EXHIBIT 4.1
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BETTER MINERALS & AGGREGATES COMPANY
13% Senior Subordinated Notes due 2009
__________
INDENTURE
Dated as of October 1, 1999
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THE BANK OF NEW YORK,
as Trustee
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TABLE OF CONTENTS
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ARTICLE 1
Definitions and Incorporation by Reference
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SECTION 1.01. Definitions............................................................ 1
SECTION 1.02. Other Definitions...................................................... 21
SECTION 1.03. Incorporation by Reference of Trust Indenture Act...................... 22
SECTION 1.04. Rules of Construction.................................................. 22
ARTICLE 2
The Securities
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SECTION 2.01. Form and Dating........................................................ 23
SECTION 2.02. Execution and Authentication........................................... 23
SECTION 2.03. Registrar and Paying Agent............................................. 24
SECTION 2.04. Paying Agent to Hold Money in Trust.................................... 25
SECTION 2.05. Holder Lists........................................................... 25
SECTION 2.06. Transfer and Exchange.................................................. 25
SECTION 2.07. Replacement Securities................................................. 26
SECTION 2.08. Outstanding Securities................................................. 27
SECTION 2.09. Temporary Securities................................................... 27
SECTION 2.10. Cancellation........................................................... 27
SECTION 2.11. Defaulted Interest..................................................... 27
SECTION 2.12. CUSIP and "ISIN" Numbers............................................... 28
ARTICLE 3
Redemption
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SECTION 3.01. Notices to Trustee..................................................... 28
SECTION 3.02. Selection of Securities To Be Redeemed................................. 28
SECTION 3.03. Notice of Redemption................................................... 28
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SECTION 3.04. Effect of Notice of Redemption......................................... 29
SECTION 3.05. Deposit of Redemption Price............................................ 29
SECTION 3.06. Securities Redeemed in Part............................................ 30
ARTICLE 4
Covenants
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SECTION 4.01. Payment of Securities.................................................. 30
SECTION 4.02. SEC Reports............................................................ 30
SECTION 4.03. Limitation of Indebtedness............................................. 31
SECTION 4.04. Limitation on Restricted Payments...................................... 34
SECTION 4.05. Limitation on Restrictions on Distributions from
Restricted Subsidiaries.............................................. 37
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock..................... 38
SECTION 4.07. Limitation on Transactions with Affiliates............................. 41
SECTION 4.08. Change of Control...................................................... 42
SECTION 4.09. Compliance Certificate................................................. 44
SECTION 4.10. Further Instruments and Acts........................................... 44
SECTION 4.11. Future Note Guarantors................................................. 44
SECTION 4.12. Limitation on Lines of Business........................................ 44
SECTION 4.13. Limitation on the Sale or Issuance of Capital Stock of
Restricted Subsidiaries.............................................. 44
ARTICLE 5
Successor Company
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SECTION 5.01. When Company May Merge or Transfer Assets.............................. 45
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ARTICLE 6
Defaults and Remedies
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SECTION 6.01. Events of Default...................................................... 46
SECTION 6.02. Acceleration........................................................... 48
SECTION 6.03. Other Remedies......................................................... 49
SECTION 6.04. Waiver of Past Defaults................................................ 49
SECTION 6.05. Control by Majority.................................................... 49
SECTION 6.06. Limitation on Suits.................................................... 50
SECTION 6.07. Rights of Holders to Receive Payment................................... 50
SECTION 6.08. Collection Suit by Trustee............................................. 50
SECTION 6.09. Trustee May File Proofs of Claim....................................... 50
SECTION 6.10. Priorities............................................................. 51
SECTION 6.11. Undertaking for Costs.................................................. 51
SECTION 6.12. Waiver of Stay or Extension Laws....................................... 51
ARTICLE 7
Trustee
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SECTION 7.01. Duties of Trustee...................................................... 52
SECTION 7.02. Rights of Trustee...................................................... 53
SECTION 7.03. Individual Rights of Trustee........................................... 53
SECTION 7.04. Trustee's Disclaimer................................................... 54
SECTION 7.05. Notice of Defaults..................................................... 54
SECTION 7.06. Reports by Trustee to Holders.......................................... 54
SECTION 7.07. Compensation and Indemnity............................................. 54
SECTION 7.08. Replacement of Trustee................................................. 55
SECTION 7.09. Successor Trustee by Merger............................................ 56
SECTION 7.10. Eligibility; Disqualification.......................................... 57
SECTION 7.11. Preferential Collection of Claims Against Company...................... 57
SECTION 7.12. Investment of Funds.................................................... 57
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ARTICLE 8
Discharge of Indenture, Defeasance
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SECTION 8.01. Discharge of Liability on Securities; Defeasance....................... 57
SECTION 8.02. Conditions to Defeasance............................................... 58
SECTION 8.03. Application of Trust Money............................................. 59
SECTION 8.04. Repayment to Company................................................... 59
SECTION 8.05. Indemnity for Government Obligations................................... 60
SECTION 8.06. Reinstatement.......................................................... 60
ARTICLE 9
Amendments
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SECTION 9.01. Without Consent of Holders............................................. 60
SECTION 9.02. With Consent of Holders................................................ 61
SECTION 9.03. Compliance with Trust Indenture Act.................................... 62
SECTION 9.04. Revocation and Effect of Consents and Waivers.......................... 62
SECTION 9.05. Notation on or Exchange of Securities.................................. 63
SECTION 9.06. Trustee to Sign Amendments............................................. 63
ARTICLE 10
Subordination
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SECTION 10.01. Agreement to Subordinate............................................... 63
SECTION 10.02. Liquidation, Dissolution, Bankruptcy................................... 64
SECTION 10.03. Default on Senior Indebtedness......................................... 64
SECTION 10.04. Acceleration of Payment of Securities.................................. 65
SECTION 10.05. When Distribution Must Be Paid Over.................................... 65
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SECTION 10.06. Subrogation............................................................ 65
SECTION 10.07. Relative Rights........................................................ 65
SECTION 10.08. Subrogation May Not Be Impaired by Company............................. 66
SECTION 10.09. Rights of Trustee and Payment Agent.................................... 66
SECTION 10.10. Distribution or Notice to Representative............................... 66
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit Right
to Accelerate........................................................ 66
SECTION 10.12. Trust Monies Not Subordinated.......................................... 66
SECTION 10.13. Trustee Entitled to Rely............................................... 67
SECTION 10.14. Trustee to Effectuate Subordination.................................... 67
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
Indebtedness......................................................... 67
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions............................................. 67
ARTICLE 11
Note Guarantees
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SECTION 11.01. Note Guarantees........................................................ 68
SECTION 11.02. Limitation on Liability................................................ 70
SECTION 11.03. Successors and Assigns................................................. 70
SECTION 11.04. No Waiver.............................................................. 71
SECTION 11.05. Modification........................................................... 71
SECTION 11.06. Execution of Supplemental Indenture for Future Note
Guarantors........................................................... 71
SECTION 11.07. Non-Impairment......................................................... 71
ARTICLE 12
Subordination of the Note Guarantees
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SECTION 12.01. Agreement to Subordinate............................................... 71
SECTION 12.02. Liquidation, Dissolution, Bankruptcy................................... 72
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SECTION 12.03. Default on Designated Senior Indebtedness of a Note
Guarantor............................................................ 72
SECTION 12.04. Demand for Payment..................................................... 73
SECTION 12.05. When Distribution Must Be Paid Over.................................... 73
SECTION 12.06. Subrogation............................................................ 74
SECTION 12.07. Relative Rights........................................................ 74
SECTION 12.08. Subordination May Not Be Impaired by a Note Guarantor.................. 74
SECTION 12.09. Rights of Trustee and Paying Agent..................................... 74
SECTION 12.10. Distribution or Notice to Representative............................... 75
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit Right 75
To Accelerate..............................................
SECTION 12.12. Trustee Entitled to Rely............................................... 75
SECTION 12.13. Trustee To Effectuate Subordination.................................... 75
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior Indebtedness
of a Note Guarantor.................................................. 75
SECTION 12.15. Reliance by Holders of Senior Indebtedness of a Note
Guarantor on Subordination Provisions................................ 76
SECTION 12.16. Defeasance............................................................. 76
ARTICLE 13
Miscellaneous
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SECTION 13.01. Trust Indenture Act Controls........................................... 76
SECTION 13.02. Notices................................................................ 76
SECTION 13.03. Communication by Holders with Other Holders............................ 77
SECTION 13.04. Certificate and Opinion as to Conditions Precedent..................... 77
SECTION 13.05. Statements Required in Certificate or Opinion.......................... 77
SECTION 13.06. When Securities Disregarded............................................ 78
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar........................... 78
SECTION 13.08. Legal Holidays......................................................... 78
SECTION 13.09. GOVERNING LAW.......................................................... 78
SECTION 13.10. No Recourse Against Others............................................. 78
SECTION 13.11. Successors............................................................. 78
SECTION 13.12. Multiple Originals..................................................... 78
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SECTION 13.13. Table of Contents; Headings............................................ 79
Appendix A - Provisions Relating to Initial Securities,
Private Exchange Securities and Exchange Securities
Exhibit A - Form of Initial Security and Private Exchange Security
Exhibit B - Form of Exchange Security
Exhibit C - Form of Supplemental Indenture
Exhibit D - Form of Transferee Letter of Representation
INDENTURE dated as of October 1, 1999, among BETTER MINERALS
& AGGREGATES COMPANY, a Delaware corporation (the "Company"),
U.S. SILICA COMPANY, a Delaware corporation, BETTER MATERIALS
CORPORATION, a Pennsylvania corporation, GEORGE F. PETTINOS,
INC., a Delaware corporation, OTTAWA SILICA COMPANY, a Delaware
corporation, THE FULTON LAND AND TIMBER COMPANY, a Pennsylvania
corporation, PENNSYLVANIA GLASS SAND CORPORATION, a Delaware
corporation, BUCKS COUNTY CRUSHED STONE COMPANY, a Pennsylvania
corporation, CHIPPEWA FARMS CORPORATION, a Pennsylvania
corporation, SHORE STONE COMPANY, INC., a New Jersey corporation,
BMC TRUCKING, INC., a Delaware corporation, ELLEN JAY, INC., a
New Jersey corporation, STONE MATERIALS COMPANY, LLC, a Delaware
limited liability company, COMMERCIAL STONE CO., INC., a
Pennsylvania corporation, COMMERCIAL AGGREGATES TRANSPORTATION
AND SALES, LLC, a Delaware limited liability company
(collectively, the "Note Guarantors") and THE BANK OF NEW YORK, 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 (a) the Company's 13% Senior
Subordinated Notes due 2009 issued on the date hereof (the "Initial
Securities"), (b) if and when issued as provided in the Registration Agreement
(as defined in Appendix A hereto (the "Appendix")), the Company's 13% Senior
Subordinated Notes due 2009 issued in the Registered Exchange Offer in exchange
for any Initial Securities (the "Exchange Securities") and (c) if and when
issued as provided in the Registration Agreement, the Private Exchange
Securities (together with the Initial Securities and any Exchange Securities
issued hereunder, the "Securities") issued in the Private Exchange. Except as
otherwise provided herein, the Securities will be limited to $150,000,000 in
aggregate principal amount outstanding.
ARTICLE 1
Definitions and Incorporation by Reference
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SECTION 1.01. Definitions.
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"Acquisition Term Loan Facility" means the facility referred to as the
Acquisition Facility in the Credit Agreement.
"Additional Assets" means (a) any property or assets (other than
Indebtedness and Capital Stock) to be used by the Company or a Restricted
Subsidiary in a Permitted Business; (b) the Capital Stock of a Person that
becomes a Restricted Subsidiary as a result of the
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acquisition of such Capital Stock by the Company or another Restricted
Subsidiary; or (c) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; provided, however, that any such
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Restricted Subsidiary described in clauses (b) or (c) above is primarily engaged
in a Permitted Business.
"Affiliate" of any specified Person means any other Person, directly
or indirectly, controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing. For
purposes of Sections 4.06 and 4.07 only, "Affiliate" shall also mean any
beneficial owner of shares representing 10% or more of the total voting power of
the Voting Stock (on a fully diluted basis) of Parent, Holdings or the Company
or of rights or warrants to purchase such Voting Stock (whether or not currently
exercisable) and any Person who would be an Affiliate of any such beneficial
owner pursuant to the first sentence hereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or dispositions) by
the Company or any Restricted Subsidiary, including any disposition by means of
a merger, consolidation or similar transaction (each referred to for the
purposes of this definition as a "disposition"), of (a) any shares of Capital
Stock of a Restricted Subsidiary (other than directors' qualifying shares or
shares required by applicable law to be held by a Person other than the Company
or a Restricted Subsidiary), (b) all or substantially all the assets of any
division or line of business of the Company or any Restricted Subsidiary or (c)
any other assets of the Company or any Restricted Subsidiary outside of the
ordinary course of business of the Company or such Restricted Subsidiary other
than, in the case of (a), (b) and (c) above, (i) a disposition by a Restricted
Subsidiary to the Company or by the Company or a Restricted Subsidiary to a
Wholly Owned Subsidiary, (ii) for purposes of Section 4.06 only, a disposition
that constitutes a Restricted Payment permitted by Section 4.04, (iii) a
disposition of assets with a Fair Market Value of less than $500,000 and (iv) a
transfer of real property to a state, county, local or municipal governmental
agency in exchange for the granting of a permit or the taking of other
regulatory action by such governmental agency that enhances the value of mining
properties owned by the Company or a Restricted Subsidiary, provided that the
Board of Directors has determined in good faith that such exchange is in the
best interest of the Company.
"Attributable Debt" in respect of a Sale/Leaseback Transaction means,
as at the time of determination, the present value (discounted at the interest
rate borne by the Securities, compounded annually) of the total obligations of
the lessee for rental payments during the remaining term of the lease included
in such Sale/Leaseback Transaction (including any period for which such lease
has been extended).
"Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (a) the
sum of the products of the numbers of years from the date of determination to
the dates of each successive scheduled
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principal payment of such Indebtedness or scheduled redemption or similar
payment with respect to such Preferred Stock multiplied by the amount of such
payment by (b) the sum of all such payments.
"Bank Indebtedness" means any and all amounts payable under or in
respect of the Credit Agreement and any Refinancing Indebtedness with respect
thereto, as amended from time to time, including principal, premium (if any),
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company whether or not a claim
for post-filing interest is allowed in such proceedings), fees, charges,
expenses, reimbursement obligations, guarantees and all other amounts payable
thereunder or in respect thereof.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of the Board of Directors
of the Company.
"Business Day" means each day which is not a Legal Holiday.
"Capital Stock" of any Person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such Person, including any Preferred
Stock, but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligations" means an obligation that is required
to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease prior to the first date upon which such lease may be prepaid by the lessee
without payment of a penalty.
"Change of Control" means the occurrence of any of the following
events:
(a) prior to the earliest to occur of (i) the first public offering of
common stock of Parent, (ii) the first public offering of common stock of
Holdings or (iii) the first public offering of common stock of the Company
(each, a "Public Market Offering"), the Permitted Holders cease to be the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange
Act), directly or indirectly, of a majority in the aggregate of the total
voting power of the Voting Stock of Parent, Holdings or the Company,
whether as a result of issuance of securities of Parent, Holdings or the
Company, any merger, consolidation, liquidation or dissolution of Parent,
Holdings or the Company, any direct or indirect transfer of securities by
any Permitted Holder or otherwise (for purposes of this clause (a) and
clause (b) below, the Permitted Holders shall be deemed to beneficially own
any Voting Stock of an entity (the "specified entity") held by any other
entity (the "parent entity") so long as the Permitted Holders beneficially
own (as so
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defined), directly or indirectly, in the aggregate a majority of the voting
power of the Voting Stock of the parent entity);
(b) after a Public Market Offering has occurred, (i) any "person" (as
such term is used in Sections 13(d) and 14(d) of the Exchange Act), other
than one or more Permitted Holders, is or becomes the beneficial owner (as
defined in clause (a) above), whether by merger, consolidation, other
business combination or otherwise, directly or indirectly, of more than 35%
of the total voting power of the Voting Stock of the Company, Holdings or
Parent and (ii) the Permitted Holders "beneficially own" (as defined in
clause (a) above), directly or indirectly, in the aggregate a lesser
percentage of the total voting power of the Voting Stock of the Company,
Holdings or Parent than such other person and do not have the right or
ability by voting power, contract or otherwise to elect or designate for
election a majority of the board of directors of the Company, Holdings or
Parent, as the case may be (for the purposes of this clause (b), such other
person shall be deemed to beneficially own any Voting Stock of a specified
entity held by a parent entity, if such other person is the beneficial
owner (as defined in clause (a) above), directly or indirectly, of more
than 35% of the voting power of the Voting Stock of such parent entity and
the Permitted Holders "beneficially own" (as defined in clause (a) above),
directly or indirectly, in the aggregate a lesser percentage of the voting
power of the Voting Stock of such parent entity and do not have the right
or ability by voting power, contract or otherwise to elect or designate for
election a majority of the board of directors of such parent entity);
(c) during any period of two consecutive years, individuals who at the
beginning of such period constituted the board of directors of the Company,
Holdings or Parent, as the case may be (together with any new directors
whose election by such board of directors of the Company, Holdings or
Parent, as the case may be, or whose nomination for election by the
shareholders of the Company, Holdings or Parent, as the case may be, was
approved by a vote of 66-2/3% of the directors of the Company, Holdings or
Parent, as the case may be, then still in office who were either directors
at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the board of directors of the Company, Holdings or Parent, as
the case may be, then in office; or
(d) the adoption of a plan relating to the liquidation or dissolution
of the Company, Holdings or Parent.
"Closing Date" means the date of this Indenture.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commodity Agreement" means any agreement designed to hedge against
fluctuations in commodity prices, including natural gas prices, entered into in
the ordinary course of business.
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"Company" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, solely for
purposes of any provision contained herein and required by the TIA, each other
obligor on the indenture securities.
"Consolidated Coverage Ratio" as of any date of determination means
the ratio of (a) the aggregate amount of EBITDA for the period of the most
recent four consecutive fiscal quarters ending at least 45 days prior to the
date of such determination to (b) Consolidated Interest Expense for such four
fiscal quarters; provided, however, that (i) if the Company or any Restricted
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Subsidiary has Incurred any Indebtedness since the beginning of such period that
remains outstanding on such date of determination or if the transaction giving
rise to the need to calculate the Consolidated Coverage Ratio is an Incurrence
of Indebtedness, EBITDA and Consolidated Interest Expense for such period shall
be calculated after giving effect on a pro forma basis to such Indebtedness as
if such Indebtedness had been Incurred on the first day of such period and the
discharge of any other Indebtedness repaid, repurchased, defeased or otherwise
discharged with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period, (ii) if the Company or any Restricted
Subsidiary has repaid, repurchased, defeased or otherwise discharged any
Indebtedness since the beginning of such period or if any Indebtedness is to be
repaid, repurchased, defeased or otherwise discharged (in each case other than
Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on the date
of the transaction giving rise to the need to calculate the Consolidated
Coverage Ratio, EBITDA and Consolidated Interest Expense for such period shall
be calculated on a pro forma basis as if such discharge had occurred on the
first day of such period and as if the Company or such Restricted Subsidiary has
not earned the interest income actually earned during such period in respect of
cash or Temporary Cash Investments used to repay, repurchase, defease or
otherwise discharge such Indebtedness, (iii) if since the beginning of such
period the Company or any Restricted Subsidiary shall have made any Asset
Disposition, the EBITDA for such period shall be reduced by an amount equal to
the EBITDA (if positive) directly attributable to the assets that are the
subject of such Asset Disposition for such period or increased by an amount
equal to the EBITDA (if negative) directly attributable thereto for such period
and Consolidated Interest Expense for such period shall be reduced by an amount
equal to the Consolidated Interest Expense directly attributable to any
Indebtedness of the Company or any Restricted Subsidiary repaid, repurchased,
defeased or otherwise discharged with respect to the Company and its continuing
Restricted Subsidiaries in connection with such Asset Disposition for such
period (or, if the Capital Stock of any Restricted Subsidiary is sold, the
Consolidated Interest Expense for such period directly attributable to the
Indebtedness of such Restricted Subsidiary to the extent the Company and its
continuing Restricted Subsidiaries are no longer liable for such Indebtedness
after such sale), (iv) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have made an Investment in
any Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary)
or an acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made hereunder, which
constitutes all or substantially all of an operating unit of a business, EBITDA
and Consolidated Interest Expense for such period shall be calculated after
giving pro forma effect thereto (including the Incurrence of any Indebtedness)
as if such Investment or acquisition occurred on the first day of such period
and (v) if since the beginning
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of such period any Person (that subsequently became a Restricted Subsidiary or
was merged with or into the Company or any Restricted Subsidiary since the
beginning of such period) shall have made any Asset Disposition or any
Investment or acquisition of assets that would have required an adjustment
pursuant to clause (iii) or (iv) above if made by the Company or a Restricted
Subsidiary during such period, EBITDA and Consolidated Interest Expense for such
period shall be calculated after giving pro forma effect thereto as if such
Asset Disposition, Investment or acquisition of assets occurred on the first day
of such period. For purposes of this definition, whenever pro forma effect is to
be given to an acquisition of assets or other Investment, the amount of income
or earnings relating thereto and the amount of Consolidated Interest Expense
associated with any Indebtedness Incurred in connection therewith, the pro forma
calculations shall be determined in good faith by a responsible financial or
accounting Officer of the Company and shall comply with the requirements of Rule
11-02 of Regulation S-X promulgated by the SEC. If any Indebtedness bears a
floating rate of interest and is being given pro forma effect, the interest
expense on such Indebtedness shall be calculated as if the rate in effect on the
date of determination had been the applicable rate for the entire period (taking
into account any Interest Rate Agreement applicable to such Indebtedness if such
Interest Rate Agreement has a remaining term as at the date of determination in
excess of 12 months).
"Consolidated Interest Expense" means, for any period, the total
interest expense of the Company and its Consolidated Restricted Subsidiaries,
plus, to the extent Incurred by the Company and its Consolidated Restricted
Subsidiaries in such period but not included in such interest expense, without
duplication (a) interest expense attributable to Capitalized Lease Obligations
and the interest expense attributable to leases constituting part of a
Sale/Leaseback Transaction, (b) amortization of debt discount (but not debt
issuance costs), (c) capitalized interest, (d) noncash interest expense, (e)
commissions, discounts and other fees and charges attributable to letters of
credit and bankers' acceptance financing, (f) interest accruing on any
Indebtedness of any other Person to the extent such Indebtedness is Guaranteed
by the Company or any Restricted Subsidiary; (g) net costs associated with
Hedging Obligations, (h) dividends in respect of all Disqualified Stock of the
Company and all Preferred Stock of any Restricted Subsidiary, to the extent held
by Persons other than the Company or another Restricted Subsidiary, (i) interest
Incurred in connection with investments in discontinued operations and (j) the
cash contributions to any employee stock ownership plan or similar trust to the
extent such contributions are used by such plan or trust to pay interest or fees
to any Person (other than the Company) in connection with Indebtedness Incurred
by such plan or trust.
"Consolidated Leverage Ratio" as of any date of determination means
the ratio of:
(a) Indebtedness of the Company and its Consolidated Restricted
Subsidiaries as of the end of the most recent fiscal quarter ending at
least 45 days prior to the date of such determination;
(b) the aggregate amount of EBITDA for the period of the most recent
four consecutive fiscal quarters ending at least 45 days prior to the date
of such determination; provided, however, that:
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(i) if the Company or any Restricted Subsidiary has incurred
any Indebtedness since the beginning of such period that remains
outstanding on such date of determination, Indebtedness and EBITDA for
such period shall be calculated after giving effect on a pro forma
basis to such Indebtedness as if such Indebtedness had been Incurred
on the first day of such period and the discharge of any other
Indebtedness repaid, repurchased, defeased or otherwise discharged
with the proceeds of such new Indebtedness as if such discharge had
occurred on the first day of such period,
(ii) if the Company or any Restricted Subsidiary has repaid,
repurchased, defeased or otherwise discharged any Indebtedness since
the beginning of such period or if any Indebtedness is to be repaid,
repurchased, defeased or otherwise discharged (in each case other than
Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on
the date of the transaction giving rise to the need to calculate the
Consolidated Leverage Ratio, Indebtedness and EBITDA for such period
shall be calculated on a pro forma basis as if such discharge had
occurred on the first day of such period and as if the Company or such
Restricted Subsidiary has not earned the interest income actually
earned during such period in respect of cash or Temporary Cash
Investments used to repay, repurchase, defease or otherwise discharge
such Indebtedness,
(iii) if since the beginning of such period the Company or any
Restricted Subsidiary shall have made any Asset Disposition, the
EBITDA for such period shall be reduced by an amount equal to the
EBITDA (if positive) directly attributable to the assets that are the
subject of such Asset Disposition for such period or increased by an
amount equal to the EBITDA (if negative) directly attributable thereto
for such period and Indebtedness shall be reduced by any Indebtedness
of the Company or any Restricted Subsidiary repaid, repurchased,
defeased or otherwise discharged with respect to the Company and its
continuing Restricted Subsidiary is sold, the Indebtedness of such
Restricted Subsidiary to the extent the Company and its continuing
Restricted Subsidiaries are no longer liable for such Indebtedness
after such sale),
(iv) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Restricted Subsidiary (or any Person that becomes a
Restricted Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction
causing a calculation to be made hereunder, which constitutes all or
substantially all of an operating unit of a business, Indebtedness and
EBITDA for such period shall be calculated after giving pro forma
effect thereto (including the Incurrence of any Indebtedness) as if
such Investment or acquisition occurred on the first day of such
period, and
8
(v) if since the beginning of such period any Person (that
subsequently became a Restricted Subsidiary or was merged with or into
the Company or any Restricted Subsidiary since the beginning of such
period) shall have made any Asset Disposition or any Investment or
acquisition of assets that would have required an adjustment pursuant
to clause (iii) or (iv) above if made by the Company or a Restricted
Subsidiary during such period, Indebtedness and EBITDA for such period
shall be calculated after giving pro forma effect thereto as if such
Asset Disposition, Investment or acquisition of assets occurred on the
first day of such period.
For purposes of this definition, whenever pro forma effect is to be
given to an acquisition of assets or other Investment, the amount of income or
earnings relating thereto and the amount of any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be determined in good
faith by a responsible financial or accounting Officer of the Company and shall
comply with the requirements of Rule 11-02 or Regulation S-X promulgated by the
SEC.
If any Indebtedness bears a floating rate of interest and is being
given to pro forma effect, the interest expense on such Indebtedness shall be
calculated as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement applicable to such Indebtedness if such Interest Rate Agreement has a
remaining term as at the date of determination in excess of 12 months).
