EXHIBIT 4.1
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PETERSEN PUBLISHING COMPANY, L.L.C.
and PETERSEN CAPITAL CORP.,
as ISSUERS,
PETERSEN HOLDINGS, L.L.C.
and
CERTAIN RESTRICTED SUBSIDIARIES,
as Guarantors
and
UNITED STATES TRUST COMPANY OF NEW YORK, as Trustee
____________________
INDENTURE
Dated as of November 15, 1996
____________________
$100,000,000
11 1/8% Senior Subordinated Notes due 2006
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CROSS-REFERENCE TABLE
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TIA Indenture
Section Section
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310(a)(1)............................................... 7.10
(a)(2)............................................... 7.10
(a)(3)............................................... N.A.
(a)(4)............................................... N.A.
(b) ................................................ 7.08; 7.10;
12.02
(b)(1)............................................... 7.10
(b)(9)............................................... 7.10
(c) ................................................ N.A.
311(a) ................................................ 7.11
(b) ................................................ 7.11
(c) ................................................ N.A.
312(a) ................................................ 2.05
(b) ................................................ 12.03
(c) ................................................ 12.03
313(a) ................................................ 7.06
(b)(1)............................................... 7.06
(b)(2)............................................... 7.06
(c) ................................................ 12.02
(d) ................................................ 7.06
314(a) ................................................ 4.02; 4.04
12.02
(b) ................................................ N.A.
(c)(1)............................................... 12.04; 12.05
(c)(2)............................................... 12.04; 12.05
(c)(3)............................................... N.A.
(d) ................................................ N.A.
(e) ................................................ 12.05
(f) ................................................ N.A.
315(a) ................................................ 7.01; 7.02
(b) ................................................ 7.05; 12.02
(c) ................................................ 7.01
(d) ................................................ 6.05; 7.01;
7.02
(e) ................................................ 6.11
316(a) (last sentence).................................. 12.06
(a)(1)(A)............................................ 6.05
(a)(1)(B)............................................ 6.04
(a)(2)............................................... 8.02
(b) ................................................ 6.07
(c) ................................................ 8.04
317(a)(1)............................................... 6.08
(a)(2)............................................... 6.09
(b) ................................................ 7.12
318(a) ................................................ 12.01
N.A. means Not Applicable
____________________
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions............................................ 1
Section 1.02. Other Definitions...................................... 25
Section 1.03. Incorporation by Reference of Trust Indenture Act...... 26
Section 1.04. Rules of Construction.................................. 27
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture............. 27
Section 2.01A. Depository Procedures.................................. 29
Section 2.01B. Exchanges of Book-Entry Notes for Certificated
Notes................................................ 33
Section 2.01C. Exchange between Regulation S Notes and Rule 144A
Notes and other Notes................................ 33
Section 2.02. Execution and Authentication........................... 34
Section 2.03. Registrar and Paying Agent............................. 35
Section 2.04. Paying Agent to Hold Money in Trust.................... 36
Section 2.05. Noteholder Lists....................................... 36
Section 2.06. Transfer and Exchange.................................. 37
Section 2.07. Replacement Notes...................................... 38
Section 2.08. Outstanding Notes...................................... 38
Section 2.09. Temporary Notes........................................ 39
Section 2.10. Cancellation........................................... 39
Section 2.11. Defaulted Interest..................................... 39
Section 2.12. Deposit of Moneys...................................... 40
Section 2.13. CUSIP Number........................................... 40
Section 2.14. Book-Entry Provisions for Global Notes................. 40
Section 2.15. Special Transfer Provisions............................ 42
Section 2.16. Computation of Interest................................ 44
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee..................................... 44
Section 3.02. Selection by Trustee of Notes to Be Redeemed........... 44
Section 3.03. Notice of Redemption................................... 45
Section 3.04. Effect of Notice of Redemption......................... 46
Section 3.05. Deposit of Redemption Price............................ 46
Section 3.06 Notes Redeemed in Part................................. 47
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ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes....................................... 47
Section 4.02. SEC Reports............................................ 47
Section 4.03. Waiver of Stay, Extension or Usury Laws................ 48
Section 4.04. Compliance Certificate................................. 49
Section 4.05. Taxes.................................................. 50
Section 4.06. Limitation on Additional Indebtedness.................. 50
Section 4.07. Limitation on Preferred Stock of Restricted
Subsidiaries.......................................... 51
Section 4.08. Limitation on Capital Stock of Restricted
Subsidiaries.......................................... 51
Section 4.09. Limitation on Restricted Payments...................... 52
Section 4.10. Limitation on Certain Asset Sales...................... 53
Section 4.11. Limitation on Transactions with Affiliates............. 56
Section 4.12. Limitations on Liens................................... 57
Section 4.13. Limitations on Investments............................. 58
Section 4.14. Limitation on Creation of Subsidiaries................. 58
Section 4.15. Limitation on Other Senior Subordinated Debt........... 58
Section 4.16. Limitation on Sale and Lease-Back Transactions......... 58
Section 4.17. Payments for Consent................................... 59
Section 4.18. Corporate Existence.................................... 59
Section 4.19. Change of Control...................................... 59
Section 4.20. Maintenance of Office or Agency........................ 62
Section 4.21. Maintenance of Properties; Insurance; Books and
Records; Compliance with Law.......................... 63
Section 4.22. Further Assurance to the Trustee....................... 63
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation, Merger and Sale of
Assets................................................ 64
Section 5.02. Successor Person Substituted........................... 65
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default...................................... 65
Section 6.02. Acceleration........................................... 67
Section 6.03. Other Remedies......................................... 68
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Section 6.04. Waiver of Past Defaults and Events of Default.......... 68
Section 6.05. Control by Majority.................................... 68
Section 6.06. Limitation on Suits.................................... 69
Section 6.07. Rights of Holders to Receive Payment................... 69
Section 6.08. Collection Suit by Trustee............................. 70
Section 6.09. Trustee May File Proofs of Claim....................... 70
Section 6.10. Priorities............................................. 71
Section 6.11. Undertaking for Costs.................................. 71
Section 6.12. Restoration of Rights and Remedies..................... 71
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee...................................... 72
Section 7.02. Rights of Trustee...................................... 73
Section 7.03. Individual Rights of Trustee........................... 74
Section 7.04. Trustee's Disclaimer................................... 74
Section 7.05. Notice of Defaults..................................... 74
Section 7.06. Reports by Trustee to Holders.......................... 75
Section 7.07. Compensation and Indemnity............................. 75
Section 7.08. Replacement of Trustee................................. 76
Section 7.09. Successor Trustee by Consolidation, Merger, Etc........ 78
Section 7.10. Eligibility; Disqualification.......................... 78
Section 7.11. Preferential Collection of Claims Against Company...... 78
Section 7.12. Paying Agents.......................................... 78
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders............................. 79
Section 8.02. With Consent of Holders................................ 79
Section 8.03. Compliance with Trust Indenture Act.................... 81
Section 8.04. Revocation and Effect of Consents...................... 81
Section 8.05. Notation on or Exchange of Notes....................... 82
Section 8.06. Trustee to Sign Amendments, etc........................ 82
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Discharge of Indenture................................. 83
Section 9.02. Legal Defeasance....................................... 83
Section 9.03. Covenant Defeasance.................................... 84
Section 9.04. Conditions to Defeasance or Covenant Defeasance........ 84
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Section 9.05. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions......... 87
Section 9.06. Reinstatement.......................................... 87
Section 9.07. Moneys Held by Paying Agent............................ 88
Section 9.08. Moneys Held by Trustee................................. 88
ARTICLE 10
GUARANTEE OF NOTES
Section 10.01. Guarantee.............................................. 89
Section 10.02. Execution and Delivery of Guarantees................... 90
Section 10.03. Limitation of Guarantee................................ 91
Section 10.04. Additional Guarantors.................................. 91
Section 10.05. Release of Guarantor................................... 91
Section 10.06. Guarantee Obligations Subordinated to Guarantor
Senior Indebtedness................................... 92
Section 10.07. Payment Over of Proceeds upon Dissolution, etc.,
of a Guarantor........................................ 92
Section 10.08. Suspension of Guarantee Obligations When Guarantor
Senior Indebtedness in Default........................ 94
Section 10.09. Subrogation to Rights of Holders of Guarantor Senior
Indebtedness.......................................... 96
Section 10.10. Guarantee Subordination Provisions Solely to Define
Relative Rights....................................... 97
Section 10.11. Application of Certain Article 11 Provisions........... 97
ARTICLE 11
SUBORDINATION OF NOTES
Section 11.01. Notes Subordinate to Senior Indebtedness............... 98
Section 11.02. Payment Over of Proceeds upon Dissolution, etc......... 98
Section 11.03. Suspension of Payment When Senior Indebtedness in
Default............................................... 100
Section 11.04. Trustee's Relation to Senior Indebtedness.............. 102
Section 11.05. Subrogation to Rights of Holders of Senior
Indebtedness.......................................... 102
Section 11.06. Provisions Solely to Define Relative Rights............ 103
Section 11.07. Trustee to Effectuate Subordination.................... 103
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Section 11.08. No Waiver of Subordination Provisions.................. 104
Section 11.09. Notice to Trustee...................................... 105
Section 11.10. Reliance on Judicial Order or Certificate of
Liquidating Agent..................................... 106
Section 11.11. Rights of Trustee as a Holder of Senior Indebtedness;
Preservation of Trustee's Rights...................... 106
Section 11.12. Article Applicable to Paying Agents.................... 106
Section 11.13. No Suspension of Remedies.............................. 107
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls........................... 107
Section 12.02. Notices................................................ 107
Section 12.03. Communications by Holders with Other Holders........... 109
Section 12.04. Certificate and Opinion as to Conditions Precedent..... 109
Section 12.05. Statements Required in Certificate and Opinion......... 109
Section 12.06. When Treasury Notes Disregarded........................ 110
Section 12.07. Rules by Trustee and Agents............................ 110
Section 12.08. Business Days; Legal Holidays.......................... 110
Section 12.09. Governing Law.......................................... 110
Section 12.10. No Adverse Interpretation of Other Agreements.......... 111
Section 12.11. No Recourse Against Others............................. 111
Section 12.12. Successors............................................. 111
Section 12.13. Multiple Counterparts.................................. 112
Section 12.14. Table of Contents, Headings, etc....................... 112
Section 12.15. Separability........................................... 112
EXHIBITS
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Exhibit A. Form of 144A Security...................................... A-1
Exhibit B. Form of Regulation S Security.............................. B-1
Exhibit C. Form of Legend for Global Securities....................... C-1
Exhibit D. Form of Certificate to Be Delivered in Connection
with Transfers to Non-QIB Accredited Investors........... D-1
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Exhibit E. Form of Certificate to Be Delivered in Connection
with Transfers Pursuant to Regulation S.................. E-1
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INDENTURE, dated as of November 15, 1996, among PETERSEN PUBLISHING
COMPANY, L.L.C., a Delaware limited liability company (the "Company"), and
PETERSEN CAPITAL CORP., a Delaware corporation ("Capital" and, together with the
Company, jointly and severally, the "Issuers"), the Guarantors (as hereinafter
defined) and United States Trust Company of New York, as trustee (the
"Trustee").
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders of the Company's 11 1/8% Senior
Subordinated Notes due 2006 (the "Notes").
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions.
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"Acquired Indebtedness" means Indebtedness of a Person (including an
Unrestricted Subsidiary) existing at the time such Person becomes a Restricted
Subsidiary or assumed in connection with the acquisition of assets from such
Person.
"Additional Interest" means additional interest on the Notes which the
Issuers and the Guarantors, jointly and severally, agree to pay to the Holders
pursuant to Section 4 of the Registration Rights Agreement.
"Adjusted Net Assets" of a Guarantor at any date shall mean the lesser
of the amount by which (x) the fair value of the property of such Guarantor
exceeds the total amount of liabilities, including, without limitation,
contingent liabilities (after giving effect to all other fixed and contingent
liabilities), but excluding liabilities under the Guarantee, of such Guarantor
at such date and (y) the present fair salable value of the assets of such
Guarantor at such date exceeds the amount that will be required to pay the
probable liability of such Guarantor on its debts (after giving effect to all
other fixed and contingent liabilities and after giving effect to any collection
from any Subsidiary of such Guarantor in respect of the obligations of such
Subsidiary under the Guarantee), excluding Indebtedness in respect of the
Guarantee, as they become absolute and matured.
"Affiliate" of any specified Person means any other Person which
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person. For the
purposes of this definition, "control" (including, with correlative meanings,
the
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terms "controlling," "controlled by," and "under common control with"), as
used with respect to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by agreement or
otherwise.
"Agent" means any Registrar, Paying Agent, or agent for service of
notices and demands.
"Asset Sale" means the sale, transfer or other disposition (other than
to the Company or any of its Restricted Subsidiaries) in any single transaction
or series of related transactions of (a) any Capital Stock of or other equity
interest in any Restricted Subsidiary of the Issuers, (b) all or substantially
all of the assets of the Issuers or of any Restricted Subsidiary thereof, (c)
real property or (d) all or substantially all of the assets of any magazine or
publishing property, or part thereof, owned by the Issuers or any Restricted
Subsidiary thereof, or a division, line of business or comparable business
segment of the Issuers or any Restricted Subsidiary thereof; provided that Asset
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Sales shall not include (i) sales, leases, conveyances, transfers or other
dispositions to the Company or to a Restricted Subsidiary or to any other Person
if after giving effect to such sale, lease, conveyance, transfer or other
disposition such other Person becomes a Restricted Subsidiary or (ii) the sale
or other disposition of any or all right, title and interest of the Company and
its Subsidiaries in and to the assets and properties (other than cash) directly
associated with the Scheduled Titles, and the sale or other disposition of any
Investments made by the contribution of any of the Scheduled Titles to a joint
venture, partnership or other Person (which may be a Subsidiary) as permitted by
clause (xii) of the definition of Permitted Investments.
"Asset Sale Proceeds" means, with respect to any Asset Sale, (i) cash
received by the Issuers or any Restricted Subsidiary from such Asset Sale
(including cash received as consideration for the assumption of liabilities
incurred in connection with or in anticipation of such Asset Sale), after (a)
provision for all income or other taxes measured by or resulting from such Asset
Sale, (b) payment of all brokerage commissions, underwriting and other fees and
expenses related to such Asset Sale, (c) provision for minority interest holders
in any Restricted Subsidiary as a result of such Asset Sale and (d) deduction of
appropriate amounts to be provided by the Issuers or a Restricted Subsidiary as
a reserve, in accordance with GAAP, against any liabilities associated with the
assets
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sold or disposed of in such Asset Sale and retained by the Issuers or a
Restricted Subsidiary after such Asset Sale, including, without limitation,
pension and other post-employment benefit liabilities and liabilities related to
environmental matters or against any indemnification obligations associated with
the assets sold or disposed of in such Asset Sale, and (ii) promissory notes and
other non-cash consideration received by the Issuers or any Restricted
Subsidiary from such Asset Sale or other disposition upon the liquidation or
conversion of such notes or non-cash consideration into cash.
"Attributable Indebtedness" in respect of a Sale and Lease-Back
Transaction means, as at the time of determination, the greater of (i) the fair
value of the property subject to such arrangement (as determined by the Board of
Directors) and (ii) the present value of the notes (discounted at a rate of 10%,
compounded annually) of the total obligations of the lessee for rental payments
during the remaining term of the lease included in such Sale and Lease-Back
Transaction (including any period for which such lease has been extended).
"Available Asset Sale Proceeds" means, with respect to any Asset Sale,
the aggregate Asset Sale Proceeds from such Asset Sale that have not been
applied in accordance with clause (iii)(a) or (iii)(b) of Section 4.10(a) and
which have not been the basis for an Excess Proceeds Offer in accordance with
clause (iii)(c) of Section 4.10(a).
"Board of Directors" with respect to any person means, (i) at any time
such Person is a limited liability company, the board of directors of its
managing member or, if such managing member is a limited liability company, the
board of directors of such managing member's managing member, and (ii) otherwise
the board of directors of such Person or any committee authorized to act
therefor.
"Board Resolution" means a copy of a resolution certified pursuant to
an Officers' Certificate to have been duly adopted by the Board of Directors of
an Issuer or a Guarantor, as appropriate, and to be in full force and effect,
and delivered to the Trustee.
"BrightView" means BrightView Communications Group, Inc., a Delaware
corporation.
"Capital" means the party named as such in the first paragraph of this
Indenture until a successor replaces such party
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pursuant to Article 5 of this Indenture and thereafter means the successor.
"Capital Stock" means, with respect to any Person, any and all shares
or other equivalents (however designated) of capital stock, partnership
interests or any other participation, right or other interest in the nature of
an equity interest in such Person or any option, warrant or other security
convertible into any of the foregoing.
"Capitalized Lease Obligations" means Indebtedness represented by
obligations under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP, and the amount of such Indebtedness
shall be the capitalized amount of such obligations determined in accordance
with GAAP.
"Cash Equivalents" means (i) direct obligations of the United States
of America or any agency thereof, or obligations guaranteed or insured by the
United States of America, provided that in each case such obligations mature
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within one year from the date of acquisition thereof, (ii) certificates of
deposit maturing within one year from the date of creation thereof issued by any
U.S. national or state banking institution having capital, surplus and undivided
profits aggregating at least $250,000,000 and at the time of investment rated at
least A-1 by S&P and P-1 by Moody's, (iii) commercial paper with a maturity of
180 days or less issued by a corporation (except an Affiliate of the Company)
organized under the laws of any state of the United States or the District of
Columbia and at the time of investment rated at least A-1 by S&P or at least P-1
by Moody's and (iv) repurchase agreements and reverse repurchase agreements
relating to marketable direct obligations issued or unconditionally guaranteed
by the United States of America or issued by an agency thereof and backed by the
full faith and credit of the United States of America, in each case maturing
within one year from the date of acquisition; provided that the terms of such
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agreements comply with the guidelines set forth in the Federal Financial
Agreements of Depository Institutions with Securities Dealers and Others, as
adopted by the Comptroller of the Currency and (v) tax-exempt auction rate
securities and municipal preferred stock, in each case, subject to reset no more
than 35 days after the date of acquisition and having a rating of at least AA by
S&P or AA by Moody's at the time of investment.
"Change of Control" means the occurrence of one or more of the
following events: (i) Holdings and BrightView collectively shall cease to own
all of the outstanding Capital
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Stock of the Company; (ii) prior to a Qualified IPO, (x) Holdings shall cease to
be the managing member of the Company or shall otherwise cease to have the sole
right and authority to exercise control over the management of the Company; (y)
BrightView shall cease to be the managing member of Holdings or shall otherwise
cease to have the sole right and authority to exercise control over the
management of Holdings; or (z) Willis Stein shall cease to have the power
(regardless of whether such power is exercised) to elect a majority of the Board
of Directors of BrightView; or (iii) in connection with or subsequent to a
Qualified IPO, any Person or group of Persons acting in concert as a partnership
or other group (other than the Permitted Holders) shall, as a result of a tender
or exchange offer, open market purchases, privately negotiated purchases or
otherwise, have become, after the date hereof, the "beneficial owner" (within
the meaning of such term under Rule 13d-3 under the Exchange Act) of securities
of Holdings or BrightView or such successor entity representing 20% or more of
the combined voting power of the then outstanding securities of Holdings or
BrightView or such successor entity, as the case may be, ordinarily (and apart
from rights accruing under special circumstances) having the right to vote in
the election of directors, managers or other members of its governing body.
"Commodity Hedge Agreement" shall mean any option, hedge or other
similar agreement or arrangement designed to protect against fluctuations in
commodity or materials prices.
"Common Stock" of any Person means all Capital Stock of such Person
that is generally entitled to (i) vote in the election of directors of such
Person or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or others
that will control the management and policies of such Person.
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces such party pursuant to Article 5 of this
Indenture and thereafter means the successor.
"Consolidated Interest Expense" means, with respect to any Person, for
any period, the aggregate amount of interest which, in conformity with GAAP,
would be set forth opposite the caption "interest expense" or any like caption
on an income statement for such Person and its Subsidiaries on a consolidated
basis (including, but not limited to, Redeemable Dividends, whether paid or
accrued, on Subsidiary Preferred Stock, imputed interest included in Capitalized
Lease Obligations, all commissions, discounts and other fees and charges owed
with
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respect to letters of credit and bankers' acceptance financing, the net
costs associated with hedging obligations, amortization of other financing fees
and expenses, the interest portion of any deferred payment obligation,
amortization of discount or premium, if any, and all other non-cash interest
expense (other than interest amortized to cost of sales)) plus, without
duplication, all net capitalized interest for such period and all interest
incurred or paid under any guarantee of Indebtedness (including a guarantee of
principal, interest or any combination thereof) of any Person, plus the amount
of all dividends or distributions paid on Disqualified Capital Stock (other than
dividends paid or payable in shares of Capital Stock of the Company).
"Consolidated Net Income" means, with respect to any Person, for any
period, the aggregate of the Net Income of such Person and its Subsidiaries for
such period, on a consolidated basis, determined in accordance with GAAP, minus
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Permitted Tax Distributions (to the extent such Permitted Tax Distributions are
made); provided, however, that (a) the Net Income of any Person (the "other
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Person") in which the Person in question or any of its Subsidiaries has less
than a 100% interest (which interest does not cause the net income of such other
Person to be consolidated into the net income of the Person in question in
accordance with GAAP) shall be included only to the extent of the amount of
dividends or distributions paid to the Person in question or the Subsidiary, (b)
the Net Income of any Subsidiary of the Person in question that is subject to
any restriction or limitation on the payment of dividends or the making of other
distributions (other than pursuant to the Notes or this Indenture) shall be
excluded to the extent of such restriction or limitation, (c) (i) the Net Income
of any Person acquired in a pooling of interests transaction for any period
prior to the date of such acquisition and (ii) any net gain (but not loss)
resulting from an Asset Sale by the Person in question or any of its
Subsidiaries other than in the ordinary course of business shall be excluded,
and (d) extraordinary gains and losses (including any related tax effects on the
Issuers) shall be excluded.
"Consolidated Net Worth" means, with respect to any Person at any
date, the consolidated stockholder's equity of such Person less the amount of
such stockholder's equity attributable to Disqualified Capital Stock of such
Person and its Subsidiaries, as determined in accordance with GAAP.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the
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date of execution of this Indenture is located at United States Trust Company of
New York, 114 West 47th Street, New York, New York 10036.
"Default" means any event that is, or with the passing of time or
giving of notice or both would be, an Event of Default.
"Depository" means, with respect to the Notes issued in the form of
one or more Global Notes, The Depository Trust Company or another Person
designated as Depository by the Issuers, which Person must be a clearing agency
registered under the Exchange Act.
"Designated Senior Indebtedness," as to the Company or any Guarantor,
as the case may be, means any Senior Indebtedness (a) under the Senior Credit
Facility or (b) which at the time of determination exceeds $25 million in
aggregate principal amount (or accreted value in the case of Indebtedness issued
at a discount) outstanding or available under a committed facility, and (i)
which is specifically designated in the instrument evidencing such Senior
Indebtedness as "Designated Senior Indebtedness" by such Person and (ii) as to
which the Trustee has been given written notice of such designation.
"Disqualified Capital Stock" means any Capital Stock of the Company or
a Restricted Subsidiary thereof 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), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the option of the holder thereof, in whole or in part, on or
prior to the maturity date of the Notes, for cash or securities constituting
Indebtedness. Without limitation of the foregoing, Disqualified Capital Stock
shall be deemed to include (i) any Preferred Stock of a Restricted Subsidiary of
the Company and (ii) any Preferred Stock of the Company, with respect to either
of which, under the terms of such Preferred Stock, by agreement or otherwise,
such Restricted Subsidiary or the Company is obligated to pay current dividends
or distributions in cash during the period prior to the maturity date of the
Notes; provided, however, that Preferred Stock of the Company or any Restricted
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Subsidiary thereof that is issued with the benefit of provisions requiring a
change of control offer to be made for such Preferred Stock in the event of a
change of control of the Company or such Restricted Subsidiary, which provisions
have substantially the same effect as the provisions
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described in Section 4.19, shall not be deemed to be Disqualified Capital Stock
solely by virtue of such provisions.
"EBITDA" means, for any Person, for any period, an amount equal to (a)
the sum of (i) Consolidated Net Income for such period, plus (ii) the provision
for taxes for such period based on income or profits to the extent such income
or profits were included in computing Consolidated Net Income and any provision
for taxes utilized in computing net loss under clause (i) hereof, plus (iii)
Consolidated Interest Expense for such period (but only including Redeemable
Dividends in the calculation of such Consolidated Interest Expense to the extent
that such Redeemable Dividends have not been excluded in the calculation of
Consolidated Net Income), plus (iv) depreciation for such period on a
consolidated basis, plus (v) amortization of intangibles for such period on a
consolidated basis, plus (vi) any other non-cash items reducing Consolidated Net
Income for such period, plus (vii) to the extent not already included in
Consolidated Net Income, all special management compensation earned or accrued
prior to the Issue Date to the extent paid or accrued in such Period, plus
(viii) Permitted Tax Distributions minus (b) all non-cash items increasing
Consolidated Net Income for such period, all for such Person and its
Subsidiaries determined in accordance with GAAP, except that with respect to the
Issuers each of the foregoing items shall be determined on a consolidated basis
with respect to the Issuers and their Restricted Subsidiaries only; provided,
--------
however, that, for purposes of calculating EBITDA during any fiscal quarter,
- -------
cash income from a particular Investment of such Person shall be included only
(x) if cash income has been received by such Person with respect to such
Investment during each of the previous four fiscal quarters, or (y) if the cash
income derived from such Investment is attributable to Temporary Cash
Investments.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"GAAP" means generally accepted accounting principles consistently
applied as in effect in the United States as of the date hereof.
"Guarantee" means the guarantee of the Obligations of the Issuers with
respect to the Notes by each Guarantor pursuant to the terms of Article 10
hereof.
"Guarantor" means Holdings and each Restricted Subsidiary of the
Issuers that hereafter becomes a Guarantor
-9-
pursuant to Section 10.04, and "Guarantors" means such entities, collectively.
"Guarantor Senior Indebtedness" means the principal of and premium, if
any, and interest (including, without limitation, interest accruing or that
would have accrued but for the filing of a bankruptcy, reorganization or other
insolvency proceeding whether or not such interest constitutes an allowable
claim in such proceeding) on, and any and all other fees, expense reimbursement
obligations, indemnities and other amounts due pursuant to the terms of all
agreements, documents and instruments providing for, creating, securing or
evidencing or otherwise entered into in connection with, (a) any Guarantor's
direct incurrence of any Indebtedness or its guarantee of all Indebtedness of
the Company or any Restricted Subsidiaries, in each case, owed to lenders under
the Senior Credit Facility, (b) all obligations of such Guarantor with respect
to any Interest Rate Agreement, (c) all obligations of such Guarantor to
reimburse any bank or other person in respect of amounts paid under letters of
credit, acceptances or other similar instruments, (d) all other Indebtedness of
such Guarantor which does not provide that it is to rank pari passu with or
---- -----
subordinate to the Guarantees and (e) all deferrals, renewals, extensions and
refundings of, and amendments, modifications and supplements to, any of the
Guarantor Senior Indebtedness described above. Notwithstanding anything to the
contrary in the foregoing, Guarantor Senior Indebtedness will not include (i)
Indebtedness of such Guarantor to any of its Subsidiaries, (ii) Indebtedness
represented by the Guarantees, (iii) any Indebtedness which by the express terms
of the agreement or instrument creating, evidencing or governing the same is
junior or subordinate in right of payment to any item of Guarantor Senior
Indebtedness, (iv) any trade payable arising from the purchase of goods or
materials or for services obtained in the ordinary course of business or (v)
Indebtedness incurred in violation of this Indenture, except if such
Indebtedness was incurred under the Senior Credit Facility based on financial
information and certificates provided by responsible officers of the Company and
relied on in good faith by the lenders thereunder in which event such
Indebtedness shall be deemed to have been incurred in compliance with this
Indenture and constitute Guarantor Senior Indebtedness.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"Holdings" means Petersen Holdings, L.L.C., a Delaware limited
liability company.
-10-
"incur" means, with respect to any Indebtedness or other obligation of
any Person, to create, issue, incur (by conversion, exchange or otherwise),
assume, guarantee or otherwise become liable in respect of such Indebtedness or
other obligation or the recording, as required pursuant to GAAP or otherwise, of
any such Indebtedness or other obligation on the balance sheet of such Person
(and "incurrence," "incurred," "incurrable," and "incurring" shall have meanings
correlative to the foregoing); provided that a change in GAAP that results in an
--------
obligation of such Person that exists at such time becoming Indebtedness shall
not be deemed an incurrence of such Indebtedness.
