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EXHIBIT 4.1
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COLTEC INDUSTRIES INC
ISSUER
7 1/2% Senior Notes Due 2008
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INDENTURE
Dated as of April 16, 1998
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BANKERS TRUST COMPANY
TRUSTEE
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CROSS-REFERENCE TABLE
INDENTURE
TIA SECTION SECTION
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310 (a) (1) ....................................................... 7.10
(a) (2) ....................................................... 7.10
(a) (3) ....................................................... N.A.
(a) (4) ....................................................... N.A.
(b) ............................................................ 7.8; 7.10
(c) ............................................................ N.A.
311 (a) ............................................................ 7.11
(b) ............................................................ 7.11
(c) ............................................................ N.A.
312 (a) ............................................................ 2.5
(b) ............................................................ 12.3
(c) ............................................................ 12.3
313 (a) ............................................................ 7.6
(b) (1) ....................................................... N.A.
(b) (2) ....................................................... 7.6
(c) ............................................................ 7.6
(d) ............................................................ 7.6
314 (a) ............................................................ 4.10
4.4; 12.2
(b) ............................................................ 11.2
(c) (1) ....................................................... 12.4
(c) (2) ....................................................... 12.4
(c) (3) ....................................................... N.A.
(d) ............................................................ 11.2; 11.3
(e) ............................................................ 12.5
(f) ............................................................ 4.10
315 (a) ............................................................ 7.1
(b) ............................................................ 7.5; 12.2
(c) ............................................................ 7.1
(d) ............................................................ 7.1
(e) ............................................................ 6.11
316 (a) (last sentence) ........................................... 12.6
(a) (1) (A) ................................................... 6.5
(a) (1) (B) ................................................... 6.4
(a) (2)......................................................... N.A.
(b) ............................................................ 6.7
317 (a) (1) ....................................................... 6.8
(a) (2) ....................................................... 6.9
(b) ............................................................ 2.4
318 (a) ............................................................ 12.1
N.A. means Not Applicable.
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Note: This Cross-Reference Table shall not, for any purpose, be deemed to
be part of the Indenture.
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TABLE OF CONTENTS
ARTICLE I
Definitions and Incorporation by Reference..................
SECTION 1.1. Definitions.................................................
SECTION 1.2. Other Definitions...........................................
SECTION 1.3. Incorporation by Reference of Trust Indenture Act...........
SECTION 1.4. Rules of Construction.......................................
SECTION 1.5. One Class of Securities.....................................
ARTICLE II
The Securities..............................................
SECTION 2.1. Form and Dating.............................................
SECTION 2.2. Execution and Authentication................................
SECTION 2.3. Registrar and Paying Agent..................................
SECTION 2.4. Paying Agent To Hold Money in Trust.........................
SECTION 2.5. Securityholder Lists........................................
SECTION 2.6. [Intentionally Omitted].....................................
SECTION 2.7. Replacement Securities......................................
SECTION 2.8. Outstanding Securities......................................
SECTION 2.9. Temporary Securities........................................
SECTION 2.10. Cancellation................................................
SECTION 2.11. Defaulted Interest..........................................
SECTION 2.12. CUSIP Numbers...............................................
ARTICLE III
Redemption..................................................
SECTION 3.1. Notices to Trustee..........................................
SECTION 3.2. Selection of Securities To Be Redeemed......................
SECTION 3.3. Notice of Redemption........................................
SECTION 3.4. Effect of Notice of Redemption..............................
SECTION 3.5. Deposit of Redemption Price.................................
SECTION 3.6. Securities Redeemed in Part.................................
ARTICLE IV
Covenants...................................................
SECTION 4.1. Payment of Securities.......................................
SECTION 4.2. Limitations on Liens........................................
SECTION 4.3. Limitation on Sale and Lease-Back Transactions..............
SECTION 4.4. Compliance Certificate......................................
SECTION 4.5. Further Instruments and Acts................................
SECTION 4.6. Maintenance of Office or Agency.............................
SECTION 4.7. SEC Reports.................................................
ARTICLE V
Successor Company...........................................
SECTION 5.1. When the Company May Merge or Transfer Assets...............
ARTICLE VI
Defaults and Remedies.......................................
SECTION 6.1. Events of Default...........................................
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SECTION 6.2. Acceleration................................................
SECTION 6.3. Other Remedies..............................................
SECTION 6.4. Waiver of Past Defaults.....................................
SECTION 6.5. Control by Majority.........................................
SECTION 6.6 Limitation on Suits.........................................
SECTION 6.7. Rights of Holders To Receive Payment........................
SECTION 6.8. Collection Suit by Trustee..................................
SECTION 6.9. Trustee May File Proofs of Claim............................
SECTION 6.10. Priorities..................................................
SECTION 6.11. Undertaking for Costs.......................................
SECTION 6.12. Waiver of Stay or Extension Laws............................
ARTICLE VII
Trustee.....................................................
SECTION 7.1. Duties of Trustee...........................................
SECTION 7.2. Rights of Trustee...........................................
SECTION 7.3. Individual Rights of Trustee................................
SECTION 7.4 Trustee's Disclaimer........................................
SECTION 7.5. Notice of Defaults..........................................
SECTION 7.6. Reports by Trustee to Holders...............................
SECTION 7.7. Compensation and Indemnity..................................
SECTION 7.8. Replacement of Trustee......................................
SECTION 7.9. Successor Trustee by Merger.................................
SECTION 7.10. Eligibility; Disqualification...............................
SECTION 7.11. Preferential Collection of Claims Against Company...........
ARTICLE VIII
Discharge of Indenture; Defeasance..........................
SECTION 8.1 Discharge of Liability on Securities; Defeasance............
SECTION 8.2 Conditions to Defeasance....................................
SECTION 8.3 Application of Trust Money..................................
SECTION 8.4 Repayment to Company........................................
SECTION 8.5 Indemnity for Government Obligations........................
SECTION 8.6 Reinstatement...............................................
ARTICLE IX
Amendments..................................................
SECTION 9.1 Without Consent of Holders..................................
SECTION 9.2 With Consent of Holders.....................................
SECTION 9.3 Compliance with Trust Indenture Act.........................
SECTION 9.4 Revocation and Effect of Consents and Waivers...............
SECTION 9.5 Notation on or Exchange of Securities.......................
SECTION 9.6 Trustee To Sign Amendments..................................
SECTION 9.7 Payment for Consent.........................................
ARTICLE X
Subsidiary Guarantee........................................
SECTION 10.1 Subsidiary Guarantee........................................
SECTION 10.2 Limitation on Liability.....................................
SECTION 10.3 Successors and Assigns......................................
SECTION 10.4 No Waiver...................................................
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SECTION 10.5 Right of Contribution.......................................
SECTION 10.6 No Subrogation..............................................
SECTION 10.7 Additional Subsidiary Guarantors............................
SECTION 10.8 Modification................................................
SECTION 10.9 Release of Subsidiary Guarantor.............................
SECTION 10.10 Merger, Consolidation and Sale of Assets of a Subsidiary
Guarantor...................................................
ARTICLE XI
Collateral and Security.....................................
SECTION 11.1 Collateral Documents........................................
SECTION 11.2 Opinions....................................................
SECTION 11.3 Release and Substitution of Collateral; Amendment of
Collateral Documents........................................
SECTION 11.4 Certificates of the Company.................................
SECTION 11.5. Authorization of Actions to be Taken by the Trustee Under
the Collateral..............................................
SECTION 11.6. Authorization of Receipt of Funds by the Trustee Under the
Collateral Documents........................................
SECTION 11.7 Release Upon Termination of the Company's Obligations.......
SECTION 11.8. Security Agreement Collateral...............................
ARTICLE XII
Miscellaneous...............................................
SECTION 12.1. Trust Indenture Act Controls................................
SECTION 12.2. Notices.....................................................
SECTION 12.3. Communication by Holders with other Holders.................
SECTION 12.4. Certificate and Opinion as to Conditions Precedent..........
SECTION 12.5. Statements Required in Certificate or Opinion...............
SECTION 12.6. When Securities Disregarded.................................
SECTION 12.7. Rules by Trustee, Paying Agent and Registrar................
SECTION 12.8. Legal Holidays..............................................
SECTION 12.9. Governing Law...............................................
SECTION 12.10. No Recourse Against Others..................................
SECTION 12.11. Successors..................................................
SECTION 12.12. Multiple Originals..........................................
SECTION 12.13. Qualification of Indenture..................................
SECTION 12.14. Table of Contents; Headings.................................
Rule 144A/Regulation S Appendix.............................................
Exhibit A -- Form of Exchange Security and Private Exchange Security........
Exhibit B -- Form of Collateral Agent Acknowledgment........................
Exhibit C -- Form of Company Pledge Agreement...............................
Exhibit D -- Form of Subsidiaries Pledge Agreement..........................
Exhibit E -- Form of Company Security Agreement.............................
Exhibit F -- Form of Subsidiaries Security Agreement........................
Exhibit G -- Form of Mortgage Amendment.....................................
Exhibit H -- Form of Guarantor Supplement...................................
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INDENTURE, dated as of April 16, 1998, among COLTEC INDUSTRIES INC, a
Pennsylvania corporation (as further defined below, the "Company"), the
Subsidiary Guarantors (as defined herein) and Bankers Trust Company, a New York
banking corporation, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Company's 7 1/2% Senior
Notes Due 2008 (the "Initial Securities") and, if and when issued in exchange
for Initial Securities as provided in the Registration Rights Agreement (as
hereinafter defined in the Rule 144A/Regulation S Appendix), the Company's
Series B 7 1/2% Senior Notes Due 2008 (the "Exchange Securities") and if and
when issued pursuant to a private exchange for Initial Securities, the Company's
Series C 7 1/2% Senior Notes Due 2008 (the "Private Exchange Securities" and,
together with the Initial Securities and the Exchange Securities, the
"Securities"):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. DEFINITIONS.
"ATTRIBUTABLE DEBT" means in connection with a sale and lease-back
transaction, the lesser of (a) the fair market value of the assets subject to
such transaction and (b) the present value (discounted at a rate per annum equal
to the average interest borne by all outstanding securities issued under this
Indenture determined on a weighted average basis and compounded semiannually) of
the obligations of the lessee for rental payments during the term of the related
lease.
"BOARD OF DIRECTORS" means, with respect to any Person, the Board of
Directors of such Person or any committee thereof duly authorized to act on
behalf of such Board of Directors.
"BUSINESS DAY" means a day other than a Saturday, Sunday or other day on
which banking institutions in New York City are authorized or required by law to
close.
"CAPITAL LEASE" means any Indebtedness represented by a lease obligation of
a person incurred with respect to real property or equipment acquired or leased
by such person and used in its business that is required to be recorded as a
capital lease in accordance with GAAP.
"CAPITAL STOCK" of any Person means any and all shares, interests,
participations, rights to purchase, warrants, options or other equivalents
(however designated) of corporate stock or other equity of such Person.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" means the collective reference to all of the property and
assets that are from time to time subject to the Liens of the Collateral
Documents.
"COLLATERAL AGENT" means Bankers Trust Company, acting in its capacity as
agent with respect to the Collateral for the secured creditors under the
Collateral Documents, including, without limitation, the Holders of the
Securities and the lenders under the Credit Agreement, or any successor thereto.
"COLLATERAL AGENT ACKNOWLEDGMENT" means the agreement, dated as of March
16, 1998, between the Trustee, on behalf of the Holders of the Securities, and
Bankers Trust Company, acting in its capacity as Collateral Agent, substantially
in the form of Exhibit B, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the provisions thereof.
"COLLATERAL DOCUMENTS" means the collective reference to the Company Pledge
Agreement, the Subsidiaries Pledge Agreement, the Company Security Agreement,
the Subsidiaries Security Agreement, the Mortgages, and any other security
agreement, pledge agreement, mortgage, deed of trust or other agreement,
instrument or document which may be entered into or delivered after the date of
this Indenture in favor of the Collateral Agent to secure the obligations
thereunder and any other instruments, agreements or documents entered into or
delivered in connection with any of the foregoing, as such agreements,
instruments or documents may be amended, supplemented or otherwise modified from
time to time in accordance with the terms thereof.
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"COMPANY PLEDGE AGREEMENT" means the pledge agreement, dated as of March
24, 1992, as amended and restated as of December 18, 1996, and as further
amended and restated as of March 16, 1998 in connection with the offering of the
Securities, made by the Company to Bankers Trust Company, as Collateral Agent,
substantially in the form of Exhibit C, as the same may be amended, supplemented
or otherwise modified from time to time in accordance with the provisions
thereof.
"COMPANY SECURITY AGREEMENT" means the security agreement, dated as of
March 24, 1992, as amended and restated as of December 18, 1996, and as further
amended and restated as of March 16, 1998 in connection with the offering of the
Securities, made by the Company to Bankers Trust Company, as Collateral Agent,
substantially in the form of Exhibit E, as the same may be amended, supplemented
or otherwise modified from time to time in accordance with the provisions
thereof.
"CONSOLIDATED NET ASSETS" means as of any particular time the aggregate
amount of assets after deducting therefrom all current liabilities except for
(a) notes and loans payable, (b) current maturities of long-term debt and (c)
current maturities of obligations under capital leases, all as set forth on the
most recent consolidated balance sheet of the Company and its consolidated
Subsidiaries and computed in accordance with GAAP.
"CORPORATE TRUST OFFICE" shall mean the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered
which office at the date of the execution of this Indenture is located at Four
Albany Street, New York, New York 10006, Attention: Corporate Trust and Agency
Group or at any other time at time such other address as the Trustee may
designate from time to time by notice to the Holders.
"CREDIT AGREEMENT" means the Amended and Restated Credit Agreement, dated
as of March 24, 1992, as amended and restated as of January 11, 1994 and further
as amended and restated as of December 18, 1996, as amended by the Fifth
Amendment thereto, dated as of March 16, 1998, among the Company, Coltec
Aerospace Canada Limited, a Subsidiary of the Company, Bankers Trust Company, as
Administrative Agent, Bank of America National Trust and Savings Association, as
Documentation Agent, The Chase Manhattan Bank, as Syndication Agent, Bank of
Montreal, as Canadian Paying Agent, and the various lenders party thereto, as
such agreement may be amended (including any amendment, restatement and
successors thereof), supplemented, refinanced, renewed, extended, replaced, in
whole or in part, or otherwise modified from time to time, including any
increase in the principal amount of the obligations thereunder.
"DEFAULT" means any event as defined in Section 6.1 herein which is, or
after notice or passage of time or both would be, an Event of Default.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXEMPTED DEBT" means the sum of the following as of the date of
determination: (i) Indebtedness of the Company and its Subsidiaries (other than
Foreign Subsidiaries) incurred after the Issue Date and secured by Liens not
otherwise permitted by Section 4.2 and (ii) Attributable Debt of the Company and
its Subsidiaries in respect of sale and lease-back transactions entered into
after the Issue Date, other than sale and lease-back transactions permitted by
clauses (a) and (c) of Section 4.3.
"FOREIGN SUBSIDIARY" means any Subsidiary which is incorporated or
otherwise organized under the laws of any jurisdiction other than the United
States of America, any state thereof or the District of Columbia and any
Subsidiary thereof.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect as of the Issue Date, including those set forth in (i)
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (ii) statements and
pronouncements of the Financial Accounting Standards Board, (iii) such other
statements by such other entity as approved by a significant segment of the
accounting profession and (iv) the rules and regulations of the SEC governing
the inclusion of financial statements (including pro forma financial statements)
in periodic reports required to be filed pursuant to Section 13 of the Exchange
Act, including opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the SEC.
"GUARANTEE" means a guarantee, direct or indirect, in any manner
(including, without limitation, letters of credit and reimbursement agreements
in respect thereof), of all or any part of any Indebtedness; provided,
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however, that the term "Guarantee" shall not include endorsements for collection
or deposit in the ordinary course of business. The term "Guarantee" used as a
verb has a corresponding meaning.
"HOLDER" or "SENIOR NOTEHOLDER" or "SECURITYHOLDER" means the Person in
whose name a Senior Note is registered on the Registrar's books.
"INDEBTEDNESS" means, with respect to any Person, without duplication, (i)
principal of, and premium, if any, and interest (including interest accruing on
or after the filing of any petition in bankruptcy or for reorganization relating
to such Person, whether or not a claim for such post-petition interest is
allowed in such proceeding) on any indebtedness of such Person (A) for borrowed
money (whether or not the recourse of the lender is to the whole of the assets,
of such person or only to a portion thereof), (B) evidenced by notes, debentures
or similar instruments (including purchase money obligations) given in
connection with the acquisition of any property or assets (other than trade
accounts payable for inventory or similar property acquired in the ordinary
course of business), including securities, for the payment of which such Person
is liable, directly or indirectly, or the payment of which is secured by a lien,
charge or encumbrance on property or assets of such Person, (C) for goods,
materials or services purchased in the ordinary course of business (other than
trade accounts payable arising in the ordinary course of business), (D) with
respect to letters of credit or bankers acceptances issued for the account of
such Person or performance, surety or similar bonds, (E) for the payment of
money relating to a Capital Lease obligation or (F) under interest rate swaps,
caps or similar agreements and foreign exchange contracts, currency swaps or
similar agreements; (ii) any liability of any other Person of the kind described
in the preceding clause (i), which such Person has Guaranteed or which is
otherwise its legal liability; and (iii) any and all deferrals, renewals,
extensions and refunding of, or amendments, modifications or supplements to, any
indebtedness of the kind described in any of the preceding clauses (i) or (ii).
"INDENTURE" means this Indenture, as amended or supplemented from time to
time.
"ISSUE DATE" means the date on which the Initial Securities are originally
issued.
"LEGAL HOLIDAY" has the meaning ascribed in Section 12.8.
"LIEN" means any lien, security interest, charge or encumbrance of any kind
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, and any agreement to give any security interest).
"MORTGAGES" means each of the mortgages or deeds of trust, in each case
dated as of March 24, 1992, as amended and restated as of January 11, 1994, as
further amended and restated as of December 18, 1996, and as further amended as
of March 16, 1998 which amendment shall be substantially in the form of Exhibit
G in connection with the offering of the Securities, made by the Company or by
the Company's Subsidiaries, as the case may be, to Bankers Trust Company, as
Collateral Agent, as the same may be amended, supplemented or otherwise modified
from time to time in accordance with the provisions thereof.