"Consolidated Net Income" means, for any period, the net income of the
Company and its Consolidated Subsidiaries for such period; provided, however,
-------- -------
that there shall not be included in such Consolidated Net Income:
(a) any net income of any Person (other than the Company) if such
Person is not a Restricted Subsidiary, except that (i) subject to the
limitations contained in clause (d) below, the Company's equity in the net
income of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Company or a
Restricted Subsidiary as a dividend or other distribution (subject, in the
case of a dividend or other distribution made to a Restricted Subsidiary,
to the limitations contained in clause (c) below) and (ii) the Company's
equity in a net loss of any such Person for such period shall be included
in determining such Consolidated Net Income;
(b) any net income (or loss) of any Person acquired by the Company or
a Subsidiary in a pooling of interests transaction for any period prior to
the date of such acquisition;
(c) any net income (or loss) of any Restricted Subsidiary to the
extent such Restricted Subsidiary is subject to restrictions, directly or
indirectly, on the payment of dividends or the making of distributions by
such Restricted Subsidiary, directly or indirectly, to the Company, except
that the Company's equity in a net loss of any such
9
Restricted Subsidiary for such period shall be included in determining such
Consolidated Net Income;
(d) any gain or loss realized upon the sale or other disposition of
any asset of the Company or its Consolidated Subsidiaries (including
pursuant to any Sale/Leaseback Transaction) that is not sold or otherwise
disposed of in the ordinary course of business and any gain or loss
realized upon the sale or other disposition of any Capital Stock of any
Person;
(e) any extraordinary gain or loss; and
(f) the cumulative effect of a change in accounting principles.
Notwithstanding the foregoing, for the purpose of Section 4.04 only, there shall
be excluded from Consolidated Net Income any dividends, repayments of loans or
advances or other transfers of assets from Unrestricted Subsidiaries to the
Company or a Restricted Subsidiary to the extent such dividends, repayments or
transfers increase the amount of Restricted Payments permitted under such
Section pursuant to clause (a) (iv)(3)(D) thereof.
"Consolidation" means the consolidation of the amounts of each of the
Restricted Subsidiaries with those of the Company in accordance with GAAP
consistently applied; provided, however, that "Consolidation" shall not include
-------- -------
consolidation of the accounts of any Unrestricted Subsidiary, but the interest
of the Company or any Restricted Subsidiary in an Unrestricted Subsidiary shall
be accounted for as an investment. The term "Consolidated" has a correlative
meaning.
"Credit Agreement" means the credit agreement dated as of the
Closing Date among the Company, as borrower, Parent, as parent guarantor, George
F. Pettinos (Canada) Limited, as Canadian borrower, Banque Nationale de Paris,
as agent, and the financial institutions and other institutional lenders named
therein, as the same may be amended, restated, supplemented, waived, replaced,
refinanced, restructured or otherwise modified from time to time, in each case,
whether or not upon termination, whether with the original financial
institutions, other institutional lenders or agents, and whether with one or
more credit agreements with the Company or one or more Restricted Subsidiaries
as borrowers.
"Currency Agreement" means with respect to any Person any foreign
exchange contract, currency swap agreements or other similar agreement or
arrangement to which such Person is a party or of which it is a beneficiary.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Designated Senior Indebtedness" of the Company means (a) the Bank
Indebtedness and Indebtedness in respect of Hedging Obligations, and (b) any
other Senior Indebtedness of the Company that, at the date of determination, has
an aggregate principal
10
amount outstanding of, or under which, at the date of determination, the holders
thereof are committed to lend up to at least $25.0 million and is specifically
designated by the Company in the instrument evidencing or governing such Senior
Indebtedness as "Designated Senior Indebtedness" for purposes of this Indenture.
"Designated Senior Indebtedness" of a Note Guarantor has a correlative meaning.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable or exercisable) or upon the
happening of any event (a) matures or is mandatorily redeemable pursuant to a
sinking fund obligation or otherwise, (b) is convertible or exchangeable for
Indebtedness or Disqualified Stock (excluding Capital Stock convertible or
exchangeable solely at the option of the Company or a Restricted Subsidiary;
provided, however, that any such conversion or exchange shall be deemed an
- -------- -------
Incurrence of Indebtedness or Disqualified Stock, as applicable) or (c) is
redeemable at the option of the holder thereof, in whole or in part, in the case
of each of clauses (a), (b) and (c), on or prior to the first anniversary of the
Stated Maturity of the Securities; provided, however, that any Capital Stock
-------- -------
that would not constitute Disqualified Stock but for provisions thereof giving
holders thereof the right to require such Person to repurchase or redeem such
Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the Stated Maturity of the Securities shall not constitute
Disqualified Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are not more favorable in a material respect to
the holders of such Capital Stock than the provisions of Sections 4.06 and 4.08.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
other than a Foreign Subsidiary.
"EBITDA" for any period means the Consolidated Net Income for such
period, plus, without duplication, the following to the extent deducted in
calculating such Consolidated Net Income: (a) income tax expense of the Company
and its Consolidated Restricted Subsidiaries, (b) Consolidated Interest Expense,
(c) depreciation expense of the Company and its Consolidated Restricted
Subsidiaries, (d) amortization expense of the Company and its Consolidated
Restricted Subsidiaries (excluding amortization expense attributable to a
prepaid cash item that was paid in a prior period), (e) depletion expense of the
Company and its Consolidated Restricted Subsidiaries, and (f) all other noncash
charges of the Company and its Consolidated Restricted Subsidiaries (excluding
any such noncash charge to the extent it represents an accrual of or reserve for
cash expenditures in any future period) less all non-cash items of income of the
Company and its Restricted Subsidiaries, in each case for such period.
Notwithstanding the foregoing, the provision for taxes based on the income or
profits of, and the depreciation, amortization and depletion and noncash charges
of, a Restricted Subsidiary of the Company shall be added to Consolidated Net
Income to compute EBITDA only to the extent (and in the same proportion) that
the net income of such Restricted Subsidiary was included in calculating
Consolidated Net Income and only if a corresponding amount would be permitted at
the date of determination to be dividended to the Company by such Restricted
Subsidiary without prior approval (that has not been obtained), pursuant to the
terms of its charter and all
11
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to such Restricted Subsidiary or its
stockholders.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, with respect to any asset or property, the
price which could be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction. For purposes of
this Indenture, Fair Market Value will be determined in good faith by the Board
of Directors, whose determination will be conclusive and evidenced by a
resolution of the Board of Directors.
"Foreign Subsidiary" means any Restricted Subsidiary of the Company
that is not organized under the laws of the United States of America or any
State thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Closing Date, including those set forth
in (a) the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (b) statements and
pronouncements of the Financial Accounting Standards Board, (c) such other
statements by such other entities as approved by a significant segment of the
accounting profession, and (d) 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. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness or other obligation
of any other Person and any obligation, direct or indirect, contingent or
otherwise, of such Person (a) to purchase or pay (or advance or supply funds for
the purchase or payment of) such Indebtedness or other obligation of such other
Person (whether arising by virtue of partnership arrangements, or by agreement
to keep-well, to purchase assets, goods, securities or services, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (b) entered into
for purposes of assuring in any other manner the obligee of such Indebtedness or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided, however, that the term
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"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. The term "Guarantor" shall mean any Person Guaranteeing
any obligation.
"Hedging Obligations" of any Person means the obligations of such
Person pursuant to any Interest Rate Agreement, Currency Agreement or Commodity
Agreement.
12
"Holder" means the Person in whose name a Security is registered on
the Registrar's books.
"Holdings" means USS Holdings, Inc., a Delaware corporation, until a
successor replaces it, and, thereafter, means the successor.
"Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or redemption, repayment or
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repurchase obligation in respect of Preferred Stock or Disqualified Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such
Person at the time it becomes a Subsidiary. The term "Incurrence" when used as
a noun shall have a correlative meaning. The accretion of principal of a non-
interest bearing or other discount security shall not be deemed the Incurrence
of Indebtedness.
"Indebtedness" means, with respect to any Person on any date of
determination, without duplication:
(a) the principal of and premium (if any) in respect of indebtedness
of such Person for borrowed money;
(b) the principal of and premium (if any) in respect of obligations of
such Person evidenced by bonds, debentures, notes or other similar
instruments;
(c) all obligations of such Person in respect of letters of credit or
other similar instruments (including reimbursement obligations with respect
thereto);
(d) all obligations of such Person to pay the deferred and unpaid
purchase price of property or services (except Trade Payables), which
purchase price is due more than twelve months after the date of placing
such property in service or taking delivery and title thereto or the
completion of such services;
(e) all Capitalized Lease Obligations and all Attributable Debt of
such Person;
(f) the amount of all obligations of such Person with respect to the
redemption, repayment or other repurchase of any Disqualified Stock or,
with respect to any Subsidiary of such Person, any Preferred Stock (but
excluding, in each case, any accrued dividends);
(g) all Indebtedness of other Persons secured by a Lien on any asset
of such Person, whether or not such Indebtedness is assumed by such Person;
provided, however, that the amount of Indebtedness of such Person shall be
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the lesser of (i) the Fair Market Value of such asset at such date of
determination and (ii) the amount of such Indebtedness of such other
Persons;
13
(h) Hedging Obligations of such Person; and
(i) all obligations of the type referred to in clauses (a) through (h)
of other Persons and all dividends of other Persons for the payment of
which, in either case, such Person is responsible or liable, directly or
indirectly, as obligor, guarantor or otherwise, including by means of any
Guarantee.
The amount of Indebtedness (other than Hedging Obligations) of any Person at any
date shall be the outstanding balance at such date of all unconditional
obligations as described above and the maximum liability, upon the occurrence of
the contingency giving rise to the obligation, of any contingent obligations at
such date. The amount of Indebtedness in respect of Hedging Obligations shall
be determined in accordance with GAAP.
Notwithstanding the foregoing, for the purposes of the definition of
Consolidated Leverage Ratio, Indebtedness shall not include any obligations in
respect of undrawn letters of credit or any Hedging Obligations.
"Indenture" means this Indenture as amended or supplemented from time
to time.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement as to which such Person is party or a
beneficiary.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of the lender) or other
extension of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary" and Section 4.04, (a) "Investment" shall include the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the Fair Market Value of the net assets of any Subsidiary of the Company at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
--------
however, that upon a redesignation of such Subsidiary as a Restricted
- -------
Subsidiary, the Company shall be deemed to continue to have a permanent
"Investment" in an Unrestricted Subsidiary in an amount (if positive) equal to
(i) the Company's "Investment" in such Subsidiary at the time of such
redesignation less (ii) the portion (proportionate to the Company's equity
interest in such Subsidiary) of the Fair Market Value of the net assets of such
Subsidiary at the time of such redesignation; and (b) any property transferred
to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value
at the time of such transfer.
"Issue Date" means the date on which the Initial Securities are
originally issued.
14
"Lien" means any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind (including any conditional sale or other title
retention agreement or lease in the nature thereof).
"liquidated damages" means any liquidated damages payable under the
Registration Agreement.
"Net Available Cash" from an Asset Disposition means cash payments
received (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or otherwise and proceeds
from the sale or other disposition of any securities received as consideration,
but only as and when received, but excluding any other consideration received in
the form of assumption by the acquiring Person of Indebtedness or other
obligations relating to the properties or assets that are the subject of such
Asset Disposition or received in any other non-cash form) therefrom, in each
case net of (a) all legal, title and recording tax expenses, commissions and
other fees and expenses incurred, and all Federal, state, provincial, foreign
and local taxes required to be paid or accrued as a liability under GAAP, as a
consequence of such Asset Disposition, (b) all payments made on any Indebtedness
which is secured by any assets subject to such Asset Disposition, in accordance
with the terms of any Lien upon or other security agreement of any kind with
respect to such assets, or which must by its terms, or in order to obtain a
necessary consent to such Asset Disposition, or by applicable law be repaid out
of the proceeds from such Asset Disposition, (c) all distributions and other
payments required to be made to minority interest holders in Subsidiaries or
joint ventures as a result of such Asset Disposition and (d) appropriate amounts
to be provided by the seller as a reserve, in accordance with GAAP, against any
liabilities associated with the property or other assets disposed of in such
Asset Disposition and retained by the Company or any Restricted Subsidiary after
such Asset Disposition.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Note Guarantee" means each Guarantee of the obligations with respect
to the Securities issued by a Person pursuant to the terms of this Indenture.
"Note Guarantor" means any Person that has issued a Note Guarantee.
"Offering Memorandum" means the Offering Memorandum dated September
28, 1999 for the Company's 13% Senior Subordinated Notes due 2009.
"Officer" means the Chairman of the Board, the Chief Executive
Officer, the Chief Financial Officer, the President, any Vice President, the
Treasurer or the Secretary of the Company. "Officer" of a Note Guarantor has a
correlative meaning.
15
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel. The
counsel may be an employee of or counsel to the Company or a Note Guarantor.
"Parent" means BMAC Holdings, Inc., a Delaware corporation, until a
successor replaces it and, thereafter, means the successor.
"Permitted Asset Swap" means any one or more transactions in which
the Company or any Restricted Subsidiary exchanges assets for consideration
consisting of (a) Capital Stock in or assets of a Person engaged in a Permitted
Business and (b) any cash, provided that such cash will be considered Net
Available Cash from an Asset Disposition.
"Permitted Business" means any business engaged in by the Company or
any Restricted Subsidiary on the Closing Date and any Related Business.
"Permitted Holders" means (a) Chase Capital Partners, its Affiliates
and their respective directors and officers, (b) D. George Harris & Associates,
LLC ("DGHA") and individuals who are equity owners, directors or employees of
DGHA, the Company, Holdings or Parent (or the estate or any beneficiary of any
such individual or any immediate family member of any such individual or any
trust established for the benefit of any such immediate family member) and (c)
any Person acting in the capacity of an underwriter in connection with a public
or private offering of the Company's, Parent's or Holdings' Capital Stock.
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (a) the Company, a Restricted Subsidiary or a Person
that will, upon the making of such Investment, become a Restricted Subsidiary;
provided, however, that the primary business of such Restricted Subsidiary is a
- -------- -------
Permitted Business; (b) another Person if as a result of such Investment such
other Person is merged or consolidated with or into, or transfers or conveys all
or substantially all its assets to, the Company or a Restricted Subsidiary;
provided, however, that such Person's primary business is a Permitted Business;
- -------- -------
(c) Temporary Cash Investments; (d) receivables owing to the Company or any
Restricted Subsidiary if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms; provided,
--------
however, that such trade terms may include such concessionary trade terms as the
- -------
Company or any such Restricted Subsidiary deems reasonable under the
circumstances; (e) payroll, travel and similar advances to cover matters that
are expected at the time of such advances ultimately to be treated as expenses
for accounting purposes and that are made in the ordinary course of business;
(f) loans or advances to employees made in the ordinary course of business
consistent with past practices of the Company or such Restricted Subsidiary and
not exceeding $1.0 million in the aggregate outstanding at any one time; (g)
stock, obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted
Subsidiary or in satisfaction of judgments; (h) any Person to the extent such
Investment represents the non-cash portion of the consideration received for an
Asset Disposition that was made pursuant to and in compliance with Section 4.06;
(i) Investments the payment for which consists of (A) Capital Stock (other than
Disqualified Stock) or the cash
16
proceeds from the sale of Capital Stock (other than Disqualified Stock), in each
case of the Company or (B) the proceeds of cash capital contributions to the
Company; provided, however, that such cash proceeds from sales of Capital Stock
-------- -------
or cash capital contributions will not increase the amount available for
Restricted Payments under Section 4.04(a)(iv)(3); (j) Loans to DGHA pursuant to
the Amended and Restated Management Services Agreement, dated October 6, 1998 or
any amendment or replacement thereto so long as any such amendment or
replacement agreement is not more disadvantageous to the Holders of the Notes in
any material respect than the agreement as in effect as of the Closing Date; (k)
Investments in the ordinary course of business in an insurer required as a
condition to the provision by such insurer of insurance coverage; and (l) any
Person having an aggregate Fair Market Value, taken together with all other
Investments made pursuant to this clause (l) that are at the time outstanding,
not to exceed the greater of 3.0% of Total Assets or $15.0 million at the time
of such Investment (with the Fair Market Value of each Investment being measured
at the time made and without giving effect to subsequent changes in value).
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) that is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.
"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.
"Public Equity Offering" means an underwritten primary public offering
of common stock of the Company, Parent or Holdings, as applicable, pursuant to
an effective registration statement under the Securities Act.
"Public Market" means any time after (a) a Public Equity Offering has
been consummated and (b) at least 15% of the total issued and outstanding common
stock of the Company, Parent or Holdings (as applicable) has been distributed by
means of an effective registration statement under the Securities Act.
"Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that is Incurred to
refund, refinance, replace, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) any Indebtedness of the Company or any
Restricted Subsidiary existing on the Closing Date or Incurred in compliance
with this Indenture (including Indebtedness of the
17
Company or any Restricted Subsidiary that Refinances Refinancing Indebtedness);
provided, however, that (a) the Refinancing Indebtedness has a Stated Maturity
- -------- -------
no earlier than the Stated Maturity of the Indebtedness being Refinanced, (b)
the Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of
the Indebtedness being refinanced, (c) such Refinancing Indebtedness is Incurred
in an aggregate principal amount (or if issued with original issue discount, an
aggregate issue price) that is equal to or less than the aggregate principal
amount (or if issued with original issue discount, the aggregate accreted value)
then outstanding of the Indebtedness being Refinanced plus any reasonable
premiums required to be paid with respect to the Indebtedness being Refinanced,
and (d) if the Indebtedness being Refinanced is subordinated in right of payment
to the Securities, such Refinancing Indebtedness is subordinated in right of
payment to the Securities at least to the same extent as the Indebtedness being
Refinanced; provided further, however, that (x) Refinancing Indebtedness shall
-------- ------- -------
not include (i) Indebtedness of a Restricted Subsidiary that is not a Note
Guarantor that Refinances Indebtedness of the Company or (ii) Indebtedness of
the Company or a Restricted Subsidiary that Refinances Indebtedness of an
Unrestricted Subsidiary and (y) Refinancing Indebtedness referred to in the
definition of "Bank Indebtedness" or in respect of the Acquisition Term Loan
Facility shall not be subject to clauses (a), (b) or (c) of this definition.
"Related Business" means any business related, ancillary or
complementary to the businesses of the Company and the Restricted Subsidiaries
on the Closing Date.
"Representative" means the trustee, agent or representative (if any)
for an issue of Senior Indebtedness.
"Responsible Officer" shall mean, when used with respect to the
Trustee, any officer within the corporate trust department of the Trustee,
including any vice president, assistant vice president, assistant secretary,
assistant treasurer, trust officer or any other officer of the Trustee who
customarily performs functions similar to those performed by the Persons who at
the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person's knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of this Indenture.
"Restricted Subsidiary" means any Subsidiary of the Company other than
an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means an arrangement relating to property
now owned or hereafter acquired by the Company or a Restricted Subsidiary
whereby the Company or a Restricted Subsidiary transfers such property to a
Person and the Company or such Restricted Subsidiary leases it from such Person,
other than leases between the Company and a Wholly Owned Subsidiary or between
Wholly Owned Subsidiaries.
"SEC" means the Securities and Exchange Commission.
18
"Secured Indebtedness" means any Indebtedness of the Company secured
by a Lien. "Secured Indebtedness" of a Note Guarantor has a correlative
meaning.
"Securities" means the Securities issued under this Indenture.
"Securities Act" means the Securities Act of 1933.
"Senior Indebtedness" of the Company or any Note Guarantor means the
principal of, premium (if any) and accrued and unpaid interest on (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization of the Company or any Note Guarantor, regardless of whether or
not a claim for post-filing interest is allowed in such proceedings) and fees
and other amounts owing in respect of, Bank Indebtedness and all other
Indebtedness of the Company or any Note Guarantor, as applicable, whether
outstanding on the Closing Date or thereafter Incurred, unless in the instrument
creating or evidencing the same or pursuant to which the same is outstanding it
is provided that such obligations are not superior in right of payment to the
Securities or such Note Guarantor's Note Guarantee; provided, however, that
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Senior Indebtedness of the Company or any Note Guarantor shall not include (a)
any obligation of the Company to Parent, Holdings or any Subsidiary of the
Company or of such Note Guarantor to Parent, Holdings or the Company or any
other Subsidiary of the Company, (b) any liability for Federal, state, local or
other taxes owed or owing by the Company or such Note Guarantor, as applicable,
(c) any accounts payable or other liability to trade creditors arising in the
ordinary course of business (including Guarantees thereof or instruments
evidencing such liabilities but excluding liabilities of the Company or a Note
Guarantor, as applicable, with respect to performance or surety bonds or similar
obligations, in each case entered into in the ordinary course of business), as
applicable, (d) any Indebtedness or obligation of the Company or such Note
Guarantor (and any accrued and unpaid interest in respect thereof) that by its
terms is subordinate or junior in right of payment to any other Indebtedness or
obligation of the Company or such Note Guarantor, as applicable, including any
Senior Subordinated Indebtedness and any Subordinated Obligations of the Company
or such Note Guarantor, as applicable, (e) any obligations with respect to any
Capital Stock or (f) any Indebtedness Incurred in violation of this Indenture.
"Senior Subordinated Indebtedness" of the Company means the Securities
and any other Indebtedness of the Company that specifically provides that such
Indebtedness is to rank equally with the Securities in right of payment and is
not subordinated by its terms in right of payment to any Indebtedness or other
obligation of the Company which is not Senior Indebtedness. "Senior Subordinated
Indebtedness" of a Note Guarantor has a correlative meaning.
"Significant Subsidiary" means any Restricted 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 final payment of
principal of such security is due and
19
payable, including pursuant to any mandatory redemption provision (but excluding
any provision providing for the repurchase of such security at the option of the
holder thereof upon the happening of any contingency beyond the control of the
issuer unless such contingency has occurred).
"Subordinated Obligation" means any Indebtedness of the Company
(whether outstanding on the Closing Date or thereafter Incurred) that is
subordinate or junior in right of payment to the Securities pursuant to a
written agreement. "Subordinated Obligation" of a Note Guarantor has a
correlative meaning.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital Stock or other interests (including partnership
interests) entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by (a) such Person, (b) such Person
and one or more Subsidiaries of such Person or (c) one or more Subsidiaries of
such Person.
"Temporary Cash Investments" means any of the following: (a) any
investment in direct obligations of the United States of America or any agency
thereof or obligations Guaranteed by the United States of America or any agency
thereof, (b) investments in time deposit accounts, certificates of deposit and
money market deposits maturing within 180 days of the date of acquisition
thereof issued by a bank or trust company that is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States of America having capital, surplus and undivided
profits aggregating in excess of $250,000,000 (or the foreign currency
equivalent thereof) and whose long-term debt is rated "A" (or such similar
equivalent rating) or higher by at least one nationally recognized statistical
rating organization (as defined in Rule 436 under the Securities Act), (c)
repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clause (a) above entered into with a bank
meeting the qualifications described in clause (b) above, (d) investments in
commercial paper, maturing not more than 90 days after the date of acquisition,
issued by a corporation (other than an Affiliate of the Company) organized and
in existence under the laws of the United States of America or any foreign
country recognized by the United States of America with a rating at the time as
of which any investment therein is made of "P-1" (or higher) according to
Moody's Investors Service, Inc. or "A-1" (or higher) according to Standard and
Poor's Ratings Service, a division of The McGraw-Hill Companies, Inc. ("S&P"),
and (e) investments in securities with maturities of six months or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least "A" by S&P or "A" by Moody's
Investors Service, Inc.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. " 77aaa-
------
77bbbb) as in effect on the Closing Date.
"Total Assets" means the total consolidated assets of the Company
and its Restricted Subsidiaries, as shown on the most recent balance sheet of
the Company.
20
"Trade Payables" means, with respect to any Person, any accounts
payable or any indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person arising in the ordinary course of business
in connection with the acquisition of goods or services.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.
"Uniform Commercial Code" means the New York Uniform Commercial Code
as in effect from time to time.
"Unrestricted Subsidiary" means (a) any Subsidiary of the Company that
at the time of determination shall be designated an Unrestricted Subsidiary by
the Board of Directors in the manner provided below and (b) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary of
the Company (including any newly acquired or newly formed Subsidiary of the
Company) to be an Unrestricted Subsidiary unless such Subsidiary or any of its
Subsidiaries owns any Capital Stock or Indebtedness of, or owns or holds any
Lien on any property of, the Company or any Restricted Subsidiary of the Company
that is not a Subsidiary of the Subsidiary to be so designated; provided,
--------
however, that either (i) the Subsidiary to be so designated has total
- -------
Consolidated assets of $1,000 or less or (ii) if such Subsidiary has
Consolidated assets greater than $1,000, then such designation would be
permitted under Section 4.04. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that
-------- -------
(a) immediately after giving effect to such designation no Default shall have
occurred and be continuing and (b) at the time of such designation, the Company
or a Restricted Subsidiary could have Incurred all of the outstanding
Indebtedness of such Subsidiary and its Subsidiaries under Section 4.03. Any
such designation of a Subsidiary as a Restricted Subsidiary or Unrestricted
Subsidiary by the Board of Directors shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the resolution of the Board of
Directors giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"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.
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
21
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the Company
all the Voting Stock of which (other than directors' qualifying shares) is owned
by the Company and/or another Wholly Owned Subsidiary.
SECTION 1.02. Other Definitions.
------------------
Defined in
Term Section
- ---- ----------
"Affiliate Transaction"................................................ 4.07(a)
"Appendix"............................................................. Preamble
"Bankruptcy Law"....................................................... 6.01
"beneficially own"..................................................... 1.01
"Blockage Notice"...................................................... 10.03
"Change of Control Offer".............................................. 4.08(b)
"covenant defeasance option"........................................... 8.01(b)
"Custodian"............................................................ 6.01
"Definitive Securities"................................................ Appendix A
"Event of Default"..................................................... 6.01
"Exchange Securities".................................................. Preamble
"Global Securities".................................................... Appendix A
"Guarantee Blockage Notice"............................................ 12.03
"Guaranteed Obligations"............................................... 11.01
"Guaranteed Payment Blockage Period"................................... 12.03
"incorporated provision"............................................... 13.01
"Initial Securities"................................................... Preamble
"legal defeasance option".............................................. 8.01(b)
"Legal Holiday"........................................................ 13.08
"Notice of Default".................................................... 6.01
"Offer"................................................................ 4.06(b)
"Offer Amount"......................................................... 4.06(c)(ii)
"Offer Period"......................................................... 4.06(c)(ii)
"pay its Guarantee".................................................... 12.03
"pay the Securities"................................................... 10.03
"Paying Agent"......................................................... 2.03
"Payment Blockage Period".............................................. 10.03
"Private Exchange Securities".......................................... Appendix A
"protected purchaser".................................................. 2.07
"Purchase Date"........................................................ 4.06(c)(i)
"Registered Exchange Offer"............................................ Appendix A
"Registrar"............................................................ 2.03
"Restricted Payment"................................................... 4.04(a)
"Successor Company".................................................... 5.01(a)
22
SECTION 1.03. 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 and the Note Guarantees.
"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 Note
Guarantors and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.04. Rules of Construction. Unless the context otherwise
----------------------
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(c) "or" is not exclusive;
(d) "including" means including without limitation;
(e) words in the singular include the plural and words in the plural
include the singular;
(f) unsecured Indebtedness shall not be deemed to be subordinate or
junior to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(g) the principal amount of any non interest 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; and
23
(h) the principal amount of any Preferred Stock shall be (i) the
maximum liquidation value of such Preferred Stock or (ii) the maximum
mandatory redemption or mandatory repurchase price with respect to such
Preferred Stock, whichever is greater.
ARTICLE 2
The Securities
--------------
SECTION 2.01. Form and Dating. Provisions relating to the Initial
---------------
Securities, the Private Exchange Securities and the Exchange Securities are set
forth in the Appendix, which is hereby incorporated in and expressly made a part
of this Indenture. The (a) Initial Securities and the Trustee's certificate of
authentication and (b) Private Exchange Securities and the Trustee's certificate
of authentication shall each be substantially in the form of Exhibit A hereto,
which is hereby incorporated in and expressly made a part of this Indenture.