"Indebtedness" means (without duplication), with respect to any
Person, any indebtedness at any time outstanding, secured or unsecured,
contingent or otherwise, which is for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or only to a
portion thereof), or evidenced by bonds, notes, debentures or similar
instruments or representing the balance deferred and unpaid of the purchase
price of any property (excluding, without limitation, any balances that
constitute accounts payable or trade payables, and other accrued liabilities
arising in the ordinary course of business) if and to the extent any of the
foregoing indebtedness would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, and shall also include, to the extent
not otherwise included (i) any Capitalized Lease Obligations, (ii) obligations
secured by a Lien to which the property or assets owned or held by such Person
is subject, whether or not the obligation or obligations secured thereby shall
have been assumed (provided, however, that if such obligation or obligations
-------- -------
shall not have been assumed, the amount of such Indebtedness shall be deemed to
be the lesser of the principal amount of the obligation or the fair market value
of the pledged property or assets), (iii) guarantees of items of other Persons
which would be included within this definition for such other Persons (whether
or not such items would appear upon the balance sheet of the guarantor), (iv)
all obligations for the reimbursement of any obligor on any letter of credit,
banker's acceptance or similar credit transaction (provided that in the case of
--------
any such letters of credit, the items for which such letters of credit provide
credit support are those of other Persons which would be included within this
definition for such other Persons), (v) in the case of the Issuers, Disqualified
Capital Stock of the Issuers or any Restricted Subsidiary thereof, and (vi)
obligations of any such Person under any Interest Rate Agreement applicable to
any of the foregoing (if and to the extent such Interest Rate Agreement
obligations would
-11-
appear as a liability upon a balance sheet of such Person prepared in accordance
with GAAP). The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations as described
above and, with respect to contingent obligations, the maximum liability upon
the occurrence of the contingency giving rise to the obligation, provided (i)
--------
that the amount outstanding at any time of any Indebtedness issued with original
issue discount is the principal amount of such Indebtedness less the remaining
unamortized portion of the original issue discount of such Indebtedness at such
time as determined in conformity with GAAP and (ii) that Indebtedness shall not
include any liability for federal, state, local or other taxes. Notwithstanding
any other provision of the foregoing definition, any trade payable arising from
the purchase of goods or materials or for services obtained in the ordinary
course of business shall not be deemed to be "Indebtedness" of the Company or
any Restricted Subsidiary for purposes of this definition. Furthermore,
guarantees of (or obligations with respect to letters of credit supporting)
Indebtedness otherwise included in the determination of such amount shall not
also be included.
"Indenture" means this Indenture as amended, restated or supplemented
from time to time.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501 (a)(1), (2), (3) or
(7) promulgated under the Securities Act.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Notes.
"Interest Rate Agreement" shall mean any interest or foreign currency
rate swap, cap, collar, option, hedge, forward rate or other similar agreement
or arrangement designed to protect against fluctuations in interest rates or
currency exchange rates.
"Investments" means, directly or indirectly, any advance, account
receivable (other than an account receivable arising in the ordinary course of
business or acquired as part of the assets acquired by the Issuers in connection
with an acquisition of assets which is otherwise permitted by the terms of this
Indenture), loan or capital contribution to (by means of transfers of property
to others, payments for property or services for the account or use of others or
otherwise), the purchase of any stock, bonds, notes, debentures, partnership or
-12-
joint venture interests or other securities of, the acquisition, by purchase or
otherwise, of all or substantially all of the business or assets or stock or
other evidence of beneficial ownership of, any Person or the making of any
investment in any Person. Investments shall exclude (i) extensions of trade
credit on commercially reasonable terms in accordance with normal trade
practices and (ii) the repurchase of securities of any Person by such Person.
"Issue Date" means the date the Notes are first issued by the Issuers
and authenticated by the Trustee under this Indenture.
"Issuer Request" means any written request signed in the names of each
of the Issuers by the Chief Executive Officer, the President, any Vice
President, the Chief Financial Officer or the Treasurer of each of the Issuers
and attested to by the Secretary or any Assistant Secretary of each of the
Issuers.
"Issuers" means the parties named as such in the first paragraph of
this Indenture until a successor replaces such parties pursuant to Article 5 of
this Indenture and thereafter means the successor and any other obligor on the
Notes.
"Lien" means, with respect to any property or assets of any Person,
any mortgage or deed of trust, pledge, hypothecation, assignment, deposit
arrangement, security interest, lien, charge, easement, encumbrance, preference,
priority, or other security agreement or preferential arrangement of any kind or
nature whatsoever on or with respect to such property or assets (including,
without limitation, any Capitalized Lease Obligation, conditional sales, or
other title retention agreement having substantially the same economic effect as
any of the foregoing).
"Maturity Date" means November 15, 2006.
"Moody's" means Moody's Investors Service, Inc. and its successors.
"Net Income" means, with respect to any Person for any period, the net
income (loss) of such Person determined in accordance with GAAP.
"Net Proceeds" means (a) in the case of any sale of Capital Stock by
the Company or BrightView, the aggregate net proceeds received by the Company or
BrightView, after payment of expenses, commissions and the like incurred in
connection therewith, whether such proceeds are in cash or in property
-13-
(valued at the fair market value thereof, as determined in good faith by the
Board of Directors, at the time of receipt) and (b) in the case of any exchange,
exercise, conversion or surrender of outstanding securities of any kind for or
into shares of Capital Stock of the Company which is not Disqualified Capital
Stock, the net book value of such outstanding securities on the date of such
exchange, exercise, conversion or surrender (plus any additional amount required
to be paid by the holder to the Company upon such exchange, exercise, conversion
or surrender, less any and all payments made to the holders, e.g., on account of
---
fractional shares and less all expenses incurred by the Company in connection
therewith).
"Non-Payment Event of Default" means any event (other than a Payment
Default) the occurrence of which entitles one or more Persons to accelerate the
maturity of any Designated Senior Indebtedness.
"Non-U.S. Person" means a person who is not a U.S. person, as defined
in Regulation S.
"Notes" means the securities that are issued under this Indenture, as
amended or supplemented from time to time pursuant to this Indenture.
"Obligations" means, with respect to any Indebtedness, any principal,
premium, interest, penalties, fees, indemnifications, reimbursements, damages
and other expenses payable under the documentation governing such Indebtedness.
"Offering" means the offering of the Notes as described in the
Offering Memorandum.
"Offering Memorandum" means the Offering Memorandum dated November,
1996 pursuant to which the Notes were offered.
"Officer", with respect to any Person (other than the Trustee) means
the Chief Executive Officer, the President, any Vice President and the Chief
Financial Officer, the Treasurer or the Secretary of such Person, or any other
officer designated by the Board of Directors of such Person, as the case may be.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by the Chief Executive Officer, the President or any Vice
President and the Chief Financial Officer or any Treasurer of such Person that
shall comply with applicable provisions of this Indenture and delivered to the
Trustee.
-14-
"Opinion of Counsel" means a written opinion reasonably satisfactory
in form and substance to the Trustee from legal counsel which counsel is
reasonably acceptable to the Trustee stating the matters required by Section
12.05 and delivered to the Trustee.
"Payment Default" means any default, whether or not any requirement
for the giving of notice, the lapse of time or both, or any other condition to
such default becoming an Event of Default has occurred, in the payment of
principal of (or premium, if any) or interest on or any other amount payable in
connection with Designated Senior Indebtedness.
"Permitted Holders" means, collectively, Neal Vitale and each Person
who purchased Capital Stock of Holdings, BrightView or Petersen Investment Corp.
pursuant to the Securities Purchase Agreement.
"Permitted Indebtedness" means:
(i) Indebtedness of the Company or any Restricted Subsidiary arising
under or in connection with the Senior Credit Facility in an amount not to
exceed $260,000,000, less any mandatory prepayments actually made
thereunder (to the extent, in the case of payments of revolving credit
indebtedness, that the corresponding commitments have been permanently
reduced) or scheduled payments actually made thereunder;
(ii) Indebtedness under the Notes and the Guarantees;
(iii) Indebtedness not covered by any other clause of this definition
which is outstanding on the date of this Indenture;
(iv) Indebtedness of the Company to any Restricted Subsidiary and
Indebtedness of any Restricted Subsidiary to the Company or another
Restricted Subsidiary;
(v) Interest Rate Agreements;
(vi) [Intentionally blank];
(vii) Refinancing Indebtedness;
(viii) Indebtedness under Commodity Hedge Agreements entered into in the
ordinary course of business consistent
-15-
with reasonable business requirements and not for speculation;
(ix) Indebtedness of the type described in, and secured by Liens of
the type described in, clauses (ix) and (xix) of the definition of
Permitted Liens;
(x) Indebtedness consisting of guarantees made in the ordinary course
of business by the Company or any of its Subsidiaries of obligations of the
Issuers or any of their Subsidiaries, which obligations are otherwise
permitted under this Indenture;
(xi) Contingent Obligations of the Company or its Subsidiaries in
respect of customary indemnification and purchase price adjustment
obligations incurred in connection with an Asset Sale; provided that the
--------
maximum assumable liability in respect of all such obligations shall at no
time exceed the gross proceeds actually received by the Company and its
Subsidiaries in connection with such Asset Sale; and
(xii) Purchase Money Indebtedness of the Company and its Subsidiaries
and any refinancings, renewals or replacements of any such Purchase Money
Indebtedness (subject to the limitations on the principal amount thereof
set forth in this clause (xii), and other Indebtedness that is unsecured
(other than Indebtedness specified in clauses (i) through (x) above), which
Purchase Money Indebtedness and other unsecured Indebtedness shall not
exceed $10,000,000 in the aggregate at any time.
"Permitted Investments" means, for any Person, Investments made on or
after the date of this Indenture consisting of:
(i) Investments by the Company or by a Restricted Subsidiary
thereof, in the Company or a Restricted Subsidiary;
(ii) Temporary Cash Investments;
(iii) Investments by the Company, or by a Restricted Subsidiary
thereof, in a Person, if as a result of such Investment (a) such Person
becomes a Restricted Subsidiary of the Company, (b) such Person is merged,
consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into,
-16-
the Company or a Restricted Subsidiary thereof or (c) such business or
assets are owned by the Company or a Restricted Subsidiary;
(iv) an Investment that is made by the Company or a Restricted
Subsidiary thereof in the form of any stock, bonds, notes, debentures,
partnership or joint venture interests or other securities that are issued
by a third party to the Issuers or a Restricted Subsidiary solely as
partial consideration for the consummation of an Asset Sale that is
otherwise permitted by Section 4.10;
(v) Investments consisting of (a) purchases and acquisitions of
inventory, supplies, materials and equipment, or (b) licenses or leases of
intellectual property and other assets in each case in the ordinary course
of business;
(vi) Investments consisting of loans and advances to employees for
reasonable travel, relocation and business expenses in the ordinary course
of business, extensions of trade credit in the ordinary course of business,
and prepaid expenses incurred in the ordinary course of business;
(vii) without duplication, Investments consisting of Indebtedness
permitted pursuant to clause (iv) of the definition of Permitted
Indebtedness;
(viii) Investments existing on the date of this Indenture;
(ix) Investments of the Company under Interest Rate Agreements;
(x) Investments under Commodity Hedge Agreements entered into in the
ordinary course of business consistent with reasonable business
requirements and not for speculation;
(xi) Investments consisting of endorsements for collection or deposit
in the ordinary course of business;
(xii) Investments consisting of the contribution by the Company
to partnerships, joint ventures or other Persons (including Subsidiaries)
of the Scheduled Titles in exchange for equity interests in such Persons,
provided that all such Investments are made within 365 days after the date
--------
hereof;
-17-
(xiii) Investments consisting of the licensing of publication titles and
other assets pursuant to joint marketing arrangements with other Persons;
and
(xiv) Investments (other than Investments specified in clauses (i)
through (xiii) above) in an aggregate amount, as valued at the time each
such Investment is made, not exceeding $5,000,000 for all such Investments
from and after the date hereof.
"Permitted Liens" means (i) Liens on property or assets of, or any
shares of stock of or secured debt of, any corporation existing at the time such
corporation becomes a Restricted Subsidiary of the Company or at the time such
corporation is merged into the Company or any of its Restricted Subsidiaries;
provided that such Liens are not incurred in connection with, or in
- --------
contemplation of, such corporation becoming a Restricted Subsidiary of the
Company or merging into the Company or any of its Restricted Subsidiaries, (ii)
Liens securing Refinancing Indebtedness; provided that any such Lien does not
--------
extend to or cover any Property, shares or debt other than the Property, shares
or debt securing the Indebtedness so refunded, refinanced or extended, (iii)
Liens in favor of the or any of their Restricted Subsidiaries, (iv) Liens
securing industrial revenue bonds, (v) Liens to secure Purchase Money
Indebtedness that is otherwise permitted under this Indenture; provided that (a)
--------
any such Lien is created solely for the purpose of securing Indebtedness
representing, or incurred to finance, refinance or refund, the cost (including
sales and excise taxes, installation and delivery charges and other direct costs
of, and other direct expenses paid or charged in connection with, such purchase
or construction) of such Property, (b) the principal amount of the Indebtedness
secured by such Lien does not exceed 100% of such costs, and (c) such Lien does
not extend to or cover any Property other than such item of Property and any
improvements on such item, (vi) statutory liens or landlords', carriers',
warehousemen's, mechanics', suppliers', materialmen's, repairmen's or other like
Liens arising in the ordinary course of business which do not secure any
Indebtedness and with respect to amounts not yet delinquent or being contested
in good faith by appropriate proceedings, if a reserve or other appropriate
provision, if any, as shall be required in conformity with GAAP shall have been
made therefor, (vii) other Liens securing obligations incurred in the ordinary
course of business which obligations do not exceed $5,000,000 in the aggregate
at any one time outstanding, (viii) any extensions, substitutions, replacements
or renewals of the foregoing, (ix) Liens for taxes, assessments or governmental
charges that are being contested in
-18-
good faith by appropriate proceedings, (x) Liens securing Capitalized Lease
Obligations permitted to be incurred under clause (v) of the definition of
"Permitted Indebtedness"; provided that such Lien does not extend to any
--------
property other than that subject to the underlying lease, (xi) Liens securing
Designated Senior Indebtedness, (xii) Liens existing on the date of this
Indenture, (xiii) Liens imposed by law, such as Liens of carriers, warehousemen,
mechanics, materialmen and landlords, and other similar Liens incurred in the
ordinary course of business for sums not constituting borrowed money that are
not overdue for a period of more than thirty (30) days or that are being
contested in good faith by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP (if so required), (xiv)
Liens incurred in the ordinary course of business in connection with worker's
compensation, unemployment insurance or other forms of government insurance or
benefits, or to secure the performance of letters of credit, bids, tenders,
statutory obligations, surety and appeal bonds, leases, government contracts and
other similar obligations (other than obligations for borrowed money) entered
into in the ordinary course of business, (xv) any attachment or judgment Lien
not constituting an Event of Default under this Indenture that is being
contested in good faith by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP (if so required), (xvi)
Liens arising from the filing, for notice purposes only, of financing statements
in respect of operating leases, (xvii) Liens arising by operation of law in
favor of depositary banks and collecting banks, incurred in the ordinary course
of business, (xviii) Liens consisting of restrictions on the transfer of
securities pursuant to applicable federal and state securities laws, (xix)
interests of lessors and licensors under leases and licenses to which the or any
of their Restricted Subsidiaries is a party, and (xx) with respect to any real
property occupied by the or any of their Restricted Subsidiaries, all easements,
rights or way, licenses and similar encumbrances on title that do not materially
impair the use of such property of its intended purposes.
"Permitted Tax Distributions" means, subject to the limitations set
forth in clause (v) of the second paragraph of Section 4.09, distributions by
the Company to Holdings and BrightView from time to time in an amount
approximately equal to the income tax liability of such member of the Company
(but in the case of Holdings and for so long as Holdings is treated as a pass-
through entity for taxation purposes, to the income tax liability that Holdings
would have if it were required to pay income taxes) resulting from the taxable
income of the Company (after taking into account all of the Company's prior tax
losses,
-19-
to the extent such losses have not previously been deemed to reduce the
taxable income of the Company and thereby reduce distributions for taxes in
accordance herewith); such distribution for taxes shall be based on the
approximate highest combined tax rate that applies to any one of the members of
the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government (including any agency or political subdivision thereof).
"Preferred Stock" means any Capital Stock of a Person, however
designated, which entitles the holder thereof to a preference with respect to
dividends, distributions or liquidation proceeds of such Person over the holders
of other Capital Stock issued by such Person.
"Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth on Exhibit A.
"Property" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in the
most recent consolidated balance sheet of such Person and its Subsidiaries under
GAAP.
"Public Equity Offering" means a public offering by BrightView of
shares of its Common Stock (however designated and whether voting or non-voting)
and any and all rights, warrants or options to acquire such Common Stock;
provided, however, that in connection with any such Public Equity Offering the
- -------- -------
net proceeds of such Public Equity Offering are contributed to the Company as
common equity.
"Purchase Money Indebtedness" means any Indebtedness incurred in the
ordinary course of business by a Person to finance the cost (including the cost
of construction) of an item of Property, the principal amount of which
Indebtedness does not exceed the sum of (i) 100% of such cost and (ii)
reasonable fees and expenses of such Person incurred in connection therewith.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A promulgated under the Securities Act.
"Qualified IPO" shall have the meaning given to such term in the
Securityholders Agreement.
-20-
"Redeemable Dividend" means, for any dividend or distribution with
regard to Disqualified Capital Stock, the quotient of the dividend or
distribution divided by the difference between one and the maximum statutory
federal income tax rate (expressed as a decimal number between 1 and 0) then
applicable to the issuer of such Disqualified Capital Stock.
"Redemption Date" when used with respect to any Note to be redeemed
means the date fixed for such redemption pursuant to the terms of the Notes.
"Refinancing Indebtedness" means Indebtedness that refunds, refinances
or extends any Indebtedness of the Company outstanding on the Issue Date or
other Indebtedness permitted to be incurred by the Company or its Restricted
Subsidiaries pursuant to the terms of this Indenture, but only to the extent
that (i) the Refinancing Indebtedness is subordinated to the Notes to at least
the same extent as the Indebtedness being refunded, refinanced or extended, if
at all, (ii) the Refinancing Indebtedness is scheduled to mature either (a) no
earlier than the Indebtedness being refunded, refinanced or extended, or (b)
after the maturity date of the Notes, (iii) the portion, if any, of the
Refinancing Indebtedness that is scheduled to mature on or prior to the maturity
date of the Notes has a weighted average life to maturity at the time such
Refinancing Indebtedness is incurred that is equal to or greater than the
weighted average life to maturity of the portion of the Indebtedness being
refunded, refinanced or extended that is scheduled to mature on or prior to the
maturity date of the Notes, (iv) such Refinancing Indebtedness is in an
aggregate principal amount that is equal to or less than the sum of (a) the
aggregate principal amount then outstanding under the Indebtedness being
refunded, refinanced or extended, (b) the amount of accrued and unpaid interest,
if any, and premiums owed, if any, not in excess of preexisting prepayment
provisions on such Indebtedness being refunded, refinanced or extended and (c)
the amount of customary fees, expenses and costs related to the incurrence of
such Refinancing Indebtedness, and (v) such Refinancing Indebtedness is incurred
by the same Person that initially incurred the Indebtedness being refunded,
refinanced or extended, except that the Company may incur Refinancing
Indebtedness to refund, refinance or extend Indebtedness of any Wholly-Owned
Subsidiary of the Company.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of November 25, 1996 among the Issuers, Holdings and First
Union Capital Markets Corp. and CIBC Wood Gundy Securities Corp., as Initial
Purchasers.
-21-
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Responsible Officer" when used with respect to the Trustee, means an
officer or assistant officer assigned to the corporate trust department of the
Trustee (or any successor group of the Trustee) or any other officer of the
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Restricted Payment" means any of the following: (i) the declaration
or payment of any dividend or any other distribution or payment on Capital Stock
of the Company or any Restricted Subsidiary of the Company or any payment made
to the direct or indirect holders (in their capacities as such) of Capital Stock
of the Company or any Restricted Subsidiary of the Company (other than (x)
dividends or distributions payable solely in Capital Stock (other than
Disqualified Capital Stock) or in options, warrants or other rights to purchase
Capital Stock (other than Disqualified Capital Stock), and (y) in the case of
Restricted Subsidiaries of the Company, dividends or distributions payable to
the Company or to a Wholly-Owned Subsidiary of the Company), (ii) the purchase,
redemption or other acquisition or retirement for value of any Capital Stock of
the Company or any of its Restricted Subsidiaries (other than Capital Stock
owned by the Company or a Wholly-Owned Subsidiary of the Company, excluding
Disqualified Capital Stock), (iii) the making of any principal payment on, or
the purchase, defeasance, repurchase, redemption or other acquisition or
retirement for value, prior to any scheduled maturity, scheduled repayment or
scheduled sinking fund payment, of any Indebtedness which is subordinated in
right of payment to the Notes other than subordinated Indebtedness acquired in
anticipation of satisfying a scheduled sinking fund obligation, principal
installment or final maturity (in each case due within one year of the date of
acquisition), (iv) the making of any Investment or guarantee of any Investment
in any Person other than a Permitted Investment, (v) any designation of a
Restricted Subsidiary as an Unrestricted Subsidiary on the basis of the
Investment by the Issuers therein and (vi) forgiveness of any Indebtedness of an
Affiliate of the Issuers (other than a Restricted Subsidiary) to the Issuers or
a Restricted Subsidiary. For purposes of determining the amount expended for
Restricted Payments, cash distributed or invested shall be valued at the face
amount thereof and property other
-22-
than cash shall be valued at its fair market value determined by the Company's
Board of Directors.
"Restricted Security" has the meaning set forth in Rule 144(a)(3)
promulgated under the Securities Act; provided that the Trustee shall be
--------
entitled to request and conclusively rely upon an Opinion of Counsel with
respect to whether any Note is a Restricted Security.
"Restricted Subsidiary" means a Subsidiary of the Company other than
an Unrestricted Subsidiary and includes all of the Subsidiaries of the Company
existing as of the Issue Date. The Board of Directors of the Company may
designate any Unrestricted Subsidiary or any Person that is to become a
Subsidiary as a Restricted Subsidiary if immediately after giving effect to such
action (and treating any Acquired Indebtedness as having been incurred at the
time of such action), the Issuers could have incurred at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) pursuant to Section
4.06.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Sale and Lease-Back Transaction" means any arrangement with any
Person providing for the leasing by the Company or any Restricted Subsidiary of
the Company of any real or tangible personal Property, which Property has been
or is to be sold or transferred by the Company or such Restricted Subsidiary to
such Person in contemplation of such leasing.
"S&P" means Standard & Poor's Corporation and its successors.
"Scheduled Titles" shall refer to the following publications: Sassy,
-----
Sport, Petersen's Golfing, Mountain Biker, Bicycle Guide, Custom Classic Trucks,
- ----- ------------------ -------------- ------------- ---------------------
Pro Basketball, Pro Baseball, Pro Football, Pro Hockey, College Basketball,
- -------------- ------------ ------------ ---------- ------------------
College Football, Super Street, VW Custom & Classic, Event Scene, Hot Rod Bikes,
- ---------------- ------------ ------------------- ----------- -------------
4x4 Power and Family Photo.
- --------- ------------
"SEC" means the United States Securities and Exchange Commission as
constituted from time to time or any successor performing substantially the same
functions.
"Securities Act" means the Securities Act of 1933, as amended.
-23-
"Securities Purchase Agreement" means the Securities Purchase
Agreement, dated as of September 30, 1996, among Holdings, Petersen Investment
Corp., BrightView, Petersen, Willis Stein and the Purchasers named therein.
"Securityholders Agreement" means the Securityholders Agreement, dated
as of September 30, 1996, among Holdings, Petersen Investment Corp., BrightView
and the Investors named therein.
"Senior Credit Facility" means the Credit Agreement, dated as of
September 30, 1996, among the Company, the lenders listed therein and First
Union National Bank of North Carolina, as administrative agent, and Canadian
Imperial Bank of Commerce, as documentation agent, together with the documents
related 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 adding Subsidiaries of the 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.
"Senior Indebtedness" means the principal of and premium, if any, and
interest (including, without limitation, interest accruing or that would have
accrued but for the filing of a bankruptcy, reorganization or other insolvency
proceeding whether or not such interest constitutes an allowable claim in such
proceeding) on, and any and all other fees, expense reimbursement obligations,
indemnities and other amounts due pursuant to the terms of all agreements,
documents and instruments providing for, creating, securing or evidencing or
otherwise entered into in connection with (a) all Indebtedness of the Company
owed to lenders under the Senior Credit Facility, (b) all obligations of the
Company with respect to any Interest Rate Agreement, (c) all obligations of the
Company to reimburse any bank or other Person in respect of amounts paid under
letters of credit, acceptances or other similar instruments, (d) all other
Indebtedness of the Company which does not provide that it is to rank pari passu
---- -----
with or subordinate to the Notes and (e) all deferrals, renewals, extensions and
refundings of, and amendments, modifications and supplements to, any of the
Senior Indebtedness described above. Notwithstanding anything to the contrary
in the foregoing, Senior Indebtedness will not include (i) Indebtedness of the
Company to any of its Subsidiaries,
-24-
(ii) Indebtedness represented by the Notes, (iii) any Indebtedness which by the
express terms of the agreement or instrument creating, evidencing or governing
the same is junior or subordinate in right of payment to any item of Senior
Indebtedness, (iv) any trade payable arising from the purchase of goods or
materials or for services obtained in the ordinary course of business or (v)
Indebtedness incurred in violation of this Indenture, except if such
Indebtedness was incurred under the Senior Credit Facility based on financial
information and certificates provided by responsible officers of the Company and
relied on in good faith by the lenders thereunder, in which event such
Indebtedness shall be deemed to have been incurred in compliance with this
Indenture and constitute Senior Indebtedness.
"Subsidiary" of any specified Person means any corporation,
partnership, joint venture, association or other business entity, whether now
existing or hereafter organized or acquired, (i) in the case of a corporation,
of which more than 50% of the total voting power of the Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, officers or trustees thereof is held by such first-named Person or
any of its Subsidiaries; or (ii) in the case of a partnership, joint venture,
association or other business entity, with respect to which such first-named
Person or any of its Subsidiaries has the power to direct or cause the direction
of the management and policies of such entity by contract or otherwise or if in
accordance with GAAP such entity is consolidated with the first-named Person for
financial statement purposes.
"Temporary Cash Investments" means (i) Investments in marketable
direct obligations issued or guaranteed by the United States of America, or of
any governmental agency or political subdivision thereof, maturing within 365
days of the date of purchase; (ii) Investments in certificates of deposit issued
by a bank organized under the laws of the United States of America or any state
thereof or the District of Columbia, in each case having capital, surplus and
undivided profits at the time of investment totaling more than $500,000,000 and
rated at the time of investment at least A by S&P and A-2 by Moody's maturing
within 365 days of purchase; or (iii) Investments not exceeding 365 days in
duration in money market funds that invest substantially all of such funds'
assets in the Investments described in the preceding clauses (i) and (ii).
-25-
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)
77aaa-77bbbb) as in effect on the date of this Indenture (except as provided in
Section 8.03 hereof).
"Trustee" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Unrestricted Subsidiary" means (a) any Subsidiary of an Unrestricted
Subsidiary and (b) any Subsidiary of the Company which is classified after the
Issue Date as an Unrestricted Subsidiary by a resolution adopted by the Board of
Directors of the Company; provided that a Subsidiary organized or acquired after
--------
the Issue Date may be so classified as an Unrestricted Subsidiary only if such
classification is in compliance with the covenant set forth in Section 4.09
hereof. The Trustee shall be given prompt notice by the Company of each
resolution adopted by the Board of Directors of the Company under this
provision, together with a copy of each such resolution adopted.
"U.S. Government Obligations" means (a) securities that are direct
obligations of the United States of America for the payment of which its full
faith and credit are pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such depository receipt; provided that (except as required by law) such
--------
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or a specific payment of principal or
interest on any such U.S. Government Obligation held by such custodian for the
account of the holder of such depository receipt.
"Wholly-Owned Subsidiary" means any Restricted Subsidiary, all of the
outstanding voting securities (other than directors' qualifying shares) of which
are owned, directly or indirectly, by the Company.
-26-
"Willis Stein" means Willis Stein & Partners, L.P., a Delaware limited
partnership.
Section 1.02. Other Definitions.
-----------------
The definitions of the following terms may be found in the sections
indicated as follows:
Term Defined in Section
---- ------------------
"Affiliate Transaction".................. 4.11
"Agent Members".......................... 2.14
"Bankruptcy Law"......................... 6.01
"Business Day"........................... 12.08
"Change of Control Offer"................ 4.19
"Change of Control Payment Date"......... 4.19
"Covenant Defeasance".................... 9.03
"Custodian".............................. 6.01
"Event of Default"....................... 6.01
"Excess Proceeds Offer".................. 4.10
"Global Notes"........................... 2.01
"Guarantee Payment Blockage Period"...... 10.08
"Guarantor Representative................ 10.08
"Initial Blockage Period"................ 11.03
"Initial Guarantee Blockage Period"...... 10.08
"Legal Defeasance"....................... 9.02
"Legal Holiday".......................... 12.08
"Offer Period"........................... 4.10
"Offshore Physical Notes"................ 2.01
"Paying Agent"........................... 2.03
"Payment Blockage Period"................ 11.03
"Physical Notes"......................... 2.01
"Purchase Date".......................... 4.10
"Registrar".............................. 2.03
"Reinvestment Date"...................... 4.10
"Representative"......................... 11.03
"U.S. Physical Notes".................... 2.01
Section 1.03. Incorporation by Reference of Trust
Indenture Act.
-----------------------------------
Whenever this Indenture refers to a provision of the TIA, the portion
of such provision required to be incorporated herein in order for this Indenture
to be qualified under the TIA is incorporated by reference in and made a part of
this Indenture. The following TIA terms used in this Indenture have the
following meanings:
-27-
"Commission" means the SEC.
