, to the Guarantor.
The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Securityholders pursuant to this
Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by
a Holder or group of Holders of more than 10% in aggregate principal amount of
the outstanding Securities, or to any suit instituted by any Holder for the
enforcement or the payment of the principal of or interest or premium or
Liquidated Damages, if any, on any Securities on or after the respective due
dates expressed in the Security.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a Default has occurred and is continuing, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture and use
the same degree of care and skill in their exercise as a prudent Person would
exercise or use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of a Default:
(1) The Trustee shall not be liable except for the performance of such
duties as are specifically set forth herein; and
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions conforming to
the requirements of this Indenture; however, in the case of any such
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall examine such
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee shall not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
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(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01;
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) The Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction received by it
pursuant to Section 6.05.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it or it does not receive from such Holders an indemnity
satisfactory to it in its sole discretion against such risk, liability, loss,
fee or expense which might be incurred by it in compliance with such request or
direction.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person. The Trustee need
not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate and/or an Opinion of Counsel, which shall conform to
the provisions of Section 13.05. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Trustee may act through attorneys and agents of its selection
and shall not be responsible for the misconduct or negligence of any agent
or attorney (other than an agent who is an employee of the Trustee)
appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it reasonably believes to be authorized or within
its rights or powers.
(e) The Trustee may consult with counsel and the advice or opinion of
such counsel as to matters of law shall be full and complete authorization
and protection from liability in respect of any action taken, omitted or
suffered by it hereunder in good faith and in accordance with the advice or
opinion of such counsel.
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(f) Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any request
or direction of the Guarantor mentioned herein shall be sufficiently
evidenced if signed by an officer of the Guarantor.
(g) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Securityholders pursuant to this Indenture, unless such
Securityholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(h) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, security, 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 the Guarantor, personally or by agent or attorney.
(i) The Trustee shall not be deemed to have notice of any Event of
Default unless a Trust Officer of the Trustee has actual knowledge thereof
or unless the Trustee shall have received written notice thereof at the
Corporate Trust Office of the Trustee, and such notice references the
Securities and this Indenture.
(j) Permissive rights or powers available to the Trustee hereunder
shall not be assumed to be mandatory duties or obligations.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee, subject to
Section 7.10 hereof. Any Agent may do the same with like rights. However, the
Trustee is subject to Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Company or the Guarantor in
this Indenture or any document issued in connection with the sale of Securities
or any statement in the Securities other than the Trustee's certificate of
authentication.
SECTION 7.05. Notice of Defaults.
The Company shall deliver to the Trustee annually a statement regarding
compliance with this Indenture and, upon an Officer of the Company becoming
aware of any Default or Event of Default, a statement specifying such Default or
Event of Default. If a Default or an Event of Default occurs and is continuing
and the Trustee knows of such Default or Event of Default, the Trustee shall
mail to each Securityholder notice of the Default or Event of Default within 90
days after the occurrence thereof. Except in the case
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of a Default or an Event of Default in payment of principal of or premium, if
any, or interest or Liquidated Damages, if any, on any Security or a Default or
Event of Default in complying with Section 5.01 hereof, the Trustee may withhold
the notice if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interest of Securityholders.
This Section 7.05 shall be in lieu of the proviso to Section 315(b) of the TIA
and such proviso to Section 315(b) of the TIA is hereby expressly excluded from
this Indenture and the Securities, as permitted by the TIA.
SECTION 7.06. Reports by Trustee to Holders.
If required by TIA Section 313(a), within 60 days after each May 15
beginning with the May 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a report dated as of such May 15 that complies
with TIA Section 313(a). The Trustee also shall comply with TIA Section 313(b),
(c) and (d).
A copy of each such report at the time of its mailing to
Securityholders shall be filed with the Commission and each stock exchange, if
any, on which the Securities are listed.
The Company shall promptly notify the Trustee in writing if the
Securities become listed on any stock exchange or of any delisting thereof.
SECTION 7.07. Compensation and Indemnity.
The Company and the Guarantor jointly and severally shall pay to the
Trustee from time to time such compensation as the Company and the Trustee shall
from time to time agree in writing for its services. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Company and the Guarantor shall reimburse the Trustee upon request
for all reasonable disbursements, expenses and advances (including fees,
disbursements and expenses of its agents and counsel) incurred or made by it in
addition to the compensation for its services except any such disbursements,
expenses and advances as may be attributable to the Trustee's negligence or bad
faith. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents, accountants, experts and counsel and any
taxes or other expenses incurred by a trust created pursuant to Section 9.01
hereof.
The Company and the Guarantor jointly and severally shall indemnify the
Trustee for, and hold it harmless against any and all loss, damage, claims,
liability or expense, including taxes (other than franchise taxes imposed on the
Trustee and taxes based upon, measured by or determined by the income of the
Trustee), arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder, except to the extent that
such loss, damage, claim, liability or expense is due to its own negligence or
bad faith. The Trustee shall notify the Company promptly of any claim asserted
against the Trustee for which it may seek indemnity. However, the failure by the
Trustee to so notify the Company shall not relieve the Company or the Guarantor
of their respective obligations hereunder. The Company and the Guarantor shall
defend the claim and the Trustee shall cooperate in the defense (and may employ
its own counsel) at the Company's and the Guarantor's expense; provided,
however, that the Company's and the Guarantor's reimbursement obligation with
respect to counsel employed by the Trustee will be limited to the reasonable
fees and expenses of such counsel.
The Company and the Guarantor need not pay for any settlement made
without their written consent, which consent shall not be unreasonably withheld.
The Company and the Guarantor need not reim-
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burse any expense or indemnify against any loss or liability incurred by the
Trustee as a result of the violation of this Indenture by the Trustee.
To secure the Company's and the Guarantor's payment obligations in this
Section 7.07, the Trustee shall have a Lien prior to the Securities against all
money or property held or collected by the Trustee, in its capacity as Trustee,
except money or property held in trust to pay principal of or premium, if any,
or interest or Liquidated Damages, if any, on particular Securities or the
purchase price or redemption price of any Securities to be purchased pursuant to
an Asset Sale Offer or Change of Control Offer or redeemed.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(vii) or (viii) occurs, the expenses (including
the reasonable fees and expenses of its agents and counsel) and the compensation
for the services shall be preferred over the status of the Holders in a
proceeding under any Bankruptcy Law and are intended to constitute expenses of
administration under any Bankruptcy Law. The Company's and the Guarantor's
obligations under this Section 7.07 and any claim arising hereunder shall
survive the resignation or removal of any Trustee, the discharge of the
Company's and the Guarantor's obligations pursuant to Article Nine and any
rejection or termination under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company in
writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Trustee and the Company in
writing and may appoint a successor Trustee with the Company's consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent under any
Bankruptcy Law;
(3) a custodian or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. As promptly as
practicable after that, the retiring Trustee shall transfer, after payment of
all sums then owing to the Trustee pursuant to Section 7.07, all property held
by it as Trustee to the successor Trustee, subject to the Lien provided in
Section 7.07, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have the rights, powers and duties of
the Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the out-
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standing Securities may petition, at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's and the Guarantor's obligations under Section 7.07 shall
continue for the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another corporation
or banking corporation, the resulting, surviving or transferee corporation or
banking corporation without any further act shall be the successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee which shall be eligible to
act as Trustee under TIA Sections 310(a)(1) and 310(a)(2). The Trustee
shall have a combined capital and surplus of at least $50,000,000 as set forth
in its most recent published annual report of condition. If the Trustee has or
shall acquire any "conflicting interest" within the meaning of TIA Section
310(b), the Trustee and the Company shall comply with the provisions of TIA
Section 310(b); provided, however, that there shall be excluded from the
operation of TIA Section 310(b)(1) any indenture or indentures under which other
securities or certificates of interest or participation in other securities of
the Company are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 7.10, the Trustee
shall resign immediately in the manner and with the effect hereinbefore
specified in this Article Seven.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE EIGHT
SUBORDINATION OF SECURITIES
SECTION 8.01. Securities Subordinated to Senior Indebtedness.
The Company and the Guarantor covenant and agree, and the Trustee and
each Holder of the Securities by his acceptance thereof likewise covenant and
agree, that all Securities shall be issued subject to the provisions of this
Article Eight; and each person holding any Security, whether upon original issue
or upon transfer, assignment or exchange thereof, accepts and agrees that all
payments of the principal of and interest and Liquidated Damages, if any, on the
Securities by the Company or the Guarantor shall, to the extent and in the
manner set forth in this Article Eight, be subordinated and junior in right of
payment to the prior payment
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in full in cash of all amounts payable under Senior Indebtedness, whether
outstanding on the date of the Indenture or thereafter incurred.
SECTION 8.02. No Payment on Securities in Certain Circumstances.
(a) No direct or indirect payment by or on behalf of the Company of
principal of or interest and Liquidated Damages, if any, on the Securities,
whether pursuant to the terms of the Securities, upon acceleration, pursuant to
an Asset Sale Offer or Change of Control Offer or otherwise, shall be made to
the Holders of Securities and instead shall be made to the Holders of Senior
Indebtedness (except that Holders of Securities may receive payments made from
the defeasance trust described under Section 9.04) if (i) a default in the
payment of the principal of or premium, if any, or interest on Senior
Indebtedness occurs and is continuing beyond any applicable period of grace or
(ii) any other default occurs and is continuing with respect to Designated
Senior Indebtedness that permits holders of the Designated Senior Indebtedness
as to which such default relates to accelerate its maturity and the Trustee
receives a written notice (with a copy to the Company) of such other default (a
"Payment Blockage Notice") from the Company or the holders of any Designated
Senior Indebtedness until all Obligations with respect to Senior Indebtedness
are paid in full; payments on the Securities shall be resumed (a) in the case of
a payment default, upon the date on which such default is cured or waived and
(b) in case of a nonpayment default, the earlier of the date on which such
nonpayment default is cured or waived or 179 days after the date on which the
applicable Payment Blockage Notice is received by the Trustee (such period being
referred to herein as the "Payment Brokerage Period"), unless the maturity of
any Designated Senior Indebtedness has been accelerated (and written notice of
such acceleration has been received by the Trustee). No nonpayment default that
existed or was continuing on the date of delivery of any Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage
Notice (it being understood that any subsequent action, or any breach of any
covenant for a period commencing after the date of receipt by the Trustee of
such Payment Blockage Notice, that, in either case, would give rise to such a
default pursuant to any provisions under which a default previously existed or
was continuing shall constitute a new default for this purpose).
Notwithstanding anything herein or in the Securities to the contrary,
(x) in no event shall a Payment Blockage Period extend beyond 179 days from the
date the Payment Blockage Notice in respect thereof was given, (y) there shall
be a period of at least 181 consecutive days in each 360-day period when no
Payment Blockage Period is in effect and (z) not more than one Payment Blockage
Period may be commenced with respect to the Securities during any period of 360
consecutive days. No event of default that existed or was continuing on the date
of commencement of any Payment Blockage Period with respect to the Designated
Senior Indebtedness initiating such Payment Blockage Period (to the extent the
holder of Designated Senior Indebtedness, or trustee or agent, giving notice
commencing such Payment Blockage Period had knowledge of such existing or
continuing event of default) may be, or be made, the basis for the commencement
of any other Payment Blockage Period by the holder or holders of such Designated
Senior Indebtedness or the trustee or agent acting on behalf of the holders of
such Designated Senior Indebtedness, whether or not within a period of 360
consecutive days, unless such event of default has been cured or waived for a
period of not less than 90 consecutive days.
(b) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by
Section 8.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of Designated Senior
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Designated Senior Indebtedness
may have been issued, as their respective interests may appear, but only to the
extent that, upon notice from the Trustee to the holders of Designated Senior
Indebtedness that such prohibited
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payment has been made, the holders of the Designated Senior Indebtedness (or
their representative or representatives or a trustee) notify the Trustee in
writing of the amounts then due and owing on the Designated Senior Indebtedness,
if any, and only the amounts specified in such notice to the Trustee shall be
paid to the holders of Designated Senior Indebtedness.
SECTION 8.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any payment or distribution of assets or securities of the
Company of any kind or character, whether in cash, property or securities, upon
any dissolution or winding-up or liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership or
other similar proceedings, an assignment for the benefit of creditors or any
marshaling of the Company's assets, the holders of Senior Indebtedness shall be
entitled to receive payment in full in cash of all Obligations due in respect of
such Senior Indebtedness (including interest after the commencement of any
proceeding at the rate specified in the applicable Senior Indebtedness) before
the Holders of the Securities or the Trustee on behalf of such Holders shall be
entitled to receive any payment by the Company of the principal of or interest
or Liquidated Damages, if any, on the Securities, or any payment by the Company
to acquire any of the Securities for cash, property or securities, or any
distribution with respect to the Securities of any cash, property or securities.
Before any payment may be made by, or on behalf of, the Company of the principal
of or interest or Liquidated Damages, if any, on the Securities upon any such
dissolution or winding-up or liquidation or reorganization, any payment or
distribution of assets or securities of the Company of any kind or character,
whether in cash, property or securities, to which the Holders of the Securities
or the Trustee on their behalf would be entitled, but for the subordination
provisions of this Indenture, shall be made by the Company or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other Person making such
payment or distribution, directly to the holders of the Senior Indebtedness (pro
rata to such holders on the basis of the respective amounts of Senior
Indebtedness held by such holders) or their representatives or to the trustee or
trustees or agent or agents under any agreement or indenture pursuant to which
any of such Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all such Senior
Indebtedness in full in cash after giving effect to any prior or concurrent
payment, distribution or provision therefor to or for the holders of such Senior
Indebtedness.