The Exchange Securities and the Trustee's certificate of authentication shall
each be substantially in the form of Exhibit B hereto, which is hereby
incorporated in and expressly made a part of this Indenture. The Securities may
have notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Company or any Note Guarantor is subject, if any, or
usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Company). Each Security shall be dated the date of its
authentication. The Securities shall be issuable only in registered form
without interest coupons and only in denominations of $1,000 and integral
multiples thereof.
SECTION 2.02. Execution and Authentication. One Officer shall sign
-----------------------------
the Securities for the Company by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate and make available for delivery
Securities as set forth in the Appendix.
In authenticating the Securities and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and shall be fully protected in relying
upon:
(a) A copy of the resolution or resolutions of the Board of Directors
in or pursuant to which the terms and form of the Securities were established,
certified by the secretary or an assistant secretary of the Company to have been
duly adopted by the Board of Directors and to be in full force and effect as of
the date of such certificate, and if the terms and form of such
24
Securities are established by an Officers' Certificate pursuant to general
authorization of the Board of Directors, such Officers' Certificate;
(b) an Opinion of Counsel which shall state:
(i) that the form of such Securities has been established by or
pursuant to a resolution of the Board of Directors in conformity with the
provisions of this Indenture;
(ii) that the terms of such Securities have been established in
conformity with the other provisions of this Indenture;
(iii) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting the enforcement of
creditors' rights and to general equity principles.
The Trustee shall have the right to decline to authenticate and
deliver any Securities under this Section 2.02 if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if the Trustee
in good faith shall determine that such action would expose the Trustee to
personal liability to existing Holders.
The Trustee may appoint an authenticating agent reasonably acceptable
to the Company to authenticate the Securities. Any such appointment shall be
evidenced by an instrument signed by a Responsible Officer, a copy of which
shall be furnished to the Company. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as any Registrar, Paying Agent or agent for service of notices and
demands.
SECTION 2.03. Registrar and Paying Agent. (a) 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 additional paying agent, and the
term "Registrar" includes any co-registrars. The Company initially appoints the
Trustee as (i) Registrar and Paying Agent in connection with the Securities and
(ii) the Securities Custodian with respect to the Global Securities.
(b) The Company shall enter into an appropriate agency agreement with
any Registrar or Paying Agent 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 any such agent. If the
25
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 7.07. The Company or any of its domestically organized Wholly Owned
Subsidiaries may act as Paying Agent or Registrar.
(c) The Company may remove any Registrar or Paying Agent upon written
notice to such Registrar or Paying Agent and to the Trustee; provided, however,
-------- -------
that no such removal shall become effective until (i) acceptance of an
appointment by a successor as evidenced by an appropriate agreement entered into
by the Company and such successor Registrar or Paying Agent, as the case may be,
and delivered to the Trustee or (ii) notification to the Trustee that the
Trustee shall serve as Registrar or Paying Agent until the appointment of a
successor in accordance with clause (i) above. The Registrar or Paying Agent
may resign at any time upon written notice to the Company and the Trustee.
SECTION 2.04. Paying Agent to Hold Money in Trust. Subject to
------------------------------------
Section 13.08, prior to each due date of the principal and interest on any
Security, the Company shall deposit with the Paying Agent (or if the Company or
a Subsidiary is acting as Paying Agent, segregate and hold in trust for the
benefit of the Persons entitled thereto) a sum sufficient to pay such principal
and interest when so becoming due. The Company shall require each Paying Agent
(other than the Trustee) to agree in writing that the Paying Agent shall hold in
trust for the benefit of Holders or the Trustee all money held by the Paying
Agent for the payment of principal of or interest on the Securities, shall
notify the Trustee of any default by the Company in making any such payment. If
the Company or a Subsidiary of the Company 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 to pay all money held
by it to the Trustee and to account for any funds disbursed by the Paying Agent.
Upon complying with this Section, the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.05. Holder Lists. The Trustee shall preserve in as current
-------------
a form as is reasonably practicable the most recent list available to it of the
names and addresses of Holders. If the Trustee is not the Registrar, the
Company shall furnish, or 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 Holders.
SECTION 2.06. Transfer and Exchange. The Securities shall be issued
----------------------
in registered form and shall be transferable only upon the surrender of a
Security for registration of transfer and in compliance with the Appendix. When
a Security is presented to the Registrar with a request to register a transfer,
the Registrar shall register the transfer as requested if its requirements
therefor are met. When Securities are presented to the Registrar with a request
to exchange them for an equal principal amount of Securities of other
denominations, the Registrar shall make the exchange as requested if the same
requirements are met. To permit registration of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate Securities at the
Registrar's request. The Company may require payment of a sum sufficient to pay
all taxes, assessments or other governmental charges in connection with any
transfer or exchange pursuant to this Section. The Company shall not be
required to make and the Registrar need not
26
register transfers or exchanges of Securities selected for redemption (except,
in the case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or to transfer or exchange any Securities for a period of 15 days
before a selection of Securities to be redeemed.
Prior to the due presentation for registration of transfer of any
Security, the Company, the Note Guarantors, the Trustee, the Paying Agent, and
the 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 (subject to paragraph 2 of the Securities) interest,
if any, on such Security and for all other purposes whatsoever, whether or not
such Security is overdue, and none of the Company, any Note Guarantor, the
Trustee, the Paying Agent, or the Registrar shall be affected by notice to the
contrary.
Any Holder of a Global Security shall, by acceptance of such Global
Security, agree that transfers of beneficial interest in such Global Security
may be effected only through a book-entry system maintained by (a) the Holder of
such Global Security (or its agent) or (b) any Holder of a beneficial interest
in such Global Security, and that ownership of a beneficial interest in such
Global Security shall be required to be reflected in a book entry.
All Securities issued upon any transfer or exchange pursuant to the
terms of this Indenture will evidence the same debt and will be entitled to the
same benefits under this Indenture as the Securities surrendered upon such
transfer or exchange.
SECTION 2.07. Replacement Securities. If a mutilated Security is
-----------------------
surrendered to the Registrar or if the Holder of a Security claims that the
Security has been lost, destroyed or wrongfully taken, the Company shall issue
and the Trustee shall authenticate a replacement Security if the requirements of
Section 8-405 of the Uniform Commercial Code are met, such that the Holder (a)
satisfies the Company or the Trustee within a reasonable time after he has
notice of such loss, destruction or wrongful taking and the Registrar does not
register a transfer prior to receiving such notification, (b) makes such request
to the Company or the Trustee prior to the Security being acquired by a
protected purchaser as defined in Section 8-303 of the Uniform Commercial Code
(a "protected purchaser") and (c) satisfies any other reasonable requirements of
the Trustee (including, without limitation, obtaining from the Company an
Officers' Certificate stating that the requirements of Section 8-405 of the UCC
have been met). If required by the Trustee or the Company, such Holder shall
furnish an indemnity bond sufficient in the judgment of the Trustee to protect
the Company, the Trustee, the Paying Agent and the Registrar from any loss that
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. In the event
any such mutilated, lost, destroyed or wrongfully taken Security has become or
is about to become due and payable, the Company in its discretion may pay such
Security instead of issuing a new Security in replacement thereof.
Every replacement Security is an additional obligation of the Company.
27
The provisions of this Section 2.07 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, lost, destroyed or wrongfully taken
Securities.
SECTION 2.08. Outstanding Securities. Securities outstanding at any
-----------------------
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancelation and those described in this Section
as not outstanding. Subject to Section 13.06, 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 2.07, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a protected 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 and liquidated damages, if any, 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 Holders 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 2.09. Temporary Securities. In the event that Definitive
---------------------
Securities are to be issued under the terms of this Indenture, until such
Definitive Securities are ready for delivery, the Company may prepare and the
Trustee shall authenticate temporary Securities. Temporary Securities shall be
substantially in the form of Definitive Securities but may have variations that
the Company considers appropriate for temporary Securities. Without
unreasonable delay, the Company shall prepare and the Trustee shall authenticate
Definitive Securities and deliver them in exchange for temporary Securities upon
surrender of such temporary Securities at the office or agency of the Company,
without charge to the Holder.
SECTION 2.10. Cancelation. The Company at any time may deliver
------------
Securities to the Trustee for cancelation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel all
Securities surrendered for registration of transfer, exchange, payment or
cancelation and shall dispose of canceled Securities in accordance with its
customary procedures or deliver canceled Securities to the Company pursuant to
written direction by an Officer, provided, however, that the Trustee shall not
-------- -------
be required to destroy Securities. The Company may not issue new Securities to
replace Securities it has redeemed, paid or delivered to the Trustee for
cancelation. The Trustee shall not authenticate Securities in place of canceled
Securities other than pursuant to the terms of this Indenture.
SECTION 2.11. Defaulted Interest. If the Company defaults in a
-------------------
payment of interest on the Securities, the Company shall pay the defaulted
interest (plus interest on such defaulted interest to the extent lawful) in any
lawful manner. The Company may pay the
28
defaulted interest to the Persons who are Holders on a subsequent special record
date. The Company shall fix or cause to be fixed any such special record date
and payment date to the reasonable satisfaction of the Trustee and shall
promptly mail or cause to be mailed to each Holder a notice that states the
special record date, the payment date and the amount of defaulted interest to be
paid.
SECTION 2.12. CUSIP and "ISIN" Numbers. The Company in issuing the
-------------------------
Securities may use "CUSIP" and "ISIN" numbers (if then generally in use) and, if
so, the Trustee shall use "CUSIP" and "ISIN" 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 3
Redemption
----------
SECTION 3.01. 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 60 days before the redemption date unless the Trustee consents
to a shorter period. Such notice shall be accompanied by an Officers'
Certificate and an Opinion of Counsel from the Company to the effect that such
redemption will comply with the conditions herein. Any such notice may be
canceled at any time prior to notice of such redemption being mailed to any
Holder by written notice thereof to the Trustee and shall thereby be void and of
no effect.
SECTION 3.02. Selection of Securities To Be Redeemed. If fewer than
---------------------------------------
all the Securities are to be redeemed, the Trustee shall select the Securities
to be redeemed pro rata or by lot or by such other method that the Trustee shall
deem 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. The Trustee shall notify the
Company promptly of the Securities or portions of Securities to be redeemed.
SECTION 3.03. Notice of Redemption. (a) At least 30 days but not
---------------------
more than 60 days before a date for redemption of Securities, the Company shall
mail a notice of redemption
29
by first-class mail to each Holder of Securities to be redeemed at such Holder's
registered address.
The notice shall identify the Securities to be redeemed and shall
state:
(i) the redemption date;
(ii) the redemption price and the amount of accrued interest to the
redemption date;
(iii) the name and address of the Paying Agent;
(iv) that Securities called for redemption must be surrendered to
the Paying Agent to collect the redemption price;
(v) if fewer than all the outstanding Securities are to be
redeemed, the certificate numbers and principal amounts of the particular
Securities to be redeemed;
(vi) 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;
(vii) the CUSIP or ISIN number, if any, printed on the Securities
being redeemed; and
(viii) that no representation is made as to the correctness or
accuracy of the CUSIP or ISIN number, if any, listed in such notice or
printed on the Securities.
(b) At the Company's request, 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 provide the Trustee with the information required by this
Section.
SECTION 3.04. Effect of Notice of Redemption. Once notice of
-------------------------------
redemption is mailed, Securities called for redemption become due and payable on
the redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest and liquidated damages, if
any, to the redemption date; provided, however, that if the redemption date is
-------- -------
after a regular record date and on or prior to the interest payment date, the
accrued interest and liquidated damages, if any, shall be payable to the Holder
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 3.05. Deposit of Redemption Price. Prior to 10:00 a.m. on
----------------------------
the redemption date, the Company shall deposit with the Paying Agent (or, if the
Company or a
30
Subsidiary is the Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued interest and liquidated
damages, if any, on all Securities to be redeemed on that date other than
Securities or portions of Securities called for redemption that have been
delivered by the Company to the Trustee for cancelation. On and after the
redemption date, interest will cease to accrue on Securities or portions thereof
called for redemption so long as the Company has deposited with the Paying Agent
funds sufficient to pay the principal of, plus accrued and unpaid interest and
liquidated damages, if any, on, the Securities to be redeemed, unless the Paying
Agent is prohibited from making such payment pursuant to the terms of this
Indenture.
SECTION 3.06. 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 principal amount to the unredeemed portion of the Security surrendered.
ARTICLE 4
Covenants
---------
SECTION 4.01. Payment of Securities. The Company shall promptly pay
----------------------
the principal of and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal and interest shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Trustee or the Paying Agent, as the case
may be, is not prohibited from paying such money to the Holders 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.
SECTION 4.02. SEC Reports. Notwithstanding that the Company may not
------------
be subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall file with the SEC (if it will accept such filing), and
provide the Trustee and Holders and prospective Holders (upon request) within 15
days after it files them with the SEC, copies of its annual report and the
information, documents and other reports that are specified in Sections 13 and
15(d) of the Exchange Act. In addition, following a Public Equity Offering, the
Company shall furnish to the Trustee and the Holders, promptly upon their
becoming available, copies of the annual report to shareholders and any other
information provided by the Company, Holdings or Parent to its public
shareholders generally. The Company also shall comply with the other provisions
of TIA ' 314(a).
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive
31
notice of any information contained therein, including the Company's compliance
with any of its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates).
SECTION 4.03. Limitation on Indebtedness. (a) The Company shall
---------------------------
not, and shall not permit any Restricted Subsidiary to, Incur, directly or
indirectly, any Indebtedness; provided, however, that the Company and the Note
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Guarantors may Incur Indebtedness if on the date of such Incurrence and after
giving effect thereto, the Consolidated Coverage Ratio would be greater than
2.00 to 1 if such Indebtedness is Incurred on or prior to December 31, 2001 and
2.25 to 1 if such Indebtedness is Incurred thereafter.
(b) Notwithstanding Section 4.03(a), the Company and its Restricted
Subsidiaries may Incur the following Indebtedness:
(i) (1) Bank Indebtedness in an aggregate principal amount not to
exceed $250.0 million less the aggregate amount of all prepayments of
principal applied to permanently reduce any such Indebtedness pursuant to
Section 4.06 and (2) (A) Indebtedness under the Acquisition Term Loan
Facility in an aggregate principal amount not to exceed $40.0 million less
the aggregate amount of all prepayments applied to permanently reduce any
principal of such Indebtedness pursuant to Section 4.06; provided, however,
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that at the time the Company or any Restricted Subsidiary Incurs any
Indebtedness under this Section 4.06(b)(i)(2), the Company has a
Consolidated Leverage Ratio of 5.00:1 or less, and (B) any Refinancing
Indebtedness in respect thereof;
(ii) Indebtedness of the Company owed to and held by any Wholly Owned
Subsidiary or Indebtedness of a Restricted Subsidiary owed to and held by
the Company or any Wholly Owned Subsidiary; provided, however, that (1) any
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subsequent issuance or transfer of any Capital Stock or any other event
that results in any such Wholly Owned Subsidiary ceasing to be a Wholly
Owned Subsidiary or any subsequent transfer of any such Indebtedness
(except to the Company or a Wholly Owned Subsidiary) shall be deemed, in
each case, to constitute the Incurrence of such Indebtedness by the issuer
thereof, (2) if the Company is the obligor on such Indebtedness, such
Indebtedness is made subordinate and junior in right of payment to the
Securities and (3) if a Restricted Subsidiary that is a Note Guarantor is
the obligor on such Indebtedness and such Indebtedness is owed to and held
by a Wholly Owned Subsidiary that is not a Note Guarantor, such
Indebtedness is expressly subordinated to the prior payment in full in cash
of all obligations of such Restricted Subsidiary with respect to its Note
Guarantee;
(iii) Indebtedness (1) represented by the Securities and the Note
Guarantees, (2) outstanding on the Closing Date (other than the
Indebtedness described in clauses (i) and (ii) above), (3) consisting of
Refinancing Indebtedness Incurred in respect of any Indebtedness described
in this clause (iii) (including Indebtedness that is Refinancing
Indebtedness) or Section 4.03(a), (4) consisting of Guarantees of any
Indebtedness permitted under clauses (i) and (ii) of this paragraph (b) and
(5) consisting of (i) Guarantees by the Company of Indebtedness or other
obligations of any of its
32
Restricted Subsidiaries or (ii) Guarantees by any Note Guarantor of
Indebtedness of the Company or a Restricted Subsidiary, in each case so
long as the Incurrence of the Indebtedness being Guaranteed is permitted
under the terms of this Indenture; provided that if such Guaranteed
--------
Indebtedness is by its express terms subordinated in right of payment to
the Securities or the Note Guarantee of such Restricted Subsidiary, as
applicable, any such Guarantee of the Company or such Note Guarantor with
respect to such Indebtedness shall be subordinated in right of payment to
the Securities or such Note Guarantor's Note Guarantee with respect to the
Securities substantially to the same extent as such Indebtedness is
subordinated to the Securities or the Note Guarantee of such Restricted
Subsidiary, as applicable;
(iv) (1) Indebtedness of a Restricted Subsidiary Incurred and
outstanding on or prior to the date on which such Restricted Subsidiary was
acquired (including by way of merger) by the Company or any Restricted
Subsidiary (other than Indebtedness Incurred as consideration in, or to
provide all or any portion of the funds or credit support utilized to
consummate, the transaction or series of related transactions pursuant to
which such Restricted Subsidiary became a Subsidiary of or was otherwise
acquired by the Company); provided, however, that on the date that such
-------- -------
Restricted Subsidiary is acquired, the Company or such Restricted
Subsidiary would have been able to Incur such Indebtedness under this
Section 4.03 and (2) Refinancing Indebtedness Incurred by a Restricted
Subsidiary in respect of Indebtedness Incurred by such Restricted
Subsidiary pursuant to this clause (iv);
(v) Indebtedness (1) in respect of performance bonds, bankers'
acceptances, letters of credit and surety or appeal bonds provided by the
Company or the Restricted Subsidiaries in the ordinary course of their
business, and (2) under Currency Agreements, Interest Rate Agreements and
Commodity Agreements entered into for bona fide hedging purposes of the
Company or a Restricted Subsidiary in the ordinary course of business;
provided, however, that such agreements do not increase the Indebtedness of
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the Company or the Restricted Subsidiaries outstanding at any time other
than as a result of fluctuations in interest rates, currency exchange rates
or commodity prices or by reason of fees, indemnities and compensation
payable thereunder;
(vi) Indebtedness (including Capitalized Lease Obligations and
Attributable Debt) incurred by the Company or any of the Restricted
Subsidiaries to finance the purchase, lease or improvements of property
(real or personal) or equipment (whether through the direct purchase of
assets or the Capital Stock of any Person owning such assets) in an
aggregate principal amount which, when aggregated with the principal amount
of all other Indebtedness then outstanding and incurred pursuant to this
clause (vi) and all Refinancing Indebtedness incurred to refund, refinance
or replace any Indebtedness incurred pursuant to this clause (vi), does not
exceed the greater of $25.0 million or 5.0% of Total Assets;
(vii) Indebtedness of Foreign Subsidiaries in an aggregate principal
amount not to exceed $15.0 million outstanding at any one time; or
33
(viii) Indebtedness (other than Indebtedness permitted to be Incurred
pursuant to Section 4.03(a) or any other clause of this paragraph (b)) in
an aggregate principal amount on the date of Incurrence that, when added to
all other Indebtedness Incurred pursuant to this clause (viii) and then
outstanding, shall not exceed $30.0 million.
(c) Notwithstanding the foregoing, the Company shall not Incur any
Indebtedness pursuant to Section 4.03(b) above if the proceeds thereof are used,
directly or indirectly, to repay, prepay, redeem, defease, retire, refund or
refinance any Subordinated Obligations unless such Indebtedness shall be
subordinated to the Securities to at least the same extent as such Subordinated
Obligations. The Company shall not Incur any Indebtedness if such Indebtedness
is subordinate or junior in ranking in any respect to any Senior Indebtedness
unless such Indebtedness is Senior Subordinated Indebtedness or is expressly
subordinated in right of payment to Senior Subordinated Indebtedness. In
addition, the Company shall not Incur any Secured Indebtedness which is not
Senior Indebtedness unless contemporaneously therewith effective provision is
made to secure the Securities equally and ratably with (or on a senior basis to,
in the case of Indebtedness subordinated in right of payment to the Securities)
such Secured Indebtedness for so long as such Secured Indebtedness is secured by
a Lien. A Note Guarantor shall not Incur any Indebtedness if such Indebtedness
is by its terms expressly subordinate or junior in ranking in any respect to any
Senior Indebtedness of such Note Guarantor unless such Indebtedness is Senior
Subordinated Indebtedness of such Note Guarantor or is expressly subordinated in
right of payment to Senior Subordinated Indebtedness of such Note Guarantor. In
addition, a Note Guarantor shall not Incur any Secured Indebtedness that is not
Senior Indebtedness of such Note Guarantor unless contemporaneously therewith
effective provision is made to secure the Note Guarantee of such Note Guarantor
equally and ratably with (or on a senior basis to, in the case of Indebtedness
subordinated in right of payment to such Note Guarantee) such Secured
Indebtedness for as long as such Secured Indebtedness is secured by a Lien.
(d) Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or any Restricted Subsidiary may
Incur pursuant to this Section shall not be deemed to be exceeded solely as a
result of fluctuations in the exchange rates of currencies. For purposes of
determining the outstanding principal amount of any particular Indebtedness
Incurred pursuant to this Section 4.03, (i) Indebtedness Incurred pursuant to
the Credit Agreement prior to or on the Closing Date shall be treated as
Incurred pursuant to Section 4.03(b)(i), (ii) Indebtedness permitted by this
Section 4.03 need not be permitted solely by reference to one provision
permitting such Indebtedness but may be permitted in part by one such provision
and in part by one or more other provisions of this Section permitting such
Indebtedness, and (iii) in the event that Indebtedness meets the criteria of
more than one of the types of Indebtedness described in this Section 4.03, the
Company, in its sole discretion, shall classify such Indebtedness and only be
required to include the amount of such Indebtedness in one of such clauses, and
may from time to time reclassify Indebtedness permitted under Section 4.03(b)
among the different clauses thereof.
34
SECTION 4.04. Limitation on Restricted Payments. (a) The Company
----------------------------------
shall not, and shall not permit any Restricted Subsidiary, directly or
indirectly, to (i) declare or pay any dividend or make any distribution on or in
respect of its Capital Stock or make any similar payment (including any payment
in connection with any merger or consolidation involving the Company or any
Subsidiary of the Company) to the direct or indirect holders of its Capital
Stock except (A) dividends or distributions payable solely in its Capital Stock
(other than Disqualified Stock) and (B) dividends or distributions payable to
the Company or a Restricted Subsidiary (and, if such Restricted Subsidiary has
shareholders other than the Company or other Restricted Subsidiaries, to its
other shareholders on a pro rata basis), (ii) purchase, repurchase, redeem,
retire or otherwise acquire for value any Capital Stock of (A) Parent, Holdings
or the Company held by Persons other than the Company or a Restricted Subsidiary
or (B) any Restricted Subsidiary (other than Preferred Stock that is not Voting
Stock) held by any Affiliate of the Company (other than Restricted Subsidiary),
(iii) purchase, repurchase, redeem, retire, defease or otherwise acquire for
value, prior to scheduled maturity, scheduled repayment or scheduled sinking
fund payment any Subordinated Obligations of the Company or any Note Guarantor
(other than the purchase, repurchase, redemption, retirement, defeasance or
other acquisition for value of Subordinated Obligations acquired in anticipation
of satisfying a sinking fund obligation, principal installment or final
maturity, in each case due within one year of the date of acquisition) or (iv)
make any Investment (other than a Permitted Investment) in any Person (any such
dividend, distribution, payment, purchase, redemption, repurchase, defeasance,
retirement or other acquisition or Investment being herein referred to as a
"Restricted Payment") if at the time the Company or such Restricted Subsidiary
makes such Restricted Payment:
(1) a Default shall have occurred and be continuing (or would result
therefrom);
(2) the Company could not Incur at least $1.00 of additional
Indebtedness under Section 4.03(a); or
(3) the aggregate amount of such Restricted Payment and all other
Restricted Payments (the amount so expended, if other than in cash, to be
determined in good faith by the Board of Directors, whose determination
shall be conclusive and evidenced by a resolution of the Board of
Directors) declared or made subsequent to the Closing Date would exceed the
sum, without duplication, of:
(A) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from the beginning of the fiscal
quarter immediately following the fiscal quarter during which the
Closing Date occurs to the end of the most recent fiscal quarter
ending at least 45 days prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a deficit, minus
100% of such deficit);
(B) the aggregate Net Cash Proceeds received by the Company from
the issue or sale of its Capital Stock (other than Disqualified Stock)
subsequent to the Closing Date (other than an issuance or sale to (x)
a Subsidiary of the Company
35
or (y) an employee stock ownership plan or other trust established by
the Company or any of its Subsidiaries);
(C) the amount by which Indebtedness of the Company or its
Restricted Subsidiaries is reduced on the Company's balance sheet upon
the conversion or exchange (other than by or with a Subsidiary of the
Company) subsequent to the Closing Date of any Indebtedness of the
Company or its Restricted Subsidiaries issued after the Closing Date
which is convertible or exchangeable for Capital Stock (other than
Disqualified Stock) of the Company or a Note Guarantor (less the
amount of any cash or the Fair Market Value of other property
distributed by the Company or any Restricted Subsidiary upon such
conversion or exchange);
(D) the amount equal to the net reduction in Investments in
Unrestricted Subsidiaries resulting from (x) payments of dividends,
repayments of the principal of loans or advances or other transfers of
assets to the Company or any Restricted Subsidiary from Unrestricted
Subsidiaries or (y) the redesignation of Unrestricted Subsidiaries as
Restricted Subsidiaries (valued in each case as provided in the
definition of "Investment") not to exceed, in the case of any
Unrestricted Subsidiary, the amount of Investments previously made by
the Company or any Restricted Subsidiary in such Unrestricted
Subsidiary; and
(E) $5.0 million.
