Exhibit 4.1
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COMPASS MINERALS GROUP, INC.
as Issuer,
the GUARANTORS named herein
and
THE BANK OF NEW YORK,
as Trustee
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INDENTURE
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Dated as of November 28, 2001
10% Senior Subordinated Notes due 2011
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CROSS-REFERENCE TABLE
TIA Section Indenture Section
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310(a)(1)................................................... 7.10
(a)(2)................................................... 7.10
(a)(3)................................................... N.A.
(a)(4)................................................... N.A.
(a)(5)................................................... 7.8; 7.10
(b)...................................................... 7.8; 7.10; 13.2
(c)...................................................... N.A.
311(a)...................................................... 7.11
(b)...................................................... 7.11
(c)...................................................... N.A.
312(a)...................................................... 2.5
(b)...................................................... 13.3
(c)...................................................... 13.3
313(a)...................................................... 7.6
(b)(1)................................................... 7.6
(b)(2)................................................... 7.6
(c)...................................................... 7.6; 13.2
(d)...................................................... 7.6
314(a)...................................................... 4.8; 4.10
(b)...................................................... N.A.
(c)(1)................................................... 7.2; 13.4; 13.5
(c)(2)................................................... 7.2; 13.4; 13.5
(c)(3)................................................... N.A.
(d)...................................................... N.A.
(e)...................................................... 13.5
(f)...................................................... N.A.
315(a)...................................................... 7.1(b)
(b)...................................................... 7.5
(c)...................................................... 7.1
(d)...................................................... 6.5; 7.1(c)
(e)...................................................... 6.11
316(a)(last sentence)....................................... 2.9
(a)(1)(A)................................................ 6.5
(a)(1)(B)................................................ 6.4
(a)(2)................................................... N.A.
(b)...................................................... 6.7
(c)...................................................... 9.5
317(a)(1)................................................... 6.8
(a)(2)................................................... 6.9
(b) ..................................................... 2.4
318(a)...................................................... 13.1
(c) ..................................................... 13.1
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N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of this Indenture.
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
1.1. Definitions...................................................... 1
1.2. Incorporation By Reference of TIA................................ 37
1.3. Rules of Construction............................................ 37
ARTICLE II
THE SECURITIES
2.1. Form and Dating.................................................. 38
2.2. Execution and Authentication..................................... 39
2.3. Registrar and Paying Agent....................................... 41
2.4. Paying Agent To Hold Assets In Trust............................. 41
2.5. Holder Lists..................................................... 42
2.6. Transfer and Exchange............................................ 42
2.7. Replacement Securities........................................... 43
2.8. Outstanding Securities........................................... 44
2.9. Treasury Securities.............................................. 44
2.10. Temporary Securities............................................. 44
2.11. Cancellation..................................................... 45
2.12. Defaulted Interest............................................... 45
2.13. CUSIP and ISIN Numbers........................................... 45
2.14. Restrictive Legends.............................................. 46
2.15. Book-Entry Provisions For Global Security........................ 48
2.16. Special Transfer Provisions...................................... 49
ARTICLE III
REDEMPTION
3.1. Notices To Trustee............................................... 53
3.2. Selection of Securities To Be Redeemed........................... 54
3.3. Notice of Redemption............................................. 54
3.4. Effect of Notice of Redemption................................... 55
3.5. Deposit of Redemption Price...................................... 55
3.6. Securities Redeemed In Part...................................... 56
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ARTICLE IV
COVENANTS
4.1. Payment of Securities................................................. 56
4.2. Maintenance of Office or Agency....................................... 56
4.3. Limitation On Restricted Payments..................................... 57
4.4. Limitation on Incurrence of Additional Indebtedness................... 62
4.5. Corporate Existence................................................... 62
4.6. Payment of Taxes and Other Claims..................................... 63
4.7. Maintenance of Properties and Insurance............................... 63
4.8. Compliance Certificate; Notice of Default............................. 63
4.9. Compliance With Laws.................................................. 64
4.10. Reports To Holders.................................................... 64
4.11. Waiver of Stay, Extension or Usury Laws............................... 65
4.12. Limitations on Transactions With Affiliates........................... 65
4.13. Limitation on Dividend and Other Payment Restrictions Affecting
Subsidiaries........................................................ 67
4.14. Limitation on the Issuance and Sale of Capital Stock of Restricted
Subsidiaries........................................................ 69
4.15. Limitation on Issuances of Guarantees By Restricted Subsidiaries...... 70
4.16. Limitation on Liens................................................... 70
4.17. Change of Control..................................................... 71
4.18. Limitation on Asset Sales............................................. 74
4.19. Prohibition on Incurrence of Senior Subordinated Debt................. 78
4.20 Future Guarantors..................................................... 78
ARTICLE V
SUCCESSOR CORPORATION
5.1. Merger, Consolidation and Sale of Assets.............................. 79
5.2. Successor Corporation Substituted..................................... 81
ARTICLE VI
DEFAULT AND REMEDIES
6.1. Events of Default..................................................... 81
6.2. Acceleration.......................................................... 83
6.3. Other Remedies........................................................ 84
6.4. Waiver of Past Defaults............................................... 84
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6.5 Control By Majority ............................................. 84
6.6 Limitation on Suits ............................................. 84
6.7 Rights of Holders To Receive Payment ............................ 85
6.8 Collection Suit By Trustee ...................................... 85
6.9 Trustee May File Proofs of Claim ................................ 85
6.10 Priorities ...................................................... 86
6.11 Undertaking For Costs ........................................... 86
6.12 Restoration of Rights and Remedies .............................. 87
6.13 Rights and Remedies Cumulative .................................. 88
ARTICLE VII
TRUSTEE
7.1 Duties of Trustee ................................................ 87
7.2 Rights of Trustee ................................................ 88
7.3 Individual Rights of Trustee ..................................... 90
7.4 Trustee's Disclaimer ............................................. 90
7.5 Notice of Default ................................................ 90
7.6 Reports By Trustee To Holders .................................... 90
7.7 Compensation and Indemnity ....................................... 91
7.8 Replacement of Trustee ........................................... 92
7.9 Successor Trustee By Merger, Etc ................................. 93
7.10 Eligibility; Disqualification .................................... 93
7.11 Preferential Collection of Claims Against the Issuer ............. 94
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
8.1 Termination of the Issuer's Obligations .......................... 94
8.2 Legal Defeasance and Covenant Defeasance ......................... 95
8.3 Conditions To Legal Defeasance or Covenant Defeasance............. 96
8.4 Application of Trust Money ....................................... 98
8.5 Repayment To the Issuer .......................................... 99
8.6 Reinstatement..................................................... 99
ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
9.1 Without Consent of Holders ....................................... 100
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9.2. With Consent of Holders............................................. 101
9.3. Effect on Senior Debt............................................... 102
9.4. Compliance With TIA................................................. 102
9.5. Revocation and Effect of Consents................................... 102
9.6. Notation on or Exchange of Securities............................... 103
9.7. Trustee To Sign Amendments, Etc..................................... 103
ARTICLE X
SUBORDINATION OF SECURITIES
10.1. Securities Subordinated To Senior Debt.............................. 104
10.2. Suspension of Payment When Senior Debt Is In Default................ 104
10.3. Securities Subordinated To Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of the Issuer.......... 105
10.4. Payments May Be Paid Prior To Dissolution........................... 107
10.5. Holders To Be Subrogated To Rights of Holders of Senior Debt........ 107
10.6. Obligations of The Issuer Unconditional............................. 108
10.7. Notice to Trustee................................................... 108
10.8. Reliance on Judicial Order or Certificate of Liquidating Agent...... 109
10.9. Trustee's Relation to Senior Debt................................... 109
10.10. Subordination Rights Not Impaired By Acts or Omissions of The
Issuer or Holders of Senior Debt.................................. 110
10.11. Securityholders Authorize Trustee to Effectuate Subordination of
Securities........................................................ 110
10.12. This Article Ten Not to Prevent Events of Default................... 111
10.13. Trustee's Compensation Not Prejudiced............................... 111
ARTICLE XI
GUARANTEE OF SECURITIES
11.1. Unconditional Guarantee............................................. 111
11.2. Limitations on Guarantees........................................... 112
11.3. Execution and Delivery of Guarantee................................. 113
11.4. Release of a Guarantor.............................................. 113
11.5. Waiver of Subrogation............................................... 114
11.6. Immediate Payment................................................... 115
11.7. No Setoff........................................................... 115
11.8. Obligations Absolute................................................ 115
11.9. Obligations Continuing.............................................. 116
11.10. Obligations Not Reduced............................................. 116
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11.11. Obligations Reinstated................................................... 116
11.12. Obligations Not Affected................................................. 116
11.13. Waiver................................................................... 118
11.14. No Obligation to Take Action Against The Issuer.......................... 118
11.15. Dealing With the Issuer and Others....................................... 118
11.16. Default and Enforcement.................................................. 119
11.17. Amendment, Etc........................................................... 119
11.18. Acknowledgment........................................................... 119
11.19. Costs and Expenses....................................................... 119
11.20. No Merger or Waiver; Cumulative Remedies................................. 119
11.21. Survival of Obligations.................................................. 120
11.22. Guarantee in Addition to Other Obligations............................... 120
11.23. Severability............................................................. 120
11.24. Successors and Assigns................................................... 120
ARTICLE XII
SUBORDINATION OF SUBSIDIARY GUARANTEE
12.1. Guarantee Obligations Subordinated to Guarantor Senior Debt.............. 121
12.2. Suspension Of Guarantee Obligations When Guarantor
Senior Debt Is in Default............................................. 121
12.3. Guarantee Obligations Subordinated To Prior Payment of All
Guarantor Senior Debt on Dissolution, Liquidation or
Reorganization of Such Guarantor...................................... 122
12.4. Payments May Be Paid Prior to Dissolution................................ 123
12.5. Holders of Guarantee Obligations to Be Subrogated to Rights of
Holders of Guarantor Senior Debt...................................... 124
12.6. Obligations of the Guarantors Unconditional.............................. 124
12.7. Notice to Trustee........................................................ 124
12.8. Reliance on Judicial Order or Certificate of Liquidating Agent........... 125
12.9. Trustee's Relation to Guarantor Senior Debt.............................. 126
12.10. Subordination Rights Not Impaired by Acts or Omissions of the
Guarantors or Holders of Guarantor Senior Debt........................ 126
12.11. Holders Authorize Trustee to Effectuate Subordination of Guarantee
Obligations........................................................... 127
12.12. This Article Twelve Not to Prevent Events of Default..................... 127
12.13. Trustee's Compensation Not Prejudiced.................................... 127
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ARTICLE XIII
MISCELLANEOUS
13.1. TIA Controls.......................................................... 128
13.2. Notices............................................................... 128
13.3. Communications by Holders With Other Holders.......................... 129
13.4. Certificate and Opinion as to Conditions Precedent.................... 129
13.5. Statements Required in Certificate or Opinion......................... 130
13.6. Rules by Trustee, Paying Agent, Registrar............................. 130
13.7. Legal Holidays........................................................ 130
13.8. Governing Law......................................................... 130
13.9. No Adverse Interpretation of Other Agreements......................... 131
13.10. No Recourse Against Others............................................ 131
13.11. Successors............................................................ 131
13.12. Duplicate Originals................................................... 131
13.13. Severability.......................................................... 131
Exhibit A - Form of Initial Note
Exhibit B - Form of Exchange Note
Exhibit C - Form of Certificate for Transfers to Non-QIB Accredited Investors
Exhibit D - Form of Certificate for Transfers Pursuant to Regulation S
Exhibit E - Guarantee
Note: This Table of Contents shall not, for any purpose, be deemed to be part
of this Indenture
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INDENTURE dated as of November 28, 2001 among COMPASS MINERALS GROUP,
INC., a Delaware corporation (the "Issuer" or the "Company"), the Guarantors (as
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defined herein) and THE BANK OF NEW YORK, as trustee (the "Trustee").
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The Issuer has duly authorized the creation of an issue of 10% Senior
Subordinated Notes due 2011 and, when and if issued as provided in the
Registration Rights Agreement in an Exchange Offer, 10% Senior Subordinated
Notes due 2011 registered under the Securities Act of 1933, as amended, and, to
provide therefor, the Issuer has duly authorized the execution and delivery of
this Indenture. All things necessary to make the Securities, when duly issued
and executed by the Issuer and authenticated and delivered hereunder, the valid
and binding obligations of the Issuer and to make this Indenture a valid and
binding agreement of the Issuer have been done.
This Indenture is subject to, and shall be governed by, the mandatory
provisions of the Trust Indenture Act of 1939 (the "TIA"), as amended, that are
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required to be a part of and to govern indentures qualified under the Trust
Indenture Act of 1939, as amended.
Each party hereto agrees as follows for the benefit of each other party
and for the equal and ratable benefit of the Holders of the Securities:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
1.1. Definitions.
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"Acceleration Notice" has the meaning set forth in Section 6.2.
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"Accredited Investor" has the meaning set forth in Section 2.16(a).
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"Acquired Indebtedness" means Indebtedness of a Person or any of its
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Subsidiaries (1) existing at the time such Person becomes a Restricted
Subsidiary of the Company or at the time it merges or consolidates with the
Company or any of its Restricted Subsidiaries or (2) assumed in connection with
the acquisition of assets from such Person, in each case, not incurred by such
Person in connection with, or in anticipation or contemplation of, such Person
becoming a Restricted Subsidiary of the Company or such acquisition, merger or
consolidation.
"Affiliate" means, with respect to any specified Person, any other
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Person who directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, such specified Person. The
term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and poli-
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cies of a Person, whether through the ownership of voting securities, by
contract or otherwise. "Controlling" and "controlled" have correlative meanings.
For purposes of this Indenture, IMC Global Inc. and its Affiliates shall not be
deemed to be an Affiliate of the Company so long as they beneficially own
securities representing equal to less than thirty-five percent of the voting
power of the Company or Holdings; provided that Apollo beneficially owns
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securities representing a greater percentage of the voting power of the Company
or Holdings than IMC Global Inc. and its Affiliates.
"Affiliate Transaction" has the meaning set forth in Section 4.12(a).
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"Agent" means any Registrar, Paying Agent or co-Registrar.
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"Agent Members" has the meaning set forth in Section 2.15(a).
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"Apollo" means Apollo Management V, L.P. and its Affiliates.
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"Applicable Premium" means, with respect to a Security, the greater of
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(i) 1.0% of the then outstanding principal amount of such Security and (ii) (a)
the present value of all remaining required interest and principal payments due
on such Security and all premium payments relating thereto assuming a redemption
date of August 15, 2006, computed using a discount rate equal to the Treasury
Rate plus 50 basis points, minus (b) the then outstanding principal amount of
such Security minus (c) accrued interest paid on the date of redemption.
"Asset Acquisition" means:
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(1) an Investment by the Company or any of its Restricted
Subsidiaries in any other Person pursuant to which such Person shall
become a Restricted Subsidiary of the Company or any Restricted
Subsidiary of the Company, or shall be merged with or into or
consolidated with the company or any Restricted Subsidiary of the
Company; or
(2) the acquisition by the Company or any of its Restricted
Subsidiaries of the assets of any Person (other than a Restricted
Subsidiary of the Company) which constitute all or substantially all of
the assets of such Person or comprise any division or line of business
of such Person or any other properties or assets of such Person other
than in the ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
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transfer, lease (other than operating leases entered into in the ordinary course
of business), assignment or other transfer for value by the Company or any of
its Restricted Subsidiaries, including any Sale and Leaseback Transaction, to
any Person other than the Company or a Wholly Owned Restricted Subsidiary of the
Company of (a) any Capital Stock of any Restricted Subsidiary of the Company
(other than directors' qualifying shares); or (b) any other property or assets
of
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the Company or any Restricted Subsidiary of the Company other than in the
ordinary course of business; provided, however, that Asset Sales shall not
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include:
(1) a transaction or series of related transactions for which the
Company or its Restricted Subsidiaries receive aggregate consideration of
less than $3.0 million;
(2) the sale or exchange of equipment in connection with the purchase
or other acquisition of other equipment, in each case used in the business
of the Company and its Restricted Subsidiaries;
(3) the sale, lease, conveyance, disposition or other transfer of all
or substantially all of the assets of the Company as permitted under
Section 5.1;
(4) disposals of equipment in connection with the reinvestment in or
the replacement of its equipment and disposals of worn-out or obsolete
equipment, in each case in the ordinary course of business of the Company
or its Restricted Subsidiaries;
(5) the sale of accounts receivable pursuant to a Qualified
Receivables Transaction;
(6) sales or grants of licenses to use the Company's or any Restricted
Subsidiary's patents, trade secrets, know-how and technology to the extent
that such license does not prohibit the licensor from using the patent,
trade secret, know-how or technology;
(7) the disposition of any Capital Stock or other ownership interest
in or assets or property of an Unrestricted Subsidiary;
(8) Capacity Arrangements;
(9) any Restricted Payment permitted under Section 4.3 or that
constitutes a Permitted Investment; and
(10) one or more Sale and Leaseback Transactions for which the Company
or any Restricted Subsidiary of the Company receives aggregate
consideration of less than $15.0 million.
"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal, state
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or foreign law for the relief of debtors.
"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and
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Rule 13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular "person" (as such term is used in Section 13(d)(3)
of the Exchange Act), such "person" shall be deemed to have beneficial ownership
of all securities that such "person" has the right
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to acquire, whether such right is currently exercisable or is exercisable only
upon the occurrence of a subsequent condition, regardless of when such right may
be exercised.
"Board of Directors" means, as to any Person, the board of directors or
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equivalent governing board of such Person or any duly authorized committee
thereof.
"Board Resolution" means, with respect to any Person, a copy of a
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resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day other than a Saturday, Sunday or any other
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day on which banking institutions in the City of New York are required or
authorized by law or other governmental action to be closed.
"Capacity Arrangements" means any agreement or arrangement involving,
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relating to or otherwise facilitating, (a) requirement contracts, (b) tolling
arrangements or (c) the reservation or presale of production capacity of the
Company or its Restricted Subsidiaries by one or more third parties.
"Capitalized Lease Obligation" means, at the time any determination
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thereof is to be made, the amount of the liability of a Person under a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP, with the stated maturity being 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.
"Capital Stock" means:
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(1) with respect to any person that is a corporation, any and all
shares, interests, rights to purchase, warrants, options,
participations or other equivalents (however designated and whether or
not voting) of corporate stock; and
(2) with respect to any Person that is not a corporation, any and
all partnership, membership, limited liability company interests or
other equity interests of such Person.
"Cash Equivalents" means:
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(1) U.S. dollars, and in the case of any Foreign Restricted
Subsidiaries of the Company, Euros and such local currencies held by
them from time to time in the ordinary course of business;
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(2) marketable direct obligations issued by, or unconditionally
guaranteed by, the United States, Canada and the United Kingdom or issued
by any agency of these countries and backed by the full faith and credit of
the respective country, in each case maturing within one year from the date
of acquisition thereof;
(3) marketable direct obligations issued by any State of the United
States of America or any political subdivision of any such State or any
public instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from either Standard & Poor's Ratings Services
("S&P") or Moody's Investors Service, Inc. ("Moody's") or, if Moody's and
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S&P cease to exist, any other nationally recognized statistical rating
organization designated by the Board of Directors of the Company;
(4) commercial paper maturing no more than one year from the date of
creation thereof and, at the time of acquisition, having a rating of at
least A- 1 from S&P or at least P-1 from Moody's or, if Moody's and S&P
cease to exist, the equivalent from any other nationally recognized
statistical rating organization designated by the Board of Directors of the
Company;
(5) time deposits, certificates of deposit or bankers' acceptances
maturing within one year from the date of acquisition thereof issued by any
bank organized under the laws of the United States of America or any state
thereof or the District of Columbia or any foreign jurisdiction having at
the date of acquisition thereof combined capital and surplus of not less
than $250.0 million;
(6) repurchase obligations with a term of not more than thirty days
for underlying securities of the types described in clause (2) above
entered into with any bank meeting the qualifications specified in clause
(5) above;
(7) investments in money market funds which invest substantially all
their assets in securities of the types described in clauses (2) through
(6) above; and
(8) overnight deposits and demand deposit accounts (in the respective
local currencies) maintained in the ordinary course of business.
"Change of Control" means the occurrence of one or more of the following
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events:
(1) any sale, lease, exchange, conveyance, disposition or other
transfer (in one transaction or a series of related transactions) of all or
substantially all of the Company's assets to any Person or group of related
Persons for purposes of Section 13(d) of the Exchange Act (a "Group"),
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together with any Affiliates thereof (whether or not otherwise in
compliance with the provisions of this Indenture), other than to the
Permitted Holders;
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(2) any approval, adoption or initiating of a plan or proposal for the
liquidation or dissolution of the Company (whether or not otherwise in
compliance with the provisions of this Indenture);
(3) any Person or Group, together with any Affiliates thereof (other
than the Permitted Holders) shall become the Beneficial Owner or owner of
record (by way of merger, consolidation or other business combinations or
by purchase in one transaction or a series of related transactions) of
shares representing more than 50% of the aggregate ordinary voting power
represented by the issued and outstanding Capital Stock of the Company or
Holdings;
(4) any Person or Group, together with any Affiliates or Related
Persons thereof (other than the Permitted Holders) shall succeed in having
a sufficient number of its nominees elected to the Board of Directors of
the Company or Holdings such that such nominees, when added to any existing
director remaining on the Board of Directors of the Company or Holdings
after such election who was a nominee of or is an Affiliate or related
Person of such Person or Group, will constitute a majority of the Board of
Directors of the Company or Holdings; or
(5) Holdings shall cease to own, directly or indirectly, a majority of
the Capital Stock of the Company.
"Change of Control Date" has the meaning set forth in Section 4.17(c).
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"Change of Control Offer" has the meaning set forth in Section 4.17(a).
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"Change of Control Payment Date" has the meaning set forth in Section
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4.17(a).
"Commission" means the Securities and Exchange Commission, as from time to
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time constituted, created under the Exchange Act or, with respect to the
Commission's duties under the TIA, if at any time after the execution of this
instrument such Commission is not existing and performing the duties now
assigned to it under the TIA, then the body performing such duties at such time.
"Commodity Agreement" means any commodity futures contract, commodity
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option or other similar agreement or arrangement entered into by the Company or
any Restricted Subsidiaries of the Company designed to protect the Company or
any of its Restricted Subsidiaries against fluctuations in the price of the
commodities at the time used in the ordinary course of business of the Company
or any of its Restricted Subsidiaries.
"Common Stock" of any Person means any and all shares, interests or other
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participations in, and other equivalents (however designated and whether voting
or non-voting) of such
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Person's common stock, whether outstanding on the Issue Date or issued after the
Issue Date, and includes, without limitation, all series and classes of such
common stock.
"Company" means the party named as such in this Indenture until a
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successor replaces it pursuant to this Indenture and thereafter shall mean such
successor Person.
"Consolidated EBITDA" means, with respect to any Person, for any
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period, the sum (without duplication) of:
(1) Consolidated Net Income; and
(2) to the extent Consolidated Net Income has been reduced
thereby,
(a) all income taxes of such Person and its Restricted
Subsidiaries paid or accrued in accordance with GAAP for such
period (other than income taxes attributable to extraordinary,
unusual or nonrecurring gains or losses),
(b) Consolidated Interest Expense, and
(c) Consolidated Non-cash Charges less any non-cash
items increasing Consolidated Net Income for such period,
all as determined on a consolidated basis for such Person and its Restricted
Subsidiaries in accordance with GAAP as applicable.
"Consolidated Fixed Charge Coverage Ratio" means, with respect to any
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Person, the ratio of Consolidated EBITDA of such Person during the four full
fiscal quarters for which financial statements are available (the "Four Quarter
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Period") ending on or prior to the date of the transaction giving rise to the
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need to calculate the Consolidated Fixed Charge Coverage Ratio (the "Transaction
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Date") to Consolidated Fixed Charges of such Person for the Four Quarter Period.
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In addition to and without limitation of the foregoing, for purposes of this
definition, "Consolidated EBITDA" and "Consolidated Fixed Charges" shall be
calculated after giving effect on a pro forma basis (consistent with the
provisions below) for the period of such calculation to:
(1) the incurrence or repayment of any Indebtedness of such
Person or any of its Restricted Subsidiaries (and the application of
the proceeds thereof) giving rise to the need to make such calculation
and any incurrence or repayment of other Indebtedness (and the
application of the proceeds thereof), other than the incurrence or
repayment of Indebtedness in the ordinary course of business for
working capital purposes pursuant to working capital facilities,
occurring during the Four Quarter Period or at any time subsequent to
the last day of the Four Quarter Period and on or
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prior to the Transaction Date, as if such incurrence or
repayment, as the case may be (and the application of the proceeds
thereof), occurred on the first day of the Four Quarter Period;
(2) any asset sales or other dispositions or Asset Acquisitions
(including, without limitation, any Asset Acquisition giving rise to
the need to make such calculation as a result of such Person or one of
its Restricted Subsidiaries (including any Person who becomes a
Restricted Subsidiary as a result of the Asset Acquisition) incurring,
assuming or otherwise being liable for Acquired Indebtedness and also
including any Consolidated EBITDA (including any pro forma expense and
cost reductions, adjustments and other operating improvements or
synergies both achieved by such Person during such period and to be
achieved by such Person and with respect to the acquired assets, all
as determined in good faith by a responsible financial or accounting
officer of such Person attributable to the assets which are the
subject of the Asset Acquisition or asset sale or other dispositions
during the Four Quarter Period) occurring during the Four Quarter
Period or at any time subsequent to the last day of the Four Quarter
Period and on or prior to the Transaction Date, as if such asset sale
or other disposition or Asset Acquisition (including the incurrence,
assumption or liability for any such Acquired Indebtedness) occurred
on the first day of the Four Quarter Period. If such Person or any of
its Restricted Subsidiaries directly or indirectly guarantees
Indebtedness of a third Person, the preceding sentence shall give
effect to the incurrence of such guaranteed Indebtedness as if such
Person or any Restricted Subsidiary of such Person had directly
incurred or otherwise assumed such guaranteed Indebtedness; and
(3) all adjustments used in connection with the calculation of
pro forma EBITDA and Adjusted EBITDA as set forth in the Offering
Circular to the extent such adjustments are not fully reflected in
such Four Quarter Period and continue to be applicable.
Furthermore, in calculating "Consolidated Fixed Charges" for purposes
of determining the denominator (but not the numerator) of this "Consolidated
Fixed Charge Coverage Ratio,"
(1) interest on outstanding Indebtedness determined on a
fluctuating basis as of the Transaction Date and which will continue
to be so determined thereafter shall be deemed to have accrued at a
fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date; and
(2) notwithstanding clause (1) above, interest on Indebtedness
determined on a fluctuating basis, to the extent such interest is
covered by agreements relating to Interest Swap Obligations or
Currency Agreements, shall be deemed to accrue at the rate per annum
resulting after giving effect to the operation of such agreements.
-9-
"Consolidated Fixed Charges" means, with respect to any Person for any
--------------------------
period, the sum, without duplication, of:
(1) Consolidated Interest Expense (excluding amortization or
write-off of deferred financing costs), plus
(2) the product of (x) the amount of all dividend payments on any
series of Preferred Stock of such Person or its Restricted
Subsidiaries (other than dividends paid in Qualified Capital Stock)
paid, accrued or scheduled to be paid or accrued during such period
times (y) a fraction, the numerator of which is one and the
denominator of which is one minus the then current effective
consolidated federal, state and local income tax rate of such Person,
expressed as a decimal.
"Consolidated Interest Expense" means, with respect to any Person for
-----------------------------
any period, the sum of, without duplication:
(1) the aggregate of the interest expense of such Person and its
Restricted Subsidiaries for such period determined on a consolidated
basis in accordance with GAAP, including, without limitation, (a) any
amortization of debt discount and amortization or write-off of
deferred financing costs (including the amortization of costs relating
to interest rate caps or other similar agreements), (b) the net costs
under Interest Swap Obligations, (c) all capitalized interest and (d)
the interest portion of any deferred payment obligation; and
(2) the interest component of Capitalized Lease Obligations paid,
accrued and/or scheduled to be paid or accrued by such Person and its
Restricted Subsidiaries during such period as determined on a
consolidated basis in accordance with GAAP, minus interest income for
such period.
"Consolidated Net Income" means, with respect to any Person, for any
-----------------------
period, the aggregate net income (or loss) of such Person and its Restricted
Subsidiaries for such period on a consolidated basis, determined in accordance
with GAAP; provided that there shall be excluded therefrom:
--------
(1) after-tax gains or losses from Asset Sales (without regard to
the $3.0 million limitation set forth in the definition thereof) or
abandonments or reserves relating thereto;
(2) after-tax items which are extraordinary gains or losses or
nonrecurring gains, losses, expenses or income (including, without
limitation, expenses related to the Transactions, severance and
transition expenses incurred as a direct result of the transition of
the Company to an independent operating company in connection with the
Transactions provided that with respect to any non-recurring item or
transition
-10-
expense, the Company delivers to the Trustee an Officer's Certificate
specifying and quantifying such item or expense and states that such
item or expense is a general non-recurring item or specifically a
severance or transition expense, as the case may be);
(3) the net income of any Person acquired in a "pooling of
interests" transaction accrued before the date it becomes a Restricted
Subsidiary of the referent Person or is merged or consolidated with
the referent Person or any Restricted Subsidiary of the referent
Person;
(4) the net income (but not loss) of any Restricted Subsidiary of
the referent Person to the extent that the declaration of dividends or
similar distributions by that Restricted Subsidiary of that income is
prohibited by contract, operation of law or otherwise;
(5) the net income of any Person, other than a Restricted
Subsidiary of the referent Person, except to the extent of cash
dividends or distributions paid to the referent Person or to a
Restricted Subsidiary of the referent Person by such Person;
(6) the establishment of accruals and reserves within twelve
months after the Issue Date that are required to be so established in
accordance with GAAP;
(7) income or loss attributable to discontinued operations
(including, without limitation, operations disposed of during such
period whether or not such operations were classified as
discontinued); and
(8) in the case of a successor to the referent Person by
consolidation or merger or as a transferee of the referent Person's
assets, any earnings of the successor corporation prior to such
consolidation, merger or transfer of assets.
"Consolidated Non-cash Charges" means, with respect to any Person, for
-----------------------------
any period, the aggregate depreciation, amortization and other non-cash expenses
(solely for the purpose of determining compliance with Section 4.3, excluding
any non-cash items for which a future cash payment will be required and for
which an accrual or reserve is required by GAAP to be made) of such Person and
its Restricted Subsidiaries reducing Consolidated Net Income of such Person and
its Restricted Subsidiaries for such period, determined on a consolidated basis
in accordance with GAAP.
"Corporate Trust Office" means the office of the Trustee at which the
----------------------
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at c/o United States Trust Company of New York, 114 West 47th Street,
25th Floor, New York, New York 10036, Attention: Corporate Trust
Department/Compass Minerals.
-11-
"Covenant Defeasance" has the meaning set forth in Section 8.2(c).
-------------------
"Credit Agreement" means the Credit Agreement dated as of the Issue
----------------
Date, among the Company, Holdings, one or more other Subsidiaries of the
Company, the lenders party thereto in their capacities as lenders thereunder and
The Chase Manhattan Bank, as administrative agent, together with the related
documents thereto (including, without limitation, any guarantee agreements and
security documents), in each case as such agreements may be amended (including
any amendment and restatement thereof), supplemented or otherwise modified from
time to time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including increasing the amount of
available borrowings thereunder or adding Restricted Subsidiaries of the Company
as additional borrowers or guarantors thereunder) all or any portion of the
Indebtedness under such agreement or any successor or replacement agreement and
whether by the same or any other agent, lender or group of lenders.
"Currency Agreement" means any foreign exchange contract, currency swap
------------------
agreement or other similar agreement or arrangement designed to protect the
Company or any Restricted Subsidiary of the Company against fluctuations in
currency values.
"Custodian" means any receiver, trustee, assignee, liquidator,
---------
sequestrator or similar official under any Bankruptcy Law.
"Default" means an event that is, or with the passage of time or the
-------
giving of notice or both would be, an Event of Default.
"Depository" shall mean The Depository Trust Company, New York, New
----------
York, or a successor thereto registered under the Exchange Act or other
applicable statute or regulation.
"Designated Senior Debt" means:
----------------------
(1) Indebtedness under or in respect of the Credit Agreement; and
(2) any other Indebtedness constituting Senior Debt which, at the
time of determination, has an aggregate principal amount of at least
$25.0 million and is specifically designated in the instrument
evidencing such Senior Debt as "Designated Senior Debt" by the
Company.
"Disqualified Capital Stock" means that portion of 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 at the option of the holder
thereof), or upon the happening of any event (other than an event which would
constitute a Change of Control or an Asset Sale), matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the sole option of the holder thereof (except, in each case, upon the
occurrence of a Change of
-12-
Control or an Asset Sale), on or prior to the final maturity date of the
Securities; provided that any class of Capital Stock of such Person that by its
--------
terms authorizes such Person to satisfy its obligations thereunder by delivery
of Qualified Capital Stock shall not be deemed Disqualified Capital Stock.
"Domestic Restricted Subsidiary" means any Restricted Subsidiary of the
------------------------------
Company incorporated or otherwise organized or existing under the laws of the
United States, any State thereof or the District of Columbia.
"Equity Offering" means a public or private sale of Qualified Capital
---------------
Stock (other than on Form S-8) of the Issuer or Holdings or any other direct or
indirect parent of the Issuer; provided that with respect to any Equity Offering
--------
by Holdings or any such other direct or indirect parent of the Issuer, such
person contributes the net cash proceeds from such Equity Offering to the
Issuer.
"Euros" means the single currency of the participating member states as
-----
described in any legislative measures of the European Union for the introduction
of, change over to, or operation of, a single or unified European currency.
"Event of Default" has the meaning set forth in Section 6.1.
----------------
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
------------
or any successor statute or statutes thereto.
"Exchange Notes" means the 10% Senior Subordinated Notes due 2011 (the
--------------
terms of which are identical to the Initial Notes except that the Exchange Notes
shall be registered under the Securities Act, and shall not contain the
restrictive legend on the face of the form of the Initial Notes), to be issued
in exchange for the Initial Notes pursuant to the registered Exchange Offer.
"Exchange Offer" means the registration by the Company under the
--------------
Securities Act pursuant to a registration statement of the offer by the Company
to each Holder of the Initial Notes to exchange all the Initial Notes held by
such Holder for the Exchange Notes in an aggregate principal amount equal to the
aggregate principal amount of the Initial Notes held by such Holder, all in
accordance with the terms and conditions of the Registration Rights Agreement.
"Excluded Contribution" means Net Cash Proceeds received by the Company
---------------------
from (a) contributions to its common equity capital and (b) the sale of
Qualified Capital Stock of the Company, in each case designated as Excluded
Contributions pursuant to an Officers' Certificate executed on the date such
capital contributions are made or the date such Qualified Capital Stock is sold,
as the case may be, which are excluded from the calculation set forth in clause
(c) of Section 4.3.
-13-
"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. Fair market
value shall be determined conclusively by the Board of Directors of the Company
acting reasonably and in good faith and shall be evidenced by a Board Resolution
of the Board of Directors of the Company delivered to the Trustee.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary of the
-----------------------------
Company incorporated in any jurisdiction outside of the United States.
"GAAP" means generally accepted accounting principles set forth in the
----
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are in effect as of the Issue Date.
"Global Security" has the meaning set forth in Section 2.1.
---------------
"Guarantee" means the guarantee by each Guarantor of the Issuer's
---------
obligations under the Indenture.
"guarantee" means any obligation, contingent or otherwise, of any
---------
Person directly or indirectly guaranteeing any Indebtedness of any other Person,
including any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness of such other Person (whether arising by virtue of
partnership arrangements, or by agreements to keep-well, to purchase assets,
goods, securities or services (unless such purchase arrangements are on
arm's-length terms and are entered into in the ordinary course of business), to
take-or-pay, or to maintain financial statement conditions or otherwise), or
(ii) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part); provided that the term "guarantee"
--------
shall not include endorsements for collection or deposit in the ordinary course
of business. The term "guarantee" used as a verb has a corresponding meaning.
"Guaranteed Indebtedness" has the meaning set forth in Section 4.15.
-----------------------
"Guarantor" means:
---------
(1) each Domestic Restricted Subsidiary on the Issue Date;
(2) each New Domestic Restricted Subsidiary required to execute
and deliver a Guarantee pursuant to Section 4.15 and Section 4.20; and
-14-
(3) each of the Company's other Restricted Subsidiaries that in
the future executes a supplemental indenture in which such Restricted
Subsidiary agrees to be bound by the terms of this Indenture as a
Guarantor;
provided that any Person constituting a Guarantor as described above shall cease
- --------
to constitute a Guarantor when its Guarantee is released in accordance with the
terms of this Indenture.
"Guarantor Senior Debt" means, with respect to any Guarantor, the
---------------------
principal of, premium, if any, and interest (including any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for in
the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law) on any Indebtedness of a Guarantor, whether
outstanding on the Issue Date or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the instrument creating or
evidencing the same or pursuant to which the same is outstanding expressly
provides that such Indebtedness shall not be senior in right of payment to the
Guarantee of such Guarantor. Without limiting the generality of the foregoing,
"Guarantor Senior Debt" shall also include the principal of, premium, if any,
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on, and all other amounts owing by any Guarantor in respect of,
(x) all obligations of every nature of a Guarantor under, or with
respect to, the Credit Agreement, including, without limitation,
obligations to pay principal, premium and interest, reimbursement
obligations under letters of credit, fees, expenses and indemnities
(including guarantees thereof);
(y) all Interest Swap Obligations (including guarantees thereof);
and
(z) all obligations under Currency Agreements (including
guarantees thereof), in each case whether outstanding on the Issue Date
or thereafter incurred.