"OFFERING CIRCULAR" means the Offering Circular dated April 8, 1998
relating to the Initial Securities; provided that after the issuance of Exchange
Securities, all references herein to "Offering Circular" shall be deemed
references to the prospectus contained in the registration statement relating to
the Exchange Securities.
"OFFICER" means the Chairman of the Board, the President, any Vice
President, the Treasurer or the Secretary of the Company, and Guarantor as
applicable.
"OFFICERS' CERTIFICATE" means a certificate signed by any two Officers of
the Company.
"OPINION OF COUNSEL" means an executed written opinion complying with
Section 12.5 herein from Robert J. Tubbs, Esq. or any other legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"PERMITTED LIENS" means (i) Liens on any asset of the Company or any
Subsidiary created solely to secure obligations incurred to finance the
refurbishment, improvement or construction of such asset, which obligations are
incurred no later than 180 days after completion of such refurbishment,
improvement or construction, and all renewals, extensions, refinancings,
replacements or refundings of such obligations, or to secure all or part of the
cost of such refurbishment, improvement or construction; (ii) (a) Liens to
secure the payment of the purchase price incurred in connection with the
acquisition (including acquisition through merger or consolidation) of any
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asset (including shares of stock), including Capital Lease transactions in
connection with any such acquisition and (b) Liens existing on any asset at the
time of acquisition thereof or at the time of acquisition by the Company or any
Subsidiary of any Person then owning such asset, directly or indirectly, whether
or not such existing Liens were given to secure the payment of the purchase
price of the property to which they attach; provided that, with respect to
clause (a), such Liens shall be given within one year after such acquisition and
shall attach solely to the assets acquired or purchased and any improvements
then or thereafter placed thereon; (iii) 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; (iv) Liens upon specific items of
inventory or other goods and proceeds of any Person securing such Person's
obligations in respect of bankers' acceptances issued or created for the account
of such Person to facilitate the purchase, shipment or storage of such inventory
or other goods; (v) Liens securing reimbursement obligations with respect to
letters of credit that encumber documents and other property relating to such
letters of credit and the products and proceeds thereof; (vi) Liens encumbering
customary initial deposits and margin deposits and other Liens, in each case
securing Indebtedness of the Company or any Subsidiary under interest rate and
currency hedging instruments and forward contract, option, futures contracts,
futures options or similar agreements or arrangements designed to protect the
Company or any Subsidiary from fluctuations in interest rates, currencies or the
price of commodities; (vii) Liens arising out of conditional sale, title
retention, consignment or similar arrangements for the sale of goods entered
into by the Company or any Subsidiary in the ordinary course of business; (viii)
Liens in favor of the Company or any Subsidiary; (ix) Liens for taxes,
assessments or governmental charges or levies on the assets of the Company or
any Subsidiary if the same shall not at the time be delinquent or thereafter can
be paid without penalty, or are being contested in good faith and by appropriate
proceedings or Liens for the excess of the amount of any past due taxes for
which a final assessment has not been received over the amount of such taxes as
estimated and paid; (x) Liens imposed by law, such as carriers', warehousemen's
and mechanics' Liens and other similar Liens on the assets of the Company or any
Subsidiary arising in the ordinary course of business which secure payment of
obligations not more than 60 days past due or are being contested in good faith
and by appropriate proceedings; (xi) Liens on the assets of the Company or any
Subsidiary incurred in the ordinary course of business to secure performance of
obligations with respect to statutory or regulatory requirements, performance or
return-of-money bonds, surety bonds or other obligations of a like nature and
incurred in a manner consistent with industry practice; (xii) Liens on the
assets of a Receivables Subsidiary in a Qualified Receivables Transaction;
(xiii) Liens in respect of any judgment (other than any judgment which
constitutes an Event of Default or which, after the passage of time may
constitute an Event of Default) rendered which is being contested diligently and
in good faith by appropriate proceedings by the Company or any of its
Subsidiaries and which does not have a material adverse effect on the ability of
the Company and its Subsidiaries to operate the business or operations of the
Company or its Subsidiaries taken as a whole; and (xiv) Liens in favor of the
United States or any state or territory or possession thereof, or any foreign
country, or any department, agency, instrumentality or political subdivision of
any of such domestic or foreign governmental entity, to secure partial,
progress, advance or other payments pursuant to any contract or statute or to
secure any liability incurred for the purpose of financing all or part of the
purchase price or the cost of constructing the asset subject to such Liens;
"PERSON" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"PRINCIPAL" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to become
due at the relevant time; provided, however, that for purposes of calculating
any such premium, the term "principal" shall not include the premium with
respect to which such calculation is being made.
"QUALIFIED RECEIVABLES TRANSACTION" means any transaction or series of
transactions that may be entered into by the Company or any of its Subsidiaries
pursuant to which the Company or any of its Subsidiaries may sell, convey or
otherwise transfer to (i) a Receivables Subsidiary (in the case of a transfer by
the Company or a Subsidiary) and (ii) any other Person (in the case of a
transfer by a Receivables Subsidiary), or may grant a security interest in, any
accounts receivable (whether now existing or arising in the future) of the
Company or any of its Subsidiaries, and any assets related thereto including all
collateral securing such accounts receivable, all
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contracts and all guarantees or other obligations in respect of such accounts
receivable, proceeds of such accounts receivable and other assets which, in each
case, are customarily and regularly transferred, or in respect of which security
interests are customarily granted, in connection with asset securitization
transactions involving accounts receivable.
"RECEIVABLES SUBSIDIARY" means a Subsidiary of the Company which engages in
no activities other than in connection with the financing of accounts receivable
and which is designated by or pursuant to the authority of the Board of
Directors as a Receivables Subsidiary (a) no portion of the Indebtedness of
which (i) is Guaranteed by the Company or any Subsidiary, (ii) is recourse to or
obligates the Company or any Subsidiary in any manner other than pursuant to
customary representations, warranties, covenants and indemnities entered into in
connection with a Qualified Receivables Transaction or (iii) subjects any assets
of the Company or any Subsidiary, directly or indirectly, contingently or
otherwise, to the satisfaction thereof, other than pursuant to the
representations, warranties, covenants and indemnities entered into in the
ordinary course of business in connection with a Qualified Receivables
Transaction and other than in respect of the related pledge of the financed
accounts receivable and (b) with which neither the Company nor any Subsidiary
has any obligation to maintain or preserve such Subsidiary's financial condition
or cause such Subsidiary to achieve certain levels of operating results.
"SEC" means the U.S. Securities and Exchange Commission, or any successor
agency.
"SECURITIES" means the Initial Securities, the Exchange Securities and the
Private Exchange Securities issued or to be issued under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a "Significant
Subsidiary" of the Company within the meaning of Rule 1-02 under Regulation S-X
promulgated by the SEC.
"STATED MATURITY" means, with respect to any Security, the date specified
in such Security as the fixed date on which the payment of Principal of such
Security is due and payable, including pursuant to any mandatory redemption
provision.
"SUBSIDIARIES PLEDGE AGREEMENT" means the pledge agreement, dated as of
March 24, 1992, as amended and restated as of December 18, 1996, and as further
amended and restated as of March 16, 1998 in connection with the offering of the
Securities, made by the Company's Subsidiaries to Bankers Trust Company, as
Collateral Agent, substantially in the form of Exhibit D, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
the provisions thereof.
"SUBSIDIARIES SECURITY AGREEMENT" means the security agreement, dated as of
March 24, 1992, as amended and restated as of January 11, 1994, as further
amended and restated as of December 18, 1996, and as further amended and
restated as of March 16, 1998 in connection with the offering of the Securities,
made by the Company's Subsidiaries to Bankers Trust Company, as Collateral
Agent, substantially in the form of Exhibit F, as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
provisions thereof.
"SUBSIDIARY" means a Person (other than an individual), a majority of the
outstanding voting stock, partnership interests, membership interests or other
equity interest, as the case may be, of which is owned or controlled, directly
or indirectly, by the Company or by one or more other Subsidiaries of the
Company. For the purposes of this definition, "voting stock" means stock having
voting power for the election of directors, trustees or managers, as the case
may be, whether at all times or only so long as no senior class of stock has
such voting power by reason of any contingency.
"SUBSIDIARY GUARANTEE" means the Guarantee by a Subsidiary Guarantor of the
Company's obligations with respect to the Securities.
"SUBSIDIARY GUARANTOR" means each Subsidiary of the Company existing on the
Issue Date and each new Subsidiary created after the Issue Date (in each case,
other than Foreign Subsidiaries), in each case that Guarantees the Company's
obligations under the Credit Agreement; provided that, if such Subsidiary's
Guarantee
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of the Company's obligations under the Credit Agreement is released or ceases to
be in effect, such Subsidiary shall no longer be a Subsidiary Guarantor.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. sec.sec.
77aaa-77bbbb) as in effect on the date of this Indenture; provided, however,
that, in the event the Trust Indenture Act of 1939 is amended after such date,
"TIA" means, to the extent required by any such amendments, the Trust Indenture
Act of 1939 as so amended.
"TRUSTEE" means the party named as such in this Indenture until a successor
replaces it and, thereafter, means such successor.
"TRUST OFFICER" means any officer within the Corporate Trust Office
including any Vice President, Managing Director, Assistant Vice President,
Secretary, Assistant Secretary Treasurer or Assistant Treasurer or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge and familiarity with the particular subject.
"UNIFORM COMMERCIAL CODE" means the New York Uniform Commercial Code as in
effect from time to time.
"U.S. GOVERNMENT OBLIGATIONS" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable or redeemable at the issuer's option.
SECTION 1.2. OTHER DEFINITIONS.
DEFINED IN
TERM SECTION
---- ----------
"Appendix".................................................. 2.1
"Authenticating Agent"...................................... 2.2
"Bankruptcy Law"............................................ 6.1
"covenant defeasance option"................................ 8.1(b)
"Custodian"................................................. 6.1
"Event of Default".......................................... 6.1
"Obligations"............................................... 10.1
"legal defeasance option"................................... 8.1(b)
"Paying Agent".............................................. 2.3
"Registrar"................................................. 2.3
"Successor Company"......................................... 5.1
SECTION 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
This Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company, the Guarantor and
any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by the TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
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SECTION 1.4. 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 GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the plural
include the singular;
(6) unsecured Indebtedness shall not be deemed to be subordinate or
junior to secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(7) the principal amount of any noninterest bearing or other discount
security at any date shall be the principal amount thereof that would be
shown on a balance sheet of the issuer dated such date prepared in
accordance with GAAP;
(8) the principal amount of any preferred stock shall be (i) the
maximum liquidation preference of such preferred stock or (ii) the maximum
mandatory redemption or mandatory repurchase price with respect to such
preferred stock, whichever is greater; and
(9) all references to the date the Securities were originally issued
shall refer to the date the Initial Securities were originally issued.
SECTION 1.5. ONE CLASS OF SECURITIES.
The Initial Securities, the Private Exchange Securities and the Exchange
Securities shall vote and consent together on all matters as one class and none
of the Initial Securities, the Private Exchange Securities or the Exchange
Securities shall have the right to vote or consent as a separate class on any
matter.
ARTICLE II
THE SECURITIES
SECTION 2.1. FORM AND DATING.
Certain provisions relating to the Initial Securities, the Private Exchange
Securities and the Exchange Securities are set forth in the Rule 144A/Regulation
S Appendix attached hereto (the "Appendix"), which is hereby incorporated in and
expressly made a part of this Indenture. The Initial Securities and the
Trustee's certificate of authentication shall be substantially in the form of
Exhibit 1 to the Appendix, which is hereby incorporated in and expressly made a
part of this Indenture. The Exchange Securities, the Private Exchange Securities
and the Trustee's certificate of authentication shall be substantially in the
form of Exhibit A, which is hereby incorporated by reference and expressly made
a part of this Indenture. The Securities may have notations, legends or
endorsements required by law, rule of any securities exchange or
over-the-counter market on which such Securities are then listed or quoted, or
usage, in addition to those set forth on the Appendix and Exhibit A. The Company
and the Trustee shall approve the forms of the Securities and any notation,
endorsement or legend on them. Each Security shall be dated the date of its
authentication. The terms of the Securities set forth in the Appendix and
Exhibit A are part of the terms of this Indenture and, to the extent applicable,
the Company, the Subsidiary Guarantors and the Trustee, by their execution and
delivery of this Indenture, expressly agree to be bound by such terms.
SECTION 2.2. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Securities for the Company by manual or
facsimile signature and may be imprinted or otherwise reproduced.
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If an Officer whose signature is on a Security no longer holds that office
at the time the Trustee authenticates the Security, the Security shall be valid
nevertheless.
A Security shall not be valid until an authorized signatory of the Trustee
manually authenticates the Security. The signature of the Trustee on a Security
shall be conclusive evidence that such Security has been duly and validly
authenticated and issued under this Indenture.
The Trustee may appoint an agent (the "Authenticating Agent") reasonably
acceptable to the Company to authenticate the Securities. Unless limited by the
terms of such appointment, any such Authenticating Agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. The Trustee
shall authenticate Securities for original issue up to the aggregate principal
amount stated in Section 2.2 of the Appendix to this Indenture upon a written
order of the Company signed by two Officers. The aggregate principal amount of
Securities outstanding at any time may not exceed that amount except as provided
in Section 2.7.
SECTION 2.3. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (the "Registrar") and an
office or agency where Securities may be presented for payment (the "Paying
Agent"). The Registrar shall keep a register of the Securities and of their
transfer and exchange. The Company may have one or more co-registrars and one or
more additional paying agents. The term "Paying Agent" includes any such
additional paying agent.
In the event the Company shall retain any Person not a party to this
Indenture as an agent hereunder, the Company shall enter into an appropriate
agency agreement with any Registrar, Paying Agent or co-registrar not a party to
this Indenture, which shall incorporate the terms 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 each such agent. If
the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act
as such and shall be entitled to appropriate compensation therefor pursuant to
Section 7.7. The Company or any of its domestically incorporated wholly owned
Subsidiaries may act as Paying Agent.
The Company initially appoints the Trustee as Registrar and Paying Agent
for the Securities.
SECTION 2.4. PAYING AGENT TO HOLD MONEY IN TRUST.
By at least 11:00 a.m. (New York City time) on the date on which any
Principal or interest (including any Additional Interest) on any Security is due
and payable, the Company shall deposit with the Paying Agent a sum sufficient to
pay such Principal or interest (including any Additional Interest) when due. The
Company shall require each Paying Agent (other than the Trustee) to agree in
writing that such Paying Agent shall hold in trust for the benefit of
Securityholders or the Trustee all money held by such Paying Agent for the
payment of Principal of or interest (including any Additional Interest) on the
Securities and shall promptly notify the Trustee in writing of any default by
the Company in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate the money held by it as Paying Agent and hold
it as a separate trust fund. The Company at any time may require a Paying Agent
(other than the Trustee) to pay all money held by it to the Trustee and to
account for any funds disbursed by such Paying Agent. Upon complying with this
Section, the Paying Agent (if other than the Company or a Subsidiary) shall have
no further liability for the money delivered to the Trustee. Upon any
bankruptcy, reorganization or similar proceeding with respect to the Company,
the Trustee shall serve as Paying Agent for the Securities.
SECTION 2.5. SECURITYHOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall cause
the Registrar to furnish to the Trustee, in writing at least five Business Days
before each interest payment date and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Securityholders.
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SECTION 2.6. [INTENTIONALLY OMITTED]
SECTION 2.7. REPLACEMENT SECURITIES.
If a mutilated Security is surrendered to the Registrar or if the Holder of
a Security shall provide the Company and the Trustee with evidence to their
satisfaction that the Security has been lost, destroyed or wrongfully taken, the
Company shall issue and the Trustee shall authenticate a replacement Security if
the requirements of the Trustee and the Company are met. If required by the
Trustee or the Company, such Holder shall furnish an indemnity bond sufficient
in the judgment of the Company and the Trustee to protect the Company, the
Trustee, the Paying Agent, the Registrar and any co-registrar or other agent
from any loss which any of them may suffer if a Security is replaced. The
Company and the Trustee may charge the Holder for their expenses in replacing a
Security, including reasonable fees and expenses of counsel. Every replacement
Security is an additional obligation of the Company.
SECTION 2.8. OUTSTANDING SECURITIES.
Securities outstanding at any time are all Securities authenticated by the
Trustee except for those canceled, those delivered for cancellation and those
described in this Section 2.8 as not outstanding. A Security does not cease to
be outstanding because the Company or an affiliate of the Company holds the
Security.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance with this
Indenture, on a redemption date or maturity date money sufficient to pay all
Principal and interest payable on that date with respect to the Securities (or
portions thereof) to be redeemed or maturing, as the case may be, and the Paying
Agent is not prohibited from paying such money to the Securityholders on that
date pursuant to the terms of this Indenture, then on and after that date such
Securities (or portions thereof) cease to be outstanding and interest on them
ceases to accrue.
SECTION 2.9. TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may execute
and the Trustee shall authenticate temporary Securities. Temporary Securities
shall be substantially in the form of definitive Securities but may have
variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities. After the preparation of definitive
Securities, the temporary Securities shall be exchangeable for definitive
Securities upon surrender of the temporary Securities at any office or agency
maintained by the Company for that purpose and such exchange shall be without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute, and the Trustee shall
authenticate and deliver in exchange therefor, one or more definitive Securities
representing an equal principal amount of Securities. Until so exchanged, the
Holder of temporary Securities shall in all respects be entitled to the same
benefits under this Indenture as a Holder of definitive Securities.
SECTION 2.10. 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
for cancellation any Securities surrendered to them for registration of transfer
or exchange or payment. The Trustee and no one else shall cancel and destroy all
Securities surrendered for registration of transfer or exchange, payment or
cancellation in accordance with its customary practices and procedures in effect
from time to time. The Company may not issue new Securities to replace
Securities it has redeemed, paid or delivered to the Trustee for cancellation.
SECTION 2.11. DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Securities, the
Company shall pay defaulted interest (plus interest on such defaulted interest
to the extent lawful) at the rate specified therefor in the Securities in any
lawful manner. The Company may pay the defaulted interest to the Persons who are
Securityholders on a
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subsequent special record date. The Company shall fix or cause to be fixed (or
upon the Company's failure to do so the Trustee shall fix) any such special
record date and payment date to the reasonable satisfaction of the Trustee which
specified record date shall not be less than 10 days prior to the payment date
for such defaulted interest and shall promptly mail or cause to be mailed to
each Securityholder a notice that states the special record date, the payment
date and the amount of defaulted interest to be paid. The Company shall notify
the Trustee in writing of the amount of defaulted interest proposed to be paid
on each Security and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such defaulted interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when so deposited to be held in trust for the
benefit of the Person entitled to such defaulted interest as provided in this
Section 2.11.