(b) The provisions of Section 4.04(a) shall not prohibit:
(i) any purchase, repurchase, redemption, retirement or other
acquisition for value of Capital Stock of the Company or Subordinated
Obligations of the Company or any Note Guarantor made by exchange for, or
out of the proceeds of the substantially concurrent sale of, Capital Stock
of the Company (other than Disqualified Stock and other than Capital Stock
issued or sold to a Subsidiary of the Company or an employee stock
ownership plan or other trust established by the Company or any of its
Subsidiaries); provided, however, that (1) such purchase, repurchase,
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redemption, retirement or other acquisition for value shall be excluded in
the calculation of the amount of Restricted Payments, and (2) the Net Cash
Proceeds from such sale applied in the manner set forth in this clause (i)
shall be excluded from the calculation of amounts under Section
4.04(a)(iv)(3)(B);
(ii) any prepayment, repayment, purchase, repurchase, redemption,
retirement, defeasance or other acquisition for value of Subordinated
Obligations of the Company or a Note Guarantor made by exchange for, or out
of the proceeds of the substantially concurrent sale of, Indebtedness of
the Company or a Note Guarantor that is permitted to be Incurred pursuant
to Section 4.03; provided, however, that such prepayment, repayment,
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purchase, repurchase, redemption, retirement, defeasance or other
acquisition for value shall be excluded in the calculation of the amount of
Restricted Payments;
36
(iii) any prepayment, repayment, purchase, repurchase, redemption,
retirement, defeasance or other acquisition for value of Subordinated
Obligations from Net Available Cash to the extent permitted by Section
4.06; provided, however, that such prepayment, repayment, purchase,
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repurchase, redemption, retirement, defeasance or other acquisition for
value shall be excluded in the calculation of the amount of Restricted
Payments;
(iv) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividends would have complied
with this Section 4.04; provided, however, that such dividends shall be
-------- -------
included in the calculation of the amount of Restricted Payments;
(v) any purchase, repurchase, redemption, retirement or other
acquisition for value of shares of, or options to purchase shares of,
Capital Stock (other than Disqualified Stock) of Holdings, Parent, the
Company or any of its Subsidiaries from employees, former employees,
officers, former officers, directors or former directors of the Company or
any of its Subsidiaries (or permitted transferees of such employees, former
employees, officers, former officers, directors or former directors),
pursuant to the terms of agreements (including employment agreements) or
plans (or amendments thereto) approved by the board of directors of the
Company, Parent or Holdings under which such individuals purchase or sell
or are granted the option to purchase or sell, shares of such Capital
Stock; provided, however, that the aggregate amount of such purchases,
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repurchases, redemptions, retirements and other acquisitions for value,
together with the aggregate amount of payments made under Section
4.04(b)(vi)(3), shall not exceed in any calendar year the sum of (x) $2.0
million and (y) the cash proceeds received in such calendar year by the
Company or any Restricted Subsidiary from the sale of Capital Stock (other
than Disqualified Stock) of Holdings, Parent or the Company to employees,
officers or directors of the Company (provided that such cash proceeds will
not increase the amounts available for Restricted Payments under Section
4.04(a)(3)(B)); provided further, however, that such purchases,
---------------- -------
repurchases, redemptions, retirements and other acquisitions for value
shall be excluded in the calculation of the amount of Restricted Payments;
or
(vi) any payment of dividends, other distributions or other amounts
(including in the form of loans or advances) by the Company for the
purposes set forth in clauses (1) through (3) below; provided, however,
-------- -------
that such dividends, distributions or other amounts set forth in clauses
(1) through (3) shall be excluded in the calculation of the amount of
Restricted Payments for the purposes of Section 4.04(a):
(1) to Parent or Holdings in amounts equal to the amounts required
for Parent or Holdings to pay franchise taxes and other fees
required to maintain its corporate existence and provide for
other operating costs in an aggregate amount of up to $350,000
per fiscal year;
(2) to Parent or Holdings in amounts equal to amounts required for
Parent or Holdings to pay Federal, state and local income taxes
to the extent such
37
income taxes are attributable to the income of the Company and
its Restricted Subsidiaries (and, to the extent of amounts
actually received from its Unrestricted Subsidiaries, in
amounts required to pay such taxes to the extent attributable
to the income of such Unrestricted Subsidiaries);
(3) to Parent or Holdings in amounts equal to amounts expended by
Parent or Holdings for any purchase, repurchase, redemption,
retirement or other acquisition for value of shares of, or
options to purchase shares of, Capital Stock (other than
Disqualified Stock) of Parent or Holdings from employees,
former employees, officers, former officers, directors or
former directors of the Company or any of its Subsidiaries (or
permitted transferees of such employees, former employees,
officers, former officers, directors or former directors),
pursuant to the terms of agreements (including employment
agreements) or plans (or amendments thereto) approved by the
board of directors of the Company, Parent or Holdings under
which such individuals purchase or sell or are granted the
option to purchase or sell, shares of such Capital Stock;
provided, however, that the aggregate amount of such purchases,
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repurchases, redemptions, retirements and other acquisitions
for value, together with the aggregate amount of payments made
under Section 4.04(b)(v), shall not exceed in any calendar year
the sum of (x) $2.0 million and (y) the cash proceeds received
in such calendar year by the Company or any Restricted
Subsidiary from the sale of Capital Stock (other than
Disqualified Stock) of Holdings, Parent or the Company to
employees, officers or directors of the Company (provided that
such cash proceeds will not increase the amounts available for
Restricted Payments under Section 4.04(a)(3)(B)).
SECTION 4.05. Limitation on Restrictions on Distributions from
------------------------------------------------
Restricted Subsidiaries. The Company shall not, and shall not permit any
- ------------------------
Restricted Subsidiary to, create or otherwise cause or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to (a) pay dividends or make any other distributions on
its Capital Stock or pay any Indebtedness or other obligations owed to the
Company, (b) make any loans or advances to the Company or (c) transfer any of
its property or assets to the Company, except:
(i) any encumbrance or restriction pursuant to applicable law or an
agreement in effect at or entered into on the Closing Date;
(ii) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary prior to the date on which such Restricted
Subsidiary was acquired by the Company or a Restricted Subsidiary (other
than Indebtedness Incurred as consideration in, in contemplation of, or to
provide all or any portion of the funds or credit support utilized to
consummate the transaction or series of related transactions pursuant to
which
38
such Restricted Subsidiary became a Restricted Subsidiary or was otherwise
acquired by the Company or a Restricted Subsidiary) and outstanding on such
date;
(iii) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness Incurred pursuant to an agreement
referred to in clause (c) (i) or (c) (ii) of this Section 4.05 or this
clause (c)(iii) or contained in any amendment to an agreement referred to
in clause (c)(i) or (c)(ii) of this Section 4.05 or this clause (c)(iii);
provided, however, that the encumbrances and restrictions contained in any
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such Refinancing agreement or amendment are no less favorable to the
Holders in any material respect than the encumbrances and restrictions
contained in such predecessor agreements;
(iv) in the case of clause (c), any encumbrance or restriction (1)
that restricts in a customary manner the subletting, assignment or transfer
of any property or asset that is subject to a lease, license or similar
contract, or (2) contained in security agreements securing Indebtedness of
the Company or a Restricted Subsidiary to the extent such encumbrance or
restriction restricts the transfer of the property subject to such security
agreements;
(v) with respect to a Restricted Subsidiary, any restriction
imposed pursuant to an agreement entered into for the sale or disposition
of all or substantially all the Capital Stock or assets of such Restricted
Subsidiary pending the closing of such sale or disposition; and
(vi) any encumbrance or restriction existing or created pursuant to
Indebtedness permitted to be Incurred by a Restricted Subsidiary subsequent
to the Closing Date pursuant to Section 4.03; provided, however, that any
such encumbrance or restrictions are reasonable and customary with respect
to the type of Indebtedness being Incurred (under the relevant
circumstances).
SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock.
---------------------------------------------------
(a) The Company shall not, and shall not permit any Restricted Subsidiary to,
make any Asset Disposition unless (i) the Company or such Restricted Subsidiary
receives consideration (including by way of relief from, or by any other Person
assuming sole responsibility for, any liabilities, contingent or otherwise) at
the time of such Asset Disposition at least equal to the Fair Market Value of
the shares and assets subject to such Asset Disposition, (ii) except in the case
of a Permitted Asset Swap, at least 75% of the consideration thereof received by
the Company or such Restricted Subsidiary is in the form of cash and (iii) an
amount equal to 100% of the Net Available Cash from such Asset Disposition is
applied by the Company (or such Restricted Subsidiary, as the case may be) (1)
first, to the extent the Company elects (or is required by the terms of any
- -----
Indebtedness), to prepay, repay, purchase, repurchase, redeem, retire, defease
or otherwise acquire for value Senior Indebtedness of the Company or
Indebtedness of a Restricted Subsidiary (in each case other than Indebtedness
owed to the Company or an Affiliate of the Company (other than an Affiliate of
Chase Capital Partners which is a lender in the ordinary course of business) and
other than obligations in respect of Disqualified Stock) within 180 days
39
after the later of the date of such Asset Disposition or the receipt of such Net
Available Cash; (2) second, to the extent of the balance of Net Available Cash
------
after application in accordance with clause (1), to the extent the Company or
such Restricted Subsidiary elects, to reinvest in Additional Assets (including
by means of an Investment in Additional Assets by a Restricted Subsidiary with
Net Available Cash received by the Company or another Restricted Subsidiary)
within 180 days from the later of such Asset Disposition or the receipt of such
Net Available Cash; (3) third, to the extent of the balance of such Net
-----
Available Cash after application in accordance with clauses (1) and (2), to make
an Offer (as defined in Section 4.06(b)) to purchase Securities pursuant to and
subject to the conditions of Section 4.06(b); provided, however, that if the
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Company elects (or is required by the terms of any Senior Subordinated
Indebtedness), such Offer may be made ratably to purchase the Securities and
other Senior Subordinated Indebtedness of the Company, and (4) fourth, to the
------
extent of the balance of such Net Available Cash after application in accordance
with clauses (1), (2) and (3), for any general corporate purpose permitted by
the terms of this Indenture; provided, however, that in connection with any
-------- -------
final prepayment, repayment, purchase, repurchase, redemption, retirement,
defeasance or other acquisition for value of Indebtedness pursuant to clause
(1), (2) or (4) above, the Company or such Restricted Subsidiary shall retire
such Indebtedness and shall cause the related loan commitment (if any) to be
permanently reduced in an amount equal to the principal amount so prepaid,
repaid, purchased, repurchased, redeemed, retired, defeased or otherwise
acquired for value. Pending final application of any Net Available Cash in
accordance with the foregoing, the Company or a Restricted Subsidiary may use
such Net Available Cash to temporarily reduce (and, within such 180-day period,
reborrow) Indebtedness or invest such Net Available Cash in Temporary Cash
Equivalents. Notwithstanding the foregoing provisions of this Section 4.06, the
Company and the Restricted Subsidiaries shall not be required to apply any Net
Available Cash in accordance with this Section 4.06(a) except to the extent that
the aggregate Net Available Cash from all Asset Dispositions that is not applied
in accordance with this Section 4.06(a) exceeds $7.5 million.
For the purposes of this Section 4.06, the following are deemed to be
cash: (A) the assumption of Indebtedness of the Company (other than obligations
in respect of Disqualified Stock of the Company) or any Restricted Subsidiary
(other than obligations in respect of Disqualified Stock and Preferred Stock of
a Restricted Subsidiary that is not a Note Guarantor) and the release of the
Company or such Restricted Subsidiary from all liability on such Indebtedness in
connection with such Asset Disposition and (B) securities received by the
Company or any Restricted Subsidiary from the transferee that are promptly
converted by the Company or such Restricted Subsidiary into cash.
(b) In the event of an Asset Disposition that requires the purchase
of Securities pursuant to Section 4.06(a)(iii)(3), the Company shall be required
(i) to purchase Securities tendered pursuant to an offer by the Company for the
Securities (the "Offer") at a purchase price of 100% of their principal amount
plus accrued and unpaid interest and liquidated damages thereon, if any, to the
date of purchase (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date) in
accordance with the procedures (including prorating in the event of
oversubscription) set forth in Section 4.06(c) and (ii) to purchase other Senior
Subordinated Indebtedness of the Company on the terms and to the
40
extent contemplated thereby (provided that in no event shall the Company offer
to purchase such other Senior Subordinated Indebtedness of the Company at a
purchase price in excess of 100% of its principal amount (without premium), plus
accrued and unpaid interest thereon, unless an equal premium is offered to
Holders in the Offer). If the aggregate purchase price of Securities (and other
Senior Subordinated Indebtedness) tendered pursuant to the Offer is less than
the Net Available Cash allotted to the purchase of the Securities (and other
Senior Subordinated Indebtedness), the Company shall apply the remaining Net
Available Cash in accordance with Section 4.06(a)(iii)(4). The Company shall not
be required to make an Offer for Securities (and other Senior Subordinated
Indebtedness) pursuant to this Section 4.06 if the Net Available Cash available
therefor (after application of the proceeds as provided in clauses (1) and (2)
of Section 4.06(a)(iii)) is less than $5.0 million for any particular Asset
Disposition (which lesser amount shall be carried forward for purposes of
determining whether an Offer is required with respect to the Net Available Cash
from any subsequent Asset Disposition).
(c) (i) Promptly, and in any event within 15 days after the Company
becomes obligated to make an Offer, the Company shall be obligated to deliver to
the Trustee and send, by first-class mail to each Holder, a written notice
stating that the Holder may elect to have his Securities purchased by the
Company either in whole or in part (subject to prorating as hereinafter
described in the event the Offer is oversubscribed) in integral multiples of
$1,000 of principal amount, at the applicable purchase price. The notice shall
specify a purchase date not less than 30 days nor more than 60 days after the
date of such notice (the "Purchase Date") and shall contain such information
concerning the business of the Company which the Company in good faith believes
will enable such Holders to make an informed decision (which at a minimum shall
include (1) the most recently filed Annual Report on Form 10-K (including
audited consolidated financial statements) of the Company, the most recent
subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form
8-K of the Company filed subsequent to such Quarterly Report, other than Current
Reports describing Asset Dispositions otherwise described in the offering
materials (or corresponding successor reports), (2) a description of material
developments in the Company's business subsequent to the date of the latest of
such reports, and (3) if material, appropriate pro forma financial information)
and all instructions and materials necessary to tender Securities pursuant to
the Offer, together with the address referred to in clause (iii).
(ii) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided above, the Company shall deliver to the
Trustee an Officers' Certificate as to (1) the amount of the Offer (the "Offer
Amount"), (2) the allocation of the Net Available Cash from the Asset
Dispositions pursuant to which such Offer is being made and (3) the compliance
of such allocation with the provisions of Section 4.06(a). On such date, the
Company shall also irrevocably deposit with the Trustee or with a paying agent
(or, if the Company is acting as its own paying agent, segregate and hold in
trust) an amount equal to the Offer Amount to be invested in Temporary Cash
Investments (which Temporary Cash Investments will be made only pursuant to
written instructions of an officer of the Company) and to be held for payment in
accordance with the provisions of this Section. Upon the expiration of the
period for which the Offer remains open (the "Offer Period"), the Company shall
deliver to the Trustee for cancelation the Securities or portions thereof that
have been properly tendered to
41
and are to be accepted by the Company. The Trustee (or the Paying Agent, if not
the Trustee) shall, on the date of purchase, mail or deliver payment to each
tendering Holder in the amount of the purchase price. In the event that the
Offer Amount delivered by the Company to the Trustee is greater than the
purchase price of the Securities (and other Senior Subordinated Indebtedness)
tendered, the Trustee shall deliver the excess to the Company immediately after
the expiration of the Offer Period for application in accordance with this
Section 4.06.
(iii) Holders electing to have a Security purchased shall be required
to surrender the Security, with an appropriate form duly completed (which form
shall include certain information concerning the Holder and the Security), to
the Company at the address specified in the notice at least three Business Days
prior to the Purchase Date. Holders shall be entitled to withdraw their election
if the Trustee or the Company receives not later than one Business Day prior to
the Purchase Date, a facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Security which was delivered by the
Holder for purchase and a duly signed statement that such Holder is withdrawing
his election to have such Security purchased. If at the expiration of the Offer
Period the aggregate principal amount of Securities and any other Senior
Subordinated Indebtedness included in the Offer surrendered by holders thereof
exceeds the Offer Amount, the Company shall select the Securities and other
Senior Subordinated Indebtedness to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by the Company so that only Securities
and other Senior Subordinated Indebtedness in denominations of $1,000, or
integral multiples thereof, shall be purchased). Holders whose Securities are
purchased only in part will be issued new Securities equal in principal amount
to the unpurchased portion of the Securities surrendered.
(iv) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company shall also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section. A Security shall
be deemed to have been accepted for purchase at the time the Trustee, directly
or through an agent, mails or delivers payment therefor to the surrendering
Holder.
(v) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 4.06. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.06, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.06 by virtue
thereof.
SECTION 4.07. Limitation on Transactions with Affiliates. (a) The
-------------------------------------------
Company shall not, and shall not permit any Restricted Subsidiary to, directly
or indirectly, enter into or conduct any transaction or series of related
transactions (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate of the Company (an "Affiliate
Transaction") unless such Affiliate Transaction is on terms (i) that are no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
those that could be obtained at the time of such transaction in arm's-length
dealings with a Person who is
42
not such an Affiliate, (ii) that, in the event that such Affiliate Transaction
involves an aggregate amount in excess of $1.0 million, (1) are set forth in
writing and (2) have been approved by a majority of the members of the Board of
Directors having no personal stake in such Affiliate Transaction and (iii) that,
in the event that such Affiliate Transaction involves an amount in excess of
$10.0 million, have been determined by a nationally recognized appraisal or
investment banking firm to be fair, from a financial standpoint, to the Company
and its Restricted Subsidiaries.
(b) The provisions of Section 4.07(a) shall not prohibit (i) any
Restricted Payment permitted to be paid pursuant to Section 4.04, (ii) any
issuance of securities, or other payments, awards or grants in cash, securities
or otherwise pursuant to, or the funding of, employment arrangements, stock
options and stock ownership plans approved by the Board of Directors, (iii) the
grant of stock options or similar rights to employees and directors of the
Company pursuant to plans approved by the Board of Directors, (iv) loans or
advances to employees in the ordinary course of business in accordance with past
practices of the Company or any Restricted Subsidiary, but in any event not to
exceed $2.0 million in the aggregate outstanding at any one time, (v) the
payment of reasonable fees to directors of the Company and its Subsidiaries who
are not employees of the Company or its Subsidiaries, (vi) any transaction
between the Company and a Wholly Owned Subsidiary or between Wholly Owned
Subsidiaries or (vii) the performance of any agreement as in effect as of the
Closing Date (including the Tax Sharing Agreement, dated July 21, 1998, and the
Amended and Restated Management Services Agreement, dated October 6, 1998 (as
each is defined in the Offering Memorandum)) or any amendment or replacement
thereto so long as any such amendment or replacement agreement is not more
disadvantageous to the Holders of the Securities in any material respect than
the original agreement as in effect as of the Closing Date.
SECTION 4.08. Change of Control. (a) Upon the occurrence of a
------------------
Change of Control, each Holder shall have the right to require that the Company
repurchase all or any part of such Holder's Securities at a purchase price in
cash equal to 101% of the principal amount thereof plus accrued and unpaid
interest and liquidated damages, if any, to the date of repurchase (subject to
the right of Holders of record on the relevant record date to receive interest
due on the relevant interest payment date), in accordance with the terms
contemplated in Section 4.08(b); provided, however, that notwithstanding the
-------- -------
occurrence of a Change of Control, the Company shall not be obligated to
repurchase the Securities pursuant to this Section 4.08 in the event that it has
exercised its right to redeem all the Securities under paragraph 5 of the
Securities. In the event that at the time of such Change of Control the terms of
the Bank Indebtedness restrict or prohibit the repurchase of Securities pursuant
to this Section 4.08, then prior to the mailing of the notice to Holders
provided for in Section 4.08(b) below but in any event within 45 days following
any Change of Control, the Company shall (i) repay in full all Bank Indebtedness
or, if doing so will allow the repurchase of Securities, offer to repay in full
all Bank Indebtedness and repay the Bank Indebtedness of each lender who has
accepted such offer or (ii) obtain the requisite consent under the agreements
governing the Bank Indebtedness to permit the repurchase of the Securities as
provided for in Section 4.08(b).
43
(b) Within 45 days following any Change of Control (except as
provided in the proviso to the first sentence of Section 4.08(a)), the Company
shall mail a notice to each Holder with a copy to the Trustee (the "Change of
Control Offer") stating:
(i) that a Change of Control has occurred and that such Holder has
the right to require the Company to purchase all or a portion of such
Holder's Securities at a purchase price in cash equal to 101% of the
principal amount thereof, plus accrued and unpaid interest and liquidated
damages, if any, to the date of purchase (subject to the right of Holders
of record on the relevant record date to receive interest due on the
relevant interest payment date);
(ii) the circumstances and relevant facts and financial information
regarding such Change of Control;
(iii) the repurchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); and
(iv) the instructions determined by the Company, consistent with this
Section, that a Holder must follow in order to have its Securities
purchased.
(c) Holders electing to have a Security purchased shall be required
to surrender the Security, with an appropriate form duly completed, to the
Company at the address specified in the notice at least three Business Days
prior to the purchase date. Holders shall be entitled to withdraw their election
if the Trustee or the Company receives not later than one Business Day prior to
the purchase date a facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Security which was delivered for
purchase by the Holder and a statement that such Holder is withdrawing his
election to have such Security purchased. Holders whose Securities are purchased
only in part will be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered.
(d) On the purchase date, all Securities purchased by the Company
under this Section shall be delivered to the Trustee for cancelation, and the
Company shall pay the purchase price plus accrued and unpaid interest, if any,
to the Holders entitled thereto.
(e) Notwithstanding the foregoing provisions of this Section, the
Company will not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in this
Section 4.08 applicable to a Change of Control Offer made by the Company and
purchases all Securities validly tendered and not withdrawn under such Change of
Control Offer.
(f) At the time the Company delivers Securities to the Trustee which
are to be accepted for purchase, the Company shall also deliver an Officers'
Certificate stating that such Securities are to be accepted by the Company
pursuant to and in accordance with the terms of this Section 4.08. A Security
shall be deemed to have been accepted for purchase at the time the
44
Trustee, directly or through an agent, mails or delivers payment therefor to the
surrendering Holder.
(g) Prior to any Change of Control Offer, the Company shall deliver
to the Trustee an Officers' Certificate stating that all conditions precedent
contained herein to the right of the Company to make such offer have been
complied with.
(h) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 4.08. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.08, the Company shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.08 by virtue
thereof.
SECTION 4.09. 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 they would normally have
knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the
Default, its status and what action the Company is taking or proposes to take
with respect thereto. The Company also shall comply with Section 314(a)(4) of
the TIA.
SECTION 4.10. Further Instruments and Acts. Upon request of the
-----------------------------
Trustee, the Company shall 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 4.11. Future Note Guarantors. The Company shall cause (a)
-----------------------
each Domestic Subsidiary and (b) each Foreign Subsidiary that Guarantees any
Indebtedness (other than Indebtedness of a Restricted Subsidiary that is not a
Note Guarantor), to become a Note Guarantor, and if applicable, execute and
deliver to the Trustee a supplemental indenture substantially in the form of
Exhibit C pursuant to which such Subsidiary will Guarantee payment of the
Securities.
SECTION 4.12. Limitation on Lines of Business. The Company shall
--------------------------------
not, and shall not permit any Restricted Subsidiary to, engage in any business,
other than a Permitted Business.
SECTION 4.13. Limitation on the Sale or Issuance of Capital Stock of
------------------------------------------------------
Restricted Subsidiaries. The Company shall not sell or otherwise dispose of any
- ------------------------
shares of Capital Stock (other than Preferred Stock that is not Voting Stock) of
a Restricted Subsidiary, and shall not permit any Restricted Subsidiary,
directly or indirectly, to issue or sell or otherwise dispose of any shares of
its Capital Stock (other than Preferred Stock that is not Voting Stock) except:
(a) to the Company or a Wholly Owned Subsidiary; (b) if, immediately after
giving effect to such issuance, sale or other disposition, neither the Company
nor any of its Subsidiaries own any Capital Stock of such Restricted Subsidiary
or (c) if, immediately after giving effect to such
45
issuance or sale, such Restricted Subsidiary would no longer constitute a
Restricted Subsidiary and any Investment in such Person remaining after giving
effect thereto would have been permitted to be made under Section 4.04 if made
on the date of such issuance, sale or other disposition (and such Investment
shall be deemed to be an Investment made for purposes of such Section 4.04). The
proceeds of any sale of such Capital Stock subject to and permitted by this
Section 4.13 shall be treated as Net Available Cash from an Asset Disposition
and shall be applied in accordance with Section 4.06.
ARTICLE 5
Successor Company
-----------------
SECTION 5.01. (a) When Company May Merge or Transfer Assets. The
------------------------------------------
Company shall not consolidate with or merge with or into, or convey, transfer or
lease all or substantially all its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the "Successor
Company") shall be a corporation 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 a
supplemental indenture hereto, 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 (and
treating any Indebtedness which becomes an obligation of the Successor
Company or any Restricted Subsidiary as a result of such transaction as
having been Incurred by the Successor Company or such Restricted Subsidiary
at the time of such transaction), no Default shall have occurred and be
continuing;
(iii) immediately after giving effect to such transaction, the
Successor Company would be able to Incur an additional $1.00 of
Indebtedness pursuant to Section 4.03(a);
(iv) 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; and
(v) the Company shall have delivered to the Trustee an Opinion of
Counsel reasonably acceptable to the Trustee to the effect that the Holders
will not recognize income, gain or loss for Federal income tax purposes as
a result of such transaction and will be subject to Federal income tax on
the same amounts, in the same manner and at the same times as would have
been the case if such transaction had not occurred.
The Successor Company shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under this Indenture, but the
predecessor
46
Company in the case of a conveyance, transfer or lease of all or substantially
all its assets shall not be released from the obligation to pay the principal of
and interest on the Securities.
(b) Subject to Sections 4.06 and 11.02(b), the Company shall not
permit any Note Guarantor to consolidate with or merge with or into, or convey,
transfer or lease all or substantially all of its assets to any Person unless:
(i) the resulting, surviving or transferee Person (the "Successor
Guarantor") will be a corporation organized and existing under the laws of
the United States of America, any State thereof or the District of Columbia
(unless the Successor Guarantor is a Foreign Subsidiary), and such Person
(if not a Note Guarantor) shall expressly assume, by a supplemental
indenture, executed and delivered to the Trustee, in form satisfactory to
the Trustee, all the obligations of such Note Guarantor under its Note
Guarantee;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor
Guarantor or any Restricted Subsidiary as a result of such transaction as
having been Incurred by the Successor Guarantor or such Restricted
Subsidiary at the time of such transaction), no 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.
(c) Notwithstanding the foregoing, (i) any Restricted Subsidiary may
consolidate with, merge into or transfer all or part of its properties and
assets to the Company and (ii) the Company may merge with an Affiliate
incorporated solely for the purpose of reincorporating the Company in another
jurisdiction to realize tax or other benefits.