Notwithstanding the foregoing, "Guarantor Senior Debt" shall not
include:
(1) any Indebtedness of such Guarantor to a Restricted Subsidiary
of such Guarantor;
(2) Indebtedness to, or guaranteed on behalf of, any director,
officer or employee of such Guarantor or any director, officer or
employee of any Restricted Subsidiary of such Guarantor (including,
without limitation, amounts owed for compensation);
-15-
(3) Indebtedness or other liabilities to trade creditors and
other amounts incurred in connection with obtaining goods, materials
or services (other than if incurred under the Credit Agreement);
(4) Indebtedness represented by Disqualified Capital Stock or in
respect of Capital Stock;
(5) any liability for federal, state, local or other taxes owed
or owing by such Guarantor;
(6) that portion of any Indebtedness incurred in violation of
Section 4.4 (but, as to any such obligation, no such violation shall
be deemed to exist for purposes of this clause (6) if the holder(s) of
such obligation or their representative shall have received an
Officers' Certificate of the Company to the effect that the incurrence
of such Indebtedness does not (or, in the case of revolving credit
Indebtedness, that the incurrence of the entire committed amount
thereof at the date on which the initial borrowing thereunder is made
would not) violate such provisions of this Indenture);
(7) any Indebtedness which, when incurred and without respect to
any election under Section 1111(b) of Title 11, United States Code, is
without recourse to such Guarantor; and
(8) any Indebtedness or other Obligation, which is, by its
express terms, subordinated in right of payment to any other
Indebtedness or other Obligation of such Guarantor;
provided, if any Guarantor Senior Debt is disallowed under Section 548 of Title
- --------
11, United States Code, or any applicable state fraudulent conveyance law, such
Guarantor Senior Debt shall nevertheless constitute Guarantor Senior Debt for
all purposes of this Indenture.
"Holder" or "Securityholder" means the registered holder of any
------ --------------
Security.
"Holdings" means Salt Holdings Corporation, a Delaware corporation.
--------
"Indebtedness" means with respect to any Person, any indebtedness of
------------
such Person, without duplication, in respect of:
(1) all Obligations of such Person for borrowed money, including,
without limitation, Senior Debt;
(2) all Obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments;
(3) all Capitalized Lease Obligations of such Person;
-16-
(4) the deferred and unpaid purchase price of property, all
conditional sale obligations and all Obligations under any title
retention agreement (but excluding trade accounts payable and other
accrued liabilities arising in the ordinary course of business);
(5) all Obligations for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction;
(6) guarantees and other contingent Obligations in respect of
Indebtedness referred to in clauses (1) through (5) above and clause
(8) below;
(7) all Obligations of any other Person of the type referred to
in clauses (1) through (6) which are secured by any Lien on any
property or asset of such Person, the amount of such Obligations being
deemed to be the lesser of the fair market value of such property or
asset or the amount of the Obligation so secured;
(8) all Obligations under Currency Agreements or Commodity
Agreements and Interest Swap Obligations of such Person; and
(9) all Disqualified Capital Stock issued by such Person with the
amount of Indebtedness represented by such Disqualified Capital Stock
being equal to the greater of its voluntary or involuntary liquidation
preference and its maximum fixed repurchase price, but excluding
accrued dividends, if any.
For purposes hereof, the "maximum fixed repurchase price" of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value shall be determined reasonably and in good
faith by the Board of Directors of the issuer of such Disqualified Capital
Stock. For purposes of Section 4.4, in determining the principal amount of any
Indebtedness to be incurred by the Company or any Restricted Subsidiary or which
is outstanding at any date, the principal amount of any Indebtedness which
provides that an amount less than the principal amount thereof shall be due upon
any declaration of acceleration thereof shall be the accreted value thereof at
the date of determination.
"Indenture" means this Indenture, as amended or supplemented from time
---------
to time in accordance with the terms hereof.
"Independent Financial Advisor" means a firm:
-----------------------------
-17-
(1) which does not have a direct or indirect common equity interest in
the Company; and
(2) which, in the judgment of the Board of Directors of the Company, is
otherwise independent and qualified to perform the task for which it is to
be engaged.
"Initial Notes" means the 10% Senior Subordinated Notes due 2011 of the
-------------
Issuer issued on the Issue Date and authenticated and delivered under this
Indenture pursuant to Section 2.2 and any other notes (other than Exchange
Notes) issued after the Issue Date in accordance with clause (iii) of the fourth
paragraph of Section 2.2.
"Institutional Accredited Investor" has the meaning set forth in Section
---------------------------------
2.16(a).
"Interest Payment Date" means the stated maturity of an installment of
---------------------
interest on the Securities.
"Interest Swap Obligations" means the obligations of any Person pursuant to
-------------------------
any arrangement with any other Person, whereby, directly or indirectly, such
Person is entitled to receive from time to time periodic payments calculated by
applying either a floating or a fixed rate of interest on a stated notional
amount in exchange for periodic payments made by such other Person calculated by
applying a fixed or a floating rate of interest on the same notional amount and
shall include, without limitation, interest rate swaps, caps, floors, collars
and similar agreements.
"Investment" means, with respect to any Person, any direct or indirect loan
----------
or other extension of credit (including, without limitation, a guarantee) 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 by such Person of any Capital Stock,
bonds, notes, debentures or other securities or evidences of Indebtedness issued
by, any Person. "Investment" shall exclude extensions of trade credit by,
prepayment of expenses by, and receivables owing to, the Company and its
Restricted Subsidiaries on commercially reasonable terms in accordance with
normal trade practices of the Company or such Restricted Subsidiary, as the case
may be. For purposes of Section 4.3:
(1) "Investment" shall include and be valued at the fair market value
of the net assets of any Restricted Subsidiary of the Company at the time
that such Restricted Subsidiary is designated an Unrestricted Subsidiary of
the Company and shall exclude the fair market value of the net assets of
any Unrestricted Subsidiary of the Company at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary of the
Company; and
(2) the amount of any Investment shall be the original cost of such
Investment plus the cost of all additional Investments by the Company or
any of its
-18-
Restricted Subsidiaries, without any adjustments for increases or
decreases in value, or write-ups, write-downs or write-offs with respect
to such Investment, reduced by the payment of dividends or distributions
in connection with such Investment or any other amounts received in
respect of such Investment; provided that no such payment of dividends or
distributions or receipt of any such other amounts shall reduce the
amount of any Investment if such payment of dividends or distributions or
receipt of any such amounts would be included in Consolidated Net Income.
If the Company or any Restricted Subsidiary of the Company sells or otherwise
disposes of any Common Stock of any Person that prior to such sale or
disposition was a direct or indirect Restricted Subsidiary of the Company and
after giving effect to any such sale or disposition, ceases to be a Restricted
Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Common Stock of such Person not sold or disposed of.
"Issue Date" means November 28, 2001, the date of original issuance of
----------
the Initial Notes.
"Issuer" means the parties named as such in the first paragraph of this
------
Indenture.
"Legal Defeasance" has the meaning set forth in Section 8.2(b).
----------------
"Lien" means any lien, mortgage, deed of trust, pledge, security
----
interest, charge or encumbrance of any kind (including any conditional sale or
other title retention agreement, any lease in the nature thereof and any
agreement to give any security interest).
"Management Agreement" means the Management Agreement dated as of the
--------------------
Issue Date between the Company and Apollo.
"Maturity Date" means August 15, 2011.
-------------
"Merger Agreement" means the Agreement and Plan of Merger, dated as of
----------------
October 13, 2001, among IMC Global, Inc., Holdings, YBR Holdings LLC and YBR
Acquisition Corp.
"Net Cash Proceeds" means (a) with respect to any Asset Sale, the
-----------------
proceeds in the form of cash or Cash Equivalents including payments in respect
of deferred payment obligations when received in the form of cash or Cash
Equivalents (other than the portion of any such deferred payment constituting
interest) received by the Company or any of its Restricted Subsidiaries from
such Asset Sale net of:
-19-
(1) reasonable out-of-pocket expenses and fees relating to such Asset
Sale (including, without limitation, legal, accounting and investment
banking fees and sales commissions);
(2) taxes paid or payable after taking into account any reduction in
consolidated tax liability due to available tax credits or deductions and
any tax sharing arrangements;
(3) repayment of Indebtedness that is required to be repaid in connection
with such Asset Sale;
(4) appropriate amounts to be provided by the Company or any Restricted
Subsidiary, as the case may be, as a reserve, in accordance with GAAP,
against any liabilities associated with such Asset Sale and retained by the
Company or any Restricted Subsidiary, as the case may be, after such Asset
Sale, including, without limitation, pension and other post-employment
benefit liabilities, liabilities related to environmental matters and
liabilities under any indemnification obligations associated with such
Asset Sale; and
(5) all distributions and other payments required to be made to minority
interest holders in Restricted Subsidiaries or joint ventures as a result
of such Asset Sale;
and (b) 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' or initial purchasers' fees, discounts or
commissions and brokerage, consultant and other fees and expenses actually
incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof.
"Net Proceeds Offer" has the meaning set forth in Section 4.18.
------------------
"Net Proceeds Offer Amount" has the meaning set forth in Section 4.18.
-------------------------
"Net Proceeds Offer Payment Date" has the meaning set forth in Section
-------------------------------
4.18.
"Net Proceeds Offer Trigger Date" has the meaning set forth in Section
-------------------------------
4.18.
"New Domestic Restricted Subsidiary" has the meaning set forth in Section
----------------------------------
4.20.
"Non-payment Default" has the meaning set forth in Section 10.2(b).
-------------------
"Non-U.S. Person" means a person who is not a "U.S. Person" (as defined in
---------------
Regulation S).
-20-
"Obligations" means all obligations for principal, premium, interest,
-----------
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Offering Circular" means the Offering Circular dated November 15, 2001
----------------
relating to the offering of the Initial Notes.
"Officer" means, with respect to any Person, the Chairman of the Board,
-------
the Chief Executive Officer, the President, any Vice President, the Chief
Financial Officer, the Controller, the Treasurer or the Secretary of such
Person.
"Officers' Certificate" means a certificate signed by two Officers of
---------------------
the Issuer or of any Guarantor, as applicable, except that an authentication
order pursuant to Section 2.2 may be signed by only one such officer.
"Offshore Global Securities" has the meaning provided in Section 2.1.
--------------------------
"Offshore Physical Securities" has the meaning provided in Section 2.1.
----------------------------
"Opinion of Counsel" means a written opinion from legal counsel, which
------------------
opinion and counsel are reasonably acceptable to the Trustee.
"Paying Agent" has the meaning set forth in Section 2.3.
------------
"Payment Blockage Notice" has the meaning set forth in Section 10.2(b).
-----------------------
"Payment Default" has the meaning set forth in Section 10.2(a).
---------------
"pay the securities" has the meaning set forth in Section 10.2(a).
------------------
"Permanent Offshore Global Securities" has the meaning provided in
------------------------------------
Section 2.1.
"Permitted Business" means the business of the Company and its
------------------
Restricted Subsidiaries as existing on the Issue Date and any other businesses
that are the same, similar or reasonably related, ancillary or complementary
thereto and reasonable extensions thereof.
"Permitted Holders" means Apollo and other Related Parties.
-----------------
"Permitted Indebtedness" means, without duplication, each of the
----------------------
following:
(1) Indebtedness under the Securities in an aggregate principal
amount not to exceed $250 million and any Guarantees thereof;
-21-
(2) Indebtedness incurred pursuant to the Credit Agreement by the
Company and its Restricted Subsidiaries, in an aggregate principal amount
at any time outstanding not to exceed $360.0 million less the amount of all
repayments of term debt and permanent commitment reductions under the
Credit Agreement with Net Cash Proceeds of Asset Sales applied thereto as
required by Section 4.18(iii); provided that the aggregate principal amount
--------
of Indebtedness permitted to be incurred from time to time under this
clause (2) shall be reduced dollar for dollar by the amount of any
Indebtedness then outstanding under clause (12) below and provided further
that any Indebtedness incurred pursuant to the Credit Agreement on the
Issue Date shall be deemed to be incurred under this clause (2); and
provided further that the amount of Indebtedness permitted to be incurred
pursuant to the Credit Agreement in accordance with this clause (2) shall
be in addition to any Indebtedness to be incurred pursuant to the Credit
Agreement in reliance on and in accordance with clauses (10) and (16)
below;
(3) other Indebtedness of the Company and its Restricted Subsidiaries
outstanding on the Issue Date (including, without limitation, Indebtedness
incurred in connection with the Transactions) reduced by the amount of any
scheduled amortization payments or mandatory prepayments when actually paid
or permanent reductions thereon;
(4) Interest Swap Obligations of the Company covering Indebtedness of
the Company or any of its Restricted Subsidiaries and Interest Swap
Obligations of any Restricted Subsidiary of the Company covering
Indebtedness of the Company or such Restricted Subsidiary; provided,
--------
however, that such Interest Swap Obligations are entered into to protect
-------
the Company and its Restricted Subsidiaries from fluctuations in interest
rates on Indebtedness incurred in accordance with this Indenture to the
extent the notional principal amount of such Interest Swap Obligation does
not exceed the principal amount of the Indebtedness to which such Interest
Swap Obligation relates;
(5) Indebtedness under Currency Agreements; provided that in the case
of Currency Agreements which relate to Indebtedness, such Currency
Agreements do not increase the Indebtedness of the Company and its
Restricted Subsidiaries outstanding other than as a result of fluctuations
in foreign currency exchange rates or by reason of fees, indemnities and
compensation payable thereunder;
(6) Indebtedness of a Restricted Subsidiary of the Company to the
Company or to a Restricted Subsidiary of the Company for so long as such
Indebtedness is held by the Company, a Restricted Subsidiary of the Company
or the lenders or collateral agent under the Credit Agreement, in each case
subject to no Lien held by a Person other than the Company, a Restricted
Subsidiary of the Company or
-22-
the lenders or collateral agent under the Credit Agreement; provided that
if as of any date any Person other than the Company, a Restricted
Subsidiary of the Company or the lenders or collateral agent under the
Credit Agreement owns or holds any such Indebtedness or holds a Lien in
respect of such Indebtedness, such date shall be deemed the incurrence of
Indebtedness not constituting Permitted Indebtedness under this clause (6)
by the issuer of such Indebtedness;
(7) Indebtedness of the Company to a Restricted Subsidiary of the
Company for so long as such Indebtedness is held by a Restricted Subsidiary
of the Company or the lenders or the collateral agent under the Credit
Agreement and is subject to no Lien other than a Lien in favor of the
lenders or collateral agent under the Credit Agreement; provided that (a)
any Indebtedness of the Company to any Restricted Subsidiary of the Company
is unsecured and subordinated, pursuant to a written agreement, to the
Company's obligations under this Indenture and the Securities and (b) if as
of any date any Person other than a Restricted Subsidiary of the Company
owns or holds any such Indebtedness or any Person holds a Lien other than a
Lien in favor of the lenders or collateral agent under the Credit Agreement
in respect of such Indebtedness, such date shall be deemed the incurrence
of Indebtedness not constituting Permitted Indebtedness under this clause
(7) by the Company;
(8) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business; provided, however, that such
-------- -------
Indebtedness is extinguished within two Business Days of incurrence;
(9) Indebtedness of the Company or any of its Restricted Subsidiaries
in respect of performance bonds, bankers' acceptances, workers'
compensation claims, surety or appeal bonds, payment obligations in
connection with self-insurance or similar obligations, and bank overdrafts
(and letters of credit in respect thereof);
(10) Indebtedness represented by Capitalized Lease Obligations,
Purchase Money Indebtedness or Acquired Indebtedness of the Company and its
Restricted Subsidiaries not to exceed $20.0 million in the aggregate at any
one time outstanding; provided that all or a portion of the $20.0 million
permitted to be incurred under this clause (10) may, at the option of the
Company, be incurred under the Credit Agreement or pursuant to clause (16)
below (in addition to the amount set forth therein) instead of pursuant to
Capitalized Lease Obligations, Purchase Money Indebtedness or Acquired
Indebtedness;
(11) Indebtedness arising from agreements of the Company or a
Restricted Subsidiary of the Company providing for indemnification,
adjustment of purchase price or similar obligations, in each case, incurred
or assumed in connection with the
-23-
disposition of any business, assets or a Subsidiary, other than guarantees
by the Company or a Restricted Subsidiary of the Company of Indebtedness
incurred by any Person acquiring all or any portion of such business,
assets or a Subsidiary for the purpose of financing such acquisition;
provided, however, that:
-------- -------
(a) such Indebtedness is not reflected on the balance sheet of
the Company or any Restricted Subsidiary of the Company (contingent
obligations referred to in a footnote to financial statements and not
otherwise reflected on the balance sheet will not be deemed to be reflected
on such balance sheet for purposes of this clause (a)); and
(b) the maximum assumable liability in respect of all such
Indebtedness shall at no time exceed the gross proceeds including the fair
market value of noncash proceeds (the fair market value of such noncash
proceeds being measured at the time they are received as determined in good
faith by the Board of Directors of the Company or the Restricted
Subsidiary, as applicable, and without giving effect to any subsequent
changes in value) actually received by the Company and its Restricted
Subsidiaries in connection with such disposition;
(12) the incurrence by a Receivables Subsidiary of Indebtedness in a
Qualified Receivables Transaction that is without recourse (other than
pursuant to representations, warranties, covenants and indemnities entered
into in the ordinary course of business in connection with a Qualified
Receivables Transaction) to the Company or to any Restricted Subsidiary of
the Company or their assets (other than such Receivables Subsidiary and its
assets), and is not guaranteed by any such Person; provided that any
outstanding Indebtedness incurred under this clause (12) shall reduce (for
so long as, and to the extent that, the Indebtedness referred to in this
clause (12) remains outstanding) the aggregate amount permitted to be
incurred under clause (2) above to the extent set forth therein;
(13) Indebtedness under Commodity Agreements;
(14) guarantees of Indebtedness of (x) any Restricted Subsidiary of
the Company by the Company and its Restricted Subsidiaries, including
agreements of the Company to keep well or maintain financial statement
conditions of any Restricted Subsidiary of the Company and (y) the Company
incurred pursuant to the Credit Agreement or pursuant to clauses (4) and
(5) above by any Restricted Subsidiary of the Company;
(15) Refinancing Indebtedness;
(16) additional Indebtedness of the Company and its Restricted
Subsidiaries in an aggregate principal amount not to exceed $50.0 million
at any one time
-24-
outstanding (which amount may, but need not, be incurred in whole or in
part under the Credit Agreement) plus up to an additional amount as
contemplated by, and to the extent not incurred under, clause (10) above;
and
(17) Indebtedness of the Company or any of its Restricted Subsidiaries
consisting of (x) the financing of insurance premiums in the ordinary
course of business or (y) take-or-pay obligations contained in supply
arrangements entered into in the ordinary course of business and on a basis
consistent with past practice.
For purposes of determining compliance with Section 4.4,
(a) in the event that an item of Indebtedness meets the criteria of
more than one of the categories of Permitted Indebtedness described in
clauses (1) through (17) above or is entitled to be incurred pursuant to
the Consolidated Fixed Charge Coverage Ratio provisions of such Section,
the Company shall, in its sole discretion, classify (or later reclassify)
such item of Indebtedness in any manner that complies with Section 4.4,
(b) accrual of interest, accretion or amortization of original issue
discount, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms or in the form of Capital
Stock, the payment of dividends on Disqualified Capital Stock in the form
of additional shares of the same class of Disqualified Capital Stock and
increases in the amount of Indebtedness outstanding solely as a result of
fluctuations in the exchange rate of currencies will not be deemed to be an
incurrence of Indebtedness or an issuance of Disqualified Capital Stock for
purposes of Section 4.4,
(c) guarantees of, or obligations in respect of letters of credit
relating to, Indebtedness which is otherwise included in the determination
of a particular amount of Indebtedness shall not be included,
(d) if obligations in respect of letters of credit are incurred
pursuant to the Credit Agreement and are being treated as incurred pursuant
to clause (2) above and the letters of credit relate to other Indebtedness,
then such other Indebtedness shall not be included, and
(e) if such Indebtedness is denominated in a currency other than U.S.
dollars, the U.S. dollar equivalent principal amount thereof will be
calculated based on the relevant currency exchange rates in effect on the
date such Indebtedness was incurred.
"Permitted Investments" means:
---------------------
-25-
(1) Investments by the Company or any Restricted Subsidiary of the
Company in any Person that is or will become immediately after such
Investment a Restricted Subsidiary of the Company or that will merge or
consolidate into the Company or a Restricted Subsidiary of the Company;
provided that such Restricted Subsidiary of the Company is not restricted
from making dividends or similar distributions by contract, operation of
law or otherwise other than as permitted by Section 4.13;
(2) Investments in the Company by any Restricted Subsidiary of the
Company; provided that any Indebtedness evidencing such Investment is
unsecured and subordinated, pursuant to a written agreement, to the
Company's obligations under the Securities and this Indenture;
(3) Investments in cash and Cash Equivalents;
(4) loans and advances to employees and officers of the Company and
its Restricted Subsidiaries made (a) in the ordinary course of business for
bona fide business purposes not to exceed $5.0 million in the aggregate at
any one time outstanding or (b) to fund purchases of Capital Stock of the
Company or Holdings under any stock option plan or similar employment
arrangements so long as no cash is actually advanced by the Company or any
of its Restricted Subsidiaries to such employees and officers to fund such
purchases;
(5) Currency Agreements, Commodity Agreements and Interest Swap
Obligations entered into in the ordinary course of the Company's or its
Restricted Subsidiaries' businesses and otherwise in compliance with this
Indenture;
(6) Investments in securities of trade creditors or customers
received (a) pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of such trade creditors or customers or
(b) in settlement of delinquent obligations of, and other disputes with,
customers, suppliers and others, in each case arising in the ordinary
course of business or otherwise in satisfaction of a judgment;
(7) Investments (a) made by the Company or its Restricted
Subsidiaries consisting of consideration received in connection with an
Asset Sale made in compliance with Section 4.18, (b) consisting of
consideration received by the Company or any of its Restricted Subsidiaries
in connection with a transaction that would be an Asset Sale if it
consisted of aggregate consideration received by the Company or any of its
Restricted Subsidiaries of $3.0 million or more or (c) acquired in exchange
for, or out of the proceeds of, a substantially concurrent offering of
Capital Stock (other than Disqualified Capital Stock) of the Company (which
proceeds of any such offering of Capital Stock of the Company shall not
have been, and shall not be, included in clause (3)(b) of the first
paragraph of Section 4.3);
-26-
(8) Investments of a Person or any of its Subsidiaries existing at
the time such Person becomes a Restricted Subsidiary of the Company or at
the time such Person merges or consolidates with the Company or any of its
Restricted Subsidiaries, in either case in compliance with this Indenture;
provided that such Investments were not made by such Person in connection
with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary of the Company or such merger or consolidation;
(9) Investments in the Securities;
(10) Investments in existence on the Issue Date (including, without
limitation, Investments made in connection with the Transactions);
(11) guarantees of Indebtedness to the extent permitted pursuant to
Sections 4.4, 4.15 and 4.20; and
(12) additional Investments (including Investments in joint ventures
and Unrestricted Subsidiaries) not to exceed $35.0 million at any one time
outstanding.
"Permitted Liens" means the following types of Liens:
---------------
(1) Liens for taxes, assessments or governmental charges or claims
either (a) not delinquent or (b) contested in good faith by appropriate
proceedings and as to which the Company or its Restricted Subsidiaries
shall have set aside on its books such reserves, if any, as shall be
required pursuant to (x) GAAP in the case of a Domestic Restricted
Subsidiary, and (y) generally accepted accounting principles in effect from
time to time in the applicable jurisdiction, in the case of a Foreign
Restricted Subsidiary;
(2) statutory and common law Liens of landlords and Liens of
carriers, warehousemen, mechanics, suppliers, materialmen, repairmen,
customs and revenue authorities and other Liens imposed by law incurred in
the ordinary course of business for sums not yet delinquent or being
contested in good faith, if such reserve or other appropriate provision, if
any, as shall be required by GAAP shall have been made in respect thereof;
(3) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security, including any Lien securing letters of
credit issued in the ordinary course of business consistent with past
practice in connection therewith, or to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, government
contracts, performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed money);
-27-
(4) judgment Liens not giving rise to an Event of Default so long as
such Lien is adequately bonded and any appropriate legal proceedings which
may have been duly initiated for the review of such judgment shall not have
been finally terminated or the period within which such proceedings may be
initiated shall not have expired;
(5) licenses, sublicenses, leases, subleases, easements,
rights-of-way, zoning restrictions and other similar charges or
encumbrances in respect of property not interfering in any material respect
with the ordinary conduct of the business of the Company and its Restricted
Subsidiaries, taken as a whole;
(6) any interest or title of a lessor under any Capitalized Lease
Obligation or operating lease; provided that such Liens do not extend to
any property or asset which is not leased property subject to such
Capitalized Lease Obligation or operating lease;
(7) Liens securing Indebtedness permitted pursuant to clause (10) of
the definition of "Permitted Indebtedness"; provided, however, that in the
-------- -------
case of Purchase Money Indebtedness (a) the Indebtedness shall not exceed
the cost of such property or assets and shall not be secured by any
property or assets of the Company or any Restricted Subsidiary of the
Company other than the property and assets so acquired or constructed and
any improvements thereon and (b) the Lien securing such Indebtedness shall
be created within 180 days of such acquisition or construction or, in the
case of a refinancing of any Purchase Money Indebtedness, within 180 days
of such refinancing;
(8) Liens upon specific items of inventory or other goods and
proceeds of any Person securing such Person's obligations in respect of
bankers' acceptances or similar credit transactions issued or created for
the account of such Person to facilitate the purchase, shipment or storage
of such inventory or other goods;
(9) Liens securing reimbursement obligations with respect to
commercial letters of credit which encumber documents and other property
relating to such letters of credit and products and proceeds thereof;
(10) Liens encumbering deposits made to secure obligations arising
from statutory, regulatory, contractual, or warranty requirements of the
Company or any of its Restricted Subsidiaries, including rights of offset
and set-off;
(11) Liens securing Interest Swap Obligations so long as the Interest
Swap Obligations relate to Indebtedness that is otherwise permitted under
this Indenture;
-28-
(12) Liens in the ordinary course of business not exceeding $10.0
million at any one time outstanding that (a) are not incurred in connection
with borrowing money and (b) do not materially detract from the value of
the property or materially impair its use;
(13) Liens by reason of judgment or decree not otherwise resulting in
an Event of Default;
(14) Liens securing Indebtedness permitted to be incurred pursuant to
clauses (12) and (16) of the definition of "Permitted Indebtedness";
(15) Liens securing Indebtedness under Currency Agreements and
Commodity Agreements permitted under this Indenture;
(16) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with
importation of goods;
(17) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for the sale of goods entered into by
the Company or any of its Restricted Subsidiaries in the ordinary course of
business;
(18) Liens securing Acquired Indebtedness incurred in accordance with
Section 4.4 (including, without limitation, clause (10) of the definition
of Permitted Indebtedness); provided that:
(a) such Liens secured such Acquired Indebtedness at the time of
and prior to the incurrence of such Acquired Indebtedness by the
Company or a Restricted Subsidiary of the Company and were not granted
in connection with, or in anticipation of, the incurrence of such
Acquired Indebtedness by the Company or a Restricted Subsidiary of the
Company; and
(b) such Liens do not extend to or cover any property or assets
of the Company or of any of its Restricted Subsidiaries other than the
property or assets that secured the Acquired Indebtedness prior to the
time such Indebtedness became Acquired Indebtedness of the Company or
a Restricted Subsidiary of the Company and are no more favorable to
the lienholders than those securing the Acquired Indebtedness prior to
the incurrence of such Acquired Indebtedness by the Company or a
Restricted Subsidiary of the Company; and
(19) Liens securing insurance premium financing arrangements, provided
--------
that such Lien is limited to the applicable insurance contracts.
-29-
"Person" means an individual, partnership, corporation, limited
------
liability company, unincorporated organization, trust or joint venture, or a
governmental agency or political subdivision thereof or any other entity.
"Physical Securities" has the meaning provided in Section 2.1. Physical
-------------------
Securities are sometimes referred to herein as certificated Securities.
"Preferred Stock" of any Person means any Capital Stock of such Person
---------------
that has preferential rights to any other Capital Stock of such Person with
respect to dividends or redemptions or upon liquidation.
"Private Placement Legend" means the legend initially set forth on the
------------------------
Initial Notes in the form set forth in the first paragraph of Section 2.14.
"Purchase Money Indebtedness" means Indebtedness of the Company and its
---------------------------
Restricted Subsidiaries incurred in the normal course of business for the
purpose of financing all or any part of the purchase price, or the cost of
installation, construction or improvement, of property or equipment or other
related assets and any Refinancing thereof.
"QIB" means any "qualified institutional buyer" (as defined under the
---
Securities Act).
"Qualified Capital Stock" means any Capital Stock that is not
-----------------------
Disqualified Capital Stock.
"Qualified Receivables Transaction" means any transaction or series of
---------------------------------
transactions that may be entered into by the Company or any of its Restricted
Subsidiaries pursuant to which the Company or any of its Restricted Subsidiaries
may sell, convey or otherwise transfer to (1) a Receivables Subsidiary (in the
case of a transfer by the Company or any of its Restricted Subsidiaries) and (2)
any other Person (in the case of a transfer by a Receivables Subsidiary), or may
grant a security interest in, any accounts receivable (whether now existing or
arising in the future) of the Company or any of its Restricted Subsidiaries, and
any assets related thereto including, without limitation, all collateral
securing such accounts receivable, all contracts and all guarantees or other
obligations in respect of such accounts receivable, proceeds of such accounts
receivable and other assets (including contract rights) which are customarily
transferred or in respect of which security interests are customarily granted in
connection with asset securitization transactions involving accounts receivable.
"Recapitalization" means the recapitalization of the Company and
----------------
Holdings on the Issue Date.
"Receivables Subsidiary" means a Wholly Owned Restricted Subsidiary of
----------------------
the Company that engages in no activities other than in connection with the
financing of accounts re-
-30-
ceivable and that is designated by the Board of Directors of the Company (as
provided below) as a Receivables Subsidiary:
(1) no portion of the Indebtedness or any other Obligations--
(contingent or otherwise) of which (a) is guaranteed by the Company or any
Restricted Subsidiary of the Company (excluding guarantees of Obligations
(other than the principal of, premium, if any, and interest on,
Indebtedness) pursuant to representations, warranties, covenants and
indemnities entered into in the ordinary course of business in connection
with a Qualified Receivables Transaction), (b) is recourse to or obligates
the Company or any Restricted Subsidiary of the Company in any way other
than pursuant to representations, warranties, covenants and indemnities
entered into in the ordinary course of business in connection with a
Qualified Receivables Transaction or (c) subjects any property or asset of
the Company or any Restricted Subsidiary of the Company, directly or
indirectly, contingently or otherwise, to the satisfaction thereof, other
than pursuant to representations, warranties, covenants and indemnities
entered into in the ordinary course of business in connection with a
Qualified Receivables Transaction;
(2) with which neither the Company nor any Restricted Subsidiary of
the Company has any material contract, agreement, arrangement or
understanding other than on terms no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from
Persons who are not Affiliates of the Company, other than fees payable in
the ordinary course of business in connection with servicing accounts
receivable; and
(3) with which neither the Company nor any Restricted Subsidiary of
the Company has any obligation to maintain or preserve such Restricted
Subsidiary's financial condition or cause such Restricted Subsidiary to
achieve certain levels of operating results.
Any such designation by the Board of Directors of the Company shall be
evidenced to the Trustee by filing with the Trustee a Board Resolution giving
effect to such designation and an Officers' Certificate certifying that such
designation complied with the foregoing conditions.
"Record Date" means the applicable record date specified in the Securities.
-----------
"Redemption Date," when used with respect to any Security to be redeemed,
---------------
means the date fixed for such redemption pursuant to this Indenture and the
Securities.
"Redemption Price," when used with respect to any Security to be redeemed,
----------------
means the price fixed for such redemption, payable in immediately available
funds, pursuant to this Indenture and the Securities.
-31-
"Reference Date" has the meaning set forth in Section 4.3(c)(i).
--------------
"Refinance" means, in respect of any security or Indebtedness, to
---------
refinance, extend, renew, refund, repay, prepay, redeem, defease or retire, or
to issue a security or Indebtedness in exchange or replacement for, such
security or Indebtedness in whole or in part. "Refinanced" and "Refinancing"
shall have correlative meanings.
"Refinancing Indebtedness" means any Refinancing by the Company or any
------------------------
Restricted Subsidiary of the Company of (A) for purposes of clause (15) of the
definition of Permitted Indebtedness, Indebtedness incurred or existing in
accordance with Section 4.4 (other than pursuant to clause (2), (4), (5), (6),
(7), (8), (9), (10), (11), (12), (13) or (14) of the definition of Permitted
Indebtedness) or (B) for any other purpose, Indebtedness incurred in accordance
with Section 4.4, in each case that does not:
(1) result in an increase in the aggregate principal amount of
Indebtedness of such Person as of the date of such proposed
Refinancing (plus the amount of any premium, accrued interest and
defeasance costs, required to be paid under the terms of the
instrument governing such Indebtedness and plus the amount of
reasonable fees, expenses, discounts and commissions incurred by the
Company in connection with such Refinancing); or
(2) create Indebtedness with (a) if the Indebtedness being
Refinanced was incurred pursuant to clause (3) of the definition of
Permitted Indebtedness, a Weighted Average Life to Maturity that is
less than the Weighted Average Life to Maturity of the Indebtedness
being Refinanced or a final maturity earlier than the final maturity
of the Indebtedness being Refinanced or (b) if the Indebtedness being
Refinanced was otherwise incurred in accordance with the definition of
Permitted Indebtedness or with Section 4.4, a Weighted Average Life to
Maturity that is less than the Weighted Average Life to Maturity of
the Securities or a final maturity earlier than the final maturity of
the Securities; provided that (x) if such Indebtedness being
Refinanced is Indebtedness solely of the Company, then such
Refinancing Indebtedness shall be Indebtedness solely of the Company
and (y) if such Indebtedness being Refinanced is subordinate or junior
to the Securities, then such Refinancing Indebtedness shall be
subordinate to the Securities at least to the same extent and in the
same manner as the Indebtedness being Refinanced.
"Registrar" has the meaning set forth in Section 2.3.
---------
"Registration Rights Agreement" means the Registration Rights
-----------------------------
Agreement, dated November 28, 2001 among the Issuer and Credit Suisse First
Boston Corporation, J.P. Morgan Securities Inc., Deutsche Banc Alex. Brown Inc.
and Credit Lyonnais Securities (USA) Inc.
-32-
"Regulation S" means Regulation S under the Securities Act.
------------
"Related Parties" means with respect to a Person (a) that is a natural
---------------
person (1) any spouse, parent or lineal descendant (including by adoption) of
such Person or (2) the estate of such Person during any period in which such
estate holds Capital Stock of the Company or of Holdings for the benefit of any
Person referred to in clause (a)(1) and (b) that is a trust, corporation,
partnership, limited liability company or other entity, the beneficiaries,
stockholders, partners, owners or Persons beneficially owning an interest of
more than 50% of which consist of such Person and/or such other Persons referred
to in the immediately preceding clause (a).
"Replacement Assets" has the meaning set forth in Section 4.18(iii)(B).
------------------
"Representative" means the indenture trustee or other trustee, agent or
--------------
representative in respect of any Designated Senior Debt; provided that if, and
--------
for so long as, any Designated Senior Debt lacks such a representative, then the
Representative for such Designated Senior Debt shall at all times constitute the
holders of a majority in outstanding principal amount of such Designated Senior
Debt in respect of any Designated Senior Debt.
"Responsible Officer" means, when used with respect to the Trustee, any
-------------------
officer in the Corporate Trust Office of the Trustee with direct responsibility
for the administration of this Indenture or to whom any corporate trust matter
is referred because of such officer's knowledge of and familiarity with the
particular subject.
"Restricted Payment" has the meaning set forth in Section 4.3.
------------------
"Restricted Security" has the meaning assigned to such term in Rule
-------------------
144(a)(3) under the Securities Act; provided that the Trustee shall be entitled
--------
to request and conclusively rely on an Opinion of Counsel with respect to
whether any Security constitutes a Restricted Security.
"Restricted Subsidiary" of any Person means any Subsidiary of such
---------------------
Person which at the time of determination is not an Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
---------
"Sale and Leaseback Transaction" means any direct or indirect
------------------------------
arrangement with any Person or to which any such Person is a party, providing
for the leasing to the Company or a Restricted Subsidiary of any property,
whether owned by the Company or any Restricted Subsidiary at the Issue Date or
later acquired, which has been or is to be sold or transferred by the Company or
such Restricted Subsidiary to such Person or to any other Person from whom funds
have been or are to be advanced by such Person on the security of such property
other than (a) arrangements between the Company and a Wholly Owned Restricted
Subsidiary of
-33-
the Company or between Wholly Owned Restricted Subsidiaries of the Company or
(b) any arrangement whereby the transfer involves fixed or capital assets and is
consummated within 120 days after the date the Company or a Restricted
Subsidiary acquires or finishes construction of such fixed or capital assets.
"Securities" means the Initial Notes, the Exchange Notes and any other
----------
notes issued after the Issue Date in accordance with clause (iii) of the fourth
paragraph of Section 2.2 treated as a single class of securities, as amended or
supplemented from time to time in accordance with the terms hereof, that are
issued pursuant to this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, or any
--------------
successor statute or statutes thereto.