"indenture securities" means the Notes.
"indenture securityholder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor on the indenture securities" means the , the Guarantors or
any other obligor on the Notes.
All other terms used in this Indenture that are defined by the TIA,
defined in the TIA by reference to another statute or defined by SEC rule have
the meanings therein assigned to them.
Section 1.04. Rules of Construction.
---------------------
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein, whether defined
expressly or by reference;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) words used herein implying any gender shall apply to every
gender; and
(6) whenever in this Indenture there is mentioned, in any context,
Principal, interest or any other amount payable under or with respect to
any Note, such mention shall be deemed to include mention of the payment of
Additional Interest to the extent that, in such context, Additional
Interest is, was or would be payable in respect thereof.
-28-
ARTICLE 2
THE NOTES
Section 2.01. Dating; Incorporation of Form in Indenture.
------------------------------------------
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A which is incorporated in and made part of
this Indenture. The Notes may have notations, legends or endorsements required
by law, stock exchange rule or usage. The Issuers may use "CUSIP" numbers in
issuing the Notes. The Issuers shall approve the form of the Notes by Board
Resolution. Each Note shall be dated the date of its authentication.
The Notes are being offered and sold to Qualified Institutional Buyers
(as defined) in reliance on Rule 144A ("Rule 144A Notes"). Notes also may be
offered and sold to Institutional Accredited Investors (as defined) in
transactions exempt from registration under the Securities Act not made in
reliance on Rule 144A or Regulation S ("Other Notes") or in offshore
transactions in reliance on Regulation S ("Regulation S Notes").
Rule 144A Notes and Other Notes which may be held in global form,
other than Regulation S Notes initially will be represented by one or more Notes
in registered, global form without interest coupons (collectively, the
"Restricted Global Note"). The Restricted Global Note will be deposited upon
issuance with the Trustee as custodian for The Depository Trust Company ("DTC"),
in New York, New York, and registered in the name of DTC or its nominee, in each
case for credit to an account of a direct or indirect participant as described
below. Regulation S Notes initially will be represented by one or more global
notes in registered, global form without interest coupons (collectively, the
"Regulation S Global Note", and, together with the Restricted Global Note, the
"Global Notes"). Notes sold to Accredited Investors may be represented by the
Restricted Global Note or, if such an investor may not hold an interest in the
Restricted Global Note, a certificated Note bearing the restrictive legend
described under Exhibit A. The Regulation S Global Note will be registered in
the name of DTC or its nominee and deposited with the Trustee as custodian for
DTC. The Regulation S Global Note will be registered in the name of a nominee of
DTC for credit to the accounts of Euroclear System ("Euroclear") and Cedel Bank,
S.A. ("CEDEL"). On or prior to the 40th-day after the later of the commencement
of the offering and the original issue date
-29-
(such period through and including such 40th day, the "Restricted Period")
beneficial interests in the Regulation S Note may be held only through Euroclear
or CEDEL, as indirect participants in DTC, unless transferred to a person that
takes delivery in the form of an interest in the corresponding Restricted Global
Note in accordance with the certification requirements described below.
Beneficial interests in the Restricted Global Note may not be exchanged for
beneficial interests in the Regulation S Global Note at any time except in the
limited circumstances described below. See Section 2.01C.
Except as set forth below, the Global Notes may be transferred, in
whole and not in part, only to another nominee of DTC or to a successor of DTC
or its nominee. Beneficial interests in the Global Notes may not be exchanged
for Notes in certificated form except in the limited circumstances described
below. See Section 2.01B.
Rule 144A Notes and Other Notes (including beneficial interests in the
Restricted Global Note) will be subject to certain restrictions on transfer and
will bear a restrictive legend as described under Exhibit A. In addition,
transfer of beneficial interests in the Global Notes will be subject to the
applicable rules and procedures of DTC and its direct or indirect participants
(including, if applicable, those of Euroclear and CEDEL), which may change from
time to time.
The Notes may be presented for registration of transfer and exchange
at the offices of the Registrar.
Section 2.02.A Depository Procedures
---------------------
DTC has advised the Company that DTC is a limited-purpose trust
company created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the clearance and
settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants. The Participants
include securities brokers and dealers (including the Initial Purchaser), banks,
trust companies, clearing corporations and certain other organizations. Access
to DTC's system is also available to other entities such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly (collectively,
the "Indirect Participants"). Persons who are not Participants may beneficially
own securities held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interest and transfer of ownership
-30-
interest of each actual purchaser of each security held by or on behalf of DTC
are recorded on the records of the Participants and Indirect Participants.
DTC has also advised the Company that pursuant to procedures
established by it, (i) upon deposit of the Global Notes, DTC will credit the
accounts of Participants designated by the Initial Purchaser with portions of
the principal amount of the Global Notes and (ii) ownership of such interests in
the Global Notes will be shown on, and the transfer of ownership thereof will be
effected only through, records maintained by DTC (with respect to the
Participants) or by the Participants and the Indirect Participants (with respect
to other owners of beneficial interests in the Global Notes).
Investors in the Restricted Global Note may hold their interests
therein directly through DTC, if they are Participants in such system, or
indirectly through organizations (including Euroclear and CEDEL) which are
Participants in such system. Investors in the Regulation S Global Note must
initially hold their interests therein through Euroclear or CEDEL, if they are
accountholders in such systems, or indirectly through organizations which are
accountholders in such systems. After the expiration of the Restricted Period
(but not earlier), investors may also hold interests in the Regulation S Global
Note through organizations other than Euroclear and CEDEL that are Participants
in the DTC system. Euroclear and CEDEL will hold interests in the Regulation S
Global Note on behalf of their accountholders through their respective
depositors, which in turn will hold such interests in the Regulation S Global
Note customers' securities accounts in their respective names on the books of
DTC. The Chase Manhattan Bank, Brussels office, will initially act as depository
for Euroclear, and Citibank, N.A., will initially act as depository for CEDEL.
All interests in a Global Note, including those held through Euroclear or CEDEL,
may be subject to the procedures and requirements of DTC. Those interests held
through Euroclear or CEDEL may also be subject to the procedures and
requirements of such system.
The laws of some states require that certain persons take physical
delivery in definitive form of securities that they own. Consequently, the
ability to transfer beneficial interests in a Global Note to such persons may be
limited to that extent. Because DTC can act only on behalf of Participants,
which in turn act on behalf of Indirect Participants and certain banks, the
ability of a person having beneficial interests in a Global Note to pledge such
interests to persons or entities that do not participate in the DTC system, or
otherwise take actions in
-31-
respect of such interests, may be affected by the lack of a physical certificate
evidencing such interests. For certain other restrictions on the transferability
of the Notes, see Section 2.01B.
Except as described below, owners of interests in the Global Notes
will not have Notes registered in their names, will not receive physical
delivery of Notes in certificated form and will not be considered the registered
owners or holders thereof under the Indenture for any purpose.
Payments in respect of the principal of (and premium, if any) and
interest on a Global Note registered in the name of DTC or its nominee will be
payable to DTC or its nominee in its capacity as the registered holder under the
Indenture. Under the terms of the Indenture, the Company and the Trustee will
treat the persons in whose names the Notes, including the Global Notes, are
registered as the owners thereof for the purpose of receiving such payments and
for any and all other purposes whatsoever. Consequently, neither the Company,
the Trustee nor any agent of the Company or the Trustee has or will have any
responsibility or liability for (i) any aspect or accuracy of DTC's records or
any Participant's or Indirect Participant's records relating to or payments made
on account of beneficial ownership interests in the Global Notes, or for
maintaining, supervising or reviewing any of DTC's records or any Participant's
or Indirect Participant's records relating to the beneficial ownership interests
in the Global Notes, or (ii) any other matter relating to the actions and
practices of DTC or any of its Participants or Indirect Participants.
DTC has advised the Company that its current practice, upon receipt of
any payment in respect of securities such as the Notes (including principal and
interest), is to credit the accounts of the relevant Participants with the
payment on the payment date, in amounts proportionate to their respective
holdings in principal amount of beneficial interests in the relevant security
such as the Global Notes as shown on the records of DTC. Payments by the
Participants and the Indirect Participants to the beneficial owners of Notes
will be governed by standing instructions and customary practices and will not
be the responsibility of DTC, the Trustee or the Company. Neither the Company
nor the Trustee will be liable for any delay by DTC or any of its Participants
in identifying the beneficial owners of the Notes, and the Company and the
Trustee may conclusively rely on and will be protected in relying on
instructions from DTC or its nominee as the registered owner of the Notes for
all purposes.
-32-
Except for trades involving only Euroclear and CEDEL participants,
interests in the Global Notes will trade in DTC's Same-Day Funds Settlement
System and secondary market trading activity in such interests will therefore
settle in immediately available funds, subject in all cases to the rules and
procedures of DTC and its participants.
Transfers between Participants in DTC will be effected in accordance
with DTC's procedures, and will be settled in same-day funds. Transfers between
accountholders in Euroclear and CEDEL will be effected in the ordinary way in
accordance with their respective rules and operating procedures.
Subject to compliance with the transfer restrictions applicable to the
Notes described herein, cross-market transfers between the accountholders in
DTC, on the one hand, and directly or indirectly through Euroclear or CEDEL
accountholders, on the other hand, will be effected through DTC in accordance
with DTC's rules on behalf of Euroclear or CEDEL, as the case may be, by its
respective depositary; however, such cross-market transactions will require
delivery of instructions to Euroclear or CEDEL, as the case may be, by the
counterparty in such system in accordance with the rules and procedures and
within the established deadlines (Brussels time) of such system. Euroclear or
CEDEL, as the case may be, will, if the transaction meets its settlement
requirements, deliver instructions to its respective depositary to take action
to effect final settlement on its behalf by delivering or receiving interests in
the relevant Global Note in DTC, and making or receiving payment in accordance
with normal procedures for same-day fund settlement applicable to DTC. Euroclear
accountholders and CEDEL accountholders may not deliver instructions directly to
the depositories for Euroclear or CEDEL.
Because of time zone differences, the securities account of a
Euroclear or CEDEL accountholders purchasing an interest in a Global Note from a
accountholders in DTC will be credited, and any such crediting will be reported
to the relevant Euroclear or CEDEL participant, during the securities settlement
processing day (which must be a business day for Euroclear or CEDEL) immediately
following the settlement date of DTC. Cash received in Euroclear or CEDEL as a
result of sales of interests in a Global Note by or through a Euroclear or CEDEL
accountholders to a Participant in DTC will be received with value on the
settlement date of DTC but will be available in the relevant Euroclear or CEDEL
cash account only as of the business day for Euroclear or CEDEL following DTC's
settlement date.
-33-
DTC has advised the Company that it will take any action permitted to be
taken by a holder of Notes only at the direction of one or more Participants to
whose account with DTC interests in the Global Notes are credited and only in
respect of such portion of the aggregate principal amount of the Notes as to
which such Participant or Participants has or have given such direction.
However, if any of the events described under occurs DTC reserves the right to
exchange the Global Notes for (in the case of the Restricted Global Note)
legended Notes in certificated form, and to distribute such Notes to its
Participants.
The information in this section concerning DTC, Euroclear and CEDEL and
their book-entry systems has been obtained from sources that the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
Although DTC, Euroclear and CEDEL have agreed to the foregoing procedures
to facilitate transfers of interests in the Regulation S Global Note and in the
Restricted Global Note among accountholders in DTC, and accountholders of
Euroclear and CEDEL, they are under no obligation to perform or to continue to
perform such procedures, and such procedures may be discontinued at any time.
None of the Company, the Initial Purchasers or the Trustee nor any agent of the
Company or Trustee will have any responsibility for the performance by DTC,
Euroclear or CEDEL or their respective accountholders, indirect participants or
accountholders of their respective obligations under the rules and procedures
governing their operations.
Section 2.01B Exchange of Book-Entry Notes for Certificated Notes
---------------------------------------------------
A Global Note is exchangeable for definitive Notes in registered
certificated form if (i) DTC (x) notifies the Company that it is unwilling or
unable to continue as depositary for the Global Note and the Company thereupon
fails to appoint a successor depositary or (y) has ceased to be a clearing
agency registered under the Exchange Act, (ii) the Company, at its option,
notifies the Trustee in writing that it elects to cause the issuance of the
Notes in certificated form or (iii) there shall have occurred and be continuing
a Default or an Event of Default with respect to the Notes. In all cases,
certificated Notes delivered in exchange for any Global Note or beneficial
interests therein will be registered in the names, and issued in any approved
denominations, requested by or on behalf of the depositary (in accordance with
its customary procedures) and will bear, in the case of the Restricted Global
Note, the restrictive
-34-
legend referred to in Exhibit A and, in the case of the Regulation S Global
Note, the legend set forth in bold type on the cover of this Offering
Memorandum, in each case, unless the Company determines otherwise in compliance
with applicable law.
Section 2.01C Exchanges between Regulation S Notes and Rule 144A Notes and
-------------------------------------------------- ---------
Other Notes
-----------
Prior to the expiration of the Restricted Period, a beneficial interest in
a Regulation S Global Note may be transferred to a person who takes delivery in
the form of an interest in the corresponding Restricted Global Note only upon
receipt by the Trustee of a written certification from the transferor to the
effect that such transfer is being made (i)(a) to a person whom the transferor
reasonably believes is a Qualified Institutional Buyer in a transaction meeting
the requirements of Rule 144A or (b) pursuant to another exemption from the
registration requirements under the Securities Act which is accompanied by an
opinion of counsel regarding the availability of such exemption and (ii) in
accordance with all applicable securities laws of any state of the United States
or any other jurisdiction.
Beneficial interests in the Restricted Global Note may be transferred to a
person who takes delivery in the form of an interest in the Regulation S Global
Note, whether before or after the expiration of the Restricted Period, only if
the transferor first delivers to the Trustee a written certificate to the effect
that such transfer is being made in accordance with Rule 903 or 904 of
Regulation S or Rule 144 (if available) and that, if such transfer occurs prior
to the expiration of the Restricted Period, the interest transferred will be
held immediately thereafter through Euroclear or CEDEL.
Any beneficial interest in one of the Global Notes that is transferred to a
person who takes delivery in the form of an interest in another Global Note
will, upon transfer, cease to be an interest in such Global Note and become an
interest in such other Global Note and, accordingly, will thereafter be subject
to all transfer restrictions and other procedures applicable to beneficial
interests in such other Global Note for as long as it remains such an interest.
Transfers involving an exchange of a beneficial interest in the Regulation
S Global Note for a beneficial interest in the Restricted Global Note or vice
versa will be effected in DTC by means of an instruction originated by DTC
through the DTC/Deposit Withdraw at Custodian ("DWAC") system. Accordingly, in
-35-
connection with such transfer, upon notice from DTC through the DWAC system
appropriate adjustments, this is initiated by beneficial holder through
participant through DTC to Trustee, will be made to reflect a decrease in the
principal amount of the Regulation S Global Note and a corresponding increase in
the principal amount of the Restricted Global Note or vice versa, as applicable.
Section 2.03. Execution and Authentication.
----------------------------
The Notes shall be executed on behalf of each Issuer by two Officers
of such Issuer or an Officer and an Assistant Secretary of such Issuer. Such
signature may be either manual or facsimile. The Issuers' seals shall be
impressed, affixed, imprinted or reproduced on the Notes and may be in facsimile
form.
If an Officer whose signature is on a Note no longer holds that office
at the time the Trustee authenticates the Note, the Note shall be valid
nevertheless.
A Note shall not be valid until the Trustee manually signs the
certificate of authentication on the Note. Such signature shall be conclusive
evidence that the Note has been authenticated under this Indenture.
The Trustee or an authenticating agent shall authenticate Notes for
original issue in the aggregate principal amount of $100,000,000 upon an Issuer
Request. The aggregate principal amount of Notes outstanding at any time may
not exceed such amount except as provided in Section 2.07 hereof. Upon receipt
of the Issuer Request and an Officers' Certificate certifying that the
registration statement relating to the exchange offer specified in the
Registration Rights Agreement is effective under the Securities Act and that the
conditions precedent to an exchange thereunder have been met; the Trustee shall
authenticate an additional series of Notes in an aggregate principal amount not
to exceed $100,000,000 for issuance in exchange for all Notes tendered for
exchange pursuant to an exchange offer registered under the Securities Act or
pursuant to a Private Exchange (as defined in the Registration Rights
Agreement). Exchange Notes (as defined in the Registration Rights Agreement) or
Private Exchange Notes (as defined in the Registration Rights Agreement) may
have such distinctive series designation as and such changes in the form thereof
as are specified in the Issuer Request referred to in the preceding sentence.
The Notes shall be issuable only in registered form
-36-
without coupons and only in denominations of $1,000 and integral multiples
thereof.
The Trustee (at the expense of the Issuers) may appoint an
authenticating agent to authenticate Notes. An authenticating agent may
authenticate Notes 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 right as an Agent to deal with the
Issuers or an Affiliate.
Section 2.04. Registrar and Paying Agent.
--------------------------
The Issuers shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar"), an office
or agency located in the Borough of Manhattan, City of New York, State of New
York where Notes may be presented for payment ("Paying Agent") and an office or
agency where notices and demands to or upon the Issuers in respect of the Notes
and this Indenture may be served. The Registrar shall keep a register of the
Notes and of their transfer and exchange. The Issuers may have one or more
additional Paying Agents. Neither the Issuers nor any Affiliate may act as
Paying Agent. The Issuers may change any Paying Agent or Registrar without
notice to any Noteholder.
The Issuers shall enter into an appropriate agency agreement with any
Registrar or Paying Agent not a party to this Indenture. The agreement shall
implement the provisions of this Indenture that relate to such Agent and shall
incorporate the provisions of the TIA. The Issuers shall notify the Trustee of
the name and address of any such Agent. If the Issuers fail to maintain a
Registrar or Paying Agent, or agent for service of notices and demands, or fail
to give the foregoing notice, the Trustee shall act as such. The Issuers
initially appoint the Trustee as Registrar, Paying Agent and agent for service
of notices and demands in connection with the Notes.
Section 2.05. Paying Agent to Hold Money in Trust.
-----------------------------------
On or before 10:00 a.m. New York City time on each due date of the
principal of and interest on any Notes, the Issuers shall deposit with the
Paying Agent a sum sufficient to pay such principal and interest so becoming
due. The Issuers at any time may require a Paying Agent to pay all money held
by it to the Trustee and the Trustee, may at any time during the continuance of
any Payment Default, upon written request to a Paying Agent, require such Paying
Agent to forthwith pay to the Trustee all
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sums so held in trust by such Paying Agent together with a complete accounting
of such sums. Upon doing so, the Paying Agent shall have no further liability
for the money.
Section 2.06. Noteholder 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
Noteholders. If the Trustee is not the Registrar, the Issuers shall furnish to
the Trustee at least five Business Days before each Interest Payment Date, and
at such other times as the Trustee may request in writing, a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of Noteholders.
Section 2.07. Transfer and Exchange.
---------------------
Subject to Section 2.15, when a Note is presented to the Registrar
with a request to register the transfer thereof, the Registrar shall register
the transfer as requested and, when Notes are presented to the Registrar with a
request to exchange them for an equal principal amount of Notes of other
authorized denominations, the Registrar shall make the exchange as requested
provided that every Note presented or surrendered for registration of transfer
or exchange shall be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Issuers and the Registrar duly executed by
the Holder thereof or his attorney duly authorized in writing. To permit
transfers and exchanges, upon surrender of any Note for registration of transfer
at the office or agency maintained pursuant to Section 2.03 hereof, the Issuers
shall execute and the Trustee shall authenticate Notes at the Registrar's
request. Any exchange or transfer shall be without charge, except that the
Issuers may require payment by the Holder of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation to a transfer or
exchange, but this provision shall not apply to any exchange pursuant to
Sections 2.09, 3.06 or 8.05 hereof. The Trustee shall not be required to
register transfers of Notes or to exchange Notes for a period of 15 days before
the mailing of notice of redemption of Notes to be redeemed. The Trustee shall
not be required to exchange or register transfers of any Notes called or being
called for redemption in whole or in part, except the unredeemed portion of any
Note being redeemed in part.
Any Holder of the Global Note shall, by acceptance of such Global
Note, agrees that transfers of the beneficial interests in such Global Note may
be effected only through a book
-38-
entry system maintained by the Holder of such Global Note (or its agent), and
that ownership of a beneficial interest in the Global Note shall be required to
be reflected in a book entry.
Each Holder of a Note agrees to indemnify the Issuers and the Trustee
against any liability that may result from the transfer, exchange or assignment
of such Holder's Note in violation of any provision of this Indenture and/or
applicable U.S. Federal or state securities law.
Except as expressly provided herein, neither the Trustee nor the
Registrar shall have any duty to monitor the Issuers' or any Guarantor's
compliance with or have any responsibility with respect to the Issuers' or any
Guarantor's compliance with any U.S. Federal or state securities laws.
Section 2.08. Replacement Notes.
-----------------
If a mutilated Note is surrendered to the Registrar or the Trustee or
if the Holder of a Note presents evidence to the satisfaction of the Issuers and
the Trustee that the Note has been lost, destroyed or wrongfully taken, the
Issuers shall issue, the Guarantors shall endorse and the Trustee shall
authenticate a replacement Note if the requirements of Section 8-405 of the New
York Uniform Commercial Code as in effect on the date of this Indenture are met.
An indemnity bond may be required by the Issuers or the Trustee that is
sufficient in the judgment of the Issuers and the Trustee to protect the
Issuers, the Trustee or any Agent from any loss which any of them may suffer if
a Note is replaced. In every case of destruction, loss or theft, the applicant
shall also furnish to the Issuers and to the Trustee evidence to their
satisfaction of the destruction, loss or the theft of such Note and the
ownership thereof. The Issuers may charge the Holder for their exceptional out-
of-pocket expenses in replacing a Note and the Trustee may charge the Company
for the Trustee's expenses (including, without limitation, attorneys' fees and
disbursements). Every replacement Note is an additional obligation of the
Issuers.
Section 2.09. Outstanding Notes.
-----------------
Notes outstanding at any time are all Notes authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation, and those described in this Section 2.08 as not outstanding and,
to the extent set forth in Sections 9.01 and 9.02, on or after the date on which
the conditions set forth in Sections 9.01 or 9.02 have been
-39-
satisfied, those Notes theretofore authenticated and delivered by the Trustee
hereunder.
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding until the Issuers and the Trustee receive proof satisfactory to each
of them that the replaced Note is held by a bona fide purchaser.
If a Paying Agent holds on a Redemption Date or Maturity Date money
sufficient to pay the principal of, premium, if any, and accrued interest on
Notes payable on that date, then on and after that date such Notes cease to be
outstanding and interest on them ceases to accrue.
Subject to Section 12.06, a Note does not cease to be outstanding
solely because the Issuers or an Affiliate holds the Note.
Section 2.010. Temporary Notes.
---------------
Until definitive Notes are ready for delivery, the Issuers may prepare
and the Trustee shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form, and shall carry all rights, of definitive Notes but
may have variations that the Issuers consider appropriate for temporary Notes.
Without unreasonable delay, the Issuers shall prepare and the Trustee shall
authenticate definitive Notes in exchange for temporary Notes presented to it.
Until such exchange, temporary Notes shall be entitled to the same rights,
benefits and privileges as definitive Notes.
Section 2.10. Cancellation.
------------
The Issuers at any time may deliver Notes to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Notes surrendered to them for transfer, exchange or payment. The Trustee
shall cancel and destroy all Notes surrendered for transfer, exchange, payment
or cancellation and deliver a certificate of destruction to the Issuers.
Subject to Section 2.07 hereof, the Issuers may not issue new Notes to replace
Notes in respect of which they have previously paid all principal, premium and
interest accrued thereon, or delivered to the Trustee for cancellation.
-40-
Section 2.11. Defaulted Interest.
------------------
If the Issuers default in a payment of interest on the Notes, they
shall pay the defaulted amounts, plus any interest payable on defaulted amounts
pursuant to Section 4.01 hereof, to the persons who are Noteholders on a
subsequent special record date. The Issuers shall fix the special record date
and payment date in a manner satisfactory to the Trustee and provide the Trustee
at least 20 days notice of the proposed amount of default interest to be paid,
the special record date and the special payment date. At least 15 days before
the special record date, the Issuers shall mail or cause to be mailed to each
Noteholder at his address as it appears on the Notes register maintained by the
Registrar a notice that states the special record date, the payment date (which
shall be not less than five nor more than ten days after the special record
date), and the amount to be paid. The Company may make payment of any defaulted
interest in any other lawful manner not inconsistent with the requirements (if
applicable) of any securities exchange on which the Notes may be listed and,
upon such notice as may be required by such exchange, if, after written notice
given by the Company to the Trustee of the proposed payment pursuant to this
sentence, such manner of payment shall be deemed practicable by the Trustee.
Section 2.12. Deposit of Moneys.
-----------------
Prior to 10:00 a.m., New York City time, on each Interest Payment Date
and Maturity Date, the Issuers shall have deposited with the Paying Agent in
immediately available funds money sufficient to make cash payments, if any, due
on such Interest Payment Date or Maturity Date, as the case may be, in a timely
manner which permits the Trustee to remit payment to the Holders on such
Interest Payment Date or Maturity Date, as the case may be. The principal and
interest on Global Notes shall be payable to the Depository or its nominee, as
the case may be, as the sole registered owner and the sole holder of the Global
Notes represented thereby. The principal and interest on Physical Notes shall
be payable at the office of the Paying Agent.
Section 2.13. CUSIP Number.
------------
The Issuers in issuing the Notes may use a "CUSIP" number(s), and if
so, the Trustee shall use the CUSIP number(s) in notices of redemption or
exchange as a convenience to Holders, provided that any such notice may state
--------
that no representation is made as to the correctness or accuracy of the CUSIP
number(s) printed in the notice or on the Notes, and that reliance may be
-41-
placed only on the other identification numbers printed on the Notes.
Section 2.14. Book-Entry Provisions for Global Notes.
--------------------------------------
(a) The Global Notes 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
Exhibit B.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depository, or the Trustee as its custodian, or under the
Global Note, and the Depository may be treated by the Issuers, the Trustee and
any agent of the Issuers or the Trustee as the absolute owner of the Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Issuers, the Trustee or any agent of the Issuers 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 Note.
(b) Transfers of Global Notes shall be limited to transfer in whole,
but not in part, to the Depository, its successors or their respective nominees.
Interests of beneficial owners in the Global Notes may be transferred or
exchanged for Physical Notes in accordance with the rules and procedures of the
Depository and the provisions of Section 2.15. In addition, Physical Notes
shall be transferred to all beneficial owners in exchange for their beneficial
interests in Global Notes if (i) the Depository notifies the Issuers that it is
unwilling or unable to continue as Depository for any Global Note and a
successor depositary is not appointed by the Issuers 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 to issue Physical
Notes.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Note to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Physical Notes are to be
issued) reflect on its books and records the date and a decrease in the
principal amount of the Global Note in an amount equal to the principal amount
of the beneficial interest in the Global Note to be transferred, and the Issuers
shall execute, and the Trustee shall upon receipt of
-42-
an Issuer Order authenticate and make available for delivery, one or more
Physical Notes of like tenor and amount.
(d) In connection with the transfer of Global Notes as an entirety to
beneficial owners pursuant to paragraph (b), the Global Notes shall be deemed to
be surrendered to the Trustee for cancellation, and the Issuers shall execute,
and the Trustee shall authenticate and deliver, to each beneficial owner
identified by the Depository in writing in exchange for its beneficial interest
in the Global Notes, an equal aggregate principal amount of Physical Notes of
authorized denominations.
(e) Any Physical Note constituting a Restricted Security delivered in
exchange for an interest in a Global Note pursuant to paragraph (b), (c) or (d)
shall, except as otherwise provided by paragraphs (a)(i)(x) and (c) of Section
2.15, bear the legend regarding transfer restrictions applicable to the Physical
Notes set forth in Exhibit A.
(f) The Holder of any Global Note 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, the Notes or the Guarantees.
Section 2.15. Special Transfer Provisions.
---------------------------
(a) Transfers to Non-QIB Institutional Accredited Investors and Non-
---------------------------------------------------------------
U.S. Persons. The following provisions shall apply with respect to the
- ------------
registration of any proposed transfer of a Note constituting a Restricted
Security to any Institutional Accredited Investor which is not a QIB or to any
Non-U.S. Person:
(i) the Registrar shall register the transfer of any Note constituting
a Restricted Security, whether or not such Note bears the Private Placement
Legend, if (x) the requested transfer is after November , 1999 or (y) (1)
in the case of a transfer to an Institutional Accredited Investor which is
not a QIB (excluding Non-U.S. Persons), the proposed transferee has
delivered to the Registrar a certificate substantially in the form of
Exhibit C hereto or (2) in the case of a transfer to a Non-U.S. Person
(including a QIB), the proposed transferor has delivered to the Registrar a
certificate substantially in the form of Exhibit D hereto, provided, that
--------
in the case of a transfer of a Note bearing the Private Placement Legend
for a Note not bearing the Private Placement Legend, the Registrar has
-43-
received an Officers' Certificate authorizing such transfer; and
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in a Global Note, 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 Physical Notes) a
decrease in the principal amount of a Global Note in an amount equal to the
principal amount of the beneficial interest in a Global Note to be transferred,
and (b) the Issuers shall execute, the Guarantors shall endorse and the Trustee
shall authenticate and make available for delivery one or more Physical Notes 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 Note constituting a
Restricted Security to a QIB (excluding transfers to Non-U.S. Persons):
(i) 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 Note stating, or has otherwise advised the Issuers 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 Note stating, or has otherwise advised the
Issuers and the Registrar in writing, that it is purchasing the Note 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 Issuers 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; and
(ii) if the proposed transferee is an Agent Member, and the Securities
to be transferred consist of Physical Notes which after transfer are to be
evidenced by an interest in the Global Note, upon receipt by the Registrar
of instructions given in accordance with the Depository's and
-44-
the Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Global Note
in an amount equal to the principal amount of the Physical Notes to be
transferred, and the Trustee shall cancel the Physical Notes so
transferred.