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of the Company of any kind or character, whether in cash, property
or securities, shall be received by the Trustee or any Holder of Securities at a
time when such payment or distribution is prohibited by Section 8.03(a) and
before all obligations in respect of Senior Indebtedness are paid in full in
cash, or payment provided for, such payment or distribution shall be received
and held in trust for the benefit of, and shall be paid over or delivered to,
the holders of Senior Indebtedness (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders) or their
respective representatives, or to the trustee or trustees or agent or agents
under any indenture pursuant to which any of such Senior Indebtedness may have
been issued, as their respective interests may appear, for application to the
payment of Senior Indebtedness remaining unpaid until all such Senior
Indebtedness has been paid in full in cash after giving effect to any prior or
concurrent payment, distribution or provision therefor to or for the holders of
such Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company
with or into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided in Article Five shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the pur-
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poses of this Section 8.03 if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Article Five.
SECTION 8.04. Subrogation.
Upon the payment in full in cash of all Senior Indebtedness, or
provision for payment, the Holders of the Securities shall be subrogated to the
rights of the holders of Senior Indebtedness to receive payments or
distributions of cash, property or securities of the Company made on such Senior
Indebtedness until the principal of and interest and Liquidated Damages, if any,
on the Securities shall be paid in full in cash; and, for the purposes of such
subrogation, no payments or distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the Holders of the
Securities or the Trustee on their behalf would be entitled except for the
provisions of this Article Eight, and no payment over pursuant to the provisions
of this Article Eight to the holders of Senior Indebtedness by Holders of the
Securities or the Trustee on their behalf shall, as between the Company, its
creditors other than holders of Senior Indebtedness, and the Holders of the
Securities, be deemed to be a payment by the Company to or on account of the
Senior Indebtedness. It is understood that the provisions of this Article Eight
are and are intended solely for the purpose of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
If any payment or distribution to which the Holders of the Securities
would otherwise have been entitled but for the provisions of this Article Eight
shall have been applied, pursuant to the provisions of this Article Eight, to
the payment of all amounts payable under Senior Indebtedness, then and in such
case, the Holders of the Securities shall be entitled to receive from the
holders of such Senior Indebtedness any payments or distributions received by
such holders of Senior Indebtedness in excess of the amount required to make
payment in full, or provision for payment, of such Senior Indebtedness.
SECTION 8.05. Obligations of Company Unconditional.
Nothing contained in this Article Eight or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as between the Company and
the Holders of the Securities, the obligation of the Company, which is absolute
and unconditional, to pay to the Holders of the Securities the principal of and
interest and Liquidated Damages, if any, on the Securities as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders of the Securities and
creditors of the Company other than the holders of the Senior Indebtedness, nor
shall anything herein or therein prevent the Holder of any Security or the
Trustee on their behalf from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if any,
under this Article Eight of the holders of the Senior Indebtedness in respect of
cash, property or securities of the Company received upon the exercise of any
such remedy.
Without limiting the generality of the foregoing, nothing contained in
this Article Eight shall restrict the right of the Trustee or the Holders of
Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Senior Indebtedness then due
and payable shall first be paid in full before the Holders of the Securities or
the Trustee are entitled to receive any direct or indirect payment from the
Company of principal of or interest or Liquidated Damages, if any, on the
Securities.
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SECTION 8.06. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Securities pursuant to the provisions of this Article
Eight. The Trustee shall not be charged with knowledge of the existence of any
event of default with respect to any Senior Indebtedness or of any other facts
which would prohibit the making of any payment to or by the Trustee unless and
until the Trustee shall have received notice in writing at its Corporate Trust
Office to that effect signed by an Officer of the Company, or by a holder of
Senior Indebtedness or trustee or agent therefor; and prior to the receipt of
any such written notice, the Trustee shall, subject to Article Seven, be
entitled to assume that no such facts exist; provided that if the Trustee shall
not have received the notice provided for in this Section 8.06 at least two
Business Days prior to the date upon which by the terms of this Indenture any
moneys shall become payable for any purpose (including, without limitation, the
payment of the principal of or interest or Liquidated Damages, if any, on any
Security), then, regardless of anything herein to the contrary, the Trustee
shall have full power and authority to receive any moneys from the Company and
to apply the same to the purpose for which they were received, and shall not be
affected by any notice to the contrary which may be received by it on or after
such prior date. Nothing contained in this Section 8.06 shall limit the right of
the holders of Senior Indebtedness to recover payments as contemplated by
Section 8.03. The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself or itself to be a holder of any
Senior Indebtedness (or a trustee on behalf of, or other representative of, such
holder) to establish that such notice has been given by a holder of such Senior
Indebtedness or a trustee or representative on behalf of any such holder.
In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness to participate in any payment or distribution pursuant to
this Article Eight, the Trustee may request such Person to furnish evidence to
the reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article Eight, and if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
SECTION 8.07. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets or securities referred to in
this Article Eight, the Trustee and the Holders of the Securities shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding-up, liquidation or
reorganization proceedings are pending, or upon a certificate of the receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, delivered to the Trustee or to the Holders of the
Securities for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article Eight.
SECTION 8.08. Trustee's Relation to Senior Indebtedness.
The Trustee and any Paying Agent shall be entitled to all the rights
set forth in this Article Eight with respect to any Senior Indebtedness which
may at any time be held by it in its individual or any other capacity to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee or any Paying Agent of any of its rights as
such holder.
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With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article Eight, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness (except as provided in
Section 8.03(b)). The Trustee shall not be liable to any such holders if the
Trustee shall in good faith mistakenly pay over or distribute to Holders of
Securities or to the Company or to any other person cash, property or securities
to which any holders of Senior Indebtedness shall be entitled by virtue of this
Article Eight or otherwise.
SECTION 8.09. Subordination Rights Not Impaired by Acts or Omissions of the
Company or Holders of Senior Indebtedness.
No right of any present or future holders of any Senior Indebtedness to
enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms of this Indenture, regardless of any
knowledge thereof which any such holder may have or otherwise be charged with.
The provisions of this Article Eight are intended to be for the benefit of, and
shall be enforceable directly by, the holders of Senior Indebtedness.
SECTION 8.10. Securityholders Authorize Trustee to Effectuate Subordination of
Securities.
Each Holder of Securities by his acceptance of such Securities
authorizes and expressly directs the Trustee on its or his behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this Article Eight, and appoints the Trustee its or his
attorney-in-fact for such purposes, including, in the event of any dissolution,
winding-up, liquidation or reorganization of the Company (whether in bankruptcy,
insolvency, receivership, reorganization or similar proceedings or upon an
assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Company, the filing of a claim for
the unpaid balance of its or his Securities in the form required in those
proceedings.
SECTION 8.11. This Article Not to Prevent Events of Default.
The failure to make a payment on account of principal of or interest or
Liquidated Damages, if any, on the Securities by reason of any provision of this
Article Eight shall not be construed as preventing the occurrence of an Event of
Default specified in clause (i) or (ii) of Section 6.01.
SECTION 8.12. Trustee's Compensation Not Prejudiced.
Nothing in this Article Eight shall apply to amounts due to the Trustee
pursuant to other sections in this Indenture.
SECTION 8.13. No Waiver of Subordination Provisions.
Without in any way limiting the generality of Section 8.09, the holders
of Senior Indebtedness may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders of the Securities, without
incurring responsibility to the Holders of the Securities and without impairing
or releasing the subordination provided in this Article Eight or the obligations
hereunder of the Holders of the Securities to the holders of Senior
Indebtedness, do any one or more of the following: (a) change the manner,
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place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness or any instrument evidencing the same or any agreement under
which Senior Indebtedness is outstanding or secured; (b) sell, exchange, release
or otherwise deal with any property pledged, mortgaged or otherwise securing
Senior Indebtedness; (c) release any Person liable in any manner for the
collection of Senior Indebtedness; and (d) exercise or refrain from exercising
any rights against the Company and any other Person.
SECTION 8.14. Subordination Provisions Not Applicable to Collateral Held in
Trust for Securityholders; Payments May Be Paid Prior
to Dissolution.
All money and United States Government Obligations deposited in trust
with the Trustee pursuant to and in accordance with Article Nine shall be for
the sole benefit of the Holders and shall not be subject to this Article Eight.
Nothing contained in this Article Eight or elsewhere in this Indenture
shall prevent (i) the Company, except under the conditions described in Section
8.02, from making payments of principal of and interest and Liquidated Damages,
if any, on the Securities, or from depositing with the Trustee any moneys for
such payments or from effecting a termination of the Company's and the
Guarantor's obligations under the Securities and this Indenture as provided in
Article Nine, or (ii) the application by the Trustee of any moneys deposited
with it for the purpose of making such payments of principal of and interest and
Liquidated Damages, if any, on the Securities, to the Holders entitled thereto
unless at least two Business Days prior to the date upon which such payment
becomes due and payable, the Trustee shall have received the written notice
provided for in Section 8.02(b) or in Section 8.06. The Company shall give
prompt written notice to the Trustee of any dissolution, winding-up, liquidation
or reorganization of the Company.
SECTION 8.15. Acceleration of Securities.
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of the Senior Indebtedness of
the acceleration.
ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture.
The Company and the Guarantor may terminate their Obligations under the
Securities, the Guarantee and this Indenture, except the obligations referred to
in the last paragraph of this Section 9.01, if there shall have been cancelled
by the Trustee or delivered to the Trustee for cancellation all Securities
theretofore authenticated and delivered (other than any Securities that are
asserted to have been destroyed, lost or stolen and that shall have been
replaced as provided in Section 2.07) and the Company has paid all sums payable
by it hereunder or deposited all required sums with the Trustee.
After such delivery the Trustee upon request shall acknowledge in
writing the discharge of the Company's and the Guarantor's Obligations under the
Securities, the Guarantee and this Indenture except for those surviving
obligations specified below.
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Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company and the Guarantor in Sections 7.07, 9.05 and 9.06
hereof shall survive.
SECTION 9.02. Legal Defeasance.
The Company may at its option, by resolution of the Board of Directors,
be discharged from its Obligations with respect to the Securities and the
Guarantor discharged from its Obligations under the Guarantee on the date the
conditions set forth in Section 9.04 below are satisfied (hereinafter, the
"Legal Defeasance Option"). For this purpose, exercise of such Legal Defeasance
Option means that the Company shall be deemed to have paid and discharged the
entire indebtedness represented by the Securities and to have satisfied all its
other Obligations under such Securities and this Indenture insofar as such
Securities are concerned (and the Trustee, at the expense of the Company, shall,
subject to Section 9.06 hereof, execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (A) the rights of Holders of outstanding Securities to
receive solely from the trust funds described in Section 9.04 hereof and as more
fully set forth in such Section, payments in respect of the principal of and
premium, if any, and interest and Liquidated Damages, if any, on such Securities
when such payments are due, (B) the Company's obligations with respect to such
Securities under Sections 2.03, 2.04 and 2.07, (C) the rights, powers, trusts,
duties, and immunities of the Trustee hereunder (including claims of, or
payments to, the Trustee under or pursuant to Section 7.07 hereof) and (D) this
Article Nine. Subject to compliance with this Article Nine, the Company may
exercise its Legal Defeasance Option under this Section 9.02 with respect to the
Securities notwithstanding the prior exercise of its option under Section 9.03
below with respect to the Securities. If the Company exercises its Legal
Defeasance Option, payment of the Securities may not be accelerated because of
an Event of Default with respect thereto.
SECTION 9.03. Covenant Defeasance.
At the option of the Company, pursuant to a resolution of the Board of
Directors, the Company and the Guarantor shall be released from their respective
Obligations under Sections 4.03 through 4.06 and Sections 4.14 through 4.20,
clauses (iii) and (iv) of paragraph (a) of Section 5.01, and paragraphs (c),
(d), (e) and (f) of Section 6.01, with respect to the outstanding Securities on
and after the date the conditions set forth in Section 9.04 hereof are satisfied
(hereinafter, "Covenant Defeasance Option"). For this purpose, exercise of such
Covenant Defeasance Option means that the Company and the Guarantor may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such specified Section or portion thereof, whether
directly or indirectly by reason of any reference elsewhere herein to any such
specified Section or portion thereof or by reason of any reference in any such
specified Section or portion thereof to any other provision herein or in any
other document, but the remainder of this Indenture and the Securities shall be
unaffected thereby. If the Company exercises the Covenant Defeasance Option,
payment of the Securities shall not be accelerated because of an Event of
Default specified in paragraphs (c), (d), (e) or (f) of Section 6.01 or because
of the Company's failure to comply with clauses (iii) and (iv) under paragraph
(a) of Section 5.01.
SECTION 9.04. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to application of Section 9.02 or
Section 9.03 hereof to the outstanding Securities:
(1) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10 who shall agree to comply with
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the provisions of this Article Nine applicable to it) as funds in trust
(the "defeasance trust") for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit
of the Holders of the Securities, (A) money in an amount, or (B) U.S.