"Senior Debt" means the principal of, premium, if any, and accrued and
-----------
unpaid interest (including any interest accruing subsequent to the filing of a
petition of bankruptcy or other like proceeding at the rate provided for in the
documentation with respect thereto, whether or not such interest is an allowed
claim under applicable law) on any Indebtedness of the Issuer, whether
outstanding on the Issue Date or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the instrument creating or
evidencing the same or pursuant to which the same is outstanding expressly
provides that such Indebtedness shall not be senior in right of payment to the
Securities. Without limiting the generality of the foregoing, "Senior Debt"
shall also include the principal of, premium, if any, interest (including any
interest accruing subsequent to the filing of petition of bankruptcy or other
like proceeding at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on, and all other amounts owing by the Issuer in respect of,
(x) all obligations of every nature (including guarantees
thereof) of the Issuer under, or with respect to, the Credit Agreement,
including, without limitation, obligations to pay principal, premium,
if any, and interest, reimbursement obligations under letters of
credit, fees, expenses and indemnities;
(y) all Interest Swap Obligations (including guarantees
thereof); and
(z) all obligations under Currency Agreements and Commodity
Agreements (including guarantees thereof), in each case whether
outstanding on the Issue Date or thereafter incurred.
Notwithstanding the foregoing, "Senior Debt" shall not include:
(1) any Indebtedness of the Company to a Subsidiary of the
Company;
-34-
(2) Indebtedness to, or guaranteed on behalf of, any director, officer
or employee of the Company or any director, officer or employee of any
Subsidiary of the Company (including, without limitation, amounts owed for
compensation);
(3) Indebtedness or other liabilities to trade creditors and other
amounts incurred in connection with obtaining goods, materials or services
(other than if incurred under the Credit Agreement);
(4) Indebtedness represented by Disqualified Capital Stock or in
respect of Capital Stock;
(5) any liability for federal, state, local or other taxes owed or
owing by the Issuer;
(6) that portion of any Indebtedness incurred in violation of Section
4.4 (but, as to any such obligation, no such violation shall be deemed to
exist for purposes of this clause (6) if the holder(s) of such obligation
or their representative shall have received an Officers' Certificate of the
Company to the effect that the incurrence of such Indebtedness does not
(or, in the case of revolving credit Indebtedness, that the incurrence of
the entire committed amount thereof at the date on which the initial
borrowing thereunder is made would not) violate such provisions of this
Indenture);
(7) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Title 11, United States Code, is without
recourse to the Issuer; and
(8) any Indebtedness or other Obligation which is, by its express
terms, subordinated in right of payment to any of the Company's other
Indebtedness or other Obligation.
provided, if any Senior Debt is disallowed under Section 548 of Title 11, United
- --------
States Code, or any applicable state fraudulent conveyance law, such Senior Debt
shall nevertheless constitute Senior Debt for all purposes of this Indenture.
"Senior Subordinated Debt" means, with respect to a Person, the Securities
------------------------
and any other Indebtedness of such Person that specifically provides that such
Indebtedness is to rank pari passu with the Securities in right of payment and
is not subordinated by its terms in right of payment to any Indebtedness or
other obligations of such Person which is not Senior Debt of such Person.
"Significant Subsidiary," with respect to any Person, means any Restricted
----------------------
Subsidiary of such Person that satisfies the criteria for a "significant
subsidiary" as defined in Regulation S-X under the Securities Act as such
Regulation is in effect on the Issue Date and (2) any Re-
-35-
stricted Subsidiary that, when aggregated with all other Restricted Subsidiaries
that are not otherwise Significant Subsidiaries and as to which any event
described in Section 6.1 clause (v), (vi),(vii) or (viii) has occurred and is
continuing, would constitute a Significant Subsidiary under clause (1) of this
definition.
"Subsidiary," with respect to any Person, means:
----------
(1) any corporation of which the outstanding Capital Stock having
at least a majority of the votes entitled to be cast in the election
of directors under ordinary circumstances shall at the time be owned,
directly or indirectly, by such Person or a Subsidiary of such Person;
or
(2) any other Person of which at least a majority of the voting
interest under ordinary circumstances is at the time, directly or
indirectly, owned by such Person or a Subsidiary of such Person.
"Surviving Entity" has the meaning set forth in Section 5.1(a)(i).
----------------
"Temporary Offshore Global Securities" has the meaning set forth in
------------------------------------
Section 2.1.
"TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939
--- -------------------
(15 U.S.C. (s)(s) 77aaa-77bbbb), as amended, as in effect on the date of
the execution of this Indenture until such time as this Indenture is qualified
under the TIA, and thereafter as in effect on the date on which this Indenture
is qualified under the TIA, except as otherwise provided in Section 9.4.
"Transaction Date" has the meaning specified in the definition of
----------------
"Consolidated Fixed Charge Coverage Ratio."
"Transactions" means the offering of the Initial Notes, the
------------
Recapitalization and the related borrowings under the Credit Agreement on the
Issue Date.
"Treasury Rate" means the rate per annum equal to the yield to maturity
-------------
at the time of computation of United States Treasury securities with a constant
maturity most nearly equal to the period from such date of redemption to August
15, 2006; provided, however, that if the period from such date of redemption to
-------- -------
August 15, 2006 is not equal to the constant maturity of the United States
Treasury security for which a weekly average yield is given, the Treasury Rate
shall be obtained by linear interpolation (calculated to the nearest one-twelfth
of a year) from the weekly average yields of United States Treasury securities
for which such yields are given, except that if the period from such date of
redemption to August 15, 2006 is less than one year, the weekly average yield on
actually traded United States Treasury securities adjusted to a constant
maturity of one year shall be used.
-36-
"Trustee" means the party named as such in this Indenture until a
-------
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Unrestricted Subsidiary" of any Person means (1) any Subsidiary of
-----------------------
such Person that at the time of determination shall be or continue to be
designated an Unrestricted Subsidiary by the Board of Directors of such Person
in the manner provided below and (2) any Subsidiary of an Unrestricted
Subsidiary. The Board of Directors may designate any Subsidiary (including any
newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary
unless such Subsidiary owns any Capital Stock of, or owns or holds any Lien on
any property of, the Company or any other Subsidiary of the Company that is not
a Subsidiary of the Subsidiary to be so designated; provided that (x) either (i)
--------
the Company certifies to the Trustee in an Officers' Certificate that such
designation complies with Section 4.3 or (ii) the Subsidiary to be so designated
at the time of designation has total consolidated assets of $1,000 or less and
(y) each Subsidiary to be so designated and each of its Subsidiaries has not at
the time of designation, and does not thereafter, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable with respect to any
Indebtedness pursuant to which the lender has recourse to any of the assets of
the Company or any of its Restricted Subsidiaries (other than the assets of such
Unrestricted Subsidiary). The Board of Directors may designate any Unrestricted
Subsidiary to be a Restricted Subsidiary only if (x) immediately after giving
effect to such designation, the Company is able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in compliance with
Section 4.4 and (y) immediately before and immediately after giving effect to
such designation, no Default or Event of Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be evidenced to
the Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing provisions.
"U.S. Global Securities" has the meaning provided in Section 2.1.
----------------------
"U.S. Government Obligations" means direct obligations of, and
---------------------------
obligations guaranteed by, the United States of America 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.
"U.S. Legal Tender" means such coin or currency of the United States of
-----------------
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"U.S. Physical Securities" means the Securities issued in the form of
------------------------
permanent certificated Securities in registered form in substantially the form
set forth in Exhibit A to Institutional Accredited Investors which are not QIBs
(excluding Non-U.S. Persons) who purchased Securities pursuant to Regulation D
of the Securities Act.
-37-
"Weighted Average Life to Maturity" means, when applied to any
---------------------------------
Indebtedness at any date, the number of years obtained by dividing (1) the then
outstanding aggregate principal amount of such Indebtedness into (2) the sum of
the total of the products obtained by multiplying (a) the amount of each then
remaining installment, sinking fund, serial maturity or other required payment
of principal, including payment at final maturity, in respect thereof, by (b)
the number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.
"Wholly Owned Restricted Subsidiary" of any Person means any Restricted
----------------------------------
Subsidiary of such Person of which all the outstanding voting securities (other
than in the case of a Foreign Restricted Subsidiary, directors' qualifying
shares or an immaterial amount of shares required to be owned by other Persons
pursuant to applicable law) are owned by such Person or any Wholly Owned
Restricted Subsidiary of such Person.
1.2. Incorporation By Reference of TIA.
---------------------------------
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Securities.
--------------------
"indenture security holder" means a Holder or a
-------------------------
Securityholder.
"indenture to be qualified" means this Indenture.
-------------------------
"indenture trustee" or "institutional trustee" means the
----------------- ---------------------
Trustee.
"obligor" on the indenture securities means the Company, any
-------
Guarantor or any other obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule and
not otherwise defined herein have the meanings assigned to them therein.
1.3. Rules of Construction.
---------------------
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
-38-
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural, and words in the plural
include the singular;
(6) provisions apply to successive events and transactions; and
(7) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
(8) all ratios and computations based on GAAP contained in this
Indenture shall be computed in accordance with the definition of GAAP set
forth in Section 1.1.
(9) all references to Sections or Articles refer to Sections or
Articles in this Indenture unless otherwise indicated.
ARTICLE II
THE SECURITIES
2.1. Form and Dating.
---------------
The Initial Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A and the Exchange Notes and the Trustee's
---------
certificate of authentication shall be substantially in the form of Exhibit B.
---------
The Securities may have notations, legends or endorsements required by law,
stock exchange rule or usage. The Issuer and the Trustee shall approve the form
of the Securities and any notation, legend or endorsement on them. Each Security
shall be dated the date of its authentication.
The terms and provisions contained in the Securities, annexed hereto as
Exhibits A and B, and the Guarantees, annexed hereto as Exhibit E, shall
- ---------- - ---------
constitute, and are hereby expressly made, a part of this Indenture and, to the
extent applicable, the Issuer, the Guarantors, and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Securities offered and sold in reliance on Rule 144A shall be issued
initially in the form of one or more permanent global Securities in registered
form, substantially in the form set forth in Exhibit A (the "U.S. Global
--------- -----------
Securities"), deposited with the Trustee, as custodian for the Depository, duly
- ----------
executed by the Issuer and authenticated by the Trustee as hereinafter provided,
and shall bear the legends set forth in Section 2.14. The aggregate principal
amount
-39-
of the U.S. Global Securities may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depository,
as hereinafter provided.
Securities issued in exchange for interests in the U.S. Global Securities
pursuant to Section 2.15 may be issued in the form of permanent certificated
Securities in registered form and shall bear the first legend set forth in
Section 2.14.
Securities offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of one or more temporary
global Securities in registered form substantially in the form set forth in
Exhibit A (the "Temporary Offshore Global Securities"), registered in the name
- --------- ------------------------------------
of the nominee of the Depository, deposited with the Trustee, as custodian for
the Depository, duly executed by the Issuer and authenticated by the Trustee as
hereinafter provided and shall bear the legends set forth in Section 2.14. At
any time on or after the 41st day after the Issue Date, upon receipt by the
Trustee, Registrar and the Issuer of a certificate substantially in the form of
Exhibit D hereto, one or more permanent global Securities in registered form
substantially in the form set forth in Exhibit A (the "Permanent Offshore Global
-------------------------
Securities"; and together with the Temporary Offshore Global Securities, the
- ----------
"Offshore Global Securities"), duly executed by the Issuer and authenticated by
--------------------------
the Trustee as hereinafter provided shall be deposited with the Trustee, as
custodian for the Depository or its nominee, and the Registrar shall reflect on
its books and records the date and a decrease in the principal amount of the
Temporary Offshore Global Securities in an amount equal to the principal amount
of the beneficial interest in the Temporary Offshore Global Securities
transferred. The aggregate principal amount of the Offshore Global Securities
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depository, as hereinafter
provided.
Securities issued in exchange for interests in the Offshore Global
Securities pursuant to Section 2.15 may be issued in the form of permanent
certificated Securities in registered form (the "Offshore Physical Securities")
----------------------------
and shall bear the first legend set forth in Section 2.14. All Securities
offered and sold in reliance on Regulation S shall remain in the form of an
Offshore Global Security until the consummation of the Exchange Offer pursuant
to the Registration Rights Agreement.
The Offshore Physical Securities and the U.S. Physical Securities are
sometimes collectively herein referred to as the "Physical Securities." The U.S.
-------------------
Global Securities and the Offshore Global Securities are sometimes referred to
herein as the "Global Securities."
-----------------
2.2. Execution and Authentication.
----------------------------
One Officer or an Assistant Secretary, of the Issuer (each of whom shall,
in each case, have been duly authorized by all requisite corporate actions)
shall sign the Securities for the Issuer by manual or facsimile signature.
-40-
If an Officer whose signature is on a Security was an Officer at the time
of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall nevertheless be valid.
A Security shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Security. The signature
shall be conclusive evidence that the Security has been authenticated under this
Indenture.
The Trustee shall authenticate (i) Initial Notes for original issue on the
Issue Date in the aggregate principal amount not to exceed $250,000,000, (ii)
pursuant to the Exchange Offer, Exchange Notes from time to time for issue only
in exchange for a like principal amount of Initial Notes and (iii) subject to
compliance with Section 4.4, one or more series of Securities for original issue
after the Issue Date (such Securities to be substantially in the form of Exhibit
-------
A or B, as the case may be) in an unlimited amount (and if in the form of
- - -
Exhibit A the same principal amount of Exchange Notes in exchange therefor upon
- ---------
consummation of a registered exchange offer), in each case upon written orders
of the Issuer in the form of an Officers' Certificate, which Officers'
Certificate shall, in the case of any issuance pursuant to clause (iii) above,
certify that such issuance is in compliance with Section 4.4. In addition, each
such Officers' Certificate shall specify the amount of Securities to be
authenticated, the date on which the Securities are to be authenticated, whether
the Securities are to be Initial Notes, Exchange Notes or Securities issued
under clause (iii) of the preceding sentence and the aggregate principal amount
of Securities outstanding on the date of authentication, and shall further
specify the amount of such Securities to be issued as a Global Security or
Physical Securities. Such Securities shall initially be in the form of one or
more Global Securities, which (i) shall represent, and shall be denominated in
an amount equal to the aggregate principal amount of, the Securities to be
issued, (ii) shall be registered in the name of the Depository for such Global
Security or Securities or its nominee and (iii) shall be delivered by the
Trustee to the Depository or pursuant to the Depository's instruction. All
Securities issued under this Indenture shall vote and consent together on all
matters as one class and no series of Securities will have the right to vote or
consent as a separate class on any matter.
The Trustee may appoint an authenticating agent reasonably acceptable to
the Issuer to authenticate the Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Issuer and Affiliates of the Issuer.
The Securities shall be issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof.
-41-
2.3. Registrar and Paying Agent.
--------------------------
The Issuer shall maintain an office or agency in the Borough of Manhattan,
The City of New York, where (a) Securities may be presented or surrendered for
registration of transfer or for exchange ("Registrar"), (b) Securities may be
---------
presented or surrendered for payment ("Paying Agent") and (c) notices and
------------
demands to or upon the Issuer in respect of the Securities and this Indenture
may be served. The Issuer may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
- -------- -------
relieve the Issuer of their obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Issuer may
act as its own Registrar or Paying Agent except that for the purposes of
Articles Three and Eight and Sections 4.17 and 4.18, neither the Issuer nor any
Affiliate of the Issuer shall act as Paying Agent. The Registrar shall keep a
register of the Securities and of their transfer and exchange. The Issuer, upon
notice to the Trustee, may have one or more co-Registrars and one or more
additional paying agents reasonably acceptable to the Trustee. The term "Paying
------
Agent" includes any additional paying agent. The Issuer hereby initially
- -----
appoints the Trustee as Registrar and Paying Agent until such time as the
Trustee has resigned or a successor has been appointed.
The Issuer shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which agreement shall implement the provisions of
this Indenture that relate to such Agent. The Issuer shall notify the Trustee,
in advance, of the name and address of any such Agent. If the Issuer fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such.
The Trustee is authorized to enter into a letter of representations with
the Depository in the form provided by the Issuer and to act in accordance with
such letter.
2.4. Paying Agent To Hold Assets In Trust.
------------------------------------
The Issuer shall require each Paying Agent other than the Trustee to agree
in writing that, subject to Article Ten, each Paying Agent shall hold in trust
for the benefit of Holders or the Trustee all assets held by the Paying Agent
for the payment of principal of, premium, if any, or interest on, the Securities
(whether such assets have been distributed to it by the Issuer or any other
obligor on the Securities), and shall notify the Trustee of any Default or Event
of Default by the Issuer (or any other obligor on the Securities) in making any
such payment. If either the Issuer or a Subsidiary acts as Paying Agent, it
shall segregate such assets and hold them as a separate trust fund. The Issuer
at any time may require a Paying Agent to distribute all assets held by it to
the Trustee and account for any assets disbursed and the Trustee may at any time
during the continuance of any payment Default or payment Event of Default, upon
written request to a Paying Agent, require such Paying Agent to distribute all
assets held by it to the Trustee and to account for any assets distributed. Upon
distribution to the Trustee of all
-42-
assets that shall have been delivered by the Issuer to the Paying Agent, the
Paying Agent shall have no further liability for such assets.
2.5. 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 Issuer shall furnish to the
Trustee on or 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, which list
may be conclusively relied upon by the Trustee.
2.6. Transfer and Exchange.
---------------------
(a) Subject to the provisions of Sections 2.14 and 2.15, when Securities
are presented to the Registrar or a co-Registrar with a request to register the
transfer of such Securities or to exchange such Securities for an equal
principal amount of Securities of other authorized denominations, the Registrar
or co-Registrar shall register the transfer or make the exchange as requested if
its requirements for such transaction are met; provided, however, that the
-------- -------
Securities surrendered for registration of transfer or exchange shall be duly
endorsed or accompanied by a written instrument of transfer in form satisfactory
to the Issuer and the Registrar or co-Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing. To permit registrations of
transfers and exchanges, the Issuer shall execute and the Trustee shall
authenticate Securities at the Registrar's or co-Registrar's request. No service
charge shall be made for any registration of transfer or exchange, but the
Issuer may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge payable upon exchanges or
transfers pursuant to Section 2.2, 2.10, 3.6, 4.17, 4.18 or 9.6). The Registrar
or co-Registrar shall not be required to register the transfer of or exchange of
any Security (i) during a period beginning at the opening of business 15 days
before the mailing of a notice of redemption of Securities and ending at the
close of business on the day of such mailing, (ii) selected for redemption in
whole or in part pursuant to Article Three, except the unredeemed portion of any
Security being redeemed in part, and (iii) during a Change of Control Offer or a
Net Proceeds Offer if such Security is tendered pursuant to such Change of
Control Offer or Net Proceeds Offer and not withdrawn. A Global Security may be
transferred, in whole but not in part, in the manner provided in this Section
2.6(a), only to a nominee of the Depository for such Global Security, or to the
Depository, or a successor Depository for such Global Security selected or
approved by the Issuer, or to a nominee of such successor Depository.
(b) If at any time the Depository for the Global Security or Securities
notifies the Issuer that it is unwilling or unable to continue as Depository for
such Global Security or Securities or the Issuer becomes aware that the
Depository has ceased to be a clearing agency reg-
-43-
istered under the Exchange Act, the Issuer shall appoint a successor Depository
with respect to such Global Security or Securities. If a successor Depository
for such Global Security or Securities has not been appointed within 90 days
after the Issuer receives such notice or become aware of such ineligibility, the
Issuer shall execute, and the Trustee, upon receipt of an Officers' Certificate
for the authentication and delivery of Securities, shall authenticate and make
available for delivery, Securities in definitive form, in an aggregate principal
amount at maturity equal to the principal amount at maturity of the Global
Security representing such Securities, in exchange for such Global Security. The
Issuer shall reimburse the Registrar, the Depository and the Trustee for
expenses they incur in documenting such exchanges and issuances of Securities in
definitive form.
The Issuer may at any time and in their sole discretion determine that
the Securities shall no longer be represented by such Global Security or
Securities. In such event the Issuer will execute, and the Trustee, upon receipt
of a written order for the authentication and delivery of individual Securities
in exchange in whole or in part for such Global Security or Securities, will
authenticate and make available for delivery individual Securities in definitive
form in an aggregate principal amount equal to the principal amount of such
Global Security or Securities in exchange for such Global Security or
Securities.
In any exchange provided for in any of the preceding two paragraphs,
the Issuer will execute and the Trustee will authenticate and make available for
delivery individual Securities in definitive registered form in authorized
denominations. Upon the exchange of a Global Security for individual Securities,
such Global Security shall be cancelled by the Trustee. Securities issued in
exchange for a Global Security pursuant to this Section 2.6(b) shall be
registered in such names and in such authorized denominations as the Depository
for such Global Security, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. The Trustee shall make
available for delivery such Securities to the Persons in whose names such
Securities are so registered.
Neither the Issuer, the Trustee, any Paying Agent or the Registrar will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests in a Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
2.7. Replacement Securities.
----------------------
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Issuer shall issue and the Trustee shall authenticate a replacement
Security if the Trustee's requirements are met. If required by the Trustee or
the Issuer, such Holder must provide an indemnity bond or other indemnity,
sufficient in the judgment of both the Issuer and the Trustee, to protect the
Issuer, the Trustee or any Agent from any loss which any of them may suffer if a
Security is replaced. The Issuer may charge such Holder for its reasonable
out-of-pocket expenses in re-
-44-
placing a Security pursuant to this Section 2.7, including reasonable fees and
expenses of counsel.
Every replacement Security is an additional obligation of the Issuer.
2.8. Outstanding Securities.
----------------------
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee except those cancelled by it, those delivered
to it for cancellation and those described in this Section as not outstanding. A
Security does not cease to be outstanding because the Issuer, any Guarantor or
any of their respective Subsidiaries or Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.7 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser or a protected purchaser. A mutilated Security
---- ----
ceases to be outstanding upon surrender of such Security and replacement thereof
pursuant to Section 2.7. If the principal amount of any Security is considered
paid under Section 4.1, it ceases to be outstanding and interest ceases to
accrue.
If on a Redemption Date or the Maturity Date the Paying Agent (other
than the Issuer or a Subsidiary) holds U.S. Legal Tender sufficient to pay all
of the principal, premium, if any, and interest due on the Securities payable on
that date, then on and after that date such Securities cease to be outstanding
and interest on them ceases to accrue.
2.9. Treasury Securities.
-------------------
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Issuer, any of its Subsidiaries or any of its respective Affiliates shall
be disregarded, except that, for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities that a Responsible Officer of the Trustee knows or has reason to know
are so owned shall be disregarded.
2.10. Temporary Securities.
--------------------
Until definitive Securities are ready for delivery, the Issuer 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 Issuer considers appropriate for temporary Securities,
as evidenced by execution of such temporary Securities by the Issuer. Without
unreasonable delay, the Issuer shall prepare and the Trustee shall authenticate
definitive Securities in exchange for temporary Securities. Until such exchange,
temporary Securities shall be entitled to the same rights, benefits and
privileges as definitive Securities. Not-
-45-
withstanding the foregoing, so long as the Securities are represented by a
Global Security, such Global Security may be in typewritten form.
2.11. Cancellation.
------------
The Issuer at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee, or at the direction of the Trustee, the Registrar or the
Paying Agent (other than the Issuer or a Subsidiary), and no one else, shall
cancel and shall dispose of all Securities surrendered for registration of
transfer, exchange, payment or cancellation. Subject to Section 2.7, the Issuer
may not issue new Securities to replace Securities that they have paid or
delivered to the Trustee for cancellation. If the Issuer or any Guarantor shall
acquire any of the Securities, such acquisition shall not operate as a
redemption or satisfaction of the Indebtedness represented by such Securities
unless and until the same are surrendered to the Trustee for cancellation
pursuant to this Section 2.11.
2.12. Defaulted Interest.
------------------
If the Issuer defaults in a payment of interest on the Securities, it
shall, unless the Trustee fixes another record date pursuant to Section 6.10,
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest, in any lawful manner. The Issuer may pay the defaulted
interest to the Persons who are Holders on a subsequent special record date,
which date shall be the fifteenth day next preceding the date fixed by the
Issuer for the payment of defaulted interest or the next succeeding Business Day
if such date is not a Business Day. At least 15 days before any such subsequent
special record date, the Issuer shall mail to each Holder, with a copy to the
Trustee, a notice that states the subsequent special record date, the payment
date and the amount of defaulted interest, and interest payable on such
defaulted interest, if any, to be paid.
2.13. CUSIP and ISIN Numbers.
----------------------
The Issuer in issuing the Securities may use "CUSIP" and "ISIN"
----- ----
numbers, and if so, the Trustee shall use the CUSIP numbers in notices of
redemption or exchange as a convenience to Holders; provided, however, that any
-------- -------
such notice may state that no representation is made as to the correctness or
accuracy of the CUSIP and ISIN numbers printed in the notice or on the
Securities, and that reliance may be placed only on the other identification
numbers printed on the Securities and that any such redemption or exchange shall
not be affected by any defect or omission of such CUSIP and ISIN numbers. The
Issuer will promptly notify the Trustee of any change in CUSIP or ISIN number.
-46-
2.14. Restrictive Legends.
-------------------
Unless and until a Security is exchanged for an Exchange Note or sold
in connection with an effective registration statement under the Securities Act
pursuant to the Registration Rights Agreement, (i) the U.S. Global Securities
and U.S. Physical Securities shall bear the legend set forth below (the "Private
-------
Placement Legend") on the face thereof and (ii) the Offshore Physical
- --------- ------
Securities, until at least the 41st day after the Issue Date and receipt by the
Issuer and the Trustee of a certificate substantially in the form of Exhibit D
hereto, and the Temporary Offshore Global Securities shall bear the legend set
forth below on the face thereof.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
--------------
OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
-----------------------------
SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT (AN "INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS
---------------------------------
NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,
(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO IN RULE
144(k) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE
TRANSFER OF THIS SECURITY, RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) INSIDE THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF
WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE) AND IF SUCH TRANSFER IS
IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF SECURITIES OF LESS THAN
$100,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (D) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904
UNDER THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
-47-
STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO
EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS
SECURITY WITHIN THE TIME PERIOD REFERRED TO IN RULE 144(k) UNDER THE
SECURITIES ACT AFTER THE ORIGINAL ISSUANCE OF THE SECURITIES, THE
HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF
RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO
THE TRUSTEE. IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED
INVESTOR OR NON-U.S. PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE AND THE ISSUER SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE
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. AS USED HEREIN, THE TERMS "OFFSHORE
--------
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANING GIVEN
----------- ------------- -----------
TO THEM BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE
CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY
TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING RESTRICTION.
Each Global Security shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE
BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH
NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH
SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A
NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE IS
PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
---
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
-48-
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTION 2.16 OF THE INDENTURE GOVERNING
THIS SECURITY.
2.15. Book-Entry Provisions For Global Security.
-----------------------------------------
(a) Each Global Security initially shall (i) be registered in the name
of the Depository or the nominee of such Depository, (ii) be delivered to the
Trustee as custodian for such Depository and (iii) bear legends as set forth in
Section 2.14.
Members of, or participants in, the Depository ("Agent Members") shall
-------------
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depository, or the Trustee as its custodian, or under any
Global Security, and the Depository may be treated by the Issuer, the Trustee
and any agent of the Issuer or the Trustee as the absolute owner of each Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Issuer, the Trustee or any agent of the Issuer or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depository or impair, as between the Depository
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their respective
nominees. Interests of beneficial owners in any Global Security may be
transferred or, subject to Section 2.1, exchanged for Physical Securities in
accordance with the rules and procedures of the Depository and the provisions of
Section 2.16. In addition, U.S. Physical Securities and Offshore Physical
Securities shall be transferred to all beneficial owners in exchange for their
beneficial interests in U.S. Global Securities or Offshore Global Securities, as
the case may be, if (i) the Depository notifies the Issuer that it is unwilling
or unable to continue as Depository for the U.S. Global Securities or the
Offshore Global Securities and a successor depositary is not appointed by the
Issuer within 90 days of such notice or (ii) an Event of Default has occurred
and is continuing and the Registrar has received a written request from the
Depository or the Trustee to issue Physical Securities.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Security to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Physical Securities are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of such Global Security in an amount equal to the principal
amount of the beneficial interest in such Global Security to be transferred, and
the Issuer shall execute, and the Trustee shall authenticate and make available
for delivery, one or more U.S.
-49-
Physical Securities or Offshore Physical Securities, as the case may be, of like
tenor and amount.
(d) In connection with the transfer of U.S. Global Securities or
Offshore Global Securities, in whole, to beneficial owners pursuant to paragraph
(b), the U.S. Global Securities or the Offshore Global Securities, as the case
may be, shall be deemed to be surrendered to the Trustee for cancellation, and
the Issuer shall execute, and the Trustee shall authenticate and make available
for delivery, to each beneficial owner identified by the Depository in exchange
for its beneficial interest in such U.S. Global Securities or Offshore Global
Securities, as the case may be, an equal aggregate principal amount of U.S.
Physical Securities or Offshore Physical Securities, as the case may be, of
authorized denominations.
(e) Any Physical Security constituting a Restricted Security delivered
in exchange for an interest in a Global Security pursuant to paragraph (b) or
(c) shall, except as otherwise provided by paragraphs (a)(i)(x), (d), (e)(ii)
and (f) of Section 2.16, bear the legend regarding transfer restrictions
applicable to the Physical Securities set forth in Section 2.14.
(f) The 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.
2.16. Special Transfer Provisions.
---------------------------
(a) Transfers to Non-QIB Institutional Accredited Investors. The
-------------------------------------------------------
following provisions shall apply with respect to the registration of any
proposed transfer of a Security constituting a Restricted Security to any
institutional accredited investor (as defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act) (an "Accredited Investor" or an "Institutional
------------------- -------------
Accredited Investor") which is not a QIB (excluding Non-U.S. Persons):
- -------------------
(i) the Registrar shall register the transfer of any
Security constituting a Restricted Security, whether or not such
Security bears the Private Placement Legend, if (x) the transferee
certifies that it is not an Affiliate of the Issuer and the requested
transfer is after the second anniversary of the later of the (a) Issue
Date and (b) the last date on which the Issuer or an Affiliate of the
Issuer was the owner of such Security (or any predecessor Security) or
such shorter period of time as permitted by Rule 144(k) under the
Securities Act or any successor provision thereunder or (y) the
proposed transferee has delivered to the Registrar a certificate
substantially in the form of Exhibit C hereto and if such transfer is
---------
in respect of an aggregate principal amount of Securities of less than
$100,000, the proposed transferee has delivered to the Registrar and
the Issuer an opinion of counsel acceptable to the Issuer that such
transfer is in compliance with the Securities Act and such other
certifications, legal opinions or other information that the Trustee
may reasonably request in order to confirm that
-50-
such transaction is being made pursuant to an exemption from or in a
transaction not subject to the registration requirements of the Securities
Act; and
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in the U.S. Global Security, the Registrar shall
register the transfer of any Security constituting a Restricted Security,
whether or not such Security bears a Private Placement Legend upon receipt
by the Registrar of (x) the certificate, if any, required by paragraph (i)
above and (y) instructions given in accordance with the Depository's and
the Registrar's procedures, whereupon (a) the Registrar shall reflect on
its books and records the date and (if the transfer does not involve a
transfer of outstanding U.S. Physical Securities) a decrease in the
principal amount of the applicable U.S. Global Security in an amount equal
to the principal amount of the beneficial interest in such U.S. Global
Security to be transferred, and (b) the Issuer shall execute and the
Trustee shall authenticate and make available for delivery one or more U.S.
Physical Securities of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with respect
-----------------
to the registration of any proposed transfer of a Security to a QIB (excluding
transfers to Non-U.S. Persons):
(i) if the Security to be transferred consists of (x) either
Offshore Physical Securities prior to the removal of the Private Placement
Legend or U.S. Physical Securities, the Registrar shall register the
transfer if such transfer is being made by a proposed transferor who has
checked the box provided for on the form of Security stating, or has
otherwise advised the Issuer and the Registrar in writing, that the sale
has been made in compliance with the provisions of Rule 144A to a
transferee who has signed the certification provided for on the form of
Security stating, or has otherwise advised the Issuer and the Registrar in
writing, that it is purchasing the 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 QIB within the meaning of Rule 144A, 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 Issuer as
it 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
its foregoing representations in order to claim the exemption from
registration provided by Rule 144A or (y) an interest in the U.S. Global
Securities, the transfer of such interest may be effected only through the
book entry system maintained by the Depository; and
(ii) if the proposed transferee is an Agent Member, and the
Securities to be transferred consist of U.S. Physical Securities which
after transfer are to be evidenced by an interest in a U.S. Global
Security, upon receipt by the Registrar of instructions given in accordance
with the Depository's and the Registrar's procedures, the Regis-
-51-
trar shall reflect on its books and records the date and an increase in
the principal amount of the applicable U.S. Global Security in an
amount equal to the principal amount of the U.S. Physical Securities to
be transferred, and the Trustee shall cancel the U.S. Physical
Securities so transferred.
(c) Transfers of Interests in the Temporary Offshore Global Securities.
------------------------------------------------------------------
The following provisions shall apply with respect to registration of any
proposed transfer of an interest in a Temporary Offshore Global Securities:
(i) The Registrar shall register the transfer of any
Security (x) if the proposed transferee is a Non-U.S. Person and the
proposed transferor has delivered to the Registrar a certificate
substantially in the form of Exhibit D hereto or (y) if the proposed
transferee is a QIB and the proposed transferor has checked the box
provided for on the form of Security stating, or has otherwise advised
the Issuer and the Registrar in writing, that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has
signed the certification provided for on the form of Security stating,
or has otherwise advised the Issuer and the Registrar in writing, that
it is purchasing the 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 QIB within the meaning of Rule 144A, 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 Issuer
as it 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 its foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
(ii) If the proposed transferee is an Agent Member, upon
receipt by the Registrar of the documents referred to in clause (i)(y)
above and instructions given in accordance with the Depository's and
the Registrar's procedures, the Registrar shall reflect on its books
and records the date and an increase in the principal amount of the
U.S. Global Securities in an amount equal to the principal amount of
the Temporary Offshore Global Securities to be transferred, and the
Trustee shall decrease the amount of the Temporary Offshore Global
Securities.
(d) Transfers of Interests in the Permanent Offshore Global Securities
-------------------------------------------------------------------
or Unlegended Offshore Physical Securities. The following provisions shall apply
- ------------------------------------------
with respect to any transfer of interests in Permanent Offshore Global
Securities or unlegended Offshore Physical Securities. The Registrar shall
register the transfer of any such Security without requiring any additional
certification.
(e) Transfers to Non-U.S. Persons at Any Time. The following
-----------------------------------------
provisions shall apply with respect to any transfer of a Security to a Non-U.S.
Person:
-52-
(i) Prior to the 41st day after the Issue Date, the
Registrar shall register any proposed transfer of a Security to a
Non-U.S. Person upon receipt of a certificate substantially in the form
of Exhibit D hereto from the proposed transferor.
(ii) On and after the 41st day after the Issue Date, the
Registrar shall register any proposed transfer to any Non-U.S. Person
if the Security to be transferred is a U.S. Physical Security or an
interest in U.S. Global Securities, upon receipt of a certificate
substantially in the form of Exhibit D hereto from the proposed
---------
transferor.
(iii) (a) If the proposed transferor is an Agent Member
holding a beneficial interest in the U.S. Global Securities, upon
receipt by the Registrar of (x) the documents, if any, required by
paragraph (ii) and (y) instructions in accordance with the Depository's
and the Registrar's procedures, the Registrar shall reflect on its
books and records the date and a decrease in the principal amount of
the U.S. Global Securities in an amount equal to the principal amount
of the beneficial interest in the U.S. Global Securities to be
transferred, and (b) if the proposed transferee is an Agent Member,
upon receipt by the Registrar of instructions given in accordance with
the Depository's and the Registrar's procedures, the Registrar shall
reflect on its books and records the date and an increase in the
principal amount of the Offshore Global Securities in an amount equal
to the principal amount of the U.S. Physical Securities or the U.S.
Global Securities, as the case may be, to be transferred, and the
Trustee shall cancel the U.S. Physical Security, if any, so transferred
or decrease the amount of the U.S. Global Security.
(f) Private Placement Legend. Upon the registration of transfer,
------------------------
exchange or replacement of Securities not bearing the Private Placement Legend,
the Registrar shall make available for delivery Securities that do not bear the
Private Placement Legend. Upon the registration of transfer, exchange or
replacement of Securities bearing the Private Placement Legend, the Registrar
shall make available for delivery only Securities that bear the Private
Placement Legend unless (i) the circumstance contemplated by paragraph
(a)(i)(x), (d) or (e)(ii) of this Section 2.16 exists or (ii) there is delivered
to the Registrar an Opinion of Counsel reasonably satisfactory to the Issuer and
the Trustee to the effect that neither such legend nor the related restrictions
on transfer are required in order to maintain compliance with the provisions of
the Securities Act.
(g) General. By its acceptance of any Security bearing the Private
-------
Placement Legend, each Holder of such Security acknowledges the restrictions on
transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or this Section 2.16 in
accordance with its customary procedures. The Issuer shall have the right to
inspect and make copies of all such letters, no-
-53-
tices or other written communications at any reasonable time upon the giving of
reasonable written notice to the Registrar.
(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 Depository or any other Person with respect
to the accuracy of the records of the Depository or its nominee or of any
participant 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 Depository) 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
Depository 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
Depository subject to the applicable rules and procedures of the Depository. The
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depository 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 Depository
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.