(c) Private Placement Legend. Upon the transfer, exchange or
------------------------
replacement of Notes not bearing the Private Placement Legend, the Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement Legend
unless (i) it has received the Officers' Certificate required by paragraph
(a)(i)(x) of this Section 2.15, (ii) there is delivered to the Registrar an
Opinion of Counsel reasonably satisfactory to the Issuers 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 or (iii) such Note has been sold pursuant to an effective registration
statement under the Securities Act and the Trustee has received an Officers'
Certificate from the Issuers to such effect.
(d) General. By its acceptance of any Note bearing the Private
-------
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.14 or this Section 2.15.
The Issuers shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable notice to the Registrar.
Section 2.16. Computation of Interest.
-----------------------
Interest on the Notes shall be computed on the basis of a 360-day year
of twelve 30-day months.
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ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee.
------------------
If the Issuers elect to redeem Notes pursuant to paragraph 6 of the
Notes, (i) at least 45 days prior to the Redemption Date in the case of a
partial redemption, (ii) at least 45 days prior to the Redemption Date in the
case of a total redemption or (iii) during such other period as the Trustee may
agree to (which agreement shall not unreasonably be withheld) the Issuers shall
notify the Trustee in writing of the Redemption Date, the principal amount of
Notes to be redeemed and the redemption price, and deliver to the Trustee an
Officers' Certificate stating that such redemption will comply with the
conditions contained in paragraph 6 of the Notes, as appropriate.
Section 3.02. Selection by Trustee of Notes to Be Redeemed.
--------------------------------------------
In the event that fewer than all of the Notes are to be redeemed, the
Trustee shall select the Notes to be redeemed, if the Notes are listed on a
national securities exchange, in accordance with the rules of such exchange or,
if the Notes are not so listed, either on a pro rata basis or by lot, or such
other method as it shall deem fair and equitable; provided, however, that if a
-------- -------
partial redemption is made with the proceeds of a Public Equity Offering,
selection of the Notes or portion thereof for redemption shall be made by the
Trustee on a pro rata basis, unless such a method is prohibited. The Trustee
--- ----
shall promptly notify the Issuers of the Notes selected for redemption and, in
the case of any Notes selected for partial redemption, the principal amount
thereof to be redeemed. The Trustee may select for redemption portions of the
principal of the Notes that have denominations larger than $1,000. Notes and
portions thereof the Trustee selects shall be redeemed in amounts of $1,000 or
whole multiples of $1,000. For all purposes of this Indenture unless the
context otherwise requires, provisions of this Indenture that apply to Notes
called for redemption also apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption.
--------------------
At least 30 days, and no more than 60 days, before a Redemption Date,
the Issuers shall mail, or cause to be mailed, a notice of redemption by first-
class mail to each Holder of Notes to be redeemed at his or her last address as
the same appears on
-46-
the registry books maintained by the Registrar pursuant to Section 2.03 hereof.
The notice shall identify the Notes to be redeemed (including the
CUSIP numbers thereof) and shall state:
(1) the Redemption Date and the amount of premium and accrued interest
to be paid;
(2) the redemption price and the amount of premium and accrued
interest to be paid;
(3) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date and upon surrender of such Note, a new Note or Notes in principal
amount equal to the unredeemed portion will be issued;
(4) the name and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(6) that unless the Issuers default in making the redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
Redemption Date;
(7) the provision of paragraph 6 of the Notes pursuant to which the
Notes called for redemption are being redeemed; and
(8) the aggregate principal amount of Notes that are being redeemed.
At the Issuers' written request made at least five Business Days prior
to the date on which notice is to be given, the Trustee shall give the notice of
redemption in the Issuers' name and at the Issuers' sole expense.
Section 3.04. Effect of Notice of Redemption.
------------------------------
Once the notice of redemption described in Section 3.03 is mailed,
Notes called for redemption become due and payable on the Redemption Date and at
the redemption price, including any premium, plus interest accrued to the
Redemption Date. Upon surrender to the Paying Agent, such Notes shall be paid
at the redemption price, including any premium, plus interest accrued to
-47-
the Redemption Date, provided that if the Redemption Date is after a regular
--------
record date and on or prior to the Interest Payment Date, the accrued interest
shall be payable to the Holder of the redeemed Notes registered on the relevant
record date, and provided, further, that if a Redemption Date is a Legal
-------- -------
Holiday, payment shall be made on the next succeeding Business Day and no
interest shall accrue for the period from such Redemption Date to such
succeeding Business Day.
Section 3.05. Deposit of Redemption Price.
---------------------------
On or prior to 10:00 A.M., New York City time, on each Redemption
Date, the Issuers shall deposit with the Paying Agent in immediately available
funds money sufficient to pay the redemption price of and accrued interest on
all Notes to be redeemed on that date other than Notes or portions thereof
called for redemption on that date which have been delivered by the Issuers to
the Trustee for cancellation.
On and after any Redemption Date, if money sufficient to pay the
redemption price of and accrued interest on Notes called for redemption shall
have been made available in accordance with the preceding paragraph, the Notes
called for redemption will cease to accrue interest and the only right of the
Holders of such Notes will be to receive payment of the redemption price of and,
subject to the first proviso in Section 3.04, accrued and unpaid interest on
such Notes to the Redemption Date. If any Note surrendered for redemption shall
not be so paid, interest will be paid, from the Redemption Date until such
redemption payment is made, on the unpaid principal of the Note and any interest
not paid on such unpaid principal, in each case, at the rate and in the manner
provided in the Notes.
Section 3.06. Notes Redeemed in Part.
----------------------
Upon surrender of a Note that is redeemed in part, the Trustee shall
authenticate for a Holder a new Note equal in principal amount to the unredeemed
portion of the Note surrendered.
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ARTICLE 4
COVENANTS
Section 4.01. Payment of Notes.
----------------
The Issuers shall, jointly and severally, pay the principal of and
interest (including all Additional Interest as provided in the Registration
Rights Agreement) on the Notes on the dates and in the manner provided in the
Notes and this Indenture. An installment of principal or interest shall be
considered paid on the date it is due if the Trustee or Paying Agent holds on
that date money designated for and sufficient to pay such installment.
The Issuers shall pay interest on overdue principal (including post-
petition interest in a proceeding under any Bankruptcy Law), and overdue
interest, to the extent lawful, at the rate specified in the Notes.
Section 4.02. SEC Reports.
-----------
(a) The Issuers will file with the SEC all information, documents and
reports to be filed with the SEC pursuant to Section 13 or 15(d) of the Exchange
Act, in the case of the Company, whether or not the Company is required to file
with the SEC pursuant to Section 13 or 15(d) of the Exchange Act, and in the
case of Capital, only to the extent subject to such filing requirements. The
Issuers (at their own expense) will file with the Trustee within 15 days after
they file them with the SEC, copies of the annual reports and of the
information, documents and other reports (or copies of such portions of any of
the foregoing as the SEC may by rules and regulations prescribe) which the
Issuers file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act.
Upon qualification of this Indenture under the TIA, the Issuers shall also
comply with the provisions of TIA (S) 314(a). Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Issuers' compliance with any of their covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
(b) At the Issuers' expense, regardless of whether the Issuers are
required to furnish such reports and other information referred to in paragraph
(a) above to their
-49-
equityholders pursuant to the Exchange Act, the Company shall cause such reports
and other information to be mailed to the Holders at their addresses appearing
in the register of Notes maintained by the Registrar within 15 days after they
file them with the SEC.
(c) The Issuers shall, upon request, provide to any Holder of Notes or
any prospective transferee of any such Holder any information concerning the
Issuers (including financial statements) necessary in order to permit such
Holder to sell or transfer Notes in compliance with Rule 144A under the
Securities Act; provided, however, that the Issuers shall not be required to
-------- -------
furnish such information in connection with any request made on or after the
date which is three years from the later of (i) the date such Note (or any
predecessor Note) was acquired from the Issuers or (ii) the date such Note (or
any predecessor Note) was last acquired from an "affiliate" of the Issuers
within the meaning of Rule 144 under the Securities Act.
Section 4.03. Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Issuers covenant (to the extent that they may lawfully do so) that
they will not at any time insist upon, or plead (as a defense or otherwise) or
in any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury law or other law which would prohibit or forgive the
Issuers from paying all or any portion of the principal of, premium, if any,
and/or interest on the Notes 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 they may lawfully do so)
the Issuers hereby expressly waive all benefit or advantage of any such law, and
covenant that they 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.
Section 4.04. Compliance Certificate.
----------------------
(a) The Issuers shall deliver to the Trustee, within 100 days after
the end of each fiscal year and on or before 50 days after the end of the first,
second and third quarters of each fiscal year, an Officers' Certificate (one of
the signers on behalf of each of the Issuers of which shall be the principal
executive officer, principal financial officer or principal accounting officer
of such Issuer) stating that a review of the activities of the Issuers and their
Subsidiaries during such fiscal year or fiscal quarter, as the case may be,
has been made
-50-
under the supervision of the signing Officers with a view to determining whether
the Issuers have kept, observed, performed and fulfilled their 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 Issuers have kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and are not in default in the performance or observance of any of the
terms, provisions and conditions hereof (or, if a Default or Event of Default
shall have occurred, describing all such Defaults or Events of Default of which
he or she may have knowledge and what action they are taking or propose to take
with respect thereto) and that to the best of his or her knowledge no event has
occurred and remains in existence by reason of which payments on account of the
principal of or interest, if any, on the Notes is prohibited or if such event
has occurred, a description of the event and what action the Issuers are taking
or propose to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants, the year-end financial
statements delivered pursuant to Section 4.02 above shall be accompanied by a
written statement of the Issuers' independent public accountants (who shall be a
firm of established national reputation) that in making the examination
necessary for certification of such financial statements nothing has come to
their attention which would lead them to believe that the Issuers have violated
any provisions of this Article 4 or Article 5 of this Indenture 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 for any failure to obtain knowledge of any such violation.
(c) The Issuers will, so long as any of the Notes are outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers' Certificate specifying such Default or Event
of Default and what action the Issuers are taking or propose to take with
respect thereto.
(d) The Company's fiscal year currently ends on November 30. The
Company will provide notice to the Trustee of any change in its fiscal year.
Section 4.05. Taxes.
-----
The Issuers shall, and shall cause each of their Subsidiaries to, pay
prior to delinquency all material taxes,
-51-
assessments, and governmental levies except as contested in good faith and by
appropriate proceedings.
Section 4.06. Limitation on Additional Indebtedness.
-------------------------------------
The Issuers shall not, and shall not permit any Restricted Subsidiary
of the Issuers to, directly or indirectly, incur any Indebtedness (including
Acquired Indebtedness) unless (a) after giving effect to the incurrence of such
Indebtedness and the receipt and application of the proceeds thereof, the ratio
of the total Indebtedness of the Issuers and their Restricted Subsidiaries
(excluding any Indebtedness owed to a Restricted Subsidiary by any other
Restricted Subsidiary or the Issuers and any Indebtedness owed to the Issuers by
any Restricted Subsidiary) to the Issuers' EBITDA (determined on a pro forma
basis for the last four fiscal quarters of the Issuers for which financial
statements are available at the date of determination) is less than 6.0 to 1;
provided, however, that if the Indebtedness which is the subject of a
- -------- -------
determination under this provision is Acquired Indebtedness, or Indebtedness
incurred in connection with the simultaneous acquisition of any Person,
business, property or assets, then such ratio shall be determined by giving
effect to (on a pro forma basis, as if the transaction had occurred at the
beginning of the four-quarter period) both the incurrence or assumption of such
Acquired Indebtedness or such other Indebtedness by the Issuers and the
inclusion in the Issuers' EBITDA of the EBITDA of the acquired Person, business,
property or assets and any pro forma expense and cost reductions calculated on a
basis consistent with Regulation S-X under the Securities Act as in effect and
as applied as of the date hereof, and (b) no Default or Event of Default shall
have occurred and be continuing at the time or as a consequence of the
incurrence of such Indebtedness.
Notwithstanding the foregoing, the Issuers and their Restricted
Subsidiaries may incur Permitted Indebtedness.
Neither BrightView nor Holdings shall, directly or indirectly, incur
or remain or become directly or indirectly liable with respect to any
Indebtedness except that BrightView and Holdings (a) may guarantee (i) the
Notes, (ii) the indebtedness of the Company under the Senior Credit Facility and
the other Credit Documents (as defined in the Senior Credit Facility) and (iii)
any Indebtedness of the Company or any Restricted Subsidiary permitted to be
incurred under the immediately preceding paragraphs and (b) may incur
Indebtedness in an aggregate principal amount not exceeding $5,000,000
outstanding at any time issued to repurchase their Capital Stock
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from former management employees in connection with their termination or
departure (provided that such Indebtedness is subordinated in right and time of
--------
payment to (i) and (ii) of (a) above).
Section 4.07. Limitation on Preferred Stock of
Restricted Subsidiaries.
--------------------------------
The Issuers shall not permit any Restricted Subsidiary to issue any
Preferred Stock (except Preferred Stock to the Company or a Restricted
Subsidiary) or permit any Person (other than the Company or a Subsidiary) to
hold any such Preferred Stock unless the Company or such Restricted Subsidiary
would be entitled to incur or assume Indebtedness under the first paragraph of
Section 4.06 hereof in an aggregate principal amount equal to the aggregate
liquidation value of the Preferred Stock to be issued.
Section 4.08. Limitation on Capital Stock of Subsidiaries.
-------------------------------------------
The Issuers shall not (i) sell, pledge, hypothecate or otherwise
convey or dispose of any Capital Stock of a Subsidiary (other than under the
Senior Credit Facility or under the terms of any Designated Senior Indebtedness)
or (ii) permit any of their Subsidiaries to issue any Capital Stock, other than
to the Issuers or a Wholly-Owned Subsidiary of the Issuers. The foregoing
restrictions shall not apply to an Asset Sale made in compliance with Section
4.10 hereof or the issuance of Preferred Stock in compliance with Section 4.07
hereof. In no event shall the Company sell, pledge, hypothecate or otherwise
convey or dispose of any Capital Stock of Capital nor shall Capital issue any of
its Capital Stock.
Section 4.09. Limitation on Restricted Payments.
---------------------------------
The Issuers will not make, and will not permit any of their Restricted
Subsidiaries to, directly or indirectly, make, any Restricted Payment, unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or immediately after giving effect to such
Restricted Payment;
(b) immediately after giving pro forma effect to such Restricted
--- -----
Payment, the Issuers could incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness) under Section 4.06 hereof; and
-53-
(c) immediately after giving effect to such Restricted Payment, the
aggregate of all Restricted Payments declared or made after the Issue Date
does not exceed the sum of (1) 50% of the cumulative Consolidated Net
Income of the Company subsequent to the Issue Date (or minus 100% of any
cumulative deficit in Consolidated Net Income during such period) plus (2)
100% of the aggregate Net Proceeds and the fair market value of securities
or other property received by the Company from the issue or sale, after the
Issue Date, of Capital Stock (other than Disqualified Capital Stock or
Capital Stock of the Company issued to any Subsidiary of the Company) of
the Company or any Indebtedness or other securities of the Company
convertible into or exercisable or exchangeable for Capital Stock (other
than Disqualified Capital Stock) of the Company which has been so converted
or exercised or exchanged, as the case may be, plus (3) without duplication
of any amounts included in clauses (1) and (2) above, 100% of the aggregate
net proceeds of any equity contribution received by the Company from a
holder of the Company's Capital Stock. For purposes of determining under
this clause (c) the amount expended for Restricted Payments, cash
distributed shall be valued at the face amount thereof and property other
than cash shall be valued at its fair market value determined, in good
faith, by the Issuers' Board of Directors of the Company.
The provisions of this Section 4.09 shall not prohibit: (i) the
payment of any distribution within 60 days after the date of declaration
thereof, if at such date of declaration such payment would comply with the
provisions of this Indenture; (ii) the retirement of any shares of Capital Stock
of the Company or subordinated Indebtedness by conversion into, or by or in
exchange for, shares of Capital Stock (other than Disqualified Capital Stock),
or out of, the Net Proceeds of the substantially concurrent sale (other than to
a Subsidiary of the Company) of other shares of Capital Stock of the Company
(other than Disqualified Capital Stock); (iii) the redemption or retirement of
Indebtedness of the Issuers subordinated to the Notes in exchange for, by
conversion into, or out of the Net Proceeds of, a substantially concurrent sale
or incurrence of Indebtedness (other than any Indebtedness owed to a Subsidiary)
of the Issuers that is contractually subordinated in right of payment to the
Notes to at least the same extent as the subordinated Indebtedness being
redeemed or retired; (iv) the retirement of any shares of Disqualified Capital
Stock by conversion into, or by exchange for, shares of Disqualified Capital
Stock, or out of the Net Proceeds of the substantially concurrent sale (other
than to a Subsidiary of the Company) of other shares of Disqualified
-54-
Capital Stock; (v) if no Event of Default listed in clause (1),(2),(6) or (7) of
Section 6.01 shall have occurred and be continuing, or would result from any
such distribution, Permitted Tax Distributions; or (vi) dividend payments or
other distributions of cash by the Company in an amount not in excess of (y)
$1,000,000 per fiscal year solely for the purpose of paying fees and expenses of
BrightView and Holdings, including directors' fees, less (z) the amount of any
management, advisory, consulting and similar fees paid by the Company to Willis
Stein and its Affiliates during such fiscal year.
Not later than the date of making any Restricted Payment, the Issuers
shall deliver to the Trustee an Officers' Certificate stating that such
Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.09 were computed, which calculations may
be based upon the Issuers' latest available financial statements, and that no
Default or Event of Default exists and is continuing and no Default or Event of
Default will occur immediately after giving effect to any Restricted Payments.
Section 4.10. Limitation on Certain Asset Sales.
---------------------------------
(a) The Issuers shall not, and shall not permit any of their
Restricted Subsidiaries to, consummate an Asset Sale unless (i) the Company or
such Restricted Subsidiary, as the case may be, receives consideration at the
time of such sale or other disposition at least equal to the fair market value
thereof (as determined in good faith by the Board of Directors of the Company,
and evidenced by a Board Resolution); (ii) not less than 85% of the
consideration received by the Company or its Subsidiaries, as the case may be,
is in the form of cash or Temporary Cash Investments; and (iii) the Asset Sale
Proceeds received by the Company or such Restricted Subsidiary are applied (a)
first, to the extent the Company elects, or is required, to prepay, repay or
purchase debt under any then existing Senior Indebtedness of the Company or any
Restricted Subsidiary within 180 days following the receipt of the Asset Sale
Proceeds from any Asset Sale; provided that any such repayment shall result in a
permanent reduction of the commitments thereunder in an amount equal to the
principal amount so repaid; (b) second, to the extent of the balance of Asset
Sale Proceeds after application as described above, to the extent the Company
elects, to an investment in assets (including Capital Stock or other securities
purchased in connection with the acquisition of Capital Stock or property of
another Person) used or useful in businesses similar or ancillary to the
business of the Company or such Restricted Subsidiary as conducted at the time
of such Asset Sale, provided
--------
-55-
that such investment occurs or the Issuers or a Restricted Subsidiary enters
into contractual commitments to make such investment, subject only to customary
conditions (other than the obtaining of financing), on or prior to the 181st day
following receipt of such Asset Sale Proceeds (the "Reinvestment Date") and
Asset Sale Proceeds contractually committed are so applied within 270 days
following the receipt of such Asset Sale Proceeds; and (c) third, if, on the
Reinvestment Date with respect to any Asset Sale, the Available Asset Sale
Proceeds exceed $5,000,000, the Issuers shall apply an amount equal to such
Available Asset Sale Proceeds to an offer to repurchase the Notes, at a purchase
price in cash equal to 100% of the principal amount thereof plus accrued and
unpaid interest, if any, to the date of repurchase (an "Excess Proceeds Offer").
(b) If the Issuers are required to make an Excess Proceeds Offer, the
Issuers shall mail, within 30 days following the Reinvestment Date, a notice to
the Holders stating, among other things: (1) that such Holders have the right
to require the Issuers to apply the Available Asset Sale Proceeds to repurchase
such Notes at a purchase price in cash equal to 100% of the principal amount
thereof plus accrued and unpaid interest, if any, to the date of purchase; (2)
the purchase date (the "Purchase Date"), which shall be no earlier than 30 days
and not later than 60 days from the date such notice is mailed; (3) the
instructions, determined by the Issuers, that each Holder must follow in order
to have such Notes repurchased; and (4) the calculations used in determining the
amount of Available Asset Sale Proceeds to be applied to the repurchase of such
Notes. The Excess Proceeds Offer shall remain open for a period of 20 Business
Days following its commencement (the "Offer Period"). The notice, which shall
govern the terms of the Excess Proceeds Offer, shall state:
(1) that the Excess Proceeds Offer is being made pursuant to this
Section 4.10 and the length of time the Excess Proceeds Offer will remain
open;
(2) the purchase price and the Purchase Date;
(3) that any Note not tendered or accepted for payment will continue
to accrue interest;
(4) that any Note accepted for payment pursuant to the Excess Proceeds
Offer shall cease to accrue interest on and after the Purchase Date and the
deposit of the purchase price with the Trustee;
-56-
(5) that Holders electing to have a Note purchased pursuant to any
Excess Proceeds Offer will be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, to the Issuers, a depositary, if appointed by the Issuers, or a
Paying Agent at the address specified in the notice prior to the close of
business on the Business Day preceding the Purchase Date;
(6) that Holders will be entitled to withdraw their election if the
Issuers, depositary or Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the
Note the Holder delivered for purchase and a statement that such Holder is
withdrawing his election to have the Note purchased;
(7) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Available Asset Sale Proceeds, the Issuers shall select
the Notes to be purchased on a pro rata basis (with such adjustments as may
be deemed appropriate by the Issuers so that only Notes in denominations of
$1,000, or integral multiples thereof, shall be purchased); and
(8) that Holders whose Notes were purchased only in part will be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered.
On or before the Purchase Date, the Issuers shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, Notes
or portions thereof tendered pursuant to the Excess Proceeds Offer, deposit with
the Paying Agent U.S. legal tender sufficient to pay the purchase price plus
accrued interest, if any, on the Notes to be purchased and deliver to the
Trustee an Officers' Certificate stating that such Notes or portions thereof
were accepted for payment by the Issuers in accordance with the terms of this
Section 4.10. The Paying Agent shall promptly (but in any case not later than 5
days after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Note tendered by such Holder and accepted by
the Issuers for purchase, and the Issuers shall promptly issue a new Note, the
guarantors shall endorse the guarantee thereon and the Trustee shall
authenticate and mail or make available for delivery such new Note to such
Holder equal in principal amount to any unpurchased portion of the Note
surrendered. Any Note not so accepted shall be promptly mailed
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or delivered by the Issuers to the Holder thereof. The Issuers will publicly
announce the results of the Excess Proceeds Offer on the Purchase Date by
sending a press release to the Dow Jones News Service or similar business news
service in the United States. If an Excess Proceeds Offer is not fully
subscribed, the Issuers may retain that portion of the Available Asset Sale
Proceeds not required to repurchase Notes.
Section 4.11. Limitation on Transactions with Affiliates.
------------------------------------------
(a) The Issuers shall not, and shall not permit any of their
Restricted Subsidiaries to, directly or indirectly, enter into or suffer to
exist any transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets, property or
services) with any Affiliate (including entities in which the Issuers or any of
its Restricted Subsidiaries own a minority interest) or holder of 10% or more of
the Issuers' Common Stock (an "Affiliate Transaction") other than transactions
existing on the date hereof and described on Schedule 4.11 hereto, or extend,
renew, waive or otherwise modify the terms of any Affiliate Transaction entered
into prior to the Issue Date if such extension, renewal, waiver or other
modification is more disadvantageous to the Holders in any material respect than
the original agreement as in effect on the Issue Date unless (i) such Affiliate
Transaction is between or among the Issuers and their Wholly-Owned Subsidiaries;
or (ii) the terms of such Affiliate Transaction are fair and reasonable to the
Issuers or such Restricted Subsidiary, as the case may be, and the terms of such
Affiliate Transaction are at least as favorable as the terms which could be
obtained by the Issuers or such Restricted Subsidiary, as the case may be, in a
comparable transaction made on an arm's-length basis between unaffiliated
parties. In any Affiliate Transaction involving an amount or having a value in
excess of $1,000,000 which is not permitted under clause (i) above, the Issuers
must obtain a resolution of the Board of Directors certifying that such
Affiliate Transaction complies with clause (ii) above. In transactions with a
value in excess of $3,000,000 which are not permitted under clause (i) above,
the Issuers must obtain a written opinion as to the fairness of such a
transaction from an independent investment banking firm.
(b) The limitations set forth in Section 4.11(a) shall not apply to
(i) any Restricted Payment that is not prohibited by Section 4.09 hereof, (ii)
any transaction, approved by the Board of Directors of the Issuers, with an
officer or director of the Issuers or of any Subsidiary in his or her capacity
as officer or director entered into in the ordinary course of business, (iii)
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transactions permitted by Section 5.01 hereof or (iv) transactions after the
date of this Indenture that are expressly contemplated by the Securities
Purchase Agreement and the Securityholders Agreement (including any registration
rights described therein) and are not prohibited by any other provision of this
Indenture or the Notes; provided that the aggregate management, advisory,
consulting and similar fees paid by the Company to Willis Stein and its
Affiliates pursuant to the Securities Purchase Agreement or otherwise shall not
exceed (y) $1,000,000 during any fiscal year less (z) the amount of any
distributions made by the Company during such fiscal year pursuant to clause
(vi) of the second paragraph of Section 4.09, and provided, further, that any
such fees may accrue but shall not be paid by the Company at any time after the
occurrence and during the continuance of a Default or Event of Default.
Section 4.12. Limitations on Liens.
--------------------
The Issuers shall not, and shall not permit any of their Restricted
Subsidiaries to, create, incur or otherwise cause or suffer to exist or become
effective any Liens of any kind (other than Permitted Liens) upon any property
or asset of the Issuers or any Restricted Subsidiary or any shares of stock or
debt of any Restricted Subsidiary which owns property or assets, now owned or
hereafter acquired, unless (i) if such Lien secures Indebtedness which is pari
----
passu with the Notes, then the Notes are secured on an equal and ratable basis
- -----
with the obligations so secured until such time as such obligation is no longer
secured by a Lien or (ii) if such Lien secures Indebtedness which is
subordinated to the Notes, any such Lien shall be subordinated to the Lien
granted to the Holders of the Notes to the same extent as such subordinated
Indebtedness is subordinated to the Notes.
Section 4.13. Limitations on Investments.
--------------------------
The Issuers shall not, and shall not permit any of their Restricted
Subsidiaries to, make any Investment other than (i) a Permitted Investment or
(ii) an Investment that is made as a Restricted Payment in compliance with
Section 4.09 hereof, after the Issue Date.
Section 4.14. Limitation on Creation of Subsidiaries.
--------------------------------------
The Issuers shall not create or acquire, nor permit any of their
Restricted Subsidiaries to create or acquire, any Subsidiary other than (i) a
Restricted Subsidiary that is acquired or created in connection with the
acquisition by the
-59-
Company of a media related business or asset, or (ii) an Unrestricted
Subsidiary; provided, however, that each Restricted Subsidiary acquired or
-------- -------
created pursuant to clause (i) shall at the time it has either assets or
stockholder's equity in excess of $5,000 have evidenced its guarantee with such
documentation satisfactory in form and substance to the Trustee relating thereto
as the Trustee shall require, including, without limitation a supplement or
amendment to this Indenture and Opinions of Counsel as to the enforceability of
such guarantee, pursuant to which such Restricted Subsidiary shall become a
Guarantor.
Section 4.15. Limitation on Other Senior Subordinated Debt.
--------------------------------------------
The Issuers shall not, and shall not permit any of their Restricted
Subsidiaries to, directly or indirectly, incur, contingently or otherwise, any
Indebtedness (other than the Notes and the Guarantees, as the case may be) that
is both (i) subordinate in right of payment to any Senior Indebtedness of the
Issuers or their Restricted Subsidiaries, as the case may be, and (ii) senior in
right of payment to the Notes and the Guarantees, as the case may be. For
purposes of this Section 4.15, Indebtedness is deemed to be senior in right of
payment to the Notes and the Guarantees, as the case may be, if it is not
explicitly subordinate in right of payment to Senior Indebtedness at least to
the same extent as the Notes and the Guarantees, as the case may be, are
subordinate to Senior Indebtedness.