Government Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will provide, not
later than the due date of any payment, money in an amount, or (C) a
combination thereof, sufficient, in the opinion of a nationally-recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall be
applied by the Trustee (or other qualifying trustee) to pay and discharge,
the principal of and premium, if any, and accrued interest and Liquidated
Damages, if any, on the outstanding Securities on the Final Maturity Date of
such principal of or premium, if any, or interest, and Liquidated Damages,
if any, or on dates for payment and redemption of such principal and
premium, if any, and interest and Liquidated Damages, if any, selected in
accordance with the terms of this Indenture and of the Securities;
(2) no Event of Default or Default with respect to the Securities shall
have occurred and be continuing on the date of such deposit, or shall have
occurred and be continuing at any time during the period ending on the 91st
day after the date of such deposit or, if longer, ending on the day
following the expiration of the longest preference period under any
Bankruptcy Law applicable to the Company in respect of such deposit (it
being understood that this condition shall not be deemed satisfied until the
expiration of such period);
(3) such Legal Defeasance Option or Covenant Defeasance Option shall
not cause the Trustee to have a conflicting interest for purposes of the TIA
with respect to any securities of the Company;
(4) such Legal Defeasance Option or Covenant Defeasance Option shall
not result in a breach or violation of, or constitute default under any
other agreement, including without limitation the Credit Agreement, or
instrument to which the Company is a party or by which it is bound;
(5) the Company shall have delivered to the Trustee an Opinion of
Counsel stating that, as a result of such Legal Defeasance Option or
Covenant Defeasance Option, neither the trust nor the Trustee will be
required to register as an investment company under the Investment Company
Act of 1940, as amended;
(6) in the case of an election under Section 9.02 above, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that (i)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling to the effect that or (ii) there has been a change
in any applicable federal income tax law with the effect that, and such
opinion shall confirm that, the Holders of the outstanding Securities or
Persons in their positions will not recognize income, gain or loss for
federal income tax purposes solely as a result of such deposit in the
defeasance trust or the exercise of the Legal Defeasance Option and will be
subject to federal income tax on the same amount, in the same manner and at
the same times as would have been the case if such deposit in the defeasance
trust or the exercise of the Legal Defeasance Option had not occurred;
(7) in the case of an election under Section 9.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect that
the Holders of the outstanding Securities or Persons in their positions will
not recognize income, gain or loss for federal income tax purposes solely as
a result of such deposit in the defeasance trust or the exercise of the
Covenant Defeasance
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Option and will be subject to federal income tax on the same amount, in
the same manner and at the same times as would have been the case if such
deposit in the defeasance trust or the exercise of the Covenant Defeasance
Option had not occurred;
(8) 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 Legal Defeasance Option under
Section 9.02 or the Covenant Defeasance Option under Section 9.03 (as the
case may be) have been complied with;
(9) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit under clause (1) was not made by the
Company with the intent of defeating, hindering, delaying or defrauding any
creditors of the Company or others; and
(10) the Company shall have paid or duly provided for payment under
terms mutually satisfactory to the Company and the Trustee all amounts then
due to the Trustee pursuant to Section 7.07 hereof.
SECTION 9.05. Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 9.04 hereof in respect
of the outstanding Securities shall be held in trust and applied by the Trustee,
in accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become due
thereon in respect of principal, premium, if any, accrued interest and
Liquidated Damages, if any, but such money need not be segregated from other
funds except to the extent required by law.
The Company and the Guarantor shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed against the U.S.
Government Obligations deposited pursuant to Section 9.04 hereof or the
principal, premium, if any, and interest received in respect thereof other than
any such tax, fee or other charge which by law is for the account of the Holders
of the outstanding Securities.
Anything in this Article Nine to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 9.04 which, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent Legal Defeasance Option or
Covenant Defeasance Option.
SECTION 9.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 9.01, 9.02 or 9.03 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 Guarantor's Obligations under this Indenture,
the Securities and the Guarantee shall be revived and reinstated as though no
deposit had occurred pursuant to this Article Nine until such time as the
Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in
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accordance with Section 9.01; provided, however, that if the Company or the
Guarantor has made any payment of principal of, premium, if any, accrued
interest or Liquidated Damages, if any, on any Securities because of the
reinstatement of their Obligations, the Company or the Guarantor, as the case
may be, shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
SECTION 9.07. Moneys Held by Paying Agent.
In connection with the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon demand of the Company, be paid to the Trustee, or if sufficient
moneys have been deposited pursuant to Section 9.01 hereof, to the Company (or,
if such moneys had been deposited by the Guarantor, to such Guarantor), and
thereupon such Paying Agent shall be released from all further liability with
respect to such moneys.
SECTION 9.08. Moneys Held by Trustee.
Any moneys deposited with the Trustee or any Paying Agent or then held
by the Company or the Guarantor in trust for the payment of the principal of, or
premium, if any, interest or Liquidated Damages, if any, on any Security that
are not applied but remain unclaimed by the Holder of such Security for two
years after the date upon which the principal of, or premium, if any, interest
or Liquidated Damages, if any, on such Security shall have respectively become
due and payable shall be repaid to the Company (or, if appropriate, the
Guarantor) upon Company Request, or if such moneys are then held by the Company
or the Guarantor in trust, such moneys shall be released from such trust; and
the Holder of such Security entitled to receive such payment shall thereafter,
as an unsecured general creditor, look only to the Company and the Guarantor for
the payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money shall thereupon cease; provided, however, that the
Trustee or any such Paying Agent, before being required to make any such
repayment, may, at the expense of the Company and the Guarantor, either mail to
each Securityholder affected, at the address shown in the Register, or cause to
be published once a week for two successive weeks, in a newspaper published in
the English language, customarily published each Business Day and of general
circulation in The City of New York, New York, a 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 mailing or publication, any unclaimed balance of
such moneys then remaining will be repaid to the Company or the Guarantor. After
payment to the Company or the Guarantor or the release of any money held in
trust by the Company or the Guarantor, as the case may be, Securityholders
entitled to the money must look only to the Company and the Guarantor for
payment as general creditors unless applicable abandoned property law designates
another Person.
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 10.01. Without Consent of Holders.
The Company and the Guarantor, when authorized by a resolution of the
Board of Directors and the board of directors of the Guarantor, and the Trustee
may amend or supplement this Indenture or the Securities without notice to or
consent of any Securityholder:
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(i) to cure any ambiguity, defect or inconsistency; provided, however,
that such amendment or supplement does not adversely affect the rights of
any Holder;
(ii) to provide for uncertificated Securities in addition to or in
place of Certificated Securities;
(iii) to provide for the assumption by a successor Person of the
obligations of the Company to the Holders of Securities under the
Securities, this Indenture and the Registration Rights Agreement in
connection with any transaction complying with Article Five of this
Indenture;
(iv) to provide for a guarantee of payment of the Securities by any
Restricted Subsidiary pursuant to Section 4.20;
(v) to comply with any requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA; or
(vi) to make any change that does not materially adversely affect the
legal rights of any Holder under this Indenture;
provided, however, that the Company has delivered to the Trustee an Opinion of
Counsel stating that such amendment or supplement complies with the provisions
of this Section 10.01.
SECTION 10.02. With Consent of Holders.
Subject to Section 6.07, the Company and the Guarantor, when authorized
by a resolution of the Boards of Directors and the board of directors of the
Guarantor, and the Trustee may amend or supplement this Indenture or the
Securities with the written consent of the Holders of at least a majority in
principal amount of the outstanding Securities. Subject to Section 6.07, the
Holders of a majority in principal amount of the outstanding Securities may
waive compliance by the Company or the Guarantor with any provision of this
Indenture or the Securities. However, without the consent of each Securityholder
affected, an amendment, supplement or waiver, including a waiver pursuant to
Section 6.04, may not:
(i) reduce the principal amount of any Securities whose Holders must
consent to an amendment to this Indenture or a waiver under this Indenture;
(ii) reduce the rate on or change the interest payment time on any
Security or alter the redemption provisions with respect thereto (other than
the provisions relating to Section 4.05 and 4.14) or the price at which the
Company is required to offer to purchase the Securities;
(iii) reduce the principal of or change the fixed maturity of any
Security;
(iv) change currency of payment of the principal of or interest on any
Security;
(v) modify any provisions of Section 6.01 or 6.04 (other than to add
sections of this Indenture or the Securities subject thereto) or 6.07; and
(vi) waive any default in the payment of the principal of, premium, if
any, or unpaid interest on, and Liquidated Damages, if any, with respect to
the Securities.
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An amendment under this Section 10.02 may not make any change under
Article Eight, Article Nine, Article Eleven or Article Twelve hereof that
adversely affects in any material respect the rights of any holder of Senior
Indebtedness then outstanding unless the holders of such Senior Indebtedness (or
any representative thereof authorized to give a consent) shall have consented to
such change.
It shall not be necessary for the consent of the Holders under this
Section 10.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 10.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such supplemental indenture.
SECTION 10.03. Compliance with Trust Indenture Act.
Every amendment to or supplement of this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 10.04. Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
Holder is a continuing consent by the Holder and every subsequent Holder of that
Security or portion of that Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security. Subject to the following paragraph, any such Holder or subsequent
Holder may revoke the consent as to such Holder's Security or portion of such
Security by notice to the Trustee or the Company received before the date on
which the Trustee receives an Officers' Certificate certifying that the Holders
of the requisite principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders of Securities entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then,
notwithstanding the last sentence of the immediately preceding paragraph, those
persons who were Holders of Securities at such record date (or their duly
designated proxies), and only those persons, shall be entitled to consent to
such amendment, supplement or waiver or to revoke any consent previously given,
whether or not such Persons continue to be Holders of such Securities after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(i) through (vi) of Section 10.02. In that case the amendment, supplement or
waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security.
SECTION 10.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on
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the Security about the changed terms and return it to the Holder. Alternatively,
if the Company or the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new Security that
reflects the changed terms. Failure to make the appropriate notation or issue a
new Security shall not affect the validity and effect of such amendment,
supplement or waiver.
SECTION 10.06. Trustee to Sign Amendments, etc.
The Trustee shall be entitled to receive, and shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution of any
amendment, supplement or waiver authorized pursuant to this Article Ten is
authorized or permitted by this Indenture and that such amendment, supplement or
waiver constitutes the legal, valid and binding obligation of the Company and
the Guarantor, enforceable in accordance with its terms (subject to customary
exceptions). The Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture or otherwise. In signing any amendment,
supplement or waiver, the Trustee shall be entitled to receive an indemnity
reasonably satisfactory to it.
ARTICLE ELEVEN
GUARANTEE
SECTION 11.01. Unconditional Guarantee.
The Guarantor hereby irrevocably and unconditionally guarantees to each
Holder of a Security authenticated by the Trustee and to the Trustee and its
successors and assigns that: the principal of and premium, if any, interest or
Liquidated Damages, if any, on the Securities will be promptly paid in full when
due, subject to any applicable grace period, whether on the Final Maturity Date,
by acceleration, call for redemption, upon a Change of Control Offer, upon an
Asset Sale Offer or otherwise, and interest on the overdue principal and
interest on any overdue interest on the Securities and expenses, indemnification
or otherwise, and all other obligations of the Company (all such obligations
guaranteed by the Guarantor being called herein the "Guaranteed Obligations"),
to the Holders or the Trustee hereunder or under the Securities will be promptly
paid in full or performed, all in accordance with the terms hereof and thereof;
subject, however, to the limitations set forth in Section 11.03. The Guarantor
hereby agrees that its obligations hereunder shall be unconditional and
continuing, 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 the Guarantor and shall (a) remain in
full force and effect until payment in full of all the Guaranteed Obligations,
(b) be binding upon the Guarantor and its successors, transferees and assigns
and (c) inure to the benefit of and be enforceable by the Trustee, the Holders
of the Securities and their successors, transferees and assigns. The 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 Guaranteed Obligations, and this Guarantee. If any
Holder or the Trustee is required by any court or otherwise to return to the
Company, the Guarantor, or any Custodian, trustee, liquidator or other similar
official acting in relation to the Company or the Guarantor, any amount paid by
the Company or the Guarantor to the Trustee or such Holder, the Guarantee, to
the extent
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theretofore discharged, shall be reinstated in full force and effect. The
Guarantor further agrees that, as between the Guarantor, on the one hand, and
the Holders and the Trustee, on the other hand, (x) the maturity of the
Guaranteed Obligations hereby may be accelerated as provided in Article Six for
the purpose of this Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Guaranteed
Obligations, and (y) in the event of any acceleration of the Guaranteed
obligations as provided in Article Six, such Guaranteed Obligations (whether or
not due and payable) shall forthwith become due and payable by the Guarantor for
the purpose of this Guarantee.
SECTION 11.02. Severability.
In case any provision of this Guarantee shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
SECTION 11.03. Limitation of Guarantor's Liability.
The Guarantor and, by its acceptance of a Security issued hereunder,
each Holder and the Trustee hereby confirm that it is the intention of all such
parties that the guarantee by the Guarantor pursuant to its Guarantee not
constitute a fraudulent transfer or conveyance for purposes of any Bankruptcy
Law, 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 the Guarantor hereby irrevocably agree that
the obligations of the Guarantor under the Guarantee shall be limited to the
maximum amount as will, after giving effect to all other contingent and fixed
liabilities of the Guarantor, result in the obligations of the Guarantor under
the Guarantee not constituting such fraudulent transfer or conveyance.