ARTICLE 6
Defaults and Remedies
---------------------
SECTION 6.01. Events of Default. An "Event of Default" occurs if:
------------------
(a) the Company defaults in any payment of interest on any Security
when the same becomes due and payable or in any payment of liquidated
damages, whether or not such payment shall be prohibited by Article 10, and
such default continues for a period of 30 days;
(b) the Company (i) defaults in the payment of the principal of any
Security when the same becomes due and payable at its Stated Maturity, upon
required redemption or repurchase, upon declaration or otherwise, whether
or not such payment shall be prohibited by Article 10 or (ii) fails to
redeem or purchase Securities when required
47
pursuant to this Indenture or the Securities, whether or not such
redemption or purchase shall be prohibited by Article 10;
(c) the Company fails to comply with Section 5.01;
(d) the Company fails to comply with Section 4.02, 4.03, 4.04, 4.05,
4.06, 4.07, 4.08, 4.11, 4.12 or 4.13 (other than a failure to purchase
Securities when required under Section 4.06 or 4.08) and such failure
continues for 30 days after receipt of the notice specified below;
(e) the Company or any Note Guarantor fails to comply with any of its
agreements in the Securities or this Indenture (other than those referred
to in (a), (b), (c) or (d) above) and such failure continues for 60 days
after receipt of the notice specified below;
(f) Indebtedness of the Company or any Restricted Subsidiary is not
paid within any applicable grace period after final maturity (and has not
subsequently been paid) or the acceleration (which has not been rescinded)
by the holders thereof because of a default and the total amount of such
Indebtedness unpaid or accelerated exceeds $10.0 million or its foreign
currency equivalent at the time and such failure continues for 10 days
after receipt of the notice specified below;
(g) the Company or any Significant Subsidiary pursuant to or within
the meaning of any Bankruptcy Law:
(i) commences a voluntary case;
(ii) consents to the entry of an order for relief against it in
an involuntary case;
(iii) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(iv) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any Significant
Subsidiary in an involuntary case;
(ii) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
48
(iii) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days;
(i) any judgment or decree for the payment of money (other than
judgments or decrees which are covered by enforceable insurance policies or
indemnifications issued by or entered into with solvent Persons) in excess
of $10.0 million or its foreign currency equivalent is rendered against the
Company or any Restricted Subsidiary and either (i) an enforcement
proceeding has been commenced by any creditor upon such judgment or decree
and is not stayed or dismissed within 10 days or (ii) there is a period of
60 days following the entry of such judgment or decree during which such
judgment or decree is not discharged, waived or the execution thereof
stayed; or
(j) any Note Guarantee ceases to be in full force and effect (except
as contemplated by the terms hereof) or any Note Guarantor or Person acting
by or on behalf of such Note Guarantor denies or disaffirms its obligations
under this Indenture or any Note Guarantee and such Default continues for
10 days after receipt of the notice specified below.
The foregoing shall 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 (d), (e), (f) or (j) above is not an Event of
Default until the Trustee notifies the Company or Holders of at least 25% in
principal amount of the outstanding Securities notify the Company and the
Trustee of the Default and the Company or the Note Guarantor, as applicable,
does not cure such Default within the time specified 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 a Responsible Officer of the Trustee,
within 30 days after the occurrence thereof, written notice in the form of an
Officers' Certificate of any event which with the giving of notice or the lapse
of time would become an Event of Default, its status and what action the Company
is taking or proposes to take with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than an
-------------
Event of Default specified in Section 6.01(g) or (h) with respect to the
Company) occurs and is
49
continuing, the Trustee by notice to the Company or the Holders of at least 25%
in 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 6.01(g) or (h) with respect to the Company occurs, the
principal of and 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 principal amount of the
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. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
---------------
continuing, the Trustee may pursue any available remedy 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 Holder 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 cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in
------------------------
principal amount of the Securities by notice to the Trustee may waive an
existing Default and its consequences except (a) a Default in the payment of the
principal of or interest on a Security, (b) a Default arising from the failure
to redeem or purchase any Security when required pursuant to the terms of this
Indenture or (c) a Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Holder affected. When a Default
is waived, it is deemed cured, but no such waiver shall extend to any subsequent
or other Default or impair any consequent right.
SECTION 6.05. Control by Majority. The Holders of a majority in
--------------------
principal amount of the Securities 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
may refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Holders 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. Prior to taking any
action hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by taking or
not taking such action.
50
SECTION 6.06. Limitation on Suits. (a) Except to enforce the right
--------------------
to receive payment of principal, premium (if any) or interest when due, no
Holder may pursue any remedy with respect to this Indenture or the Securities
unless:
(i) the Holder gives to a Responsible Officer of the Trustee written
notice stating that an Event of Default is continuing;
(ii) the Holders of at least 25% in principal amount of the
Securities make a written request to the Trustee to pursue the remedy;
(iii) such Holder or Holders offer to the Trustee reasonable security
or indemnity reasonably 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 principal amount of the Securities
do not give the Trustee a direction inconsistent with the request during
such 60-day period.
(b) A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over another Holder.
SECTION 6.07. Rights of Holders to Receive Payment. Notwithstanding
-------------------------------------
any other provision of this Indenture, the right of any Holder to receive
payment of principal of and liquidated damages and interest on the Securities
held by such Holder, on or after the respective due dates expressed or provided
for 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 6.08. Collection Suit by Trustee. If an Event of Default
---------------------------
specified in Section 6.01(a) or (b) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or any other obligor on the Securities for the whole amount then due and
owing (together with interest on overdue principal and (to the extent lawful) on
any unpaid interest at the rate provided for in the Securities) and the amounts
provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file
---------------------------------
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Holders allowed in
any judicial proceedings relative to the Company, any Subsidiary or Note
Guarantor, their creditors or their 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,
51
disbursements and advances of the Trustee, its agents and its counsel, and any
other amounts due the Trustee under Section 7.07.
SECTION 6.10. Priorities. If the Trustee collects any money or
-----------
property pursuant to this Article 6, it shall pay out the money or property in
the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to holders of Senior Indebtedness of the Company to the
extent required by Article 10 and to holders of Senior Indebtedness of the
Note Guarantors to the extent required by Article 12;
THIRD: to Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, and any liquidated damages without
preference or priority of any kind, according to the amounts due and
payable on the Securities for principal, any liquidated damages and
interest, respectively; and
FOURTH: to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section. At least 15 days before such record date, the
Trustee shall mail to each Holder 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, 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 does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of
more than 10% in principal amount of the Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. Neither the Company
---------------------------------
nor any Note Guarantor (to the extent it may lawfully do so) shall 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 and each Note Guarantor (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.
52
ARTICLE 7
Trustee
-------
SECTION 7.01. 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,
the Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture (but need
not confirm or investigate the accuracy of mathematical or other facts
stated therein).
(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;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer unless it shall be conclusively
determined by a court of competent jurisdiction that 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 6.05.
(iv) 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.
(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.
53
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(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 and to the provisions of the TIA.
SECTION 7.02. 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 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 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; provided, however, that the Trustee's conduct does not constitute wilful
-------- -------
misconduct or negligence.
(e) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal 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 not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond,
debenture, note or other paper or document unless requested in writing to do so
by the Holders of not less than a majority in principal amount of the Securities
at the time outstanding, but the Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its
-----------------------------
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any
54
Paying Agent, 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 7.04. Trustee's Disclaimer. The Trustee shall not be
---------------------
responsible for and makes no representation as to the validity or adequacy of
this Indenture, any Note Guarantee 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 Note 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. The Trustee shall not be charged with knowledge of any Default
or Event of Default under Sections 6.01(c), (d), (e), (f), (i) or (j) or of the
identity of any Significant Subsidiary unless either (a) a Responsible Officer
shall have actual knowledge thereof or (b) a Responsible Officer of the Trustee
shall have received notice thereof in accordance with Section 13.02 hereof from
the Company, any Note Guarantor or any Holder.
SECTION 7.05. Notice of Defaults. If a Default occurs and is
-------------------
continuing and, subject to Section 7.04 hereof, if it is actually known to a
Responsible Officer of the Trustee, the Trustee shall mail to each Holder notice
of the Default within the earlier of 90 days after it occurs or 30 days after it
is known to a Responsible Officer. Except in the case of a Default in payment
of principal of or interest on any Security (including payments pursuant to the
redemption provisions of such Security, if any), the Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Holders.
SECTION 7.06. Reports by Trustee to Holders. As promptly as
------------------------------
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Holder a brief report dated as of such May 15 that complies
with Section 313(a) of the TIA if and to the extent required thereby. The
Trustee shall also comply with Section 313(b) of the TIA.
A copy of each report at the time of its mailing to Holders shall be
filed 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 7.07. Compensation and Indemnity. The Company shall pay to
---------------------------
the Trustee from time to time such compensation as shall be agreed to in writing
by the Company and the Trustee from time to time for its services. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services.
Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company and each Note Guarantor, jointly and severally shall
indemnify the Trustee against any and all loss, liability or expense (including
reasonable attorneys' fees and expenses) including taxes (other than taxes
55
based upon, measured by or determined by the income of the Trustee) incurred by
or in connection with the administration of this trust and the performance of
its duties hereunder. The Trustee shall notify the Company of any claim for
which it may seek indemnity promptly upon obtaining actual knowledge thereof;
provided, however, that any failure so to notify the Company shall not relieve
- -------- -------
the Company or any Note Guarantor of its indemnity obligations hereunder. The
Company shall defend the claim and the indemnified party shall provide
reasonable cooperation at the Company's expense in the defense. Such indemnified
parties may have separate counsel and the Company and the Note Guarantors, as
applicable shall pay the fees and expenses of such counsel; provided, however,
-------- -------
that the Company shall not be required to pay such fees and expenses if it
assumes such indemnified parties' defense and, in such indemnified parties'
reasonable judgment, there is no conflict of interest between the Company and
the Note Guarantors, as applicable, and such parties in connection with such
defense. The Company need not reimburse any expense or indemnify against any
loss, liability or expense incurred by an indemnified party through such party's
own wilful misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section, 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 and liquidated damages, if any, on particular
Securities.
The Company's payment obligations pursuant to this Section shall
survive the satisfaction or discharge of this Indenture, any rejection or
termination of this Indenture under any bankruptcy law or the resignation or
removal of the Trustee. Without prejudice to any other rights available to the
Trustee under applicable law, when the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01(g) or (h) with respect to the
Company, the expenses are intended to constitute expenses of administration
under the Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. (a) The Trustee may resign at
-----------------------
any time by so notifying the Company. The Holders of a majority in principal
amount of the Securities may remove the Trustee by so notifying the Trustee 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.
(b) 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
56
Trustee in such event being referred to herein as the retiring Trustee), the
Company shall promptly appoint a successor Trustee.
(c) 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 only upon
receipt of charges due to the Resigning Trustee, 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 Holders. 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 7.07.
(d) If a successor Trustee does not take office within 60 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.
(e) If the Trustee fails to comply with Section 7.10, unless the
Trustee's duty to resign is stayed as provided in TIA '310(b), any Holder who
has been a bona fide holder of a Security for at least six months may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
(f) Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.
(g) If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Trustee within 60 days after the giving of such
notice of resignation or removal, the resigning or removed Trustee, as the case
may be, may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities.
SECTION 7.09. 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.
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.
57
SECTION 7.10. Eligibility; Disqualification. The Trustee shall at
------------------------------
all times satisfy the requirements of TIA ' 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
' 310(b), subject to its right to apply for a stay of its duty to resign under
the penultimate paragraph of TIA '310(b); provided, however, that there shall be
-------- -------
excluded from the operation of TIA ' 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 ' 310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company. The
--------------------------------------------------
Trustee shall comply with TIA ' 311(a), excluding any creditor relationship
listed in TIA ' 311(b). A Trustee who has resigned or been removed shall be
subject to TIA ' 311(a) to the extent indicated.
SECTION 7.12. Investment of Funds. In the event of a loss on the
--------------------
sale of any Temporary Cash Investments purchased at the direction of the Company
(after giving effect to any interest or other income thereon except to the
extent theretofore paid to the Company), the Trustee shall have no
responsibility in respect of such loss except that the Trustee shall notify the
Company of the amount of such loss and the Company shall promptly pay such
amount to the Trustee to be credited as part of the moneys originally invested.
ARTICLE 8
Discharge of Indenture; Defeasance
----------------------------------
SECTION 8.01. Discharge of Liability on Securities; Defeasance. (a)
-------------------------------------------------
When (i) all outstanding Securities (other than Securities replaced or paid
pursuant to Section 2.07) have been canceled or delivered to the Trustee for
cancelation 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 3 hereof, and the Company irrevocably deposits with the
Trustee funds in an amount sufficient or U.S. Government Obligations, the
principal of and interest on which will be sufficient, or a combination thereof
sufficient, in the written opinion of a nationally recognized firm of
independent public accountants delivered to the Trustee (which delivery shall
only be required if U.S. Government Obligations have been so deposited) to pay
the principal of and interest on the outstanding Securities when due at maturity
or upon redemption of, including interest thereon to maturity or such redemption
date (other than Securities replaced or paid pursuant to Section 2.07) and
liquidated damages, if any, and if in either case the Company pays all other
sums payable hereunder by the Company, then this Indenture shall, subject to
Section 8.01(c), cease to be of further effect. The Trustee shall acknowledge
satisfaction and discharge of this Indenture on demand of the Company
accompanied by an Officers' Certificate and an Opinion of Counsel and at the
cost and expense of the Company.
58
(b) Subject to Sections 8.01(c) and 8.02, the Company at any time may
terminate (i) all of its obligations under the Securities and this Indenture
("legal defeasance option") or (ii) its obligations under Sections 4.02, 4.03,
4.04, 4.05, 4.06, 4.07, 4.08, 4.11, 4.12 and 4.13, and the operation of Section
5.01(a)(iii), 6.01(d), 6.01(f), 6.01(g) (with respect to Significant
Subsidiaries of the Company only), 6.01(h) (with respect to Significant
Subsidiaries of the Company only) and 6.01(i) ("covenant defeasance option").
The Company may exercise its legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option. In the event that the Company
terminates all of its obligations under the Securities and this Indenture by
exercising its legal defeasance option or its covenant defeasance option, the
obligations under the Note Guarantees shall each be terminated simultaneously
with the termination of such obligations.
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 6.01(d),
6.01(f), 6.01(g), (with respect to Significant Subsidiaries of the Company
only), 6.01(h) (with respect to Significant Subsidiaries of the Company only) or
6.01(i) or because of the failure of the Company to comply with clause (iii) of
Section 5.01(a).
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 that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.07, 7.08 and in
this Article 8 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 7.07, 8.04 and 8.05 shall
survive.
SECTION 8.02. (a) Conditions to Defeasance. The Company may
-------------------------
exercise its legal defeasance option or its covenant defeasance option only if:
(i) the Company irrevocably deposits in trust with the Trustee money
in an amount sufficient or U.S. Government Obligations, the principal of
and interest on which will be sufficient, or a combination thereof
sufficient, to pay the principal, premium (if any) and interest on the
Securities when due at maturity or redemption, as the case may be,
including interest thereon to maturity or such redemption date and
liquidated damages, if any;
(ii) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion 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 the Securities to maturity or redemption, as the case may be;
59
(iii) 123 days pass after the deposit is made and during the 123-day
period no Default specified in Section 6.01(g) or (h) with respect to the
Company occurs which is continuing at the end of the period;
(iv) the deposit does not constitute a default under any other
agreement binding on the Company and is not prohibited by Article 10;
(v) the Company delivers to the Trustee an Opinion of Counsel
reasonably acceptable to the Trustee to the effect that the trust resulting
from the deposit does not constitute, or is qualified as, a regulated
investment company under the Investment Company Act of 1940;
(vi) in the case of the legal defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel reasonably acceptable
to the Trustee stating that (1) the Company has received from, or there has
been published by, the Internal Revenue Service a ruling, or (2) since the
date of this Indenture there has been a change in the applicable Federal
income tax law, in either case to the effect that, and based thereon such
Opinion of Counsel shall confirm that, the Holders will not recognize
income, gain or loss for Federal income tax purposes as a result of such
defeasance and will be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such defeasance had not occurred;
(vii) in the case of the covenant defeasance option, the Company
shall have delivered to the Trustee an Opinion of Counsel reasonably
acceptable to the Trustee to the effect that the Holders will not recognize
income, gain or loss for Federal income tax purposes as a result of such
covenant defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred; and
(viii) the Company delivers to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent to
the defeasance and discharge of the Securities as contemplated by this
Article 8 have been complied with.
(b) 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 3.
SECTION 8.03. Application of Trust Money. The Trustee shall hold in
---------------------------
trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It shall apply the deposited money and the money from U.S. Government
Obligations through the Paying Agent and in accordance with this Indenture to
the payment of principal of and interest on the Securities. Money and securities
so held in trust are not subject to Article 10 or 12.
SECTION 8.04. Repayment to Company. The Trustee and the Paying Agent
---------------------
shall promptly turn over to the Company upon request any money or U.S.
Government Obligations held by it as provided in this Article which, in the
written opinion of nationally
60
recognized firm of independent public accountants delivered to the Trustee
(which delivery shall only be required if U.S. Government Obligations have been
so deposited), are in excess of the amount thereof which would then be required
to be deposited to effect an equivalent discharge or defeasance in accordance
with this Article.
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, and, thereafter, Holders entitled to the money must look to the Company
for payment as general creditors and the Trustee, and the Paying Agent shall
have no further liability with respect to such monies.
SECTION 8.05. 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.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is
--------------
unable to apply any money or U.S. Government Obligations in accordance with this
Article 8 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 8 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 8; provided, however, that, if the
--------- -------
Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE 9
Amendments
----------
SECTION 9.01. (a) Without Consent of Holders. The Company, the Note
---------------------------
Guarantors and the Trustee may amend this Indenture or the Securities without
notice to or consent of any Holder:
(i) to cure any ambiguity, omission, defect or inconsistency;
(ii) to comply with Article 5;
(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 described in Section 163(f)(2)(B) of the Code;
61
(iv) to make any change in Article 10 or Article 12 that would
limit or terminate the benefits available to any holder of Senior
Indebtedness (or representatives thereof) under Article 10 or Article 12;
(v) to add additional Guarantees with respect to the Securities or
to secure the Securities;
(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 comply with any requirement of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the
TIA;
(viii) to make any change that does not adversely affect the rights
of any Holder in a material respect; or
(ix) to provide for the issuance of the Exchange Securities or
Private Exchange Securities, which shall have terms substantially identical
in all material respects to the Initial Securities (except that the
transfer restrictions contained in the Initial Securities shall be modified
or eliminated, as appropriate), and which shall be treated, together with
any outstanding Initial Securities, as a single issue of securities.
(b) An amendment under this Section 9.01 may not make any change to
Article 10 or Article 12 that adversely affects the rights under Article 10 or
Article 12 of any holder of Senior Indebtedness then outstanding unless the
holders of such Senior Indebtedness (or any group or representative thereof
authorized to give a consent) consent to such change.
After an amendment under this Section 9.01 becomes effective, the
Company shall mail to Holders a notice briefly describing such amendment. The
failure to give such notice to all Holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section.
SECTION 9.02. With Consent of Holders. (a) The Company, the Note
------------------------
Guarantors and the Trustee may amend this Indenture or the Securities without
notice to any Holder 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 the
Securities). However, without the consent of each Holder affected, an amendment
may not:
(i) reduce the amount of Securities whose Holders must consent to
an amendment;
(ii) reduce the rate of or extend the time for payment of interest
or any liquidated damages on any Security;
62
(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 accelerate the time at which any Security may be redeemed;
(v) make any Security payable in money other than that stated in
the Security;
(vi) make any change in Article 10 or Article 12 that adversely
affects the rights of any Holder under Article 10 or Article 12;
(vii) make any change in Section 6.04 or 6.07 or the second sentence
of this Section 9.02; or
(viii) modify the Note Guarantees in any manner adverse to the Holders
in a material respect.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
An amendment under this Section 9.02 may not make any change that
adversely affects the rights under Article 10 or Article 12 of any holder of
Senior Indebtedness then outstanding unless the holders of such Senior
Indebtedness (or any group or representative thereof authorized to give a
consent) consent to such change.
After an amendment under this Section 9.02 becomes effective, the
Company shall mail to Holders a notice briefly describing such amendment. The
failure to give such notice to all Holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section 9.02.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment
------------------------------------
to this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. (a) 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. However, any
such Holder or subsequent Holder may revoke the consent or waiver as to such
Holder's Security or portion of the Security if the Trustee receives the notice
of revocation before the date on which the Trustee receives an Officers'
Certificate from the Company certifying that the requisite number of consents
have been received. After an amendment or waiver becomes effective, it shall
bind every Holder. An amendment or waiver becomes effective upon the (i)
receipt by the Company or the Trustee of the requisite number of consents, (ii)
satisfaction of conditions to effectiveness as set forth in this Indenture and
any
63
indenture supplemental hereto containing such amendment or waiver and (iii)
execution of such amendment or waiver (or supplemental indenture) by the Company
and the Trustee.
(b) The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders 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 Holders 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 9.05. 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 or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.06. Trustee to Sign Amendments. The Trustee shall sign any
---------------------------
amendment authorized pursuant to this Article 9 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 receive indemnity reasonably satisfactory to it and to receive,
and (subject to Section 7.01) shall be fully protected in relying upon, an
Officers' Certificate and an Opinion of Counsel stating that such amendment is
authorized or permitted by this Indenture and that such amendment is the legal,
valid and binding obligation of the Company and the Note Guarantors enforceable
against them in accordance with its terms, subject to customary exceptions, and
complies with the provisions hereof (including Section 9.03).
ARTICLE 10
Subordination
-------------
SECTION 10.01. Agreement To Subordinate. The Company agrees, and
-------------------------
each Holder by accepting a Security agrees, that the Indebtedness evidenced by
the Securities is subordinated in right of payment, to the extent and in the
manner provided in this Article 10, to the prior payment in full of all Senior
Indebtedness of the Company and that the subordination is for the benefit of and
enforceable by the holders of such Senior Indebtedness. The Securities shall in
all respects rank pari passu with all other Senior Subordinated Indebtedness of
---- -----
the Company and only Indebtedness of the Company that is Senior Indebtedness of
the Company shall rank senior to the Securities in accordance with the
provisions set forth herein. For purposes of this Article 10, the Indebtedness
evidenced by the Securities shall be deemed to
64
include any liquidated damages payable pursuant to the provisions set forth in
the Securities and the Registration Agreement. All provisions of this Article 10
shall be subject to Section 10.12.
SECTION 10.02. Liquidation, Dissolution, Bankruptcy. Upon any
-------------------------------------
payment or distribution of the assets of the Company to creditors upon a
liquidation or a dissolution of the Company or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to the Company or its
property:
(a) holders of Senior Indebtedness of the Company shall be entitled to
receive payment in full of such Senior Indebtedness before Holders shall
be entitled to receive any payment of principal of or interest on the
Securities; and
(b) until the Senior Indebtedness of the Company is paid in full , any
payment or distribution to which Holders would be entitled but for this
Article 10 shall be made to holders of such Senior Indebtedness as their
interests may appear, except that Holders may receive shares of stock and
any debt securities that are subordinated to such Senior Indebtedness to at
least the same extent as the Securities.
SECTION 10.03. Default on Senior Indebtedness. The Company may not
-------------------------------
pay the principal of, premium (if any) or interest on the Securities or make any
deposit pursuant to Section 8.01 and may not otherwise repurchase, redeem or
otherwise acquire or retire for value any Securities (collectively, "pay the
Securities") if (a) any Designated Senior Indebtedness of the Company is not
paid when due or (b) any other default on any Designated Senior Indebtedness of
the Company occurs and the maturity of such Designated Senior Indebtedness is
accelerated in accordance with its terms unless, in either case, (i) the default
has been cured or waived and any such acceleration has been rescinded or (ii)
such Designated Senior Indebtedness has been paid in full; provided, however,
-------- -------
that the Company may pay the Securities without regard to the foregoing if the
Company and a Responsible Officer of the Trustee receive written notice
approving such payment from the Representative of such Designated Senior
Indebtedness with respect to which either of the events set forth in clause (a)
or (b) of this sentence has occurred and is continuing. During the continuance
of any default (other than a default described in clause (a) or (b) of the
preceding sentence) with respect to any Designated Senior Indebtedness of the
Company pursuant to which the maturity thereof may be accelerated immediately
without further notice (except such notice as may be required to effect such
acceleration) or the expiration of any applicable grace periods, the Company may
not pay the Securities for a period (a "Payment Blockage Period") commencing
upon the receipt by a Responsible Officer of the Trustee (with a copy to the
Company) of written notice (a "Blockage Notice") of such default from the
Representative of such Designated Senior Indebtedness specifying an election to
effect a Payment Blockage Period and ending 179 days thereafter (or earlier if
such Payment Blockage Period is terminated (a) by written notice to the Trustee
and the Company from the Person or Persons who gave such Blockage Notice, (b) by
repayment in full of such Designated Senior Indebtedness or (c) because the
default giving rise to such Blockage Notice is no longer continuing).
Notwithstanding the provisions described in the immediately preceding sentence
(but subject to the provisions contained in the second preceding and in the
immediately succeeding sentence), unless the holders of such Designated Senior
Indebtedness or
65
the Representative of such holders shall have accelerated the maturity of such
Designated Senior Indebtedness, the Company may resume payments on the
Securities after the end of such Payment Blockage Period, including any missed
payments. Not more than one Blockage Notice may be given in any consecutive 360-
day period, irrespective of the number of defaults with respect to Designated
Senior Indebtedness during such period; provided, however, that if any Blockage
-------- -------
Notice within such 360-day period is given by or on behalf of any holders of
Designated Senior Indebtedness other than the Bank Indebtedness, the
Representative of the Bank Indebtedness may give another Blockage Notice within
such period; provided further, however, that in no event may the total number of
---------------- -------
days during which any Payment Blockage Period or Periods is in effect exceed 179
days in the aggregate during any 360 consecutive day period. For purposes of
this Section 10.03, no default or event of default that existed or was
continuing on the date of the commencement of any Payment Blockage Period with
respect to the Designated Senior Indebtedness initiating such Payment Blockage
Period shall be, or be made, the basis of the commencement of a subsequent
Payment Blockage Period by the Representative of such Designated Senior
Indebtedness, whether or not within a period of 360 consecutive days, unless
such default or event of default shall have been cured or waived for a period of
not less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of Securities. If payment of
--------------------------------------
the Securities is accelerated because of an Event of Default, the Company or the
Trustee (provided, that the Trustee shall have received written notice from the
--------
Company, on which notice the Trustee shall be entitled to conclusively rely)
shall promptly notify the holders of the Designated Senior Indebtedness of the
Company (or their Representative) of the acceleration. If any Designated Senior
Indebtedness of the Company is outstanding, the Company may not pay the
Securities until five Business Days after such holders or the Representative of
such Designated Senior Indebtedness receive notice of such acceleration and,
thereafter, may pay the Securities only if this Article 10 otherwise permits
payment at that time.
SECTION 10.05. When Distribution Must Be Paid Over. If a payment or
------------------------------------
distribution is made to Holders that because of this Article 10 should not have
been made to them, the Holders who receive the payment or distribution shall
hold it in trust for holders of Senior Indebtedness of the Company and pay it
over to them as their interests may appear.
SECTION 10.06. Subrogation. After all Senior Indebtedness of the
------------
Company is paid in full and until the Securities are paid in full, Holders shall
be subrogated to the rights of holders of such Senior Indebtedness to receive
distributions applicable to Senior Indebtedness. A distribution made under this
Article 10 to holders of such Senior Indebtedness which otherwise would have
been made to Holders is not, as between the Company and Holders, a payment by
the Company on such Senior Indebtedness.
SECTION 10.07. Relative Rights. This Article 10 defines the relative
----------------
rights of Holders and holders of Senior Indebtedness of the Company. Nothing in
this Indenture shall:
66
(a) impair, as between the Company and Holders, the obligation of the
Company, which is absolute and unconditional, to pay principal of and
interest on and liquidated damages, if any, in respect of, the Securities
in accordance with their terms; or
(b) prevent the Trustee or any Holder from exercising its available
remedies upon a Default, subject to the rights of holders of Senior
Indebtedness of the Company to receive distributions otherwise payable to
Holders.
SECTION 10.08. Subordination May Not Be Impaired by Company. No
---------------------------------------------
right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Securities shall be impaired
by any act or failure to act by the Company or by its failure to comply with
this Indenture.