Section 4.16. Limitation on Sale and Lease-Back Transactions.
----------------------------------------------
The Issuers shall not, and shall not permit any Restricted Subsidiary
to, enter into any Sale and Lease-Back Transaction unless (i) the consideration
received in such Sale and Lease-Back Transaction is at least equal to the fair
market value of the property sold, as determined, in good faith, by the Board of
Directors of the Company and (ii) the Issuers could incur the Attributable
Indebtedness in respect of such Sale and Lease-Back Transaction in compliance
with Section 4.06.
Section 4.17. Payments for Consent.
--------------------
Neither the Issuers nor any of their Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Notes for or as an inducement
to any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or agreed
to be paid to all Holders of the Notes which so
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consent, waive or agree to amend in the time frame set forth in solicitation
documents relating to such consent, waiver or agreement.
Section 4.18. Legal Existence.
---------------
Subject to Article 5 hereof, the Issuers shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) their
legal existence, and the corporate, partnership or other existence of each
Restricted Subsidiary, in accordance with the respective organizational
documents (as the same may be amended from time to time) of each Restricted
Subsidiary and the rights (charter and statutory), licenses and franchises of
the Issuers and their Restricted Subsidiaries; provided, however, that the
-------- -------
Issuers shall not be required to preserve any such right, license or franchise,
or the corporate, partnership or other existence of any of their Restricted
Subsidiaries if the Board of Directors of the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Issuers and their Restricted Subsidiaries, taken as a whole, and that the
loss thereof is not adverse in any material respect to the Holders.
Section 4.19. Change of Control.
-----------------
(a) Within 20 days of the occurrence of a Change of Control, the
Company shall notify the Trustee in writing of such occurrence and shall make an
offer to purchase (the "Change of Control Offer") the outstanding Notes at a
purchase price equal to 101% of the principal amount thereof plus any accrued
and unpaid interest thereon to the Change of Control Payment Date (such purchase
price being hereinafter referred to as the "Change of Control Purchase Price")
in accordance with the procedures set forth in this Section 4.19.
If the Senior Credit Facility is in effect, or any amounts are owing
thereunder, at the time of the occurrence of a Change of Control, prior to the
mailing of the notice to Holders described in paragraph (b) below, but in any
event within 20 days following any Change of Control, the Issuers on a joint and
several basis covenant to (i) repay in full all obligations under the Senior
Credit Facility or offer to repay in full all obligations under or in respect of
the Senior Credit Facility and repay the obligations under or in respect of the
Senior Credit Facility of each lender who has accepted such offer or (ii) obtain
the requisite consent under the Senior Credit Facility to permit the repurchase
of the Notes pursuant to this Section 4.19. The Issuers must first comply with
the covenant
-61-
described in the preceding sentence before they shall be required to purchase
Notes in the event of a Change of Control; provided that the Issuers' failure to
--------
comply with the covenant described in the preceding sentence constitutes an
Event of Default described in clause (3) under Section 6.01 hereof if not cured
within 60 days after the notice required by such clause.
(b) Within 20 days of the occurrence of a Change of Control, the
Company also shall (i) cause a notice of the Change of Control Offer to be sent
at least once to the Dow Jones News Service or similar business news service in
the United States and (ii) send by first-class mail, postage prepaid, to the
Trustee and to each Holder of the Notes, at the address appearing in the
register maintained by the Registrar of the Notes, a notice stating:
(i) that the Change of Control Offer is being made pursuant to this
Section 4.19 and that all Notes tendered will be accepted for payment, and
otherwise subject to the terms and conditions set forth herein;
(ii) the Change of Control Purchase Price and the purchase date
(which shall be a Business Day no earlier than 20 Business Days from the
date such notice is mailed (the "Change of Control Payment Date"));
(iii) that any Note not tendered will continue to accrue interest;
(iv) that, unless the Issuers default in the payment of the Change
of Control Purchase Price, any Notes accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest after the Change of
Control Payment Date;
(v) that Holders accepting the offer to have their Notes purchased
pursuant to a Change of Control Offer will be required to surrender the
Notes, with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Note completed, to the Paying Agent at the address specified
in the notice prior to the close of business on the Business Day preceding
the Change of Control Payment Date;
(vi) that Holders will be entitled to withdraw their acceptance if
the Paying Agent receives, not later than the close of business on the
third Business Day preceding the Change of Control Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the name of
the Holder, the principal amount of the Notes delivered for purchase,
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and a statement that such Holder is withdrawing his election to have such
Notes purchased;
(vii) that Holders whose Notes are being purchased only in part will
be issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered, provided that each Note purchased and each such new
--------
Note issued shall be in an original principal amount in denominations of
$1,000 and integral multiples thereof;
(viii) any other procedures that a Holder must follow to accept a
Change of Control Offer or effect withdrawal of such acceptance; and
(ix) the name and address of the Paying Agent.
On the Change of Control Payment Date, the Issuers shall, to the
extent lawful, (i) accept for payment Notes or portions thereof tendered
pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent
money sufficient to pay the purchase price of all Notes or portions thereof so
tendered and (iii) deliver or cause to be delivered to the Trustee Notes so
accepted together with an Officers' Certificate stating the Notes or portions
thereof tendered to the Issuers. The Paying Agent shall promptly mail to each
Holder of Notes so accepted payment in an amount equal to the purchase price for
such Notes, and the Issuers shall execute and issue, the Guarantors shall
endorse the Guarantee and the Trustee shall promptly authenticate and mail to
such Holder, a new Note equal in principal amount to any unpurchased portion of
the Notes surrendered; provided that each such new Note shall be issued in an
--------
original principal amount in denominations of $1,000 and integral multiples
thereof.
(c) (i) If either Issuer or any Subsidiary thereof has issued any
outstanding (A) Indebtedness that is subordinated in right of payment to the
Notes or (B) Preferred Stock, and such Issuer or Subsidiary is required to make
a change of control offer or to make a distribution with respect to such
subordinated Indebtedness or Preferred Stock in the event of a change of
control, the Issuers shall not consummate any such offer or distribution with
respect to such subordinated Indebtedness or Preferred Stock until such time as
the Issuers shall have paid the Change of Control Purchase Price in full to the
Holders of Notes that have accepted the Issuers' Change of Control Offer and
shall otherwise have consummated the Change of Control Offer made to Holders of
the Notes and (ii) the Issuers will not issue Indebtedness that is subordinated
in right of payment to the Notes or Preferred Stock with change of control
provisions
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requiring the payment of such Indebtedness or Preferred Stock prior to the
payment of the Notes in the event of a Change in Control under the Indenture.
In the event that a Change of Control occurs and the Holders of Notes
exercise their right to require the Issuers to purchase Notes, if such purchase
constitutes a "tender offer" for purposes of Rule 14e-1 under the Exchange Act
at that time, the Issuers will comply with the requirements of Rule 14e-1 as
then in effect with respect to such repurchase.
Section 4.20. Maintenance of Office or Agency.
-------------------------------
The Issuers shall maintain an office or agency where Notes may be
surrendered for registration of transfer or exchange or for presentation for
payment and where notices and demands to or upon the Issuers in respect of the
Notes and this Indenture may be served. The Issuers 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 Issuers 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 as set forth in Section 12.02.
The Issuers may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations. The
Issuers shall give prompt written notice to the Trustee of such designation or
rescission and of any change in the location of any such other office or agency.
The Issuers hereby initially designate the Corporate Trust Office of
the Trustee set forth in Section 12.02 as such office of the Issuers.
Section 4.21. Maintenance of Properties; Insurance; Books
and Records; Compliance with Law.
-------------------------------------------
(a) The Issuers shall, and shall cause each of their Restricted
Subsidiaries to, at all times cause all properties used or useful in the conduct
of their business to be maintained and kept in good condition, repair and
working order (reasonable wear and tear excepted) and supplied with all
necessary equipment, and shall cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereto.
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(b) The Issuers shall, and shall cause each of their Restricted
Subsidiaries to, maintain insurance (which may include self-insurance) in such
amounts and covering such risks as are usually and customarily carried with
respect to similar facilities according to their respective locations.
(c) The Issuers shall, and shall cause each of their Subsidiaries to,
keep proper books of record and account, in which full and correct entries shall
be made of all financial transactions and the assets and business of the Issuers
and each Subsidiary of the Issuers, in accordance with GAAP consistently applied
to the Issuers and their Subsidiaries taken as a whole.
(d) The Issuers shall and shall cause each of their Subsidiaries to
comply with all statutes, laws, ordinances or government rules and regulations
to which they are subject, non-compliance with which would materially adversely
affect the business, prospects, earnings, properties, assets or financial
condition of the Issuers and their Subsidiaries taken as a whole.
Section 4.22. Further Assurance to the Trustee.
--------------------------------
The Issuers shall, upon the reasonable request of the Trustee, execute
and deliver such further instruments and do such further acts as may be
reasonably necessary or proper to carry out more effectively the provisions of
this Indenture.
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01. Limitation on Consolidation,
Merger and Sale of Assets.
----------------------------
(a) Neither of the Issuers will, nor will they permit any Guarantor
to, consolidate with, merge with or into, or transfer all or substantially all
of its assets (as an entirety or substantially as an entirety in one transaction
or a series of related transactions), to any Person unless (in the case of the
Company or any Guarantor): (i) the Company or such Guarantor, as the case may
be, shall be the continuing Person, or the Person (if other than the Company or
such Guarantor) formed by such consolidation or into which the Company or such
Guarantor, as the case may be, is merged or to which the properties and assets
of the Company or such Guarantor, as the case may be, are transferred shall be a
corporation (or in the case of the Company or Holdings, a corporation or a
limited liability company)
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organized and existing under the laws of the United States or any State thereof
or the District of Columbia and shall expressly assume, by a supplemental
indenture, executed and delivered to the Trustee, in form and substance
satisfactory to the Trustee, all of the obligations of the Company or such
Guarantor, as the case may be, under the Notes and this Indenture, and the
obligations under this Indenture shall remain in full force and effect; provided
--------
that at any time the Company or its successor is a limited liability company
there shall be a co-issuer of the Notes that is a corporation; (ii) immediately
before and immediately after giving effect to such transaction, no Default or
Event of Default shall have occurred and be continuing; (ii) immediately after
giving effect to such transaction or series of transactions on a pro forma basis
the Consolidated Net Worth of the Company or the surviving entity as the case
may be is at least equal to the Consolidated Net Worth of the Company
immediately before such transaction or series of transactions; and (iv)
immediately after giving effect to such transaction on a pro forma basis the
--- -----
Company or such Person could incur at least $1.00 of additional Indebtedness
(other than Permitted Indebtedness) pursuant to Section 4.06 hereof, provided
--------
that a Holdings may merge into the Company, the Company may merge into Holdings
and Holdings or the Company may merge into BrightView without complying with
this clause (iv).
(b) In connection with any consolidation, merger or transfer of assets
contemplated by this Section 5.01, the Issuers shall deliver, or cause to be
delivered, to the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger or transfer and the supplemental indenture in respect
thereto comply with this Section 5.01 and that all conditions precedent herein
provided for relating to such transaction or transactions have been complied
with.
Section 5.02. Successor Person Substituted.
----------------------------
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Company or any Guarantor in accordance
with Section 5.01 above, the successor corporation formed by such consolidation
or into which the Company is merged or to which such 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 with the same effect as if
such successor corporation had been named as the Company or such Guarantor
herein, and thereafter the predecessor corporation shall be relieved of all
obligations and covenants under this Indenture and the Notes.
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ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
-----------------
An "Event of Default" occurs if
(1) there is a default in the payment of any principal of, or premium,
if any, on the Notes when the same becomes due and payable at maturity,
upon acceleration, redemption or otherwise, whether or not such payment is
prohibited by the provisions of Article 11 hereof;
(2) there is a default in the payment of any interest on any Note when
the same becomes due and payable and the Default continues for a period of
30 days, whether or not such payment is prohibited by the provisions of
Article 11 hereof;
(3) either of the Issuers or any Guarantor defaults in the observance
or performance of any other covenant in the Notes or this Indenture for 60
days after written notice from the Trustee or the Holders of not less than
25% in the aggregate principal amount of the Notes then outstanding;
(4) there is a default in the payment when due of principal, interest
or premium in an aggregate amount of $1,000,000 or more with respect to any
Indebtedness of either Issuer or any Restricted Subsidiary thereof, or
their is an acceleration of any such Indebtedness aggregating $1,000,000 or
more which default shall not be cured, waived or postponed pursuant to an
agreement with the holders of such Indebtedness within 60 days after
written notice by the Trustee or any Holder, or which acceleration shall
not be rescinded or annulled within 20 days after written notice to the
Issuers of such Default by the Trustee or any Holder;
(5) the entry of a final judgment or judgments which can no longer be
appealed for the payment of money in excess of $1,000,000 against either of
the Issuers or any Restricted Subsidiary thereof and such judgment remains
undischarged, for a period of 60 consecutive days during which a stay of
enforcement of such judgment shall not be in effect;
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(6) either of the Issuers or any Restricted Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in an
involuntary case,
(C) consents to the appointment of a Custodian of it or for all
or substantially all of its property,
(D) makes a general assignment for the benefit of its creditors,
or
(E) generally is not paying its debts as they become due; or
(7) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against either of the Issuers or any Restricted
Subsidiary in an involuntary case,
(B) appoints a Custodian of either of the Issuers or any
Restricted Subsidiary or for all or substantially all of the property
of either of the Issuers or any Restricted Subsidiary, or
(C) orders the liquidation of either of the Issuers or any
Restricted Subsidiary,
and the order or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
The Trustee may withhold notice to the Holders of the Notes of any
Default (except in payment of principal or premium, if any, or interest on the
Notes) if the Trustee considers it to be in the best interest of the Holders of
the Notes to do so. The Trustee shall not be charged with knowledge of any
Default, Event of Default, Change of Control or Asset Sale in payment of
Additional Interest unless written notice thereof shall have been given to a
Responsible Officer at the corporate trust office of the Trustee by the Issuers
or any other Person.
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Section 6.02. Acceleration.
------------
If an Event of Default (other than an Event of Default arising under
Section 6.01(6) or (7) with respect to either of the Issuers) occurs and is
continuing, the Trustee by notice to the Issuers, or the Holders of not less
than 25% in aggregate principal amount of the Notes then outstanding may by
written notice to the Issuers and the Trustee declare to be immediately due and
payable the entire principal amount of all the Notes then outstanding plus
accrued but unpaid interest to the date of acceleration and (i) such amounts
shall become immediately due and payable or (ii) if there are any amounts
outstanding under or in respect of the Senior Credit Facility, such amounts
shall become due and payable upon the first to occur of an acceleration of
amounts outstanding under or in respect of the Senior Credit Facility or five
Business Days after receipt by the Company and the Representative of notice of
the acceleration of the Notes; provided, however, that after such acceleration
-------- -------
but before a judgment or decree based on such acceleration is obtained by the
Trustee, the Holders of a majority in aggregate principal amount of the
outstanding Notes may rescind and annul such acceleration and its consequences
if all existing Events of Default, other than the nonpayment of accelerated
principal, premium, if any, or interest that has become due solely because of
the acceleration, have been cured or waived and if the rescission would not
conflict with any judgment or decree. No such rescission shall affect any
subsequent Default or impair any right consequent thereto. In case an Event of
Default specified in Section 6.01(6) or (7) with respect to either of the
Issuers occurs, such principal, premium, if any, and interest amount with
respect to all of the Notes shall be due and payable immediately without any
declaration or other act on the part of the Trustee or the Holders of the Notes.
Section 6.03. Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of, or premium, if any, and interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture and may
take any necessary action requested of it as Trustee to settle, compromise,
adjust or otherwise conclude any proceedings to which it is a party.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any
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Noteholder in exercising any right or remedy accruing upon an Event of Default
shall not impair the right or remedy or constitute a waiver of or acquiescence
in the Event of Default. No remedy is exclusive of any other remedy. All
available remedies are cumulative.
Section 6.04. Waiver of Past Defaults and Events of Default.
---------------------------------------------
Subject to Sections 6.02, 6.07 and 8.02 hereof, the Holders of a
majority in principal amount of the Notes then outstanding have the right to
waive any existing Default or Event of Default or compliance with any provision
of this Indenture or the Notes. Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Default or Event of Default or impair any right
consequent thereto.
Section 6.05. Control by Majority.
-------------------
The Holders of a majority in principal amount of the Notes then
outstanding 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 the Trustee by this Indenture. The Trustee, however, may refuse to
follow any direction that conflicts with law or this Indenture or that the
Trustee determines may be unduly prejudicial to the rights of another Noteholder
not taking part in such direction, and the Trustee shall have the right to
decline to follow any such direction if the Trustee, being advised by counsel,
determines that the action so directed may not lawfully be taken or if the
Trustee in good faith shall, by a Responsible Officer, determine that the
proceedings so directed may involve it in personal liability; provided that the
--------
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
Section 6.06. Limitation on Suits.
-------------------
Subject to Section 6.07 below, a Noteholder may not institute any
proceeding or pursue any remedy with respect to this Indenture or the Notes
unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
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(2) the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding make a written request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer and if requested provide to the
Trustee indemnity reasonably satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer, and, if requested provision, of
indemnity; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60 day period by the Holders of a majority in
aggregate principal amount of the Notes then outstanding.
A Noteholder may not use this Indenture to prejudice the rights of
another Noteholder or to obtain a preference or priority over another
Noteholder.
Section 6.07. Rights of Holders to Receive Payment.
------------------------------------
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Note to receive payment of principal of, or premium, if any, and
interest of the Note (including Additional Interest) on or after the respective
due dates expressed in the Note, or to bring suit for the enforcement of any
such payment on or after such respective dates, is absolute and unconditional
and shall not be impaired or affected without the consent of the Holder.
Section 6.08. Collection Suit by Trustee.
--------------------------
If an Event of Default in payment of principal, premium or interest
specified in Section 6.01(1) or (2) hereof occurs and is continuing, the Trustee
may recover judgment in its own name and as trustee of an express trust against
the Issuers or the Guarantors (or any other obligor on the Notes) for the whole
amount of unpaid principal and accrued interest remaining unpaid, together with
interest on overdue principal and, to the extent that payment of such interest
is lawful, interest on overdue installments of interest, in each case at the
rate set forth in the Notes, and such further amounts 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.
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Section 6.09. Trustee May File Proofs of Claim.
--------------------------------
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Noteholders allowed in any judicial proceedings relative to the Issuers or the
Guarantors (or any other obligor upon the Notes), its creditors or its property
and shall be entitled and empowered to collect and receive any monies or other
property payable or deliverable on any such claims and to distribute the same
after deduction of its charges and expenses to the extent that any such charges
and expenses are not paid out of the estate in any such proceedings and any
custodian in any such judicial proceeding is hereby authorized by each
Noteholder 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
Noteholders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
or reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Noteholder in any such proceedings.
Section 6.10. Priorities.
----------
If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07 hereof;
SECOND: to Noteholders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest (including Additional Interest, if
any) as to each, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes; and
THIRD: to the Issuers or, to the extent the Trustee collects any
amount from any Guarantor, to such Guarantor.
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The Trustee may fix a record date and payment date for any payment to
Noteholders pursuant to this Section 6.10.
Section 6.11. Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, 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 6.07 hereof or a suit by Holders of more than 10% in
principal amount of the Notes then outstanding.
ARTICLE 7
TRUSTEE
Section 7.01. Duties of Trustee.
-----------------
(a) If an Event of Default actually known to a Responsible Officer of
the Trustee 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 man would exercise or use under
the same circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are specifically
set forth in this Indenture and no others.
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture but, in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty
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to examine the same to determine whether or not they conform to the
requirements of this Indenture (but need not confirm or investigate the
accuracy of mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b) of this
Section 7.01.
(2) The Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts.
(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.02, 6.05 or 6.06 hereof.
(4) 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 rights, powers or duties if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity satisfactory to it against such risk or liability is not
reasonably assured to it.
(d) Whether or not therein expressly so provided, paragraphs (a),
(b), (c) and (e) of this Section 7.01 shall govern every provision of this
Indenture that in any way relates to the Trustee.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it in its sole discretion
against any loss, liability, expense or fee.
(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 Issuers or
any Guarantor. Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by the law.
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Section 7.02. Rights of Trustee.
-----------------
Subject to Section 7.01 hereof:
(1) The Trustee may rely on any document reasonably 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.
(2) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel, or both, which shall
conform to the provisions of Section 12.05 hereof. The Trustee shall be
protected and shall not be liable for any action it takes or omits to take
in good faith in reliance on such certificate or opinion.
(3) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed
by it with due care.
(4) 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.
(5) The Trustee may consult with counsel of its selection, 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.
Section 7.03. Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may make loans to, accept deposits from, perform
services for or otherwise deal with the either of the Issuers or any Guarantor,
or any Affiliates thereof, with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. The Trustee, however,
shall be subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
--------------------
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes or any Guarantee,
it shall not be accountable for the Issuers' or any Guarantor's use of the
proceeds from the sale
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of Notes or any money paid to the Issuers or any Guaranty pursuant to the terms
of this Indenture and it shall not be responsible for any statement in the
Notes, Guarantee or this Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
------------------
If a Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to each Noteholder notice of the Default within
90 days after it occurs. Except in the case of a Default in payment of the
principal of, or premium, if any, or interest on any Note the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in
good faith determine(s) that withholding the notice is in the interests of the
Noteholders.
Section 7.06. Reports by Trustee to Holders.
-----------------------------
If required by TIA (S) 313(a), within 60 days after November of any
year, commencing November , 1997, the Trustee shall mail to each Noteholder a
brief report dated as of such November that complies with TIA (S) 313(a).
The Trustee also shall comply with TIA (S) 313(b)(2). The Trustee shall also
transmit by mail all reports as required by TIA (S) 313(c) and TIA (S) 313(d).
Reports pursuant to this Section 7.06 shall be transmitted by mail:
(1) to all registered Holders of Notes, as the names and addresses of
such Holders appear on the Registrar's books; and
(2) to such Holder of Notes as have, within the two years preceding
such transmission, filed their names and addresses with the Trustee for
that purpose.
A copy of each report at the time of its mailing to Noteholders shall
be filed with the SEC and each stock exchange on which the Notes are listed.
The Issuers shall promptly notify the Trustee when the Notes are listed on any
stock exchange.
Section 7.07. Compensation and Indemnity.
--------------------------
The Issuers and the Guarantors shall pay to the Trustee and Agents
from time to time such compensation as shall be agreed in writing between the
Company and the Trustee for its services hereunder (which compensation shall not
be limited by any
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provision of law in regard to the compensation of a trustee of an express
trust). The Issuers and the Guarantors shall reimburse the Trustee and Agents
upon request for all reasonable disbursements, expenses and advances incurred or
made by it in connection with its duties under this Indenture, including the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The Issuers and the Guarantors shall indemnify each of the Trustee and
any predecessor Trustee for, and hold each of them harmless against, any and all
loss, damage, claim, liability or expense, including without limitation taxes
(other than taxes based on the income of the Trustee or such Agent) and
reasonable attorneys' fees and expenses incurred by each of them in connection
with the acceptance or performance of its duties under this Indenture including
the reasonable costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties hereunder (including, without limitation, settlement costs). The Trustee
or Agent shall notify the Issuers and the Guarantors in writing promptly of any
claim asserted against the Trustee or Agent for which it may seek indemnity.
However, the failure by the Trustee or Agent to so notify the Issuers and the
Guarantors shall not relieve the Issuers and Guarantors of their obligations
hereunder except to the extent the Issuers and the Guarantors are prejudiced
thereby.
Notwithstanding the foregoing, the Issuers and the Guarantors need not
reimburse the Trustee for any expense or indemnify it against any loss or
liability incurred by the Trustee through its negligence or bad faith. To
secure the payment obligations of the Issuers and the Guarantors in this Section
7.07, the Trustee shall have a lien prior to the Notes on all money or property
held or collected by the Trustee except such money or property held in trust to
pay principal of and interest on particular Notes. The obligations of the
Issuers and the Guarantors under this Section 7.07 to compensate and indemnify
the Trustee, Agents and each predecessor Trustee and to pay or reimburse the
Trustee, Agents and each predecessor Trustee for expenses, disbursements and
advances shall be joint and several liabilities of the Issuers and each of the
Guarantors and shall survive the satisfaction, discharge and termination of this
Indenture, including any termination or rejection hereof under any bankruptcy
law.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(6) or (7) hereof occurs, the expenses and the
compensation for the services
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are intended to constitute expenses of administration under any Bankruptcy Law.
For purposes of this Section 7.07, the term "Trustee" shall include
any trustee appointed pursuant to Article 9.
Section 7.08. Replacement of Trustee.
----------------------
The Trustee may resign by so notifying the Issuers and the Guarantors
in writing. The Holders of a majority in principal amount of the outstanding
Notes may remove the Trustee by notifying the removed Trustee in writing and may
appoint a successor Trustee with the Issuers' written consent which consent
shall not be unreasonably withheld. The Issuers may remove the Trustee at their
election if:
(1) the Trustee fails to comply with Section 7.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property;
(4) the Trustee otherwise becomes incapable of acting; or
(5) a successor corporation becomes successor Trustee pursuant to
Section 7.09 below.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuers shall promptly appoint a successor
Trustee.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuers or the
Holders of a majority in principal amount of the outstanding Notes may petition
any court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10 hereof, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Immediately following
such delivery, the retiring Trustee shall, subject to its rights under Section
7.07 hereof, transfer all property held by it as Trustee to the successor
Trustee, 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 Noteholder. Notwithstanding replacement of the
Trustee pursuant to this Section 7.08, the Issuers obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee.
Section 7.09. Successor Trustee by Consolidation, Merger,
Etc.
-------------------------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, subject to Section 7.10 hereof, the successor corporation without
any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
-----------------------------
This Indenture shall always have a Trustee who satisfies the
requirements of TIA (S) 310(a)(1) and (2) in every respect. The Trustee shall
have a combined capital and surplus of at least $100,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with
TIA (S) 310(b), including the provision in (S) 310(b)(1).
Section 7.11. Preferential Collection of Claims Against
Company.
-----------------------------------------
The Trustee 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 therein.
Section 7.12. Paying Agents.
-------------
The Issuers shall cause each Paying Agent other than the Trustee to
execute and deliver to it and the Trustee an instrument in which such agent
shall agree with the Trustee, subject to the provisions of this Section 7.12:
(A) that it will hold all sums held by it as agent for the payment of
principal of, or premium, if any, or interest
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on, the Notes (whether such sums have been paid to it by the Issuers or by
any obligor on the Notes) in trust for the benefit of Holders of the Notes
or the Trustee;
(B) that it will at any time during the continuance of any Event of
Default, upon written request from the Trustee, deliver to the Trustee all
sums so held in trust by it together with a full accounting thereof; and
(C) that it will give the Trustee written notice within three (3)
Business Days of any failure of the Issuers (or by any obligor on the
Notes) in the payment of any installment of the principal of, premium, if
any, or interest on, the Notes when the same shall be due and payable.
ARTICLE 8
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 8.01. Without Consent of Holders.
--------------------------
The Issuers and the Guarantors, when authorized by a Board Resolution
of each of them, and the Trustee may amend, waive or supplement this Indenture
or the Notes without notice to or consent of any Noteholder:
(1) to comply with Section 5.01 hereof;
(2) to provide for uncertificated Notes in addition to or in place of
certificated Notes;
(3) to comply with any requirements of the SEC under the TIA;
(4) to cure any ambiguity, defect or inconsistency, or to make any
other change that does not adversely affect the rights of any Noteholder;
(5) to make any other change that does not adversely affect the
rights of any Noteholders hereunder; or
(6) to add a Guarantor.
The Trustee is hereby authorized to join with the Issuers and the
Guarantors in the execution of any supplemental
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indenture authorized or permitted by the terms of this Indenture and to make any
further appropriate agreements and stipulations which may be therein contained,
but the Trustee shall not be obligated to enter into any such supplemental
indenture which adversely affects its own rights, duties or immunities under
this Indenture.
Section 8.02. With Consent of Holders.
-----------------------
The Issuers (each when authorized by a Board Resolution), the
Guarantors (each when authorized by a Board Resolution) and the Trustee may
modify or supplement this Indenture or the Notes with the written consent of the
Holders of not less than a majority in aggregate principal amount of the
outstanding Notes. The Holders of not less than a majority in aggregate
principal amount of the outstanding Notes may waive compliance in a particular
instance by the Issuers or Guarantors with any provision of this Indenture or
the Notes. Subject to Section 8.04, without the consent of each Noteholder
affected, however, an amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may not:
(1) reduce the amount of Notes whose Holders must consent to an
amendment, supplement or waiver to this Indenture or the Notes;
(2) reduce the rate of or change the time for payment of interest on
any Note;
(3) reduce the principal of or premium on or change the stated
maturity of any Note;
(4) make any Note payable in money other than that stated in the Note
or change the place of payment from New York, New York;
(5) change the amount or time of any payment required by the Notes or
reduce the premium payable upon any redemption of the Notes in accordance
with Section 3.07 hereof, or change the time before which no such
redemption may be made;
(6) waive a default in the payment of the principal of, or interest
on, or redemption payment with respect to, any Note (including any
obligation to make a Change of Control Offer or, after the ' obligation to
purchase Notes arises thereunder, an Excess Proceeds Offer or modify any of
the provisions or definitions with respect to such offers);
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(7) make any changes in Sections 6.04 or 6.07 hereof or this sentence
of Section 8.02; or
(8) affect the ranking of the Notes or the Guarantee in a manner
adverse to the Holders.