SECTION 11.04. Subordination of Subrogation and Other Rights.
The Guarantor hereby agrees that any claim against the Company that
arises from the payment, performance or enforcement of the Guarantor's
obligations under the Guarantee or this Indenture, including, without
limitation, any right of subrogation, shall be subject and subordinate to, and
no payment with respect to any such claim of the Guarantor shall be made before,
the payment in full in cash of all outstanding Securities in accordance with the
provisions provided therefor in this Indenture.
SECTION 11.05. Delivery of Guarantee.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
Section 11.01 on behalf of the Guarantor.
ARTICLE TWELVE
SUBORDINATION OF GUARANTEE
SECTION 12.01. Guarantee Obligations Subordinated to Guarantor Senior
Indebtedness.
The Guarantor covenants and agrees, and the Trustee and each Holder of
the Securities by its or his acceptance thereof likewise covenants and agrees,
that the Guarantee shall be issued subject to the provisions of this Article
Twelve; and each person holding any Security, whether upon original issue or
upon trans-
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fer, assignment or exchange thereof, accepts and agrees that all payments of the
principal of and premium, if any, interest and Liquidated Damages, if any, on
the Securities pursuant to the Guarantee made by or on behalf of the Guarantor
shall, to the extent and in the manner set forth in this Article Twelve, be
subordinated and junior in right of payment to the prior payment in full in cash
of all amounts payable under Guarantor Senior Indebtedness of the Guarantor.
SECTION 12.02. No Payment on Guarantee in Certain Circumstances.
(a) No direct or indirect payment by or on behalf of the Guarantor of
principal of or premium, if any, or interest or Liquidated Damages, if any, on
the Securities, whether pursuant to the Guaranteed Obligations, whether pursuant
to the terms of the Securities, upon acceleration, pursuant to an Asset Sale
Offer or Change of Control Offer or otherwise, shall be made to the holders of
Securities and instead shall be made to the holders of Guarantor Senior
Indebtedness (except that holders of Securities may receive payments made from
the defeasance trust described under Section 9.04) if (i) a default in the
payment of the principal of or premium, if any, or interest on Guarantor Senior
Indebtedness occurs and is continuing beyond any applicable period of grace or
(ii) any other default occurs and is continuing with respect to Designated
Guarantor Senior Indebtedness that permits holders of the Designated Guarantor
Senior Indebtedness as to which such default relates to accelerate its maturity
and the Trustee receives a written notice (with a copy to the Guarantor) of such
other default (a "Guarantor Payment Blockage Notice") from the Guarantor or the
holders of any Designated Guarantor Senior Indebtedness until all Obligations
with respect to such Designated Guarantor Senior Indebtedness are paid in full;
payments on the Securities shall be resumed (a) in the case of a payment
default, upon the date on which such default is cured or waived and (b) in case
of a nonpayment default, the earlier of the date on which such nonpayment
default is cured or waived or 179 days after the date on which the applicable
Guarantor Payment Blockage Notice is received by the Trustee (such period being
referred to herein as the "Guarantor Payment Blockage Period"), unless the
maturity of any Designated Guarantor Senior Indebtedness has been accelerated
(and written notice of such acceleration has been received by the Trustee). No
nonpayment default that existed or was continuing on the date of delivery of any
Guarantor Payment Blockage Notice to the Trustee shall be, or be made, the basis
for a subsequent Guarantor Payment Blockage Notice (it being understood that any
subsequent action, or any breach of any covenant for a period commencing after
the date of receipt by the Trustee of such Guarantor Payment Blockage Notice,
that, in either case, would give rise to such a default pursuant to any
provisions under which a default previously existed or was continuing shall
constitute a new default for this purpose).
Notwithstanding anything herein or in the Securities to the contrary,
(x) in no event shall a Guarantor Payment Blockage Period extend beyond 179 days
from the date the Guarantor Payment Blockage Notice in respect thereof was
given, (y) there shall be a period of at least 181 consecutive days in each
360-day period when no Guarantor Payment Blockage Period is in effect and (z)
not more than one Guarantor Payment Blockage Period may be commenced with
respect to the Guarantor during any period of 360 consecutive days. No event of
default that existed or was continuing on the date of commencement of any other
Guarantor Payment Blockage Period with respect to the Designated Guarantor
Senior Indebtedness initiating such Guarantor Payment Blockage Period (to the
extent the holder of Designated Guarantor Senior Indebtedness, or trustee or
agent, giving notice commencing such Guarantor Payment Blockage Period had
knowledge of such existing or continuing event of default) may be, or be made,
the basis for the commencement of any other Guarantor Payment Blockage Period by
the holder or holders of such Designated Guarantor Senior Indebtedness or the
trustee or agent acting on behalf of such Designated Guarantor Senior
Indebtedness, whether or not within a period of 360 consecutive days, unless
such event of default has been cured or waived for a period of not less than 90
consecutive days.
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(b) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by
Section 12.02(a), such payment shall be held in trust for the benefit of, and
shall be paid over or delivered to, the holders of such Designated Guarantor
Senior Indebtedness or their respective representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Designated Guarantor
Senior Indebtedness may have been issued, as their respective interests may
appear, but only to the extent that, upon notice from the Trustee to the holders
of such Designated Guarantor Senior Indebtedness that such prohibited payment
has been made, the holders of such Designated Guarantor Senior Indebtedness (or
their representative or representatives or a trustee) notify the Trustee in
writing of the amounts then due and owing on such Designated Guarantor Senior
Indebtedness, if any, and only the amounts specified in such notice to the
Trustee shall be paid to the holders of such Designated Guarantor Senior
Indebtedness.
SECTION 12.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any payment or distribution of assets or securities of the
Guarantor of any kind or character, whether in cash, property or securities,
upon any dissolution or winding-up or liquidation or reorganization of the
Guarantor, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other similar proceedings, the holders of Guarantor Senior
Indebtedness shall be entitled to receive payment in full in cash of all
Obligations due in respect of such Guarantor Senior Indebtedness before the
Holders of the Securities or the Trustee on behalf of such Holders shall be
entitled to receive any payment by the Guarantor of the principal of or premium,
if any, and interest or Liquidated Damages, if any, on the Securities pursuant
to the Guarantee, or any payment to acquire any of the Securities for cash,
property or securities, or any distribution with respect to the Securities of
any cash, property or securities. Before any payment may be made by, or on
behalf of, the Guarantor of the principal of or premium, if any, and interest or
Liquidated Damages, if any, on the Securities upon any such dissolution or
winding-up or liquidation or reorganization, any payment or distribution of
assets or securities of the Guarantor of any kind or character, whether in cash,
property or securities, to which the Holders of the Securities or the Trustee on
their behalf would be entitled, but for the subordination provisions of this
Indenture, shall be made by the Guarantor or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, directly to the holders of the Guarantor Senior Indebtedness (pro
rata to such holders on the basis of the respective amounts of Guarantor Senior
Indebtedness held by such holders) or their representatives or to the trustee or
trustees or agent or agents under any agreement or indenture pursuant to which
any Guarantor Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all the Guarantor Senior
Indebtedness in full in cash after giving effect to any prior or concurrent
payment, distribution or provision therefor to or for the holders of Guarantor
Senior Indebtedness.
(b) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of the Guarantor of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or any Holder of
Securities at a time when such payment or distribution is prohibited by Section
12.03(a) and before all Obligations in respect of the Guarantor Senior
Indebtedness are paid in full in cash, or payment provided for, such payment or
distribution shall be received and held in trust for the benefit of, and shall
be paid over or delivered to, the holders of the Guarantor Senior Indebtedness
(pro rata to such holders on the basis of the respective amounts of Guarantor
Senior Indebtedness held by such holders) or their respective representatives,
or to the trustee or trustees or agent or agents under any indenture pursuant to
which any of Guarantor Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the payment of the Guarantor
Senior Indebtedness remaining unpaid until all Guarantor Senior Indebtedness has
been paid in full in cash after giving effect to any prior or concurrent
payment, distribution or provision therefor to or for the holders of Guarantor
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Senior Indebtedness; provided that the Trustee shall be entitled to receive from
the holders of Guarantor Senior Indebtedness written notice of the amounts owing
on the Guarantor Senior Indebtedness.
The consolidation of the Guarantor with, or the merger of the Guarantor
with or into, another corporation or the liquidation or dissolution of the
Guarantor following the conveyance or transfer of its property as an entirety,
or substantially as an entirety, to another corporation upon the terms and
conditions provided in Article Five shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 12.03
if such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article Five.
SECTION 12.04. Subrogation.
Upon the payment in full in cash of all Guarantor Senior Indebtedness
of the Guarantor, or provision for payment, the Holders of the Securities shall
be subrogated to the rights of the holders of Guarantor Senior Indebtedness to
receive payments or distributions of cash, property or securities of the
Guarantor made on Guarantor Senior Indebtedness until the principal of and
premium, if any, and interest and Liquidated Damages, if any, on the Securities
shall be paid in full in cash; and, for the purposes of such subrogation, no
payments or distributions to the holders of Guarantor Senior Indebtedness of any
cash, property or securities to which the Holders of the Securities or the
Trustee on their behalf would be entitled except for the provisions of this
Article Twelve, and no payment over pursuant to the provisions of this Article
Twelve to the holders of the Guarantor Senior Indebtedness by Holders of the
Securities or the Trustee on their behalf shall, as between the Guarantor, its
creditors other than holders of the Guarantor Senior Indebtedness, and the
Holders of the Securities, be deemed to be a payment by the Guarantor to or on
account of the Guarantor Senior Indebtedness. It is understood that the
provisions of this Article Twelve are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities, on the one hand,
and the holders of Guarantor Senior Indebtedness, on the other hand.
If any payment or distribution to which the Holders of the Securities
would otherwise have been entitled but for the provisions of this Article Twelve
shall have been applied, pursuant to the provisions of this Article Twelve, to
the payment of all amounts payable under Guarantor Senior Indebtedness, then and
in such case, the Holders of the Securities shall be entitled to receive from
the holders of such Guarantor Senior Indebtedness any payments or distributions
received by such holders of Guarantor Senior Indebtedness in excess of the
amount required to make payment in full, or provision for payment, of such
Guarantor Senior Indebtedness.
SECTION 12.05. Obligations of Guarantor Unconditional.
Nothing contained in this Article Twelve or elsewhere in this Indenture
or in the Securities or the Guarantee is intended to or shall impair, as between
the Guarantor and the Holders of the Securities, the obligation of the
Guarantor, which is absolute and unconditional, to pay to the Holders of the
Securities the principal of and premium, if any, or interest and Liquidated
Damages, if any, on the Securities as and when the same shall become due and
payable in accordance with the terms of the Guarantee, or is intended to or
shall affect the relative rights of the Holders of the Securities and creditors
of the Guarantor other than the holders of Guarantor Senior Indebtedness, nor
shall anything herein or therein prevent the Holder of any Security or the
Trustee on their behalf from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the rights, if any,
under this Article Twelve of the holders of Guarantor Senior Indebtedness in
respect of cash, property or securities of the Guarantor received upon the
exercise of any such remedy.
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Without limiting the generality of the foregoing, nothing contained in
this Article Twelve shall restrict the right of the Trustee or the Holders of
Securities to take any action to declare the Securities to be due and payable
prior to their stated maturity pursuant to Section 6.01 or to pursue any rights
or remedies hereunder; provided, however, that all Guarantor Senior Indebtedness
of the Guarantor then due and payable shall first be paid in full before the
Holders of the Securities or the Trustee are entitled to receive any direct or
indirect payment from such Guarantor of principal of or premium, if any, or
interest or Liquidated Damages, if any, on the Securities pursuant to such
Guarantor's Guarantee.
SECTION 12.06. Notice to Trustee.
The Company and the Guarantor shall give prompt written notice to the
Trustee of any fact known to the Company or the Guarantor which would prohibit
the making of any payment to or by the Trustee in respect of the Securities
pursuant to the provisions of this Article Twelve. The Trustee shall not be
charged with knowledge of the existence of any event of default with respect to
any Guarantor Senior Indebtedness or of any other facts which would prohibit the
making of any payment to or by the Trustee unless and until the Trustee shall
have received notice in writing at its Corporate Trust Office to that effect
signed by an Officer of the Company or the Guarantor, or by a holder of
Guarantor Senior Indebtedness or trustee or agent therefor; and prior to the
receipt of any such written notice, the Trustee shall, subject to Article Seven,
be entitled to assume that no such facts exist; provided that if the Trustee
shall not have received the notice provided for in this Section 12.06 at least
two Business Days prior to the date upon which by the terms of this Indenture
any moneys shall become payable for any purpose (including, without limitation,
the payment of the principal of or premium, if any, or interest or Liquidated
Damages, if any, on any Security), then, regardless of anything herein to the
contrary, the Trustee shall have full power and authority to receive any moneys
from the Guarantor and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such prior date. Nothing contained in this Section
12.06 shall limit the right of the holders of Guarantor Senior Indebtedness to
recover payments as contemplated by Section 12.03. The Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself or itself to be a holder of any Guarantor Senior Indebtedness (or a
trustee on behalf of, or other representative of, such holder) to establish that
such notice has been given by a holder of Guarantor Senior Indebtedness or a
trustee or representative on behalf of any such holder.