SECTION 2.12. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use) and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders, provided, however, that any such
notice may state that no representation is made as to the correctness of such
numbers either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers.
ARTICLE III
REDEMPTION
SECTION 3.1. NOTICES TO TRUSTEE.
If the Company elects to redeem Securities pursuant to paragraph 5 of the
Securities, it shall notify the Trustee in writing of the redemption date and
the principal amount of Securities to be redeemed.
The Company shall give each notice to the Trustee provided for in this
Section at least 30 days before the redemption date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate from the Company to the effect that such redemption will comply with
the conditions herein.
SECTION 3.2. SELECTION OF SECURITIES TO BE REDEEMED.
If fewer than all the Securities then outstanding are to be redeemed, the
Trustee shall select the Securities to be redeemed by a method that the Trustee
in its sole discretion considers to be fair and appropriate. The Trustee shall
make the selection from outstanding Securities not previously called for
redemption. The Trustee may select for redemption portions of the principal of
Securities that have denominations larger than $1,000. Securities and portions
of them the Trustee selects shall be in amounts of $1,000 or a whole multiple of
$1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption. Upon
request of the Company, the Trustee shall notify the Company of the Securities
or portions of Securities to be redeemed.
SECTION 3.3. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a date for redemption of
Securities, the Trustee at the expense of the Company shall mail a notice of
redemption by first-class mail to each Holder of Securities to be redeemed.
The notice shall identify the Securities to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price if such price is calculable at the time such
notice is sent or, if not, the formula for calculating such price;
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(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price plus accrued and unpaid
interest, if any;
(5) if fewer than all the outstanding Securities are to be redeemed,
the identification and principal amounts of the particular Securities to be
redeemed;
(6) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment pursuant
to the terms of this Indenture, interest on Securities (or portion thereof)
called for redemption ceases to accrue on and after the redemption date;
(7) the CUSIP number, if any, printed on the Securities being
redeemed; and
(8) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Securities.
The Trustee shall give the notice of redemption in the Company's name and
at the Company's expense. In such event, the Company shall compute and provide
the Trustee with the information required by this Section 3.3.
SECTION 3.4. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed, Securities called for redemption shall
become due and payable on the redemption date and at the redemption price stated
or calculable as set forth in the notice. Upon surrender to the Paying Agent,
such Securities shall be paid at the redemption price stated in the notice, plus
accrued and unpaid interest, if any, to the redemption date; provided that the
Company shall have deposited the redemption price and accrued interest, if any,
with the Paying Agent or the Trustee on or before 11:00 a.m. (New York City
time) on the date of redemption; provided, further, that if the redemption date
is on an interest payment date, any accrued and unpaid interest shall be payable
to the Securityholder of the redeemed Securities registered on the relevant
record date. Failure to give notice or any defect in the notice to any Holder
shall not affect the validity of the notice to any other Holder.
SECTION 3.5. DEPOSIT OF REDEMPTION PRICE.
By at least 11:00 a.m. (New York City time) on the date on which any
Principal of or interest on any Security is due and payable, the Company shall
deposit with the Paying Agent (or, if the Company or a Subsidiary is the Paying
Agent, shall segregate and hold in trust) money sufficient to pay the redemption
price of and accrued and unpaid interest on all Securities to be redeemed on
that date other than Securities or portions of Securities called for redemption
which are owned by the Company or an affiliate and have been delivered by the
Company or such Subsidiary to the Trustee for cancellation.
If the Company complies with the preceding paragraph, then, unless the
Company defaults in the payment of such redemption price, interest on the
Securities to be redeemed will cease to accrue on and after the applicable
redemption date, whether or not such Securities are presented for payment.
SECTION 3.6. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is redeemed in part, the Company shall
execute and the Trustee shall authenticate for the Holder (at the Company's
expense) a new Security equal in a principal amount to the unredeemed portion of
the Security surrendered.
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ARTICLE IV
COVENANTS
SECTION 4.1. PAYMENT OF SECURITIES.
The Company shall promptly pay the Principal of and interest (including
Additional Interest) on the Securities on the dates and in the manner provided
in the Securities and in this Indenture. Principal and interest (including
Additional Interest) shall be considered paid on the date due if on or before
11:00 a.m. (New York City time) on such date the Trustee or the Paying Agent
(or, if the Company or a Subsidiary is the Paying Agent, the segregated account
or separate trust fund maintained by the Company or such Subsidiary pursuant to
Section 2.4) holds in accordance with this Indenture money sufficient to pay all
Principal and interest (including Additional Interest) then due and the Trustee
or the Paying Agent (or, if the Company or a Subsidiary is the Paying Agent, the
Company or such Subsidiary), as the case may be, is not prohibited from paying
such money to the Securityholders on that date pursuant to the terms of this
Indenture.
The Company shall pay interest on overdue principal at the rate specified
therefor in the Securities, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful as provided in Section 2.11.
Notwithstanding anything to the contrary contained in this Indenture, the
Company or the Paying Agent may, to the extent it is required to do so by law,
deduct or withhold income or other similar taxes imposed by the United States of
America or other domestic or foreign taxing authorities from Principal or
interest payments hereunder.
SECTION 4.2. LIMITATIONS ON LIENS.
(a) Neither the Company nor any Subsidiary Guarantor will, nor will they
permit any of their Subsidiaries (excluding Foreign Subsidiaries) to create,
incur, or permit to exist, any Lien on any of their respective assets, whether
now owned or hereafter acquired, in order to secure any Indebtedness of either
of the Company or any Subsidiary Guarantor, without effectively providing that
the Securities shall be equally and ratably secured until such time as such
Indebtedness is no longer secured by such Lien, except: (i) Liens securing
Indebtedness arising under the Credit Agreement so long as such Liens also
secure the Securities, equally and ratably; (ii) Liens on cash and cash
equivalents securing obligations in respect of letters of credit in accordance
with the terms of the Credit Agreement; (iii) Liens existing as of the Issue
Date; (iv) Liens existing on the Issue Date or granted after the Issue Date on
any assets of the Company or any Subsidiary Guarantor or any of their
Subsidiaries securing Indebtedness of the Company or any Subsidiary created in
favor of the Holders of the Securities; (v) Liens securing Indebtedness of the
Company or any Subsidiary Guarantor which is incurred to extend, renew or
refinance Indebtedness which is secured by Liens permitted to be incurred under
this Indenture; provided that such Liens do not extend to or cover any assets of
the Company or any Subsidiary other than the assets securing the Indebtedness
being extended, renewed or refinanced and that the principal amount of such
Indebtedness does not exceed the principal amount of the Indebtedness being
extended, renewed or refinanced at the time of such extension, renewal or
replacement, or at the time the Lien was issued, created or assumed or otherwise
permitted; (vi) Permitted Liens; and (vii) Liens created in substitution of or
as replacements for any Liens permitted by the preceding clauses (i) through
(vi) or this clause (vii), provided that, based on a good faith determination of
an officer of the Company, the asset encumbered under any such substitute or
replacement Lien is substantially similar in nature to the asset encumbered by
the otherwise permitted Lien which is being replaced.
(b) Notwithstanding the foregoing and Section 4.3, the Company and any
Subsidiary may, without securing any of the Securities, create, incur or permit
to exist Liens which would otherwise be subject to the restrictions set forth in
the preceding paragraph, if after giving effect thereto and at the time of
determination, the aggregate amount of Exempted Debt does not exceed the greater
of (x) $100 million and (y) 15% of Consolidated Net Assets.
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SECTION 4.3. LIMITATION ON SALE AND LEASE-BACK TRANSACTIONS.
Neither the Company nor any Subsidiary Guarantor will, nor will they permit
any of their Subsidiaries (excluding Foreign Subsidiaries) to, enter into any
sale and lease-back transaction for the sale and leasing back of any property or
asset, whether now owned or hereafter acquired, of the Company or any Subsidiary
(except such transactions (i) entered into prior to the Issue Date, (ii) for the
sale and leasing back of any property or asset by a Subsidiary to the Company or
to another Subsidiary Guarantor (or, if there are no Subsidiary Guarantors,
another Subsidiary), (iii) involving leases for less than three years or (iv) in
which the lease for the property or asset is entered into within 180 days after
the later of the date of acquisition, completion of construction or commencement
or full operations of such property or asset) unless (a) the Company or any such
Subsidiary would be entitled under Section 4.2(a) to create, incur or permit to
exist a Lien on the assets to be leased securing Indebtedness in an amount at
least equal to the Attributable Debt in respect of such transaction without
equally and ratably securing the Securities, (b) the Company or any Subsidiary
would be entitled under Section 4.2(b) to create, incur or permit to exist a
Lien on the assets to be leased securing Indebtedness in an amount at least
equal to the Attributable Debt in respect of such transaction without equally
and ratably securing the Securities or (c) the proceeds of the sale of the
assets to be leased are at least equal to their fair market value and the
proceeds are applied to the purchase or acquisition (or in the case of real
property, the construction) of assets or to the repayment of Indebtedness of the
Company or any Subsidiary Guarantor (or, if there are no Subsidiary Guarantors,
another Subsidiary).
SECTION 4.4. COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee within 120 days after the end of
each fiscal year of the Company an Officers' Certificate stating that in the
course of the performance by the signers of their duties as Officers of the
Company whether or not the signers know of any Default or Event of Default that
occurred during such period. If they do, the certificate shall describe the
Default or Event of Default, its status and what action the Company is taking or
proposes to take with respect thereto. The Company and each of the Subsidiary
Guarantors also shall, to the extent required, comply with TIA sec. 314(a)(4).
SECTION 4.5. FURTHER INSTRUMENTS AND ACTS.
Upon reasonable request of the Trustee, the Company will execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this Indenture.
SECTION 4.6. MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain the office or agency required under Section 2.3.
The Company shall give prior 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 12.2.
SECTION 4.7. SEC REPORTS.
The Company and each Subsidiary Guarantor will comply, to the extent
required, with all the applicable provisions of TIA sec. 314(a) and, for so long
as the Company is not required to file reports under Sections 13 or 15(d) of the
Exchange Act, the Company will comply with the applicable provisions of Rule
144A(d)(4) under the Securities Act.
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ARTICLE V
SUCCESSOR COMPANY
SECTION 5.1. WHEN THE COMPANY MAY MERGE OR TRANSFER ASSETS.
The Company will not consolidate with or sell or lease its assets as, or
substantially as, an entirety, to, or merge with or into, in one transaction or
a series of transactions, any other Person, unless:
(i) the Company shall be the continuing entity, or the resulting,
surviving or transferee Person (the "Successor Company") shall be a Person
organized and existing under the laws of the United States of America, any
State thereof or the District of Columbia and the Successor Company (if not
the Company) shall expressly assume, by supplemental indenture, executed
and delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and this Indenture;
(ii) immediately after giving effect to such transaction, no Default
or Event of Default shall have occurred and be continuing; and
(iii) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any)
comply with this Indenture, as set forth in this Indenture.
Upon any consolidation or merger, or any sale or lease of the assets of the
Company as, or substantially as, an entirety in accordance with this Section
5.1, the entity formed by such consolidation or into which the Company shall
have been merged or to which such sale or lease shall have been made shall
succeed to and be substituted for the Company with the same effect as if it had
been named in this Indenture as a party hereto and thereafter from time to time
such successor entity may exercise each and every right and power of the Company
under this Indenture in the name of the Company or in its own name; and any act
or proceeding by any provision of this Indenture required or permitted to be
done by the Board of Directors or any Officer of the Company may be done with
like force and effect by the like board or officer of any entity that shall at
the time be the successor of the Company hereunder. In the event of the sale by
the Company of its assets as, or substantially as, an entirety upon the terms
and conditions of this Section 5.1, the Company shall be released from all its
liabilities and obligations under this Indenture and the Securities, but the
predecessor Company in the case of a lease of all its assets or substantially
all its assets will not be released from the obligation to pay the Principal of
and interest on the Securities.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.1. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(1) the Company defaults in any payment of interest on any Security
when the same becomes due and payable, and such default continues for a
period of 30 days;
(2) the Company defaults in the payment of the Principal of any
Security when the same becomes due and payable at its Stated Maturity, upon
declaration or otherwise;
(3) the Company fails to comply with Article V;
(4) a Subsidiary Guarantor or the Company fails to comply with Section
4.2 or 4.3 and such failure continues for 60 days after the notice
specified below;
(5) the Company or a Subsidiary Guarantor fails to comply with any of
its agreements in the Securities or this Indenture (other than those
referred to in (1), (2), (3) or (4) above) and such failure continues for
60 days after the notice specified below;
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(6) the Company or the Subsidiary Guarantors or any Subsidiary of the
Company fails to pay any interest or Principal on any Indebtedness within
any applicable grace period provided in such Indebtedness after final
maturity or the acceleration of any such Indebtedness by the holders
thereof because of a default and the total amount of such Indebtedness
unpaid or accelerated exceeds $30 million or its foreign currency
equivalent;
(7) the Company or a Significant Subsidiary of the Company pursuant to
or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in an
involuntary case in which it is the debtor;
(C) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(D) makes a general assignment for the benefit of its creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(8) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Significant Subsidiary
of the Company in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any assets that constitute a substantial part of the
assets of the Company or that constitute all or substantially all of the
assets of a Significant Subsidiary; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary of the Company;
(or any similar relief is granted under any foreign laws) and the order,
decree or relief remains unstayed and in effect for 60 days;
(9) any judgment or decree by a court of competent jurisdiction for
the payment of money in excess of $30 million or its foreign currency
equivalent at the time is rendered against the Company or any Significant
Subsidiary of the Company and such judgment or decree remains unpaid and
outstanding for a period of 60 days following such judgment and is not
discharged, waived or stayed within 30 days after notice;
(10) except as permitted under this Indenture, a Subsidiary Guarantee
ceases to be in full force and effect for 30 days after notice or a
Subsidiary Guarantor denies or disaffirms its obligations under its
Subsidiary Guarantee; or
(11) except as permitted by the Collateral Documents, the Credit
Agreement and this Indenture or any amendments hereto or thereto, any of
the Collateral Documents ceases to be in full force and effect or ceases to
be effective, in all material respects, to create a Lien on the Collateral
in favor of the Senior Noteholders for 30 days after notice.
The foregoing will constitute Events of Default whatever the reason for any
such Event of Default and whether it is voluntary or involuntary or is effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body.
The term "Bankruptcy Law" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
A Default under clause (4), (5), (9), (10) and (11) of this Section 6.1 is
not an Event of Default until the Trustee or the Holders of at least 25% in
aggregate principal amount of the outstanding Securities gives notice to the
Company of the Default and the Company does not cure such Default within the
time specified in said
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clause (4), (5), (9), (10) and (11) after receipt of such notice. Such notice
must specify the Default, demand that it be remedied and state that such notice
is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (6) of this Section 6.1 and any event which
with the giving of notice or the lapse of time would become an Event of Default
under clause (4), (5), (9), (10) and (11) of this Section 6.1 and what action
the Company is taking or proposes to take with respect thereto.
SECTION 6.2. ACCELERATION.
If an Event of Default (other than an Event of Default specified in Section
6.1(7) or (8) with respect to the Company) occurs and is continuing, the Trustee
by notice to the Company, or the Holders of at least 25% in aggregate principal
amount of the outstanding Securities by notice to the Company and the Trustee,
may declare the Principal of and accrued but unpaid interest on all the
Securities to be due and payable. Upon such a declaration, such Principal and
interest shall be due and payable immediately. If an Event of Default specified
in Section 6.1(7) or (8) with respect to the Company or a Significant Subsidiary
occurs and is continuing, the Principal of and accrued interest on all the
Securities shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holders. The
Holders of a majority in aggregate principal amount of the outstanding
Securities by notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of Principal or interest that has become due solely because of
acceleration and the Trustee has been paid all amounts due to it pursuant to
Section 7.7. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.3. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of Principal of or interest on the
Securities or to enforce the performance of any provision of the Securities or
this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are, to the extent
permitted by law, cumulative.
SECTION 6.4. WAIVER OF PAST DEFAULTS.
The Holders of a majority in aggregate principal amount of the Securities
then outstanding by notice to the Trustee may waive any past or existing Default
and its consequences except (i) a Default in the payment of the Principal of or
interest on a Security or (ii) a Default in respect of a provision that under
Section 9.2 cannot be amended without the consent of each Securityholder
affected. When a Default is waived, it is deemed cured, and any Event of Default
arising therefrom shall be deemed to have been cured, but no such waiver shall
extend to any subsequent or other Default or impair any consequent right.
SECTION 6.5. CONTROL BY MAJORITY.
Upon provision of reasonable indemnity to the Trustee satisfactory to the
Trustee, the Holders of a majority in aggregate principal amount of the
Securities then outstanding may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or of exercising any
trust or power conferred on the Trustee. However, the Trustee, which shall be
entitled to receive and may conclusively rely on Opinions of Counsel, may refuse
to follow any direction that conflicts with law or this Indenture or, subject to
Section 7.1, that the Trustee determines is unduly prejudicial to the rights of
other Securityholders or would involve the Trustee in personal liability;
provided, however, that the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction.
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SECTION 6.6. LIMITATION ON SUITS.
A Holder may not pursue any remedy with respect to this Indenture or the
Securities unless:
(i) the Holder gives to the Trustee previous written notice stating
that an Event of Default is continuing;
(ii) the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding make a written request to the Trustee to pursue
the remedy;
(iii) such Holder or Holders offer to the Trustee security or
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 of security or indemnity; and
(v) the Holders of a majority in aggregate principal amount of the
Securities then outstanding do not give the Trustee a direction
inconsistent with the written request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
SECTION 6.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of Principal of and interest on the Securities held by
such Holder, on or after the respective due dates expressed in the Securities,
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 such
Holder.
SECTION 6.8. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.1(1) or (2) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company for the whole amount then due and owing
(together with interest on any unpaid interest to the extent lawful) and the
amounts provided for in Section 7.7.