After an amendment, supplement or waiver under this Section 8.02 or
Section 8.01 becomes effective, the Issuers shall mail to the Holders a notice
briefly describing the amendment, supplement or waiver.
Upon the written request of the Issuers, accompanied by a Board
Resolution authorizing the execution of any such supplemental indenture, and
upon the receipt by the Trustee of evidence reasonably satisfactory to the
Trustee of the consent of the Noteholders as aforesaid and upon receipt by the
Trustee of the documents described in Section 8.06 hereof, the Trustee shall
join with the Issuers and the Guarantors in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own rights,
duties or immunities under this Indenture, in which case the Trustee may, but
shall not be obligated to, enter into such supplemental 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.
Section 8.03. Compliance with Trust Indenture Act.
-----------------------------------
Every amendment to or supplement of this Indenture or the Notes shall
comply with the TIA as then in effect.
Section 8.04. Revocation and Effect of Consents.
---------------------------------
Until an amendment, supplement, waiver or other action becomes
effective, a consent to it by a Holder of a Note is a continuing consent
conclusive and binding upon such Holder and every subsequent Holder of the same
Note or portion thereof, and of any Note issued upon the transfer thereof or in
exchange therefor or in place thereof, even if notation of the consent is not
made on any such Note. Any such Holder or subsequent Holder, however, may
revoke the consent as to his Note or portion of a Note, if the Trustee receives
the written notice of revocation before the date the amendment, supplement,
waiver or other action becomes effective.
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The Issuers 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
preceding paragraph, those Persons who were Holders at such record date (or
their duly designated proxies), and only such Persons, shall be entitled to
consent to such amendment, supplement, or waiver or to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date unless the consent of the requisite number of Holders has
been obtained.
After an amendment, supplement, waiver or other action becomes
effective, it shall bind every Noteholder, unless it makes a change described in
any of clauses (1) through (8) of Section 8.02 hereof. In that case the
amendment, supplement, waiver or other action shall bind each Holder of a Note
who has consented to it and every subsequent Holder of a Note or portion of a
Note that evidences the same debt as the consenting Holder's Note.
Section 8.05. Notation on or Exchange of Notes.
--------------------------------
If an amendment, supplement, or waiver changes the terms of a Note,
the Trustee (in accordance with the specific written direction of the Issuers)
shall request the Holder of the Note (in accordance with the specific written
direction of the Issuers) to deliver it to the Trustee. In such case, the
Trustee shall place an appropriate notation on the Note about the changed terms
and return it to the Holder. Alternatively, if the Issuers or the Trustee so
determines, the Issuers in exchange for the Note shall issue, the Guarantors
shall endorse, and the Trustee shall authenticate a new Note that reflects the
changed terms. Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment supplement or waiver.
Section 8.06. Trustee to Sign Amendments, etc.
-------------------------------
The Trustee shall sign any amendment, supplement or waiver authorized
pursuant to this Article 8 if the amendment, supplement or waiver does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may, but need not, sign it. In signing or refusing to
sign such amendment, supplement or waiver the Trustee shall be entitled to
receive and, subject to Section 7.01 hereof, shall be fully protected in relying
upon an Officers' Certificate and an
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Opinion of Counsel stating that such amendment, supplement or waiver is
authorized or permitted by this Indenture and is a legal, valid and binding
obligation of the Issuers and Guarantors, enforceable against the Issuers and
Guarantors in accordance with its terms (subject to customary exceptions).
ARTICLE 9
DISCHARGE OF INDENTURE; DEFEASANCE
Section 9.01. Discharge of Indenture.
----------------------
The Issuers and the Guarantors may terminate their obligations under
the Notes, the Guarantees and this Indenture, except the obligations referred to
in the last paragraph of this Section 9.01, if there shall have been cancelled
by the Trustee or delivered to the Trustee for cancellation all Notes
theretofore authenticated and delivered (other than any Notes that are asserted
to have been destroyed, lost or stolen and that shall have been replaced as
provided in Section 2.07 hereof) and the Issuers have paid all sums payable by
them hereunder or deposited all required sums with the Trustee.
After such delivery the Trustee upon Issuer request shall acknowledge
in writing the discharge of the Issuers' and the Guarantors' obligations under
the Notes, the Guarantees and this Indenture except for those surviving
obligations specified below.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Issuers in Sections 7.07, 9.05 and 9.06 hereof shall survive.
Section 9.02. Legal Defeasance.
----------------
The Issuers may at their option, by Board Resolution of the Board of
Directors of each of the Issuers, be discharged from then obligations with
respect to the Notes and the Guarantors discharged from their obligations under
the Guarantees on the date the conditions set forth in Section 9.04 below are
satisfied (hereinafter, "Legal Defeasance"). For this purpose, such Legal
Defeasance means that the Issuers shall be deemed to have paid and discharged
the entire indebtedness represented by the Notes and to have satisfied all its
other obligations under such Notes and this Indenture insofar as such Notes are
concerned (and the Trustee, at the expense of the Issuers, shall, subject to
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Section 9.06 hereof, execute instruments in form and substance reasonably
satisfactory to the Trustee and Issuers acknowledging the same), except for the
following which shall survive until otherwise terminated or discharged
hereunder: (A) the rights of Holders of outstanding Notes to receive solely
from the trust funds described in Section 9.04 hereof and as more fully set
forth in such Section, payments in respect of the principal of, premium, if any,
and interest on such Notes when such payments are due, (B) the Issuers'
obligations with respect to such Notes under Sections 2.03, 2.04, 2.05, 2.06,
2.07, 2.08, 2.09 and 4.20 hereof, (C) the rights, powers, trusts, duties, and
immunities of the Trustee hereunder (including claims of, or payments to, the
Trustee under or pursuant to Section 7.07 hereof) and (D) this Article 9.
Subject to compliance with this Article 9, the Issuers may exercise their option
under this Section 9.02 with respect to the Notes notwithstanding the prior
exercise of its option under Section 9.03 below with respect to the Notes.
Section 9.03. Covenant Defeasance.
-------------------
At the option of the Issuers, pursuant to a Board Resolution of the
Board of Directors of each of the Issuers, the Issuers and the Guarantors shall
be released from their respective obligations under Sections 4.02 through 4.19
and Section 4.21 hereof, inclusive, and clause (a)(iii) of Section 5.01 hereof
with respect to the outstanding Notes on and after the date the conditions set
forth in Section 9.04 hereof are satisfied (hereinafter, "Covenant Defeasance").
For this purpose, such Covenant Defeasance means that the Issuers and the
Guarantors may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such specified Section or portion
thereof, whether directly or indirectly by reason of any reference elsewhere
herein to any such specified Section or portion thereof or by reason of any
reference in any such specified Section or portion thereof to any other
provision herein or in any other document, but the remainder of this Indenture
and the Notes shall be unaffected thereby.
Section 9.04. Conditions to Defeasance or Covenant
Defeasance.
------------------------------------
The following shall be the conditions to application of Section 9.02
or Section 9.03 hereof to the outstanding Notes:
(1) the Issuers shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10 hereof who shall
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agree to comply with the provisions of this Article 9 applicable to it) as
funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the benefit
of the Holders of the Notes, (A) money in an amount, or (B) U.S. Government
Obligations which through the scheduled payment of principal and interest
in respect thereof in accordance with their terms will provide, not later
than the due date of any payment, money in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, and which shall be applied
by the Trustee (or other qualifying trustee) to pay and discharge, the
principal of, premium, if any, and accrued interest on the outstanding
Notes at the maturity date of such principal, premium, if any, or interest,
or on dates for payment and redemption of such principal, premium, if any,
and interest selected in accordance with the terms of this Indenture and of
the Notes;
(2) no Event of Default or Default with respect to the Notes shall
have occurred and be continuing on the date of such deposit, or shall have
occurred and be continuing at any time during the period ending on the 91st
day after the date of such deposit or, if longer, ending on the day
following the expiration of the longest preference period under any
Bankruptcy Law applicable to the Issuers in respect of such deposit (it
being understood that this condition shall not be deemed satisfied until
the expiration of such period);
(3) such Legal Defeasance or Covenant Defeasance shall not cause the
Trustee to have a conflicting interest for purposes of the TIA with respect
to any securities of the Company;
(4) such Legal Defeasance or Covenant Defeasance shall not result in
a breach or violation of, or constitute default under any other agreement
or instrument to which the Issuers are a party or by which they are bound;
(5) the Issuers shall have delivered to the Trustee an Opinion of
Counsel stating that, as a result of such Legal Defeasance or Covenant
Defeasance, neither the trust nor the Trustee will be required to register
as an investment company under the Investment Company Act of 1940, as
amended;
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(6) in the case of an election under Section 9.02 above, the Issuers
shall have delivered to the Trustee an Opinion of Counsel stating that (i)
the Issuers have received from, or there has been published by, the
Internal Revenue Service a ruling to the effect that or (ii) there has been
a change in any applicable Federal income tax law with the effect that, and
such opinion shall confirm that, the Holders of the outstanding Notes or
persons in their positions will not recognize income, gain or loss for
Federal income tax purposes solely as a result of such Legal Defeasance and
will be subject to Federal income tax on the same amounts, in the same
manner, including as a result of prepayment, and at the same times as would
have been the case if such Legal Defeasance had not occurred;
(7) in the case of an election under Section 9.03 hereof, the Issuers
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of the outstanding Notes 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;
(8) the Issuers shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Legal Defeasance under
Section 9.02 above or the Covenant Defeasance under Section 9.03 hereof (as
the case may be) have been complied with;
(9) the Issuers shall have delivered to the Trustee an Officers'
Certificate stating that the deposit under clause (1) was not made by the
Issuers with the intent of defeating, hindering, delaying or defrauding any
creditors of the Company or others;
(10) the Issuers shall have paid or duly provided for payment under
terms mutually satisfactory to the Issuers and the Trustee all amounts then
due to the Trustee pursuant to Section 7.07 hereof; and
(11) the Issuers shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel (to the extent matters of law are
involved), each stating that (x) all conditions precedent herein provided
for relating to either the legal defeasance under paragraph 9.02 above or
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the covenant defeasance under paragraph 9.03 above, as the case may be,
have been complied with and (y) if any other Indebtedness of the Issuers
shall then be outstanding or committed, such legal defeasance or covenant
defeasance will not violate the provisions of the agreements or instruments
evidencing such Indebtedness.
Section 9.05. Deposited Money and U.S. Government
Obligations to Be Held in Trust; Other
Miscellaneous Provisions.
--------------------------------------
All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 9.04 hereof in respect
of the outstanding Notes shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Notes and this Indenture, to the payment,
either directly or through any Paying Agent, to the Holders of such Notes, of
all sums due and to become due thereon in respect of principal, premium, if any,
and accrued interest, but such money need not be segregated from other funds
except to the extent required by law.
The Issuers and the Guarantors shall (on a joint and several basis)
pay and indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the U.S. Government Obligations deposited pursuant to Section
9.04 hereof or the principal, premium, if any, and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of the outstanding Notes.
Anything in this Article 9 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuers from time to time upon an Issuer
Request any money or U.S. Government Obligations held by it as provided in
Section 9.04 hereof which, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Section 9.06. Reinstatement.
-------------
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 9.01, 9.02 or 9.03 hereof by
reason of any legal proceeding or by reason of any order or judgment of any
court or
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governmental authority enjoining, restraining or otherwise prohibiting such
application, the Issuers' and each Guarantor's obligations under this Indenture,
the Notes and the Guarantees shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 9 until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 9.01 hereof; provided, however, that if
-------- -------
the Issuers or the Guarantors have made any payment of principal of, premium, if
any, or accrued interest on any Notes because of the reinstatement of their
obligations, the Issuers or the Guarantors, as the case may be, shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money or U.S. Government Obligations held by the Trustee or Paying
Agent.
Section 9.07. Moneys Held by Paying Agent.
---------------------------
In connection with the satisfaction and discharge of this Indenture,
all moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon written demand of the Issuers, be paid to the Trustee, or if
sufficient moneys have been deposited pursuant to Section 9.01 hereof, to the
Issuers upon an Issuer Request (or, if such moneys had been deposited by the
Guarantors, to such Guarantors), and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
Section 9.08. Moneys Held by Trustee.
----------------------
Any moneys deposited with the Trustee or any Paying Agent or then held
by the Issuers or the Guarantors in trust for the payment of the principal of,
or premium, if any, or interest on any Note that are not applied but remain
unclaimed by the Holder of such Note for two years after the date upon which the
principal of, or premium, if any, or interest on such Note shall have
respectively become due and payable shall be repaid to the Issuers (or, if
appropriate, the Guarantors) upon an Issuer Request, or if such moneys are then
held by the Issuers or the Guarantors in trust, such moneys shall be released
from such trust; and the Holder of such Note entitled to receive such payment
shall thereafter, as an unsecured general creditor, look only to the Issuers and
the Guarantors for the payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money shall thereupon cease; provided,
--------
however, that the Trustee or any such Paying Agent, before being required to
- -------
make any such repayment, may, at the expense of the Issuers and the Guarantors,
either mail to each Noteholder affected, at the address shown in the register of
the Notes
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maintained by the Registrar pursuant to Section 2.03 hereof, or cause to be
published once a week for two successive weeks, in a newspaper published in the
English language, customarily published each Business Day and of general
circulation in the City of New York, New York, a notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such mailing or publication, any unclaimed balance of
such moneys then remaining will be repaid to the Issuers. After payment to the
Issuers or the Guarantors or the release of any money held in trust by the
Issuers or any Guarantors, as the case may be, Noteholders entitled to the money
must look only to the Issuers and the Guarantors for payment as general
creditors unless applicable abandoned property law designates another person.
ARTICLE 10
GUARANTEE OF NOTES
Section 10.01. Guarantee.
---------
Subject to the provisions of this Article 10, each Guarantor hereby
jointly and severally unconditionally guarantees to each Holder and to the
Trustee, (i) the due and punctual payment of the principal of, and premium, if
any, and interest on each Note, when and as the same shall become due and
payable, whether at maturity, by acceleration or otherwise, the due and punctual
payment of interest (including Additional Interest) on the overdue principal of,
and premium, if any, and interest on the Notes, to the extent lawful, and the
due and punctual performance of all other Obligations of the Issuers to the
Holders or the Trustee (including without limitation amounts due the Trustee
under Section 7.07) all in accordance with the terms of such Note and this
Indenture, and (ii) in the case of any extension of time of payment or renewal
of any Notes or any of such other Obligations, that the same will be promptly
paid in full when due or performed in accordance with the terms of the extension
or renewal, at stated maturity, by acceleration or otherwise. Each Guarantor
hereby agrees that its obligations hereunder shall be absolute and
unconditional, irrespective of, and shall be unaffected by, any invalidity,
irregularity or unenforceability of any such Note or this Indenture, any failure
to enforce the provisions of any such Note or this Indenture, any waiver,
modification or indulgence granted to the Issuers with respect thereto by the
Holder of such Note or the Trustee, or any
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other circumstances which may otherwise constitute a legal or equitable
discharge of a surety or such Guarantor.
Each Guarantor hereby waives diligence, presentment, demand for
payment, filing of claims with a court in the event of merger or bankruptcy of
the Issuers, any right to require a proceeding first against the Issuers,
protest or notice with respect to any such Note or the Indebtedness evidenced
thereby and all demands whatsoever, and covenants that this Guarantee will not
be discharged as to any such Note except by payment in full of the principal
thereof, premium if any, and interest thereon and as provided in Section 9.01
hereof. Each Guarantor further agrees that, as between such Guarantor, on the
one hand, and the Holders and the Trustee, on the other hand, (i) the maturity
of the Obligations guaranteed hereby may be accelerated as provided in Article 6
hereof for the purposes of this Guarantee, notwithstanding any stay, injunction
or other prohibition preventing such acceleration in respect of the Obligations
guaranteed hereby, and (ii) in the event of any declaration of acceleration of
such Obligations as provided in Article 6 hereof, such Obligations (whether or
not due and payable) shall forthwith become due and payable by each Guarantor
for the purpose of this Guarantee. In addition, without limiting the foregoing
provisions, upon the effectiveness of an acceleration under Article 6 hereof,
the Trustee shall promptly make a demand for payment on the Notes under the
Guarantee provided for in this Article 10 and not discharged.
The Guarantee set forth in this Section 10.01 shall not be valid or
become obligatory for any purpose with respect to a Note until the certificate
of authentication on such Note shall have been signed by or on behalf of the
Trustee by its manual signature.
Section 10.02. Execution and Delivery of Guarantees.
------------------------------------
To evidence the Guarantee set forth in this Article 10, each Guarantor
hereby agrees that a notation of such Guarantee substantially in the form
included in Exhibit E hereto shall be placed on each Note authenticated and made
available for delivery by the Trustee and that this Guarantee shall be executed
on behalf of each Guarantor by the manual or facsimile signature of an Officer
of each Guarantor.
Each Guarantor hereby agrees that the Guarantee set forth in Section
10.01 shall remain in full force and effect notwithstanding any failure to
endorse on each Note a notation of such Guarantee.
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If an Officer of a Guarantor whose signature is on the Guarantee no
longer holds that office at the time the Trustee authenticates the Note on which
the Guarantee is endorsed, the Guarantee shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
this Indenture on behalf of each Guarantor.
Section 10.03. Limitation of Guarantee.
-----------------------
The obligations of each Guarantor are limited to the maximum amount as
will, after giving effect to all other contingent and fixed liabilities of such
Guarantor (including, without limitation, any guarantees of Senior Indebtedness)
and after giving effect to any collections from or payments made by or on behalf
of any other Guarantor in respect of the obligations of such other Guarantor
under its Guarantee or pursuant to its contribution obligations under this
Indenture, 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 a pro
rata amount based on the Adjusted Net Assets of each Guarantor.
Section 10.04. Additional Guarantors.
---------------------
The Issuers covenant and agree that they will cause any Person which
becomes obligated to guarantee the Notes, pursuant to the terms of Section 4.14
hereof, to execute a guarantee satisfactory in form and substance to the Trustee
pursuant to which such Restricted Subsidiary shall guarantee the obligations of
the Issuers under the Notes and this Indenture in accordance with this Article
10 with the same effect and to the same extent as if such Person had been named
herein as a Guarantor.
Section 10.05. Release of Guarantor.
--------------------
A Guarantor shall be released from all of its obligations under its
Guarantee if:
(i) the Guarantor has sold all or substantially all of its assets or
the Company and its Restricted Subsidiaries have sold all of the Capital
Stock of the Guarantor owned by them, in each case in a transaction in
compliance with Sections 4.10 and 5.01 hereof; or
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(ii) the Guarantor merges with or into or consolidates with, or
transfers all or substantially all of its assets to, the Company or another
Guarantor in a transaction in compliance with Section 5.01 hereof;
and in each such case, such Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to such transactions have been complied
with.
Section 10.06. Guarantee Obligations Subordinated
to Guarantor Senior Indebtedness.
----------------------------------
Each Guarantor covenants and agrees, and each Holder of Notes, by its
acceptance thereof, likewise covenants and agrees, that to the extent and in the
manner hereinafter set forth in this Article 10, the Indebtedness represented by
the Guarantee and the payment of the principal of, premium, if any, and interest
on the Notes pursuant to the Guarantee by such Guarantor are hereby expressly
made subordinate and subject in right of payment as provided in this Article 10
to the prior payment in full in cash of all existing and future Guarantor Senior
Indebtedness of such Guarantor.
This Section 10.06 and the following Sections 10.07 through 10.11 shall
constitute a continuing offer to all Persons who, in reliance upon such
provisions, become holders of or continue to hold Guarantor Senior Indebtedness
of any Guarantor; and such provisions are made for the benefit of the holders of
Guarantor Senior Indebtedness of each Guarantor; and such holders are made
obligees hereunder and they or each of them may enforce such provisions.
Section 10.07. Payment Over of Proceeds upon
Dissolution, etc., of a Guarantor.
---------------------------------
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding in
connection therewith, relative to any Guarantor or to its creditors, as such, or
to its assets, whether voluntary or involuntary, or (b) any liquidation,
dissolution or other winding-up of any Guarantor, whether voluntary or
involuntary and whether or not involving insolvency or bankruptcy or (c) any
general assignment for the benefit of creditors or any other marshaling of
assets or liabilities of any Guarantor (except in connection with the merger or
consolidation of the Issuers or its liquidation or dissolution following the
transfer of substantially all of its assets, upon the terms and
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conditions permitted under the circumstances described under Section 5.01), then
and in any such event:
(1) the holders of all Guarantor Senior Indebtedness of such
Guarantor shall be entitled to receive payment in full in cash of all
amounts due on or in respect of all such Guarantor Senior Indebtedness
before the Holders of the Notes are entitled to receive or retain, pursuant
to the Guarantee of such Guarantor, any payment or distribution of any kind
or character by such Guarantor on account of any of its Obligations on its
Guarantee; and
(2) any payment or distribution of assets of such Guarantor of any
kind or character, whether in cash, property or securities, by set-off or
otherwise, to which the Holders or the Trustee would be entitled but for
the subordination provisions of this Article 10 shall be paid by the
liquidating trustee or agent or other Person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or liquidating
trustee or otherwise, directly to the holders of Guarantor Senior
Indebtedness of such Guarantor or their representative or representatives
or to the trustee or trustees under any indenture under which any
instruments evidencing any of such Guarantor Senior Indebtedness may have
been issued, ratably according to the aggregate amounts remaining unpaid on
account of such Guarantor Senior Indebtedness held or represented by each,
to the extent necessary to make payment in full in cash of all such
Guarantor Senior Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution, or provision thereof, to the holders of
such Guarantor Senior Indebtedness; and
(3) in the event that, notwithstanding the foregoing provisions of
this Section 10.07, the Trustee or the Holder of any Note shall have
received any payment or distribution of assets of such Guarantor of any
kind or character, whether in cash, property or securities, including,
without limitation, by way of set-off or otherwise, in respect of any of
its Obligations on its Guarantee before all Guarantor Senior Indebtedness
of such Guarantor is paid and satisfied in full in cash then in such event
such payment or distribution shall be paid over or delivered forthwith to
the trustee in bankruptcy, receiver, liquidating trustee, custodian,
assignee, agent or other Person making payment or distribution of assets of
such Guarantor for application to the payment of all such Guarantor Senior
Indebtedness remaining unpaid, to the extent necessary to pay all of such
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Guarantor Senior Indebtedness in full in cash after giving effect to any
concurrent payment or distribution to or for the holders of such Guarantor
Senior Indebtedness.
The consolidation of a Guarantor with, or the merger of a Guarantor
with or into, another Person or the liquidation or dissolution of a Guarantor
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article 5 hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshaling of assets and liabilities of such Guarantor for the purposes of this
Article 10 if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, comply
with the conditions set forth in such Article 5 hereof.
Section 10.08. Suspension of Guarantee Obligations
When Guarantor Senior Indebtedness
in Default.
-----------------------------------
(a) Unless Section 10.07 hereof shall be applicable, after the
occurrence of a Payment Default no payment or distribution of any assets or
securities of a Guarantor (or any Restricted Subsidiary or Subsidiary of such
Guarantor) of any kind or character (including, without limitation, cash,
property and any payment or distribution which may be payable or deliverable by
reason of the payment of any other Indebtedness of such Guarantor being
subordinated to its Obligations on its Guarantee) may be made by or on behalf of
such Guarantor (or any Restricted Subsidiary or Subsidiary of such Guarantor),
including, without limitation, by way of set-off or otherwise, for or on account
of its Obligations on its Guarantee, and neither the Trustee nor any holder or
owner of any Notes shall take or receive from any Guarantor (or any Restricted
Subsidiary or Subsidiary of such Guarantor), directly or indirectly in any
manner, payment in respect of all or any portion of its Obligations on its
Guarantee following the delivery by the representative of the holders of
Guarantor Senior Indebtedness (the "Guarantor Representative") to the Trustee of
written notice of the occurrence of a Payment Default, and in any such event,
such prohibition shall continue until such Payment Default is cured, waived in
writing or ceases to exist. At such time as the prohibition set forth in the
preceding sentence shall no longer be in effect, subject to the provisions of
the following
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paragraph (b), such Guarantor shall resume making any and all required payments
in respect of its Obligations under its Guarantee.
(b) Unless Section 10.07 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on Designated Senior Indebtedness,
no payment or distribution of any assets of such Guarantor of any kind or
character shall be made by such Guarantor, including, without limitation, by way
of set-off or otherwise, on account of any of its Obligations on its Guarantee
for a period (the "Guarantee Payment Blockage Period") commencing on the date of
receipt by the Trustee of written notice from the Guarantor Representative of
such Non-Payment Event of Default, unless and until (subject to any blockage of
payments that may then be in effect under the preceding paragraph (a)) the
earliest to occur of the following events: (w) more than 179 days shall have
elapsed since the date of receipt of such written notice by the Trustee, (x)
such Non-Payment Event of Default shall have been cured or waived in writing or
shall have ceased to exist, (y) such Designated Senior Indebtedness shall have
been discharged or paid in full in cash or (z) such Guarantee Payment Blockage
Period shall have been terminated by written notice to such Guarantor or the
Trustee from the Guarantor Representative initiating such Guarantee Payment
Blockage Period, or the holders of at least a majority in principal amount of
such issue of Designated Senior Indebtedness, after which, in the case of clause
(w), (x), (y) or (z), such Guarantor shall resume making any and all required
payments in respect of its Obligations on its Guarantee. Notwithstanding any
other provisions of this Indenture, no Non-Payment Event of Default with respect
to Designated Senior Indebtedness which existed or was continuing on the date of
the commencement of any Guarantee Payment Blockage Period initiated by the
Guarantor Representative shall be, or be made, the basis for the commencement of
a second Guarantee Payment Blockage Period initiated by the Guarantor
Representative unless such event of default shall have been cured or waived for
a period of not less than 90 consecutive days. In no event shall a Guarantee
Payment Blockage Period extend beyond 179 days from the date of the receipt by
the Trustee of the notice referred to in this Section 10.08(b) or, in the event
of a Non-Payment Event of Default which formed the basis for a Payment Blockage
Period under Section 11.03(b) hereof, 179 days from the date of the receipt by
the Trustee of the notice referred to in Section 11.03(b) (the "Initial
Guarantee Blockage Period"). Any number of additional Guarantee Payment
Blockage Periods may be commenced during the Initial Guarantee Blockage Period;
provided, however, that no such additional Guarantee Payment Blockage Period
- -------- -------
shall extend
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beyond the Initial Guarantee Blockage Period. After the expiration
of the Initial Guarantee Blockage Period, no Guarantee Payment Blockage Period
may be commenced under this Section 10.08(b) and no Payment Blockage Period may
be commenced under Section 11.03(b) hereof until at least 180 consecutive days
have elapsed from the last day of the Initial Guarantee Blockage Period.
(c) In the event that, notwithstanding the foregoing, the Trustee or
the Holder of any Note shall have received any payment from a Guarantor
prohibited by the foregoing provisions of this Section 10.08, then and in such
event such payment shall be paid over and delivered forthwith to the Guarantor
Representative initiating the Guarantee Payment Blockage Period, in trust for
distribution to the holders of Guarantor Senior Indebtedness or, if no amounts
are then due in respect of Guarantor Senior Indebtedness, promptly returned to
the Guarantor, or as a court of competent jurisdiction shall direct.
Section 10.09. Subrogation to Rights of Holders
of Guarantor Senior Indebtedness.
--------------------------------
Upon the payment in full of all amounts payable under or in respect of
all Guarantor Senior Indebtedness of a Guarantor, the Holders shall be
subrogated to the rights of the holders of such Guarantor Senior Indebtedness to
receive payments and distributions of cash, property and securities of such
Guarantor made on such Guarantor Senior Indebtedness until all amounts due to be
paid under the Guarantee shall be paid in full. For the purposes of such
subrogation, no payments or distributions to holders of Guarantor Senior
Indebtedness of any cash, property or securities to which Holders of the Notes
or the Trustee would be entitled except for the provisions of this Article 10,
and no payments over pursuant to the provisions of this Article 10 to holders of
Guarantor Senior Indebtedness by Holders of the Notes or the Trustee, shall, as
among each Guarantor, its creditors other than holders of Guarantor Senior
Indebtedness and the Holders of the Notes, be deemed to be a payment or
distribution by such Guarantor to or on account of such Guarantor Senior
Indebtedness.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 10 shall have been
applied, pursuant to the provisions of this Article 10, to the payment of all
amounts payable under Guarantor Senior Indebtedness, then and in such case, the
Holders shall be entitled to receive from the holders of such Guarantor Senior
Indebtedness at the time outstanding any payments or
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distributions received by such holders of Guarantor Senior Indebtedness in
excess of the amount sufficient to pay all amounts payable under or in respect
of such Guarantor Senior Indebtedness in full in cash or Cash Equivalents.
Section 10.10. Guarantee Subordination Provisions
Solely to Define Relative Rights.