In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Guarantor Senior Indebtedness to participate in any payment or distribution
pursuant to this Article Twelve, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Guarantor Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article Twelve, and if
such evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
SECTION 12.07. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets or securities of the
Guarantor referred to in this Article Twelve, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made by any court
of competent jurisdiction in which bankruptcy, dissolution, winding-up,
liquidation or reorganization proceedings are pending, or upon a certificate of
the receiver, trustee in bankruptcy, liquidating trustee, agent or other person
making such payment or distribution, delivered to the Trustee or to the Holders
of the Securities for the purpose of ascertaining the Persons entitled to
participate in such distribution, the
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holders of Guarantor Senior Indebtedness and other Indebtedness of the
Guarantor, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
Twelve.
SECTION 12.08. Trustee's Relation to Guarantor Senior Indebtedness.
The Trustee and any Paying Agent shall be entitled to all the rights
set forth in this Article Twelve with respect to any Guarantor Senior
Indebtedness which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Guarantor Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee or any
Paying Agent of any of its rights as such holder.
With respect to the holders of Guarantor Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article Twelve, and no implied
covenants or obligations with respect to the holders of Guarantor Senior
Indebtedness shall be read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Guarantor Senior
Indebtedness (except as provided in Section 12.03(b)). The Trustee shall not be
liable to any such holders if the Trustee shall in good faith mistakenly pay
over or distribute to Holders of Securities or to the Company or to any other
person cash, property or securities to which any holders of Guarantor Senior
Indebtedness shall be entitled by virtue of this Article Twelve or otherwise.
SECTION 12.09. Subordination Rights Not Impaired by Acts or Omissions of the
Guarantor or Holders of Guarantor Senior Indebtedness.
No right of any present or future holders of any Guarantor Senior
Indebtedness to enforce subordination as provided herein shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Guarantor or by any act or failure to act, in good faith, by any such
holder, or by any noncompliance by the Guarantor with the terms of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with. The provisions of this Article Twelve are intended to
be for the benefit of, and shall be enforceable directly by, the holders of
Guarantor Senior Indebtedness.
SECTION 12.10. Securityholders Authorize Trustee to Effectuate Subordination of
Guarantee.
Each Holder of Securities by its or his acceptance of such Securities
authorizes and expressly directs the Trustee on its or his behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in this Article Twelve, and appoints the Trustee its or his
attorney-in-fact for such purposes, including, in the event of any dissolution,
winding-up, liquidation or reorganization of the Guarantor (whether in
bankruptcy, insolvency, receivership, reorganization or similar proceedings or
upon an assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of such Guarantor, the filing of a claim
for the unpaid balance of its or his Securities in the form required in those
proceedings.
SECTION 12.11. This Article Not to Prevent Events of Default.
The failure to make a payment on account of principal of or premium, if
any, or interest or Liquidated Damages, if any, on the Securities by reason of
any provision of this Article Twelve shall not be construed as preventing the
occurrence of an Event of Default specified in clauses (i) or (ii) of Section
6.01.
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SECTION 12.12. Trustee's Compensation Not Prejudiced.
Nothing in this Article Twelve shall apply to amounts due to
the Trustee pursuant to other sections in this Indenture.
SECTION 12.13. No Waiver of Guarantee Subordination Provisions.
Without in any way limiting the generality of Section 12.09,
the holders of Guarantor Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article
Twelve or the obligations hereunder of the Holders of the Securities to the
holders of Guarantor Senior Indebtedness, do any one or more of the following:
(a) change the manner, place or terms of payment or extend the time of payment
of, or renew or alter, Guarantor Senior Indebtedness or any instrument
evidencing the same or any agreement under which Guarantor Senior Indebtedness
is outstanding or secured; (b) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing Guarantor Senior
Indebtedness; (c) release any Person liable in any manner for the collection of
Guarantor Senior Indebtedness; and (d) exercise or refrain from exercising any
rights against the Guarantor and any other Person.
SECTION 12.14. Payments May Be Paid Prior to Dissolution.
Nothing contained in this Article Twelve or elsewhere in this
Indenture shall prevent (i) the Guarantor, except under the conditions described
in Section 12.02, from making payments of principal of and premium, if any, and
interest and Liquidated Damages, if any, on the Securities, or from depositing
with the Trustee any moneys for such payments, or (ii) the application by the
Trustee of any moneys deposited with it for the purpose of making such payments
of principal of and premium, if any, and interest and Liquidated Damages, if
any, on the Securities, to the Holders entitled thereto unless at least two
Business Days prior to the date upon which such payment becomes due and payable,
the Trustee shall have received the written notice provided for in Section
12.02(b) or in Section 12.06. The Guarantor shall give prompt written notice to
the Trustee of any dissolution, winding-up, liquidation or reorganization of the
Guarantor.
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls.
This Indenture is subject to the provisions of the TIA that
are required to be a part of this Indenture, and shall, to the extent
applicable, be governed by such provisions. If any provision of this Indenture
modifies any TIA provision that may be so modified, such TIA provision shall be
deemed to apply to this Indenture as so modified. If any provision of this
Indenture excludes any TIA provision that may be so excluded, such TIA provision
shall be excluded from this Indenture.
The provisions of TIA Sections 310 through 317 that
impose duties on any Person (including the provisions automatically deemed
included unless expressly excluded by this Indenture) are a part of and govern
this Indenture, whether or not physically contained herein.
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SECTION 13.02. Notices.
Any notice or communication shall be sufficiently given if in
writing and delivered in person, by facsimile and confirmed by overnight
courier, or mailed by first-class mail addressed as follows:
if to the Company or to the Guarantor:
Fedders Corporation
Westgate Corporate Center
505 Martinsville Road
P.O. Box 813
Liberty Corner, New Jersey 07938
Attention: Robert N. Edwards
Vice President and General Counsel
Facsimile: (908) 604-9317
Telephone: (908) 604-8686
with a copy to:
Cummings & Lockwood
Four Stamford Plaza
P.O. Box 120
Stamford, Connecticut 06904
Attention: Paul G. Hughes
Facsimile: (203) 351-4534
Telephone: (203) 327-1700
if to the Trustee:
State Street Bank and Trust Company
2 International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Facsimile: (617) 664-5374
Telephone: (617) 664-5553
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed, first-class, postage
prepaid, to a Holder including any notice delivered in connection with TIA
Section 310(b), TIA Section 313(c), TIA Section 314(a) and TIA Section 315(b),
shall be mailed to it or him at its or his address as set forth in the Register
and shall be sufficiently given to it or him if
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so mailed within the time prescribed. To the extent required by the TIA, any
notice or communication shall also be mailed to any Person described in TIA
Section 313(c).
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. Except for a notice to the Trustee, which is deemed given only
when received, if a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 13.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b)
with other Securityholders with respect to their rights under this Indenture or
the Securities. The Company, the Trustee, the Registrar and any other Person
shall have the protection of TIA Section 312(c).
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company or the
Guarantor to the Trustee to take or refrain from taking any action under this
Indenture, the Company or the Guarantor shall furnish to the Trustee at the
request of the Trustee:
(1) an Officers' Certificate in form and substance
satisfactory to the Trustee stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance satisfactory
to the Trustee stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 13.05. Statements Required in Certificate or Opinion.
Each Officers' Certificate or Opinion of Counsel with respect
to compliance with a condition or covenant provided for in this Indenture shall
include:
(1) a statement that the Person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with; provided,
however, that with respect to matters of fact an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
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SECTION 13.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by or at a
meeting of Securityholders. The Paying Agent or Registrar may make reasonable
rules for its functions.
SECTION 13.07. Governing Law.
The laws of the State of New York shall govern this Indenture,
the Securities and the Guarantee without regard to principles of conflicts of
law.
SECTION 13.08. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the
Company or the Guarantor shall not have any liability for any Obligations of the
Company or the Guarantor under the Securities, the Guarantee or this Indenture
or for any claim based on, in respect of or by reason of such Obligations or
their creation. Each Securityholder by accepting a Security waives and releases
all such liability and such waiver and release is part of the consideration for
issuance of the Securities.
SECTION 13.09. Successors.
All agreements of the Company in this Indenture and the
Securities shall bind its successor. All agreements of the Guarantor in this
Indenture and the Guarantee shall bind its successor. All agreements of the
Trustee in this Indenture shall bind its successor.
SECTION 13.10. Counterpart Originals.
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.
SECTION 13.11. Severability.
In case any provision in this Indenture, in the Securities or
in the Guarantee shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby, and a Holder shall have no claim therefor against
any party hereto.
SECTION 13.12. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture,
loan or debt agreement of the Company, the Guarantor or a Subsidiary. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 13.13. Legal Holidays.
If a payment date is a not a Business Day at a place of
payment, payment may be made at that place on the next succeeding Business Day,
and no interest shall accrue for the intervening period.
[Signature Pages Follow]
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the date first written above.
FEDDERS NORTH AMERICA, INC.
By: /s/Robert L. Laurent, Jr.
-------------------------------------
Name: Robert L. Laurent, Jr.
Title: Executive Vice President
FEDDERS CORPORATION,
as Guarantor
By: /s/Robert L. Laurent, Jr.
-------------------------------------
Name: Robert L. Laurent, Jr.
Title: Executive Vice President
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By: /s/Jill Olson
-------------------------------------
Name: Jill Olson
Title: Assistant Vice President
85
EXHIBIT A
---------
[FORM OF SERIES A SECURITY]
[LEGEND FOR RESTRICTED SECURITY]
THIS NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT
AS SET FORTH IN THE SECOND SENTENCE HEREOF. BY ITS ACQUISITION HEREOF OR OF A
BENEFICIAL INTEREST HEREIN, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) (A "QIB") OR (B) IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL
NOT RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY OF
ITS SUBSIDIARIES, (B) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QIB
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING
THE REQUIREMENTS OF RULE 903 OR 904 OF THE SECURITIES ACT, (D) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER,
FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS NOTE (THE FORM OF WHICH CAN BE
OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE
PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE
TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (F)
IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY)
OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION" AND "UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN
VIOLATION OF THE FOREGOING.
[LEGEND FOR TEMPORARY REGULATION S GLOBAL SECURITY]
THIS SECURITY IS A TEMPORARY REGULATION S GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE REFERRED TO HEREINAFTER. EXCEPT IN THE
CIRCUMSTANCES DESCRIBED IN SECTION 2.06 OF THE INDENTURE, INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY NOT BE OFFERED OR SOLD TO A U.S.
PERSON OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON PRIOR TO THE
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EXPIRATION OF THE RESTRICTED PERIOD (AS DEFINED IN THE INDENTURE), AND NO
TRANSFER OR EXCHANGE OF AN INTEREST IN THIS TEMPORARY REGULATION S GLOBAL
SECURITY MAY BE MADE FOR AN INTEREST IN A RESTRICTED GLOBAL SECURITY OR IN A
PERMANENT REGULATION S GLOBAL SECURITY UNTIL AFTER THE LATER OF THE DATE OF
EXPIRATION OF THE RESTRICTED PERIOD AND THE DATE ON WHICH THE OWNER SECURITIES
CERTIFICATION AND THE DEPOSITORY SECURITIES CERTIFICATION RELATING TO SUCH
INTEREST HAVE BEEN PROVIDED IN ACCORDANCE WITH THE TERMS OF THE INDENTURE, TO
THE EFFECT THAT THE BENEFICIAL OWNER OR OWNERS OF SUCH INTEREST ARE NOT U.S.
PERSONS.
[LEGEND FOR PERMANENT REGULATION S GLOBAL SECURITY OR NON-GLOBAL REGULATION S
SECURITY]
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED, SOLD, OR DELIVERED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY U.S. PERSON, UNLESS THE SECURITIES ARE REGISTERED UNDER THE
SECURITIES ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS THEREOF IS
AVAILABLE.
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FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Note
due August 15, 2007, Series A
CUSIP No.:
No. [ ] $[ ]
FEDDERS NORTH AMERICA, INC., a Delaware corporation (the
"Company", which term includes any successor corporation), for value received
promises to pay to [ ] or registered assigns, the principal sum of
[ ] Dollars, on August 15, 2007.
Interest Payment Dates: February 15 and August 15, commencing
on February 15, 1998.
Interest Record Dates: February 1 and August 1.
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officer.
FEDDERS NORTH AMERICA, INC.
By:
---------------------------------
Name:
Title:
Attest:
---------------------------------
Name:
Title:
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 9 3/8% Senior Subordinated Notes due 2007,
Series A, described in the within-mentioned Indenture.
Dated:
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:
----------------------------------
Authorized Signatory
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(REVERSE OF SECURITY)
FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Note
due August 15, 2007, Series A
1. Interest.
FEDDERS NORTH AMERICA, INC., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above. Cash interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from August 18, 1997. The Company will pay interest semi-annually in
arrears on each Interest Payment Date, commencing February 15, 1998. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities and on overdue
installments of interest (without regard to any applicable grace periods) to the
extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the Persons who are the registered Holders at the close
of business on the Interest Record Date immediately preceding the Interest
Payment Date even if the Securities are canceled on registration of transfer or
registration of exchange after such Interest Record Date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Company shall
pay principal and premium, if any, and interest and Liquidated Damages, if any,
in money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Company
may pay principal and premium, if any, and interest and Liquidated Damages, if
any, by wire transfer of Federal funds (provided that the Paying Agent shall
have received wire instructions on or prior to the relevant Interest Record
Date), or interest by check payable in such U.S. Legal Tender. The Company may
deliver any such interest payment to the Paying Agent or to a Holder at the
Holder's registered address.