SECTION 6.9. 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 and the
Securityholders allowed in any judicial proceedings relative to the Company, its
creditors or its property and, unless prohibited by law or applicable
regulations, may vote on behalf of the Holders in any election of a trustee in
bankruptcy or other Person performing similar functions, and any Custodian in
any such judicial proceeding is hereby authorized by each Holder to make
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, and any other amounts due
the Trustee under Section 7.7.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money or property pursuant to this Article VI,
it shall pay out the money or property in the following order:
FIRST: to the Trustee for amounts due under Section 7.7;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for Principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for Principal and interest, respectively; and
THIRD: to the Company.
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The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section 6.10. At least 15 days before such
record date, the Trustee shall mail to each Securityholder and the Company a
notice that states the record date, the payment date and amount to be paid.
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 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.7 or a suit by Holders of more than 10% in aggregate
principal amount of the outstanding Securities.
SECTION 6.12. WAIVER OF STAY OR EXTENSION LAWS.
The Company (to the extent it may lawfully do so) shall not at any time
insist upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and 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.
ARTICLE VII
TRUSTEE
SECTION 7.1. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this Indenture and use the
same degree of care and skill in their exercise as a prudent Person would
exercise or use under the circumstances in the conduct of such Person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall examine the certificates and opinions to determine whether or
not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own wilful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section 7.1;
(ii) 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
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.5.
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(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law. The Trustee shall not be liable for
interest on any money received by it except as the Trustee may agree with the
Company.
(f) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur financial liability in the performance of
any of its duties hereunder or in the exercise of any of its rights or powers,
if it shall have reasonable grounds to believe that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
(g) Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Trustee shall be subject to the
provisions of this Section 7.1 and to the provisions of the TIA.
(h) The Trustee shall not be bound to make any investigation into facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture 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 books, records and premises of the Company,
personally or by agent or attorney.
(i) Any request or direction of the Company mentioned in the Indenture
shall be sufficiently evidenced by a written request or order of the Company and
any resolution of the Board of Directors may be sufficiently evidenced by a copy
of the resolution certified by the Secretary or Assistant Secretary of the
Company to have been duly adopted by the Board of Directors and to be in full
force and effect on the date of such certification.
(j) The Trustee shall not be responsible for the recording, rerecording,
filing of UCC Statements or UCC Continuation Statements.
(k) The permissive right of the Trustee to do things enumerated in this
Indenture shall not be construed as a duty, and the Trustee shall not be
answerable for other than its gross negligence or willful misconduct.
SECTION 7.2. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively 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 shall be entitled
to and may require an Officers' Certificate or an Opinion of Counsel. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents, attorneys, custodians or nominees
and shall not be responsible for the misconduct or negligence or supervision of
any agent, attorney, custodian or nominee 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 believes to be authorized or within its rights or
powers.
(e) The Trustee may consult with counsel of its selection, and the advice
or opinion of counsel with respect to matters relating to this Indenture and the
Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it hereunder in
good faith and in accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee security or indemnity satisfactory to it against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction.
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(g) The Trustee shall not be charged with knowledge of any Default or Event
of Default with respect to the Securities unless either (1) a Trust Officer
shall have actual knowledge of such Default or Event of Default or (2) written
notice of such Default or Event of Default shall have been given to the Trustee
by the Company or any other obligor on the Securities or by any Holder of the
Securities.
(h) If the Trustee is acting as Paying Agent or Registrar hereunder, the
rights and protections of the Trustee under this Article VII shall also apply to
the Trustee as Paying Agent or Registrar.
SECTION 7.3. 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 respective
Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.4. 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 any Subsidiary
Guarantor in this Indenture or in any document issued in connection with the
sale of the Securities or in the Securities other than the Trustee's certificate
of authentication.
SECTION 7.5. NOTICE OF DEFAULTS.
If a Default or an Event of Default occurs and is continuing and if it is
actually known to a Trust Officer of the Trustee, the Trustee shall mail to each
Securityholder notice of the Default within 30 days after it is known to a Trust
Officer or written notice of it is received by the Trustee. Except in the case
of a Default in payment of Principal of or interest on any Security, 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 not opposed to the
interests of Securityholders.
SECTION 7.6. REPORTS BY TRUSTEE TO HOLDERS.
As promptly as practicable after each April 15 beginning with the April 15,
1999 following the date of this Indenture, and in any event prior to July 15 in
each year, the Trustee shall mail to each Securityholder a brief report dated as
of such April 15 that complies with TIA sec. 313(a). The Trustee also shall
comply with TIA sec. 313(b). The Trustee shall promptly deliver to the Company a
copy of any report it delivers to Holders pursuant to this Section 7.6.
A copy of each report at the time of its mailing to Securityholders shall
be filed by the Trustee with the SEC and each stock exchange (if any) on which
the Securities are listed. The Company agrees to notify promptly the Trustee
whenever the Securities become listed on any stock exchange and of any delisting
thereof.
SECTION 7.7. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time such compensation
for its services as the Company and the Trustee shall from time to time agree in
writing. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable out-of-pocket expenses, disbursements
and advances, incurred or made by it, including costs of collection, in addition
to such compensation for its services, except any such expense, disbursement or
advance as may arise from its negligence, wilful misconduct or bad faith, unless
the Trustee shall have complied with the applicable standard of care required by
the TIA. Such expenses shall include the reasonable compensation and reasonable
expenses, disbursements and advances of the Trustee's agents, counsel,
accountants and experts. The Trustee shall provide the Company reasonable notice
of any expenditure not in the ordinary course of business; provided that prior
approval by the Company of any such expenditure shall not be a requirement for
the making
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of such expenditure nor for reimbursement by the Company thereof. The Company
shall indemnify each of the Trustee and any predecessor Trustees and their
officers, directors, employees and agents against any and all loss, damage,
claim, liability or expense (including reasonable attorneys' fees and expenses)
including taxes (other than taxes applicable to the Trustee's compensation
hereunder) incurred by it in connection with the acceptance or administration of
this trust and the performance of its duties hereunder. The Trustee shall notify
the Company promptly of any claim for which it may seek indemnity. Failure by
the Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder. At the sole discretion of the Trustee, the Company shall
defend the claim and the Trustee may have separate counsel, and the Company will
pay the reasonable fees and expenses of such counsel. The Company need not
reimburse any expense or indemnify against any loss, liability or expense
incurred by the Trustee through the Trustee's own wilful misconduct, negligence
or bad faith, unless the Trustee shall have complied with the applicable
standard of care required by the TIA.
To secure the Company's payment obligations in this Section 7.7, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
Principal of and interest on particular Securities.
The Company's payment obligations pursuant to this Section 7.7 shall
survive the resignation or removal of the Trustee and discharge of this
Indenture. When the Trustee incurs expenses after the occurrence of a Default
specified in Section 6.1(7) or (8) with respect to the Company, the expenses are
intended to constitute expenses of administration under the Bankruptcy Law.
SECTION 7.8. REPLACEMENT OF TRUSTEE.
The Trustee may resign at any time with 30 days notice to the Company. The
Holders of a majority in principal amount of the Securities then outstanding,
may remove the Trustee with 30 days written notice to the Trustee and the
Company and may appoint a successor Trustee. The Company shall remove the
Trustee if:
(i) the Trustee fails to comply with Section 7.10;
(ii) the Trustee is adjudged bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of the Trustee
or its property; or
(iv) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders of a
majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, 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.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Securityholders. The
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.7.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section
7.8, the Company's obligations under Section 7.7 shall continue for the benefit
of the retiring Trustee.
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SECTION 7.9. SUCCESSOR TRUSTEE BY MERGER.
If the Trustee consolidates with, merges or converts into, or transfers all
or substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Trustee, provided
that such corporation shall be eligible under this Article VII and TIA Section
310(a).
In case at the time such successor or successors by merger, conversion or
consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
The Trustee shall at all times satisfy the requirements of TIA sec. 310(a).
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. The Trustee
shall comply with TIA sec. 310(b); provided, however, that there shall be
excluded from the operation of TIA sec. 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 sec. 310(b)(1) are met.
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with TIA sec. 311(a), excluding any creditor
relationship listed in TIA sec. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA sec. 311(a) to the extent indicated.
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.1. DISCHARGE OF LIABILITY ON SECURITIES; DEFEASANCE.
(a) Discharge. When (i) the Company delivers to the Trustee all
outstanding Securities (other than Securities replaced pursuant to Section 2.7)
for cancellation or (ii) all outstanding Securities have become due and payable,
whether at maturity or as a result of the mailing of a notice of redemption
pursuant to Article III hereof or the Securities will become due and payable at
their Stated Maturity within 91 days, or the Securities are to be called for
redemption within 91 days under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense,
of the Company, and, in each case of this clause (ii), the Company irrevocably
deposits or causes to be deposited with the Trustee funds sufficient to pay at
Stated Maturity or upon redemption all outstanding Securities, including
interest thereon to maturity or such redemption date (other than Securities
replaced pursuant to Section 2.7 or delivered to the Trustee for cancellation),
and if in either case the Company pays all other sums payable hereunder by the
Company, then this Indenture shall, subject to Section 8.1(c), cease to be of
further effect and all the Subsidiary Guarantees shall be discharged and
released and all rights of the Trustee or the Holders under any of the
Collateral Documents shall terminate. The Trustee shall acknowledge satisfaction
and discharge of this Indenture and the discharge and release of the Subsidiary
Guarantees and the termination of such rights under the Collateral Documents on
demand of the Company accompanied by an Officers' Certificate and an Opinion of
Counsel stating that all conditions precedent provided for herein relating to
satisfaction and discharge of this Indenture have been complied with.
(b) Defeasance. Subject to Sections 8.1(c) and 8.2, the Company at any
time may terminate (i) all of its obligations and the obligations of all
Subsidiary Guarantors under the Securities and this Indenture and, upon
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such termination, all the Subsidiary Guarantees shall be discharged and released
and all rights of the Trustee or the Holders under any of the Collateral
Documents shall terminate ("legal defeasance option") or (ii) its obligations
and the obligations of all Subsidiary Guarantors under Sections 4.2 and 4.3 and
the operation of Sections 6.1(4), 6.1(5), 6.1(6), 6.1(7) (but only with respect
to a Significant Subsidiary), 6.1(8) (but only with respect to a Significant
Subsidiary), 6.1(9), 6.1(10) and 6.1(11) and, upon such termination, all the
Subsidiary Guarantees shall be discharged and released and all rights of the
Trustee or the Holders under any of the Collateral Documents shall terminate
("covenant defeasance option"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Section 6.1(4), 6.1(5),
6.1(6), 6.1(7) (but only with respect to a Significant Subsidiary), 6.1(8) (but
only with respect to a Significant Subsidiary) 6.1(9), 6.1(10) or 6.1(11).
Upon satisfaction of the conditions set forth herein and upon request of
the Company, the Trustee shall acknowledge in writing the discharge of those
obligations of the Company and the Subsidiary Guarantors that are terminated.
(c) Notwithstanding clauses (a) and (b) above, the Company's obligations in
Sections 2.3, 2.4, 2.5, 2.7, 4.1, 4,6, 7.7, 7.8, 8.4, 8.5 and 8.6 shall survive
until the Securities have been paid in full. Thereafter, the Company's
obligations in Sections 7.7, 8.4 and 8.5 shall survive.
SECTION 8.2. CONDITIONS TO DEFEASANCE.
The Company may exercise its legal defeasance option or its covenant
defeasance option only if:
(i) the Company irrevocably deposits or causes to be deposited in
trust with the Trustee money or U.S. Government Obligations which through
the scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide cash at such times and in such
amounts as will be sufficient to pay Principal and interest when due on all
outstanding Securities (except Securities replaced pursuant to Section 2.7
or delivered to the Trustee for cancellation) to maturity or redemption, as
the case may be;
(ii) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their view
that the payments of principal and interest when due and without
reinvestment on the deposited U.S. Government Obligations plus any
deposited money without investment will provide cash at such times and in
such amounts as will be sufficient to pay Principal and interest when due
on all outstanding Securities (except Securities replaced pursuant to
Section 2.7 or delivered to the Trustee for cancellation) to maturity or
redemption, as the case may be;
(iii) no Default specified in Section 6.1(7) or (8) with respect to
the Company shall have occurred which is continuing at the time of the
deposit described in clause (i) of this Section 8.2;
(iv) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel stating that all conditions precedent to the
defeasance and discharge of the Securities as contemplated by this Article
VIII have been complied with.
Before or after a deposit, the Company may make arrangements satisfactory
to the Trustee for the redemption of Securities at a future date in accordance
with Article III.
SECTION 8.3. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to this Article VIII. It shall apply the deposited
money and the money from U.S. Government Obligations either directly or through
the Paying Agent as the Trustee may determine and in accordance with this
Indenture to the payment of Principal of and interest on the Securities.
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SECTION 8.4. REPAYMENT TO COMPANY.
The Trustee and the Paying Agent shall promptly turn over to the Company
upon request any excess money or securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon written request any money held by
them for the payment of Principal or interest that remains unclaimed for two
years after the Stated Maturity or full redemption of the Securities, and,
thereafter, Securityholders entitled to the money must look to the Company for
payment as general creditors.
SECTION 8.5. INDEMNITY FOR GOVERNMENT OBLIGATIONS.
The Company shall pay and shall indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against deposited U.S. Government
Obligations or the principal and interest received on such U.S. Government
Obligations other than any such tax, fee or other charge which by law is for the
account of the Holders of the defeased Securities; provided that the Trustee
shall be entitled to charge any such tax, fee or other charge to such Holder's
account.
SECTION 8.6. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with this Article VIII 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 obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article VIII until such time as the Trustee or Paying Agent is permitted to
apply all such money or U.S. Government Obligations in accordance with this
Article VIII; provided, however, that, (a) if the Company has made any payment
of interest on or Principal of any Securities following the reinstatement of
their obligations, the Company 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 and (b) unless otherwise
required by any legal proceeding or any order or judgment of any court or
governmental authority, the Trustee or Paying Agent shall return all such money
and U.S. Government Obligations to the Company promptly after receiving a
written request therefor at any time, if such reinstatement of the Company's
obligations has occurred and continues to be in effect.
ARTICLE IX
AMENDMENTS
SECTION 9.1. WITHOUT CONSENT OF HOLDERS.
The Company, the Subsidiary Guarantors and the Trustee may amend this
Indenture or the Securities without notice to or consent of any Securityholder:
(i) to cure any ambiguity, omission, defect or inconsistency, whether
wholly within this Indenture or as compared to any of the Collateral
Documents; or to make such other provisions in regard to matters or
questions arising under this Indenture as the Board of Directors may deem
necessary or desirable and which shall not materially and adversely affect
the rights of the Securityholders;
(ii) to comply with Article V;
(iii) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are as described in Section 163(f)(2)(B) of the Code;
(iv) to add additional Guarantees with respect to the Securities;
(v) to add additional security for the Securities;
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(vi) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the
Company;
(vii) to make any change that does not adversely affect the rights of
any Securityholder in any material respect;
(viii) to comply with, or allow for compliance with, any requirements
of the SEC in connection with qualifying this Indenture under the TIA or
giving effect to the security arrangements contemplated hereby;
(ix) to give effect to the provisions of the Collateral Documents and
this Indenture, including with regard to the release of all or a portion of
the Collateral in accordance with such provisions;
(x) to give effect to the release of any Subsidiary Guarantor in
accordance with the terms of this Indenture; and
(xi) to evidence the acceptance of the appointment of any successor
Trustee.
After an amendment under this Section 9.1 becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section 9.1.
SECTION 9.2. WITH CONSENT OF HOLDERS.
The Company, the Subsidiary Guarantors and the Trustee may amend this
Indenture or the Securities without notice to any Securityholder but with the
written consent of the Holders of at least a majority in principal amount of the
Securities then outstanding (including consents obtained in connection with a
tender offer or exchange for Securities). However, without the consent of each
Securityholder affected, an amendment to this Indenture may not:
(i) reduce the amount of Securities whose Holders must consent to an
amendment, supplement or waiver;
(ii) reduce the rate of or extend the time for payment of interest on
any Security;
(iii) reduce the principal of or extend the Stated Maturity of any
Security;
(iv) reduce the premium payable upon the redemption of any Security or
change the time at which any Security may be redeemed in accordance with
Article III;
(v) make any Security payable in money other than that stated in the
Security;
(vi) impair the right of any Holder to receive payment of Principal of
and interest on such Holder's Securities on or after the due dates therefor
or to institute suit for the enforcement of any payment on or with respect
to such Holder's Securities;
(vii) make any changes that would affect the ranking of the Securities
or (except (a) in accordance with the terms of the Collateral Documents or
this Indenture, (b) as permitted by Section 9.1 or (c) any changes to give
effect to amendments to any of the Collateral Documents) the security for
the Securities in a manner adverse to the Holders; or
(viii) make any change in the second sentence of this Section 9.2.
It shall not be necessary for the consent of the Holders under this Section
9.2 to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.2 becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section 9.2.
SECTION 9.3. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to this Indenture or the Securities shall comply with the
TIA as then in effect.
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SECTION 9.4. REVOCATION AND EFFECT OF CONSENTS AND WAIVERS.
A consent to an amendment or a waiver by a Holder of a Security shall bind
the Holder and every subsequent Holder of that Security or portion of the
Security that evidences the same debt as the consenting Holder's Security, even
if notation of the consent or waiver is not made on the Security. After an
amendment or waiver becomes effective, it shall bind every Securityholder.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Securityholders entitled to give their consent or
take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Securityholders at such
record date (or their duly designated proxies), and only those Persons, shall be
entitled to give such consent or to revoke any consent previously given or to
take any such action, whether or not such Persons continue to be Holders after
such record date. No such consent shall be valid or effective for more than 120
days after such record date.
SECTION 9.5. NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment changes the terms of a Security, the Trustee may require
the Holder of the Security to deliver it to the Trustee. The Trustee may place
an appropriate notation on the Security regarding the changed terms and return
it to the Holder. Alternatively, if the Company 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 to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.6. TRUSTEE TO SIGN AMENDMENTS.
The Trustee shall sign any amendment authorized pursuant to this Article IX
if the amendment does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may but need not sign it. In
signing such amendment the Trustee shall be entitled to receive indemnity
satisfactory to it and to receive, and shall be fully protected in relying upon,
in addition to the documents required by Section 12.4, an Officers' Certificate
and an Opinion of Counsel stating that such amendment complies with the
provisions of this Article IX.
SECTION 9.7. PAYMENT FOR CONSENT.
