Exhibit 4.1
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INDENTURE
Dated as of September 18, 1997
Among
COMMUNICATIONS INSTRUMENTS, INC.,
as Issuer,
KILOVAC CORPORATION,
KILOVAC INTERNATIONAL, INC.,
and
EACH OF THE ISSUER'S FUTURE RESTRICTED DOMESTIC SUBSIDIARIES,
as Guarantors,
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, as Trustee
__________________
$125,000,000
10% Senior Subordinated Notes due 2004
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[CROSS-REFERENCE TABLE]
TIA Indenture
Section Section
- - ------- ---------
310 (a) (1).................................................... 7.10
(a) (2).................................................... 7.10
(a) (3).................................................... N.A.**
(a) (4).................................................... N.A.
(a) (5).................................................... 7.08; 7.10
(b)........................................................ 7.08; 7.10
(c)........................................................ N.A.
311 (a)........................................................ 7.11
(b)........................................................ 7.11
(c)........................................................ N.A.
312 (a)........................................................ 2.05
(b)........................................................ 13.03
(c)........................................................ 13.03
313 (a)........................................................ 7.06
(b) (1).................................................... 7.06
(b) (2).................................................... 7.06
(c) ....................................................... 7.06; 13.02
(d) ....................................................... 7.06
314 (a) (1), (2), (3).......................................... 4.06; 4.08;
7.06; 13.02
(a) (4).................................................... 4.06
(b)........................................................ N.A.
(c) (1).................................................... 13.04
(c) (2).................................................... 13.04
(c) (3).................................................... N.A.
(d)........................................................ 1.05
(e)........................................................ 13.05
(f)........................................................ N.A.
315 (a)........................................................ 7.01(b)
(b)........................................................ 7.05; 13.02
(c)........................................................ 7.01(a)
(d)........................................................ 7.01(c)
(e)........................................................ 6.11
316 (a)(last sentence)......................................... 2.09
(a) (1) (A)................................................ 6.05
(a) (1) (B)................................................ 6.04
(a) (2).................................................... N.A.
(b)........................................................ 6.07
317 (a) (1).................................................... 6.08
(a) (2).................................................... 6.09
(b)........................................................ 2.04
318 (a)........................................................ 13.01
(c)........................................................ 13.01
**N.A. means Not Applicable
Security: This Cross-Reference Table shall not, for any purpose, be deemed to be
a part of this Indenture.
TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE.......................... 1
SECTION 1.01. Definitions.......................................... 1
SECTION 1.02. Incorporation by Reference of TIA.................... 26
SECTION 1.03. Rules of Construction................................ 26
ARTICLE TWO
THE SECURITIES...................................................... 27
SECTION 2.01. Form and Dating...................................... 27
SECTION 2.02. Execution and Authentication......................... 28
SECTION 2.03. Registrar and Paying Agent........................... 29
SECTION 2.04. Paying Agent To Hold Assets in Trust................. 29
SECTION 2.05. Securityholder Lists................................. 30
SECTION 2.06. Transfer and Exchange................................ 30
SECTION 2.07. Replacement Securities............................... 31
SECTION 2.08. Outstanding Securities............................... 31
SECTION 2.09. Treasury Securities.................................. 32
SECTION 2.10. Temporary Securities................................. 32
SECTION 2.11. Cancellation......................................... 32
SECTION 2.12. Defaulted Interest................................... 33
SECTION 2.13. CUSIP Number......................................... 33
SECTION 2.14. Deposit of Moneys.................................... 33
SECTION 2.15. Book-Entry Provisions for............................ 34
Global Securities
SECTION 2.16. Special Transfer Provisions.......................... 35
ARTICLE THREE
REDEMPTION.......................................................... 39
SECTION 3.01. Optional Redemption.................................. 39
SECTION 3.02. Applicability of Article............................. 39
SECTION 3.03. Election To Redeem; Notice to Trustee................ 39
SECTION 3.04. Selection by Trustee of Securities To Be
Redeemed............................................. 40
SECTION 3.05. Notice of Redemption................................. 40
SECTION 3.06. Deposit of Redemption Price.......................... 41
SECTION 3.07. Securities Payable on Redemption Date................ 41
SECTION 3.08. Securities Redeemed in Part.......................... 42
ARTICLE FOUR
COVENANTS........................................................... 42
SECTION 4.01. Payment of Securities................................ 42
SECTION 4.02. Maintenance of Office or Agency...................... 43
SECTION 4.03. Corporate Existence.................................. 43
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SECTION 4.04. Payment of Taxes and Other Claims............................................ 43
SECTION 4.05. Maintenance of Properties and Insurance...................................... 44
SECTION 4.06. Compliance Certificate; Notice of Default.................................... 44
SECTION 4.07. Compliance with Laws......................................................... 45
SECTION 4.08. Reports...................................................................... 45
SECTION 4.09. Waiver of Stay, Extension or Usury Laws...................................... 46
SECTION 4.10. Limitation on Restricted Payments............................................ 46
SECTION 4.11. Limitation on Transactions with Related Persons.............................. 47
SECTION 4.12. Limitation on Incurrence of Debt and Issuance of Disqual..................... 49
SECTION 4.13. Payment Restrictions Affecting Restricted Subsidiaries....................... 51
SECTION 4.14. Prohibition on Incurrence of Senior Subordinated Debt........................ 52
SECTION 4.15. Change of Control............................................................ 52
SECTION 4.16. Limitation on Asset Sales.................................................... 55
SECTION 4.17. Limitation on Liens.......................................................... 57
SECTION 4.18. Guarantees by Restricted Domestic Subsidiaries............................... 57
SECTION 4.19. Conduct of Business of the Issuer and Its Restricted Sub..................... 58
SECTION 4.20. Guarantors................................................................... 58
SECTION 4.21. Rule 144A Information Requirement............................................ 59
SECTION 4.22. Payments for Consent......................................................... 59
ARTICLE FIVE
SUCCESSOR CORPORATION........................................................................ 59
SECTION 5.01. Merger, Consolidation or Sale of Assets...................................... 59
ARTICLE SIX
DEFAULT AND REMEDIES......................................................................... 61
SECTION 6.01. Events of Default............................................................ 61
SECTION 6.02. Acceleration................................................................. 63
SECTION 6.03. Other Remedies............................................................... 64
SECTION 6.04. Waiver of Past Defaults...................................................... 64
SECTION 6.05. Control by Majority.......................................................... 65
SECTION 6.06. Limitation on Suits.......................................................... 65
SECTION 6.07. Rights of Holders To Receive Payment......................................... 66
SECTION 6.08. Collection Suit by Trustee................................................... 66
SECTION 6.09. Trustee May File Proofs of Claim............................................. 66
SECTION 6.10. Priorities................................................................... 67
SECTION 6.11. Undertaking for Costs........................................................ 67
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ARTICLE SEVEN
TRUSTEE........................................................................... 68
SECTION 7.01. Duties of Trustee.................................................. 68
SECTION 7.02. Rights of Trustee.................................................. 69
SECTION 7.03. Individual Rights of Trustee....................................... 70
SECTION 7.04. Disclaimer of Trustee.............................................. 71
SECTION 7.05. Notice of Default.................................................. 71
SECTION 7.06. Reports by Trustee to Holders...................................... 71
SECTION 7.07. Compensation and Indemnity......................................... 72
SECTION 7.08. Replacement of Trustee............................................. 73
SECTION 7.09. Successor Trustee by Merger, etc................................... 74
SECTION 7.10. Eligibility; Disqualification...................................... 74
SECTION 7.11. Preferential Collection of Claims Against the Issuer............... 74
ARTICLE EIGHT
DISCHARGE OF THIS INDENTURE; DEFEASANCE........................................... 75
SECTION 8.01. Option to Effect Defeasance or Covenant Defeasance................. 75
SECTION 8.02. Defeasance and Discharge........................................... 75
SECTION 8.03. Covenant Defeasance................................................ 75
SECTION 8.04. Conditions to Defeasance or Covenant Defeasance.................... 76
SECTION 8.05. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Other Miscellaneous Provisions............... 78
SECTION 8.06. Reinstatement...................................................... 79
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS............................................... 80
SECTION 9.01. Without Consent of Holders......................................... 80
SECTION 9.02. With Consent of Holders............................................ 81
SECTION 9.03. Compliance with TIA................................................ 82
SECTION 9.04. Revocation and Effect of Consents.................................. 82
SECTION 9.05. Notation on or Exchange of Securities.............................. 83
SECTION 9.06. Trustee To Sign Amendments, etc.................................... 83
ARTICLE TEN
SUBORDINATION OF SECURITIES....................................................... 84
SECTION 10.01. Securities Subordinated to Senior Debt............................ 84
SECTION 10.02. No Payment on Securities in Certain Circumstances................ 84
SECTION 10.03. Payment Over of Proceeds upon Dissolution, etc.................... 86
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SECTION 10.04. Payments May Be Paid Prior to Dissolution.................................................... 87
SECTION 10.05. Subrogation.................................................................................. 88
SECTION 10.06. Obligations of the Issuer Unconditional...................................................... 88
SECTION 10.07. Notice to Trustee............................................................................ 88
SECTION 10.08. Reliance on Judicial Order or Certificate of Liquidating Agent............................... 89
SECTION 10.09. Trustee's Relation to Senior Debt............................................................ 90
SECTION 10.10. Subordination Rights Not Impaired by Acts or Omissions of
the Issuer or Holders of Senior Debt....................................................... 90
SECTION 10.11. Securityholders Authorize Trustee To Effectuate Subordination of Securities.................. 91
SECTION 10.12. This Article Ten Not To Prevent Events of Default............................................ 92
ARTICLE ELEVEN
GUARANTEES OF THE SECURITIES................................................................................. 92
SECTION 11.01. Guarantees................................................................................... 92
SECTION 11.02. Execution and Delivery of the Guarantees..................................................... 94
SECTION 11.03. Additional Guarantors........................................................................ 94
SECTION 11.04. Limitation of Guarantors' Liability.......................................................... 95
SECTION 11.05. Release from Guarantee....................................................................... 95
SECTION 11.06. Contribution................................................................................. 96
SECTION 11.07. Waiver of Subrogation........................................................................ 96
ARTICLE TWELVE
SUBORDINATION OF GUARANTEES.................................................................................. 97
SECTION 12.01. Guarantee Obligations Subordinated to Guarantor Senior Debt.................................. 97
SECTION 12.02. No Payment on Guarantees in Certain Circumstances............................................ 97
SECTION 12.03. Payment Over of Proceeds Upon Dissolution, etc............................................... 99
SECTION 12.04. Payments May Be Paid Prior to Dissolution.................................................... 101
SECTION 12.05. Subrogation.................................................................................. 101
SECTION 12.06. Guarantee Provisions Solely To Define Relative Rights........................................ 102
SECTION 12.07. Trustee To Effectuate Subordination of Obligations Under the Guarantees...................... 102
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SECTION 12.08. No Waiver of Guarantee Subordination Provisions..................... 103
SECTION 12.09. Guarantors To Give Notice to Trustee................................ 104
SECTION 12.10. Reliance on Judicial Order or Certificate
of Liquidating Agent Regarding Dissolution,
etc., of Guarantors.
SECTION 12.11. No Suspension of Remedies........................................... 105
SECTION 12.12. Trustee's Relation to Guarantor Senior Debt......................... 105
SECTION 12.13. No Subordination of Certain Claims.................................. 106
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. TIA Controls........................................................ 106
SECTION 13.02. Notices............................................................. 106
SECTION 13.03. Communications by Holders with Other Holders........................ 107
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.................. 108
SECTION 13.05. Statements Required in Certificate or Opinion....................... 108
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar........................... 108
SECTION 13.07. Legal Holidays...................................................... 109
SECTION 13.08. Governing Law....................................................... 109
SECTION 13.09. No Adverse Interpretation of Other Agreements....................... 109
SECTION 13.10. No Recourse Against Others.......................................... 109
SECTION 13.11. Successors.......................................................... 109
SECTION 13.12. Duplicate Originals................................................. 110
SECTION 13.13. Severability........................................................ 110
SIGNATURES............................................................................... 111
Exhibit A-1 - Form of Security
Exhibit A-2 - Form of Exchange Security
Exhibit B - Form of Legend for Global Security
Exhibit C - Transferee Certificate for Institutional Accredited Investors Who
Are Not QIBs
Security: This Table of Contents shall not, for any purpose, be deemed to be
part of this Indenture.
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This INDENTURE, dated as of September 18, 1997, among COMMUNICATIONS
INSTRUMENTS, INC., a North Carolina corporation (the "Issuer"), KILOVAC
CORPORATION, a California corporation ("Kilovac"), KILOVAC INTERNATIONAL, INC.,
a California corporation ("Kilovac International"), and each of the Issuer's
future Restricted Domestic Subsidiaries (collectively, with Kilovac and Kilovac
International, the "Guarantors"), and NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, a national banking association, as trustee (the "Trustee").
Each party hereto agrees as follows for the benefit of the other
parties and for the equal and ratable benefit of the holders of the Issuer's 10%
Senior Subordinated Notes due 2004:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acceleration Notice" has the meaning provided in Section 6.02.
"Accounts Receivable Subsidiary" means any Subsidiary of the Issuer
that is, directly or indirectly, wholly owned by the Issuer (other than director
qualifying shares) and organized solely for the purpose of and engaged in (i)
purchasing, financing and collecting accounts receivable obligations of
customers of the Issuer or its Subsidiaries, (ii) the sale or financing of such
accounts receivable or interest therein and (iii) other activities incident
thereto.
"Acquired Debt" means, with respect to any specific Person, (i) Debt
of any other Person existing at the time such other Person is merged with or
into or became a Restricted Subsidiary of such specified Person, including,
without limitation, Debt incurred in connection with, or in contemplation of,
such other Person merging with or into or becoming a Restricted Subsidiary of
such specified Person, and (ii) Debt secured by a Lien encumbering any asset
acquired by such specified Person which, in each case, is not repaid at or
within five days following the date of such acquisition.
"Adjusted Net Assets" of a Guarantor at any date means 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 incurred or assumed on such
date), but excluding liabilities under its 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 incurred or assumed on such date and after giving effect
to any collection from any Subsidiary of such Guarantor in respect of the
obligations of such Subsidiary under the Guarantee of such Guarantor), excluding
Guarantor Subordinated Debt and debt in respect of its Guarantee, as they become
absolute and matured.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition "Control"
(including, with correlative meanings, the terms "Controlling", "Controlled by"
and "under common control with"), as used with respect to any Person, shall mean
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 Co-Registrar.
"Agent Members" has the meaning provided in Section 2.15.
"Asset Sale" means (i) the sale, lease (other than operating leases
entered into in the ordinary course of business), conveyance or other
disposition of any assets or rights (including, without limitation, by way of a
sale and leaseback) other than in the ordinary course of business (provided that
the sale, lease, conveyance or other disposition of all or substantially all of
the assets of the Issuer and its Restricted Subsidiaries taken as a whole will
be governed by the provisions of this Indenture described under Article Four,
and (ii) the sale by the Issuer or any of its Restricted Subsidiaries of Equity
Interests of any of the Issuer's Restricted Subsidiaries (to the extent such
Equity Interests are held by the Issuer or another Restricted Subsidiary of the
Issuer), in the case of either clause (i) or (ii), whether in a single
transaction or a series of related transactions (a) that have a fair market
value in excess of $750,000 or (b) net proceeds in excess of $750,000.
Notwithstanding the foregoing: (t) a transfer of assets by the Issuer to a
Restricted Subsidiary or by a Restricted Subsidiary to the Issuer or to another
Restricted Subsidiary, (u) a disposition of goods held for sale in the ordinary
course of business or obsolete, worn out or damaged property or equipment in the
ordinary course of business, (v) an
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issuance of Equity Interests by a Restricted Subsidiary to the Issuer or to
another Restricted Subsidiary, (w) a Restricted Payment or Permitted Investment
that is permitted by Article Four, (x) the sale or discount, in each case
without recourse, of accounts receivable arising in the ordinary course of
business, but only in connection with the compromise or collection thereof, (y)
the grant in the ordinary course of business of any non-exclusive license of
patents, trademarks, registrations therefore and other similar intellectual
property and (z) sales of accounts receivable for cash at fair market value, and
any sale, conveyance or transfer of accounts receivable in the ordinary course
of business to an Accounts Receivable Subsidiary or to third parties that are
not Affiliates of the Issuer or any Subsidiary of the Issuer will not be deemed
to be Asset Sales.
"Asset Sale Offer" has the meaning provided in Section 4.16(c).
"Asset Sale Payment Date" has the meaning provided in Section 4.16(c).
"Asset Sale Offered Price" has the meaning provided in Section
4.16(c).
"Asset Sale Pari Passu Offer" has the meaning provided in Section
4.16(c).
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the present value (discounted at the rate
of interest implicit in such transaction, determined in accordance with GAAP) of
the obligation of the lessee for net rental payments during the remaining term
of the lease included in such sale and leaseback transaction (including any
period for which such lease has been extended or may, at the option of the
lessor, be extended).
"Authenticating Agent" has the meaning provided in Section 2.02.
"Authorized Officer" means, with respect to any Person, each of the
Chairman of the Board, the Chief Executive Officer, the President, the Chief
Financial Officer, a Vice President, the Treasurer, the Secretary or an
Assistant Secretary of such Person, or any other officer designated as an
Authorized Officer by the Board of Directors (or similar governing body of such
Person) in a writing delivered to the Trustee, or with respect to a Person
organized as a partnership, limited liability partnership or limited liability
limited partnership, the general partner or managing member of such Person, as
the case may be.
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"Bankruptcy Law" means Title 11, United States Bankruptcy Code of
1978, as amended, or any similar United States federal or state law relating to
bankruptcy, insolvency, receivership, winding up, liquidation, reorganization or
relief of debtors, or any amendment to, succession to or change in any such law.
"Board of Directors" means the board of directors, advisory committee,
management committee or similar governing body or any authorized committee
thereof responsible for the management of the business and affairs of any
Person.
"Board Resolution" means, with respect to any Person, a duly adopted
resolution of the Board of Directors of such Person.
"Borrowing Base" means, as of any date, an amount equal to the sum of
(i) 60% of the aggregate book value of inventory (adjusted to include any LIFO
reserves) and (ii) 85% of the aggregate book value of all accounts receivable
(net of bad debt expense) of the Issuer and its Restricted Subsidiaries on a
consolidated basis, as determined in accordance with GAAP consistently applied.
To the extent that information is not available as to the amount of inventory or
accounts receivable as of a specific date, the Issuer may use the most recent
available information for purposes of calculating the Borrowing Base.
"Business Day" means a day that is not a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital lease
that would at such time be required to be capitalized on a balance sheet in
accordance with GAAP.
"Capital Stock" means (i) in the case of a corporation, corporate
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock, (iii) in the case of a partnership or limited
liability company, partnership or membership interests (whether general or
limited) and (iv) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.
"Cash Equivalents" means (i) United States dollars and any other
currency that is convertible into U.S. dollars without legal restrictions and
which is utilized by the Issuer or any Restricted Subsidiary in the ordinary
course of its business, (ii) securities issued or directly and fully guaranteed
or insured by the United States government or any agency or instrumentality
thereof having maturities of not more than one year from the date of
acquisition, (iii) certificates of deposit and eurodollar time
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deposits with maturities of one year or less from the date of acquisition,
bankers' acceptances with maturities not exceeding one year and overnight bank
deposits, in each case with any lender party to the Senior Credit Facility or
with any domestic or foreign commercial bank having capital and surplus in
excess of $500 million and a Keefe Bank Watch Rating of "B" or better (or,
solely in the case of foreign commercial banks, a substantially equivalent
rating from any similarly recognized rating agency publishing ratings of such
banks), (iv) repurchase obligations with a term of not more than seven days for
underlying securities of the types described in clauses (ii) and (iii) above
entered into with any financial institution meeting the qualifications specified
in clause (iii) above, (v) commercial paper having the highest rating obtainable
from Moody's Investors Service, Inc. or Standard & Poor's Corporation and in
each case maturing within one year after the date of acquisition, and (vi) money
market, mutual or similar funds registered under the Investment Issuer At of
1940, as amended, having assets in excess of $100.0 million and substantially
all of whose investments are comprised of securities of the type described in
clauses (i) through (v) above.
"Certificated Securities" has the meaning provided in Section 2.01.
"Change of Control" means the occurrence of any of the following: (i)
the sale, lease, transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related transactions, of all or
substantially all of the assets of the Issuer and its Subsidiaries taken as a
whole to any "person" (as such term is used in Section 13(d)(3) of the Exchange
Act), or group of related persons, together with any affiliates thereof (other
than Permitted Holders), (ii) the adoption by the Issuer of a plan relating to
the liquidation or dissolution of the Issuer, (iii) the first day on which a
majority of the members of the Board of Directors of the Issuer or the Parent
(so long as the Parent beneficially owns a majority of any class of the Voting
Stock of the Issuer) are not Continuing Directors, or (iv) the consummation of
any transaction (including, without limitation, any merger or consolidation) the
result of which is that any "person" (as defined above) or group of related
persons, together with any affiliates thereof (other than Permitted Holders)
becomes the "beneficial owner" (as such term is defined in Rule 13d-3 and Rule
13d-5 under the Exchange Act), directly or indirectly, of more than 35% of the
Voting Stock of the Issuer or the Parent (measured by voting power rather than
number of shares) provided that the Permitted Holders "beneficially own" (as
such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act),
directly or indirectly, in the aggregate a lesser percentage of the Voting Stock
of the Issuer or the Parent (so long as the Parent beneficially owns a majority
of any class of the Voting
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Stock of the Issuer) than such other Person and do not have the right or ability
by voting power, contract or otherwise to elect or designate for election a
majority of the Board of Directors of the Issuer and the Parent (so long as the
Parent beneficially owns a majority of any class of the Voting Stock of the
Issuer).
"Change of Control Date" has the meaning provided in Section 4.15.
"Change of Control Offer" has the meaning provided in Section 4.15.
"Change of Control Payment Date" has the meaning provided in Section
4.15.
"Consolidated Cash Flow" means, with respect to any Person for any
period, the Consolidated Net Income of such Person for such period plus, without
duplication, (i) an amount equal to any extraordinary loss plus any net loss
realized in connection with an Asset Sale (to the extent such losses were
deducted in computing such Consolidated Net Income), plus (ii) provision for
taxes based on income or profits of such Person and its Subsidiaries for such
period, to the extent that such provision for taxes was included in computing
such Consolidated Net Income, plus (iii) consolidated interest expense of such
Person and its Subsidiaries for such period (including, without limitation,
amortization of debt issuance costs) to the extent that any such expense was
deducted in computing such Consolidated Net Income, plus (iv) depreciation,
amortization (including amortization of goodwill and other intangibles) and
other non-cash charges or expenses (excluding any such non-cash charge or
expense to the extent that it represents an accrual of or reserve for cash
expenses in any future period or amortization of a prepaid cash expense that was
paid in a prior period) of such Person and its Subsidiaries for such period to
the extent that such depreciation, amortization and other non-cash charges or
expenses were deducted in computing such Consolidated Net Income, plus (v) the
Loss Provision, minus (vi) other non-recurring non-cash items increasing such
Consolidated Net Income for such period (which will be added back to
Consolidated Cash Flow in any subsequent period to the extent cash is received
in respect of such item in such subsequent period), in each case, on a
consolidated basis and determined in accordance with GAAP. Notwithstanding the
foregoing, ''Consolidated Cash Flow'' shall be calculated without giving effect
to (i) the amortization of any premiums, fees or expenses incurred in connection
with any acquisition permitted under this Indenture and any related financings
and (ii) the amortization or depreciation of any amounts required or permitted
by Accounting Principles Board Opinion Nos. 16 (including non-cash write-ups and
non-cash charges relating to inventory and fixed assets, in each case arising in
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connection with any such acquisition) and 17 (including non-cash charges
relating to intangibles and goodwill arising in connection with any such
acquisition).
"Consolidated Fixed Charge Coverage Ratio" means with respect to any
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Consolidated Fixed Charges of such Person for such
period. In the event that the Issuer or any of its Restricted Subsidiaries
incurs, assumes, Guarantees or redeems any Debt (other than revolving credit
borrowings) or issues Preferred Stock subsequent to the commencement of the
period for which the Consolidated Fixed Charge Coverage Ratio is being
calculated but prior to the date on which the event for which the calculation of
the Consolidated Fixed Charge Coverage Ratio is made (the "Calculation Date"),
then the Consolidated Fixed Charge Coverage Ratio shall be calculated giving pro
forma effect to such incurrence, assumption, Guarantee or redemption of Debt, or
such issuance or redemption of Preferred Stock, as if the same had occurred at
the beginning of the applicable four-quarter reference period. In addition, for
purposes of making the computation referred to above, (i) acquisitions that have
been made by the Issuer or any of its Restricted Subsidiaries, including through
mergers or consolidations and including any related financing transactions,
during the four-quarter reference period or subsequent to such reference period
and on or prior to the Calculation Date shall be deemed to have occurred on the
first day of the four-quarter reference period and Consolidated Cash Flow for
such reference period shall be calculated without giving effect to clause (iii)
of the proviso set forth in the definition of Consolidated Net Income, and (ii)
the Consolidated Cash Flow attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, shall be excluded, and (iii) the Consolidated
Fixed Charges attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses disposed of prior to the
Calculation Date, shall be excluded, but only to the extent that the obligations
giving rise to such Consolidated Fixed Charges will not be obligations of the
referent Person or any of its Subsidiaries following the Calculation Date. In
calculating "Consolidated Fixed Charges" for purposes of determining the
denominator (but not the numerator) of this "Consolidated Fixed Charge Coverage
Ratio," (l) interest on Debt determined on a fluctuating basis as of the
Calculation Date and which will continue to be so determined thereafter shall be
deemed to have accrued at a fixed rate per annum equal to the rate of interest
on such Debt in effect on the Calculation Date; (2) if interest on any Debt
actually incurred on the Calculation Date may be optionally determined at an
interest rate based upon a factor of a prime or similar rate, a eurocurrency
interbank offered rate or other rates, then the interest rate in effect in the
Calculation
-7-
Date will be deemed to have been in effect during the relevant four-quarter
period reference; and (3) notwithstanding the foregoing, interest on Debt
determined on a fluctuating basis, to the extent such interest is covered by
agreements relating to interest swap agreements, shall be deemed to accrue at
the rate per annum resulting after giving effect to the operation of such
agreements.
"Consolidated Fixed Charges" means, with respect to any Person for any
period, the sum, without duplication, of (i) the consolidated interest expense
of such Person and its Subsidiaries for such period, whether paid or accrued
(including, without limitation, amortization of debt issuance costs (other than
those debt issuance costs incurred on the Issue Date in connection with the
offering of the Securities and the Senior Credit Facility) and original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net payments (if any) pursuant
to Hedging Obligations), (ii) the consolidated interest expense of such Person
and its Subsidiaries that was capitalized during such period, (iii) any interest
expense on Debt of another Person that is Guaranteed by such Person or one of
its Subsidiaries or secured by a Lien on assets of such Person or one of its
Subsidiaries (whether or not such Guarantee or Lien is called upon) and (iv) the
product of (a) all dividend payments, whether or not in cash, on any series of
Preferred Stock of such Person or any of its Subsidiaries, other than dividend
payments on Equity Interests payable solely in Equity Interests of the Issuer,
times (b) a fraction, the numerator of which is one and the denominator of which
is one minus the then current combined federal, state and local statutory tax
rate of such Person, expressed as a decimal, in each case, on a consolidated
basis and in accordance with GAAP.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Subsidiaries
(other than in the case of the Issuer and its Subsidiaries, Unrestricted
Subsidiaries) for such period, on a consolidated basis, determined in accordance
with GAAP; provided that (i) the Net Income (but not loss) of any Person that is
not a Subsidiary or that is accounted for by the equity method of accounting
shall be included only to the extent of the amount of dividends or distributions
paid in cash to the referent Person or a Wholly Owned Subsidiary thereof (other
than in the case of the Issuer and its Subsidiaries, Unrestricted Subsidiaries),
(ii) the Net Income of any Subsidiary shall be excluded to the extent that the
declaration or payment of dividends or similar distributions by
-8-
that Subsidiary of that Net Income is not at the date of determination permitted
without any prior governmental approval (that has not been obtained) or,
directly or indirectly, by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Subsidiary or its stockholders, (iii) the Net
Income of any Person acquired in a pooling of interests transaction for any
period prior to the date of such acquisition shall be excluded, (iv) the
cumulative effect of a change in accounting principles shall be excluded, (v)
all extraordinary gains and extraordinary losses and any unusual or non-
recurring charges recorded or accrued in connection with the Transactions (as
defined in the Final Offering Memorandum)(including any such fees and expenses
relating to the Transactions (as defined in the Final Offering Memorandum) and
the Exchange Offer (as defined in the Registration Rights Agreement)), shall be
excluded, and (vi) the Consolidated Net Income of the Issuer and its
Subsidiaries shall include (without duplication) the Net Income of any
Unrestricted Subsidiary if, and only to the extent that, such Net Income has
been distributed in cash to the Issuer or any of its Restricted Subsidiaries.
"Consolidated Net Worth" means, with respect to any Person as of any
date, the sum of (i) the consolidated equity of the ordinary shareholders of
such Person and its consolidated Subsidiaries as of such date and (ii) the
respective amounts reported on such Person's balance sheet as of such date with
respect to any series of Preferred Stock (other than Disqualified Stock) that by
its terms is not entitled to the payment of dividends unless such dividends may
be declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such Preferred Stock, less (x) all write-ups (other than
write-ups resulting from foreign currency translations and write-ups of tangible
assets of a going concern business made within 12 months after the acquisition
of such business) subsequent to the date of this Indenture in the book value of
any asset owned by such Person or a consolidated Subsidiary of such Person, (y)
all investments as of such date in unconsolidated Subsidiaries and in Persons
that are not Subsidiaries (except, in each case, Permitted Investments), and (z)
all unamortized debt discount and expense and unamortized deferred charges as of
such date, all of the foregoing determined in accordance with GAAP.