----------------------------------
The subordination provisions of this Article 10 are and are intended
solely for the purpose of defining the relative rights of the Holders of the
Notes on the one hand and the holders of Guarantor Senior Indebtedness on the
other hand. Nothing contained in this Article 10 or elsewhere in this Indenture
or in the Notes is intended to or shall (a) impair, as among each Guarantor, its
creditors other than holders of its Guarantor Senior Indebtedness and the
Holders of the Notes, the obligation of such Guarantor, which is absolute and
unconditional, to make payments to the Holders in respect of its Obligations on
its Guarantee in accordance with its terms; or (b) affect the relative rights
against such Guarantor of the Holders of the Notes and creditors of such
Guarantor other than the holders of the Guarantor Senior Indebtedness; or (c)
prevent the Trustee or the Holder of any Note from exercising all remedies
otherwise permitted by applicable law upon a Default or an Event of Default
under this Indenture, subject to the rights, if any, under this Article 10 of
the holders of Guarantor Senior Indebtedness (1) in any case, proceeding,
dissolution, liquidation or other winding-up, assignment for the benefit of
creditors or other marshaling of assets and liabilities of the Issuers referred
to in Section 10.07 hereof, to receive, pursuant to and in accordance with such
Section, cash, property and securities otherwise payable or deliverable to the
Trustee or such Holder, or (2) under the conditions specified in Section 10.08
hereof, to prevent any payment prohibited by such Section or enforce their
rights pursuant to Section 10.08(c) hereof.
The failure by any Guarantor to make a payment in respect of its
obligations on its Guarantee by reason of any provision of this Article 10 shall
not be construed as preventing the occurrence of a Default or an Event of
Default hereunder.
Section 10.11. Application of Certain
Article 11 Provisions.
----------------------
The provisions of Sections 11.04, 11.07, 11.08, 11.09, 11.10, 11.12
and 11.13 hereof shall apply, mutatis mutandis, to each Guarantor and their
------- --------
respective holders of Guarantor Senior Indebtedness and the rights, duties and
obligations set forth
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therein shall govern the rights, duties and obligations of each Guarantor, the
holders of Guarantor Senior Indebtedness, the Holders and the Trustee with
respect to the Guarantee and all references therein to Article 11 hereof shall
mean this Article 10.
ARTICLE 11
SUBORDINATION OF NOTES
Section 11.01. Notes Subordinate to Senior Indebtedness.
----------------------------------------
The Issuers covenant and agree, and each Holder of Notes, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article 11, the Indebtedness
represented by the Notes and the payment of the principal of, premium, if any,
and interest on the Notes are hereby expressly made subordinate and subject in
right of payment as provided in this Article 11 to the prior indefeasible
payment in full in cash of all existing and future Senior Indebtedness.
This Article 11 shall constitute a continuing offer to all Persons
who, in reliance upon such provisions, become holders of or continue to hold
Senior Indebtedness; and such provisions are made for the benefit of the holders
of Senior Indebtedness; and such holders are made obligees hereunder and they or
each of them may enforce such provisions.
Section 11.02. Payment Over of Proceeds upon
Dissolution, etc.
-----------------------------
In the event of (a) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, arrangement, reorganization or other similar
case or proceeding in connection therewith, relative to the Issuers or to their
creditors, as such, or to its assets, whether voluntary or involuntary or (b)
any liquidation, dissolution or other winding-up of the Issuers, whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy,
or (c) any general assignment for the benefit of creditors or any other
marshalling of assets or liabilities of the Issuers, (except in connection with
the merger or consolidation of the Issuers or its liquidation or dissolution
following the transfer of substantially all of its assets, upon the terms and
conditions permitted under the
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circumstances described under Section 5.01) then and in any such event:
(1) the holders of Senior Indebtedness shall be entitled to receive
payment in full in cash of all amounts due on or in respect of all Senior
Indebtedness before the Holders of the Notes are entitled to receive or
retain any payment or distribution of any kind or character on account of
principal of, premium, if any, or interest on the Notes; and
(2) any payment or distribution of assets of the Issuers of any kind
or character, whether in cash, property or securities, by set-off or
otherwise, to which the Holders or the Trustee would be entitled but for
the provisions of this Article 11 shall be paid by the liquidating trustee
or agent or other Person making such payment or distribution, whether a
trustee in bankruptcy, a receiver or liquidating trustee or otherwise,
directly to the holders of Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture under
which any instruments evidencing any of such Senior Indebtedness may have
been issued, ratably according to the aggregate amounts remaining unpaid on
account of the Senior Indebtedness held or represented by each, to the
extent necessary to make payment in full in cash of all Senior Indebtedness
remaining unpaid, after giving effect to any concurrent payment or
distribution, or provision therefor, to the holders of such Senior
Indebtedness; and
(3) in the event that, notwithstanding the foregoing provisions of
this Section 11.02, the Trustee or the Holder of any Note shall have
received any payment or distribution of assets of the Issuers of any kind
or character, whether in cash, property or securities, including, without
limitation, by way of set-off or otherwise, in respect of principal of,
premium, if any, and interest on the Notes before all Senior Indebtedness
is paid and satisfied in full in cash then in such event such payment or
distribution shall be paid over or delivered forthwith to the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee, agent or
other Person making payment or distribution of assets of the Issuers for
application to the payment of all Senior Indebtedness remaining unpaid, to
the extent necessary to pay all Senior Indebtedness in full in cash after
giving effect to any concurrent payment or distribution, or provision
therefor, to or for the holders of Senior Indebtedness.
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The consolidation of the Issuers with, or the merger of the Issuers
with or into, another Person or the liquidation or dissolution of the Issuers
following the conveyance, transfer or lease of its properties and assets
substantially as an entirety to another Person upon the terms and conditions set
forth in Article 5 hereof shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshaling of assets and liabilities of the Issuers for the purposes of this
Article 11 if the Person formed by such consolidation or the surviving entity of
such merger or the Person which acquires by conveyance, transfer or lease such
properties and assets substantially as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance, transfer or lease, comply
with the conditions set forth in such Article 5 hereof.
Section 11.03. Suspension of Payment When Senior
Indebtedness in Default.
---------------------------------
(a) Unless Section 11.02 hereof shall be applicable, after the
occurrence of a Payment Default no payment or distribution of any assets or
securities of the Issuers or any Restricted Subsidiary of any kind or character
(including, without limitation, cash, property and any payment or distribution
which may be payable or deliverable by reason of the payment of any other
Indebtedness of the Issuers being subordinated to the payment of the Notes by
the Issuers) may be made by or on behalf of the Issuers or any Restricted
Subsidiary, including, without limitation, by way of set-off or otherwise, for
or on account of principal of, premium, if any, or interest on the Notes, or for
or on account of the purchase, redemption or other acquisition of the Notes, and
neither the Trustee nor any holder or owner of any Notes shall take or receive
from the Issuers or any Restricted Subsidiary, directly or indirectly in any
manner, payment in respect of all or any portion of Notes following the delivery
by the representative of the holders of Designated Senior Indebtedness (the
"Representative") to the Trustee of written notice of the occurrence of a
Payment Default, and in any such event, such prohibition shall continue until
such Payment Default is cured, waived in writing or ceases to exist. At such
time as the prohibition set forth in the preceding sentence shall no longer be
in effect, subject to the provisions of the following paragraph (b), the Issuers
shall resume making any and all required payments in respect of the Notes,
including any missed payments.
(b) Unless Section 11.02 hereof shall be applicable, upon the
occurrence of a Non-Payment Event of Default on
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Designated Senior Indebtedness, no payment or distribution of any assets of the
Issuers of any kind or character shall be made by the Issuers, including,
without limitation, by way of set-off or otherwise, on account of any principal
of, premium, if any, or interest on the Notes or on account of the purchase,
redemption, defeasance or other acquisition of Notes and neither the Trustee nor
any holder or owner of Notes shall take or receive from the issuers or any
Restricted Subsidiary, directly or indirectly in any manner, payment in respect
of all or any portion of the Notes for a period (a "Payment Blockage Period")
commencing on the date of receipt by the Trustee of written notice from the
Representative of such Non-Payment Event of Default unless and until (subject to
any blockage of payments that may then be in effect under the preceding
paragraph (a)) the earliest to occur of the following events: (w) more than 179
days shall have elapsed since the date of receipt of such written notice by the
Trustee, (x) such Non-Payment Event of Default shall have been cured or waived
in writing or shall have ceased to exist, (y) such Designated Senior
Indebtedness shall have been discharged or paid in full in cash or (z) such
Payment Blockage Period shall have been terminated by written notice to the
Issuers or the Trustee from the Representative initiating such Payment Blockage
Period, or the holders of at least a majority in principal amount of such issue
of Designated Senior Indebtedness, after which, in the case of clause (w), (x),
(y) or (z), the Issuers shall resume making any and all required payments in
respect of the Notes, including any missed payments. Notwithstanding any other
provisions of this Indenture, no Non-Payment Event of Default with respect to
Designated Senior Indebtedness which existed or was continuing on the date of
the commencement of any Payment Blockage Period initiated by the Representative
shall be, or be made, the basis for the commencement of a second Payment
Blockage Period initiated by the Representative unless such event of default
shall have been cured or waived for a period of not less than 90 consecutive
days. In no event shall a Payment Blockage Period extend beyond 179 days from
the date of the receipt by the Trustee of the notice referred to in this Section
11.03(b) (the "Initial Blockage Period"). Any number of additional Payment
Blockage Periods may be commenced during the Initial Blockage Period; provided,
--------
however, that no such additional Payment Blockage Period shall extend beyond the
- -------
Initial Blockage Period. After the expiration of the Initial Blockage Period, no
Payment Blockage Period may be commenced under this Section 11.03(b) and no
Guarantee Payment Blockage Period may be commenced under Section 10.08(b) hereof
until at least 180 consecutive days have elapsed from the last day of the
Initial Blockage Period.
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(c) In the event that, notwithstanding the foregoing, the Trustee or
the Holder of any Note shall have received any payment prohibited by the
foregoing provisions of this Section 11.03, then and in such event such payment
shall be paid over and delivered forthwith to the Representative initiating the
Payment Blockage Period, in trust for distribution to the holders of Senior
Indebtedness or, if no amounts are then due in respect of Senior Indebtedness,
promptly returned to the Issuers, or otherwise as a court of competent
jurisdiction shall direct.
Section 11.04. Trustee's Relation to Senior
Indebtedness.
----------------------------
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article 11, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and the Trustee shall
not be liable to any holder of Senior Indebtedness if it shall mistakenly pay
over or deliver to Holders, the Issuers or any other Person moneys or assets to
which any holder of Senior Indebtedness shall be entitled by virtue of this
Article 11 or otherwise.
Section 11.05. Subrogation to Rights of Holders
of Senior Indebtedness.
--------------------------------
Upon the payment in full of all Senior Indebtedness, the Holders of
the Notes shall be subrogated to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of,
premium, if any and interest on the Notes shall be paid in full. For purposes
of such subrogation, no payments or distributions to the holders of Senior
Indebtedness of any cash, property or securities to which the Holders of the
Notes or the Trustee would be entitled except for the provisions of this Article
11, and no payments over pursuant to the provisions of this Article 11 to the
holders of Senior Indebtedness by Holders of the Notes or the Trustee, shall, as
among the Issuers, their creditors other than holders of Senior Indebtedness and
the Holders of the Notes, be deemed to be a payment or distribution by the
Issuers to or on account of the Senior Indebtedness.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this
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Article 11 shall have been applied, pursuant to the provisions of this Article
11, to the payment of all amounts payable under the Senior Indebtedness of the
Issuers, then and in such case the Holders shall be entitled to receive from the
holders of such Senior Indebtedness at the time outstanding any payments or
distributions received by such holders of such Senior Indebtedness in excess of
the amount sufficient to pay all amounts payable under or in respect of such
Senior Indebtedness in full in cash or Cash Equivalents.
Section 11.06. Provisions Solely to Define Relative
Rights.
------------------------------------
The provisions of this Article 11 are and are intended solely for the
purpose of defining the relative rights of the Holders of the Notes on the one
hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in the Notes is
intended to or shall (a) impair, as among the Issuers, their creditors other
than holders of Senior Indebtedness and the Holders of the Notes, the obligation
of the Issuers, which is absolute and unconditional, to pay to the Holders of
the Notes the principal of, premium, if any, and interest on the Notes as and
when the same shall become due and payable in accordance with their terms; or
(b) affect the relative rights against the Issuers of the Holders of the Notes
and creditors of the Issuers other than the holders of Senior Indebtedness; or
(c) prevent the Trustee or the Holder of any Note from exercising all remedies
otherwise permitted by applicable law upon a Default or an Event of Default
under this Indenture, subject to the rights, if any, under this Article 11 of
the holders of Senior Indebtedness (1) in any case, proceeding, dissolution,
liquidation or other winding-up, assignment for the benefit of creditors or
other marshaling of assets and liabilities of the Issuers referred to in Section
11.02 hereof, to receive, pursuant to and in accordance with such Section, cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder, or (2) under the conditions specified in Section 11.03, to prevent any
payment prohibited by such Section or enforce their rights pursuant to Section
11.03(c) hereof.
The failure to make a payment on account of principal of, premium, if
any, or interest on the Notes by reason of any provision of this Article 11
shall not be construed as preventing the occurrence of a Default or an Event of
Default hereunder.
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Section 11.07. Trustee to Effectuate Subordination.
-----------------------------------
Each Holder of a Note by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the subordination provided in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes, including, in the
event of any dissolution, winding-up, liquidation or reorganization of the
Issuers whether in bankruptcy, insolvency, receivership proceedings, or
otherwise, the timely filing of a claim for the unpaid balance of the
indebtedness of the Issuers owing to such Holder in the form required in such
proceedings and the causing of such claim to be approved. If the Trustee does
not file such a claim prior to 30 days before the expiration of the time to file
such a claim, the holders of Senior Indebtedness, or any Representative, may
file such a claim on behalf of Holders of the Notes.
Section 11.08. No Waiver of Subordination
Provisions.
--------------------------
(a) No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Issuers or by any act or failure to act, in good faith, by any such holder,
or by any non-compliance by the Issuers with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof any such holder may have
or be otherwise charged with.
(b) Without limiting the generality of subsection (a) of this Section
11.08, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Notes, without incurring responsibility to the Holders of the Notes and without
impairing or releasing the subordination provided in this Article 11 or the
obligations hereunder of the Holders of the Notes to the holders of Senior
Indebtedness, do any one or more of the following: (1) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter, Senior
Indebtedness or any instrument evidencing the same or any agreement under which
Senior Indebtedness is outstanding; (2) sell, exchange, release or otherwise
deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (3) release any Person liable in any manner for the collection or
payment of Senior Indebtedness; and (4) exercise or refrain from exercising any
rights against the Issuers and any other Person; provided, however, that in no
-------- -------
event shall any such actions limit the right
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of the Holders of the Notes to take any action to accelerate the maturity of the
Notes pursuant to Article 6 hereof or to pursue any rights or remedies hereunder
or under applicable laws if the taking of such action does not otherwise violate
the terms of this Indenture.
Section 11.09. Notice to Trustee.
-----------------
(a) The Issuers shall give prompt written notice to the Trustee of
any fact known to the Issuers which would prohibit the making of any payment to
or by the Trustee at its Corporate Trust Office in respect of the Notes.
Notwithstanding the provisions of this Article 11 or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any facts which would prohibit the making of any payment to or by the Trustee in
respect of the Notes, unless and until the Trustee shall have received written
notice thereof from the Issuers or a holder of Senior Indebtedness or from any
trustee, fiduciary or agent therefor; and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of this Section 11.09,
shall be entitled in all respects to assume that no such facts exist; provided,
--------
however, that if the Trustee shall not have received the notice provided for in
- -------
this Section 11.09 at least five Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose under this
Indenture (including, without limitation, the payment of the principal of,
premium, if any, or interest on any Note), then, anything herein contained to
the contrary notwithstanding but without limiting the rights and remedies of the
holders of Senior Indebtedness or any trustee, fiduciary or agent therefor, the
Trustee shall have full power and authority to receive such money and to apply
the same to the purpose for which such money was received and shall not be
affected by any notice to the contrary which may be received by it within five
Business Days prior to such date; nor shall the Trustee be charged with
knowledge of the curing of any such default or the elimination of the act or
condition preventing any such payment unless and until the Trustee shall have
received an Officers' Certificate to such effect.
(b) Subject to the provisions of Section 7.01 hereof, the Trustee
shall be entitled to rely on the delivery to it of a written notice to the
Trustee and the Issuers by a Person representing itself to be a holder of Senior
Indebtedness (or a trustee, fiduciary or agent therefor) to establish that such
notice has been given by a holder of Senior Indebtedness (or a trustee,
fiduciary or agent therefor); provided, however, that failure to give such
-------- -------
notice to the Issuers shall not affect in
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any way the ability of the Trustee to rely on such notice. In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of Senior Indebtedness to participate in
any payment or distribution pursuant to this Article 11, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of Senior Indebtedness held by such Person, the extent to which
such Person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this Article 11, and if
such evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 11.10. Reliance on Judicial Order or
Certificate of Liquidating Agent.
--------------------------------
Upon any payment or distribution of assets of the Issuers referred to
in this Article 11, the Trustee, subject to the provisions of Section 7.01
hereof, and the Holders shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding-up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, the holders of
Senior Indebtedness and other Indebtedness of the Issuers, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 11; provided that the foregoing shall
--------
apply only if such court has been fully apprised of the provisions of this
Article 11.
Section 11.11. Rights of Trustee as a Holder of
Senior Indebtedness; Preservation
of Trustee's Rights.
---------------------------------
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article 11 with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder. Nothing in this Article 11 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 7.07 hereof.
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Section 11.12. Article Applicable to Paying Agents.
-----------------------------------
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Issuers and be then acting hereunder, the term "Trustee"
as used in this Article 11 shall in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article 11 in addition to or in place of the Trustee.
Section 11.13. No Suspension of Remedies.
-------------------------
Nothing contained in this Article 11 shall limit the right of the
Trustee or the Holders of Notes to take any action to accelerate the maturity of
the Notes pursuant to Article 6 or to pursue any rights or remedies hereunder or
under applicable law, subject to the rights, if any, under this Article 11 of
the holders, from time to time, of Senior Indebtedness.
ARTICLE 12
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
Section 12.02. Notices.
-------
Except for notice or communications to Holders any notice or
communication shall be given in writing and delivered in person, sent by
facsimile, delivered by commercial courier service or mailed by first-class
mail, postage prepaid, addressed as follows:
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If to the Issuers or any Guarantor:
Petersen Publishing Company, L.L.C.
6420 Wilshire Boulevard
Los Angeles, California 90048
Attention: Executive Vice President-Chief Financial Officer
Fax Number:
Copy to:
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: John A. Weissenbach, Esq.
If to the Trustee:
United States Trust Company of New York
114 West 47th Street
New York, New York 10036
Attention: Corporate Trust Department
Fax Number: (212) 852-1625
Copy to:
Kramer, Levin, Naftalis & Frankel
919 Third Avenue
New York, New York 10022
Attention: Michele D. Ross
Fax Number: (212) 715-8000
Such notices or communications shall be effective when received and
shall be sufficiently given if so given within the time prescribed in this
Indenture.
The Issuers, the Guarantors or the Trustee by written notice to the
others may designate additional or different addresses for subsequent notices or
communications.
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Any notice or communication mailed to a Noteholder shall be mailed to
him by first-class mail, postage prepaid, at his address shown on the register
kept by the Registrar.
Failure to mail a notice or communication to a Noteholder or any
defect in it shall not affect its sufficiency with respect to other Noteholders.
If a notice or communication to a Noteholder is mailed in the manner provided
above, it shall be deemed duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice as required
by this Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
Section 12.03. Communications by Holders with Other Holders.
--------------------------------------------
Noteholders may communicate pursuant to TIA (S) 312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes. The
Issuers, the Guarantors, the Trustee, the Registrar and anyone else shall have
the protection of TIA (S) 312(c).
Section 12.04. Certificate and Opinion as to Conditions
Precedent.
----------------------------------------
Upon any request or application by the Issuers or any Guarantor to the
Trustee to take any action under this Indenture, the Issuers or such Guarantor
shall furnish to the Trustee:
(1) an Officers' Certificate (which shall include the statements set
forth in Section 12.05 below) stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel (which shall include the statements set
forth in Section 12.05 below) stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
Section 12.05. Statements Required in Certificate and Opinion.
----------------------------------------------
Each certificate and opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
-110-
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, it or he has
made such examination or investigation as is necessary to enable it or him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such Person,
such covenant or condition has been complied with.
Section 12.06. When Treasury Notes Disregarded.
-------------------------------
In determining whether the Holders of the required aggregate principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Issuers, any Guarantor or any other obligor on the Notes or by any
Affiliate of any of them 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 Notes as to which a Responsible Officer of
the Trustee has received an Officer's Certificate stating that such securities
are so owned shall be so disregarded. Notes so owned which have been pledged in
good faith shall not be disregarded if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to the
Notes and that the pledgee is not an Issuers, a Guarantor or any other obligor
upon the Notes or any Affiliate of any of them.
Section 12.07. Rules by Trustee and Agents.
---------------------------
The Trustee may make reasonable rules for action by or meetings of
Noteholders. The Registrar and Paying Agent may make reasonable rules for their
functions.
Section 12.08. Business Days; Legal Holidays.
-----------------------------
A "Business Day" is a day that is not a Legal Holiday. A "Legal
Holiday" is a Saturday, a Sunday, a federally-recognized holiday or a day on
which banking institutions are not required to be open in the State of New York.
If a payment date is a
-111-
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
Section 12.09. Governing Law.
-------------
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. EACH OF THE 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 OR THE NOTES.
Section 12.10. No Adverse Interpretation of Other Agreements.
---------------------------------------------
This Indenture may not be used to interpret another indenture, loan,
security or debt agreement of the Issuers or any Subsidiary thereof. No such
indenture, loan, security or debt agreement may be used to interpret this
Indenture.
Section 12.11. No Recourse Against Others.
--------------------------
No recourse for the payment of the principal of or premium, if any, or
interest on any of the Notes, or for any claim based thereon or otherwise in
respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Issuers or any Guarantor in this Indenture or in any
supplemental indenture, or in any of the Notes, or because of the creation of
any Indebtedness represented thereby, shall be had against any stockholder,
officer, director or employee, as such, past, present or future, of the Issuers
or of any successor corporation or against the property or assets of any such
stockholder, officer, employee or director, either directly or through the
Issuers or any Guarantor, or any successor corporation thereof, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that this
Indenture and the Notes are solely obligations of the Issuers and the
Guarantors, and that no such personal liability whatever shall attach to, or is
or shall be incurred by, any stockholder, officer, employee or director of the
Issuers or any Guarantor, or any successor corporation thereof, because of the
creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or the Notes or
implied therefrom, and that any and all such personal liability of, and any and
all claims against every stockholder, officer, employee and director, are hereby
expressly
-112-
waived and released as a condition of, and as a consideration for, the execution
of this Indenture and the issuance of the Notes. It is understood that this
limitation on recourse is made expressly for the benefit of any such
shareholder, employee, officer or director and may be enforced by any of them.
Section 12.12. Successors.
----------
All agreements of the Issuers and the Guarantors in this Indenture and
the Notes shall bind their respective successors. All agreements of the
Trustee, any additional trustee and any Paying Agents in this Indenture shall
bind its successor.
Section 12.13. Multiple Counterparts.
---------------------
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent one and the same agreement.
Section 12.14. Table of Contents, Headings, etc.
--------------------------------
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
Section 12.15. Separability.
------------
Each provision of this Indenture shall be considered separable and if
for any reason any provision which is not essential to the effectuation of the
basic purpose of this Indenture or the Notes shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
-113-
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed all as of the date and year first written above.
PETERSEN PUBLISHING COMPANY, L.L.C.
By: ____________________________________
Name:
Title:
ATTEST:
_________________________
Name:
Title:
PETERSEN CAPITAL CORP.
By: ____________________________________
Name:
Title:
ATTEST:
_________________________
Name:
Title:
Guarantor:
PETERSEN HOLDINGS, L.L.C.
By: ____________________________________
Name:
Title:
ATTEST:
__________________________
Name:
Title:
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UNITED STATES TRUST COMPANY
OF NEW YORK as Trustee,
By: ____________________________________
Name:
Title:
ATTEST:
___________________________
Name:
Title:
EXHIBIT A
---------
(FACE OF NOTE)
[FORM OF NOTE]
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "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 BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE ACT)
OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) UNDER THE ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND
IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT
WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B)
INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE ACT, (C) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR
THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A
U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE
THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER
THE ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM
THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
IN CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN THREE YEARS AFTER ORIGINAL
ISSUANCE OF THIS NOTE, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY 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 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 ACT.
A-1
CUSIP 71 6336AAO
Number
PETERSEN PUBLISHING COMPANY, L.L.C.
PETERSEN CAPITAL CORP.
11 1/8% SENIOR SUBORDINATED NOTE DUE 2006
Petersen Publishing Company, L.L.C., a Delaware limited liability company
(the "Company", which term includes any successor corporation) and Petersen
Capital Corp., a Delaware corporation (jointly and severally, together with the
Company, the "Issuers"), for value received promise to pay to CEDE & CO. or
registered assigns the principal sum of ONE HUNDRED MILLION DOLLARS
($100,000,000), on November 15, 2006.
Interest Payment Dates: May 15 and November 15, commencing May 15, 1997
Record Dates: May 1 and November 1
This Note shall not be valid or obligatory for any purpose until the
certificate of authentication shall have been executed by the Trustee by its
manual signature.
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-2
IN WITNESS WHEREOF, the Issuers have caused this Note to be signed
manually or by facsimile by their duly authorized Officers.
PETERSEN PUBLISHING COMPANY, L.L.C.
By: _____________________________________
By: _____________________________________
PETERSEN CAPITAL CORP.
By: _____________________________________
By: _____________________________________
Certificate of Authentication:
This is one of the 11 1/8% Senior
Subordinated Notes due 2006 referred to in
the within-mentioned Indenture
Dated:
UNITED STATES TRUST COMPANY OF NEW YORK
as Trustee,
By: ___________________________________
Authorized Signatory
A-3
(REVERSE SIDE)
PETERSEN PUBLISHING COMPANY, L.L.C.
PETERSEN CAPITAL CORP.
11 1/8% SENIOR SUBORDINATED NOTE DUE 2006
1. INTEREST.
Petersen Publishing Company, L.L.C., a Delaware limited liability
company (the "Company") and Petersen Capital Corp., a Delaware corporation,
jointly and severally (and together with the Company, the "Issuers"), promise to
pay interest on the principal amount of this Note semiannually on May 15 and
November 15 of each year (each an "Interest Payment Date"), commencing on May
15, 1997, at the rate of 11 1/8% per annum. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. Interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of the original issuance of the Notes.
The Issuers shall pay interest on overdue principal, and on overdue
premium, if any, and overdue interest, to the extent lawful, at the rate equal
to 2% per annum in excess of the rate borne by the Notes.
2. METHOD OF PAYMENT.
The Issuers will pay interest on this Note provided for in Paragraph 1
above (except defaulted interest) to the person who is the registered Holder of
this Note at the close of business on the May 1 or November 1 preceding the
Interest Payment Date (whether or not such day is a Business Day). The Holder
must surrender this Note to a Paying Agent to collect principal payments. The
Issuers will 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; provided, however, that the Issuers may pay principal, premium,
-------- -------
if any, and interest by check payable in such money. They may mail an interest
check to the Holder's registered address.
3. PAYING AGENT AND REGISTRAR.
Initially, United States Trust Company of New York (the "Trustee")
will act as Paying Agent and Registrar. The Issuers may change any Paying Agent
or Registrar without notice to the Holders of the Notes. Neither the Issuers
nor any of their Subsidiaries or Affiliates may act as Paying Agent but may act
as Registrar.
A-4
4. INDENTURE; RESTRICTIVE COVENANTS.
The Issuers issued this Note under an Indenture dated as of November
15, 1996 (the "Indenture") among the Issuers, the Guarantors and the Trustee.
The terms of this Note 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. Code
(S)(S) 77aaa-77bbbb) as in effect on the date of the Indenture. This Note is
subject to all such terms, and the Holder of this Note is referred to the
Indenture and said Trust Indenture Act for a statement of them. All capitalized
terms in this Note, unless otherwise defined, have the meanings assigned to them
by the Indenture.
The Notes are general unsecured obligations of the Issuers limited to
$100,000,000 aggregate principal amount. The Indenture imposes certain
restrictions on, among other things, the incurrence of indebtedness, the
incurrence of liens and the issuance of capital stock by subsidiaries of the
Issuers, mergers and sale of assets, the payments of dividends on, or the
repurchase of, capital stock of the Issuers and their subsidiaries, certain
other restricted payments by the Issuers and their subsidiaries, certain
transactions with, and investments in, their affiliates, certain sale and lease-
back transactions and a provision regarding change-of-control transactions.
5. SUBORDINATION.
The Indebtedness evidenced by the Notes is, to the extent and in the
manner provided in the Indenture, subordinated and subject in right of payment
to the prior payment in full of all Senior Indebtedness as defined in the
Indenture, and this Note is issued subject to such provisions. Each Holder of
this Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee, on behalf of such Holder, to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided, however, that the
-------- -------
Indebtedness evidenced by this Note shall cease to be so subordinate and subject
in right of payment upon any defeasance of this Note referred to in Paragraph 18
below.