Neither the Company nor any affiliate of the Company shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder for, or as an inducement to any
consent, waiver or amendment of any of the terms or provisions of this Indenture
or the Securities unless such consideration is offered to be paid to all Holders
that so consent, waive or agree to amend in the time frame set forth in
solicitation documents relating to such consent, waiver or agreement.
ARTICLE X
SUBSIDIARY GUARANTEE
SECTION 10.1. SUBSIDIARY GUARANTEE.
The Subsidiary Guarantors hereby, jointly and severally, unconditionally
and irrevocably, Guarantee to each Holder and to the Trustee and its successors
and assigns (a) the full and punctual payment of Principal of, interest on and
Additional Interest, if any, with respect to the Securities when due, whether at
Stated Maturity, by acceleration, by redemption or otherwise, and all other
monetary obligations of the Company under this Indenture (including obligations
to the Trustee) and the Securities and (b) the full and punctual performance
within applicable grace periods of all other obligations of the Company under
this Indenture and the Securities (all the foregoing being hereinafter
collectively called the "Obligations"). The Subsidiary Guarantors further agree
that the Obligations may be extended or renewed, in whole or in part, without
notice or further assent from the Subsidiary Guarantors, and that the Subsidiary
Guarantors will remain bound under this Article X notwithstanding any extension
or renewal of any Obligation.
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The Subsidiary Guarantors waive presentation to, demand of, payment from
and protest to the Company of any of the Obligations and also waive notice of
protest for nonpayment. The Subsidiary Guarantors waive notice of any default
under the Securities or the Obligations. The obligations of the Subsidiary
Guarantors under this Section 10.1 shall not be affected by (a) the failure of
any Holder or the Trustee to assert any claim or demand or to enforce any right
or remedy against the Company or any other Person under this Indenture, the
Securities or any other agreement or otherwise; (b) any extension or renewal of
any Obligation; (c) any rescission, waiver, amendment, modification or
supplement of any of the terms or provisions of this Indenture (other than this
Article X), the Securities or any other agreement, unless such rescission,
waiver, amendment, modification or supplement expressly affects the obligations
of any Subsidiary Guarantor under this Section 10.1; (d) the release of any
security held by any Holder or the Trustee for the Obligations or any of them;
(e) the failure of any Holder or Trustee to exercise any right or remedy against
any other guarantor of the Obligations; or (f) any change in the ownership of
the Company.
The Subsidiary Guarantors further agree that their Guarantees herein
constitute a guarantee of payment, performance and compliance when due (and not
a guarantee of collection) and waive any right to require that any resort be had
by any Holder or the Trustee to any security held for payment of the
Obligations.
Except as set forth in this Indenture, the obligations of the Subsidiary
Guarantors hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to any
defense, setoff, counterclaim, recoupment or termination whatsoever or by reason
of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, except as set forth
in this Indenture, the obligations of the Subsidiary Guarantors herein shall not
be discharged or impaired or otherwise affected by the failure of any Holder or
the Trustee to assert any claim or demand or to enforce any remedy under this
Indenture, the Securities or any other agreement, by any waiver or modification
of any thereof, by any default, failure or delay, willful or otherwise, in the
performance of the Obligations, or by any other act or thing or omission or
delay to do any other act or thing which may or might in any manner or to any
extent vary the risk of the Subsidiary Guarantors or would otherwise operate as
a discharge of the Subsidiary Guarantors as a matter of law or equity.
The Subsidiary Guarantors further agree that their Guarantees herein shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any Obligation is rescinded or must otherwise
be restored by any Holder or the Trustee upon the bankruptcy or reorganization
of the Company or otherwise, unless such Guarantee has been released in
accordance with Section 10.9.
In furtherance of the foregoing and not in limitation of any other right
which any Holder or the Trustee has or may have at law or in equity against the
Subsidiary Guarantors by virtue hereof, upon the failure of the Company to pay
any Obligation when and as the same shall become due, whether at Stated
Maturity, by acceleration, by redemption or otherwise, or to perform or comply
with any other Obligation, the Subsidiary Guarantors hereby promise to and will,
upon receipt of written demand by the Trustee, forthwith pay, or cause to be
paid, in cash, to the Holders or the Trustee an amount equal to the sum of (i)
the unpaid principal amount of such Obligations, (ii) accrued and unpaid
interest on such Obligations (but only to the extent not prohibited by law) and
(iii) all other monetary Obligations of the Company to the Holders and the
Trustee.
The Subsidiary Guarantors agree that, as between the Subsidiary Guarantors,
on the one hand, and the Holders and the Trustee, on the other hand, (x) the
maturity of the Obligations guaranteed hereby may be accelerated as provided in
Article VI for the purposes of the Guarantee herein, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
Obligations guaranteed hereby, and (y) in the event of any declaration of
acceleration of such Obligations as provided in Article VI, such Obligations
(whether or not due and payable) shall forthwith become due and payable by the
Subsidiary Guarantors for the purposes of this Section.
The Subsidiary Guarantors also agree to pay any and all costs and expenses
(including reasonable attorneys' fees and expenses) incurred by the Trustee or
any Holder in enforcing any rights under this Section.
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SECTION 10.2. LIMITATION ON LIABILITY.
Any term or provision of this Indenture to the contrary notwithstanding,
the obligations of each Subsidiary Guarantor are limited to the maximum amount
as will result in the Obligations of such Subsidiary Guarantor under the
Subsidiary Guarantee not constituting a fraudulent conveyance or fraudulent
transfer under federal or state law.
SECTION 10.3. SUCCESSORS AND ASSIGNS.
This Article X shall inure to the benefit of the successors and assigns of
the Trustee and the Holders and, in the event of any transfer or assignment of
rights by any Holder or the Trustee, the rights and privileges conferred upon
that party in this Indenture and in the Securities shall automatically extend to
and be vested in such transferee or assignee, all subject to the terms and
conditions of this Indenture.
SECTION 10.4. NO WAIVER.
Neither a failure nor a delay on the part of either the Trustee or the
Holders in exercising any right, power or privilege under this Article X shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise of any right, power or privilege. The
rights, remedies and benefits of the Trustee and the Holders herein expressly
specified are cumulative and not exclusive of any other rights, remedies or
benefits which either may have under this Article X at law, in equity, by
statute or otherwise.
SECTION 10.5. RIGHT OF CONTRIBUTION.
Each Subsidiary Guarantor hereby agrees that to the extent that a
Subsidiary Guarantor shall have paid more than its proportionate share of any
payment made hereunder, such Subsidiary Guarantor shall be entitled to seek and
receive contribution from and against any other Subsidiary Guarantor hereunder
who has not paid its proportionate share of such payment. Each Subsidiary
Guarantor's right of contribution shall be subject to the terms and conditions
of Section 10.6. The provisions of this Section shall in no respect limit the
obligations and liabilities of any Subsidiary Guarantor to the Trustee and the
Securityholders and each Subsidiary Guarantor shall remain liable to the Trustee
and the Securityholders for the full amount guaranteed by such Subsidiary
Guarantor hereunder.
SECTION 10.6. NO SUBROGATION.
Notwithstanding any payment or payments made by any of the Subsidiary
Guarantors hereunder, no Subsidiary Guarantor shall be entitled to be subrogated
to any of the rights of the Trustee or any Securityholder against the Company or
any other Subsidiary Guarantor or any collateral security or guarantee or right
of offset held by the Trustee or any Securityholder for the payment of the
Obligations, nor shall any Subsidiary Guarantor seek or be entitled to seek any
contribution or reimbursement from the Company or any other Subsidiary Guarantor
in respect of payments made by such Subsidiary Guarantor hereunder, until all
amounts owing to the Trustee and the Securityholders by the Company on account
of the Obligations are paid in full. If any amount shall be paid to any
Subsidiary Guarantor on account of such subrogation rights at any time when all
of the Obligations shall not have been paid in full, such amount shall be held
by such Subsidiary Guarantor in trust for the Trustee and the Securityholders,
segregated from other funds of such Subsidiary Guarantor, and shall, forthwith
upon receipt by such Subsidiary Guarantor, be turned over to the Trustee in the
exact form received by such Subsidiary Guarantor (duly indorsed by such
Subsidiary Guarantor to the Trustee, if required), to be applied against the
Obligations.
SECTION 10.7. ADDITIONAL SUBSIDIARY GUARANTORS.
Until such time as all Guarantees by the Subsidiary Guarantors under this
Indenture shall have been released in accordance with Section 10.9, the Company
shall cause each Subsidiary that Guarantees the Company's obligations under the
Credit Agreement (other than a Foreign Subsidiary) to execute and deliver a
supplement to this Indenture providing that such Subsidiary will be a Subsidiary
Guarantor hereunder. Each such supplement shall be substantially in the form of
Exhibit H attached hereto. Subsidiaries that are Subsidiary Guarantors on the
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date any such supplement is executed by an additional Subsidiary shall not be
required to become parties to such supplement and hereby agree to the execution
and delivery by any additional Subsidiary of any such supplement.
SECTION 10.8. MODIFICATION.
No modification, amendment or waiver of any provision of this Article X,
nor the consent to any departure by the Subsidiary Guarantors therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
Trustee, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given; it being understood that the
release of the Guarantees of Subsidiary Guarantors pursuant to Section 10.9
shall not be an amendment or waiver of any provision of this Article X and shall
not require any action on the part of the Trustee. No notice to or demand on the
Subsidiary Guarantors in any case shall entitle the Subsidiary Guarantors to any
other or further notice or demand in the same, similar or other circumstances.
SECTION 10.9. RELEASE OF SUBSIDIARY GUARANTOR.
(a) Upon the sale or other disposition of all of the assets of any
Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or
other disposition of all of the Capital Stock of such Subsidiary Guarantor, in
each case in accordance with the terms of Section 10.10, such Subsidiary
Guarantor (in the event of a sale or other disposition, by way of such a merger,
consolidation or otherwise of all the Capital Stock of such Subsidiary
Guarantor) shall be automatically released from all its obligations under the
Indenture and the Subsidiary Guarantee without any action on the part of the
Trustee or the Holders. The Trustee shall receive written notice of the release
of any Subsidiary Guarantor if such release is effected other than under Section
10.10.
(b) Upon the release of a Guarantee by a Subsidiary of the Company's
obligations under the Credit Agreement, the Subsidiary Guarantee of such
Subsidiary under this Indenture will be released and discharged at such time and
will not be reinstated or renewed in the event any such Subsidiary thereafter
Guarantees obligations of the Company under the Credit Agreement, so long as the
Guarantee by such Subsidiary under the Credit Agreement remains released (i)
until the next succeeding refinancing, restatement, renewal, extension or
replacement of the Credit Agreement or amendment to increase the available
principal amount thereunder, or (ii) for a period of 90 consecutive days,
whichever is later.
SECTION 10.10. MERGER, CONSOLIDATION AND SALE OF ASSETS OF A SUBSIDIARY
GUARANTOR.
No Subsidiary Guarantor may consolidate with or sell or lease its assets
as, or substantially as, an entirety, to, or merge with or into, in one
transaction or a series of transactions, any other Person, unless:
(i) immediately after giving effect to such transaction, no Default or
Event of Default shall have occurred and be continuing; and
(ii) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, sale, lease, or merger complies with the foregoing clause
(i).
Notwithstanding the foregoing, each Subsidiary Guarantor may consolidate
with or merge into or sell its assets to the Company or another Subsidiary
Guarantor.
ARTICLE XI
COLLATERAL AND SECURITY
SECTION 11.1. COLLATERAL DOCUMENTS.
The due and punctual payment of the Principal and premium, if any, of, and
interest on (including Additional Interest), the Securities when and as the same
shall be due and payable, whether on an interest payment date, at maturity, by
acceleration, repurchase, redemption or otherwise, interest on the overdue
principal of and interest (to the extent permitted by law), if any, on the
Securities and performance of all other obligations under this Indenture,
including, without limitation, the obligations of the Company set forth in
Section 7.7 herein, and the Securities, shall be secured as provided in the
Collateral Documents. The Trustee, the Company and each
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Subsidiary Guarantor hereby agree that the Collateral Agent shall hold the
Collateral in trust for the equal and ratable benefit of all of the secured
creditors under the Collateral Documents, including, without limitation, the
Holders and the Trustee and the lenders under the Credit Agreement, in each case
pursuant to the terms of the Collateral Documents.
Each Holder of the Securities, by its acceptance thereof, consents and
agrees to the terms of the Collateral Documents and the Collateral Agent
Acknowledgment (including, without limitation, the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or may be
amended from time to time in accordance with their terms and authorizes and
directs (i) the Collateral Agent, with respect to each of the Collateral
Documents to which it is a party and the Collateral Agent Acknowledgment, and
(ii) the Trustee, with respect to the Collateral Agent Acknowledgment, to
perform their respective obligations and exercise their respective rights
thereunder in accordance therewith: provided, however, that upon qualification
of this Indenture with the TIA, if any provisions of the Collateral Agent
Acknowledgment limits, qualifies or conflicts with the duties imposed by the
provisions of the TIA, the TIA shall control.
The Trustee and each Holder, by accepting the Securities, acknowledges
that, as more fully set forth in the Collateral Documents, the Collateral as now
or hereafter constituted shall be held for the equal and ratable benefit of all
the secured creditors under the Collateral Documents, including, without
limitation, the lenders under the Credit Agreement and that the Lien of this
Indenture and the Collateral Documents in respect of the Trustee and the Holders
is subject to and qualified and limited in all respects by the Collateral
Documents and actions that may be taken thereunder.
As amongst the Holders, the Collateral as now or hereafter constituted
shall be held for the equal and ratable benefit of the Holders without
preference, priority or distinction of any thereof over any other by reason of
difference in time of issuance, sale or otherwise, as security for the
Securities.
SECTION 11.2. OPINIONS.
Promptly after the execution and delivery of this Indenture, the Company
shall deliver the opinion(s) required by Section 314(b)(1) of the TIA.
Subsequent to the execution and delivery of this Indenture, to the extent
required by the TIA, the Company shall furnish to the Trustee within three
months after each anniversary of the Issue Date, an Opinion of Counsel, dated as
of such date, stating either that (i) in the opinion of such counsel, all action
has been taken with respect to any filing, re-filing, recording or re-recording
with respect to the Collateral as is necessary to maintain the Lien on the
Collateral in favor of the Holders or (ii) in the opinion of such counsel, that
no such action is necessary to maintain such Lien.
SECTION 11.3. RELEASE AND SUBSTITUTION OF COLLATERAL; AMENDMENT OF COLLATERAL
DOCUMENTS.
(a) The parties hereto hereby agree and acknowledge that the Collateral may
be released by the Collateral Agent at any time in accordance with the
provisions of the Collateral Documents and the Credit Agreement or upon the
termination of the Credit Agreement and, in any such case, the Collateral so
released shall automatically be released as Collateral for the Securities
without any action on the part of the Trustee or the Securityholders. For
purposes of the TIA, the release of any Collateral from the terms of the
Collateral Documents will not be deemed to impair the security under this
Indenture in contravention of the provisions hereof or affect the Lien of this
Indenture or the Collateral Documents if and to the extent the Collateral is
released pursuant to the Collateral Documents or upon the termination of the
Credit Agreement. To the extent applicable, the Company shall cause TIA Section
314(d) relating to the release of property or securities from the lien of the
Collateral Documents and relating to the substitution therefor of any property
or securities to be subjected to the lien of the Collateral Documents to be
complied with.
(b) Notwithstanding the foregoing, the Company and each Subsidiary, as the
case may be, pursuant to the terms of the Credit Agreement and the Collateral
Documents, may
(i) sell, lease or otherwise dispose of in the ordinary course of
business free from the Liens of the Collateral Documents, any machinery,
equipment, furniture, apparatus, tools or implements, materials or supplies
or other similar property ("Subject Property") which, in its reasonable
opinion, may have become
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obsolete or unfair for use in the conduct of its businesses or the
operation of the Collateral upon replacing the same with, or substituting
for the same, new Subject Property constituting Collateral not necessarily
of the same character but being of a least equal value as the Subject
Property so disposed of as long as such new Subject Property becomes
subject to the Liens of the Collateral Documents;
(ii) abandon, sell, assign, transfer, license or otherwise dispose of
in the ordinary course of business any personal property the use of which
is no longer necessary or desirable in the proper conduct of the business
of the Company and is not material to the conduct of the business of the
Company and its Subsidiaries taken as a whole;
(iii) grant in the ordinary course of business, rights-of-way and
easements over or in respect of any of the Company's or such Subsidiary's
real property, provided that such grant will not, in the reasonable opinion
of the Company's Board of Directors, impair the usefulness of such property
in the conduct of the Company's business;
(iv) sell, transfer or otherwise dispose of inventory in the ordinary
course of business;
(v) sell, collect, liquidate, factor or otherwise dispose of accounts
receivable in the ordinary course of business;
(vi) make cash payments (including for the scheduled repayment of
Indebtedness) from cash that is at any time part of the Collateral in the
ordinary course of business that are not otherwise prohibited by this
Indenture and the Collateral Documents; and
[(vii) release any Collateral in accordance with the terms of the
Credit Agreement and the Collateral Documents or as otherwise permitted by
the lenders under the Credit Agreement,]
in each case, without the delivery of any opinions or certificates upon any such
release; provided that the Company shall deliver to the Trustee, within 15 days
after each of the six-month periods ended April 15 and October 15 in each year
an Officers' Certificate to the effect that all releases of Collateral pursuant
to this Section 11.3(b) by the Company or any Subsidiary, as the case may be,
during the preceding six-month period were in the ordinary course of the
Company's or such Subsidiary's business and that all proceeds therefrom were
used by the Company or such Subsidiary as permitted herein.
(c) The fair value of Collateral released from the Liens of the Collateral
Documents pursuant to Section 11.3(b) hereof shall not be considered in
determining whether the aggregate fair value of Collateral released from the
Liens of the Collateral Documents in any calendar year exceeds the 10% threshold
specified in Section 314(d)(l) of the TIA; provided that the Company's right to
rely on this sentence at any time is conditioned upon the Company having
furnished to the Trustee the certificates described in Section 11.3(b) hereof
that were required to be furnished to the Trustee at or prior to such time. It
is expressly understood that Section 11.3(b) and this Section 11.3(c) relate
only to the Company's obligations under the TIA and shall not restrict or
otherwise affect the Company's and its Subsidiaries' rights or abilities to
release Collateral pursuant to the terms of the Credit Agreement and the
Collateral Documents or as otherwise permitted by the lenders under the Credit
Agreement.
SECTION 11.4. CERTIFICATES OF THE COMPANY.