ARTICLE III
REDEMPTION
3.1. Notices To Trustee.
------------------
If the Issuer elects to redeem Securities pursuant to Paragraph 6 of
the Securities, they shall notify the Trustee in writing of the Redemption Date,
the Redemption Price and the principal amount of the applicable Securities to be
redeemed. The Issuer shall give notice of redemption to the Paying Agent and
Trustee at least 45 days but not more than 60 days before the Redemption Date
(unless a shorter notice shall be agreed to by the Trustee in writing), together
with an Officers' Certificate stating that such redemption will comply with the
conditions contained herein.
-54-
3.2. Selection of Securities To Be Redeemed.
--------------------------------------
In the event that less than all of the Securities are to be redeemed at
any time, selection of such Securities for redemption will be made by the
Trustee in compliance with the requirements of the principal national securities
exchange, if any, on which such Securities are listed or, if such Securities are
not then listed on a national securities exchange, on a pro rata basis, by lot
--- ----
or by such method as the Trustee shall deem fair and appropriate; provided,
--------
however, that no Securities of a principal amount of $1,000 or less shall be
- -------
redeemed in part; and provided, further, that if a partial redemption is made
-------- -------
with the Net Cash Proceeds of an Asset Sale or Equity Offering, selection of the
Securities or portions thereof for redemption shall be made by the Trustee only
on a pro rata basis or on as nearly a pro rata basis as is practicable (subject
--- ---- --- ----
to the procedures of the Depository), unless such method is otherwise
prohibited.
3.3. Notice of Redemption.
--------------------
At least 30 days but not more than 60 days before a Redemption Date,
the Issuer shall mail a notice of redemption by first class mail, postage
prepaid, to each Holder whose Securities are to be redeemed at its registered
address. At the Issuer's request at least 45 days before a Redemption Date
(unless a shorter period shall be acceptable to the Trustee), the Trustee shall
give the notice of redemption in the Issuer's name and at the Issuer's expense.
Each notice of redemption shall identify the Securities to be redeemed and shall
state:
(a) the Redemption Date;
(b) the Redemption Price and the amount of accrued interest,
if any, to be paid;
(c) the name and address of the Paying Agent;
(d) that Securities called for redemption must be surrendered
to the Paying Agent to collect the Redemption Price plus accrued
interest, if any;
(e) that, unless the Issuer defaults in making the redemption
payment, interest on Securities called for redemption ceases to accrue
on and after the Redemption Date, and the only remaining right of the
Holders of such Securities is to receive payment of the Redemption
Price and accrued interest, if any, upon surrender to the Paying Agent
of the Securities redeemed;
(f) if any Security is being redeemed in part, the portion of
the principal amount of such Security to be redeemed and that, after
the Redemption Date, and upon surrender of such Security, a new
Security or Securities in aggregate principal amount equal to the
unredeemed portion thereof will be issued;
-55-
(g) if fewer than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Securities to be
redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption;
(h) the Paragraph of the Securities pursuant to which the
Securities are to be redeemed; and
(i) the CUSIP or ISIN number, if any, printed on the
Securities being redeemed and a statement 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.
The notice, if mailed in a manner herein provided, shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Security designated for redemption in whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
3.4. Effect of Notice of Redemption.
------------------------------
Once notice of redemption is mailed in accordance with Section 3.3,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price plus accrued interest, if any. Upon surrender to the
Trustee or Paying Agent, such Securities called for redemption shall be paid at
the Redemption Price (which shall include accrued interest thereon to the
Redemption Date), but installments of interest, the maturity of which is on or
prior to the Redemption Date, shall be payable to Holders of record at the close
of business on the relevant Record Dates.
3.5. Deposit of Redemption Price.
---------------------------
On or before 11:00 a.m. New York time on the Redemption Date, the
Issuer shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay
the Redemption Price plus accrued interest, if any, of all Securities to be
redeemed on that date.
If the Issuer complies with the preceding paragraph, then, unless the
Issuer defaults in the payment of such Redemption Price plus accrued interest,
if any, interest on the Securities to be redeemed will cease to accrue on and
after the applicable Redemption Date, whether or not such Securities are
presented for payment.
-56-
3.6. Securities Redeemed In Part.
---------------------------
Upon surrender of a Security that is to be redeemed in part only, the
Trustee shall upon written instruction from the Issuer authenticate for the
Holder a new Security or Securities in a principal amount equal to the
unredeemed portion of the Security surrendered.
ARTICLE IV
COVENANTS
4.1. Payment of Securities.
---------------------
The Issuer shall pay the principal of, premium, if any, and interest on
the Securities in the manner provided in the Securities. An installment of
principal of, premium, if any, or interest on the Securities shall be considered
paid on the date it is due if the Trustee or Paying Agent holds on that date
U.S. Legal Tender designated for and sufficient to pay the installment. If the
Issuer or any Subsidiary of the Issuer acts as Paying Agent, an installment of
principal, premium, if any, or interest shall be considered paid on the date it
is due if the entity acting as Paying Agent complies with the second sentence of
Section 2.4. Interest on the Securities will be computed on the basis of a
360-day year comprised of twelve 30-day months. As provided in Section 6.9, upon
any bankruptcy or reorganization procedure relative to the Issuer, the Trustee
shall serve as Paying Agent, if any, for the Securities.
4.2. Maintenance of Office or Agency.
-------------------------------
The Issuer shall maintain in the Borough of Manhattan, The City of New
York, the office or agency required under Section 2.3. The Issuer shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Issuer shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee set forth in Section 13.2.
The Issuer may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations. The
Issuer will give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Issuer hereby initially designates the Trustee at its address c/o
United States Trust Company of New York, 114 West 47th Street, 25th Floor, New
York, New York 10036, Attention: Corporate Trust Department/Compass Minerals, as
such office of the Issuer in accordance with Section 2.3.
-57-
4.3. Limitation On Restricted Payments.
---------------------------------
The Company shall not, and shall not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, (1) declare or pay any
dividend or make any distribution (other than dividends or distributions payable
in Qualified Capital Stock of the Company) on or in respect of shares of the
Company's Capital Stock to holders of such Capital Stock; (2) purchase, redeem
or otherwise acquire or retire for value any Capital Stock of the Company or any
warrants, rights or options to purchase or acquire shares of any class of such
Capital Stock of the Company; (3) make any principal payment on, purchase,
defease, redeem, prepay, decrease or otherwise acquire or retire for value,
prior to any scheduled final maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness of the Company that is subordinate or junior in
right of payment to the Securities or any Guarantee (other than Indebtedness
described in clause (7) of the definition of "Permitted Indebtedness"); or (4)
----------------------
make any Investment (other than Permitted Investments) (each of the foregoing
actions set forth in clauses (1), (2), (3) and (4) being referred to as a
"Restricted Payment"), if at the time of such Restricted Payment or immediately
------------------
after giving effect thereto:
(a) a Default or an Event of Default shall have occurred and
be continuing; or
(b) the Company is not able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in
compliance with Section 4.4; or
(c) the aggregate amount of Restricted Payments (including
such proposed Restricted Payment) made subsequent to the Issue Date
(the amount expended for such purposes, if other than in cash, being
the fair market value of such property as determined reasonably and in
good faith by the Board of Directors of the Company whose determination
shall be conclusive) shall exceed the sum of:
(i) 50% of the cumulative Consolidated Net Income
(or if cumulative Consolidated Net Income shall be a loss,
minus 100% of such loss) of the Company earned subsequent to
the Issue Date and on or prior to the date the Restricted
Payment occurs (the "Reference Date") (treating such period as
--------------
a single accounting period); plus
(ii) 100% of the aggregate Net Cash Proceeds and
the fair market value, as determined in good faith by the
Board of Directors of the Company, of property other than cash
received by the Company from any Person (other than a
Subsidiary of the Company) from the issuance and sale
subsequent to the Issue Date and on or prior to the Reference
Date of Qualified Capital Stock of the Company (other than
Excluded Contributions); plus
(iii) without duplication of any amounts included in
clause (c)(ii) above, 100% of the aggregate Net Cash Proceeds
of any equity contribu-
-58-
tion received by the Company from a holder of the Company's Capital
Stock (other than Excluded Contributions); plus
(iv) the amount by which Indebtedness of the Company or any of
its Restricted Subsidiaries is reduced on the Company's balance sheet
upon the conversion or exchange subsequent to the Issue Date of any
Indebtedness of the Company or any of its Restricted Subsidiaries
incurred after the Issue Date into or for Qualified Capital Stock;
plus
(v) without duplication, the sum of:
(a) the aggregate amount returned in cash on or with
respect to Investments (other than Permitted Investments) made
subsequent to the Issue Date whether through interest payments,
principal payments, dividends or other distributions or payments;
(b) the net cash proceeds received by the Company or any
Restricted Subsidiary of the Company from the disposition of all
or any portion of such Investments (other than to a Subsidiary of
the Company); and
(c) upon redesignation of an Unrestricted Subsidiary as a
Restricted Subsidiary, the fair market value of such Subsidiary
(valued in each case as provided in the definition of
"Investment");
----------
provided, however, that the sum of clauses (a), (b) and (c) above shall not
- -------- -------
exceed the aggregate amount of all such Investments made by the Company or any
Restricted Subsidiary in the relevant Person or Unrestricted Subsidiary
subsequent to the Issue Date.
Notwithstanding the foregoing, the provisions set forth in the immediately
preceding paragraph do not prohibit:
(1) the payment of any dividend or other distribution within 60 days
after the date of declaration of such dividend or other distribution if the
dividend or other distribution would have been permitted on the date of
declaration;
(2) if no Default or Event of Default shall have occurred and be
continuing, the acquisition of any shares of Capital Stock of the Company,
either (a) solely in exchange for shares of Qualified Capital Stock of the
Company or Qualified Capital Stock of Holdings, or (b) through the
application of net proceeds of a substantially concurrent sale for cash
(other than to a Subsidiary of the Company) of shares of Qualified Capital
Stock of the Company or, to the extent the proceeds therefrom are
-59-
contributed by Holdings to the Company, from the shares of Capital Stock of
Holdings;
(3) if no Default or Event of Default shall have occurred and be
continuing, the acquisition of any Indebtedness of the Company that is
subordinate or junior in right of payment to the Securities or a Guarantee
either (a) solely in exchange for shares of Qualified Capital Stock of the
Company or Holdings, or (b) through the application of net proceeds of a
substantially concurrent sale for cash (other than to a Subsidiary of the
Company) of (i) shares of Qualified Capital Stock of the Company or
Holdings, or (ii) Refinancing Indebtedness;
(4) if no Default or Event of Default shall have occurred and be
continuing, repurchases by the Company or any Restricted Subsidiary of the
Company of, or dividends, distributions or advances to Holdings to allow
Holdings to repurchase (and/or to make payments on notes theretofore issued
by Holdings representing the consideration for the previous repurchase of),
securities of Holdings or the Company from employees, directors or
consultants of Holdings, the Company or any Subsidiaries of the Company or
their authorized representatives (a) upon the death, disability or
termination of employment of such employees, directors or consultants or to
the extent required pursuant to employee benefit plans, employment
agreements or consulting agreements or (b) pursuant to any other agreements
with such employees or directors of or consultants to Holdings, the Company
or any Subsidiaries of the Company, in an aggregate amount not to exceed
$7.5 million in any calendar year (with unused amounts in any calendar year
being carried over to succeeding years subject to a maximum of $15.0
million in any calendar year), provided that the cancellation of
--------
Indebtedness owing to the Company or any Restricted Subsidiary of the
Company from such employees, directors or consultants of the Company or any
of its Restricted Subsidiaries in connection with a repurchase of Capital
Stock of the Company will not be deemed to constitute a Restricted Payment
under this Indenture;
(5) the declaration and payment of dividends to holders of any class
or series of Preferred Stock of the Company, provided that for the most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date of issuance of such
Preferred Stock, after giving effect to such issuance on a pro forma basis,
--- -----
the Company would have been able to incur at least $1.00 of Indebtedness
(other than Permitted Indebtedness) pursuant to Section 4.4;
(6) the payment of dividends on the Company's Common Stock (or
dividends, distributions or advances to Holdings to allow Holdings to pay
dividends on Holdings' Common Stock), following the first public offering
of the Company's Common Stock (or of Holdings' Common Stock) after the
Issue Date, of (i) in the
-60-
case of the first public offering of the Company's Common Stock, up to 6%
per annum of the net proceeds received by the Company in such public
offering, or (ii) in the case of the first public offering of Holdings'
Common Stock, up to 6% per annum of the amount contributed by Holdings from
the proceeds received by Holdings from such offering, other than, in each
case, public offerings with respect to the Company's Common Stock (or
Holdings' Common Stock) registered on Form S-8 (or any successor form);
(7) the payment of dividends, distributions or advances to Holdings
to allow Holdings to repurchase, retire or otherwise acquire or retire for
value any Securities of Holdings, in existence on the Issue Date and from
the Persons holding such Securities on the Issue Date and which are not
held by Apollo or any of its Affiliates or members of management of the
Company and its Subsidiaries on the Issue Date (including any equity
interests issued in respect of any such securities constituting equity
interests as a result of a stock split, recapitalization, merger,
combination, consolidation or similar transaction), provided, however, that
-------- -------
the Company shall be permitted to make Restricted Payments under this
clause only if after giving effect thereto, the Company would be permitted
to incur at least $1.00 of additional Indebtedness (other than Permitted
Indebtedness) pursuant to Section 4.4;
(8) other Restricted Payments in an aggregate amount not to exceed
$15.0 million;
(9) if no Default or Event of Default shall have occurred and be
continuing, payments or distributions to, or dividends, distributions or
advances to Holdings to allow Holdings to make payments or distributions
to, dissenting stockholders pursuant to applicable law, pursuant to or in
connection with a consolidation, merger or transfer of assets that complies
with the provisions of this Indenture applicable to mergers, consolidations
and transfers of all or substantially all of the property and assets of the
Company;
(10) Investments that are made with Excluded Contributions;
(11) any payments made to consummate the Transactions pursuant to or
contemplated by the Merger Agreement and any other agreements related to
the Recapitalization in effect on the closing date of the Recapitalization,
including payments made by the Company to Holdings to allow Holdings to
satisfy its obligations under such agreements or documents, in each case,
as such agreements or documents are in effect on the Issue Date as amended
from time to time so long as such amendment is in the good faith judgment
of the Board of Directors of the Company not more disadvantageous to the
Holders of the Securities in any material respect than such agreement or
document as in effect on the Issue Date;
-61-
(12) repurchases of Capital Stock deemed to occur upon the exercise of
stock options, warrants or other convertible securities, to the extent such
Capital Stock represents a portion of the consideration for such exercise;
(13) payment of dividends, other distributions or other amounts by the
Company to Holdings in amounts required for Holdings to pay franchise taxes
and other fees required to maintain its existence and provide for all other
operating costs of Holdings, including, without limitation, in respect of
director fees and expenses, administrative, legal and accounting services
provided by third parties and other costs and expenses, including all costs
and expenses with respect to filings with the Commission, of up to $2.5
million per fiscal year;
(14) the acquisition of any shares of Disqualified Capital Stock of
the Company either (a) solely in exchange for shares of Disqualified
Capital Stock of the Company or Capital Stock of Holdings or (b) through
the application of the net proceeds of a substantially concurrent sale for
cash (other than to a Subsidiary of the Company) of shares of Disqualified
Capital Stock of the Company or, to the extent the proceeds therefrom are
contributed by Holdings to the Company, from shares of Capital Stock of
Holdings;
(15) any purchase or redemption of Indebtedness that ranks junior to
the Securities utilizing any Net Cash Proceeds remaining after the Company
has complied with the requirements of the covenants described under
Sections 4.17 and 4.18;
(16) the payment of dividends, other distributions or amounts by the
Company to Holdings in amounts required to pay the tax obligations of the
Company and its Subsidiaries and the tax obligations of Holdings or any of
its direct or indirect parent attributable to the Company and its
Subsidiaries; provided that (x) the amount of dividends paid pursuant to
--------
this clause (16) to enable Holdings or any of its direct or indirect
parents to pay Federal and state income taxes at any time shall not exceed
the amount of such Federal and state income taxes actually owing by
Holdings or any of its direct or indirect parents at such time for the
respective period and (y) any refunds received by Holdings or any of its
direct or indirect parents attributable to the Company and its Subsidiaries
shall promptly be returned by Holdings or any of its direct or indirect
parents to the Company; and
(17) if no Default or Event of Default shall have occurred and be
continuing, payments of cash, or dividends, distributions or advances to
Holdings to allow Holdings to make payments of cash, in lieu of the
issuance of fractional shares upon the exercise of warrants or upon the
conversion or exchange of, or issuance of Capital Stock in lieu of cash
dividends on, any Capital Stock of Holdings, the Company or any Restricted
Subsidiary, which in the aggregate do not exceed $3.0 million.
-62-
In determining the aggregate amount of Restricted Payments made subsequent to
the Issue Date in accordance with clause (c) of the immediately preceding
paragraph, amounts expended pursuant to clauses (1), (2), (4), (5), (6), (7),
(8), (9), (15) and (17) shall be included in such calculation.
Not later than the date of making any Restricted Payment, the Company shall
deliver to the Trustee an Officers' Certificate stating that such Restricted
Payment complies with this Indenture and setting forth in reasonable detail the
basis upon which the required calculations were computed, which calculations may
be based upon the Company's latest available internal quarterly financial
statements.
4.4. Limitation on Incurrence of Additional Indebtedness.
---------------------------------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume, guarantee,
acquire, become liable, contingently or otherwise, with respect to, or otherwise
become responsible for payment of (collectively, "incur") any Indebtedness
-----
(other than Permitted Indebtedness); provided, however, that if no Default or
-------- -------
Event of Default shall have occurred and be continuing at the time of or as a
consequence of the incurrence of any such Indebtedness, the Company and its
Restricted Subsidiaries may incur Indebtedness (including, without limitation,
Acquired Indebtedness) if on the date of the incurrence of such Indebtedness,
after giving effect to the incurrence thereof, the Consolidated Fixed Charge
Coverage Ratio of the Company is greater than 2.0 to 1.0 provided that the
--------
amount of Indebtedness (other than Acquired Indebtedness) that may be incurred
pursuant to the foregoing by Restricted Subsidiaries of the Company that have
not Guaranteed the Securities in compliance with Section 4.15 or 4.20 shall not
exceed $50.0 million at any one time outstanding.
4.5. Corporate Existence.
-------------------
Except as otherwise permitted by Article Five, the Company shall do or
cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and the corporate, partnership or other existence
of each of its Restricted Subsidiaries in accordance with the respective
organizational documents of each such Restricted Subsidiary and the rights
(charter and statutory) and material franchises of the Company and each of its
Restricted Subsidiaries; provided, however, that neither the Company nor any
-------- -------
Restricted Subsidiary shall be required to preserve any such right or franchise
or in the case of any Restricted Subsidiary, its existence, if (in each case)
the Board of Directors of the Company shall determine that the loss thereof is
not, and will not be, adverse in any material respect to the Holders.
-63-
4.6. Payment of Taxes and Other Claims.
---------------------------------
The Company shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (a) all material taxes, assessments and
governmental charges levied or imposed upon it or any of its Subsidiaries or
upon the income, profits or property of it or any of its Restricted Subsidiaries
and (b) all lawful claims for labor, materials and supplies which, in each case,
if unpaid, might by law become a material liability or Lien upon the property of
it or any of its Restricted Subsidiaries; provided, however, that the Company
-------- -------
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim whose amount, (i) the applicability or
validity is being contested in good faith by appropriate proceedings and for
which appropriate provision has been made or (ii) where the failure to effect
such payment or discharge is not adverse in any material respect to the Holders.
4.7. Maintenance of Properties and Insurance.
---------------------------------------
(a) The Company shall cause all material properties owned by or leased by
it or any of its Restricted Subsidiaries used or useful to the conduct of its
business or the business of any of its Restricted Subsidiaries, taken as a
whole, to be maintained and kept in normal condition, repair and working order
and supplied with all necessary equipment and shall cause to be made all
repairs, renewals, replacements, and betterments thereof, all as in its judgment
may be necessary, so that the business carried on in connection therewith may be
properly and advantageously conducted at all times; provided, however, that
-------- -------
nothing in this Section 4.7 shall prevent the Company or any of its Restricted
Subsidiaries from discontinuing the use, operation or maintenance of any of such
properties, or disposing of any of them, if such discontinuance or disposal is,
in the judgment of the Board of Directors of the Company or any such Restricted
Subsidiary desirable in the conduct of the business of the Company or any such
Restricted Subsidiary, and if such discontinuance or disposal is not adverse in
any material respect to the Holders; provided further that nothing in this
-------- -------
Section 4.7 shall prevent the Company or any of its Restricted Subsidiaries from
discontinuing or disposing of any properties to the extent otherwise permitted
by this Indenture.
(b) The Company shall maintain, and shall cause its Restricted
Subsidiaries to maintain, insurance with responsible carriers against such risks
and in such amounts, and with such deductibles, retentions, self-insured amounts
and co-insurance provisions, as are, in the Company's reasonable judgment,
customarily carried by similar businesses of similar size, including property
and casualty loss, workers' compensation and interruption of business insurance.
4.8. Compliance Certificate; Notice of Default.
-----------------------------------------
(a) The Issuer and each Guarantor, if any, shall deliver to the Trustee,
within 120 days after the close of each fiscal year of the Issuer, an Officers'
Certificate stating that a review of the activities of each of the Issuer has
been made under the supervision of the signing Officers
-64-
with a view to determining whether it has kept, observed, performed and
fulfilled its obligations under this Indenture and further stating, as to each
such Officer signing such certificate, that to the best of his or her knowledge,
the Issuer or the applicable Guarantor during such preceding fiscal year have
kept, observed, performed and fulfilled each and every such covenant and no
Default or Event of Default occurred during such year and at the date of such
certificate there is no Default or Event of Default that has occurred and is
continuing or, if such signers do know of such Default or Event of Default, the
certificate shall describe its status with particularity. The applicable
Officers' Certificate shall also notify the Trustee should either of the Issuer
or any Guarantor elect to change the manner in which it fixes its fiscal year
end.
(b) The annual financial statements delivered pursuant to Section 4.10
shall be accompanied by a written report of the Company's independent
accountants (who shall be a firm of established national reputation) that in
conducting their audit of such financial statements nothing has come to their
attention that would lead them to believe that the Issuer has violated any
provisions of Article Four, Five or Six of this Indenture insofar as they relate
to accounting matters or, if any such violation has occurred, specifying the
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.
(c) The Issuer shall deliver to the Trustee, in the event that any Officer
becomes aware of any Default or Event of Default in the performance of any
covenant, agreement or condition contained in this Indenture, an Officers'
Certificate specifying the Default or Event of Default and describing its status
with particularity.
4.9. Compliance With Laws.
--------------------
The Company shall comply, and shall cause each of its Subsidiaries to
comply, with all applicable statutes, rules, regulations, orders and
restrictions of the United States, all states and municipalities thereof, and of
any governmental department, commission, board, regulatory authority, bureau,
agency and instrumentality of the foregoing, in respect of the conduct of their
respective businesses and the ownership of their respective properties, except
for such noncompliances as would not in the aggregate have a material adverse
effect on the financial condition or results of operations of the Company and
its Subsidiaries taken as a whole.
4.10. Reports To Holders.
------------------
Whether or not required by the rules and regulations of the Commission, so
long as any Securities are outstanding, the Company shall file a copy of the
following information and reports with the Commission for public availability
(unless the Commission will not accept such a filing) and shall furnish to the
Holders of Securities and to securities analysts and prospective investors, upon
their written request:
-65-
(i) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q and
10-K if the Company were required to file such Forms, including a
"Management's Discussion and Analysis of Financial Condition and Results of
--------------------------------------------------------------------------
Operations" that describes the financial condition and results of
----------
operations of the Company and its consolidated Subsidiaries and, with
respect to the annual information only, a report thereon by the Company's
certified independent accountants; and
(ii) all current reports that would be required to be filed with the
Commission on Form 8-K if the Company were required to file such reports,
in each case within the time periods specified in the Commission's rules
and regulations.
In addition, following the consummation of the Exchange Offer, whether or
not required by the rules and regulations of the Commission, the Company shall
file a copy of all such information and reports with the Commission for public
availability within the time periods specified in the Commission's rules and
regulations (unless the Commission will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
written request to the Company.
In addition, for so long as any Securities remain outstanding, the Company
shall furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act.
4.11. Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Issuer and each Guarantor, covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law that would prohibit or forgive such
Issuer or such Guarantor from paying all or any portion of the principal of,
premium, if any, and/or interest on the Securities or the Guarantee of any such
Guarantor as contemplated herein, wherever enacted, now or at any time hereafter
in force, or which may affect the covenants or the performance of this
Indenture, and (to the extent that it may lawfully do so) each hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
4.12. Limitations on Transactions With Affiliates.
-------------------------------------------
(a) The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, enter into or permit to exist any
transaction or series of related transactions (including, without limitation,
the purchase, sale, lease or exchange of any property or the rendering of any
service) with, or for the benefit of, any of its Affiliates (each an "Affiliate
---------
-66-
Transaction"), other than (x) Affiliate Transactions permitted under paragraph
- -----------
(b) below and (y) Affiliate Transactions on terms that are no less favorable
than those that could reasonably have been obtained in a comparable transaction
at such time on an arm's-length basis from a Person that is not an Affiliate of
the Company or such Restricted Subsidiary. All Affiliate Transactions (and each
series of related Affiliate Transactions which are similar or part of a common
plan) involving aggregate payments or other property with a fair market value in
excess of $2.0 million shall be approved by the Board of Directors of the
Company or such Restricted Subsidiary, as the case may be, such approval to be
evidenced by a Board Resolution stating that such Board of Directors has
determined that such transaction complies with the foregoing provisions. If the
Company or any Restricted Subsidiary of the Company enters into an Affiliate
Transaction (or a series of related Affiliate Transactions related to a common
plan) that involves an aggregate fair market value of more than $10.0 million,
the Company or such Restricted Subsidiary, as the case may be, shall, prior to
the consummation thereof, obtain a favorable opinion as to the fairness of such
transaction or series of related transactions to the Company or the relevant
Restricted Subsidiary, as the case may be, from a financial point of view, from
an Independent Financial Advisor and file the same with the Trustee.
(b) The restrictions set forth in clause (a) shall not apply to:
(i) reasonable fees and compensation paid to and indemnity
provided on behalf of, officers, directors, employees or consultants
of the Company or any Restricted Subsidiary of the Company as
determined in good faith by the Company's Board of Directors;
(ii) transactions exclusively between or among the Company and
any of its Restricted Subsidiaries or exclusively between or among
such Restricted Subsidiaries, provided such transactions are not
--------
otherwise prohibited by this Indenture;
(iii) any agreement as in effect or entered into as of the Issue
Date or any amendment thereto or any transaction contemplated thereby
(including pursuant to any amendment thereto) in any replacement
agreement thereto so long as any such amendment or replacement
agreement is not more disadvantageous to the Holders in any material
respect than the original agreement as in effect on the Issue Date;
(iv) Restricted Payments and Permitted Investments permitted by
this Indenture;
(v) transactions in which the Company or any of its Restricted
Subsidiaries, as the case may be, delivers to the Trustee a letter
from an Independent Financial Advisor stating that such transaction
is fair to the Company or
-67-
such Restricted Subsidiary from a financial point of view or meets
the requirements of the first sentence of paragraph (a) above;
(vi) the 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
or similar employee benefit plans approved by Board of Directors of
the Company in good faith and loans to employees of the Company and
its Subsidiaries which are approved by the Board of Directors of the
Company in good faith;
(vii) the payment of all fees and expenses related to the
Transactions;
(viii) transactions with customers, clients, suppliers, or
purchasers or sellers of goods or services, in each case on ordinary
business terms and otherwise in compliance with the terms of this
Indenture, which are fair to the Company or its Restricted
Subsidiaries, in the reasonable determination of the Board of
Directors of the Company or the senior management thereof, or are on
terms at least as favorable as could reasonably have been obtained at
such time from an unaffiliated party;
(ix) fees payable to Apollo pursuant to the Management
Agreement as in effect on the Issue Date or pursuant to any
amendment, restatement or replacement thereof to the extent that such
amendment, restatement or replacement does not provide for any fees
or other payments in excess of those set forth in the Management
Agreement as in effect on the Issue Date;
(x) any contribution to the capital of the Company by
Holdings, or any sales of Capital Stock of the Company to Holdings;
and
(xi) any tax sharing agreement or arrangement and payments
pursuant thereto among the Company and its Subsidiaries and any other
Person with which the Company or its Subsidiaries is required or
permitted to file a consolidated tax return or with which the Company
or any of its Restricted Subsidiaries is or could be part of a
consolidated group for tax purposes in amounts not otherwise
prohibited by this Indenture.
4.13. Limitation on Dividend and Other Payment Restrictions Affecting
Subsidiaries.
---------------------------------------------------------------
The Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries (other than a Restricted Subsidiary that has executed Guarantee)
to, directly or indirectly, create or otherwise cause or permit to exist or
become effective any encumbrance or restriction on the ability of any Restricted
Subsidiary of the Company to (a) pay dividends or make any
-68-
other distribution on or in respect of its Capital Stock (it being understood
that the priority of any Preferred Stock in receiving dividends or liquidating
distributions prior to dividends or liquidating distributions being paid on
Common Stock shall not be deemed a restriction on the ability to make
distributions on Capital Stock); (b) make loans or advances or to pay any
Indebtedness or other obligation owed to the Company or any other Restricted
Subsidiary of the Company; or (c) transfer any of its property or assets to the
Company or any other Restricted Subsidiary of the Company, except for such
encumbrances or restrictions existing under or by reason of:
(i) applicable law, rule, regulation, order, grant or governmental
permit;
(ii) this Indenture;
(iii) the Credit Agreement;
(iv) customary non-assignment provisions of any contract, license or
any lease of any Restricted Subsidiary of the Company;
(v) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person, or the
properties or assets of any Person, other than the Person or the properties
or assets of the Person so acquired;
(vi) agreements existing or entered into on the Issue Date to the
extent and in the manner such agreements are in effect on the Issue Date;
(vii) purchase money obligations for property acquired in the
ordinary course of business or Capitalized Lease Obligations that impose
restrictions of the nature discussed in clause (c) above on the property so
acquired;
(viii) contracts for the sale of assets, including, without
limitation, customary restrictions with respect to a Restricted Subsidiary
of the Company pursuant to an agreement that has been entered into for the
sale or disposition of all or substantially all of the Capital Stock or
assets of such Restricted Subsidiary;
(ix) secured Indebtedness otherwise permitted to be incurred
pursuant to Sections 4.4 and 4.16 that limit the right of the debtor to
dispose of the assets securing such Indebtedness;
(x) customary provisions in joint venture agreements and other
similar agreements entered into in the ordinary course of business;
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(xi) customary net worth and restrictions on transfer, assignment or
subletting provisions contained in leases and other agreements entered into
by the Company or any Restricted Subsidiary;
(xii) any restriction in any agreement or instrument of a Receivables
Subsidiary governing a Qualified Receivables Transaction;
(xiii) any agreement governing Indebtedness incurred to Refinance the
Indebtedness issued, assumed or incurred pursuant to an agreement referred
to in clauses (i) through (xii) above; provided, however, that the
-------- -------
provisions relating to such encumbrance or restriction contained in any
such Indebtedness, taken as a whole, are no less favorable to the Company
in any material respect as determined by the Board of Directors of the
Company in their reasonable and good faith judgment than the provisions
relating to such encumbrance or restriction contained in agreements
referred to in such clauses; or
(xiv) any agreement governing Indebtedness permitted to be incurred
pursuant to Section 4.4; provided that the provisions relating to such
--------
encumbrance or restriction contained in such Indebtedness, taken as a
whole, are no less favorable to the Company in any material respect as
determined by the Board of Directors of the Company in their reasonable and
good faith judgment than the provisions contained in the Credit Agreement
or in this Indenture as in effect on the Issue Date.
4.14. Limitation on the Issuance and Sale of Capital Stock of Restricted
Subsidiaries.
------------------------------------------------------------------
The Company shall not sell, and shall not permit any Restricted Subsidiary
of the Company, directly or indirectly, to issue or sell, any shares of Capital
Stock of a Restricted Subsidiary (including options, warrants or other rights to
purchase shares of such Capital Stock) except:
(a) to the Company or a Wholly Owned Restricted Subsidiary of the
Company;
(b) issuance of director's qualifying shares or sales to foreign
nationals of shares of Capital Stock of Foreign Restricted Subsidiaries of
the Company, to the extent required by applicable law;
(c) if, immediately after giving effect to such issuance or sale,
such Restricted Subsidiary would no longer constitute a Restricted
Subsidiary of the Company and any Investment in such Person remaining after
giving effect to such issuance or sale would have been permitted to be made
under Section 4.3 if made on the date of such issuance or sale; or
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(d) the sale or issuance of Common Stock that is Qualified Capital
Stock of Restricted Subsidiaries of the Company, if the proceeds from such
issuance and sale are applied in accordance with Section 4.18.
4.15. Limitation on Issuances of Guarantees By Restricted Subsidiaries.
----------------------------------------------------------------
The Company shall not permit any Restricted Subsidiary of the Company,
directly or indirectly, to Guarantee any Indebtedness of the Company under the
Credit Agreement ("Guaranteed Indebtedness"), unless (i) such Restricted
-----------------------
Subsidiary simultaneously executes and delivers a supplemental indenture to this
Indenture providing for an unsecured senior subordinated Guarantee of payment of
the Securities by such Restricted Subsidiary, which Guarantee shall be
subordinated to the guarantee of the Indebtedness under the Credit Agreement to
the same extent that the Securities are subordinated to the Credit Agreement and
(ii) such Restricted Subsidiary waives and will not in any manner whatsoever
claim or take the benefit or advantage of any rights of reimbursement, indemnity
or subrogation or any other rights against the Company or any other Restricted
Subsidiary as a result of any payment by such Restricted Subsidiary under its
Guarantee so long as any Securities remain outstanding.
Notwithstanding the foregoing, or Section 4.20, any Guarantee by a
Restricted Subsidiary may provide by its terms that it shall be automatically
and unconditionally released and discharged upon (i) any sale, exchange or
transfer, to any Person not an Affiliate of the Company, of all of the Company's
and each Restricted Subsidiary's Capital Stock in, or all or substantially all
the assets of, such Restricted Subsidiary (which sale, exchange or transfer is
not prohibited by this Indenture), (ii) the release or discharge of the
guarantee, if any, which resulted in the creation of such Guarantee, except a
discharge or release by or as a result of payment under such guarantee or (iii)
the designation of such Restricted Subsidiary as an Unrestricted Subsidiary in
accordance with the provisions of this Indenture.
4.16. Limitation on Liens.
-------------------
The Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or permit or
suffer to exist any Liens of any kind against or upon any property or assets of
the Company or any of its Restricted Subsidiaries whether owned on the Issue
Date or acquired after the Issue Date, or any proceeds therefrom, or assign or
otherwise convey any right to receive income or profits therefrom unless:
(a) in the case of Liens securing Indebtedness that is expressly
subordinate or junior in right of payment of the Securities, the Securities are
secured by a Lien on such property, assets or proceeds that is senior in
priority to such Liens; and
(b) in all other cases, the Securities are equally and ratably secured,
except for the following Liens which are expressly permitted:
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(i) Liens existing as of the Issue Date;
(ii) Liens securing Senior Debt, Guarantor Senior Debt and
Indebtedness (including any guarantee) incurred by a Restricted Subsidiary
under the Credit Agreement;
(iii) Liens securing the Securities or any Guarantee;
(iv) Liens in favor of the Company or a Wholly Owned Restricted
Subsidiary of the Company on assets of any Restricted Subsidiary of the
Company;
(v) Liens securing Refinancing Indebtedness which is incurred to
Refinance any Indebtedness (including, without limitation, Acquired
Indebtedness) which has been secured by a Lien permitted under this
Indenture and which has been incurred in accordance with the provisions of
this Indenture; provided, however, that such Liens:
-------- -------
(a) are no less favorable to the Holders and are not more
favorable to the lienholders with respect to such Liens than the Liens
in respect of the Indebtedness being Refinanced; and
(b) do not extend to or cover any property or assets of the
Company or any of its Restricted Subsidiaries not securing the
Indebtedness so Refinanced;
(vi) Liens securing Indebtedness of Restricted Subsidiaries of the
Company so long as such Indebtedness is otherwise permitted under this
Indenture; and
(vii) Permitted Liens.
4.17. Change of Control.
-----------------
(a) Upon the occurrence of a Change of Control, the Company shall be
obligated to make an offer to purchase (the "Change of Control Offer"), and
-----------------------
shall purchase, on a Business Day (the "Change of Control Payment Date") as
------------------------------
described below, all or a portion of the then outstanding Securities at a
purchase price equal to 101% of the principal amount thereof, plus accrued and
unpaid interest, if any, thereon to the Change of Control Payment Date (subject
to the right of Holders of record on the relevant record date to receive
interest due on the relevant interest payment date). The Change of Control Offer
shall remain open for at least 20 Business Days and until the close of business
on the Change of Control Payment Date. Notwithstanding the occurrence of a
Change of Control, the Company shall not be obligated to repurchase the
Securities pursuant to this Section 4.17 in the event that the Company has
exercised its right to redeem all the Securities under the terms of Article III
of this Indenture and paragraph 6 of the Securities.