SECTION 10.09. Rights of Trustee and Paying Agent. Notwithstanding
-----------------------------------
Section 10.03, the Trustee or Paying Agent may continue to make payments on the
Securities and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Responsible Officer of the
Trustee receives notice satisfactory to it that payments may not be made under
this Article 10. The Company, the Registrar, the Paying Agent, a Representative
or a holder of Senior Indebtedness of the Company may give the notice; provided,
--------
however, that, if an issue of Senior Indebtedness of the Company has a
- -------
Representative, only the Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness of the Company with the same rights it would have if it were not
Trustee. The Registrar and the Paying Agent may do the same with like rights.
The Trustee shall be entitled to all the rights set forth in this Article 10
with respect to any Senior Indebtedness of the Company which may at any time be
held by it, to the same extent as any other holder of such Senior Indebtedness;
and nothing in Article 7 shall deprive the Trustee of any of its rights as such
holder. Nothing in this Article 10 shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 7.07 or any other Section of this
Indenture.
SECTION 10.10. Distribution or Notice to Representative. Whenever a
-----------------------------------------
distribution is to be made or a notice given to holders of Senior Indebtedness
of the Company, the distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit
----------------------------------------------------
Right To Accelerate. The failure to make a payment pursuant to the Securities
- --------------------
by reason of any provision in this Article 10 shall not be construed as
preventing the occurrence of a Default. Nothing in this Article 10 shall have
any effect on the right of the Holders or the Trustee to accelerate the maturity
of the Securities.
SECTION 10.12. Trust Monies Not Subordinated. Notwithstanding
------------------------------
anything contained herein to the contrary, payments from money or the proceeds
of U.S. Government Obligations held in trust under Article 8 by the Trustee for
the payment of principal of and
67
interest on the Securities and liquidated damages, if any, shall not be
subordinated to the prior payment of any Senior Indebtedness of the Company or
subject to the restrictions set forth in this Article 10, and none of the
Holders shall be obligated to pay over any such amount to the Company or any
holder of Senior Indebtedness of the Company or any other creditor of the
Company.
SECTION 10.13. Trustee Entitled To Rely. Upon any payment or
-------------------------
distribution pursuant to this Article 10, the Trustee and the Holders shall be
entitled to rely conclusively (a) upon any order or decree of a court of
competent jurisdiction in which any proceedings of the nature referred to in
Section 10.02 are pending, (b) upon a certificate of the liquidating trustee or
agent or other Person making such payment or distribution to the Trustee or to
the Holders or (c) upon the Representatives for the holders of Senior
Indebtedness of the Company for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of such Senior
Indebtedness and other Indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 10. In the event that the Trustee
determines, in good faith, that evidence is required with respect to the right
of any Person as a holder of Senior Indebtedness of the Company to participate
in any payment or distribution pursuant to this Article 10, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and other facts pertinent to the rights of such Person under this
Article 10, and, if such evidence is not furnished, the Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment. The provisions of Sections 7.01 and 7.02 shall
be applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 10.
SECTION 10.14. Trustee To Effectuate Subordination. Each Holder by
------------------------------------
accepting a Security authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to acknowledge or effectuate the
subordination between the Holders and the holders of Senior Indebtedness of the
Company as provided in this Article 10 and appoints the Trustee as attorney-in-
fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
-------------------------------------------
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
- -------------
holders of Senior Indebtedness of the Company and shall not be liable to any
such holders if it shall mistakenly pay over or distribute to Holders or the
Company or any other Person, money or assets to which any holders of Senior
Indebtedness of the Company shall be entitled by virtue of this Article 10 or
otherwise.
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
---------------------------------------------
Subordination Provisions. Each Holder by accepting a Security acknowledges and
- -------------------------
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration to each holder of any Senior Indebtedness of
the Company, whether such Senior Indebtedness was created or acquired before or
after the issuance of the Securities, to acquire and continue to hold, or to
continue to hold, such Senior Indebtedness and such holder of such Senior
Indebtedness
68
shall be deemed conclusively to have relied on such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness.
ARTICLE 11
Note Guarantees
---------------
SECTION 11.01. (a) Note Guarantees. Each Note Guarantor hereby
----------------
jointly and severally irrevocably and unconditionally guarantees, as a primary
obligor and not merely as a surety, to each Holder and to the Trustee and its
successors and assigns (i) the full and punctual payment when due, whether at
Stated Maturity, by acceleration, by redemption or otherwise, of all obligations
of the Company under this Indenture (including obligations to the Trustee) and
the Securities, whether for payment of principal of, interest on or liquidated
damages, if any, in respect of the Securities and all other monetary obligations
of the Company under this Indenture and the Securities and (ii) the full and
punctual performance within applicable grace periods of all other monetary
obligations of the Company whether for fees, expenses, indemnification or
otherwise under this Indenture and the Securities (all the foregoing being
hereinafter collectively called the "Guaranteed Obligations"). Each Note
Guarantor further agrees that the Guaranteed Obligations may be extended or
renewed, in whole or in part, without notice or further assent from each such
Note Guarantor, and that each such Note Guarantor shall remain bound under this
Article 11 notwithstanding any extension or renewal of any Guaranteed
Obligation.
(b) Each Note Guarantor waives presentation to, demand of payment
from and protest to the Company of any of the Guaranteed Obligations and also
waives notice of protest for nonpayment. Each Note Guarantor waives notice of
any default under the Securities or the Guaranteed Obligations. The obligations
of each Note Guarantor hereunder shall not be affected by (i) 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; (ii) any extension or renewal of
any thereof; (iii) any rescission, waiver, amendment or modification of any of
the terms or provisions of this Indenture, the Securities or any other agreement
except to the extent such rescission, waiver, amendment or modification
explicitly relates to such Note Guarantor's obligations hereunder; (iv) the
release of any security held by any Holder or the Trustee for the Guaranteed
Obligations or any of them; (v) the failure of any Holder or Trustee to exercise
any right or remedy against any other guarantor of the Guaranteed Obligations;
or (vi) any change in the ownership of such Note Guarantor, except as provided
in Section 11.02(b).
(c) Each Note Guarantor hereby waives any right to which it may be
entitled to have its obligations hereunder divided among the Note Guarantors,
such that such Note Guarantor's obligations would be less than the full amount
claimed. Each Note Guarantor hereby waives any right to which it may be
entitled to have the assets of the Company first be used and depleted as payment
of the Company's or such Note Guarantor's obligations hereunder prior to any
amounts being claimed from or paid by such Note Guarantor hereunder. Each Note
69
Guarantor hereby waives any right to which it may be entitled to require that
the Company be sued prior to an action being initiated against such Note
Guarantor.
(d) Each Note Guarantor further agrees that its Note Guarantee herein
constitutes a guarantee of payment, performance and compliance when due (and not
a guarantee of collection) and waives any right to require that any resort be
had by any Holder or the Trustee to any security held for payment of the
Guaranteed Obligations.
(e) The Note Guarantee of each Note Guarantor is, to the extent and
in the manner set forth in Article 12, subordinated and subject in right of
payment to the prior payment in full of the principal of and premium, if any,
and interest on all Senior Indebtedness of the relevant Note Guarantor and is
made subject to such provisions of this Indenture.
(f) Except as expressly set forth in Sections 8.01(b), 11.02 and
11.06, the obligations of each Note Guarantor 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 of setoff, counterclaim, recoupment or termination
whatsoever or by reason of the invalidity, illegality or unenforceability of the
Guaranteed Obligations or otherwise. Without limiting the generality of the
foregoing, the obligations of each Note Guarantor 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, wilful 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
any Note Guarantor or would otherwise operate as a discharge of any Note
Guarantor as a matter of law or equity.
(g) Each Note Guarantor agrees that its Note Guarantee shall remain
in full force and effect until payment in full of all the Guaranteed
Obligations. Each Note Guarantor further agrees that its Note Guarantee herein
shall continue to be effective or be reinstated, as the case may be, if at any
time payment, or any part thereof, of principal of or interest on any Guaranteed
Obligation is rescinded or must otherwise be restored by any Holder or the
Trustee upon the bankruptcy or reorganization of the Company or otherwise.
(h) In furtherance of the foregoing and not in limitation of any
other right which any Holder or the Trustee has at law or in equity against any
Note Guarantor by virtue hereof, upon the failure of the Company to pay the
principal of or interest on any Guaranteed Obligation when and as the same shall
become due, whether at maturity, by acceleration, by redemption or otherwise, or
to perform or comply with any other Guaranteed Obligation, each Note Guarantor
hereby promises to and shall, 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 Guaranteed
Obligations, (ii) accrued and unpaid interest on such Guaranteed 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.
70
(i) Each Note Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any Guaranteed
Obligations guaranteed hereby until payment in full of all Guaranteed
Obligations and all obligations to which the Guaranteed Obligations are
subordinated as provided in Article 12. Each Note Guarantor further agrees
that, as between it, on the one hand, and the Holders and the Trustee, on the
other hand, (i) the maturity of the Guaranteed Obligations guaranteed hereby may
be accelerated as provided in Article 6 for the purposes of any Note Guarantee
herein, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the Guaranteed Obligations guaranteed hereby,
and (ii) in the event of any declaration of acceleration of such Guaranteed
Obligations as provided in Article 6, such Guaranteed Obligations (whether or
not due and payable) shall forthwith become due and payable by such Note
Guarantor for the purposes of this Section 11.01.
(j) Upon request of the Trustee, each Note Guarantor shall 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 11.02. Limitation on Liability. (a) Any term or provision
------------------------
of this Indenture to the contrary notwithstanding, the maximum aggregate amount
of the Guaranteed Obligations guaranteed hereunder by any Note Guarantor shall
not exceed the maximum amount that can be hereby guaranteed without rendering
this Indenture, as it relates to such Note Guarantor, voidable under applicable
law relating to fraudulent conveyance or fraudulent transfer or similar laws
affecting the rights of creditors generally.
(b) A Note Guarantee as to any Note Guarantor shall terminate and be
of no further force or effect and such Note Guarantor shall be deemed to be
released from all obligations under this Article 11 upon (i) the merger or
consolidation of such Note Guarantor with or into any Person other than the
Company or a Subsidiary of the Company where such Note Guarantor is not the
surviving entity of such consolidation or merger or (ii) the sale by the Company
or any Subsidiary of the Company (or any pledgee of the Company) of the Capital
Stock of such Note Guarantor, where, after such sale, such Note Guarantor is no
longer a Subsidiary of the Company; provided, however, that each such merger,
-------- -------
consolidation or sale (or, in the case of a sale by such a pledgee, the
disposition of the proceeds of such sale) shall comply with Section 4.06 and
Section 5.01(b). At the request of the Company, the Trustee shall execute and
deliver an appropriate instrument evidencing such release (in the form provided
by the Company).
SECTION 11.03. Successors and Assigns. This Article 11 shall be
-----------------------
binding upon each Note Guarantor and (subject to the provisions hereof) its
successors and assigns and 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.
71
SECTION 11.04. 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 11 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 11 at law,
in equity, by statute or otherwise.
SECTION 11.05. Modification. No modification, amendment or waiver of
-------------
any provision of this Article 11, nor the consent to any departure by any Note
Guarantor 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. No
notice to or demand on any Note Guarantor in any case shall entitle such Note
Guarantor to any other or further notice or demand in the same, similar or other
circumstances.
SECTION 11.06. Execution of Supplemental Indenture for Future Note
---------------------------------------------------
Guarantors. Each Subsidiary which is required to become a Note Guarantor
- -----------
pursuant to Section 4.11 shall promptly execute and deliver to the Trustee a
supplemental indenture in the form of Exhibit C hereto pursuant to which such
Subsidiary shall become a Note Guarantor under this Article 11 and shall
guarantee the Guaranteed Obligations. Concurrently with the execution and
delivery of such supplemental indenture, the Company shall deliver to the
Trustee an Opinion of Counsel and an Officers' Certificate to the effect that
such supplemental indenture has been duly authorized, executed and delivered by
such Subsidiary and that, subject to the application of bankruptcy, insolvency,
moratorium, fraudulent conveyance or transfer and other similar laws relating to
creditors' rights generally and to the principles of equity, whether considered
in a proceeding at law or in equity, the Note Guarantee of such Note Guarantor
is a legal, valid and binding obligation of such Note Guarantor, enforceable
against such Note Guarantor in accordance with its terms and or to such other
matters as the Trustee may reasonably request.
SECTION 11.07. Non-Impairment. The failure to endorse a Note Guarantee
---------------
on any Security shall not affect or impair the validity thereof.
ARTICLE 12
Subordination of the Note Guarantees
------------------------------------
SECTION 12.01. Agreement To Subordinate. Each Note Guarantor agrees,
-------------------------
and each Holder by accepting a Security agrees, that the obligations of a Note
Guarantor hereunder are subordinated in right of payment, to the extent and in
the manner provided in this Article 12, to the prior payment in full of all
Senior Indebtedness of such Note Guarantor and that the subordination is for the
benefit of and enforceable by the holders of such Senior Indebtedness of such
Note Guarantor. The obligations hereunder with respect to a Note Guarantor
shall in all
72
respects rank pari passu with all other Senior Subordinated Indebtedness of such
---- -----
Note Guarantor and shall rank senior to all existing and future Subordinated
Obligations of such Note Guarantor; and only Indebtedness of such Note Guarantor
that is Senior Indebtedness of such Note Guarantor shall rank senior to the
obligations of such Note Guarantor in accordance with the provisions set forth
herein.
SECTION 12.02. Liquidation, Dissolution, Bankruptcy. Upon any
-------------------------------------
payment or distribution of the assets of a Note Guarantor to creditors upon a
liquidation or a dissolution of such Note Guarantor or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to such
Note Guarantor and its properties:
(a) holders of Senior Indebtedness of such Note Guarantor shall be
entitled to receive payment in full of such Senior Indebtedness before
Holders shall be entitled to receive any payment pursuant to any Guaranteed
Obligations from such Note Guarantor; and
(b) until the Senior Indebtedness of such Note Guarantor is paid in
full, any payment or distribution to which Holders would be entitled but
for this Article 12 shall be made to holders of such Senior Indebtedness as
their respective interests may appear, except that Holders may receive
shares of stock and any debt securities that are subordinated to such
Senior Indebtedness to at least the same extent as the Note Guarantees.
SECTION 12.03. Default on Designated Senior Indebtedness of a Note
---------------------------------------------------
Guarantor. A Note Guarantor may not make any payment pursuant to any of the
- ----------
Guaranteed Obligations or repurchase, redeem or otherwise retire any Securities
(collectively, "pay its Guarantee") if (a) any Designated Senior Indebtedness of
such Note Guarantor is not paid when due or (b) any other default on any
Designated Senior Indebtedness of such Note Guarantor occurs and the maturity of
such Designated Senior Indebtedness is accelerated in accordance with its terms
unless, in either case, (i) the default has been cured or waived and any such
acceleration has been rescinded or (ii) such Designated Senior Indebtedness has
been paid in full; provided, however, that such Note Guarantor may pay its
-------- -------
Guarantee without regard to the foregoing if such Note Guarantor and a
Responsible Officer of the Trustee receive written notice approving such payment
from the Representative of the holders of such Designated Senior Indebtedness
with respect to which either of the events in clause (a) or (b) of this sentence
has occurred and is continuing. During the continuance of any default (other
than a default described in clause (a) or (b) of the preceding sentence) with
respect to any Designated Senior Indebtedness of a Note Guarantor pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except such notice as may be required to effect such acceleration) or the
expiration of any applicable grace periods, such Note Guarantor may not pay its
Guarantee for a period (a "Guarantee Payment Blockage Period") commencing upon
the receipt by a Responsible Officer of the Trustee (with a copy to such Note
Guarantor and the Company) of written notice (a "Guarantee Blockage Notice") of
such default from the Representative of such Designated Senior Indebtedness of
such Note Guarantor specifying an election to effect a Guarantee Payment
Blockage Period and ending 179 days thereafter (or
73
earlier if such Guarantee Payment Blockage Period is terminated (a) by written
notice to a Responsible Officer of the Trustee (with a copy to such Note
Guarantor and the Company) from the Person or Persons who gave such Guarantee
Blockage Notice, (b) because such Designated Senior Indebtedness has been repaid
in full or (c) because the default giving rise to such Guarantee Blockage Notice
is no longer continuing). Notwithstanding the provisions described in the
immediately preceding sentence (but subject to the provisions contained in the
second preceding and in the immediately succeeding sentence), unless the holders
of such Designated Senior Indebtedness or the Representative of such holders
shall have accelerated the maturity of such Designated Senior Indebtedness, such
Note Guarantor may resume to paying its Note Guarantee after such Guarantee
Payment Blockage Period, including any missed payments. Not more than one
Guarantee Blockage Notice may be given with respect to a Note Guarantor in any
consecutive 360-day period, irrespective of the number of defaults with respect
to Designated Senior Indebtedness of such Note Guarantor during such period;
provided, however, that if any Guarantee Blockage Notice within such 360-day
- -------- -------
period is given by or on behalf of any holders of Designated Senior Indebtedness
of such Note Guarantor other than the Bank Indebtedness, the Representative of
the Bank Indebtedness may give another Guarantee Blockage Notice within such
period; provided further,however, that in no event may the total number of days
---------------- -------
during which any Guarantee Payment Blockage Period or Periods is in effect
exceed 179 days in the aggregate during any 360 consecutive day period. For
purposes of this Section 12.03, no default or event of default that existed or
was continuing on the date of the commencement of any Guarantee Payment Blockage
Period with respect to the Designated Senior Indebtedness initiating such
Guarantee Payment Blockage Period shall be, or be made, the basis of the
commencement of a subsequent Guarantee Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 12.04. Demand for Payment. If payment of the Securities is
-------------------
accelerated because of an Event of Default and a demand for payment is made on a
Note Guarantor pursuant to Article 11, the Trustee (provided that the Trustee
--------
shall have received written notice from the Company or such Note Guarantor, on
which notice the Trustee shall be entitled to conclusively rely) shall promptly
notify the holders of the Designated Senior Indebtedness of such Note Guarantor
(or the Representative of such holders) of such demand. If any Designated
Senior Indebtedness of such Note Guarantor is outstanding, such Note Guarantor
may not pay its Guarantee until five Business Days after such holders or the
Representative of the holders of the Designated Senior Indebtedness of such Note
Guarantor receive notice of such demand and, thereafter, may pay its Guarantee
only if this Article 12 otherwise permits payment at that time.
SECTION 12.05. When Distribution Must Be Paid Over. If a payment or
------------------------------------
distribution is made to Holders that because of this Article 12 should not have
been made to them, the Holders who receive the payment or distribution shall
hold such payment or distribution in trust for holders of the Senior
Indebtedness of the relevant Note Guarantor and pay it over to them as their
respective interests may appear.
74
SECTION 12.06. Subrogation. After all Senior Indebtedness of a Note
------------
Guarantor is paid in full and until the Securities are paid in full in cash,
Holders shall be subrogated to the rights of holders of Senior Indebtedness of
such Note Guarantor to receive distributions applicable to Designated Senior
Indebtedness of such Note Guarantor. A distribution made under this Article 12
to holders of Senior Indebtedness of such Note Guarantor which otherwise would
have been made to Holders is not, as between such Note Guarantor and Holders, a
payment by such Note Guarantor on Senior Indebtedness of such Note Guarantor.
SECTION 12.07. Relative Rights. This Article 12 defines the relative
----------------
rights of Holders and holders of Senior Indebtedness of a Note Guarantor.
Nothing in this Indenture shall:
(a) impair, as between a Note Guarantor and Holders, the obligation of
a Note Guarantor which is absolute and unconditional, to make payments with
respect to the Guaranteed Obligations to the extent set forth in Article
11; or
(b) prevent the Trustee or any Holder from exercising its available
remedies upon a default by a Note Guarantor under its obligations with
respect to the Guaranteed Obligations, subject to the rights of holders of
Senior Indebtedness of such Note Guarantor to receive distributions
otherwise payable to Holders.
SECTION 12.08. Subordination May Not Be Impaired by a Note
--------------------------------------------
Guarantor. No right of any holder of Senior Indebtedness of a Note Guarantor to
- ----------
enforce the subordination of the obligations of such Note Guarantor hereunder
shall be impaired by any act or failure to act by such Note Guarantor or by its
failure to comply with this Indenture.
SECTION 12.09. Rights of Trustee and Paying Agent. Notwithstanding
-----------------------------------
Section 12.03, the Trustee or the Paying Agent may continue to make payments on
the Securities and shall not be charged with knowledge of the existence of facts
that would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Responsible Officer of the
Trustee receives notice satisfactory to it that payments may not be made under
this Article 12. A Note Guarantor, the Registrar or co-registrar, the Paying
Agent, a Representative or a holder of Senior Indebtedness of a Note Guarantor
may give the notice; provided, however, that if an issue of Senior Indebtedness
-------- -------
of a Note Guarantor has a Representative, only the Representative may give the
notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness of a Note Guarantor with the same rights it would have if it were
not Trustee. The Registrar and co-registrar and the Paying Agent may do the
same with like rights. The Trustee shall be entitled to all the rights set
forth in this Article 12 with respect to any Senior Indebtedness of a Note
Guarantor which may at any time be held by it, to the same extent as any other
holder of Senior Indebtedness of such Note Guarantor; and nothing in Article 7
shall deprive the Trustee of any of its rights as such holder. Nothing in this
Article 12 shall apply to claims of, or payments to, the Trustee under or
pursuant to Section 7.07 or any other Section of this Indenture.
75
SECTION 12.10. Distribution or Notice to Representative. Whenever a
-----------------------------------------
distribution is to be made or a notice given to holders of Senior Indebtedness
of a Note Guarantor, the distribution may be made and the notice given to their
Representative (if any).
SECTION 12.11. Article 12 Not To Prevent Events of Default or Limit
----------------------------------------------------
Right To Accelerate. The failure of a Note Guarantor to make a payment on any
- --------------------
of its obligations by reason of any provision in this Article 12 shall not be
construed as preventing the occurrence of a default by such Note Guarantor under
such obligations. Nothing in this Article 12 shall have any effect on the right
of the Holders or the Trustee to make a demand for payment on a Note Guarantor
pursuant to Article 11.
SECTION 12.12. Trustee Entitled To Rely. Upon any payment or
-------------------------
distribution pursuant to this Article 12, the Trustee and the Holders shall be
entitled to rely (a) upon any order or decree of a court of competent
jurisdiction in which any proceedings of the nature referred to in Section 12.02
are pending, (b) upon a certificate of the liquidating trustee or agent or other
Person making such payment or distribution to the Trustee or to the Holders or
(c) upon the Representatives for the holders of Senior Indebtedness of a Note
Guarantor for the purpose of ascertaining the Persons entitled to participate in
such payment or distribution, the holders of the Senior Indebtedness of a Note
Guarantor and other Indebtedness of a Note Guarantor, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 12. In the event that the Trustee
determines, in good faith, that evidence is required with respect to the right
of any Person as a holder of Senior Indebtedness of a Note Guarantor to
participate in any payment or distribution pursuant to this Article 12, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness of such Note
Guarantor held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and other facts pertinent to the
rights of such Person under this Article 12, and, if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment. The
provisions of Sections 7.01 and 7.02 shall be applicable to all actions or
omissions of actions by the Trustee pursuant to this Article 12.
SECTION 12.13. Trustee To Effectuate Subordination. Each Holder by
------------------------------------
accepting a Security authorizes and directs the Trustee on his or her behalf to
take such action as may be necessary or appropriate to acknowledge or effectuate
the subordination between the Holders and the holders of Senior Indebtedness of
each of the Note Guarantors as provided in this Article 12 and appoints the
Trustee as attorney-in-fact for any and all such purposes.
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior
-------------------------------------------
Indebtedness of a Note Guarantor. The Trustee shall not be deemed to owe any
- ---------------------------------
fiduciary duty to the holders of Senior Indebtedness of a Note Guarantor and
shall not be liable to any such holders if it shall mistakenly pay over or
distribute to Holders or the relevant Note Guarantor or any other Person, money
or assets to which any holders of Senior Indebtedness of such Note Guarantor
shall be entitled by virtue of this Article 12 or otherwise.
76
SECTION 12.15. Reliance by Holders of Senior Indebtedness of a Note
----------------------------------------------------
Guarantor on Subordination Provisions. Each Holder by accepting a Security
- --------------------------------------
acknowledges and agrees that the foregoing subordination provisions are, and are
intended to be, an inducement and a consideration to each holder of any Senior
Indebtedness of a Note Guarantor, whether such Senior Indebtedness was created
or acquired before or after the issuance of the Securities, to acquire and
continue to hold, or to continue to hold, such Senior Indebtedness and such
holder of Senior Indebtedness shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Indebtedness.
SECTION 12.16. Defeasance. The terms of this Article 12 shall not
-----------
apply to payments from money or the proceeds of U.S. Government Obligations held
in trust by the Trustee for the payment of principal of and interest on the
Securities pursuant to the provisions described in Section 8.03.
ARTICLE 13
Miscellaneous
-------------
SECTION 13.01. Trust Indenture Act Controls. If and to the extent
-----------------------------
that any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by, or with another provision (an "incorporated provision")
included in this Indenture by operation of, TIA" 310 to 318, inclusive, such
imposed duties or incorporated provision shall control.
SECTION 13.02. 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:
c/o USS Holdings, Inc.
Route 522 North
P.O. Box 187
Berkeley Springs, West Virginia 25411
Attention of:
Chief Financial Officer
if to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21 West
Floor 21 West
New York, NY 10286
Telephone: (212) 815-5939
77
Facsimile: (212) 815-5915
Attention of:
Corporate Trust Administration
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Holder shall be mailed, first
class mail, to the Holder at the Holder'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 Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
SECTION 13.03. Communication by Holders with Other Holders. Holders
--------------------------------------------
may communicate pursuant to TIA ' 312(b) with other Holders 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 ' 312(c).
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.
---------------------------------------------------
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:
(a) an Officers' Certificate in form 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
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 13.05. Statements Required in Certificate or Opinion. Each
----------------------------------------------
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture (other than pursuant to Section 4.09) shall
include:
(a) a statement that the individual making such certificate or opinion
has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement 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
78
(d) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 13.06. 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, any Note
Guarantor or by any Person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any Note
Guarantor 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 Responsible
Officer of the Trustee actually knows are so owned shall be so disregarded.
Subject to the foregoing, only Securities outstanding at the time shall be
considered in any such determination.
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar. The
---------------------------------------------
Trustee may make reasonable rules for action by or a meeting of Holders. The
Registrar and the Paying Agent may make reasonable rules for their functions.
SECTION 13.08. Legal Holidays. A "Legal Holiday" is a Saturday, a
---------------
Sunday or other day on which banking institutions are not required by law or
regulation 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 for the intervening period. If a regular
record date is a Legal Holiday, the record date shall not be affected.
SECTION 13.09. 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 13.10. No Recourse Against Others. A director, officer,
---------------------------
employee or stockholder, as such, of the Company or any of the Note Guarantors,
shall not have any liability for any obligations of the Company or any of the
Note 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 Holder shall waive and release all such liability.
The waiver and release shall be part of the consideration for the issue of the
Securities.
SECTION 13.11. Successors. All agreements of the Company and each
-----------
Note Guarantor in this Indenture and the Securities shall bind its successors.
All agreements of the Trustee in this Indenture shall bind its successors.
SECTION 13.12. 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.
79
SECTION 13.13. 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.