"Continuing Director" means, as of any date of determination, any
member of the Board of Directors of the Issuer or the Parent (so long as the
Parent beneficially owns a majority of any class of the Voting Stock of the
Issuer) who (i) was a member of such Board of Directors on the date of this
Indenture, (ii) was nominated for election or elected to such Board of
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Directors with the approval of a majority of the Continuing Directors who were
members of such Board at the time of such nomination or election or (iii) was
nominated for election or elected to such Board of Directors by or with the
approval of the Permitted Holders.
"Credit Facilities" means, with respect to the Issuer or any
Subsidiary, one or more debt facilities (including, without limitation, the
Senior Credit Facility) or commercial paper facilities with banks or other
lenders providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such receivables), bankers
acceptance or letters of credit, in each case, as amended, restated, modified,
renewed, refunded, replaced or refinanced in whole or in part from time to time.
Debt under Credit Facilities outstanding on the date on which Securities are
first issued and authenticated under this Indenture shall be deemed to have been
incurred on such date in reliance on the exception provided by clause (i) of the
definition of Permitted Debt.
"Currency Agreement" means any foreign exchange contract, currency
swap agreement or other similar agreement or arrangement to which the Issuer or
any Subsidiary of the Issuer, is a party designed to protect the Issuer or any
Subsidiary of the Issuer, against fluctuations in currency values.
"Custodian" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"Debt" means, with respect to any Person, any indebtedness of such
Person, whether or not contingent, in respect of borrowed money or evidenced by
bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof) or banker's acceptances or
representing Capital Lease Obligations or the balance deferred and unpaid of the
purchase price of any property or representing any Hedging Obligations, except
any such balance that constitutes an accrued expense or trade payable, if and to
the extent any of the foregoing indebtedness (other than letters of credit and
Hedging Obligations) would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, as well as all Debt of others secured
by a Lien on any asset of such Person (whether or not such Debt is assumed by
such Person) and, to the extent not otherwise included, the Guarantee by such
Person of any Debt of any other Person. The amount of any Debt outstanding as of
any date shall be (i) the accrued value thereof, in the case of any Debt that
does not require current payments of interest, and (ii) the
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principal amount thereof, together with any interest thereon that is more than
30 days past due, in the case of any other Debt.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Depositary" means, with respect to the Securities issued in the form
of one or more Global Securities, The Depository Trust Company or another Person
designated as Depositary by the Issuer, which must be a clearing agency
registered under the Exchange Act.
"Designated Senior Debt" means (i) any Debt under the Senior Credit
Facility and (ii) any other Senior Debt permitted hereunder the principal amount
of which is $10.0 million or more and that has been expressly designated by the
Issuer in such Senior Debt instrument as "Designated Senior Debt."
"Disposition" means, with respect to any Person, any merger,
consolidation or other business combination involving such Person (whether or
not such Person is the Surviving Person) or the sale, assignment, transfer,
lease, conveyance or other disposition of all or substantially all of such
Person's assets.
"Disqualified Stock" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the Holder thereof, in whole or in part, on or prior to the first
anniversary of the Stated Maturity of the Securities.
"Equity Interests" means Capital Stock and all warrants, options or
other rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Equity Offering" means a bona fide underwritten sale to the public of
Equity Interests (other than Disqualified Stock) of the Issuer or of the Parent
(to the extent the Net Proceeds thereof are contributed to the Issuer as common
equity) pursuant to a registration statement (other than on Form S-8 or any
other form relating to securities issuable under any benefit plan of the Issuer
or the Parent, as the case may be) that is declared effective by the SEC.
"Existing Debt" means the principal amount of Debt of the Issuer and
its Subsidiaries (other than Debt under the Senior Credit Facility) in existence
on the date of this Indenture, until such amounts are repaid.
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"Event of Default" has the meaning provided in Section 6.01.
"Excess Proceeds" has the meaning provided in Section 4.16(b).
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the SEC thereunder.
"Exchange Securities" means a series of securities having terms
substantially identical to the Securities issued pursuant to an Exchange Offer
(as defined in the Registration Rights Agreement) for the Securities.
"Final Offering Memorandum" means the Offering Memorandum dated
September 12, 1997 relating to the offering of the Securities.
"Funding Guarantor" has the meaning provided in Section 11.06.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect.
"Global Security" means a security evidencing all or a part of the
Securities issued to the Depositary in accordance with Section 2.01 and bearing
the legend prescribed in Exhibit B.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any Debt.
"Guarantor" means each of the Issuer's Restricted Domestic
Subsidiaries that executes a supplemental indenture in which such Restricted
Domestic Subsidiaries agree to be bound by the terms of this Indenture as a
Guarantor; provided that any Person constituting a Guarantor as described above
shall cease to constitute a Guarantor when its respective Guarantee is released
in accordance with the terms of this Indenture.
"Guarantor Blockage Period" means a period commencing on the date of
receipt by the Trustee of a Guarantor Default Notice
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and ending on the earliest of the dates referred to in clauses (a), (b), (c) or
(d) of clause (y) of the second sentence of Section 12.02(a).
"Guarantor Default Notice" has the meaning provided in Section 12.02.
"Guarantor Senior Debt" means the principal of, premium, if any, and
interest (including any interest accruing subsequent to the filing of a petition
of bankruptcy at the rate provided for in the documentation with respect
thereto, whether or not such interest is an allowed claim under applicable law)
on, and all other obligations with respect to, any Debt of a Guarantor, whether
outstanding on the Issue Date or thereafter created, incurred or assumed,
unless, in the case of any particular Debt, the instrument creating or
evidencing the same or pursuant to which the same is outstanding expressly
provides that such Debt shall not be senior in right of payment to the
Guarantees. Without limiting the generality of the foregoing, "Guarantor Senior
Debt" shall also include the principal of, premium, if any, interest (including
any interest accruing subsequent to the filing of a petition of bankruptcy at
the rate provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) on, and all other
amounts owing in respect of, (x) all monetary obligations of every nature of a
Guarantor under (or in respect of) the Senior Credit Facility, including,
without limitation, (a) obligations to pay principal and interest, reimbursement
obligations under letters of credit, fees, expenses and indemnities and (b)
guarantees by a Guarantor of Obligations under the Senior Credit Facility where
the direct borrower is the Issuer or a Subsidiary of the Issuer, (y) all
Interest Swap Obligations and (z) all obligations under Currency Agreements, in
each case whether outstanding on the Issue Date or thereafter incurred.
Notwithstanding the foregoing, Guarantor Senior Debt shall not include (i) any
Debt, if the instrument creating or evidencing the same or the assumption or
guarantee thereof expressly provides that such Debt shall not be senior in right
of payment to the Guarantees, (ii) any Debt of a Guarantor to a Subsidiary of
such Guarantor, (iii) Debt to, or guaranteed on behalf of, any director, officer
or employee of a Guarantor or any Subsidiary of a Guarantor (including, without
limitation, amounts owed for compensation), (iv) Debt to trade creditors and
other amounts incurred in connection with obtaining goods, materials or
services, (v) Debt represented by Disqualified Equity Interests, (vi) any
liability for federal, state, local or other taxes owed or owing by a Guarantor,
(vii) that portion of any Debt incurred in violation of the provisions set forth
in Section 4.12(a) (but, as to any such obligation, no such violation shall be
deemed to exist for purposes of this clause (vii) if the holder(s) of such
obligation or their representative and the Trustee shall have
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received an Officers' Certificate of the Issuer to the effect that the
incurrence of such Debt does not (or, in the case of revolving credit Debt, that
the incurrence of the entire committed amount thereof at the date on which the
initial borrowing thereunder is made) would not violate such provisions of this
Indenture), and (viii) any Debt which is, by its express terms, subordinated in
right of payment to any other Debt of a Guarantor.
"Guarantor Subordinated Debt" means any Debt of any Guarantor which is
by its terms subordinated in right of payment to the Obligations under such
Guarantor's Guarantee of the Securities.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) currency exchange or interest rate swap
agreements, interest rate cap agreements and interest rate collar agreements, or
(ii) other agreements or arrangements designed to protect such Person against
fluctuations in interest rates or currency exchange rates.
"Holder" or "Securityholder" means the Person in whose name a Security
is registered on the Registrar's books.
"IAI Securities" means Securities resold by the Initial Purchasers to
an Institutional Accredited Investor.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Initial Purchasers" means BancAmerica Securities, Inc. and Salomon
Brothers Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"interest" means interest payable on the Securities under this
Indenture and interest payable under the Registration Rights Agreement.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Securities.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including guarantees of Debt or other obligations), advances or
capital contributions (excluding commissions, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Debt, Equity Interests or other
securities, together with all items that are or would be
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classified as investments on a balance sheet prepared in accordance with GAAP.
If the Issuer or any Restricted Subsidiary of the Issuer sells or otherwise
disposes of any Equity Interests of any direct or indirect Subsidiary of the
Issuer such that, after giving effect to any such sale or disposition, such
Person is no longer a Restricted Subsidiary of the Issuer, the Issuer shall be
deemed to have made an Investment on the date of any such sale or disposition
equal to the fair market value of the Equity Interests of such Subsidiary not
sold or disposed of in an amount determined as provided under Section 4.10.
"Issue Date" means the date upon which the Securities are originally
issued under this Indenture.
"Issuer" has the meaning provided in the preamble.
"Kilovac" has the meaning provided in the preamble.
"Kilovac International" has the meaning provided in the preamble.
"Legal Holiday" has the meaning provided in Section 13.07.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Loss Provision" means the provision for loss recorded by the Issuer
in the quarter ended June 30, 1997 for certain receivables.
"Management Agreement" means the Management Agreement among the
Issuer, the Parent and CHS Management III, L.P. as in effect on the date hereof
or as thereafter amended in a manner that is not adverse to the Holders of the
Securities.
"Maturity Date" means September 15, 2004.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction in
respect of preferred stock dividends, excluding, however, (i) any gain (but not
loss), together with any related provision for taxes on such gain (but not
loss), realized
-15-
in connection with (a) any Asset Sale (including, without limitation,
dispositions pursuant to sale and leaseback transactions) or (b) the disposition
of any securities by such Person or any of its Subsidiaries or the
extinguishment of any Debt of such Person or any of its Subsidiaries and (ii)
any extraordinary or nonrecurring gain (but not loss), together with any related
provision for taxes on such extraordinary or nonrecurring gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Issuer or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
(i) the direct costs relating to such Asset Sale (including, without limitation,
legal, accounting and investment banking fees, and sales commissions) and any
relocation expenses incurred as a result thereof, (ii) taxes paid or payable as
a result thereof (after taking into account any available tax credits or
deductions and any tax sharing arrangements), (iii) any reserve for adjustment
in respect of the sale price of such asset or assets established in accordance
with GAAP, or against any liabilities associated with the Asset Sale, or the
assets subject thereto, and retained by the Issuer or any Restricted Subsidiary,
and (iv) amounts required to be applied to the repayment of Debt secured by a
Lien on the asset or assets that were the subject of such Asset Sale, or to the
satisfaction of contractual obligations either existing at the date of this
Indenture, or entered into after the date of this Indenture in connection with
the payment of deferred purchase price of the properties or assets that were the
subject of such Asset Sale.
"Non-U.S. Person" means a Person who is not a "U.S. Person."
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Debt.
"Officer" means, with respect to any Person (other than any Agent),
the Chairman of the Board, the Chief Executive Officer, the President, the Chief
Operating Office, any Vice President, the Chief Financial Officer, the
Treasurer, the Assistant Treasurer, the Controller, the Secretary or an
Assistant Secretary of such Person or with respect to a Person (other than any
Agent) organized as a partnership, limited liability partnership or limited
liability limited partnership, the general partner of such Person.
"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person and otherwise
complying with the requirements of Sections
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13.04 and 13.05, as they relate to the making of an Officers' Certificate.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee complying with the requirements of Section
13.05, as they relate to the giving of an Opinion of Counsel.
"Original Securities" has meaning provided in Section 2.02.
"Parent" means CII Technologies Inc. and its successors and assigns.
"Pari Passu Debt" shall mean (i) any Debt of the Issuer that is pari
passu in right of payment to the Securities and (ii) with respect to any
Guarantee of the Securities, Debt which ranks pari passu in right of payment to
such Guaranty.
"Paying Agent" has the meaning provided in Section 2.03, except that,
during the continuance of a Default or Event of Default and for the purposes of
Articles Three and Eight and Sections 4.15 and 4.16, the Paying Agent shall not
be the Issuer or any Affiliate of the Issuer.
"Payment Blockage Notice" has the meaning provided in Section
10.02(a).
"Payment Blockage Period" means a period commencing on the date of
receipt by the Trustee of a Payment Blockage Notice and ending on the earliest
of the dates referred to in clauses (a), (b), (c) or (d) of clause (y) of the
second sentence of Section 10.02(a).
"Pari Passu Debt Amount" shall have the definition set forth under
Section 4.16(c).
"Permitted Debt" has the meaning provided in Section 4.12(b).
"Permitted Holders" means Code, Hennessy & Simmons, Inc., Code,
Hennessy & Simmons III, L.P., and their respective Affiliates.
"Permitted Investments" means (a) any Investment in the Issuer or in a
Restricted Subsidiary of the Issuer that is engaged in the same or a similar
line of business as the Issuer and its Restricted Subsidiaries (or reasonable
extensions or expansions thereof or businesses ancillary thereto); (b) any
Investment in Cash Equivalents; (c) any Investment by the Issuer or any
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Restricted Subsidiary of the Issuer in a Person, if as a result of such
Investment (i) such Person becomes a Restricted Subsidiary of the Issuer that is
engaged in the same or a similar line of business as the Issuer and its
Restricted Subsidiaries (or reasonable extensions or expansions thereof or
businesses ancillary thereto) or (ii) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially all of its
assets to, or is liquidated into, the Issuer or a Restricted Subsidiary of the
Issuer that is engaged in the same or a similar line of business as the Issuer
and its Restricted Subsidiaries (or reasonable extensions or expansions thereof
or businesses ancillary thereto); (d) any Restricted Investment made as a result
of the receipt of non-cash consideration from an Asset Sale that was made
pursuant to and in compliance with Section 4.16; (e) any acquisition of assets
solely in exchange for the issuance of Equity Interests (other than Disqualified
Stock) of the Issuer; (f) Investments made in exchange for accounts receivable
arising in the ordinary course of business which have not been collected for 180
days and which are, in the good faith of the Issuer, substantially
uncollectible, provided that any such Investments in excess of $500,000 shall be
approved by the Board of Directors (evidenced by a resolution of the Board of
Directors set forth in an Officers' Certificate delivered to the Trustee); (g)
Investments constituting loans or advances to employees and officers of the
Issuer and its Restricted Subsidiaries (i) in the ordinary course of business
for bona fide business purposes or (ii) in connection with the purchase of
Equity Interests of the Parent or the Issuer, provided that the aggregate amount
of Investments outstanding under this clause (g) does not exceed $1.0 million at
any one time; (h) Investments in Permitted Joint Ventures, and Investments in
suppliers to the Issuer and its Restricted Subsidiaries, in an aggregate amount
when taken together with all other Investments pursuant to this clause (h) does
not exceed the greater of $3.0 million or 5% of Total Assets at any one time
outstanding; (i) Guarantees by the Issuer of Debt otherwise permitted to be
incurred by Restricted Subsidiaries of the Issuer, permitted by clause (x) of
Permitted Debt or permitted by Section 4.18; (j) Hedging Obligations entered
into in the ordinary course of the Issuer's or any of its Restricted
Subsidiaries' businesses and otherwise in compliance with this Indenture; and
(k) other Investments in any Person having an aggregate fair market value
(measured on the date each such Investment was made and without giving effect to
subsequent changes in value), when taken together with all other Investments
made pursuant to this clause (k) that are at the time outstanding, not to exceed
$2.0 million. For purposes of calculating the aggregate amount of Permitted
Investments permitted to be outstanding at any one time pursuant to clauses (h)
and (k) of the preceding sentence, (i) to the extent the consideration for any
such Investment consists of Equity Interests (other than Disqualified Stock) of
the Issuer, the value of the Equity Interests so issued will be ignored
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in determining the amount of such Investment and (ii) the aggregate amount of
such Investments made by the Issuer and its Restricted Domestic Subsidiaries on
or after the date of this Indenture will be decreased (but not below zero) by an
amount equal to the lesser of (w) the cash return of capital to the Issuer or a
Restricted Domestic Subsidiary with respect to such Investment that is sold for
cash or otherwise liquidated or repaid for cash (less the cost of disposition,
including applicable taxes, if any) and (x) the initial amount of such
Investment.
"Permitted Joint Venture" means any Person which is, directly or
indirectly through its Subsidiaries or otherwise, engaged principally in the
principal business of the Issuer, or a reasonably related business, and the
Capital Stock of which is owned by the Issuer and one or more Persons other than
the Issuer or any affiliate of the Issuer.
"Permitted Junior Securities" means Equity Interests in the Issuer or
unsecured debt securities of the Issuer that are subordinated to all Senior Debt
(and any debt securities issued in exchange for Senior Debt) to the same extent
as, or to a greater extent than, the Securities are subordinated to Senior Debt
under this Indenture and which, in any case, do not mature or become subject to
a mandatory redemption obligation prior to the maturity of the Securities and do
not cause the Securities to be treated in any case or proceeding or similar
event under any bankruptcy or insolvency law as part of the same class of claims
as the Senior Debt.
"Permitted Refinancing Debt" means any Debt of the Issuer or any of
its Restricted Subsidiaries issued in exchange for, or the net proceeds of which
are used to extend, refinance, renew, replace, defease or refund other Debt of
the Issuer or any of its Restricted Subsidiaries; provided that: (i) the
principal amount (or accrued value, if applicable) of such Permitted Refinancing
Debt does not exceed the principal amount of (or accrued value, if applicable),
plus accrued interest on, the Debt so extended, refinanced, renewed, replaced,
defeased or refunded (plus the amount of reasonable expenses incurred in
connection therewith); (ii) such Permitted Refinancing Debt has a final maturity
date later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Debt being extended, refinanced, renewed, replaced, defeased or refunded; (iii)
if the Debt being extended, refinanced, renewed, replaced, defeased or refunded
is subordinated in right of payment to the Securities, such Permitted
Refinancing Debt has a final maturity date later than the final maturity date
of, and is subordinated in right of payment to, the Securities on terms at least
as favorable to the Holders of Securities as those contained in the
documentation governing the Debt being extended,
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refinanced, renewed, replaced, defeased or refunded; and (iv) such Debt is
incurred either by the Issuer or by the Restricted Subsidiary who is the obligor
on the Debt being extended, refinanced, renewed, replaced, defeased or refunded.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Preferred Stock" of any Person means any Equity Interest of such
Person that has preferential rights to any other Equity Interest of such Person
with respect to dividends or redemptions or upon liquidation.
"principal" of any Debt (including the Securities) means the principal
amount of such Debt plus the premium, if any, on such Debt.
"Private Placement Legend" means the legend initially set forth on the
Securities in the form set forth in Exhibit A-1.
"pro forma" means, with respect to any calculation made or required to
be made pursuant to the terms of this Indenture, a calculation in accordance
with Article 11 of Regulation S-X under the Securities Act.
"Purchase Money Obligations" of a Person means Debt of such Person
incurred in connection with the purchase, construction or improvement of
property, plant or equipment used in the business of such Person.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Redemption Date" means, with respect to any Securities, the Maturity
Date of such Security or the earlier date on which such Security is to be
redeemed by the Issuer pursuant to the terms of the Securities.
"Redemption Price" shall have the meaning provided in Section 3.01.
"Registrar" has the meaning provided in Section 2.03.
"Registration Agreement" means the Registration Agreement among the
stockholders of the Parent as in effect on the date of this Indenture or as
thereafter amended in a manner that is not adverse to the Issuer or the Holders
of the Securities.
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"Registration Rights Agreement" means the Registration Rights
Agreement dated as of the date hereof among the Issuer, the Guarantors and the
Initial Purchasers.
"Regulation S" means Regulation S under the Securities Act.
"Related Person" means with respect to any Person (a) any Affiliate of
such Person, (b) any individual or other Person who directly or indirectly is
the registered or beneficial owner of 5% or more of any class of Capital Stock
of such Person or warrants, rights, options or other rights to acquire more than
5% of any class of Capital Stock of such Person, (c) any relative of such
individual by blood, marriage or adoption not more remote than first cousin and
(d) any officer or director of such Person.
"Related Person Transaction" has the meaning provided in Section 4.11.
"Representative" means the indenture trustee or other trustee, agent
or representative in respect of any Senior Debt; provided that if, and for so
long as, any Senior Debt lacks such a representative, then the Representative
for such Senior Debt shall at all times constitute the holders of a majority in
outstanding principal amount of such Senior Debt.
"Required Filing Dates" has the meaning provided in Section 4.08.
"Restricted Domestic Subsidiary" means a Restricted Subsidiary
organized and validly existing under the laws of the United States or any state
thereof or the District of Columbia.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Payment" means (i) any dividend or any other payment or
distribution on account of the Issuer's or any of its Restricted Subsidiaries'
Equity Interests or to the direct or indirect holders of the Issuer's or any of
its Restricted Subsidiaries' Equity Interests in their capacity as such (other
than dividends or distributions payable in Equity Interests (other than
Disqualified Stock) of the Issuer or such Restricted Subsidiary or dividends or
distributions payable to the Issuer or any Wholly Owned Subsidiary); (ii) any
payment to purchase, redeem or otherwise acquire or retire for value any Equity
Interests of the Issuer, any direct or indirect parent of the Issuer or any
Restricted Subsidiary of the Issuer (other than any Equity Interests owned by
the Issuer or any Wholly Owned Subsidiary); (iii) any payment to purchase,
redeem, defease or otherwise acquire
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or retire for value any Subordinated Debt of the Issuer or a Restricted
Subsidiary, except a payment of interest or principal at Stated Maturity; and
(iv) any Restricted Investment.
"Restricted Security" has the meaning set forth in Rule 144(a)(3)
under the Securities Act; provided, that the Trustee or the Registrar shall be
entitled to request and conclusively rely upon an Opinion of Counsel with
respect to whether any Security is a Restricted Security.
"Restricted Subsidiary" of any Person means any Subsidiary of such
Person which at the time of determination is not an Unrestricted Subsidiary.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Issuer's 10% Senior Subordinated Notes due
2004, as amended or supplemented from time to time in accordance with the terms
hereof, that are issued pursuant to this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Security Amount" has the meaning provided in Section 4.16(c).
"Securityholder" or "Holder" means the Person in whose name a Security
is registered on the Registrar's books.
"Senior Credit Facility" means, collectively, the Credit Agreement
dated as of September 18, 1997, among the Parent, the Issuer, the lenders party
thereto in their capacity as such, BancAmerica Securities, Inc., as arranger,
and Bank of America National Trust and Savings Association, as administrative
agent, together with the related documents thereto (including, without
limitation, any guarantee agreements and security documents), in each case as
such agreements may be amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time, including any
agreement extending the maturity of, refinancing, replacing or otherwise
restructuring (including, without limitation, increasing the amount of available
borrowings thereunder or adding Subsidiaries of the Issuer as additional
borrowers or guarantors thereunder) all or any portion of the indebtedness under
such agreement or any successor or replacement agreement, whether by the same or
any other agent, lender or group of lenders, whether contained in one or more
agreements.
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"Senior Debt" means (i) all Debt of the Issuer outstanding under the
Credit Facilities and all Hedging Obligations with respect thereto (including,
but not limited to, the principal of, premium, if any, interest (including any
interest accruing subsequent to a filing of a petition of bankruptcy at the rate
provided for in documentation with respect thereto, whether or not such interest
is an allowed claim under applicable law) on, reimbursement obligations under
letters of credit issued under, and fees, expenses, indemnities and other
amounts owing in respect of, the foregoing Debt), (ii) any other Debt permitted
to be incurred by the Issuer under the terms of this Indenture, unless the
instrument under which such Debt is incurred expressly provides that it is on a
parity with or subordinated in right of payment to the Securities and (iii) all
Obligations with respect to the foregoing. Notwithstanding anything to the
contrary in the foregoing, Senior Debt will not include (w) any liability for
federal, state, local or other taxes owed or owing by the Issuer, (x) any Debt
of the Issuer to any of its Subsidiaries or other Affiliates, (y) any trade
payables or (z) that portion of any Debt that is incurred in violation of this
Indenture (but, as to any such obligation, no such violation shall be deemed to
exist for purposes of this clause (z) if the holder(s) of such obligation or
their representative and the Trustee shall have received an Officers'
Certificate of the Issuer to the effect that the incurrence of such Debt does
not (or, in the case of revolving credit Debt, that the incurrence of the entire
committed amount thereof at the date on which the initial borrowing thereunder
is made) would not violate such provisions of this Indenture).
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Act, as such Regulation is in effect on the date
hereof.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Debt, the date on which such payment of interest
or principal was scheduled to be paid in the original documentation governing
such Debt, and shall not include any contingent obligations to repay, redeem or
repurchase any such interest or principal prior to the date originally scheduled
for the payment thereof.
"Subordinated Debt" means any Debt of the Issuer which is by its terms
subordinated in right of payment to the Securities.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is
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at the time owned or controlled, directly or indirectly, by such Person or one
or more of the other Subsidiaries of that Person (or a combination thereof) and
(ii) any partnership (a) the sole general partner or the managing general
partner of which is such Person or a Subsidiary of such Person or (b) the only
general partners of which are such Person or of one or more Subsidiaries of such
Person (or any combination thereof).
"Surviving Person" means, with respect to any Person involved in or
that makes any Disposition, the Person formed by or surviving such Disposition
or the Person to which such Disposition is made.
"Tax Sharing Agreement" means the Tax Sharing Agreement among the
Issuer, Parent and certain other Subsidiaries of Parent as in effect on the date
of this Indenture or as thereafter amended in a manner that is not adverse to
the Issuer or the Holders of the Securities.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-
77bbbb), as amended, as in effect on the date on which this Indenture is
qualified under the TIA, except as otherwise provided in Section 9.03.
"Total Assets" means, with respect to any date of determination, the
total assets of the Issuer shown on the Issuer's consolidated balance sheet in
accordance with GAAP on the last day of the fiscal quarter prior to the date of
determination.
"Transfer Amount" has the meaning provided in Section 2.16.
"Trust Officer" means any officer or assistant officer of the Trustee
assigned by the Trustee to administer its corporate trust matters or, in the
case of a successor trustee, an officer assigned to the department, division or
group performing the corporate trust work of such successor.
"Trustee" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.
"Unrestricted Subsidiary" of any Person means (i) any Subsidiary of
such Person that as of the time of determination shall be or continue to be
designated an Unrestricted Subsidiary in the manner provided below and (ii) any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors of the Issuer
may designate any Subsidiary (including any newly acquired or newly formed
Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock of its own or holds any Lien on
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any property of the Issuer or any other Subsidiary of the Issuer that is not a
Subsidiary of the Subsidiary to be so designated; provided that (x) the Issuer
certifies to the Trustee that such designation complies with Section 4.10 and
(y) each Subsidiary to be so designated and each of its Subsidiaries has not at
the time of designation, and does not thereafter, create, incur, issue, assume,
guarantee or otherwise become directly or indirectly liable with respect to any
indebtedness pursuant to which the lender has recourse to any of the assets of
the Issuer or any its Restricted Subsidiaries. The Board of Directors of the
Issuer may designate any Unrestricted Subsidiary to be a Restricted Subsidiary
only if (x) immediately after giving effect to such designation, the Issuer is
able to incur at least $1.00 of additional Debt pursuant to the Consolidated
Fixed Charge Coverage Ratio set forth in Section 4.12(a) and (y) immediately
before and immediately after giving effect to such designation, no Default or
Event of Default shall have occurred and be continuing. Any such designation by
the Board of Directors of the Issuer shall be evidenced to the Trustee by
promptly filing with the Trustee a copy of the Board Resolution giving effect to
such designations and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.
"U.S. Government Obligations" means direct obligations of, and
obligations guaranteed by, the United States of America for the payment of which
the full faith and credit of the United States of America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States
of America as at the time of payment shall be legal tender for the payment of
public and private debts.
"U.S. Person" has the meaning given in Regulation S under the
Securities Act.
"Voting Stock" of any Person as of any date means the Capital Stock of
such Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any Debt at
any date, the number of years obtained by dividing (i) the sum of the products
obtained by multiplying (a) the amount of each then remaining installment,
sinking fund, serial maturity or other required payments of principal including
payment at final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date and
the making of such payment, by (ii) the then outstanding principal amount of
such Debt.
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"Wholly Owned Restricted Subsidiary" of any Person means any
Restricted Subsidiary of such Person that is a Wholly Owned Subsidiary of such
Person.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such
Person all of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned by
such Person or by one or more Wholly Owned Subsidiaries of such Person and one
or more Wholly Owned Subsidiaries of such Person.
SECTION 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"SEC" means the SEC.
"indenture securities" means the Securities.
"indenture securityholder" means a Holder or a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Issuer or any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP as in effect on the Issue Date;
(3) "or" is not exclusive;
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(4) words in the singular include the plural, and words in the plural
include the singular;
(5) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision; and
(6) all references to Articles, Sections and Exhibits shall mean,
unless the clearly indicates otherwise, the Articles and Sections hereof
and the Exhibits attached hereto, the terms of which Exhibits are hereby
incorporated into this Indenture.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Exchange Securities, and the notation relating
to the Trustee's certificate of authentication shall be substantially in the
form of Exhibits A-1 and A-2, respectively. The Securities may have notations,
legends or endorsements required by law, stock exchange rule or usage. The
Issuer and the Trustee shall approve the form of the Securities and any
notation, legend or endorsement on them. Each Security shall be dated the date
of its issuance and shall show the date of its authentication.