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(b) Prior to the mailing of the notice referred to below, but in any event
within 30 days following any Change of Control, the Company covenants to:
(i) repay in full and terminate all commitments under Indebtedness
under the Credit Agreement and all other Senior Debt the terms of which
require repayment upon a Change of Control or offer to repay in full and
terminate all commitments under all Indebtedness under the Credit Agreement
and all other such Senior Debt and to repay the Indebtedness owed to (and
terminate all commitments of) each lender which has accepted such offer; or
(ii) obtain the requisite consents under the Credit Agreement and all
such other Senior Debt to permit the repurchase of the Securities as
provided below.
The Company shall first comply with the covenant in the immediately preceding
sentence before it shall be required to repurchase Securities pursuant to the
provisions described below. The Company's failure to comply with the covenant
described in the second preceding sentence (and any failure to send the notice
referred to in clause (c) below because the same is prohibited by the second
preceding sentence) may (with notice and lapse of time) constitute an Event of
Default described in clause (iii) of Section 6.1 but shall not constitute an
Event of Default described in clause (ii) of Section 6.1.
(c) Within 30 days following the date upon which a Change of Control
occurs (the "Change of Control Date"), the Company shall send, by first class
----------------------
mail, a notice to each Holder, with a copy to the Trustee, which notice shall
govern the terms of the Change of Control Offer. The notice to the Holders shall
contain all instructions and materials necessary to enable such Holders to
tender Securities pursuant to the Change of Control Offer. Such notice shall
state:
(i) that the Change of Control Offer is being made pursuant to this
Section 4.17 and that all Securities tendered and not withdrawn will be
accepted for payment;
(ii) the purchase price (including the amount of accrued interest)
and the Change of Control Payment Date, which shall be a Business Day, that
is not earlier than 30 days or later than 60 days from the date such notice
is mailed, other than as may be required by law;
(iii) that any Security not tendered will continue to accrue interest;
(iv) that, unless the Company defaults in making payment therefor,
any Security accepted for payment pursuant to the Change of Control Offer
shall cease to accrue interest after the Change of Control Payment Date;
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(v) that Holders electing to have a Security purchased
pursuant to a Change of Control Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase" on
----------------------------------
the reverse of the Security completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day prior to the Change of Control Payment Date;
(vi) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than the second Business Day prior
to the Change of Control Payment Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Securities the Holder delivered for purchase and a statement
that such Holder is withdrawing his election to have such Security
purchased;
(vii) that Holders whose Securities are purchased only in part
will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered; and
(viii) the circumstances and relevant facts regarding such Change
of Control.
The Company shall not be required to make a Change of Control Offer upon a
Change of Control if any other Person makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Section 4.17 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. The provisions of this Section and other provisions
contained in this Indenture relating to the Company's obligation to make a
Change of Control Offer may be waived or modified with the written consent of
the Holders of a majority in principal amount of Securities.
On or before the Change of Control Payment Date, the Company shall (i)
accept for payment Securities or portions thereof tendered pursuant to the
Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal Tender
sufficient to pay the purchase price plus accrued interest, if any, of all
Securities so tendered and (iii) deliver to the Trustee Securities so accepted
together with an Officers' Certificate stating the Securities or portions
thereof being purchased by the Company. The Paying Agent shall promptly mail to
the Holders of Securities so accepted payment in an amount equal to the purchase
price plus accrued interest, if any, and upon written order of the Company the
Trustee shall promptly authenticate and mail to such Holders new Securities
equal in principal amount to any unpurchased portion of the Securities
surrendered. Any Securities not so accepted shall be promptly mailed by the
Company to the Holder thereof. For purposes of this Section 4.17, the Trustee
shall act as the Paying Agent.
Any amounts remaining with the Paying Agent after the purchase of
Securities pursuant to a Change of Control Offer shall be returned by the
Trustee to the Company.
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The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Securities pursuant to a Change of Control Offer. To the extent
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.17, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.17 by virtue thereof.
4.18. Limitation on Asset Sales.
-------------------------
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless:
(i) the Company or the applicable Restricted Subsidiary, as the case
may be, receives consideration at the time of such Asset Sale at least
equal to the fair market value of the assets sold or otherwise disposed of
(as determined in good faith by the Company's senior management or, in the
case of an Asset Sale in excess of $5.0 million, the Board of Directors of
the Company);
(ii) at least 75% of the consideration received by the Company or the
Restricted Subsidiary, as the case may be, from such Asset Sale shall be in
the form of (x) cash or Cash Equivalents, (y) properties and assets to be
owned by the Company or any of its Restricted Subsidiaries and used in a
Permitted Business or (z) Capital Stock in one or more Persons engaged in a
Permitted Business that are or thereby become Restricted Subsidiaries of
the Company, and, in each case, such consideration is received at the time
of such disposition; provided that the amount of (a) any liabilities (as
--------
shown on the Company's or such Restricted Subsidiary's most recent balance
sheet) of the Company or any Restricted Subsidiary (other than liabilities
that are by their terms subordinated to the Securities) that are assumed by
the transferee of any such assets, and (b) any notes or other securities
received by the Company or any such Restricted Subsidiary from such
transferee that are converted by the Company or such Restricted Subsidiary
into cash within 180 days after such Asset Sale (to the extent of the cash
received) shall be deemed to be cash for the purposes of this provision
only; and
(iii) upon the consummation of an Asset Sale, the Company shall apply,
or cause such Restricted Subsidiary to apply, the Net Cash Proceeds
relating to such Asset Sale within 360 days of receipt thereof either:
(A) to prepay any Senior Debt or Guarantor Senior Debt or any
Indebtedness of a Restricted Subsidiary that is not a Guarantor and,
in the case of any Senior Debt or Guarantor Senior Debt or
Indebtedness of a Restricted Subsidiary that is not a Guarantor under
any revolving credit facility, effect a per-
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manent reduction in the availability under such revolving credit
facility (or effect a permanent reduction in availability under such
revolving credit facility regardless of the fact that no prepayment is
required);
(B) to make an Investment (x) in properties and assets that
replace the properties and assets that were the subject of such Asset
Sale, (y) in properties and assets that will be used by the Company or
a Restricted Subsidiary in a Permitted Business or (z) permitted by
clause (1) of the definition of Permitted Investments (collectively,
"Replacement Assets"); or
------------------
(C) a combination of prepayment and investment permitted by the
foregoing clauses (iii)(A) and (iii)(B).
Pending the final application of the Net Cash Proceeds, the Company and its
Restricted Subsidiaries may temporarily reduce Indebtedness or otherwise invest
such Net Cash Proceeds in any manner not prohibited by this Indenture.
On the 361st day after an Asset Sale or such earlier date, if any, as the
senior management or the Board of Directors of the Company or of such Restricted
Subsidiary determines not to apply the Net Cash Proceeds relating to such Asset
Sale as set forth in clauses (iii)(A), (iii)(B) and (iii)(C) of the next
preceding paragraph (each, a "Net Proceeds Offer Trigger Date"), such aggregate
-------------------------------
amount of Net Cash Proceeds which have not been applied on or before such Net
Proceeds Offer Trigger Date as permitted in clauses (iii)(A), (iii)(B) and
(iii)(C) of the next preceding paragraph (each a "Net Proceeds Offer Amount")
-------------------------
shall be applied by the Company or such Restricted Subsidiary to make an offer
to purchase (the "Net Proceeds Offer") on a date (the "Net Proceeds Offer
------------------ ------------------
Payment Date") not less than 30 nor more than 60 days following the applicable
- ------------
Net Proceeds Offer Trigger Date, from all Holders on a pro rata basis, that
amount of Securities equal to the Net Proceeds Offer Amount at a price equal to
100% of the principal amount of the Securities to be purchased, plus accrued and
unpaid interest thereon, if any, to the date of purchase; provided, however,
-------- -------
that if the Company is required by the terms of any Senior Subordinated Debt,
such Net Proceeds Offer may be made ratably to purchase the Securities and such
other Senior Subordinated Debt of the Company.
If at any time any non-cash consideration received by the Company or any
Restricted Subsidiary of the Company, as the case may be, in connection with any
Asset Sale is converted into or sold or otherwise disposed of for cash (other
than interest received with respect to any such non-cash consideration), then
such conversion or disposition shall be deemed to constitute an Asset Sale
hereunder as of the date of such conversion or disposition and the Net Cash
Proceeds thereof shall be applied in accordance with this Section.
The Company may defer the Net Proceeds Offer until there is an aggregate
unutilized Net Proceeds Offer Amount equal to or in excess of $10.0 million
resulting from one or more
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Asset Sales (at which time, the entire unutilized Net Proceeds Offer Amount, and
not just the amount in excess of $10.0 million, shall be applied as required
pursuant to the second preceding paragraph).
In the event of the transfer of substantially all (but not all) of the
property and assets of the Company and its Restricted Subsidiaries as an
entirety to a Person in a transaction permitted under Section 5.1, which
transaction does not constitute a Change of Control, the successor corporation
shall be deemed to have sold the properties and assets of the Company and its
Restricted Subsidiaries not so transferred for purposes of this Section, and
shall comply with the provisions of clause (iii) of this Section with respect to
such deemed sale as if it were an Asset Sale. In addition, the fair market value
of such properties and assets of the Company or its Restricted Subsidiaries
deemed to be sold shall be deemed to be Net Cash Proceeds for purposes of this
Section 4.18.
Notice of each Net Proceeds Offer pursuant to this Section 4.18 shall be
mailed or caused to be mailed, by first class mail, by the Company within 25
days following the applicable Net Proceeds Offer Trigger Date to all Holders at
their last registered addresses, with a copy to the Trustee. A Net Proceeds
Offer shall remain open for a period of 20 Business Days or such longer period
as may be required by law. The notice shall contain all instructions and
materials necessary to enable such Holders to tender Securities pursuant to the
Net Proceeds Offer and shall state the following terms:
(i) that Holders may elect to have their Securities purchased by the
Company either in whole or in part (subject to prorationing as hereinafter
described in the event the Net Proceeds Offer is oversubscribed) in
integral multiples of $1,000 of principal amount, at the applicable
purchase price;
(ii) that the Net Proceeds Offer is being made pursuant to this
Section 4.18 and that all Securities tendered will be accepted for payment;
provided, however, that if the principal amount of Securities tendered in
-------- -------
the Net Proceeds Offer exceeds the aggregate amount of the Net Proceeds
Offer Amount, the Company shall select the Securities to be purchased on a
pro rata basis (based on amounts tendered);
--- ----
(iii) the purchase price (including the amount of accrued interest, if
any) and the purchase date (which shall be no earlier than 30 days nor
later than 60 days from the Net Proceeds Offer Trigger Date, other than as
may be required by applicable law);
(iv) that any Security not tendered will continue to accrue interest;
(v) that, unless the Company defaults in making payment therefor,
any Security accepted for payment pursuant to the Net Proceeds Offer shall
cease to accrue interest after the Net Proceeds Offer Payment Date;
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(vi) that Holders electing to have a Security purchased
pursuant to the Net Proceeds Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
----------------------------------
on the reverse of the Security completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the
Net Proceeds Offer Payment Date;
(vii) that Holders will be entitled to withdraw their election
if the Paying Agent receives, not later than the second Business Day
prior to the Net Proceeds Offer Payment Date, a facsimile transmission
or letter setting forth the name of the Holder, the principal amount of
the Security the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Security
purchased; and
(viii) that Holders whose Securities are purchased only in part
will be issued new Securities in a principal amount at maturity equal
to the unpurchased portion of the Securities surrendered.
On or before the Net Proceeds Offer Payment Date, the Company shall (i)
accept for payment Securities or portions thereof tendered pursuant to the Net
Proceeds Offer, (ii) deposit with the Paying Agent U.S. Legal Tender sufficient
to pay the purchase price, plus accrued interest, if any, of all Securities to
be purchased and (iii) deliver to the Trustee Securities so accepted together
with an Officers' Certificate stating the Securities or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail to the Holders of
Securities so accepted payment in an amount equal to the purchase price, plus
accrued interest, if any, thereon set forth in the notice of such Net Proceeds
Offer. Any Security not so accepted shall be promptly mailed by the Company to
the Holder thereof. For purposes of this Section 4.18, the Trustee shall act as
the Paying Agent.
Any amounts remaining after the purchase of Securities pursuant to a
Net Proceeds Offer shall be returned by the Trustee to the Company. To the
extent that the aggregate amount of the Securities tendered pursuant to a Net
Proceeds Offer is less than the Net Proceeds Offer Amount, the Company may use
such excess Net Proceeds Offer Amount for general corporate purposes or for any
other purposes not prohibited by this Indenture. Upon completion of any such Net
Proceeds Offer, the Net Proceeds Offer Amount shall be reset at zero.
The Company will comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Securities pursuant to a Net Proceeds Offer. To the extent that
the provisions of any securities laws or regulations conflict with the
provisions of this Section 4.18, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.18 by virtue thereof. The provisions of this
Section and other provisions contained in this Indenture relating to the
Company's obligation to make a Net Proceeds Offer may be
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waived or modified with the written consent of the Holders of a majority in
principal amount of the Securities.
4.19. Prohibition on Incurrence of Senior Subordinated Debt.
-----------------------------------------------------
The Issuer and the Guarantors, shall not incur or suffer to exist
Indebtedness that is senior in right of payment to the Securities or any
Guarantee and subordinate in right of payment by its terms to any other
Indebtedness of the Issuer or such Guarantor, as the case may be.
4.20 Future Guarantors.
-----------------
(a) If the Company organizes or acquires any Domestic Restricted
Subsidiary after the Issue Date (each a "New Domestic Restricted Subsidiary")
----------------------------------
that, after giving pro forma effect to the acquisition or organization of such
New Domestic Restricted Subsidiary or Subsidiaries (if applicable), together
with each other New Domestic Restricted Subsidiary of the Company, has
consolidated assets or Consolidated EBITDA which exceeds 5 percent of the total
consolidated assets, as of the end of the most recently completed fiscal quarter
for which financial statements are available, or total Consolidated EBITDA, for
the most recent preceding four fiscal quarters for which financial statements
are available, of the Company and its Restricted Subsidiaries, the Company
shall: (i) execute and deliver to the Trustee a supplemental indenture in form
reasonably satisfactory to the Trustee pursuant to which each such New Domestic
Restricted Subsidiary shall unconditionally guarantee all of the Company's
obligations under the Securities and this Indenture; (ii) deliver to the Trustee
an Opinion of Counsel that such supplemental indenture has been duly authorized,
executed and delivered by such New Domestic Restricted Subsidiary and
constitutes a legal, valid, binding and enforceable obligation of such New
Domestic Restricted Subsidiary; and (iii) cause each New Domestic Restricted
Subsidiary to promptly execute and deliver to the Trustee a Guarantee.
(b) Following the execution and delivery of a Guarantee by any New
Domestic Restricted Subsidiary of the Company pursuant to clause (a) of this
Section 4.20, the Company and each New Domestic Restricted Subsidiary
subsequently acquired or organized by the Company shall comply with clauses
(i)-(iii) of Section 4.20(a) above.
(c) After the execution of a supplemental indenture pursuant to clause (a)
or (b) of this Section 4.20, each such New Domestic Restricted Subsidiary party
thereto shall be a Guarantor for all purposes of this Indenture.
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ARTICLE V
SUCCESSOR CORPORATION
5.1. Merger, Consolidation and Sale of Assets.
----------------------------------------
(a) The Company shall not, in a single transaction or series of related
transactions, consolidate or merge with or into any Person, or sell, assign,
transfer, lease, convey or otherwise dispose of (or cause or permit any
Restricted Subsidiary of the Company to sell, assign, transfer, lease, convey or
otherwise dispose of) all or substantially all of the Company's assets
(determined on a consolidated basis for the Company and the Company's Restricted
Subsidiaries) whether as an entirety or substantially as an entirety to any
Person unless:
(i) either (a) the Company shall be the surviving or continuing
corporation, partnership, trust or limited liability company or (b) the
Person (if other than the Company) formed by such consolidation or into
which the Company is merged or the Person which acquires by sale,
assignment, transfer, lease, conveyance or other disposition the properties
and assets of the Company and of the Company's Restricted Subsidiaries
substantially as an entirety (the "Surviving Entity"):
----------------
(x) shall be a corporation, partnership, trust or limited
liability company organized and validly existing under the laws of the
United States or any State thereof or the District of Columbia; and
(y) shall expressly assume, by supplemental indenture (in form
and substance reasonably satisfactory to the Trustee), executed and
delivered to the Trustee, the due and punctual payment of the
principal of, and premium, if any, and interest on all of the
Securities and the performance of every covenant of the Securities and
this Indenture on the part of the Company to be performed or observed;
(ii) immediately after giving effect to such transaction on a pro
---
forma basis and the assumption contemplated by clause (a)(i)(y) above
-----
(including giving effect to any Indebtedness and Acquired Indebtedness
incurred or anticipated to be incurred in connection with or in respect of
such transaction), the Company or such Surviving Entity, as the case may
be, shall be able to incur at least $1.00 of additional Indebtedness (other
than Permitted Indebtedness) pursuant to Section 4.4;
(iii) immediately before and immediately after giving effect to such
transaction on a pro forma basis and the assumption contemplated by clause
--- -----
(a)(i)(y) above (including, without limitation, giving effect to any
Indebtedness and Acquired Indebtedness incurred or anticipated to be
incurred or repaid and any Lien granted or to be
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released in connection with or in respect of the transaction), no Default
or Event of Default shall have occurred or be continuing; and
(iv) the Company or the Surviving Entity, as the case may be, shall
have delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, sale, assignment,
transfer, lease, conveyance or other disposition and, if a supplemental
indenture is required in connection with such transaction, such
supplemental indenture comply with the applicable provisions of this
Indenture and that all conditions precedent in this Indenture relating to
such transaction have been satisfied.
Notwithstanding the foregoing, (i) the merger of the Company with an
Affiliate incorporated solely for the purpose of reincorporating the Company in
another jurisdiction shall be permitted and (ii) the merger of any Restricted
Subsidiary of the Company into the Company or the transfer, lease, conveyance or
other disposition of all or substantially all of the assets of a Restricted
Subsidiary of the Company to the Company shall be permitted so long as the
Company delivers to the Trustee an Officers' Certificate stating that the
purpose of such merger, transfer, lease, conveyance or other disposition is not
to consummate a transaction that would otherwise be prohibited by clause (iii)
of this Section 5.1(a).
(b) For purposes of the foregoing paragraph (a), the transfer (by lease,
assignment, sale or otherwise, in a single transaction or series of
transactions) of all or substantially all of the properties or assets of one or
more Restricted Subsidiaries of the Company the Capital Stock of which
constitutes all or substantially all of the properties and assets of the
Company, shall be deemed to be the transfer of all or substantially all of the
properties and assets of the Company.
(c) Each Guarantor (other than any Guarantor whose Guarantee is to be
released in accordance with the terms of such Guarantee and this Indenture in
connection with any transaction complying with the provisions of Section 4.18)
shall not, and the Company shall not cause or permit any Guarantor to,
consolidate with or merge with or into any Person other than the Company or any
other Guarantor unless:
(i) the Person formed by or surviving any such consolidation or
merger (if other than the Guarantor) or to which such sale, lease,
conveyance or other disposition shall have been made is a corporation,
partnership or limited liability company organized and validly existing
under the laws of the United States, any State thereof, the District of
Columbia thereof or the jurisdiction in which such Guarantor is organized;
(ii) such Person expressly assumes by supplemental indenture all of
the obligations of the Guarantor on its Guarantee;
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(iii) immediately after giving effect to such transaction on a pro
---
forma basis, no Default or Event of Default shall have occurred and be
-----
continuing; and
(iv) immediately after giving effect to such transaction and the use
of any net proceeds therefrom on a pro forma basis, the Company could
--- -----
satisfy the provisions of clause (ii) of Section 5.1(a).
Any merger or consolidation of a Guarantor with and into the Company (with
the Company being the surviving entity) or another Guarantor that is a Wholly
Owned Restricted Subsidiary of the Company need only comply with clause (iv) of
Section 5.1(a).
5.2. Successor Corporation Substituted.
---------------------------------
Upon any consolidation, combination or merger or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.1 in
which the Company or any Guarantor, as applicable, is not the continuing
corporation, the successor Person formed by such consolidation or into which the
Company or such Guarantor is merged or to which such conveyance, lease or
transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company or such Guarantor under this Indenture and
the Securities or any Guarantee, as applicable, with the same effect as if such
Surviving Entity had been named as such.
ARTICLE VI
DEFAULT AND REMEDIES
6.1. Events of Default.
-----------------
Each of the following shall be an "Event of Default":
----------------
(i) the failure to pay interest on any Securities when the same
becomes due and payable and the default continues for a period of 30 days
(whether or not such payment shall be prohibited by Article Ten or Article
Twelve);
(ii) the failure to pay the principal on any Securities, when such
principal becomes due and payable, at maturity, upon redemption or
otherwise (including the failure to make a payment to purchase Securities
tendered pursuant to a Change of Control Offer or a Net Proceeds Offer)
(whether or not such payment shall be prohibited by Article Ten or Article
Twelve);
(iii) a default by the Company or any Restricted Subsidiary of the
Company in the observance or performance of any other covenant or agreement
contained in this
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Indenture, which default continues for a period of 30 days after the
Company receives written notice specifying the default (and demanding that
such default be remedied) from the Trustee or from the Holders of at least
25% of the outstanding principal amount of the Securities;
(iv) the failure to pay at final stated maturity (giving effect to
any applicable grace periods and any extensions thereof) the principal
amount of any Indebtedness of the Company or the Indebtedness of any
Significant Subsidiaries of the Company, or the acceleration of the final
stated maturity of any such Indebtedness by the holders thereof if the
aggregate principal amount of such Indebtedness, together with the
principal amount of any other such Indebtedness in default for failure to
pay principal at final stated maturity or which has been accelerated,
exceeds $10.0 million or more at any time;
(v) one or more judgments in an aggregate amount in excess of $10.0
million (exclusive of amounts covered by insurance other than
self-insurance) shall have been rendered against the Company or any of its
Significant Subsidiaries and such judgments remain undischarged, unpaid or
unstayed for a period of 60 days after such judgment or judgments become
final and non-appealable;
(vi) the Company or any of its Significant Subsidiaries (i)
commences a voluntary case or proceeding under any Bankruptcy Law with
respect to itself, (ii) consents to the entry of a judgment, decree or
order for relief against it in an involuntary case or proceeding under any
Bankruptcy Law, (iii) consents to the appointment of a custodian of it or
for substantially all of its property, (iv) consents to or acquiesces in
the institution of a bankruptcy or an insolvency proceeding against it, (v)
makes a general assignment for the benefit of its creditors or (vi) takes
any corporate action to authorize or effect any of the foregoing;
(vii) a court of competent jurisdiction enters a judgment, decree or
order for relief in respect of the Company or any of its Significant
Subsidiaries in an involuntary case or proceeding under any Bankruptcy Law,
which shall (i) approve as properly filed a petition seeking
reorganization, arrangement, adjustment or composition in respect of the
Company or any of its Significant Subsidiaries, (ii) appoint a Custodian of
the Company or any of its Significant Subsidiaries or for substantially all
of any of its property or (iii) order the winding-up or liquidation of its
affairs; and such judgment, decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or
(viii) any Guarantee of a Significant Subsidiary ceases to be in full
force and effect or any Guarantee made by a Significant Subsidiary is
declared to be null and void and unenforceable or any Guarantee made by a
Significant Subsidiary is found to
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be invalid or any such Guarantor denies its liability under its Guarantee
(other than by reason of release of a Guarantor in accordance with the
terms of this Indenture).
If, pursuant to clause (iii) above, the Holders of at least 25% of the then
outstanding principal amount of Securities notify the Company as specified in
such clause, such Holders shall similarly notify the Trustee. Any notice given
pursuant to clause (iii) above or the immediately preceding sentence shall be
given by registered or certified mail, return receipt requested.
6.2. Acceleration.
------------
If an Event of Default (other than an Event of Default specified in clause
(vi) or (vii) of Section 6.1 above with respect to the Company) shall occur and
be continuing, the Trustee or the Holders of at least 25% in principal amount of
outstanding Securities may declare the principal of, premium, if any, and
accrued interest on all the Securities to be due and payable by notice in
writing to the Issuer and the Trustee specifying the respective Event of Default
and that it is a "notice of acceleration" (the "Acceleration Notice"), and the
---------------------- -------------------
same (i) shall become immediately due and payable or (ii) if there are any
amounts outstanding under the Credit Agreement, shall become immediately due and
payable upon the first to occur of an acceleration under the Credit Agreement or
five (5) Business Days after receipt by the Company and the Representative under
the Credit Agreement of such Acceleration Notice (but only if such Event of
Default is then continuing). If an Event of Default specified in clause (vi) or
(vii) of Section 6.1 above with respect to the Company occurs and is continuing,
then all unpaid principal of, and premium, if any, and accrued and unpaid
interest on all of the outstanding 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 Holder.
At any time after a declaration of acceleration with respect to the
Securities as described in the preceding paragraph, the Holders of a majority in
principal amount of the Securities may rescind and cancel such declaration and
its consequences (i) if the rescission would not conflict with any judgment or
decree, (ii) if all existing Events of Default have been cured or waived except
nonpayment of principal, premium, if any, or interest that has become due solely
because of the acceleration, (iii) to the extent the payment of such interest is
lawful, interest on overdue installments of interest and overdue principal and
premium if any, which has become due otherwise than by such declaration of
acceleration, has been paid, (iv) if the Company has paid the Trustee its
reasonable compensation and reimbursed the Trustee for its expenses,
disbursements and advances, and any other amounts due to the Trustee under
Section 7.7 and (v) in the event of the cure or waiver of an Event of Default of
the type described in clause (vi) or (vii) of Section 6.1, the Trustee shall
have received an Officers' Certificate and an Opinion of Counsel that such Event
of Default has been cured or waived. No such rescission shall affect any
subsequent Default or Event of Default or impair any right consequent thereto.
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6.3. Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy by proceeding at law or in equity to collect the payment of
principal of, premium, if any, or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
6.4. Waiver of Past Defaults.
-----------------------
Subject to Sections 2.9, 6.2, 6.7 and 9.2, the Holders of not less than a
majority in principal amount of the outstanding Securities by notice to the
Trustee may waive an existing Default or Event of Default and its consequences,
except a Default or Event of Default in the payment of principal of, premium, if
any, or interest on any Security as specified in clauses (i) and (ii) of Section
6.1. The Company shall deliver to the Trustee an Officers' Certificate stating
that the requisite percentage of Holders have consented to such waiver and
attaching copies of such consents. When a Default or Event of Default is waived,
it is cured and ceases.
6.5. Control By Majority.
-------------------
The Holders of not less than a majority in principal amount of the
outstanding Securities may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on it. Subject to Section 7.1, however, the Trustee may refuse
to follow any direction that conflicts with any law or this Indenture, that the
Trustee determines may be unduly prejudicial to the rights of another
Securityholder, or that may involve the Trustee in personal liability.
6.6. Limitation on Suits.
-------------------
A Securityholder may not pursue any remedy with respect to this Indenture
or the Securities unless:
(i) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(ii) the Holder or Holders of at least 25% in principal amount of the
outstanding Securities make a written request to the Trustee to pursue the
remedy;
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(iii) such Holder or Holders offer and, if requested, provide to the
Trustee indemnity satisfactory to the Trustee against any loss, liability
or expense;
(iv) the Trustee does not comply with the request within 45 days
after receipt of the request and the offer and, if requested, the provision
of indemnity; and
(v) during such 45-day period the Holder or Holders of a majority in
principal amount of the outstanding Securities do not give the Trustee a
direction which, in the opinion of the Trustee, is inconsistent with the
request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
6.7. Rights of Holders To Receive Payment.
------------------------------------
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of principal of, premium, if any, and interest on a
Security, on or after the respective due dates expressed in such Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of the Holder.
6.8. Collection Suit By Trustee.
--------------------------
If an Event of Default in payment of principal, premium, if any, or
interest specified in clause (i) or (ii) of Section 6.1 occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Issuer or any other obligor on the Securities for
the whole amount of principal, premium, if any, and accrued interest and fees
remaining unpaid, together with interest on overdue principal and premium, if
any, and, to the extent that payment of such interest is lawful, interest on
overdue installments of interest, in each case at the rate per annum borne by
--- -----
the Securities and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due to the Trustee under Section 7.7.
6.9. Trustee May File Proofs of Claim.
--------------------------------
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due
to the Trustee under Section 7.7) and the Securityholders allowed in any
judicial proceedings relating to the Issuer, their creditors or their property
and shall be entitled and empowered to participate as a member, voting or
otherwise, of any official committee appointed for such matter, to collect and
receive any monies or other securities
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or property payable or deliverable upon the conversion or exchange of the
Securities or upon any such claims and to distribute the same, and any Custodian
in any such judicial proceedings is hereby authorized by each Securityholder to
make such payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Securityholders, to pay
to the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agent and counsel, and any other
amounts due the Trustee under Section 7.7. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Securityholder any plan of reorganization, arrangement, adjustment
or composition affecting the Securities or the rights of any Holder thereof, or
to authorize the Trustee to vote in respect of the claim of any Securityholder
in any such proceeding.
6.10. Priorities.
----------
If the Trustee collects any money or property pursuant to this Article Six,
it shall pay out the money or property in the following order:
First: to the Trustee for amounts due under Section 7.7;
Second: subject to Article Ten, to Holders for interest accrued on the
Securities, ratably, without preference or priority of any kind, according
to the amounts due and payable on the Securities for interest;
Third: subject to Article Ten, to Holders for principal amounts and
premium, if any, due and unpaid on the Securities, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Securities for principal; and
Fourth: to the Issuer or, to the Guarantors as their respective
interests may appear.
The Trustee, upon prior notice to the Issuer, may fix a record date and
payment date for any payment to Securityholders pursuant to this Section 6.10.
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 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.7, or a suit by a Holder or Holders of more than 10% in principal amount of
the outstanding Securities.
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6.12. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to such Holder, then, and in every such case, subject to any determination in
such proceeding, the Issuer, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Issuer, Trustee and the Holders shall continue as
though no such proceeding had been instituted.
6.13. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost or wrongfully taken Securities in Section 2.7, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
ARTICLE VII
TRUSTEE
7.1. Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture and
use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties as are specifically
set forth herein or in the TIA and no duties, covenants, responsibilities
or obligations shall be implied in this Indenture against the Trustee.
(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 (including Officers'
Certificates) or opinions (including Opinions of Counsel) furnished to the
Trustee and conforming to the requirements of
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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 verify the contents thereof.
(c) Notwithstanding anything to the contrary herein, the Trustee may
not be relieved from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) This paragraph does not limit the effect of paragraph
(b) of this Section 7.1.
(ii) The Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts.
(iii) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.5.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or to take or omit to take any action
under this Indenture or take any action at the request or direction of Holders
if it shall have reasonable grounds for believing that repayment of such funds
is not assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to this Section 7.1.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Issuer. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
(g) In the absence of bad faith, negligence or willful misconduct on
the part of the Trustee, the Trustee shall not be responsible for the
application of any money by any Paying Agent other than the Trustee.
7.2. Rights of Trustee.
-----------------
Subject to Section 7.1:
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document.
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(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate and an Opinion of Counsel, which shall conform to the
provisions of Section 13.5. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent (other than an
agent who is an employee of the Trustee) appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it reasonably believes to be authorized or within its
rights or powers.
(e) The Trustee may consult with counsel and the advice or opinion of
such counsel as to matters of law shall be full and complete authorization and
protection from liability in respect of any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate (including any Officers'
Certificate), statement, instrument, opinion (including any Opinion of Counsel),
notice, request, direction, consent, order, bond, debenture, or other paper or
document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled, upon reasonable notice to the Issuer, to examine the books, records,
and premises of the Issuer, personally or by agent or attorney.
(h) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(i) The permissive rights of the Trustee to do things enumerated in
this Indenture shall not be construed as duties.
(j) The Trustee shall not be charged with knowledge of any Default or
Event of Default, of the identity of any Restricted Subsidiary or the existence
of any Change of Control or Asset Sale unless either (i) a Responsible Officer
shall have actual knowledge thereof or (ii) the Trustee shall have received
written notice thereof from either of the Issuer or any Holder.
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(k) Delivery of reports, information and documents to the Trustee under
Section 4.10 is for informational purposes only and the Trustee's receipt of the
foregoing shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Issuer's compliance with any of the covenants hereunder.
7.3. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Issuer, its
Subsidiaries (including any Guarantors) or their respective Affiliates with the
same rights it would have if it were not Trustee. Any Agent may do the same with
like rights. However, the Trustee must comply with Sections 7.10 and 7.11.
7.4. Trustee's Disclaimer.
--------------------
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture, any Guarantee or the Securities,
it shall not be accountable for the Issuer's use of the proceeds from the
Securities, and it shall not be responsible for any statement of the Issuer in
this Indenture or any document issued in connection with the sale of Securities
or any statement in the Securities other than the Trustee's certificate of
authentication. The Trustee makes no representations with respect to the
effectiveness or adequacy of this Indenture.
7.5. Notice of Default.
-----------------
If a Default or an Event of Default occurs and is continuing and the
Trustee receives actual notice of such Default or Event of Default, the Trustee
shall mail to each Securityholder notice of the uncured Default or Event of
Default within 60 days after such Default or Event of Default occurs. Except in
the case of a Default or an Event of Default in payment of principal of,
premium, if any, or interest on, any Security, including an accelerated payment
and the failure to make payment on the Change of Control Payment Date pursuant
to a Change of Control Offer or the Net Proceeds Offer Payment Date pursuant to
a Net Proceeds Offer, the Trustee may withhold the notice if and so long as the
Board of Directors, the executive committee, or a trust committee of directors
and/or Responsible Officers, of the Trustee in good faith determines that
withholding the notice is in the interest of the Securityholders.
7.6. Reports By Trustee To Holders.
-----------------------------
Within 60 days after each May 15, beginning with the first May 15
following the date of this Indenture, the Trustee shall, to the extent that any
of the events described in TIA (S) 313(a) occurred within the previous twelve
months, but not otherwise, mail to each Securityholder a brief report dated as
of such date that complies with TIA (S) 313(a). The Trustee also shall comply
with TIA (S)(S) 313(b), 313(c) and 313(d).
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A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Issuer and filed with the Commission and each securities
exchange, if any, on which the Securities are listed.
The Issuer shall notify the Trustee if the Securities become listed on
any securities exchange or of any delisting thereof and the Trustee shall comply
with TIA (S) 313(d).
7.7. Compensation and Indemnity.
--------------------------
The Issuer and the Guarantors shall pay to the Trustee, from time to
time, reasonable compensation for its services hereunder. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Issuer and the Guarantors shall reimburse the Trustee upon
request for all reasonable disbursements, expenses and advances (including
reasonable fees and expenses of counsel) incurred or made by it in addition to
the compensation for its services, except any such disbursements, expenses and
advances as may be attributable to the Trustee's negligence, bad faith or
willful misconduct. Such expenses shall include the reasonable fees and expenses
of the Trustee's agents and counsel.
The Issuer and the Guarantors shall indemnify the Trustee and its
agents, employees, officers, stockholders and directors for, and hold them
harmless against, any loss, liability or expense (including reasonable
attorneys' fees and expenses) incurred by them except for such actions to the
extent caused by any negligence, bad faith or willful misconduct on their part,
arising out of or in connection with the acceptance or administration of this
trust including the cost and expense of enforcing this Indenture and the
Securities against the Issuer and the Guarantors (including this Section 7.7)
including the reasonable costs and expenses of defending themselves against or
investigating any claim (whether asserted by the Issuer, the Guarantors, any
Holder or any other Person) or liability in connection with the exercise or
performance of any of the Trustee's rights, powers or duties hereunder. The
Trustee shall notify the Issuer and the Guarantors promptly of any claim
asserted against the Trustee or any of its agents, employees, officers,
stockholders and directors for which it may seek indemnity, provided that any
--------
failure to so notify the Issuer and the Guarantors shall not relieve the Issuer
and the Guarantors of their indemnity obligations hereunder. The Issuer and the
Guarantors may, subject to the approval of the Trustee, defend the claim and the
Trustee shall cooperate in the defense. The Trustee and its agents, employees,
officers, stockholders and directors subject to the claim may have separate
counsel and the Issuer and the Guarantors shall pay the reasonable fees and
expenses of such counsel; provided, however, that the Issuer and the Guarantors
-------- -------
will not be required to pay such fees and expenses if, subject to the approval
of the Trustee, it assumes the Trustee's defense and there is no conflict of
interest between the Issuer and the Guarantors and the Trustee and its agents,
employees, officers, stockholders and directors subject to the claim in
connection with such defense as reasonably determined by the Trustee. The Issuer
and the Guarantors need not pay for any settlement made without their written
consent, which consent will not be unreasonably withheld, delayed or
conditioned. The Issuer
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and the Guarantors need not reimburse any expense or indemnify against any loss
or liability to the extent incurred by the Trustee through its negligence, bad
faith or willful misconduct.
To secure the Issuer's and the Guarantors' payment obligations in this
Section 7.7, the Trustee shall have a Lien prior to the Securities against all
money or property held or collected by the Trustee, in its capacity as Trustee.
The obligations of the Issuer and Guarantors under this Section shall not be
subordinated to the payment of Senior Debt pursuant to Article Ten or Guarantor
Senior Debt pursuant to Article Twelve except assets or money held in trust to
pay principal of, premium, if any, or interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in clause (vi) or (vii) of Section 6.1 occurs, such expenses
and the compensation for such services shall be paid to the extent allowed under
any Bankruptcy Law.
Notwithstanding any other provision in this Indenture, the foregoing
provisions of this Section 7.7 shall survive the satisfaction and discharge of
this Indenture or the appointment of a successor Trustee.