3. Paying Agent and Registrar.
Initially, State Street Bank and Trust Company (the "Trustee")
will act as Paying Agent and Registrar. The Company may change any Paying Agent
or Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar.
4. Indenture and Guarantees.
The Company issued the Securities under an Indenture, dated as
of August 18, 1997 (the "Indenture"), among the Company, Fedders Corporation, a
Delaware corporation and the sole stockholder of the Company (the "Guarantor"),
and the Trustee. Capitalized terms herein are used as defined in the Indenture
unless otherwise defined herein. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"),
as in effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstand-
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ing anything to the contrary herein, the Securities are subject to all such
terms, and holders of Securities are referred to the Indenture and the TIA for a
statement of them. The Securities are general obligations of the Company limited
in aggregate principal amount to $100,000,000.
5. Registration Rights.
Pursuant to the Registration Rights Agreement, dated as of
August 18, 1997 (the "Registration Rights Agreement"), among the Company, the
Guarantor and the Initial Purchasers of the Series A Securities, the Company and
the Guarantor will be obligated to consummate an exchange offer pursuant to
which the Holder of this Security shall have the right to exchange this Security
for 9 3/8% Senior Subordinated Notes due 2007, Series B, of the Company (the
"Series B Securities"), which have been registered under the Securities Act, in
like principal amount and having identical terms as the Series A Securities. The
Holders of Series A Securities shall be entitled to receive certain additional
payments in the event such exchange offer is not consummated and upon certain
other conditions, all pursuant to and in accordance with the terms of the
Registration Rights Agreement. The Series A Securities and the Series B
Securities are together referred to herein as the "Securities."
6. Optional Redemption.
The Securities will be redeemable at the option of the
Company, in whole or in part, at any time or from time to time, on or after
August 15, 2002 at the redemption prices (expressed as a percentage of principal
amount) set forth below, plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Redemption Date if redeemed during the twelve-month
period commencing on August 15 of the years set forth below:
Year Percentage
- ---- ----------
2002 104.688%
2003 103.125%
2004 101.563%
2005 and thereafter 100.000%
7. Optional Redemption upon Certain Equity Issuances.
At any time, or from time to time, prior to August 15, 2000,
the Company may redeem up to 30% of the originally issued principal amount of
Securities at a redemption price equal to 109.375% of the principal amount of
the Securities so redeemed, plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the Redemption Date, with the net proceeds of one or
more Equity Offerings; provided, however, that at least 70% of the originally
issued principal amount of Securities remains outstanding immediately after
giving effect to any such redemption and provided, further, that such redemption
will occur within 60 days of the date of the Closing of such Equity Offering.
8. Notice of Redemption.
Notice of redemption will be mailed by first-class mail at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at its registered address. The Trustee may
select for redemption portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000 principal
amount or integral multiples thereof.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal
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91
amount equal to the unredeemed portion thereof will be issued in the name of the
Holder thereof upon cancellation of the original Security. On and after the
Redemption Date, interest will cease to accrue on Securities or portions thereof
called for redemption so long as the Company has deposited with the Paying Agent
for the Securities funds in satisfaction of the redemption price pursuant to the
Indenture.
9. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all outstanding Securities at a purchase price
equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the Change of Control
Purchase Date.
10. Limitation on Disposition of Assets.
The Company is, subject to certain conditions, obligated to
make an offer to purchase Securities at a purchase price equal to 100% of the
aggregate principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages thereon, if any, to the Asset Sale Purchase Date.
11. Subordination.
The Indebtedness evidenced by the Securities is, to the extent
and in the manner provided in the Indenture, subordinated and subject in right
payment to the prior payment in full in cash of all Senior Indebtedness as
defined in the Indenture, and this Security is issued subject to such
provisions. Each Holder of this Security, by accepting the same, (a) agrees to
and shall be bound by such provisions, (b) authorizes and directs the Trustee,
on behalf of such Holder, to take such action as may be necessary or appropriate
to effectuate the subordination as provided in the Indenture and (c) appoints
the Trustee attorney-in-fact of such Holder for such purpose.
12. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer or exchange of Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer or
exchange of any Securities or portions thereof selected for redemption, except
the unredeemed portion of any security being redeemed in part.
13. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
14. Unclaimed Funds.
If funds for the payment of principal or premium, if any, or
interest or Liquidated Damages, if any, remain unclaimed for two years, the
Trustee and the Paying Agent will repay the funds to the Company at its written
request. After that, all liability of the Trustee and such Paying Agent with
respect to such funds shall cease.
15. Legal Defeasance and Covenant Defeasance.
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The Company and the Guarantor may be discharged from their
obligations under the Indenture, the Securities and the Guarantee except for
certain provisions thereof, and may be discharged from obligations to comply
with certain covenants contained in the Indenture, the Securities and the
Guarantee, in each case upon satisfaction of certain conditions specified in the
Indenture.
16. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture, the Securities
and the Guarantee may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or Event of Default or compliance
with any provision may be waived with the consent of the Holders of a majority
in aggregate principal amount of the Securities then outstanding. Without notice
to or consent of any Holder, the parties thereto may amend or supplement the
Indenture, the Securities and the Guarantee to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of Certificated Securities or comply with any
requirements of the Commission in connection with the qualification of the
Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
17. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and the Restricted Subsidiaries to make
Restricted Payments, to incur Indebtedness, to create Liens, to sell assets, to
permit restrictions on dividends and other payments by Restricted Subsidiaries
to the Company, to consolidate, merge or sell all or substantially all of its
assets or to engage in transactions with Affiliates. The limitations are subject
to a number of important qualifications and exceptions. The Company must
annually report to the Trustee on compliance with such limitations.
18. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture, the Securities or the Guarantee except as
provided in the Indenture. The Trustee is not obligated to enforce the
Indenture, the Securities or the Guarantee unless it has received indemnity
satisfactory to it. The Indenture permits, subject to certain limitations
therein provided, Holders of a majority in aggregate principal amount of the
Securities then outstanding to direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of Securities notice of certain
continuing Defaults or Events of Default if it determines that withholding
notice is in their interest.
19. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries or their respective Affiliates as if it
were not the Trustee.
20. No Recourse Against Others.
No stockholder, director, officer or employee of the Company
shall have any liability for any Obligation of the Company under the Securities
or the Indenture, or for any claim based on, in respect of, or by reason of,
such Obligations or their creation. Each Holder of a Security by accepting a
Security waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities.
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21. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
22. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
24. Governing Law.
The laws of the State of New York shall govern the Indenture,
this Security and the Guarantee without regard to principles of conflicts of
laws.
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[FORM OF NOTATION ON SECURITY RELATING TO GUARANTEE]
SENIOR SUBORDINATED GUARANTEE
Fedders Corporation (the "Guarantor") has unconditionally and
irrevocably guaranteed on a senior subordinated basis (such guarantee being
referred to herein as the "Guarantee") (i) the due and punctual payment of the
principal of and interest or premium or Liquidated Damages, if any, on the
Securities, whether on the Final Maturity Date, by acceleration, call for
redemption, upon a Change of Control Offer, upon an Asset Sale Offer or
otherwise, the due and punctual payment of interest on the overdue principal and
interest, if any, on the Securities and expenses, indemnification or otherwise,
and the due and punctual performance of all other obligations of the Company to
the Holders or the Trustee all in accordance with the terms set forth in Article
Eleven and Article Twelve of the Indenture and (ii) in case of any extension of
time of payment or renewal of any Securities or any of such other obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
The obligations of the Guarantor to the Holders and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth and
are expressly subordinated and subject in right of payment to the prior payment
in full of all Guarantor Senior Indebtedness of the Guarantor, to the extent and
in the manner provided, in Article Eleven and Article Twelve of the Indenture,
and reference is hereby made to such Indenture for the precise terms of the
Guarantee therein made.
No director, officer, employee or stockholder, as such, of the
Guarantor shall have any liability under the Guarantee by reason of such
person's status as director, officer, employee or stockholder. Each holder of a
Security by accepting a Security waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the
Guarantee Indebtedness.
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.
FEDDERS CORPORATION
By:
-------------------------------
Name:
Title:
A-10
95
ASSIGNMENT FORM
I or we assign and transfer this Security to
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
- -------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
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:
----------------- -----------------------------------------
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:
-----------------------------------------------------------
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
A-11
96
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.05 or Section 4.14 of the Indenture, check the
appropriate box:
Section 4.05 [ ]
Section 4.14 [ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.05 or Section 4.14 of the
Indenture, state the amount: $
------------
Dated: Your Signature:
------------ -----------------------------------
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:
-----------------------------------------------------------
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
A-12
97
EXHIBIT B
---------
(FORM OF SERIES B SECURITY)
FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Note
due August 15, 2007, Series B
CUSIP No.:
No. [ ] $[ ]
FEDDERS NORTH AMERICA, INC., a Delaware corporation (the
"Company", which term includes any successor corporation), for value received
promises to pay to [ ] or registered assigns, the principal sum of
[ ] Dollars, on August 15, 2007.
Interest Payment Dates: February 15 and August 15, commencing
on February 15, 1998.
Interest Record Dates: February 1 and August 1.
Reference is made to the further provisions of this Security
contained herein, which will for all purposes have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be
signed manually or by facsimile by its duly authorized officer.
FEDDERS NORTH AMERICA, INC.
By:
-------------------------------------
Name:
Title:
Attest:
-------------------------
Name:
Title:
B-1
98
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 9 3/8% Senior Subordinated Notes due 2007,
Series B, described in the within-mentioned Indenture.
Dated:
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By:
-----------------------------------
Authorized Signatory
B-2
99
(REVERSE OF SECURITY)
FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Note
due August 15, 2007, Series B
1. Interest.
FEDDERS NORTH AMERICA, INC., a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above. Cash interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from August 18, 1997. The Company will pay interest semi-annually in
arrears on each Interest Payment Date, commencing February 15, 1998. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal from time
to time on demand at the rate borne by the Securities and on overdue
installments of interest (without regard to any applicable grace periods) to the
extent lawful.
2. Method of Payment.
The Company shall pay interest on the Securities (except
defaulted interest) to the persons who are the registered Holders at the close
of business on the Interest Record Date immediately preceding the Interest
Payment Date even if the Securities are canceled on registration of transfer or
registration of exchange after such Interest Record Date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Company shall
pay principal and premium, if any, and interest and Liquidated Damages, if any,
in money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Company
may pay principal and premium, if any, and interest and Liquidated Damages, if
any, by wire transfer of Federal funds (provided that the Paying Agent shall
have received wire instructions on or prior to the relevant Interest Record
Date), or interest by check payable in such U.S. Legal Tender. The Company may
deliver any such interest payment to the Paying Agent or to a Holder at the
Holder's registered address.
3. Paying Agent and Registrar.
Initially, State Street Bank and Trust Company (the "Trustee")
will act as Paying Agent and Registrar. The Company may change any Paying Agent
or Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar.
4. Indenture and Guarantees.
The Company issued the Securities under an Indenture, dated as
of August 18, 1997 (the "Indenture"), among the Company, Fedders Corporation, a
Delaware corporation and the sole stockholder of the Company (the "Guarantor"),
and the Trustee. Capitalized terms herein are used as defined in the Indenture
unless otherwise defined herein. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb) (the "TIA"),
as in effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstand-
B-3
100
ing anything to the contrary herein, the Securities are subject to all such
terms, and Holders of Securities are referred to the Indenture and the TIA for a
statement of them. The Securities are general obligations of the Company limited
in aggregate principal amount to $100,000,000.
5. Exchange Offer.
The Series B Securities were issued pursuant to an exchange
offer pursuant to which 9 3/8% Senior Subordinated Notes due 2007, Series A, of
the Company (the "Series A Securities"), in like principal amount and having
substantially identical terms as the Series B Securities, were exchanged for the
Series B Securities. The Series A Securities and the Series B Securities are
together referred to herein as the "Securities."
6. Optional Redemption.
The Securities will be redeemable at the option of the
Company, in whole or in part, at any time or from time to time, on or after
August 15, 2002 at the redemption prices (expressed as a percentage of principal
amount) set forth below, plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Redemption Date if redeemed during the twelve-month
period commencing on August 15 of the years set forth below:
Year Percentage
- ---- ----------
2002 104.688%
2003 103.125%
2004 101.563%
2005 and thereafter........ 100.000%
7. Optional Redemption upon Certain Equity Issuances.
At any time, or from time to time, prior to August 15, 2000,
the Company may redeem up to 30% of the originally issued principal amount of
Securities at a redemption price equal to 109.375% of the principal amount of
the Securities so redeemed, plus accrued and unpaid interest and Liquidated
Damages thereon, if any, to the redemption date, with the net proceeds of one or
more Equity Offerings; provided, however, that at least 70% of the originally
issued principal amount of Securities remains outstanding immediately after
giving effect to any such redemption and provided, further, that such redemption
will occur within 60 days of the date of the Closing of such Equity Offering.