6. OPTIONAL REDEMPTION.
The Issuers, at their option, may redeem the Notes, in whole or in
part, at any time on or after November 15, 2001 upon not less than 30 nor more
than 60 days' notice, at the redemption prices (expressed as percentages of
principal amount), set forth below, plus accrued and unpaid interest to the
Redemption Date, if redeemed during the twelve month period beginning on
November 15 of each year listed below:
A-5
Year Redemption Price
---- ----------------
2001 ...................................... 105.563%
2002 ...................................... 103.708%
2003 ...................................... 101.854%
2004 and thereafter ....................... 100.000%
Notwithstanding the foregoing, the Issuers may redeem in the aggregate
up to 25% of the original principal amount of Notes at any time and from time to
time prior to November 15, 1999 at a redemption price equal to 111.125% of the
aggregate principal amount so redeemed, plus accrued interest to the Redemption
Date out of the Net Proceeds of one or more Public Equity Offerings; provided
--------
that at least $75,000,000 of the principal amount of Notes originally issued
remain outstanding immediately after the occurrence of any such redemption and
that any such redemption occurs within 90 days following the closing of any such
Public Equity Offering.
7. NOTICE OF REDEMPTION.
Notice of redemption will be mailed via first class mail at least 30
days but not more than 60 days prior to the redemption date to each Holder of
Notes to be redeemed at its registered address as it shall appear on the
register of the Notes maintained by the Registrar. On and after any Redemption
Date, interest will cease to accrue on the Notes or portions thereof called for
redemption unless the Issuers shall fail to redeem any such Note.
8. OFFERS TO PURCHASE.
The Indenture requires that certain proceeds from Asset Sales be used,
subject to further limitations contained therein, to make an offer to purchase
certain amounts of Notes in accordance with the procedures set forth in the
Indenture. The Issuers are also required to make an offer to purchase Notes
upon the occurrence of a Change of Control in accordance with procedures set
forth in the Indenture.
9. REGISTRATION RIGHTS.
Pursuant to the Registration Rights Agreement among the Issuers, the
Guarantors and First Union Capital Markets Corp. and CIBC Wood Gundy Securities
Corp., as initial purchasers of the Notes, the Issuers and the Guarantors will
be obligated to consummate an exchange offer pursuant to which the Holder of
this Note shall have the right to exchange this Note for Notes of a separate
series issued under the Indenture (or a trust indenture substantially identical
to the Indenture in accordance with the terms of the Registration Rights
Agreement) which have been registered under the Securities Act, in like
principal amount and having substantially identical terms as the Notes. The
Holders shall be entitled to receive certain additional interest payments in the
event such exchange offer is not consummated and upon
A-6
certain other conditions, all pursuant to and in accordance with the terms of
the Registration Rights Agreement.
10. DENOMINATIONS, TRANSFER, EXCHANGE.
The Notes are in registered form without coupons in denominations of
$1,000 and integral multiples thereof. A Holder may register the transfer or
exchange of Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any Note
selected for redemption or register the transfer of or exchange any Note for a
period of 15 days before the mailing of notice of redemption of Notes to be
redeemed or any Note after it is called for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
11. PERSONS DEEMED OWNERS.
The registered Holder of this Note may be treated as the owner of it
for all purposes.
12. UNCLAIMED MONEY.
If money for the payment of principal, premium or interest on any Note
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Issuers at their written request. After that, Holders entitled to
money must look to the Issuers for payment as general creditors unless an
"abandoned property" law designates another person.
13. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture or the Notes may be
modified, amended or supplemented by the Issuers, the Guarantors and the Trustee
with the consent of the Holders of at least a majority in principal amount of
the Notes then outstanding and any existing default or compliance with any
provision may be waived in a particular instance with the consent of the Holders
of a majority in principal amount of the Notes then outstanding. Without the
consent of Holders, the Issuers, the Guarantors and the Trustee may amend the
Indenture or the Notes or supplement the Indenture for certain specified
purposes including providing for uncertificated Notes in addition to
certificated Notes, and curing any ambiguity, defect or inconsistency, or making
any other change that does not materially and adversely affect the rights of any
Holder.
14. SUCCESSOR ENTITY.
When a successor corporation assumes all the obligations of its
predecessor under the Notes and the Indenture and immediately before and
thereafter no Default exists and
A-7
certain other conditions are satisfied, the predecessor corporation will be
released from those obligations.
15. DEFAULTS AND REMEDIES.
Events of Default are set forth in the Indenture. If an Event of
Default (other than an Event of Default pursuant to Section 6.01(6) or (7) of
the Indenture with respect to either of the Issuers) occurs and is continuing,
the Trustee by notice to the Issuers, or the Holders of not less than 25% in
aggregate principal amount of the Notes then outstanding, may declare to be
immediately due and payable the entire principal amount of all the Notes then
outstanding plus accrued but unpaid interest to the date of acceleration;
provided, however, that after such acceleration but before judgement or decree
- -------- -------
based on such acceleration is obtained by the Trustee, the Holders of a majority
in aggregate principal amount of the outstanding Notes may, under certain
circumstances, rescind and annul such acceleration and its consequences if all
existing Events of Default, other than the nonpayment of principal, premium or
interest that has become due solely because of the acceleration, have been cured
or waived and if the rescission would not conflict with any judgment or decree.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto. In case an Event of Default specified in Section 6.01(6) or
(7) of the Indenture with respect to either of the Issuers occurs, such
principal amount, together with premium, if any, and interest with respect to
all of the Notes, shall be due and payable immediately without any declaration
or other act on the part of the Trustee or the Holders of the Notes.
16. TRUSTEE DEALINGS WITH THE ISSUERS
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Issuers, any Guarantor or their Affiliates, and may otherwise deal with the
Issuers any Guarantor or their Affiliates, as if it were not Trustee.
17. NO RECOURSE AGAINST OTHERS.
As more fully described in the Indenture, a director, officer,
employee or stockholder, as such, of the Issuers or any Guarantor shall not have
any liability for any obligations of the Issuers or any Guarantor under the
Notes or the Indenture or for any claim based on, in respect or by reason of,
such obligations or their creation. The Holder of this Note by accepting this
Note waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of this Note.
18. DEFEASANCE AND COVENANT DEFEASANCE.
The Indenture contains provisions for defeasance of the entire
indebtedness on this Note and for defeasance of certain
A-8
covenants in the Indenture upon compliance by the Issuers with certain
conditions set forth in the Indenture.
19. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder of a Note
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).
20. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Note Identification Procedures, the Issuers have caused CUSIP Numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of the Notes. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
21. GOVERNING LAW.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH
OF THE 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
NOTE.
THE ISSUERS WILL FURNISH TO ANY HOLDER OF A NOTE UPON WRITTEN REQUEST
AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO: PETERSEN
PUBLISHING COMPANY, L.L.C., 6420 Wilshire Boulevard, Los Angeles, California
90048, Attention: Executive Vice President - Chief Financial Officer.
22. GUARANTEE.
The Note is initially entitled to the benefits of the Guarantee of the
Guarantors whose signature appears on the notation endorsed on this Note and may
thereafter be entitled to certain other Guarantees made for the benefit of the
Holders. Upon the terms and subject to the conditions set forth in the
Indenture, each Guarantor has jointly and severally with any other Guarantor,
unconditionally guaranteed on a senior basis that the principal of, and premium,
if any, interest and Additional Interest, if any, on and any additional amounts,
if any, with respect to the Notes will be duly and punctually paid in full when
due, whether at maturity, by acceleration or otherwise, and interest on overdue
principal, premium, if any, and (to the extent permitted by law) interest on any
interest or Additional Interest, if any, on the Notes and all other
A-9
Obligations of the Issuers to the Holders or the Trustee under the Notes or the
Indenture (including fees, expenses or other Obligations) will be promptly paid
in full or performed. A Guarantor shall be released from the Guarantee upon the
terms and subject to the conditions set forth in the Indenture. Reference is
hereby made to Article 10 of the Indenture and to Exhibit A to the Indenture for
the terms of the Guarantee.
A-10
ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
________________________________________________________________________________
________________________________________________________________________________
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
[Check One]
---------
[ ] (a) this Note is being transferred in compliance with the exemption from
registration under the Securities Act provided by Rule 144A thereunder.
or
--
[ ] (b) this Note is being transferred other than in accordance with (a)
above and documents are being furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Note 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 2.15 of the Indenture shall have been satisfied.
-2-
Date: ____________________ Your Signature: ______________________________
______________________________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee: ______________________________________________
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note 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 Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: __________________ ____________________________
NOTICE: To be executed by
an executive officer
NOTATION ON NOTE
RELATING TO GUARANTEE
Petersen Holdings, L.L.C. (the "Guarantor", which term includes any
successor Person under the Indenture) has unconditionally guaranteed, on a
senior subordinated basis, jointly and severally with any future Guarantors, to
the extent set forth in the Indenture and subject to the provisions of the
Indenture, (a) the due and punctual payment of the principal of and interest on
the Notes, whether at maturity, by acceleration or otherwise, the due and
punctual payment of interest on overdue principal, and, to the extent permitted
by law, interest, and the due and punctual performance of all other Obligations
of the Issuers to the Noteholders or the Trustee all in accordance with the
terms set forth in Article 10 of the Indenture, and (b) in case of any extension
of time of payment or renewal of any Notes or any of such other Obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
The obligations of the Guarantor to the Noteholders and to the Trustee
pursuant to this Guarantee and the Indenture are expressly set forth in Article
10 of the Indenture and reference is hereby made to the Indenture for the
precise terms of this Guarantee.
This Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Note upon which this Guarantee is noted
shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized signatories.
Guarantor: Petersen Holdings, L.L.C.
By: ___________________________________________
Name:
Title:
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by
the Company pursuant to Section 4.10 or Section 4.19 of the Indenture, check the
appropriate box:
[_] Section 4.10 [_] Section 4.19
If you want to have only part of the Note purchased by the pursuant
to Section 4.10 or Section 4.19 of the Indenture, state the amount you elect to
have purchased:
$_________________
Date: ____________
Your Signature: _________________________________________________
(Sign exactly as your name appears on the face
of this Note)
___________________________
Signature Guaranteed
EXHIBIT B
---------
(FACE OF NOTE)
[FORM OF NOTE]
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "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 BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE ACT)
OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) UNDER THE ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND
IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT
WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B)
INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE ACT, (C) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR
THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A
U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS
NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE
THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER
THE ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM
THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
IN CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN THREE YEARS AFTER ORIGINAL
ISSUANCE OF THIS NOTE, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY 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 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 ACT.
B-1
CUSIP UO4393AA9
Number
PETERSEN PUBLISHING COMPANY, L.L.C.
PETERSEN CAPITAL CORP.
11 1/8% SENIOR SUBORDINATED NOTE DUE 2006
Petersen Publishing Company, L.L.C., a Delaware limited liability company
(the "Company", which term includes any successor corporation) and Petersen
Capital Corp., a Delaware corporation (jointly and severally, together with the
Company, the "Issuers"), for value received promise to pay to CEDE & CO. or
registered assigns the principal sum of NO DOLLARS ($0), on November 15, 2006.
Interest Payment Dates: May 15 and November 15, commencing May 15, 1997
Record Dates: May 1 and November 1
This Note shall not be valid or obligatory for any purpose until the
certificate of authentication shall have been executed by the Trustee by its
manual signature.
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.
B-2
IN WITNESS WHEREOF, the Issuers have caused this Note to be signed
manually or by facsimile by their duly authorized Officers.
PETERSEN PUBLISHING COMPANY, L.L.C.
By: _______________________________________
By: _______________________________________
PETERSEN CAPITAL CORP.
By: _______________________________________
By: _______________________________________
Certificate of Authentication:
This is one of the 11 1/8% Senior
Subordinated Notes due 2006 referred to in
the within-mentioned Indenture
Dated:
UNITED STATES TRUST COMPANY OF NEW YORK
as Trustee,
By: ___________________________________
Authorized Signatory
B-3
(REVERSE SIDE)
PETERSEN PUBLISHING COMPANY, L.L.C.
PETERSEN CAPITAL CORP.
11 1/8% SENIOR SUBORDINATED NOTE DUE 2006
1. INTEREST.
Petersen Publishing Company, L.L.C., a Delaware limited liability
company (the "Company") and Petersen Capital Corp., a Delaware corporation,
jointly and severally (and together with the Company, the "Issuers"), promise to
pay interest on the principal amount of this Note semiannually on May 15 and
November 15 of each year (each an "Interest Payment Date"), commencing on May
15, 1997, at the rate of 11 1/8% per annum. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. Interest on the Notes will
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from the date of the original issuance of the Notes.
The Issuers shall pay interest on overdue principal, and on overdue
premium, if any, and overdue interest, to the extent lawful, at the rate equal
to 2% per annum in excess of the rate borne by the Notes.
2. METHOD OF PAYMENT.
The Issuers will pay interest on this Note provided for in Paragraph 1
above (except defaulted interest) to the person who is the registered Holder of
this Note at the close of business on the May 1 or November 1 preceding the
Interest Payment Date (whether or not such day is a Business Day). The Holder
must surrender this Note to a Paying Agent to collect principal payments. The
Issuers will 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; provided, however, that the Issuers may pay principal, premium,
-------- -------
if any, and interest by check payable in such money. They may mail an interest
check to the Holder's registered address.
3. PAYING AGENT AND REGISTRAR.
Initially, United States Trust Company of New York (the "Trustee")
will act as Paying Agent and Registrar. The Issuers may change any Paying Agent
or Registrar without notice to the Holders of the Notes. Neither the Issuers
nor any of their Subsidiaries or Affiliates may act as Paying Agent but may act
as Registrar.
B-4
4. INDENTURE; RESTRICTIVE COVENANTS.
The Issuers issued this Note under an Indenture dated as of November
15, 1996 (the "Indenture") among the Issuers, the Guarantors and the Trustee.
The terms of this Note 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. Code
(S)(S) 77aaa-77bbbb) as in effect on the date of the Indenture. This Note is
subject to all such terms, and the Holder of this Note is referred to the
Indenture and said Trust Indenture Act for a statement of them. All capitalized
terms in this Note, unless otherwise defined, have the meanings assigned to them
by the Indenture.
The Notes are general unsecured obligations of the Issuers limited to
$100,000,000 aggregate principal amount. The Indenture imposes certain
restrictions on, among other things, the incurrence of indebtedness, the
incurrence of liens and the issuance of capital stock by subsidiaries of the
Issuers, mergers and sale of assets, the payments of dividends on, or the
repurchase of, capital stock of the Issuers and their subsidiaries, certain
other restricted payments by the Issuers and their subsidiaries, certain
transactions with, and investments in, their affiliates, certain sale and lease-
back transactions and a provision regarding change-of-control transactions.
5. SUBORDINATION.
The Indebtedness evidenced by the Notes is, to the extent and in the
manner provided in the Indenture, subordinated and subject in right of payment
to the prior payment in full of all Senior Indebtedness as defined in the
Indenture, and this Note is issued subject to such provisions. Each Holder of
this Note, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee, on behalf of such Holder, to
take such action as may be necessary or appropriate to effectuate the
subordination as provided in the Indenture and (c) appoints the Trustee
attorney-in-fact of such Holder for such purpose; provided, however, that the
-------- -------
Indebtedness evidenced by this Note shall cease to be so subordinate and subject
in right of payment upon any defeasance of this Note referred to in Paragraph 18
below.
6. OPTIONAL REDEMPTION.
The Issuers, at their option, may redeem the Notes, in whole or in
part, at any time on or after November 15, 2001 upon not less than 30 nor more
than 60 days' notice, at the redemption prices (expressed as percentages of
principal amount), set forth below, plus accrued and unpaid interest to the
Redemption Date, if redeemed during the twelve month period beginning on
November 15 of each year listed below:
B-5
Year Redemption Price
---- ----------------
2001 .................................. 105.563%
2002 .................................. 103.708%
2003 .................................. 101.854%
2004 and thereafter ................... 100.000%
Notwithstanding the foregoing, the Issuers may redeem in the aggregate
up to 25% of the original principal amount of Notes at any time and from time to
time prior to November 15, 1999 at a redemption price equal to 111.125% of the
aggregate principal amount so redeemed, plus accrued interest to the Redemption
Date out of the Net Proceeds of one or more Public Equity Offerings; provided
--------
that at least $75,000,000 of the principal amount of Notes originally issued
remain outstanding immediately after the occurrence of any such redemption and
that any such redemption occurs within 90 days following the closing of any such
Public Equity Offering.
7. NOTICE OF REDEMPTION.
Notice of redemption will be mailed via first class mail at least 30
days but not more than 60 days prior to the redemption date to each Holder of
Notes to be redeemed at its registered address as it shall appear on the
register of the Notes maintained by the Registrar. On and after any Redemption
Date, interest will cease to accrue on the Notes or portions thereof called for
redemption unless the Issuers shall fail to redeem any such Note.
8. OFFERS TO PURCHASE.
The Indenture requires that certain proceeds from Asset Sales be used,
subject to further limitations contained therein, to make an offer to purchase
certain amounts of Notes in accordance with the procedures set forth in the
Indenture. The Issuers are also required to make an offer to purchase Notes
upon the occurrence of a Change of Control in accordance with procedures set
forth in the Indenture.
9. REGISTRATION RIGHTS.
Pursuant to the Registration Rights Agreement among the Issuers, the
Guarantors and First Union Capital Markets Corp. and CIBC Wood Gundy Securities
Corp., as initial purchasers of the Notes, the Issuers and the Guarantors will
be obligated to consummate an exchange offer pursuant to which the Holder of
this Note shall have the right to exchange this Note for Notes of a separate
series issued under the Indenture (or a trust indenture substantially identical
to the Indenture in accordance with the terms of the Registration Rights
Agreement) which have been registered under the Securities Act, in like
principal amount and having substantially identical terms as the Notes. The
Holders shall be entitled to receive certain additional interest payments in the
event such exchange offer is not consummated and upon
B-6
certain other conditions, all pursuant to and in accordance with the terms of
the Registration Rights Agreement.
10. DENOMINATIONS, TRANSFER, EXCHANGE.
The Notes are in registered form without coupons in denominations of
$1,000 and integral multiples thereof. A Holder may register the transfer or
exchange of Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any Note
selected for redemption or register the transfer of or exchange any Note for a
period of 15 days before the mailing of notice of redemption of Notes to be
redeemed or any Note after it is called for redemption in whole or in part,
except the unredeemed portion of any Note being redeemed in part.
11. PERSONS DEEMED OWNERS.
The registered Holder of this Note may be treated as the owner of it
for all purposes.
12. UNCLAIMED MONEY.
If money for the payment of principal, premium or interest on any Note
remains unclaimed for two years, the Trustee or Paying Agent will pay the money
back to the Issuers at their written request. After that, Holders entitled to
money must look to the Issuers for payment as general creditors unless an
"abandoned property" law designates another person.
13. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture or the Notes may be
modified, amended or supplemented by the Issuers, the Guarantors and the Trustee
with the consent of the Holders of at least a majority in principal amount of
the Notes then outstanding and any existing default or compliance with any
provision may be waived in a particular instance with the consent of the Holders
of a majority in principal amount of the Notes then outstanding. Without the
consent of Holders, the Issuers, the Guarantors and the Trustee may amend the
Indenture or the Notes or supplement the Indenture for certain specified
purposes including providing for uncertificated Notes in addition to
certificated Notes, and curing any ambiguity, defect or inconsistency, or making
any other change that does not materially and adversely affect the rights of any
Holder.
14. SUCCESSOR ENTITY.
When a successor corporation assumes all the obligations of its
predecessor under the Notes and the Indenture and immediately before and
thereafter no Default exists and
B-7
certain other conditions are satisfied, the predecessor corporation will be
released from those obligations.
15. DEFAULTS AND REMEDIES.
Events of Default are set forth in the Indenture. If an Event of
Default (other than an Event of Default pursuant to Section 6.01(6) or (7) of
the Indenture with respect to either of the Issuers) occurs and is continuing,
the Trustee by notice to the Issuers, or the Holders of not less than 25% in
aggregate principal amount of the Notes then outstanding, may declare to be
immediately due and payable the entire principal amount of all the Notes then
outstanding plus accrued but unpaid interest to the date of acceleration;
provided, however, that after such acceleration but before judgement or decree
- -------- -------
based on such acceleration is obtained by the Trustee, the Holders of a majority
in aggregate principal amount of the outstanding Notes may, under certain
circumstances, rescind and annul such acceleration and its consequences if all
existing Events of Default, other than the nonpayment of principal, premium or
interest that has become due solely because of the acceleration, have been cured
or waived and if the rescission would not conflict with any judgment or decree.
No such rescission shall affect any subsequent Default or impair any right
consequent thereto. In case an Event of Default specified in Section 6.01(6) or
(7) of the Indenture with respect to either of the Issuers occurs, such
principal amount, together with premium, if any, and interest with respect to
all of the Notes, shall be due and payable immediately without any declaration
or other act on the part of the Trustee or the Holders of the Notes.
16. TRUSTEE DEALINGS WITH THE ISSUERS
The Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Issuers, any Guarantor or their Affiliates, and may otherwise deal with the
Issuers any Guarantor or their Affiliates, as if it were not Trustee.
17. NO RECOURSE AGAINST OTHERS.
As more fully described in the Indenture, a director, officer,
employee or stockholder, as such, of the Issuers or any Guarantor shall not have
any liability for any obligations of the Issuers or any Guarantor under the
Notes or the Indenture or for any claim based on, in respect or by reason of,
such obligations or their creation. The Holder of this Note by accepting this
Note waives and releases all such liability. The waiver and release are part of
the consideration for the issuance of this Note.
18. DEFEASANCE AND COVENANT DEFEASANCE.
The Indenture contains provisions for defeasance of the entire
indebtedness on this Note and for defeasance of certain
B-8
covenants in the Indenture upon compliance by the Issuers with certain
conditions set forth in the Indenture.
19. ABBREVIATIONS.
Customary abbreviations may be used in the name of a Holder of a Note
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).
20. CUSIP NUMBERS.
Pursuant to a recommendation promulgated by the Committee on Uniform
Note Identification Procedures, the Issuers have caused CUSIP Numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of the Notes. No
representation is made as to the accuracy of such numbers either as printed on
the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
21. GOVERNING LAW.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN
THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH
OF THE 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
NOTE.
THE ISSUERS WILL FURNISH TO ANY HOLDER OF A NOTE UPON WRITTEN REQUEST
AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO: PETERSEN
PUBLISHING COMPANY, L.L.C., 6420 Wilshire Boulevard, Los Angeles, California
90048, Attention: Executive Vice President - Chief Financial Officer.
22. GUARANTEE.
The Note is initially entitled to the benefits of the Guarantee of the
Guarantors whose signature appears on the notation endorsed on this Note and may
thereafter be entitled to certain other Guarantees made for the benefit of the
Holders. Upon the terms and subject to the conditions set forth in the
Indenture, each Guarantor has jointly and severally with any other Guarantor,
unconditionally guaranteed on a senior basis that the principal of, and premium,
if any, interest and Additional Interest, if any, on and any additional amounts,
if any, with respect to the Notes will be duly and punctually paid in full when
due, whether at maturity, by acceleration or otherwise, and interest on overdue
principal, premium, if any, and (to the extent permitted by law) interest on any
interest or Additional Interest, if any, on the Notes and all other
B-9
Obligations of the Issuers to the Holders or the Trustee under the Notes or the
Indenture (including fees, expenses or other Obligations) will be promptly paid
in full or performed. A Guarantor shall be released from the Guarantee upon the
terms and subject to the conditions set forth in the Indenture. Reference is
hereby made to Article 10 of the Indenture and to Exhibit A to the Indenture for
the terms of the Guarantee.
B-10
ASSIGNMENT
I or we assign and transfer this Note to:
(Insert assignee's social security or tax I.D. number)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type name, address and zip code of assignee)
and irrevocably appoint:
________________________________________________________________________________
________________________________________________________________________________
Agent to transfer this Note on the books of the Company. The Agent may
substitute another to act for him.
[Check One]
---------
[ ] (a) this Note is being transferred in compliance with the exemption from
registration under the Securities Act provided by Rule 144A thereunder.
or
--
[ ] (b) this Note is being transferred other than in accordance with (a)
above and documents are being furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Note 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 2.15 of the Indenture shall have been satisfied.
-2-
Date: ____________________ Your Signature: ________________________________
________________________________________________
(Sign exactly as your name
appears on the other side of
this Note)
Signature Guarantee: ________________________________________________
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note 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 Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: __________________ ____________________________
NOTICE: To be executed by
an executive officer
NOTATION ON NOTE
RELATING TO GUARANTEE
Petersen Holdings, L.L.C. (the "Guarantor", which term includes any
successor Person under the Indenture) has unconditionally guaranteed, on a
senior subordinated basis, jointly and severally with any future Guarantors, to
the extent set forth in the Indenture and subject to the provisions of the
Indenture, (a) the due and punctual payment of the principal of and interest on
the Notes, whether at maturity, by acceleration or otherwise, the due and
punctual payment of interest on overdue principal, and, to the extent permitted
by law, interest, and the due and punctual performance of all other Obligations
of the Issuers to the Noteholders or the Trustee all in accordance with the
terms set forth in Article 10 of the Indenture, and (b) in case of any extension
of time of payment or renewal of any Notes or any of such other Obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.
The obligations of the Guarantor to the Noteholders and to the Trustee
pursuant to this Guarantee and the Indenture are expressly set forth in Article
10 of the Indenture and reference is hereby made to the Indenture for the
precise terms of this Guarantee.
This Guarantee shall not be valid or obligatory for any purpose until
the certificate of authentication on the Note upon which this Guarantee is noted
shall have been executed by the Trustee under the Indenture by the manual
signature of one of its authorized signatories.
Guarantor: Petersen Holdings, L.L.C.
By: __________________________________________________
Name:
Title:
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by
the Company pursuant to Section 4.10 or Section 4.19 of the Indenture, check the
appropriate box:
[_] Section 4.10 [_] Section 4.19
If you want to have only part of the Note purchased by the pursuant
to Section 4.10 or Section 4.19 of the Indenture, state the amount you elect to
have purchased:
$_________________
Date: ____________
Your Signature: _______________________________________________
(Sign exactly as your name appears on the face
of this Note)
___________________________
Signature Guaranteed
EXHIBIT C
---------
FORM OF LEGEND FOR GLOBAL NOTES
Any Global Note authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY. THIS NOTE IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY
TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (A NEW YORK CORPORATION) ("DTC") TO THE
ISSUERS OR THEIR AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR 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.
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EXHIBIT D
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Form of Certificate to Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
-----------------------------------------
___________, ____
United States Trust Company of New York
Attention: Corporate Trust Department
Re: Petersen Publishing Company, L.L.C.
and Petersen Capital Corp. (the
"Issuers") 11 1/8% Senior Subordinated
Notes due 2006 (the "Notes")
--------------------------------------
Dear Sirs:
In connection with our proposed purchase of $_______ aggregate
principal amount of the Notes, we confirm that:
1. We understand that any subsequent transfer of the Notes is subject
to certain restrictions and conditions set forth in the Indenture dated as
of November 15, 1996 relating to the Notes 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").
2. We understand that the Notes have not been registered under the
Securities Act, and that the Notes 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 any Notes within three years after the original issuance
of the Notes, we will do so only (A) to the Issuers or any subsidiary
thereof, (B) inside the United States in compliance with Rule 144A under
the Securities Act, to a "qualified institutional buyer" (as defined in
Rule 144A), (C) inside the United States to an "accredited investor" (as
defined below) that, prior to such transfer, furnishes to you a signed
letter substantially in the form of this letter, (D) outside the United
States to a foreign person in compliance with Rule 904 of Regulation S
under the Securities Act, (E) pursuant to the exemption from registration
provided by Rule 144 under the Securities Act (if available), or (F)
pursuant to an effective registration statement under the Securities Act,
and we further agree to
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provide to any person purchasing any of the Notes from us a notice advising
such purchaser that resales of the Notes are restricted as stated herein.
3. We understand that, on any proposed resale of any Notes, we will
be required to furnish to you and the Issuers such certifications, legal
opinions and other information as you and the Issuers may reasonably
require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Notes purchased by us will
bear a legend to the foregoing effect.
4. We are an "accredited investor" (as defined in Rule 501(a)(1),
(2), (3) or (7) 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 Notes, and we and any
accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Notes purchased by us for our own account or
for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.
You and the Issuers 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.
Very truly yours,
[Name of Transferee]
By: _____________________________________
Authorized Signature
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EXHIBIT E
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Form of Certificate to Be Delivered
in Connection with Transfers
Pursuant to Regulation S
-----------------------------------
______________, ____
United States Trust Company of New York
114 West 47th Street
New York, New York 10036
]
Attention: Corporate Trust Department
Re: Petersen Publishing Company, L.L.C.
and Petersen Capital Corp. (the
"Issuers") 11 1/8% Senior Subordinated
Notes due 2006 (the "Notes")
--------------------------------------
Dear Sirs:
In connection with our proposed sale of $___________ aggregate
principal amount of the Notes, 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 Notes 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 off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been pre-
arranged 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
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(5) we have advised the transferee of the transfer restrictions
applicable to the Notes.
You and the Issuers 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.
Very truly yours,
[Name of Transferor]
By: ________________________________________
Authorized Signature
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