7.8. Replacement of Trustee.
----------------------
The Trustee may resign at any time by so notifying the Issuer in
writing. The Holders of a majority in principal amount of the outstanding
Securities may remove the Trustee by so notifying the Issuer and the Trustee and
may appoint a successor Trustee. The Issuer may 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 becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuer shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Securities may appoint a successor Trustee to replace the successor Trustee
appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Immediately after that,
the retiring Trustee shall transfer, after payment of all sums then owing to the
Trustee pursuant to Section 7.7, all property held by it
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as Trustee to the successor Trustee, subject to the Lien provided in Section
7.7, the resignation or removal of the retiring Trustee shall become effective,
and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Securityholder.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 10% in principal amount of the outstanding Securities may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section 7.8,
the Issuer's and the Guarantors' obligations under Section 7.7 shall continue
for the benefit of the retiring Trustee.
7.9. Successor Trustee By Merger, Etc.
--------------------------------
If the Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the resulting, surviving or transferee corporation without any further act
shall, if such resulting, surviving or transferee corporation is otherwise
eligible hereunder, be the successor Trustee; provided that such corporation
shall be otherwise qualified and eligible under this Article Seven.
7.10. Eligibility; Disqualification.
-----------------------------
This Indenture shall always have a Trustee who satisfies the requirement of
TIA (S)(S)310(a)(1), 310(a)(2) and 310(a)(5). 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. In addition, if the Trustee is a
corporation included in a bank holding company system, the Trustee,
independently of the bank holding company, shall meet the capital requirements
of TIA (S)310(a)(2). The Trustee shall comply with TIA (S)310(b); provided,
--------
however, that there shall be excluded from the operation of TIA (S)310(b)(1)
- ------
any indenture or indentures under which other securities, or certificates of
interest or participation in other securities, of the Issuer are outstanding, if
the requirements for such exclusion set forth in TIA (S)310(b)(1) are met. The
provisions of TIA (S)310 shall apply to the Issuer and any other obligor of the
Securities.
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7.11. Preferential Collection of Claims Against the Issuer.
----------------------------------------------------
The Trustee, in its capacity as Trustee hereunder, shall comply with
TIA (S)311(a), excluding any creditor relationship listed in TIA (S)311(b). A
Trustee who has resigned or been removed shall be subject to TIA (S)311(a) to
the extent indicated.
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
8.1. Termination of the Issuer's Obligations.
---------------------------------------
The Issuer may terminate its obligations under the Securities and this
Indenture, except those obligations referred to in the penultimate paragraph of
this Section 8.1, if all Securities previously authenticated and delivered
(other than destroyed, lost or stolen Securities which have been replaced or
paid or Securities for whose payment U.S. Legal Tender has theretofore been
deposited with the Trustee or the Paying Agent in trust or segregated and held
in trust by the Issuer and thereafter repaid to the Issuer, as provided in
Section 8.5) have been delivered to the Trustee for cancellation and the Issuer
has paid all sums payable by them hereunder, or if:
(i) either (i) pursuant to Article Three, the Issuer shall have
given notice to the Trustee and mailed a notice of redemption to each
Holder of the redemption of all of the Securities in accordance with the
provisions hereof or (ii) all Securities have otherwise become due and
payable hereunder;
(ii) the Issuer shall have irrevocably deposited or caused to be
deposited with the Trustee or a trustee satisfactory to the Trustee, under
the terms of an irrevocable trust agreement in form and substance
satisfactory to the Trustee, as trust funds in trust solely for the benefit
of the Holders of that purpose, U.S. Legal Tender in such amount as is
sufficient without consideration of reinvestment of such interest, to pay
principal of, premium, if any, and interest on the outstanding Securities
to maturity or redemption; provided that the Trustee shall have been
--------
irrevocably instructed to apply such U.S. Legal Tender to the payment of
said principal, premium, if any, and interest with respect to the
Securities and provided, further, that from and after the time of deposit,
-------- -------
the money deposited shall not be subject to the rights of holders of Senior
Debt or Guarantor Senior Debt pursuant to the provisions of Article Ten or
Twelve, as the case may be;
(iii) no Default or Event of Default with respect to this Indenture or
the Securities shall have occurred and be continuing on the date of such
deposit or shall occur as a result of such deposit (other than a Default or
Event of Default resulting from
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the incurrence of Indebtedness all or a portion of the proceeds of which
will be used to defease the Securities pursuant to this Article Eight
concurrently with such incurrence) and such deposit will not result in a
breach or violation of, or constitute a default under, any other instrument
or agreement (including, without limitation, the Credit Agreement) to which
either of the Issuer is a party or by which either is bound;
(iv) the Issuer shall have paid all other sums payable by it
hereunder; and
(v) the Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent providing for or relating to the termination of the Issuer's
obligations under the Securities and this Indenture have been complied
with. Such Opinion of Counsel shall also state that such satisfaction and
discharge does not result in a default under the Credit Agreement or any
other material agreement or instrument then known to such counsel that
binds or affects the Issuer.
Subject to the next sentence and notwithstanding the foregoing paragraph,
the Issuer's obligations in Sections 2.5, 2.6, 2.7, 2.8, 4.1, 4.2, 7.7, 8.5 and
8.6 shall survive until the Securities are no longer outstanding pursuant to the
last paragraph of Section 2.8. After the Securities are no longer outstanding,
the Issuer's obligations in Sections 7.7, 8.5 and 8.6 shall survive.
After such delivery or irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Issuer's obligations under the
Securities and this Indenture except for those surviving obligations specified
above.
8.2. Legal Defeasance and Covenant Defeasance.
----------------------------------------
(a) The Issuer may, at its option by Board Resolutions of the Boards of
Directors of the Issuer, at any time, elect to have either paragraph (b) or (c)
below applied to all outstanding Securities upon compliance with the conditions
set forth in Section 8.3.
(b) Upon the Issuer's exercise under paragraph (a) hereof of the option
applicable to this paragraph (b), the Issuer and any Guarantor shall, subject to
the satisfaction of the conditions set forth in Section 8.3, be deemed to have
been discharged from their respective obligations with respect to all
outstanding Securities and the corresponding Guarantees on the date the
conditions set forth below are satisfied (hereinafter, "Legal Defeasance"). For
----------------
his purpose, Legal Defeasance means that the Issuer shall be deemed to have
paid and discharged the entire Indebtedness represented by the outstanding
Securities, which shall thereafter be deemed to be "outstanding" only for the
-----------
rposes of Section 8.4 and the other Sections of this Indenture referred to in
(i) and (ii) below, and to have satisfied all its other obligations under such
Securities and this Indenture (and the Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments acknowledging the same), and
Holders of the Securi-
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ties and any amounts deposited under Section 8.3 shall cease to be
subject to any obligations to, or the rights of, any holder of Senior Debt under
Article Ten or otherwise, except for the following provisions, which shall
survive until otherwise terminated or discharged hereunder: (i) the rights of
Holders of outstanding Securities to receive solely from the trust fund
described in Section 8.4, and as more fully set forth in such Section, payments
in respect of the principal of, premium, if any, and interest on such Securities
when such payments are due, (ii) the Company's obligations with respect to such
Securities under Article Two and Section 4.2, (iii) the rights, powers, trusts,
duties and immunities of the Trustee hereunder and the Company's obligations in
connection therewith and (iv) this Article Eight. Subject to compliance with
this Article Eight, the Issuer may exercise its option under this paragraph (b)
notwithstanding the prior exercise of its option under paragraph (c) hereof.
(c) Upon the Issuer's exercise under paragraph (a) hereof of the option
applicable to this paragraph (c), the Issuer and each Guarantor shall, subject
to the satisfaction of the conditions set forth in Section 8.3, be released from
their obligations, if any, under the covenants contained in Sections 4.3 and 4.4
and Sections 4.12 through 4.20 and Article Five with respect to the outstanding
Securities and the corresponding Guarantees on and after the date the conditions
set forth below are satisfied (hereinafter, "Covenant Defeasance"), and the
-------------------
Securities shall thereafter be deemed not "outstanding" for the purposes of any
-----------
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
-----------
understood that such Securities shall not be deemed outstanding for accounting
purposes) and Holders of the Securities and any amounts deposited under Section
8.3 shall cease to be subject to any obligations to, or the rights of, any
holder of Senior Debt under Article Ten or otherwise. For this purpose, such
Covenant Defeasance means that, with respect to the outstanding Securities, the
Company may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such covenant, whether directly
or indirectly, by reason of any reference elsewhere herein to any such covenant
or by reason of any reference in any such covenant to any other provision herein
or in any other document and such omission to comply shall not constitute a
Default or an Event of Default under Section 6.1(iii), but, except as specified
above, the remainder of this Indenture and such Securities shall be unaffected
thereby. In addition, upon the Issuer's exercise under paragraph (a) hereof of
the option applicable to this paragraph (c), subject to the satisfaction of the
conditions set forth in Section 8.3 hereof, Sections 6.1(iii), 6.1(iv) and
6.1(v) shall not constitute Events of Default.
8.3. Conditions To Legal Defeasance or Covenant Defeasance.
-----------------------------------------------------
The following shall be the conditions to the application of either
Section 8.2(b) or 8.2(c) to the outstanding Securities:
In order to exercise either Legal Defeasance or Covenant Defeasance:
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(i) the Issuer must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, U.S. Legal Tender or non-callable U.S.
Government Obligations which through the scheduled payment of principal,
premium, if any, and interest in respect thereof in accordance with their
terms, will provide, not later than one day before the due date of any
payment on the Securities, U.S. Legal Tender, or a combination thereof, in
such amounts as will be sufficient, in the opinion of a nationally
recognized firm of independent public accountants, to pay the principal of,
premium, if any, and interest on the Securities on the stated date for
payment thereof or on the applicable redemption date, as the case may be;
(ii) in the case of an election under Section 8.2(b), the Issuer
shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that (a) the Issuer
has received from, or there has been published by, the Internal Revenue
Service a ruling or (b) since the date of the execution 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 Legal 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 Legal Defeasance
had not occurred;
(iii) in the case of an election under Section 8.2(c), the Issuer
shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that the Holders of
the Securities will not recognize income, gain or loss for federal income
tax purposes as a result of such Covenant Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not
occurred;
(iv) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of
Default resulting from the incurrence of Indebtedness all or a portion of
the proceeds of which will be used to defease the Securities pursuant to
this Article Eight concurrently with such incurrence) or insofar as
Sections 6.1(vi) and 6.1(vii) hereof are concerned, at any time in the
period ending on the 91st day after the date of such deposit;
(v) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute a default under this Indenture
(other than a Default or Event of Default resulting from the incurrence of
Indebtedness all or a portion of the proceeds of which will be used to
defease the Securities pursuant to this Article Eight concurrently with
such incurrence), the Credit Agreement or any other material
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agreement or instrument to which the Company or any of its Subsidiaries
is a party or by which the Company or any of its Subsidiaries is bound;
(vi) the Issuer shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made by the
Issuer with the intent of preferring the Holders over any other
creditors of the Issuer or with the intent of defeating, hindering,
delaying or defrauding any other creditors of the Issuer or others;
(vii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent hereunder provided for or relating to the Legal
Defeasance or the Covenant Defeasance have been complied with; and
(viii) the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that the trust funds are not subject
to any rights of holders of Senior Debt, including without limitation,
those arising under the Indenture, and assuming no intervening
bankruptcy or insolvency of the Company between the date of deposit and
the 91st day following the deposit and that no Holder is an insider of
the Company, after the 91st day following the deposit, the trust funds
will not be subject to the effect of Section 547 of the United States
Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law.
Notwithstanding the foregoing, the Opinion of Counsel required by
clause (ii) above of this Section 8.3 need not be delivered if all Securities
not theretofore delivered to the Trustee for cancellation (i) have become due
and payable, (ii) will become due and payable on the Maturity Date within one
year or (iii) are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Company.
8.4. Application of Trust Money.
--------------------------
The Trustee or Paying Agent shall hold in trust U.S. Legal Tender or
U.S. Government Obligations deposited with it pursuant to this Article Eight,
and shall apply the deposited U.S. Legal Tender and the money from U.S.
Government Obligations in accordance with this Indenture to the payment of
principal of, premium, if any, and interest on the Securities.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Legal Tender or U.S.
Government Obligations deposited pursuant to Section 8.3 hereof or the
principal, premium, if any, and interest received in respect thereof other than
any such tax, fee or other charge which by law is for the account of the Holders
of the outstanding Securities.
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Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuer from time to time upon the Issuer's
request any U.S. Legal Tender or U.S. Government Obligations held by it as
provided in Section 8.3 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
8.5. Repayment To the Issuer.
-----------------------
The Trustee and the Paying Agent shall pay to the Issuer upon request
any money held by them for the payment of principal, premium, if any, or
interest that remains unclaimed for two years; provided that the Trustee or such
--------
Paying Agent, before being required to make any payment, may at the expense of
the Issuer cause to be published once in a newspaper of general circulation in
The City of New York or mail to each Holder entitled to such money notice that
such money remains unclaimed and that after a date specified therein which shall
be at least 30 days from the date of such publication or mailing any unclaimed
balance of such money then remaining will be repaid to the Issuer. After payment
to the Issuer, Holders entitled to such money must look to the Issuer for
payment as general creditors unless an applicable law designates another Person.
8.6. Reinstatement.
-------------
If the Trustee or Paying Agent is unable to apply any U.S. Legal Tender
or U.S. Government Obligations in accordance with this Article Eight 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 Issuer's obligations under this Indenture and the Securities
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article Eight until such time as the Trustee or Paying Agent is permitted
to apply all such U.S. Legal Tender or U.S. Government Obligations in accordance
with thisArticle Eight; provided that if the Issuer has made any payment of
--------
interest on, premium, if any, or principal of any Securities because of the
reinstatement of its obligations, the Issuer shall be subrogated to the rights
of the Holders of such Securities to receive such payment from the U.S. Legal
Tender or U.S. Government Obligations held by the Trustee or Paying Agent.
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ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
9.1. Without Consent of Holders.
--------------------------
Subject to Section 9.3, the Issuer, any Guarantors and the Trustee,
together, may amend or supplement this Indenture, the Securities or any
Guarantee without notice to or consent of any Securityholder:
(i) to cure any ambiguity, defect or inconsistency, so long
as such change does not, in the good faith determination of the Board
of Directors of the Company, adversely affect the rights of any of the
Holders in any material respect. In formulating its determination on
such matters, the Board of Directors of the Company will be entitled to
rely on such evidence as it deems appropriate;
(ii) to evidence the succession in accordance with Article
Five of another Person to the Company and the assumption by any such
successor of the covenants of the Company herein and in the Securities;
(iii) to provide for uncertificated Securities in addition
to or in place of certificated Securities;
(iv) to make any other change that does not adversely affect
the rights of any Securityholders hereunder in any material respect;
(v) to comply with any requirements of the Commission in
connection with the qualification of this Indenture under the TIA;
(vi) to add or release any Guarantor pursuant to the terms of
this Indenture; or
(vii) to provide for issuance of the Exchange Notes, which
will have terms substantially identical in all material respects to the
Initial Notes (except that the transfer restrictions contained in the
Initial Notes will be modified or eliminated, as appropriate), and
which will be treated together with any outstanding Initial Notes, as a
single issue of securities, provided that for purposes of this clause
--------
(vii), the terms Initial Notes and Exchange Notes, shall include any
other Securities issued in accordance with clause (iii) of the fourth
paragraph of Section 2.2 or Securities issued in exchange therefor
which are identical in all material respects to such Securities (except
that the transfer restrictions on the Securities issued in exchange for
Securities issued in accor-
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dance with clause (iii) of the fourth paragraph of Section 2.2 shall be
modified or eliminated, as appropriate);
provided that the Company has delivered to the Trustee an Opinion of Counsel and
- --------
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.1.
9.2. With Consent of Holders.
-----------------------
Subject to Sections 6.7 and 9.3, the Issuer, the Guarantors, and the
Trustee, together, with the written consent of the Holder or Holders of at least
a majority in aggregate principal amount of the outstanding Securities or any
Guarantee, may amend or supplement this Indenture, the Securities or the
Guarantees without notice to any other Securityholders. Subject to Sections 6.7
and 9.3, the Holder or Holders of a majority in aggregate principal amount of
the outstanding Securities may waive compliance by the Issuer with any provision
of this Indenture, the Securities or any Guarantee without notice to any other
Securityholder. Without the consent of each Securityholder affected, however, no
amendment, supplement or waiver, including a waiver pursuant to (and to the
extent provided in) Section 6.4, may:
(i) reduce the amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(ii) reduce the rate of or change or have the effect of
changing the time for payment of interest, including default interest,
on any Security;
(iii) reduce the principal of or change or have the effect of
changing the fixed maturity of any Security, or change the date on
which any Securities may be subject to redemption or reduce the
redemption price therefor;
(iv) make any Securities payable in money other than that
stated in the Securities;
(v) make any change in provisions of this Indenture
protecting the right of each Holder to receive payment of principal of,
premium, if any, and interest on such Security on or after the due date
thereof or to bring suit to enforce such payment, or permitting Holders
of a majority in principal amount of the Securities to waive Defaults
or Events of Default;
(vi) modify or change any provision of this Indenture or the
related definitions affecting the subordination or ranking of the
Securities or any Guarantee, in a manner which adversely affects the
Holders;
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(vii) amend, change or modify in any material respect the
obligation of the Issuer to make and consummate a Change of Control
Offer in the event of a Change of Control which has occurred or modify
any of the provisions or definitions with respect thereto after a
Change of Control has occurred;
(viii) make any changes in Section 6.4, 6.7 or this Section
9.2; or
(ix) release any Guarantor that is a Significant Subsidiary
from any of its obligations under its Guarantee or this Indenture other
than in accordance with the terms of this Indenture.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.2 becomes
effective, the Issuer shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Issuer to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
9.3. Effect on Senior Debt.
---------------------
No amendment of, or supplement or waiver to, this Indenture shall
adversely affect the rights of any holder of Senior Debt or Guarantor Senior
Debt under Article Ten or Twelve, as the case may be, without the consent of
such holder (or any Representative thereof, or other Person or Persons,
authorized to given such consent).
9.4. Compliance With TIA.
-------------------
From the date on which this Indenture is qualified under the TIA, every
amendment, waiver or supplement of this Indenture or the Securities or any
Guarantee shall comply with the TIA as then in effect.
9.5. Revocation and Effect of Consents.
---------------------------------
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by notice to the Trustee
or the Issuer received before the date on which the Trustee receives an
Officers' Cer-
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tificate certifying that the Holders of the requisite principal amount of
Securities have consented (and not theretofore revoked such consent) to the
amendment, supplement or waiver.
The Issuer may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the last
sentence of the immediately preceding paragraph, those Persons who were Holders
at such record date (or their duly designated proxies), and only those Persons,
shall be entitled to revoke any consent previously given, whether or not such
Persons continue to be Holders after such record date. No such consent shall be
valid or effective for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall bind
every Securityholder, unless it makes a change described in any of clauses (i)
through (vii) of Section 9.2, in which case, the amendment, supplement or waiver
shall bind only each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security; provided that any such waiver shall
--------
not impair or affect the right of any Holder to receive payment of principal of,
premium, if any, and interest on a Security, on or after the respective due
dates expressed in such Security, or to bring suit for the enforcement of any
such payment on or after such respective dates without the consent of such
Holder.
9.6. Notation on or Exchange of Securities.
-------------------------------------
If an amendment, supplement or waiver changes the terms of a Security,
the Issuer may require the Holder of the Security to deliver it to the Trustee.
The Issuer shall provide the Trustee with an appropriate notation on the
Security about the changed terms and cause the Trustee to return it to the
Holder at the Issuer's expense. Alternatively, if the Issuer or the Trustee so
determines, the Issuer in exchange for the Security shall issue and the Trustee
shall authenticate a new Security that reflects the changed terms. Failure to
make the appropriate notation or issue a new Security shall not affect the
validity and effect of such amendment, supplement or waiver.
9.7. Trustee To Sign Amendments, Etc.
-------------------------------
The Trustee shall execute any amendment, supplement or waiver authorized
pursuant to this Article Nine; provided that the Trustee may, but shall not be
--------
obligated to, execute any such amendment, supplement or waiver which affects the
Trustee's own rights, duties or immunities under this Indenture. The Trustee
shall be entitled to receive, and shall be fully protected in relying upon, an
Opinion of Counsel and an Officers' Certificate each complying with Sections
11.4 and 11.5 and stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article Nine is authorized or permitted by
this Indenture and constitutes the legal, valid and binding obligations of the
Issuer enforceable in accordance with its terms. Such Opinion of Counsel shall
be at the expense of the Issuer.
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ARTICLE X
SUBORDINATION OF SECURITIES
10.1. Securities Subordinated To Senior Debt.
--------------------------------------
Anything herein to the contrary notwithstanding, the Issuer, for itself
and its successors, and each Holder, by his, her or its acceptance of
Securities, agrees that the payment of all Obligations owing to the Holders in
respect of the Securities is subordinated, to the extent and in the manner
provided in this Article Ten, to the prior payment in full in cash or Cash
Equivalents of all Obligations on all existing and future Senior Debt (including
the Obligations with respect to the Credit Agreement).
This Article Ten shall constitute a continuing offer to all Persons who
become holders of, or continue to hold, Senior Debt, and such provisions are
made for the benefit of the holders of Senior Debt and such holders are made
obligees hereunder and any one or more of them may enforce such provisions.
10.2. Suspension of Payment When Senior Debt Is In Default.
----------------------------------------------------
(a) Unless Section 10.3 shall be applicable, if any default occurs and is
continuing in the payment when due, whether at maturity, upon any redemption, by
declaration or otherwise, of any principal of, premium, if any, liquidated
damages, if any, or other Obligations with respect to, any Designated Senior
Debt of the Issuer (a "Payment Default"), then no payment or distribution of any
---------------
kind or character shall be made by or on behalf of the Issuer or any other
Person on its behalf with respect to any Obligations on the Securities or to
purchase, repurchase, redeem or otherwise acquire or retire any of the
Securities for cash or property or otherwise or set aside any funds or make any
deposit with the Trustee for any such purpose (collectively, "pay the
-------
securities") until such Payment Default shall have been cured or waived or shall
- ----------
have ceased to exist or such Senior Debt as to which such Payment Default
relates shall have been paid in full in cash or Cash Equivalents, after which
the Issuer shall (subject to other provisions of this Article Ten) resume making
any and all required payments in respect of the Securities, including any missed
payments.
(b) Unless Section 10.3 shall be applicable, if any other event of
default (other than a Payment Default) occurs and is continuing with respect to
any Designated Senior Debt of the Issuer (as such event of default is defined in
the instrument creating or evidencing such Designated Senior Debt) permitting
the holders of such Designated Senior Debt then outstanding to accelerate the
maturity thereof (a "Non-payment Default") and if the Representative for such
-------------------
Designated Senior Debt gives written notice of the event of default to the
Trustee (a "Payment Blockage Notice"), then neither the Issuer nor any other
-----------------------
Person on its behalf shall pay the securities until the earliest to happen of
(i) the date on which all Non-payment De-
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faults are cured or waived (so long as no other Non-payment Default or Payment
Default exists), (ii) the 180/th/ day after the date on which the applicable
Payment Blockage Notice was received, unless the maturity of any Designated
Senior Debt has been accelerated or (iii) the date on which the Trustee receives
notice from the Representative for such Designated Senior Debt rescinding the
Payment Blockage Notice, unless the maturity of any Designated Senior Debt has
been accelerated. Notwithstanding anything herein to the contrary, no Payment
Blockage Notice may be delivered unless and until 360 consecutive days have
elapsed since the delivery of the immediately prior Payment Blockage Notice. For
all purposes of this Section 10.2(b), no event of default which existed or was
continuing on the date of the delivery of any Payment Blockage Notice with
respect to the Designated Senior Debt shall be, or be made, the basis for the
commencement of a second Payment Blockage Notice by the Representative of such
Designated Senior Debt whether or not within a period of 360 consecutive days,
unless such event of default shall have been cured or waived for a period of not
less than 90 consecutive days (however, any subsequent action, or any breach of
any financial covenants for a period commencing after the date of delivery of
such initial Payment Blockage Notice, that, in either case, would give rise to
an event of default pursuant to any provisions under which an event of default
previously existed or was continuing shall constitute a new event of default for
this purpose).
(c) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by the
foregoing provisions of this Section 10.2, such payment shall be held for the
benefit of, and shall be paid over or delivered to, the holders of Senior Debt
(pro rata to such holders on the basis of the respective amount of Senior Debt
--- ----
held by such holders) or their respective Representatives, as their respective
interests may appear. The Trustee shall be entitled to rely on information
regarding amounts then due and owing on the Senior Debt, if any, received from
the holders of Senior Debt (or their Representatives) or, if such information is
not received from such holders or their Representatives, from the Issuer and
only amounts included in the information provided to the Trustee shall be paid
to the holders of Senior Debt.
Nothing contained in this Article Ten shall limit the right of the
Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Section 6.2 or to pursue any rights or
remedies hereunder; provided that all Senior Debt thereafter due or declared to
--------
be due shall first be paid in full in cash or Cash Equivalents before the
Holders are entitled to receive any payment of any kind or character with
respect to Obligations on the Securities.
10.3. Securities Subordinated To Prior Payment of All Senior Debt on
Dissolution, Liquidation or Reorganization of the Issuer.
----------------------------------------------------------------------
(a) Upon any payment or distribution of assets of the Issuer of any kind
or character, whether in cash, property or securities, to creditors upon any
total or partial liquidation, disso-
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lution, winding-up, reorganization, assignment for the benefit of creditors or
marshaling of assets of the Issuer or in a total or partial bankruptcy,
reorganization, insolvency, receivership or other similar proceeding relating to
the Issuer or its respective properties, whether voluntary or involuntary, all
Obligations due or to become due upon all existing and future Senior Debt shall
first be paid in full in cash or Cash Equivalents before any payment or
distribution of any kind or character is made on account of any Obligations on
the Securities, or for the acquisition of any of the Securities for cash or
property or otherwise. Upon any such dissolution, winding-up, liquidation,
reorganization, receivership or similar proceeding, any payment or distribution
of assets of the Issuer of any kind or character, whether in cash, property or
securities, to which the Holders of the Securities or the Trustee under this
Indenture would be entitled, except for the provisions hereof, shall be paid by
the Issuer or by any receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, or by the Holders or by the
Trustee under this Indenture if received by them, directly to the holders of
Senior Debt (pro rata to such holders on the basis of the respective amounts of
--- ----
Senior Debt held by such holders) or their respective Representatives, or to the
trustee or trustees under any indenture pursuant to which any of such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of Senior Debt remaining unpaid until all such Senior
Debt has been paid in full in cash or Cash Equivalents after giving effect to
any concurrent payment, distribution or provision therefor to or for the holders
of Senior Debt.
(b) To the extent any payment of Senior Debt (whether by or on behalf of
the Issuer, as proceeds of security or enforcement of any right of setoff or
otherwise) is declared to be fraudulent or preferential, set aside or required
to be paid to any receiver, trustee in bankruptcy, liquidating trustee, agent or
other similar Person under any bankruptcy, insolvency, receivership, fraudulent
conveyance or similar law, then, if such payment is recovered by, or paid over
to, such receiver, trustee in bankruptcy, liquidating trustee, agent or other
similar Person, the Senior Debt or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if such payment
had not occurred.
(c) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Issuer of any kind or character, whether in cash,
property or securities, shall be received by the Trustee or any Holder when such
payment or distribution is prohibited by this Section 10.3, such payment or
distribution shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Debt (pro rata to such holders on the
--- ----
basis of the respective amount of Senior Debt held by such holders) or their
respective Representatives, or to the trustee or trustees under any indenture
pursuant to which any of such Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of Senior Debt
remaining unpaid until all such Senior Debt has been paid in full in cash or
Cash Equivalents, after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior Debt.
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(d) The consolidation of the Issuer with, or the merger of the Issuer
with or into, another corporation or the liquidation or dissolution of the
Issuer following the conveyance or transfer of all or substantially all of its
assets, to another corporation upon the terms and conditions provided in Article
Five and as long as permitted under the terms of the Senior Debt shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, assume such Issuer's obligations
hereunder in accordance with Article Five.
10.4. Payments May Be Paid Prior To Dissolution.
-----------------------------------------
Nothing contained in this Article Ten or elsewhere in this Indenture
shall prevent (i) the Issuer, except under the conditions described in Sections
10.2 and 10.3, from making payments at any time for the purpose of making
payments of principal of, premium, if any, and interest on the Securities, or
from depositing with the Trustee any moneys for such payments, or (ii) in the
absence of actual knowledge by the Trustee that a given payment would be
prohibited by Section 10.2 or 10.3, the application by the Trustee of any moneys
deposited with it for the purpose of making such payments of principal of,
premium, if any, and interest on, the Securities to the Holders entitled thereto
unless at least one Business Day prior to the date upon which such payment would
otherwise become due and payable a Responsible Officer shall have actually
received the written notice provided for in the first sentence of Section
10.2(b) or in Section 10.7 (provided that, notwithstanding the foregoing, the
--------
Holders receiving any payments made in contravention of Section 10.2 and/or 10.3
(and the respective such payments) shall otherwise be subject to the provisions
of Section 10.2 and Section 10.3). The Issuer shall give prompt written notice
to the Trustee of any dissolution, winding-up, liquidation or reorganization of
the Issuer, although any delay or failure to give any such notice shall have no
effect on the subordination provisions contained herein.
10.5. Holders To Be Subrogated To Rights of Holders of Senior Debt.
------------------------------------------------------------
Subject to the payment in full in cash or Cash Equivalents of all Senior
Debt, the Holders of the Securities shall be subrogated to the rights of the
holders of Senior Debt to receive payments or distributions of cash, property or
securities of the Issuer applicable to the Senior Debt until the Securities
shall be paid in full; and, for the purposes of such subrogation, no such
payments or distributions to the holders of the Senior Debt by or on behalf of
the Issuer, or by or on behalf of the Holders by virtue of this Article Ten,
which otherwise would have been made to the Holders shall, as between the Issuer
and the Holders, be deemed to be a payment by the Issuer to or on account of the
Senior Debt, it being understood that the provisions of this Article Ten are and
are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of Senior Debt, on the other hand.
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10.6. Obligations of The Issuer Unconditional.
---------------------------------------
Nothing contained in this Article Ten or elsewhere in this Indenture or
in the Securities is intended to or shall impair, as among the Issuer, its
creditors other than the holders of Senior Debt, and the Holders, the obligation
of the Issuer, which is absolute and unconditional, to pay to the Holders the
principal of, premium, if any, and any interest on the Securities as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Issuer other than the holders of the Senior Debt, nor shall anything herein
or therein prevent the Holder of any Security or the Trustee on its behalf from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, in respect of cash, property or
securities of the Issuer received upon the exercise of any such remedy.
10.7. Notice to Trustee.
-----------------
The Issuer shall give prompt written notice to a Responsible Officer of
the Trustee at its address set forth in Section 13.2 of any fact known to the
Issuer which would prohibit the making of any payment to or by the Trustee in
respect of the Securities pursuant to the provisions of this Article Ten,
although any delay or failure to give any such notice shall have no effect on
the subordination provisions contained herein. Regardless of anything to the
contrary contained in this Article Ten or elsewhere in this Indenture, the
Trustee shall not be charged with knowledge of the existence of any default or
event of default with respect to any Senior Debt or of any other facts which
would prohibit the making of any payment to or by the Trustee unless and until
the Trustee shall have received notice in writing from the Issuer, or from a
holder of Senior Debt or a Representative therefor, and, prior to the receipt of
any such written notice, the Trustee shall be entitled to assume (in the absence
of actual knowledge to the contrary) that no such facts exist (provided that,
--------
notwithstanding the foregoing, the Holders receiving any payments made in
contravention of Section 10.2 and/or 10.3 (and the respective such payments)
shall otherwise be subject to the provisions of Section 10.2 and Section 10.3).
The Trustee shall be entitled to rely on the delivery to it of any notice
pursuant to this Section 10.7 to establish that such notice has been given by a
holder of Senior Debt (or a Representative therefor). If the Trustee shall not
have received, at least one Business Day prior to the date upon which by the
terms hereof any such monies may become payable for any purpose, the notice
provided for in this Section, then anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
monies and to apply the same to the purpose for which they were received and
shall not be affected by any notice to the contrary which may be received by it
with one Business Day prior to such date (provided that, notwithstanding the
--------
foregoing, the Holders receiving any payments made in contravention of Section
10.2 and/or 10.3 (and the respective such payments) shall otherwise be subject
to the provisions of Section 10.2 and Section 10.3).
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In the event that the Trustee determines in good faith that any evidence
is required with respect to the right of any Person as a holder of Senior Debt
to participate in any payment or distribution pursuant to this Article Ten, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amounts of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Ten, 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.
10.8. Reliance on Judicial Order or Certificate of Liquidating Agent.
--------------------------------------------------------------
Upon any payment or distribution of assets of the Issuer referred to in
this Article Ten, the Trustee, subject to the provisions of Article Seven
hereof, and the Holders of the Securities shall be entitled to rely upon any
order or decree made by any court of competent jurisdiction in which any
insolvency, bankruptcy, receivership, dissolution, winding-up, liquidation,
reorganization or similar case or proceeding is pending, or upon a certificate
of the receiver, trustee in bankruptcy, liquidating trustee, assignee for the
benefit of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or the Holders of the Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Debt and other Indebtedness of the
Issuer or its Restricted Subsidiaries, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article Ten.
10.9. Trustee's Relation to Senior Debt.
---------------------------------
The Trustee and any agent of the Issuer or the Trustee shall be entitled
to all the rights set forth in this Article Ten with respect to any Senior Debt
which may at any time be held by it in its individual or any other capacity to
the same extent as any other holder of Senior Debt and nothing in this Indenture
shall deprive the Trustee or any such agent of any of its rights as such holder.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Ten, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt.
Whenever a distribution is to be made or a notice given to holders or
owners of Senior Debt, the distribution may be made and the notice may be given
to their Representative, if any.
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10.10. Subordination Rights Not Impaired By Acts or Omissions of The Issuer
or Holders of Senior Debt.
----------------------------------------------------------------------
No right of any present or future holders of any Senior Debt to enforce
subordination as provided herein shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Issuer or by any act or
failure to act, in good faith, by any such holder, or by any noncompliance by
the Issuer with the terms of this Indenture, regardless of any knowledge thereof
which any such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or any Holder of a Security, without
incurring responsibility to the Trustee or the Holders of the Securities and
without impairing or releasing the subordination provided in this Article Ten or
the obligations hereunder of the Holders of the Securities to the holders of the
Senior Debt, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, Senior
Debt, or otherwise amend or supplement in any manner Senior Debt, or any
instrument evidencing the same or any agreement under which Senior Debt is
outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt; (iii) release any Person
liable in any manner for the payment or collection of Senior Debt; and (iv)
exercise or refrain from exercising any rights against the Issuer and any other
Person.
10.11. Securityholders Authorize Trustee to Effectuate Subordination of
----------------------------------------------------------------
Securities.
----------
Each Holder of Securities by its acceptance of them authorizes and
expressly directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate, as between the holders of Senior Debt
and the Holders of Securities, the subordination provided in this Article Ten,
and appoints the Trustee its attorney-in-fact for such purposes, including, in
the event of any dissolution, winding-up, liquidation or reorganization of the
Issuer (whether in bankruptcy, insolvency, receivership, reorganization or
similar proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the business and/or assets of the
Issuer, the filing of a claim for the unpaid balance of its Securities and
accrued interest in the form required in those proceedings.
If the Trustee does not file a proper claim or proof of debt in the form
required in such proceeding prior to 30 days before the expiration of the time
to file such claim or claims, then the holders of the Senior Debt or their
Representative are or is hereby authorized to have the right to file and are or
is hereby authorized to file an appropriate claim for and on behalf of the
Holders of said Securities. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Senior Debt or their Representative to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the
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Trustee or the holders of Senior Debt or their Representative to vote in respect
of the claim of any Holder in any such proceeding.
10.12. This Article Ten Not to Prevent Events of Default.
-------------------------------------------------
The failure to make a payment on account of principal of, premium, if
any, or interest on the Securities by reason of any provision of this Article
Ten will not be construed as preventing the occurrence of an Event of Default.
10.13. Trustee's Compensation Not Prejudiced.
-------------------------------------
Nothing in this Article Ten will apply to amounts due to the Trustee in
its capacity as such pursuant to other sections of this Indenture.
ARTICLE XI
GUARANTEE OF SECURITIES
11.1. Unconditional Guarantee.
-----------------------
Subject to the provisions of this Article Eleven, each of the Guarantors,
upon the execution and delivery of a Guarantee pursuant to Section 4.15 or 4.20,
shall hereby, jointly and severally, unconditionally and irrevocably guarantee,
on a senior subordinated basis (such guarantees to be referred to herein as the
"Guarantees") to each Holder of a Security authenticated and delivered by the
----------
Trustee and to the Trustee and its successors and assigns, irrespective of the
validity and enforceability of this Indenture, the Securities or the obligations
of the Issuer or any other Guarantors to the Holders or the Trustee hereunder or
thereunder, that: (a) the principal of, premium, if any, and interest on the
Securities shall be duly and punctually paid in full when due, whether at
maturity, upon redemption at the option of Holders pursuant to the provisions of
the Securities relating thereto, by acceleration or otherwise, and interest on
the overdue principal and (to the extent permitted by law) interest, if any, on
the Securities and all other obligations of the Issuer or the Guarantors to the
Holders or the Trustee hereunder or thereunder (including amounts due the
Trustee under Section 7.7 hereof) and all other obligations shall be promptly
paid in full or performed, all in accordance with the terms hereof and thereof;
and (b) in case of any extension of time of payment or renewal of any Securities
or any of such other obligations, the same shall be promptly paid in full when
due or performed in accordance with the terms of the extension or renewal,
whether at maturity, by acceleration or otherwise. Failing payment when due of
any amount so guaranteed, or failing performance of any other obligation of the
Issuer to the Holders under this Indenture or under the Securities, for whatever
reason, each Guarantor shall be obligated to pay, or to perform or cause the
performance of, the same immediately. An Event of Default under this Indenture
or the Securities shall constitute an event of default under the Guarantees, and
shall entitle the
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Holders of Securities to accelerate the obligations of the Guarantors hereunder
in the same manner and to the same extent as the obligations of the Issuer.