8. Notice of Redemption.
Notice of redemption will be mailed by first-class mail at
least 30 days but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at its registered address. The Trustee may
select for redemption portions of the principal amount of Securities that have
denominations equal to or larger than $1,000 principal amount. Securities and
portions of them the Trustee so selects shall be in amounts of $1,000 principal
amount or integral multiples thereof.
If any Security is to be redeemed in part only, the notice of
redemption that relates to such Security shall state the portion of the
principal amount thereof to be redeemed. A new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the Holder
thereof upon cancellation of the original Security. On and after the Redemption
Date, interest will cease to accrue on Securities or portions thereof called for
redemption so long as the Company has deposited with the Paying Agent for the
Securities funds in satisfaction of the redemption price pursuant to the
Indenture.
B-4
101
9. Change of Control Offer.
Upon the occurrence of a Change of Control, the Company will
be required to offer to purchase all outstanding Securities at a purchase price
equal to 101% of the aggregate principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages thereon, if any, to the Change of Control
Purchase Date.
10. Limitation on Disposition of Assets.
The Company is, subject to certain conditions, obligated to
make an offer to purchase Securities at a purchase price equal to 100% of the
aggregate principal amount thereof, plus accrued and unpaid interest and
Liquidated Damages thereon, if any, to the Asset Sale Purchase Date.
11. Subordination.
The Indebtedness evidenced by the Securities is, to the extent
and in the manner provided in the Indenture, subordinated and subject in right
of payment to the prior payment in full in cash of all Senior Indebtedness as
defined in the Indenture, and this Security is issued subject to such
provisions. Each Holder of this Security, by accepting the same, (a) agrees to
and shall be bound by such provisions, (b) authorizes and directs the Trustee,
on behalf of such Holder, to take such action as may be necessary or appropriate
to effectuate the subordination as provided in the Indenture and (c) appoints
the Trustee attorney-in-fact of such Holder for such purpose.
12. Denominations; Transfer; Exchange.
The Securities are in registered form, without coupons, in
denominations of $1,000 and integral multiples of $1,000. A Holder shall
register the transfer or exchange of Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection therewith as
permitted by the Indenture. The Registrar need not register the transfer or
exchange of any Securities or portions thereof selected for redemption, except
the unredeemed portion of any security being redeemed in part.
13. Persons Deemed Owners.
The registered Holder of a Security shall be treated as the
owner of it for all purposes.
14. Unclaimed Funds.
If funds for the payment of principal or premium, if any, or
interest or Liquidated Damages, if any, remain unclaimed for two years, the
Trustee and the Paying Agent will repay the funds to the Company at its written
request. After that, all liability of the Trustee and such Paying Agent with
respect to such funds shall cease.
15. Legal Defeasance and Covenant Defeasance.
The Company and the Guarantor may be discharged from their
obligations under the Indenture, the Securities and the Guarantee except for
certain provisions thereof, and may be discharged from obligations to comply
with certain covenants contained in the Indenture, the Securities and the
Guarantee, in each case upon satisfaction of certain conditions specified in the
Indenture.
B-5
102
16. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture, the Securities
and the Guarantee may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or Event of Default or compliance
with any provision may be waived with the consent of the Holders of a majority
in aggregate principal amount of the Securities then outstanding. Without notice
to or consent of any Holder, the parties thereto may amend or supplement the
Indenture, the Securities and the Guarantee to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of Certificated Securities or comply with any
requirements of the Commission in connection with the qualification of the
Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
17. Restrictive Covenants.
The Indenture contains certain covenants that, among other
things, limit the ability of the Company and the Restricted Subsidiaries to make
Restricted Payments, to incur Indebtedness, to create Liens, to sell assets, to
permit restrictions on dividends and other payments by Restricted Subsidiaries
to the Company, to consolidate, merge or sell all or substantially all of its
assets or to engage in transactions with Affiliates. The limitations are subject
to a number of important qualifications and exceptions. The Company must
annually report to the Trustee on compliance with such limitations.
18. Defaults and Remedies.
If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in aggregate principal amount of Securities then
outstanding may declare all the Securities to be due and payable immediately in
the manner and with the effect provided in the Indenture. Holders of Securities
may not enforce the Indenture, the Securities or the Guarantee except as
provided in the Indenture. The Trustee is not obligated to enforce the
Indenture, the Securities or the Guarantee unless it has received indemnity
satisfactory to it. The Indenture permits, subject to certain limitations
therein provided, Holders of a majority in aggregate principal amount of the
Securities then outstanding to direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of Securities notice of certain
continuing Defaults or Events of Default if it determines that withholding
notice is in their interest.
19. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries or their respective Affiliates as if it
were not the Trustee.
20. No Recourse Against Others.
No stockholder, director, officer or employee of the Company
shall have any liability for any Obligation of the Company under the Securities
or the Indenture, or for any claim based on, in respect of, or by reason of,
such Obligations or their creation. Each Holder of a Security by accepting a
Security waives and releases all such liability. The waiver and release are part
of the consideration for the issuance of the Securities.
21. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent signs the certificate of authentication on this Security.
B-6
103
22. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a Holder of
a Security or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
23. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
24. Governing Law.
The laws of the State of New York shall govern the Indenture,
this Security and the Guarantee without regard to principles of conflicts of
laws.
B-7
104
[FORM OF NOTATION ON SECURITY RELATING TO GUARANTEE]
SENIOR SUBORDINATED GUARANTEE
Fedders Corporation (the "Guarantor") has unconditionally and
irrevocably guaranteed on a senior subordinated basis (such guarantee being
referred to herein as the "Guarantee") (i) the due and punctual payment of the
principal of and interest or premium or Liquidated Damages, if any, on the
Securities, whether on the Final Maturity Date, by acceleration, call for
redemption, upon a Change of Control Offer, upon an Asset Sale Offer or
otherwise, the due and punctual payment of interest on the overdue principal and
interest, if any, on the Securities and expenses, indemnification or otherwise,
and the due and punctual performance of all other obligations of the Company to
the Holders or the Trustee all in accordance with the terms set forth in Article
Eleven and Article Twelve of the Indenture and (ii) in case of any extension of
time of payment or renewal of any Securities or any of such other obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
The obligations of the Guarantor to the Holders and to the
Trustee pursuant to the Guarantee and the Indenture are expressly set forth and
are expressly subordinated and subject in right of payment to the prior payment
in full of all Guarantor Senior Indebtedness of the Guarantor, to the extent and
in the manner provided, in Article Eleven and Article Twelve of the Indenture,
and reference is hereby made to such Indenture for the precise terms of the
Guarantee therein made.
No director, officer, employee or stockholder, as such, of the
Guarantor shall have any liability under the Guarantee by reason of such
person's status as director, officer, employee or stockholder. Each holder of a
Security by accepting a Security waives and releases all such liability. The
waiver and release are part of the consideration for the issuance of the
Guarantee Indebtedness.
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.
FEDDERS CORPORATION
By:
----------------------------------
Name:
Title:
B-8
105
ASSIGNMENT FORM
I or we assign and transfer this Security to
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee or transferee)
- -------------------------------------------------------------------------------
(Insert Social Security or other identifying number of assignee or transferee)
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:
--------------- ----------------------------------
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:
-----------------------------------------------------------
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
B-9
106
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.05 or Section 4.14 of the Indenture, check the
appropriate box:
Section 4.05 [ ]
Section 4.14 [ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 4.05 or Section 4.14 of the
Indenture, state the amount: $
-------------
Dated: Your Signature:
--------------- ----------------------------------
(Signed exactly as name appears
on the other side of this Security)
Signature Guarantee:
-----------------------------------------------------------
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
B-10
107
EXHIBIT C
---------
FORM OF LEGEND FOR GLOBAL SECURITIES
Any Global Security authenticated and delivered hereunder
shall bear a legend (which would be in addition to any other legends required in
the case of a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS
SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY
BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
C-1
108
EXHIBIT D
---------
Form of Certificate To Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
---------------, ----
State Street Bank and Trust Company
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc. (the "Company")
Indenture (the "Indenture") relating to 9 3/8% Senior
Subordinated Notes due 2007, Series A, or 9 3/8% Senior
Subordinated Notes due 2007, Series B
Ladies and Gentlemen:
In connection with our proposed purchase of 9 3/8% Senior
Subordinated Notes due 2007, Series A, or 9 3/8% Senior Subordinated Notes due
2007, Series B (the "Securities"), of the Company, we confirm that:
1. We have received such information as we deem necessary in
order to make our investment decision.
2. We understand that any subsequent transfer of the
Securities is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Securities except in
compliance with, such restrictions and conditions and the Securities
Act of 1933, as amended (the "Securities Act").
3. We understand that the offer and sale of the Securities
have not been registered under the Securities Act, and that the
Securities may not be offered or sold within the United States or to,
or for the account or benefit of, U.S. persons except as permitted in
the following sentence. We agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, that if we
should sell any Securities, we will do so only (A) to the Company or
any subsidiary thereof, (B) inside the United States in accordance with
Rule 144A under the Securities Act to a "qualified institutional buyer"
(as defined therein), (C) inside the United States to an institutional
"accredited investor" (as defined below) that, prior to such transfer,
furnishes (or has furnished on its behalf by a U.S. broker-dealer) to
the Trustee a signed letter substantially in the form hereof, (D)
outside the United States in accordance with Regulation S under the
Securities Act, (E) pursuant to the exemption from registration
provided by Rule 144 under the Securities Act (if available), or (F)
pursuant to an effective registration statement under the Securities
Act, and we further agree to provide to any person purchasing
Securities from us a notice advising such purchaser that resales of the
Securities are restricted as stated herein.
4. We understand that, on any proposed resale of Securities,
we will be required to furnish to the Trustee and the Company such
certification, legal opinions and other information as the Trustee and
the Company may reasonably require to confirm that the proposed sale
complies with the foregoing restrictions. We further understand that
the Securities purchased by us will bear a legend to the foregoing
effect.
D-1
109
5. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of our
investment in the Securities, and we and any accounts for which we are
acting are each able to bear the economic risk of our or their
investment, as the case may be.
6. We are acquiring the Securities purchased by us for our
account or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole investment
discretion.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
--------------------------------------
[Authorized Signatory]
D-2
110
EXHIBIT E
---------
[FORM OF CERTIFICATION TO BE GIVEN BY HOLDERS OF
BENEFICIAL INTEREST IN A TEMPORARY
REGULATION S GLOBAL SECURITY
TO EUROCLEAR OR CEDEL]
OWNER SECURITIES CERTIFICATION
FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Notes due 2007
CUSIP No. U 31334AA0
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This is to certify that, as of the date hereof, $ of the
above-captioned Securities (the "Securities") are beneficially owned by non-U.S.
person(s). As used in this paragraph, the term "U.S. person" has the meaning
given to it by Regulation S under the Securities Act of 1933, as amended.
We undertake to advise you promptly by tested telex on or
prior to the date on which you intend to submit your certification relating to
the Securities held by you for our account in accordance with your operating
procedures if any applicable statement herein is not correct on such date, and
in the absence of any such notification it may be assumed that this
certification applies as of such date.
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceedings.
This certificate and the statements contained herein are made for your benefit
and the benefit of the Issuer, the Guarantor and the Initial Purchasers.
Dated:
-----------, -----
By:
----------------------------------------
As, or as agent for, the beneficial
owner(s) of the Securities to which this
certificate relates.
E-1
111
EXHIBIT F
---------
[FORM OF CERTIFICATION TO BE GIVEN
BY THE EUROCLEAR OPERATOR OR
CEDEL BANK, SOCIETE ANONYME]
DEPOSITORY SECURITIES CERTIFICATION
FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Notes due 2007
CUSIP No. U 31334AA0
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This is to certify that, with respect to U.S.$
principal amount of the above-captioned Securities (the "Securities"), except as
set forth below, we have received in writing, by tested telex or by electronic
transmission, from member organizations appearing in our records as persons
being entitled to a portion of the principal amount of the Securities (our
"Member Organizations"), certifications with respect to such portion,
substantially to the effect set forth in this Indenture.(1)
We further certify (i) that we are not making available
herewith for exchange (or, if relevant, exercise of any rights or collection of
any interest) any portion of the Temporary Regulation S Global Security excepted
in such certifications and (ii) that as of the date hereof we have not received
any notification from any of our Member Organizations to the effect that the
statements made by such Member Organizations with respect to any portion of the
part submitted herewith for exchange (or, if relevant, exercise of any rights or
collection of any interest) are no longer true and cannot be relied upon as of
the date hereof.
- ------------------------
(1) Unless Morgan Guaranty Trust Company of New York, London Branch is
otherwise informed by the Agent, the long form certificate set out in
the Operating Procedures will be deemed to meet the requirements of
this sentence.
F-1
112
We understand that this certification is required in
connection with certain securities laws of the United States. In connection
therewith, if administrative or legal proceedings are commenced or threatened in
connection with which this certification is or would be relevant, we irrevocably
authorize you to produce this certification to any interested party in such
proceedings. This certificate and the statements contained herein are made for
your benefit and the benefit of the Issuer, the Guarantor and the Initial
Purchasers.
Dated:
---------,------
Yours faithfully,
[MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as operator of the Euroclear System]
or
[CEDEL BANK, SOCIETE ANONYME]
By:
----------------------------------------
F-2
113
EXHIBIT G
---------
[FORM OF CERTIFICATION TO BE GIVEN BY
TRANSFEREE OF BENEFICIAL INTEREST IN A
TEMPORARY REGULATION S GLOBAL SECURITY]
TRANSFEREE SECURITIES CERTIFICATION
FEDDERS NORTH AMERICA, INC.
9 3/8% Senior Subordinated Notes due 2007
CUSIP No. U 31334AA0
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
For purposes of acquiring a beneficial interest in the
Temporary Regulation S Global Security, the undersigned certifies that it is not
a U.S. Person as defined by Regulation S under the Securities Act of 1933, as
amended.
We undertake to advise you promptly by tested telex on or
prior to the date on which you intend to submit your certification relating to
the Securities held by you in which we intend to acquire a beneficial interest
in accordance with your operating procedures if any applicable statement herein
is not correct on such date, and in the absence of any such notification it may
be assumed that this certification applies as of such date.
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, the Guarantor and the Initial Purchasers.
Dated:
----------------,-----
By:
--------------------------------------------
As, or as agent for, the beneficial acquiror
of the Securities to which this certificate
relates.
G-1
114
EXHIBIT H
---------
FORM OF CERTIFICATION FOR TRANSFER OR
EXCHANGE OF RESTRICTED GLOBAL SECURITY
TO TEMPORARY REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to U.S. $ aggregate principal
amount of Securities which are held in the form of the Restricted Global
Security (CUSIP No. 313139AA5) with the Depository in the name of [insert name
of transferor] (the "Transferor"). The Transferor has requested a transfer of
such beneficial interest in the Securities to a Person who will take delivery
thereof in the form of an equal aggregate principal amount of Securities
evidenced by the Temporary Regulation S Global Security (CUSIP No. U31334AA0) to
be held with the Depository in the name of [Euroclear] [Cedel Bank, societe
anonyme].
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that such transfer has been
effected in accordance with the transfer restrictions set forth in the
Securities and pursuant to and in accordance with Regulation S under the
Securities Act of 1933, as amended (the "Securities Act"), and accordingly the
Transferor does hereby certify that:
(1) the offer of the Securities was not made to a person in
the United States;
[(2) at the time the buy order was originated, the transferee
was outside the United States or the Transferor and any person acting
on its behalf reasonably believed that the transferee was outside the
United States;]
[(2) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither the
Transferor nor any person acting on our behalf knows that the
transaction was pre-arranged with a buyer in the United States;](2)
- ---------------------
(2) Insert one of these two provisions, which come from the definition of
"offshore transaction" in Regulation S.
H-1
115
(3) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(5) upon completion of the transaction, the beneficial
interest being transferred as described above is to be held with the
Depository in the name of [Euroclear] [Cedel Bank, societe anonyme].
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, the Guarantor and the Initial Purchasers.
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
---------------------------
cc: Fedders North America, Inc.
H-2
116
EXHIBIT I
---------
FORM OF CERTIFICATION FOR TRANSFER OR EXCHANGE OF
RESTRICTED GLOBAL SECURITY TO
PERMANENT REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to U.S.$ aggregate principal
amount of Securities which are held in the form of the Restricted Global
Security (CUSIP No. 313139AA5) with the Depository in the name of [insert name
of transferor] (the "Transferor"). The Transferor has requested a transfer of
such beneficial interest in the Securities to a Person who will take delivery
thereof in the form of an equal aggregate principal amount of Securities
evidenced by the Permanent Regulation S Global Security (CUSIP No. U31334AA0).
In connection with such request, and in respect of such
Securities, the Transferor does hereby certify that such transfer has been
effected in accordance with the transfer restrictions set forth in the
Securities and,
(1) with respect to transfers made in reliance on Regulation S
under the Securities Act of 1933, as amended (the "Securities Act"), the
Transferor does hereby certify that:
(A) the offer of the Securities was not made to a person in
the United States;
[(B) (at the time the buy order was originated, the transferee
was outside the United States or the Transferor and any person acting
on its behalf reasonably believed that the transferee was outside the
United States;]
[(B) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither the
Transferor nor any person acting on our behalf knows that the
transaction was pre-arranged with a buyer in the United States;](3)
- --------------------
(3) Insert one of these two provisions, which come from the definition of
"offshore transactions" in Regulation S.
I-1
117
(C) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or 904(b) of
Regulation S, as applicable; and
(D) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act; and
(2) with respect to transfers made in reliance on Rule 144
under the Securities Act, the Transferor does hereby certify that the Securities
are being transferred in a transaction permitted by Rule 144 under the
Securities Act.
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, the Guarantor and the Initial Purchasers.
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
---------------------------
cc: Fedders North America, Inc.
I-2
118
EXHIBIT J
---------
FORM OF CERTIFICATION FOR TRANSFER OR EXCHANGE OF
TEMPORARY REGULATION S GLOBAL SECURITY
OR PERMANENT REGULATION S GLOBAL SECURITY TO
RESTRICTED GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to U.S.$ principal amount of
Securities which are evidenced by an aggregate [Temporary Regulation S Global
Security (CUSIP No. U31334AA0)] [Permanent Regulation S Global Security (CUSIP
No. U31334AA0)] and held with the Depository through [Euroclear] [Cedel] (Common
Code ) in the name of [insert name of transferor] (the "Transferor").
The Transferor has requested a transfer of such beneficial interest in
Securities to a person that will take delivery thereof in the form of an equal
principal amount of Securities evidenced by a Restricted Global Security of the
same series and of like tenor as the Securities (CUSIP No. 313139AA5).
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that such transfer is being
effected pursuant to and in accordance with Rule 144A under the Securities Act
and, accordingly, the Transferor does hereby further certify 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 each case in a transaction meeting the requirements of
Rule 144A and in accordance with any applicable securities laws of any state of
the United States.
J-1
119
This certificate and the statements contained herein are made
for your benefit and the benefit of the Issuer, the Guarantor and the Initial
Purchasers.
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
Dated:
---------------------------
cc: Fedders North America, Inc.
J-2
120
EXHIBIT K-1
-----------
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL RESTRICTED SECURITY TO
RESTRICTED GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to $ principal amount of
Restricted Securities held in definitive form (CUSIP No. ) by [insert
name of transferor] (the "Transferor"). The Transferor has requested an exchange
or transfer of such Securities.
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that (i) such Securities are
owned by the Transferor and are being exchanged without transfer or (ii) such
transfer has been effected pursuant to and in accordance with Rule 144A or Rule
144 under the United States Securities Act of 1933, as amended (the "Securities
Act") and accordingly the Transferor does hereby further certify that:
(1) if the transfer has been effected pursuant to
Rule 144A:
(A) 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;
(B) such Person and each such account is a "qualified
institutional buyer" within the meaning of Rule 144A; and
(C) the Securities have been transferred in a
transaction meeting the requirements of Rule 144A and in
accordance with any applicable securities laws of any state of
the United States; or
(2) if the transfer has been effected pursuant to
Rule 144:
(A) more than two years has elapsed since the date of
the closing of the initial placement of the Securities
pursuant to the Purchase Agreement; and
K-1-1
121
(B) the Securities have been transferred in a
transaction permitted by Rule 144 and made in accordance with
any applicable securities laws of any state of the United
States.
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, the Guarantor and the Initial Purchasers.
Dated:
---------------'------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
cc: Fedders North America, Inc.
K-1-2
122
EXHIBIT K-2
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL RESTRICTED SECURITY TO
PERMANENT REGULATION S GLOBAL SECURITY
OR TEMPORARY REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to $ principal amount of
Restricted Securities held in definitive form (CUSIP No. ) by [insert
name of transferor] (the "Transferor"). The Transferor has requested an exchange
or transfer of such Securities.
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that (i) such Securities are
owned by the Transferor and are being exchanged without transfer or (ii) such
transfer has been effected pursuant to and in accordance with (a) Rule 903 or
Rule 904 under the Securities Act of 1933, as amended (the "Securities Act"), or
(b) Rule 144 under the Securities Act, and accordingly the Transferor does
hereby further certify that:
(1) if the transfer has been effected pursuant to
Rule 903 or Rule 904:
(A) the offer of the Securities was not made to a person
in the United States;
(B) either;
(i) at the time the buy order was originated, the
transferee was outside the United States or the Transferor and
any person acting on its behalf reasonably believed that the
transferee was outside the United States, or
(ii) the transaction was executed in, on or through
the facilities of a designated offshore securities market and
neither the Transferor nor any person acting on its behalf
knows that the transaction was pre-arranged with a buyer in
the United States;
(C) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or 904(b) of
Regulation S, as applicable;
K-2-1
123
(D) the transaction is not part of a plan or scheme to evade
the registration requirements of the Act; and
(E) if such transfer is to occur during the Restricted Period,
upon completion of the transaction, the beneficial interest being
transferred as described above was held with the Depository through
[Euroclear] [CEDEL]; or
(2) if the transfer has been effected pursuant to Rule 144:
(A) more than two years has elapsed since the date of the
closing of the initial placement of the Securities pursuant to the
Purchase Agreement; and
(B) the Securities have been transferred in a transaction
permitted by Rule 144 and made in accordance with any applicable
securities laws of any state of the United States.
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, the Guarantor and the Initial Purchasers.
Dated:
---------------'------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
cc: Fedders North America, Inc.
K-2-2
124
EXHIBIT L-1
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL PERMANENT REGULATION S
SECURITY TO RESTRICTED GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to $ principal amount of
Restricted Securities held in definitive form (CUSIP No. ) by [insert
name of transferor] (the "Transferor"). The Transferor has requested an exchange
or transfer of such Securities.
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that (i) such Securities are
owned by the Transferor and are being exchanged without transfer or (ii) such
transfer has been effected pursuant to and in accordance with Rule 144A under
the Securities Act, and accordingly the Transferor does hereby further certify
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 each case in a transaction meeting
the requirements of Rule 144A and in accordance with any applicable securities
laws of any state of the United States.
L-1-1
125
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, the Guarantor and the Initial Purchasers.
Dated:
---------------'------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
cc: Fedders North America, Inc.
L-1-2
126
EXHIBIT L-2
FORM OF CERTIFICATION FOR TRANSFER
OR EXCHANGE OF NON-GLOBAL PERMANENT REGULATION S
SECURITY TO PERMANENT REGULATION S GLOBAL SECURITY
State Street Bank and Trust Company,
as Trustee
Two International Place
Boston, Massachusetts 02110
Attention: Corporate Trust Department
Re: Fedders North America, Inc.
9 3/8% Senior Subordinated Notes
due 2007 (the "Securities")
Reference is hereby made to the Indenture, dated as of August
18, 1997 (the "Indenture"), by and among Fedders North America, Inc., as Issuer,
Fedders Corporation, as Guarantor, and State Street Bank and Trust Company, as
Trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in this Indenture.
This letter relates to $ principal amount of
Restricted Securities held in definitive form (CUSIP No. ) by [insert
name of transferor] (the "Transferor"). The Transferor has requested an exchange
or transfer of such Securities.
In connection with such request and in respect of such
Securities, the Transferor does hereby certify that (i) such Securities are
owned by the Transferor and are being exchanged without transfer or (ii) such
transfer has been effected pursuant to and in accordance with (a) Rule 903 or
Rule 904 under the Securities Act of 1933, as amended (the "Securities Act"), or
(b) Rule 144 under the Securities Act, and accordingly the Transferor does
hereby further certify that:
(1) if the transfer has been effected pursuant to Rule 903 or
Rule 904:
(A) the offer of the Securities was not made to a
person in the United States;
(B) either;
(i) at the time the buy order was
originated, the transferee was outside the United
States or the Transferor and any person acting on its
behalf reasonably believed that the transferee was
outside the United States, or
(ii) the transaction was executed in, on or
through the facilities of a designated offshore
securities market and neither the Transferor nor any
person acting on its behalf knows that the
transaction was pre-arranged with a buyer in the
United States;
(C) no directed selling efforts have been made in
contravention of the requirements of Rule 903(b) or 904 (b) of
Regulation S, as applicable;
L-2-1
127
(D) the transaction is not part of a plan or scheme
to evade the registration requirements of the Act; and
(E) if such transfer is to occur during the
Restricted Period, upon completion of the transaction, the
beneficial interest being transferred as described above was
held with the Depository through [Euroclear] [CEDEL]; or
(2) if the transfer has been effected pursuant to Rule 144:
(A) more than two years has elapsed since the date of
the closing of the initial placement of the Securities
pursuant to the Purchase Agreement; and
(B) the Securities have been transferred in a
transaction permitted by Rule 144 and made in accordance with
any applicable securities laws of any state of the United
States.
We understand that this certificate is required in connection
with certain securities laws of the United States. In connection therewith, if
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate to any interested party in such proceeding. This
certificate and the statements contained herein are made for your benefit and
the benefit of the Issuer, Guarantor and the Initial Purchasers.
Dated:
---------------'------
[Insert Name of Transferor]
By:
--------------------------------------
Name:
Title:
cc: Fedders North America, Inc.
L-2-2