80
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
BETTER MINERALS & AGGREGATES
COMPANY,
by /s/ John A. Ulizio
---------------------------------------------
Name: John A. Ulizio
Title: Vice President, General Counsel and
Assistant Secretary
U.S. SILICA COMPANY,
by /s/ John A. Ulizio
---------------------------------------------
Name: John A. Ulizio
Title: Senior Vice President, General Counsel
and Assistant Secretary
BETTER MATERIALS CORPORATION,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Assistant Secretary
GEORGE F. PETTINOS, INC.,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Secretary
OTTAWA SILICA COMPANY,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Secretary
81
THE FULTON LAND AND TIMBER
COMPANY,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Secretary
PENNSYLVANIA GLASS SAND
CORPORATION,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Secretary
BUCKS COUNTY CRUSHED STONE COMPANY
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Assistant Secretary
CHIPPEWA FARMS CORPORATION,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Assistant Secretary
SHORE STONE COMPANY, INC.,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Assistant Secretary
82
BMC TRUCKING, INC.,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Assistant Secretary
ELLEN JAY, INC.,
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President and Secretary
STONE MATERIALS COMPANY, LLC
by: Better Minerals and Aggregates Company,
as Manager
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President, General Counsel and
Assistant Secretary
of Better Minerals & Aggregates Company
COMMERCIAL STONE CO., INC.
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Secretary
83
COMMERCIAL AGGREGATES
TRANSPORTATON AND SALES, LLC
by: Stone Materials Company, LLC, as Manager
by /s/ John A. Ulizio
----------------------------------------------
Name: John A. Ulizio
Title: Vice President, General Counsel and
Assistant Secretary
of Better Minerals & Aggregates Company,
Manager of Stone Materials Company, LLC, as
Manager
THE BANK OF NEW YORK, as Trustee
by /s/ Mary Beth Lewicki
-------------------------------
Name: Mary Beth Lewicki
Title: Vice President
APPENDIX A
PROVISIONS RELATING TO INITIAL SECURITIES,
------------------------------------------
PRIVATE EXCHANGE SECURITIES
---------------------------
AND EXCHANGE SECURITIES
-----------------------
1. Definitions
-----------
1.1 Definitions
-----------
For the purposes of this Appendix A the following terms shall have the
meanings indicated below:
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Regulation S Global Security or beneficial interest
therein, the rules and procedures of the Depositary for such Global Security,
Euroclear and Cedel, in each case to the extent applicable to such transaction
and as in effect from time to time.
"Cedel" means Cedel Bank, S.A., or any successor securities clearing
agency.
"Definitive Security" means a certificated Initial Security, Private
Exchange Security or Exchange Security (bearing the Restricted Securities Legend
if the transfer of such Security is restricted by applicable law) that does not
include the Global Securities Legend.
"Depositary" means The Depository Trust Company, its nominees and
their respective successors.
"Euroclear" means the Euroclear Clearance System or any successor
securities clearing agency.
"Global Securities Legend" means the legend set forth under that
caption in Exhibit A to this Indenture.
"IAI" means an institutional "accredited investor" as described in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
"Initial Purchasers" means Chase Securities Inc. and BNP Capital
Markets, LLC.
"Private Exchange" means an offer by the Company, pursuant to the
Registration Agreement, to issue and deliver to certain purchasers, in exchange
for the Initial Securities held by such purchasers as part of their initial
distribution, a like aggregate principal amount of Private Exchange Securities.
2
"Private Exchange Securities" means the Securities of the Company
issued in exchange for Initial Securities pursuant to this Indenture in
connection with the Private Exchange pursuant to the Registration Agreement.
"Purchase Agreement" means the Purchase Agreement dated September 28,
1999, among the Company, the Existing Guarantors (as defined therein) and the
Initial Purchasers, as amended by the Purchase Agreement Amendment dated October
1, 1999, among the Company, the Note 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 Agreement, to certain Holders of Initial Securities, to
issue and deliver to such Holders, in exchange for their Initial Securities, a
like aggregate principal amount of Exchange Securities registered under the
Securities Act.
"Registration Agreement" means the Exchange and Registration Rights
Agreement dated October 1, 1999, among the Company, the Note Guarantors and the
Initial Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Securities" means all Initial Securities offered and
sold outside the United States in reliance on Regulation S.
"Restricted Period", with respect to any Securities, means the period
of 40 consecutive days beginning on and including the later of (a) the day on
which such Securities are first offered to persons other than distributors (as
defined in Regulation S under the Securities Act) in reliance on Regulation S,
notice of which day shall be promptly given by the Company to the Trustee, and
(b) the Issue Date with respect to such Securities.
"Restricted Securities Legend" means the legend set forth in Section
2.3(e)(i) herein.
"Rule 501" means Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Securities" means all Initial Securities offered and sold
to QIBs in reliance on Rule 144A.
"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, who
shall initially be the Trustee.
3
"Shelf Registration Statement" means a registration statement filed by
the Company in connection with the offer and sale of Initial Securities pursuant
to the Registration Agreement.
"Transfer Restricted Securities" means Definitive Securities and any
other Securities that bear or are required to bear the Restricted Securities
Legend.
1.2 Other Definitions
-----------------
Term: Defined in Section:
---- ------------------
"Agent Members"....................................... 2.1(c)
"IAI Global Security"................................. 2.1(b)
"Global Security"..................................... 2.1(b)
"Regulation S Global Security"........................ 2.1(b)
"Rule 144A Global Security"........................... 2.1(b)
2. The Securities
--------------
2.1 Form and Dating
---------------
(a) The Initial Securities issued on the date hereof will be (i)
offered and sold by the Company pursuant to the Purchase Agreement and (ii)
resold, initially only to (1) QIBs in reliance on Rule 144A and (2) Persons
other than U.S. Persons (as defined in Regulation S) in reliance on Regulation
S. Such Initial Securities may thereafter be transferred to, among others,
QIBs, purchasers in reliance on Regulation S and, except as set forth below,
IAIs in accordance with Rule 501.
(b) Global Securities. Rule 144A Securities shall be issued
------------------
initially in the form of one or more permanent global Securities in definitive,
fully registered form (collectively, the "Rule 144A Global Security") and
Regulation S Securities shall be issued initially in the form of one or more
global Securities (collectively, the "Regulation S Global Security"), in each
case without interest coupons and bearing the Global Securities Legend and
Restricted Securities Legend, which shall be deposited on behalf of the
purchasers of the Securities represented thereby with the Securities Custodian,
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 provided in
this Indenture. One or more global securities in definitive, fully registered
form without interest coupons and bearing the Global Securities Legend and the
Restricted Securities Legend (collectively, the "IAI Global Security") shall
also be issued on the Closing Date, deposited with the Securities Custodian, 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 provided in this
Indenture to accommodate transfers of beneficial interests in the Securities to
IAIs subsequent to the initial distribution. Beneficial ownership interests in
the Regulation S Global Security shall not be exchangeable for interests in the
Rule 144A Global Security, the IAI Global Security or
4
any other Security without a Restricted Securities Legend until the expiration
of the Restricted Period. The Rule 144A Global Security, the IAI Global Security
and the Regulation S Global Security are each referred to herein as a "Global
Security" and are collectively referred to herein as "Global Securities",
provided, that the term "Global Security" when used in Sections 2.1(b)(third
- --------
paragraph), 2.1(c), 2.3(g)(i), 2.3(h)(i) and 2.4 shall also include any Security
in global form issued in connection with a Registered Exchange Offer or Private
Exchange. 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 and on the schedules thereto as
hereinafter provided.
(c) Book-Entry Provisions. This Section 2.1(c) 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(c) and Section 2.2 and pursuant to an order of the Company
signed by two Officers, authenticate and deliver initially one or more Global
Securities that (i) shall be registered in the name of the Depositary for such
Global Security or Global Securities or the nominee of such Depositary and (ii)
shall be delivered by the Trustee to such Depositary or pursuant to such
Depositary's instructions or held by the Trustee as Securities Custodian.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary or by the Trustee as Securities Custodian 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.
(d) Definitive Securities. Except as provided in Section 2.3 or 2.4,
----------------------
owners of beneficial interests in Global Securities will not be entitled to
receive physical delivery of certificated Securities.
2.2 Authentication. The Trustee shall authenticate and make available for
---------------
delivery upon a written order of the Company signed by two Officers (a) Initial
Securities for original issue on the date hereof in an aggregate principal
amount of $150,000,000 and (b) the (i) Exchange Securities for issue only in a
Registered Exchange Offer and (ii) Private Exchange Securities for issue only in
the Private Exchange, in the case of each of (i) and (ii) pursuant to the
Registration Agreement and for a like principal amount of Initial Securities
exchanged pursuant thereto. Such order shall specify the amount of the
Securities to be authenticated, 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. The aggregate
principal amount
5
of Securities outstanding at any time may not exceed $150,000,000 except as
provided in Sections 2.07 and 2.08 of this Indenture.
2.3 Transfer and Exchange. (a) Transfer and Exchange of Definitive
---------------------- -----------------------------------
Securities. When Definitive Securities are presented to the Registrar with a
- -----------
request:
(i) to register the transfer of such Definitive Securities; or
(ii) to exchange such Definitive Securities for an equal
principal amount of Definitive Securities of other authorized
denominations, the Registrar shall register the transfer or make the
exchange as requested if its reasonable requirements for such transaction
are met; provided, however, that the Definitive Securities surrendered for
-------- -------
transfer or exchange:
(1) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company and
the Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing; and
(2) in the case of Transfer Restricted Securities, are
accompanied by the following additional information and documents, as
applicable:
(A) if such Definitive Securities are being delivered to
the Registrar by a Holder for registration in the name of such Holder,
without transfer, a certification from such Holder to that effect (in
the form set forth on the reverse side of the Initial Security); or
(B) if such Definitive Securities are being transferred to
the Company, a certification to that effect (in the form set forth on
the reverse side of the Initial Security); or
(C) if such Definitive Securities are being transferred
pursuant to an exemption from registration in accordance with Rule 144
under the Securities Act or in reliance upon another exemption from
the registration requirements of the Securities Act, (x) a
certification to that effect (in the form set forth on the reverse
side of the Initial Security) and (y) if the Company so requests, an
opinion of counsel or other evidence reasonably satisfactory to it as
to the compliance with the restrictions set forth in the legend set
forth in Section 2.3(e)(i).
(b) Restrictions on Transfer of a Definitive Security for a
-------------------------------------------------------
Beneficial Interest in a Global Security. A Definitive Security may not be
- -----------------------------------------
exchanged for a beneficial interest in a Global Security except upon
satisfaction of the requirements set forth below. Upon receipt by the Trustee
of a Definitive Security, duly endorsed or accompanied by a written instrument
of transfer in form reasonably satisfactory to the Company and the Registrar,
together with:
6
(i) certification (in the form set forth on the reverse side of the
Initial Security) that such Definitive Security is being transferred (1) to
a QIB in accordance with Rule 144A, (2) to an IAI that has furnished to the
Trustee a signed letter substantially in the form of Exhibit D or (3)
outside the United States in an offshore transaction within the meaning of
Regulation S and in compliance with Rule 904 under the Securities Act; and
(ii) written instructions directing the Trustee to make, or to direct
the Securities Custodian to make, an adjustment on its books and records
with respect to such Global Security to reflect an increase in the
aggregate principal amount of the Securities represented by the Global
Security, such instructions to contain information regarding the Depositary
account to be credited with such increase, then the Trustee shall cancel
such Definitive Security and cause, or direct the Securities Custodian to
cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Securities Custodian, the aggregate
principal amount of Securities represented by the Global Security to be
increased by the aggregate principal amount of the Definitive Security to
be exchanged and shall credit or cause to be credited to the account of the
Person specified in such instructions a beneficial interest in the Global
Security equal to the principal amount of the Definitive Security so
canceled. If no Global Securities are then outstanding and the Global
Security has not been previously exchanged for certificated securities
pursuant to Section 2.4, the Company shall issue and the Trustee shall
authenticate, upon written order of the Company in the form of an Officers'
Certificate, a new Global Security in the appropriate principal amount.
(c) 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 this 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 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 such Global Security or
another Global Security and such account shall be credited in accordance with
such order with a beneficial interest in the applicable Global Security and the
account of the Person making the transfer shall be debited by an amount equal to
the beneficial interest in the Global Security being transferred. Transfers by
an owner of a beneficial interest in the Rule 144A Global Security or the IAI
Global Security to a transferee who takes delivery of such interest through the
Regulation S Global Security, whether before or after the expiration of the
Restricted Period, shall be made only upon receipt by the Trustee of a
certification in the form provided on the reverse of the Initial Securities from
the transferor to the effect that such transfer is being made in accordance with
Regulation S or (if available) Rule 144 under the Securities Act and that, if
such transfer is being made prior to the expiration of the Restricted Period,
the interest transferred shall be held immediately thereafter through Euroclear
or Cedel. In the case of a transfer of a beneficial interest in either the
Regulation S Global Security or the Rule 144A Global Security for an interest in
the IAI Global Security, the transferee must furnish a signed letter
substantially in the form of Exhibit D to the Trustee.
7
(ii) If the proposed transfer is a transfer of a beneficial interest
in one Global Security to a beneficial interest in another Global Security,
the Registrar shall reflect on its books and records the date and an
increase in the principal amount of the Global Security to which such
interest is being transferred in an amount equal to the principal amount of
the interest to be so transferred, and the Registrar shall reflect on its
books and records the date and a corresponding decrease in the principal
amount of Global Security from which such interest is being transferred.
(iii) 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 or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(iv) In the event that a Global Security is exchanged for Definitive
Securities pursuant to Section 2.4 prior to the consummation of the
Registered Exchange Offer or the effectiveness of the 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, Regulation S or such
other applicable exemption from registration under the Securities Act, as
the case may be) and such other procedures as may from time to time be
adopted by the Company.
(d) Restrictions on Transfer of Regulation S Global Security. (i)
---------------------------------------------------------
Prior to the expiration of the Restricted Period, interests in the Regulation S
Global Security may only be held through Euroclear or Cedel. During the
Restricted Period, beneficial ownership interests in the Regulation S Global
Security may only be sold, pledged or transferred through Euroclear or Cedel in
accordance with the Applicable Procedures and only (1) to the Company, (2) so
long as such security is eligible for resale pursuant to Rule 144A, to a person
whom the selling holder reasonably believes is a QIB that purchases for its own
account or for the account of a QIB to whom notice is given that the resale,
pledge or transfer is being made in reliance on Rule 144A, (3) in an offshore
transaction in accordance with Regulation S, (4) pursuant to an exemption from
registration under the Securities Act provided by Rule 144 (if applicable) under
the Securities Act, (5) to an IAI purchasing for its own account, or for the
account of such an IAI, in a minimum principal amount of Securities of $250,000
or (6) pursuant to an effective registration statement under the Securities Act,
in each case in accordance with any applicable securities laws of any state of
the United States. Prior to the expiration of the Restricted Period, transfers
by an owner of a beneficial interest in the Regulation S Global Security to a
transferee who takes delivery of such interest through the Rule 144A Global
Security or the IAI Global Security shall be made only in accordance with
Applicable Procedures and upon receipt by the Trustee of a written certification
from the transferor of the beneficial interest in the form provided on the
reverse of the Initial Security to the effect that such transfer is being made
to (1) a QIB within the meaning of Rule 144A in a transaction meeting the
requirements of Rule 144A or (2) an IAI
8
purchasing for its own account, or for the account of such an IAI, in a minimum
principal amount of the Securities of $250,000. Such written certification shall
no longer be required after the expiration of the Restricted Period. In the case
of a transfer of a beneficial interest in the Regulation S Global Security for
an interest in the IAI Global Security, the transferee must furnish a signed
letter substantially in the form of Exhibit D to the Trustee.
(ii) Upon the expiration of the Restricted Period, beneficial
ownership interests in the Regulation S Global Security shall be
transferable in accordance with applicable law and the other terms of this
Indenture.
(e) Legend.
------
(i) Except as permitted by the following paragraphs (ii), (iii) or
(iv), each Security certificate evidencing the Global Securities and the
Definitive Securities (and all Securities issued in exchange therefor or in
substitution thereof) shall bear a legend in substantially the following
form (each defined term in the legend being defined as such for purposes of
the legend only):
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR
OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE
9
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN
EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (F)
PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE."
Each Definitive Security shall bear the following additional legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR
AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER
AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS."
(ii) Upon any sale or transfer of a Transfer Restricted Security that
is a Definitive Security, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a Definitive Security that
does not bear the legends 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 Initial 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 the
Restricted Securities Legend on such Initial Securities or such Private
Exchange Securities shall cease to apply and the requirements that any such
Initial Securities or such Private Exchange Securities be issued in global
form shall continue to apply.
(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 Initial Securities that Initial
Securities be issued in global form shall continue to apply, and Exchange
Securities in global form without the Restricted Securities Legend shall
be
10
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 be issued in global form shall continue to apply, and
Private Exchange Securities in global form with the Restricted Securities
Legend shall be available to Holders that exchange such Initial Securities
in such Private Exchange.
(vi) Upon a sale or transfer after the expiration of the Restricted
Period of any Initial Security acquired pursuant to Regulation S, all
requirements that such Initial Security bear the Restricted Securities
Legend shall cease to apply and the requirements requiring any such Initial
Security be issued in global form shall continue to apply.
(f) Cancelation or Adjustment of Global Security. At such time as
---------------------------------------------
all beneficial interests in a Global Security have either been exchanged for
Definitive Securities, transferred, redeemed, repurchased or canceled, such
Global Security shall be returned by the Depositary to the Trustee for
cancelation or retained and canceled by the Trustee. At any time prior to such
cancelation, if any beneficial interest in a Global Security is exchanged for
Definitive Securities, transferred in exchange for an interest in another Global
Security, 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
Custodian for such Global Security) with respect to such Global Security, by the
Trustee or the Securities Custodian, to reflect such reduction.
(g) 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, Definitive Securities and
Global Securities at the 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 exchanges pursuant to Sections
2.06, 3.06, 4.06, 4.08 and 9.05 of this Indenture).
(iii) Prior to the due presentation for registration of transfer of
any Security, the Company, the Trustee, the Paying Agent or the 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
11
Company, the Trustee, the Paying Agent or the Registrar shall be affected
by notice to the contrary.
(iv) All Securities issued upon any transfer or exchange pursuant to
the terms of this Indenture shall evidence the same debt and shall be
entitled to the same benefits under this Indenture as the Securities
surrendered upon such transfer or exchange.
(h) 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 any 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 repurchase) 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 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 this 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 this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
2.4 Definitive Securities
---------------------
(a) A Global Security deposited with the Depositary or with the
Trustee as Securities Custodian pursuant to Section 2.1 or issued in connection
with a Registered Exchange Offer or Private Exchange shall be transferred to the
beneficial owners thereof in the form of Definitive 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 a Depositary for such Global Security or if at any time the
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 after the Company becomes aware of such cessation, or (ii) an
Event of Default has occurred and is continuing or (iii) the Company, in its
sole
12
discretion, notifies the Trustee in writing that it elects to cause the issuance
of certificated Securities under this Indenture.
(b) Any Global Security that is transferable to the beneficial owners
thereof pursuant to this Section 2.4 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 Definitive 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 in the form of a Definitive Security delivered
in exchange for an interest in the Global Security shall, except as otherwise
provided by Section 2.3(e), bear the Restricted Securities Legend.
(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 this
Indenture or the Securities.
(d) In the event of the occurrence of any of the events specified in
Section 2.4(a)(i), (ii) or (iii), the Company will promptly make available to
the Trustee a reasonable supply of Definitive Securities in fully registered
form without interest coupons.
EXHIBIT A
[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 DTC, 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 SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT
2
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS
AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION
S UNDER THE SECURITIES ACT, (E) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING
OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM.
THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.
Each Definitive Security shall bear the following additional legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
No. $__________
13% Senior Subordinated Note due 2009
CUSIP No. ______
[ISIN No. _______]
BETTER MINERALS & AGGREGATES COMPANY, a Delaware corporation, promises
to pay to [Cede & Co.], or registered assigns, the principal sum [of Dollars]
[listed on the Schedule of Increases or Decreases in Global Security attached
hereto] on [ ], [ ].
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
2
Additional provisions of this Security are set forth on the other side
of this Security.
IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.
BETTER MINERALS & AGGREGATES COMPANY,
by
_________________________________
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK,
as Trustee, certifies
that this is one of the
Securities referred to in the
within-mentioned Indenture.
By:___________________________
Authorized Signatory
* If the Security is to be issued in global form, add the Global Securities
Legend and the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL
SECURITIES B SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".
[FORM OF REVERSE SIDE OF INITIAL SECURITY
AND PRIVATE EXCHANGE SECURITY]
13% Senior Subordinated Note due 2009
1. Interest
--------
(a) BETTER MINERALS & AGGREGATES COMPANY, a Delaware 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. The Company shall pay interest semiannually on March 15 and September 15
of each year. Interest on the Securities shall accrue from the most recent date
to which interest has been paid or duly provided for or, if no interest has been
paid or duly provided for, from October 1, 1999 until the principal hereof is
due. Interest shall be computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay interest on overdue principal at the rate borne by
the Securities plus 1% per annum, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
(b) Liquidated Damages. The holder of this Security is entitled to
------------------
the benefits of an Exchange and Registration Rights Agreement, dated as of
October 1, 1999, among the Company, U.S. SILICA COMPANY, BETTER MATERIALS
CORPORATION, GEORGE F. PETTINOS, INC., OTTAWA SILICA COMPANY, THE FULTON LAND
AND TIMBER COMPANY, PENNSYLVANIA GLASS SAND CORPORATION, BUCKS COUNTY CRUSHED
STONE COMPANY, CHIPPEWA FARMS CORPORATION, SHORE STONE COMPANY, INC., BMC
TRUCKING, INC., ELLEN JAY, INC., STONE MATERIALS COMPANY, LLC, COMMERCIAL STONE
CO., INC. and COMMERCIAL AGGREGATES TRANSPORTATION AND SALES, LLC (the "Note
Guarantors") and the Initial Purchasers named therein (the "Registration
Agreement"). Capitalized terms used in this paragraph (b) but not defined
herein have the meanings assigned to them in the Registration Agreement. If (i)
the Shelf Registration Statement or Exchange Offer Registration Statement, as
applicable under the Registration Agreement, is not filed with the Commission on
or prior to 135 days after the Issue Date, (ii) the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, is not
declared effective within 195 days after the Issue Date, (iii) the Registered
Exchange Offer is not consummated on or prior to 240 days after the Issue Date,
or (iv) the Shelf Registration Statement is filed and declared effective within
195 days after the Issue Date but shall thereafter cease to be effective (at any
time that the Company is obligated to maintain the effectiveness thereof)
without being succeeded within 45 days by an additional Registration Statement
filed and declared effective (each such event referred to in clauses (i) through
(iv), a "Registration Default"), the Company shall pay liquidated damages to
each holder of Transfer Restricted Securities, during the period of such
Registration Default, in an amount equal to $0.192 per week per $1,000 principal
amount of the Securities constituting Transfer Restricted Securities held by
such holder until the applicable Registration Statement is filed or declared
effective, the Registered Exchange Offer is consummated or the Shelf
Registration Statement again becomes effective, as the case may be. All accrued
liquidated damages shall be paid to
2
holders in the same manner as interest payments on the Securities on semi-annual
payment dates which correspond to interest payment dates for the Securities.
Following the cure of all Registration Defaults, the accrual of liquidated
damages shall cease. The Trustee shall have no responsibility with respect to
the determination of the amount of any such liquidated damages. For purposes of
the foregoing, "Transfer Restricted Securities" means (i) each Initial Security
until the date on which such Initial Security has been exchanged for a freely
transferable Exchange Security in the Registered Exchange Offer, (ii) each
Initial Security or Private Exchange Security until the date on which such
Initial Security or Private Exchange Security has been effectively registered
under the Securities Act and disposed of in accordance with a Shelf Registration
Statement or (iii) each Initial Security or Private Exchange Security until the
date on which such Initial Security or Private Exchange Security is distributed
to the public pursuant to Rule 144 under the Securities Act or is saleable
pursuant to Rule 144(k) under the Securities Act.
2. Method of Payment
-----------------
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the March 1 or September 1 next preceding the interest payment
date even if Securities are canceled 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 shall pay principal, premium,
liquidated damages, if any, and interest in money of the United States of
America that at the time of payment is legal tender for payment of public and
private debts. Payments in respect of the Securities represented by a Global
Security (including principal, premium, liquidated damages, if any, and
interest) shall be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company. The Company will make all
payments in respect of a certificated Security (including principal, premium and
interest), and the Securities may be exchanged or transferred, at the office or
agency of the Company in the Borough of Manhattan, The City of New York (which
initially shall be the Corporate Trust Office of the Trustee, at 101 Barclay
Street, New York, New York 10286), except that, at the option of the Company,
payment of interest may be made by check mailed directly to Holders at their
registered addresses; provided, however, that payments on the Securities may
-------- -------
also be made, in the case of a Holder of at least $1,000,000 aggregate principal
amount of Securities, by wire transfer to a U.S. dollar account maintained by
the payee with a bank in the United States if such Holder elects payment by wire
transfer by giving written notice to the Trustee or the Paying Agent to such
effect designating such account no later than 30 days immediately preceding the
relevant due date for payment (or such other date as the Trustee may accept in
its discretion).
3. Paying Agent and Registrar
--------------------------
Initially, THE BANK OF NEW YORK, 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. The Company
or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co-registrar.
3
4. Indenture
---------
The Company issued the Securities under an Indenture dated as of
October 1, 1999 (the "Indenture"), among the Company, the Note 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. " 77aaa-77bbbb) as in effect on the date of the Indenture (the
------
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all terms and
provisions of the Indenture, and Holders (as defined in the Indenture) are
referred to the Indenture and the TIA for a statement of such terms and
provisions.
The Securities are senior subordinated unsecured obligations of the
Company limited to $150,000,000 aggregate principal amount at any one time
outstanding (subject to Section 2.07 of the Indenture). This Security is one of
the [Initial] [Private Exchange] Securities referred to in the Indenture issued
in an aggregate principal amount of $150,000,000. The Securities include the
Initial Securities and any Exchange Securities and Private Exchange Securities
issued in exchange for Initial Securities. The Initial Securities, the Exchange
Securities and the Private Exchange Securities are treated as a single class of
securities under the Indenture. The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, make certain Investments and other Restricted Payments, pay dividends
and other distributions, incur Indebtedness, enter into consensual restrictions
upon the payment of certain dividends and distributions by such Restricted
Subsidiaries, issue or sell shares of capital stock of such Restricted
Subsidiaries, enter into or permit certain transactions with Affiliates, and
make asset sales. The Indenture also imposes limitations on the ability of the
Company to consolidate or merge with or into any other Person or convey,
transfer or lease all or substantially all of the property of the Company.
To guarantee the due and punctual payment of the principal and
interest 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 Note Guarantors have jointly and severally
unconditionally guaranteed the Guaranteed Obligations on a senior subordinated
basis pursuant to the terms of the Indenture.
5. Optional Redemption
-------------------
Except as set forth in the following paragraph, the Securities shall
not be redeemable at the option of the Company prior to September 15, 2004.