Each of the Guarantors, upon the execution and delivery of a Guarantee
pursuant to Section 4.15 or 4.20, shall hereby agree that its obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities with
respect to any provisions hereof or thereof, any release of any other Guarantor,
the recovery of any judgment against the Issuer, any action to enforce the same,
whether or not a Guarantee is affixed to any particular Security, or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of a Guarantor. Each of the Guarantors, upon the execution and delivery
of a Guarantee pursuant to Section 4.15 or 4.20, shall hereby waive the benefit
of diligence, presentment, demand of payment, filing of claims with a court in
the event of insolvency or bankruptcy of Issuer, any right to require a
proceeding first against the Issuer, protest, notice and all demands whatsoever
and covenants that its Guarantee shall not be discharged except by complete
performance of the obligations contained in the Securities, this Indenture and
the Guarantees. Each Guarantee is a guarantee of payment and not of collection.
If any Holder or the Trustee is required by any court or otherwise to return to
the Issuer or to any Guarantor, or any custodian, trustee, liquidator or other
similar official acting in relation to such Issuer or such Guarantor, any amount
paid by such Issuer or such Guarantor to the Trustee or such Holder, each
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Guarantor, upon the execution and delivery of a Guarantee
pursuant to Section 4.15 or 4.20, shall hereby further agree that, as between
it, on the one hand, and the Holders of Securities and the Trustee, on the other
hand, (a) subject to this Article Eleven, the maturity of the obligations
guaranteed hereby may be accelerated as provided in Article Six hereof for the
purposes of the Guarantees, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (b) in the event of any acceleration of such obligations
as provided in Article Six hereof, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Guarantors for the
purpose of the Guarantees.
No Affiliate, stockholder, officer, director, limited liability company
member or employee, past, present or future, of any Guarantor, as such, shall
have any personal liability under such Guarantor's Guarantee by reason of his,
her or its status as such Affiliate, stockholder, officer, director, limited
liability company member or employee.
11.2. Limitations on Guarantees.
-------------------------
The obligations of any Guarantor under its Guarantee shall be limited to
the maximum amount which, after giving effect to all other contingent and fixed
liabilities of such Guarantor (including all Guarantor Senior Debt of such
Guarantor) and after giving effect to any col-
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lections from or payments made by or on behalf of any other Guarantor in respect
of the obligations of such other Guarantor under its Guarantee or pursuant to
its contribution obligations under this Indenture, will result in the
obligations of such Guarantor under the Guarantee not constituting a fraudulent
conveyance or fraudulent transfer under federal or state law. Each Guarantor
that makes a payment or distribution under a Guarantee shall be entitled to a
contribution from each other Guarantor in an amount pro rata, based on the net
--- ----
assets of each Guarantor, determined in accordance with GAAP.
11.3. Execution and Delivery of Guarantee.
-----------------------------------
To further evidence the Guarantees set forth in Section 11.1, each
Guarantor, upon the execution and delivery of a Guarantee pursuant to Section
4.15 or 4.20, hereby agrees that a notation of its Guarantee, substantially in
the form of Exhibit E hereto, shall be endorsed on each Security authenticated
---------
and delivered by the Trustee. The Guarantee of any Guarantor shall be executed
on behalf of such Guarantor by either manual or facsimile signature of two
Officers of such Guarantor, each of whom, in each case, shall have been duly
authorized to so execute by all requisite corporate action. The validity and
enforceability of any Guarantee shall not be affected by the fact that it is not
affixed to any particular Security.
Each of the Guarantors, upon the execution and delivery of a Guarantee
pursuant to Section 4.15 or 4.20, hereby agrees that its Guarantee set forth in
Section 11.1 shall remain in full force and effect notwithstanding any failure
to endorse on each Security a notation of such Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Guarantee no longer holds that office at the time the Trustee authenticates the
Security on which such Guarantee is endorsed or at any time thereafter, such
Guarantor's Guarantee of such Security shall nevertheless be valid.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set forth in
this Indenture on behalf of each Guarantor.
11.4. Release of a Guarantor.
----------------------
(a) If no Default or Event of Default exists or would exist under this
Indenture, upon the sale or disposition of all of the Capital Stock of a
Guarantor by the Company or any Restricted Subsidiary of the Company, in a
transaction or series of related transactions that either (i) does not
constitute an Asset Sale or (ii) constitutes an Asset Sale and such Asset Sale
is not in violation of Section 4.18, or upon the consolidation or merger of a
Guarantor with or into any Person in compliance with Article Five (in each case,
other than to the Company or an Affiliate of the Company), or if any Guarantor
is dissolved or liquidated in accordance with this Indenture, such Guarantor's
Guarantee will be automatically discharged and such Guar-
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antor shall be released from all obligations under this Article Eleven without
any further action required on the part of the Trustee or any Holder. Any
Guarantor not so released or the entity surviving such Guarantor, as applicable,
shall remain or be liable under its Guarantee as provided in this Article
Eleven.
(b) In addition, each such Guarantee will be automatically discharged and
the Guarantor party thereto shall be released from all obligations under this
Article Eleven without any further action on the part of the Trustee or any
Holder upon (i) the release or discharge of the guarantee which resulted in the
creation of such Guarantee under such Section 4.15, except a discharge or
release by or as a result of payment under such Guarantee or (ii) the
designation of such Guarantor as an Unrestricted Subsidiary in accordance with
the provisions of this Indenture. Any Guarantor not so released or the entity
surviving such Guarantor, as applicable, shall remain or be liable under its
Guarantee as provided in this Article Eleven.
(c) The obligations of each Guarantor will be automatically released upon
such Guarantor ceasing to be a subsidiary of the Issuer as a result of any
foreclosure on any pledge or security interest securing Obligations with respect
to the Credit Agreement or other exercise of remedies in respect thereof if such
Guarantor is released from its guarantee of Obligations with respect to the
Credit Agreement.
(d) The Trustee shall deliver an appropriate instrument evidencing the
release of a Guarantor upon receipt of a request by the Issuer or such Guarantor
accompanied by an Officers' Certificate and an Opinion of Counsel certifying as
to the compliance with this Section 11.4; provided, however, that the legal
-------- -------
counsel delivering such Opinion of Counsel may rely as to matters of fact on one
or more Officers' Certificates of the Company.
The Trustee shall execute any documents reasonably requested by the
Issuer or a Guarantor in order to evidence the release of such Guarantor from
its obligations under its Guarantee endorsed on the Securities and under this
Article Eleven.
Except as set forth in Articles Four and Five and this Section 11.4,
nothing contained in this Indenture or in any of the Securities shall prevent
any consolidation or merger of a Guarantor with or into the Issuer or another
Guarantor or shall prevent any sale or conveyance of the property of a Guarantor
as an entirety or substantially as an entirety to the Issuer or another
Guarantor.
11.5. Waiver of Subrogation.
---------------------
Until this Indenture is discharged and all of the Securities are
discharged and paid in full, each Guarantor, upon the execution and delivery of
a Guarantee pursuant to Section 4.15 or 4.20, shall hereby irrevocably waive and
agrees not to exercise any claim or other rights which it may now or hereafter
acquire against the Issuer that arise from the existence, payment, performance
or enforcement of the Issuer's obligations under the Securities or this In-
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denture and such Guarantor's obligations under its Guarantee and this Indenture,
in any such instance, including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, indemnification, and any right to
participate in any claim or remedy of the Holders against the Issuer, whether or
not such claim, remedy or right arises in equity, or under contract, statute or
common law, including, without limitation, the right to take or receive from the
Issuer, directly or indirectly, in cash or other property or by setoff or in any
other manner, payment or security on account of such claim or other rights. If
any amount shall be paid to any Guarantor in violation of the preceding sentence
and any amounts owing to the Trustee or the Holders of Securities under the
Securities, this Indenture, or any other document or instrument delivered under
or in connection with such agreements or instruments, shall not have been paid
in full, such amount shall have been deemed to have been paid to such Guarantor
for the benefit of, and held in trust for the benefit of, the Trustee or the
Holders and shall forthwith be paid to the Trustee for the benefit of itself or
such Holders to be credited and applied to the obligations in favor of the
Trustee or the Holders, as the case may be, whether matured or unmatured, in
accordance with the terms of this Indenture. Each Guarantor acknowledges that it
will receive direct and indirect benefits from the financing arrangements
contemplated by this Indenture and that the waiver set forth in this Section
11.5 is knowingly made in contemplation of such benefits.
11.6. Immediate Payment.
-----------------
Each Guarantor, upon the execution and delivery of a Guarantee pursuant
to Section 4.15 or 4.20, shall hereby agree to make immediate payment to the
Trustee, on behalf of the Holders or itself, of all Obligations due and owing or
payable to the respective Holders or the Trustee upon receipt of a demand for
payment therefor by the Trustee to such Guarantor in writing.
11.7. No Setoff.
---------
Each payment to be made by a Guarantor hereunder in respect of the
Obligations shall be payable in the currency or currencies in which such
Obligations are denominated, and shall be made without setoff, counterclaim,
reduction or diminution of any kind or nature.
11.8. Obligations Absolute.
--------------------
The obligations of each Guarantor hereunder are and shall be absolute and
unconditional and any monies or amounts expressed to be owing or payable by each
Guarantor hereunder which may not be recoverable from such Guarantor on the
basis of a Guarantee shall be recoverable from such Guarantor as a primary
obligor and principal debtor in respect thereof.
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11.9. Obligations Continuing.
----------------------
The obligations of each Guarantor hereunder shall be continuing and shall
remain in full force and effect until all the obligations have been paid and
satisfied in full. Upon the execution and delivery of a Guarantee pursuant to
Section 4.15 or 4.20, each Guarantor shall hereby agree with the Trustee that it
will from time to time deliver to the Trustee suitable acknowledgments of its
continued liability hereunder and under any other instrument or instruments in
such form as counsel to the Trustee may advise and as will prevent any action
brought against it in respect of any default hereunder being barred by any
statute of limitations now or hereafter in force and, in the event of the
failure of a Guarantor so to do, it hereby irrevocably appoints the Trustee the
attorney and agent of such Guarantor to make, execute and deliver such written
acknowledgment or acknowledgments or other instruments as may from time to time
become necessary or advisable, in the judgment of the Trustee on the advice of
counsel, to fully maintain and keep in force the liability of such Guarantor
hereunder and under its Guarantee.
11.10. Obligations Not Reduced.
-----------------------
The obligations of each Guarantor hereunder shall not be satisfied,
reduced or discharged solely by the payment of such principal, premium, if any,
interest, fees and other monies or amounts as may at any time prior to discharge
of this Indenture pursuant to Article Eight be or become owing or payable under
or by virtue of or otherwise in connection with the Securities or this
Indenture.
11.11. Obligations Reinstated.
----------------------
The obligations of each Guarantor hereunder shall continue to be
effective or shall be reinstated, as the case may be, if at any time any payment
which would otherwise have reduced the obligations of any Guarantor hereunder
(whether such payment shall have been made by or on behalf of the Issuer or by
or on behalf of a Guarantor) is rescinded or reclaimed from any of the Holders
upon the insolvency, bankruptcy, liquidation or reorganization of the Issuer or
any Guarantor or otherwise, all as though such payment had not been made. If
demand for, or acceleration of the time for, payment by the Issuer is stayed
upon the insolvency, bankruptcy, liquidation or reorganization of such Issuer,
all such Indebtedness otherwise subject to demand for payment or acceleration
shall nonetheless be payable by each Guarantor as provided herein.
11.12. Obligations Not Affected.
------------------------
The obligations of each Guarantor hereunder shall not be affected,
impaired or diminished in any way by any act, omission, matter or thing
whatsoever, occurring before, upon or after any demand for payment hereunder
(and whether or not known or consented to by any Guarantor or any of the
Holders) which, but for this provision, might constitute a whole or
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partial defense to a claim against any Guarantor hereunder or might operate to
release or otherwise exonerate any Guarantor from any of its obligations
hereunder or otherwise affect such obligations, whether occasioned by default of
any of the Holders or otherwise, including, without limitation:
(i) any limitation of status or power, disability,
incapacity or other circumstance relating to the Issuer or any other
Person, including any insolvency, bankruptcy, liquidation,
reorganization, readjustment, composition, dissolution, winding-up or
other proceeding involving or affecting such Issuer or any other
Person;
(ii) any irregularity, defect, unenforceability or
invalidity in respect of any indebtedness or other obligation of the
Issuer or any other Person under this Indenture, the Securities or any
other document or instrument;
(iii) any failure of the Issuer, whether or not without
fault on its part, to perform or comply with any of the provisions of
this Indenture or the Securities, or to give notice thereof to a
Guarantor;
(iv) the taking or enforcing or exercising or the refusal
or neglect to take or enforce or exercise any right or remedy from or
against the Issuer or any other Person or their respective assets or
the release or discharge of any such right or remedy;
(v) the granting of time, renewals, extensions,
compromises, concessions, waivers, releases, discharges and other
indulgences to the Issuer or any other Person;
(vi) any change in the time, manner or place of payment of,
or in any other term of, any of the Securities, or any other amendment,
variation, supplement, replacement or waiver of, or any consent to
departure from, any of the Securities or this Indenture, including,
without limitation, any increase or decrease in the principal amount of
or premium, if any, or interest on any of the Securities;
(vii) any change in the ownership, control, name, objects,
businesses, assets, capital structure or constitution of the Issuer or
a Guarantor;
(viii) any merger or amalgamation of the Issuer or a
Guarantor with any Person or Persons;
(ix) the occurrence of any change in the laws, rules,
regulations or ordinances of any jurisdiction by any present or future
action of any governmental authority or court amending, varying,
reducing or otherwise affecting, or purporting to amend, vary, reduce
or otherwise affect, any of the Obligations or the obligations of a
Guarantor under its Guarantee; and
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(x) any other circumstance, including release of a Guarantor
pursuant to Section 11.4 (other than by complete, irrevocable payment)
that might otherwise constitute a legal or equitable discharge or
defense of the Issuer under this Indenture or the Securities or of
another Guarantor in respect of its Guarantee hereunder;
provided, that the provisions of this Section 11.12 are not intended to affect
- --------
in any way any release of a Guarantor in accordance with the provisions of
Section 11.4.
11.13. Waiver.
------
Without in any way limiting the provisions of Section 11.1 hereof, each
Guarantor, upon the execution and delivery of a Guarantee pursuant to Section
4.15 or 4.20, shall hereby waive notice of acceptance hereof, notice of any
liability of any Guarantor hereunder, notice or proof of reliance by the Holders
upon the obligations of any Guarantor hereunder, and diligence, presentment,
demand for payment on the Issuer, protest, notice of dishonor or nonpayment of
any of the Obligations, or other notice or formalities to the Issuer or any
Guarantor of any kind whatsoever.
11.14. No Obligation to Take Action Against The Issuer.
-----------------------------------------------
Neither the Trustee nor any other Person shall have any obligation to
enforce or exhaust any rights or remedies or to take any other steps under any
security for the Obligations or against the Issuer or any other Person or any
property of such Issuer or any other Person before the Trustee is entitled to
demand payment and performance by any or all Guarantors of their liabilities and
obligations under their Guarantees or under this Indenture.
11.15. Dealing With the Issuer and Others.
----------------------------------
The Holders, without releasing, discharging, limiting or otherwise
affecting in whole or in part the obligations and liabilities of any Guarantor
and without the consent of or notice to any Guarantor, may
(i) grant time, renewals, extensions, compromises,
concessions, waivers, releases, discharges and other indulgences to the
Issuer or any other Person;
(ii) take or abstain from taking security or collateral from
the Issuer or from perfecting security or collateral of the Issuer;
(iii) release, discharge, compromise, realize, enforce or
otherwise deal with or do any act or thing in respect of (with or
without consideration) any and all collateral, mortgages or other
security given by the Issuer or any third party with respect to the
obligations or matters contemplated by this Indenture or the
Securities;
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(iv) accept compromises or arrangements from the Issuer;
(v) apply all monies at any time received from the Issuer
or from any security upon such part of the Obligations as the Holders
may see fit or change any such application in whole or in part from
time to time as the Holders may see fit; and
(vi) otherwise deal with, or waive or modify their right to
deal with, the Issuer and all other Persons and any security as the
Holders or the Trustee may see fit.
11.16. Default and Enforcement.
-----------------------
If any Guarantor fails to pay in accordance with Section 11.6 hereof,
the Trustee may proceed in its name as trustee hereunder in the enforcement of
the Guarantee of any such Guarantor and such Guarantor's obligations thereunder
and hereunder by any remedy provided by law, whether by legal proceedings or
otherwise, and to recover from such Guarantor the obligations.
11.17. Amendment, Etc.
--------------
No amendment, modification or waiver of any provision of this Indenture
relating to any Guarantor or consent to any departure by any Guarantor or any
other Person from any such provision will in any event be effective unless it is
signed by such Guarantor and the Trustee.
11.18. Acknowledgment.
--------------
Each Guarantor, upon the execution and delivery of a Guarantee pursuant
to Section 4.15 or 4.20, shall hereby acknowledge communication of the terms of
this Indenture and the Securities and shall hereby consent to and approves of
the same.
11.19. Costs and Expenses.
------------------
Each Guarantor shall pay on demand by the Trustee any and all costs,
fees and expenses (including, without limitation, legal fees on a solicitor and
client basis) incurred by the Trustee, its agents, advisors and counsel or any
of the Holders in enforcing any of their rights under any Guarantee.
11.20. No Merger or Waiver; Cumulative Remedies.
----------------------------------------
No Guarantee shall operate by way of merger of any of the obligations
of a Guarantor under any other agreement, including, without limitation, this
Indenture. No failure to exercise and no delay in exercising, on the part of the
Trustee or the Holders, any right, remedy, power or privilege hereunder or under
this Indenture or the Securities, shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, remedy, power or privi-
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lege hereunder or under this Indenture or the Securities preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges in the Guarantee
and under this Indenture, the Securities and any other document or instrument
between a Guarantor and/or the Issuer and the Trustee are cumulative and not
exclusive of any rights, remedies, powers and privilege provided by law.
11.21. Survival of Obligations.
-----------------------
Without prejudice to the survival of any of the other obligations of
any Guarantor hereunder, the obligations of each Guarantor under Section 11.1
shall survive the payment in full of the Obligations under the Securities, but
only if and to the extent such payment is avoided, and in such case shall be
enforceable against such Guarantor to the same extent as prior to any such
payment and without regard to and without giving effect to any defense, right of
offset or counterclaim available to or which may be asserted by the Issuer or
any Guarantor.
11.22. Guarantee in Addition to Other Obligations.
------------------------------------------
The Obligations of each Guarantor under its Guarantee and this
Indenture are in addition to and not in substitution for any other Obligations
to the Trustee or to any of the Holders in relation to this Indenture or the
Securities and any guarantees or security at any time held by or for the benefit
of any of them.
11.23. Severability.
------------
Any provision of this Article Eleven which is prohibited or
unenforceable in any jurisdiction shall not invalidate the remaining provisions
and any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction
unless its removal would substantially defeat the basic intent, spirit and
purpose of this Indenture and this Article Eleven.
11.24. Successors and Assigns.
----------------------
Each Guarantee shall be binding upon and inure to the benefit of each
Guarantor and the Trustee and the other Holders and their respective successors
and permitted assigns, except that no Guarantor may assign any of its
obligations hereunder or thereunder, except as otherwise permitted in this
Indenture.
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ARTICLE XII
SUBORDINATION OF SUBSIDIARY GUARANTEE
12.1. Guarantee Obligations Subordinated to Guarantor Senior Debt.
-----------------------------------------------------------
Anything herein to the contrary notwithstanding, each of the
Guarantors, for itself and its successors, and each Holder, by his, her or its
acceptance of Guarantees, agrees that the payment of all Obligations owing to
the Holders in respect of its Guarantee (collectively, as to any Guarantor, its
"Guarantee Obligations") is subordinated, to the extent and in the manner
---------------------
provided in this Article Twelve, to the prior payment in full in cash or Cash
Equivalents of all Obligations on all existing and future Guarantor Senior Debt
of such Guarantor (including the Obligations with respect to the Credit
Agreement).
This Article Twelve shall constitute a continuing offer to all Persons
who become holders of, or continue to hold, Guarantor Senior Debt, and such
provisions are made for the benefit of the holders of Guarantor Senior Debt and
such holders are made obligees hereunder and any one or more of them may enforce
such provisions.
12.2. Suspension Of Guarantee Obligations When Guarantor
Senior Debt Is in Default.
---------------------------------------------------
(a) Unless Section 12.3 shall be applicable, if any payment default
occurs and is continuing with respect to any Guarantor Senior Debt, then no
payment of any kind or character shall be made by or on behalf of such Guarantor
or any other Person on its behalf with respect to any Guarantee Obligations or
to acquire any of the Securities for cash or property or otherwise and until
such payment default shall have been cured or waived or shall have ceased to
exist or such Guarantor Senior Debt shall have been discharged or paid in full
in cash or Cash Equivalents, after which such Guarantor shall (subject to the
other provisions of this Article Twelve) resume making any and all required
payments in respect of its obligations under its Guarantee, including any missed
payments.
(b) At any time while any Payment Blockage Notice is in existence,
neither any Guarantor nor any other Person on any Guarantor's behalf shall (x)
make any payment of any kind or character with respect to any Obligations on its
Guarantee or (y) acquire any of the Securities for cash or otherwise.
(c) In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by the
foregoing provisions of this Section 12.2, such payment shall be held for the
benefit of, and shall be paid over or delivered to, the holders of Guarantor
Senior Debt (pro rata to such holders on the basis of the respective amount of
--- ----
Guarantor Senior Debt held by such holders) or their respective Representa-
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tives, as their respective interests may appear. The Trustee shall be entitled
to rely on information regarding amounts then due and owing on the Guarantor
Senior Debt, if any, received from the holders of Guarantor Senior Debt (or
their Representatives) or, if such information is not received from such holders
or their Representatives, from a Guarantor and only amounts included in the
information provided to the Trustee shall be paid to the holders of Guarantor
Senior Debt.
12.3. Guarantee Obligations Subordinated To Prior Payment of All
Guarantor Senior Debt on Dissolution, Liquidation or Reorganization of
Such Guarantor.
----------------------------------------------------------------------
(a) Upon any payment or distribution of assets of any Guarantor of any
kind or character, whether in cash, property or securities, to creditors upon
any liquidation, dissolution, winding-up, reorganization, assignment for the
benefit of creditors or marshaling of assets of such Guarantor or in a
bankruptcy, reorganization, insolvency, receivership or other similar proceeding
relating to such Guarantor or its property, whether voluntary or involuntary,
all Obligations due or to become due upon all Guarantor Senior Debt shall first
be paid in full in cash or Cash Equivalents before any payment or distribution
of any kind or character is made on account of any Guarantee Obligations or for
the acquisition of any of the Securities for cash or property or otherwise. Upon
any such dissolution, winding-up, liquidation, reorganization, receivership or
similar proceeding, any payment or distribution of assets of such Guarantor of
any kind or character, whether in cash, property or securities, to which the
Holders or the Trustee under this Indenture would be entitled, except for the
provisions hereof, shall be paid by such Guarantor or by any receiver, trustee
in bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the Holders or by the Trustee under this Indenture if
received by them, directly to the holders of Guarantor Senior Debt (pro rata to
such holders on the basis of the respective amounts of Guarantor Senior Debt
held by such holders) or their respective Representatives, or to the trustee or
trustees under any indenture pursuant to which any of such Guarantor Senior Debt
may have been issued, as their respective interests may appear, for application
to the payment of Guarantor Senior Debt remaining unpaid until all such
Guarantor Senior Debt has been paid in full in cash or Cash Equivalents after
giving effect to any concurrent payment, distribution or provision therefor to
or for the holders of Guarantor Senior Debt.
(b) To the extent any payment of Guarantor Senior Debt (whether by or
on behalf of a Guarantor, as proceeds of security or enforcement of any right of
setoff or otherwise) is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar Person under any bankruptcy, insolvency, receivership,
fraudulent conveyance or similar law, then, if such payment is recovered by, or
paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent
or other similar Person, the Guarantor Senior Debt or part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred.
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(c) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of any Guarantor of any kind or character, whether in
cash, property or securities, shall be received by the Trustee or any Holder
when such payment or distribution is prohibited by this Section 12.3, such
payment or distribution shall be held for the benefit of, and shall be paid over
or delivered to, the holders of Guarantor Senior Debt (pro rata to such holders
--- ----
on the basis of the respective amount of Guarantor Senior Debt held by such
holders) or their respective Representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Guarantor Senior Debt may have
been issued, as their respective interests may appear, for application to the
payment of Guarantor Senior Debt remaining unpaid until all such Guarantor
Senior Debt has been paid in full in cash or Cash Equivalents, after giving
effect to any concurrent payment, distribution or provision therefor to or for
the holders of such Guarantor Senior Debt.
(d) The consolidation of any Guarantor with, or the merger of any Guarantor
with or into, another corporation or the liquidation or dissolution of a
Guarantor following the conveyance or transfer of all or substantially all of
its assets, to another corporation upon the terms and conditions provided in
Article Five and as long as permitted under the terms of the Guarantor Senior
Debt shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section if such other corporation shall,
as a part of such consolidation, merger, conveyance or transfer, assumes the
Guarantee of such Guarantor hereunder in accordance with Article Five.
12.4. Payments May Be Paid Prior to Dissolution.
-----------------------------------------
Nothing contained in this Article Twelve or elsewhere in this Indenture
shall prevent (i) any Guarantor, except under the conditions described in
Sections 12.2 and 12.3, from making payments at any time for the purpose of
making payments on Guarantee Obligations, or from depositing with the Trustee
any moneys for such payments, or (ii) in the absence of actual knowledge by the
Trustee that a given payment would be prohibited by Section 12.2 or 12.3, the
application by the Trustee of any moneys deposited with it for the purpose of
making such payments on Guarantee Obligations to the Holders entitled thereto
unless at least one Business Day prior to the date upon which such payment would
otherwise become due and payable a Responsible Officer shall have actually
received the written notice provided for in the first sentence of Section
10.2(b) or in Section 12.7 (provided that, notwithstanding the foregoing, the
--------
Holders receiving any payments made in contravention of Sections 12.2 and/or
12.3 (and the respective such payments) shall otherwise be subject to the
provisions of Section 12.2 and Section 12.3). Each Guarantor shall give prompt
written notice to the Trustee of any dissolution, winding-up, liquidation or
reorganization of such Guarantor, although any delay or failure to give any such
notice shall have no effect on the subordination provisions contained herein.
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12.5. Holders of Guarantee Obligations to Be Subrogated to Rights of Holders of
Guarantor Senior Debt.
-------------------------------------------------------------------------
Subject to the payment in full in cash or Cash Equivalents of all Guarantor
Senior Debt, the Holders of Guarantee Obligations of any Guarantor shall be
subrogated to the rights of the holders of Guarantor Senior Debt of such
Guarantor to receive payments or distributions of cash, property or securities
of such Guarantor applicable to such Guarantor Senior Debt until all amounts
owing on or in respect of the Guarantee Obligations shall be paid in full; and,
for the purposes of such subrogation, no such payments or distributions to the
holders of such Guarantor Senior Debt by or on behalf of such Guarantor, or by
or on behalf of the Holders by virtue of this Article Twelve, which otherwise
would have been made to the Holders shall, as between such Guarantor and the
Holders, be deemed to be a payment by such Guarantor to or on account of such
Guarantor Senior Debt, it being understood that the provisions of this Article
Twelve are and are intended solely for the purpose of defining the relative
rights of the Holders, on the one hand, and the holders of Guarantor Senior
Debt, on the other hand.
12.6. Obligations of the Guarantors Unconditional.
-------------------------------------------
Nothing contained in this Article Twelve or elsewhere in this Indenture or
in the Guarantees is intended to or shall impair, as among the Guarantors, their
creditors other than the holders of Guarantor Senior Debt, and the Holders, the
obligation of the Guarantors, which is absolute and unconditional, to pay to the
Holders all amounts due and payable under the Guarantees as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders and creditors of the
Guarantors other than the holders of the Guarantor Senior Debt, nor shall
anything herein or therein prevent any Holder or the Trustee on its behalf from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, in respect of cash, property or
securities of the Guarantors received upon the exercise of any such remedy.
12.7. Notice to Trustee.
-----------------
Each Guarantor shall give prompt written notice to a Responsible Officer of
the Trustee at its address set forth in Section 13.2 of any fact known to such
Guarantor which would prohibit the making of any payment to or by the Trustee in
respect of the Guarantees pursuant to the provisions of this Article Twelve,
although any delay or failure to give any such notice shall have no effect on
the subordination provisions contained herein. Regardless of anything to the
contrary contained in this Article Twelve or elsewhere in this Indenture, the
Trustee shall not be charged with knowledge of the existence of any default or
event of default with respect to any Guarantor Senior Debt or of any other facts
which would prohibit the making of any payment to or by the Trustee unless and
until the Trustee shall have received notice in writing from a Guarantor, or
from a holder of Guarantor Senior Debt or a Representative
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therefor, and, prior to the receipt of any such written notice, the Trustee
shall be entitled to assume (in the absence of actual knowledge to the contrary)
that no such facts exist (provided that, notwithstanding the foregoing, the
--------
Holders receiving any payments made in contravention of Section 12.2 and/or 12.3
(and the respective such payments) shall otherwise be subject to the provisions
of Section 12.2 and Section 12.3). The Trustee shall be entitled to rely on the
delivery to it of any notice pursuant to this Section 12.7 to establish that
such notice has been given by a holder of Guarantor Senior Debt (or a
Representative therefor). If the Trustee shall not have received, at least one
Business Day prior to the date upon which by the terms hereof any such monies
may become payable for any purpose, the notice provided for in this Section,
then anything herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such monies and to apply the same
to the purpose for which they were received and shall not be effected by any
notice to the contrary which may be received by it with one Business Day prior
to such date (provided that, notwithstanding the foregoing, the Holders
--------
receiving any payments made in contravention of Section 12.2 and/or 12.3 (and
the respective such payments) shall otherwise be subject to the provisions of
Section 12.2 and Section 12.3).
In the event that the Trustee determines in good faith that any evidence is
required with respect to the right of any Person as a holder of Guarantor Senior
Debt to participate in any payment or distribution pursuant to this Article
Twelve, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amounts of Guarantor Senior
Debt held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article Twelve, and if such evidence is not
furnished the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
12.8. Reliance on Judicial Order or Certificate of Liquidating Agent.
--------------------------------------------------------------
Upon any payment or distribution of assets of a Guarantor referred to in
this Article Twelve, the Trustee, subject to the provisions of Article Seven
hereof, and the Holders shall be entitled to rely upon any order or decree made
by any court of competent jurisdiction in which any insolvency, bankruptcy,
receivership, dissolution, winding-up, liquidation, reorganization or similar
case or proceeding is pending, or upon a certificate of the trustee in
bankruptcy, liquidating trustee, receiver, assignee for the benefit of
creditors, agent or other Person making such payment or distribution, delivered
to the Trustee or the Holders, for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of the
Guarantor Senior Debt and other Indebtedness of such Guarantor, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article Twelve.
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12.9. Trustee's Relation to Guarantor Senior Debt.
-------------------------------------------
The Trustee and any agent of a Guarantor or the Trustee shall be entitled
to all the rights set forth in this Article Twelve with respect to any Guarantor
Senior Debt which may at any time be held by it in its individual or any other
capacity to the same extent as any other holder of Guarantor Senior Debt and
nothing in this Indenture shall deprive the Trustee or any such agent of any of
its rights as such holder.
With respect to the holders of Guarantor Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article Twelve, and no implied covenants
or obligations with respect to the holders of Guarantor Senior Debt shall be
read into this Indenture against the Trustee. The Trustee shall not be deemed to
owe any fiduciary duty to the holders of Guarantor Senior Debt.
Whenever a distribution is to be made or a notice given to holders or
owners of Guarantor Senior Debt, the distribution may be made and the notice may
be given to their Representative, if any.
12.10. Subordination Rights Not Impaired by Acts or Omissions of the Guarantors
or Holders of Guarantor Senior Debt.
-------------------------------------------------------------------------
No right of any present or future holders of any Guarantor Senior Debt to
enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of any Guarantor
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by any Guarantor with the terms of this Indenture, regardless of
any knowledge thereof which any such holder may have or otherwise be charged
with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Guarantor Senior Debt may, at any time and from time to time, without
the consent of or notice to the Trustee or any Holder of a Security, without
incurring responsibility to the Trustee or the Holders of the Securities and
without impairing or releasing the subordination provided in this Article Twelve
or the obligations hereunder of the Holders of the Securities to the holders of
Guarantor Senior Debt, do any one or more of the following: (i) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, Guarantor Senior Debt, or otherwise amend or supplement in any manner
Guarantor Senior Debt, or any instrument evidencing the same or any agreement
under which Guarantor Senior Debt is outstanding; (ii) sell, exchange, release
or otherwise deal with any property pledged, mortgaged or otherwise securing
Guarantor Senior Debt; (iii) release any Person liable in any manner for the
payment or collection of Guarantor Senior Debt; and (iv) exercise or refrain
from exercising any rights against the Guarantors and any other Person.
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12.11. Holders Authorize Trustee to Effectuate Subordination of Guarantee
Obligations.
------------------------------------------------------------------
Each Holder of Guarantee Obligations by its acceptance of them authorizes
and expressly directs the Trustee on its behalf to take such action as may be
necessary or appropriate to effectuate, as between the holders of Guarantor
Senior Debt and the Holders, the subordination provided in this Article Twelve,
and appoints the Trustee its attorney-in-fact for such purposes, including, in
the event of any dissolution, winding-up, liquidation or reorganization of any
Guarantor (whether in bankruptcy, insolvency, receivership, reorganization or
similar proceedings or upon an assignment for the benefit of credits or
otherwise) tending towards liquidation of the business and assets of any
Guarantor, the filing of a claim for the unpaid balance under its Guarantee
Obligations and accrued interest in the form required in those proceedings.
If the Trustee does not file a proper claim or proof of debt in the form
required in such proceeding prior to 30 days before the expiration of the time
to file such claim or claims, then the holders of the Guarantor Senior Debt or
their Representative are or is hereby authorized to have the right to file and
are or is hereby authorized to file an appropriate claim for and on behalf of
the Holders of said Guarantee Obligations. Nothing herein contained shall be
deemed to authorize the Trustee or the holders of Guarantor Senior Debt or their
Representative to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Guarantee Obligations or the rights of any Holder thereof, or to
authorize the Trustee or the holders of Guarantor Senior Debt or their
Representative to vote in respect of the claim of any Holder in any such
proceeding.
12.12. This Article Twelve Not to Prevent Events of Default.
----------------------------------------------------
The failure to make a payment on account of principal of or interest on the
Guarantees by reason of any provision of this Article Twelve will not be
construed as preventing the occurrence of an Event of Default.
12.13. Trustee's Compensation Not Prejudiced.
-------------------------------------
Nothing in this Article Twelve will apply to amounts due to the Trustee in
its capacity as such pursuant to other sections of this Indenture.
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ARTICLE XIII
MISCELLANEOUS
13.1. TIA Controls.
------------
If any provision of this Indenture limits, qualifies, or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
13.2. Notices.
-------
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Issuer or a Guarantor:
Compass Minerals Group, Inc.
8300 College Boulevard
Overland Park, KS 66210
Attention: Chief Financial Officer
Fax No: (913) 338-7932
with a copy to:
Latham & Watkins
885 Third Avenue
New York, NY 10022
Attention: Gregory Ezring, Esq.
Fax No: (212) 751-4864
if to the Trustee:
The Bank for New York
c/o United States Trust Company of New York
114 West 47th Street
25th Floor
New York, New York 10036
Attention: Corporate Trust Department/Compass Minerals
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if to the Trustee for presentation of Securities for payment or for
registration of transfer or exchange:
The Bank of New York
c/o United States Trust Company of New York
30 Broad Street
14th Floor
New York, New York 10004-2304
Attention: Corporate Trust Department/Compass Minerals
Telephone: (212) 852-1662
Fax No: (646) 458-8104
The Issuer and the Trustee by written notice to each other such Person
may designate additional or different addresses for notices to such Person. Any
notice or communication to the Issuer and the Trustee, shall be deemed to have
been given or made as of the date so delivered if personally delivered; when
answered back, if telecopied; and five (5) calendar days after mailing if sent
by registered or certified mail, postage prepaid (except that a notice of change
of address shall not be deemed to have been given until actually received by the
addressee), except that, with respect to any mailing, notices to the Trustee
shall be deemed effective only upon receipt.
Any notice or communication mailed to a Securityholder shall be mailed
to him by first class mail or other equivalent means at his address as it
appears on the registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
13.3. Communications by Holders With Other Holders.
--------------------------------------------
Securityholders may communicate pursuant to TIA (S) 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Issuer, the Trustee, the Registrar and any other Person shall
have the protection of TIA (S) 312(c).
