EXHIBIT 4.6
EXECUTION VERSION
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EXTENDICARE HEALTH SERVICES, INC.,
as Issuer
6 7/8% SENIOR SUBORDINATED NOTES DUE 2014
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INDENTURE
Dated as of April 22, 2004
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U.S. BANK, N.A.,
as Trustee
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This INDENTURE dated as of April 22, 2004, is by and among
Extendicare Health Services, Inc., a Delaware corporation (the "Company"), the
Subsidiary Guarantors listed on the signature pages hereto and U.S. Bank, N.A.,
as trustee (the "Trustee").
The Company, the Subsidiary Guarantors and the Trustee agree as
follows for the benefit of each other and for the equal and ratable benefit of
the Holders of the 6 7/8% Senior Subordinated Notes due 2014 (the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. DEFINITIONS.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
"144A Global Note" means the global note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold in reliance on Rule 144A.
"Acquired Debt" means, with respect to any specified Person:
(1) Indebtedness of any other Person existing at the time such other
Person is merged with or into or became a Subsidiary of such specified Person,
whether or not such Indebtedness is incurred in connection with, or in
contemplation of, such other Person merging with or into, or becoming a
Subsidiary of, such specified Person; and
(2) Indebtedness secured by a Lien encumbering any asset acquired by
such specified Person.
"Additional Interest" shall have the meaning set forth in the
Registration Rights Agreement.
"Additional Notes" means any Notes (other than Initial Notes and
Exchange Notes) issued under this Indenture in accordance with Sections 2.02 and
4.09 hereof, as part of the same series as the Initial Notes.
"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,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"Agent" means any Registrar, co-registrar, Paying Agent or
additional paying agent.
"Applicable Procedures" means, with respect to any transfer,
redemption or exchange of or for beneficial interests in any Global Note, the
rules and procedures of the Depositary, Euroclear and Clearstream that apply to
such transfer, redemption or exchange.
"Asset Sale" means the sale, lease, conveyance or other disposition
of any assets or rights (including, without limitation, (x) a sale and
leaseback, (y) the issuance, sale or other transfer of any Equity Interests in
any of our Unrestricted Subsidiaries, and (z) the receipt of proceeds of
insurance paid on account of the loss of or damage to any asset and awards of
compensation for any asset taken by condemnation, eminent domain or similar
proceeding, and including the receipt of proceeds of business interruption
insurance) in each case, in one or a series
of related transactions that have a fair market value in excess of $2.0 million
or for Net Proceeds in excess of $2.0 million; provided that the sale,
conveyance or other disposition of all or substantially all of the assets of the
Company and its Restricted Subsidiaries taken as a whole will be governed by
Section 4.18 and/or Section 5.01 and not by Section 4.12.
Notwithstanding the preceding, the following items will not be
deemed to be Asset Sales:
(1) the sale, lease or other disposition of equipment, inventory,
accounts receivable or other assets or rights in the ordinary course of
business;
(2) a transfer of assets or rights by the Company to a Subsidiary
Guarantor, or by a Subsidiary Guarantor to the Company or to another Subsidiary
Guarantor;
(3) an issuance of Equity Interests by a Subsidiary Guarantor to the
Company or to another Subsidiary Guarantor;
(4) a Restricted Payment or Permitted Investment that is permitted
by Section 4.10;
(5) the sale of property or equipment that has become worn out,
obsolete or damaged;
(6) the sale or other disposition of Cash Equivalents;
(7) the sale of accounts receivable pursuant to a Securitization
Transaction; or
(8) the designation of any Restricted Subsidiary as an Unrestricted
Subsidiary or the contribution to the capital of any Unrestricted Subsidiary in
accordance with the provisions described under Section 4.17.
"Attributable Debt" in respect of a sale and leaseback transaction
means, at the time of determination, the greater of (a) the fair value of the
property subject to such arrangement (as determined in good faith by the Board
of Directors of the Company) or (b) the present value (discounted at the
interest rate borne by the Notes, compounded annually) of the total obligations
of the lessee for 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.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal,
state or foreign law for the relief of debtors.
"Board of Directors" means:
(1) with respect to a corporation, the board of directors of the
corporation;
(2) with respect to a partnership, the board of directors of the
general partner of the partnership; and
(3) with respect to any other Person, the board or committee of such
Person serving a similar function. "Board Resolution" means a copy of a
resolution certified by the Secretary or an Assistant Secretary of the
applicable Person to have been duly adopted by the Board of Directors of such
Person and to be in full force and effect on the date of such certification, and
delivered to the Trustee.
"Business Day" means any day other than a Legal Holiday.
"Capital Lease Obligation" means, at the time any determination is
to be made, the amount of the liability in respect of a capital lease that would
at that time be required to be capitalized on a balance sheet in accordance with
GAAP.
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"Capital Stock" means:
(1) in the case of a corporation, any and all shares, including
common stock and preferred stock;
(2) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and
(4) 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:
(1) United States dollars;
(2) securities issued or directly and fully guaranteed or insured by
the United States government or any agency or instrumentality of the United
States government (provided that the full faith and credit of the United States
is pledged in support of those securities) having maturities of not more than
six months from the date of acquisition;
(3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case, with any lender party to the Credit Agreement or with
any domestic commercial bank having capital and surplus in excess of $500.0
million and a Thomson Bank Watch Rating of "B" or better;
(4) repurchase obligations with a term of not more than seven days
for underlying securities of the types described in clauses (2) and (3) above
entered into with any financial institution meeting the qualifications specified
in clause (3) above;
(5) commercial paper having the highest rating obtainable from
Moody's Investors Service, Inc. or Standard & Poor's Rating Services and in each
case maturing within six months after the date of acquisition; and
(6) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1) through (5) of
this definition.
"Change of Control" means the occurrence of any of the following:
(1) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all or substantially all of the assets
of the Company to any Person or group of related Persons for purposes of Section
13(d) of the Exchange Act (a "Group"), together with any Affiliates thereof
(whether or not otherwise in compliance with the provisions of this Indenture);
(2) the approval by the holders of Capital Stock of the Company of
any plan or proposal for the liquidation or dissolution of the Company (whether
or not otherwise in compliance with the provisions of this Indenture);
(3) any Person or Group (other than Parent or any direct or indirect
wholly owned Subsidiary of Parent) becomes the owner, directly or indirectly,
beneficially or of record, of shares representing more than 35% of the aggregate
ordinary voting power represented by the issued and outstanding Capital Stock of
the Company on a fully-diluted basis;
(4) the replacement of a majority of the Board of Directors of
Parent or the Company over a two-year period from the directors who constituted
the Board of Directors of Parent or the Company, as applicable, at
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the beginning of such period, and such replacement shall not have been approved
by a vote of at least a majority of the Board of Directors of Parent or the
Company, as applicable, then still in office who either were members of such
Board of Directors at the beginning of such period or whose election as a member
of such Board of Directors was previously so approved; or
(5) the Company consolidates with, or merges with or into, any
Person, or any Person consolidates with, or merges with or into, the Company, in
any such event pursuant to a transaction in which any of the Company's
outstanding Voting Stock or the outstanding Voting Stock of such other Person is
converted into or exchanged for cash, securities or other property, other than
any such transaction where the Company's Voting Stock outstanding immediately
prior to such transaction is converted into or exchanged for Voting Stock (other
than Disqualified Stock) of the surviving or transferee Person constituting a
majority of the outstanding shares of such Voting Stock of such surviving or
transferee Person (immediately after giving effect to such issuance).
"Clearstream" means Clearstream Banking S.A. and any successor
thereto.
"Code" means the Internal Revenue Code of 1986, as amended.
"Consolidated Cash Flow" means, with respect to any specified Person
for any period, the Consolidated Net Income of such Person for such period plus:
(1) an amount equal to any extraordinary loss plus any net loss
realized by such Person or any of its Subsidiaries in connection with an Asset
Sale, to the extent such losses were deducted in computing such Consolidated Net
Income; plus
(2) provision for taxes based on income or profits of such Person
and its Restricted Subsidiaries for such period, to the extent that such
provision for taxes was deducted in computing such Consolidated Net Income; plus
(3) consolidated interest expense of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued and whether or not
capitalized (including, without limitation, amortization of debt issuance costs
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 of the
effect of all payments made or received pursuant to Hedging Obligations), to the
extent that any such expense was deducted in computing such Consolidated Net
Income; plus
(4) depreciation, amortization (including amortization of goodwill
and other intangibles but excluding amortization of prepaid cash expenses that
were paid in a prior period) and other non-cash expenses (excluding any such
non-cash expense to the extent that it represents an accrual of or reserve for
cash expenses in any future period) of such Person and its Restricted
Subsidiaries for such period to the extent that such depreciation, amortization
and other non-cash expenses were deducted in computing such Consolidated Net
Income; minus
(5) non-cash items increasing such Consolidated Net Income for such
period, other than the accrual of revenue in the ordinary course of business,
in each case, on a consolidated basis and determined in accordance with GAAP.
"Consolidated Net Income" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:
(1) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting will be included only to the extent of the amount of dividends or
distributions paid in cash to the specified Person or a Restricted Subsidiary of
the Person;
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(2) the Net Income of any Restricted Subsidiary will be excluded to
the extent that the declaration or payment of dividends or similar distributions
by that Restricted 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 Restricted Subsidiary or its
stockholders; and
(3) the cumulative effect of a change in accounting principles will
be excluded.
In addition, notwithstanding the foregoing, for the purposes of
Section 4.10 only, there shall be excluded from Consolidated Net Income any
nonrecurring charges relating to any premium or penalty paid, write off or
deferred finance costs or other charges in connection with redeeming or retiring
any Indebtedness at or prior to its Stated Maturity.
"Corporate Trust Office of the Trustee" shall be at the address of
the Trustee specified in Section 12.02 hereof or such other address as to which
the Trustee may give notice to the Company.
"Consolidated Tangible Assets" means the total assets, less goodwill
and other intangibles, shown on the Company's most recent consolidated balance
sheet, determined on a consolidated basis in accordance with GAAP less all
write-ups (other than write-ups in connection with acquisitions) subsequent to
the date of this Indenture in the book value of any asset (except any such
intangible assets) owned by the Company or any of its Restricted Subsidiaries.
"Credit Agreement" means that certain Second Amended and Restated
Credit Agreement, dated as of the date hereof, by and among Extendicare
Holdings, Inc., the Company, Lehman Commercial Paper Inc., as administrative
agent, and the lenders party thereto, including any related notes, guarantees,
security and collateral documents, instruments and agreements executed in
connection therewith.
"Credit Facilities" means one or more debt facilities or agreements
(including, without limitation, the Credit Agreement) or commercial paper
facilities, in each case with banks or other lenders providing for revolving
credit loans, term loans, notes, 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) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced, restructured,
restated or refinanced (including any agreement to extend the maturity thereof
and adding additional borrowers or guarantors) in whole or in part from time to
time under the same or any other agent, lender or group of lenders and including
increasing the amount of available borrowings thereunder; provided that such
increase is permitted by Section 4.09.
"Custodian" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
Custodian with respect to the Notes, any and all successors thereto appointed as
custodian hereunder and having become such pursuant to the applicable provisions
of this Indenture.
"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.
"Definitive Note" means a certificated Note registered in the name
of the Holder thereof and issued in accordance with Section 2.06 hereof, in
substantially the form of Exhibit A hereto except that such Note shall not bear
the Global Note Legend and shall not have the "Schedule of Exchanges of
Interests in the Global Note" attached thereto.
"Designated Non-Cash Consideration" means the fair market value of
total consideration received by the Company or any of its Restricted
Subsidiaries in connection with an Asset Sale that is so designated as
Designated Non-Cash Consideration pursuant to an Officers' Certificate, setting
forth the basis of such valuation, executed by the Company's principal executive
officer and principal financial officer, less the amount of cash or Cash
Equivalents received in connection with the Asset Sale; provided, however, that
the total amount of Designated Non-Cash Consideration outstanding at any one
time does not exceed the greater of $15.0 million and 2.5% of Consolidated
Tangible Assets.
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"Designated Senior Debt" means (i) any Indebtedness outstanding
under the Credit Agreement, (ii) any Indebtedness represented by the Senior
Notes and (iii) any other Senior Debt permitted hereunder, the principal amount
of which is $25.0 million or more and that has been designated by the Company as
"Designated Senior Debt."
"Depositary" means, with respect to the Notes issuable or issued in
whole or in part in global form, the Person specified in Section 2.03 hereof as
the Depositary with respect to the Notes, and any and all successors thereto
appointed as depositary hereunder and having become such pursuant to the
applicable provisions of this Indenture.
"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, in each case at the option of the holder of the Capital Stock), 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 of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the Notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require the
Company to repurchase such Capital Stock upon the occurrence of a change of
control or an asset sale will not constitute Disqualified Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.10.
"Distribution Compliance Period" means the 40-day distribution
compliance period as defined in Regulation S.
"Domestic Subsidiary" means any Restricted Subsidiary of the Company
that was formed under the laws of the United States or any state of the United
States or the District of Columbia.
"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).
"Euroclear" means Euroclear Bank, S.A./N.V., as operator of the
Euroclear systems, and any successor thereto.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Notes" means Notes issued in the Exchange Offer pursuant
to Section 2.06(f) hereof.
"Exchange Offer" has the meaning set forth in the Registration
Rights Agreement.
"Exchange Offer Registration Statement" has the meaning set forth in
the Registration Rights Agreement.
"Existing Indebtedness" means Indebtedness of the Company and its
Subsidiaries (other than Indebtedness under the Credit Agreement) in existence
on the date of this Indenture, until such amounts are repaid.
"Existing Senior Subordinated Indebtedness" means Indebtedness of
the Company and the Subsidiary Guarantors represented by the Senior Subordinated
Notes, until such amounts are repaid.
"Fixed Charge Coverage Ratio" means with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
and its Restricted Subsidiaries for such period to the Fixed Charges of such
Person and its Restricted Subsidiaries for such period. In the event that the
specified Person or any of its Restricted Subsidiaries incurs, assumes,
Guarantees, repays, repurchases or redeems any Indebtedness (other than ordinary
working capital borrowings) or issues, repurchases or redeems preferred stock
subsequent to the commencement of the reference period for which the Fixed
Charge Coverage Ratio is being calculated and on or prior to the date on which
the event for which the calculation of the Fixed Charge Coverage Ratio is made
(the
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"Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated
giving pro forma effect to such incurrence, assumption, Guarantee, repayment,
repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock and the use of the proceeds therefrom, as if the
same had occurred at the beginning of the applicable four-quarter reference
period; provided, however, that the Fixed Charges of such Person attributable to
interest on any Indebtedness under a revolving credit facility computed on a pro
forma basis will be computed based on the average daily balance of such
Indebtedness during the four-quarter reference period and using the interest
rate in effect at the end of such period.
In addition, for purposes of calculating the Fixed Charge Coverage
Ratio:
(1) acquisitions that have been made by the specified Person or any
of its Restricted Subsidiaries, including through mergers or consolidations and
including any related financing transactions, subsequent to the commencement of
the applicable four-quarter reference period and on or prior to the Calculation
Date will be given pro forma effect as if they had occurred on the first day of
such period, including any Consolidated Cash Flow and any pro forma expense and
cost reductions that have occurred or are reasonably expected to occur, in the
reasonable judgment of the Company's chief financial officer (regardless of
whether those cost savings or operating improvements could then be reflected in
pro forma financial statements in accordance with Regulation S-X promulgated
under the Securities Act or any other regulation or policy of the SEC related
thereto);
(2) 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, will be excluded; and
(3) the Fixed Charges attributable to discontinued operations, as
determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, will be excluded, but only to the extent that the
obligations giving rise to such Fixed Charges will not be obligations of the
specified Person or any of its Restricted Subsidiaries following the Calculation
Date.
"Fixed Charges" means, with respect to any specified Person for any
period, the sum, without duplication, of:
(1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, including,
without limitation, amortization of debt issuance costs 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 of the effect of all
payments made or received pursuant to Hedging Obligations; plus
(2) the consolidated interest of such Person and its Restricted
Subsidiaries that was capitalized during such period; plus
(3) any interest expense on Indebtedness of another Person that is
Guaranteed by such Person or secured by a Lien on assets of such Person, whether
or not such Guarantee or Lien is called upon; plus
(4) the product of (a) all dividends, whether paid or accrued and
whether or not in cash, on any series of preferred stock of such Person or any
of its Restricted Subsidiaries other than dividends on Equity Interests payable
solely in Equity Interests of such Person (other than Disqualified Stock) or to
such Person or one of its Restricted Subsidiaries, 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.
"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
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other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of this Indenture.
"Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.
"Global Notes" means the global Notes in the form of Exhibit A
hereto issued in accordance with Article 2 hereof.
"Government Securities" means direct obligations (or certificates
representing an ownership interest in such obligations) of the United States of
America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and
which are not callable at the Company's option.
"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, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.
"Hedging Obligations" means, with respect to any specified Person,
the obligations of such Person under:
(1) interest rate swap agreements, interest rate cap agreements and
interest rate collar agreements;
(2) other agreements or arrangements designed to protect such Person
against fluctuations in interest rates; and
(3) foreign exchange contracts, currency swap agreements or other
agreements or arrangements designed to protect such Person against fluctuations
in currency values.
"Holder" means a Person in whose name a Note is registered.
"IAI Global Note" means a global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold to Institutional Accredited Investors, if any.
"Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:
(1) in respect of borrowed money;
(2) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof);
(3) in respect of banker's acceptances;
(4) representing Capital Lease Obligations;
(5) representing the balance deferred and unpaid of the purchase
price of any property, except any such balance that constitutes an accrued
expense or trade payable; or
(6) representing any Hedging Obligations,
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if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any Indebtedness of any other Person.
The amount of any Indebtedness outstanding as of any date will be:
(1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount; and
(2) the principal amount of the Indebtedness, together with any
interest on the Indebtedness that is more than 30 days past due, in the case of
any other Indebtedness.
"Indenture" means this instrument, as originally executed or as it
may from time to time be supplemented or amended in accordance with Article 9
hereof.
"Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.
"Initial Notes" means $125,000,000 aggregate principal amount of
Notes issued under this Indenture on the date hereof.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including Guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP; provided that
Investments shall not be deemed to include extensions of trade credit by the
Company or any of its Restricted Subsidiaries on commercially reasonable terms
in accordance with normal trade practices. If the Company or any of its
Subsidiaries sells or otherwise disposes of any Equity Interests of any direct
or indirect Subsidiary of the Company such that, after giving effect to any such
sale or disposition, such Person is no longer a Subsidiary of the Company, the
Company will 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 in the
final paragraph of Section 4.10. The acquisition by the Company or any of its
Subsidiaries of a Person that holds an Investment in a third Person will be
deemed to be an Investment by the Company or such Subsidiary in such third
Person in an amount equal to the fair market value of the Investment held by the
acquired Person in such third Person in an amount determined as provided in the
final paragraph of Section 4.10.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York, the city in which the Corporate Trust
Office of the Trustee is located, or at a place of payment are authorized by
law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Initial Notes for use by
such Holders in connection with the Exchange Offer.
"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
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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.
"Moody's" means Moody's Investors Service, Inc. or any successor to
the rating agency business thereof.
"Net Income" means, with respect to any specified 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:
(1) any gain (but not loss), together with any related provision for
taxes on such gain (but not loss), realized in connection with: (a) any Asset
Sale or (b) the disposition of any securities by such Person or any of its
Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person
or any of its Restricted Subsidiaries; and
(2) any extraordinary gain (but not loss), together with any related
provision for taxes on such extraordinary gain (but not loss).
"Net Proceeds" means the aggregate cash proceeds received by the
Company 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, including Designated Non-Cash
Consideration, deemed to be cash pursuant to Section 4.12, received in any Asset
Sale), net of 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 of the Asset Sale,
taxes paid or payable as a result of the Asset Sale, in each case, after taking
into account any available tax credits or deductions and any tax sharing
arrangements, and amounts required to be applied to the repayment of
Indebtedness, other than Senior Debt, secured by a Lien on the asset or assets
that were the subject of such Asset Sale, and any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP.
"Non-Recourse Debt" means Indebtedness:
(1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness), (b) is directly or
indirectly liable as a guarantor or otherwise, or (c) constitutes the lender;
(2) no default with respect to which (including any rights that the
holders thereof may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any
other Indebtedness (other than the Notes) of the Company or any of its
Restricted Subsidiaries to declare a default on such other Indebtedness or cause
the payment thereof to be accelerated or payable prior to its stated maturity;
and
(3) as to which the lenders have been notified in writing that they
will not have any recourse to the Company's stock or assets or the stock or
assets of any of the Company's Restricted Subsidiaries.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Officer" means the Chief Executive Officer, the President, the
Chief Financial Officer, or any Senior Vice President of the Company.
"Officers' Certificate" means a certificate, in form and substance
reasonably satisfactory to the Trustee, signed by two Officers of the Company,
at least one of whom shall be the principal executive officer or principal
financial officer of the Company, and delivered to the Trustee.
10
"Opinion of Counsel" means a written opinion, in form and substance
reasonably satisfactory to the Trustee, from legal counsel who is acceptable to
the Trustee and which meets the requirements of Section 12.05 hereof. The
counsel may be an employee of or counsel to the Company or the Trustee.
"Parent" means Extendicare, Inc., a corporation organized under the
laws of Canada.
"Participant" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively, and, with respect to The Depository Trust Company,
shall include Euroclear and Clearstream.
"Permitted Business" means the lines of business conducted by the
Company and its Restricted Subsidiaries on the date hereof and the businesses
reasonably related thereto within the healthcare services sector.
"Permitted Investments" means:
(1) any Investment in the Company or in one of its Wholly Owned
Restricted Subsidiaries;
(2) any Investment outstanding as of the date hereof;
(3) any Investment in Cash Equivalents;
(4) loans and advances to employees and officers of the Company and
its Restricted Subsidiaries in the ordinary course of business for bona fide
business purposes not in excess of $1.0 million at any one time outstanding;
(5) Investments in prepaid expenses, negotiable instruments held for
collection and lease, utility and workers' compensation, performance and other
similar deposits;
(6) any Investment by the Company or any of its Restricted
Subsidiaries in a Person engaged in a Permitted Business, if as a result of such
Investment:
(a) such Person becomes one of the Company's Wholly Owned
Restricted Subsidiaries; or
(b) such Person is merged, consolidated or amalgamated with or
into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or one of its Wholly Owned Restricted
Subsidiaries;
(7) any Investment made as a result of the receipt of non-cash
consideration (including Designated Non-Cash Consideration) from an Asset Sale
that was made pursuant to and in compliance with Section 4.12;
(8) any acquisition of assets, Equity Interests or other securities
solely in exchange for the issuance of Equity Interests (other than Disqualified
Stock) of the Company;
(9) any Investments received in compromise of obligations of such
Persons incurred in the ordinary course of trade creditors or customers that
were incurred in the ordinary course of business, including pursuant to any plan
of reorganization or similar arrangement upon the bankruptcy or insolvency of
any trade creditor or customer;
(10)Hedging Obligations;
(11)any Investment made in a Special Purpose Vehicle in connection
with a Securitization Transaction or to provide adequate capital to a Special
Purpose Vehicle in anticipation of one or more Securitization Transactions; and
11
(12)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 (12) that are at the time outstanding,
not to exceed $25.0 million.
"Permitted Junior Securities" means:
(1) Equity Interests in the Company or any Subsidiary Guarantor; or
(2) debt securities that are subordinated (to substantially the same
extent as, or to a greater extent than, the Notes and the Subsidiary Guarantees
are subordinated to Senior Debt hereunder) to all Senior Debt and any debt
securities issued in exchange for Senior Debt.
"Permitted Liens" means:
(1) Liens securing Senior Debt, where such Indebtedness was
permitted by the terms of this Indenture to be incurred;
(2) Liens in favor of the Company or the Subsidiary Guarantors;
(3) Liens on property of a Person existing at the time such Person
is merged with or into or consolidated with the Company or any of the Company's
Restricted Subsidiaries; provided that such Liens were in existence prior to the
contemplation of such merger or consolidation and do not extend to any assets
other than those of the Person merged into or consolidated with the Company or
such Restricted Subsidiary;
(4) Liens on property existing at the time of acquisition of the
property by the Company or any of its Restricted Subsidiaries; provided that
such Liens were in existence prior to the contemplation of such acquisition;
(5) Liens to secure the performance of statutory obligations, surety
or appeal bonds, performance bonds or other obligations of a like nature;
(6) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by clause (iv) of the second paragraph of Section 4.09
covering only the assets acquired with such Indebtedness;
(7) Liens existing on the date of this Indenture;
(8) Liens for taxes, assessments or governmental charges or claims
that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded; provided
that any reserve or other appropriate provision as is required in conformity
with GAAP has been made therefor;
(9) pledges or deposits in the ordinary course of business to secure
lease obligations or nondelinquent obligations under workers' compensation,
unemployment insurance or similar legislation;
(10) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the business or assets of the Company
or any of its Subsidiaries incurred in the ordinary course of business;
(11) Liens to secure Hedging Obligations, including any guarantees
of such Hedging Obligations; and
(12) Liens incurred by the Company or any of its Restricted
Subsidiaries with respect to obligations that do not exceed $20.0 million at any
one time outstanding.
"Permitted Refinancing Indebtedness" means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew,
12
replace, defease or refund other Indebtedness of the Company or any of its
Restricted Subsidiaries (other than intercompany Indebtedness); provided that:
(1) the principal amount (or accreted value, if applicable) of such
Permitted Refinancing Indebtedness does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness extended, refinanced,
renewed, replaced, defeased or refunded (plus all accrued interest on the
Indebtedness and the amount of all expenses and premiums incurred in connection
therewith);
(2) such Permitted Refinancing Indebtedness 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
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;
(3) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes,
such Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the Notes on
terms at least as favorable to the Holders of Notes as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded; and
(4) such Indebtedness is incurred either by the Company or by the
Subsidiary who is the obligor on the Indebtedness being extended, refinanced,
renewed, replaced, defeased or refunded.
Notwithstanding the foregoing, any debt incurred under Credit
Facilities pursuant to Section 4.09 shall be subject only to the refinancing
provision in the definition of Credit Facilities and not pursuant to the
requirements set forth in the definition of Permitted Refinancing Indebtedness.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"Private Placement Legend" means the legend set forth in Section
2.06(g)(i) hereof to be placed on all Notes issued under this Indenture except
as otherwise permitted by the provisions of this Indenture.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Qualified Equity Offering" means any underwritten public or any
private offering of Capital Stock (excluding Disqualified Stock) of the Company
or any of Parent's Capital Stock (excluding Disqualified Stock), in the latter
case, only to the extent that the net cash proceeds therefrom are contributed to
the Company's common or non-redeemable preferred equity capital.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of the date hereof, among the Company, the Subsidiary
Guarantors and the initial purchasers named therein, as such agreement may be
amended, modified or supplemented from time to time and, with respect to any
Additional Notes, one or more registration rights agreements between the Company
and the other parties thereto, as such agreement(s) may be amended, modified or
supplemented from time to time, relating to rights given by the Company to the
purchasers of Additional Notes to register such Additional Notes under the
Securities Act.
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Note" means the global note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with and registered in the name of the Depositary or its nominee
that will be issued in a denomination equal to the outstanding principal amount
of Notes sold in reliance on Regulation S.
"Replacement Assets" means any properties or assets used or useful
in a Permitted Business.
13
"Representative" means the trustee, agent or representative
expressly authorized to act in such capacity, if any, for an issue of Senior
Debt.
"Responsible Officer," when used with respect to the Trustee, means
any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.
"Restricted Definitive Note" means one or more Definitive Notes
bearing the Private Placement Legend.
"Restricted Global Notes" means the 144A Global Note, the IAI Global
Note and the Regulation S Global Note.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the
referent Person that is not an Unrestricted Subsidiary.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Securitization Transaction" means any sale, conveyance or other
disposition by the Company or any of its Restricted Subsidiaries of any accounts
receivable or any interest therein to a Special Purpose Vehicle.
"Senior Debt" means:
(1) all Indebtedness of the Company or of any Subsidiary Guarantor
outstanding under Credit Facilities and all Hedging Obligations with respect
thereto;
(2) any Indebtedness represented by the Senior Notes;
(3) any other Indebtedness of the Company or of any Subsidiary
Guarantor permitted to be incurred under the terms of this Indenture, unless the
instrument under which such Indebtedness is incurred expressly provides that it
is on a parity with or subordinated in right of payment to the Notes or any
Subsidiary Guarantee; and
(4) all Obligations with respect to the items listed in the
preceding clauses (1), (2) and (3).
Notwithstanding anything to the contrary in the preceding, Senior Debt will not
include:
(1) any liability for federal, state, local or other taxes owed or
owing by the Company;
(2) any Indebtedness of the Company to any of its Subsidiaries or
other Affiliates;
(3) any trade payables; or
14
(4) the portion of any Indebtedness that is incurred in violation of
this Indenture.
"Senior Notes" means the Company's 9-1/2% Senior Notes due 2010.
"Senior Subordinated Indebtedness" means (i) with respect to the
Company, the Notes and any other Indebtedness of the Company that specifically
provides that such Indebtedness is to have the same rank as the Notes in right
of payment and is not subordinated by its terms in right of payment to any
Indebtedness or other obligation of the Company which is not Senior Debt and
(ii) with respect to any Subsidiary Guarantor, the Subsidiary Guarantees and any
other Indebtedness of such Subsidiary Guarantor that specifically provides that
such Indebtedness is to have the same rank as the Subsidiary Guarantees in right
of payment and is not subordinated by its terms in right of payment to any
Indebtedness or other obligation of such Subsidiary Guarantor which is not
Senior Debt.
"Senior Subordinated Notes" means the Company's 9.35% Senior
Subordinated Notes due 2007.
"Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.
"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 Securities Act, as such Regulation is in effect on
the date hereof.
"Special Purpose Vehicle" means a bankruptcy-remote entity or trust
or other special purpose entity which is formed by the Company, any Subsidiary
of the Company or any other Person for the purpose of, and engages in no
material business other than, acting as a buyer in a Securitization Transaction
or other similar transactions of accounts receivable or other similar assets,
financing the purchases it makes as such a buyer and realizing, directly or
indirectly, on such accounts receivable or other similar assets.
"Stated Maturity" means, with respect to any installment of interest
or principal on any series of Indebtedness (including, without limitation, a
scheduled repayment or a scheduled sinking fund payment), the date on which the
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and will 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 Indebtedness" means any Indebtedness (whether
outstanding on the date hereof or thereafter incurred) that is subordinated or
junior in right of payment to the Notes or the Subsidiary Guarantees pursuant to
a written agreement, executed by the Person to whom such Indebtedness is owed,
to that effect.
"Subsidiary" means, with respect to any specified Person:
(1) 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 of the corporation, association or other
business entity is at the time owned or controlled, directly or indirectly, by
that Person or one or more of the other Subsidiaries of that Person (or a
combination thereof); and
(2) 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 that Person or one or more Subsidiaries
of that Person (or any combination thereof).
"Subsidiary Guarantee" means the Guarantee of the Notes by each of
the Subsidiary Guarantors pursuant to Article 10 and in the form of the
Guarantee attached as Exhibit E and any additional Guarantee of the Notes to be
executed by any Subsidiary of the Company pursuant to Section 4.19.
15
"Subsidiary Guarantors" means all of the Company's existing and
future domestic Significant Subsidiaries, all of the Company's existing and
future Domestic Subsidiaries that guarantee or incur any Indebtedness and any
other existing and future Significant Subsidiaries or Restricted Subsidiaries
that guarantee or otherwise provide direct credit support for Indebtedness of
the Company or any of its Domestic Subsidiaries.
"TIA" means the Trust Indenture Act of 1939, as amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Unrestricted Definitive Notes" means one or more Definitive Notes
that do not and are not required to bear the Private Placement Legend.
"Unrestricted Global Notes" means one or more Global Notes, in the
form of Exhibit A attached hereto, that do not and are not required to bear the
Private Placement Legend and are deposited with and registered in the name of
the Depositary or its nominee.
"Unrestricted Subsidiary" means any Subsidiary of the Company (or
any successor to any of them) that is designated by the Board of Directors of
the Company as an Unrestricted Subsidiary pursuant to a Board Resolution, but
only to the extent that such Subsidiary:
(1) has no Indebtedness other than Non-Recourse Debt;
(2) is not party to any agreement, contract, arrangement or
understanding with the Company or any of its Restricted Subsidiaries unless the
terms of any such agreement, contract, arrangement or understanding are no less
favorable to the Company or such Restricted Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of the Company;
(3) is a Person with respect to which neither the Company nor any of
its Restricted Subsidiaries has any direct or indirect obligation (a) to
subscribe for additional Equity Interests or (b) to maintain or preserve such
Person's financial condition or to cause such Person to achieve any specified
levels of operating results;
(4) has not guaranteed or otherwise directly or indirectly provided
credit support for any Indebtedness of the Company or any of its Restricted
Subsidiaries; and
(5) has at least one director on its Board of Directors that is not
a director or executive officer of the Company or any of its Restricted
Subsidiaries and has at least one executive officer that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries.
Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary will be evidenced to the Trustee by filing with the Trustee a
certified copy of the resolution of the Board of Directors of the Company giving
effect to such designation and an Officers' Certificate certifying that such
designation complied with the preceding conditions and was permitted by Section
4.10 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the
preceding requirements as an Unrestricted Subsidiary, it will thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture and any
Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted
Subsidiary of the Company as of such date and, if such Indebtedness is not
permitted to be incurred as of such date under Section 4.09, the Company will be
in default of such covenant. The Board of Directors of the Company may at any
time designate any Unrestricted Subsidiary to be a Restricted Subsidiary;
provided that such designation will be deemed to be an incurrence of
Indebtedness by one of the Company's Restricted Subsidiaries of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation will only be
permitted if (1) such Indebtedness is permitted under Section 4.09, calculated
on a pro forma basis as if such designation had occurred at the beginning of the
four-quarter reference period; (2) no Default or Event of Default would be in
existence following such designation; and (3) such Subsidiary executes and
delivers to the Trustee a supplemental indenture providing for a Subsidiary
Guarantee.
16
"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
Indebtedness at any date, the number of years obtained by dividing:
(1) 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
of the Indebtedness, 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
(2) the then outstanding principal amount of such Indebtedness.
Section 1.02. OTHER DEFINITIONS.
Defined in
Term Section
- --------------------------------------------------------------------------- -------
"Affiliate Transaction".................................................... 4.14
"Asset Sale Offer"......................................................... 3.09
"Authentication Order"..................................................... 2.02
"Benefited Party".......................................................... 10.01
"Change of Control Offer".................................................. 4.18
"Change of Control Purchase Price"......................................... 4.18
"Covenant Defeasance"...................................................... 8.03
"DTC"...................................................................... 2.03
"Event of Default"......................................................... 6.01
"Excess Proceeds".......................................................... 4.12
"incur".................................................................... 4.09
"Legal Defeasance"......................................................... 8.02
"losses"................................................................... 7.07
"Offer Amount"............................................................. 3.09
"Offer Period"............................................................. 3.09
"pay the Notes"............................................................ 12.03
"Paying Agent"............................................................. 2.03
"Payment Blockage Notice".................................................. 12.03
"Payment Blockage Period".................................................. 12.03
"Payment Default".......................................................... 6.01
"Permitted Debt"........................................................... 4.09
"Purchase Date"............................................................ 3.09
"Registrar"................................................................ 2.03
"Restricted Payments"...................................................... 4.10
"Security Register"........................................................ 4.18
Section 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
(a) Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
(b) The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Notes and the Subsidiary
Guarantees;
"indenture security holder" means a Holder of a Note;
"indenture to be qualified" means this Indenture;
17
"indenture trustee" or "institutional trustee" means the Trustee;
and
"obligor" on the Notes means the Company and any successor obligor
upon the Notes.
(c) All other terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule under
the TIA have the meanings so assigned to them.
Section 1.04. RULES OF CONSTRUCTION.
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined herein has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and in the plural
include the singular;
(v) all references in this instrument to designated "Articles,"
"Sections" and other subdivisions are to the designated Articles, Sections
and subdivisions of this instrument as originally executed;
(vi) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
(vii) "including" means "including without limitation";
(viii) provisions apply to successive events and transactions; and
(ix) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement or successor sections or
rules adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
Section 2.01. FORM AND DATING.
(a) GENERAL. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto, which is
hereby incorporated in and expressly made part of this Indenture. The Notes may
have notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof. The terms and
provisions contained in the Notes shall constitute, and are hereby expressly
made, a part of this Indenture and the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby. However, to the extent any provision of any
Note conflicts with the express provisions of this Indenture, the provisions of
this Indenture shall govern and be controlling.
(b) FORM OF NOTES. The Notes shall be issued initially in global
form and shall be substantially in the form of Exhibit A attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued in definitive form
shall be substantially in the form of Exhibit A attached hereto (but without the
Global Note Legend thereon and without the "Schedule of Exchanges of Interests
in the Global Note" attached thereto). Each Global Note shall represent such of
the outstanding Notes as shall be specified therein and each shall provide that
it shall represent the aggregate principal amount of outstanding Notes from time
to time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented
18
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges and redemptions. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the
Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06 hereof.
(c) BOOK-ENTRY PROVISIONS. This Section 2.01(c) shall only apply to
Global Notes deposited with the Trustee, as custodian for the Depositary.
Participants and Indirect Participants shall have no rights under this Indenture
with respect to any Global Note held on their behalf by the Depositary or by the
Trustee as the custodian for the Depositary or under such Global Note, and the
Depositary shall be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner of such Global Note for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its Participants or
Indirect Participants, the Applicable Procedures or the operation of customary
practices of the Depositary governing the exercise of the rights of a holder of
a beneficial interest in any Global Note.
Section 2.02. EXECUTION AND AUTHENTICATION.
(a) One Officer shall sign the Notes for the Company by manual or
facsimile signature.
(b) If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
(c) A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
(d) The Trustee shall, upon a written order of the Company signed by
an Officer (an "AUTHENTICATION ORDER"), authenticate Notes for original issue.
(e) The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.
(f) The Company may issue Additional Notes from time to time after
the offering of the Initial Notes. The Initial Notes, the Exchange Notes and any
Additional Notes subsequently issued under this Indenture shall be treated as a
single class for all purposes under this Indenture, including, without
limitation, waivers, amendments, redemptions and offers to purchase.
Section 2.03. REGISTRAR AND PAYING AGENT.
(a) The Company shall maintain an office or agency where Notes may
be presented for registration of transfer or for exchange ("REGISTRAR") and an
office or agency where Notes may be presented for payment ("PAYING AGENT"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.
(b) The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Notes.
19
(c) The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes.
Section 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee
to agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest and Additional Interest, if any, on the
Notes, and shall notify the Trustee of any default by the Company in making any
such payment. While any such default continues, the Trustee may require a Paying
Agent to pay all money held by it to the Trustee. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee. Upon payment
over to the Trustee, the Paying Agent (if other than the Company or a
Subsidiary) shall have no further liability for the money. If the Company or a
Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Holders all money held by it as Paying Agent. Upon
any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as Paying Agent for the Notes.
Section 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section. 312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing, a list in such form and as of such date or such
shorter time as the Trustee may allow, as the Trustee may reasonably require of
the names and addresses of the Holders and the Company shall otherwise comply
with TIA Section. 312(a).
Section 2.06. TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. All Global Notes will be exchanged by
the Company for Definitive Notes if (1) the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by the
Company within 120 days after the date of such notice from the Depositary; or
(2) an Event of Default shall have occurred and be continuing. Upon the
occurrence of any of the preceding events in (1) or (2) above, Definitive Notes
shall be issued in denominations of $1,000 or integral multiples thereof and in
such names as the Depositary shall instruct the Trustee. Global Notes also may
be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Every Note authenticated and delivered in exchange for, or in lieu
of, a Global Note or any portion thereof, pursuant to this Section 2.06 or
Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.
(b) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN THE GLOBAL
NOTES. The transfer and exchange of beneficial interests in the Global Notes
shall be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. Beneficial interests in the
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.
Transfers of beneficial interests in the Global Notes also shall require
compliance with either clause (i) or (ii) below, as applicable, as well as one
or more of the other following clauses, as applicable:
(i) Transfer of Beneficial Interests in the Same Global Note.
Beneficial interests in any Restricted Global Note may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend; provided, however,
that prior to the expiration of the Distribution Compliance Period,
transfers of beneficial interests in the Regulation S Global Note may not
be made to a U.S. Person
20
or for the account or benefit of a U.S. Person (other than an Initial
Purchaser). Beneficial interests in any Unrestricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note. No written orders or
instructions shall be required to be delivered to the Registrar to effect
the transfers described in this Section 2.06(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Notes. In connection with all transfers and exchanges of beneficial
interests that are not subject to Section 2.06(b)(i) above, the transferor
of such beneficial interest must deliver to the Registrar either (A)(1) a
written order from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial interest in
another Global Note in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the Participant
account to be credited with such increase or (B)(1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
cause to be issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions given by the
Depositary to the Registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to effect the transfer
or exchange referred to in (B)(1) above. Upon consummation of an Exchange
Offer by the Company in accordance with Section 2.06(f) hereof, the
requirements of this Section 2.06(b)(ii) shall be deemed to have been
satisfied upon receipt by the Registrar of the instructions contained in
the Letter of Transmittal delivered by the Holder of such beneficial
interests in the Restricted Global Notes. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests in Global
Notes contained in this Indenture and the Notes or otherwise applicable
under the Securities Act, the Trustee shall adjust the principal amount of
the relevant Global Note(s) pursuant to Section 2.06(h) hereof.
(iii) Transfer of Beneficial Interests in a Restricted Global Note to
Another Restricted Global Note. A beneficial interest in any Restricted
Global Note may be transferred to a Person who takes delivery thereof in
the form of a beneficial interest in another Restricted Global Note if the
transfer complies with the requirements of Section 2.06(b)(ii) above and
the Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 144A Global Note, then the transferor
must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof;
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Global Note, then the
transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (2) thereof; and
(C) if the transferee will take delivery in the form of a
beneficial interest in the IAI Global Note, then the transferor must
deliver a certificate in the form of Exhibit B hereto, including the
certifications and certificates and Opinion of Counsel required by
item (3) thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in an Unrestricted Global Note. A
beneficial interest in any Restricted Global Note may be exchanged by any
holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note if the exchange or
transfer complies with the requirements of Section 2.06(b)(ii) above and:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of the beneficial interest to be transferred, in the
case of an exchange, or the transferee, in the case of a transfer,
certifies in the applicable Letter of Transmittal that it is not (1)
a broker-dealer, (2) a Person participating in the distribution of
the Exchange Notes or (3) a Person who is an affiliate (as defined
in Rule 144) of the Company;
21
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
beneficial interest in an Unrestricted Global Note, a certificate
from such holder in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(2) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a
Person who shall take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Note, a certificate from such
holder in the form of Exhibit B hereto, including the certifications
in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar and the Company so requests or if the Applicable
Procedures so require, an Opinion of Counsel in form reasonably
acceptable to the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
If any such transfer is effected pursuant to clause (B) or (D) above
at a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to clause (B) or (D) above.
(v) Transfer or Exchange of Beneficial Interests in Unrestricted Global
Notes for Beneficial Interests in Restricted Global Notes Prohibited.
Beneficial interests in an Unrestricted Global Note cannot be exchanged
for, or transferred to Persons who take delivery thereof in the form of, a
beneficial interest in a Restricted Global Note.
(c) TRANSFER OR EXCHANGE OF BENEFICIAL INTERESTS FOR DEFINITIVE
NOTES.
(i) Beneficial Interests in Restricted Global Notes to Restricted
Definitive Notes. If any holder of a beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Restricted Definitive Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for a
Restricted Definitive Note, a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item
(2)(a) thereof;
(B) if such beneficial interest is being transferred to a QIB
in accordance with Rule 144A, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
22
(D) if such beneficial interest is being transferred pursuant
to an exemption from the registration requirements of the Securities
Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from
the registration requirements of the Securities Act other than those
listed in clauses (B) through (D) above, a certificate to the effect
set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)(d) thereof,
if applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such beneficial interest is being transferred pursuant
to an effective registration statement under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including
the certifications in item (3)(c) thereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions a Definitive Note in
the appropriate principal amount. Any Definitive Note issued in exchange
for a beneficial interest in a Restricted Global Note pursuant to this
Section 2.06(c) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such beneficial
interest shall instruct the Registrar through instructions from the
Depositary and the Participant or Indirect Participant. The Trustee shall
mail or deliver such Definitive Notes to the Persons in whose names such
Notes are so registered. Any Definitive Note issued in exchange for a
beneficial interest in a Restricted Global Note pursuant to this Section
2.06(c)(i) shall bear the Private Placement Legend and shall be subject to
all restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes to Unrestricted
Definitive Notes. A holder of a beneficial interest in a Restricted Global
Note may exchange such beneficial interest for an Unrestricted Definitive
Note or may transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the holder of such beneficial interest, in the case of an
exchange, or the transferee, in the case of a transfer, certifies in
the applicable Letter of Transmittal that it is not (1) a
broker-dealer, (2) a Person participating in the distribution of the
Exchange Notes or (3) a Person who is an affiliate (as defined in
Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the holder of such beneficial interest in a Restricted
Global Note proposes to exchange such beneficial interest for an
Unrestricted Definitive Note, a certificate from such holder in the
form of Exhibit C hereto, including the certifications in item
(1)(b) thereof; or
23
(2) if the holder of such beneficial interest in a Restricted
Global Note proposes to transfer such beneficial interest to a
Person who shall take delivery thereof in the form of an
Unrestricted Definitive Note, a certificate from such holder in the
form of Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted
Definitive Notes. If any holder of a beneficial interest in an
Unrestricted Global Note proposes to exchange such beneficial interest for
a Definitive Note or to transfer such beneficial interest to a Person who
takes delivery thereof in the form of a Definitive Note, then, upon
satisfaction of the conditions set forth in Section 2.06(b)(ii) hereof,
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.06(h) hereof,
and the Company shall execute and the Trustee shall authenticate and mail
or deliver to the Person designated in the instructions a Definitive Note
in the appropriate principal amount. Any Definitive Note issued in
exchange for a beneficial interest pursuant to this Section 2.06(c)(iii)
shall be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial interest
shall instruct the Registrar through instructions from the Depositary and
the Participant or Indirect Participant. The Trustee shall mail or deliver
such Definitive Notes to the Persons in whose names such Notes are so
registered. Any Definitive Note issued in exchange for a beneficial
interest pursuant to this Section 2.06(c)(iii) shall not bear the Private
Placement Legend.
(d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR BENEFICIAL
INTERESTS.
(i) Restricted Definitive Notes to Beneficial Interests in Restricted
Global Notes. If any Holder of a Restricted Definitive Note proposes to
exchange such Note for a beneficial interest in a Restricted Global Note
or to transfer such Restricted Definitive Notes to a Person who takes
delivery thereof in the form of a beneficial interest in a Restricted
Global Note, then, upon receipt by the Registrar of the following
documentation:
(A) if the Holder of such Restricted Definitive Note proposes
to exchange such Note for a beneficial interest in a Restricted
Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Note is being transferred to
a QIB in accordance with Rule 144A, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (1)
thereof;
(C) if such Restricted Definitive Note is being transferred to
a Non-U.S. Person in an offshore transaction in accordance with Rule
903 or Rule 904, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2) thereof;
(D) if such Restricted Definitive Note is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144, a certificate to the
effect set forth in Exhibit B hereto, including the certifications
in item (3)(a) thereof;
(E) if such Restricted Definitive Note is being transferred to
an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than
those listed in clauses (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3)(d) thereof,
if applicable;
24
(F) if such Restricted Definitive Note is being transferred to
the Company or any of its Subsidiaries, a certificate to the effect
set forth in Exhibit B hereto, including the certifications in item
(3)(b) thereof; or
(G) if such Restricted Definitive Note is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
the Trustee shall cancel the Restricted Definitive Note, increase or cause
to be increased the aggregate principal amount of, in the case of clause
(A) above, the appropriate Restricted Global Note, in the case of clause
(B) above, the 144A Global Note, in the case of clause (C) above, the
Regulation S Global Note, and in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of a Restricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Restricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note only if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the Company;
(B) such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
(C) such transfer is effected by a broker-dealer pursuant to
the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Definitive Notes proposes to
exchange such Notes for a beneficial interest in the Unrestricted
Global Note, a certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (1)(c) thereof; or
(2) if the Holder of such Definitive Notes proposes to
transfer such Notes to a Person who shall take delivery thereof in
the form of a beneficial interest in the Unrestricted Global Note, a
certificate from such Holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Registrar to
the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained
herein and in the Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the clauses in this
Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes and
increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial Interests in
Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note may
exchange such Note for a beneficial interest in an Unrestricted Global
Note or transfer such Unrestricted Definitive Note to a Person who takes
delivery
25
thereof in the form of a beneficial interest in an Unrestricted Global
Note at any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Unrestricted Definitive
Note and increase or cause to be increased the aggregate principal amount
of one of the Unrestricted Global Notes.
(iv) Transfer or Exchange of Unrestricted Definitive Notes to
Beneficial Interests in Restricted Global Notes Prohibited. An
Unrestricted Definitive Note cannot be exchanged for, or transferred to
Persons who take delivery thereof in the form of, beneficial interests in
a Restricted Global Note.
(v) Issuance of Unrestricted Global Notes. If any such exchange or
transfer from a Definitive Note to a beneficial interest is effected
pursuant to clauses (ii)(B), (ii)(D) or (iii) above at a time when an
Unrestricted Global Note has not yet been issued, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section
2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the principal
amount of Definitive Notes so transferred.
(e) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR DEFINITIVE NOTES.
Upon request by a Holder of Definitive Notes and such Holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).
(i) Restricted Definitive Notes to Restricted Definitive Notes. Any
Restricted Definitive Note may be transferred to and registered in the
name of Persons who take delivery thereof in the form of a Restricted
Definitive Note if the Registrar receives the following:
(A) if the transfer will be made pursuant to Rule 144A, then
the transferor must deliver a certificate in the form of Exhibit B
hereto, including the certifications in item (1) thereof;
(B) if the transfer will be made pursuant to Rule 903 or Rule
904, then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in item (2) thereof;
and
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications, certificates and
Opinion of Counsel required by item (3) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted Definitive Notes. Any
Restricted Definitive Note may be exchanged by the Holder thereof for an
Unrestricted Definitive Note or transferred to a Person or Persons who
take delivery thereof in the form of an Unrestricted Definitive Note if:
(A) such exchange or transfer is effected pursuant to the
Exchange Offer in accordance with the Registration Rights Agreement
and the Holder, in the case of an exchange, or the transferee, in
the case of a transfer, certifies in the applicable Letter of
Transmittal that it is not (1) a broker-dealer, (2) a Person
participating in the distribution of the Exchange Notes or (3) a
Person who is an affiliate (as defined in Rule 144) of the Company;
(B) any such transfer is effected pursuant to the Shelf
Registration Statement in accordance with the Registration Rights
Agreement;
26
(C) any such transfer is effected by a broker-dealer pursuant
to the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement; or
(D) the Registrar receives the following:
(1) if the Holder of such Restricted Definitive Notes proposes
to exchange such Notes for an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(d) thereof; or
(2) if the Holder of such Restricted Definitive Notes proposes
to transfer such Notes to a Person who shall take delivery thereof
in the form of an Unrestricted Definitive Note, a certificate from
such Holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this clause (D), if the
Registrar so requests, an Opinion of Counsel in form reasonably
acceptable to the Registrar and the Company to the effect that such
exchange or transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes. A
Holder of Unrestricted Definitive Notes may transfer such Notes to a
Person who takes delivery thereof in the form of an Unrestricted
Definitive Note. Upon receipt of a request to register such a transfer,
the Registrar shall register the Unrestricted Definitive Notes pursuant to
the instructions from the Holder thereof.
(f) EXCHANGE OFFER. Upon the occurrence of the Exchange Offer in
accordance with the Registration Rights Agreement, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate (A) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates (as defined in Rule 144) of the Company,
and accepted for exchange in the Exchange Offer and (B) Unrestricted Definitive
Notes in an aggregate principal amount equal to the principal amount of the
Restricted Definitive Notes tendered for acceptance by Persons who made the
foregoing certification and accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and mail or deliver to the Persons designated by the Holders of
Restricted Definitive Notes so accepted Unrestricted Definitive Notes in the
appropriate principal amount.
(g) LEGENDS. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.
(i) Private Placement Legend.
(A) Except as permitted by clause (B) below, each Global Note
and each Definitive Note (and all Notes issued in exchange therefor
or substitution thereof) shall bear the legend in substantially the
following form:
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, IN THE ABSENCE OF SUCH
REGISTRATION UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS
ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN
27
RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO (A)
THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE
144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR
THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WERE THE
OWNERS OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (B) SUCH LATER DATE,
IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION
TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (I) TO
THE COMPANY, (II) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (III) FOR SO LONG AS THE NOTES 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 FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (IV) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS
THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER
THE SECURITIES ACT OR (V) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE
TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE, AND THE REGISTRAR
SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (IV) OR (V) TO REQUIRE THAT AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR
OTHER INFORMATION SATISFACTORY TO THE COMPANY, THE TRUSTEE AND THE REGISTRAR IS
COMPLETED AND DELIVERED BY THE TRANSFEROR. THIS LEGEND WILL BE REMOVED UPON THE
REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED
HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE
THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
(B) Notwithstanding the foregoing, any Global Note or
Definitive Note issued pursuant to clauses (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this
Section 2.06 (and all Notes issued in exchange therefor or
substitution thereof) shall not bear the Private Placement Legend.
(ii) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE COMPANY.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN."
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(h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such time as
all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Company
shall execute and, upon receipt of an Authentication Order in accordance
with Section 2.02, the Trustee shall authenticate Global Notes and
Definitive Notes upon the Company's order or at the Registrar's request.
(ii) No service charge shall be made to a Holder of a beneficial
interest in a Global Note or to a Holder of a Definitive Note for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes
or similar governmental charge payable upon exchange or transfer pursuant
to Sections 2.10, 3.06, 4.12, 4.18 and 9.05 hereof).
(iii) All Global Notes and Definitive Notes issued upon any
registration of transfer or exchange of Global Notes or Definitive Notes
shall be the valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Global
Notes or Definitive Notes surrendered upon such registration of transfer
or exchange.
(iv) Neither the Registrar nor the Company shall be required (A) to
issue, to register the transfer of or to exchange any Notes during a
period beginning at the opening of business 15 days before the day of any
selection of Notes for redemption under Section 3.02 hereof and ending at
the close of business on the day of selection, (B) to register the
transfer of or to exchange any Note so selected for redemption in whole or
in part, except the unredeemed portion of any Note being redeemed in part
or (C) to register the transfer of or to exchange a Note between a record
date and the next succeeding Interest Payment Date.
(v) Prior to due presentment for the registration of a transfer of any
Note, the Trustee, any Agent and the Company may deem and treat the Person
in whose name any Note is registered as the absolute owner of such Note
for the purpose of receiving payment of principal of and interest on such
Notes and for all other purposes, and none of the Trustee, any Agent or
the Company shall be affected by notice to the contrary.
(vi) The Trustee shall authenticate Global Notes and Definitive Notes
in accordance with the provisions of Section 2.02 hereof.
(vii) All certifications, certificates and Opinions of Counsel required
to be submitted to the Registrar pursuant to this Section 2.06 to effect a
registration of transfer or exchange may be submitted by facsimile.
(viii) The Trustee is hereby authorized to enter into a letter of
representation with the Depositary in the form provided by the Company and
to act in accordance with such letter.
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Section 2.07. REPLACEMENT NOTES.
If any mutilated Note is surrendered to the Trustee or the Company
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Note, the Company shall issue and the Trustee, upon receipt of
an Authentication Order, shall authenticate a replacement Note if the Trustee's
requirements are met. If required by the Trustee or the Company, an indemnity
bond must be supplied by the Holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced. The Company may charge for its expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company
and shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Notes duly issued hereunder.
Section 2.08. OUTSTANDING NOTES.
(a) The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section 2.08 as not outstanding. Except as set forth in
Section 2.09 hereof, a Note does not cease to be outstanding because the Company
or an Affiliate of the Company holds the Note; however, Notes held by the
Company or a Subsidiary of the Company shall not be deemed to be outstanding for
purposes of Section 3.07(b) hereof.
(b) If a Note is replaced pursuant to Section 2.07 hereof, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced note is held by a bona fide purchaser.
(c) If the principal amount of any Note is considered paid under
Section 4.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
(d) If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date or maturity date, money
sufficient to pay Notes payable on that date, then on and after that date such
Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.
Section 2.09. TREASURY NOTES.
In determining whether the Holders of the required principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Company, shall be considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.
Section 2.10. TEMPORARY NOTES.
Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order,
shall authenticate temporary Notes. Temporary Notes shall be substantially in
the form of certificated Notes but may have variations that the Company
considers appropriate for temporary Notes and as shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate Definitive Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits
of this Indenture.
Section 2.11. CANCELLATION.
The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee upon direction by the Company and no one else shall cancel all Notes
surrendered for
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registration of transfer, exchange, payment, replacement or cancellation and
shall destroy cancelled Notes (subject to the record retention requirements of
the Exchange Act). Certification of the destruction of all cancelled Notes shall
be delivered to the Company. The Company may not issue new Notes to replace
Notes that it has paid or that have been delivered to the Trustee for
cancellation.
Section 2.12. DEFAULTED INTEREST.
If the Company defaults in a payment of interest or Additional
Interest, if any, on the Notes, it shall pay the defaulted interest in any
lawful manner plus, to the extent lawful, interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date, in
each case at the rate provided in the Notes and in Section 4.01 hereof. The
Company shall notify the Trustee in writing of the amount of defaulted interest
proposed to be paid on each Note and the date of the proposed payment. The
Company shall fix or cause to be fixed each such special record date and payment
date, provided that no such special record date shall be less than 10 days prior
to the related payment date for such defaulted interest. At least 15 days before
the special record date, the Company (or, upon the written request of the
Company, the Trustee in the name and at the expense of the Company) shall mail
or cause to be mailed to Holders a notice that states the special record date,
the related payment date and the amount of such interest to be paid.
Section 2.13. CUSIP OR ISIN NUMBERS.
The Company in issuing the Notes may use "CUSIP" or "ISIN" numbers
(if then generally in use), and, if so, the Trustee shall use "CUSIP" or "ISIN"
numbers in notices of redemption as a convenience to Holders; provided, however,
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the "CUSIP" or "ISIN" numbers.
Section 2.14. ADDITIONAL INTEREST.
If Additional Interest is payable by the Company pursuant to the
Registration Rights Agreement and paragraph 1 of the Notes, the Company shall
deliver to the Trustee a certificate to that effect stating (i) the amount of
such Additional Interest that is payable and (ii) the date on which such
interest is payable. Unless and until a Responsible Officer of the Trustee
receives such a certificate or instruction or direction from the Holders in
accordance with the terms of the Indenture, the Trustee may assume without
inquiry that no Additional Interest is payable. The foregoing shall not
prejudice the rights of the Holders with respect to their entitlement to
Additional Interest as otherwise set forth in this Indenture or the Notes and
pursuing any action against the Company directly or otherwise directing the
Trustee to take any such action in accordance with the terms of this Indenture
and the Notes. If the Company has paid Additional Interest directly to the
persons entitled to it, the Company shall deliver to the Trustee a certificate
setting forth the particulars of such payment.
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ARTICLE 3.
REDEMPTION AND PREPAYMENT
Section 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Notes to be redeemed and (iv) the redemption price.
Section 3.02. SELECTION OF NOTES TO BE REDEEMED.
If less than all of the Notes are to be redeemed at any time, the
Trustee shall select the Notes to be redeemed among the Holders of the Notes in
compliance with the requirements of the principal national securities exchange,
if any, on which the Notes are listed or, if the Notes are not so listed, on a
pro rata basis, by lot or in accordance with any other method the Trustee
considers fair and appropriate. In the event of partial redemption by lot, the
particular Notes to be redeemed shall be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption date by
the Trustee from the outstanding Notes not previously called for redemption.
The Trustee shall promptly notify the Company in writing of the
Notes selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000;
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date,
the Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days prior to
a redemption date if the notice is issued in connection with a defeasance of the
Notes pursuant to Article 8 hereof or a satisfaction and discharge of this
Indenture pursuant to Article 11.
The notice shall identify the Notes to be redeemed and shall
state:
(a) the redemption date;
(b) the redemption price or if the redemption is made pursuant to
Section 3.07(b) a calculation of the redemption price;
(c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(f) that, unless the Company defaults in making such redemption
payment, interest and Additional Interest, if any, on Notes called for
redemption ceases to accrue on and after the redemption date;
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(g) the paragraph of the Notes or Section of this Indenture pursuant
to which the Notes called for redemption are being redeemed; and
(h) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days, or such shorter
period allowed by the Trustee, prior to the redemption date, an Officers'
Certificate requesting that the Trustee give such notice and setting forth the
information to be stated in such notice as provided in this Section 3.03.
Section 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price. A notice of redemption may not be
conditional.
Section 3.05. DEPOSIT OF REDEMPTION PRICE.
On or before 11:00 a.m. on any redemption date, the Company shall
deposit with the Trustee or with the Paying Agent money sufficient to pay the
redemption price of and accrued interest and Additional Interest, if any, on all
Notes to be redeemed on that date. The Trustee or the Paying Agent shall
promptly return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued interest and Additional Interest, if any, on,
all Notes to be redeemed.
If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest and Additional Interest,
if any, shall cease to accrue on the Notes or the portions of Notes called for
redemption. If a Note is redeemed on or after an interest record date but on or
prior to the related Interest Payment Date, then any accrued and unpaid interest
shall be paid to the Person in whose name such Note was registered at the close
of business on such record date. If any Note called for redemption shall not be
so paid upon surrender for redemption because of the failure of the Company to
comply with the preceding paragraph, interest and Additional Interest, if any,
shall be paid on the unpaid principal from the redemption date until such
principal is paid, and to the extent lawful on any interest not paid on such
unpaid principal, in each case at the rate provided in the Notes and in Section
4.01 hereof.
Section 3.06. NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.
Section 3.07. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Section 3.07, the
Notes will not be redeemable at the option of the Company prior to May 1, 2009.
Starting on May 1, 2009, the Company may redeem all or a part of the Notes after
giving the required notice under this Indenture. The Notes may be redeemed at
the redemption prices (expressed as percentages of principal amount) set forth
below, plus accrued and unpaid interest and Additional Interest, if any, on the
Notes redeemed, to the applicable redemption date (subject to the right of
Holders on the relevant record date to receive interest due on the relevant
Interest Payment Date), if redeemed during the twelve-month period beginning on
May 1 of the years indicated below:
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Year Percentage
- ------------------------------------------------------------------------------- ----------
2009........................................................................... 103.438%
2010........................................................................... 102.292%
2011........................................................................... 101.146%
2012 and thereafter............................................................ 100.000%
(b) At any time and from time to time prior to May 1, 2007, the
Company may redeem up to 35% of the aggregate principal amount of the Notes
issued under this Indenture at a redemption price equal to 106.875% of the
principal amount thereof, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
Interest Payment Date) with the net cash proceeds of any Qualified Equity
Offering; provided, however, that after giving effect to any such redemption, at
least 65% of the aggregate principal amount of the Notes issued under this
Indenture (excluding Notes held by the Company and its Subsidiaries) remains
outstanding immediately after the occurrence of such redemption. Any such
redemption shall be made within 120 days of the closing of such Qualified Equity
Offering.
(c) Any prepayment pursuant to this Section 3.07 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof.
Section 3.08. MANDATORY REDEMPTION.
The Company shall not be required to make mandatory redemption or
sinking fund payments with respect to the Notes.
Section 3.09. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS
(a) In the event that, pursuant to Section 4.12 hereof, the Issuer
shall be required to commence an offer to all Holders to purchase Notes (an
"Asset Sale Offer"), it shall follow the procedures specified below.
(b) The Asset Sale Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "Offer Period"). No
later than five Business Days after the termination of the Offer Period (the
"PURCHASE DATE"), the Issuer shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.12 hereof (the "OFFER AMOUNT")
or, if less than the Offer Amount has been tendered, all Notes tendered in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.
If the Purchase Date is on or after an interest record date and on
or before the related Interest Payment Date, any accrued and unpaid interest
shall be paid to the Person in whose name a Note is registered at the close of
business on such record date, and no additional interest shall be payable to
Holders who tender Notes pursuant to the Asset Sale Offer.
Upon the commencement of the Asset Sale Offer, the Issuer shall
send, by first class mail, a notice to the Trustee and each of the Holders, with
a copy to the Trustee. The notice shall contain all instructions and materials
necessary to enable such Holders to tender Notes pursuant to the Asset Sale
Offer. The Asset Offer shall be made to all Holders. The notice, which shall
govern the terms of the Asset Sale Offer, shall state:
(i) that the Asset Sale Offer is being made pursuant to this Section
3.09 and Section 4.12 hereof and the length of time the Asset Sale Offer
shall remain open;
(ii) the Offer Amount, the purchase price and the Purchase Date;
(iii) that any Note not tendered or accepted for payment shall continue
to accrue interest;
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(iv) that, unless the Issuer defaults in making such payment, any Note
accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest and Additional Interest, if any, after the Purchase Date;
(v) that Holders electing to have a Note purchased pursuant to an Asset
Sale Offer may elect to have Notes purchased in integral multiples of
$1,000 only;
(vi) that Holders electing to have a Note purchased pursuant to any
Asset Sale Offer shall be required to surrender the Note, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Note
completed, or transfer by book-entry transfer, to the Issuer, a
depositary, if appointed by the Issuer, or a Paying Agent at the address
specified in the notice at least three days before the Purchase Date;
(vii) that Holders shall be entitled to withdraw their election if the
Issuer, the depositary or the Paying Agent, as the case may be, receives,
not later than the expiration of the Offer Period, a telegram, facsimile
transmission or letter setting forth the name of the Holder, the principal
amount of the Note the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Note purchased;
(viii) that, if the aggregate principal amount of Notes surrendered by
Holders exceeds the Offer Amount, the Issuer shall select the Notes to be
purchased on a pro rata basis (with such adjustments as may be deemed
appropriate by the Issuer so that only Notes in denominations of $1,000 or
integral multiples thereof shall be purchased); and
(ix) that Holders whose Notes were purchased only in part shall be
issued new Notes equal in principal amount to the unpurchased portion of
the Notes surrendered (or transferred by book-entry transfer).
On or before the Purchase Date, the Issuer shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary, the
Offer Amount of Notes or portions thereof tendered pursuant to the Asset Sale
Offer, or if less than the Offer Amount has been tendered, all Notes tendered,
and shall deliver to the Trustee an Officers' Certificate stating that such
Notes or portions thereof were accepted for payment by the Issuer in accordance
with the terms of this Section 3.09. The Issuer, the Depositary or the Paying
Agent, as the case may be, shall promptly (but in any case not later than five
Business Days after the Purchase Date) mail or deliver to each tendering Holder
an amount equal to the purchase price of the Notes tendered by such Holder and
accepted by the Issuer for purchase, and the Issuer shall promptly issue a new
Note, and the Trustee, upon written request from the Issuer shall authenticate
and mail or deliver such new Note to such Holder, in a principal amount equal to
any unpurchased portion of the Note surrendered. Any Note not so accepted shall
be promptly mailed or delivered by the Issuer to the Holder thereof. The Issuer
shall publicly announce the results of the Asset Sale Offer on the Purchase
Date.
Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Section 3.01 through 3.06 hereof.
ARTICLE 4.
COVENANTS
Section 4.01. PAYMENT OF NOTES.
The Company shall pay or cause to be paid the principal of, premium,
if any, and interest on the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest and Additional Interest, if any,
shall be considered paid on the date due if the Paying Agent, if other than the
Company or a Subsidiary thereof, holds as of 11:00 a.m. Eastern Time on the due
date money deposited by the Company in immediately available funds and
designated for and sufficient to pay all principal, premium, if any, and
interest and
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Additional Interest, if any, then due. The Company shall pay Additional
Interest, if any, in the same manner, on the dates and in the amounts set forth
in the Registration Rights Agreement.
The Company shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal and premium, if
any, from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect; it shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue installments of interest and
Additional Interest, if any, (without regard to any applicable grace periods)
from time to time on demand at the same rate to the extent lawful.
Interest shall be computed on the basis of a 360-day year of twelve
30-day months.
Section 4.02. MAINTENANCE OF OFFICE OR AGENCY.
(a) The Company shall maintain an office or agency (which may be an
office or drop facility of the Trustee or an affiliate of the Trustee, Registrar
or co-registrar) where Notes may be presented or surrendered for registration of
transfer or for exchange and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office of the Trustee, and the
Company hereby appoints the Trustee as its agent to receive all such
presentations, surrenders, notices and demands.
(b) The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations.
The Company shall give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.
(c) The Company hereby designates the Corporate Trust Office of the
Trustee, as one such office, drop facility or agency of the Company in
accordance with Section 2.03.
Section 4.03. REPORTS.
(a) Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, so long as
any Notes are outstanding the Company shall furnish to the Trustee and Holders
of the Notes, within the time periods specified in the SEC's rules and
regulations:
(i) all quarterly and annual financial information that would be
required to be contained in a filing with the SEC on Forms 10-Q and 10-K
if the Company were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
and, with respect to the annual information only, a report on the annual
financial statements by the Company's certified independent accountants;
and
(ii) all current reports that would be required to be filed with the
SEC on Form 8-K if the Company were required to file such reports.
(b) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding clause (a) will include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and in "Management's Discussion and Analysis of Financial Condition and
Results of Operations," of the financial condition and results of operations of
the Company and its Restricted Subsidiaries separate from the financial
condition and results of operations of the Company's Unrestricted Subsidiaries.
(c) In addition, following the consummation of the Exchange Offer
contemplated by the Registration Rights Agreement, whether or not required by
the SEC, the Company shall file a copy of all of the information and reports
referred to in clauses (a)(i) and (a)(ii) above with the SEC for public
availability within the
36
time periods specified in the SEC's rules and regulations (unless the SEC will
not accept such a filing) and make such information available to securities
analysts and prospective investors upon request.
(d) The Company will be deemed to have furnished such reports to the
Trustee and Holders of Notes if the Company has filed such reports with the SEC
via the EDGAR filing system and such reports are publicly available.
(e) For so long as any Notes remain outstanding, the Company shall
furnish to the Holders and to securities analysts and prospective investors,
upon their request, the information required to be delivered pursuant to Rule
144A(d)(4) under the Securities Act.
Section 4.04. COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year, an Officers' Certificate stating that a review of
the activities of the Company and its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of
the American Institute of Certified Public Accountants, the year-end financial
statements delivered to the Trustee pursuant to Section 4.03 above shall be
accompanied by a written statement of the Company's independent public
accountants (who shall be a firm of established national reputation) that in
making the examination necessary for certification of such financial statements,
nothing has come to their attention that would lead them to believe that the
Company has violated any provisions of Articles 4 or 5 hereof or, if any such
violation has occurred, specifying the nature and period of existence thereof,
it being understood that such accountants shall not be liable directly or
indirectly to any Person for any failure to obtain knowledge of any such
violation.
(c) The Company shall deliver to the Trustee, within 30 days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of any event that with the giving of notice and the lapse of time would become
an Event of Default, its status and what action the Company is taking or
proposes to take with respect thereto.
Section 4.05. TAXES.
The Company shall pay, and shall cause each of its Restricted
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes; provided that
neither the Company nor any such Restricted Subsidiary shall be required to pay
or discharge, or cause to be paid or discharged, any such tax, assessment,
charge or claim the amount, applicability or validity of which is being
contested in good faith by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP.
Section 4.06. STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so)
that it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, that may affect the
covenants or the performance of this
37
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been enacted.
Section 4.07. CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses
and franchises of the Company and its Restricted Subsidiaries; provided,
however, that the Company shall not be required to preserve any such right,
license or franchise, or the corporate, partnership or other existence of any of
its Restricted Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes.
Section 4.08. PAYMENTS FOR CONSENT.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to or for the
benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid or is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
Section 4.09. INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
(a) The Company shall not, and shall 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
Indebtedness (including any Acquired Debt), and the Company shall not issue any
Disqualified Stock and shall not permit any of its Restricted Subsidiaries to
issue any shares of preferred stock; provided, however, that the Company may
incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and
any of the Subsidiary Guarantors may incur Indebtedness (including Acquired
Debt), if the Fixed Charge Coverage Ratio for the Company's most recently ended
four full fiscal quarters for which internal financial statements are available
immediately preceding the date on which such additional Indebtedness is incurred
or such Disqualified Stock is issued would have been at least 2.00 to 1,
determined on a pro forma basis (including a pro forma application of the net
proceeds therefrom), as if the additional Indebtedness had been incurred or the
preferred stock or Disqualified Stock had been issued, as the case may be, at
the beginning of such four-quarter period.
(b) Paragraph (a) of this Section 4.09 will not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"PERMITTED DEBT"):
(i) the incurrence by the Company of additional Indebtedness and
letters of credit under one or more Credit Facilities and Guarantees
thereof by the Subsidiary Guarantors; provided that the aggregate
principal amount of all Indebtedness of the Company and the Subsidiary
Guarantors incurred pursuant to this clause (i) (with letters of credit
being deemed to have a principal amount equal to the maximum potential
liability of the Company and the Subsidiary Guarantors thereunder) does
not exceed an amount equal to $200.0 million;
(ii) the incurrence by the Company and its Restricted Subsidiaries of
the Existing Indebtedness;
(iii) the incurrence by the Company of Indebtedness represented by the
Notes to be issued on the date hereof (and the related Exchange Notes to
be issued pursuant to the Registration Rights Agreement)
38
and the incurrence by the Subsidiary Guarantors of the Subsidiary
Guarantees of the Notes (and the related Exchange Notes);
(iv) the incurrence by the Company or any of the Subsidiary Guarantors
of Indebtedness represented by Capital Lease Obligations, mortgage
financings or purchase money obligations, in each case incurred for the
purpose of financing all or any part of the purchase price or cost of
construction or improvement of property, plant or equipment used in the
Company's business or the business of such Subsidiary Guarantor, in an
aggregate principal amount, including all Permitted Refinancing
Indebtedness incurred to refund, refinance or replace any Indebtedness
incurred pursuant to this clause (iv), not to exceed 5.0% of Consolidated
Tangible Assets at any time outstanding;
(v) the incurrence by the Company or any of its Restricted Subsidiaries
of Permitted Refinancing Indebtedness in exchange for, or the net proceeds
of which are used to refund, refinance or replace Indebtedness (other than
intercompany Indebtedness) that was incurred under clause (a) of this
Section 4.09 or clauses (ii), (iii) or (x) of this Section 4.09(b);
(vi) the incurrence by the Company or any of its Restricted
Subsidiaries of intercompany Indebtedness owed to the Company or any of
the Subsidiary Guarantors; provided, however, that:
(A) if the Company is the obligor on such Indebtedness, such
Indebtedness must be expressly subordinated to the prior payment in
full in cash of all Obligations with respect to the Notes;
(B) if a Subsidiary Guarantor is the obligor on such
Indebtedness, such Indebtedness is expressly subordinated to the
prior payment in full in cash of such Subsidiary Guarantor's
Subsidiary Guarantee; and
(C) (1) any subsequent issuance or transfer of Equity
Interests that results in any such Indebtedness being held by a
Person other than the Company or a Subsidiary Guarantor and (2) any
sale or other transfer of any such Indebtedness to a Person that is
not either the Company or a Subsidiary Guarantor shall be deemed, in
each case, to constitute an incurrence of such Indebtedness by the
Company or such Subsidiary Guarantor, as the case may be, that was
not permitted by this clause (vi);
(vii) the incurrence by the Company or any of its Restricted
Subsidiaries of Hedging Obligations that are incurred in the normal course
of business for the purpose of fixing or hedging currency, commodity or
interest rate risk (including with respect to any floating rate
Indebtedness that is permitted by the terms hereof to be outstanding in
connection with the conduct of the Company's respective businesses and not
for speculative purposes);
(viii) the guarantee by the Company or any of the Subsidiary Guarantors
of Indebtedness of the Company or of one of its Restricted Subsidiaries
that was permitted to be incurred by another provision of this covenant;
(ix) the incurrence by the Company's Unrestricted Subsidiaries of
Non-recourse Debt; provided, however, that if any such Indebtedness ceases
to be Non-recourse Debt of an Unrestricted Subsidiary, such event shall be
deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of
the Company that was not permitted by this clause (ix); and
(x) the incurrence by the Company or any of its Restricted Subsidiaries
of additional Indebtedness in an aggregate principal amount (or accreted
value, as applicable) at any time outstanding, including all Permitted
Refinancing Indebtedness incurred to refund, refinance or replace any
Indebtedness incurred pursuant to this clause (x), not to exceed $35.0
million (which amount may be incurred, in whole or in part, under any of
the Credit Facilities); provided that no more than $15.0 million of such
additional Indebtedness shall be incurred by Restricted Subsidiaries that
are not Subsidiary Guarantors.
39
(c) For purposes of determining compliance with this Section 4.09,
in the event that an item of proposed Indebtedness meets the criteria of more
than one of the categories of Permitted Debt described in clauses (i) through
(x) of Section 4.09(b) as of the date of incurrence thereof or is entitled to be
incurred pursuant to clause (a) of this Section 4.09, the Company shall, in its
sole discretion, at the time the proposed Indebtedness is incurred, (x) classify
all or a portion of that item of Indebtedness on the date of its incurrence
under either the clause (a) of this Section 4.09 or under any category of
Permitted Debt, (y) reclassify at a later date all or a portion of that or any
other item of Indebtedness as being or having been incurred in any manner that
complies with this Section 4.09 and (z) elect to comply with this Section 4.09
and the applicable definitions in any order.
(d) For purposes of determining compliance with any
dollar-denominated restriction on the incurrence of Indebtedness denominated in
a foreign currency, the dollar-equivalent principal amount of such Indebtedness
incurred pursuant thereto shall be calculated based on the relevant currency
exchange rate in effect on the date that such Indebtedness was incurred.
(e) The Company shall not incur, create, issue, assume, guarantee or
otherwise become liable for any Indebtedness that is subordinate or junior in
right of payment to any Senior Debt of the Company and senior in any respect in
right of payment to the Notes; provided, however, that no Indebtedness of the
Company will be deemed to be contractually subordinated in right of payment
solely by virtue of being unsecured. No Subsidiary Guarantor will incur, create,
issue, assume, guarantee or otherwise become liable for any Indebtedness that is
subordinate or junior in right of payment to the Senior Debt of such Subsidiary
Guarantor and senior in any respect in right of payment to such Subsidiary
Guarantor's Subsidiary Guarantee; provided, however, that no Indebtedness of a
Subsidiary Guarantor will be deemed to be contractually subordinated in right of
payment solely by virtue of being unsecured.
(f) Indebtedness shall be deemed to have been incurred by the
survivor of a merger, at the time of such merger and, with respect to an
acquired Subsidiary, at the time of such acquisition.
Section 4.10. RESTRICTED PAYMENTS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other payment or
distribution on account of the Company's Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation involving
the Company) or to the direct or indirect holders of the Company's Equity
Interests in their capacity as such (other than dividends or distributions
payable solely in the Company's Equity Interests (other than Disqualified Stock)
or to the Company);
(b) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the Company) any of the Company's Equity Interests;
(c) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value any Subordinated Indebtedness,
except (i) a payment of interest or principal at the Stated Maturity thereof or
(ii) Subordinated Indebtedness acquired in anticipation of satisfying a sinking
fund obligation, principal installment or payment of principal upon final
maturity of such Subordinated Indebtedness, in each case acquired within one
year of the date of the sinking fund obligation, principal installment or
payment of principal upon maturity; or
(d) make any Restricted Investment,
(all such payments and other actions set forth in these clauses (a) through (d)
above being collectively referred to as "RESTRICTED PAYMENTS"), unless, at the
time of and after giving effect to such Restricted Payment:
(a) no Default or Event of Default has occurred and is continuing or
would occur as a consequence of such Restricted Payment; and
40
(b) the Company 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 Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in Section 4.09(a); and
(c) such Restricted Payment, together with the aggregate amount of
all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date hereof (excluding Restricted Payments permitted by
clauses (2) and (3) of the next paragraph), is less than the sum, without
duplication, of:
(i) 50% of the Company's Consolidated Net Income for the period (taken
as one accounting period) from April 15, 2002 to the end of the Company's
most recently ended fiscal quarter for which internal financial statements
are available at the time of such Restricted Payment (or, if such
Consolidated Net Income for such period is a deficit, less 100% of such
deficit), plus
(ii) 100% of the aggregate net cash proceeds received by the Company
(including the fair market value of any Permitted Business or assets used
or useful in a Permitted Business to the extent acquired in consideration
of Equity Interests of the Company (other than Disqualified Stock)) since
the date hereof as a contribution to the Company's common equity capital
or from the issue or sale of Equity Interests of the Company (other than
Disqualified Stock)or from the issue or sale of convertible or
exchangeable Disqualified Stock or convertible or exchangeable debt
securities of the Company that have been converted into or exchanged for
such Equity Interests (other than Equity Interests (or Disqualified Stock
or debt securities) sold to a Subsidiary of the Company), plus
(iii) to the extent that any Restricted Investment that was made after
the date hereof is sold for cash or otherwise liquidated or repaid for
cash, the lesser of (1) the cash return of capital with respect to such
Restricted Investment (less the cost of disposition, if any) and (2) the
initial amount of such Restricted Investment.
So long as no Default has occurred and is continuing or would be
caused thereby, the preceding provisions will not prohibit:
(1) the payment of any dividend within 60 days after the date of
declaration of the dividend, if at the date of declaration the dividend payment
would have complied with the provisions hereof;
(2) the redemption, repurchase, retirement, defeasance or other
acquisition of any Subordinated Indebtedness or of any of the Company's Equity
Interests by conversion into, or by an exchange for, shares of the Company's
Equity Interests (other than Disqualified Stock), or in exchange for, or out of
the net cash proceeds of the substantially concurrent sale (other than to any of
the Company's Restricted Subsidiaries) of, the Company's Equity Interests (other
than Disqualified Stock); provided that the amount of any such net cash proceeds
that are utilized for any such redemption, repurchase, retirement, defeasance or
other acquisition will be excluded from clause (c)(ii) of the preceding
paragraph;
(3) the defeasance, redemption, repurchase or other acquisition of
Subordinated Indebtedness with the net cash proceeds from an incurrence of
Permitted Refinancing Indebtedness;
(4) the payment of any dividend by a Restricted Subsidiary of the
Company to the holders of its Equity Interests on a pro rata basis;
(5) the repurchase, redemption or other acquisition or retirement
for value of any Equity Interests of the Company or any Restricted Subsidiary of
the Company held by any member of the Company's (or any of its Restricted
Subsidiaries') management pursuant to any management equity subscription
agreement, stock option agreement or similar agreement; provided that the
aggregate price paid for all such repurchased, redeemed, acquired or retired
Equity Interests may not exceed $2.5 million in any twelve-month period; and
41
(6) other Restricted Payments in an aggregate amount since the date
hereof not to exceed $25.0 million.
The amount of all Restricted Payments (other than cash) will be the
fair market value on the date of the Restricted Payment of the asset(s) or
securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any assets or securities that are required to be valued
by this Section 4.10 will be determined by the Board of Directors of the Company
whose resolutions with respect thereto will be delivered to the Trustee. The
Board of Directors' determination must be based upon an opinion or appraisal
issued by an accounting, appraisal or investment banking firm of national
standing if the fair market value exceeds $5.0 million. Not later than the date
of making any Restricted Payment, the Company shall deliver to the Trustee an
Officers' Certificate stating that such Restricted Payment is permitted and
setting forth the basis upon which the calculations required by this Section
4.10 were computed, together with a copy of any fairness opinion or appraisal
required by this Indenture.
Section 4.11. LIENS.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist any Lien of any kind securing Indebtedness, Attributable Debt or trade
payables on any asset now owned or hereafter acquired or any proceeds therefrom,
or assign or convey any right to receive income therefrom, except Permitted
Liens; provided, however, that:
(a) in the case of Liens securing Subordinated Indebtedness, the
Notes must be secured by a Lien on such property (including Capital Stock
of a Restricted Subsidiary), assets, proceeds, income or profit that is
senior in priority to such Liens; and
(b) in the case of Liens securing Senior Subordinated Indebtedness,
the Notes must be equally and ratably secured by a Lien on such property
(including Capital Stock of a Restricted Subsidiary), assets, proceeds,
income or profit.
Section 4.12. ASSET SALES.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to consummate an Asset Sale unless:
(i) the Company or such Restricted Subsidiary, as the case may be,
receives consideration at the time of such Asset Sale at least equal to
the fair market value of the assets sold or otherwise disposed of
(evidenced by a Board Resolution of the Board of Directors of the Company
set forth in an Officers' Certificate delivered to the Trustee);
(ii) if the Company or such Restricted Subsidiary, as the case may be,
receives consideration at the time of such Asset Sale greater than $7.5
million, the fair market value of the assets sold or otherwise disposed of
is determined by Parent's Board of Directors (such determination to be
evidenced by a Board Resolution of Parent's Board of Directors set forth
in an Officers' Certificate delivered to the Trustee) or in a written
opinion issued by an independent appraisal firm or financial advisor of
national standing; and
(iii) at least 75% of the consideration received in the Asset Sale by
the Company or such Restricted Subsidiary is in the form of cash, Cash
Equivalents or Replacement Assets.
(b) For purposes of Section 4.12(a) only, each of the following will
be deemed to be cash:
(i) any liabilities of the Company or any of its Restricted
Subsidiaries, as shown on the Company's or such Restricted Subsidiary's
most recent balance sheet (other than contingent liabilities and
liabilities that are by their terms subordinated to the Notes or any
Restricted Subsidiary's Subsidiary Guarantee) that are assumed by the
transferee of any such assets pursuant to a customary novation agreement
that releases the Company or such Restricted Subsidiary from further
liability; and
42
(ii) any securities, notes or other obligations received by the Company
or any such Restricted Subsidiary from such transferee that are
contemporaneously, subject to ordinary settlement periods, converted by
the Company or such Restricted Subsidiary into cash, to the extent of the
cash received in that conversion;
(iii) any Designated Non-Cash Consideration received by the Company or
any of its Restricted Subsidiaries in the Asset Sale.
(c) Within 365 days after the receipt of any Net Proceeds from an
Asset Sale, the Company and its Restricted Subsidiaries may apply those Net
Proceeds at their option:
(i) to repay the Company's or any Restricted Subsidiary's Indebtedness
(other than Subordinated Indebtedness);
(ii) to acquire all or substantially all of the assets of, or a
majority of the Voting Stock of, another Permitted Business (or enter into
a definitive agreement committing the Company or one of its Restricted
Subsidiaries to make such purchase within six months of the date of such
agreement; provided that if such agreement is terminated, the Company or
such Restricted Subsidiary may invest such Net Proceeds prior to the end
of such 365-day period, or if later, prior to the end of the six-month
period referred to in this clause (ii)); or
(iii) to acquire other long-term assets or to make a capital
expenditure, in each case, that are used or useful in a Permitted Business
(or enter into a definitive agreement committing the Company or one of its
Restricted Subsidiaries to make such acquisition or expenditure within six
months of the date of such agreement; provided that if such agreement is
terminated, the Company or such Restricted Subsidiary may invest such Net
Proceeds prior to the end of such 365-day period, or if later, prior to
the end of the six-month period referred to in this clause (iii)).
Pending the final application of any Net Proceeds, the Company may
temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by this Indenture.
(d) Any Net Proceeds from Asset Sales that are not applied or
invested within such 365-day period as provided in Section 4.12(c) will
constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds
exceeds $15.0 million, not later than 30 days after such date, the Company shall
make an Asset Sale Offer (which offer may be made at any time within such 365 or
30-day periods) to all Holders of Notes and Additional Notes, if any, and all
holders of other Indebtedness that is pari passu with the Notes containing
provisions similar to those set forth herein with respect to offers to purchase
or redeem with the proceeds of sales of assets to purchase, on a pro rata basis,
the maximum principal amount of Notes and Additional Notes, if any, and such
other pari passu Indebtedness equal in amount to the Excess Proceeds remaining
after an asset sale offer required to be commenced prior to the Asset Sale Offer
(and not just the amount thereof that exceeds $15.0 million). The offer price in
any Asset Sale Offer will be equal to 100% of the principal amount thereof plus
accrued and unpaid interest and Additional Interest, if any, to the date of
purchase, in accordance with the procedures set forth herein, and shall be
payable in cash. If any Excess Proceeds remain after consummation of an Asset
Sale Offer, the Company may use those Excess Proceeds for any purpose not
otherwise prohibited by this Indenture. If the aggregate principal amount of
Notes and Additional Notes, if any, and other pari passu Indebtedness
surrendered by holders thereof exceeds the amount of Excess Proceeds remaining
after an asset sale offer required to be commenced prior to the Asset Sale
Offer, the Trustee shall select the Notes and Additional Notes, if any, and
other pari passu Indebtedness to be purchased as described in Article 3 hereof.
Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be
reset at zero.
(e) The Company shall comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent those laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sale
provisions of this Indenture, the Company shall comply with the applicable
securities laws and regulations and will not be deemed to have breached its
obligations under this Section 4.12 by virtue of such conflict.
43
Section 4.13. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED
SUBSIDIARIES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:
(a) pay dividends or make any other distributions on or in respect
of its Capital Stock to the Company or any of its Restricted Subsidiaries, or
with respect to any other interest or participation in, or measured by, its
profits, or pay any Indebtedness owed to the Company or any other of its
Restricted Subsidiaries;
(b) make any loans or advances to the Company or any other of its
Restricted Subsidiaries;
(c) sell, lease or transfer any of its properties or assets to the
Company or any other of its Restricted Subsidiaries; or
(d) guarantee the Company's obligations.
However, the preceding restrictions will not apply to encumbrances
or restrictions existing under or by reason of:
(i) agreements as in effect on the date hereof or subsequent agreements
relating to our Indebtedness or Indebtedness of any Subsidiary Guarantor
and any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of those agreements;
provided that the amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacement or refinancings are not
materially more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in those
agreements on the date hereof;
(ii) this Indenture, the Notes and the Subsidiary Guarantees;
(iii) applicable law;
(iv) any instrument governing Indebtedness or Capital Stock of a Person
acquired by the Company or any of its Restricted Subsidiaries as in effect
at the time 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 Indebtedness, such Indebtedness was
permitted by the terms of this Indenture to be incurred;
(v) customary non-assignment provisions in leases entered into in the
ordinary course of business;
(vi) purchase money obligations for property acquired in the ordinary
course of business that impose restrictions on that property of the nature
described in clause (c) of the preceding paragraph;
(vii) any agreement for the sale or other disposition of a Restricted
Subsidiary that restricts distributions by that Restricted Subsidiary
pending its sale or other disposition;
(viii) Permitted Refinancing Indebtedness; provided that the
restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are not materially more restrictive, taken as a
whole, than those contained in the agreements governing the Indebtedness
being refinanced;
(ix) Liens securing Indebtedness otherwise permitted to be incurred
under Section 4.11 that limit the right of the debtor to dispose of the
assets subject to such Liens; and
44
(x) provisions with respect to the disposition or distribution of
assets or property in joint venture agreements, asset sale agreements,
stock sale agreements and other similar agreements entered into in the
ordinary course of business.
Section 4.14. TRANSACTIONS WITH AFFILIATES.
The Company shall not, and shall not permit any of its Restricted
Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of their respective properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each, an "AFFILIATE TRANSACTION"), unless:
(a) the Affiliate Transaction is on terms that are no less favorable
to the Company or the relevant Restricted Subsidiary than those that would have
been obtained in a comparable transaction by the Company or such Restricted
Subsidiary with a Person that is not an Affiliate; and
(b) the Company delivers to the trustee:
(i) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$15.0 million, a resolution of the Board of Directors of the Company set
forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with this covenant and that such Affiliate
Transaction has been approved by a majority of the disinterested members
of the Board of Directors of the Company or Parent's Board of Directors,
or, if there are no disinterested members of the approving Board of
Directors at the time, a written opinion issued by an independent
appraisal firm or financial advisor of national standing that such
Affiliate Transaction is fair to the Company or such Restricted
Subsidiary, as the case may be, from a financial point of view; and
(ii) with respect to any Affiliate Transaction or series of related
Affiliate Transactions involving aggregate consideration in excess of
$25.0 million, a written opinion issued by an independent financial
advisor of national standing that such Affiliate Transaction is fair to
the Company or such Restricted Subsidiary, as the case may be, from a
financial point of view.
The following items will not be deemed to be Affiliate Transactions
and, therefore, will not be subject to the provisions of the prior paragraph:
(a) transactions between or among the Company and/or its Restricted
Subsidiaries;
(b) transactions with a Person that is an Affiliate of the Company
solely because the Company owns an Equity Interest in such Person;
(c) advances to officers of the Company or any of the Company's
Restricted Subsidiaries in the ordinary course of business to provide for the
payment of reasonable expenses incurred by such persons in the performance of
their responsibilities to the Company or such Restricted Subsidiary or in
connection with any relocation;
(d) sales of Equity Interests (other than Disqualified Stock) to
Affiliates of the Company;
(e) fees and compensation paid to and indemnity provided on behalf
of directors, officers or employees of the Company or any Restricted Subsidiary
of the Company in the ordinary course of business;
(f) any employment agreement that is in effect on the date hereof
and any such employment agreement entered into by the Company or any of its
Restricted Subsidiaries after the date hereof in the ordinary course of
business;
(g) any Restricted Payment that is not prohibited by Section 4.10;
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(h) any sale, conveyance or other transfer of accounts receivable
and other related assets customarily transferred in a Securitization
Transaction;
(i) payment of premiums to, and the receipt of proceeds of insurance
from, Laurier Indemnity Company and Laurier Indemnity Company, Ltd.;
(j) payments to or receipts from Extendicare Holdings, Inc. pursuant
to any tax sharing agreement entered into for the purpose of preparing a
consolidated tax return of Extendicare Holdings, Inc.;
(k) payments to or receipts from Virtual Care Provider, Inc. in
connection with the provision of technology services to third parties pursuant
to the terms of management, consulting or other similar agreements; and
(l) transactions pursuant to the services agreement between the
Company and Virtual Care Provider, Inc. relating to certain services provided by
the Company and Virtual Care Provider, Inc. to each other as in effect on the
date hereof.
Section 4.15. [Reserved.]
Section 4.16. [Reserved.]
Section 4.17. DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
The Board of Directors of the Company may designate any Restricted
Subsidiary to be an Unrestricted Subsidiary if that designation would not cause
a Default. If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned
by the Company and its Restricted Subsidiaries in the Subsidiary properly
designated will be deemed to be an Investment made as of the time of the
designation and will reduce the amount available for Restricted Payments under
the first paragraph of Section 4.10 or Permitted Investments, as determined by
the Company. That designation will only be permitted if the Investment would be
permitted at that time and if the Restricted Subsidiary otherwise meets the
definition of an Unrestricted Subsidiary. The Board of Directors of the Company
may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if the
redesignation would not cause a Default.
Section 4.18. REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, each Holder shall
have the right to require the Company to repurchase all or any part (equal to
$1,000 or an integral multiple of $1,000) of such Holder's Notes pursuant to the
offer described below (the "CHANGE OF CONTROL OFFER") at a purchase price (the
"CHANGE OF CONTROL PURCHASE PRICE") equal to 101% of the aggregate principal
amount of Notes repurchased, plus accrued and unpaid interest and Additional
Interest if any, on the Notes repurchased, to the purchase date (subject to the
right of Holders on the relevant record date to receive interest due on the
relevant Interest Payment Date).
Subject to clause (c) below, within 30 days following any Change of
Control, the Company shall mail a notice to the Trustee and each Holder:
(i) send, by first-class mail, with a copy to the Trustee, to each
Holder, at such Holder's address appearing in the securities register
maintained in respect of the Notes by the Registrar (the "SECURITY
REGISTER"):
(A) that a Change of Control has occurred and a Change of
Control Offer is being made pursuant to Section 4.18 and that all
Notes timely tendered will be accepted for payment;
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(B) the Change of Control Purchase Price and the purchase
date, which shall be, subject to any contrary requirements of
applicable law, a business day no earlier than 30 days and no later
than 60 days from the date such notice is mailed;
(C) the circumstances and relevant facts regarding the Change
of Control (including information with respect to pro forma
historical income, cash flow and capitalization after giving effect
to the Change of Control); and
(D) the procedures that Holders must follow in order to tender
their Notes (or portions thereof) for payment, and the procedures
that Holders must follow in order to withdraw an election to tender
Notes (or portions thereof) for payment.
The Company will comply, to the extent applicable, with the
requirements of Rule 14(e)-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent those laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a
Change of Control. To the extent that the provisions of any securities laws or
regulations conflict with the Change of Control provisions of the covenant
described hereunder, the Company will comply with the applicable securities laws
and regulations and will not be deemed to have breached its obligations under
the covenant described hereunder by virtue of such conflict.
(b) On the Change of Control Payment Date, the Company shall, to the
extent lawful:
(i) accept for payment all Notes or portions of Notes properly tendered
and not withdrawn pursuant to the Change of Control Offer;
(ii) deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions of Notes properly
tendered and not withdrawn; and
(iii) deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions of Notes being purchased
by the Company.
The Paying Agent shall promptly mail to each Holder of Notes
properly tendered and not withdrawn the Change of Control Payment for such
Notes, and the Trustee will promptly authenticate and mail (or cause to be
transferred by book-entry) to each Holder a new note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that each
new note will be in a principal amount of $1,000 or an integral multiple of
$1,000.
(c) Prior to complying with any of the provisions of this Section
4.18, but in any event within 90 days following a Change of Control, the Company
shall either repay all outstanding Senior Debt or obtain the requisite consents,
if any, under all agreements governing outstanding Senior Debt to permit the
repurchase of Notes required by this covenant. The Company shall publicly
announce the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Payment Date.
(d) The provisions described above that require us to make a Change
of Control Offer following a Change of Control will be applicable whether or not
any other provisions of the indenture are applicable. Except as described above
with respect to a Change of Control, this Indenture does not contain provisions
that permit the Holders of the Notes to require that the Company repurchase or
redeem the Notes in the event of a takeover, recapitalization or similar
transaction.
(e) The Company will not be required to make a Change of Control
Offer upon a Change of Control if a third party makes a Change of Control Offer
in the manner, at the times and otherwise in compliance with the requirements
set forth in this Indenture applicable to a Change of Control Offer made by the
Company and purchases all Notes properly tendered and not withdrawn under the
Change of Control Offer.
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Section 4.19. ADDITIONAL SUBSIDIARY GUARANTEES
If the Company or any of its Restricted Subsidiaries acquires or
creates another domestic Significant Subsidiary or any other Domestic Subsidiary
that guarantees or incurs any Indebtedness or any other Significant Subsidiary
or Restricted Subsidiary that guarantees or otherwise provides direct credit
support for Indebtedness of the Company or any of the Company's Domestic
Subsidiaries after the date hereof, then that newly acquired or created
Significant Subsidiary, Domestic Subsidiary or other Restricted Subsidiary will
execute and deliver to the Trustee a supplemental indenture providing for a
Subsidiary Guarantee and deliver an Opinion of Counsel satisfactory to the
Trustee within 10 Business Days of the date on which it was acquired or created;
provided, however, that the foregoing shall not apply to Subsidiaries that have
properly been designated as Unrestricted Subsidiaries in accordance with this
Indenture for so long as they continue to constitute Unrestricted Subsidiaries.
Section 4.20. [Reserved.]
Section 4.21. BUSINESS ACTIVITIES.
The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any business other than Permitted Businesses, except to
such extent as would not be material to the Company and its Subsidiaries taken
as a whole.
ARTICLE 5.
SUCCESSORS
Section 5.01. MERGER, CONSOLIDATION, OR SALE OF PROPERTY.
The Company shall not, directly or indirectly (a) consolidate or
merge with or into another Person (whether or not the Company is the surviving
corporation) or (b) sell, assign, transfer, convey or otherwise dispose of all
or substantially all of the properties or assets of the Company and its
Restricted Subsidiaries taken as a whole, in one or more related transactions,
to another Person; unless:
(a) either: (x) the Company is the surviving corporation; or (y) the
Person formed by or surviving any such consolidation or merger (if other than
the Company) or to which such sale, assignment, transfer, conveyance or other
disposition has been made is a corporation organized or existing under the laws
of the United States, any state of the United States or the District of
Columbia;
(b) the Person formed by or surviving any such consolidation or
merger (if other than the Company) or the Person to which such sale, assignment,
transfer, conveyance or other disposition has been made assumes all of the
Company's obligations under the Notes, this Indenture and the Registration
Rights Agreement pursuant to a supplemental indenture reasonably satisfactory to
the Trustee;
(c) immediately after such transaction no Default or Event of
Default exists;
(d) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, conveyance or other disposition has been made, on the date
of such transaction after giving pro forma effect thereto and any related
financing transactions as if the same had occurred at the beginning of the
applicable four-quarter period, (i) shall be permitted to incur at least $1.00
of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in Section 4.09 or (ii) the Company's Fixed Charge Coverage Ratio, or the
Fixed Charge Coverage Ratio of the surviving Person if the Company is not the
continuing obligor hereunder, shall not be less than the Company's Fixed Charge
Coverage Ratio immediately prior to such transaction and any related financing
transactions; and
(e) the Company, or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, conveyance or other disposition has been
48
made, shall have delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, each stating that such transaction and any supplemental
indenture entered into in connection therewith complies with all of the terms of
this Section 5.01 and that all conditions precedent provided for in this
Indenture relating to such transaction or series of transactions have been
complied with.
In addition, the Company may not, directly or indirectly, lease all
or substantially all of its properties or assets, in one or more related
transactions, to any other Person.
The Person formed by or surviving any consolidation or merger (if
other than the Company) will succeed to, and be substituted for, and may
exercise every right and power of the Company under this Indenture, but, in the
case of a lease of all or substantially all the assets of the Company, the
Company will not be released from the obligation to pay the principal of and
interest on the Notes.
Section 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
The Surviving Person shall succeed to, and be substituted for, and
may exercise every right and power of the Company under this Indenture, but the
predecessor Company in the case of:
(a) a sale, transfer, assignment, conveyance or other disposition
(unless such sale, transfer, assignment, conveyance or other disposition is of
all the assets of the Company as an entirety or virtually as an entirety), or
(b) a lease,
shall not be released from any of the obligations or covenants under this
Indenture, including with respect to the payment of the Notes.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01. EVENTS OF DEFAULT.
Each of the following is an "Event of Default:"
(i) default for 30 days in the payment when due of interest on, or
Additional Interest with respect to, the Notes (whether or not prohibited
by Article 12);
(ii) default in payment when due of the principal of or premium, if
any, on the Notes (whether or not prohibited by Article 12);
(iii) failure by the Company or any of its Restricted Subsidiaries to
comply with Section 4.09 or 4.10 or Article 5;
(iv) failure by the Company or any of its Restricted Subsidiaries for
30 days after notice to comply with Section 4.12 or 4.18;
(v) failure by the Company or any of its Restricted Subsidiaries for 60
days after notice to comply with any other covenant or agreement in the
Notes or in this Indenture;
(vi) default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries (or the payment of which is guaranteed by the Company or any
of its Restricted Subsidiaries) whether such Indebtedness or guarantee now
exists, or is created after the date hereof, if that default:
49
(A) is caused by a failure to pay principal of, or interest or
premium, if any, on such Indebtedness prior to the expiration of the
grace period provided in such Indebtedness on the date of such
default (a "Payment Default"); or
(B) results in the acceleration of such Indebtedness prior to
its express maturity,
and, in each case, the principal amount of any such Indebtedness,
together with the principal amount of any other such Indebtedness under which
there has been a Payment Default or the maturity of which has been so
accelerated, aggregates $20.0 million or more;
(vii) failure by the Company or any of its Restricted Subsidiaries
to pay final judgments (to the extent not fully covered by insurance)
aggregating in excess of $20.0 million, which judgments are not paid,
discharged or stayed for a period of 60 consecutive days;
(viii) except as permitted by this Indenture, any Subsidiary
Guarantee shall be held in any judicial proceeding to be unenforceable or
invalid or shall cease for any reason to be in full force and effect or
any Subsidiary Guarantor, or any Person acting on behalf of any Subsidiary
Guarantor, shall deny or disaffirm its obligations under its Subsidiary
Guarantee; and
(ix) the Company or any of its Significant Subsidiaries pursuant to
or within the meaning of Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against it in
an involuntary case,
(C) consents to the appointment of a custodian of it or for
all or substantially all of its property,
(D) makes a general assignment for the benefit of its
creditors, or
(E) generally is not paying its debts as they become due; and
(x) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any of its
Significant Subsidiaries in an involuntary case; or
(B) appoints a Custodian of the Company or any of its
Significant Subsidiaries or for all or substantially all of the
property of the Company or any of its Significant Subsidiaries; or
(C) orders the liquidation of the Company or any of its
Significant Subsidiaries;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.02. ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clauses (ix) or (x) of Section 6.01 hereof, with respect to the Company, any
Subsidiary that is a Significant Subsidiary or any group of Subsidiaries that,
taken together would constitute a Significant Subsidiary), shall have occurred
and be continuing, the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Notes then outstanding may
50
declare to be immediately due and payable the principal amount of all the Notes
then outstanding, plus accrued but unpaid interest and Additional Interest, if
any, to the date of acceleration. In the case of an Event of Default specified
in clauses (ix) or (x) of Section 6.01 hereof, with respect to the Company, any
Subsidiary that is a Significant Subsidiary or any group of Subsidiaries that,
taken together would constitute a Significant Subsidiary shall occur, such
amount with respect to all the Notes will become due and payable immediately
without any declaration or other act on the part of the Trustee or the Holders.
Holders may not enforce this Indenture or the Notes except as provided in this
Indenture. Subject to the limitations described in this Article 6, Holders of a
majority in aggregate principal amount of the then outstanding Notes may direct
the Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders notice of any continuing Default or Event of Default (except a Default
or Event of Default relating to the payment of principal, premium, if any, or
interest or Additional Interest, if any) if it determines that withholding
notice is in their interest.
In the case of an Event of Default occurring by reason of any
willful action or inaction taken or not taken by the Company or on the Company's
behalf with the intention of avoiding payment of the premium that the Company
would have been required to pay if the Company had then elected to redeem the
Notes pursuant to Section 3.07 hereof, an equivalent premium will also become
and be immediately due and payable to the extent permitted by law upon the
acceleration of the Notes. If an Event of Default occurs prior to May 1, 2009,
by reason of any willful action or inaction taken or not taken by the Company or
on the Company's behalf with the intention of avoiding the prohibition on
redemption of the Notes prior to May 1, 2009, then the premium specified in
Section 3.07 will also become immediately due and payable to the extent
permitted by law upon acceleration of the Notes.
Section 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of principal, premium, if
any, and interest and Additional Interest, if any, on the Notes or to enforce
the performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
Section 6.04. WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount of
the then outstanding Notes by notice to the Trustee may on behalf of the Holders
of all of the Notes waive an existing Default or Event of Default and its
consequences hereunder, except a continuing Default or Event of Default in the
payment of the principal of, premium, if any, or interest or Additional Interest
on, the Notes; provided, however, that after any acceleration, but before a
judgment or decree based on acceleration is obtained by the Trustee, the Holders
of a majority in aggregate principal amount of the Notes then outstanding may
rescind and annul such acceleration if all Events of Default, other than the
nonpayment of accelerated principal, premium or interest or Additional Interest,
have been cured or waived as provided in this Indenture. Upon any such waiver,
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
Section 6.05. CONTROL BY MAJORITY.
Subject to Section 7.01, in case an Event of Default shall occur and
be continuing, the Trustee will be under no obligation to exercise any of its
rights or powers under this Indenture at the request or direction of any of the
Holders, unless such Holders shall have offered to the Trustee reasonable
indemnity. Subject to Section 7.07, the Holders of a majority in aggregate
principal amount of the Notes then outstanding will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee with
respect to the Notes.
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Section 6.06. LIMITATION ON SUITS.
No Holder will have any right to institute any proceeding with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any remedy thereunder, unless:
(a) such Holder has previously given to the Trustee written notice
of a continuing Event of Default,
(b) Holders of at least 25% in aggregate principal amount of the
Notes then outstanding have made written request and offered reasonable
indemnity to the Trustee to institute such proceeding as trustee, and
(c) the Trustee shall not have received from the Holders of a
majority in aggregate principal amount of the Notes then outstanding a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days.
The preceding limitations do not apply to a suit instituted by a
Holder for enforcement of payment of the principal of, and premium, if any, or
interest or Additional Interest on, a Note on or after the respective due dates
expressed in such Note.
A Holder may not use this Indenture to affect, disturb or prejudice
the rights of another Holder or to obtain a preference or priority over another
Holder.
Section 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of principal, premium, if any, and interest and
Additional Interest, if any, on the Note, on or after the respective due dates
expressed in the Note (including in connection with an offer to purchase), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
Section 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in clauses (i) or (ii) of Section
6.01 occurs and is continuing, the Trustee is authorized to recover judgment in
its own name and as trustee of an express trust against the Company for the
whole amount of principal of, premium, if any, and interest and Additional
Interest, if any, remaining unpaid on the Notes and interest on overdue
principal and, to the extent lawful, interest 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 is authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to participate as a member, voting or otherwise, of any
official committee of creditors appointed in such matter and shall be entitled
and empowered to collect, receive and distribute any money or other property
payable or deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder 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 Holders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,
52
dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due
under Section 7.07 hereof, including payment of all compensation, expenses and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest and Additional Interest, if any,
ratably, without preference or priority of any kind, according to the amounts
due and payable on the Notes for principal, premium, if any, and interest and
Additional Interest, if any,, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment
to Holders 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 a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(b) Except during the continuance of an Event of Default:
(1) the duties of the Trustee shall be determined solely by
the express provisions of this Indenture and the Trustee need
perform only those duties that are specifically set forth in this
Indenture and no others, and no implied covenants or obligations
shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the
53
requirements of this Indenture. However, the Trustee shall examine
the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture (but need not confirm
or investigate the accuracy of mathematical calculations or other
facts stated therein or otherwise verify the contents thereof).
(c) The Trustee may not be relieved from liabilities 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;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
(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 6.05 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b) and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or incur any liability. The Trustee shall be under
no obligation to exercise any of its rights and powers under this Indenture at
the request of any Holders, unless such Holder shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
Section 7.02. RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely 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 require
an Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
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(g) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
Default or Event of Default is received by a Responsible Officer of the Trustee
at the Corporate Trust Office of the Trustee, and such notice references the
specific Default or Event of Default, the Notes and this Indenture.
(h) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed in writing with the Company.
(i) The Trustee shall not be required to give any bond or surety in
respect of the performance of its power and duties hereunder.
(j) The Trustee shall have no duty to inquire as to the performance
of the Company's covenants herein.
Section 7.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as Trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Section 7.10 and 7.11 hereof.
Section 7.04. TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representation
as to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it 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 or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.
Section 7.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to Holders a notice of the
Default or Event of Default within 90 days after it occurs unless such Default
or Event of Default has since been cured. Except in the case of a Default or
Event of Default in payment of principal of, premium, if any, or interest or
Additional Interest, if any, on any Note, the Trustee may withhold the notice if
and so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of the Holders.
Section 7.06. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15 beginning with May 15, 2005, and
for so long as Notes remain outstanding, the Trustee shall mail to the Holders a
brief report dated as of such reporting date that complies with TIA Section
313(a) (but if no event described in TIA Section 313(a) has occurred within the
twelve months preceding the reporting date, no report need be transmitted). The
Trustee also shall comply with TIA Section 313(b)(2). The Trustee shall also
transmit by mail all reports as required by TIA Section 313(c).
A copy of each report at the time of its mailing to the Holders
shall be mailed to the Company and filed with the SEC and each stock exchange on
which the Notes are listed in accordance with TIA Section 313(d). The Company
shall promptly notify the Trustee when the Notes are listed on any stock
exchange.
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Section 7.07. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder as
agreed to in writing. The Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Company shall reimburse
the Trustee promptly upon request for all reasonable disbursements, advances and
expenses incurred or made by it in addition to the compensation for its
services. Such expenses shall include the reasonable compensation, disbursements
and expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee or any predecessor Trustee
against any and all losses, claims, damages, penalties, fines, liabilities or
expenses, including incidental and out-of-pocket expenses and reasonable
attorneys fees ("LOSSES") incurred by it arising out of or in connection with
the acceptance or administration of its duties under this Indenture, including
the costs and expenses of enforcing this Indenture against the Company
(including this Section 7.07) and defending itself against any claim (whether
asserted by the Company or any Holder or any other person) or liability in
connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such losses may be attributable to its gross
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim, and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable fees
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld. The
Company need not reimburse any expense or indemnify against any loss liability
or expense incurred by the Trustee through the Trustee's own willful misconduct,
gross negligence or bad faith.
The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal, premium,
if any, and interest and Additional Interest, if any, on particular Notes. Such
Lien shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event
of Default specified in clauses (ix) or (x) of Section 6.01 hereof occurs, the
expenses and the compensation for the services (including the fees and expenses
of its agents and counsel) are intended to constitute expenses of administration
under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA Section
313(b)(2) to the extent applicable.
Section 7.08. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
The Trustee may resign in writing at any time upon 30 days prior
notice to the Company and be discharged from the trust hereby created by so
notifying the Company. The Holders of a majority in principal amount of the then
outstanding Notes may remove the Trustee by so notifying the Trustee and the
Company in writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
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(d) 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 Company 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 then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10, such Holder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. Subject to the Lien provided for in Section 7.07 hereof,
the retiring Trustee shall promptly transfer all property held by it as Trustee
to the successor Trustee; provided, however, that all sums owing to the Trustee
hereunder shall have been paid. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations under Section 7.07
hereof shall continue for the benefit of the retiring Trustee.
Section 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
Section 7.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a Person
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $50,000,000
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).
Section 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE 8.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at its option and at any time, elect to have either
Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance
with the conditions set forth below in this Article 8.
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Section 8.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "LEGAL
DEFEASANCE"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Debt represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal of, premium, if any, and interest and Additional Interest, if any,
on such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the
obligations of the Company and each of the Subsidiary Guarantors in connection
therewith and (d) this Article 8. If the Company exercises under Section 8.01
hereof the option applicable to this Section 8.02, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, payment of the Notes may not
be accelerated because of an Event of Default. Subject to compliance with this
Article 8, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.
Section 8.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.05, 4.06 and 4.08
through 4.18 hereof, and the operation of Section 5.01(d) hereof, with respect
to the outstanding Notes on and after the date the conditions set forth in
Section 8.04 are satisfied (hereinafter, "COVENANT DEFEASANCE"), and the Notes
shall thereafter be deemed not "outstanding" for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that such
Notes shall not be deemed outstanding for accounting purposes). For this
purpose, Covenant Defeasance means that, with respect to the outstanding Notes,
the Company may omit to comply with and shall have no liability in respect of
any term, condition or limitation set forth in any such covenant, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 hereof, but,
except as specified above, the remainder of this Indenture and such Notes shall
be unaffected thereby. If the Company exercises under Section 8.01 hereof the
option applicable to this Section 8.03, subject to the satisfaction of the
conditions set forth in Section 8.04 hereof, payment of the Notes may not be
accelerated because of an Event of Default specified in clauses (iii) and (iv)
(with respect to the covenants contained in Sections 4.05, 4.06 and 4.08 through
4.18 hereof), (v), (vi), (vii) and (viii) (but in the case of clauses (ix) and
(x) of Section 6.01 hereof, with respect to Significant Subsidiaries only).
Section 8.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes.
The Legal Defeasance or Covenant Defeasance may be exercised only
if:
(a) the Company irrevocably deposits with the Trustee, in trust, for
the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable
Government Securities, or a combination of cash in U.S. dollars and non-callable
Government Securities, in amounts as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants, to pay the
principal of, or interest and premium and Additional Interest, if any,
58
on the outstanding Notes on the Stated Maturity or on the applicable redemption
date, as the case may be, and the Company must specify whether the Notes are
being defeased to maturity or to a particular redemption date;
(b) in the case of Legal Defeasance, the Company delivers to the
Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming
that (a) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling or (b) since the date hereof, there has been a
change in the applicable federal income tax law, in either case to the effect
that, and based thereon such Opinion of Counsel will confirm that, the Holders
of the outstanding Notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of Covenant Defeasance, the Company delivers to the
Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming
that the Holders of the outstanding Notes will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant Defeasance and
will be subject to federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such Covenant Defeasance
had not occurred;
(d) no Default or Event of Default has occurred and is continuing on
the date of such deposit (other than a Default or Event of Default resulting
from the borrowing of funds to be applied to such deposit);
(e) such Legal Defeasance or Covenant Defeasance will not result in
a breach or violation of, or constitute a default under any material agreement
or instrument (including, without limitation, the Credit Agreement, but
excluding the indenture) to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries may is bound;
(f) the Company delivers to the Trustee an Officers' Certificate
stating that the deposit was not made by the Company with the intent of
preferring the Holders of Notes over the Company's other creditors with the
intent of defeating, hindering, delaying or defrauding the Company's creditors
or others; and
(g) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent relating to
the Legal Defeasance or the Covenant Defeasance have been complied with.
Section 8.05. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.06 hereof, 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 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of all sums due and to become due thereon
in respect of principal, premium, if any, and interest and Additional Interest,
if any, but such money need not be segregated from other funds except to the
extent required by law.
The Company 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 hereof 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 outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or U.S. Government Obligations held by it as provided
in Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent certified public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the
59
certification delivered under Section 8.04(b) hereof), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.
Section 8.06. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium, if
any, or interest or Additional Interest on any Note and remaining unclaimed for
two years after such principal, and premium, if any, or interest or Additional
Interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) shall be discharged from such trust; and the
Holder shall thereafter, as an unsecured creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in The New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Company.
Section 8.07. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or U.S. Government Obligations in accordance with Section 8.02 or 8.03
hereof, 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 Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof 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
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or interest or Additional Interest on
any Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders to receive such payment from the money
held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. WITHOUT CONSENT OF HOLDERS OF NOTES.
Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder to:
(a) cure any ambiguity, defect or inconsistency;
(b) provide for the assumption by a successor corporation of the
obligations of the Company under this Indenture in the case of a merger or
consolidation or sale of all or substantially all of the Company's assets;
(c) provide for uncertificated Notes in addition to or in place of
certificated Notes;
(d) make any change that would provide any additional rights or
benefits to the Holders of the Notes or that does not adversely affect the legal
rights hereunder of any such Holder; or
(e) make any change to comply with any requirement of the SEC in
order to effect or maintain the qualification of this Indenture under the TIA.
Upon the request of the Company accompanied by a Board Resolution of
the Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon receipt by the Trustee of the documents
described in Section 7.02 hereof, the Trustee shall join with the Company in the
execution of any
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amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.02. WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture and the Notes may be amended or
supplemented with the consent of the Holders of at least a majority in principal
amount of the Notes, including Additional Notes, if any, then outstanding voting
as a single class (including consents obtained in connection with a tender offer
or exchange offer for, or purchase of, the Notes), and, subject to Sections 6.04
and 6.07 hereof, any existing Default or Event of Default (except a continuing
Default or Event of Default in the payment of interest or Additional Interest
on, or the principal of, the Notes) or compliance with any provision of this
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the Notes, including Additional Notes, if any,
then outstanding voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes).
Upon the request of the Company accompanied by a Board Resolution of
the Board of Directors authorizing the execution of any such amended or
supplemental Indenture, and upon the filing with the Trustee of evidence
satisfactory to the Trustee of the consent of the Holders of Notes as aforesaid,
and upon receipt by the Trustee of the documents described in Section 7.02
hereof, the Trustee shall join with the Company in the execution of such amended
or supplemental Indenture unless such amended or supplemental Indenture directly
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such amended or supplemental Indenture.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Persons entitled to consent to any indenture
supplemental hereto. If a record date is fixed, the Holders on such record date,
or their duly designated proxies, and only such Persons, shall be entitled to
consent to such supplemental indenture, whether or not such Holders remain
Holders after such record date; provided, that unless such consent shall have
become effective by virtue of the requisite percentage having been obtained
prior to the date which is 90 days after such record date, any such consent
previously given shall automatically and without further action by any Holder be
cancelled and of no further effect.
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 or waiver,
but it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders to such Holder's address
appearing in the Security Register a notice briefly describing the amendment,
supplement or waiver. Any failure of the Company to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such amended or supplemental Indenture or waiver. Subject to Sections 6.04
and 6.07 hereof, the Holders of a majority in aggregate principal amount of the
Notes, including Additional Notes, if any, then outstanding voting as a single
class may waive compliance in a particular instance by the Company with any
provision of this Indenture or the Notes. Without the consent of each Holder, an
amendment or waiver under this Section 9.02 may not (with respect to any Notes
held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent
to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note
or alter the provisions with respect to the redemption of the Notes;
(c) make any change in the provisions of Sections 4.12 or 4.18;
61
(d) reduce the rate of or change the time for payment of interest on
any note,
(e) waive a Default or Event of Default in the payment of principal
of, or interest or premium, or Additional Interest, if any, on the Notes (except
a rescission of acceleration of the Notes by the Holders of at least a majority
in aggregate principal amount of the Notes and a waiver of the payment default
that resulted from such acceleration);
(f) make any Note payable in money other than that stated in the
Note,
(g) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of, or interest or premium or Additional Interest, if any, on the
Notes;
(h) waive a redemption payment with respect to any Note;
(i) release any Subsidiary Guarantor from any of its obligations
under its Subsidiary Guarantee or this Indenture, except in accordance with the
terms hereof;
(j) make any change to Article 12 (including applicable definitions)
that would adversely affect the Holders of the Notes; or
(k) make any change in the preceding amendment and waiver
provisions.
Section 9.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Notes shall
be set forth in a amended or supplemental Indenture that complies with the TIA
as then in effect.
Section 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder is a continuing consent by the Holder of a Note and
every subsequent Holder that evidences the same debt as the consenting Holder's
Note, even if notation of the consent is not made on any Note. However, any such
Holder or subsequent Holder may revoke the consent as to its Note if the Trustee
receives written notice of revocation before the date the waiver, supplement or
amendment becomes effective. An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.
Section 9.05. NOTATION ON OR EXCHANGE OF NOTES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
Section 9.06. TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon an Officer's Certificate and an Opinion
of Counsel stating that the execution of such amended or supplemental indenture
is authorized or permitted by this Indenture and that such amended or
supplemental indenture is the legal, valid and binding obligations of the
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Company enforceable against it in accordance with its terms, subject to
customary exceptions and that such amended or supplemental indenture complies
with the provisions hereof (including Section 9.03).
ARTICLE 10.
SUBSIDIARY GUARANTEES
Section 10.01. GUARANTEE.
Subject to this Article 10, each of the Subsidiary Guarantors
hereby, jointly and severally, unconditionally guarantees to each Holder of a
Note 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 Notes or the obligations of the Company hereunder or thereunder,
that: (a) the principal of, premium, if any, and interest on the Notes shall be
promptly paid in full when due, whether at maturity, by acceleration, redemption
or otherwise, and interest on the overdue principal of and interest on the
Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder shall be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that same shall be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration pursuant to Section 6.02 hereof or otherwise. Failing
payment when due of any amount so guaranteed or any performance so guaranteed
for whatever reason, the Subsidiary Guarantors shall be jointly and severally
obligated to pay the same immediately. Each Subsidiary Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.
Each Subsidiary Guarantor hereby agrees that its obligations with
regard to this Subsidiary Guarantee shall be joint and several, unconditional,
irrespective of the validity or enforceability of the Notes or the obligations
of the Company under this Indenture, the absence of any action to enforce the
same, the recovery of any judgment against the Company or any other obligor with
respect to this Indenture, the Notes or the Obligations of the Company under
this Indenture or the Notes, any action to enforce the same or any other
circumstances (other than complete performance) which might otherwise constitute
a legal or equitable discharge or defense of a Subsidiary Guarantor. Each
Subsidiary Guarantor further, to the extent permitted by law, waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims, rights
or remedies, including but not limited to: (a) any right to require any of the
Trustee, the Holders or the Company (each a "BENEFITED PARTY"), as a condition
of payment or performance by such Subsidiary Guarantor, to (1) proceed against
the Company, any other guarantor (including any other Subsidiary Guarantor) of
the Obligations under the Subsidiary Guarantees or any other Person, (2) proceed
against or exhaust any security held from the Company, any such other guarantor
or any other Person, (3) proceed against or have resort to any balance of any
deposit account or credit on the books of any Benefited Party in favor of the
Company or any other Person, or (4) pursue any other remedy in the power of any
Benefited Party whatsoever; (b) any defense arising by reason of the incapacity,
lack of authority or any disability or other defense of the Company including
any defense based on or arising out of the lack of validity or the
unenforceability of the Obligations under the Subsidiary Guarantees or any
agreement or instrument relating thereto or by reason of the cessation of the
liability of the Company from any cause other than payment in full of the
Obligations under the Subsidiary Guarantees; (c) any defense based upon any
statute or rule of law which provides that the obligation of a surety must be
neither larger in amount nor in other respects more burdensome than that of the
principal; (d) any defense based upon any Benefited Party's errors or omissions
in the administration of the Obligations under the Subsidiary Guarantees, except
behavior which amounts to bad faith; (e)(1) any principles or provisions of law,
statutory or otherwise, which are or might be in conflict with the terms of the
Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary
Guarantor's obligations hereunder, (2) the benefit of any statute of limitations
affecting such Subsidiary Guarantor's liability hereunder or the enforcement
hereof, (3) any rights to set-offs, recoupments and counterclaims and (4)
promptness, diligence and any requirement that any Benefited Party protect,
secure, perfect or insure any security interest or lien or any property subject
thereto; (f) notices, demands, presentations, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including acceptance
of the Subsidiary Guarantees, notices of default under the Notes or any
agreement or instrument related thereto, notices of any renewal, extension or
modification of the Obligations under the Subsidiary Guarantees or any agreement
related thereto, and notices of any extension of credit to the Company and any
right to consent to any thereof; (g) to the extent permitted under
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applicable law, the benefits of any "One Action" rule and (h) any defenses or
benefits that may be derived from or afforded by law which limit the liability
of or exonerate guarantors or sureties, or which may conflict with the terms of
the Subsidiary Guarantees. Each Subsidiary Guarantor hereby covenants that its
Subsidiary Guarantee shall not be discharged except by complete performance of
the obligations contained in its Subsidiary Guarantee and this Indenture.
If any Holder or the Trustee is required by any court or otherwise
to return to the Company, the Subsidiary Guarantors or any custodian, trustee,
liquidator or other similar official acting in relation to either the Company or
the Subsidiary Guarantors, any amount paid by either to the Trustee or such
Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall
be reinstated in full force and effect.
Each Subsidiary Guarantor agrees that it shall not be entitled to
any right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the
Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the
other hand, (x) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Section 6.02 hereof for the purposes of this
Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed hereby and
(y) in the event of any declaration of acceleration of such obligations as
provided in Section 6.02 hereof, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Subsidiary Guarantors for
the purpose of this Subsidiary Guarantee. The Subsidiary Guarantors shall have
the right to seek contribution from any non-paying Subsidiary Guarantor so long
as the exercise of such right does not impair the rights of the Holders under
the Subsidiary Guarantee.
Section 10.02. LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.
Each Subsidiary Guarantor, and by its acceptance of Notes, each
Holder, hereby confirms that it is the intention of all such parties that the
Subsidiary Guarantee of such Subsidiary Guarantor not constitute a fraudulent
transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or
state law to the extent applicable to any Subsidiary Guarantee. To effectuate
the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors
hereby irrevocably agree that the obligations of such Subsidiary Guarantor under
this Article 10 shall be limited to the maximum amount as shall, after giving
effect to such maximum amount and all other contingent and fixed liabilities of
such Subsidiary Guarantor that are relevant under such laws, including, if
applicable, its guarantee of all obligations under the Credit Agreement, and
after giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Subsidiary Guarantor in respect of
the obligations of such other Subsidiary Guarantor under this Article 10, result
in the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee
not constituting a fraudulent transfer or conveyance.
Section 10.03. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section 10.01
hereof, each Subsidiary Guarantor hereby agrees that a notation of such
Subsidiary Guarantee in substantially the form included in Exhibit E shall be
endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated
and delivered by the Trustee and that this Indenture shall be executed on behalf
of such Subsidiary Guarantor by its President or one of its Vice Presidents.
Each Subsidiary Guarantor hereby agrees that its Subsidiary
Guarantee set forth in Section 10.01 hereof shall remain in full force and
effect notwithstanding any failure to endorse on each Note a notation of such
Subsidiary Guarantee.
If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.
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The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set
forth in this Indenture on behalf of the Subsidiary Guarantors.
Section 10.04. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
Except as otherwise provided in Section 10.05 hereof, no Subsidiary
Guarantor may sell or otherwise dispose of all or substantially all of its
assets to, or consolidate with or merge with or into (whether or not such
Subsidiary Guarantor is the surviving Person), another Person, other than the
Company or another Subsidiary Guarantor, unless:
(a) immediately after giving effect to that transaction, no Default
or Event of Default exists; and
(b) either:
(i) the Person acquiring the property in any such sale or
disposition or the Person formed by or surviving any such consolidation or
merger (if other than a Subsidiary Guarantor or the Company)
unconditionally assumes all the obligations of such Subsidiary Guarantor,
pursuant to agreements in form and substance reasonably satisfactory to
the Trustee, under this Indenture, the Subsidiary Guarantee and the
Registration Rights Agreement on the terms set forth herein; or
(ii) the Net Proceeds of such sale or other disposition are
applied in accordance with Section 4.12.
In case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor Person, by supplemental indenture, executed
and delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Subsidiary Guarantor, such successor Person shall succeed to
and be substituted for the Subsidiary Guarantor with the same effect as if it
had been named herein as a Subsidiary Guarantor. Such successor Person thereupon
may cause to be signed any or all of the Subsidiary Guarantees to be endorsed
upon all of the Notes issuable hereunder which theretofore shall not have been
signed by the Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of this Indenture as though all of such
Subsidiary Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with
or into the Company or another Subsidiary Guarantor, or shall prevent any sale
or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety to the Company or another Subsidiary Guarantor.
Section 10.05. RELEASES FOLLOWING SALE OF ASSETS.
In the event of any sale or other disposition of all or
substantially all of the assets of any Subsidiary Guarantor (including by way of
merger or consolidation), or any sale of all of the Capital Stock of any
Subsidiary Guarantor, in each case to a Person that is not (either before or
after giving effect to such transactions) a Subsidiary of the Company, if the
sale or other disposition complies with Section 4.12, or if the Company
designates any Restricted Subsidiary that is a Subsidiary Guarantor as an
Unrestricted Subsidiary in accordance with Section 4.17, then such Subsidiary
Guarantor (in the event of a sale of all of the Capital Stock of such Subsidiary
Guarantor or a designation of such Subsidiary Guarantor as an Unrestricted
Subsidiary) or the corporation acquiring the property (in the event of a sale or
other disposition of all or substantially all of the assets of such Subsidiary
Guarantor) shall be released and relieved of any obligations under its
Subsidiary Guarantee. Upon delivery by the Company to the Trustee of an
Officers' Certificate and an Opinion of Counsel to the effect that such sale or
other disposition or designation was made by the Company in accordance with the
provisions of this Indenture, including
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without limitation Section 4.12 or 4.17 hereof, the Trustee shall execute any
documents reasonably required in order to evidence the release of any Subsidiary
Guarantor from its obligations under its Subsidiary Guarantee.
Any Subsidiary Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal of and
interest on the Notes and for the other obligations of any Subsidiary Guarantor
under this Indenture as provided in this Article 10.
ARTICLE 11.
SATISFACTION AND DISCHARGE
Section 11.01. SATISFACTION AND DISCHARGE.
This Indenture will be discharged and will cease to be of further
effect as to all Notes issued hereunder, when:
(a) either:
(i) all Notes that have been authenticated (except lost, stolen or
destroyed Notes that have been replaced or paid and Notes for whose
payment money has theretofore been deposited in trust and thereafter
repaid to the Company) have been delivered to the Trustee for
cancellation; or
(ii) all Notes that have not been delivered to the Trustee for
cancellation have become due and payable by reason of the making of a
notice of redemption or otherwise or will become due and payable within
one year and the Company has irrevocably deposited or caused to be
deposited with the Trustee as trust funds in trust solely for the benefit
of the Holders, cash in U.S. dollars and non-callable Government
Securities, or a combination thereof, in such amounts as will be
sufficient without consideration of any reinvestment of interest, to pay
and discharge the entire indebtedness on the Notes not delivered to the
Trustee for cancellation for principal, premium, if any, and accrued
interest and Additional Interest, if any, to the date of maturity or
redemption;
(b) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or shall occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company or any
Subsidiary Guarantor is a party or by which the Company or any Subsidiary
Guarantor is bound;
(c) the Company has paid or caused to be paid all sums payable by it
under this Indenture; and
(d) the Company has delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money and/or non-callable
Government Securities toward the payment of the Notes at maturity or the
redemption date, as the case may be.
The Company shall deliver an Officers' Certificate and an Opinion of
Counsel to the Trustee stating that all conditions precedent to satisfaction and
discharge have been satisfied.
Section 11.02. DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 11.03 hereof, 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 11.02, the
"Trustee") pursuant to Section 11.01 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium,
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if any, and interest and Additional Interest, if any,, but such money need not
be segregated from other funds except to the extent required by law.
Section 11.03. REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium, if
any, or interest or Additional Interest on any Note and remaining unclaimed for
two years after such principal, and premium, if any, or interest has become due
and payable shall be paid to the Company on its request or (if then held by the
Company) shall be discharged from such trust; and the Holder shall thereafter
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in The New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
ARTICLE 12.
SUBORDINATION
Section 12.01. AGREEMENT TO SUBORDINATE.
The Company and the Subsidiary Guarantors agree, and each Holder by
accepting a Note agrees, that the payment of principal of, premium, if any, and
interest on, and all other amounts payable in respect of, the Notes and the
Subsidiary Guarantees is subordinated in right of payment, to the extent and in
the manner provided in this Article 12 and subject to the provisions of Article
8 hereof, to the payment when due in cash of all Senior Debt of the Company and
the Subsidiary Guarantors and that the subordination is for the benefit of and
enforceable by the holders of such Senior Debt. The Notes and the Subsidiary
Guarantees shall in all respects rank pari passu with any future Senior
Subordinated Indebtedness and senior to all existing and future Subordinated
Debt of the Company and the Subsidiary Guarantors, and only Senior Debt shall
rank senior to the Notes and the Subsidiary Guarantees in accordance with the
provisions set forth herein. All provisions of this Article 12 shall be subject
to Section 12.12.
Section 12.02. LIQUIDATION, DISSOLUTION, BANKRUPTCY.
Upon any payment or distribution of the assets of the Company or the
Subsidiary Guarantors to creditors upon a liquidation, dissolution or winding up
of the Company or the Subsidiary Guarantors, a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to the Company or the
Subsidiary Guarantors or their respective property, an assignment for the
benefit of the Company's or the Subsidiary Guarantors' creditors or the
marshaling of their respective assets and liabilities, the holders of Senior
Debt will be entitled to receive payment in full in cash of all Obligations due
in respect of Senior Debt (including interest after the commencement of any
bankruptcy proceeding at the rate specified in the applicable Senior Debt)
before the Holders of Notes are entitled to receive any payment of principal of,
premium, if any, or interest on, the Notes and the Subsidiary Guarantees, except
that Holders of Notes may receive and retain such payments made in Permitted
Junior Securities and payments made from the trust described in Article 8
hereof.
Until all Senior Debt is paid in full in cash, any distribution to
which Holders of the Notes would be entitled but for this Article 12 will be
made to holders of the Senior Debt as their interests may appear (except that
Holders of Notes may receive and retain payments made in Permitted Junior
Securities and payments and other distributions made from the trust described in
Article 8 hereof; provided that (i) no Holder of Notes shall have the right to
receive and retain any such Permitted Junior Securities if the existence of such
right would have the effect of causing the Notes and the Subsidiary Guarantees
to be treated in the same class of claims as the Senior Debt of the Company and
the Subsidiary Guarantors or any class of claims which is pari passu with such
Senior Debt and (ii) holders of Senior Debt shall be entitled to receive any
cash payments made to any Holder of Notes on the account of Permitted Junior
Securities until all Obligations in respect of Senior Debt have been paid in
full in cash).
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Section 12.03. DEFAULT ON SENIOR DEBT.
The Company and the Subsidiary Guarantors may not pay (except in
Permitted Junior Securities or from the trust described in Article 8 hereof)
principal of, or premium, if any, or interest on, the Notes and the Subsidiary
Guarantees, or make any deposit pursuant to Section 8.04, and may not
repurchase, redeem or otherwise retire any Notes (collectively, "PAY THE NOTES")
if (a) any principal, premium, interest or any other amount payable in respect
of any Senior Debt is not paid within any applicable grace period (including at
maturity) or (b) any other default on Senior Debt occurs and the maturity of
such Senior Debt is accelerated in accordance with its terms unless, in either
case, (1) the default has been cured or waived and any such acceleration has
been rescinded or (2) such Senior Debt has been paid in full in cash; provided,
however, that the Company and the Subsidiary Guarantors may pay the Notes
without regard to the foregoing if the Company and the Trustee receive written
notice approving such payment from the Representative of the holders of such
Senior Debt or, if there is no Representative, from the holders of such Senior
Debt.
During the continuance of any default (other than a default
described in clause (a) or (b) of the preceding sentence) with respect to any
Designated Senior Debt pursuant to which the maturity thereof may be accelerated
immediately without further notice (except any notice required to effect the
acceleration) or the expiration of any applicable grace period, the Company and
the Subsidiary Guarantors may not pay the Notes for a period (a "PAYMENT
BLOCKAGE PERIOD") commencing upon the receipt by the Company and the Trustee of
written notice of such default from the Representative of the holders of such
Designated Senior Debt or, if there is no Representative, from the holders of
such Designated Senior Debt, specifying an election to effect a Payment Blockage
Period (a "PAYMENT BLOCKAGE NOTICE") and ending 179 days thereafter (unless such
Payment Blockage Period is earlier terminated (a) by written notice to the
Trustee and the Company from the Representative of the holders of such
Designated Senior Debt or, if there is no Representative, from the holders of
such Designated Senior Debt that gave such Payment Blockage Notice, (b) because
such default is no longer continuing or (c) because such Designated Senior Debt
has been repaid in full in cash). Not more than one Payment Blockage Notice with
respect to all issues of Designated Senior Debt may be given in any consecutive
360-day period, irrespective of the number of defaults with respect to one or
more issues of Designated Senior Debt during such period. No non-payment default
that existed or was continuing on the date of delivery of any Payment Blockage
Notice to the Trustee shall be the basis for a subsequent Payment Blockage
Notice. Following the expiration of any period during which the Company and the
Subsidiary Guarantors are prohibited from making payments on the Notes and the
Subsidiary Guarantees pursuant to a Payment Blockage Notice, the Company and the
Subsidiary Guarantors shall (unless otherwise prohibited as described in the
first two sentences of this paragraph) resume making any and all required
payments in respect of the Notes and the Subsidiary Guarantees, including,
without limitation, any missed payments, unless the maturity of any Designated
Senior Debt has been accelerated, and such acceleration remains in full force
and effect.
The Company shall give prompt written notice to the Trustee of any
default in the payment of any Senior Debt or any acceleration under any Senior
Debt or under any agreement pursuant to which Senior Debt may have been issued.
Failure to give such notice shall not effect the subordination of the Notes and
the Subsidiary Guarantees to the Senior Debt or the application of the other
provisions provided in this Article 12.
Section 12.04. ACCELERATION OF PAYMENT OF SECURITIES.
If payment of the Notes and the Subsidiary Guarantees is accelerated
when Designated Senior Debt is outstanding, the Company and the Subsidiary
Guarantors may not pay the Notes until three Business Days after the
Representative of the holders of such Designated Senior Debt or, if there is no
Representative, the holders of such Designated Senior Debt receive notice of
such acceleration and, thereafter, may pay the Notes only if this Indenture
otherwise permits payment at that time.
Section 12.05. WHEN DISTRIBUTION MUST BE PAID OVER.
If a payment or distribution is made to Holders of Notes that
because of this Article 12 should not have been made to them, the Trustee or the
Holders who receive the distribution shall hold it in trust for holders of
Senior Debt (pro rata as to each of such holders of Senior Debt on the basis of
the respective amounts of Senior Debt paid to them) and pay it over to them or
their Representative as their interests may appear.
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Section 12.06. SUBROGATION.
After all Senior Debt is paid in full and until the Notes are paid
in full, Holders of Notes shall be subrogated (equally and ratably with all
other Senior Subordinated Indebtedness) to the rights of holders of Senior Debt
to receive distributions applicable to Senior Debt to the extent that
distributions otherwise payable to the Holders have been applied to the payment
of Senior Debt. A distribution made under this Article 12 to holders of Senior
Debt that otherwise would have been made to Holders is not, as between the
Company and the Subsidiary Guarantors and Holders, a payment by the Company and
the Subsidiary Guarantors on such Senior Debt.
Section 12.07. RELATIVE RIGHTS.
This Article 12 defines the relative rights of Holders and holders
of Senior Debt. Nothing in this Indenture shall:
(a) impair, as between the Company and the Subsidiary Guarantors and
Holders of Notes, the obligations of the Company and the Subsidiary Guarantors,
which are absolute and unconditional, to pay principal of, premium, if any, and
interest on, the Notes and the Subsidiary Guarantees in accordance with their
terms;
(b) affect the relative rights of Holders and creditors of the
Company and the Subsidiary Guarantors other than their rights in relation to
holders of Senior Debt; or
(c) prevent the Trustee or any Holder from exercising its available
remedies upon a Default or an Event of Default, subject to the rights of holders
of Senior Debt to receive distributions otherwise payable to Holders.
Section 12.08. SUBORDINATION MAY NOT BE IMPAIRED BY THE COMPANY OR THE
SUBSIDIARY GUARANTORS.
No right of any holder of Senior Debt to enforce the subordination
of the Indebtedness evidenced by the Notes and the Subsidiary Guarantees shall
be impaired by any act or failure to act by the Company or the Subsidiary
Guarantors or by their failure to comply with this Indenture.
Section 12.09. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding Section 12.03, the Trustee or Paying Agent may
continue to make payments on the Notes and the Subsidiary Guarantees and shall
not be charged with knowledge of the existence of facts that would prohibit the
making of any such payments unless, not less than two Business Days prior to the
date of such payment, a Responsible Officer receives notice satisfactory to it
that payments may not be made under this Article 12. The Company, the Registrar,
the Paying Agent, a Representative or a holder of Senior Debt may give the
notice; provided, however, that if an issue of Senior Debt has a Representative,
only the Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior
Debt with the same rights it would have if it were not Trustee. The Registrar
and the Paying Agent may do the same with like rights. The Trustee shall be
entitled to all the rights set forth in this Article 12 with respect to any
Senior Debt that may at any time be held by it to the same extent as any other
holder of such Senior Debt, and nothing in Article 7 shall deprive the Trustee
of any of its rights as such holder. Nothing in this Article 12 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 7.07.
Section 12.10. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders
of Senior Debt, the distribution may be made and the notice given to their
Representative (if any).
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Section 12.11. ARTICLE 12 NOT TO PREVENT EVENTS OF DEFAULT OR LIMIT RIGHT TO
ACCELERATE.
Nothing in this Article 12 shall prevent an Event of Default in
accordance with Article 6 or have any effect on the right of the Holders or the
Trustee to accelerate the maturity of the Notes and the Subsidiary Guarantees or
to exercise the rights and remedies in Article 6.
Section 12.12. TRUST MONEYS NOT SUBORDINATED.
Notwithstanding anything contained herein to the contrary, payments
from cash or the proceeds of non-callable Government Securities held in trust
under Article 8 by the Trustee for the payment of principal of and interest on
the Notes and the Subsidiary Guarantees shall not be subordinated to the prior
payment of any Senior Debt or subject to the restrictions set forth in this
Article 12, and none of the Holders shall be obligated to pay over any such
amount to the Company or the Subsidiary Guarantors or any holder of Senior Debt
or any other creditor of the Company or the Subsidiary Guarantors.
Section 12.13. TRUSTEE ENTITLED TO RELY.
Upon any payment or distribution pursuant to this Article 12, the
Trustee and the Holders shall be entitled to rely upon (a) any order or decree
of a court of competent jurisdiction in which any proceedings of the nature
referred to in Section 12.02 are pending, (b) a certificate of the liquidating
trustee or agent or other Person making such payment or distribution to the
Trustee or to the Holders or (c) a certificate of the Representative of the
holders of Senior Debt or, if there is no Representative, the holders of Senior
Debt for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of Senior Debt and other Indebtedness of
the Company and the Subsidiary Guarantors, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article 12. In the event that the Trustee
determines, in good faith, that evidence is required with respect to the right
of any Person as a holder of Senior Debt to participate in any payment or
distribution pursuant to this Article 12, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of such Senior Debt held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and other facts
pertinent to the rights of such Person under this Article 12, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment. The provisions of Section 7.01 and 7.02 shall be applicable to all
actions or omissions of actions by the Trustee pursuant to this Article 12.
Section 12.14. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder by accepting a Note authorizes and directs the Trustee
on its behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the Holders and the holders
of Senior Debt as provided in this Article 12 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
Section 12.15. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT.
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 it shall
mistakenly pay over or distribute to Holders, the Company or the Subsidiary
Guarantors or any other Person, money or assets to which any holders of Senior
Debt shall be entitled by virtue of this Article 12 or otherwise, except if such
mistake was the result of the Trustee's gross negligence or willful misconduct.
Section 12.16. RELIANCE BY HOLDERS OF SENIOR DEBT ON SUBORDINATION PROVISIONS.
Each Holder by accepting a Note acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Debt, whether such Senior Debt
was created or acquired before or after the issuance of the Notes and the
Subsidiary Guarantees, to acquire and continue to hold, or to continue to hold,
such Senior Debt, and such holder of such Senior
70
Debt shall be deemed conclusively to have relied on such subordination
provisions in acquiring and continuing to hold, or in continuing to hold, such
Senior Debt.
Section 12.17. RANKING WITH RESPECT TO OTHER SENIOR SUBORDINATED INDEBTEDNESS.
The Notes and the Subsidiary Guarantees will rank equally in right
of payment with all Existing Senior Subordinated Indebtedness.
ARTICLE 13.
MISCELLANEOUS
Section 13.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts
with the duties imposed by TIA Section 318(c), the imposed duties shall control.
Section 13.02. NOTICES.
Any notice or communication by the Company or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telecopier or
overnight air courier guaranteeing next-day delivery, to the other's address:
If to the Company:
Extendicare Health Services, Inc.
111 West Michigan Street
Milwaukee, WI 53203
Attention: Chief Financial Officer
Telecopier No.: (414) 908-8111
With a copy to:
Foley & Lardner LLP
777 East Wisconsin Avenue
Milwaukee, WI 53202-5306
Attention: Russell E. Ryba
Telecopier No.: (414) 297-4900
If to the Trustee:
U.S. Bank, N.A.
1555 North RiverCenter Drive, Suite 301
Milwaukee, WI 53212
Attention: Steven J. Peterson
Telecopier No.: (414) 905-5049
The Company or the Trustee, by notice to the others, may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders and
the Trustee) shall be deemed to have been duly given: at the time delivered by
hand, if personally delivered; five Business Days after being deposited in the
mail, postage prepaid, if mailed; when receipt acknowledged, if telecopied; and
the next Business Day after timely delivery to the courier, if sent by overnight
air courier guaranteeing next-day delivery. All notices and communications to
the Trustee shall be deemed duly given and effective only upon receipt.
71
Any notice or communication to a Holder shall be mailed by first
class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next-day delivery to its address shown on the Security
Register. Any notice or communication shall also be so mailed to any Person
described in TIA Section 313(c), to the extent required by the TIA. 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
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 13.03. COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).
Section 13.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall furnish
to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants 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 a certificate
provided pursuant to TIA Section 314(a)(4)) shall comply with the provisions of
TIA Section 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has
made such examination or investigation as is necessary to enable such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
Section 13.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting
of Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
72
Section 13.07. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee, incorporator
or stockholder of the Company or any Subsidiary Guarantor, as such, shall have
any liability for any obligations of the Company or of the Subsidiary Guarantors
under the Notes, this Indenture, the Subsidiary Guarantees or for any claim
based on, in respect of, or by reason of, such obligations or their creation.
Each Holder of Notes by accepting a Note waives and releases all such liability.
The waiver and release are part of the consideration for issuance of the Notes.
Such waiver may not be effective to waive liabilities under the federal
securities laws and it is the view of the SEC that such a waiver is against
public policy.
Section 13.08. GOVERNING LAW.
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED
TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 13.09. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture,
loan or debt agreement of the Company or its Subsidiaries or of any other
Person. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.
Section 13.10. SUCCESSORS.
All covenants and agreements of the Company in this Indenture and
the Notes shall bind its successors. All covenants and agreements of the Trustee
in this Indenture shall bind its successors.
Section 13.11. SEVERABILITY.
In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 13.12. COUNTERPART ORIGINALS.
The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
Section 13.13. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and Headings in this
Indenture have been inserted for convenience of reference only, are not to be
considered a part of this Indenture and shall in no way modify or restrict any
of the terms or provisions hereof.
[Signatures on following page]
73
SIGNATURES
Dated as of April 22, 2004
ISSUER:
EXTENDICARE HEALTH SERVICES, INC.
By:_________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial
Officer and Treasurer
GUARANTORS:
EXTENDICARE HEALTH FACILITY HOLDINGS, INC.
EXTENDICARE HEALTH FACILITIES, INC.
NORTHERN HEALTH FACILITIES, INC.
EXTENDICARE HOMES, INC.
EXTENDICARE HEALTH NETWORK, INC.
THE PROGRESSIVE STEP CORPORATION
EXTENDICARE OF INDIANA, INC.
EXTENDICARE GREAT TRAIL, INC.
FIR LANE TERRACE CONVALESCENT CENTER, INC.
ADULT SERVICES UNLIMITED, INC.
ARBORS EAST, INC.
ARBORS AT TOLEDO, INC.
HEALTH POCONOS, INC.
MARSHALL PROPERTIES, INC.
By:_________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial
Officer and Treasurer
SIGNATURE PAGE TO INDENTURE
INDIANA HEALTH AND REHABILITATION CENTERS PARTNERSHIP
BY: EXTENDICARE HOMES, INC., AS GENERAL PARTNER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
BY: EXTENDICARE OF INDIANA, INC., AS GENERAL PARTNER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
CONCORDIA MANOR, LLC
FIRST COAST HEALTH AND REHABILITATION CENTER, LLC
JACKSON HEIGHTS REHABILITATION CENTER, LLC
TREASURE ISLE CARE CENTER, LLC
BY: EXTENDICARE HOMES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
KAUFMAN STREET, WV, LLC
NEW CASTLE CARE, LLC
BY: FIR LANE TERRACE CONVALESCENT CENTER, INC., AS SOLE
MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
SIGNATURE PAGE TO INDENTURE
75
ALPINE HEALTH AND REHABILITATION CENTER, LLC
COLONIAL CARE, LLC
GREENBRIAR CARE, LLC
GREENBROOK CARE, LLC
HERITAGE CARE, LLC
LADY LAKE CARE, LLC
NEW HORIZON CARE, LLC
NORTH REHABILITATION CARE, LLC
PALM COURT CARE, LLC
RICHEY MANOR, LLC
ROCKLEDGE CARE, LLC
SOUTH HERITAGE HEALTH AND REHABILITATION CENTER,
LLC
THE OAKS RESIDENTIAL AND REHABILITATION CENTER, LLC
WINTER HAVEN HEALTH AND REHABILITATION CENTER, LLC
BY: EXTENDICARE HEALTH FACILITIES, INC., AS SOLE MEMBER
By:____________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
SIGNATURE PAGE TO INDENTURE
76
ARBORS AT TAMPA, LLC
ARBORS AT BAYONET POINT, LLC
ARBORS AT FAIRLAWN CARE, LLC
ARBORS AT FAIRLAWN REALTY OH, LLC
ARBORS AT SYLVANIA CARE, LLC
ARBORS AT SYLVANIA REALTY OH, LLC
ARBORS WEST CARE, LLC
ARBORS WEST REALTY OH, LLC
COLUMBUS REHABILITATION REALTY OH, LLC
JACKSONVILLE CARE, LLC
SAFETY HARBOR CARE, LLC
KISSIMMEE CARE, LLC
ORANGE PARK CARE, LLC
OREGON CARE, LLC
PORT CHARLOTTE CARE, LLC
SARASOTA CARE, LLC
SEMINOLE CARE, LLC
WINTER HAVEN CARE, LLC
BLANCHESTER CARE, LLC
CANTON CARE, LLC
COLUMBUS REHABILITATION CARE, LLC
DAYTON CARE, LLC
DELAWARE CARE, LLC
GALLIPOLIS CARE, LLC
HILLIARD CARE, LLC
LONDON CARE, LLC
MARIETTA CARE, LLC
ROCKMILL CARE, LLC
ROCKSPRINGS CARE, LLC
WATERVILLE CARE, LLC
WOODSFIELD CARE, LLC
BY: NORTHERN HEALTH FACILITIES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
SIGNATURE PAGE TO INDENTURE
77
GREAT TRAIL CARE, LLC
BY: EXTENDICARE GREAT TRAIL, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
FISCAL SERVICES GROUP, LLC
PARTNERS HEALTH GROUP, LLC
STAR PURCHASING SERVICES, LLC
BY: EXTENDICARE HEALTH NETWORK, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
MILFORD CARE, LLC
PRAIRIE VILLAGE CARE, LLC
SCOTT VILLA CARE, LLC
SWISS VILLA CARE, LLC
VILLA PINES CARE, LLC
BY: MARSHALL PROPERTIES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
SIGNATURE PAGE TO INDENTURE
78
PARTNERS HEALTH GROUP - FLORIDA, LLC
PARTNERS HEALTH GROUP - LOUISIANA, LLC
PARTNERS HEALTH GROUP - TEXAS, LLC
BY: PARTNERS HEALTH GROUP, LLC
BY: EXTENDICARE HEALTH NETWORK, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
SIGNATURE PAGE TO INDENTURE
79
TRUSTEE:
U.S. BANK, N.A.
By: ________________________________________________
Name: Steven J. Peterson
Title: Assistant Vice President
SIGNATURE PAGE TO INDENTURE
80
EXHIBIT A
================================================================================
(Face of Note)
6 7/8% SENIOR SUBORDINATED NOTES DUE 2014
CUSIP _____________
NO. $_____________
EXTENDICARE HEALTH SERVICES, INC.
promises to pay to CEDE & CO., INC. or registered assigns, the principal sum of
_________________ Dollars ($______________) on May 1, 2014.
Interest Payment Dates: May 1 and November 1, commencing November 1, 2004.
Record Dates: April 15 and October 15.
Dated: ______________, 20__.
A-1
IN WITNESS WHEREOF, the Issuer has caused this Note to be signed
manually or by facsimile by its duly authorized officer.
EXTENDICARE HEALTH SERVICES, INC.
By:_________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial
Officer and Treasurer
This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:
U.S. Bank, N.A.,
as Trustee
By:___________________________
Authorized Signatory
Dated _____________, 20__
A-2
(Back of Note)
6 7/8% Senior Subordinated Notes due 2014
[Insert the Global Note Legend, if applicable pursuant to the terms of the
Indenture]
[Insert the Private Placement Legend, if applicable pursuant to the terms of the
Indenture]
Capitalized terms used herein shall have the meanings assigned to
them in the Indenture referred to below unless otherwise indicated.
1. INTEREST. Extendicare Health Services, Inc., a Delaware corporation
(the "ISSUER"), promises to pay interest on the principal amount of this Note at
6 7/8% per annum until maturity and shall pay Additional Interest, if any, as
provided in Section 5 of the Registration Rights Agreement. The Issuer shall pay
interest semi-annually on May 1 and November 1 of each year, or if any such day
is not a Business Day, on the next succeeding Business Day (each an "INTEREST
PAYMENT DATE"). Interest on the Notes shall accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided, however, that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be the first of May 1 or November 1 to
occur after the date of issuance, unless such May 1 or November 1 occurs within
one calendar month of such date of issuance, in which case the first Interest
Payment Date shall be the second of May 1 and November 1 to occur after the date
of issuance. The Issuer shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal and premium, if
any, from time to time on demand at a rate that is 1% per annum in excess of the
interest rate then in effect under the Indenture and this Note; it shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.
2. METHOD OF PAYMENT. The Issuer shall pay interest on the Notes (except
defaulted interest) to the Persons who are Holders at the close of business on
the April 15 or October 15 next preceding the Interest Payment Date, even if
such Notes are cancelled after such record date and on or before such Interest
Payment Date, except as provided in Section 2.12 of the Indenture with respect
to defaulted interest. The Notes shall be payable as to principal, premium, if
any, and interest and Additional Interest, if any, at the office or agency of
the Issuer maintained for such purpose, or, at the option of the Issuer, payment
of interest may be made by check mailed to the Holders at their addresses set
forth in the Security Register; provided, however, that payment by wire transfer
of immediately available funds shall be required with respect to principal of
and interest and Additional Interest, if any, and premium, if any, on, all
Global Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Issuer or the Paying Agent. Such payment shall be
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.
3. PAYING AGENT AND REGISTRAR. Initially, U.S. Bank, N.A., the Trustee
under the Indenture, shall act as Paying Agent and Registrar. The Issuer may
change any Paying Agent or Registrar without notice to any Holder. The Issuer or
any of its Subsidiaries may act in any such capacity.
4. INDENTURE. The Issuer issued the Notes under an Indenture dated as of
April 22, 2004 ("INDENTURE") among the Issuer, the subsidiary guarantors party
thereto (the "GUARANTORS") and the Trustee. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb).
The Notes are subject to all such terms, and Holders are referred to the
Indenture and such Act for a statement of such terms. To the extent any
provision of this Note conflicts with the express provisions of the Indenture,
the provisions of the Indenture shall govern and be controlling. The Notes are
obligations of the Issuer unlimited in aggregate principal amount.
A-3
5. MATURITY. The principal on the Notes shall be due and payable on May 1,
2014.
6. OPTIONAL REDEMPTION.
(a) Except as set forth in clause (b) of this Paragraph 6, the Notes will
not be redeemable at the option of the Issuer prior to May 1, 2009. Starting on
that date, the Issuer may redeem all or any portion of the Notes, at once or
over time, after giving the required notice under the Indenture. The Notes may
be redeemed at the redemption prices (expressed as percentages of principal
amount) set forth below, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject to the right of Holders on the
relevant record date to receive interest due on the relevant Interest Payment
Date), if redeemed during the twelve-month period commencing on May 1 of the
years indicated below:
Year Percentage
- ---- ----------
2009.................... 103.438%
2010.................... 102.292%
2011.................... 101.146%
2012 and thereafter..... 100.000%
(b) At any time and from time to time, prior to May 1, 2007, the Issuer
may redeem up to 35% of the aggregate principal amount of the Notes issued under
the Indenture at a redemption price equal to 106.875% of the principal amount
thereof, plus accrued and unpaid interest and Additional Interest, if any, to
the redemption date (subject to the right of Holders on the relevant record date
to receive interest due on the relevant Interest Payment Date) with the net cash
proceeds of any Qualified Equity Offering; provided, however, that after giving
effect to any such redemption, at least 65% of the aggregate principal amount of
the Notes issued under the Indenture remains outstanding. Any such redemption
shall be made within 120 days of the closing of such Qualified Equity Offering
upon not less than 30 nor more than 60 days' prior notice.
(c) Any prepayment pursuant to this paragraph shall be made pursuant to
the provisions of Sections 3.01 through 3.06 of the Indenture.
7. MANDATORY REDEMPTION. The Issuer shall not be required to make
mandatory redemption or sinking fund payments with respect to the Notes.
8. REPURCHASE AT OPTION OF HOLDER.
(a) Upon the occurrence of a Change of Control, each Holder shall have
the right to require the Issuer to repurchase all or any part (equal to $1,000
or an integral multiple of $1,000) of such Holder's Notes (a "CHANGE OF CONTROL
OFFER") at a purchase price equal to 101% of the principal amount thereof, plus
accrued and unpaid interest and Additional Interest, if any, to the purchase
date (subject to the right of Holders on the relevant record date to receive
interest due on the relevant Interest Payment Date).
(b) If the Issuer or one of its Restricted Subsidiaries consummates any
Asset Sales, when the aggregate amount of Excess Proceeds exceeds $15.0 million,
not later than 30 days after such date, the Issuer shall commence an offer to
all Holders of Notes and Additional Notes, if any, and all holders of other
Indebtedness that is pari passu with the Notes containing provisions similar to
those set forth in the Indenture with respect to offers to purchase or redeem
with the proceeds of sales of assets (an "ASSET SALE OFFER") pursuant to Section
3.09 of the Indenture to purchase, on a pro rata basis, the maximum principal
amount of Notes (including any Additional Notes) and such other pari passu
Indebtedness equal in amount to the Excess Proceeds remaining after an asset
sale offer required to be commenced prior to the Asset Sale Offer (and not just
the amount thereof that exceeds $15.0 million) at an offer price in cash equal
to 100% of the principal amount thereof plus accrued and unpaid interest and
Additional Interest, if any, to the date of purchase, in accordance with the
procedures set forth in the Indenture, and shall be payable in cash. If any
Excess Proceeds remain after consummation of an Asset Sale Offer, the Issuer may
use those Excess Proceeds for any purpose not otherwise prohibited by the
Indenture. If the aggregate principal amount of Notes and Additional Notes, if
any, and other pari passu Indebtedness surrendered by holders thereof exceeds
the amount of
A-4
Excess Proceeds remaining after an asset sale offer required to be commenced
prior to the Asset Sale Offer, the Trustee shall select the Notes and Additional
Notes, if any, and other pari passu Indebtedness to be purchased on a pro rata
basis. Holders of Notes that are the subject of an offer to purchase will
receive an Asset Sale Offer from the Issuer prior to any related purchase date
and may elect to have such Notes purchased by completing the form entitled
"Option of Holder to Elect Purchase" on the reverse of the Notes.
8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least 30
days but not more than 60 days before the redemption date to each Holder whose
Notes are to be redeemed at its registered address. Notes in denominations
larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000, unless all of the Notes held by a Holder are to be redeemed. On and
after the redemption date interest ceases to accrue on Notes or portions thereof
called for redemption.
9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Issuer may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Issuer need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Issuer need
not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.
10. PERSONS DEEMED OWNERS. The registered holder of a Note may be treated
as its owner for all purposes.
11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the
Issuer and the Trustee may amend or supplement the Indenture or the Notes with
the consent of the Holders of at least a majority in principal amount of the
then outstanding Notes voting as a single class, and any existing default or
compliance with any provision of the Indenture or the Notes may be waived with
the consent of the Holders of a majority in principal amount of the then
outstanding Notes voting as a single class. Without the consent of any Holder,
the Issuer and the Trustee may amend or supplement the Indenture or the Notes to
cure any ambiguity, defect or inconsistency, to provide for the assumption by a
successor corporation of the obligations of the Issuer under the Indenture in
the case of a merger or consolidation or sale of all or substantially all of the
assets of the Issuer, provide for uncertificated Notes in addition to or in
place of certificated Notes, to make any change that would provide any
additional rights or benefits to the Holders of Notes or that does not adversely
affect the legal rights under the Indenture of any such Holder, or to make any
change to comply with any requirement of the SEC in order to effect or maintain
the qualification of the Indenture under the TIA.
12. DEFEASANCE PRIOR TO MATURITY. Subject to certain conditions, the
Issuer at any time may terminate some or all of its obligations under the Notes
and the Indenture if the Issuer deposits with the Trustee for the benefit of the
Holders of the Notes, cash in U.S. dollars, non-callable Government Securities
or a combination of cash in U.S. dollars and non-callable Government Securities,
in amounts as will be sufficient, in the opinion of a nationally recognized firm
of independent public accountants, to pay the principal of, and interest and
premium and Additional Interest, if any, on the Notes on the Stated Maturity or
on the applicable redemption date, as the case may be.
13. DEFAULTS AND REMEDIES. Each of the following is an Event of Default
under the Indenture: (1) default for 30 days in the payment when due of interest
on, or Additional Interest with respect to, the Notes (whether or not prohibited
by Article 12 of the Indenture); (2) default in payment when due of principal
of, or premium, if any, on the Notes (whether or not prohibited by Article 12 of
the Indenture); (3) failure by the Issuer or any of its Restricted Subsidiaries
to comply with Sections 4.09 or 4.10 or Article 5 of the Indenture; (4) failure
by the Issuer or any of its Restricted Subsidiaries for 30 days after notice to
comply with Section 4.12 or 4.18; (5) failure by the Issuer or any of its
Restricted Subsidiaries for 60 days after notice to comply with any other
covenant or agreement in the Notes or in the Indenture; (6) default under any
mortgage, indenture or instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness 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
Indebtedness or guarantee now exists, or is created after the date of the
Indenture, if that default (A) is
A-5
caused by a failure to pay principal of, or interest or premium, if any, on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "PAYMENT DEFAULT"); or (B) results
in the acceleration of such Indebtedness prior to its express maturity, and, in
each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$20.0 million or more; (7) failure by the Issuer or any of its Restricted
Subsidiaries to pay final judgments (to the extent not fully covered by
insurance) aggregating in excess of $20.0 million, which judgments are not paid,
discharged or stayed for a period of 60 consecutive days; (8) except as
permitted by the Indenture, any Subsidiary Guarantee shall be held in any
judicial proceeding to be unenforceable or invalid or shall cease for any reason
to be in full force and effect or any Subsidiary Guarantor, or any Person acting
on behalf of any Subsidiary Guarantor, shall deny or disaffirm its obligations
under its Subsidiary Guarantee; and (9) certain events of bankruptcy or
insolvency described in the Indenture with respect to the Issuer or any of its
Significant Subsidiaries. If any Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable.
Notwithstanding the foregoing, in the case of an Event of Default arising from
certain events of bankruptcy or insolvency described in the Indenture, all
outstanding Notes shall become due and payable without further action or notice.
Holders may not enforce the Indenture or the Notes except as provided in the
Indenture. Subject to certain limitations, Holders of a majority in aggregate
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders notice of
any continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest or Additional Interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest or
Additional Interest on, or the principal of, the Notes. The Issuer is required
to deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Issuer is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.
14. TRUSTEE DEALINGS WITH ISSUER. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Issuer or its Affiliates, and may otherwise deal with the Issuer or its
Affiliates, as if it were not the Trustee.
15. SUBORDINATION. The payment of principal of, premium, if any, and
interest on, and all other amounts payable in respect of, this Notes is
subordinated in right of payment to the payment when due in cash of all Senior
Debt of the Company as set forth in Article 12 of the Indenture.
16. NO RECOURSE AGAINST OTHERS. No director, officer, employee,
incorporator or stockholder of the Issuer or of any Subsidiary Guarantor, as
such, shall have any liability for any obligations of the Issuer or any
Subsidiary Guarantor under the Indenture, the Notes, the Subsidiary Guarantees
or for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes; such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the SEC that such a waiver is
against public policy.
17. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
18. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
19. 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 Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
A-6
The Issuer shall furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to:
Extendicare Health Services, Inc.
111 West Michigan Street
Milwaukee, WI 53203
Attention: Chief Financial Officer
A-7
Option of Holder to Elect Purchase
If you want to elect to have this Note purchased by the Issuer pursuant to
Section 4.12 or 4.18 of the Indenture, check the box below:
[ ] Section 4.12
[ ] Section 4.18
If you want to elect to have only part of the Note purchased by the Issuer
pursuant to Section 4.12 or Section 4.18 of the Indenture, state the amount you
elect to have purchased: $_____________________
Date:___________________ Your Signature:________________________________
(Sign exactly as your name appears on the Note)
Tax Identification No.:
___________________________________________________
SIGNATURE GUARANTEE:
___________________________________________________
Signatures must be guaranteed by an "eligible
guarantor institution" meeting the requirements of
the Registrar, which requirements include membership
or participation in the Security Transfer Agent
Medallion Program ("STAMP") or such other "signature
guarantee program" as may be determined by the
Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange
Act of 1934, as amended.
A-8
ASSIGNMENT FORM
To assign this Note, fill in the form below:
(I) or (we) assign and transfer this Note to
________________________________________________________________________________
(Insert assignee's soc. sec. or other tax I.D. no.)
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_________________________________________________________
as agent to transfer this Note on the books of the Issuer. The agent may
substitute another to act for him.
________________________________________________________________________________
Date: ______________
Your Signature:______________________________________
(Sign exactly as your name appears on the face of
this Note)
Signature Guarantee:_________________________________
A-9
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE
The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:
Principal Amount
Amount of of this Global Note Signature of
decrease in Amount of increase following such authorized signatory
Principal Amount in Principal Amount decrease (or of Trustee or
Date of Exchange of this Global Note of this Global Note increase) Note Custodian
- ---------------- ------------------- ------------------- ------------------- --------------------
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Extendicare Health Services, Inc.
111 West Michigan Street
Milwaukee, WI 53203
Attention: Chief Financial Officer
U.S. Bank, N.A.
1555 North RiverCenter Drive, Suite 301
Milwaukee, WI 53212
Attention: Corporate Trust Department
Telecopier No.: (414) 905-5049
Re: 6 7/8% Senior Subordinated Notes due 2014
Reference is hereby made to the Indenture, dated as of April 22,
2004 (the "Indenture"), among Extendicare Health Services, Inc., as issuer (the
"Issuer"), the Subsidiary Guarantors party thereto and U.S. Bank, N.A., as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
___________________, (the "Transferor") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of $___________ in such Note[s] or interests (the
"Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE 144A GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO RULE 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.
2. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE REGULATION S GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO
REGULATION S. The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a Person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(a) of Regulation S under the Securities Act, (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act and (iv) if the proposed transfer is being made prior to the
expiration of the Distribution Compliance Period, the transfer is not being made
to a U.S. Person or for the account or benefit of a U.S. Person (other than an
Initial Purchaser). Upon consummation of the proposed transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will be subject to the restrictions on
B-1
Transfer enumerated in the Private Placement Legend printed on the Regulation S
Global Note, the Temporary Regulation S Global Note and/or the Definitive Note
and in the Indenture and the Securities Act.
3. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI GLOBAL NOTE OR A DEFINITIVE NOTE PURSUANT TO ANY
PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the Issuer or a
subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to an
effective registration statement under the Securities Act and in
compliance with the prospectus delivery requirements of the Securities
Act;
or
(d) [ ] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule
904, and the Transferor hereby further certifies that it has not engaged
in any general solicitation within the meaning of Regulation D under the
Securities Act and the Transfer complies with the transfer restrictions
applicable to beneficial interests in a Restricted Global Note or
Restricted Definitive Notes and the requirements of the exemption claimed,
which certification is supported by (1) a certificate executed by the
Transferee in the form of Exhibit D to the Indenture and (2) if such
Transfer is in respect of a principal amount of Notes at the time of
transfer of less than $250,000, an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor has attached
to this certification), to the effect that such Transfer is in compliance
with the Securities Act. Upon consummation of the proposed transfer in
accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the IAI
Global Note and/or the Definitive Notes and in the Indenture and the
Securities Act.
4. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL NOTE OR OF AN UNRESTRICTED DEFINITIVE NOTE.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Indenture and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained in
the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in
B-2
accordance with the terms of the Indenture, the transferred beneficial interest
or Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.
(c) [ ]CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Issuer.
__________________________________________
[Insert Name of Transferor]
By: _____________________________________
Name:
Title:
Dated:_____________________________
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. [ ] The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note.
2. [ ] After the Transfer the Transferee will hold:
[CHECK ONE OF (a), (b) OR (c)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Note (CUSIP _________), or
(ii) [ ] Regulation S Global Note (CUSIP _________), or
(iii) [ ] IAI Global Note (CUSIP _________); or
(iv) [ ] Unrestricted Global Note (CUSIP _________); or
(b) [ ] a Restricted Definitive Note; or
(c) [ ] an Unrestricted Definitive Note,
in accordance with the terms of the Indenture.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Extendicare Health Services, Inc.
111 West Michigan Street
Milwaukee, WI 53203
Attention: Chief Financial Officer
U.S. Bank, N.A.
1555 North RiverCenter Drive, Suite 301
Milwaukee, WI 53212
Attention: Corporate Trust Department
Telecopier No.: (414) 905-5049
Re: 6 7/8% Senior Subordinated Notes due 2014
Reference is hereby made to the Indenture, dated as of April 22,
2004 (the "Indenture"), among Extendicare Health Services, Inc., as issuer (the
"Issuer"), the Subsidiary Guarantors party thereto and U.S. Bank, N.A., as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
__________________________, (the "Owner") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of $____________ in such Note[s] or interests (the "Exchange").
In connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN A RESTRICTED GLOBAL NOTE FOR UNRESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN AN UNRESTRICTED GLOBAL NOTE
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Restricted Global Note and pursuant to and in accordance with the United States
Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted
Definitive Note is being acquired for the Owner's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Note and pursuant to and in
accordance with the Securities Act, (iii) the restrictions on transfer contained
in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Unrestricted Definitive
Note is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without
C-1
transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE NOTES OR BENEFICIAL INTERESTS
IN RESTRICTED GLOBAL NOTES FOR RESTRICTED DEFINITIVE NOTES OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL NOTES
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the Exchange
of the Owner's Restricted Definitive Note for a beneficial interest in the
[CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an
equal principal amount, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer and (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Definitive Note and pursuant to and in accordance
with the Securities Act, and in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the beneficial
interest issued will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the relevant Restricted Global Note and
in the Indenture and the Securities Act.
C-2
This certificate and the statements contained herein are made for
your benefit and the benefit of the Issuer.
__________________________________________
[Insert Name of Transferor]
By: _____________________________________
Name:
Title:
Dated:_____________________________
C-3
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Extendicare Health Services, Inc.
111 West Michigan Street
Milwaukee, WI 53203
Attention: Chief Financial Officer
U.S. Bank, N.A.
1555 North RiverCenter Drive, Suite 301
Milwaukee, WI 53212
Attention: Corporate Trust Department
Telecopier No.: (414) 905-5049
Re: 6 7/8% Senior Subordinated Notes due 2014
Reference is hereby made to the Indenture, dated as of April 22,
2004 (the "Indenture"), among Extendicare Health Services, Inc., as issuer (the
"Issuer"), the Subsidiary Guarantors party thereto and U.S. Bank, N.A., as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.
In connection with our proposed purchase of $____________ aggregate
principal amount of:
(a) [ ] a beneficial interest in a Global Note, or
(b) [ ] a Definitive Note,
we confirm that:
1. We understand that any subsequent transfer of the Notes or any
interest therein is subject to certain restrictions and conditions set forth in
the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes and any interest therein
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 the Notes or any interest therein,
we will do so only (A) to the Issuer or any subsidiary thereof, (B) in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) 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 you and to the Issuer a signed letter
substantially in the form of this letter and, if such transfer is in respect of
a principal amount of Notes, at the time of transfer of less than $250,000, an
Opinion of Counsel in form reasonably acceptable to the Issuer to the effect
that such transfer is in compliance with the Securities Act, (D) outside the
United States in accordance with Rule 904 of Regulation S under the Securities
Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or
(F) pursuant to an effective registration statement under the Securities Act,
and we further agree to provide to any Person purchasing the Definitive Note or
beneficial interest in a Global Note from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Issuer such certifications, legal opinions and other information as you and the
Issuer may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Notes purchased by us
will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
D-1
5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Issuer are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
__________________________________________
[Insert Name of Transferor]
By: _____________________________________
Name:
Title:
Dated:_____________________________
D-2
EXHIBIT E
FORM OF NOTATION OF GUARANTEE
For value received, each Subsidiary Guarantor (which term includes
any successor Person under the Indenture), jointly and severally,
unconditionally guarantees, to the extent set forth in the Indenture and subject
to the provisions in the Indenture, dated as of April 22, 2004 (the
"Indenture"), among Extendicare Health Services, Inc., as issuer (the "Issuer"),
the Subsidiary Guarantors listed on the signature pages thereto and U.S. Bank,
N.A., as trustee (the "Trustee"), (a) the due and punctual payment of the
principal of, premium, if any, and interest on the Notes (as defined in the
Indenture), whether at maturity, by acceleration, redemption or otherwise, the
due and punctual payment of interest on overdue principal and premium, if any,
and, to the extent permitted by law, interest, and the due and punctual
performance of all other obligations of the Issuer to the Holders or the Trustee
all in accordance with the terms of the Indenture and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other
obligations, that the same will be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. The obligations of the Subsidiary
Guarantors to the Holders of Notes and to the Trustee pursuant to the Subsidiary
Guarantee and the Indenture are expressly set forth in Article 10 of the
Indenture and reference is hereby made to the Indenture for the precise terms of
the Subsidiary Guarantee. This Subsidiary Guarantee is subject to release as and
to the extent set forth in Section 10.05 of the Indenture. The payment of any
amount in respect of this Subsidiary Guarantee is subordinated in right of
payment to the payment when due in cash of all Senior Debt of the Subsidiary
Guarantors as set forth in Article 12 of the Indenture. Each Holder of a Note,
by accepting the same agrees to and shall be bound by such provisions.
EXTENDICARE HEALTH FACILITY HOLDINGS, INC.
EXTENDICARE HEALTH FACILITIES, INC.
NORTHERN HEALTH FACILITIES, INC.
EXTENDICARE HOMES, INC.
EXTENDICARE HEALTH NETWORK, INC.
THE PROGRESSIVE STEP CORPORATION
EXTENDICARE OF INDIANA, INC.
EXTENDICARE GREAT TRAIL, INC.
FIR LANE TERRACE CONVALESCENT CENTER, INC.
ADULT SERVICES UNLIMITED, INC.
ARBORS EAST, INC.
ARBORS AT TOLEDO, INC.
HEALTH POCONOS, INC.
MARSHALL PROPERTIES, INC.
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
INDIANA HEALTH AND REHABILITATION CENTERS PARTNERSHIP
BY: EXTENDICARE HOMES, INC., AS GENERAL PARTNER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
BY: EXTENDICARE OF INDIANA, INC., AS GENERAL PARTNER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
CONCORDIA MANOR, LLC
FIRST COAST HEALTH AND REHABILITATION CENTER, LLC
JACKSON HEIGHTS REHABILITATION CENTER, LLC
TREASURE ISLE CARE CENTER, LLC
BY: EXTENDICARE HOMES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
KAUFMAN STREET, WV, LLC
NEW CASTLE CARE, LLC
BY: FIR LANE TERRACE CONVALESCENT CENTER, INC., AS SOLE
MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
ALPINE HEALTH AND REHABILITATION CENTER, LLC
COLONIAL CARE, LLC
GREENBRIAR CARE, LLC
GREENBROOK CARE, LLC
HERITAGE CARE, LLC
LADY LAKE CARE, LLC
NEW HORIZON CARE, LLC
NORTH REHABILITATION CARE, LLC
PALM COURT CARE, LLC
RICHEY MANOR, LLC
ROCKLEDGE CARE, LLC
SOUTH HERITAGE HEALTH AND REHABILITATION CENTER, LLC
THE OAKS RESIDENTIAL AND REHABILITATION CENTER, LLC
WINTER HAVEN HEALTH AND REHABILITATION CENTER, LLC
BY: EXTENDICARE HEALTH FACILITIES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
ARBORS AT TAMPA, LLC
ARBORS AT BAYONET POINT, LLC
ARBORS AT FAIRLAWN CARE, LLC
ARBORS AT FAIRLAWN REALTY OH, LLC
ARBORS AT SYLVANIA CARE, LLC
ARBORS AT SYLVANIA REALTY OH, LLC
ARBORS WEST CARE, LLC
ARBORS WEST REALTY OH, LLC
COLUMBUS REHABILITATION REALTY OH, LLC
JACKSONVILLE CARE, LLC
SAFETY HARBOR CARE, LLC
KISSIMMEE CARE, LLC
ORANGE PARK CARE, LLC
OREGON CARE, LLC
PORT CHARLOTTE CARE, LLC
SARASOTA CARE, LLC
SEMINOLE CARE, LLC
WINTER HAVEN CARE, LLC
BLANCHESTER CARE, LLC
CANTON CARE, LLC
COLUMBUS REHABILITATION CARE, LLC
DAYTON CARE, LLC
DELAWARE CARE, LLC
GALLIPOLIS CARE, LLC
HILLIARD CARE, LLC
LONDON CARE, LLC
MARIETTA CARE, LLC
ROCKMILL CARE, LLC
ROCKSPRINGS CARE, LLC
WATERVILLE CARE, LLC
WOODSFIELD CARE, LLC
BY: NORTHERN HEALTH FACILITIES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Mark W. Durishan
Title: Vice President, Chief Financial Officer and
Treasurer
GREAT TRAIL CARE, LLC
BY: EXTENDICARE GREAT TRAIL, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
FISCAL SERVICES GROUP, LLC
PARTNERS HEALTH GROUP, LLC
STAR PURCHASING SERVICES, LLC
BY: EXTENDICARE HEALTH NETWORK, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
MILFORD CARE, LLC
PRAIRIE VILLAGE CARE, LLC
SCOTT VILLA CARE, LLC
SWISS VILLA CARE, LLC
VILLA PINES CARE, LLC
BY: MARSHALL PROPERTIES, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
PARTNERS HEALTH GROUP - FLORIDA, LLC
PARTNERS HEALTH GROUP - LOUISIANA, LLC
PARTNERS HEALTH GROUP - TEXAS, LLC
BY: PARTNERS HEALTH GROUP, LLC
BY: EXTENDICARE HEALTH NETWORK, INC., AS SOLE MEMBER
By:__________________________________________________
Name: Richard L. Bertrand
Title: Senior Vice President - Development
TABLE OF CONTENTS
PAGE
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE......................................... 1
Section 1.01. Definitions................................................................. 1
Section 1.02. Other Definitions........................................................... 17
Section 1.03. Incorporation by Reference of Trust Indenture Act........................... 17
Section 1.04. Rules of Construction....................................................... 18
ARTICLE 2. THE NOTES.......................................................................... 18
Section 2.01. Form and Dating............................................................. 18
Section 2.02. Execution and Authentication................................................ 19
Section 2.03. Registrar and Paying Agent.................................................. 19
Section 2.04. Paying Agent to Hold Money in Trust......................................... 20
Section 2.05. Holder Lists................................................................ 20
Section 2.06. Transfer and Exchange....................................................... 20
Section 2.07. Replacement Notes........................................................... 30
Section 2.08. Outstanding Notes........................................................... 30
Section 2.09. Treasury Notes.............................................................. 30
Section 2.10. Temporary Notes............................................................. 30
Section 2.11. Cancellation................................................................ 30
Section 2.12. Defaulted Interest.......................................................... 31
Section 2.13. CUSIP or ISIN Numbers....................................................... 31
Section 2.14. Additional Interest......................................................... 31
ARTICLE 3. REDEMPTION AND PREPAYMENT.......................................................... 32
Section 3.01. Notices to Trustee.......................................................... 32
Section 3.02. Selection of Notes to Be Redeemed........................................... 32
Section 3.03. Notice of Redemption........................................................ 32
Section 3.04. Effect of Notice of Redemption.............................................. 33
Section 3.05. Deposit of Redemption Price................................................. 33
Section 3.06. Notes Redeemed in Part...................................................... 33
Section 3.07. Optional Redemption......................................................... 33
Section 3.08. Mandatory Redemption........................................................ 34
Section 3.09. Offer To Purchase by Application of Excess Proceeds......................... 34
ARTICLE 4. COVENANTS.......................................................................... 35
Section 4.01. Payment of Notes............................................................ 35
Section 4.02. Maintenance of Office or Agency............................................. 36
Section 4.03. Reports..................................................................... 36
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Section 4.04. Compliance Certificate...................................................... 37
Section 4.05. Taxes....................................................................... 37
Section 4.06. Stay, Extension and Usury Laws.............................................. 37
Section 4.07. Corporate Existence......................................................... 38
Section 4.08. Payments for Consent........................................................ 38
Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Stock.................. 38
Section 4.10. Restricted Payments......................................................... 40
Section 4.11. Liens....................................................................... 42
Section 4.12. Asset Sales................................................................. 42
Section 4.13. Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries... 44
Section 4.14. Transactions with Affiliates................................................ 45
Section 4.15. [Reserved.]................................................................. 46
Section 4.16. [Reserved.]................................................................. 46
Section 4.17. Designation of Restricted and Unrestricted Subsidiaries..................... 46
Section 4.18. Repurchase at the Option of Holders Upon a Change of Control................ 46
Section 4.19. Additional Subsidiary Guarantees............................................ 48
Section 4.20. [Reserved.]................................................................. 48
Section 4.21. Business Activities......................................................... 48
ARTICLE 5. SUCCESSORS......................................................................... 48
Section 5.01. Merger, Consolidation, or Sale of Property.................................. 48
Section 5.02. Successor Corporation Substituted........................................... 49
ARTICLE 6. DEFAULTS AND REMEDIES.............................................................. 49
Section 6.01. Events of Default........................................................... 49
Section 6.02. Acceleration................................................................ 50
Section 6.03. Other Remedies.............................................................. 51
Section 6.04. Waiver of Past Defaults..................................................... 51
Section 6.05. Control by Majority......................................................... 51
Section 6.06. Limitation on Suits......................................................... 52
Section 6.07. Rights of Holders to Receive Payment........................................ 52
Section 6.08. Collection Suit by Trustee.................................................. 52
Section 6.09. Trustee May File Proofs of Claim............................................ 52
Section 6.10. Priorities.................................................................. 53
Section 6.11. Undertaking for Costs....................................................... 53
ARTICLE 7. TRUSTEE............................................................................ 53
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Section 7.01. Duties of Trustee........................................................... 53
Section 7.02. Rights of Trustee........................................................... 54
Section 7.03. Individual Rights of Trustee................................................ 55
Section 7.04. Trustee's Disclaimer........................................................ 55
Section 7.05. Notice of Defaults.......................................................... 55
Section 7.06. Reports by Trustee to Holders............................................... 55
Section 7.07. Compensation and Indemnity.................................................. 56
Section 7.08. Replacement of Trustee...................................................... 56
Section 7.09. Successor Trustee by Merger, etc............................................ 57
Section 7.10. Eligibility; Disqualification............................................... 57
Section 7.11. Preferential Collection of Claims Against Company........................... 57
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE........................................... 57
Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.................... 57
Section 8.02. Legal Defeasance and Discharge.............................................. 58
Section 8.03. Covenant Defeasance......................................................... 58
Section 8.04. Conditions to Legal or Covenant Defeasance.................................. 58
Section 8.05. Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions................................................... 59
Section 8.06. Repayment to Company........................................................ 60
Section 8.07. Reinstatement............................................................... 60
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER................................................... 60
Section 9.01. Without Consent of Holders of Notes......................................... 60
Section 9.02. With Consent of Holders of Notes............................................ 61
Section 9.03. Compliance with Trust Indenture Act......................................... 62
Section 9.04. Revocation and Effect of Consents........................................... 62
Section 9.05. Notation on or Exchange of Notes............................................ 62
Section 9.06. Trustee to Sign Amendments, etc............................................. 62
ARTICLE 10. SUBSIDIARY GUARANTEES............................................................. 63
Section 10.01. Guarantee................................................................... 63
Section 10.02. Limitation on Subsidiary Guarantor Liability................................ 64
Section 10.03. Execution and Delivery of Subsidiary Guarantee.............................. 64
Section 10.04. Subsidiary Guarantors May Consolidate, etc., on Certain Terms............... 65
Section 10.05. Releases Following Sale of Assets........................................... 65
ARTICLE 11. SATISFACTION AND DISCHARGE........................................................ 66
Section 11.01. Satisfaction and Discharge.................................................. 66
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Section 11.02. Deposited Money and Government Securities to be Held in Trust; Other
Miscellaneous Provisions.................................................... 66
Section 11.03. Repayment to Company........................................................ 67
ARTICLE 12. SUBORDINATION..................................................................... 67
Section 12.01. Agreement to Subordinate.................................................... 67
Section 12.02. Liquidation, Dissolution, Bankruptcy........................................ 67
Section 12.03. Default on Senior Debt...................................................... 68
Section 12.04. Acceleration of Payment of Securities....................................... 68
Section 12.05. When Distribution Must Be Paid Over......................................... 68
Section 12.06. Subrogation................................................................. 69
Section 12.07. Relative Rights............................................................. 69
Section 12.08. Subordination May Not Be Impaired by the Company or the Subsidiary
Guarantors ................................................................. 69
Section 12.09. Rights of Trustee and Paying Agent.......................................... 69
Section 12.10. Distribution or Notice to Representative.................................... 69
Section 12.11. Article 12 Not to Prevent Events of Default or Limit Right to Accelerate.... 70
Section 12.12. Trust Moneys Not Subordinated............................................... 70
Section 12.13. Trustee Entitled to Rely.................................................... 70
Section 12.14. Trustee to Effectuate Subordination......................................... 70
Section 12.15. Trustee Not Fiduciary for Holders of Senior Debt............................ 70
Section 12.16. Reliance by Holders of Senior Debt on Subordination Provisions.............. 70
Section 12.17. Ranking with Respect to Other Senior Subordinated Indebtedness.............. 71
ARTICLE 13. MISCELLANEOUS..................................................................... 71
Section 13.01. Trust Indenture Act Controls................................................ 71
Section 13.02. Notices..................................................................... 71
Section 13.03. Communication by Holders of Notes with Other Holders of Notes............... 72
Section 13.04. Certificate and Opinion as to Conditions Precedent.......................... 72
Section 13.05. Statements Required in Certificate or Opinion............................... 72
Section 13.06. Rules by Trustee and Agents................................................. 72
Section 13.07. No Personal Liability of Directors, Officers, Employees and Stockholders.... 73
Section 13.08. Governing Law............................................................... 73
Section 13.09. No Adverse Interpretation of Other Agreements............................... 73
Section 13.10. Successors.................................................................. 73
Section 13.11. Severability................................................................ 73
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PAGE
Section 13.12. Counterpart Originals....................................................... 73
Section 13.13. Table of Contents, Headings, etc............................................ 73
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EXHIBITS
Exhibit A FORM OF NOTE................................................................ A-1
Exhibit B FORM OF CERTIFICATE OF TRANSFER............................................. B-1
Exhibit C FORM OF CERTIFICATE OF EXCHANGE............................................. C-1
Exhibit D FORM OF CERTIFICATE FROM ACQUIRING
INSTITUTIONAL ACCREDITED INVESTOR........................................... D-1
Exhibit E FORM OF NOTATION OF GUARANTEE............................................... E-1
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