Subject to Section 11.3(b) the Company shall furnish to the Trustee prior
to each proposed release of Collateral all documents required by TIA sec.
314(d), if any. The Trustee may, to the extent permitted by Sections 7.1 and 7.2
hereof, accept as conclusive evidence of compliance with the foregoing
provisions the appropriate statements contained in such documents. Any
certificate or opinion required by TIA sec. 314(d), if applicable, may be made
by an Officer of the Company except in cases where TIA sec. 314(d) requires that
such certificate or opinion be made by an independent engineer, appraiser or
other expert within the meaning of TIA sec. 314(d).
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SECTION 11.5. AUTHORIZATION OF ACTIONS TO BE TAKEN BY THE TRUSTEE UNDER THE
COLLATERAL DOCUMENTS.
The Trustee shall be the Representative (as such term is defined in the
Collateral Documents) on behalf of the Holders and shall act upon the written
direction of the Holders with regard to all voting, consent and other rights
granted to the Holders under the Collateral Documents. Subject to the provisions
of the Collateral Documents and the Collateral Agent Acknowledgment, the Trustee
may, in its sole discretion and without the consent of the Holders, on behalf of
the Holders, take all actions it deems necessary or appropriate in order to (a)
enforce any of its rights or any of the rights of the Holders under the
Collateral Documents and (b) receive any and all amounts payable from the
Collateral in respect of the obligations of the Company and the Subsidiary
Guarantors hereunder. Subject to the provisions of the Collateral Documents and
the Collateral Agent Acknowledgment, the Trustee shall have the power to
institute and to maintain such suits and proceedings as it may deem expedient to
prevent any impairment of the Collateral by any acts that may be unlawful or in
violation of the Collateral Documents or this Indenture, and such suits and
proceedings as the Trustee may deem expedient to preserve or protect its
interest and the interests of the Holders in the Collateral (including power to
institute and maintain suits or proceedings to restrain the enforcement of or
compliance with any legislative or other governmental enactment, rule or order
that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the security
interest hereunder or be prejudicial to the interests of the Holders or the
Trustee).
SECTION 11.6. AUTHORIZATION OF RECEIPT OF FUNDS BY THE TRUSTEE UNDER THE
COLLATERAL DOCUMENTS.
The Trustee is authorized to receive any funds for the benefit of the
Holders distributed under the Collateral Documents, and to make further
distributions of such funds to the Holders according to the provisions of this
Indenture and the Collateral Documents.
SECTION 11.7. RELEASE UPON TERMINATION OF THE COMPANY'S OBLIGATIONS.
(a) If (i) the Company delivers an Officer's Certificate and an Opinion of
Counsel certifying that all of its obligations under this Indenture have been
satisfied and discharged by complying with the provisions of Article VIII
hereof, (ii) all outstanding Securities issued under this Indenture shall be
surrendered to the Trustee for cancellation, (iii) upon the release of the
Collateral in accordance with the terms of the Collateral Documents or (iv) any
other release of the Collateral as security for obligations of the Company or a
Subsidiary under the Credit Agreement, the Trustee shall deliver to the
Collateral Agent a notice stating that the Trustee, for itself and on behalf of
the Holders, disclaims and has given up any and all rights it has in or to the
Collateral, and any rights it has under the Collateral Documents, and, upon and
after the receipt by the Collateral Agent of such notice, the Collateral Agent
shall no longer be deemed to hold the Lien in the Collateral on behalf of the
Trustee for the benefit of the Holders. Notwithstanding the foregoing, the
conditions set forth in the foregoing sentence shall not be required to be
satisfied in connection with, and nothing contained in this Indenture shall
limit or otherwise affect, the release of the Collateral as security for the
Senior Notes, or any part of it, pursuant to the Collateral Documents or action
of the lenders under the Credit Agreement.
(b) Any release of Collateral made in compliance with this Section 11.7
shall not be deemed to impair the Lien under the Collateral Documents or the
Collateral thereunder in contravention of the provisions of this Indenture or
the Collateral Documents.
SECTION 11.8. SECURITY AGREEMENT COLLATERAL.
Notwithstanding anything to the contrary contained in this Indenture, the
Credit Agreement or the Collateral Documents, to the extent that the
representations, warranties and covenants contained in this Indenture, in the
Credit Agreement or in the Collateral Documents with respect to Collateral are
at any time incorrect (in the case of representations or warranties) or not
complied with (in the case of covenants), then in each case so long as the
aggregate fair market value of all Collateral under the Collateral Documents
with respect to which such representations or warranties are incorrect, or
covenants are not complied with, does not exceed $10,000,000 the existence of
such circumstances shall be deemed not to be a violation of this Indenture or
constitute a Default under Article VI.
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ARTICLE XII
MISCELLANEOUS
SECTION 12.1. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the provision required by the TIA shall control.
SECTION 12.2. NOTICES.
Any notice or communication shall be in writing and delivered in person or
mailed by first-class mail addressed as follows:
if to the Company or the Subsidiary Guarantors:
Coltec Industries Inc.
3 Coliseum Center
2550 West Tyvola Road
Charlotte, NC 28219
Attention: Corporate Secretary
if to the Trustee:
Bankers Trust Company
Four Albany Street
Corporate Trust & Agency Services
New York, New York 10006
Attention: Corporate Market Services
Facsimile: 212-250-6961
The Company, the Subsidiary Guarantors, or the Trustee by notice to the
others may designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Securityholder shall be mailed to
the Securityholder at the Securityholder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.
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. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 12.3. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA sec. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA sec. 312(c).
SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take or
refrain from taking any action under this Indenture, the Company shall furnish
to the Trustee:
(i) an Officers' Certificate in form and substance reasonably
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
(ii) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
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SECTION 12.5. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a covenant or
condition provided for in this Indenture shall include:
(i) a statement that the individual making such certificate or opinion
has read such covenant or condition;
(ii) 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;
(iii) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(iv) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 12.6. WHEN SECURITIES DISREGARDED.
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 or an affiliate or by any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company shall be disregarded and deemed not to be outstanding, except that, for
the purpose of determining whether the Trustee shall be protected in relying on
any such direction, waiver or consent, only Securities which a Trust Officer of
the Trustee actually knows are so owned shall be so disregarded. Also, subject
to the foregoing, only Securities outstanding at the time shall be considered in
any such determination.
SECTION 12.7. RULES BY TRUSTEE, PAYING AGENT AND REGISTRAR.
The Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
SECTION 12.8. LEGAL HOLIDAYS.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New York. If a payment
date is a Legal Holiday, payment shall be made on the next succeeding day that
is not a Legal Holiday, and no interest shall accrue on such payment for the
intervening period. If a regular record date is a Legal Holiday, the record date
shall not be affected.
SECTION 12.9. GOVERNING LAW.
This Indenture and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York but without giving effect to
applicable principles of conflicts of law to the extent that the application of
the laws of another jurisdiction would be required thereby.
SECTION 12.10. NO RECOURSE AGAINST OTHERS.
A director, officer, employee or stockholder, as such, of the Company or
the Subsidiary Guarantors shall not have any liability for any obligations of
the Company or the Subsidiary Guarantors under the Securities or this Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. By accepting a Security, each Securityholder shall waive and
release all such liability. The waiver and release shall be part of the
consideration for the issue of the Securities.
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SECTION 12.11. SUCCESSORS.
All agreements of the Company and the Subsidiary Guarantors in this
Indenture and the Securities shall bind their respective successors in
accordance with the terms hereof. All agreements of the Trustee in this
Indenture shall bind its successors.
SECTION 12.12. MULTIPLE 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. One signed copy is enough to prove this Indenture.
SECTION 12.13. QUALIFICATION OF INDENTURE.
The Company shall qualify this Indenture under the TIA in accordance with
the terms and conditions of the Registration Rights Agreement and shall pay all
reasonable costs and expenses (including reasonable attorneys' fees for the
Company, the Trustee and the Holders) incurred in connection therewith,
including, but not limited to, costs and expenses of qualification of this
Indenture and the Securities and printing this Indenture and the Securities. The
Trustee shall be entitled to receive from the Company any such Officers'
Certificates, Opinions of Counsel or other documentation as it may reasonably
request in connection with any such qualification of this Indenture under the
TIA. Notwithstanding anything else herein, any obligations imposed on the
parties hereto by the TIA (except for the opinion(s) contemplated in Section
11.2 hereof) shall not be effective until such time as the Indenture becomes
qualified under the TIA.
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SECTION 12.14. TABLE OF CONTENTS; HEADINGS.
The table of contents, cross-reference sheet and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, are not intended to be considered a part hereof and shall not modify or
restrict any of the terms or provisions hereof.
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
COLTEC INDUSTRIES INC
By: /s/ ROBERT J. TUBBS
------------------------------------
Name: Robert J. Tubbs
Title:Executive Vice President,
General Counsel and Secretary
AMI Industries Inc.
CII Holdings Inc
Coltec Canada Inc
Coltec Industrial Products Inc
Coltec International Services Co
Coltec North Carolina Inc.
Coltec Technical Services Inc
Delavan Inc (F/K/A Delavan Newco Inc.)
Garlock Inc
Garlock International Inc
Garlock Overseas Corporation
Haber Tool Company Inc
Holley Performance Products Inc
Jamco Products, LLC
Menasco Aerosystems Inc
Stemco Inc
Walbar Inc
On behalf of each of the above
Subsidiary Guarantors
By: /s/ ROBERT J. TUBBS
------------------------------------
Name: Robert J. Tubbs
Title:Executive Vice President,
General Counsel and Secretary
BANKERS TRUST COMPANY, as Trustee
By: /s/ SANDRA J. SCHAFFER
------------------------------------
Name: Sandra J. Schaffer
Title:Assist Vice President
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RULE 144A/REGULATION S APPENDIX
FOR OFFERINGS TO QUALIFIED INSTITUTIONAL BUYERS PURSUANT TO RULE 144A AND TO
CERTAIN PERSONS IN OFFSHORE TRANSACTIONS IN RELIANCE ON REGULATION S.
PROVISIONS RELATING TO INITIAL SECURITIES,
PRIVATE EXCHANGE SECURITIES
AND EXCHANGE SECURITIES
1. DEFINITIONS.
1.1 DEFINITIONS.
For the purposes of this Appendix the following terms shall have the
meanings indicated below:
"ADDITIONAL INTEREST" shall have the meaning set forth in the Registration
Rights Agreement.
"DEPOSITARY" means The Depository Trust Company, its nominees and their
respective successors and assigns.
"EXCHANGE SECURITIES" means the 7 1/2% Series B Senior Notes Due 2008 to be
issued pursuant to the Indenture in connection with a Registered Exchange Offer
pursuant to the Registration Rights Agreement.
"INITIAL PURCHASERS" means Credit Suisse First Boston Corporation, BT
Alex.Brown Incorporated, BancAmerica Robertson Stephens Inc. and NationsBanc
Montgomery Securities LLC.
"INITIAL SECURITIES" means the 7 1/2% Senior Notes Due 2008, issued under
the Indenture on the date hereof.
"PRIVATE EXCHANGE" means the offer by the Company, pursuant to the
Registration Rights Agreement, to the Initial Purchasers to issue and deliver to
each Initial Purchaser, in exchange for the Initial Securities held by the
Initial Purchaser as part of its initial distribution, a like aggregate
principal amount of Private Exchange Securities.
"PRIVATE EXCHANGE SECURITIES" means the 7 1/2% Series C Senior Notes Due
2008, if any, to be issued pursuant to the Indenture to the Initial Purchasers
in a Private Exchange.
"PURCHASE AGREEMENT" means the Purchase Agreement dated April 8, 1998,
among the Company, the Subsidiary Guarantors and the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"REGISTERED EXCHANGE OFFER" means the offer by the Company, pursuant to the
Registration Rights Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for the Initial Securities, a
like aggregate principal amount of Exchange Securities registered under the
Securities Act.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement
dated April 16, 1998 among the Company, the Subsidiary Guarantors and the
Initial Purchasers.
"SECURITIES" means the Initial Securities, the Exchange Securities and the
Private Exchange Securities, treated as a single class.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES CUSTODIAN" means the custodian with respect to a Global
Security (as appointed by the Depositary), or any successor person thereto and
shall initially be the Trustee.
"SHELF REGISTRATION STATEMENT" means the registration statement issued by
the Company, in connection with the offer and sale of Initial Securities or
Private Exchange Securities, pursuant to the Registration Rights Agreement.
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"TRANSFER RESTRICTED SECURITIES" means Securities that bear or are required
to bear the legend set forth in Section 2.3(d) hereto.
1.2 OTHER DEFINITIONS
DEFINED IN
TERM SECTION:
---- ----------
"Agent Members"............................................. 2.1(b)
"Global Security"........................................... 2.1(a)
"Regulation S".............................................. 2.1(a)
"Rule 144A"................................................. 2.1(a)
2. THE SECURITIES.
2.1 FORM AND DATING.
The Initial Securities are being offered and sold by the Company pursuant
to the Purchase Agreement.
(a) Global Securities. Initial Securities offered and sold to a QIB in
reliance on Rule 144A under the Securities Act ("Rule 144A") or in reliance on
Regulation S under the Securities Act ("Regulation S"), in each case as provided
in the Purchase Agreement, shall be issued initially in the form of one or more
permanent global Securities in definitive, fully registered form without
interest coupons with the global securities legend and restricted securities
legend set forth in Exhibit 1 hereto (each, a "Global Security"), which shall be
deposited on behalf of the purchasers of the Initial Securities represented
thereby with the Trustee as custodian for the Depositary (or with such other
custodian as the Depositary may direct), and registered in the name of the
Depositary or a nominee of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Global Securities may from time to time be increased or decreased
by adjustments made on the records of the Trustee and the Depositary or its
nominee as hereinafter provided.
(b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a
Global Security deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with this
Section 2.1(b), authenticate and deliver initially one or more Global Securities
that (a) shall be registered in the name of the Depositary for such Global
Security or Global Securities or the nominee of such Depositary and (b) shall be
delivered by the Trustee to such Depositary or pursuant to such Depositary's
instructions or held by the Trustee as custodian for the Depositary.
Members of, or participants in, the Depositary ("Agent Members") shall have
no rights under the Indenture with respect to any Global Security held on their
behalf by the Depositary or by the Trustee as the custodian of the Depositary or
under such Global Security, and the Depositary 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. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices of such
Depositary governing the exercise of the rights of a holder of a beneficial
interest in any Global Security.
(c) Certificated Securities. Except as provided in this Section 2.1 or
Section 2.3 or 2.4, owners of beneficial interests in Global Securities will not
be entitled to receive physical delivery of certificated Securities.
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2.2 AUTHENTICATION.
The Trustee shall authenticate and deliver: (1) Initial Securities for
original issue in an aggregate principal amount of U.S.$300.0 million and (2)
Exchange Securities or Private Exchange Securities for issue only in a
Registered Exchange Offer or a Private Exchange, respectively, pursuant to the
Registration Rights Agreement, for a like principal amount of Initial
Securities, in each case upon a written order of the Company signed by two
Officers or by an Officer and either an Assistant Treasurer or an Assistant
Secretary of the Company. Such order shall specify the amount of the Securities
to be authenticated and the date on which the original issue of Securities is to
be authenticated and whether the Securities are to be Initial Securities,
Exchange Securities or Private Exchange Securities and shall also specify
delivery instructions for such securities. The aggregate principal amount of
Securities outstanding at any time may not exceed U.S.$300.0 million except as
provided in Section 2.7 of the Indenture.
2.3 TRANSFER AND EXCHANGE.
(a) Transfer and Exchange of Global Securities.
(i) The transfer and exchange of Global Securities or beneficial
interests therein shall be effected through the Depositary, in accordance
with the Indenture (including applicable restrictions on transfer set forth
herein, if any) and the procedures of the Depositary therefor. A transferor
of a beneficial interest in a Global Security shall deliver to the
Registrar a written order given in accordance with the Depositary's
procedures containing information regarding the participant account of the
Depositary to be credited with a beneficial interest in the Global
Security. The Registrar shall, in accordance with such instructions,
instruct the Depositary to credit to the account of the Person specified in
such instructions a beneficial interest in the Global Security and to debit
the account of the Person making the transfer the beneficial interest in
the Global Security being transferred.
(ii) Notwithstanding any other provisions of this Appendix (other than
the provisions set forth in Section 2.4), a Global Security may not be
transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary of another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(iii) In the event that a Global Security is exchanged for Securities
in definitive registered form pursuant to Section 2.4 of this Appendix or
Section 2.9 of the Indenture, prior to the consummation of a Registered
Exchange Offer or the effectiveness of a Shelf Registration Statement with
respect to such Securities, such Securities may be exchanged only in
accordance with such procedures as are substantially consistent with the
provisions of this Section 2.3 (including the certification requirements
set forth on the reverse of the Initial Securities intended to ensure that
such transfers comply with Rule 144A or Regulation S, as the case may be)
and such other procedures as may from time to time be adopted by the
Company.
(b) Legend.
(i) Except as permitted by the following paragraphs (ii), (iii) and
(iv), each Security certificate evidencing the Global Securities (and all
Securities issued in exchange therefor or in substitution thereof) shall
bear a legend in substantially the following form:
"THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND THIS NOTE MAY NOT
BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS
NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
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THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE ISSUER THAT (A)
THIS NOTE MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
(i) INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (ii) OUTSIDE THE UNITED STATES IN A
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(iii) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (iv) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH OF CASES (i) THROUGH (iv) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted Security
(including any Transfer Restricted Security represented by a Global
Security) pursuant to Rule 144 under the Securities Act, in the case of any
Transfer Restricted Security that is represented by a Global Security, the
Registrar shall permit the Holder thereof to exchange such Transfer
Restricted Security for a certificated Security that does not bear the
legend set forth above and rescind any restriction on the transfer of such
Transfer Restricted Security, if the Holder certifies in writing to the
Registrar that its request for such exchange was made in reliance on Rule
144 (such certification to be in the form set forth on the reverse of the
Security).
(iii) After a transfer of any Initial Securities or Private Exchange
Securities during the period of the effectiveness of a Shelf Registration
Statement with respect to such Initial Securities or Private Exchange
Securities, as the case may be, all requirements pertaining to legends on
such Initial Securities or such Private Exchange Securities will cease to
apply, but the requirements requiring such Initial Securities or such
Private Exchange Securities issued to certain Holders be issued in global
form will continue to apply, and Initial Securities or Private Exchange
Securities in global form without legends will be available to the
transferee of the Holder of such Initial Securities or Private Exchange
Securities upon exchange of such transferring Holder's Initial Securities
or Private Exchange Securities or directions to transfer such Holder's
interest in the Global Security, as applicable.