Thereafter, the Securities shall be redeemable at the option of the Company, in
whole or in part, on not less than 30 nor more than 60 days prior notice, at the
following redemption prices (expressed as percentages of principal amount), plus
accrued and unpaid interest and liquidated damages, if any, to the redemption
date (subject to the right of holders of record on the relevant record date to
receive interest due on the relevant interest payment date), if redeemed during
the 12-month period commencing on September 15 of the years set forth below:
4
Year Redemption
Price
--------------------------------------------------------
2004 106.500%
2005 104.333%
2006 102.167%
2007 and thereafter 100.000%
In addition, prior to September 15, 2002, the Company may redeem up to
a maximum of 35% of the original aggregate principal amount of the Securities
with the Net Cash Proceeds of one or more Public Equity Offerings (i) by the
Company or (ii) by Parent or Holdings to the extent the Net Cash Proceeds
thereof are contributed to the Company or used to purchase Capital Stock (other
than Disqualified Stock) of the Company from the Company following which there
is a Public Market, at a redemption price equal to 113% of the principal amount
thereof, plus accrued and unpaid interest and liquidated damages thereon, if
any, to the redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on the relevant interest payment
date); provided, however, that after giving effect to any such redemption, at
-------- -------
least 65% of the original aggregate principal amount of the Securities remains
outstanding. Any such redemption shall be made within 90 days of such Public
Equity Offering upon not less than 30 nor more than 60 days notice mailed to
each holder of Securities being redeemed and otherwise in accordance with the
procedures set forth in the Indenture.
6. Sinking Fund
------------
The Securities are not subject to any sinking fund.
7. Notice of Redemption
--------------------
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his or her registered address. Securities in
denominations 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 and liquidated damages, if any, 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.
8. Repurchase of Securities at the Option of Holders upon Change of Control
------------------------------------------------------------------------
Upon a Change of Control, any Holder of Securities will have the
right, subject to certain conditions specified in the Indenture, to cause the
Company to repurchase all or any part of the Securities of such Holder at a
purchase price equal to 101% of the principal amount of the Securities to be
repurchased plus accrued and unpaid interest and liquidated damages, if any, to
5
the date of repurchase (subject to the right of Holders of record on the
relevant record date to receive interest due on the relevant interest payment
date that is on or prior to the date of purchase) as provided in, and subject to
the terms of, the Indenture.
In accordance with Section 4.06 of the Indenture, the Company will be
required to offer to purchase Securities upon the occurrence of certain events.
9. Subordination
-------------
The Securities are subordinated to Senior Indebtedness, as defined in
the Indenture. To the extent provided in the Indenture, Senior Indebtedness
must be paid before the Securities may be paid. The Company and each Note
Guarantor agrees, and each Holder by accepting a Security agrees, to the
subordination provisions contained in the Indenture and authorizes the Trustee
to give it effect and appoints the Trustee as attorney-in-fact for such purpose.
10. Denominations; Transfer; Exchange
---------------------------------
The Securities are in registered form without coupons in denominations
of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. Upon any transfer or exchange, the
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange 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)
or to transfer or exchange any Securities for a period of 15 days prior to a
selection of Securities to be redeemed.
11. Persons Deemed Owners
---------------------
Except as provided in paragraph 2 hereof, the registered Holder of
this Security may be treated as the owner of it for all purposes.
12. Unclaimed Money
---------------
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its written 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.
13. Discharge and Defeasance
------------------------
Subject to certain conditions, the Company at any time may terminate
some of or all its obligations under the Securities and the Indenture if the
Company deposits with the
6
Trustee money or U.S. Government Obligations for the payment of principal and
interest on the Securities to redemption or maturity, as the case may be.
14. Amendment, Waiver
-----------------
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any Holder
but with the written consent of the Holders of at least a majority in aggregate
principal amount of the outstanding Securities and (ii) any default may be
waived with the written consent of the Holders of at least a majority in
principal amount of the outstanding Securities. Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder of Securities, the
Company and the Trustee may amend the Indenture or the Securities (i) to cure
any ambiguity, omission, defect or inconsistency; (ii) to comply with Article 5
of the Indenture; (iii) to provide for uncertificated Securities in addition to
or in place of certificated Securities; (iv) to add Note Guarantees with respect
to the Securities; (v) to secure the Securities; (vi) to add additional
covenants or to surrender rights and powers conferred on the Company; (vii) to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA; (viii) to make any change that
does not adversely affect the rights of any Holder; (ix) to make any change in
the subordination provisions of the Indenture that would limit or terminate the
benefits available to any holder of Senior Indebtedness of the Company (or any
representative thereof) under such subordination provisions; or (x) to provide
for the issuance of the Exchange Securities or Private Exchange Securities.
15. Defaults and Remedies
---------------------
If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company)
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the outstanding Securities may declare the principal of and accrued
but unpaid interest on all the Securities to be due and payable. If an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization
of the Company occurs, the principal of and interest on all the Securities shall
become immediately due and payable without any declaration or other act on the
part of the Trustee or any Holders. Under certain circumstances, the Holders of
a majority in principal amount of the outstanding Securities may rescind any
such acceleration with respect to the Securities and its consequences.
If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to a Responsible Officer of the Trustee reasonable indemnity or security
reasonably satisfactory to the Trustee against any loss, liability or expense
and certain other conditions are complied with. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Holder
may pursue any remedy with respect to the Indenture or the Securities unless (i)
such Holder has previously given the Trustee notice that an Event of Default is
continuing, (ii) Holders of at least 25% in principal
7
amount of the outstanding Securities have requested the Trustee in writing to
pursue the remedy, (iii) such Holders have offered the Trustee reasonable
security or indemnity reasonably satisfactory to the Trustee against any loss,
liability or expense, (iv) the Trustee has not complied with such request within
60 days after the receipt of the request and the offer of security or indemnity
and (v) the Holders of a majority in principal amount of the outstanding
Securities have not given the Trustee a direction inconsistent with such request
within such 60-day period. Subject to certain restrictions, the Holders of a
majority in principal amount of the outstanding Securities are given the right
to 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. The Trustee, however, may refuse to follow any direction that conflicts
with law or the Indenture or that the Trustee determines is unduly prejudicial
to the rights of any other Holder or that would involve the Trustee in personal
liability. Prior to taking any action under the Indenture, the Trustee shall be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
16. Trustee Dealings with the Company
---------------------------------
Subject to certain limitations imposed by the TIA, 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.
17. No Recourse Against Others
--------------------------
A director, officer, employee or stockholder, as such, of the Company
or any Note Guarantor shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Holder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
18. Authentication
--------------
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
19. Abbreviations
-------------
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
8
20. 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.
21. CUSIP and ISIN Numbers
----------------------
The Company has caused CUSIP [and ISIN] numbers to be printed on the
Securities and has directed the Trustee to use CUSIP [and ISIN] numbers in
notices of redemption as a convenience to Holders. No representation is made as
to the accuracy of such numbers either as printed on the Securities or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder of Securities upon written
request and without charge to the Holder a copy of the Indenture which has in it
the text of this Security.
9
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: _____________________
____________________________________________________________
Sign exactly as your name appears on the other side of this Security.
10
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER
RESTRICTED SECURITIES
This certificate relates to $_________ principal amount of Securities held in
(check applicable space) ____ book-entry or _____ definitive form by the
undersigned.
The undersigned (check one box below):
[_] has requested the Trustee by written order to deliver in exchange for its
beneficial interest in the Global Security held by the Depositary a
Security or Securities in definitive, registered form of authorized
denominations and an aggregate principal amount equal to its beneficial
interest in such Global Security (or the portion thereof indicated above);
[_] has requested the Trustee by written order to exchange or register the
transfer of a Security or Securities.
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Securities Act, the undersigned confirms that such Securities
are being transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1) [_] to the Company; or
(2) [_] to the Registrar for registration in the name of the Holder,
without transfer; or
(3) [_] pursuant to an effective registration statement under the
Securities Act of 1933; or
(4) [_] 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
(5) [_] 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 and such Security
shall be held immediately after the transfer through Euroclear
and Cedel until the expiration of the Restricted Period (as
defined in the Indenture); or
11
(6) [_] to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933) that
has furnished to the Trustee a signed letter containing certain
representations and agreements; or
(7) [_] 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
-------- -------
(5), (6) or (7) 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.
________________________
Your Signature
Signature Guarantee:
Date: __________________________ __________________________
Signature must be guaranteed Signature of Signature
by a participant in a Guarantee
recognized signature guaranty
medallion program or other
signature guarantor acceptable
to the Trustee
____________________________________________________________
TO BE COMPLETED BY PURCHASER IF (4) 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
12
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
13
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The initial principal amount of this Global Security is $[ ].
The following increases or decreases in this Global Security have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of
Exchange Principal Amount of Principal Amount of this Global Security authorized signatory
this Global Security Global Security following such decrease of Trustee or
or increase Securities Custodian
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 (Asset Disposition) or 4.08 (Change of Control) of the
Indenture, check the box:
Asset Disposition [_] Change of Control [_]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.06 or 4.08 of the Indenture, state the amount
($1,000 or an integral multiple thereof):
$
Date: __________________ Your Signature: __________________________________
(Sign exactly as your name appears
on the other side of the Security)
Signature Guarantee:_______________________________________________
Signature must be guaranteed by a participant
in a recognized signature guaranty medallion
program or other signature guarantor acceptable
to the Trustee.
EXHIBIT B
[FORM OF FACE OF EXCHANGE 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 DTC, 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.
2
No. $__________
13% Senior Subordinated Note due 2009
CUSIP No. ______
[ISIN No. ______ ]
BETTER MINERALS & AGGREGATES COMPANY, a Delaware corporation, promises
to pay to [Cede & Co.], or registered assigns, the principal sum [of
Dollars] [listed on the Schedule of Increases or Decreases in Global Security
attached hereto] on [ ], [ ].
Interest Payment Dates: March 15 and September 15.
Record Dates: March 1 and September 1.
3
Additional provisions of this Security are set forth on the other side
of this Security.
IN WITNESS WHEREOF, the parties have caused this instrument to be duly
executed.
BETTER MINERALS & AGGREGATES COMPANY,
by
_____________________________________
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK,
as Trustee, certifies
that this is one of the
Securities referred to in the
within-mentioned Indenture.
by
_____________________________
Authorized Signatory
* If the Security is to be issued in global form, add the Global Securities
Legend and the attachment from Exhibit A captioned "TO BE ATTACHED TO GLOBAL
SECURITIES B SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY".
4
[FORM OF REVERSE SIDE OF EXCHANGE SECURITY]
13% Senior Subordinated Note due 2009
1. Interest.
--------
BETTER MINERALS & AGGREGATES COMPANY, a Delaware 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. The Company
shall pay interest semiannually on March 15 and September 15 of each year.
Interest on the Securities shall accrue from the most recent date to which
interest has been paid or duly provided for or, if no interest has been paid or
duly provided for, from October 1, 1999 until the principal hereof is due.
Interest shall be computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay interest on overdue principal at the rate borne by
the Securities plus 1% per annum, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
2. Method of Payment
-----------------
The Company shall pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the March 1 or September 1 next preceding the interest payment
date even if Securities are canceled 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 shall pay principal, premium and
interest in money of the United States of America that at the time of payment is
legal tender for payment of public and private debts. Payments in respect of the
Securities represented by a Global Security (including principal, premium and
interest) shall be made by wire transfer of immediately available funds to the
accounts specified by The Depository Trust Company. The Company will make all
payments in respect of a certificated Security (including principal, premium and
interest), by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on the Securities may also be made, in the case
- -------- -------
of a Holder of at least $1,000,000 aggregate principal amount of Securities, by
wire transfer to a U.S. dollar account maintained by the payee with a bank in
the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating
such account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its discretion).
3. Paying Agent and Registrar
--------------------------
Initially, THE BANK OF NEW YORK, 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. The Company
or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co-registrar.
5
4. Indenture
---------
The Company issued the Securities under an Indenture dated as of
October 1, 1999 (the "Indenture"), among the Company, the Note 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." 77aaa-77bbbb) as in effect on the date of the Indenture (the
------
"TIA"). Terms defined in the Indenture and not defined herein have the meanings
ascribed thereto in the Indenture. The Securities are subject to all terms and
provisions of the Indenture, and Holders (as defined in the Indenture) are
referred to the Indenture and the TIA for a statement of such terms and
provisions.
The Securities are senior subordinated unsecured obligations of the
Company limited to $150,000,000 aggregate principal amount at any one time
outstanding, of which $150,000,000 in aggregate principal amount will be
initially issued on the Closing Date. This Security is one of the Exchange
Securities referred to in the Indenture. The Securities include the Initial
Securities and any Exchange Securities and Private Exchange Securities issued in
exchange for the Initial Securities pursuant to the Indenture. The Initial
Securities, the Exchange Securities and the Private Exchange Securities are
treated as a single class of securities under the Indenture. The Indenture
imposes certain limitations on the ability of the Company and its Restricted
Subsidiaries to, among other things, make certain Investments and other
Restricted Payments, pay dividends and other distributions, incur Indebtedness,
enter into consensual restrictions upon the payment of certain dividends and
distributions by such Restricted Subsidiaries, issue or sell shares of capital
stock of such Restricted Subsidiaries, enter into or permit certain transactions
with Affiliates and make Asset Sales. The Indenture also imposes limitations on
the ability of the Company to consolidate or merge with or into any other Person
or convey, transfer or lease all or substantially all of the property of the
Company.
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 Note Guarantors have, jointly and
severally, unconditionally guaranteed the Guaranteed Obligations on a senior
basis subordinated basis pursuant to the terms of the Indenture.
5. Optional Redemption
-------------------
Except as set forth in the following paragraph, the Securities shall
not be redeemable at the option of the Company prior to September 15, 2004.
Thereafter, the Securities shall be redeemable at the option of the Company, in
whole or in part, on not less than 30 nor more than 60 days prior notice, at the
following redemption prices (expressed as percentages of principal amount), plus
accrued and unpaid interest and liquidated damages, if any, to the redemption
date (subject to the right of holders of record on the relevant record date to
receive
6
interest due on the relevant interest payment date), if redeemed during the 12-
month period commencing on September 15, of the years set forth below:
Year Redemption
Price
----------------------------------------------------------
2004 106.500%
2005 104.333%
2006 102.167%
2007 and thereafter 100.000%
In addition, prior to September 15, 2002, the Company may redeem up to
a maximum of 35% of the original aggregate principal amount of the Securities
with the Net Cash Proceeds of one or more Public Equity Offerings (i) by the
Company or (ii) by Parent or Holdings to the extent the Net Cash Proceeds
thereof are contributed to the Company or used to purchase Capital Stock (other
than Disqualified Stock) of the Company from the Company following which there
is a Public Market, at a redemption price equal to 113% of the principal amount
thereof, plus accrued and unpaid interest and liquidated damages thereon, if
any, to the redemption date (subject to the right of holders of record on the
relevant record date to receive interest due on the relevant interest payment
date); provided, however, that after giving effect to any such redemption, at
-------- -------
least 65% of the original aggregate principal amount of the Securities remains
outstanding. Any such redemption shall be made within 90 days of such Public
Equity Offering upon not less than 30 nor more than 60 days notice mailed to
each holder of Securities being redeemed and otherwise in accordance with the
procedures set forth in the Indenture.
6. Sinking Fund
------------
The Securities are not subject to any sinking fund.
7. Notice of Redemption
--------------------
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his or her registered address. Securities in
denominations 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 and liquidated damages, if any, 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.
8. Repurchase of Securities at the Option of Holders upon Change of Control
------------------------------------------------------------------------
Upon a Change of Control, any Holder of Securities will have the
right, subject to certain conditions specified in the Indenture, to cause the
Company to repurchase all or any part
7
of the Securities of such Holder at a purchase price equal to 101% of the
principal amount of the Securities to be repurchased plus accrued and unpaid
interest and liquidated damages, if any, to the date of repurchase (subject to
the right of Holders of record on the relevant record date to receive interest
due on the relevant interest payment date that is on or prior to the date of
purchase) as provided in, and subject to the terms of, the Indenture.
In accordance with Section 4.06 of the Indenture, the Company will be
required to offer to purchase Securities upon the occurrence of certain events.
9. Subordination
-------------
The Securities are subordinated to Senior Indebtedness, as defined in
the Indenture. To the extent provided in the Indenture, Senior Indebtedness must
be paid before the Securities may be paid. The Company and each Note Guarantor
agrees, and each Holder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give it
effect and appoints the Trustee as attorney-in-fact for such purpose.
10. Denominations; Transfer; Exchange
---------------------------------
The Securities are in registered form without coupons in denominations
of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. Upon any transfer or exchange, the
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements or transfer documents and to pay any taxes required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange 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)
or to transfer or exchange any Securities for a period of 15 days prior to a
selection of Securities to be redeemed or 15 days before an interest payment
date.
11. Persons Deemed Owners
---------------------
Except as provided in paragraph 2 hereof, the registered Holder of
this Security may be treated as the owner of it for all purposes.
12. Unclaimed Money
---------------
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its written 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.
8
13. Discharge and Defeasance
------------------------
Subject to certain conditions, the Company at any time may terminate
some of or all 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 and interest on the Securities to redemption or maturity,
as the case may be.
14. Amendment, Waiver
-----------------
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended without prior notice to any Holder
but with the written consent of the Holders of at least a majority in aggregate
principal amount of the outstanding Securities and (ii) any default may be
waived with the written consent of the Holders of at least a majority in
principal amount of the outstanding Securities. Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder of Securities, the
Company and the Trustee may amend the Indenture or the Securities (i) to cure
any ambiguity, omission, defect or inconsistency; (ii) to comply with Article 5
of the Indenture; (iii) to provide for uncertificated Securities in addition to
or in place of certificated Securities; (iv) to add Note Guarantees with respect
to the Securities; (v) to secure the Securities; (vi) to add additional
covenants or to surrender rights and powers conferred on the Company; (vii) to
comply with the requirements of the SEC in order to effect or maintain the
qualification of the Indenture under the TIA; (viii) to make any change that
does not adversely affect the rights of any Holder; (ix) to make any change in
the subordination provisions of the Indenture that would limit or terminate the
benefits available to any holder of Senior Indebtedness of the Company (or any
representative thereof) under such subordination provisions; or (x) to provide
for the issuance of the Exchange Securities or Private Exchange Securities.
15. Defaults and Remedies
---------------------
If an Event of Default occurs (other than an Event of Default relating
to certain events of bankruptcy, insolvency or reorganization of the Company)
and is continuing, the Trustee or the Holders of at least 25% in principal
amount of the outstanding Securities may declare the principal of and accrued
but unpaid interest on all the Securities to be due and payable. If an Event of
Default relating to certain events of bankruptcy, insolvency or reorganization
of the Company occurs, the principal of and interest on all the Securities shall
become immediately due and payable without any declaration or other act on the
part of the Trustee or any Holders. Under certain circumstances, the Holders of
a majority in principal amount of the outstanding Securities may rescind any
such acceleration with respect to the Securities and its consequences.
If an Event of Default occurs and is continuing, the Trustee shall be
under no obligation to exercise any of the rights or powers under the Indenture
at the request or direction of any of the Holders unless such Holders have
offered to the Trustee reasonable indemnity or security against any loss,
liability or expense and certain other conditions are complied with.
9
Except to enforce the right to receive payment of principal, premium (if any) or
interest when due, no Holder may pursue any remedy with respect to the Indenture
or the Securities unless (i) such Holder has previously given the Trustee notice
that an Event of Default is continuing, (ii) Holders of at least 25% in
principal amount of the outstanding Securities have requested the Trustee in
writing to pursue the remedy, (iii) such Holders have offered the Trustee
reasonable security or indemnity reasonably satisfactory to the Trustee against
any loss, liability or expense, (iv) the Trustee has not complied with such
request within 60 days after the receipt of the request and the offer of
security or indemnity and (v) the Holders of a majority in principal amount of
the outstanding Securities have not given the Trustee a direction inconsistent
with such request within such 60-day period. Subject to certain restrictions,
the Holders of a majority in principal amount of the outstanding Securities are
given the right to 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. The Trustee, however, may refuse to follow any
direction that conflicts with law or the Indenture or that the Trustee
determines is unduly prejudicial to the rights of any other Holder or that would
involve the Trustee in personal liability. Prior to taking any action under the
Indenture, the Trustee shall be entitled to indemnification satisfactory to it
in its sole discretion against all losses and expenses caused by taking or not
taking such action.
16. Trustee Dealings with the Company
---------------------------------
Subject to certain limitations imposed by the TIA, 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.
17. No Recourse Against Others
--------------------------
A director, officer, employee or stockholder, as such, of the Company
or any Note Guarantor shall not have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Holder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
18. Authentication
--------------
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
19. Abbreviations
-------------
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint
10
tenants with rights of survivorship and not as tenants in common), CUST
(=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
20. 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.
21. CUSIP and ISIN Numbers
----------------------
The Company has caused CUSIP [and ISIN] numbers to be printed on the
Securities and has directed the Trustee to use CUSIP [and ISIN] numbers in
notices of redemption as a convenience to Holders. No representation is made as
to the accuracy of such numbers either as printed on the Securities or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
The Company will furnish to any Holder of Securities upon written
request and without charge to the Holder a copy of the Indenture which has in it
the text of this Security.
11
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: _____________________
____________________________________________________________
Sign exactly as your name appears on the other side of this Security. Signature
must be guaranteed by a participant in a recognized signature guaranty medallion
program or other signature guarantor acceptable to the Trustee.
12
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.06 (Asset Disposition) or 4.08 (Change of Control) of the
Indenture, check the box:
Asset Disposition [_] Change of Control [_]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.06 or 4.08 of the Indenture, state the amount
($1,000 or an integral multiple thereof):
$
Date: __________________ Your Signature: ___________________________________
(Sign exactly as your name appears
on the other side of the Security)
Signature Guarantee:_______________________________________________
Signature must be guaranteed by a participant
in a recognized signature guaranty medallion
program or other signature guarantor acceptable
to the Trustee.
13
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The initial principal amount of this Global Security is $[ ].
The following increases or decreases in this Global Security have been made:
Date of Amount of decrease in Amount of increase in Principal amount of this Signature of
Exchange Principal Amount of Principal Amount of this Global Security authorized signatory
this Global Security Global Security following such decrease of Trustee or
or increase Securities Custodian
EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") dated
as of , among [GUARANTOR] (the "New
Guarantor"), a subsidiary of BETTER MINERALS & AGGREGATES COMPANY
(or its successor), a Delaware corporation (the "Company"),
[EXISTING GUARANTORS] and THE BANK OF NEW YORK, a New York
banking corporation, as trustee under the indenture referred to
below (the "Trustee").
W I T N E S S E T H :
WHEREAS the Company and [OLD GUARANTORS] (the "Existing Guarantors")
has heretofore executed and delivered to the Trustee an Indenture (the
"Indenture") dated as of October 1, 1999, providing for the issuance of an
aggregate principal amount of up to $150,000,000 of 113% Senior Subordinated
Notes due 2009 (the "Securities");
WHEREAS Section 4.11 of the Indenture provides that under certain
circumstances the Company is required to cause the New Guarantor to execute and
deliver to the Trustee a supplemental indenture pursuant to which the New
Guarantor shall unconditionally guarantee all the Company's obligations under
the Securities pursuant to a Note Guarantee on the terms and conditions set
forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the
Company and the Existing Guarantors are authorized to execute and deliver this
Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt of which is hereby acknowledged, the New
Guarantor, the Company, the Existing Guarantors and the Trustee mutually
covenant and agree for the equal and ratable benefit of the holders of the
Securities as follows:
1. Agreement to Guarantee. The New Guarantor hereby agrees, jointly
----------------------
and severally with all the Existing Guarantors, to unconditionally guarantee the
Company's obligations under the Securities on the terms and subject to the
conditions set forth in Articles 11 and 12 of the Indenture and to be bound by
all other applicable provisions of the Indenture and the Securities.
2. Ratification of Indenture; Supplemental Indentures Part of
----------------------------------------------------------
Indenture. Except as expressly amended hereby, the Indenture is in all respects
- ---------
ratified and confirmed and all the terms, conditions and provisions thereof
shall remain in full force and effect. This Supplemental
2
Indenture shall form a part of the Indenture for all purposes, and every holder
of Securities heretofore or hereafter authenticated and delivered shall be bound
hereby.
3. Governing Law. THIS SUPPLEMENTAL INDENTURE 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.
4. Trustee Makes No Representation. The Trustee makes no
-------------------------------
representation as to the validity or sufficiency of this Supplemental Indenture.
5. Counterparts. The parties may sign any number of copies of this
------------
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement.
6. Effect of Headings. The Section headings herein are for
------------------
convenience only and shall not effect the construction thereof.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.
[NEW GUARANTOR],
by
__________________________________________
Name:
Title:
BETTER MINERALS & AGGREGATES COMPANY,
by
__________________________________________
Name:
Title:
3
[EXISTING GUARANTORS],
by_____________________________
Name:
Title:
THE BANK OF NEW YORK, as Trustee,
by
_________________________________
Name:
Title:
EXHIBIT D
Form of
Transferee Letter of Representation
Better Minerals & Aggregates Company
In care of
The Bank of New York
101 Barclay Street
New York, New York 10286
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $[ ] principal
amount of the 13% Senior Subordinated Notes due 2009 (the "Securities") of
Better Minerals & Aggregates Company (the "Company").
Upon transfer, the Securities would be registered in the name of the new
beneficial owner as follows:
Name:________________________
Address:_____________________
Taxpayer ID Number:__________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")), purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount of the
Securities, and we are acquiring the Securities not with a view to, or for offer
or sale in connection with, any distribution in violation of the Securities Act.
We have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Securities,
and we invest in or purchase securities similar to the Securities in the normal
course of our business. We, and any accounts for which we are acting, are each
able to bear the economic risk of our or its investment.
2. We understand that the Securities have not been registered under the
Securities Act and, unless so registered, may not be sold except as permitted in
the following sentence. We agree on our own behalf and on behalf of any
investor account for which we are purchasing Securities to offer, sell or
otherwise transfer such Securities prior to the date that is two years
2
after the later of the date of original issue and the last date on which the
Company or any affiliate of the Company was the owner of such Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date") only (a) to the
Company, (b) pursuant to a registration statement that has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act ("Rule 144A"), to a person we
reasonably believe is a qualified institutional buyer under Rule 144A (a "QIB")
that is purchasing for its own account or for the account of a QIB and to whom
notice is given that the transfer is being made in reliance on Rule 144A, (d)
pursuant to offers and sales that occur outside the United States within the
meaning of Regulation S under the Securities Act, (e) to an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act that is purchasing for its own account or for the
account of such an institutional "accredited investor," in each case in a
minimum principal amount of Securities of $250,000, or (f) pursuant to any other
available exemption from the registration requirements of the Securities Act,
subject in each of the foregoing cases to any requirement of law that the
disposition of our property or the property of such investor account or accounts
be at all times within our or their control and in compliance with any
applicable state securities laws. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Securities is proposed to be made pursuant to clause (e)
above prior to the Resale Restriction Termination Date, the transferor shall
deliver a letter from the transferee substantially in the form of this letter to
the Company and the Trustee, which shall provide, among other things, that the
transferee is an institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act and that it is acquiring
such Securities for investment purposes and not for distribution in violation of
the Securities Act. Each purchaser acknowledges that the Company and the Trustee
reserve the right prior to the offer, sale or other transfer prior to the Resale
Restriction Termination Date of the Securities pursuant to clause (d), (e) or
(f) above to require the delivery of an opinion of counsel, certifications or
other information satisfactory to the Company and the Trustee.
TRANSFEREE:_________________,
by:________________________