The terms and provisions contained in the Securities, annexed hereto
as Exhibits A-1 and A-2, shall constitute, and are hereby expressly made, a part
of this Indenture and, to the extent applicable, the Issuer and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby.
Securities offered and sold in reliance on Rule 144A or in reliance on
any other exemption from registration under the Securities Act may be issued
initially in the form of one or more permanent Global Securities in registered
form, substantially in the form set forth in Exhibit A-1 ("Global Securities"),
deposited with, or on behalf of, the Depositary and registered in the name of
Cede & Co. or such other nominee, as nominee of the Depositary, and shall bear
the legend set forth on Exhibit B. The aggregate principal amount of any Global
Security may from time to time be increased or decreased by adjustments made on
the records of the Depositary and the Registrar, as the custodian for the
Depositary.
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Securities offered and sold in reliance on any exemption from
registration under the Securities Act may be issued in the form of certificated
securities in registered form in substantially the form set forth in Exhibit A-1
(the "Certificated Securities").
SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant Secretary, shall sign, or
one Officer shall sign and one Officer or an Assistant Secretary (each of whom
shall, in each case, have been duly authorized by all requisite corporate
actions) shall attest to, the Securities for the Issuer by manual or facsimile
signature.
If an Officer or Assistant Secretary whose signature is on a Security
was an Officer or Assistant Secretary at the time of such execution but no
longer holds that office or position at the time the Trustee authenticates the
Security, the Security shall nevertheless be valid.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate Securities for original issue in the
aggregate principal amount of up to and including $95.0 million upon receipt of
a written order signed by two Authorized Officers of the Issuer (the "Original
Securities"). The order shall specify the amount of Original Securities to be
authenticated and the date on which the Original Securities are to be
authenticated. The aggregate principal amount of Securities outstanding at any
time may not exceed $125.0 million except as provided in Section 2.07. Upon the
written order of the Issuer in the form of an Officers' Certificate, the Trustee
shall authenticate Securities in substitution of Securities originally issued to
reflect any name change of the Issuer.
The Trustee may appoint an authenticating agent (an "Authenticating
Agent") reasonably acceptable to the Issuer to authenticate Securities. Unless
otherwise provided in the appointment, an Authenticating Agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
Authenticating Agent has the same rights as an Agent to deal with the Issuer and
Affiliates of the Issuer.
The Securities shall be issuable in fully registered form only,
without coupons, in denominations of $1,000 and any integral multiple thereof.
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SECTION 2.03. Registrar and Paying Agent.
The Issuer shall maintain an office or agency in the county where the
principal corporate office of the Trustee is located or in such other locations
as the Issuer shall determine, where (a) Securities may be presented or
surrendered for registration of transfer or for exchange ("Registrar"), (b)
Securities may be presented or surrendered for payment ("Paying Agent") and (c)
notices and demands to or upon the Issuer in respect of the Securities and this
Indenture may be served. The Registrar shall keep a register of the Securities
and of their transfer and exchange. The Issuer, upon notice to the Trustee, may
have one or more co-Registrars and one or more additional paying agents
reasonably acceptable to the Trustee. The term "Paying Agent" includes any
additional paying agent. The Issuer upon notice to the Trustee may change any
Registrar or Paying Agent without notice to any Holder.
The Issuer shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture, which agreement shall implement the
provisions of this Indenture that relate to such Agent. The Issuer shall notify
the Trustee, in advance, of the name and address of any such Agent. If the
Issuer fails to maintain a Registrar or Paying Agent, the Trustee shall act as
such.
The Issuer initially appoints the Trustee as Registrar and Paying
Agent until such time as the Trustee has resigned or a successor has been
appointed.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Issuer shall require each Paying Agent other than the Trustee to
agree in writing that each Paying Agent shall hold in trust for the benefit of
the Holders or the Trustee all assets held by the Paying Agent for the payment
of principal of, or interest on, the Securities (whether such assets have been
distributed to it by the Issuer or any other obligor on the Securities), and
shall notify the Trustee of any default by the Issuer (or any other obligor on
the Securities) in making any such payment. The Issuer, upon written direction
to the Paying Agent, at any time may require a Paying Agent to distribute all
assets held by it to the Trustee and account for any assets disbursed and the
Trustee may at any time during the continuance of any payment Default, upon
written request to a Paying Agent, require such Paying Agent to distribute all
assets held by it to the Trustee and to account for any assets distributed.
Upon distribution to the Trustee of all assets that shall have been delivered by
the Issuer to the Paying Agent and the completion of any accounting required to
be made hereunder, the Paying Agent shall have no further liability for such
assets.
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SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders. If the Trustee is not the Registrar, the Issuer shall furnish to
the Trustee five (5) Business Days before each Interest Payment Date and at such
other times as the Trustee may request in writing a list as of the applicable
record date and in such form as the Trustee may reasonably require of the names
and addresses of the Holders, which list may be conclusively relied upon by the
Trustee.
SECTION 2.06. Transfer and Exchange.
Subject to the provisions of Section 2.15 and 2.16, when Securities
are presented to the Registrar or a co-Registrar with a request to register the
transfer of such Securities or to exchange such Securities for an equal
principal amount of Securities of other authorized denominations, the Registrar
or co-Registrar shall register the transfer or make the exchange as requested if
its requirements for such transaction are met; provided, however, that the
Securities surrendered for transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the Registrar or co-Registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing. To permit registration of transfers
and exchanges, the Issuer shall execute and the Trustee shall authenticate
Securities at the Registrar's or co-Registrar's written request. No service
charge shall be made for any registration of transfer or exchange, but the
Issuer may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than any such
transfer taxes or other governmental charge payable upon exchanges or transfers
pursuant to Section 2.02, 2.10, 3.01(ii), 3.08, 4.16, or 9.05). The Registrar or
co-Registrar shall not be required to register the transfer of or exchange of
any Security (i) during a period beginning at the opening of business 15 days
before the mailing of a notice of redemption of Securities and ending at the
close of business on the day of such mailing, (ii) selected for redemption in
whole or in part pursuant to Article Three, except the unredeemed portion of any
Security being redeemed in part and (iii) during a Change of Control Offer or an
Asset Sale Offer if such Security is tendered pursuant to such Change of Control
Offer or Asset Sale Offer and not withdrawn.
Prior to the registration of any transfer by a Holder, the Issuer, the
Trustee and any agent of the Issuer shall treat the person in whose name the
Security is registered as the owner thereof for all purposes whether or not the
Security shall be overdue, and neither the Issuer, the Trustee nor any such
agent
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shall be affected by notice to the contrary. Any Holder of the Global Security
shall, by acceptance of such Global Security, agree that transfers of beneficial
interests in such Global Security may be effected only through a book-entry
system maintained by the Holder of such Global Security (or, its agent), and
that ownership of a beneficial interest in the Global Security shall be required
to be reflected in a book-entry system.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Issuer shall issue and the Trustee shall authenticate a replacement
Security if the Trustee's requirements are met. Such Holder must provide an
indemnity bond or other indemnity sufficient, in the judgment of the Issuer and
the Trustee, to protect the Issuer, the Trustee or any Agent from any loss which
any of them may suffer if a Security is replaced. The Issuer may charge such
Holder for its reasonable out-of-pocket expenses in replacing a Security,
including reasonable fees and expenses of counsel. Every replacement Security
issued pursuant to this Section 2.07 shall constitute an obligation of the
Issuer.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that have
been authenticated by the Trustee or the Authenticating Agent except those
canceled by the Trustee, those delivered to it for cancellation and those
described in this Section as not outstanding. Subject to Section 2.09, a
Security does not cease to be outstanding because the Issuer or any of its
Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than a
mutilated Security surrendered for replacement), it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Security
is held by a bona fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof pursuant to Section
2.07.
If the principal amount of any Security is considered paid under
Section 4.01, it ceases to be outstanding and interest ceases to accrue.
If on a Redemption Date, Change of Control Payment Date, an Asset Sale
Payment Date or the Maturity Date the Paying Agent holds U.S. Legal Tender or
U.S. Government Obligations sufficient to pay all of the principal, premium, if
any, and interest due on the Securities payable on that date and is not
prohibited from paying such money to the Holders thereof pursuant to the terms
of
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this Indenture, then on and after that date such Securities cease to be
outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver, consent or notice, and for
purposes of determining the amount of Securities outstanding at the time of a
redemption made in accordance with paragraph 6(a)(ii) of the Securities,
Securities owned by the Issuer or an Affiliate of the Issuer shall be considered
as though they are not outstanding, except that for the purposes of determining
whether the Trustee shall be protected in relying on any direction, waiver or
consent, only Securities which the Trustee actually knows are so owned shall be
so considered. The Issuer shall notify the Trustee, in writing, when it or any
of its Affiliates repurchases or otherwise acquires Securities, of the aggregate
principal amount of such Securities so repurchased or otherwise acquired. The
Trustee may require an Officers' Certificate listing Securities owned by the
Issuer, a Subsidiary of the Issuer or any Affiliate of the Issuer.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery, the Issuer may
prepare and the Trustee shall authenticate temporary Securities upon receipt of
a written order of the Issuer in the form of an Officers' Certificate. The
Officers' Certificate shall specify the amount of temporary Securities to be
authenticated and the date on which the temporary Securities are to be
authenticated. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Issuer considers
appropriate for temporary Securities. Without unreasonable delay, the Issuer
shall prepare and execute, and the Trustee shall authenticate upon receipt of a
written order of the Issuer pursuant to Section 2.02, definitive Securities in
exchange for temporary Securities.
SECTION 2.11. Cancellation.
The Issuer at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for transfer, exchange or payment. The
Trustee or, at the direction of the Trustee, the Registrar or the Paying Agent,
and no one else, shall cancel and, at the written direction of the Issuer, shall
dispose of and deliver evidence of such disposal of (but shall not be required
to destroy) all Securities surrendered for transfer, exchange, payment or
cancellation. Subject to Section 2.07, the Issuer may not issue new Securities
to replace Securities that the
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Issuer has paid or delivered to the Trustee for cancellation. If the Issuer
shall acquire any of the Securities, such acquisition shall not operate as a
redemption or satisfaction of the Debt represented by such Securities unless and
until the same are surrendered to the Trustee for cancellation pursuant to this
Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Issuer defaults in a payment of interest on the Securities, it
shall pay the defaulted interest, plus (to the extent lawful) any interest
payable on the defaulted interest to the Persons who are Holders on a subsequent
special record date, which date shall be the fifteenth day next preceding the
date fixed by the Issuer for the payment of defaulted interest or the next
succeeding Business Day if such date is not a Business Day. Prior to such
subsequent special record date the Issuer shall have deposited with the Paying
Agent in immediately available funds money sufficient to make cash payments due
on such day in a timely manner which permits the Paying Agent to remit payment
to the Holders on such day. At least 15 days before the subsequent special
record date, the Issuer shall mail to each Holder, with a copy to the Trustee
and the Agents, a notice that states the subsequent special record date, the
payment date and the amount of defaulted interest, and interest payable on such
defaulted interest, if any, to be paid.
SECTION 2.13. CUSIP Number.
The Issuer in issuing the Securities may use a "CUSIP" number, and if
so, the Trustee shall use the CUSIP number in notices of redemption or exchange
as a convenience to Holders; provided that no representation is hereby deemed to
be made by the Trustee as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Securities, and that reliance may be placed only
on the other identification numbers printed on the Securities.
SECTION 2.14. Deposit of Moneys.
Prior to 12:00 noon (New York City time) on each Interest Payment
Date, Maturity Date, Redemption Date, Change of Control Payment Date and Asset
Sale Payment Date, the Issuer 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, Maturity Date, Redemption Date, Change of Control
Payment Date or Asset Sale Payment Date, as the case may be, in a timely manner
which permits the Paying Agent to remit payment to the Holders on such Interest
Payment Date, Maturity
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Date, Redemption Date, Change of Control Payment Date or Asset Sale Payment
Date, as the case may be.
SECTION 2.15. Book-Entry Provisions for Global Securities.
(a) The Global Securities initially shall (i) be registered in the
name of Cede & Co., as the nominee of The Depository Trust Company, (ii) be
delivered to the Registrar as custodian for such Depositary and (iii) bear
legends as set forth in Exhibit B.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary, or the Registrar as its custodian, or under the
Global Security, and the Depositary may be treated by the Issuer, the Trustee
and any agent of the Issuer or the Trustee as the absolute owner of the Global
Security for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Issuer, the Trustee or any agent of the Issuer or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited to transfers in
whole, but not in part, to the Depositary, its successors or their respective
nominees. Interests of beneficial owners in the Global Securities may be
transferred or exchanged for Certificated Securities in accordance with the
rules and procedures of the Depositary and the provisions of Section 2.16. In
addition, Certificated Securities shall be transferred to all beneficial owners
in exchange for their beneficial interests in Global Securities if (i) the
Issuer notifies the Registrar that the Depositary is unwilling or unable to
continue as Depositary for any Global Security and a successor depositary is not
appointed by the Issuer within 90 days of such notice or (ii) the Issuer, at its
option, notifies the Registrar in writing that it elects to cause the issuance
of Securities in definitive form under this Indenture.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in any Global Security to beneficial owners pursuant to
paragraph (b), the Registrar shall (if one or more Certificated Securities are
to be issued) reflect on its books and records the date and a decrease in the
principal amount of the Global Security in an amount equal to the principal
amount of the beneficial interest in the Global Security to be transferred, and
the Issuer shall execute, and the Trustee shall authenticate and cause to be
delivered, one or more Certificated Securities of like tenor and amount.
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(d) In connection with the transfer of Global Securities as an
entirety to beneficial owners pursuant to the second sentence of paragraph (b),
the Global Securities shall be deemed to be surrendered to the Trustee for
cancellation, and the Issuer shall execute, and the Trustee shall authenticate
and cause to be delivered to each beneficial owner identified by the Depositary
in exchange for its beneficial interest in the Global Securities, an equal
aggregate principal amount of Certificated Securities of authorized
denominations.
(e) Any Certificated Security constituting a Restricted Security
delivered in exchange for an interest in a Global Security pursuant to paragraph
(c) or (d) shall, except as otherwise provided by paragraphs (a)(i)(x) and (z)
of Section 2.16, bear the legend regarding transfer restrictions applicable to
the Certificated Securities set forth on the face of the form of Security in
Exhibit A-1.
(f) The Holder of any Global Security may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Securities.
SECTION 2.16. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and Non-
U.S. Persons and other Transfers Exempt under the Securities Act. The following
provisions shall apply (x) with respect to the registration of any proposed
transfer of a Security constituting a Restricted Security to any Institutional
Accredited Investor which is not a QIB or to any Non-U.S. Person and (y) with
respect to the registration of any proposed transfer pursuant to another
available exemption from the registration requirements of the Securities Act:
(i) the Registrar shall register the transfer of any Securities
constituting a Restricted Security, whether or not such Security bears the
Private Placement Legend, if (x) the requested transfer is after the second
anniversary of the Issue Date; provided, however, that neither the Issuer
nor any Affiliate of the Issuer has held any beneficial interest in such
security, or portion thereof, at any time on or prior to the second
anniversary of the Issue Date 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, the proposed transferor has
delivered to the Registrar a certificate
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substantially in the form of Exhibit D or (3) in the case of a transfer
pursuant to another available exemption from the registration requirements
of the Securities Act, the proposed transferee has delivered to the
Registrar a certificate in form and substance reasonably acceptable to the
Issuer and the Registrar in connection with such transfer, together, in the
case of clause (1), clause (2) or clause (3) with such other
certifications, legal opinions or other information as the Issuer, the
Trustee or the Registrar may reasonably require to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act, or (z)
the Trustee and Registrar have received both an Opinion of Counsel and an
Officers' Certificate directing transfer without a Private Placement
Legend; and
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in a Global Security, upon, receipt by the Registrar of
(x) the certificate, if any, required by paragraph (i) above and (y)
instructions given in accordance with the Depositary'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 Certificated
Securities) a decrease in the principal amount of the Global Security in an
amount equal to the principal amount of the beneficial interest in the Global
Security to be transferred (the "Transfer Amount"),(b) if the Securities to be
transferred are to be evidenced by Certificated Securities, the Issuer shall
execute and the Trustee shall authenticate upon receipt of a written order of
the Issuer in the form of an Officers' Certificate, and cause to be delivered
one or more Certificated Securities in an aggregate principal amount equal to
the Transfer Amount and (c) if the Securities to be transferred are to be
evidenced by an interest in a Global Security, upon receipt of instructions
given in accordance with the Depositary's and the Registrar's procedures, the
Registrar shall reflect on its books and records the date and an increase in the
principal amount of the Global Security in which the transferee will hold its
beneficial interest in an amount equal to the Transfer Amount.
If the Securities to be transferred consist of IAI Securities, the
following shall apply: (x) if such IAI Securities are proposed to be transferred
to an Institutional Accredited Investor which is not a QIB, (i) upon the
registration of such transfer such Securities shall continue to be IAI
Securities, and (ii) the Certificated Securities authenticated and delivered in
connection with such transfer shall be in denominations of $100,000 and any
integral multiple of $1,000 above that amount; and (y) if
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such IAI Securities are proposed to be transferred to a Non-U.S. Person, (i)
upon the registration of such transfer such Securities shall cease to be IAI
Securities, (ii) the Certificated Securities authenticated and delivered in
connection with such transfer shall not contain the restriction on minimum
denominations of $100,000 and (iii) such Certificated Securities shall be in
denominations of $1,000 and any integral multiple thereof.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Security 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 Security stating, or has otherwise advised the Issuer and the
Registrar in writing, that the sale has been made in compliance with the
provisions of Rule 144A to a transferee who has signed the certification
provided for on the form of Security stating, or has otherwise advised the
Issuer and the Registrar in writing, that it is purchasing the Security for
its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such
information regarding the Issuer as it has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that
the Issuer and the transferor is relying upon its foregoing representations
in order to claim the exemption from registration provided by Rule 144A, if
the Trustee or the Issuer shall so request, such proposed transferor shall
have delivered an opinion of counsel, an officers' certificate and such
other information as the Trustee or the Issuer may reasonably require in
connection with such proposed transfer; and
(ii) if the proposed transferee is an Agent Member, and the Securities
to be transferred consist of Certificated Securities which after transfer
are to be evidenced by an interest in the Global Security, upon receipt by
the Registrar of instructions given in accordance with the Depositary's and
the Registrar's procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount of the Global
Security in an amount equal to the principal amount of the Certificated
Securities to be transferred, and the Trustee shall cancel the Certificated
Securities so transferred; and
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(iii) if the proposed transferee is an Agent Member, and the
Securities to be transferred consist of a beneficial interest in a Global
Security which after transfer is to continue to be evidenced by an interest
in a Global Security, upon receipt by the Registrar of instructions given
in accordance with the Depositary's and the Registrar's procedures, the
Registrar shall reflect on its books and records (A) the date, (B) a
decrease in the principal amount of the Global Security in which the
transferor owns the beneficial interest to be transferred in an amount
equal to the principal amount of the beneficial interest to be transferred
and (C) an increase in the principal amount of the Global Security in which
the transferee will hold its beneficial interest in a like amount; and
(iv) if the Securities to be transferred consist of IAI Securities,
upon the registration of such transfer according to this Section 2.16 such
Securities shall cease to be IAI Securities and may be evidenced by
Certificated Securities or interests in a Global Security in denominations
of $1,000 and any integral multiple thereof.
(c) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar shall deliver Securities that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Securities bearing the
Private Placement Legend, the Registrar shall deliver only Securities that bear
the Private Placement Legend unless (i) the circumstances contemplated by
paragraph (a)(i) of this Section 2.16 exist, (ii) there is delivered to the
Issuer, the Registrar and the Trustee an Opinion of Counsel reasonably
satisfactory to the Issuer and the Trustee to the effect that neither such
legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act or (iii) such
Securities have been sold pursuant to an effective registration statement under
the Securities Act.
(d) General. By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture and such Security.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or this Section 2.16.
The Issuer shall have the right to inspect and make copies of all such letters;
notices or other written
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communications at any reasonable time upon the giving of reasonable written
notice to the Registrar.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Optional Redemption.
Optional Redemption. (i) The Securities will be redeemable at the
option of the Issuer, in whole or in part, at any time on or after September 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 (the
"Redemption Price"), plus accrued and unpaid interest to the Redemption Date, if
redeemed during the 12-month period beginning on September 15, of the years
indicated below:
Redemption
Year Price
---- ----------
2001........................................ 105.000%
2002........................................ 102.500%
2003 and thereafter......................... 100.000%
(ii) At any time prior to September 15, 2000, the Issuer may on any
one or more occasions redeem from the net proceeds of one or more Equity
Offerings up to an aggregate of 33.3% in aggregate principal amount of the
Securities at a redemption price of 110.000% of the principal amount thereof,
plus accrued and unpaid interest thereon to the redemption date; provided that
at least $63.4 million aggregate principal amount of Securities remain
outstanding immediately after the occurrence of such redemption.
SECTION 3.02. Applicability of Article.
Redemption of Securities at the election of the Issuer or otherwise,
as permitted or required by any provision of this Indenture, shall be made in
accordance with such provision and this Article.
SECTION 3.03. Election To Redeem; Notice to Trustee.
The election of the Issuer to redeem any Securities pursuant to
Section 3.01(a) shall be evidenced by an Officers' Certificate. In case of any
redemption at the election of the Issuer pursuant to Section 3.01(a), the Issuer
shall, at least 45 days prior to the Redemption Date fixed by the Issuer (unless
a shorter notice period shall be satisfactory to the Trustee), notify
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the Trustee in writing of such Redemption Date and of the principal amount of
Securities to be redeemed.
SECTION 3.04. Selection by Trustee of Securities To Be Redeemed.
In the event that less than all of the Securities are to be redeemed
at any time, selection of such Securities for redemption will be made by the
Trustee in compliance with the requirements of the principal national securities
exchange, if any, on which the Securities are listed or, if the Securities are
not then listed on a national securities exchange, on a pro rata basis, by lot
or by such method as the Trustee shall deem fair and appropriate; provided that
no Securities of a principal amount of $1,000 shall be redeemed in part. If any
Security is to be redeemed in part only, a new Security in a principal amount
equal to the unredeemed portion thereof will be issued in the name of the holder
thereof upon cancellation of the original Security. On and after the Redemption
Date, if the Issuer does not default in the payment of the Redemption Price,
interest will cease to accrue on Securities or portions thereof called for
redemption.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Securities shall relate, in
the case of any Security redeemed or to be redeemed only in part, to the portion
of the principal amount of such Security which has been or is to be redeemed.
SECTION 3.05. Notice of Redemption.
Notice of redemption shall be mailed by first-class mail, postage
prepaid, mailed at least 30 but no more than 60 days before the Redemption Date.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all outstanding Securities are to be redeemed, the
identification of the particular Securities to be redeemed;
(d) in the case of a Security to be redeemed in part, the principal
amount of such Security to be redeemed and that after the Redemption Date
upon surrender of such Security, a new Security or Securities in the
aggregate principal amount equal to the unredeemed portion thereof will be
issued;
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(e) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(f) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security or portion thereof, and that (unless
the Issuer shall default in payment of the Redemption Price) interest
thereon shall cease to accrue on and after said date;
(g) the place or places where such Securities are to be surrendered
for payment of the Redemption Price;
(h) the CUSIP number, if any, relating to such Securities; and
(i) the paragraph of the Securities pursuant to which the Securities
are being redeemed.
Notice of redemption of Securities to be redeemed shall be given by
the Issuer or, as otherwise requested by the Issuer in writing, by the Trustee
in the name and at the expense of the Issuer.
The notice if mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Security designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
SECTION 3.06. Deposit of Redemption Price.
On or prior to 12:00 noon (New York City time) on any Redemption Date
the Issuer shall deposit or cause to be deposited with the Trustee or with a
Paying Agent (or, if the Issuer is acting as its own Paying Agent, segregate and
hold in trust as provided in Section 2.04) an amount of money in same day funds
sufficient to pay the Redemption Price of, and accrued interest on, all the
Securities or portions thereof which are to be redeemed on that date.
SECTION 3.07. Securities Payable on Redemption Date.
Notice of Redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Issuer shall default in the payment of the Redemption Price) such Securities
shall cease to bear
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interest. Upon surrender of any such Security for redemption in accordance with
said notice, such Security shall be paid by the Issuer at the Redemption Price;
provided, that installments of interest whose Stated Maturity is on or prior to
the Redemption Date shall be payable to the Holders of such Securities, or one
or more predecessor Securities, registered as such on the relevant record dates
according to the terms and the provisions of the Securities.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear interest from the Redemption Date at the rate then borne by
such Security.
SECTION 3.08. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
to the Paying Agent at the office or agency maintained for such purpose pursuant
to Section 2.03 (with, if the Issuer, the Registrar or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to,
the Issuer, the Registrar or the Trustee duly executed by the Holder thereof or
such Holder's attorney duly authorized in writing), and the Issuer shall
execute, and the Trustee shall authenticate and cause to be delivered to the
Holder of such Security without service charge, a new Security or Securities, of
any authorized denomination as requested by such Holder in aggregate principal
amount equal to, and in exchange for, the portion of the principal of the
Security so surrendered that is not redeemed.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Issuer shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities. An installment of
principal of or interest on the Securities shall be considered paid on the date
it is due if the Trustee or Paying Agent holds at 12:00 noon (New York City
time) on that date U.S. Legal Tender designated for and sufficient to pay the
installment. Interest will be computed on the basis of a 360-day year comprised
of twelve 30-day months.
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SECTION 4.02. Maintenance of Office or Agency.
The Issuer shall maintain the office or agency required under Section
2.03. The Issuer shall give prior notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Issuer
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the address of the Trustee set
forth in Section 13.02.
SECTION 4.03. Corporate Existence.
Except as otherwise permitted by Article Four, Article Five or Section
11.05, the Issuer and each Restricted Subsidiary shall do or cause to be done
all things reasonably necessary to preserve and keep in full force and effect
their respective corporate or other existence and the corporate or other
existence of each of their respective Restricted Subsidiaries in accordance with
the respective organizational documents of each such Restricted Subsidiary and
the material rights (charter and statutory) and franchises of the Issuer and
each of its Restricted Subsidiaries; except for any such existence, material
right or franchise which are not in the aggregate reasonably likely to have a
material adverse effect on the financial condition or results of operations of
the Issuer and its Restricted Subsidiaries, taken as a whole.
SECTION 4.04. Payment of Taxes and Other Claims.
The Issuer shall pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all material taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon it or any of its Restricted
Subsidiaries or properties of it or any of its Restricted Subsidiaries and (ii)
all material lawful claims for labor, materials, supplies and services that, if
unpaid, might by law become a Lien upon the property of it or any of its
Restricted Subsidiaries; provided, however, that there shall not be required to
be paid or discharged any such tax, assessment, claim or charge, the amount,
applicability or validity of which is being contested in good faith by
appropriate proceedings and for which adequate provision has been made or where
the failure to effect such payment or discharge would not result in a material
adverse change to the financial condition or results of operations of the Issuer
and its Restricted Subsidiaries, taken as a whole.
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SECTION 4.05. Maintenance of Properties and Insurance.
(a) The Issuer shall, and shall cause each of its Restricted
Subsidiaries to, maintain its material properties in normal condition (subject
to ordinary wear and tear) and make all reasonably necessary repairs, renewals
or replacements thereto as in the judgment of the Issuer may be reasonably
necessary to the conduct of the business of the Issuer and its Restricted
Subsidiaries; provided, however, that nothing in this Section 4.05 shall prevent
the Issuer or any of its Restricted Subsidiaries from discontinuing the
operation and maintenance of any of its properties, if such properties are no
longer reasonably necessary in the conduct of their respective businesses.
(b) The Issuer shall provide or cause to be provided, for itself and
each of its Restricted Subsidiaries, insurance (including appropriate self-
insurance) against loss or damage of the kinds that, in the reasonable, good
faith opinion of the Issuer are reasonably adequate and appropriate for the
conduct of the business of the Issuer and its Restricted Subsidiaries.
SECTION 4.06. Compliance Certificate; Notice of Default.
(a) The Issuer shall deliver to the Trustee, within 120 days after the
end of the Issuer's fiscal year, an Officers' Certificate (signed by the
principal executive officer, principal financial officer or principal accounting
officer) stating that a review of its activities and the activities of its
Restricted Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether a Default
or Event of Default has occurred and further stating, as to each such Officer
signing such certificate, that to the best of his knowledge, no Default or Event
of Default occurred during such year and at the date of such certificate there
is no Default or Event of Default that has occurred and is continuing or, if
such signers do know of such Default or Event of Default, the certificate shall
describe the Default or Event of Default and its status with particularity. The
Officers' Certificate shall also notify the Trustee should the Issuer elect to
change the manner in which it fixes its fiscal year end.
(b) (i) If any Default or Event of Default has occurred and is
continuing or (ii) if any Holder seeks to exercise any remedy hereunder with
respect to a claimed Default under this Indenture or the Securities, the Issuer
shall deliver to the Trustee by registered or certified mail or by facsimile
transmission followed by hard copy by registered or certified mail an Officers'
Certificate specifying such event, notice or other action within five Business
Days of the actual knowledge by an Authorized Officer of such occurrence.
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SECTION 4.07. Compliance with Laws.
The Issuer and each of its Restricted Subsidiaries shall comply, and
shall cause each of their respective Restricted Subsidiaries to comply, with all
applicable statutes, rules, regulations, orders and restrictions of the United
States of America and each other country in which the Issuer or any of its
Restricted Subsidiaries conducts business, all states and municipalities
thereof, and of any governmental department, SEC, board, regulatory authority,
bureau, agency and instrumentality of the foregoing, in respect of the conduct
of their respective businesses and the ownership of their respective properties,
except for such noncompliances as are not in the aggregate reasonably likely to
have a material adverse effect on the financial condition or results of
operations of the Issuer and its Restricted Subsidiaries, taken as a whole.
SECTION 4.08. Reports.
Whether or not the Issuer is then subject to Section 13(a) or 15(d) of
the Exchange Act, the Issuer will file with the SEC, so long as any Securities
are outstanding, the annual reports (including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and, with respect to
the annual financial statements, a report thereon by the Issuer's independent
accountants), quarterly reports (including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations") and other periodic
reports which the Issuer would have been required to file with the SEC pursuant
to such Section 13(a) or 15(d) if the Issuer were so subject, and such documents
shall be filed with the SEC on or prior to the respective dates (the "Required
Filing Dates") by which the Issuer would have been required so to file such
documents if the Issuer were so subject. The Issuer will also in any event, so
long as any Securities are outstanding and whether or not the filing of such
documents by the Issuer with the SEC is prohibited under the Exchange Act,
within 15 days of each Required Filing Date, (a) transmit by mail to all Holders
of Securities, as their names and addresses appear in the Registrar's books,
without cost to such Holders and (b) file with the Trustee, copies of the annual
reports, quarterly reports and other periodic reports which the Issuer would
have been required to file with the SEC pursuant to Section 13(a) or 15(d) of
the Exchange Act if the Issuer were subject to such Section 13(a) or 15(d). The
Issuer will also comply with any other periodic reporting provisions pursuant to
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 Issuer's
compliance with any of
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its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officers' Certificates).
SECTION 4.09. Waiver of Stay, Extension or Usury Laws.
The Issuer will not (to the extent that it may lawfully do so) at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law that
would prohibit or forgive the Issuer from paying all or any portion of the
principal of or interest on the Securities as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
obligations or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Issuer hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
SECTION 4.10. Limitation on Restricted Payments.
(a) The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any Restricted Payment, unless, at
the time of and immediately after giving effect to the proposed Restricted
Payment (with the value of any such Restricted Payment, if other than cash, to
be determined by the Board of Directors of the Issuer, whose determination shall
be conclusive and evidenced by a Board Resolution), (i) no Default or Event of
Default shall have occurred and be continuing or would occur as a consequence
thereof; (ii) the Issuer would, at the time of such Restricted Payment and after
giving pro forma effect thereto as if such Restricted Payment had been made at
the beginning of the applicable four-quarter period, have been permitted to
incur at least $1.00 of additional Debt pursuant to the Consolidated Fixed
Charge Coverage Ratio test set forth in Section 4.12(a); and (iii) such
Restricted Payment, together with the aggregate amount of all other Restricted
Payments made by the Issuer and its Restricted Subsidiaries after the date of
this Indenture (including Restricted Payments permitted by clauses (i) and (iv)
of Section 4.10(b) and excluding the Restricted Payments permitted by the other
clauses therein), is less than or equal to the sum of (a) 50% of the
Consolidated Net Income (or if Consolidated Net Income shall be a loss, minus
100% of such loss) earned on an accumulative basis during the period beginning
October 1, 1997 and ending on the last date of the Issuer's fiscal quarter
immediately preceding such proposed restricted payment, plus (b) 100% of the
aggregate net cash proceeds received by the Issuer as capital contributions
after October 1, 1997 or from the issue or
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sale after October 1, 1997 of Equity Interests of the Issuer or of Disqualified
Stock or debt securities of the Issuer that have been converted into such Equity
Interests (other than Equity Interests (or Disqualified Stock or convertible
debt securities) sold to a Restricted Subsidiary of the Issuer and other than
Disqualified Stock or convertible debt securities that have been converted into
Disqualified Stock), plus (c) $2.0 million.
(b) The provisions of Section 4.10(a) will not prohibit (i) the
payment of any dividend or consummation of any irrevocable redemption within 60
days after the date of declaration thereof or the giving of an irrevocable
redemption notice, if at said date of declaration or giving of notice such
payment or redemption would have complied with the provisions of this Indenture;
(ii) the redemption, repurchase, retirement or other acquisition of any Equity
Interests of the Issuer or any Restricted Subsidiary of the Issuer or any
Subordinated Debt of the Issuer or any Restricted Subsidiary, in each case in
exchange for, or out of the net proceeds of, the substantially concurrent sale
(other than to a Restricted Subsidiary of the Issuer) of other Equity Interests
of the Issuer (other than any Disqualified Stock); provided, however, that the
amount of any such net proceeds that are utilized for any such redemption,
repurchase, retirement or other acquisition shall be excluded from clause (ii)
of Section 4.10(a); (iii) the redemption, repurchase, refinancing or defeasance
of Subordinated Debt in exchange for, or with the net cash proceeds from, an
Incurrence of Permitted Refinancing Debt; (iv) the payment to the Parent of any
amounts required under the Tax Sharing Agreement; (v) up to $350,000 in any
period of four consecutive quarters to fund repurchases by the Parent (or its
successor) of Equity Interests therein or Debt therein issued in connection with
such Equity Interests held by Persons who have ceased to be bona fide officers
or employees of the Issuer or one of its Restricted Subsidiaries, provided that
any unused amount thereof may be carried forward to subsequent periods so long
as the total amount of such Restricted Payments shall not exceed $2.5 million;
and (vi) the payment of amounts to fund the Parent's bona fide corporate
overhead and similar fees and expenses relating to the ownership or operation of
the Issuer.
SECTION 4.11. Limitation on Transactions with Related Persons.
The Issuer will not, nor will it permit any of its Restricted
Subsidiaries to (a) sell, lease, transfer or otherwise dispose of any of its
property to, (b) purchase any property from, (c) make any Investment in, or (d)
enter into or amend any contract, agreement or understanding with or for the
benefit of, a Related Person of the Issuer or any Restricted Subsidiary (other
than the Issuer or any such Restricted Subsidiary) in which no Related Person
(other than the Issuer or a Wholly Owned Restricted
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Subsidiary of the Issuer) owns, directly or indirectly, an equity interest (each
a "Related Person Transaction"), other than Related Person Transactions that are
on terms that are no less favorable to the Issuer or such Restricted Subsidiary
than those that could be obtained in a comparable arm's length transaction by
the Issuer or such Restricted Subsidiary from an unrelated party; provided that
the Issuer delivers to the Trustee (i) with respect to any Related Person
Transaction involving aggregate payments in excess of $1.0 million, a resolution
of the Board of Directors of the Issuer set forth in an Officers' Certificate
certifying that such Related Person Transaction complies with the preceding
sentence and such Related Person Transaction is approved by a majority of the
disinterested members of the Board of Directors of the Issuer and (ii) with
respect to any Related Person Transaction involving aggregate payments in excess
of $5.0 million, an affirmative opinion as to the fairness to the Issuer or such
Restricted Subsidiary, as the case may be, from a financial point of view issued
by a nationally recognized accounting, appraisal, investment banking or
consulting firm that is, in the judgment of the Board of Directors of the
Issuer, qualified to render such opinion. The foregoing restrictions shall not
apply to (a) any transactions between Wholly Owned Restricted Subsidiaries of
the Issuer, or between the Issuer and any Wholly Owned Restricted Subsidiary of
the Issuer, if such transaction is not otherwise prohibited by the terms of this
Indenture, (b) any transactions between or among the Issuer and any Restricted
Subsidiaries involving the provision of goods or services in the ordinary course
of business, (c) any payments or purchases permitted by Section 4.10, (d)
customary directors' fees, indemnification and similar arrangements, employee
salaries, bonuses or employment agreements, compensation or employee benefit
arrangements and incentive arrangements with any officer, director or employee
of the Issuer or any Restricted Subsidiary entered into in the ordinary course
of business (including customary benefits thereunder) and payments under any
indemnification arrangements permitted by applicable law, (e) transactions
undertaken pursuant to the Management Agreement, the Tax Sharing Agreement and
the Registration Agreement, (f) the issue and sale by the Issuer to its
stockholders of Equity Interests other than Disqualified Stock, (g) the
incurrence of intercompany Debt permitted pursuant to Section 4.12, (h) the
pledge of Equity Interests of Unrestricted Subsidiaries to support the Debt
thereof, (i) customary indemnification and similar arrangements with any
officer, director or employee of the Parent relating to the business, operations
or ownership of the Issuer, and (j) the payment of amounts pursuant to the
Management Agreement.
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SECTION 4.12. Limitation on Incurrence of Debt and Issuance of Disqualified
Stock.
(a) The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively, "incur") any Debt (including Acquired Debt) and
the Issuer will not permit any of its Restricted Subsidiaries to issue any
shares of Disqualified Stock; provided, however, that if no Default shall have
occurred and be continuing at the time or as a consequence of said Debt
incurred, the Issuer and any Restricted Subsidiary may incur Debt (including
Acquired Debt) if the Consolidated Fixed Charge Coverage Ratio for the Issuer's
and its Restricted Subsidiaries most recently ended four full fiscal quarters
for which financial statements are available immediately preceding the date on
which such additional Debt is incurred would have been at least 2.0 to 1.0,
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Debt had been incurred at the
beginning of such four-quarter period.
(b) The provisions of Section 4.12(a) will not apply to the incurrence
of any of the following items of Debt (collectively, "Permitted Debt"):
(i) the incurrence by the Issuer or any of its Restricted Subsidiaries of
Debt under Credit Facilities; provided that the aggregate principal amount of
all Debt outstanding under Credit Facilities and incurred pursuant to this
clause (i), after giving effect to such incurrence, does not exceed (y) the
greater of (a) $25.0 million and (b) the Borrowing Base less (z) the principal
amount of Debt outstanding pursuant to clause (x) below;
(ii) the incurrence by the Issuer and its Restricted Subsidiaries of
Existing Debt;
(iii) the incurrence by the Issuer or any of its Restricted Domestic
Restricted Subsidiaries of Debt represented by the Original Securities or any
Guarantee thereof;
(iv) the incurrence by the Issuer or any of its Restricted Subsidiaries of
Permitted Refinancing Debt in exchange for, or the net proceeds of which are
used to refund, refinance or replace, Debt that was permitted by this Indenture
to be incurred;
(v) the incurrence by the Issuer or any of its Restricted Subsidiaries of
intercompany Debt between or among the Issuer and (a) any of its Wholly Owned
Restricted Subsidiaries or (b) any of its other Restricted Subsidiaries if and
to the extent such Debt,
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when incurred, constitutes an Investment permitted by Section 4.10; provided,
however, that (i) if the Issuer or any Guarantor is the obligor on such Debt,
such Debt is expressly subordinated to the prior payment in full in cash of all
Obligations with respect to the Securities or the Guarantees, as applicable, and
(ii) (A) any subsequent issuance or transfer of Equity Interests that results in
any Debt described in the foregoing clause (a) being held by a Person other than
the Issuer or a Wholly Owned Restricted Subsidiary and (B) any sale or other
transfer of any such Debt to a Person that is not either the Issuer or a
Restricted Subsidiary shall be deemed, in each case, to constitute an incurrence
of such Debt by the Issuer or such Restricted Subsidiary, as the case may be;
(vi) the incurrence by the Issuer or any of its Restricted Subsidiaries of
Hedging Obligations that are incurred for the purpose of fixing or hedging
interest rate risk with respect to any floating rate Debt that is permitted by
the terms of this Indenture to be outstanding or for the purpose of fixing or
hedging currency exchange risk with respect to any currency exchanges;
(vii) Capitalized Lease Obligations and Purchase Money Obligations of the
Issuer and its Subsidiaries not to exceed $2.0 million in aggregate principal
amount (or accrued value, as applicable) at any time outstanding;
(viii) Guarantees by the Issuer of Debt of any Restricted Subsidiaries
otherwise permitted by this covenant and Guarantees by any of the Issuer's
Restricted Subsidiaries of Debt of the Issuer or any Restricted Subsidiary
permitted to be incurred under Section 4.18;
(ix) Indebtedness of the Issuer or any Restricted Subsidiary in respect of
performance bonds, bankers' acceptances, trade letters of credit, surety bonds
and guarantees provided by the Issuer or any Restricted Subsidiary in the
ordinary course of business;
(x) Debt of Foreign Restricted Subsidiaries incurred for working capital
purposes in an aggregate principal amount outstanding at any one time not to
exceed the sum of 85% of the net book value of such Foreign Restricted
Subsidiaries' accounts receivable determined in accordance with GAAP and 60% of
the net book value of their inventory determined in accordance with GAAP and
guarantees by Foreign Restricted Subsidiaries of such Debt (which Debt shall
reduce the aggregate Debt permitted pursuant to clause (i) above in the manner
contemplated thereby); and
(xi) the incurrence by the Issuer or any of its Restricted Subsidiaries of
additional Debt in an aggregate principal amount
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(or accrued value, as applicable) at any time outstanding, including all
Permitted Refinancing Debt incurred to refund, refinance or replace any other
Debt incurred pursuant to this clause (xi), not to exceed $10 million (which
amount may, but need not, be incurred in whole or in part under the Senior
Credit Facility).
(c) For purposes of determining compliance with this Section 4.12 in
the event that an item of Debt meets the criteria of more than one of the
categories of Permitted Debt described in clauses (i) through (xi) of Section
4.12(b) or is entitled to be incurred pursuant to Section 4.12(a), the Issuer
shall, in its sole discretion, classify such item of Debt in any manner that
complies with this Section 4.12 and such item of Debt will be treated as having
been incurred pursuant to only one of such clauses of Section 4.12(b) or
pursuant to Section 4.12(a). Accrual of interest, the accretion of accrued
value and the payment of interest in the form of additional Debt will not be
deemed to be an incurrence of Debt for purposes of this Section 4.12.
SECTION 4.13. Payment Restrictions Affecting Restricted Subsidiaries.
The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
Restricted Subsidiary to (i) (a) pay dividends or make any other distributions
to the Issuer or any of its Restricted Subsidiaries (1) on its Capital Stock or
(2) with respect to any other interest or participation in, or measured by, its
profits, or (b) pay any indebtedness owed to the Issuer or any of its Restricted
Subsidiaries, (ii) make loans or advances to the Issuer or any of its Restricted
Subsidiaries or (iii) transfer any of its properties or assets to the Issuer or
any of its Restricted Subsidiaries, except for such encumbrances or restrictions
existing under or by reason of (a) the Senior Credit Facility as in effect as of
the date of this Indenture, and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings
thereof, provided that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacement or refinancings are not more
restrictive taken as a whole with respect to such dividend and other payment
restrictions than those contained in the Senior Credit Facility as in effect on
the date of this Indenture (as determined by the Board of Directors of the
Issuer in its reasonable and good faith judgment), (b) this Indenture and the
Securities, (c) applicable law, (d) any instrument governing Debt or Capital
Stock of a Person acquired by the Issuer or any of its
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Restricted Subsidiaries as in effect at the time of such acquisition (except to
the extent such Debt was incurred in connection with or in contemplation of such
acquisition), which encumbrance or restriction is not applicable to any Person,
or the properties or assets of any Person, other than the Person, or the
property or assets of the Person, so acquired, provided that, in the case of
Debt, such Debt was permitted by the terms of this Indenture to be incurred, (e)
customary non-assignment provisions in leases and other agreements entered into
in the ordinary course of business and consistent with past practices,
restricting assignment or restricting transfers of non-cash assets, (f) Purchase
Money Obligations for property acquired in the ordinary course of business and
other Liens permitted by this Indenture, in each case that impose restrictions
of the nature described in clause (iii) above on the property so acquired (or
subject to such Liens), (g) Debt permitted by clause (x) of Permitted Debt, (h)
Permitted Refinancing Debt, provided that the restrictions contained in the
agreements governing such Permitted Refinancing Debt are not more restrictive
taken as a whole than those contained in the agreements governing the Debt being
refinanced (as determined by the Board of Directors of the Issuer in its
reasonable and good faith judgment), (i) contracts for the sale of assets, (j)
customary provisions in agreements with respect to Permitted Joint Ventures, or
(k) any pledge by the Issuer or a Restricted Subsidiary of the Equity Interests
of an Unrestricted Subsidiary to support the Debt thereof.
SECTION 4.14. Prohibition on Incurrence of Senior Subordinated Debt.
The Issuer will not, directly or indirectly, incur, create, issue,
assume, guarantee or otherwise become liable for any Debt that is expressly
subordinated or junior in right of payment to any Senior Debt of the Issuer and
senior in any respect in right of payment to the Securities, and (b) the Issuer
will not, directly or indirectly, permit any Guarantor to incur, create, issue,
assume, guarantee or otherwise become liable for any Debt that is expressly
subordinated or junior in right of payment to its Guarantor Senior Debt and
senior in any respect in right of payment to its Guarantee.
SECTION 4.15. Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder of
Securities can require the Issuer to repurchase all or a portion of such
Holder's Securities pursuant to the offer described in Section 4.15(b) (the
"Change of Control Offer"), at an offer price in cash equal to 101% of the
aggregate principal amount thereof and accrued and unpaid interest thereon, if
any, to the
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date of repurchase (the "Change of Control Payment"). Prior to the mailing of
the notice referred to in Section 4.15(b), but in any event within 90 days
following the date on which a Change of Control occurs, the Issuer covenants to
(i) repay in full (and shall repay in full) in cash all outstanding Senior Debt
under the Senior Credit Facility (and terminate all commitments thereunder) and
all other Senior Debt the terms of which require repayment upon a Change of
Control, or (ii) obtain the requisite consents under the Senior Credit Facility
and all such other Senior Debt to permit the repurchase of the Securities as
provided in this Section 4.15. The Issuer shall first comply with the covenant
in the immediately preceding sentence before it shall be required to repurchase
the Securities pursuant to the provisions described in this Section 4.15;
provided that an Issuer's failure to comply with such covenant resulting in a
failure to mail the notice referred to in Section 4.15(b) shall constitute an
Event of Default under Section 6.01(3) and not under Section 6.01(2).
(b) Within 30 days following the date upon which a Change of Control
occurs (the "Change of Control Date"), the Issuer shall send, by first class
mail, a notice to each Holder of the Securities, with a copy to the Trustee,
which notice shall govern the terms of the Change of Control Offer. The notice
to the Holders shall contain all instructions and materials necessary to enable
such Holders to tender the Securities pursuant to the Change of Control Offer.
Such notice shall state:
(1) that a Change of Control has occurred and that such Holder has the
right to require the Issuer to repurchase all or a portion (equal to $1,000
principal amount or an integral multiple thereof) of such Holder's
Securities at a purchase price in cash equal to 101% of the aggregate
principal amount thereof, plus accrued and unpaid interest to the date of
purchase (the "Change of Control Payment Date"), which shall be a Business
Day, specified in such notice, that is not earlier than 30 days or later
than 60 days from the date such notice is mailed;
(2) the amount of accrued and unpaid interest as of the Change of
Control Payment Date;
(3) that any Security not tendered will continue to accrue interest;
(4) that, unless the Issuer defaults in the payment of the purchase
price for the Securities payable pursuant to the Change of Control Offer,
any Securities accepted for payment pursuant to the Change of Control Offer
shall cease to accrue interest after the Change of Control Payment Date;
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(5) that Holders electing to have a Securities purchased pursuant to a
Change of Control Offer will be required to surrender the Securities, with
the form entitled "Option of Holder to Elect Purchase" on the reverse of
the Security completed, to the Paying Agent at the address specified in the
notice prior to the close of business on the third Business Day prior to
the Change of Control Payment Date;
(6) that Holders will be entitled to withdraw their election if the
Paying Agent receives, not later than five Business Days prior to the
Change of Control Payment Date, a facsimile transmission or letter setting
forth the name of the Holder, the principal amount and certificate number
of the Security(s) the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Security(s) purchased;
(7) that Holders whose Securities are purchased only in part will be
issued new Securities in a principal amount equal to the unpurchased
portion of the Securities surrendered, provided that each new Security will
be in a principal amount of $1,000 or an integral multiple thereof; and
(8) such other information as may be required by applicable laws and
regulations.
(c) On the Change of Control Payment Date, the Issuer will, to the
extent lawful, (i) accept for payment all Securities or portions thereof
properly tendered pursuant to the Change of Control Offer, (ii) deposit with the
Trustee an amount equal to the Change of Control Payment in respect of all
Securities or portions thereof so tendered , and (iii) deliver or cause to be
delivered to the Trustee the Securities so accepted pursuant to such Change of
Control Offer together with an Officers' Certificate stating the aggregate
principal amount of Securities or portions thereof being purchased by the
Issuer. The Paying Agent shall promptly mail to each Holder of Securities or
portions thereof accepted for payment an amount equal to the Change of Control
Payment for such Securities or portion thereof, and the Trustee shall promptly
authenticate and mail (or cause to be transferred by book entry) to such Holder
of Securities accepted for payment in part a new Security or Securities equal in
principal amount to any unpurchased portion of such Holder's Securities,
provided that each such new Security will be in a principal amount of $1,000 or
an integral multiple thereof, and any Security not accepted for payment in whole
or in part shall be promptly returned to the Holder of such Security. On and
after a Change of Control Payment Date, interest will cease to accrue on the
Securities or portions thereof accepted for payment, unless the Issuer defaults
in the payment of the purchase price therefor. The Issuer will announce the
results of
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the Change of Control Offer to Holders of the Securities on or as soon as
practicable after the Change of Control Payment Date.
(d) The Issuer will comply with the requirements of Rule 14e-l under
the Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of the Securities pursuant to a Change of Control Offer. To the
extent the provisions of any such rule conflict with the provisions of this
Indenture relating to a Change of Control Offer, the Issuer shall comply with
the provisions of such rule and be deemed not to have breached its obligations
relating to such Change of Control Offer by virtue thereof.
SECTION 4.16. Limitation on Asset Sales.
(a) The Issuer will not, and will not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Issuer (or the
Restricted Subsidiary, as the case may be) receives consideration at the time of
such Asset Sale at least equal to the fair market value (evidenced by a
resolution of the Board of Directors of the Issuer set forth in an Officers'
Certificate delivered to the Trustee) of the assets or Equity Interests issued
or sold or otherwise disposed of and (ii) at least 75% of the consideration
therefor received by the Issuer or such Restricted Subsidiary is in the form of
cash, properties and assets to be used in the Issuer's business or Equity
Interest in a Person which becomes a Restricted Subsidiary; provided that the
amount of (x) any liabilities (as shown on the Issuer's or such Restricted
Subsidiary's most recent balance sheet) of the Issuer or any Restricted
Subsidiary (other than contingent liabilities, liabilities that are by their
terms subordinated to the Securities or any guarantee thereof and liabilities
constituting Senior Debt) that are assumed by the transferee of any such assets
pursuant to a customary novation agreement or other agreement that releases or
indemnifies the Issuer or such Restricted Subsidiary from further liability and
(y) any securities, notes or other obligations received by the Issuer or any
such Restricted Subsidiary from such transferee that are immediately converted
by the Issuer or such Restricted Subsidiary into cash (to the extent of the cash
received), shall be deemed to be cash for purposes of this provision.
(b) Within 360 days after the receipt of any Net Proceeds from an
Asset Sale, the Issuer or such Restricted Subsidiary may apply such Net Proceeds
at its option, (i) to permanently repay, reduce or secure letters of credit in
respect of Senior Debt and/or Guarantor Senior Debt (and to correspondingly
reduce commitments with respect thereto in the case of revolving borrowings),
and/or (ii) to the acquisition of a controlling
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interest in another business, the making of a capital expenditure or Permitted
Investment or the acquisition of other assets, in each case, for use in the same
or a similar line of business as the Issuer or such Restricted Subsidiary was
engaged in on the date of such Asset Sale or reasonable extensions thereof.
Pending the final application of any such Net Proceeds, the Issuer or such
Restricted Subsidiary may temporarily reduce indebtedness under the Senior
Credit Facility (or any alternative or subsequent revolving credit agreement
where borrowings thereunder constitute Senior Debt and/or Guarantor Senior Debt)
or otherwise invest such Net Proceeds in any manner that is not prohibited by
this Indenture. Any Net Proceeds from Asset Sales that are not applied or
invested as provided in the first sentence of this Section 4.16(b) will be
deemed to constitute "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds exceeds $5.0 million,
the Issuer will be required to make an offer (an "Asset Sale Offer") to all
Holders of Securities and holders of any other Pari Passu Debt outstanding with
provisions requiring the Issuer to make an offer to purchase or redeem such
indebtedness with the proceeds from any Asset Sale as follows: (i) the Issuer
will make an offer to purchase from all holders of the Securities in accordance
with the procedures set forth in this Indenture in the maximum principal amount
(expressed as a multiple of $1,000) of Securities that may be purchased out of
an amount (the "Security Amount") equal to such Excess Proceeds multiplied by a
fraction, the numerator of which is the outstanding principal amount of the
Securities, and the denominator of which is the sum of the outstanding principal
amount of the Securities and such Pari Passu Debt (subject to proration in the
event such amount is less than the aggregate Asset Sale Offered Price of all
Securities tendered), and (ii) to the extent required by such Pari Passu Debt to
permanently reduce the principal amount of such Pari Passu Debt, the Issuer will
make an offer to purchase or otherwise repurchase or redeem Pari Passu Debt (an
"Asset Sale Pari Passu Offer) in an amount (the "Pari Passu Debt Amount" ) equal
to the excess of the Excess Proceeds over the Security Amount; provided that in
no event will the Issuer be required to make an Asset Sale Pari Passu Offer in a
Pari Passu Debt Amount exceeding the principal amount of such Pari Passu Debt
plus the amount of any premium required to be paid to repurchase such Pari Passu
Debt. The offer price for the Securities (the "Asset Sale Offered Price") will
be payable in cash in an amount equal to 100% of the principal amount of the
Securities, plus accrued and unpaid interest, if any, to the date such Asset
Sale Offer is consummated (the "Asset Sale Payment Date"), in accordance with
the procedures set forth in this Indenture. To the extent that the aggregate
Asset Sale Offered Price of the Securities tendered pursuant to the Asset Sale
Offer is less than the Security Amount relating thereto or the aggregate amount
of Pari Passu Debt that is purchased in an Asset Sale Pari
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Passu Offer is less than the Pari Passu Debt Amount, the Issuer may use any
remaining Excess Proceeds for general corporate purposes. If the aggregate
principal amount of Securities and Pari Passu Debt surrendered by holders
thereof exceeds the amount of Excess Proceeds, the Trustee shall select the
Securities to be purchased on a pro rata basis. Upon the completion of the
purchase of all the Securities tendered pursuant to an Asset Sale Offer and the
completion of a Pari Passu Offer, the amount of Excess Proceeds, if any, shall
be reset at zero.
(d) If the Issuer becomes obligated to make an Asset Sale Offer
pursuant to Section 4.16(c) the Securities and the Pari Passu Debt shall be
purchased by the Issuer, at the option of the holders thereof, in whole or in
part in integral multiples of $1,000, on a date that is not earlier than 30 days
and not later than 60 days from the date the notice of the Asset Sale Offer is
given to holders, or such later date as may be necessary for the Issuer to
comply with the requirements under the Exchange Act. The Issuer will comply
with the applicable tender offer rules, including Rule 14e-1 under the Exchange
Act, and any other applicable securities laws or regulations in connection with
an Asset Sale Offer.
SECTION 4.17. Limitation on Liens.
The Issuer will not, and will not permit any of its Restricted Subsidiaries
to, directly or indirectly create, incur, assume or suffer to exist any Lien
that secures obligations under any Pari Passu Debt or Subordinated Debt on any
asset or property of the Issuer or such Restricted Subsidiary, or any income or
profits therefrom, or assign or convey any right to receive income therefrom,
unless the Securities are equally and ratably secured with the obligations so
secured or until such time as such obligations are no longer secured by a Lien.
SECTION 4.18. Guarantees by Restricted Domestic Subsidiaries.
(a) The Issuer will not permit any of its Restricted Domestic
Subsidiaries, directly or indirectly, by way of the pledge of any intercompany
note or otherwise to assume, guarantee or in any other manner become liable with
respect to any Debt of the Issuer or any other Restricted Domestic Subsidiary
unless, in any such case (i) such Restricted Domestic Subsidiary that is not a
Guarantor executes and delivers a supplemental indenture to this Indenture,
providing a Guarantee of the Securities and (ii) (x) if any such assumption,
guarantee or other liability of such Restricted Domestic Subsidiary is provided
in respect of Senior Debt or Guarantor Senior Debt, the guarantee or other
instrument provided by such Restricted Domestic Subsidiary in respect of such
Senior Debt or Guarantor Senior Debt may be superior to the
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Guarantee pursuant to subordination provisions no less favorable in any material
respect to the Holders than those contained in this Indenture and (y) if such
assumption, guarantee or other liability of such Restricted Domestic Subsidiary
is provided in respect of Debt that is expressly subordinated to the Securities,
the guarantee or other instrument provided by such Restricted Domestic
Subsidiary in respect to such subordinated Indebtedness shall be subordinated to
the Guarantee pursuant to subordination provisions no less favorable in any
material respect to the Holders than those contained in this Indenture.
(b) Notwithstanding Section 4.18(a), any such Guarantee by a Restricted
Domestic Subsidiary of the Securities shall provide by its terms that it shall
be automatically and unconditionally released and discharged, without any
further action required on the part of the Trustee or any Holder, from: (i) the
unconditional release of such Restricted Domestic Subsidiary from its liability
in respect of the Debt in connection with which such Guarantee was executed and
delivered pursuant to Section 4.18(a) (including any Debt in respect of the
Senior Credit Facility); or (ii) any sale or other disposition (by merger or
otherwise) to any Person which is not a Restricted Domestic Subsidiary of the
Issuer of all of the Issuer's Capital Stock in, or all or substantially all of
the assets of, such Restricted Domestic Subsidiary or the parent of such
Restricted Domestic Subsidiary; provided that (a) such sale or disposition of
such Capital Stock or assets is otherwise in compliance with the terms of this
Indenture and (b) such assumption, guarantee or other liability of such
Restricted Domestic Subsidiary that has been released by the holders of the
other Debt guaranteed; or (iii) such Guarantor become an Unrestricted Subsidiary
in accordance with this Indenture.
SECTION 4.19. Conduct of Business of the Issuer and Its Restricted
Subsidiaries.
The Issuer and its Restricted Subsidiaries will not engage in any
businesses which are not the same, similar or related to the businesses in which
the Issuer and its Restricted Subsidiaries are engaged as of the date of this
Indenture, except to such extent as would not be material to the Issuer and its
Restricted Subsidiaries taken as a whole.
SECTION 4.20. Guarantors.
(a) So long as any Securities remain outstanding, any Restricted
Domestic Subsidiary shall (i) execute and deliver to the Trustee a supplemental
indenture in form reasonably satisfactory to the Trustee pursuant to which such
Restricted Domestic Subsidiary shall unconditionally guarantee all of the
Issuer's obligations under the Securities and this Indenture on the terms set
forth in
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this Indenture and (ii) deliver to the Trustee an Opinion of Counsel that such
supplemental indenture has been duly authorized, executed and delivered by such
Restricted Domestic Subsidiary and constitutes a legal, valid, binding and
enforceable obligation of such Restricted Domestic Subsidiary. Thereafter, such
Restricted Domestic Subsidiary shall be a Guarantor for all purposes of this
Indenture.
(b) If all the Capital Stock of any Guarantor is sold to a Person
(other than the Issuer or any of its Restricted Subsidiaries) in accordance with
the terms of this Indenture, then such Guarantor will be released and discharged
from all of its obligations under its Guarantee of the Securities and this
Indenture.
SECTION 4.21. Rule 144A Information Requirement.
The Issuer will furnish to the Holders or beneficial Holders of the
Securities and prospective purchasers of Securities designated by the Holders of
Securities, upon their request, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act for so long as is required
for an offer or sale of the Securities to qualify for an exemption under Rule
144A.
SECTION 4.22. Payments for Consent.
Neither the Issuer nor any of its Restricted 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 Securities for or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Securities unless such consideration is offered to be
paid or agreed to be paid to all Holders of the Securities that consent, waive
or agree to amend in the time frame set forth in the solicitation documents
relating to such consent, waiver or agreement, which solicitation documents must
be mailed to all Holders of the Securities a reasonable length of time prior to
the expiration of the solicitation.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Merger, Consolidation or Sale of Assets.
(a) The Issuer will not consolidate or merge with or into, or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all
of its properties or assets in one or more related transactions, to another
corporation, Person or entity
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unless: (i) the Issuer is the surviving corporation or the Person (if other than
the Issuer) formed by such consolidation or into which the Issuer is merged or
the Person that acquires by conveyance, transfer or lease substantially all of
the properties and assets of the Issuer shall be a corporation organized and
validly existing under the laws of the United States or any State thereof or the
District of Columbia; (ii) the entity or Person formed by or surviving any such
consolidation or merger (if other than the Issuer) or the entity or Person to
which such sale, assignment, transfer, lease, conveyance or other disposition
shall have been made assumes all the obligations of the Issuer under the
Securities and this Indenture pursuant to a supplemental indenture in a form
reasonably satisfactory to the Trustee; (iii) immediately after such transaction
no Default or Event of Default exists; and (iv) except in the case of a merger
of the Issuer with or into a Wholly Owned Restricted Subsidiary of the Issuer,
the Issuer or the entity or Person formed by or surviving any such consolidation
or merger (if other than the Issuer), or to which such sale, assignment,
transfer, lease, conveyance or other disposition shall have been made (x) will
have Consolidated Net Worth immediately after the transaction equal to or
greater than the Consolidated Net Worth of the Issuer immediately preceding the
transaction and (y) will, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning of the
applicable four-quarter period, be permitted to incur at least $1.00 of
additional Debt pursuant to the Consolidated Fixed Charge Coverage Ratio test
set forth in Section 4.12 (a).
(b) Each Guarantor (other than any Guarantor whose Guarantee is to be
released in accordance with the terms of the Guarantee and this Indenture in
connection with any transaction complying with the provisions of Section 4.16)
will not, and the Issuer will not cause or permit any Guarantor to, consolidate
with or merge with or into, or sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its properties or assets to any
Person other than the Issuer or any other Guarantor unless: (i) such Guarantor
is the surviving corporation or the Person (if other than a Guarantor) formed by
such consolidation or into which such Guarantor is merged or the Person that
acquires by conveyance, transfer or lease substantially all of the properties
and assets of such Guarantor shall be a corporation organized and existing under
the laws of the United States or any State thereof or the District of Columbia;
(ii) such entity or Person formed by or surviving any such consolidation or
merger (if other than the Guarantor) or the entity or Person to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made assumes all of the obligations of the Guarantor under the Guarantee
pursuant to a supplemental indenture in a form reasonably satisfactory to the
Trustee; (iii) immediately after such transaction, no Default or Event of
Default exists; and (iv) except
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in the case of a merger of the Guarantor with or into the Issuer, immediately
after giving effect to such transaction and the use of any net proceeds
therefrom on a pro forma basis the Issuer could satisfy the provisions of clause
(iv) of Section 5.01(a).
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
Each of the following shall be an "Event of Default":
(1) the failure to pay interest on any Securities when the same
becomes due and payable and the default continues for a period of 30 days
(whether or not such payment shall be prohibited by Article Ten);
(2) the failure to pay the principal of or premium, if any, on any
Securities, when such principal or premium, if any, becomes due and
payable, at maturity, acceleration upon optional or mandatory redemption,
required repurchase or otherwise (including the failure to make a payment
to repurchase Securities tendered pursuant to a Change of Control Offer or
an Asset Sales Offer) (whether or not such payment shall be prohibited by
Article Ten);
(3) the failure by the Issuer for 30 days after notice from either
the Trustee or the Holders of at least 25% in principal amount of the then
outstanding Securities to conform or comply with any covenant, agreement or
warranty contained in Sections 4.10, 4.12, 4.15, 4.16 or Article Five or
the corresponding provisions of the Securities;
(4) failure to conform or comply with any other covenant, agreement or
warranty in the Securities or this Indenture for 60 days after notice
thereof has been given to the Issuer by the Trustee or by the Holders of at
least 25% in principal amount of the then outstanding Securities;
(5) any Guarantees of a Significant Restricted Domestic Subsidiary
cease to be in full force and effect or any of the Guarantors that is a
Significant Restricted Domestic Subsidiary denies its liability under its
Guarantee (other than by reason of a release of a Guarantee in accordance
with the terms of this Indenture or such Guarantee);
(6) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be
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secured or evidenced any Debt for money borrowed by the Issuer or any of
its Restricted Subsidiaries (or the payment of which is guaranteed by the
Issuer or any of its Restricted Subsidiaries) whether such Debt or
guarantee now exists, or is created after the date of this Indenture, which
default (a) is caused by a failure to pay principal of, premium, if any, or
interest on such Debt at the final stated maturity thereof (giving effect
to any extensions thereof) (a "Payment Default") or (b) results in the
acceleration of such Debt prior to its express maturity and, in each case,
the principal amount of any such Debt, together with the principal amount
of any other such Debt or the maturity of which has been so accelerated,
aggregates $5.0 million or more;
(7) failure by the Issuer or any of its Significant Restricted
Subsidiaries to pay final judgments aggregating in excess of $3.0 million
(to the extent not covered by third party insurance as to which the
insurance company has acknowledged coverage), which judgments are not paid,
discharged or stayed for a period of 60 days after their entry;
(8) there shall have been the entry by a court of competent
jurisdiction of (a) a decree or order for relief in respect of the Issuer
or any of its Significant Restricted Subsidiaries in an involuntary case or
proceeding under any applicable Bankruptcy Law or (b) a decree or order
adjudging the Issuer or any of its Significant Restricted Subsidiaries
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment
or composition of or in respect of the Issuer or any of its Significant
Restricted Subsidiaries under any applicable federal or state law, or
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of the Issuer or any of its
Significant Restricted Subsidiaries or of substantially all of their
respective properties, or ordering the winding up or liquidation of their
affairs, and any such decree or order for relief shall continue to be in
effect, or any such other decree or order shall be unstayed and in effect,
for a period of 60 days provided that if any order is dismissed on appeal
then such Event of Default shall be deemed cured; or
(9) (a) the Issuer or any of its Significant Restricted Subsidiaries
commences a voluntary case or proceeding under any applicable Bankruptcy
Law or any other case or proceeding to be adjudicated bankrupt or
insolvent, (b) the Issuer or any of its Significant Restricted Subsidiaries
consents to the entry of a decree or order for relief in respect of the
Issuer or such Significant Restricted Subsidiary in an involuntary case or
proceeding under any applicable Bankruptcy Law or to
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the commencement of any bankruptcy or insolvency case or proceeding against
it, (c) the Issuer or any of its Significant Restricted Subsidiaries files
a petition or answer or consent seeking reorganization or relief under any
applicable federal or state bankruptcy law, (d) the Issuer or any of its
Significant Restricted Subsidiaries (x) consents to the filing of such
petition or the appointment of or taking possession by, a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Issuer or such Significant Restricted Subsidiary or of
substantially all of their respective property, or (y) makes an assignment
for the benefit of creditors or (e) the Issuer or any of its Significant
Restricted Subsidiaries takes any corporate action in furtherance of any
such actions in this paragraph (9).
In the case of any Event of Default occurring by reason of any willful
action (or inaction) taken (or not taken) by or on behalf of the Issuer with the
intention of avoiding payment of the premium that the Issuer would have had to
pay if the Issuer then had elected to redeem the Securities pursuant to the
optional redemption provision of this Indenture, an equivalent premium shall
also become and be immediately due and payable to the extent permitted by law
upon the acceleration of the Securities. If an Event of Default occurs prior to
September 15, 2003 by reason of any willful action (or inaction) taken (or not
taken) by or on behalf of the Issuer with the intention of avoiding the
prohibition on redemption of the Securities prior to September 15, 2003, then
the premium specified in this Indenture shall also become immediately due and
payable to the extent permitted by law upon the acceleration of the Securities.
SECTION 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in
paragraph (8) or (9) of Section 6.01 with respect to the Issuer) occurs and is
continuing and has not been waived pursuant to Section 6.04, the Trustee may, by
notice to the Issuer, or the Holders of at least 25% in principal amount of the
Securities then outstanding by written notice to the Issuer, and the Trustee
shall, upon the request of such Holders, declare the aggregate principal amount
of the Securities outstanding, together with accrued but unpaid interest, if
any, on all Securities to be due and payable by notice in writing to the Issuer
and the Trustee specifying the respective Event of Default and that it is a
"notice of acceleration" (the "Acceleration Notice"), and, if the applicable
Event of Default is then continuing, the Securities outstanding (i) shall become
immediately due and payable or (ii) if there are any amounts outstanding under
the Senior Credit Facilities, shall become due and payable upon the first to
occur of an acceleration under the Senior Credit Facilities or 5 Business
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Days after receipt by the Issuer and the Representative under the Senior Credit
Facilities of such Acceleration Notice (unless all Events of Default specified
in such Acceleration Notice have been cured or waived). If an Event of Default
specified in paragraph (8) or (9) of Section 6.01 with respect to the Issuer
occurs and is continuing, all unpaid principal and accrued interest on the
Securities then outstanding shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Securityholder. The Holders of a majority in principal amount of the Securities
then outstanding (by notice to the Trustee) may waive any existing Default or
Event of Default and may rescind and cancel a declaration of acceleration and
its consequences if (i) the rescission would not conflict with any judgment or
decree of a court of competent jurisdiction, (ii) all existing Events of Default
have been cured or waived, except non-payment of the principal or interest on
the Securities which have become due solely by such declaration of acceleration,
(iii) to the extent the payment of such interest is lawful, interest (at the
same rate as specified in the Securities) on overdue installments of interest
and overdue payments of principal, which has become due otherwise than by such
declaration of acceleration, has been paid, and (iv) in the event of the cure or
waiver of a Default or Event of Default of the type described in paragraphs (8)
and (9) of Section 6.01, the Trustee shall have received an Officers'
Certificate that such Default or Event of Default has been cured or waived and
the Trustee shall be entitled to conclusively rely upon such Officers'
Certificate. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal of or interest on the Securities or to enforce the
performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
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Subject to Sections 6.07 and 9.02, the Holders of a majority in
principal amount of the outstanding Securities by notice to the Trustee may
waive an existing Default or Event of Default and its consequences, except (i) a
continuing Default or Event of Default in the payment of the principal of, or
premium, if any, or interest on, the Securities (which may only be waived with
the consent of each Holder of Securities affected) or (ii) in respect of any
covenant or provision hereunder which cannot be modified or amended without the
consent of the Holder of each Security outstanding.
SECTION 6.05. Control by Majority.
The Holders of a majority in principal amount of the outstanding
Securities may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it, including, without limitation, any remedies provided for in
Section 6.03. Subject to Section 7.01, however, the Trustee may, in its
discretion, refuse to follow any direction that conflicts with any law or this
Indenture, that the Trustee determines may be unduly prejudicial to the rights
of another Securityholder, or that may involve the Trustee in personal
liability; provided that the Trustee may take any other action deemed proper by
the Trustee, in its discretion, which is not inconsistent with such direction.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(1) the Holder gives to the Trustee notice of a continuing Event of
Default;
(2) Holders of at least 25% in principal amount of the outstanding
Securities make a written request to the Trustee to pursue the remedy;
(3) such Holders offer to the Trustee indemnity or security against
any loss, liability or expense to be incurred in compliance with such
request which is reasonably satisfactory to the Trustee;
(4) the Trustee does not comply with the request within 45 days after
receipt of the request and the offer of satisfactory indemnity or security;
and
(5) during such 45-day period the Holders of a majority in principal
amount of the outstanding Securities do not give
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the Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal of and interest on a Security, on or
after the respective due dates expressed in such Security, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or interest specified
in paragraphs (1) or (2) of Section 6.01 occurs and is continuing, the Trustee
may recover judgment in its own name and as trustee of an express trust against
the Issuer or any other obligor on the Securities for the whole amount of
principal 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 at the rate set forth in the
Securities and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses, taxes,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings, relating to the Issuer or
any other obligor upon the Securities, any of their respective creditors or any
of their respective property, and shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same, and any Custodian in any such judicial proceedings
is hereby authorized by each Securityholder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Securityholders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, taxes, disbursements and advances of the
Trustee, its agents and counsel, and any other
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amounts due the Trustee under Section 7.07. The Issuer's payment obligations
under this Section 6.09 shall be secured in accordance with the provisions of
Section 7.07. Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Securityholder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
Subject to Article Ten, if the Trustee collects any money pursuant to
this Article Six, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Sections 6.09 and 7.07;
Second: if the Holders are forced to proceed against the Issuer
directly without the Trustee, to Holders for their collection costs;
Third: to Holders for amounts due and unpaid on the Securities for
principal and interest, ratably, without preference or priority of any
kind, according to the amounts due and payable on the Securities for
principal and interest, respectively; and
Fourth: to the Issuer or any other obligor on the Securities, as their
interests may appear, or as a court of competent jurisdiction may direct.
The Trustee, upon prior notice to the Issuer, may fix a record date
and payment date for any payment to Securityholders pursuant to this Section
6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by
a Holder pursuant to
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Section 6.07, or a suit by a Holder or Holders of more than 10% in principal
amount of the outstanding Securities.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If a Default or an Event of Default actually known to 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 its exercise thereof as a prudent person would exercise or use under
the circumstances in the conduct of its own affairs.
(b) Except during the continuance of a Default or an Event of Default
actually known to the Trustee:
(1) The Trustee need perform only those duties as are specifically set
forth in this Indenture and the TIA and no duties, covenants,
responsibilities or obligations shall be implied in this Indenture that are
adverse to the Trustee.
(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 (including Officers'
Certificates) or opinions (including Opinions of Counsel) furnished to the
Trustee and conforming to the requirements of this Indenture. However, as
to any certificates or opinions which are required by any provision of this
Indenture to be delivered or provided to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture, but not to verify the
contents thereof.
(c) Notwithstanding anything to the contrary herein contained, 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 Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts.
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(3) The Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.02, 6.04 or 6.05.
(d) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on any money or
assets received by it except as the Trustee may agree in writing with the
Issuer. Assets held in trust by the Trustee need not be segregated from other
assets except to the extent required by law.
(g) In the absence of bad faith, negligence or wilful misconduct on
the part of the Trustee, the Trustee shall not be responsible for the
application of any money by any Paying Agent other than the Trustee.
SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may request and rely and shall be fully protected in
acting or refraining from acting upon any document believed by it to be
genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate or an Opinion of
Counsel, which shall conform to Sections 13.04 and 13.05. The Trustee
shall not be liable for and shall be fully protected in respect of any
action it takes or omits to take in good faith in reliance on such
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent or attorney
appointed with due care.
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(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it reasonably believes to be authorized
or within its rights or powers.
(e) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate (including any
Officers' Certificate), statement, instrument, opinion (including any
Opinion of Counsel), notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters
as it may see fit and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled, upon reasonable notice to
the Issuer, to examine the books, records, and premises of the Issuer,
personally or by agent or attorney.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders of the Securities pursuant to the
provisions of this Indenture, unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred by it in compliance with such request,
order or direction.
(g) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability with respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance with the advice or
opinion of such counsel.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Issuer, any
Subsidiary of the Issuer, or their respective Affiliates, with the same rights
it would have if it were not Trustee, subject to Section 7.10. Any Agent may do
the same with like rights. However, the Trustee must comply with Sections 7.10
and 7.11.
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SECTION 7.04. Disclaimer of Trustee.
The Trustee does not make any representation as to the validity,
effectiveness or adequacy of this Indenture or the Securities, and it shall not
be accountable for the Issuer's use of the proceeds from the Securities, the
Trustee shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement of the Issuer in this Indenture, the Securities
other than the Trustee's certificate of authentication or any document issued in
connection with the sale of the Securities.
SECTION 7.05. Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to each Holder notice of the
uncured Default or Event of Default within 90 days after such Default or Event
of Default occurs. Except in the case of a Default or an Event of Default in
payment of principal of, or interest on, any Security, including an accelerated
payment and the failure to make payment on the Change of Control Payment Date
pursuant to a Change of Control Offer or on the Asset Sale Offer Purchase Date
pursuant to an Asset Sale Offer, and, except in the case of a failure to comply
with Article Five, the Trustee may withhold the notice if and so long as its
Board of Directors, the executive committee of its Board of Directors or a
committee of its directors and/or Trust Officers in good faith determines that
withholding the notice is in the interest of the Holders. This Section 7.05
shall be in lieu of the proviso to (S)315(b) of the TIA and such proviso to
(S)315(b) of the TIA is hereby expressly excluded from this Indenture and the
Securities, as permitted by the TIA. The Trustee shall not be deemed to have
knowledge of a Default or Event of Default other than (i) any Event of Default
occurring pursuant to Section 6.01(1), 6.01(2) or 4.01; or (ii) any Default or
Event of Default of which a Trust Officer shall have received written
notification or obtained actual knowledge.
SECTION 7.06. Reports by Trustee to Holders.
Within 60 days after May 15 of each year beginning with May 15, 1998,
the Trustee shall, to the extent that any of the events described in TIA (S)
313(a) occurred within the previous twelve months, but not otherwise, mail to
each Holder a brief report dated as of such date that complies with TIA (S)
313(a). The Trustee also shall comply with TIA (S)(S) 313(b) and 313(c).
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A copy of each report at the time of its mailing to Holders shall be
mailed to the Issuer and filed with the SEC and each stock exchange, if any, on
which the Securities are listed.
The Issuer shall promptly notify the Trustee if the Securities become
listed on any stock exchange and the Trustee shall comply with TIA (S) 313(d).
SECTION 7.07. Compensation and Indemnity.
The Issuer shall pay to the Trustee in its capacity as such from time
to time such compensation as may be agreed upon in writing by the Issuer and the
Trustee. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. Subject to the limitations set
forth in the following paragraph, the Issuer shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses, disbursements and advances
incurred or made by it in connection with the performance of its duties and the
discharge of its obligations under this Indenture. Such expenses shall include
the reasonable fees and expenses of the Trustee's agents and counsel.
The Issuer shall indemnify the Trustee and its agents, employees,
officers, stockholders and directors for and hold them harmless against any
loss, liability, damage, claim or expense incurred by them except for such loss,
liablility, damage, claims or expenses or actions to the extent caused by any
negligence, bad faith or willful misconduct on any of their part, arising out of
or in connection with the acceptance or administration of this trust including
the reasonable costs and expenses of defending themselves against any claim or
liability in connection with the exercise or performance of any of their rights,
powers or duties hereunder. The Trustee shall notify the Issuer promptly of any
claim asserted against the Trustee, its agents, employees, officers,
stockholders or directors for which indemnity may be sought. The Issuer shall
defend the claim and the Trustee shall cooperate in the defense. The Trustee may
have separate counsel and the Issuer shall pay the reasonable fees and expenses
of one such counsel. The Issuer need not pay for any settlement made without
its written consent, which consent shall not be unreasonably withheld. The
Issuer need not reimburse any expense or indemnify against any loss or liability
to the extent incurred by the Trustee, its agents, employees, officers,
stockholders or directors through its negligence, bad faith or willful
misconduct.
To secure the Issuer's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Securities on all assets or money held or
collected by the Trustee, in its capacity as Trustee, as the case may be, except
assets or money
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held in trust to pay principal of or interest on particular Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(8) or (9) occurs, such expenses and the
compensation for such services shall be paid to the extent allowed under any
Bankruptcy Law.
The provisions of this Section 7.07 shall survive the resignation or
removal of the Trustee, the discharge of the Issuer's obligations under Article
Eight or any rejection or the termination of this Indenture under any Bankruptcy
Law or otherwise.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Issuer in writing. The
Holders of a majority in principal amount of the outstanding Securities may
remove the Trustee by so notifying the Issuer in writing and the Trustee and may
appoint a successor trustee. The Issuer may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Issuer shall notify each Holder of such
event and shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Securities may appoint a successor Trustee to replace the successor Trustee
appointed by the Issuer.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. Promptly after that, the
retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in Section 7.07, the resignation
or removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Securityholder.
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If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 10% in principal amount of the outstanding Securities may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Issuer's obligations under Section 7.07 shall continue for the benefit
of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
Person, the resulting, surviving or transferee Person without any further act
shall, if such resulting, surviving or transferee Person is otherwise eligible
hereunder, be the successor Trustee; provided that such Person shall be
otherwise qualified and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirement of TIA (S)(S) 310(a)(1) and 310(a)(2). The Trustee (or in the case
of a corporation included in a bank holding company system, the related bank
holding company) 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. In addition, if the Trustee is a corporation included in a bank
holding company system, the Trustee, independently of such bank holding company,
shall meet the capital requirements of TIA (S) 310(a)(2). The Trustee shall
comply with TIA (S) 310(b); provided, however, that there shall be excluded from
the operation of TIA (S) 310(b)(1) any indenture or indentures under which other
securities, or certificates of interest or participation in other securities, of
the Issuer are outstanding, if the requirements for such exclusion set forth in
TIA (S) 310(b)(1) are met. The provisions of TIA (S) 310 shall apply to the
Issuer and any other obligor of the Securities.
SECTION 7.11. Preferential Collection of Claims Against the Issuer.
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
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extent indicated therein. The provisions of TIA (S) 311 shall apply to the
Issuer and any other obligor of the Securities.
ARTICLE EIGHT
DISCHARGE OF THIS INDENTURE; DEFEASANCE
SECTION 8.01. Option to Effect Defeasance or Covenant Defeasance.
The Issuer may, at its option, at any time, with respect to the
Securities, elect to have either Section 8.02 or Section 8.03 be applied to all
Securities upon compliance with the conditions set forth below in this Article
Eight.
SECTION 8.02. Defeasance and Discharge.
Upon the Issuer's exercise under Section 8.01 of the option applicable
to this Section 8.02, the Issuer shall be deemed to have been discharged from
its obligations with respect to all Securities on the date the conditions set
forth below are satisfied (hereinafter, "defeasance"). For this purpose, such
defeasance means that the Issuer shall be deemed to have paid and discharged the
entire amount of Debt represented by the Securities, which shall thereafter be
deemed to be "Outstanding" until paid in full in cash only for the purposes of
Section 8.05 and the other Sections of this Indenture referred to in clauses (A)
and (B) below, and to have satisfied all its other obligations under such
Securities and this Indenture (and the Trustee, on demand of and at the expense
of the Issuer, shall execute proper instruments acknowledging the same), except
for the following which shall survive until the Securities are paid in full in
cash otherwise terminated or discharged hereunder: (A) the rights of Holders of
Securities to receive solely from the trust fund described in Section 8.04 and
as more fully set forth in such Section, payments in respect of the principal of
(and premium, if any) and interest on such Securities when such payments are
due, (B) the Issuer's obligations with respect to such Securities under Sections
2.03, 2.04 through and including 2.11 and 2.14, (C) the rights, powers, trusts,
duties and immunities of the Trustee hereunder and the Issuer's obligations in
connection therewith and (D) this Article Eight. Subject to compliance with
this Article Eight, the Issuer may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 with respect
to the Securities.
SECTION 8.03. Covenant Defeasance.
Upon the Issuer's exercise under Section 8.01 of the option applicable to
this Section 8.03, the payment of the Securities may
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not be accelerated pursuant to Section 6.02 upon, or as a result of, an Event of
Default set forth in Sections 6.01(3), (4), (5), (7) or (9) with respect to the
Securities on and after the date the conditions set forth below are satisfied
(hereinafter, "covenant defeasance"), and the Securities shall thereafter be
deemed to be not "Outstanding" for the purposes of any direction, waiver,
consent or declaration or act of Holders (and the consequences of any thereof)
in connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder (it being understood that such Securities shall
not be deemed Outstanding for financial accounting purposes). Except as
specified above, the remainder of this Indenture and the Securities shall be
unaffected by a covenant defeasance.
SECTION 8.04. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either Section
8.02 or Section 8.03 to the Securities:
(a) The Issuer shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements
of Section 7.10 who shall agree to comply with the provisions of this
Article Eight applicable to it) as trust 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 such Securities, (A)
cash in U.S. Dollars 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 one day before
the due date of any payment, cash in U.S. Dollars 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,
(i) the principal of (and premium, if any) and interest on the Securities
on the Stated Maturity of such principal or installment of principal (and
premium, if any) or interest and (ii) any mandatory sinking fund payments
or analogous payments applicable to the Securities on the day on which such
payments are due and payable in accordance with the terms of this Indenture
and of such Securities; provided that the Trustee shall have been
irrevocably instructed to apply such money or the proceeds of such U.S.
Government Obligations to said payments with respect to the Securities. For
this purpose, "U.S. Government Obligations" means securities that are (x)
direct obligations of the United States of America for the timely payment
of which its full faith and credit is pledged or (y) obligations of a
Person
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controlled or supervised by and acting as an agency or instrumentality of
the United States of America the timely 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 the specific payment of
principal of or interest on the U.S. Government Obligation evidenced by
such depository receipt.
(b) No Default or Event of Default with respect to the Securities
shall have occurred and be continuing on the date of such deposit or would
occur as a consequence thereof (other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit) or,
insofar as Section 6.01(8) or 6.01(9) is concerned, at any time during the
period ending on the 91st day after the date of such deposit (it being
understood that this condition shall not be deemed satisfied until the
expiration of such period).
(c) No event or condition shall exist that, pursuant to the provisions
of Section 10.02 or 10.03, would prevent the Issuer from making payments of
the principal of (and premium, if any) or interest on the Securities on the
date of such deposit or at any time during the period ending on the 91st
day after the date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such period).
(d) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a default under any material
agreement or instrument to which the Issuer or any of its Restricted
Subsidiaries is a party or by which the Issuer or any of its Restricted
Subsidiaries is bound.
(e) In the case of an election under Section 8.02, the Issuer shall
have delivered to the Trustee an Opinion of Counsel in the United States
stating that (x) the Issuer has received from, or there has been published
by, the Internal Revenue Service a ruling or (y) otherwise since the date
hereof, there has been a change in the applicable federal
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income tax law, in either case to the effect that, and based thereon such
opinion shall confirm that, the Holders of the Securities will not
recognize income, gain or loss for federal income tax purposes as a result
of such defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such defeasance had not occurred.
(f) In the case of an election under Section 8.03, the Issuer shall
have delivered to the Trustee an Opinion of Counsel in the United States to
the effect that the Holders of the Securities will not recognize income,
gain or loss for federal income tax purposes as a result of such covenant
defeasance and will be subject to federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such covenant defeasance had not occurred.
(g) In the case of an election under either Section 8.02 or 8.03, the
Issuer shall have delivered to the Trustee an Opinion of Counsel in the
United States to the effect that after the 91st day following the date of
such deposit, such trust funds will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally.
(h) In the case of an election under either Section 8.02 or 8.03, the
Issuer shall represent to the Trustee that the deposit made by the Issuer
pursuant to its election under Section 8.02 or 8.03 was not made by the
Issuer with the intent of preferring the Holders over other creditors of
the Issuer or with the intent of defeating, hindering, delaying or
defrauding creditors of the Issuer or others.
(i) The Issuer shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel in the United States, each stating
that all conditions precedent provided for relating to either the
defeasance under Section 8.02 or the covenant defeasance under Section 8.03
(as the case may be) have been complied with.
SECTION 8.05. Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions.
Subject to the provisions of Section 12 of the Securities, all money
and U.S. Government Obligations (including the proceeds thereof) deposited with
the Trustee (or other qualifying trustee, collectively for purposes of this
Section 8.05, the "Trustee") pursuant to Section 8.04 in respect of the
Securities shall be held in trust and applied by the Trustee, in
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accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Issuer
acting as its own Paying Agent) as the Trustee may determine, to the Holders of
such Securities of all sums due and to become due thereon in respect of
principal (and premium, if any) and interest, but such money need not be
segregated from other funds except to the extent required by law. Money and U.S.
Government Obligations so held in trust are not subject to Article Ten or Twelve
hereof.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or U.S. Government
Obligations deposited pursuant to Section 8.04 or the principal 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 Securities.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuer from time to time upon Issuer's
request together with an Officers' Certificate any money or U.S. Government
Obligations held by it as provided in Section 8.04 which are in excess of the
amount thereof which would then be required to be deposited to effect an
equivalent defeasance or covenant defeasance. If any money or U.S. Government
Obligations held by the Trustee for the payment of principal or interest remains
unclaimed on the first anniversary of the Maturity Date of the Securities, the
Trustee shall promptly, or shall cause the prompt, return of such money or U.S.
Government Obligations. After the return of such money or U.S. Government
Obligations, all liability of the Trustee with respect to such money or U.S.
Government Obligations shall cease.
SECTION 8.06. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money in
accordance with Section 8.02 or 8.03, as the case may be, by reason of any order
or judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, then the Issuer's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.02 or 8.03, as the case may be, until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02 or 8.03, as the case may be; provided, however,
that, if the Issuer makes any payment of principal of (or premium, if any) or
interest on any Security following the reinstatement of its obligations, the
Issuer shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money held by the Trustee or Paying Agent.
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ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Issuer and the Guarantors, when authorized by a Board Resolution,
and the Trustee, together, may amend or supplement this Indenture or the
Securities without notice to or consent of any Holder:
(1) to cure any ambiguity, defect or inconsistency; provided that such
amendment or supplement does not, in the opinion of the Trustee, adversely
affect the rights of any of the Holders in any material respect;
(2) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(3) to provide for the assumption of the Issuer's obligations to
Holders of the Securities in the event of any Disposition involving the
Issuer in which the Issuer is not a Surviving Person;
(4) to make any change that would provide any additional rights or
benefits to the Holders of the Securities or that does not adversely affect
the legal rights under this Indenture of any such Holder;
(5) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act;
(6) to provide for the issuance of the Exchange Securities (which will
have terms identical in all material respects to the Securities issued on
the Issue Date except that the transfer restrictions contained in the
Securities issued on the Issue Date will be modified or eliminated, as
appropriate), and which will be treated together with any outstanding
Securities issued on the Issue Date, as a single issue of Securities;
(7) to reflect the release of a Guarantor from its Obligations with
respect to its Guarantee or to add a Guarantor each in accordance with the
terms of this Indenture;
(8) to evidence the succession of another person to any Guarantor and
the assumption by such successor of the Obligations in the Guarantee in
accordance with the terms of this Indenture;
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(9) to surrender any right or power conferred on the Issuer or any
Guarantor in accordance with the terms of this Indenture; or
(10) to secure the Securities in accordance with Section 4.17;
provided that the Issuer has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.01.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Issuer and the Guarantors, when
authorized by a Board Resolution, and the Trustee, together, with the written
consent of the Holder or Holders of at least a majority in principal amount of
the outstanding Securities may amend or supplement this Indenture or the
Securities, without notice to any other Holders. Subject to Sections 6.04 and
6.07, the Holder or Holders of a majority in aggregate principal amount of the
outstanding Securities may waive compliance by the Issuer or the Guarantors with
any provision of this Indenture, the Securities or the Guarantees without notice
to any other Holders.
No amendment, supplement or waiver, including a waiver pursuant to
Section 6.04, shall, directly or indirectly, without the consent of each Holder
of each Security affected thereby:
(1) reduce the principal amount of the Securities whose Holders must
consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any
Security, or alter the provisions with respect to the redemption of the
Securities in a manner adverse to the Holders of the Securities (other than
provisions relating to Section 4.15);
(3) reduce the rate of or change the time for payment of interest on
any Security;
(4) waive a Default or Event of Default in the payment of principal
of, premium, if any, or interest on, the Securities (except that Holders of
at least a majority in aggregate principal amount of the then outstanding
Securities may (a) rescind an acceleration of the Securities that resulted
from a non-payment default, and (b) waive the payment default that resulted
from such acceleration);
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(5) make any Security payable in money other than that stated in the
Securities;
(6) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Securities to receive
payments of principal of, or premium, if any, or interest on, the
Securities;
(7) waive a redemption payment with respect to any Security (other
than a payment required by Section 4.15);
(8) make any change to the subordination provisions of this Indenture
that adversely affects Holders;
(9) release any Significant Restricted Domestic Subsidiary from any of
its obligations under its Guarantee or hereunder other than in accordance
with the terms hereunder; or
(10) make any change in the foregoing amendment and waiver provisions.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 9.02
becomes effective (as provided in Section 9.04), the Issuer shall mail to the
Holders affected thereby a notice briefly describing the amendment, supplement
or waiver.
SECTION 9.03. Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
No amendment of this Indenture shall adversely affect in any material
respect the rights of any holder of Senior Debt under Article Ten or Guarantor
Senior Debt under Article Twelve without the consent of such holder.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. Subject to the following paragraph, any such Holder or
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subsequent Holder may revoke the consent as to his Security or portion of his
Security by notice to the Trustee or the Issuer received before the date on
which the Trustee receives an Officers' Certificate certifying that the Holders
of the requisite principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver (at
which time such amendment, supplement or waiver shall become effective).
The Issuer may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be at least 30 days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to revoke any consent previously
given, whether or not such Persons continue to be Holders after such record
date. No such consent shall be valid or effective for more than 120 days after
such record date.
After an amendment, supplement or waiver becomes effective, it shall
bind every Holder, unless it makes a change described in any of clauses (1)
through (6) of Section 9.02, in which case, the amendment, supplement or waiver
shall bind only each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security; provided that any such waiver shall
not impair or affect the right of any Holder to receive payment of principal of,
premium, if any, and interest on a Security, on or after the respective due
dates expressed in such Security, or to bring suit for the enforcement of any
such payment on or after such respective dates without the consent of such
Holder.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Issuer or the Trustee
so determine, the Issuer in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
Failure to make the appropriate notation or issue a new Security shall not
affect the validity and effect of such amendment, supplement or waiver.
SECTION 9.06. Trustee To Sign Amendments, etc.
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The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to and adopted in accordance with this Article Nine;
provided that the Trustee may, but shall not be obligated to, execute any such
amendment, supplement or waiver which affects the Trustee's own rights, duties
or immunities under this Indenture. The Trustee shall be entitled to receive,
and shall be fully protected in relying upon, an Opinion of Counsel and an
Officers' Certificate each stating that the execution of any amendment,
supplement or waiver authorized pursuant to this Article Nine is authorized or
permitted by this Indenture. Such Opinion of Counsel shall not be an expense of
the Trustee.
ARTICLE TEN
SUBORDINATION OF SECURITIES
SECTION 10.01. Securities Subordinated to Senior Debt.
The Issuer covenants and agrees and the Trustee and each Holder of the
Securities, by its acceptance thereof, likewise covenants and agrees, that all
Securities shall be issued subject to the provisions of this Article Ten; and
the Trustee and each Person holding any Security, whether upon original issue or
upon transfer, assignment or exchange thereof, accepts and agrees that the
payment of all Obligations on the Securities by the Issuer shall, to the extent
and in the manner herein set forth, be subordinated and junior in right of
payment to the prior payment in full in cash of all Obligations on the Senior
Debt; that the subordination is for the benefit of, and shall be enforceable
directly by, the holders of Senior Debt, and that each holder of Senior Debt,
whether now outstanding or hereafter created, incurred, assumed or guaranteed,
shall be deemed to have acquired Senior Debt in reliance upon the covenants and
provisions contained in this Indenture and the Securities.
SECTION 10.02. No Payment on Securities in Certain Circumstances.
(a) Neither the Issuer nor any Person on behalf of the Issuer may make
any payment of any kind or character upon or in respect of the Securities
(except as permitted under Article Eight of this Indenture) if (i) a default in
the payment of the principal of, premium, if any, interest on, unpaid drawings
for letters of credit issued in respect of, or regularly accruing fees with
respect to, any Designated Senior Debt occurs and is continuing or (ii) any
other default occurs and is continuing with respect to Designated Senior Debt
that permits holders of the Designated Senior Debt as to which such default
relates to accelerate its maturity and, in the case of this clause (ii), the
Trustee receives a notice of such default (a "Payment Blockage Notice") from the
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Representative of any Designated Senior Debt. Payments on the Securities may and
shall be resumed (x) in the case of a payment default described in clause (i)
above, upon the date on which such default is cured or waived and (y) in case of
a default described in clause (ii) above, the earlier of (a) the date on which
all such defaults have been cured or waived, (b) 179 days after the date on
which the applicable Payment Blockage Notice is received, (c) the date such
Designated Senior Debt shall have been paid in full in cash or (d) the date such
Payment Blockage Period shall have been terminated by written notice to the
Trustee from the Representative of the Designated Senior Debt initiating such
Payment Blockage Period, after which, in the case of clauses (a), (b), (c) and
(d), the Issuer shall resume making any and all required payments in respect of
the Securities, including any payments not made to the Holders of the Securities
during the Payment Blockage Period due to the foregoing prohibitions, unless the
provisions described in clause (i) above or the provisions of Section 10.03 are
then applicable. No new Payment Blockage Period may be commenced unless and
until 360 days have elapsed since the effectiveness of the immediately prior
Payment Blockage Notice. No default that existed or was continuing on the date
of delivery of any Payment Blockage Notice to the Trustee shall be, or be made,
the basis for a subsequent Payment Blockage Notice unless such default shall
have been cured or waived for a period of not less than 90 days (it being
acknowledged that any subsequent action, or any breach of any financial
covenants for a period commencing after the date of commencement of such Payment
Blockage Period, that, in either case, would give rise to such a default
pursuant to any provision under which such default previously existed or was
continuing shall constitute a new default for this purpose).
(b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is prohibited
by Section 10.02(a), such payment shall be held for the benefit of, and shall be
paid over or delivered to, the holders of Senior Debt (pro rata to such holders
on the basis of the respective amount of Senior Debt held by such holders) or
their respective Representatives, as their respective interests may appear. The
Trustee shall be entitled to rely on information regarding amounts then due and
owing on the Senior Debt, if any, received from the holders of Senior Debt (or
their Representatives) or, if such information is not received from such holders
or their Representatives, from the Issuer and only amounts included in the
information provided to the Trustee shall be paid to the holders of Senior Debt.
(c) Nothing contained in this Article Ten shall limit the right of the
Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Section 6.02 or to pursue any rights or
remedies hereunder;
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provided that all Senior Debt thereafter due or declared to be due shall first
be paid in full in cash before the Holders are entitled to receive any payment
with respect to Obligations on the Securities.
SECTION 10.03. Payment Over of Proceeds upon Dissolution, etc.
(a) Upon any payment or distribution of assets of the Issuer of any
kind or character, whether in cash, property or securities, to creditors upon
any total or partial liquidation, dissolution, winding-up, reorganization,
assignment for the benefit of creditors or marshalling of assets of the Issuer
or in a bankruptcy, reorganization, insolvency, receivership or other similar
proceeding relating to the Issuer or its property, whether voluntary or
involuntary, all Obligations due or to become due upon all Senior Debt
(including interest accruing after the commencement of any such proceeding at
the rate specified in the applicable Senior Debt whether or not such interest is
an allowed claim in any such proceeding) shall first be paid in full in cash
before any payment or distribution of any kind or character is made on account
of any Obligations on the Securities, or for the acquisition of any of the
Securities for cash or property or otherwise (except that Holders of the
Securities may receive Permitted Junior Securities and payments made from the
trust described in Article Eight hereof). Upon any such dissolution, winding-
up, liquidation, reorganization, receivership or similar proceeding, any payment
or distribution of assets of the Issuer of any kind or character, whether in
cash, property or securities, to which the Holders of the Securities or the
Trustee under this Indenture would be entitled, except for the provisions
hereof, shall be paid by the Issuer or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or distribution,
or by the Holders of the Securities or by the Trustee under this Indenture if
received by them, directly to the holders of Senior Debt (pro rata to such
holders on the basis of the respective amounts of Senior Debt held by such
holders) or their respective Representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Debt may have been
issued, as their respective interests may appear, for application to the payment
of Senior Debt remaining unpaid until all such Senior Debt has been paid in full
in cash after giving effect to any concurrent payment, distribution or provision
therefor to or for the holders of Senior Debt (except that Holders of the
Securities may receive Permitted Junior Securities and payments made from the
trust described in Article Eight hereof).
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Issuer of any kind or character, whether in cash,
property or securities, shall be received by any Holder when such payment or
distribution is
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prohibited by Section 10.03(a), such payment or distribution shall be held for
the benefit of, and shall be paid over or delivered to, the holders of Senior
Debt (pro rata to such holders on the basis of the respective amount of Senior
Debt held by such holders) or their respective Representatives, or to the
trustee or trustees under any indenture pursuant to which any of such Senior
Debt may have been issued, as their respective interests may appear, for
application to the payment of Senior Debt remaining unpaid until all such Senior
Debt has been paid in full in cash, after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders of such Senior
Debt.
(c) To the extent any payment of Senior Debt (whether by or on behalf
of the Issuer, as proceeds of security or enforcement of any right of set-off or
otherwise) is declared to be fraudulent or preferential, set aside or required
to be paid to any receiver, trustee in bankruptcy, liquidating trustee, agent or
other similar Person under any bankruptcy, insolvency, receivership, fraudulent
conveyance or similar law, then, if such payment is recovered by, or paid over
to, such receiver, trustee in bankruptcy, liquidating trustee, agent or other
similar Person, the Senior Debt or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if such payment
had not occurred.
(d) The consolidation of the Issuer with, or the merger of the Issuer
with or into, another corporation or the liquidation or dissolution of the
Issuer following the conveyance or transfer of all or substantially all of its
assets to another corporation upon the terms and conditions provided in Article
Five and as long as permitted under the terms of the Designated Senior Debt
shall not be deemed a dissolution, winding-up, liquidation or reorganization for
the purposes of this Section 10.03 if such other corporation shall, as a part of
such consolidation, merger, conveyance or transfer, assume the Issuer's
obligations hereunder in accordance with Article Five.
SECTION 10.04. Payments May Be Paid Prior to Dissolution.
Subject to Sections 10.02(b) and 10.03(b), nothing contained in this
Article Ten or elsewhere in this Indenture shall prevent (i) the Issuer, except
under the conditions described in Sections 10.02 and 10.03, from making payments
at any time for the purpose of making payments of principal of and interest on
the Securities, or from depositing with the Trustee any moneys for such
payments, or (ii) in the absence of actual knowledge by the Trustee that a given
payment would be prohibited by Section 10.02 or 10.03, the application by the
Trustee of any moneys deposited with it for the purpose of making such payments
of principal of, and interest on, the Securities to the Holders entitled thereto
unless at least two Business Days prior to the date upon which such payment
would
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otherwise become due and payable, the Trustee shall have actually received the
written notice provided for in clause (ii) of the first sentence of Section
10.02(a) or in Section 10.07. The Issuer shall give prompt written notice to the
Trustee of any dissolution, winding-up, liquidation or reorganization of the
Issuer.
SECTION 10.05. Subrogation.
Subject to the payment in full in cash of all Senior Debt, the Holders
of the Securities shall be subrogated to the rights of the holders of Senior
Debt to receive payments or distributions of cash, property or securities of the
Issuer applicable to the Senior Debt until the Senior Debt shall be paid in
full; and, for the purposes of such subrogation, no such payments or
distributions to the holders of the Senior Debt by or on behalf of the Issuer or
by or on behalf of the Holders by virtue of this Article Ten which otherwise
would have been made to the Holders shall, as between the Issuer and the Holders
of the Securities, be deemed to be a payment by the Issuer to or on account of
the Senior Debt, it being understood that the provisions of this Article Ten are
and are intended solely for the purpose of defining the relative rights of the
Holders of the Securities, on the one hand, and the holders of the Senior Debt,
on the other hand.
SECTION 10.06. Obligations of the Issuer Unconditional.
Nothing contained in this Article Ten or elsewhere in this Indenture
or in the Securities is intended to or shall impair, as among the Issuer, its
creditors other than the holders of Senior Debt, and the Holders of the
Securities, the obligation of the Issuer, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of and any interest on the
Securities as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the
Holders of the Securities and creditors of the Issuer other than the holders of
the Senior Debt, nor shall anything herein or therein prevent the Holder of any
Security or the Trustee on its behalf from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, of the holders of Senior Debt in respect of cash, property or
securities of the Issuer received upon the exercise of any such remedy.
SECTION 10.07. Notice to Trustee.
The Issuer shall give prompt written notice to the Trustee of any fact
known to the Issuer which would prohibit the making of any payment to or by the
Trustee in respect of the Securities pursuant to the provisions of this Article
Ten.
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Regardless of anything to the contrary contained in this Article Ten or
elsewhere in this Indenture, the Trustee shall not be charged with knowledge of
the existence of any default or event of default with respect to any Senior Debt
or of any other facts which would prohibit the making of any payment to or by
the Trustee unless and until the Trust Officer of the Trustee shall have
received notice in writing from the Issuer, or from a holder of Senior Debt or a
Representative therefor, and, prior to the receipt of any such written notice,
the Trustee shall be entitled to assume (in the absence of actual knowledge to
the contrary) that no such facts exist; provided, however, that if a Trust
Officer of the Trustee shall not have received, at least two Business Days prior
to the date upon which by the terms hereof any such money may become payable for
any purpose, the notice with respect to such money provided for in this Section
10.07, then, anything herein contained to the contrary notwithstanding, but
otherwise subject to the provisions of Sections 10.02(b) and 10.03(b), 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 two
Business Days prior to such date.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself or itself to be a holder of
Senior Debt (or a trustee or agent on behalf of such holder) to establish that
such notice has been given by a holder of Senior Debt (or a trustee or agent on
behalf of any such holder). In the event that the Trustee determines in good
faith that any evidence is required with respect to the right of any Person as a
holder of Senior Debt to participate in any payment or distribution pursuant to
this Article Ten, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amounts of Senior Debt held by
such Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Ten, and if such evidence is not furnished the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
SECTION 10.08. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Issuer referred to
in this Article Ten, the Trustee, subject to the provisions of Article Seven,
and the Holders of the Securities shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which bankruptcy,
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or upon a certificate of the receiver, trustee in bankruptcy,
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liquidating trustee, agent or other person making such payment or distribution,
delivered to the Trustee or the Holders of the Securities, for the purpose of
ascertaining the Persons entitled to participate in such distribution, the
holders of the Senior Debt and other Debt of the Issuer, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article Ten.
SECTION 10.09. Trustee's Relation to Senior Debt.
The Trustee, any Agent and any agent of the Issuer, the Trustee or any
Agent shall be entitled to all the rights set forth in this Article Ten with
respect to any Senior Debt which may at any time be held by it in its individual
or any other capacity to the same extent as any other holder of Senior Debt and
nothing in this Indenture shall deprive the Trustee or any such agent of any of
its rights as such holder.
Nothing in this Article Ten shall apply to claims of, or payments to,
the Trustee in its capacity as such under or pursuant to Section 6.09 or to the
Trustee or any Agent in its capacity as such under or pursuant to Section 7.07.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its duties, covenants, responsibilities and
obligations as are specifically set forth in this Article Ten, and no implied
duties, covenants, responsibilities or obligations with respect to the holders
of Senior Debt shall be read into this Indenture against the Trustee. The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Debt and shall not be liable to any such holders if the Trustee shall in good
faith mistakenly pay over or distribute to Holders of Securities or to the
Issuer or to any other Person cash, property or securities to which any holders
of Senior Debt shall be entitled by virtue of this Article Ten or otherwise.
Whenever a distribution is to be made or a notice given to holders or
owners of Senior Debt, the distribution may be made and the notice may be given
to their Representative, if any.
SECTION 10.10. Subordination Rights Not Impaired by Acts or Omissions of the
Issuer or Holders of Senior Debt.
No right of any present or future holders of any Senior Debt to
enforce subordination as provided herein shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Issuer or
by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Issuer
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with the terms of this Indenture, regardless of any knowledge thereof which any
such holder may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee, without incurring responsibility to the
Trustee or the Holders of the Securities and without impairing or releasing the
subordination provided in this Article Ten or the obligations hereunder of the
Holders of the Securities to the holders of the Senior Debt, do any one or more
of the following: (i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt, or otherwise amend or
supplement in any manner Senior Debt, or any instrument evidencing the same or
any agreement under which Senior Debt is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (iii) release any Person liable in any manner for the
payment or collection of Senior Debt; and (iv) exercise or refrain from
exercising any rights against the Issuer and any other Person.
SECTION 10.11. Securityholders Authorize Trustee To Effectuate Subordination
of Securities.
Each Holder of Securities by its acceptance of such Security
authorizes and expressly directs the Trustee on such Holder's behalf to take
such action as may be necessary or appropriate to effectuate, as between the
holders of Senior Debt and the Holders of Securities, the subordination provided
in this Article Ten, and appoints the Trustee such Holder's attorney-in-fact to
act for and on behalf of each such Holder of Securities for such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of the Issuer (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
creditors or otherwise) tending towards liquidation of the business and assets
of the Issuer, the filing of a claim for the unpaid balance of its Securities
and accrued interest in the form required in those proceedings.
If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of Senior Debt or their
Representative are or is hereby authorized to have the right to file and are or
is hereby authorized to file an appropriate claim for and on behalf of the
Holders of said Securities. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Senior Debt or their Representative to
authorize or consent to or accept or adopt
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on behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof, or to
authorize the Trustee or the holders of Senior Debt or their Representative to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 10.12. This Article Ten Not To Prevent Events of Default.
The failure to make a payment on account of principal of or interest
on the Securities by reason of any provision of this Article Ten will not be
construed as preventing the occurrence of an Event of Default.
ARTICLE ELEVEN
GUARANTEES OF THE SECURITIES
SECTION 11.01. Guarantees.
Subject to the provisions of this Article Eleven, each Guarantor
hereby jointly and severally unconditionally guarantees to each Holder of a
Security authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of this
Indenture, the Securities or the obligations of the Issuer or any of the other
Guarantors to the Holders or the Trustee hereunder or thereunder, that: (a) the
principal of and interest on the Securities will be duly and punctually paid in
full when due, whether at maturity, by acceleration or otherwise, and interest
on the overdue principal and (to the extent permitted by law) interest, if any,
on the Securities and all other Obligations on the Securities will be promptly
paid in full or performed, all in accordance with the terms hereof and thereof;
and (b) in case of any extension of time of payment or renewal of any Securities
or any of such other Obligations on the Securities, the same will be promptly
paid in full when due or performed in accordance with the terms of the extension
or renewal, whether at final stated maturity, by acceleration or otherwise.
Failing payment when due of any amount so guaranteed, for whatever reason, each
Guarantor will be obligated to pay the same immediately. An Event of Default
under this Indenture or the Securities shall constitute an event of default
under the Guarantees, and shall entitle the Holders of Securities to accelerate
the obligations of the Guarantors hereunder in the same manner and to the same
extent as the Obligations of the Issuer on the Securities.
Each of the Guarantors hereby agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities or this Indenture,
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the absence of any action to enforce the same, any waiver or consent by any
holder of the Securities with respect to any provisions hereof or thereof, any
release of any other Guarantor, the recovery of any judgment against the Issuer,
any action to enforce the same, whether or not a Guarantee is affixed to any
particular Security, or any other circumstance (other than payment) which might
otherwise constitute a legal or equitable discharge or defense of a Guarantor.
Each of the Guarantors hereby waives the benefit of diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Issuer, any right to require a proceeding first against the
Issuer, protest, notice and all demands whatsoever and covenants that its
Guarantee will not be discharged except by complete performance of the
obligations contained in the Securities, this Indenture and the Guarantees. If
any Holder or the Trustee is required by any court or otherwise to return to the
Issuer or to any Guarantor, or any custodian, trustee, liquidator or other
similar official acting in relation to the Issuer or such Guarantor, any amount
paid by the Issuer or such Guarantor to the Trustee or such Holder, the
Guarantees, to the extent theretofore discharged, shall be reinstated in full
force and effect. Each Guarantor further agrees that, as between it, on the one
hand, and the Holders of Securities and the Trustee, on the other hand, (a)
subject to this Article Eleven, the maturity of the obligations guaranteed
hereby may be accelerated as provided in Section 6.02 for the purposes of the
Guarantees, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and (b) in
the event of any acceleration of such obligations as provided in Section 6.02,
such obligations (whether or not due and payable) shall forthwith become due and
payable by the Guarantors for the purpose of the Guarantees.
The Guarantees shall remain in full force and effect and continue to
be effective should any petition be filed by or against the Issuer for
liquidation or reorganization, should the Issuer become insolvent or make an
assignment for the benefit of creditors or should a receiver or trustee be
appointed for all or any significant part of the Issuer's assets, and shall, to
the fullest extent permitted by law, continue to be effective or be reinstated,
as the case may be, if at any time payment and performance of the Securities
are, pursuant to applicable law, rescinded or reduced in amount, or must
otherwise be restored or returned by any obligee on the Securities, whether as a
"voidable preference," "fraudulent transfer" or otherwise, all as though such
payment or performance had not been made. In the event that any payment, or any
part thereof, is rescinded, reduced, restored or returned, the Securities shall,
to the fullest extent permitted by law, be reinstated and deemed reduced only by
such amount paid and not so rescinded, reduced, restored or returned.
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No stockholder, officer, director, employee or incorporator, past,
present or future, of any Guarantor, as such, shall have any personal liability
under the Guarantees by reason of his, her or its status as such stockholder,
officer, director, employee or incorporator.
The Guarantors shall have the right to seek contribution from the
Issuer and any non-paying Guarantor so long as the exercise of such right does
not impair the rights of the Holders under the Guarantees.
Each Guarantor, and by its acceptance hereof each Holder, hereby
confirms that it is the intention of all such parties that in no event shall any
Guarantor's obligations under its Guarantee be subject to avoidance under any
applicable fraudulent conveyance or similar law of any relevant jurisdiction.
Therefore, in the event that the Guarantees would, but for this sentence, be
subject to avoidance, then the liability of the Guarantors under the Guarantees
shall be reduced to the extent necessary such that such Guarantees shall not be
subject to avoidance under the applicable fraudulent conveyance or similar law.
Subject to the preceding limitation on liability, the Guarantee of each
Guarantor constitutes a guarantee of payment in full when due and not merely a
guarantee of collectability.
SECTION 11.02. Execution and Delivery of the Guarantees.
If an Officer of a Guarantor whose signature is on this Indenture no
longer holds that office at any time hereafter, such Guarantor's Guarantee of
such Security shall be valid nevertheless.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantees set forth in
this Indenture on behalf of the Guarantors.
SECTION 11.03. Additional Guarantors.
If the Issuer or any of its Subsidiaries transfers or causes to be
transferred, in one transaction or a series of related transactions, any
property to any Restricted Domestic Subsidiary that is not a Guarantor, or if
the Issuer or any of its Subsidiaries shall organize, acquire or otherwise
invest in another Restricted Domestic Subsidiary that is not a Guarantor having
total assets with a book value in excess of $500,000, then such transferee or
acquired or other Restricted Domestic Subsidiary shall (i) execute and deliver
to the Trustee a supplemental indenture in form reasonably satisfactory to the
Trustee pursuant to which such Restricted Domestic Subsidiary shall
unconditionally guarantee all of the Issuer's obligations under the Securities
and
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this Indenture on the terms set forth in this Indenture and (ii) deliver to the
Trustee an Opinion of Counsel that such supplemental indenture has been duly
authorized, executed and delivered by such Restricted Domestic Subsidiary and
constitutes a legal, valid, binding and enforceable obligation of such
Restricted Domestic Subsidiary. Thereafter, such Restricted Domestic Subsidiary
shall be a Guarantor for all purposes of this Indenture.
SECTION 11.04. Limitation of Guarantors' Liability.
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 (other than liabilities of such Guarantor under Debt which constitutes
Guarantor Subordinated Debt with respect to its Guarantee) 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 Section 11.06, result in the obligations of such
Guarantor under such 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 11.05. Release from Guarantee.
(a) Upon the release of any Guarantee in connection with a merger or
consolidation in accordance with Article Five hereof, the Trustee shall, at the
Issuer's expense, deliver an appropriate instrument evidencing such release upon
receipt of a request by the Issuer accompanied by an Officers' Certificate
certifying as to the compliance with such provisions. Any Guarantor not so
released remains liable for the full amount of principal of, premium, if any,
and interest on the Securities as provided in this Article Eleven.
(b) Upon (i) the release by the lenders under the Senior Credit
Facility, related documents and future refinancings thereof of all guarantees of
a Guarantor and all Liens on the property and assets of such Guarantor relating
to such Debt, (ii) the circumstances described in Section 4.18, (iii) the sale
or disposition (whether by merger, stock purchase, asset sale or otherwise) of a
Guarantor (or substantially all of its assets) to an entity which is not a
Restricted Domestic Subsidiary of the Issuer (which sale or disposition is
otherwise in compliance with this Indenture) or (iv) in connection with the
defeasance of the Securities upon compliance with the conditions set forth in
Article 8 hereof, such Guarantor shall be deemed released from all of its
obligations under its Guarantee; provided, however, that any such
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termination shall occur only to the extent that all obligations of such
Guarantor under the Senior Credit Facility and all of its guarantees of, and
under all of its pledges of assets or other security interests which secure,
such Debt of the Issuer shall also terminate upon such release, sale or
transfer.
SECTION 11.06. Contribution.
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the event any payment or
distribution is made by any Guarantor (a "Funding Guarantor") under its
Guarantee, such Funding Guarantor shall be entitled, so long as the exercise of
such right does not impair the rights of the Holders under the Guarantees, to a
contribution from all other Guarantors in a pro rata amount based on the
Adjusted Net Assets of each Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by that Funding Guarantor in discharging
the Issuer's obligations with respect to the Securities or any other Guarantor's
obligations with respect to the Guarantees; provided that such Funding
Guarantor's contribution right with respect to any such Guarantor shall be
subordinated in right of payment to such Guarantor's Guarantor Senior Debt on
the same basis as its Guarantee is subordinated to Guarantor Senior Debt
pursuant to Article Twelve.
SECTION 11.07. Waiver of Subrogation.
Each Guarantor hereby irrevocably waives any claim or other rights
which it may now or hereafter acquire against the Issuer that arise from the
existence, payment, performance or enforcement of such Guarantor's obligations
under the Guarantees and this Indenture, including, without limitation, any
right of subrogation, reimbursement, exoneration, indemnification, and any right
to participate in any claim or remedy of any Holder of Securities against the
Issuer, whether or not such claim, remedy or right arises in equity, or under
contract, statute or common law, including, without limitation, the right to
take or receive from the Issuer, directly or indirectly, in cash or other
property or by set-off or in any other manner, payment or security on account of
such claim or other rights until payment in full of the Securities. If any
amount shall be paid to any Guarantor in violation of the preceding sentence and
the Securities shall not have been paid in full, such amount shall have been
deemed to have been paid to such Guarantor for the benefit of, and held in trust
for the benefit of, the Holders of the Securities, and shall, subject to the
provisions of Article Twelve, forthwith be paid to the Trustee for the benefit
of such Holders to be credited and applied upon the Securities, whether matured
or unmatured, in accordance with the terms of this Indenture. Each Guarantor
acknowledges that it will receive direct or indirect benefits from the financing
arrangements contemplated
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by this Indenture and that the waiver set forth in this Section 11.07 is
knowingly made in contemplation of such benefits.
ARTICLE TWELVE
SUBORDINATION OF GUARANTEES
SECTION 12.01. Guarantee Obligations Subordinated to Guarantor Senior Debt.
Each Guarantor covenants and agrees and the Trustee and each Holder of
the Securities, by its acceptance thereof, likewise covenants and agrees, that
all Guarantees shall be issued subject to the provisions of this Article Twelve;
and the Trustee and each Person holding any Guarantee, whether upon original
issue or upon transfer, assignment or exchange thereof, accepts and agrees that
the payment of all Obligations on the Securities pursuant to the Guarantees made
by or on behalf of any Guarantor shall, to the extent and in the manner herein
set forth, be subordinated and junior in right of payment to the prior payment
in full in cash of all existing and future Obligations on the Guarantor Senior
Debt of such Guarantor; that the subordination is for the benefit of, and shall
be enforceable directly by, the holders of Guarantor Senior Debt of such
Guarantor, and that each holder of Guarantor Senior Debt of such Guarantor
whether now outstanding or hereafter created, incurred, assumed or guaranteed
shall be deemed to have acquired Guarantor Senior Debt of such Guarantor in
reliance upon the covenants and provisions contained in this Indenture and the
Guarantees.
This Section 12.01 and the following Sections 12.02 through and
including 12.15 of this Article Twelve shall constitute a continuing offer to
all Persons who, in reliance upon such provisions, become holders of, or
continue to hold Guarantor Senior Debt of any Guarantor and, to the extent set
forth in Section 12.02, holders of Designated Senior Debt; and such provisions
are made for the benefit of the holders of Guarantor Senior Debt of each
Guarantor and, to the extent set forth in Section 12.02, holders of Designated
Senior Debt; and such holders (to such extent) are made obligees hereunder and
they or each of them may enforce such provisions.
SECTION 12.02. No Payment on Guarantees in Certain Circumstances.
(a) No payment of any kind or character shall be made by or on behalf
of any Guarantor or any other Person on behalf of such Guarantor with respect to
any Obligations of such Guarantor on the Securities or under the Guarantee of
the Securities of such
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Guarantor or to acquire any of the Securities for cash or property or otherwise
if (i) any default occurs and is continuing in the payment when due, whether at
maturity, upon any redemption, by declaration or otherwise, of any principal of,
premium, if any, interest on, unpaid drawings for letters of credit issued in
respect of, or regularly accruing fees with respect to, Guarantor Senior Debt of
any Guarantor, or (ii) any other event of default occurs and is continuing with
respect to Designated Senior Debt of any Guarantor, as such event of default is
defined in the instrument creating or evidencing such Designated Senior Debt,
permitting the holders of such Designated Senior Debt then outstanding to
accelerate the maturity thereof and, in the case of this clause (ii), the
Trustee receives a notice of such event of default (a "Guarantor Default
Notice") from the Representative for the respective issue of Designated Senior
Debt. Payments may and shall be resumed with respect to any Obligations of such
Guarantor on the Securities or under the Guarantee of such Guarantor in respect
of the Securities or with respect to the acquisition of any of the Securities
for cash or property or otherwise (x) in the case of a payment default described
in clause (i) above, upon the date on which such default is cured or waived and
(y) in the case of a default described in clause (ii) above, the earlier of (a)
the date on which all such events of default have been cured or waived, (b) 179
days after the date on which the applicable Guarantor Default Notice is
received, (c) the date such Designated Senior Debt shall have been paid in full
in cash or (d) the date such Guarantor Blockage Period shall have been
terminated by written notice to the Trustee from the Representative of the
Designated Senior Debt initiating such Guarantor Blockage Period, after which,
in the case of clauses (a), (b), (c) and (d), such Guarantor shall resume making
any and all required payments in respect of the Securities, including any
payments not made to the Holders of the Securities during the Guarantor Blockage
Period due to the foregoing prohibitions, unless the provisions described in
clause (i) above or the provisions of Section 12.03 are then applicable. No new
Guarantor Blockage Period may be commenced unless and until 360 days have
elapsed since the effectiveness of the immediately prior Guarantor Blockage
Period. No event of default which existed or was continuing on the date of
delivery of any Guarantor Default Notice with respect to the Designated Senior
Debt shall be, or be made, the basis of a subsequent Guarantor Default Notice by
the Representative of such Designated Senior Debt, unless such event of default
shall have been cured or waived for a period of not less than 90 consecutive
days (it being acknowledged that any subsequent action, or any breach of any
financial covenants for a period commencing after the date of commencement of
such Guarantor Blockage Period that, in either case, would give rise to an event
of default pursuant to any provision under which an event of default previously
existed or was continuing shall constitute a new event of default for this
purpose).
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(b) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder of a Guarantee when such payment
is prohibited by Section 12.02(a), such payment shall be held for the benefit
of, and shall be paid over or delivered to, the holders of such Guarantor Senior
Debt (pro rata to such holders on the basis of the respective amount of such
Guarantor Senior Debt held by such holders) or their respective Representatives,
as their respective interests may appear. The Trustee shall be entitled to rely
on information regarding amounts then due and owing on such Guarantor Senior
Debt, if any, received from the holders of such Guarantor Senior Debt (or their
Representatives) or, if such information is not received from such holders or
their Representatives, from the Issuer or the Guarantors and only amounts
included in the information provided to the Trustee shall be paid to the holders
of such Guarantor Senior Debt.
(c) Nothing contained in this Article Twelve shall limit the right of
the Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Section 6.02 or to pursue any rights or
remedies hereunder; provided that all Guarantor Senior Debt thereafter due or
declared to be due shall first be paid in full in cash before the Holders are
entitled to receive any payment with respect to Obligations on the Guarantees.
SECTION 12.03. Payment Over of Proceeds Upon Dissolution, etc.
(a) Upon any payment or distribution of assets of any Guarantor of any
kind or character, whether in cash, property or securities, to creditors upon
any liquidation, dissolution, winding-up, reorganization, assignment for the
benefit of creditors or marshalling of assets of any Guarantor or in a
bankruptcy, reorganization, insolvency, receivership or other similar proceeding
relating to any Guarantor or its property, whether voluntary or involuntary, all
Obligations due or to become due upon all Guarantor Senior Debt of such
Guarantor (including interest accruing after the commencement of any such
proceeding at the rate specified in the applicable Guarantor Senior Debt whether
or not such interest is an allowed claim in any such proceeding) shall first be
paid in full in cash before any payment or distribution of any kind or character
is made on account of any Obligations of such Guarantor on its Guarantee, or for
the acquisition of any of the Securities for cash or property or otherwise
(except that Holders of the Securities may receive Permitted Junior Securities
and payments made from the trust described in Article Eight hereof). Upon any
such dissolution, winding-up, liquidation, reorganization, receivership or
similar proceeding, any payment or distribution of assets of any Guarantor of
any kind or character, whether in cash, property or securities, to which the
Holders of the Guarantees or the Trustee under this Indenture would be entitled,
except for the
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provisions hereof, shall be paid by such Guarantor or by any receiver, trustee
in bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the Holders of the Guarantees or by the Trustee under this
Indenture if received by them, directly to the holders of Guarantor Senior Debt
of such Guarantor (pro rata to such holders on the basis of the respective
amounts of such Guarantor Senior Debt held by such holders) or their respective
Representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Guarantor Senior Debt may have been issued, as their
respective interests may appear, for application to the payment of such
Guarantor Senior Debt remaining unpaid until all such Guarantor Senior Debt has
been paid in full in cash after giving effect to any concurrent payment,
distribution or provision therefor to or for the holders of such Guarantor
Senior Debt (except that Holders of the Securities may receive Permitted Junior
Securities and payments made from the trust described in Article Eight hereof).
(b) In the event that, notwithstanding the foregoing, any payment or
distribution of assets of any Guarantor of any kind or character, whether in
cash, property or securities, shall be received by any Holder when such payment
or distribution is prohibited by Section 12.03(a), such payment or distribution
shall be held for the benefit of, and shall be paid over or delivered to, the
holders of Guarantor Senior Debt of such Guarantor (pro rata to such holders on
the basis of the respective amount of such Guarantor Senior Debt held by such
holders) or their respective Representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Guarantor Senior Debt may have
been issued, as their respective interests may appear, for application to the
payment of such Guarantor Senior Debt remaining unpaid until all such Guarantor
Senior Debt has been paid in full in cash, after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders of such
Guarantor Senior Debt.
(c) To the extent any payment of Guarantor Senior Debt (whether by or
on behalf of any Guarantor, as proceeds of security or enforcement of any right
of set-off or otherwise) is declared to be fraudulent or preferential, set aside
or required to be paid to any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then, if such payment is
recovered by, or paid over to, such receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person, the Guarantor Senior Debt or part
thereof originally intended to be satisfied shall be deemed to be reinstated and
outstanding as if such payment had not occurred.
(d) The consolidation of any Guarantor with, or the merger of any
Guarantor with or into, another corporation or the
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liquidation or dissolution of any Guarantor following the conveyance or transfer
of all or substantially all of its assets, to another corporation which complies
with the terms and conditions provided in Article Five hereof and which does not
violate any other Obligation of such Guarantor under this Indenture or Guarantee
of such Guarantor and as long as permitted under the terms of the Designated
Senior Debt of such Guarantor shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section 12.03 if such
other corporation shall, as a part of such consolidation, merger, conveyance or
transfer, assume such Guarantor's obligations hereunder in accordance with
Article Five hereof.
SECTION 12.04. Payments May Be Paid Prior to Dissolution.
Subject to Sections 12.02(b) and 12.03(b), nothing contained in this
Article Twelve or elsewhere in this Indenture shall prevent (i) a Guarantor,
except under the conditions described in Sections 12.02 and 12.03, from making
payments at any time for the purpose of making payments of principal of and
interest on the Securities, or from depositing with the Trustee any moneys for
such payments, or (ii) in the absence of actual knowledge by the Trustee that a
given payment would be prohibited by Section 12.02 and 12.03, the application by
the Trustee of any moneys deposited with it for the purpose of making such
payments of principal of, and interest on, the Securities to the Holders
entitled thereto unless at least two Business Days prior to the date upon which
such payment would otherwise become due and payable, the Trustee shall have
actually received the written notice provided for in the second sentence of
Section 12.02(a) or in Section 12.09. A Guarantor shall give prompt written
notice to the Trustee of any dissolution, winding-up, liquidation or
reorganization of such Guarantor.
SECTION 12.05. Subrogation.
Subject to the payment in full in cash of all Guarantor Senior Debt of
a Guarantor, the Holders of the Guarantees shall be subrogated to the rights of
the holders of such Guarantor Senior Debt to receive payments or distributions
of cash, property or securities of such Guarantor applicable to the Guarantor
Senior Debt of a Guarantor until the Securities shall be paid in full; and, for
the purposes of such subrogation, no such payments or distributions to the
holders of such Guarantor Senior Debt by or on behalf of such Guarantor or by or
on behalf of the Holders of the Guarantees by virtue of this Article Twelve
which otherwise would have been made to such Holders of the Guarantees shall, as
between such Guarantor and the Holders of the Guarantees, be deemed to be a
payment by such Guarantor to or on account of the Guarantor Senior Debt of a
Guarantor.
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SECTION 12.06. Guarantee Provisions Solely To Define Relative Rights.
The subordination provisions of this Article Twelve are and are
intended solely for the purpose of defining the relative rights of the Holders
of the Securities on the one hand and the holders of Guarantor Senior Debt of
each Guarantor and, to the extent set forth in Section 12.02, holders of
Designated Senior Debt of each Guarantor, on the other hand. Nothing contained
in this Article Twelve or elsewhere in this Indenture or in the Securities is
intended to or shall (a) impair, as among any Guarantor, its creditors other
than holders of its Guarantor Senior Debt and the Holders of the Securities, the
obligation of such Guarantor, which is absolute and unconditional, to make
payments to the Holders in respect of its obligations under its Guarantee as and
when the same shall become due and payable in accordance with their terms; or
(b) affect the relative rights against such Guarantor of the Holders of the
Securities and creditors of such Guarantor other than the holders of the
Guarantor Senior Debt of such Guarantor; or (c) prevent the Trustee or the
Holder of any Security 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 the subordination provisions of this
Article Twelve of the holders of Guarantor Senior Debt of such Guarantor
hereunder and, to the extent set forth in Section 12.02, holders of Designated
Senior Debt of such Guarantor (1) in any case, proceeding, dissolution,
liquidation or other winding-up, assignment for the benefit of creditors or
other marshalling of assets and liabilities of such Guarantor referred to in
Section 12.03, 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 12.02, to prevent
any payment prohibited by such Section or enforce their rights pursuant to
Section 12.02(c).
The failure by any Guarantor to make a payment in respect of its
obligations under its Guarantee by reason of any provision of this Article
Twelve shall not be construed as preventing the occurrence of a Default or an
Event of Default hereunder.
SECTION 12.07. Trustee To Effectuate Subordination of Obligations Under the
Guarantees.
Each Holder of a Security by its acceptance of such Security
authorizes and expressly directs the Trustee to take on behalf of such Holder of
Securities such action as may be necessary or appropriate to effectuate as
between the holders of Guarantor Senior Debt and Holders of Securities, the
subordination provided in this Article Twelve, and appoints the Trustee its
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attorney-in-fact to act for it and on its behalf for such purposes, including,
in the event of any dissolution, winding-up, liquidation or reorganization of
any Guarantor (whether in bankruptcy, insolvency, receivership, reorganization
or similar proceedings or upon an assignment for the benefit of creditors or,
otherwise) tending towards liquidation of the business and assets of such
Guarantor, the filing of a claim for the unpaid balance of its Guarantee and
accrued interest in the form required in those proceedings.
If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of the Guarantor Senior Debt
or their Representative are or is hereby authorized to have the right to file
and are or is hereby authorized to file an appropriate claim for and on behalf
of the Holders of said Securities. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Guarantor Senior Debt or their
Representative to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof, or to authorize
the Trustee or the holders of Guarantor Senior Debt or their Representative to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 12.08. No Waiver of Guarantee Subordination Provisions.
No right of any present or future holder of any Guarantor Senior Debt
of any Guarantor to enforce subordination as provided herein shall at any time
in any way be prejudiced or impaired by any act or failure to act on the part of
the Issuer or such Guarantor or by any act or failure to act, in good faith, by
any such holder, or by any non-compliance by the Issuer or such Guarantor with
the terms of this Indenture, regardless of any knowledge thereof any such holder
may have or otherwise be charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Guarantor Senior Debt of any Guarantor may, at any time and from
time to time, without the consent of or notice to the Trustee, without incurring
responsibility to the Trustee or the Holders of the Securities and without
impairing or releasing the subordination provided in this Article Twelve or the
obligations hereunder of the Holders of the Guarantees to the holders of such
Guarantor Senior Debt, 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, such Guarantor Senior Debt or any Senior Debt as to which such Guarantor
Senior Debt relates, or otherwise amend or supplement in any manner
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such Guarantor Senior Debt or any Senior Debt to which such Guarantor Senior
Debt relates; (2) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing such Guarantor Senior Debt or any
Senior Debt as to which such Guarantor Senior Debt relates; (3) release any
person liable in any manner for the collection or payment of such Guarantor
Senior Debt or any Senior Debt as to which such Guarantor Senior Debt relates;
and (4) exercise or refrain from exercising any rights against such Guarantor
and any other Person.
SECTION 12.09. Guarantors To Give Notice to Trustee.
The Issuer and each Guarantor shall give prompt written notice to the
Trustee of any fact known to the Issuer or such Guarantor which would prohibit
the making of any payment to or by the Trustee in respect of the Securities
pursuant to the provisions of this Article Twelve. Notwithstanding the
subordination provisions of this Article Twelve or any other provision of this
Indenture, the Trustee shall not be charged with knowledge of the existence of
any default or event of default with respect to any Guarantor Senior Debt or of
any other facts which would prohibit the making of any payment to or by the
Trustee unless and until the Trustee shall have received notice in writing from
the Issuer, such Guarantor or from a holder of Guarantor Senior Debt or a
Representative therefor, and, prior to the receipt of any such written notice,
the Trustee shall be entitled to assume (in the absence of actual knowledge to
the contrary) that no such facts exist; provided, however, that if a Trust
Officer of the Trustee shall not have received, at least two Business Days prior
to the date upon which by the terms hereof any such money may become payable for
any purpose, the notice with respect to such money provided for in this Section
12.09, then, anything herein contained to the contrary notwithstanding, but
otherwise subject to the provisions of Sections 12.02(b) and 12.03(b), 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 two
Business Days prior to such date.
The Trustee shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself or itself to be a holder of
Guarantor Senior Debt (or a trustee or agent on behalf of such holder) to
establish that such notice has been given by a holder of Guarantor Senior Debt
(or a trustee or agent on behalf of any such holder). In the event that the
Trustee determines in good faith that any evidence is required with respect to
the right of any Person as a holder of Guarantor Senior Debt of any Guarantor to
participate in any payment or distribution pursuant to this Article Twelve, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the
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Trustee as to the amount of Guarantor Senior Debt of such Guarantor held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Twelve, and if such evidence is not furnished the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
SECTION 12.10. Reliance on Judicial Order or Certificate of Liquidating Agent
Regarding Dissolution, etc., of Guarantors.
Upon any payment or distribution of assets of a Guarantor referred to
in this Article Twelve, the Trustee, subject to the provisions of Article Seven,
and the Holders shall be entitled to rely upon any order or decree entered by
any court of competent jurisdiction in which such bankruptcy, liquidation or
reorganization, dissolution, winding-up proceedings are pending, or upon a
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other person making such payment or distribution, delivered to the Trustee or
to the Holders of the Guarantees, for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of
Guarantor Senior Debt of such Guarantor and other Debt of such Guarantor, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article Twelve.
SECTION 12.11. No Suspension of Remedies.
Nothing contained in this Article Twelve shall limit the right of the
Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Article Six or to pursue any rights or
remedies hereunder or under applicable law, subject to the rights, if any, under
this Article Twelve of the holders, from time to time, of Guarantor Senior Debt
of the Guarantors.
SECTION 12.12. Trustee's Relation to Guarantor Senior Debt.
The Trustee, any Agent and any agent of the Trustee or any Agent shall
be entitled to all the rights set forth in this Article Twelve with respect to
any Guarantor Senior Debt which may at any time be held by it in its individual
or any other capacity to the same extent as any other holder of such Guarantor
Senior Debt and nothing in this Indenture shall deprive the Trustee or any Agent
or any of their agents of any of its rights as such holder.
With respect to the holders of Guarantor Senior Debt, the Trustee and
any Agent undertake to perform or to observe only such
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of their duties, covenants, responsibilities and obligations as are specifically
set forth in this Article Twelve, and no implied covenants or obligations with
respect to the holders of Guarantor Senior Debt shall be read into this
Indenture against the Trustee or any Agent. Neither the Trustee nor any Agent
shall be deemed to owe any fiduciary or other duty to the holders of Guarantor
Senior Debt and shall not be liable to any such holders if the Trustee or any
Agent shall in good faith mistakenly pay over or distribute to Holders of
Securities or to the Issuer or to any other Person cash, property or securities
to which any holders of Senior Debt shall be entitled by virtue of this Article
Twelve or otherwise.
Whenever a distribution is to be made or a notice given to holders or
owners of Guarantor Senior Debt, the distribution may be made and the notice may
be given to their Representative, if any.
SECTION 12.13. No Subordination of Certain Claims.
Nothing within Article Twelve shall apply to claims of or payments to
the Trustee in its capacity as such under or pursuant to Section 6.09 or to the
Trustee or any Agent in its capacity as such under or pursuant to Section 7.07.
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required to be included in this Indenture by the
TIA, the required provision shall control.
SECTION 13.02. Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
by telecopier or first class mail, postage prepaid, addressed as follows:
if to the Issuer:
Communications Instruments, Inc.
1396 Charlotte Highway
Fairview, North Carolina 29730
Attention: David Henning
Facsimile: (704) 628-1439
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with a copy to:
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Sanford Perl
Facsimile: (312) 861-2200
if to the Trustee:
Norwest Bank Minnesota National Association
Norwest Center
Sixth & Marquette
Minneapolis, Minnesota 55479-0069
Attention: Corporate Trust Services
Facsimile: (612) 667-9825
The Issuer, the Guarantors and the Trustee by written notice to each
other such Person may designate additional or different addresses for notices to
such Person. Any notice or communication to the Issuer, the Guarantors or the
Trustee shall be deemed to have been given or made as of the date so delivered
if personally delivered; when receipt is acknowledged, if faxed; and five (5)
business days after mailing if sent by registered or certified mail, postage
prepaid (except that a notice of change of address shall not be deemed to have
been given until actually received by the addressee).
Any notice or communication mailed to a Holder shall be mailed to him
by first class mail or other equivalent means at his address as it appears on
the registration books of the Registrar and shall be sufficiently given to him
if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not the addressee receives it.
SECTION 13.03. Communications by Holders with Other Holders.
Holders may communicate pursuant to TIA (S) 312(b) with other Holders
with respect to their rights under this Indenture or the Securities. The
Issuer, the Guarantors, the Trustee, the Registrar and any other Person shall
have the protection of TIA (S) (S) 312(c).
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SECTION 13.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuer to the Trustee to take
any action under this Indenture, other than with respect to the authentication
of the Securities for original issuance on the Issue Date, the Issuer shall
furnish to the Trustee upon the Trustee's request:
(1) an Officers' Certificate, in form and substance reasonably
satisfactory to the Trustee, stating that, in the opinion of the signers,
all conditions precedent to be performed by the Issuer; if any, provided
for in this Indenture relating to the proposed action have been complied
with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent to be performed by the Issuer, if
any, provided for in this Indenture relating to the proposed action have
been complied with.
SECTION 13.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture, other than the Officers'
Certificate required by Section 4.06, shall include:
(1) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is reasonably necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether or not, in the opinion of each such
Person, such condition or covenant has been complied with provided, however
that with respect to matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials.
SECTION 13.06. Rules by Trustee, Paying Agent, Registrar.
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The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Holders. The Paying Agent
or Registrar may make reasonable rules for its functions.
SECTION 13.07. Legal Holidays.
A "Legal Holiday" used with respect to a particular place of payment
is a Saturday, a Sunday or a day on which banking institutions in New York, New
York or at such place of payment are not required to be open. If a payment date
is a Legal Holiday at such place, payment may be made at such place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period.
SECTION 13.08. Governing Law.
THIS INDENTURE AND THE SECURITIES 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
CONFLICT OF LAWS OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW.
SECTION 13.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Issuer or any of its Subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
SECTION 13.10. No Recourse Against Others.
A past, present or future director, officer, employee, incorporator,
stockholder or limited or general partner, as such, of the Issuer or any of its
Subsidiaries shall not have any liability for any obligations of the Issuer or
any of its Subsidiaries under the Securities or this Indenture or for any claim
based on, in respect of or by reason of such obligations or their creations.
Each Holder by accepting a Security waives and releases all such liability.
Such waiver and release are part of the consideration for the issuance of the
Securities.
SECTION 13.11. Successors.
All agreements of the Issuer in this Indenture and the Securities
shall bind its successors. All agreements of the Trustee in this Indenture
shall bind its successors.
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SECTION 13.12. Duplicate Originals.
All parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together shall represent the
same agreement.
SECTION 13.13. Severability.
In case any one or more of the provisions in this Indenture or in the
Securities shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.
[signature page follows]
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
ISSUER:
COMMUNICATIONS INSTRUCTIONS, INC., a
North Carolina corporation
By:
Name:
Title:
TRUSTEE:
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, as
Trustee
By:
Name:
Title:
GUARANTORS:
KILOVAC CORPORATION, a California
corporation
By:
Name:
Title:
KILOVAC INTERNATIONAL, INC.,
a California corporation
By:
Name:
Title:
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EXHIBIT A-1
-----------
[FORM OF SECURITY]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
FOREIGN SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR
AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
SUCH SECURITY), ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO
LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND
SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE
MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS
ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF
THE SECURITIES OF $100,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR
FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND
THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (i) PURSUANT TO
CLAUSES (C), (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND (ii) IN
THE CASE OF THE FOREGOING CLAUSE (E), TO REQUIRE THAT A TRANSFER NOTICE IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY AND THE TRUSTEE. THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.
COMMUNICATIONS INSTRUMENTS, INC.
10% SENIOR SUBORDINATED NOTE DUE 2004
CUSIP No. _______
No. $
COMMUNICATIONS INSTRUMENTS, INC., a North Carolina corporation (the
"Issuer"), for value received, promises to pay to _________________ or
registered assigns, the principal sum of _________________ Dollars, on September
15, 2004.
Interest Payment Dates: March 15 and September 15
Record Dates: March 1 and September 1
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Issuer has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
COMMUNICATIONS INSTRUMENTS, INC.,
a North Carolina corporation
By:
Name:
Title:
By:
Name:
Title:
-2-
Trustee's Certificate of Authentication
This is one of the 10% Senior Subordinated Notes due 2004 referred to
in the within-mentioned Indenture.
Dated:
NORWEST BANK MINNESOTA NATIONAL
ASSOCIATION, as Trustee
By: ___________________________, as
Authenticating Agent
By: ___________________________
Authorized Signatory
-3-
(REVERSE OF SECURITY)
10% SENIOR SUBORDINATED NOTE DUE 2004
1. Interest. COMMUNICATIONS INSTRUMENTS, INC., a North Carolina
corporation (the "Issuer"), promises to pay interest on the principal amount of
this Security at the rate per annum shown above. Interest on the Securities
will accrue from the most recent date on which interest has been paid or, if no
interest has been paid, from September 18, 1997. The Issuer will pay interest
semi-annually in arrears on each Interest Payment Date, commencing March 15,
1998. Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
The Issuer shall pay interest on overdue principal and on overdue
installments of interest from time to time in accordance with Section 2.12 of
the Indenture at the rate borne by the Securities to the extent lawful.
2. Method of Payment. The Issuer shall pay interest on the Securities
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on the record date immediately preceding the Interest Payment
Date even if the Securities are canceled on registration of transfer or
registration of exchange after such record date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Issuer shall
pay principal, premium, if any, and interest in money of the United States that
at the time of payment is legal tender for payment of public and private debts
("U.S. Legal Tender"). However, the Issuer may pay principal, premium, if any,
and interest by its check payable in such U.S. Legal Tender unless a Holder of
Securities has given wire transfer instructions in which case the Issuer will be
required to make payment of principal, premium, if any, and interest by wire
transfer of immediately available funds to the accounts specified by such
Holder. The Issuer may deliver any such payments to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, Norwest Bank Minnesota,
National Association (the "Paying Agent") will act as Paying Agent and
Registrar. The Issuer may change any Paying Agent, Registrar or co-Registrar
without notice to the Holders. The Issuer or any of its Subsidiaries may,
subject to certain exceptions, act as Registrar or co-Registrar.
4. Indenture and Guarantees. The Issuer issued the Securities under an
Indenture dated as of September 18, 1997 (the "Indenture"), among the Issuer,
Kilovac Corporation, a California corporation, Kilovac International, Inc., a
California corporation, and each of the Issuer's future Restricted Domestic
Subsidiaries,
-4-
as guarantors (the "Guarantors"), and Norwest Bank Minnesota, National
Association, as trustee (the "Trustee"). This Security is one of a duly
authorized issue of Securities of the Issuer designated as its 10% Senior
Subordinated Notes due 2004 (the "Securities"), limited (except as otherwise
provided in the Indenture) in aggregate principal amount to $125,000,000, which
may be issued under the Indenture. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until the date on which the Indenture is
qualified under TIA, then on such date. Notwithstanding anything to the
contrary herein, the Securities are subject to all such terms, and Holders of
Securities are referred to the Indenture and the TIA for a statement of them.
The Securities are general unsecured obligations of the Issuer. Payment on each
Security is guaranteed on an unsecured senior subordinated basis, jointly and
severally, by the Guarantors pursuant to Article Eleven of the Indenture. In
certain circumstances the Guarantees may be released.
5. Subordination. The Securities are subordinated in right of payment,
in the manner and to the extent set forth in the Indenture, to the prior payment
in full in cash of all Senior Debt, whether outstanding on the date of the
Indenture or thereafter created, incurred, assumed or guaranteed. To the extent
and in the manner provided in the Indenture, Senior Debt must be paid before any
payment may be made to any Holder of this Security. Each Holder by its
acceptance hereof agrees to be bound by such provisions and authorizes and
expressly directs the Trustee, on its behalf, to take such action as may be
necessary or appropriate to effectuate the subordination provided for in the
Indenture and appoints the Trustee its attorney-in-fact for such purposes.
6. Optional Redemption. (i) The Securities will be redeemable at the
option of the Issuer, in whole or in part, at any time on or after September 15,
2001, 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 12-month period beginning on September 15, of the years
indicated below:
Redemption
Year Price
---- ----------
2001........................................ 105.000%
2002........................................ 102.500%
2003 and thereafter......................... 100.000%
(ii) At any time prior to September 15, 2000, the Issuer may on any
one or more occasions redeem from the net proceeds of one or more Equity
Offerings up to an aggregate of 33.3% in aggregate principal amount of the
Securities at a redemption price
-5-
of 110.000% of the principal amount thereof, plus accrued and unpaid interest
thereon to the redemption date; provided that at least $63.4 million aggregate
principal amount of Securities remain outstanding immediately after the
occurrence of such redemption.
7. Notice of Redemption. Notice of redemption shall be mailed by
first-class mail, postage prepaid, mailed to such Holder's registered address,
at least 30 but not more than 60 days before the Redemption Date. Securities in
denominations larger than $1,000 may be redeemed in part.
8. Change of Control Offer. In the event of a Change of Control, upon
the satisfaction of the conditions set forth in the Indenture, the Issuer shall
be required to offer to repurchase all or a portion of the then outstanding
Securities pursuant to a Change of Control Offer at a purchase price equal to
101% of the principal amount thereof, plus accrued interest to the date of
repurchase. Holders of Securities which are the subject of such an offer to
repurchase shall receive an offer to repurchase and may elect to have such
Securities repurchased in accordance with the provisions of the Indenture
pursuant to and in accordance with the terms of the Indenture.
9. Limitation on Disposition of Assets. Under certain circumstances the
Issuer is required to apply the net cash proceeds from Asset Sales to offer to
repurchase Securities at a price equal to 100% of the aggregate principal amount
thereof, plus accrued interest to the date of repurchase.
10. Denominations; Transfer; Exchange. The Securities are in registered
form, without coupons, in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Securities in
accordance with the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and to pay
certain transfer taxes or similar governmental charges payable in connection
therewith as permitted by the Indenture. The Registrar or co-Registrar shall not
be required to register the transfer of or exchange of any Security (i) during a
period beginning at the opening of business 15 days before the mailing of a
notice of redemption of Securities and ending at the close of business on the
day of such mailing, (ii) selected for redemption in whole or in part pursuant
to Article Three of the Indenture, except the unredeemed portion of any Security
being redeemed in part and (iii) during a Change of Control Offer or an Asset
Sale Offer if such Security is tendered pursuant to such Change of Control Offer
or Asset Sale Offer and not withdrawn.
11. Persons Deemed Owners. The registered Holder of a Security shall be
treated as the owner of it for all purposes.
-6-
12. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for one year, the Trustee and the Paying Agent will pay the
money back to the Issuer. After that, all liability of the Trustee and such
Paying Agent with respect to such money shall cease.
13. Discharge Prior to Redemption or Maturity. If the Issuer at any time
deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and interest on the Securities to redemption
or maturity and complies with the other provisions of the Indenture relating
thereto, the Issuer will be discharged from certain provisions of the Indenture
and the Securities (including certain covenants, but excluding its obligation to
pay the principal of and interest on the Securities).
14. Amendment; Supplement; Waiver. Subject to certain exceptions, the
Indenture or the Securities may be amended or supplemented with the written
consent of the Holders of at least a majority in aggregate principal amount of
the Securities then outstanding, and any existing Default or Event of Default or
noncompliance with any provision may be waived with the written consent of the
Holders of a majority in aggregate principal amount of the Securities then
outstanding. Without notice to or consent of any Holder, the parties thereto
may amend or supplement the Indenture or the Securities to, among other things,
cure any ambiguity, defect or inconsistency, provide for uncertificated
Securities in addition to or in place of certificated Securities, provide for
the assumption of the Issuer's obligations to Holders of the Securities in the
event of any Disposition involving the Issuer in which the Issuer is not a
Surviving Person, comply with requirements of the SEC in order to effect or
maintain the qualification of the Indenture under TIA, provide for the issuance
of Exchange Securities or make any other change that does not adversely affect
in any material respect the legal rights under the Indenture of any Holder of a
Security.
15. Restrictive Covenants. The Indenture imposes certain limitations on
the ability of the Issuer and its Restricted Subsidiaries to, among other
things, incur additional Debt, make payments in respect of its Equity Interest
or certain Debt, enter into transactions with Related Persons, create dividend
or other payment restrictions affecting Restricted Subsidiaries and merge or
consolidate with any other Person, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions. The Issuer must annually report to the Trustee on
compliance with such limitations.
16. Successors. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the
-7-
Securities and the Indenture, the predecessor will be released from those
obligations.
17. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of Securities then outstanding may declare all the Securities to be due
and payable in the manner, at the time and with the effect provided in the
Indenture. Holders of Securities may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee is not obligated to
enforce the Indenture or the Securities unless it has been offered indemnity or
security reasonably satisfactory to it. The Indenture permits, subject to
certain limitations therein provided, Holders of a majority in aggregate
principal amount of the Securities then outstanding to direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of
Securities notice of any continuing Default or Event of Default (except a
Default in payment of principal or interest) if it determines in good faith that
withholding notice is in their interest.
18. Defeasance. The Indenture contains provisions (which provisions
apply to this Security) which provide that (a) the Issuer will be discharged
from any and all obligations in respect of the Securities and the Guarantors
will be released from their Guarantees and (b) the payment of the Securities may
not be accelerated upon certain Events of Default, in each case upon compliance
by the Issuer with certain conditions set forth therein.
19. Trustee Dealings with Issuer. The Trustee under the Indenture, in
its individual or any other capacity, may become the owner or pledgee of
Securities and may otherwise deal with the Issuer, Subsidiaries of the Issuer or
their respective Affiliates as if it were not the Trustee.
20. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or limited or general partner of
the Issuer or any of its Subsidiaries shall have any liability for any
obligations of the Issuer or any of its Subsidiaries under the Securities or the
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creations. Each Holder of a Security by accepting a
Security waives and releases all such liability. Such waiver and release are
part of the consideration for the issuance of the Securities.
21. Authentication. This Security shall not be valid until the Trustee
or authenticating agent manually signs the certificate of authentication on
this Security.
22. Governing Law. The laws of the State of New York shall govern this
Security and the Indenture, without regard to principles of conflict of law
other than Section 5-1401 of the New York General Obligations Law.
-8-
23. Abbreviations and Defined Terms. Customary abbreviations may be
used in the name of a Holder of a Security or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
24. CUSIP Numbers. Pursuant to a recommendation promulgated by the
committee on Uniform Security Identification Procedures, the Issuer has caused
CUSIP numbers to be printed on the Securities as a convenience to the Holders of
the Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
25. Registration Rights.
Pursuant to the Registration Rights Agreement among the Issuer, the
Guarantors and the Initial Purchasers on behalf of the Holders of the
Securities, the Issuer will be obligated to consummate an exchange offer
pursuant to which the Holder of this Security shall have the right to exchange
this Security for the Issuer's 10% Senior Subordinated Notes due 2004 (the
"Exchange Securities") which will be registered under the Securities Act, in
like principal amount and having terms identical in all material respects as the
Securities issued on the Issue Date. The Holders of the Securities shall be
entitled to receive certain additional interest payments in the event such
exchange offer is not consummated and upon certain other conditions, all
pursuant to and in accordance with the terms of such Registration Rights
Agreement. Additional interest which may be payable pursuant to the Registration
Rights Agreement shall be payable in the same manner as set forth herein with
respect to the stated interest. The provision of the Registration Rights
Agreement relating to such additional interest are incorporated herein by
reference and made a part hereof as if set forth herein in full.
26. Indenture. Each Holder, by accepting a Security, agrees to be bound
by all of the terms and provisions of the Indenture, as the same may be amended
from time to time. Capitalized terms used herein and not defined herein have the
meanings ascribed thereto in the Indenture.
The Issuer will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture, which has the text of this
Security in larger type. Requests may be made to:
Communications Instruments, Inc.
1396 Charlotte Highway
Fairview, North Carolina 29730
Attention: David Henning
-9-
ASSIGNMENT FORM
I or we assign to and transfer this Security to
________________________________________________________________________________
________________________________________________________________________________
(please print or type name and address)
________________________________________________________________________________
(insert Social Security number or other identifying number of assignee)
and irrevocably appoint _____________ agent to transfer this Security on the
books of the Issuer. The agent may substitute another to act for him.
In connection with any transfer of this Security occurring prior to the
date which is the earlier of (i) the date of the declaration by the SEC of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the "Act") covering resales of this Security (which effectiveness shall
not have been suspended or terminated at the date of the transfer) and (ii)
___________, the undersigned confirms that it has not utilized and general
solicitation or general advertising in connection with the transfer and that:
[Check One]
---------
[ ] (a) this Security is being transferred in compliance with the exemption
from registration under the Securities Act provided by Rule 144A
thereunder.
[ ] (b) this Security 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 Security and the Indenture.
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.16 of the Indenture shall have
been satisfied.
Dated: ______________ Signed: __________________________________________
(Signed exactly as name appears on
the other side of this Security)
-10-
Signature Guarantee: ___________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding 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.
Date: _____________________ ____________________________________________
NOTICE: To be executed by an executive
officer
-11-
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Issuer pursuant to
Section 4.15 or 4.16 of the Indenture, check the appropriate Box:
Section 4.15 [ ]
Section 4.16 [ ]
If you wish to have a portion of this Security purchased by the Issuer
pursuant to Section 4.15 or 4.16 of the Indenture, state the amount you wish to
have purchased:
US$_________
Date: ________________ Your Signature: _______________________________________
(Sign exactly as your name appears on
the other side of this Security)
Signature Guarantee: ___________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
-12-
EXHIBIT A-2
-----------
COMMUNICATIONS INSTRUMENTS, INC.
10% SENIOR SUBORDINATED NOTE DUE 2004
CUSIP No. _______
No. $
Communications Instruments, Inc., a North Carolina corporation (the
"Issuer"), for value received, promises to pay to _________________ or
registered assigns, the principal sum of _________________ Dollars, on September
15, 2004.
Interest Payment Dates: March 15 and September 15
Record Dates: March 1 and September 1
Reference is made to the further provisions of this Security contained
herein, which will for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, the Issuer has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
COMMUNICATIONS INSTRUMENTS, INC.,
a North Carolina corporation
By:
Name:
Title:
By:
Name:
Title:
-13-
Trustee's Certificate of Authentication
This is one of the 10% Senior Subordinated Notes due 2004 referred to
in the within-mentioned Indenture.
Dated:
NORWEST BANK MINNESOTA
NATIONAL ASSOCIATION, as Trustee
By: ____________________________, as
Authenticating Agent
By: ___________________________
Authorized Signatory
-14-
(REVERSE OF SECURITY)
10% SENIOR SUBORDINATED NOTE DUE 2004
1. Interest. COMMUNICATIONS INSTRUMENTS, INC., a North Carolina
corporation (the "Issuer"), promises to pay interest on the principal amount of
this Security at the rate per annum shown above. Interest on the Securities
will accrue from the most recent date on which interest has been paid or, if no
interest has been paid, from September 18, 1997. The Issuer will pay interest
semi-annually in arrears on each Interest Payment Date, commencing March 15,
1998. Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
The Issuer shall pay interest on overdue principal and on overdue
installments of interest from time to time in accordance with Section 2.12 of
the Indenture at the rate borne by the Securities to the extent lawful.
2. Method of Payment. The Issuer shall pay interest on the Securities
(except defaulted interest) to the Persons who are the registered Holders at the
close of business on the record date immediately preceding the Interest Payment
Date even if the Securities are canceled on registration of transfer or
registration of exchange after such record date. Holders must surrender
Securities to a Paying Agent to collect principal payments. The Issuer shall
pay principal, premium, if any, and interest in money of the United States that
at the time of payment is legal tender for payment of public and private debts
("U.S. Legal Tender"). However, the Issuer may pay principal, premium, if any,
and interest by its check payable in such U.S. Legal Tender unless a Holder of
Securities has given wire transfer instructions in which case the Issuer will be
required to make payment of principal, premium, if any, and interest by wire
transfer of immediately available funds to the accounts specified by such
Holder. The Issuer may deliver any such payments to the Paying Agent or to a
Holder at the Holder's registered address.
3. Paying Agent and Registrar. Initially, Norwest Bank Minnesota,
National Association(the "Paying Agent") will act as Paying Agent and Registrar.
The Issuer may change any Paying Agent, Registrar or co-Registrar without notice
to the Holders. The Issuer or any of its Subsidiaries may, subject to certain
exceptions, act as Registrar or co-Registrar.
4. Indenture and Guarantees. The Issuer issued the Securities under an
Indenture dated as of September 18, 1997 (the "Indenture"), among the Issuer,
Kilovac Corporation, a California corporation, Kilovac International, Inc., a
California corporation, and each of the Issuer's future Restricted Domestic
Subsidiaries,
-15-
as guarantors (the "Guarantors"), and Norwest Bank Minnesota, National
Association, as trustee (the "Trustee"). This Security is one of a duly
authorized issue of Securities of the Issuer designated as its 10% Senior
Subordinated Notes due 2004 (the "Securities"), limited (except as otherwise
provided in the Indenture) in aggregate principal amount to $125,000,000, which
may be issued under the Indenture. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. (S)(S) 77aaa-77bbbb) (the "TIA"), as in
effect on the date of the Indenture until the date on which the Indenture is
qualified under TIA, then on such date. Notwithstanding anything to the
contrary herein, the Securities are subject to all such terms, and Holders of
Securities are referred to the Indenture and the TIA for a statement of them.
The Securities are general unsecured obligations of the Issuer. Payment on each
Security is guaranteed on an unsecured senior subordinated basis, jointly and
severally, by the Guarantors pursuant to Article Eleven of the Indenture. In
certain circumstances the Guarantees may be released
5. Subordination. The Securities are subordinated in right of payment,
in the manner and to the extent set forth in the Indenture, to the prior payment
in full in cash of all Senior Debt, whether outstanding on the date of the
Indenture or thereafter created, incurred, assumed or guaranteed. To the extent
and in the manner provided in the Indenture, Senior Debt must be paid before any
payment may be made to any Holder of this Security. Each Holder by its
acceptance hereof agrees to be bound by such provisions and authorizes and
expressly directs the Trustee, on its behalf, to take such action as may be
necessary or appropriate to effectuate the subordination provided for in the
Indenture and appoints the Trustee its attorney-in-fact for such purposes.
6. Optional Redemption. (i) The Securities will be redeemable at the
option of the Issuer, in whole or in part, at any time on or after September 15,
2001, 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 12-month period beginning on September 15, of the years
indicated below:
Redemption
Year Price
---- ----------
2001............................................. 105.000%
2002............................................. 102.500%
2003 and thereafter.............................. 100.000%
(ii) At any time prior to September 15, 2000, the Issuer may on any
one or more occasions redeem from the net proceeds of one or more Equity
Offerings up to an aggregate of 33.3% in aggregate principal amount of the
Securities at a redemption price
-16-
of 110.000% of the principal amount thereof, plus accrued and unpaid interest
thereon to the redemption date; provided that at least $63.4 million aggregate
principal amount of Securities remain outstanding immediately after the
occurrence of such redemption.
7. Notice of Redemption. Notice of redemption shall be mailed by
first-class mail, postage prepaid, mailed to such Holder's registered address,
at least 30 but not more than 60 days before the Redemption Date. Securities in
denominations larger than $1,000 may be redeemed in part.
8. Change of Control Offer. In the event of a Change of Control, upon
the satisfaction of the conditions set forth in the Indenture, the Issuer shall
be required to offer to repurchase all or a portion of the then outstanding
Securities pursuant to a Change of Control Offer at a purchase price equal to
101% of the principal amount thereof, plus accrued interest to the date of
repurchase. Holders of Securities which are the subject of such an offer to
repurchase shall receive an offer to repurchase and may elect to have such
Securities repurchased in accordance with the provisions of the Indenture
pursuant to and in accordance with the terms of the Indenture.
9. Limitation on Disposition of Assets. Under certain circumstances the
Issuer is required to apply the net cash proceeds from Asset Sales to offer to
repurchase Securities at a price equal to 100% of the aggregate principal amount
thereof, plus accrued interest to the date of repurchase.
10. Denominations; Transfer; Exchange. The Securities are in registered
form, without coupons, in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange Securities in
accordance with the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and to pay
certain transfer taxes or similar governmental charges payable in connection
therewith as permitted by the Indenture. The Registrar or co-Registrar shall not
be required to register the transfer of or exchange of any Security (i) during a
period beginning at the opening of business 15 days before the mailing of a
notice of redemption of Securities and ending at the close of business on the
day of such mailing, (ii) selected for redemption in whole or in part pursuant
to Article Three of the Indenture, except the unredeemed portion of any Security
being redeemed in part and (iii) during a Change of Control Offer or an Asset
Sale Offer if such Security is tendered pursuant to such Change of Control Offer
or Asset Sale Offer and not withdrawn.
11. Persons Deemed Owners. The registered Holder of a Security shall be
treated as the owner of it for all purposes.
-17-
12. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for one year, the Trustee and the Paying Agent will pay the
money back to the Issuer. After that, all liability of the Trustee and such
Paying Agent with respect to such money shall cease.
13. Discharge Prior to Redemption or Maturity. If the Issuer at any time
deposits with the Trustee U.S. Legal Tender or U.S. Government Obligations
sufficient to pay the principal of and interest on the Securities to redemption
or maturity and complies with the other provisions of the Indenture relating
thereto, the Issuer will be discharged from certain provisions of the Indenture
and the Securities (including certain covenants, but excluding its obligation to
pay the principal of and interest on the Securities).
14. Amendment; Supplement; Waiver. Subject to certain exceptions, the
Indenture or the Securities may be amended or supplemented with the written
consent of the Holders of at least a majority in aggregate principal amount of
the Securities then outstanding, and any existing Default or Event of Default or
noncompliance with any provision may be waived with the written consent of the
Holders of a majority in aggregate principal amount of the Securities then
outstanding. Without notice to or consent of any Holder, the parties thereto
may amend or supplement the Indenture or the Securities to, among other things,
cure any ambiguity, defect or inconsistency, provide for uncertificated
Securities in addition to or in place of certificated Securities, provide for
the assumption of the Issuer's obligations to Holders of the Securities in the
event of any Disposition involving the Issuer in which the Issuer is not a
Surviving Person, comply with requirements of the SEC in order to effect or
maintain the qualification of the Indenture under TIA, provide for the issuance
of Exchange Securities or make any other change that does not adversely affect
in any material respect the legal rights under the Indenture of any Holder of a
Security.
15. Restrictive Covenants. The Indenture imposes certain limitations on
the ability of the Issuer and its Restricted Subsidiaries to, among other
things, incur additional Debt, make payments in respect of its Equity Interest
or certain Debt, enter into transactions with Related Persons, create dividend
or other payment restrictions affecting Restricted Subsidiaries and merge or
consolidate with any other Person, sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its assets or adopt a plan of
liquidation. Such limitations are subject to a number of important
qualifications and exceptions. The Issuer must annually report to the Trustee on
compliance with such limitations.
16. Successors. When a successor assumes, in accordance with the
Indenture, all the obligations of its predecessor under the
-18-
Securities and the Indenture, the predecessor will be released from those
obligations.
17. Defaults and Remedies. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of Securities then outstanding may declare all the Securities to be due
and payable in the manner, at the time and with the effect provided in the
Indenture. Holders of Securities may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee is not obligated to
enforce the Indenture or the Securities unless it has been offered indemnity or
security reasonably satisfactory to it. The Indenture permits, subject to
certain limitations therein provided, Holders of a majority in aggregate
principal amount of the Securities then outstanding to direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders of
Securities notice of any continuing Default or Event of Default (except a
Default in payment of principal or interest) if it determines in good faith that
withholding notice is in their interest.
18. Defeasance. The Indenture contains provisions (which provisions
apply to this Security) which provide that (a) the Issuer will be discharged
from any and all obligations in respect of the Securities and the Guarantors
will be released from their Guarantees and (b) the payment of the Securities may
not be accelerated upon certain Events of Default, in each case upon compliance
by the Issuer with certain conditions set forth therein.
19. Trustee Dealings with Issuer. The Trustee under the Indenture, in
its individual or any other capacity, may become the owner or pledgee of
Securities and may otherwise deal with the Issuer, Subsidiaries of the Issuer or
their respective Affiliates as if it were not the Trustee.
20. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, stockholder or limited or general partner of
the Issuer or any of its Subsidiaries shall have any liability for any
obligations of the Issuer or any of its Subsidiaries under the Securities or the
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creations. Each Holder of a Security by accepting a
Security waives and releases all such liability. Such waiver and release are
part of the consideration for the issuance of the Securities.
21. Authentication. This Security shall not be valid until the Trustee
or authenticating agent manually signs the certificate of authentication on
this Security.
22. Governing Law. The laws of the State of New York shall govern this
Security and the Indenture, without regard to principles of conflict of law
other than Section 5-1401 of the New York General Obligations Law.
-19-
23. Abbreviations and Defined Terms. Customary abbreviations may be
used in the name of a Holder of a Security or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint
tenants with right of survivorship and not as tenants in common), CUST (=
Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
24. CUSIP Numbers. Pursuant to a recommendation promulgated by the
committee on Uniform Security Identification Procedures, the Issuer has caused
CUSIP numbers to be printed on the Securities as a convenience to the Holders of
the Securities. No representation is made as to the accuracy of such numbers as
printed on the Securities and reliance may be placed only on the other
identification numbers printed hereon.
25. Indenture. Each Holder, by accepting a Security, agrees to be bound
by all of the terms and provisions of the Indenture, as the same may be amended
from time to time. Capitalized terms used herein and not defined herein have the
meanings ascribed thereto in the Indenture.
The Issuer will furnish to any Holder of a Security upon written
request and without charge a copy of the Indenture, which has the text of this
Security in larger type. Requests may be made to:
Communications Instruments, Inc.
1396 Charlotte Highway
Fairview, North Carolina 29730
Attention: David Henning
-20-
[FORM OF ASSIGNMENT]
I or we assign to
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER
_________________________________
________________________________________________________________________________
(please print or type name and address)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing
________________________________________________________________________________
attorney to transfer the Security on the books of the Issuer with full power of
substitution in the premises.
Date: ________________ Your Signature: ______________________________
NOTICE: The signature on this
assignment must correspond with the
name as it appears upon the face of
the within Security in every
particular without alteration or
enlargement or any change whatsoever
and be guaranteed by the endorser's
bank or broker.
Signature Guarantee: ___________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
-21-
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Issuer pursuant to
Section 4.15 or 4.16 of the Indenture, check the appropriate Box:
Section 4.15 [ ]
Section 4.16 [ ]
If you wish to have a portion of this Security purchased by the Issuer
pursuant to Section 4.15 or 4.16 of the Indenture, state the amount you wish to
have purchased:
US$_________
Date: ________________ Your Signature: _______________________________________
(Sign exactly as your name appears on
the other side of this Security)
Signature Guarantee: ___________________________________________________________
Participant in a recognized Signature Guarantee
Medallion Program (or other signature guarantor program
reasonably acceptable to the Trustee)
-22-
Exhibit B
---------
FORM OF LEGEND FOR BOOK-ENTRY SECURITIES
Any Global Security authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY
TRUST COMPANY (THE "DEPOSITARY") OR A NOMINEE OF THE DEPOSITARY OR A
SUCCESSOR. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN
THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY
TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IT IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OF OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
TRANSFERS OF GLOBAL SECURITIES SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO THE DEPOSITARY, ITS SUCCESSORS OR THEIR RESPECTIVE
NOMINEES. INTERESTS OF BENEFICIAL OWNERS IN THE GLOBAL SECURITIES MAY BE
TRANSFERRED OR EXCHANGED FOR CERTIFICATED SECURITIES IN ACCORDANCE WITH THE
RULES AND PROCEDURES OF THE DEPOSITARY AND THE PROVISIONS OF SECTION 2.16
OF THE INDENTURE. IN ADDITION, CERTIFICATED SECURITIES SHALL BE
TRANSFERRED TO ALL BENEFICIAL OWNERS IN EXCHANGE FOR THEIR BENEFICIAL
INTERESTS IN GLOBAL SECURITIES IF (i) THE ISSUER NOTIFIES THE REGISTRAR
THAT THE DEPOSITARY IS UNWILLING OR UNABLE TO CONTINUE AS DEPOSITARY FOR
ANY GLOBAL SECURITY AND A SUCCESSOR DEPOSITARY IS NOT APPOINTED BY THE
ISSUER WITHIN 90 DAYS OF SUCH NOTICE OR (ii) THE ISSUER, AT ITS OPTION,
NOTIFIES THE REGISTRAR IN WRITING THAT IT ELECTS TO CAUSE THE ISSUANCE OF
SECURITIES IN DEFINITIVE FORM UNDER THE INDENTURE.
-23-
EXHIBIT C
---------
Transfers to Non-QIB Accredited Investors
-----------------------------------------
___________________, ____
____________________, as Registrar
__________________________________
__________________________________
__________________________________
Re: COMMUNICATIONS INSTRUMENTS, INC.
10% Senior Subordinated Notes
due 2004
-------------------------------------
Ladies and Gentlemen:
In connection with our proposed purchase of 10% Senior Subordinated
Notes due 2004 and related guarantees (the "Securities") of Communications
Instruments, Inc., a North Carolina corporation (the "Issuer"), and Kilovac
Corporation, a California corporation and Kilovac International, Inc., a
California corporation, we confirm that:
1. We have received a copy of the Offering Memorandum (the "Offering
Memorandum"), dated September 12, 1997, relating to the Securities and such
other information as we deem necessary in order to make our investment decision.
We acknowledge that we have read and agreed to the matters stated on pages (82)
through (84) and in the section entitled "Transfer Restrictions" of the Offering
Memorandum, including the restrictions on duplication and circulation of the
Offering Memorandum.
2. We have received a copy of the Offering Memorandum and
acknowledge that we have had access to such financial and other information, and
have been afforded the opportunity to ask such questions of representatives of
the Issuer and receive answers thereto, as we deem necessary in connection with
our decision to purchase the Securities.
3. We are not acquiring Securities with a view to any distribution
thereof in a transaction that would violate the Securities Act or the securities
laws of any State of the United States or any other applicable jurisdiction;
provided that the disposition of our property and the property of any accounts
for which we are acting as fiduciary shall remain at all times within our
control.
4. We understand that any subsequent transfer of the Securities is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Securities (as described in the Offering Memorandum) and the
undersigned agrees to be bound by,
-24-
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").
5. In the event that we purchase any Securities, we will acquire
Securities having a minimum purchase price of at least $100,000 for our own
account and for each separate account for which we are acting.
6. We understand that the offer and sale of the Securities have not
been registered under the Securities Act, and that the Securities may not be
offered or sold except as permitted in the following sentence. We agree, on our
own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell any Securities, we will do so only (i) to the
Issuer or any of its subsidiaries, (ii) in accordance with Rule 144A under the
Securities Act to a "qualified institutional buyer" (as defined in Rule 144A
under the Securities Act), (iii) inside the United States to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to the Trustee and the
Registrar (each as defined in the Indenture relating to the Securities), a
signed letter containing certain representations and agreements relating to the
restrictions on transfer of the Securities (the form of which letter can be
obtained from the Trustee and the Registrar), (iv) outside the United States in
accordance with Rule 904 of the Regulation S under the Securities Act, (v)
pursuant to the exemption from registration provided by Rule 144 under the
Securities Act (if available), or (vi) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to any
person purchasing any of the Securities from us a notice advising such purchaser
that resales of the Securities are restricted as stated herein.
7. We are not acquiring the Securities for or on behalf of, and will
not transfer the Securities to, any pension or welfare plan (as defined in
Section 3 of the Employee Retirement Income Security Act of 1974), except as
permitted in the section entitled "Transfer Restrictions" of the Offering
Memorandum.
8. We understand that, on any proposed resale of any Securities, we
will be required to furnish to the Trustee, the Registrar and the Issuer, such
certification, legal opinions and other information as the Trustee, the
Registrar and the Issuer may reasonably require to confirm that the proposed
sale complies with the foregoing restrictions. We further understand that the
Securities purchased by us will bear a legend to the foregoing effect.
9. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under
-25-
the Securities Act) and have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Securities, and we and any accounts for which we are acting
are each able to bear the economic risk of our or their investment, as the case
may be.
10. We are acquiring the Securities purchased by us for our account
or for one or more accounts (each of which is an "Institutional Accredited
Investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act) as to each of which we exercise sole investment discretion and
have authority to enter into this letter and purchase the Securities.
-26-
You, the Issuer and the Initial Purchasers are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
By: ___________________________
Name:
Title:
-27-
EXHIBIT D
---------
Form of Certificate to Be Delivered
in Connection with Transfers
Pursuant to Regulation S
------------------------
_______________, _______
________________________
________________________
________________________
Attention:________________________
Re: Communications Instruments, Inc. (the "Issuer")
10% Senior Secured Notes due 2004
--------------------------------------------------
Ladies and Gentlemen:
In connection with our proposed sale of $95,000,000 aggregate
principal amount of the 10% Senior Subordinated Notes due 2004 and related
guarantees (the "Securities"), we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "Securities Act"), and the transfer restrictions set forth
in the Securities and, accordingly, we represent that:
1. The offer of the Securities was not made to a person in the
United States;
2. Either (a) at the time the buy order 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" (as defined in Rule 904 of the
Securities Act) 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
D-1
5. We have advised the transferee of the transfer restrictions
applicable to the Securities.
You and the Issuer are entitled to rely upon this letter and are
irrevocably authorized to produce this certificate 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
D-2