(iv) Upon the consummation of a Registered Exchange Offer with respect
to the Initial Securities pursuant to which Holders of such Initial
Securities are offered Exchange Securities in exchange for their Initial
Securities, all requirements pertaining to such Initial Securities that
Initial Securities issued to certain Holders be issued in global form will
continue to apply and Initial Securities in global form with the restricted
securities legend set forth in Exhibit 1 hereto will be available to
Holders of such Initial Securities that do not exchange their Initial
Securities, and Exchange Securities in global form will be available to
Holders that exchange such Initial Securities in such Registered Exchange
Offer.
(v) Upon the consummation of a Private Exchange with respect to the
Initial Securities pursuant to which Holders of such Initial Securities are
offered Private Exchange Securities in exchange for their Initial
Securities, all requirements pertaining to such Initial Securities that
Initial Securities issued to certain Holders be issued in global form will
still apply, and Private Exchange Securities in global form with the
Restricted Securities Legend set forth in Exhibit 1 hereto will be
available to Holders that exchange such Initial Securities in such Private
Exchange.
(c) Cancellation or Adjustment of Global Security. At such time as all
beneficial interests in a Global Security have either been exchanged for
certificated Securities, redeemed, repurchased or canceled, such Global Security
shall be returned to the Depositary for cancellation or retained and canceled by
the Trustee. At any time prior to such cancellation, if any beneficial interest
in a Global Security is exchanged for certificated Securities, redeemed,
repurchased or canceled, the principal amount of Securities represented by such
Global Security shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Securities
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Custodian for such Global Security) with respect to such Global Security, by the
Trustee or the Securities Custodian, to reflect such reduction.
(d) Obligations with Respect to Transfers and Exchanges of Securities.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and the Trustee shall authenticate certificated Securities
and Global Securities at the Registrar's or any co-registrar's request.
(ii) 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, assessments, or similar governmental charge payable
in connection therewith (other than any such transfer taxes, assessments or
similar governmental charge payable upon exchange or transfer pursuant to
Sections 3.6 and Section 9.5.
(iii) The Registrar or any co-registrar shall not be required to
register the transfer of or exchange of (a) any certificated Security
selected for redemption in whole or in part pursuant to Article III of the
Indenture, except the unredeemed portion of any certificated Security being
redeemed in part, or (b) any Security for a period beginning 15 Business
Days before the mailing of a notice of redemption of Securities.
(iv) Prior to the due presentation for registration of transfer of any
Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of
receiving payment of Principal of and interest on such Security and for all
other purposes whatsoever, whether or not such Security is overdue, and
none of the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar shall be affected by notice to the contrary.
(v) All Securities issued upon any transfer or exchange pursuant to
the terms of the Indenture shall evidence the same debt and shall be
entitled to the same benefits under the Indenture as the Securities
surrendered upon such transfer or exchange.
(e) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Security, a member of, or a participant in the
Depositary or other Person with respect to the accuracy of the records of
the Depositary or its nominee or of any participant or member thereof, with
respect to any ownership interest in the Securities or with respect to the
delivery to any participant, member, beneficial owner or other Person
(other than the Depositary) of any notice (including any notice of
redemption) or the payment of any amount, under or with respect to such
Securities. All notices and communications to be given to the Holders and
all payments to be made to Holders under the Securities shall be given or
made only to or upon the order of the registered Holders (which shall be
the Depositary or its nominee in the case of a Global Security). The rights
of beneficial owners in any Global Security shall be exercised only through
the Depositary subject to the applicable rules and procedures of the
Depositary. The Trustee may rely and shall be fully protected in relying
upon information furnished by the Depositary with respect to its members,
participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under the Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between
or among Depositary participants, members or beneficial owners in any
Global Security) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do so
if and when expressly required by, the terms of the Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
5
47
2.4 CERTIFICATED SECURITIES.
(a) A Global Security deposited with the Depositary or with the Trustee as
custodian for the Depositary pursuant to Section 2.1 shall be transferred to the
beneficial owners thereof in the form of certificated Securities in an aggregate
principal amount equal to the principal amount of such Global Security, in
exchange for such Global Security, only if such transfer complies with Section
2.3 and (i) the Depositary notifies the Company that it is unwilling or unable
to continue as Depositary for such Global Security or if at any time such
Depositary ceases to be a "clearing agency" registered under the Exchange Act
and a successor depositary is not appointed by the Company within 90 days of
such notice, or (ii) an Event of Default has occurred and is continuing or (iii)
the Company, in its sole discretion, notifies the Trustee in writing that it
elects to cause the issuance of certificated Securities under the Indenture.
(b) Any Global Security that is transferable to the beneficial owners
thereof pursuant to this Section shall be surrendered by the Depositary to the
Trustee, to be so transferred, in whole or from time to time in part, without
charge, and the Trustee shall authenticate and deliver, upon such transfer of
each portion of such Global Security, an equal aggregate principal amount of
certificated Initial Securities of authorized denominations. Any portion of a
Global Security transferred pursuant to this Section shall be executed,
authenticated and delivered only in denominations of $1,000 and any integral
multiple thereof and registered in such names as the Depositary shall direct.
Any certificated Initial Security delivered in exchange for an interest in the
Global Security shall, except as otherwise provided by Section 2.3(d), bear the
restricted securities legend set forth in Exhibit 1 hereto.
(c) Subject to the provisions of Section 2.4(b), the registered Holder of a
Global Security may grant proxies and otherwise authorize any Person, including
Agent Members and Persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under the Indenture or the
Securities.
(d) In the event of the occurrence of either of the events specified in
Section 2.4(a), the Company will promptly make available to the Trustee a
reasonable supply of certificated Securities in definitive, fully registered
form without interest coupons.
6
48
EXHIBIT 1
TO RULE 144A/REGULATION S
APPENDIX
[FORM OF FACE OF INITIAL SECURITY]
[GLOBAL SECURITIES LEGEND]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[RESTRICTED SECURITIES LEGEND]
THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS NOTE MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF
THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF
THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) THIS
NOTE MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (i) INSIDE THE
UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (ii) OUTSIDE THE UNITED
STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT,
(iii) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (iv) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (i) THROUGH
(iv) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.
49
COLTEC INDUSTRIES INC
No. 1 Principal Amount $ ___________________
CUSIP NO. ___________________
7 1/2% SENIOR NOTE DUE 2008
Coltec Industries Inc., a Pennsylvania corporation, promises to pay to CEDE
& Co., or registered assigns, the principal sum of
____________________________ Dollars on April 15, 2008.
Interest Payment Dates: April 15 and October 15.
Record Dates: April 1 and October 1.
Additional provisions of this Security are set forth on the other side of
this Security.
Dated: April 16, 1998
COLTEC INDUSTRIES INC
by
by
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the Securities referred
to in the Indenture.
BANKERS TRUST COMPANY
as Trustee
by
Authorized Signatory
50
[FORM OF REVERSE SIDE OF INITIAL SECURITY]
(REVERSE OF SECURITY)
7 1/2% SENIOR NOTE DUE 2008
1. INTEREST
Coltec Industries Inc, a Pennsylvania corporation (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Company"), promises to pay interest on the principal amount
of this Security at the rate per annum shown above; provided, however, that if a
Registration Default (as defined in the Registration Rights Agreement) occurs,
additional cash interest will accrue on this Security at a rate of 0.50% per
annum from and including the date on which any such Registration Default shall
occur (subject to the terms of the Registration Rights Agreement) to but
excluding the date on which all Registration Defaults have been cured,
calculated on the principal amount of this Security as of the date on which such
interest is payable. Such interest is payable in addition to any other interest
payable from time to time with respect to this Security. The Trustee will not be
deemed to have notice of a Registration Default until it shall have received
actual notice of such Registration Default.
The Company will pay interest semiannually on April 15 and October 15 of
each year, commencing October 15, 1998. Interest on the Securities will accrue
from the most recent date to which interest has been paid on the Securities or,
if no interest has been paid, from April 16, 1998. Interest will be computed on
the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT
By at least 11:00 a.m. (New York City time) on the date on which any
Principal of or interest on any Security is due and payable, the Company shall
irrevocably deposit with the Trustee or the Paying Agent money sufficient to pay
such Principal and/or interest. The Company will pay interest (except defaulted
interest) to the Persons who are registered Holders of Securities at the close
of business on the April 1 or October 1 next preceding the interest payment
date. Holders must surrender Securities to a Paying Agent to collect principal
payments. The Company will pay Principal and interest in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may pay Principal and interest by check
payable in such money. It may mail an interest check to a Holder's registered
address.
3. PAYING AGENT AND REGISTRAR
Initially, Bankers Trust Company, a New York banking corporation (the
"Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice to any
Securityholder. The Company or any of its domestically incorporated wholly owned
Subsidiaries may act as Paying Agent.
4. INDENTURE
The Company issued the Securities under an Indenture dated as of April 16,
1998 (as it may be amended or supplemented from time to time in accordance with
the terms thereof, the "Indenture"), among the Company, the Subsidiary
Guarantors and the Trustee. Capitalized terms used herein and not defined herein
have the meanings ascribed thereto in the Indenture. The Securities are subject
to all such terms, and Securityholders are referred to the Indenture for a
statement of those terms.
The Securities are senior obligations of the Company limited to $300.0
million aggregate principal amount (subject to Section 2.7 of the Indenture).
The Security is one of the Initial Securities referred to in the Indenture. The
Securities include the Initial Securities and any Private Exchange Securities
and Exchange Securities issued in exchange for the Initial Securities pursuant
to the Indenture and the Registration Rights Agreement. The Initial Securities,
the Private Exchange Securities and the Exchange Securities are treated as a
single class of securities
51
under the Indenture. The Indenture imposes certain limitations on the ability of
the Company to create liens, enter into sale and leaseback transactions and
enter into mergers and consolidations.
To guarantee the due and punctual payment of the Principal and interest, if
any, on the Securities and all other amounts payable by the Company under the
Indenture and the Securities when and as the same shall be due and payable,
whether at maturity, by acceleration or otherwise, according to the terms of the
Securities and the Indenture, the Subsidiary Guarantors, as primary obligors and
not merely as surety, have unconditionally and irrevocably guaranteed, on a
joint and several basis, such obligations on a senior basis pursuant to the
terms of Article X of the Indenture.
The Securities are secured to the extent set forth in the Collateral
Documents and Article XI of the Indenture.
5. OPTIONAL REDEMPTION
The Securities will be redeemable, in whole or in part, at any time, at the
option of the Company, at a redemption price equal to the greater of (i) 100% of
the principal amount of such Securities and (ii) the sum of the present value of
the remaining scheduled payments of principal and interest thereon from the
redemption date to the maturity date, discounted to the redemption date on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate plus 37.5 basis points, plus accrued interest thereon to the
date of redemption.
"TREASURY RATE" means, with respect to any redemption date for the
Securities, (i) the yield, under the heading which represents the average for
the immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which is
published weekly by the Board of Governors of the Federal Reserve System and
which establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury Constant Maturities,"
for the maturity corresponding to the Comparable Treasury Issue (if no maturity
is within three months before or after the Maturity Date, yields for the two
published maturities most closely corresponding to the Comparable Treasury Issue
shall be determined and the Treasury Rate shall be interpolated or extrapolated
from such yields on a straight line basis, rounding to the nearest month) or
(ii) if such release (or any successor release) is not published during the week
preceding the calculation date or does not contain such yields, the rate per
annum equal to the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date. The Treasury Rate shall be calculated
on the third Business Day preceding the redemption date.
"COMPARABLE TREASURY ISSUE" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the Securities to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such Securities. "Independent Investment Banker" means one of
the Reference Treasury Dealers appointed by the Trustee after consultation with
the Company.
"COMPARABLE TREASURY PRICE" means with respect to any redemption date for
the Securities (i) the average of four Reference Treasury Dealer Quotations for
such redemption date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all such quotations.
"REFERENCE TREASURY DEALER" means each of Credit Suisse First Boston
Corporation, BT Alex. Brown Incorporated and two other primary U.S. Government
securities dealers in New York City (each, a "Primary Treasury Dealer")
appointed by the Trustee in consultation with the Company; provided, however,
that if any of the foregoing shall cease to be a Primary Treasury Dealer, the
Company shall substitute therefor another Primary Treasury Dealer.
2
52
"REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such redemption date.
Except as set forth above, the Securities will not be redeemable by the
Company prior to maturity and will not be entitled to the benefit of any sinking
fund.
6. NOTICE OF REDEMPTION
Notice of redemption will be mailed at least 30 days but not more than 60
days before the redemption date by first-class mail to each Holder of Securities
to be redeemed at his registered address. Securities in denominations of
principal amount larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000. If money sufficient to pay the redemption price of and
accrued and unpaid interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.
7. REGISTRATION RIGHTS
The Company is party to a Registration Rights Agreement, dated as of April
16, 1998, among the Company, the Subsidiary Guarantors, Credit Suisse First
Boston Corporation, BT Alex.Brown Incorporated, BancAmerica Robertson Stephens
Inc. and NationsBanc Montgomery Securities LLC pursuant to which it is obligated
to pay Additional Interest (as defined therein) upon the occurrence of certain
Registration Defaults (as defined therein).
8. DENOMINATIONS; TRANSFER; EXCHANGE
The Securities are in registered form without coupons in denominations of
principal amount of $1,000 and whole multiples of $1,000. A Holder may register,
transfer or exchange Securities in accordance with the Indenture. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange (i)
any Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) for a period
beginning 15 days before a selection of Securities to be redeemed and ending on
the date of such selection or (ii) any Securities for a period beginning 15 days
before an interest payment date and ending on such interest payment date.
9. PERSONS DEEMED OWNERS
The registered holder of this Security may be treated as the owner of it
for all purposes.
10. UNCLAIMED MONEY
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon written request any money held by
them for the payment of Principal or interest that remains unclaimed for two
years after the Stated Maturity or full redemption of the Securities, and,
thereafter, Securityholders entitled to the money must look to the Company for
payment as general creditors.
11. DEFEASANCE
Subject to certain conditions set forth in the Indenture, the Company at
any time may terminate some or all of its obligations and the obligations of the
Subsidiary Guarantors under the Securities and the Indenture if the Company
deposits with the Trustee money or U.S. Government Obligations for the payment
of Principal of and interest on the Securities to redemption or maturity, as the
case may be.
3
53
12. AMENDMENT, WAIVER
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in principal amount of the outstanding Securities and (ii) any
default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount of the outstanding
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Company, the Subsidiary Guarantors and
the Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency whether wholly within the Indenture or as
compared to any of the Collateral Documents, or to make such other provisions in
regard to matters or questions arising under the Indenture as the Board of
Directors of the Company may deem necessary or desirable and which shall not
materially and adversely affect the rights of the Holders, or to comply with
Article 5 of the Indenture, or to provide for uncertificated Securities in
addition to or in place of certificated Securities, or to add additional
guarantees with respect to the Securities or to add additional security for the
Securities, or to add additional covenants of or surrender rights and powers
conferred on the Company, or to comply, or allow compliance with, any
requirement of the SEC in connection with qualifying the Indenture under the Act
or giving effect to the security arrangements contemplated by the Indenture, or
to make any change that does not adversely affect the rights of any
Securityholder in any material respect or to give effect to the provisions of
the Collateral Documents and the Indenture, including with regard to the release
of all or a portion of the Collateral in accordance with such provisions and to
give effect to the release of any Subsidiary Guarantee in accordance with the
terms of the Indenture.
13. DEFAULTS AND REMEDIES
Under the Indenture, Events of Default include (i) default for 30 days in
any payment of interest on the Securities when due, that continues for 30 days;
(ii) default in payment of Principal on the Securities when due at its Stated
Maturity, upon declaration or otherwise; (iii) failure by the Company or the
Subsidiary Guarantors to comply with other agreements in the Indenture or the
Securities, in certain cases subject to notice and lapse of time; (iv) certain
accelerations (including failure to pay within any grace period after final
maturity) of other indebtedness of the Company, the Subsidiary Guarantors or any
of the Company's Subsidiaries if the amount accelerated (or so unpaid) exceeds
$30 million; (v) certain events of bankruptcy or insolvency with respect to the
Company or any Significant Subsidiary; (vi) certain judgments or decrees for the
payment of money in excess of $30 million against the Company or any Significant
Subsidiary; (vii) except as permitted under the Indenture, a Subsidiary
Guarantee ceases to be in full force and effect for 30 days after notice or a
Subsidiary Guarantor denies or disaffirms its obligations under its Subsidiary
Guarantee; or (viii) except as permitted by the Collateral Documents, the Credit
Agreement and the Indenture or any amendment thereto, any of the Collateral
Documents ceases to be in full force and effect or ceases to be effective, in
all material respects, to create a Lien on the Collateral in favor of the Senior
Noteholders for 30 days after notice.
If an Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in aggregate principal amount of the Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default or
Event of Default (except a Default or Event of Default in payment of Principal
or interest) if it determines that withholding notice is not opposed to their
interest.
4
54
14. TRUSTEE DEALINGS WITH THE COMPANY
Subject to certain limitations set forth in the Indenture, 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 and collect
obligations owed to it by the Company or its affiliates and may otherwise deal
with the Company or its affiliates with the same rights it would have if it were
not Trustee.
15. NO RECOURSE AGAINST OTHERS
A director, officer, employee or stockholder, as such, of the Company or
the Subsidiary Guarantors shall not have any liability for any obligations of
the Company or the Subsidiary Guarantors under the Securities or the Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. By accepting a Security, each Securityholder waives and releases
all such liability. The waiver and release are part of the consideration for the
issue of the Securities.
16. AUTHENTICATION
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent acting on its behalf) manually signs the
certificate of authentication on the other side of this Security.
17. ABBREVIATIONS
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants
in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
18. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
19. GOVERNING LAW
This Security shall be governed by, and construed in accordance with, the
laws of the State of New York but without giving effect to applicable principles
of conflicts of law to the extent that the application of the laws of another
jurisdiction would be required thereby.
The Company will furnish to any Securityholder upon written request and
without charge to the Securityholder a copy of the Indenture which has in it the
text of this Security in larger type. Requests may be made to: Coltec Industries
Inc, 3 Coliseum Center, 2550 West Tyvola Road, Charlotte, NC 28217 Attention:
Chief Financial Officer.