13.4. Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Issuer to the Trustee to take
any action under this Indenture, the Issuer shall furnish to the Trustee at the
request of the Trustee:
(i) an Officers' Certificate, in form and substance satisfactory
to the Trustee, stating that, in the opinion of the signers, all
conditions precedent to be performed
-130-
or effected by the Issuer, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(ii) an Opinion of Counsel stating that, in the opinion of such
counsel, any and all such conditions precedent have been complied with.
13.5. Statements Required in Certificate or Opinion.
---------------------------------------------
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture, other than the Officers' Certificate
required by Section 4.8, shall include:
(i) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(iii) a statement that, in the opinion of such Person, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(iv) a statement as to whether or not, in the opinion of each such
Person, such condition or covenant has been complied with; provided,
--------
however, that with respect to matters of fact an Opinion of Counsel may
-------
rely on an Officers' Certificate or certificates of public officials.
13.6. Rules by Trustee, Paying Agent, Registrar.
-----------------------------------------
The Trustee, Paying Agent or Registrar may make reasonable rules for its
functions.
13.7. Legal Holidays.
--------------
If a payment date is not a Business Day, payment may be made on the next
succeeding day that is a Business Day.
13.8. Governing Law.
-------------
THIS INDENTURE, THE SECURITIES AND ANY GUARANTEES WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS TO THE EXTENT THAT THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. Each
of the
-131-
parties hereto agrees to submit to the jurisdiction of the courts of the State
of New York in any action or proceeding arising out of or relating to this
Indenture, the Securities or any Guarantees.
13.9. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan or debt
agreement of any of the Company or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
13.10. No Recourse Against Others.
--------------------------
No Affiliate, director, officer, employee, limited liability company
members or stockholder of the Company or any Subsidiary, as such, shall have any
liability for any obligations of the Issuer under the Securities or any
Guarantee or this Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Securityholder by accepting
a Security waives and releases all such liability. Such waiver and release are
part of the consideration for the issuance of the Securities.
13.11. Successors.
----------
All agreements of the Issuer and the Guarantors in this Indenture and the
Securities and the Guarantees shall bind their respective successors. All
agreements of the Trustee in this Indenture shall bind its successor.
13.12. Duplicate Originals.
-------------------
All parties may sign any number of copies of this Indenture. Each signed
copy or counterpart shall be an original, but all of them together shall
represent the same agreement.
13.13. Severability.
------------
In case any one or more of the provisions in this Indenture, the Securities
or the Guarantees shall be held invalid, illegal or unenforceable, in any
respect for any reason, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions shall not in
any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.
S-1
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed all as of the date first written above.
COMPASS MINERALS GROUP, INC.
By:_____________________________
Name:
Title:
GUARANTORS:
CAREY SALT COMPANY
GREAT SALT LAKE MINERALS
CORPORATION
GSL CORPORATION
NAMSCO INC.
NORTH AMERICAN SALT COMPANY,
each as a Guarantor
By:_____________________________
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By:_____________________________
Name:
Title:
Exhibit A
---------
[FORM OF INITIAL NOTE]/a/
[FACE OF SECURITY]
COMPASS MINERALS GROUP, INC.
10% Senior Subordinated Note due 2011
No. Principal Amount $
ISIN No.
CUSIP No.
COMPASS MINERALS GROUP, INC., a Delaware corporation (the "Company" or the
-------
"Issuer," which terms include any of its successors under the Indenture
------
hereinafter referred to), for value received promise to pay to CEDE & CO. or
registered assigns, the principal sum of Dollars ($ ) on August 15, 2011.
Interest Payment Dates: February 15 and August 15; commencing February 15,
2002.
Record Dates: February 1 and August 1.
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
__________________________
/a/ Add Private Placement Legend and, if appropriate, Global Security Legend.
A-1
IN WITNESS WHEREOF, the Issuer has caused this Security to be signed
manually or by facsimile by their duly authorized officers.
Dated:
COMPASS MINERALS GROUP, INC.
By:
----------------------------------------
Name:
Title:
A-2
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 10% Senior Subordinated Notes due 2011 described in the
within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:
-------------------------------------
Authorized Signatory
A-3
[REVERSE OF SECURITY]
COMPASS MINERALS GROUP, INC.
10% Senior Subordinated Note due 2011
1. Interest.
--------
COMPASS MINERALS GROUP, INC., a Delaware corporation (the "Company", or the
-------
"Issuer," which terms include any of its successors under the Indenture
------
hereinafter referred to), promise to pay interest on the principal amount of
this Security at the rate per annum shown above. The Issuer will pay interest
semiannually on February 15 and August 15 of each year (the "Interest Payment
----------------
Date"), commencing February 15, 2002. Interest on this Security will accrue from
- ----
the most recent date to which interest has been paid or, if no interest has been
paid, from and including November 28, 2001. Interest on this Security will be
computed on the basis of a 360-day year of twelve 30-day months.
The Issuer shall pay interest on overdue principal from time to time on
demand at the rate borne by this Security plus 2% and on overdue installments of
interest (without regard to any applicable grace periods) to the extent lawful.
2. Method of Payment.
-----------------
The Issuer shall pay interest on the Securities (except defaulted interest)
to the Persons who are the registered Holders at the close of business on the
Record Date immediately preceding the Interest Payment Date even if the
Securities are canceled on registration of transfer or registration of exchange
(including pursuant to an Exchange Offer (as defined in the Indenture)) after
such Record Date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuer shall pay principal, premium, if any and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Issuer
-----------------
may pay principal, premium, if any, and interest by wire transfer of federal
funds, or interest by check payable in such U.S. Legal Tender. The Issuer may
deliver any such interest payment to the Paying Agent or to a Holder at the
Holder's registered address.
3. Paying Agent and Registrar.
--------------------------
Initially, The Bank of New York (the "Trustee") will act as Paying Agent
-------
and Registrar. The Issuer may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders. The Company or any of its Subsidiaries may,
subject to certain exceptions, act as Registrar or co-Registrar.
A-4
4. Indenture.
---------
The Issuer issued the Securities under an Indenture, dated as of November
28, 2001 (the "Indenture"), among the Issuer, the Guarantors and the Trustee.
---------
This Security is one of a duly authorized issue of Securities of the Issuer
designated as their 10% Senior Subordinated Notes due 2011 (the "Initial
-------
Notes"). Capitalized terms herein are used as defined in the Indenture unless
- -----
otherwise defined herein. The terms of the Securities include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb) (the "TIA"), as in effect
---
on the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and Holders of Securities are referred
to the Indenture and the TIA for a statement of them. The Securities are general
obligations of the Issuer unlimited in amount, of which an aggregate principal
amount of $250,000,000 are being issued on the Issue Date.
5. Subordination.
-------------
The Securities are subordinated in right of payment, in the manner and to
the extent set forth in the Indenture, to the prior payment in full in cash or
Cash Equivalents of all Senior Debt of the Issuer, whether outstanding on the
date of the Indenture or thereafter created, incurred, assumed or guaranteed.
Each Holder by his acceptance hereof agrees to be bound by such provisions and
authorizes and expressly directs the Trustee, on his behalf, to take such action
as may be necessary or appropriate to effectuate the subordination provided for
in the Indenture and appoints the Trustee his attorney-in-fact for such
purposes.
6. Optional Redemption.
-------------------
The Issuer may redeem the Securities, in whole at any time or in part from
time to time, on and after August 15, 2006, upon not less than 30 nor more than
60 days' notice, at the following redemption prices (expressed as percentages of
the principal amount thereof) if redeemed during the twelve-month period
commencing on August 15 of the years set forth below, plus, in each case,
accrued and unpaid interest thereon, if any, to the date of redemption (subject
to the right of Holders of record on the relevant record date to receive
interest due on the relevant interest payment date):
Year Percentage
---- ----------
2006.................... 105.000%
2007.................... 103.333%
2008.................... 101.667%
2009 and thereafter..... 100.000%
The Issuer may redeem the Securities, at any time, or from time to time, on
or prior to August 15, 2004, by using the Net Cash Proceeds of one or more
Equity Offerings to redeem
A-5
up to 35% in aggregate principal amount of the Securities originally issued
under the Indenture at a redemption price equal to 110% of the principal amount
thereof plus accrued and unpaid interest thereon, if any, to the date of
redemption; provided, however, that after any such redemption the aggregate
principal amount of the Securities outstanding must equal at least 65% of the
aggregate amount of the Securities originally issued under the Indenture. In
order to effect the foregoing redemption with the net cash proceeds of any
Equity Offering, the Issuer shall make such redemption not more than 120 days
after the consummation of any such Equity Offering.
In addition, at any time prior to August 15, 2006, upon the occurrence of a
Change of Control, the Issuer may redeem the Securities, in whole but not in
part, at a redemption price equal to the principal amount thereof plus the
Applicable Premium plus accrued and unpaid interest, if any, to the date of
redemption (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date). Notice of
redemption of the Securities pursuant to this paragraph shall be mailed to
Holders of the Securities not more than 30 days following the occurrence of a
Change of Control.
7. Notice of Redemption.
--------------------
Notice of redemption shall 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 such Holder's registered address. Securities in
denominations of $1,000 may be redeemed only in whole. The Trustee may select
for redemption portions (equal to $1,000 or any integral multiple thereof) of
the principal of Securities that have denominations larger than $1,000.
If any Security is to be redeemed in part only, the notice of redemption
that relates to such Security shall state the portion of the principal amount
thereof to be redeemed. A new Security in a principal amount equal to the
unredeemed portion thereof will be issued in the name of the Holder thereof upon
cancellation of the original Security. On and after the Redemption Date,
interest will cease to accrue on Securities or portions thereof called for
redemption, subject to the provisions of the Indenture.
8. Change of Control Offer.
-----------------------
Upon the occurrence of a Change of Control, the Issuer will be required, as
and to the extent set forth in the Indenture, to offer to purchase all of the
outstanding Securities at a purchase price equal to 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, thereon to the date of
repurchase (subject to the right of Securityholders of record on the relevant
record date to receive interest due on the relevant interest payment date);
provided however, that notwithstanding the occurrence of a Change of Control,
- -------- -------
the Issuer shall not be obligated to repurchase the Securities pursuant to this
paragraph 8 in the event that the Issuer have exercised their right to redeem
all of the Securities under the terms of paragraph 6 hereof).
A-6
9. Limitation on Asset Sales.
-------------------------
The Issuer is, subject to certain conditions, obligated to make an offer to
purchase Securities at 100% of their principal amount, plus accrued and unpaid
interest, if any, thereon to the date of repurchase with certain Net Cash
Proceeds of certain sales or other dispositions of assets in accordance with the
Indenture.
10. Registration Rights.
-------------------
Pursuant to the Registration Rights Agreement, the Issuer will be obligated
to consummate an exchange offer pursuant to which the Holder of this Security
shall have the right to exchange this Security for the Issuer's 10% Senior
Subordinated Notes due 2011 (the "Exchange Notes"), which shall have been
--------------
registered under the Securities Act, in like principal amount and having terms
identical in all material respects to the Initial Notes. The Holders of the
Initial Notes shall be entitled to receive certain additional interest payments
in the event such exchange offer is not consummated and upon certain other
conditions, all pursuant to and in accordance with the terms of the Registration
Rights Agreement.
11. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. A Holder shall register the transfer of
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay certain transfer taxes or similar governmental
charges payable in connection therewith as permitted by the Indenture. The
Registrar need not register the transfer of or exchange any Securities or
portions thereof selected for redemption, except the unredeemed portion of any
security being redeemed in part.
12. Persons Deemed Owners.
---------------------
The registered Holder of a Security shall be treated as the owner of it for
all purposes.
13. Unclaimed Funds.
---------------
If funds for the payment of principal, premium, if any, or interest remain
unclaimed for two years, the Trustee and the Paying Agent will repay the funds
to the Issuer at their request. After that, all liability of the Trustee and
such Paying Agent with respect to such funds shall cease.
14. Discharge Prior to Redemption or Maturity.
-----------------------------------------
The Issuer and any Guarantor may be discharged from their obligations under
the Indenture or the Securities and any Guarantee except for certain provisions
thereof, and may be discharged from obligations to comply with certain covenants
contained in the Indenture and
A-7
the Securities and any Guarantee, in each case upon satisfaction of certain
conditions specified in the Indenture.
15. Amendment; Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture and the Securities and any
Guarantee may be amended or supplemented with the written consent of the Holders
of at least a majority in aggregate principal amount of the Securities then
outstanding, and any existing Default or Event of Default or compliance with any
provision may be waived with the consent of the Holders of a majority in
aggregate principal amount of the Securities then outstanding. Without notice to
or consent of any Holder, the parties thereto may amend or supplement the
Indenture, the Securities and the Guarantees, to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities and
any Guarantee in addition to or in place of certificated Securities or comply
with any requirements of the Commission in connection with the qualification of
the Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
16. Restrictive Covenants.
---------------------
The Indenture contains certain covenants that, among other things, limit
the ability of the Company and its Restricted Subsidiaries to make restricted
payments, to incur indebtedness, to create liens, to sell assets, to permit
restrictions on dividends and other payments by Restricted Subsidiaries of the
Company to the Company, to consolidate, merge or sell all or substantially all
of its assets or to engage in transactions with affiliates. The limitations are
subject to a number of important qualifications and exceptions. The Company must
annually report to the Trustee on compliance with such limitations.
17. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in aggregate principal amount of Securities then outstanding may
declare all the Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. Holders of Securities may not enforce
the Indenture, the Securities or any Guarantee except as provided in the
Indenture. The Trustee is not obligated to enforce the Indenture, the Securities
or the Guarantees, unless it has received indemnity satisfactory to it. The
Indenture permits, subject to certain limitations therein provided, Holders of a
majority in aggregate principal amount of the Securities or any Guarantee then
outstanding to direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders of Securities notice of certain continuing
Defaults or Events of Default if it determines that withholding notice is in
their interest.
A-8
18. Trustee Dealings with Issuer.
----------------------------
The Trustee under the Indenture, in its individual or any other capacity,
may become the owner or pledgee of Securities and may otherwise deal with the
Issuer, their Subsidiaries or their respective Affiliates as if it were not the
Trustee.
19. No Recourse Against Others.
--------------------------
No Affiliate, stockholder, director, officer, employee or limited liability
company member of the Issuer or any of their Subsidiaries shall have any
liability for any obligation of the Issuer under the Securities or the Indenture
or for any claim based on, in respect of or by reason of, such obligations or
their creation. Each Holder of a Security by accepting a Security waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
20. Authentication.
--------------
This Security shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on this Security.
21. Abbreviations and Defined Terms.
-------------------------------
Customary abbreviations may be used in the name of a Holder of a Security
or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by
the entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
22. Governing Law.
-------------
This Security shall be governed by, and construed in accordance with, the
laws of the State of New York without giving effect to applicable principles of
conflicts of laws to the extent that the application of the laws of another
jurisdiction would be required thereby.
23. CUSIP and ISIN Numbers.
----------------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuer have caused CUSIP and ISIN
numbers to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
24. Indenture.
---------
Each Holder, by accepting a Security, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.
A-9
The Issuer will furnish to any Holder of a Security upon written request
and without charge a copy of the Indenture which has the text of this Security
in larger type. Requests may be made to: Compass Minerals Group, Inc., 8300
College Boulevard, Overland Park, KS, 66210, Attn: Chief Financial Officer.
A-10
ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint _____________________________________ agent to transfer
this Security on the books of the Issuer. The agent may substitute another to
act for him.
Dated: ________________________ Signed: ____________________________
(Sign exactly as name
appears on the other side
of this Security)
Signature Guarantee: ____________________________________
Participant in a recognized
Signature Guarantee Medallion
Program (or other signature
guarantor program reasonably
acceptable to the Trustee)
In connection with any transfer of this Security occurring prior to the
date which is the earlier of (i) the date of the declaration by the Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act"), covering resales of this Security
(which effectiveness shall not have been suspended or terminated at the date of
the transfer) and (ii) November 28 2003, the undersigned confirms that it has
not utilized any general solicitation or general advertising in connection with
the transfer and that this Security is being transferred:
A-11
[Check One]
---------
[_] (1) to the Issuer or a subsidiary thereof; or
[_] (2) pursuant to and in compliance with Rule 144A under the Securities
Act; or
[_] (3) to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) that has
furnished to the Trustee a signed letter containing certain
representations and agreements (the form of which letter can be
obtained from the Trustee); or
[_] (4) outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act; or
[_] (5) pursuant to the exemption from registration provided by Rule 144
under the Securities Act; or
[_] (6) pursuant to an effective registration statement under the Securities
Act; or
[_] (7) pursuant to another available exemption from the registration
requirements of the Securities Act;
and unless the box below is checked, the undersigned confirms that such Security
is not being transferred to an "affiliate" of the Issuer as defined in Rule 144
---------
under the Securities Act of 1933, as amended (an "Affiliate"):
---------
[_] The transferee is an Affiliate of the Issuer.
Unless one of the items 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 that if box (3), (4), (5) or
--------
(7) is checked, the Issuer or the Trustee may require, prior to registering any
such transfer of the Securities, in its sole discretion, such legal opinions,
certifications (including an investment letter in the case of box (3) or (4))
and other information as the Trustee or the Issuer have 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.
A-12
If none of the foregoing boxes is checked, the Trustee or Registrar
shall not be obligated to register this Security in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.16 of the Indenture shall have
been satisfied.
Dated: __________________________ Signed: __________________________
(Sign exactly as name
appears on the other
side of this Security)
Signature Guarantee: __________________________________
TO BE COMPLETED BY PURCHASER IF (2) 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
- -------------------
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 Issuer as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: _________________________________________________
NOTICE: To be executed by an executive officer
A-13
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.17 or Section 4.18 of the Indenture, check the appropriate
box:
Section 4.17 [_] Section 4.18 [_]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.17 or Section 4.18 of the Indenture, state the
amount: $___________
Dated: ____________________ Signed: _________________________
(Sign exactly as name
appears on the other
side of this Security)
Signature Guarantee: _________________________________
Participant in a recognized
Signature Guarantee Medallion
Program (or other signature
guarantor program reasonably
acceptable to the Trustee)
A-14
Exhibit B
---------
[FORM OF EXCHANGE NOTE]/a/
[FACE OF SECURITY]
COMPASS MINERALS GROUP, INC.
10% Senior Subordinated Note due 2011
CUSIP No.
ISIN No.
No. $
COMPASS MINERALS GROUP, INC., a Delaware corporation (the "Company" or
-------
the "Issuer," which terms include any of its successors under the Indenture
------
hereinafter referred to), for value received promise to pay to CEDE & CO. or
registered assigns, the principal sum of Dollars ($), on August 15, 2011.
Interest Payment Dates: February 15 and August 15, commencing February
15, 2002.
Record Dates: February 1 and August 1.
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
______________________
a Add Private Placement Legend and, if appropriate, Global Security
Legend.
B-1
IN WITNESS WHEREOF, the Issuer has caused this Security to be signed
manually or by facsimile by their duly authorized officers.
Dated:
COMPASS MINERALS GROUP, INC.
By: ______________________________
Name:
Title:
B-2
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the 10% Senior Subordinated Notes due 2011 described in the
within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:______________________________
Authorized Signatory
B-3
[REVERSE OF SECURITY]
COMPASS MINERALS GROUP, INC.
10% Senior Subordinated Note due 2011
1. Interest.
--------
COMPASS MINERALS GROUP, INC., a Delaware corporation (the "Company" or
-------
the "Issuer," which terms include any of its successors under the Indenture
-----
hereinafter referred to), promise to pay interest on the principal amount of
this Security at the rate per annum shown above. The Issuer will pay interest
--- -----
semiannually on February 15 and August 15 of each year (the "Interest Payment
----------------
Date"), commencing February 15, 2002. Interest on this Security will accrue from
- ----
the most recent date to which interest has been paid or, if no interest has been
paid, from and including November 28, 2001. Interest on this Security will be
computed on the basis of a 360-day year of twelve 30-day months.
The Issuer shall pay interest on overdue principal from time to time on
demand at the rate borne by this Security plus 2% and on overdue installments of
interest (without regard to any applicable grace periods) to the extent lawful.
2. Method of Payment.
-----------------
The Issuer shall pay interest on the Securities (except defaulted
interest) to the Persons who are the registered Holders at the close of business
on the Record Date immediately preceding the Interest Payment Date even if the
Securities are canceled on registration of transfer or registration of exchange
(including pursuant to an Exchange Offer (as defined in the Indenture)) after
such Record Date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Issuer shall pay principal, premium, if any and interest
in money of the United States that at the time of payment is legal tender for
payment of public and private debts ("U.S. Legal Tender"). However, the Issuer
-----------------
may pay principal, premium, if any, and interest by wire transfer of federal
funds, or interest by check payable in such U.S. Legal Tender. The Issuer may
deliver any such interest payment to the Paying Agent or to a Holder at the
Holder's registered address.
3. Paying Agent and Registrar.
--------------------------
Initially, The Bank of New York (the "Trustee") will act as Paying
-------
Agent and Registrar. The Issuer may change any Paying Agent, Registrar or
co-Registrar without notice to the Holders. The Company or any of its
Subsidiaries may, subject to certain exceptions, act as Registrar or
co-Registrar.
B-4
4. Indenture.
---------
The Issuer issued the Securities under an Indenture, dated as of
November 28, 2001 (the "Indenture"), among the Issuer, the Guarantors and the
---------
Trustee. This Security is one of a duly authorized issue of Securities of the
Issuer designated as their 10% Senior Subordinated Notes due 2011 (the "Initial
-------
Notes"). Capitalized terms herein are used as defined in the Indenture unless
- -----
otherwise defined herein. The terms of the Securities include those stated in
the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb) (the "TIA"), as in effect
---
on the date of the Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the Indenture is
qualified under the TIA. Notwithstanding anything to the contrary herein, the
Securities are subject to all such terms, and Holders of Securities are referred
to the Indenture and the TIA for a statement of them. The Securities are general
obligations of the Issuer unlimited in amount, of which an aggregate principal
amount of $250,000,000 are being issued on the Issue Date.
5. Subordination.
-------------
The Securities are subordinated in right of payment, in the manner and
to the extent set forth in the Indenture, to the prior payment in full in cash
or Cash Equivalents of all Senior Debt of the Issuer, whether outstanding on the
date of the Indenture or thereafter created, incurred, assumed or guaranteed.
Each Holder by his acceptance hereof agrees to be bound by such provisions and
authorizes and expressly directs the Trustee, on his behalf, to take such action
as may be necessary or appropriate to effectuate the subordination provided for
in the Indenture and appoints the Trustee his attorney-in-fact for such
purposes.
6. Optional Redemption.
-------------------
The Issuer may redeem the Securities, in whole at any time or in part
from time to time, on and after August 15, 2006, upon not less than 30 nor more
than 60 days' notice, at the following redemption prices (expressed as
percentages of the principal amount thereof) if redeemed during the twelve-month
period commencing on August 15 of the years set forth below, plus, in each case,
accrued and unpaid interest thereon, if any, to the date of redemption (subject
to the right of Holders of record on the relevant record date to receive
interest due on the relevant interest payment date):
Year Percentage
---- ----------
2006......................... 105.000%
2007......................... 103.333%
2008......................... 101.667%
2009 and thereafter.......... 100.000%
The Issuer may redeem the Securities, at any time, or from time to
time, on or prior to August 15, 2004, by using the Net Cash Proceeds of one or
more Equity Offerings to redeem
B-5
up to 35% in aggregate principal amount of the Securities originally issued
under the Indenture at a redemption price equal to 110% of the principal amount
thereof plus accrued and unpaid interest thereon, if any, to the date of
redemption; provided, however, that after any such redemption the aggregate
principal amount of the Securities outstanding must equal at least 65% of the
aggregate amount of the Securities originally issued under the Indenture. In
order to effect the foregoing redemption with the net cash proceeds of any
Equity Offering, the Issuer shall make such redemption not more than 120 days
after the consummation of any such Equity Offering.
In addition, at any time prior to August 15, 2006, upon the occurrence
of a Change of Control, the Issuer may redeem the Securities, in whole but not
in part, at a redemption price equal to the principal amount thereof plus the
Applicable Premium plus accrued and unpaid interest, if any, to the date of
redemption (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date). Notice of
redemption of the Securities pursuant to this paragraph shall be mailed to
Holders of the Securities not more than 30 days following the occurrence of a
Change of Control.
7. Notice of Redemption.
--------------------
Notice of redemption shall 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 such Holder's registered address. Securities in
denominations of $1,000 may be redeemed only in whole. The Trustee may select
for redemption portions (equal to $1,000 or any integral multiple thereof) of
the principal of Securities that have denominations larger than $1,000.
If any Security is to be redeemed in part only, the notice of redemption
that relates to such Security shall state the portion of the principal amount
thereof to be redeemed. A new Security in a principal amount equal to the
unredeemed portion thereof will be issued in the name of the Holder thereof upon
cancellation of the original Security. On and after the Redemption Date,
interest will cease to accrue on Securities or portions thereof called for
redemption, subject to the provisions of the Indenture.
8. Change of Control Offer.
-----------------------
Upon the occurrence of a Change of Control, the Issuer will be required, as
and to the extent set forth in the Indenture, to offer to purchase all of the
outstanding Securities at a purchase price equal to 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, thereon to the date of
repurchase (subject to the right of Securityholders of record on the relevant
record date to receive interest due on the relevant interest payment date);
provided, however, that notwithstanding the occurrence of a Change of Control,
- -------- -------
the Issuer shall not be obligated to repurchase the Securities pursuant to this
paragraph 8 in the event that the Issuer have exercised their right to redeem
all of the Securities under the terms of paragraph 6 hereof).
B-6
9. Limitation on Asset Sales.
-------------------------
The Issuer is, subject to certain conditions, obligated to make an offer to
purchase Securities at 100% of their principal amount, plus accrued and unpaid
interest, if any, thereon to the date of repurchase with certain Net Cash
Proceeds of certain sales or other dispositions of assets in accordance with the
Indenture.
10. Denomination, Transfer, Exchange.
--------------------------------
The Securities are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. A Holder shall register the transfer of
or exchange Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay certain transfer taxes or similar governmental
charges payable in connection therewith as permitted by the Indenture. The
Registrar need not register the transfer of or exchange any Securities or
portions thereof selected for redemption, except the unredeemed portion of any
security being redeemed in part.
11. Persons Deemed Owners.
---------------------
The registered Holder of a Security shall be treated as the owner of it for
all purposes.
12. Unclaimed Funds.
---------------
If funds for the payment of principal, premium, if any, or interest remain
unclaimed for two years, the Trustee and the Paying Agent will repay the funds
to the Issuer at their request. After that, all liability of the Trustee and
such Paying Agent with respect to such funds shall cease.
13. Discharge Prior to Redemption or Maturity.
-----------------------------------------
The Issuer and the Subsidiary Guarantors, if any, may be discharged from
their obligations under the Indenture or the Securities and any Guarantee except
for certain provisions thereof, and may be discharged from obligations to comply
with certain covenants contained in the Indenture and the Securities and any
Guarantee, in each case upon satisfaction of certain conditions specified in the
Indenture.
14. Amendment; Supplement; Waiver.
-----------------------------
Subject to certain exceptions, the Indenture and the Securities and any
Guarantees may be amended or supplemented with the written consent of the
Holders of at least a majority in aggregate principal amount of the Securities
then outstanding, and any existing Default or Event of Default or compliance
with any provision may be waived with the consent of the Holders of a majority
in aggregate principal amount of the Securities then outstanding. Without notice
to or consent of any Holder, the parties thereto may amend or supplement the In
B-7
denture, the Securities and any Guarantee to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated Securities in
addition to or in place of certificated Securities or comply with any
requirements of the Commission in connection with the qualification of the
Indenture under the TIA, or make any other change that does not materially
adversely affect the rights of any Holder of a Security.
15. Restrictive Covenants.
---------------------
The Indenture contains certain covenants that, among other things, limit
the ability of the Company and its Restricted Subsidiaries to make restricted
payments, to incur indebtedness, to create liens, to sell assets, to permit
restrictions on dividends and other payments by Restricted Subsidiaries of the
Company to the Company, to consolidate, merge or sell all or substantially all
of its assets or to engage in transactions with affiliates. The limitations are
subject to a number of important qualifications and exceptions. The Company must
annually report to the Trustee on compliance with such limitations.
16. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing, the Trustee or the Holders
of at least 25% in aggregate principal amount of Securities then outstanding may
declare all the Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. Holders of Securities may not enforce
the Indenture, the Securities or any Guarantee except as provided in the
Indenture. The Trustee is not obligated to enforce the Indenture, the Securities
or the Guarantees, unless it has received indemnity satisfactory to it. The
Indenture permits, subject to certain limitations therein provided, Holders of a
majority in aggregate principal amount of the Securities then outstanding to
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of Securities notice of certain continuing Defaults or
Events of Default if it determines that withholding notice is in their interest.
17. Trustee Dealings with Issuer.
----------------------------
The Trustee under the Indenture, in its individual or any other capacity,
may become the owner or pledgee of Securities and may otherwise deal with the
Issuer, their Subsidiaries or their respective Affiliates as if it were not the
Trustee.
18. No Recourse Against Others.
--------------------------
No Affiliate, stockholder, director, officer, employee or limited liability
company member of the Issuer or any of their Subsidiaries shall have any
liability for any obligation of the Issuer under the Securities or the Indenture
or for any claim based on, in respect of or by reason of, such obligations or
their creation. Each Holder of a Security by accepting a Security waives and
releases all such liability. The waiver and release are part of the
consideration for the issuance of the Securities.
B-8
19. Authentication.
--------------
This Security shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on this Security.
20. Abbreviations and Defined Terms.
-------------------------------
Customary abbreviations may be used in the name of a Holder of a Security
or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by
the entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors
Act).
21. Governing Law.
-------------
This Security shall be governed by, and construed in accordance with, the
laws of the State of New York without giving effect to applicable principles of
conflicts of laws to the extent that the application of the laws of another
jurisdiction would be required thereby.
22. CUSIP and ISIN Numbers.
----------------------
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuer have caused CUSIP and ISIN
numbers to be printed on the Securities as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
23. Indenture.
---------
Each Holder, by accepting a Security, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.
The Issuer will furnish to any Holder of a Security upon written request
and without charge a copy of the Indenture which has the text of this Security
in larger type. Requests may be made to: Compass Minerals Group, Inc., 8300
College Boulevard, Overland Park, KS, 66210, Attn: Chief Financial Officer.
B-9
ASSIGNMENT FORM
I or we assign and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee or transferee)
________________________________________________________________________________
(Insert Social Security or other identifying number of assignee or transferee)
and irrevocably appoint __________________________________________ agent to
transfer this Security on the books of the Issuer. The agent may substitute
another to act for him.
Dated: __________________________ Signed: _________________________
(Sign exactly as name
appears on the other
side of this Security)
Signature Guarantee: _________________________________
Participant in a recognized
Signature Guarantee Medallion
Program (or other signature
guarantor program reasonably
acceptable to the Trustee)
B-10
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.17 or Section 4.18 of the Indenture, check the appropriate
box:
Section 4.17 [_] Section 4.18 [_]
If you want to elect to have only part of this Security purchased by the
Company pursuant to Section 4.17 or Section 4.18 of the Indenture, state the
amount: $___________
Dated: __________________________ Signed: _________________________
(Sign exactly as name
appears on the other
side of this Security)
Signature Guarantee: _________________________________
Participant in a recognized
Signature Guarantee Medallion
Program (or other signature
guarantor program reasonably
acceptable to the Trustee)
B-11
Exhibit C
---------
Form of Certificate to Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
-----------------------------------------
[Date]
Attention:
Re: Compass Minerals Group, Inc.
10% Senior Subordinated Notes due 2011
(the "Securities")
--------------------------------------
Ladies and Gentlemen:
In connection with our proposed purchase of the Securities of Compass
Minerals Group, Inc. (the "Issuer"), we confirm that:
------
1. We have received a copy of the Offering Circular (the "Offering
--------
Circular"), dated November 15, 2001 relating to the Securities and such other
- --------
information as we deem necessary in order to make our investment decision. We
acknowledge that we have read and agreed to the matters stated on pages (i) and
(ii) of the Offering Circular and in the section entitled "Transfer
Restrictions" of the Offering Circular, including the restrictions on
duplication and circulation of the Offering Circular.
2. We understand that any subsequent transfer of the Securities is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Securities (as described in the Offering Circular) and the
undersigned agrees to be bound by, and not to resell, pledge or otherwise
transfer the Securities except in compliance with, such restrictions and
conditions and the Securities Act of 1933, as amended (the "Securities Act").
--------------
3. We understand that the offer and sale of the Securities have not been
registered under the Securities Act, and that the Securities may not be offered
or sold except as permitted in the following sentence. We agree, on our own
behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell or otherwise transfer any Securities prior to the
date which is two years after the original issuance of the Securities, and if
such transfer is in respect of any aggregate principal amount of Securities of
less than $100,000, also furnishes an opinion of counsel acceptable to the
Issuer that such transfer complies with the Securities Act, we will do so only
(i) to the Issuer or any of their subsidiaries, (ii) inside the United States in
accordance with Rule 144A under the Securities Act to a "qualified institutional
-----------------------
buyer" (as defined in Rule 144A under the Securities Act), (iii) inside the
- -----
United States to an institutional "accredited investor" (as defined below) that,
-------------------
prior to such transfer, furnishes (or has furnished on its behalf by a U.S.
broker-dealer) to the Trustee (as
C-1
defined in the Indenture relating to the Securities), a signed letter containing
certain representations and agreements relating to the restrictions on transfer
of the Securities, (iv) outside the United States in accordance with Rule 904 of
Regulation S under the Securities Act, (v) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if available), or
(vi) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any person purchasing any of the Securities
from us a notice advising such purchaser that resales of the Securities are
restricted as stated herein.
4. We understand that, on any proposed resale of any Securities, we will
be required to furnish to the Trustee and the Issuer such certification, legal
opinions and other information as the Trustee and the Issuer may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Securities purchased by us will
bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
-------------------
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Securities, and we
and any accounts for which we are acting are each able to bear the economic risk
of our or their investment, as the case may be.
6. We are acquiring the Securities purchased by us for our account or for
one or more accounts (each of which is an institutional "accredited investor")
-------------------
as to each of which we exercise sole investment discretion, 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.
You and the Issuer are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
By:________________________________________
Name:
Title:
C-2
Exhibit D
---------
Form of Certificate To Be
Delivered in Connection with
Transfers Pursuant to Regulation S
[Date]
Attention:
Re: Compass Minerals Group, Inc.
10% Senior Subordinated Notes due 2011
(the "Securities")
------------------------------------------
In connection with our proposed sale of $_________ aggregate principal
amount of the Securities, we confirm that such sale has been effected pursuant
to and in accordance with Regulation S under the U.S. Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, we represent that:
--------------
(1) the offer of the Securities was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on our
behalf reasonably believed that the transferee was outside the United States, or
(b) the transaction was executed in, on or through the facilities of a
designated offshore securities market and neither we nor any person acting on
our behalf knows that the transaction has been prearranged with a buyer in the
United States;
(3) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) we have advised the transferee of the transfer restrictions
applicable to the Securities.
You and the Issuer are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby. Terms used in this certificate have the
meanings set forth in Regulation S.
D-1
Very truly yours,
[Name of Transferor]
By:_______________________________
Authorized Signature
D-2
Exhibit E
---------
GUARANTEE
For value received, the undersigned hereby unconditionally guarantees,
as principal obligor and not only as a surety, to the Holder of this Security
the cash payments in United States dollars of principal of, premium, if any, and
interest on this Security in the amounts and at the times when due and interest
on the overdue principal, premium, if any, and interest, if any, of this
Security, if lawful, and the payment or performance of all other obligations of
the Issuer under the Indenture (as defined below) or the Securities, to the
Holder of this Security and the Trustee, all in accordance with and subject to
the terms and limitations of this Security, Article Eleven of the Indenture and
this Guarantee. This Guarantee will become effective in accordance with Article
Eleven of the Indenture and its terms shall be evidenced therein. The validity
and enforceability of any Guarantee shall not be affected by the fact that it is
not affixed to any particular Security.
Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Indenture dated as of November 28, 2001, among Compass
Minerals Group, Inc., a Delaware corporation (the "Company" or the "Issuer"),
------- ------
the Guarantors, and The Bank of New York, as trustee (the "Trustee").
-------
The obligations of the undersigned to the Holders of Securities and to the
Trustee pursuant to this Guarantee and the Indenture are expressly set forth in
Article Eleven of the Indenture and reference is hereby made to the Indenture
for the precise terms of the Guarantee and all of the other provisions of the
Indenture to which this Guarantee relates.
The Guarantees are subordinated in right of payment, in the manner and to
the extent set forth in the Indenture, to the prior payment in full in cash or
Cash Equivalents of all Guarantor Senior Debt of each Guarantor, whether
outstanding on the date of the Indenture or thereafter created, incurred,
assumed or guaranteed. Each Holder by his acceptance hereof agrees to be bound
by such provisions and authorizes and expressly directs the Trustee, on his
behalf, to take such action as may be necessary or appropriate to effectuate the
subordination provided for in the Indenture and appoints the Trustee his
attorney-in-fact for such purposes.
THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAWS TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY. The undersigned Guarantor hereby agrees
to submit to the jurisdiction of the courts of the State of New York in any
action or proceeding arising out of or relating to this Guarantee.
This Guarantee is subject to release upon the terms set forth in the
Indenture.
E-1
IN WITNESS WHEREOF, each Guarantor has caused its Guarantee to be duly
executed.
CAREY SALT COMPANY
GREAT SALT LAKE MINERALS CORPORATION
GSL CORPORATION
NAMSCO INC.
NORTH AMERICAN SALT COMPANY
By:__________________________________
Name:
Title:
E-2