5
55
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
- --------------------------------------------------------------------------------
Date: Your Signature:
Signature Guarantee: ___________________________________________
(Signature must be guaranteed by a participant in a recognized Signature
Guarantee Medallion Program or other signature guarantor program reasonably
acceptable to the Trustee)
- --------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the date that is two years after the
later of the date of original issuance of such Securities and the last date, if
any, on which such Securities were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Securities are being transferred:
CHECK ONE BOX BELOW:
(1)[ ] to the Company; or
(2)[ ] pursuant to an effective registration statement under the
Securities Act of 1933; or
(3)[ ] inside the United States to a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act of 1933) that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that such transfer is
being made in reliance on Rule 144A, in each case pursuant to and
in compliance with Rule 144A under the Securities Act of 1933; or
(4)[ ] outside the United States in an offshore transaction within the
meaning of Regulation S under the Securities Act in compliance with
Rule 904 under the Securities Act of 1933; or
(5)[ ] pursuant to another available exemption from registration provided
by Rule 144 under the Securities act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any Person other
than the registered holder thereof; provided, however, that if box (4) or (5) is
checked, the Trustee may require, prior to registering any such transfer of the
Securities, such legal opinions, certifications and other information as the
Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933, such as the exemption
provided by Rule 144 under such Act.
--------
Signature Guarantee: Signature
- ------------------------------------------------------ --------
(Signature must be guaranteed by a participant in a Signature
recognized Signature Guarantee Medallion Program or other
signature guarantor program reasonably acceptable to the
Trustee)
- --------------------------------------------------------------------------------
56
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated: ------------------------------------ ---------------------------------------------------
NOTICE: To be executed by
an executive officer
57
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have been
made:
AMOUNT OF DECREASE AMOUNT OF INCREASE PRINCIPAL AMOUNT OF SIGNATURE OF
IN PRINCIPAL AMOUNT IN PRINCIPAL AMOUNT THIS GLOBAL SECURITY AUTHORIZED OFFICER
DATE OF OF THIS GLOBAL OF THIS GLOBAL FOLLOWING SUCH OF TRUSTEE OR
EXCHANGE SECURITY SECURITY DECREASE OR INCREASE SECURITIES CUSTODIAN
-------- ------------------- ------------------- -------------------- --------------------
58
EXHIBIT A
[FORM OF FACE OF EXCHANGE SECURITY [OR PRIVATE
EXCHANGE SECURITY]]
*/
**/
COLTEC INDUSTRIES INC.
No. ____ Principal Amount $ ___________________
CUSIP NO. ___________________
7 1/2% SENIOR NOTE DUE 2008
Coltec Industries Inc., a Pennsylvania corporation, promises to pay to CEDE
& Co., or registered assigns, the principal sum of ___________________ Dollars
on April 15, 2008.
Interest Payment Dates: April 15 and October 15.
Record Dates: April 1 and October 1.
Additional provisions of this Security are set forth on the other side of
this Security.
Dated: _____________________
COLTEC INDUSTRIES INC
by
by
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the Securities referred
to in
the Indenture.
BANKERS TRUST COMPANY
by
Authorized Signatory
- ---------------
*/ [If the Security is to be issued in global form add the Global Securities
Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1
Captioned "[TO BE ATTACHED TO GLOBAL SECURITIES] -- SCHEDULE OF INCREASES
OR DECREASES IN GLOBAL SECURITY".]
**/ [If the Security is a Private Exchange Security issued in a Private Exchange
to an Initial Purchaser holding an unsold portion of its initial allotment,
add the Restricted Securities Legend from Exhibit 1 to Appendix A and
replace the Assignment Form included in such Exhibit 1.]
59
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY [OR
PRIVATE EXCHANGE SECURITY]]
7 1/2% SENIOR NOTE DUE 2008
1. INTEREST
Coltec Industries Inc., a Pennsylvania corporation (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Company"), promises to pay interest on the principal amount
of this Security at the rate per annum shown above[; provided, however, that if
a Registration Default (as defined in the Registration Rights Agreement) occurs,
additional cash interest will accrue on this Security at a rate of 0.50% per
annum from and including the date on which any such Registration Default shall
occur to but excluding the date on which all Registration Defaults have been
cured, calculated on the principal amount of this Security as of the date on
which such interest is payable. Such interest is payable in addition to any
other interest payable from time to time with respect to this Security. The
Trustee will not be deemed to have notice of a Registration Default until it
shall have received actual notice of such Registration Default].***/
The Company will pay interest semiannually on April 15 and October 15 of
each year, commencing October 15, 1998 Interest on the Securities will accrue
from the most recent date to which interest has been paid on the Securities or,
if no interest has been paid, from April 16, 1998. Interest will be computed on
the basis of a 360-day year of twelve 30-day months.
2. METHOD OF PAYMENT
By at least 11:00 a.m. (New York City time) on the date on which any
Principal of or interest on any Security is due and payable, the Company shall
irrevocably deposit with the Trustee or the Paying Agent money sufficient to pay
such Principal and/or interest. The Company will pay interest (except defaulted
interest) to the Persons who are registered Holders of Securities at the close
of business on the April 1 or October 1 next preceding the interest payment date
even if Securities are cancelled, repurchased or redeemed after the record date
and on or before the interest payment date. Holders must surrender Securities to
a Paying Agent to collect principal payments. The Company will pay Principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
Principal and interest by check payable in such money. It may mail an interest
check to a Holder's registered address.
3. PAYING AGENT AND REGISTRAR
Initially, Bankers Trust Company, a New York banking corporation (the
"Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice to any
Securityholder. The Company or any of its domestically incorporated wholly owned
Subsidiaries may act as Paying Agent.
4. INDENTURE
The Company issued the Securities under an Indenture dated as of April 16,
1998 (as it may be amended or supplemented from time to time in accordance with
the terms thereof, the "Indenture"), among the Company Subsidiary, the
Subsidiary Guarantors and the Trustee. 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. sec.sec. 77aaa-77bbbb) as in effect on
the date of the Indenture (the "Act"). Capitalized terms used
- ---------------
***/ Insert if at the time of issuance of the Exchange Security or Private
Exchange Security (as the case may be) neither the Registered Exchange
Offer has been consummated nor a Shelf Registration Statement has been
declared effective in accordance with the Registration Rights Agreement.
60
herein and not defined herein have the meanings ascribed thereto in the
Indenture. The Securities are subject to all such terms, and Securityholders are
referred to the Indenture and the Act for a statement of those terms.
The Securities are senior obligations of the Company limited to $300.0
million aggregate principal amount (subject to Section 2.7 of the Indenture).
The Security is one of the Exchange Securities referred to in the Indenture. The
Securities include the Initial Securities and any Private Exchange Securities
and Exchange Securities issued in exchange for the Initial Securities pursuant
to the Indenture and the Registration Rights Agreement. The Initial Securities,
the Private Exchange Securities and the Exchange Securities are treated as a
single class of securities under the Indenture. The Indenture imposes certain
limitations on the ability of the Company to create liens, enter into sale and
leaseback transactions and enter into mergers and consolidations.
To guarantee the due and punctual payment of the Principal and interest, if
any, on the Securities and all other amounts payable by the Company under the
Indenture and the Securities when and as the same shall be due and payable,
whether at maturity, by acceleration or otherwise, according to the terms of the
Securities and the Indenture, the Subsidiary Guarantors, as primary obligors and
not merely as surety, have unconditionally and irrevocably guaranteed, on a
joint and several basis, such obligations on a senior basis pursuant to the
terms of Article X of the Indenture.
The Securities are secured to the extent set forth in Article XI of the
Indenture.
5. OPTIONAL REDEMPTION
The Securities will be redeemable, in whole or in part, at any time, at the
option of the Company, at a redemption price equal to the greater of (i) 100% of
the principal amount of such Securities and (ii) the sum of the present value of
the remaining scheduled payments of principal and interest thereon from the
redemption date to the maturity date, discounted to the redemption date on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate plus 37.5 basis points, plus accrued interest thereon to the
date of redemption.
"TREASURY RATE" means, with respect to any redemption date for the
Securities, (i) the yield, under the heading which represents the average for
the immediately preceding week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which is
published weekly by the Board of Governors of the Federal Reserve System and
which establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury Constant Maturities,"
for the maturity corresponding to the Comparable Treasury Issue (if no maturity
is within three months before or after the Maturity Date, yields for the two
published maturities most closely corresponding to the Comparable Treasury Issue
shall be determined and the Treasury Rate shall be interpolated or extrapolated
from such yields on a straight line basis, rounding to the nearest month) or
(ii) if such release (or any successor release) is not published during the week
preceding the calculation date or does not contain such yields, the rate per
annum equal to the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date. The Treasury Rate shall be calculated
on the third Business Day preceding the redemption date.
"COMPARABLE TREASURY ISSUE" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the Securities to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such Securities. "Independent Investment Banker" means one of
the Reference Treasury Dealers appointed by the Trustee after consultation with
the Company.
"COMPARABLE TREASURY PRICE" means with respect to any redemption date for
the Securities (i) the average of four Reference Treasury Dealer Quotations for
such redemption date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (ii) if the Trustee obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all such quotations.
2
61
"REFERENCE TREASURY DEALER" means each of Credit Suisse First Boston
Corporation, BT Alex. Brown Incorporated and two other primary U.S. Government
securities dealers in New York City (each, a "Primary Treasury Dealer")
appointed by the Trustee in consultation with the Company; provided, however,
that if any of the foregoing shall cease to be a Primary Treasury Dealer, the
Company shall substitute therefor another Primary Treasury Dealer.
"REFERENCE TREASURY DEALER QUOTATIONS" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such redemption date.
Except as set forth above, the Securities will not be redeemable by the
Company prior to maturity and will not be entitled to the benefit of any sinking
fund.
6. NOTICE OF REDEMPTION
Notice of redemption will be mailed at least 30 days but not more than 60
days before the redemption date by first-class mail to each Holder of Securities
to be redeemed at his registered address. Securities in denominations of
principal amount larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000. If money sufficient to pay the redemption price of and
accrued and unpaid interest on all Securities (or portions thereof) to be
redeemed on the redemption date is deposited with the Paying Agent on or before
the redemption date and certain other conditions are satisfied, on and after
such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.
7. DENOMINATIONS; TRANSFER; EXCHANGE
The Securities are in registered form without coupons in denominations of
principal amount of $1,000 and whole multiples of $1,000. A Holder may register
transfer or exchange Securities in accordance with the Indenture. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements or
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange (i)
any Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) for a period
beginning 15 days before a selection of Securities to be redeemed and ending on
the date of such selection or (ii) any Securities for a period beginning 15 days
before an interest payment date and ending on such interest payment date.
8. PERSONS DEEMED OWNERS
The registered holder of this Security may be treated as the owner of it
for all purposes.
9. UNCLAIMED MONEY
If money for the payment of Principal or interest remains unclaimed for two
years after the date of payment of Principal and interest, the Trustee or Paying
Agent shall pay the money back to the Company at its request unless an abandoned
property law designates another Person. After any such payment, Holders entitled
to the money must look only to the Company and not to the Trustee for payment.
10. DEFEASANCE
Subject to certain conditions set forth in the Indenture, the Company at
any time may terminate some or all of its obligations under the Securities and
the Indenture if the Company deposits with the Trustee money or U.S. Government
Obligations for the payment of Principal of and interest on the Securities to
redemption or maturity, as the case may be.
3
62
11. AMENDMENT, WAIVER
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in principal amount of the outstanding Securities and (ii) any
default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount of the outstanding
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Company, the Subsidiary Guarantors and
the Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article 5 of the Indenture,
or to provide for uncertificated Securities in addition to or in place of
certificated Securities, or to add additional guarantees with respect to the
Securities or to add additional security for the Securities, or to add
additional covenants of or surrender rights and powers conferred on the Company,
or to comply with any request of the SEC in connection with qualifying the
Indenture under the Act, or to make any change that does not adversely affect
the rights of any Securityholder or to give effect to the provisions of the
Collateral Documents and the Indenture with regard to the release of all or a
portion of the Collateral in accordance with such provisions.
12. DEFAULTS AND REMEDIES
Under the Indenture, Events of Default include (i) default for 30 days in
payment of interest on the Securities; (ii) default in payment of principal on
the Securities at maturity, upon redemption pursuant to paragraph 5 of the
Securities, upon required repurchase, upon declaration or otherwise; (iii)
failure by the Company or the Subsidiary Guarantors to comply with other
agreements in the Indenture or the Securities, in certain cases subject to
notice and lapse of time; (iv) certain accelerations (including failure to pay
within any grace period after final maturity) of other indebtedness of the
Company, the Subsidiary Guarantors or any of the Company's Subsidiaries if the
amount accelerated (or so unpaid) exceeds $30 million; (v) certain events of
bankruptcy or insolvency with respect to the Company or any Significant
Subsidiary; (vi) certain judgments or decrees for the payment of money in excess
of $30 million against the Company or any Significant Subsidiary; (vii) except
as permitted under the Indenture, a Subsidiary Guarantee ceases to be in full
force and effect for 30 days after notice or a Subsidiary Guarantor denies or
disaffirms its obligations under its Subsidiary Guarantee; or (viii) except as
permitted by the Collateral Documents, the Credit Agreement and the Indenture or
any amendment thereto, any of the Collateral Documents ceases to be in full
force and effect or ceases to be effective, in all material respects, to create
a Lien on the Collateral in favor of the Senior Noteholders for 30 days after
notice.
If an Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in aggregate principal amount of the Securities may declare all
the Securities to be due and payable immediately. Certain events of bankruptcy
or insolvency are Events of Default which will result in the Securities being
due and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default or
Event of Default (except a Default or Event of Default in payment of Principal
or interest) if it determines that withholding notice is not opposed to their
interest.
13. TRUSTEE DEALINGS WITH THE COMPANY
Subject to certain limitations set forth in the Indenture, 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 and collect
obligations owed to it by the Company or its affiliates and may otherwise deal
with the Company or its affiliates with the same rights it would have if it were
not Trustee.
4
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14. NO RECOURSE AGAINST OTHERS
A director, officer, employee or stockholder, as such, of the Company or
the Subsidiary Guarantors shall not have any liability for any obligations of
the Company or the Subsidiary Guarantors under the Securities or the Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. By accepting a Security, each Securityholder waives and releases
all such liability. The waiver and release are part of the consideration for the
issue of the Securities.
15. AUTHENTICATION
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent acting on its behalf) manually signs the
certificate of authentication on the other side of this Security.
16. ABBREVIATIONS
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants
in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
17. CUSIP NUMBERS
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
18. GOVERNING LAW
This Security shall be governed by, and construed in accordance with, the
laws of the State of New York but without giving effect to applicable principles
of conflicts of law to the extent that the application of the laws of another
jurisdiction would be required thereby.
The Company will furnish to any Securityholder upon written request and
without charge to the Securityholder a copy of the Indenture which has in it the
text of this Security in larger type. Requests may be made to: Coltec Industries
Inc., 3 Coliseum Center, 2550 West Tyvola Road, Charlotte, NC 28217 Attention:
Chief Financial Officer.
5
64
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the books
of the Company. The agent may substitute another to act for him.
- --------------------------------------------------------------------------------
Date: Your Signature:
Signature Guarantee: ___________________________________________
(Signature must be guaranteed by a participant in a recognized Signature
Guarantee Medallion Program or other signature guarantor program reasonably
acceptable to the Trustee)
- --------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
65
EXHIBIT H
[FORM OF GUARANTOR SUPPLEMENT]
GUARANTOR SUPPLEMENT, dated as of
-----------------------------
-----------, among Coltec Industries Inc, a Pennsylvania corporation (the
"Company"), [NEW SUBSIDIARY GUARANTOR], a
- ------------------------corporation (the "New Subsidiary Guarantor") and Bankers
Trust Company, a New York banking corporation, as trustee (the "Trustee") to the
Indenture dated as of April 16, 1998 (as amended to the date hereof, the
"Indenture") among the Company, the Subsidiary Guarantors named therein and the
Trustee.
W I T N E S S E T H :
WHEREAS, Section 9.1 of the Indenture provides that the Company and the
Trustee may, among other things, amend the Indenture or the Securities without
notice to or consent of any Securityholder to add Guarantees with respect to the
Securities or to secure the Securities;
WHEREAS, Section 10.7 of the Indenture provides that until such time as all
Guarantees by the Subsidiary Guarantors under the Indenture shall have been
released in accordance with Section 10.9 of the Indenture, the Company shall
cause each Subsidiary that Guarantees the Company's obligations under the Credit
Agreement (other than a Foreign Subsidiary) to execute and deliver this
Guarantor Supplement pursuant to which such Subsidiary shall agree to be bound
by the provisions of Article X of the Indenture; and
WHEREAS, the New Subsidiary Guarantor shall execute and deliver to the
Trustee this Guarantor Supplement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Defined Terms. Capitalized terms used and not defined herein shall
have the meaning specified in or pursuant to the Indenture.
2. Guarantee. The New Subsidiary Guarantor hereby agrees to
unconditionally assume all the obligations of a Subsidiary Guarantor under the
Indenture as described therein.
3. Trustee. The Trustee accepts the modification of the Indenture
effected by this Guarantor Supplement, but only upon the terms and conditions
set forth in the Indenture. Without limiting the generality of the foregoing,
the Trustee assumes no responsibility for the correctness of the recitals herein
contained. The Trustee makes no representation and shall have no responsibility
as to the validity and sufficiency of this Guarantor Supplement.
4. Effect on Indenture. As supplemented by this Guarantor Supplement, the
Indenture is hereby ratified and confirmed in all aspects.
5. Counterparts. This Guarantor Supplement may be executed in
counterparts, each of which when so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.
6. Governing Law. This Guarantor Supplement shall be governed by, and
construed in accordance with, the laws of the State of New York but without
giving effect to applicable principles of conflicts of law to the extent that
the application of the laws of another Jurisdiction would be required thereby.
66
IN WITNESS WHEREOF, the parties hereto have caused this Guarantor
Supplement to be duly executed as of the day and year first above written.
[NEW SUBSIDIARY GUARANTOR]
By:
------------------------------------
Name:
Title:
BANKERS TRUST COMPANY, as Trustee
By:
------------------------------------
Name:
Title:
COLTEC INDUSTRIES INC
By:
------------------------------------
Name:
Title: