1
Exhibit 4.4.1
FOOD 4 LESS SUPERMARKETS, INC.
TO BE MERGED WITH AND INTO RALPHS GROCERY COMPANY
AND
SUBSIDIARY GUARANTORS
AND
NORWEST BANK MINNESOTA, National Association,
TRUSTEE
_________________
INDENTURE
Dated as of June 1, 1995
________________
$520,326,000
10.45% Senior Notes
due 2004
2
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
310(a)(1)........................................... 7.10
(a)(2).......................................... 7.10
(a)(3).......................................... N.A.
(a)(4).......................................... N.A
(a)(5).......................................... 7.10; 7.11
(b)............................................. 7.08; 7.10; 11.02
(c)............................................. N.A.
311(a).............................................. 7.11
(b)............................................. 7.11
(c)............................................. N.A.
312(a).............................................. 2.05
(b)............................................. 11.03
(c)............................................. 11.03
313(a).............................................. 7.06
(b)(1).......................................... N.A
(b)(2).......................................... 7.06
(c)............................................. 7.06; 11.02
(d)............................................. 7.06
314(a).............................................. 4.07; 4.09; 11.02
(b)............................................. N.A.
(c)(1).......................................... 7.02; 11.04
(c)(2).......................................... 7.02; 11.04
(c)(3).......................................... N.A.
(d)............................................. N.A.
(e)............................................. 11.05
(f)............................................. N.A
315(a).............................................. 7.01(b)
(b)............................................. 7.05; 11.02
(c)............................................. 7.01(a)
(d)............................................. 7.01(c)
(e)............................................. 6.11
316(a)(last sentence)............................... 2.09
(a)(1)(A)....................................... 6.05
(a)(1)(B)....................................... 6.04
(a)(2).......................................... N.A.
(b)............................................. 6.07
317(a)(1)........................................... 6.08
(a)(2).......................................... 6.09
(b)............................................. 2.04
318(a).............................................. 11.01
(c)............................................. 11.01
3
________________________
N.A. means Not Applicable
NOTE: This Cross-Reference Table shall not, for any purpose, be
deemed to be a part of the Indenture.
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TABLE OF CONTENTS
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Page
Section 1.01 Definitions..................................... 1
Section 1.02 Incorporation by Reference of TIA............... 31
Section 1.03 Rules of Construction........................... 31
ARTICLE TWO
THE SECURITIES
Section 2.01 Form and Dating................................. 32
Section 2.02 Execution and Authentication.................... 32
Section 2.03 Registrar and Paying Agent...................... 34
Section 2.04 Paying Agent To Hold Assets in
Trust........................................ 34
Section 2.05 Securityholder Lists............................ 35
Section 2.06 Transfer and Exchange........................... 35
Section 2.07 Replacement Securities.......................... 36
Section 2.08 Outstanding Securities.......................... 36
Section 2.09 Treasury Securities............................. 37
Section 2.10 Temporary Securities............................ 37
Section 2.11 Cancellation.................................... 37
Section 2.12 Defaulted Interest.............................. 38
Section 2.13 CUSIP Number.................................... 38
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ARTICLE THREE
REDEMPTION
Section 3.01 Notices to Trustee.............................. 38
Section 3.02 Selection of Securities To Be
Redeemed..................................... 39
Section 3.03 Notice of Redemption............................ 39
Section 3.04 Effect of Notice of Redemption.................. 40
Section 3.05 Deposit of Redemption Price..................... 40
Section 3.06 Securities Redeemed in Part..................... 41
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ARTICLE FOUR
COVENANTS
Section 4.01 Payment of Securities........................... 41
Section 4.02 Maintenance of Office or Agency................. 41
Section 4.03 Limitation on Restricted Payments............... 42
Section 4.04 Corporate Existence............................. 44
Section 4.05 Payment of Taxes and Other Claims............... 44
Section 4.06 Maintenance of Properties and
Insurance.................................... 44
Section 4.07 Compliance Certificate; Notice of
Default...................................... 45
Section 4.08 Compliance with Laws............................ 46
Section 4.09 SEC Reports..................................... 47
Section 4.10 Waiver of Stay, Extension or Usury
Laws......................................... 47
Section 4.11 Limitation on Transactions with
Affiliates................................... 47
Section 4.12 Limitation on Incurrences of
Additional Indebtedness...................... 50
Section 4.13 Limitation on Dividends and Other
Payment Restrictions Affecting
Subsidiaries................................. 50
Section 4.14 Limitation on Liens............................. 51
Section 4.15 Limitation on Change of Control................. 52
Section 4.16 Limitation on Asset Sales....................... 55
Section 4.17 Guarantees of Certain Indebtedness.............. 58
Section 4.18 Limitation on Preferred Stock of
Subsidiaries................................. 58
ARTICLE FIVE
SUCCESSOR CORPORATION
7
Section 5.01 Limitation on Mergers and Certain
Other Transactions........................... 58
Section 5.02 Successor Corporation Substituted............... 60
ARTICLE SIX
DEFAULT AND REMEDIES
Section 6.01 Events of Default............................... 61
Section 6.02 Acceleration.................................... 63
Section 6.03 Other Remedies.................................. 64
Section 6.04 Waiver of Past Defaults......................... 64
Section 6.05 Control by Majority............................. 65
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Section 6.06 Limitation on Suits............................. 65
Section 6.07 Rights of Holders To Receive
Payment...................................... 66
Section 6.08 Collection Suit by Trustee...................... 66
Section 6.09 Trustee May File Proofs of Claim................ 66
Section 6.10 Priorities...................................... 67
Section 6.11 Right and Remedies Cumulative................... 67
Section 6.12 Delay or Omission Not Waiver.................... 68
Section 6.13 Undertaking for Costs........................... 68
ARTICLE SEVEN
TRUSTEE
Section 7.01 Duties of Trustee............................... 68
Section 7.02 Rights of Trustee............................... 70
Section 7.03 Individual Rights of Trustee.................... 71
Section 7.04 Trustee's Disclaimer............................ 71
Section 7.05 Notice of Default............................... 71
Section 7.06 Reports by Trustee to Holders................... 71
Section 7.07 Compensation and Indemnity...................... 72
Section 7.08 Replacement of Trustee.......................... 73
Section 7.09 Successor Trustee by Merger, Etc................ 74
Section 7.10 Eligibility; Disqualification................... 74
Section 7.11 Preferential Collection of Claims
Against Company.............................. 74
ARTICLE EIGHT
SATISFACTION AND DISCHARGE OF INDENTURE
Section 8.01 Termination of the Company's
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Obligations.................................. 75
Section 8.02 Legal Defeasance and Covenant
Defeasance................................... 76
Section 8.03 Application of Trust Money...................... 81
Section 8.04 Repayment to Company or Subsidiary
Guarantors................................... 81
Section 8.05 Reinstatement................................... 82
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.01 Without Consent of Holders...................... 82
Section 9.02 With Consent of Holders......................... 83
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Section 9.03 Compliance with TIA............................. 84
Section 9.04 Revocation and Effect of Consents............... 85
Section 9.05 Notation on or Exchange of
Securities................................... 85
Section 9.06 Trustee To Sign Amendments, Etc................. 86
ARTICLE TEN
GUARANTEE
Section 10.01 Unconditional Guarantee......................... 86
Section 10.02 Severability.................................... 87
Section 10.03 Release of a Subsidiary Guarantor............... 88
Section 10.04 Limitation of Subsidiary
Guarantor's Liability........................ 88
Section 10.05 Subsidiary Guarantors May
Consolidate, etc., on Certain
Terms........................................ 89
Section 10.06 Contribution.................................... 90
Section 10.07 Waiver of Subrogation........................... 91
Section 10.08 Execution of Guarantee.......................... 91
Section 10.09 Waiver of Stay, Extension or Usury
Laws......................................... 92
ARTICLE ELEVEN
MISCELLANEOUS
Section 11.01 TIA Controls.................................... 92
Section 11.02 Notices......................................... 93
Section 11.03 Communications by Holders with
Other Holders................................ 94
Section 11.04 Certificate and Opinion as to
Conditions Precedent......................... 94
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Section 11.05 Statements Required in Certificate
or Opinion................................... 94
Section 11.06 Rules by Trustee, Paying Agent,
Registrar.................................... 95
Section 11.07 Legal Holidays.................................. 95
Section 11.08 Governing Law................................... 95
Section 11.09 No Adverse Interpretation of Other
Agreements................................... 96
Section 11.10 No Recourse Against Others...................... 96
Section 11.11 Successors...................................... 96
Section 11.12 Duplicate Originals............................. 96
Section 11.13 Severability.................................... 96
Section 11.14 No Violation.................................... 96
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Signatures........................................................ S-1
Exhibit A - Form of Note
Note: This Table of Contents shall not, for any purpose, be
deemed to be part of the Indenture.
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INDENTURE dated as of June 1, 1995, among FOOD 4 LESS
SUPERMARKETS, INC., a Delaware corporation (the "Company"), the
SUBSIDIARY GUARANTORS, and NORWEST BANK MINNESOTA, National
Association, as Trustee.
Each party hereto agrees as follows for the benefit
of each other party and for the equal and ratable benefit of
the Holders of the Company's 10.45% Senior Notes due 2004:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means (i) with respect to any
person that becomes a Subsidiary of the Company (or is merged
into the Company or any of its Subsidiaries) after the Issue
Date, Indebtedness of such person or any of its Subsidiaries
existing at the time such person becomes a Subsidiary of the
Company (or is merged into the Company or any of its
Subsidiaries) and which was not incurred in connection with, or
in contemplation of, such person becoming a Subsidiary of the
Company (or being merged into the Company or any of its
Subsidiaries) and (ii) with respect to the Company or any of
its Subsidiaries, any Indebtedness assumed by the Company or
any of its Subsidiaries in connection with the acquisition of
any assets from another person (other than the Company or any
of its Subsidiaries), and which was not incurred by such other
person in connection with, or in contemplation of, such
acquisition.
"Adjusted Net Assets" shall have the meaning provided
in Section 10.06.
"Affiliate" means, with respect to any person, any
other person directly or indirectly controlling or controlled
by or under direct or indirect common control with such
specified person. For the purposes of this definition,
"control" when used with respect to any person means the power
to direct the management and policies of such person, directly
or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms
"affiliated," "controlling" and "controlled" have meanings
correlative to the foregoing. Notwithstanding the foregoing,
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the term "Affiliate," with respect to the Company and its
Subsidiaries, shall not include BT Securities Corporation or
any of its Affiliates.
"Affiliate Transaction" shall have the meaning
provided in Section 4.11.
"Agent" means any Registrar, Paying Agent or
co-Registrar.
"Apollo Advisors, L.P." means Apollo Advisors, L.P.,
a Delaware limited partnership.
"Asset Sale" means, with respect to any person, any
sale, transfer or other disposition or series of sales,
transfers or other dispositions (including, without limitation,
by merger or consolidation or by exchange of assets and whether
by operation of law or otherwise) made by such person or any of
its subsidiaries to any person other than such person or one of
its wholly owned subsidiaries (or, in the case of a sale,
transfer or other disposition by a Subsidiary, to any person
other than the Company or a directly or indirectly wholly owned
Subsidiary) of any assets of such person or any of its
subsidiaries including, without limitation, assets consisting
of any Capital Stock or other securities held by such person or
any of its subsidiaries, and any Capital Stock issued by any
subsidiary of such person, in each case, outside of the
ordinary course of business, excluding, however, any sale,
transfer or other disposition, or series of related sales,
transfers or other dispositions (i) involving only Excluded
Assets, (ii) resulting in Net Proceeds to the Company and the
Subsidiaries of $500,000 or less, (iii) pursuant to any
foreclosure of assets or other remedy provided by applicable
law to a creditor of the Company or any Subsidiary with a Lien
on such assets, which Lien is permitted under this Indenture,
provided that such foreclosure or other remedy is conducted in
a commercially reasonable manner or in accordance with any
Bankruptcy Law, (iv) involving only Cash Equivalents or
inventory in the ordinary course of business or obsolete
equipment in the ordinary course of business consistent with
past practices of the Company, (v) involving only the lease or
sub-lease of any real or personal property in the ordinary
course of business or (vi) the proceeds of such Asset Sale
which are not applied as contemplated in Section 4.16 and which
together with all other such Asset Sale Proceeds do not exceed
$20 million.
"Average Life" means, as of the date of
determination, with respect to any debt security, the quotient
obtained by dividing (i) the sum of the products of the number
15
of years from the date of determination to the dates of each
successive scheduled principal payments of such debt security
multiplied by the amount of each such principal payment by
(ii) the sum of all such principal payments.
"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, with respect to any
person, the Board of Directors of such person or of a
subsidiary of such person or any duly authorized committee of
the Board of Directors.
"Board Resolution" means, with respect to any person,
a duly adopted resolution of the Board of Directors of such
person.
"Business Day" means a day that is not a Legal
Holiday.
"Capital Stock" means, with respect to any person,
any and all shares, interests, participation or other
equivalents (however designated) of corporate stock, including
each class of common stock and preferred stock of such person.
"Capitalized Lease Obligation" means obligations
under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP, and the amount of
Indebtedness represented by such obligations shall be the
capitalized amount of such obligations determined in accordance
with GAAP.
"Cash Equivalents" means (i) obligations issued or
unconditionally guaranteed by the United States of America or
any agency thereof, or obligations issued by any agency or
instrumentality thereof and backed by the full faith and credit
of the United States of America, (ii) commercial paper rated
the highest grade by Moody's Investors Service, Inc. and
Standard & Poor's Ratings Group and maturing not more than one
year from the date of creation thereof, (iii) time deposits
with, and certificates of deposit and banker's acceptances
issued by, any bank having capital surplus and undivided
profits aggregating at least $500 million and maturing not more
than one year from the date of creation thereof,
(iv) repurchase agreements that are secured by a perfected
security interest in an obligation described in clause (i) and
are with any bank described in clause (iii), (v) shares of any
money market mutual fund that (a) has at least 95% of its
assets invested continuously in the types of investments
16
referred to in clauses (i) and (ii) above, (b) has net assets
of not less than $500 million, and (c) has the highest rating
obtainable from either Standard & Poor's Ratings Group or
Moody's Investors Service, Inc. and (vi) readily marketable
direct obligations issued by any state of the United States of
America or any political subdivision thereof having one of the
two highest rating categories obtainable from either Moody's
Investors Service, Inc. or Standard & Poor's Ratings Group.
"Change of Control" means the acquisition after the
Issue Date, in one or more transactions, of beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange
Act) by (i) any person or entity (other than any Permitted
Holder) or (ii) any group of persons or entities (excluding any
Permitted Holders) who constitute a group (within the meaning
of Section 13(d)(3) of the Exchange Act), in either case, of
any securities of New Holdings or the Company such that, as a
result of such acquisition, such person, entity or group
beneficially owns (within the meaning of Rule 13d-3 under the
Exchange Act), directly or indirectly, 40% or more of the then
outstanding voting securities entitled to vote on a regular
basis for a majority of the Board of Directors of the Company
(but only to the extent that such beneficial ownership is not
shared with any Permitted Holder who has the power to direct
the vote thereof); provided, however, that no such Change of
Control shall be deemed to have occurred if (A) the Permitted
Holders beneficially own, in the aggregate, at such time, a
greater percentage of such voting securities than such other
person, entity or group or (B) at the time of such acquisition,
the Permitted Holders (or any of them) possess the ability (by
contract or otherwise) to elect, or cause the election, of a
majority of the members of the Company's Board of Directors.
"Change of Control Date" shall have the meaning
provided in Section 4.15.
"Change of Control Offer" shall have the meaning
provided in Section 4.15.
"Change of Control Payment Date" shall have the
meaning provided in Section 4.15.
"Commission" means the Securities and Exchange
Commission.
"Common Stock" means, with respect to any person, any
and all shares, interests or other participations in, and other
equivalents (however designated and whether voting or
nonvoting) of, such person's common stock, whether outstanding
at the Issue Date or issued after the Issue Date, and includes,
17
without limitation, all series and classes of such common
stock.
"Company" means the party named as such in this
Indenture until a successor replaces it pursuant to this
Indenture and thereafter means such successor.
"Consolidated Net Income," means, with respect to any
person, for any period, the aggregate of the net income (or
loss) of such person and its subsidiaries for such period, on a
consolidated basis, determined in accordance with GAAP;
provided that (a) the net income of any other person in which
such person or any of its subsidiaries has an interest (which
interest does not cause the net income of such other person to
be consolidated with the net income of such person and its
subsidiaries in accordance with GAAP) shall be included only to
the extent of the amount of dividends or distributions actually
paid to such person or such subsidiary by such other person in
such period; (b) the net income of any subsidiary of such
person that is subject to any Payment Restriction shall be
excluded to the extent such Payment Restriction actually
prevented the payment of an amount that otherwise could have
been paid to, or received by, such person or a subsidiary of
such person not subject to any Payment Restriction; and (c)(i)
the net income (or loss) of any other person acquired in a
pooling of interests transaction for any period prior to the
date of such acquisition, (ii) all gains and losses realized on
any Asset Sale, (iii) all gains realized upon or in connection
with or as a consequence of the issuance of the Capital Stock
of such person or any of its subsidiaries and any gains on
pension reversions received by such person or any of its
subsidiaries, (iv) all gains and losses realized on the
purchase or other acquisition by such person or any of its
subsidiaries of any securities of such person or any of its
subsidiaries, (v) all gains and losses resulting from the
cumulative effect of any accounting change pursuant to the
application of Accounting Principles Board Opinion No. 20, as
amended, (vi) all other extraordinary gains and losses, (vii)
(A) all non-cash charges, (B) up to $10 million of severance
costs and (C) any other restructuring reserves or charges
(provided, however, that any cash payments actually made with
respect to the liabilities for which such restructuring
reserves or charges were created shall be deducted from
Consolidated Net Income in the period when made), in each case,
incurred by the Company or any of its Subsidiaries in
connection with the Merger, including, without limitation, the
divestiture of the Excluded Assets, (viii) losses incurred by
the Company and its Subsidiaries resulting from earthquakes and
(ix) with respect to the Company, all deferred financing costs
written off in connection with the early extinguishment of any
18
Indebtedness, shall each be excluded; provided further that
solely for the purpose of computing amounts described in
subclause (c) of the first paragraph of Section 4.03,
"Consolidated Net Income" of the Company for any period shall
be reduced by the aggregate amount of dividends paid by the
Company or a Subsidiary to New Holdings pursuant to clauses
(v), (vi) and (xiv) of the definition of "Permitted Payments"
during such period.
"Consolidated Net Worth" means, with respect to any
person, the total stockholders' equity (exclusive of any
Disqualified Capital Stock) of such person and its subsidiaries
determined on a consolidated basis in accordance with GAAP.
"Consulting Agreement" means that certain Consulting
Agreement dated as of the Issue Date, between Food 4 Less, New
Holdings and The Yucaipa Companies (as such Consulting
Agreement may be amended or replaced, so long as any amounts
paid under any amended or replacement agreement do not exceed
the amounts payable under such Consulting Agreement as in
effect on the Issue Date).
"Credit Agent" means, at any time, the then-acting
Administrative Agent as defined in and under the Credit
Agreement, which initially shall be Bankers Trust Company. The
Company shall promptly notify the Trustee of any change in the
Credit Agent.
"Credit Agreement" means the Credit Agreement, dated
as of the Issue Date, by and among Food 4 Less, as borrower,
certain of its subsidiaries, New Holdings, as guarantor, the
Lenders referred to therein and Bankers Trust Company, as
administrative agent, as the same may be amended, extended,
renewed, restated, supplemented or otherwise modified (in each
case, in whole or in part, and without limitation as to amount,
terms, conditions, covenants and other provisions) from time to
time, and any agreement governing Indebtedness incurred to
refund, replace or refinance any borrowings and commitments
then outstanding or permitted to be outstanding under such
Credit Agreement or any such prior agreement as the same may be
amended, extended, renewed, restated, supplemented or otherwise
modified (in each case, in whole or in part, and without
limitation as to amount, terms, conditions, covenants and other
provisions). The term "Credit Agreement" shall include all
related or ancillary documents, including, without limitation,
any guarantee agreements and security documents. The Company
shall promptly notify the Trustee of any such refunding or
refinancing of the Credit Agreement.
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"Custodian" means any receiver, trustee, assignee,
liquidator, sequestrator or similar official under any
Bankruptcy Law.
"Default" means any event which is, or after notice
or passage of time or both would be, an Event of Default.
"Discount Notes" means the 15.25% Senior Discount
Notes due 2004 of Holdings issued pursuant to the Discount Note
Indenture, as the same may be modified or amended from time to
time and future refinancings thereof to the extent such
refinancings are permitted under this Indenture.
"Discount Note Indenture" means the indenture dated
as of December 15, 1992 under which the 15.25% Senior Discount
Notes due 2004 of Holdings were issued, as the same may be
modified or amended from time to time and future refinancings
thereof to the extent such refinancings are permitted under
this Indenture.
"Disqualified Capital Stock" means, with respect to
any person, any Capital Stock of such person or its
subsidiaries that, by its terms, by the terms of any agreement
related thereto or by the terms of any security into which it
is convertible, puttable or exchangeable is, or upon the
happening of an event or the passage of time would be, required
to be redeemed or repurchased by such person or its
subsidiaries, including at the option of the holder thereof, in
whole or in part, or has, or upon the happening of an event or
passage of time would have, a redemption or similar payment
due, on or prior to the Maturity Date of the Securities or any
other Capital Stock of such person or its subsidiaries
designated as Disqualified Capital Stock by such person at the
time of issuance; provided, however, that if such Capital Stock
is either (i) redeemable or repurchasable solely at the option
of such person or (ii) issued to employees of the Company or
its Subsidiaries or to any plan for the benefit of such
employees, such Capital Stock shall not constitute Disqualified
Capital Stock unless so designated.
"EBDIT" means, with respect to any person, for any
period, the Consolidated Net Income of such person for such
period, plus, in each case to the extent deducted in computing
Consolidated Net Income of such person for such period (without
duplication) (i) provisions for income taxes or similar charges
recognized by such person and its consolidated subsidiaries
accrued during such period, (ii) depreciation and amortization
expense of such person and its consolidated subsidiaries
accrued during such period (but only to the extent not included
in Fixed Charges), (iii) Fixed Charges of such person and its
20
consolidated subsidiaries for such period, (iv) LIFO charges
(credits) of such person and its consolidated subsidiaries for
such period, (v) the amount of any restructuring reserve or
charge recorded during such period in accordance with GAAP,
including any such reserve or charge related to the Merger, and
(vi) any other non-cash charges reducing Consolidated Net
Income for such period (excluding any such charge which
requires an accrual of or a cash reserve for cash charges for
any future period), less, without duplication, (i) non-cash
items increasing Consolidated Net Income of such person for
such period (excluding any such items which represent the
reversal of any accrual of, or cash reserve for, anticipated
cash charges in any prior period) in each case determined in
accordance with GAAP and (ii) the amount of all cash payments
made by such person or its subsidiaries during such period to
the extent that such cash payment has been provided for in a
restructuring reserve or charge referred to in clause (v) above
(and was not otherwise deducted in the computation of
Consolidated Net Income of such person for such period).
"Event of Default" shall have the meaning provided in
Section 6.01.
"Exchange Act" means the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated by
the Commission thereunder.
"Excluded Assets" means assets of the Company or any
Subsidiary required to be disposed of by applicable regulatory
authorities in connection with the Merger.
"Existing Indebtedness" means the following
indebtedness of the Company to the extent outstanding on the
Issue Date after giving effect to the Merger; (a) the 10.45%
Senior Notes due 2004 issued pursuant to an indenture dated as
of the date hereof; (b) the 10.45% Senior Notes due 2000 issued
pursuant to an indenture dated as of April 15, 1992; (c) the
11% Senior Subordinated Notes due 2005 issued pursuant to an
indenture dated as of the Issue Date; (d) the 9% Senior
Subordinated Notes due 2003 issued pursuant to an indenture
dated as of March 30, 1993; (e) the 10<% Senior Subordinated
Notes due 2002 issued pursuant to an indenture dated as of
July 29, 1992; (f) the 13.75% Senior Subordinated Notes due
2005 issued pursuant to an indenture dated as of the Issue
Date, and (g) the 13.75% Senior Subordinated Notes due 2001
issued pursuant to an indenture dated as of June 15, 1991.
"Fixed Charges" means, with respect to any person,
for any period, the aggregate amount of (i) interest, whether
expensed or capitalized, paid, accrued or scheduled to be paid
21
or accrued during such period (except to the extent accrued in
a prior period) in respect of all Indebtedness of such person
and its consolidated subsidiaries (including (a) original issue
discount on any Indebtedness (including, (without duplication)
in the case of the Company, any original issue discount on the
Securities but excluding amortization of debt issuance costs)
and (b) the interest portion of all deferred payment
obligations, calculated in accordance with the effective
interest method, in each case to the extent attributable to
such period but excluding the amortization of debt issuance
costs), (ii) dividend requirements on Preferred Stock of such
person and its consolidated subsidiaries (whether in cash or
otherwise (except dividends payable in shares of Qualified
Capital Stock)) declared or paid or required to be declared or
paid during such period (except to the extent accrued in a
prior period) and excluding items eliminated in consolidation
and (iii) dividends declared or paid or scheduled or required
to be declared or paid to New Holdings which are permitted to
be paid pursuant to clauses (v) and (vi) of the definitiion of
"Permitted Payments." For purposes of this definition,
(a) interest on a Capitalized Lease Obligation shall be deemed
to accrue at an interest rate reasonably determined by the
Board of Directors of such person (as evidenced by a Board
Resolution) to be the rate of interest implicit in such
Capitalized Lease Obligation in accordance with GAAP,
(b) interest on Indebtedness that is determined on a
fluctuating basis shall be deemed to have accrued at a fixed
rate per annum equal to the rate of interest of such
Indebtedness in effect on the date Fixed Charges are being
calculated, (c) interest on Indebtedness that may optionally be
determined at an interest rate based upon a factor of a prime
or similar rate, a eurocurrency interbank offered rate, or
other rate, shall be deemed to have been based upon the rate
actually chosen, or, if none, then based upon such optional
rate chosen as the Company may designate, and (d) Fixed Charges
shall be increased or reduced by the net cost (including
amortization of discount) or benefit associated with Interest
Swap Obligations attributable to such period. For purposes of
clause (ii) above, dividend requirements shall be increased to
an amount representing the pre-tax earnings that would be
required to cover such dividend requirements; accordingly, the
increased amount shall be equal to a fraction, the numerator of
which is the amount of such dividend requirements and the
denominator of which is one (1) minus the applicable actual
combined federal, state, local and foreign income tax rate of
such person and its subsidiaries (expressed as a decimal), on a
consolidated basis, for the fiscal year immediately preceding
the date of the transaction giving rise to the need to
calculate Fixed Charges.
22
"FFL" means Food 4 Less, Inc., a Delaware
corporation, and its successors, including, without limitation,
Holdings following the FFL Merger and New Holdings following
the Reincorporation Merger.
"F4L Exchange Offers" means, the offer by the Company
as described in the Amended and Restated Prospectus and
Solicitation Statement dated May 12, 1995 (as supplemented) to
holders of Old F4L Senior Subordinated Notes to exchange such
notes for New F4L Senior Subordinated Notes.
"FFL Merger" means the merger, prior to the Merger
and the Reincorporation Merger, of FFL and Holdings.
"Food 4 Less" means Food 4 Less Supermarkets, Inc., a
Delaware corporation, and its successors, including, without
limitation, Ralphs Supermarkets, Inc. (to be renamed Ralphs
Grocery Company following the Merger).
"Foreign Exchange Agreement" means any foreign
exchange contract, currency swap agreement or other similar
agreement or arrangement designed to protect against
fluctuations in currency values.
"Forward Period" shall have the meaning provided in
the definition of "Operating Coverage Ratio" contained in this
Section 1.01.
"GAAP" means generally accepted accounting principles
as in effect in the United States of America as of the date of
this Indenture.
"Guarantee" means the guarantee of each Subsidiary
Guarantor set forth in Article Ten and any additional guarantee
of the Securities executed by any Subsidiary of the Company.
"Holder" or "Securityholder" means the person in
whose name a Security is registered on the Registrar's books.
"Holdings" means Food 4 Less Holdings, Inc., a
California corporation, and its successors, including, without
limitation, New Holdings following the Reincorporation Merger.
"Indebtedness" means with respect to any person,
without duplication, (i) all liabilities, contingent or
otherwise, of such person (a) for borrowed money (whether or
not the recourse of the lender is to the whole of the assets of
such person or only to a portion thereof), (b) evidenced by
bonds, notes, debentures, drafts accepted or similar
instruments or letters of credit or representing the balance
23
deferred and unpaid of the purchase price of any property
(other than any such balance that represents an account payable
or any other monetary obligation to a trade creditor (whether
or not an Affiliate) created, incurred, assumed or guaranteed
by such person in the ordinary course of business of such
person in connection with obtaining goods, materials or
services and due within twelve months (or such longer period
for payment as is customarily exended by such trade creditor)
of the incurrence thereof, which account is not overdue by more
than 90 days, according to the original terms of sale, unless
such account payable is being contested in good faith), or (c)
for the payment of money relating to a Capitalized Lease
Obligation; (ii) the maximum fixed repurchase price of all
Disqualified Capital Stock of such person; (iii) reimbursement
obligations of such person with respect to letters of credit;
(iv) obligations of such person with respect to Interest Swap
Obligations and Foreign Exchange Agreements; (v) all
liabilities of others of the kind described in the preceding
clause (i), (ii), (iii) or (iv) that such person has guaranteed
or that is otherwise its legal liability; and (vi) all
obligations of others secured by a Lien to which any of the
properties or assets (including, without limitation, leasehold
interests and any other tangible or intangible property rights)
of such person are subject, whether or not the obligations
secured thereby shall have been assumed by such person or shall
otherwise be such person's legal liability (provided that if
the obligations so secured have not been assumed by such person
or are not otherwise such person's legal liability, such
obligations shall be deemed to be in an amount equal to the
fair market value of such properties or assets, as determined
in good faith by the Board of Directors of such person, which
determination shall be evidenced by a Board Resolution). For
purposes of the preceding sentence, the "maximum fixed
repurchase price" of any Disqualified Capital Stock that does
not have a fixed repurchase price shall be calculated in
accordance with the terms of such Disqualified Capital Stock as
if such Disqualified Capital Stock were purchased on any date
on which Indebtedness shall be required to be determined
pursuant to this Indenture, and if such price is based upon, or
measured by, the fair market value of such Disqualified Capital
Stock (or any equity security for which it may be exchanged or
converted), such fair market value shall be determined in good
faith by the Board of Directors of such person, which
determination shall be evidenced by a Board Resolution. For
purposes of this Indenture, Indebtedness incurred by any person
that is a general partnership (other than non-recourse
Indebtedness) shall be deemed to have been incurred by the
general partners of such partnership pro rata in accordance
with their respective interests in the liabilities of such
partnership unless any such general partner shall, in the
24
reasonable determination of the Board of Directors of the
Company, be unable to satisfy its pro rata share of the
liabilities of the partnership, in which case the pro rata
share of any Indebtedness attributable to such partner shall be
deemed to be incurred at such time by the remaining general
partners on a pro rata basis in accordance with their
interests.
"Indenture" means this Indenture, as amended or
supplemented from time to time in accordance with the terms
hereof.
"Independent Financial Advisor" means a reputable
accounting, appraisal or nationally recognized investment
banking or consulting firm that is, in the reasonable judgment
of the Board of Directors of the Company, qualified to perform
the tasks for which such firm has been engaged and
disinterested and independent with respect to the Company and
its Affiliates.
"Interest Payment Date" means the stated maturity of
an installment of interest on the Securities.
"Interest Swap Obligation" means any obligation of
any person pursuant to any arrangement with any other person
whereby, directly or indirectly, such person is entitled to
receive from time to time periodic payments calculated by
applying either a fixed or floating rate of interest on a
stated notional amount in exchange for periodic payments made
by such person calculated by applying a fixed or floating rate
of interest on the same notional amount; provided that the term
"Interest Swap Obligation" shall also include interest rate
exchange, collar, cap, swap option or similar agreements
providing interest rate protection.
"Investment" by any person in any other person means
any investment by such person in such other person, whether by
share purchase, capital contribution, loan, advance (other than
reasonable loans and advances to employees for moving and
travel expenses, as salary advances, or to permit the purchase
of Qualified Capital Stock of New Holdings or any of its
Subsidiaries and other similar customary expenses incurred, in
each case in the ordinary course of business consistent with
past practice) or similar credit extension constituting
Indebtedness of such other person, and any guarantee of
Indebtedness of any other person.
"Issue Date" means the date of original issuance of
the Securities under this Indenture.
25
"Legal Holiday" shall have the meaning provided in
Section 11.07.
"Letter of Credit Obligations" means Indebtedness of
the Company or any of its Subsidiaries with respect to letters
of credit issued pursuant to the Credit Agreement, and for
purposes of the definition of the term "Permitted
Indebtedness," the aggregate principal amount of Indebtedness
outstanding at any time with respect thereto shall be deemed to
consist of (a) the aggregate maximum amount then available to
be drawn under all such letters of credit (the determination of
such maximum amount to assume compliance with all conditions
for drawing), and (b) the aggregate amount that has then been
paid by, and not reimbursed to, the issuers under such letters
of credit.
"Lien" means any mortgage, pledge, lien, encumbrance,
charge or adverse claim affecting title or resulting in an
encumbrance against real or personal property, or a security
interest of any kind (including any conditional sale or other
title retention agreement, any lease in the nature thereof, any
option or other agreement to sell which is intended to
constitute or create a security interest, mortgage, pledge or
lien, and any filing of or agreement to give any financing
statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction); provided that in no event shall
an operating lease be deemed to constitute a Lien under this
Indenture.
"Maturity Date" means June 15, 2004.
"Merger" means (i) the merger of Food 4 Less into RSI
(with RSI surviving such merger) pursuant to the Merger
Agreement and (ii) immediately following the merger described
in clause (i) of this definition, the merger of Ralphs Grocery
Company into RSI (with RSI surviving such merger and changing
its name to "Ralphs Grocery Company" in connection with such
merger).
"Merger Agreement" means the Agreement and Plan of
Merger, dated September 14, 1994, by and among Holdings, FFL,
Food 4 Less, RSI and the stockholders of RSI, as such agreement
is in effect on the Issue Date.
"Net Cash Proceeds" means the Net Proceeds of any
Asset Sale received in the form of cash or Cash Equivalents.
"Net Proceeds" means (a) in the case of any Asset
Sale or any issuance and sale by any person of Qualified
Capital Stock, the aggregate net proceeds received by such
26
person after payment of expenses, taxes, commissions and the
like incurred in connection therewith (and, in the case of any
Asset Sale, net of the amount of cash applied to repay
Indebtedness secured by the asset involved in such Asset Sale),
whether such proceeds are in cash or in property (valued at the
fair market value thereof at the time of receipt, as determined
with respect to any Asset Sale resulting in Net Proceeds in
excess of $5 million in good faith by the Board of Directors of
such person, which determination shall be evidenced by a Board
Resolution) and (b) in the case of any conversion or exchange
of any outstanding Indebtedness or Disqualified Capital Stock
of such person for or into shares of Qualified Capital Stock of
the Company, the sum of (i) the fair market value of the
proceeds received by the Company in connection with the
issuance of such Indebtedness or Disqualified Capital Stock on
the date of such issuance and (ii) any additional amount paid
by the holder to the Company upon such conversion or exchange.
"New Discount Debenture Indenture" means the
indenture dated as of the Issue Date under which the 13 5/8%
Senior Discount Debentures due 2005 of New Holdings were
issued, as the same may be modified and amended from time to
time and refinancings thereof to the extent such refinancings
are permitted under this Indenture.
"New Discount Debentures" means the 13 5/8% Senior
Discount Debentures due 2005 of New Holdings issued pursuant to
the New Discount Debenture Indenture, as the same may be
modified and amended from time to time and future refinancings
thereof to the extent such refinancings are permitted under
this Indenture.
"New F4L Senior Subordinated Notes" means the 13.75%
senior subordinated notes due 2005 issued pursuant to the
Senior Subordinated Note Indenture dated as of June 1, 1995
that are issued in exchange for Old F4L Senior Subordinated
Notes.
"New Holdings" means Food 4 Less Holdings, Inc., a
Delaware corporation, and its successors.
"New RGC Notes" means the up to $450,000,000
aggregate principal amount of 11% senior subordinated notes due
2005 issued pursuant to the Senior Subordinated Note Indenture
dated as of June 1, 1995 which are issued in exchange for Old
RGC Notes.
"Officer" means, with respect to any person, the
Chairman of the Board, the President, any Vice President, the
27
Chief Financial Officer, the Controller, or the Secretary of
such person.
"Officers' Certificate" means, with respect to any
person, a certificate signed by two Officers or by an Officer
and either an Assistant Treasurer or an Assistant Secretary of
such person and otherwise complying with the requirements of
Sections 11.04 and 11.05.
"Old F4L Senior Subordinated Notes" means the 13.75%
senior subordinated notes due 2001 issued pursuant to an
indenture dated as of June 15, 1991.
"Old RGC Indentures" means the indentures between
Ralphs Grocery Company, as issuer, and United States Trust
Company of New York, as trustee, pursuant to which the Old RGC
Notes were issued.
"Old RGC Notes" means the 9% Senior Subordinated
Notes due 2003 of Ralphs Grocery Company and the 10 <% Senior
Subordinated Notes due 2002 of Ralphs Grocery Company.
"Operating Coverage Ratio" means, with respect to any
person, the ratio of (1) EBDIT of such person for the period
(the "Pro Forma Period") consisting of the most recent four
full fiscal quarters for which financial information in respect
thereof is available immediately prior to the date of the
transaction giving rise to the need to calculate the Operating
Coverage Ratio (the "Transaction Date") to (2) the aggregate
Fixed Charges of such person for the fiscal quarter in which
the Transaction Date occurs and the three fiscal quarters
immediately subsequent to such fiscal quarter (the "Forward
Period") reasonably anticipated by the Board of Directors of
such person to become due from time to time during such period.
For purposes of this definition, if the Transaction Date occurs
prior to the first anniversary of the Merger, "EBDIT" for the
Pro Forma Period shall be calculated, in the case of the
Company, after giving effect on a pro forma basis to the Merger
as if it had occurred on the first day of the Pro Forma Period.
In addition to, but without duplication of, the foregoing, for
purposes of this definition, "EBDIT" shall be calculated after
giving effect (without duplication), on a pro forma basis for
the Pro Forma Period (but no longer), to (a) any Investment,
during the period commencing on the first day of the Pro Forma
Period to and including the Transaction Date (the "Reference
Period"), in any other person that, as a result of such
Investment, becomes a subsidiary of such person, (b) the
acquisition, during the Reference Period (by merger,
consolidation or purchase of stock or assets) of any business
or assets, which acquisition is not prohibited by this
28
Indenture, and (c) any sales or other dispositions of assets
(other than sales of inventory in the ordinary course of
business) occurring during the Reference Period, in each case
as if such incurrence, Investment, repayment, acquisition or
asset sale had occurred on the first day of the Reference
Period. In addition, for purposes of this definition, "Fixed
Charges" shall be calculated after giving effect (without
duplication), on a pro forma basis for the Forward Period, to
any Indebtedness incurred or repaid on or after the first day
of the Forward Period and prior to the Transaction Date. If
such person or any of its subsidiaries directly or indirectly
guarantees any Indebtedness of a third person, the Operating
Coverage Ratio shall give effect to the incurrence of such
Indebtedness as if such person or subsidiary had directly
incurred such guaranteed Indebtedness.
"operating lease" means any lease the obligations
under which do not constitute Capitalized Lease Obligations.
"Opinion of Counsel" means a written opinion from
legal counsel who is reasonably acceptable to the Trustee
complying with the requirements of Sections 11.04 and 11.05.
Unless otherwise required by the Trustee, the legal counsel may
be an employee of or counsel to the Company or the Trustee.
"Pari Passu Indebtedness" means, with respect to the
Company or any Subsidiary Guarantor, Indebtedness of such
person which ranks pari passu in right of payment to the
Securities or the Guarantee of such Subsidiary Guarantor, as
the case may be (in each case, whether or not secured by any
Lien).
"Paying Agent" shall have the meaning provided in
Section 2.03, except that, for the purposes of Articles Three
and Eight and Sections 4.15 and 4.16, the Paying Agent shall
not be the Company or an Affiliate of the Company.
"Payment Restriction" means, with respect to a
subsidiary of any person, any encumbrance, restriction or
limitation, whether by operation of the terms of its charter or
by reason of any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation, on the ability
of (i) such subsidiary to (a) pay dividends or make other
distributions on its Capital Stock or make payments on any
obligation, liability or Indebtedness owed to such person or
any other subsidiary of such person, (b) make loans or advances
to such person or any other subsidiary of such person, or
(c) transfer any of its properties or assets to such person or
any other subsidiary of such person, or (ii) such person or any
other subsidiary of such person to receive or retain any such
29
(a) dividends, distributions or payments, (b) loans or
advances, or (c) transfer of properties or assets.
"Permitted Holder" means (i) Food 4 Less Equity
Partners, L.P., The Yucaipa Companies or any entity controlled
thereby or any of the partners thereof, (ii) Apollo Advisors,
L.P., Lion Advisors, L.P. or any entity controlled thereby or
any of the partners thereof, (iii) an employee benefit plan of
the Company, or any of its subsidiaries or any participant
therein, (iv) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or any of its
subsidiaries or (v) any Permitted Transferee of any of the
foregoing persons.
"Permitted Indebtedness" means (a) Indebtedness of
the Company and its Subsidiaries (and the Company and each
Subsidiary (to the extent it is not an obligor) may guarantee
such Indebtedness) pursuant to (i) the Term Loans in an
aggregate principal amount at any time outstanding not to
exceed $600 million less the aggregate amount of all principal
repayments thereunder pursuant to and in accordance with the
requirements of Section 4.16 subsequent to the Issue Date,
(ii) the revolving credit facility under the Credit Agreement
(including the Letter of Credit Obligations) in an aggregate
principal amount at any time outstanding not to exceed $325
million, less all permanent reductions thereunder pursuant to
and in accordance with the requirements of Section 4.16, and
(iii) any Indebtedness incurred under the Credit Agreement
pursuant to and in accordance with (A) clause (m) of this
definition and (B) Section 4.12 (other than Permitted
Indebtedness that is not incurred pursuant to clause (m) or
this clause (a) of this definition); (b) Indebtedness of the
Company or a Subsidiary Guarantor owed to and held by the
Company or a Subsidiary Guarantor; (c) Indebtedness incurred by
the Company or any Subsidiary in connection with the purchase
or improvement of property (real or personal) or equipment or
other capital expenditures in the ordinary course of business
(including for the purchase of assets or stock of any retail
grocery store or business) or consisting of Capitalized Lease
Obligations, provided that (i) at the time of the incurrence
thereof, such Indebtedness, together with any other
Indebtedness incurred during the most recently completed four
fiscal quarter period in reliance upon this clause (c) does not
exceed, in the aggregate, 3% of net sales of the Company and
its Subsidiaries during the most recently completed four fiscal
quarter period on a consolidated basis (calculated on a pro
forma basis if the date of incurrence is prior to the end of
the fourth fiscal quarter following the Merger) and (ii) such
Indebtedness, together with all then outstanding Indebtedness
incurred in reliance upon this clause (c) does not exceed, in
30
the aggregate, 3% of the aggregate net sales of the Company and
its Subsidiaries during the most recently completed twelve
fiscal quarter period on a consolidated basis (calculated on a
pro forma basis if the date of incurrence is prior to the end
of the twelfth fiscal quarter following the Merger);
(d) Indebtedness incurred by the Company or any Subsidiary in
connection with capital expenditures in an aggregate principal
amount not exceeding $150 million, provided that such capital
expenditures relate solely to the integration of the operations
of RSI, Food 4 Less and their respective subsidiaries as
described in the Prospectus of Food 4 Less relating to the
Securities dated May 31, 1995; (e) Indebtedness of the Company
or any Subsidiary incurred under Foreign Exchange Agreements
and Interest Swap Obligations entered into with respect to
Indebtedness otherwise permitted to be outstanding pursuant to
Section 4.12 or this definition of Permitted Indebtedness in a
notional amount not exceeding the aggregate principal amount of
such Indebtedness; (f) guarantees incurred in the ordinary
course of business by the Company or a Subsidiary of
Indebtedness of any other person in the aggregate not to exceed
$25 million at any time outstanding; (g) guarantees by the
Company or a Subsidiary Guarantor of Indebtedness incurred by a
wholly-owned Subsidiary Guarantor so long as the incurrence of
such Indebtedness incurred by such wholly-owned Subsidiary
Guarantor is permitted under the terms of this Indenture;
(h) Refinancing Indebtedness; (i) Indebtedness for letters of
credit relating to workers' compensation claims and
self-insurance or similar requirements in the ordinary course
of business; (j) Existing Indebtedness and other Indebtedness
outstanding on the Issue Date (after giving effect to the
Merger); (k) Indebtedness arising from guarantees of
Indebtedness of the Company or any Subsidiary or other
agreements of the Company or a Subsidiary providing for
indemnification, adjustment of purchase price or similar
obligations, in each case, incurred or assumed in connection
with the disposition of any business, assets or Subsidiary,
other than guarantees of Indebtedness incurred by any person
acquiring all or any portion of such business, assets or
Subsidiary for the purpose of financing such acquisition;
provided that the maximum aggregate liability in respect of all
such Indebtedness shall at no time exceed the gross proceeds
actually received by the Company and its Subsidiaries in
connection with such disposition; (l) obligations in respect of
performance bonds and completion guarantees provided by the
Company or any Subsidiary in the ordinary course of business;
and (m) additional Indebtedness of the Company and the
Subsidiary Guarantors in an amount not to exceed $175 million
at any time outstanding.
31
"Permitted Investment" by any person means (i) any
Related Business Investment, (ii) Investments in securities not
constituting cash or Cash Equivalents and received in
connection with an Asset Sale made pursuant to Section 4.16 or
any other disposition of assets not constituting an Asset Sale
by reason of the $500,000 threshold contained in the definition
thereof, (iii) cash and Cash Equivalents, (iv) Investments
existing on the Issue Date, (v) Investments specifically
permitted by and made in accordance with Section 4.11,
(vi) Investments by Subsidiary Guarantors in other Subsidiary
Guarantors or the Company and Investments by the Company in a
Subsidiary Guarantor in the form of Indebtedness owed to the
Company by such Subsidiary Guarantor and Investments by
Subsidiaries which are not Subsidiary Guarantors in other
Subsidiaries which are not Subsidiary Guarantors and
(vii) additional Investments in an aggregate amount not
exceeding $15 million.
"Permitted Liens" means (i) Liens for taxes,
assessments and governmental charges or claims not yet due or
which are being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and if
a reserve or other appropriate provision, if any, as shall be
required in conformity wity GAAP shall have been made thereof;
(ii) statutory Liens of landlords and carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen, or other like
Liens arising in the ordinary course of business, deposits made
to obtain the release of such Liens, and with respect to
amounts not yet delinquent for a period of more than 60 days or
being contested in good faith by appropriate process of law,
and for which a reserve or other appropriate provision, if any,
as shall be required by GAAP shall have been made; (iii) Liens
incurred or pledges or deposits made in the ordinary course of
business to secure obligations under workers' compensation,
unemployment insurance and other types of social security or
similar legislation; (iv) Liens incurred or deposits made to
secure the performance of tenders, bids, leases, statutory
obligations, surety and appeal bonds, government contracts,
performance and return of money bonds and other obligations of
a like nature incurred in the ordinary course of business
(exclusive of obligations for the payment of borrowed money);
(v) easements, rights-of-way, zoning or other restrictions,
minor defects or irregularities in title and other similar
charges or encumbrances not interfering in any material respect
with the business of the Company or any of its Subsidiaries
incurred in the ordinary course of business; (vi) Liens upon
specific items of inventory or other goods and proceeds of any
person securing such person's obligations in respect of
bankers' acceptances issued or created for the account of such
person to facilitate the purchase, shipment or storage of such
32
inventory or other goods in the ordinary course of business;
(vii) Liens securing reimbursement obligations with respect to
letters of credit which encumber documents and other property
relating to such letters of credit and the products and
proceeds thereof; (viii) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
nondelinquent customs duties in connection with the importation
of goods; (ix) judgment and attachment Liens not giving rise to
a Default or Event of Default; (x) leases or subleases granted
to others not interfering in any material respect with the
business of the Company or any Subsidiary; (xi) Liens
encumbering customary initial deposits and margin deposits, and
other Liens incurred in the ordinary course of business that
are within the general parameters customary in the industry, in
each case securing Indebtedness under Interest Swap Obligations
and Foreign Exchange Agreements and forward contracts, option
futures contracts, futures options or similar agreements or
arrangements designed to protect the Company or any Subsidiary
from fluctuations in the price of commodities; (xii) Liens
encumbering deposits made in the ordinary course of business to
secure nondelinquent obligations arising from statutory,
regulatory, contractual or warranty requirements of the Company
or its Subsidiaries for which a reserve or other appropriate
provision, if any, as shall be required by GAAP shall have been
made; (xiii) Liens arising out of consignment or similar
arrangements for the sale of goods entered into by the Company
or any Subsidiary in the ordinary course of business in
accordance with past practices; (xiv) any interest or title of
a lessor in the property subject to any lease, whether
characterized as capitalized or operating other than any such
interest or title resulting from or arising out of a default by
the Company or any Subsidiary of its obligations under such
lease; (xv) Liens arising from filing UCC financing statements
for precautionary purposes in connection with true leases of
personal property that are otherwise permitted under this
Indenture and under which the Company or any Subsidiary is
lessee; and (xvi) additional Liens securing Indebtedness in an
aggregate principal amount at any one time outstanding not
exceeding the sum of (i) $25 million and (ii) 10% of the
aggregate Consolidated Net Income of the Company earned
subsequent to the Issue Date and on or prior to such time.
"Permitted Payments" means (i) any payment by the
Company or any Subsidiary, or any dividend by the Company or
any Subsidiary to New Holdings the proceeds of which are
utilized by New Holdings to make payments, to The Yucaipa
Companies or the principals or any Affiliates thereof for
consulting, management, investment banking or similar services,
or for reimbursement of losses, costs and expenses pursuant to
the Consulting Agreement, (ii) any payment by the Company or
33
any Subsidiary pursuant to the Second Amended and Restated Tax
Sharing Agreement, dated as of the Issue Date, by and among
Food 4 Less, all direct and indirect Subsidiaries, and New
Holdings, as such Tax Sharing Agreement may be amended from
time to time, so long as the payment thereunder by the Company
and its Subsidiaries shall not exceed the amount of taxes the
Company would be required to pay if it were the filing person
for all applicable taxes, (iii) any payment by the Company or
any Subsidiary pursuant to the Transfer and Assumption
Agreement, dated as of June 23, 1989, between Food 4 Less and
Holdings, as in effect on the Issue Date, (iv) any payment by
the Company or any Subsidiary, or any dividend by the Company
or any Subsidiary to New Holdings the proceeds of which are
used by New Holdings to make payments (a) in connection with
repurchases of outstanding shares of the Company's or New
Holding's Common Stock following the death, disability or
termination of employment of management stockholders, and
(b) of amounts required to be paid by New Holdings, the Company
or any of its Subsidiaries to participants or former
participants in employee benefit plans upon termination of
employment by such participants, as provided in the documents
related thereto, in an aggregate amount (for both clauses (a)
and (b)) not to exceed $10 million in any Yearly Period
(provided that any unused amounts may be carried over to any
subsequent Yearly Period subject to a maximum amount of
$20 million in any Yearly Period), (v) from and after June 30,
1998, payments of cash dividends or loans to New Holdings in an
amount sufficient to enable New Holdings to make payments of
interest required to be made in respect of the Discount Notes
in an amount not to exceed the amount payable thereunder in
accordance with the terms thereof in effect on the Issue Date,
(vi) from and after June 15, 2000, payments of cash dividends
to New Holdings in an amount sufficient to enable New Holdings
to make payments of interest required to be made in respect of
the Seller Debentures and the New Discount Debentures in an
amount not to exceed the amount payable thereunder in
accordance with the terms thereof in effect on the Issue Date,
(vii) dividends or other payments to New Holdings sufficient to
enable New Holdings to perform accounting, legal, corporate
reporting and administrative functions in the ordinary course
of business or to pay required fees and expenses in connection
with the Merger, the FFL Merger, the Reincorporation Merger and
the registration under applicable laws and regulations of its
debt or equity securities, (viii) dividends or other
distributions by the Company to New Holdings on the Issue Date
of shares of New Holdings common stock owned by the Company,
(ix) dividends by the Company to New Holdings of the Net Cash
Proceeds of an Asset Sale to the extent that (a) the Company or
any of the Subsidiaries is required pursuant to this Indenture
to utilize such Net Cash Proceeds to repay the Securities (and
34
has complied with all such requirements), (b) such Net Cash
Proceeds are not required to be and have not been utilized to
repay outstanding Indebtedness of the Company or any of the
Subsidiaries and (c) New Holdings is required pursuant to the
documents governing any outstanding Indebtedness of New
Holdings to utilize such Net Cash Proceeds to repay such
Indebtedness (it being understood that only the amounts not
utilized as described in clauses (a) and (b) of this clause
(ix) shall be permitted to be distributed to New Holdings
pursuant to this clause (ix)), (x) the exchange by the Company
of Old RGC Notes for New RGC Notes, or the purchase for cash of
up to $27 million aggregate principal amount of Old RGC Notes,
in each case, in accordance with the terms of the RGC Offers,
(xi) the exchange by the Company of Old F4L Senior Subordinated
Notes for New F4L Senior Subordinated Notes in accordance with
the terms of the F4L Exchange Offers, (xii) the repurchase by
the Company of up to $10 million aggregate principal amount of
Old RGC Notes, at a repurchase price of 101% of the principal
amount thereof plus accrued interest to the repurchase date,
pursuant to the "change of control purchase offer" provisions
set forth in section 1014 of the Old RGC Indentures as in
effect on the Issue Date, (xiii) the loan by the Company on the
Issue Date to RGC Investment Co. of not more than $5 million
and (xiv) for so long as the sole business activity of such
partnership is to acquire, hold, sell, exchange, transfer or
otherwise dispose of all or any portion of the New Discount
Debentures and to manage its investment in the New Discount
Debentures, any payment by the Company or any Subsidiary, or
any dividend or loan to New Holdings, the proceeds of which are
utilized by New Holdings to fund ongoing costs and expenses of
RGC Partners, L.P. pursuant to the Subscription Agreement and
the Registration Rights Agreement.
"Permitted Transferees" means, with respect to any
person, (i) any Affiliate of such person, (ii) the heirs,
executors, administrators, testamentary trustees, legatees or
beneficiaries of any such person, (iii) a trust, the
beneficiaries of which, or a corporation or partnership, the
stockholders or general or limited partners of which, include
only such person or his or her spouse or lineal descendants, in
each case to whom such person has transferred the beneficial
ownership of any securities of the Company, (iv) any investment
account whose investment managers and investment advisors
consist solely of such person and/or Permitted Transferees of
such person and (v) any investment fund or investment entity
that is a subsidiary of such person or a Permitted Transferee
of such person.
"person" means any individual, corporation,
partnership, limited liability company, joint venture,
35
association, joint-stock company, trust, unincorporated
organization or government or other agency or political
subdivision thereof.
"Plan of Liquidation" means, with respect to any
person, a plan that provides for, contemplates or the
effectuation of which is preceded or accompanied by (whether or
not substantially contemporaneously, in phases or otherwise)
(i) the sale, lease, conveyance or other disposition of all or
substantially all of the assets of such person otherwise than
as an entirety or substantially as an entirety and (ii) the
distribution of all or substantially all of the proceeds of
such sale, lease, conveyance or other disposition and all or
substantially all of the remaining assets of such person to
holders of Capital Stock of such person.
"Preferred Stock" means, with respect to any person,
Capital Stock of any class or classes (however designated)
which is preferred as to the payment of dividends or
distributions, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such
person, over shares of Capital Stock of any other class of such
person.
"principal" of any Indebtedness (including the
Securities) means the principal of such Indebtedness plus the
premium, if any, on such Indebtedness.
"pro forma" means, with respect to any calculation
made or required to be made pursuant to the terms of this
Indenture, a calculation in accordance with Article 11 of
Regulation S-X under the Securities Act of 1933, as amended, as
interpreted by the Company's chief financial officer or Board
of Directors in consultation with its independent certified
public accountants.
"Public Equity Offering" means an undewritten public
offering of Common Stock of the Company or New Holdings
pursuant to a registration statement filed with the Commission
in accordance with the Securities Act which public equity
offering results in gross proceeds to the Company or New
Holdings, as the case may be, of not less than $20,000,000;
provided, however, that in the case of a Public Equity Offering
by New Holdings, New Holdings contributes to the capital of the
Company net cash proceeds in an amount sufficient to redeem the
Securities called for redemption in accordance with the terms
thereof.
36
"Qualified Capital Stock" means, with respect to any
person, any Capital Stock of such person that is not
Disqualified Capital Stock.
"Ralphs Grocery Company" means Ralphs Grocery
Company, Inc., a Delaware corporation, and its successors.
"Record Date" means the Record Dates specified in the
Securities; provided that if any such date is a Legal Holiday,
the Record Date shall be the first day immediately preceding
such specified day that is not a Legal Holiday.
"Redemption Date," when used with respect to any
Security to be redeemed, means the date fixed for such
redemption pursuant to this Indenture and Paragraph 5 of the
Securities annexed hereto as Exhibit A.
"Redemption Price," when used with respect to any
Security to be redeemed, means the price fixed for such
redemption pursuant to this Indenture and Paragraph 5 of the
Securities annexed hereto as Exhibit A.
"Reference Date" shall have the meaning provided in
Section 4.03.
"Reference Period" shall have the meaning provided in
the definition of "Operating Coverage Ratio" contained in this
Section 1.01.
"Refinancing Indebtedness" means, with respect to any
person, Indebtedness of such person issued in exchange for, or
the proceeds from the issuance and sale or disbursement of
which are used to substantially concurrently repay, redeem,
refund, refinance, discharge or otherwise retire for value, in
whole or in part (collectively, "repay"), or constituting an
amendment, modification or supplement to, or a deferral or
renewal of (collectively, an "amendment"), any Indebtedness of
such person existing on the Issue Date or Indebtedness (other
than Permitted Indebtedness, except Permitted Indebtedness
incurred pursuant to clauses (c), (d), (h) and (j) of the
definition thereof) incurred in accordance with this Indenture
(a) in a principal amount (or, if such Refinancing Indebtedness
provides for an amount less than the principal amount thereof
to be due and payable upon the acceleration thereof, with an
original issue price) not in excess of (without duplication)
(i) the principal amount or the original issue price, as the
case may be, of the Indebtedness so refinanced (or, if such
Refinancing Indebtedness refinances Indebtedness under a
revolving credit facility or other agreement providing a
commitment for subsequent borrowings, with a maximum commitment
37
not to exceed the maximum commitment under such revolving
credit facility or other agreement) plus (ii) unpaid accrued
interest on such Indebtedness plus (iii) premiums, penalties,
fees and expenses actually incurred by such person in
connection with the repayment or amendment thereof and (b) with
respect to Refinancing Indebtedness that repays or constitutes
an amendment to Subordinated Indebtedness, such Refinancing
Indebtedness (x) shall not have any fixed mandatory redemption
or sinking fund requirement in an amount greater than or at a
time prior to the amounts and times specified in such repaid or
amended Subordinated Indebtedness, except to the extent that
any such requirement applies on a date after the Maturity Date
and (y) shall contain subordination and default provisions no
less favorable in any material respect to Holders than those
contained in such repaid or amended Subordinated Indebtedness.
"Registrar" shall have the meaning provided in
Section 2.03.
"Registration Rights Agreement" means that certain
Registration Rights Agreement by and between RGC Partners,
L.P., New Holdings and Food 4 Less, as such Registration Rights
Agreement may be amended or replaced, so long as any amounts
paid by New Holdings and the Company under any amended or
replacement agreement do not exceed the amounts payable by New
Holdings and the Company under such Registration Rights
Agreement as in effect on the Issue Date.
"Reincorporation Merger" means the merger, prior to
the Merger, of Holdings with and into New Holdings.
"Related Business Investment" means (i) any
Investment by a person in any other person a majority of whose
revenues are derived from the operation of one or more retail
grocery stores or supermarkets or any other line of business
engaged in by the Company or any of its Subsidiaries as of the
Issue Date; (ii) any Investment by such person in any
cooperative or other supplier, including, without limitation,
any joint venture which is intended to supply any product or
service useful to the business of the Company and its
Subsidiaries as it is conducted as of the Issue Date and as
such business may thereafter evolve or change; and (iii) any
capital expenditure or Investment, in each case reasonably
related to the business of the Company and its Subsidiaries as
it is conducted as of the Issue Date and as such business may
thereafter evolve or change.
"Representative" means the indenture trustee or other
trustee, agent or representative for any Senior Indebtedness;
provided that in no event shall United States Trust Company of
38
New York, in its capacities as Trustee, Registrar, co-Registrar
or Paying Agent, serve as Representative.
"Restricted Debt Prepayment" means any purchase,
redemption, defeasance (including, but not limited to,
in-substance or legal defeasance) or other acquisition or
retirement for value, directly or indirectly, by the Company or
a Subsidiary, prior to the scheduled maturity or prior to any
scheduled repayment of principal or sinking fund payment, as
the case may be, in respect of Subordinated Indebtedness.
"Restricted Payment" means any (i) Stock Payment,
(ii) Investment (other than a Permitted Investment) or
(iii) Restricted Debt Prepayment.
"RGC Offers" means, the offer by the Company as
described in the Amended and Restated Prospectus and
Solicitation Statement dated May 12, 1995 (as supplemented) to
holders of Old RGC Notes to exchange such notes for New RGC
Notes.
"RSI" means Ralphs Supermarkets Inc., a Delaware
corporation.
"Securities" means the Company's 11% Senior Notes due
2004, as amended or supplemented from time to time in
accordance with the terms hereof, that are issued pursuant to
this Indenture.
"Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations of the Commission
promulgated thereunder.
"Seller Debentures" means the 13 5/8% Senior
Subordinated Pay-in-Kind Debentures due 2007 of New Holdings
issued pursuant to the Seller Debenture Indenture, including
any additional 13 5/8% Senior Subordinated Pay-in-Kind
Debentures due 2007 issued as interest thereon, in each case,
as such Seller Debentures may be modified or amended from time
to time and future refinancings thereof to the extent such
refinancings are permitted under this Indenture.
"Seller Debenture Indenture" means the indenture
between New Holdings and Norwest Bank, Minnesota, National
Association, as trustee, dated as of the Issue Date under which
the 13 5/8% Senior Subordinated Pay-in-Kind Debentures due 2007
of New Holdings were issued, as the same may be modified and
amended from time to time and refinancings thereof to the
extent such refinancings are pemitted under this Indenture.
39
"Senior Subordinated Note Indentures" means,
together, (i) the indenture dated as of the Issue Date between
the Company, the Subsidiary Guarantors and the United States
Trust Company of New York, as trustee, pursuant to which the
Company issued $ of 11% Senior Subordinated Notes due
2005, and (ii) the indenture dated as of the Issue Date between
the Company, the Subsidiary Guarantors and the United States
Trust Company of New York, as trustee, pursuant to which the
Company issued $ of 13.75% Senior Subordinated Notes
due 2005.
"Significant Stockholder" means, with respect to any
person, any other person who is the beneficial owner (within
the meaning of Rule 13d-3 under the Exchange Act) of more than
10% of any class of equity securities of such person that are
entitled to vote on a regular basis for the election of
directors of such person.
"Significant Subsidiary" means each subsidiary of the
Company that is either (a) a "significant subsidiary" as
defined in Rule 1-02(v) of Regulation S-X under the Securities
Act and the Exchange Act (as such regulation is in effect on
the Issue Date) or (b) material to the financial condition or
results of operations of the Company and its Subsidiaries taken
as a whole.
"Stock Payment" means, with respect to any person,
(a) the declaration or payment by such person, either in cash
or in property, of any dividend on (except, in the case of the
Company, dividends payable solely in Qualified Capital Stock of
the Company), or the making by such person or any of its
subsidiaries of any other distribution in respect of, such
person's Qualified Capital Stock or any warrants, rights or
options to purchase or acquire shares of any class of such
Capital Stock (other than exchangeable or convertible
Indebtedness of such person), or (b) the redemption,
repurchase, retirement or other acquisition for value by such
person or any of its subsidiaries, directly or indirectly, of
such person's Qualified Capital Stock (and, in the case of a
Subsidiary, Qualified Capital Stock of the Company) or any
warrants, rights or options to purchase or acquire shares of
any class of such Capital Stock (other than exchangeable or
convertible Indebtedness of such person), other than, in the
case of the Company, through the issuance in exchange therefor
solely of Qualified Capital Stock of the Company; provided,
however, that in the case of a Subsidiary, the term "Stock
Payment" shall not include any such payment with respect to its
Capital Stock or warrants, rights or options to purchase or
acquire shares of any class of its Capital Stock that are owned
solely by the Company or a wholly owned Subsidiary.
40
"Subordinated Indebtedness" means, with respect to
the Company or any Subsidiary Guarantor, Indebtedness of such
person which is subordinated in right of payment to the
Securities or the Guarantee of such Subsidiary Guarantor, as
the case may be.
"Subscription Agreement" means that certain
Subscription Agreement, between RGC Partners, L.P., New
Holdings, Food 4 Less and the partnership investors listed on
Exhibit A thereto, as such Subscription Agreement may be
amended or replaced, so long as any amounts paid by New
Holdings and the Company under any amended or replacement
agreement do not exceed the amounts payable by New Holdings and
the Company under such Subscription Agreement as in effect on
the Issue Date.
"subsidiary" of any person means (i) a corporation a
majority of whose Capital Stock with voting power, under
ordinary circumstances, to elect directors is, at the date of
determination, directly or indirectly, owned by such person, by
one or more subsidiaries of such person or by such person and
one or more subsidiaries of such person or (ii) a partnership
in which such person or a subsidiary of such person is, at the
date of determination, a general partner of such partnership,
but only if such person or its subsidiary is entitled to
receive more than fifty percent of the assets of such
partnership upon its dissolution, or (iii) any other person
(other than a corporation or a partnership) in which such
person, a subsidiary of such person or such person and one or
more subsidiaries of such person, directly or indirectly, at
the date of determination, has (x) at least a majority
ownership interest or (y) the power to elect or direct the
election of a majority of the directors or other governing body
of such person.
"Subsidiary" means any subsidiary of the Company.
"Subsidiary Guarantor" means (i) each of Alpha Beta
Company, Bay Area Warehouse Stores, Inc., Bell Markets, Inc.,
Cala Co., Cala Foods, Inc., Falley's Inc., Food 4 Less of
California, Inc., Food 4 Less Merchandising, Inc., Food 4 Less
GM, Inc. and Food 4 Less of Southern California, Inc., (ii)
upon consummation of the Merger, Crawford Stores, Inc., (iii)
each of the Company's Subsidiaries which becomes a guarantor of
the Securities in compliance with the provisions set forth in
Section 4.17, and (iv) each of the Company's Subsidiaries
executing a supplemental indenture in which such Subsidiary
agrees to be bound by the terms of this Indenture.
41
"Term Loans" means the term loan facility under the
Credit Agreement and any agreement governing Indebtedness
incurred to refund, replace or refinance any borrowings
outstanding under such facility or under any prior refunding,
replacement or refinancing thereof (in each case, in whole or
in part, and without limitation as to amount, terms conditions,
covenants and other provisions).
"The Yucaipa Companies" means The Yucaipa Companies,
a California general partnership, or any successor thereto
which is an affiliate of Ronald W. Burkle or his Permitted
Transferees and which has been established for the sole purpose
of changing the form of The Yucaipa Companies from that of a
partnership to that of a limited liability company or any other
form of entity which is not materially adverse to the rights of
the Holders under this Indenture.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.
Code {{ 77aaa-77bbbb), as amended, as in effect on the date
this Indenture is qualified under the TIA, except as otherwise
provided in Section 9.03.
"Transaction Date" shall have the meaning provided in
the definition of "Operating Coverage Ratio" contained in this
Section 1.01.
"Trustee" means the party named as such in this
Indenture until a successor replaces it in accordance with the
provisions of this Indenture and thereafter means such
successor.
"Trust Officer" means any officer of the Trustee
assigned by the Trustee to administer its corporate trust
matters.
"U.S. Government Obligations" shall have the meaning
provided in Section 8.02.
"U.S. Legal Tender" means such coin or currency of
the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts.
"Yearly Period" means each fiscal year of the
Company; provided that the first Yearly Period shall begin on
the Issue Date and shall end on January 28, 1996.
SECTION 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the
TIA, such provision is incorporated by reference in, and made a
42
part of, this Indenture. The following TIA terms used in this
Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder or a
Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means
the Trustee.
"obligor" on the indenture securities means the
Company, any Subsidiary Guarantor, or any other obligor on the
Securities or the Guarantees.
All other TIA terms used in this Indenture that are
defined by the TIA, defined by TIA reference to another statute
or defined by SEC rule and not otherwise defined herein have
the meanings assigned to them therein.
SECTION 1.03. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and
words in the plural include the singular;
(5) provisions apply to successive events and
transactions; and
(6) "herein," "hereof" and other words of similar
import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
43
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities, the notation thereon relating to the
Guarantee and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit A. The Securities may
have notations, legends or endorsements required by law, stock
exchange rule or usage. The Company and the Trustee shall
approve the form of the Securities and any notation, legend or
endorsement on them. Each Security shall be dated the date of
its authentication.
The terms and provisions contained in the Securities
and the Guarantee shall constitute, and are hereby expressly
made, a part of this Indenture and, to the extent applicable,
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.
SECTION 2.02. Execution and Authentication.
Two Officers, or an Officer and an Assistant
Secretary, shall sign, or one Officer shall sign and one
Officer or an Assistant Secretary (each of whom shall, in each
case, have been duly authorized by all requisite corporate
actions) shall attest to, the Securities for the Company by
manual or facsimile signature. Each Subsidiary Guarantor shall
execute the Guarantee in the manner set forth in Section 10.08.
If an Officer whose signature is on a Security was an
Officer at the time of such execution but no longer holds that
office at the time the Trustee authenticates the Security, the
Security shall be valid nevertheless.
A Security shall not be valid until an authorized
signatory of the Trustee manually signs the certificate of
authentication on the Security. The signature shall be
conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate Securities for
original issue in the aggregate principal amount of up to
$525,000,000 (or such lesser amount (but not less than
$520,326,000 aggregate principal amount) as is authenticated by
the Trustee and issued by the Company on the Issue Date) upon a
written order of the Company in the form of an Officers'
44
Certificate. The Officers' Certificate shall specify the
amount of Securities to be authenticated and the date on which
the Securities are to be authenticated. The aggregate
principal amount of Securities outstanding at any time may not
exceed $525,000,000 (or such lesser amount (but not less than
$520,326,000 aggregate principal amount) as is authenticated by
the Trustee and issued by the Company on the Issue Date),
except as provided in Section 2.07. Upon the written order of
the Company in the form of an Officers' Certificate, the
Trustee shall authenticate Securities in substitution of
Securities originally issued to reflect any name change of the
Company.
The Trustee may appoint an authenticating agent
reasonably acceptable to the Company to authenticate
Securities. Unless otherwise provided in the appointment, an
authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as an Agent
to deal with the Company and Affiliates of the Company.
The Securities shall be issuable only in registered
form without coupons in denominations of $1,000 and integral
multiples thereof.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency in the
Borough of Manhattan, The City of New York, where (a) Secu-
rities may be presented or surrendered for registration of
transfer or for exchange ("Registrar"), (b) Securities may be
presented or surrendered for payment ("Paying Agent") and
(c) notices and demands to or upon the Company in respect of
the Securities and this Indenture may be served. The Company
may also from time to time designate one or more other offices
or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to
time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York, for such
purposes. The Company may act as its own Registrar or Paying
Agent except that for the purposes of Articles Three and Eight
and Sections 4.15 and 4.16, neither the Company nor any
Affiliate of the Company shall act as Paying Agent. The
Registrar shall keep a register of the Securities and of their
transfer and exchange. The Company, upon notice to the
Trustee, may have one or more co-Registrars and one or more
additional paying agents reasonably acceptable to the Trustee.
45
The term "Paying Agent" includes any additional paying agent.
The Company initially appoints the Trustee as Registrar and
Paying Agent until such time as the Trustee has resigned or a
successor has been appointed.
The Company shall enter into an appropriate agency
agreement with any Agent not a party to this Indenture, which
agreement shall implement the provisions of this Indenture that
relate to such Agent. The Company shall notify the Trustee, in
advance, of the name and address of any such Agent. If the
Company fails to maintain a Registrar or Paying Agent, the
Trustee shall act as such.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other
than the Trustee to agree in writing that each Paying Agent
shall hold in trust for the benefit of Holders or the Trustee
all assets held by the Paying Agent for the payment of
principal of, or interest on, the Securities (whether such
assets have been distributed to it by the Company or any other
obligor on the Securities), and shall notify the Trustee of any
Default by the Company (or any other obligor on the Securities)
in making any such payment. If the Company or a Subsidiary
acts as Paying Agent, it shall segregate such assets and hold
them as a separate trust fund. The Company at any time may
require a Paying Agent to distribute all assets held by it to
the Trustee and account for any assets disbursed and the
Trustee may at any time during the continuance of any payment
Default, upon written request to a Paying Agent, require such
Paying Agent to distribute all assets held by it to the Trustee
and to account for any assets distributed. Upon distribution
to the Trustee of all assets that shall have been delivered by
the Company to the Paying Agent, the Paying Agent shall have no
further liability for such assets.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of
the names and addresses of Holders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee on or
before each Interest Payment Date and at such other times as
the Trustee may request in writing a list in such form and as
of such date as the Trustee may reasonably require of the names
and addresses of Holders, which list may be conclusively relied
upon by the Trustee.
46
SECTION 2.06. Transfer and Exchange.
When Securities are presented to the Registrar or a
co-Registrar with a request to register the transfer of such
Securities or to exchange such Securities for an equal
principal amount of Securities of other authorized
denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested if its requirements
for such transaction are met; provided, however, that the
Securities surrendered for transfer or exchange shall be duly
endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Registrar or
co-Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing. To permit registrations
of transfers and exchanges, the Company shall execute and the
Trustee shall authenticate Securities at the Registrar's or
co-Registrar's request. No service charge shall be made for
any registration of transfer or exchange, but the 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 exchanges or transfers pursuant to Sections
2.02, 2.07, 2.10, 3.06, 4.15, 4.16 or 9.05). The Registrar or
co-Registrar shall not be required to register the transfer of
or exchange of any Security (i) during a period beginning at
the opening of business 15 days before the mailing of a notice
of redemption of Securities and ending at the close of business
on the day of such mailing and (ii) selected for redemption in
whole or in part pursuant to Article Three, except the
unredeemed portion of any Security being redeemed in part.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee
or if the Holder of a Security claims that the Security has
been lost, destroyed or wrongfully taken, the Company shall
issue and the Trustee shall authenticate a replacement Security
if the Trustee's requirements are met. If required by the
Trustee or the Company, such Holder must provide an indemnity
bond or other indemnity, sufficient in the judgment of both the
Company and the Trustee, to protect the Company, the Trustee or
any Agent from any loss which any of them may suffer if a
Security is replaced. The Company may charge such Holder for
its reasonable, out-of-pocket expenses in replacing a Security,
including reasonable fees and expenses of counsel.
Every replacement Security is an additional
obligation of the Company.
47
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the
Securities that have been authenticated by the Trustee except
those cancelled by it, those delivered to it for cancellation
and those described in this Section as not outstanding. A
Security does not cease to be outstanding because the Company,
the Subsidiary Guarantors or any of their respective Affiliates
holds the Security.
If a Security is replaced pursuant to Section 2.07
(other than a mutilated Security surrendered for replacement),
it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Security is held by a bona
fide purchaser. A mutilated Security ceases to be outstanding
upon surrender of such Security and replacement thereof
pursuant to Section 2.07.
If on a Redemption Date or the Maturity Date the
Paying Agent (other than the Company or a Subsidiary) holds
U.S. Legal Tender or U.S. Government Obligations sufficient to
pay all of the principal and interest due on the Securities
payable on that date, then on and after that date such
Securities cease to be outstanding and interest on them ceases
to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required
principal amount of Securities have concurred in any direction,
waiver or consent, Securities owned by the Company, the
Subsidiary Guarantors or any of their respective Affiliates
shall be disregarded, except that, for the purposes of
determining whether the Trustee shall be protected in relying
on any such direction, waiver or consent, only Securities that
the Trustee knows or has reason to know are so owned shall be
disregarded.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery,
the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have
variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities.
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SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the
Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them
for transfer, exchange or payment. The Trustee, or at the
direction of the Trustee, the Registrar or the Paying Agent
(other than the Company or a Subsidiary), and no one else,
shall cancel and, at the written direction of the Company,
shall dispose of all Securities surrendered for transfer,
exchange, payment or cancellation. Subject to Section 2.07,
the Company may not issue new Securities to replace Securities
that it has paid or delivered to the Trustee for cancellation.
If the Company or any Subsidiary Guarantor shall acquire any of
the Securities, such acquisition shall not operate as a
redemption or satisfaction of the Indebtedness represented by
such Securities unless and until the same are surrendered to
the Trustee for cancellation pursuant to this Section 2.11.
SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on
the Securities, it shall, unless the Trustee fixes another
record date pursuant to Section 6.10, pay the defaulted
interest, plus (to the extent lawful) any interest payable on
the defaulted interest, to the persons who are Holders on a
subsequent special record date, which date shall be the
fifteenth day next preceding the date fixed by the Company for
the payment of defaulted interest or the next succeeding
Business Day if such date is not a Business Day. At least 15
days before the subsequent special record date, the Company
shall mail to each Holder, with a copy to the Trustee, a notice
that states the subsequent special record date, the payment
date and the amount of defaulted interest, and interest payable
on such defaulted interest, if any, to be paid.
SECTION 2.13. CUSIP Number.
The Company in issuing the Securities may use a
"CUSIP" number, and if so, the Trustee shall use the CUSIP
number in notices of redemption or exchange as a convenience to
Holders; provided that any such notice may state that no
representation is made as to the correctness or accuracy of the
CUSIP number printed in the notice or on the Securities, and
that reliance may be placed only on the other identification
numbers printed on the Securities.
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ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company elects to redeem Securities pursuant
to Paragraph 5 of the Securities, it shall notify the Trustee,
with a copy to the Credit Agent, of the Redemption Date and the
principal amount of Securities to be redeemed and whether it
wants the Trustee to give notice of redemption to the Holders
at least 30 days (unless a shorter notice shall be satisfactory
to the Trustee) but not more than 60 days before the Redemption
Date. In order to effect a redemption pursuant to Paragraph 5
of the Securities with the proceeds of a Public Equity
Offering, the Company shall send the redemption notice not
later than 60 days after the consummation of such Public Equity
Offering. Any such notice may be cancelled at any time prior
to notice of such redemption being mailed to any Holder and
shall thereby be void and of no effect.
SECTION 3.02. Selection of Securities To Be Redeemed.
If fewer than all of the Securities are to be
redeemed, the Trustee shall select the Securities to be
redeemed pro rata by lot or by any other method that the
Trustee considers fair and appropriate and, if such Securities
are listed on any securities exchange, by a method that
complies with the requirements of such exchange; provided,
however, that any redemption pursuant to Paragraph 5 of the
Securities with the proceeds of a Public Equity Offering shall
be made on a pro rata basis unless such method is otherwise
legally prohibited.
The Trustee shall make the selection from the
Securities outstanding and not previously called for redemption
and shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any
Security selected for partial redemption, the principal amount
thereof to be redeemed. Securities in denominations of $1,000
may be redeemed only in whole. The Trustee may select for
redemption portions (equal to $1,000 or integral multiples
thereof) of the principal amount of Securities that have
denominations larger than $1,000. Provisions of this Indenture
that apply to Securities called for redemption also apply to
portions of Securities called for redemption.
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SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a
Redemption Date, the Company shall mail a notice of redemption
by first class mail to each Holder whose Securities are to be
redeemed at such Holder's registered address, with a copy to
the Trustee and the Credit Agent. In order to effect a
redemption pursuant to Paragraph 5 of the Securities with the
proceeds of a Public Equity Offering, the Company shall send
the redemption notice not later than 60 days after the
consummation of such Public Equity Offering. At the Company's
request, the Trustee shall give the notice of redemption in the
Company's name and at the Company's expense. Each notice for
redemption shall identify the Securities to be redeemed and
shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption
Price;
(5) that, unless the Company defaults in making the
redemption payment interest on Securities called for
redemption ceases to accrue on and after the Redemption
Date, and the only remaining right of the Holders of such
Securities is to receive payment of the Redemption Price
upon surrender to the Paying Agent of the Securities
redeemed;
(6) if any Security is being redeemed in part, the
portion of the principal amount of such Security to be
redeemed and that, after the Redemption Date, and upon
surrender of such Security, a new Security or Securities
in aggregate principal amount equal to the unredeemed
portion thereof will be issued; and
(7) if fewer than all the Securities are to be
redeemed, the identification of the particular Securities
(or portion thereof) to be redeemed, as well as the
aggregate principal amount of Securities to be redeemed
and the aggregate principal amount of Securities to be
outstanding after such partial redemption.
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SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance
with Section 3.03, Securities called for redemption become due
and payable on the Redemption Date and at the Redemption Price.
Upon surrender to the Trustee or Paying Agent, such Securities
called for redemption shall be paid at the Redemption Price.
Securities that are redeemed by the Company or that are
purchased by the Company pursuant to a Net Proceeds Offer as
described in Section 4.16 or pursuant to a Change of Control
Offer as described in Section 4.15 or that are otherwise
acquired by the Company will be surrendered to the Trustee for
cancellation.
SECTION 3.05. Deposit of Redemption Price.
On or before the Redemption Date, the Company shall
deposit with the Paying Agent U.S. Legal Tender sufficient to
pay the Redemption Price of all Securities to be redeemed on
that date (other than Securities or portions thereof called for
redemption on that date which have been delivered by the
Company to the Trustee for cancellation). The Paying Agent
shall promptly return to the Company any U.S. Legal Tender so
deposited which is not required for that purpose upon the
written request of the Company, except with respect to monies
owed as obligations to the Trustee pursuant to Article Seven
hereof.
If the Company complies with the preceding paragraph
then, unless the Company defaults in the payment of such
Redemption Price, interest on the Securities to be redeemed
will cease to accrue on and after the applicable Redemption
Date, whether or not such Securities are presented for payment.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed
in part, the Trustee shall authenticate for the Holder a new
Security or Securities equal in principal amount to the
unredeemed portion of the Security surrendered.
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ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest
on the Securities on the dates and in the manner provided in
the Securities. An installment of principal of or interest on
the Securities shall be considered paid on the date it is due
if the Trustee or Paying Agent (other than the Company or a
Subsidiary) holds on that date U.S. Legal Tender designated for
and sufficient to pay the installment.
The Company shall pay interest on overdue principal
at the rate borne by the Securities and it shall pay interest
on overdue installments of interest at the same rate, to the
extent lawful.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of
Manhattan, The City of New York, the office or agency required
under Section 2.03 hereof. The Company shall give prior notice
to the Trustee of the location, and any change in the location,
of such office or agency. If at any time the 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 address of the Trustee set forth in Section
11.02.
SECTION 4.03. Limitation on Restricted Payments.
The Company shall not, and shall cause each of its
Subsidiaries not to, directly or indirectly, make any
Restricted Payment if, at the time of such proposed Restricted
Payment, or after giving effect thereto, (a) a Default or an
Event of Default shall have occurred and be continuing, (b) the
Company could not incur $1.00 of additional Indebtedness (other
than Permitted Indebtedness) pursuant to Section 4.12 or
(c) the aggregate amount expended for all Restricted Payments,
including such proposed Restricted Payment (the amount of any
Restricted Payment, if other than cash, to be the fair market
value thereof at the date of payment, as determined in good
faith by the Board of Directors of the Company), subsequent to
the Issue Date, shall exceed the sum of (i) 50% of the
aggregate Consolidated Net Income (or if such aggregate
Consolidated Net Income is a loss, minus 100% of such loss) of
53
the Company earned subsequent to the Issue Date and on or prior
to the date of the proposed Restricted Payment (the "Reference
Date"), plus (ii) 100% of the aggregate Net Proceeds received
by the Company from any person (other than a Subsidiary of the
Company) from the issuance and sale (including upon exchange or
conversion for other securities of the Company) subsequent to
the Issue Date and on or prior to the Reference Date of
Qualified Capital Stock (excluding (A) Qualified Capital Stock
paid as a dividend on any Capital Stock or as interest on any
Indebtedness and (B) any Net Proceeds from issuances and sales
financed directly or indirectly using funds borrowed from the
Company or any Subsidiary, until and to the extent such
borrowing is repaid), plus (iii) 100% of the aggregate net cash
proceeds received by the Company as capital contributions to
the Company after the Issue Date, plus (iv) $25 million.
Notwithstanding the foregoing, if no Default or Event
of Default shall have occurred and be continuing as a
consequence thereof, the provisions set forth in the
immediately preceding paragraph will not prevent (1) the
payment of any dividend within 60 days after the date of its
declaration if the dividend would have been permitted on the
date of declaration, (2) the acquisition of any shares of
Capital Stock of the Company or the repurchase, redemption or
other repayment of any Subordinated Indebtedness in exchange
for or solely out of the proceeds of the substantially
concurrent sale (other than to a Subsidiary) of shares of
Qualified Capital Stock of the Company, (3) the repurchase,
redemption or other repayment of any Subordinated Indebtedness
in exchange for or solely out of the proceeds of the
substantially concurrent sale (other than to a Subsidiary) of
Subordinated Indebtedness of the Company with an Average Life
equal to or greater than the then remaining Average Life of the
Subordinated Indebtedness repurchased, redeemed or repaid,
(4) any payments by the Company or any Subsidiary, or any
dividend by the Company or any Subsidiary to New Holdings the
proceeds of which are used by New Holdings to make payments, in
each case, required to be made due to the exercise of statutory
dissenters', appraisal or similar rights by holders of common
stock of FFL in connection with the FFL Merger and (5) Permit-
ted Payments; provided, however, that the declaration of each
dividend paid in accordance with clause (1) above, each
acquisition, repurchase, redemption or other repayment made in
accordance with, or of the type set forth in, clause (2) above,
and each payment described in clause (iii), (iv), (vii), and
(ix) of the definition of the term "Permitted Payments" shall
each be counted for purposes of computing amounts expended
pursuant to subclause (c) in the immediately preceding
paragraph, and no amounts expended pursuant to clause (3) or
(4) above or pursuant to clauses (i), (ii), (v), (vi), (viii),
54
(x), (xi), (xii), (xiii) and (xiv) of the definition of the
term "Permitted Payments" shall be so counted; provided further
that to the extent any payments made pursuant to clause (vii)
of the definition of the term "Permitted Payments" are deducted
for purposes of computing the Consolidated Net Income of the
Company, such payments shall not be counted for purposes of
computing amounts expended as Restricted Payments pursuant to
subclause (c) in the immediately preceding paragraph.
Prior to making any Restricted Payment under the
first paragraph of this Section 4.03, the Company shall deliver
to the Trustee an Officers' Certificate setting forth the
computation by which the amount available for Restricted
Payments pursuant to such paragraph was determined. The
Trustee shall have no duty or responsibility to determine the
accuracy or correctness of this computation and shall be fully
protected in relying on such Officers' Certificate.
SECTION 4.04. Corporate Existence.
Except as otherwise permitted by Article Five, the
Company shall do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate
existence and the corporate or other existence of each of its
Significant Subsidiaries in accordance with the respective
organizational documents of each such Significant Subsidiary
and the rights (charter and statutory) and franchises of the
Company and each such Significant Subsidiary; provided,
however, that the Company shall not be required to preserve,
with respect to itself, any right or franchise, and with
respect to any of its Significant Subsidiaries, any such
existence, right or franchise, if the Board of Directors of the
Company or such Significant Subsidiary, as the case may be,
shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company or any
such Significant Subsidiary.
SECTION 4.05. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be
paid or discharged, before the same shall become delinquent,
(i) all taxes, assessments and governmental charges (including
withholding taxes and any penalties, interest and additions to
taxes) levied or imposed upon it or any of its Subsidiaries or
properties of it or any of its Subsidiaries and (ii) all lawful
claims for labor, materials and supplies that, if unpaid, might
by law become a Lien upon the property of it or any of its
Subsidiaries; provided, however, that the Company shall not be
required to pay or discharge or cause to be paid or discharged
any such tax, assessment, charge or claim if either (a) the
55
amount, applicability or validity thereof is being contested in
good faith by appropriate proceedings and an adequate reserve
has been established therefor to the extent required by GAAP or
(b) the failure to make such payment or effect such discharge
(together with all other such failures) would not have a
material adverse effect on the financial condition or results
or operations of the Company and its Subsidiaries taken as a
whole.
SECTION 4.06. Maintenance of Properties and Insurance.
(a) The Company shall cause all properties used or
useful to the conduct of its business or the business of any of
its Subsidiaries to be maintained and kept in good condition,
repair and working order and supplied with all necessary
equipment and shall cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof,
all as in its judgment may be necessary, so that the business
carried on in connection therewith may be properly and
advantageously conducted at all times unless the failure to so
maintain such properties (together with all other such
failures) would not have a material adverse effect on the
financial condition or results of operations of the Company and
its Subsidiaries taken as a whole; provided, however, that
nothing in this Section 4.06 shall prevent the Company or any
Subsidiary from discontinuing the operation or maintenance of
any of such properties, or disposing of any of them, if such
discontinuance or disposal is either (i) in the ordinary course
of business, (ii) in the good faith judgment of the Board of
Directors of the Company or the Subsidiary concerned, or of the
senior officers of the Company or such Subsidiary, as the case
may be, desirable in the conduct of the business of the Company
or such Subsidiary, as the case may be, or (iii) is otherwise
permitted by this Indenture.
(b) The Company shall provide or cause to be
provided, for itself and each of its Subsidiaries, insurance
(including appropriate self-insurance) against loss or damage
of the kinds that, in the reasonable, good faith opinion of the
Company are adequate and appropriate for the conduct of the
business of the Company and such Subsidiaries in a prudent
manner, with reputable insurers or with the government of the
United States of America or an agency or instrumentality
thereof, in such amounts, with such deductibles, and by such
methods as shall be either (i) consistent with past practices
of the Company or the applicable Subsidiary or (ii) customary,
in the reasonable, good faith opinion of the Company, for
corporations similarly situated in the industry, unless the
failure to provide such insurance (together with all other such
failures) would not have a material adverse effect on the
56
financial condition or results of operations of the Company and
its Subsidiaries, taken as a whole.
SECTION 4.07. Compliance Certificate; Notice of Default.
(a) The Company shall deliver to the Trustee within
120 days after the end of the Company's fiscal year an
Officers' Certificate stating that a review of its activities
and the activities of its Subsidiaries during the preceding
fiscal year has been made under the supervision of the signing
Officers with a view to determining whether it has kept,
observed, performed and fulfilled its obligations under this
Indenture and further stating, as to each such Officer signing
such certificate, that to the best of his knowledge the Company
during such preceding fiscal year has kept, observed, performed
and fulfilled each and every such covenant and no event of
default in respect of any payment obligation under the Credit
Agreement, Default or Event of Default occurred during such
year or, if such signers do know of such an event of default,
Default or Event of Default, the certificate shall describe the
event of default, Default or Event of Default and its status
with particularity. The Officers' Certificate shall also
notify the Trustee should the Company elect to change the
manner in which it fixes its fiscal year end.
(b) So long as not contrary to the then current
recommendations of the American Institute of Certified Public
Accountants, the Company shall deliver to the Trustee within
120 days after the end of each fiscal year a written statement
by the Company's independent certified public accountants
stating (A) that their audit examination has included a review
of the terms of this Indenture and the Securities as they
relate to accounting matters, and (B) whether, in connection
with their audit examination, any Default has come to their
attention and if such a Default has come to their attention,
specifying the nature and period of existence thereof.
(c) The Company shall deliver to the Trustee,
forthwith upon becoming aware, and in any event within 5 days
after the occurrence, of (i) any Default or Event of Default in
the performance of any covenant, agreement or condition
contained in this Indenture; (ii) any event of default in
respect of any payment obligation under the Credit Agreement or
any event of default under any other bond, debenture, note, or
other evidence of Indebtedness of the Company or any of its
Subsidiaries, or under any mortgage, indenture or other
instrument if such event of default related to Indebtedness at
any time in an aggregate principal amount exceeding $20
million, an Officers' Certificate specifying with particularity
such event.
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SECTION 4.08. Compliance with Laws.
The Company shall comply, and shall cause each of its
Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of
America, all states and municipalities thereof, and of any
governmental department, commission, board, regulatory
authority, bureau, agency and instrumentality of the foregoing,
in respect of the conduct of their respective businesses and
the ownership of their respective properties, except such as
are being contested in good faith and by appropriate
proceedings and except for such noncompliances as would not in
the aggregate have a material adverse effect on the financial
condition or results of operations of the Company and its
Subsidiaries taken as a whole.
SECTION 4.09. SEC Reports.
The Company will deliver to the Trustee within 15
days after the filing of the same with the Commission, copies
of the quarterly and annual report and of the information
documents and other reports, if any, which the Company is
required to file with the Commission pursuant to Section 13 or
15(d) of the Securities Exchange Act. Notwithstanding that the
Company may not be subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, the Company will file
with the Commission, to the extent permitted, and provide the
Trustee and Holders of Securities with such annual reports and
such information, documents and other reports specified in
Section 13 and 15(d) of the Exchange Act. The Company will
also comply with the other provisions of TIA Section 314(a).
SECTION 4.10. Waiver of Stay, Extension or Usury Laws.
The Company covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon,
plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Company from
paying all or any portion of the principal of or interest on
the Securities as contemplated herein, wherever enacted, now or
at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and (to the
extent that it may lawfully do so) the Company hereby expressly
waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had
been enacted.
58
SECTION 4.11. Limitation on Transactions with Affiliates.
(a) Neither the Company nor any of its Subsidiaries
shall (i) sell, lease, transfer or otherwise dispose of any of
its properties or assets, or issue securities (other than
equity securities which do not constitute Disqualified Capital
Stock) to, (ii) purchase any property, assets or securities
(other than equity securities which do not constitute
Disqualified Capital Stock) from, (iii) make any Investment in,
or (iv) enter into or suffer to exist any contract or agreement
with or for the benefit of, an Affiliate or Significant
Stockholder (or any Affiliate of such Significant Stockholder)
of the Company or any Subsidiary (an "Affiliate Transaction"),
other than (x) Affiliate Transactions permitted under Section
4.11(b) and (y) Affiliate Transactions in the ordinary course
of business that are fair to the Company or such Subsidiary, as
the case may be, and on terms at least as favorable as might
reasonably have been obtainable at such time from an
unaffiliated party; provided that (A) with respect to Affiliate
Transactions involving aggregate payments in excess of $1
million and less than $5 million, the Company or such
Subsidiary, as the case may be, shall have delivered an
Officers' Certificate to the Trustee certifying that such
transaction or series of transactions complies with clause (y)
above (other than the requirements set forth in such clause (y)
that such Affiliate Transaction be in the ordinary course of
business), (B) with respect to Affiliate Transactions involving
aggregate payments in excess of $5 million and less than $15
million, the Company or such Subsidiary, as the case may be,
shall have delivered an Officers' Certificate to the Trustee
certifying that such Affiliate Transaction complies with clause
(y) above (other than the requirements set forth in such clause
(y) that such Affiliate Transaction be in the ordinary course
of business) and that such Affiliate Transaction has received
the approval of a majority of the disinterested members of the
Board of Directors of the Company or the Subsidiary, as the
case may be, or in the absence of any such approval by the
disinterested members of the Board of Directors of the Company
or the Subsidiary, as the case may be, that an Independent
Financial Advisor has reasonably and in good faith determined
that the financial terms of such Affiliate Transaction are fair
to the Company or such Subsidiary, as the case may be, or that
the terms of such Affiliate Transaction are at least as
favorable as might reasonably have been obtained at such time
from an unaffiliated party and that such Independent Financial
Advisor has provided written confirmation of such determination
to the Board of Directors and (C) with respect to Affiliate
Transactions involving aggregate payments in excess of $15
million, the Company or such Subsidiary, as the case may be,
shall have delivered to the Trustee a written opinion from an
59
Independent Financial Advisor to the effect that the financial
terms of such Affiliate Transaction are fair to the Company or
such Subsidiary, as the case may be, or that the terms of such
Affiliate Transaction are at least as favorable as those that
might reasonably have been obtained at the time from an
unaffiliated party.
(b) The provisions of Section 4.11(a) shall not
apply to (i) any Permitted Payment, (ii) any Restricted Payment
that is made in compliance with the provisions of Section 4.03,
(iii) reasonable and customary fees and compensation paid to,
and indemnity provided on behalf of, officers, directors,
employees or consultants of the Company or any Subsidiary, as
determined by the Board of Directors of the Company or any
Subsidiary or the senior management thereof in good faith,
(iv) transactions exclusively between or among the Company and
any of its wholly-owned Subsidiaries or exclusively between or
among such wholly-owned Subsidiaries, provided such
transactions are not otherwise prohibited by this Indenture,
(v) any agreement as in effect as of the Issue Date or any
amendment thereto or any transaction contemplated thereby
(including pursuant to any amendment thereto) so long as any
such amendment is not disadvantageous to the Securityholders in
any material respect, (vi) the existence of, or the performance
by the Company or any of its Subsidiaries of its obligations
under the terms of, any stockholder agreement (including any
registration rights agreement or purchase agreement related
thereto) to which it (or New Holdings) is a party as of the
Issue Date and any similar agreements which it (or New
Holdings) may enter into thereafter; provided, however, that
the existence of, or the performance by the Company or any
Subsidiaries of obligations under any future amendment to, any
such existing agreement or under any similar agreement entered
into after the Issue Date shall only be permitted by this
clause (vi) to the extent that the terms of any such amendment
or new agreement are not otherwise disadvantageous to the
Securityholders in any material respect, (vii) transactions
permitted by, and complying with, the provisions of
Section 5.01 and (viii) transactions with suppliers or other
purchases or sales of goods or services, in each case in the
ordinary course of business (including, without limitation,
pursuant to joint venture agreements) and otherwise in
compliance with the terms of this Indenture which are fair to
the Company, in the reasonable determination of the Board of
Directors of the Company or the senior management thereof, or
are on terms at least as favorable as might reasonably have
been obtained at such time from an unaffiliated party.
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SECTION 4.12. Limitation on Incurrences of
Additional Indebtedness.
The Company shall not, and shall not permit any of
its Subsidiaries, directly or indirectly, to incur, assume,
guarantee, become liable, contingently or otherwise, with
respect to, or otherwise become responsible for the payment of
(collectively "incur") any Indebtedness other than Permitted
Indebtedness; provided, however, that if no Default with
respect to payment of principal of, or interest on, the
Securities or Event of Default under this Indenture shall have
occurred and be continuing at the time of or as a consequence
of the incurrence of any such Indebtedness, the Company may
incur Indebtedness if immediately before and immediately after
giving effect to the incurrence of such Indebtedness the
Operating Coverage Ratio of the Company would be greater than
2.0 to 1.0; provided further a Subsidiary may incur Acquired
Indebtedness to the extent such Indebtedness could have been
incurred by the Company pursuant to the immediately preceding
proviso.
In addition, neither the Company nor any Subsidiary
Guarantor will, directly or indirectly, in any event incur any
Indebtedness that by its terms (or by the terms of any
agreement governing such Indebtedness) is subordinated to any
other Indebtedness of the Company or such Subsidiary Guarantor,
as the case may be, unless such Indebtedness is also by its
terms (or by the terms of any agreement governing such
Indebtedness) made expressly subordinate to the Securities or
the Guarantee of such Subsidiary Guarantor, as the case may be,
to the same extent and in the same manner as such Indebtedness
is subordinated pursuant to subordination provisions that are
most favorable to the holders of any other Indebtedness of the
Company or such Subsidiary Guarantor, as the case may be.
SECTION 4.13. Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries._____
The Company shall not, and shall not permit any
Subsidiary to, directly or indirectly, create or suffer to
exist, or allow to become effective any consensual Payment
Restriction with respect to any of its Subsidiaries, except for
(a) any such restrictions contained in (i) the Credit Agreement
in effect on the Issue Date, as any such Payment Restriction
may apply to any present or future Subsidiary, (ii) this
Indenture and any agreement in effect at or entered into on the
Issue Date, (iii) Indebtedness of a person existing at the time
such person becomes a Subsidiary (provided that (x) such
Indebtedness is not incurred in connection with, or in
contemplation of, such person becoming a Subsidiary, (y) such
61
restriction is not applicable to any person, or the properties
or assets of any person, other than the person so acquired and
(z) such Indebtedness is otherwise permitted to be incurred
pursuant to Section 4.12), (iv) secured Indebtedness otherwise
permitted to be incurred pursuant to Sections 4.12 and 4.14
that limit the right of the debtor to dispose of the assets
securing such Indebtedness; (b) customary non-assignment
provisions restricting subletting or assignment of any lease or
other agreement entered into by a Subsidiary; (c) customary net
worth provisions contained in leases and other agreements
entered into by a Subsidiary in the ordinary course of
business; (d) customary restrictions with respect to a
Subsidiary pursuant to an agreement that has been entered into
for the sale or disposition of all or substantially all of the
Capital Stock or assets of such Subsidiary; (e) customary
provisions in joint venture agreements and other similar
agreements; (f) restrictions contained in Indebtedness incurred
to refinance, refund, extend or renew Indebtedness referred to
in clause (a) above; provided that the restrictions contained
therein are not materially more restrictive taken as a whole
than those provided for in such Indebtedness being refinanced,
refunded, extended or renewed and (g) Payment Restrictions
contained in any other Indebtedness permitted to be incurred
subsequent to the Issue Date pursuant to the provisions of
Section 4.12; provided that any such Payment Restrictions are
ordinary and customary with respect to the type of Indebtedness
being incurred (under the relevant circumstances) and, in any
event, no more restrictive than the most restrictive Payment
Restrictions in effect on the Issue Date.
SECTION 4.14. Limitation on Liens.
The Company shall not and shall not permit any
Subsidiary to create, incur, assume or suffer to exist any
Liens upon any of their respective assets unless the Securities
are equally and ratably secured by the Liens covering such
assets, except for (i) existing and future Liens securing
Indebtedness and other obligations of the Company and its
Subsidiaries under the Credit Agreement and related documents
or any refinancing or replacement thereof in whole or in part
permitted under this Indenture, (ii) Permitted Liens,
(iii) Liens securing Acquired Indebtedness, provided that such
Liens (x) are not incurred in connection with, or in
contemplation of, the acquisition of the property or assets
acquired and (y) do not extend to or cover any property or
assets of the Company or any Subsidiary other than the property
or assets so acquired, (iv) Liens to secure Capitalized Lease
Obligations and certain other Indebtedness that is otherwise
permitted under this Indenture, provided that (A) any such Lien
is created solely for the purpose of securing such other
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Indebtedness representing, or incurred to finance, refinance or
refund, the cost (including sales and excise taxes,
installation and delivery charges and other direct costs of,
and other direct expenses paid or charged in connection
therewith) of the purchase (whether through stock or asset
purchase, merger or otherwise) or construction or improvement
of the property subject thereto (whether real or personal,
including fixtures and other equipment), (B) the principal
amount of the Indebtedness secured by such Lien does not exceed
100% of such costs and (C) such Lien does not extend to or
cover any other property other than such item of property and
any improvements on such item, (v) Liens existing on the Issue
Date (after giving effect to the Merger), (vi) Liens in favor
of the Trustee under this Indenture and any substantially
equivalent Lien granted to any trustee or similar institution
under any indenture for Indebtedness permitted to be incurred
under this Indenture, and (vii) any replacement, extension or
renewal, in whole or in part, of any Lien described in this or
the foregoing clauses including in connection with any
refinancing of the Indebtedness, in whole or in part, secured
by any such Lien; provided that to the extent any such clause
limits the amount secured or the assets subject to such Liens,
no replacement, extension or renewal shall increase the amount
or the assets subject to such Liens, except to the extent that
the Liens associated with such additional assets are otherwise
permitted hereunder.
SECTION 4.15. Limitation on Change of Control.
(a) Upon the occurrence of a Change of Control, each
Holder shall have the right to require the repurchase of such
Holder's Securities pursuant to the offer described in
paragraph (b), below (the "Change of Control Offer"), at a
purchase price equal to 101% of the principal amount thereof
plus accrued and unpaid interest to the date of repurchase.
The Company shall purchase all Securities tendered
into a Change of Control Offer before it shall redeem or
otherwise purchase any Subordinated Indebtedness which the
Company is required to redeem or purchase in connection with a
Change of Control.
(b) Within 30 days following the date upon which the
Change of Control occurred (the "Change of Control Date"), the
Company must send, by first class mail, a notice to each Holder
of Securities, with a copy to the Trustee, which notice shall
govern the terms of the Change of Control Offer. The notice to
the Holders shall contain all instructions and materials
necessary to enable such Holders to tender Securities pursuant
to the Change of Control Offer. The Company shall give notice
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of an event giving rise to a Change of Control on the same date
and in the same manner to all Holders of Securities. Such
notice shall state:
(1) that the Change of Control Offer is being made
pursuant to this Section 4.15 and that all Securities
tendered will be accepted for payment;
(2) the purchase price (including the amount of
accrued interest) and the purchase date (which shall be no
earlier than 30 days nor later than 40 days from the date
such notice is mailed, other than as may be required by
law) (the "Change of Control Payment Date"); provided,
however, that the Change of Control Payment Date for the
Securities shall be one Business Day prior to the Change
of Control Payment Date with respect to the Change of
Control Payment Date under the Senior Subordinated Note
Indentures with respect to such Change of Control;
(3) that any Security not tendered will continue to
accrue interest if interest is then accruing;
(4) that, unless the Company defaults in making
payment therefor, any Security accepted for payment
pursuant to the Change of Control Offer shall cease to
accrue interest after the Change of Control Payment Date;
(5) that Holders electing to have a Security
purchased pursuant to a Change of Control Offer will be
required to surrender the Security, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the
Security completed, to the Paying Agent at the address
specified in the notice prior to the close of business on
the Business Day prior to the Change of Control Payment
Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than two
Business Days prior to the Change of Control Payment Date,
a telegram, telex, facsimile transmission or letter
setting forth the name of the Holder, the principal amount
of the Securities the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to
have such Security purchased;
(7) that Holders whose Securities are purchased only
in part will be issued new Securities equal in principal
amount to the unpurchased portions of the Securities
surrendered; provided that each Security purchased and
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each Security issued shall be in an original principal
amount of $1,000 or integral multiples thereof;
(8) that each Change of Control Offer is required to
remain open for at least 20 Business Days or such longer
period as may be required by law and until 12:00 Midnight
New York City time on the applicable Change of Control
Payment Date; and
(9) the circumstances and relevant facts regarding
such Change of Control.
On or before the Change of Control Payment Date, the
Company shall (i) accept for payment Securities or portions
thereof tendered pursuant to the Change of Control Offer,
(ii) deposit with the Paying Agent U.S. Legal Tender sufficient
to pay the purchase price of all Securities so tendered and
(iii) deliver to the Trustee Securities so accepted together
with an Officers' Certificate stating the Securities or
portions thereof being purchased by the Company. The Paying
Agent shall promptly mail to the Holders of Securities so
accepted payment in an amount equal to the purchase price (and
the Trustee shall promptly authenticate and mail to such
Holders new Securities equal in principal amount to any
unpurchased portion of the Securities surrendered provided that
each such new Security shall be in the principal amount of
$1,000 or integral multiples thereof). The Company will
publicly announce the results of the Change of Control Offer on
or as soon as practicable after the Change of Control Payment
Date. For purposes of this Section 4.15, the Trustee shall act
as the Paying Agent.
The Company shall comply with the requirements of
Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and
regulations are applicable in connection with the repurchase of
Securities pursuant to a Change of Control Offer. To the
extent the provisions of any securities laws or regulations
conflict with the provisions under this Section 4.15, the
Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its
obligations under this Section 4.15 by virtue thereof.
SECTION 4.16. Limitation on Asset Sales.
Neither the Company nor any of its Subsidiaries shall
consummate an Asset Sale unless (a) the Company or the
applicable Subsidiary receives consideration at the time of
such Asset Sale at least equal to the fair market value of the
assets sold and (b) upon consummation of an Asset Sale, the
65
Company will within 365 days of the receipt of the proceeds
therefrom, either: (i) apply or cause its Subsidiary to apply
the Net Cash Proceeds of any Asset Sale to (A) a Related
Business Investment, (B) an investment in properties and assets
that replace the properties and assets that are the subject of
such Asset Sale or (C) an investment in properties and assets
that will be used in the business of the Company and its
Subsidiaries existing on the Issue Date or in a business
reasonably related thereto; (ii) in the case of a sale of a
store or stores, deem such Net Cash Proceeds to have been
applied to the extent of any capital expenditures made to
acquire or construct a replacement store in the general
vicinity of the store sold within 365 days preceding the date
of the Asset Sale; (iii) apply or cause to be applied such Net
Cash Proceeds to the permanent repayment of Pari Passu
Indebtedness; provided, however, that the repayment of any
revolving loan (under the Credit Agreement or otherwise) shall
result in a permanent reduction in the commitment thereunder;
(iv) use such Net Cash Proceeds to secure Letter of Credit
Obligations to the extent related letters of credit have not
been drawn upon or returned undrawn; or (v) after such time as
the accumulated Net Cash Proceeds equal or exceed $20 million,
apply or cause to be applied such Net Cash Proceeds to the
purchase of Securities tendered to the Company for purchase at
a price equal to 100% of the principal amount thereof plus
accrued interest thereon to the date of purchase pursuant to an
offer to purchase made by the Company as set forth below (a
"Net Proceeds Offer"); provided, however, that the Company
shall have the right to exclude from the foregoing provisions
Asset Sales subsequent to the Issue Date, the proceeds of which
are derived from the sale and substantially concurrent lease-
back of a supermarket and/or related assets or equipment which
are acquired or constructed by the Company or a Subsidiary
subsequent to the date that is six months prior to the Issue
Date, provided that such sale and substantially concurrent
lease-back occurs within 270 days following such acquisition or
the completion of such construction, as the case may be.
Pending the utilization of any Net Cash Proceeds in the manner
(and within the time period) described above, the Company may
use any such Net Cash Proceeds to repay revolving loans (under
the Credit Agreement or otherwise) without a permanent
reduction of the commitment thereunder.
Notice of a Net Proceeds Offer pursuant to this
Section 4.16 will be mailed to record Holders of Securities as
shown on the register of Holders not less than 325 days nor
more than 365 days after the relevant Asset Sale, with a copy
to the Trustee. The notice shall contain all instructions and
materials necessary to enable such Holders to tender Securities
66
pursuant to the Net Proceeds Offer and shall state the
following terms:
(1) that the Net Proceeds Offer is being made
pursuant to Section 4.16 and that all Securities tendered
will be accepted for payment, provided, however, that if
the aggregate principal amount of Securities tendered in a
Net Proceeds Offer plus accrued interest at the expiration
of such offer exceeds the aggregate amount of the Net
Proceeds Offer, the Company shall select the Securities to
be purchased on a pro rata basis (based on amounts
tendered) (with such adjustments as may be deemed
appropriate by the Company so that only Securities in
denominations of $1,000 or multiples thereof shall be
purchased);
(2) the purchase price (including the amount of
accrued interest) and the purchase date (which shall be no
earlier than 30 days nor later than 40 days from the date
such notice is mailed, other than as may be required by
law) (the "Proceeds Purchase Date");
(3) that any Security not tendered will continue to
accrue interest if interest is then accruing;
(4) that, unless the Company defaults in making
payment therefor, any Security accepted for payment
pursuant to the Net Proceeds Offer shall cease to accrue
interest after the Proceeds Purchase Date;
(5) that Holders electing to have a Security
purchased pursuant to a Net Proceeds Offer will be
required to surrender the Security, with the form entitled
"Option of Holder to Elect Purchase" on the reverse of the
Security completed, to the Paying Agent at the address
specified in the notice prior to the close of business on
the Business Day prior to the Proceeds Purchase Date;
(6) that Holders will be entitled to withdraw their
election if the Paying Agent receives, not later than two
Business Days prior to the Proceeds Purchase Date, a
telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of the
Securities the Holder delivered for purchase and a
statement that such Holder is withdrawing his election to
have such Security purchased;
(7) that Holders whose Securities were purchased
only in part will be issued new Securities equal in
principal amount to the unpurchased portion of the
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Securities surrendered; provided that each Security
purchased and each new Security issued shall be in an
original principal amount of $1,000 or integral multiples
thereof; and
(8) that the Net Proceeds Offer shall remain open
for a period of 20 Business Days or such longer period as
may be required by law.
On or before the Proceeds Purchase Date, the Company
shall (i) accept for payment Securities or portions thereof
tendered pursuant to the Net Proceeds Offer which are to be
purchased in accordance with item (b)(1) above, (ii) deposit
with the Paying Agent U.S. Legal Tender sufficient to pay the
purchase price of all Securities to be purchased and (iii)
deliver to the Trustee Securities so accepted together with an
Officers' Certificate stating the Securities or portions
thereof being purchased by the Company. The Paying Agent shall
promptly mail to the Holders of Securities so accepted payment
in an amount equal to the purchase price (and the Trustee shall
promptly authenticate and mail or deliver to such Holders a new
Security equal in principal amount to any unpurchased portion
of the Security surrendered provided that each such new
Security shall be in the principal amount of $1,000 or integral
multiples thereof). The Company will publicly announce the
results of the Net Proceeds Offer on or as soon as practicable
after the Proceeds Purchase Date. For purposes of this Section
4.16, the Trustee shall act as the Paying Agent.
Any amounts remaining after the purchase of
Securities pursuant to a Net Proceeds Offer shall be returned
by the Trustee to the Company.
The Company shall comply with the requirements of
Rule 14e-1 under the Exchange Act and any other securities laws
and regulations thereunder to the extent such laws and
regulations are applicable in connection with the purchase of
Securities pursuant to a Net Proceeds Offer. To the extent the
provisions of any securities laws or regulations conflict with
the provisions under this Section 4.16, the Company shall
comply with the applicable securities laws and regulations and
shall not be deemed to have breached its obligations under this
Section 4.16 by virtue thereof.
SECTION 4.17. Guarantees of Certain Indebtedness.
The Company will not permit any of its Subsidiaries
to (a) incur, guarantee or secure through the granting of Liens
the payment of any Indebtedness under the term portion of the
Credit Agreement or refinancings thereof or (b) pledge any
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intercompany notes representing obligations of any of its
Subsidiaries, to secure the payment of any Indebtedness under
the term portion of the Credit Agreement or refinancings
thereof, in each case unless such Subsidiary, the Company and
the Trustee execute and deliver a supplemental indenture
evidencing such Subsidiary's Guarantee.
SECTION 4.18. Limitation on Preferred Stock of Subsidiaries.
The Company will not permit any of its Subsidiaries
to issue any Preferred Stock (other than to the Company or to a
wholly-owned Subsidiary) or permit any person (other than the
Company or a wholly-owned Subsidiary) to own any Preferred
Stock of any Subsidiary.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. Limitations on Mergers and Certain Other
Transactions.
(a) The Company shall not in a single transaction or
through a series of related transactions, (i) consolidate with
or merge with or into any other person, or transfer (by lease,
assignment, sale or otherwise) all or substantially all of its
properties and assets as an entirety or substantially as an
entirety to another person or group of affiliated persons or
(ii) adopt a Plan of Liquidation, unless, in either case:
(1) either the Company shall be the continuing
person, or the person (if other than the Company) formed
by such consolidation or into which the Company is merged
or to which all or substantially all of the properties and
assets of the Company as an entirety or substantially as
an entirety are transferred (or, in the case of a Plan of
Liquidation, any person to which assets are transferred)
(the Company or such other person being hereinafter
referred to as the "Surviving Person") shall be a
corporation organized and validly existing under the laws
of the United States, any State thereof or the District of
Columbia, and shall expressly assume, by an indenture
supplement, all the obligations of the Company under the
Securities and this Indenture;
(2) immediately after and giving effect to such
transaction and the assumption contemplated by clause
(1) above and the incurrence or anticipated incurrence of
69
any Indebtedness to be incurred in connection therewith,
(A) the Surviving Person shall have a Consolidated Net
Worth equal to or greater than the Consolidated Net Worth
of the Company immediately preceding the transaction and
(B) the Surviving Person could incur at least $1 of
additional Indebtedness (other than Permitted
Indebtedness) pursuant to Section 4.12;
(3) immediately before and immediately after and
giving effect to such transaction and the assumption of
the obligations as set forth in clause (1) above and the
incurrence or anticipated incurrence of any Indebtedness
to be incurred in connection therewith, no Default or
Event of Default shall have occurred and be continuing;
and
(4) each Subsidiary Guarantor, unless it is the
other party to the transaction, shall have by supplemental
indenture confirmed that its Guarantee of the obligations
of the Company under the Securities and this Indenture
shall apply, without alteration or amendment as such
Guarantee applies on the date it was granted under this
Indenture to the obligations of the Company under this
Indenture and the Securities to the obligations of the
Company or such Person as the case may be, under this
Indenture and the Securities, after consummation of such
transaction.
(b) Notwithstanding the foregoing, the consummation
of the Merger on the Issue Date need only comply with clauses
(1) and (3) of the foregoing paragraph.
(c) For purposes of the foregoing, the transfer (by
lease, assignment, sale or otherwise, in a single transaction
or series of transactions) of all or substantially all of the
properties and assets of one or more direct or indirect
Subsidiaries, the Capital Stock of which constitutes all or
substantially all of the properties and assets of the Company
shall be deemed to be the transfer of all or substantially all
of the properties and assets of the Company.
SECTION 5.02 Successor Corporation Substituted.
Upon any consolidation or merger, or any transfer of
all or substantially all of the assets of the Company or any
adoption of a Plan of Liquidation by the Company in accordance
with Section 5.01, the Surviving Person formed by such
consolidation or into which the Company is merged or to which
such transfer is made (or in the case of a Plan of Liquidation,
70
to which assets are transferred) shall succeed to, and be
substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such
Surviving Person had been named as the Company herein;
provided, however, that solely for purposes of computing
amounts described in subclause (c) of the first paragraph of
Section 4.03, any such Surviving Person shall only be deemed to
have succeeded to and be substituted for the Company with
respect to periods subsequent to the effective time of such
merger, consolidation or transfer of assets. When a successor
corporation assumes all of the obligations of the Company
hereunder and under the Securities and agrees to be bound
hereby and thereby, the predecessor shall be released from such
obligations.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs if:
(i) the Company defaults in the payment of interest
on any Securities when the same becomes due and payable
and the Default continues for a period of 30 days;
(ii) the Company defaults in the payment of the
principal of, or premium, if any, on the Securities when
due whether at maturity, upon acceleration, redemption,
required repurchase or otherwise;
(iii) the Company fails to comply with any of its
agreements contained in the Securities or this Indenture
(other than a default specified in clause (i) or (ii)
above), if such failure continues for the period and after
the notice specified below;
(iv) there shall be a default under any Indebtedness
of the Company or any of its Subsidiaries, whether such
Indebtedness now exists or shall hereafter be created, if
both (A) such default either (1) results from the failure
to pay any such Indebtedness at its stated final maturity
or (2) relates to an obligation other than the obligation
to pay such Indebtedness at its stated final maturity and
results in the holder or holders of such Indebtedness
causing such Indebtedness to become due prior to its
stated final maturity and (B) the principal amount of such
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Indebtedness, together with the principal amount of any
other such Indebtedness in default for failure to pay
principal at stated final maturity or the maturity of
which has been so accelerated, aggregates $20 million or
more at any one time outstanding;
(v) one or more judgments, orders or decrees of any
court or regulatory or administrative agency of competent
jurisdiction for the payment of money in excess of $20
million, either individually or in the aggregate, shall be
entered against the Company or any Subsidiary of the
Company or any of their respective properties and shall
not be discharged and there shall have been a period of 60
days after the date on which any period for appeal has
expired and during which a stay of enforcement of such
judgment, order or decree shall not be in effect;
(vi) either the Company or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case or proceeding; (b) consents
to the entry of a Bankruptcy Order for relief against it
in an involuntary case or proceeding or the commencement
of any case or proceeding against it; (c) consents to the
appointment of a custodian of it or for substantially all
of its property; or (d) makes a general assignment for the
benefit of its creditors;
(vii) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that: (a) is for
relief against the Company or any Significant Subsidiary,
in an involuntary case or proceeding; (b) appoints a
custodian of the Company or any Significant Subsidiary, or
for all or any substantial part of their respective
properties; or (c) orders the liquidation of the Company
or any Significant Subsidiary and in each case the order
or decree remains unstayed and in effect for 60 days;
(viii) the lenders under the Credit Agreement shall
commence judicial proceedings to foreclose upon any
material portion of the assets of the Company and its
Subsidiaries or shall have exercised any right under
applicable law or applicable security documents to take
ownership of any such assets in lieu of foreclosure; or
(ix) any of the Guarantees shall be declared or
adjudged invalid in a final judgment or order issued by
any court or governmental authority.
A Default under clause (iii) above (other than in the
case of any Default under Section 4.03, 4.15, 4.16 or 5.01,
72
which Defaults shall be Events of Default with the notice
specified in this paragraph but without the passage of time
specified in this paragraph) is not an Event of Default until
the Trustee notifies the Company, or the Holders of at least
25% in principal amount of the outstanding Securities notify
the Company and the Trustee of the Default, and the Company
does not cure the Default within 30 days after receipt of the
notice. The notice must specify the Default, demand that it be
remedied and state that the notice is a "Notice of Default."
Such notice shall be given by the Trustee if so requested by
the Holders of at least 25% in principal amount of the
Securities then outstanding. When a Default is cured, it
ceases.
SECTION 6.02. Acceleration.
(a) If an Event of Default (other than an Event of
Default specified in Section 6.01(vi) or (vii) with respect to
the Company or a Subsidiary Guarantor) occurs and is
continuing, the Trustee or the Holders of at least 25% in
principal amount of the then outstanding Securities may, and
the Trustee upon the request of the Holders of not less than
25% in aggregate principal amount of the then outstanding
Securities shall, declare due and payable all unpaid principal
and interest accrued and unpaid on the then outstanding
Securities by written notice to the Company (and, if any
Indebtedness is outstanding under the Credit Agreement or the
Credit Agreement is otherwise in effect, to the Credit Agent)
and the Trustee specifying the respective Event of Default and
that it is a "notice of acceleration" (the "Acceleration
Notice"), and the same (i) shall become immediately due and
payable or (ii) if there are any amounts outstanding under the
Credit Agreement, shall become due and payable upon the first
to occur of an acceleration under the Credit Agreement, or five
business days after receipt by the Company and the Credit Agent
of such Acceleration Notice. If an Event of Default specified
in Section 6.01(vi) or (vii) occurs with respect to the Company
or a Subsidiary Guarantor that is a Significant Subsidiary, all
unpaid principal of and accrued interest on all then
outstanding Securities shall be immediately due and payable
without any declaration or other act on the part of the Trustee
or any of the Holders. Upon payment of such principal amount,
interest, and premium, if any, all of the Company's obligations
under the Securities and this Indenture, other than obligations
under Section 7.07, shall terminate. After a declaration of
acceleration, the Holders of a majority in principal amount of
the Securities then outstanding, by notice to the Trustee, may
rescind an acceleration and its consequences if (i) all
existing Events of Default, other than the non-payment of the
principal of the Securities which has become due solely by such
73
declaration of acceleration, have been cured or waived, (ii) to
the extent the payment of such interest is lawful, interest on
overdue installments of interest and overdue principal, which
has become due otherwise than by such declaration of
acceleration, has been paid, (iii) the rescission would not
conflict with any judgment or decree of a court of competent
jurisdiction and (iv) the Company has paid or deposited with
the Trustee a sum sufficient to pay all sums paid or advanced
by the Trustee under this Indenture and the compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel.
(b) In the event of a declaration of acceleration
under this Indenture because an Event of Default set forth in
Section 6.01(iv) has occurred and is continuing, such
declaration of acceleration shall be automatically rescinded
and annulled if either (i) the holders of the Indebtedness
which is the subject of such Event of Default have waived such
failure to pay at maturity or have rescinded the acceleration
in respect of such Indebtedness within 90 days of such maturity
or declaration of acceleration, as the case may be, and no
other Event of Default has occurred during such 90-day period
which has not been cured or waived, or (ii) such Indebtedness
shall have been discharged or the maturity thereof shall have
been extended such that it is not then due and payable, or the
underlying default has been cured (and any acceleration based
thereon of such other Indebtedness has been rescinded), within
90 days of such maturity or declaration of acceleration, as the
case may be.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of or interest on
the Securities or to enforce the performance of any provision
of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does
not possess any of the Securities or does not produce any of
them in the proceeding. A delay or omission by the Trustee or
any Securityholder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy
or constitute a waiver of or acquiescence in the Event of
Default. No remedy is exclusive of any other remedy. All
available remedies are cumulative to the extent permitted by
law.
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SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 6.07 and 9.02, the Holders of a
majority in principal amount of the outstanding Securities by
notice to the Trustee may waive an existing Default or Event of
Default and its consequences, except a Default in the payment
of principal of or interest on any Security as specified in
clauses (i) and (ii) of Section 6.01. When a Default or Event
of Default is waived, it is cured and ceases.
SECTION 6.05. Control by Majority.
Subject to Section 2.09, the Holders of a majority in
principal amount of the outstanding Securities may direct the
time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or
power conferred on it, including, without limitation, any
remedies provided for in Section 6.03. Subject to
Section 7.01, however, the Trustee may refuse to follow any
direction that conflicts with any law or this Indenture, that
the Trustee determines may be unduly prejudicial to the rights
of another Securityholder, or that may involve the Trustee in
personal liability; provided that the Trustee may take any
other action deemed proper by the Trustee which is not
inconsistent with such direction.
SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with
respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice
of a continuing Event of Default;
(2) the Holder or Holders of at least 25% in
principal amount of the outstanding Securities make a
written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
indemnity satisfactory to the Trustee against any loss,
liability or expense to be incurred in compliance with
such request;
(4) the Trustee does not comply with the request
within 60 days after receipt of the request and the offer
of indemnity; and
(5) during such 60-day period the Holder or Holders
of a majority in principal amount of the outstanding
Securities do not give the Trustee a direction which, in
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the opinion of the Trustee, is inconsistent with the
request.
A Securityholder may not use this Indenture to
prejudice the rights of another Securityholder or to obtain a
preference or priority over such other Securityholder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this
Indenture, the right of any Holder to receive payment of
principal of and interest on a Security, on or after the
respective due dates expressed in such Security, or to bring
suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the
consent of the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of principal or
interest specified in clause (i) or (ii) of Section 6.01 occurs
and is continuing, the Trustee may recover judgment in its own
name and as trustee of an express trust against the Company or
any other obligor on the Securities for the whole amount of
principal and accrued interest remaining unpaid, together with
interest on overdue principal and, to the extent that payment
of such interest is lawful, interest on overdue installments of
interest, in each case at the rate per annum borne by the
Securities and such further amount as shall be sufficient to
cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other
papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel) and the Securityholders
allowed in any judicial proceedings relating to the Company or
any other obligor upon the Securities, any of their respective
creditors or any of their respective property and shall be
entitled and empowered to collect and receive any monies or
other property payable or deliverable on any such claims and to
distribute the same, and any Custodian in any such judicial
proceedings is hereby authorized by each Securityholder to make
such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the
Securityholders, to pay to the Trustee any amount due to it for
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the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agent and counsel, and any other
amounts due the Trustee under Section 7.07. Nothing herein
contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Security
holder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any
Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Securityholder in any such proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money pursuant to this
Article Six, it shall pay out the money in the following order:
First: to the Trustee for amounts due under
Section 7.07;
Second: to Holders for interest accrued on the
Securities, ratably, without preference or priority of any
kind, according to the amounts due and payable on the
Securities for interest;
Third: to Holders for principal amounts due and
unpaid on the Securities, ratably, without preference or
priority of any kind, according to the amounts due and
payable on the Securities for principal; and
Fourth: to the Company or the Subsidiary Guarantors,
as their respective interests may appear.
The Trustee, upon prior notice to the Company, may
fix a record date and payment date for any payment to
Securityholders pursuant to this Section 6.10.
SECTION 6.11. Rights and Remedies Cumulative.
No right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or
hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
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SECTION 6.12. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder
of any Security to exercise any right or remedy accruing upon
any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this
Article Six or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 6.13. Undertaking for Costs.
In any suit for the enforcement of any right or
remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in
its discretion may require the filing by any party litigant in
the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees, against any party
litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant.
This Section 6.13 does not apply to a suit by the Trustee, a
suit by a Holder pursuant to Section 6.07, or a suit by a
Holder or Holders of more than 10% in principal amount of the
outstanding Securities.
ARTICLE SEVEN
TRUSTEE
The Trustee hereby accepts the trust imposed upon it
by this Indenture and covenants and agrees to perform the same,
as herein expressed.
SECTION 7.01. Duties of Trustee.
(a) If a Default or an Event of Default of which the
Trustee is aware has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by
this Indenture and use the same degree of care and skill in its
exercise thereof as a prudent person would exercise or use
under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of a Default or an
Event of Default:
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(1) The Trustee need undertake to perform only those
duties as are specifically set forth in this Indenture and
no covenants or obligations shall be implied in this
Indenture against the Trustee.
(2) In the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this
Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Trustee shall have no liability except for
its own negligent action, its own negligent failure to act, or
its own willful misconduct, except that:
(1) This paragraph does not limit the effect of
paragraph (b) of this Section 7.01.
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it
is proved that the Trustee was negligent in ascertaining
the pertinent facts.
(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.
(d) No provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers if
it shall have reasonable grounds for believing that repayment
of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(e) Every provision of this Indenture that in any
way relates to the Trustee is subject to paragraphs (a), (b),
(c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on
any assets received by it. Assets held in trust by the Trustee
need not be segregated from other assets except to the extent
required by law.
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SECTION 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely on and shall be protected
in acting or refraining from acting upon any document
believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting,
it may consult with counsel and may require in addition to
written direction from the Company an Officers'
Certificate or an Opinion of Counsel, which shall conform
to Sections 11.04 and 11.05. The Trustee shall not be
liable for any action it takes or omits to take in good
faith in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and
agents and shall not be responsible for the misconduct or
negligence of any attorney or agent appointed with due
care.
(d) The Trustee shall not be liable for any action
that it takes or omits to take in good faith which it
believes to be authorized or within its rights or powers.
(e) The Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in
its discretion, may make such further inquiry or
investigation into such facts or matters as it may see
fit.
(f) The Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request, order or direction of any of the
Holders pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or
thereby.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity
may become the owner or pledgee of Securities and may otherwise
deal with the Company, its Subsidiaries, or their respective
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Affiliates with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights. However,
the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the
validity or adequacy of this Indenture or the Securities, it
shall not be accountable for the Company's use of the proceeds
from the Securities, and it shall not be responsible for any
statement in the Securities other than the Trustee's
certificate of authentication.
SECTION 7.05. Notice of Default.
If a Default or an Event of Default occurs and is
continuing and if it is known to the Trustee, the Trustee shall
mail to each Holder of Securities notice of the Default or
Event of Default within 90 days after such Default or Event of
Default occurs or if such Default or Event of Default is known
to the Trustee during such 90-day period, promptly after such
Default or Event of Default becomes known to the Trustee;
provided, however, that, except in the case of a Default or
Event of Default in the payment of the principal of or interest
on any Security, including the failure to make payment on a
Change of Control Payment Date pursuant to a Change of Control
Offer or payment when due pursuant to a Net Proceeds Offer the
Trustee may withhold such notice if it in good faith determines
that withholding such notice is in the interest of the Holders.
SECTION 7.06. Reports by Trustee to Holders.
Within 60 days after each May 15 beginning with the
May 15 following the date of this Indenture, the Trustee shall,
to the extent that any of the events described in TIA { 313(a)
occurred within the previous twelve months, but not otherwise,
mail to each Securityholder a brief report dated as of such
May 15 that complies with TIA { 313(a). The Trustee also shall
comply with TIA {{ 313(b) and 313(c).
A copy of each report at the time of its mailing to
Securityholders shall be mailed to the Company and filed with
the Commission and each stock exchange, if any, on which the
Securities are listed.
The Company shall notify the Trustee if the
Securities become 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 services. The Trustee's
compensation shall not be limited by any law on compensation of
a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it. Such expenses shall
include the reasonable compensation, disbursements and expenses
of the Trustee's agents and counsel.
The Company shall indemnify the Trustee for, and hold
it harmless against, any loss or liability incurred by it
except for such actions to the extent caused by any negligence
or bad faith on its part, arising out of or in connection with
the administration of this trust and its rights or duties
hereunder. The Trustee shall notify the Company promptly of
any claim asserted against the Trustee for which it may seek
indemnity. 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; provided that the Company will not be
required to pay such fees and expenses if it assumes the
Trustee's defense and there is no conflict of interest between
the Company and the Trustee in connection with such defense as
reasonably determined by the Trustee. The Company need not pay
for any settlement made without its written consent. The
Company need not reimburse any expense or indemnify against any
loss or liability to the extent incurred by the Trustee through
its negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this
Section 7.07, the Trustee shall have a lien prior to the
Securities on all assets held or collected by the Trustee, in
its capacity as Trustee, except assets held in trust to pay
principal of or interest on particular Securities.
When the Trustee incurs expenses or renders services
after an Event of Default specified in Section 6.01(vi) or
(vii) occurs, the expenses and the compensation for the
services are intended to constitute expenses of administration
under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee.
The Trustee may resign by so notifying the Company.
The Holders of a majority in principal amount of the
outstanding Securities may remove the Trustee and appoint a
successor trustee with the Company's consent, by so notifying
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the Company and the Trustee. The Company may remove the
Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an
insolvent;
(3) a receiver or other public officer takes charge
of the Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Company
shall notify each Holder of such event and shall promptly
appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in
principal amount of the Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the
Company.
A successor Trustee shall deliver a written
acceptance of its appointment to the retiring Trustee and to
the Company. Immediately after that, the retiring Trustee
shall transfer all property held by it as Trustee to the
successor Trustee, subject to the lien provided in
Section 7.07, the resignation or removal of the retiring
Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under
this Indenture. A successor Trustee shall mail notice of its
succession to each Securityholder.
If a successor Trustee does not take office within 60
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 outstanding Securities may petition any
court of competent jurisdiction for the appointment of a
successor Trustee.
If the Trustee fails to comply with Section 7.10, any
Securityholder may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a
successor Trustee.
Notwithstanding replacement of the Trustee pursuant
to this Section 7.08, the Company's obligations under
Section 7.07 shall continue for the benefit of the retiring
Trustee.
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SECTION 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts
into, or transfers all or substantially all of its corporate
trust business to, another corporation, the resulting,
surviving or transferee corporation without any further act
shall, if such resulting, surviving or transferee corporation
is otherwise eligible hereunder, be the successor Trustee.
SECTION 7.10. Eligibility; Disqualification.
This Indenture shall always have a Trustee who
satisfies the requirement of TIA {{ 310(a)(1) and 310(a)(5).
The Trustee shall have a combined capital and surplus of at
least $100,000,000 as set forth in its most recent published
annual report of condition. The Trustee shall comply with TIA
{ 310(b); provided, however, that there shall be excluded from
the operation of TIA { 310(b)(1) any indenture or indentures
under which other securities, or certificates of interest or
participation in other securities, of the Company are
outstanding, if the requirements for such exclusion set forth
in TIA { 310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against
Company._________________________________
The Trustee shall comply with TIA { 311(a), excluding
any creditor relationship listed in TIA { 311(b). A Trustee
who has resigned or been removed shall be subject to TIA
{ 311(a) to the extent indicated.
ARTICLE EIGHT
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01. Termination of the Company's
Obligations.________________
The Company may terminate its obligations under the
Securities and this Indenture, and the obligations of any
Subsidiary Guarantor shall terminate, except those obligations
referred to in the penultimate paragraph of this Section 8.01,
if all Securities previously authenticated and delivered (other
than destroyed, lost or stolen Securities which have been
replaced or paid or Securities for whose payment money has
theretofore been deposited with the Trustee or the Paying Agent
in trust or segregated and held in trust by the Company and
thereafter repaid to the Company, as provided in Section 8.04)
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have been delivered to the Trustee for cancellation and the
Company has paid all sums payable by it hereunder, or if:
(1) either (i) pursuant to Article Three, the
Company shall have given notice to the Trustee and mailed
a notice of redemption to each Holder of the redemption of
all of the Securities under arrangements satisfactory to
the Trustee for the giving of such notice or (ii) all
Securities have otherwise become due and payable
hereunder;
(2) the Company shall have irrevocably deposited or
caused to be deposited with the Trustee or a trustee
satisfactory to the Trustee, under the terms of an
irrevocable trust agreement in form and substance
satisfactory to the Trustee, as trust funds in trust
solely for the benefit of the Holders for that purpose,
money in such amount as is sufficient without
consideration of reinvestment of such interest, to pay
principal of, premium, if any, and interest on the
outstanding Securities to maturity or redemption; provided
that the Trustee shall have been irrevocably instructed to
apply such money to the payment of said principal,
premium, if any, and interest with respect to the
Securities;
(3) no Default or Event of Default with respect to
this Indenture or the Securities shall have occurred and
be continuing on the date of such deposit or shall occur
as a result of such deposit and such deposit will not
result in a breach or violation of, or constitute a
default under, any other instrument to which the Company
is a party or by which it is bound;
(4) the Company shall have paid all other sums
payable by it hereunder; and
(5) the Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent providing for the
termination of the Company's and any Subsidiary
Guarantor's obligation under the Securities and this
Indenture have been complied with. Such Opinion of
Counsel shall also state that such satisfaction and
discharge does not result in a default under the Credit
Agreement (if then in effect) or any other agreement or
instrument then known to such counsel that binds or
affects the Company.
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Notwithstanding the foregoing paragraph, the
Company's obligations in Sections 2.05, 2.06, 2.07, 2.08, 4.01,
4.02 and 7.07 and any Subsidiary Guarantor's obligations in
respect thereof shall survive until the Securities are no
longer outstanding pursuant to the last paragraph of
Section 2.08. After the Securities are no longer outstanding,
the Company's obligations in Sections 7.07, 8.04 and 8.05 and
any Subsidiary Guarantor's obligations in respect thereof shall
survive.
After such delivery or irrevocable deposit the
Trustee upon request shall acknowledge in writing the discharge
of the Company's and any Subsidiary Guarantor's obligations
under the Securities and this Indenture except for those
surviving obligations specified above.
SECTION 8.02. Legal Defeasance and Covenant
Defeasance.__________________
(a) The Company may, at its option by Board
Resolution of the Board of Directors of the Company, at any
time, with respect to the Securities, elect to have either
paragraph (b) or paragraph (c) below be applied to the
outstanding Securities upon compliance with the conditions set
forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a)
of the option applicable to this paragraph (b), the Company and
any Subsidiary Guarantor shall be deemed to have been released
and discharged from its obligations with respect to the
outstanding Securities on the date the conditions set forth
below are satisfied (hereinafter, "legal defeasance"). For
this purpose, such legal defeasance means that the Company
shall be deemed to have paid and discharged the entire
indebtedness represented by the outstanding Securities, which
shall thereafter be deemed to be "outstanding" only for the
purposes of paragraph (e) below and the other Sections of and
matters under this Indenture referred to in (i) and (ii) below,
and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are
concerned (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same) except
for the following which shall survive until otherwise
terminated or discharged hereunder: (i) the rights of Holders
of outstanding Securities to receive solely from the funds held
by the Trustee in the trust fund described in paragraph (d)
below and as more fully set forth in such paragraph, payments
in respect of the principal of, premium, if any, and interest
on such Securities when such payments are due, (ii) the
Company's obligations with respect to such Securities under
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Sections 2.06, 2.07 and 4.02, and, with respect to the Trustee,
under Section 7.07 and any Subsidiary Guarantor's obligations
in respect thereof, (iii) the rights, powers, trusts, duties
and immunities of the Trustee hereunder and (iv) this
Section 8.02 and Section 8.05. Subject to compliance with this
Section 8.02, the Company may exercise its option under this
paragraph (b) notwithstanding the prior exercise of its option
under paragraph (c) below with respect to the Securities.
(c) Upon the Company's exercise under paragraph (a)
of the option applicable to this paragraph (c), the Company
shall be released and discharged from its obligations under any
covenant contained in Article five and in Sections 4.03, 4.05
through 4.09 and 4.11 through 4.18 with respect to the
outstanding Securities on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"),
and the Securities shall thereafter be deemed to be not
"outstanding" for the purpose 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.
For this purpose, such covenant defeasance means that, with
respect to the outstanding Securities, the Company and any
Subsidiary Guarantor 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(iii), but, except as specified above, the
remainder of this Indenture and such Securities shall be
unaffected thereby.
(d) The following shall be the conditions to
application of either paragraph (b) or paragraph (c) above to
the outstanding Securities:
(i) the Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another
trustee satisfying the requirements of Section 7.10 who
shall agree to comply with the provisions of this
Section 8.02 applicable to it) as trust funds in trust for
the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the
benefit of the Holders of such Securities, (x) money in an
amount or (y) direct non-callable obligations of, or non-
callable obligations guaranteed by, the United States of
America for the payment of which guarantee or obligation
the full faith and credit of the United States is pledged
87
("U.S. Government Obligations") maturing as to principal,
premium, if any, and interest in such amounts of money and
at such times as are sufficient without consideration of
any reinvestment of such interest, to pay principal of and
interest on the outstanding Securities not later than one
day before the due date of any payment, or (z) a
combination thereof, sufficient, in the opinion of a
nationally recognized firm of independent public
accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge and which
shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge principal of, premium, if
any, and interest on the outstanding Securities on the
Maturity Date or otherwise in accordance with the terms of
this Indenture and of such Securities; provided, however,
that the Trustee (or other qualifying trustee) shall have
received an irrevocable written order from the Company
instructing the Trustee (or other qualifying trustee) to
apply such money or the proceeds of such U.S. Government
Obligations to said payments with respect to the
Securities;
(ii) no Default or Event of Default or event which
with notice or lapse of time or both would become a
Default or an Event of Default with respect to the
Securities shall have occurred and be continuing on the
date of such deposit or, insofar as Section 6.01(vi) or
(vii) is concerned, at any time during the period ending
on the 91st day after the date of such deposit (it being
understood that this condition shall not be deemed
satisfied until the expiration of such period);
(iii) such legal defeasance or covenant defeasance
shall not cause the Trustee to have a conflicting interest
with respect to any Securities of the Company or any
Subsidiary Guarantor;
(iv) such legal defeasance or covenant defeasance
shall not result in a breach or violation of, or
constitute a Default or Event of Default under, this
Indenture or any other material agreement or instrument to
which the Company or any Subsidiary Guarantor is a party
or by which it is bound (and in that connection, the
Trustee shall have received a certificate from the Credit
Agent to that effect with respect to such Credit Agreement
if then in effect);
(v) in the case of an election under paragraph (b)
above, the Company shall have delivered to the Trustee an
Opinion of Counsel stating that (x) the Company has
88
received from, or there has been published by, the
Internal Revenue Service a ruling or (y) since the Issue
Date, there has been a change in the applicable Federal
income tax law, in either case to the effect that, and
based thereon such opinion shall confirm that, the Holders
of the outstanding Securities 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;
(vi) in the case of an election under paragraph (c)
above, the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that the Holders of the
outstanding Securities will not recognize income, gain or
loss for Federal income tax purposes as a result of such
covenant defeasance and will be subject to Federal income
tax on the same amounts, in the same manner and at the
same times as would have been the case if such covenant
defeasance had not occurred;
(vii) in the case of an election under either
paragraph (b) or (c) above, an Opinion of Counsel to the
effect that, after the 91st day following the deposit, the
trust funds will not be subject to the effect of any
applicable Bankruptcy Law;
(viii) the Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for
relating to either the legal defeasance under
paragraph (b) above or the covenant defeasance under
paragraph (c) above, as the case may be, have been
complied with; and
(ix) the Company shall have delivered to the Trustee
an Officer's Certificate stating that the deposit was not
made by the Company with the intent of preferring the
Holders of the Securities over other creditors of the
Company or any Subsidiary Guarantor or with the intent of
defeating, hindering, delaying or defrauding creditors of
the Company, any Subsidiary Guarantor or others.
(e) All money and U.S. Government Obligations
(including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this
paragraph (e), the "Trustee") pursuant to paragraph (d) above
in respect of the outstanding Securities shall be held in trust
and applied by the Trustee, in accordance with the provisions
89
of such Securities and this Indenture, to the payment, either
directly or through any Paying Agent (other than the Company or
any Affiliate of the Company), to the Holders of such
Securities of all sums due and to become due thereon in respect
of principal, premium and interest, 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 U.S. Government Obligations deposited pursuant to
paragraph (d) above or the principal, premium, if any, and
interest received in respect thereof other than any such tax,
fee or other charge which by law is for the account of the
Holders of the outstanding Securities. The Company's
obligations to pay and indemnify the Trustee as set forth in
this paragraph shall survive the termination of this Indenture
and the Securities.
Anything in this Section 8.02 to the contrary
notwithstanding, the Trustee shall deliver or pay to the
Company from time to time upon the request, in writing, by the
Company any money or U.S. Government Obligations held by it as
provided in paragraph (d) above which, in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent legal
defeasance or covenant defeasance.
SECTION 8.03. Application of Trust Money.
The Trustee shall hold in trust money or U.S.
Government Obligations deposited with it pursuant to Sections
8.01 and 8.02, and shall apply the deposited money and the
money from U.S. Government Obligations in accordance with this
Indenture to the payment of principal of, premium, if any, and
interest on the Securities.
SECTION 8.04. Repayment to Company or Subsidiary
Guarantors._______________________
Subject to Sections 7.07, 8.01 and 8.02, the Trustee
shall promptly pay to the Company, or if deposited with the
Trustee by any Subsidiary Guarantor, to such Guarantor, upon
receipt by the Trustee of an Officers' Certificate, any excess
money, determined in accordance with Section 8.02, held by it
at any time. The Trustee and the Paying Agent shall pay to the
Company or any Subsidiary Guarantor, as the case may be, upon
receipt by the Trustee or the Paying Agent, as the case may be,
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of an Officers' Certificate, any money held by it for the
payment of principal, premium, if any, or interest that remains
unclaimed for two years after payment to the Holders is
required; provided, however, that the Trustee and the Paying
Agent before being required to make any payment may, but need
not, at the expense of the Company cause to be published once
in a newspaper of general circulation in The City of New York
or mail to each Holder entitled to such money notice that such
money remains unclaimed and that after a date specified
therein, which shall be at least 30 days from the date of such
publication or mailing, any unclaimed balance of such money
then remaining will be repaid to the Company. After payment to
the Company or any Subsidiary Guarantor, as the case may be,
Securityholders entitled to money must look solely to the
Company for payment as general creditors unless an applicable
abandoned property law designates another person, and all
liability of the Trustee or Paying Agent with respect to such
money shall thereupon cease.
SECTION 8.05. Reinstatement.
If the Trustee or Paying Agent is unable to apply any
money or U.S. Government Obligations in accordance with this
Indenture by reason of any legal proceeding or by reason of any
order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such
application, then and only then the Company's and each
Subsidiary Guarantor's, if any, obligations under this
Indenture and the Securities shall be revived and reinstated as
though no deposit had been made pursuant to this Indenture
until such time as the Trustee is permitted to apply all such
money or U.S. Government Obligations in accordance with this
Indenture; provided, however, that if the Company or the
Subsidiary Guarantors, as the case may be, has made any payment
of principal of, premium, if any, or interest on any Securities
because of the reinstatement of its obligations, the Company or
the Subsidiary Guarantors, as the case may be, shall be,
subrogated to the rights of the holders of such Securities to
receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
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ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Company and the Subsidiary Guarantors, when
authorized by a Board Resolution, and the Trustee, together,
may amend or supplement this Indenture or the Securities
without notice to or consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
provided that such amendment or supplement does not
adversely affect the rights of any Holder;
(2) to comply with Article Five and Section 10.05;
(3) to provide for uncertificated Securities in
addition to or in place of certificated Securities;
(4) to make any other change that does not adversely
affect the rights of any Securityholder in any material
respect; or
(5) to comply with any requirements of the
Commission in connection with the qualification of this
Indenture under the TIA;
provided that the Company has delivered to the Trustee an
Opinion of Counsel stating that such amendment or supplement
complies with the provisions of this Section 9.01.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Company and each
Subsidiary Guarantor, when authorized by a Board Resolution,
and the Trustee, together with the written consent of the
Holder or Holders of at least a majority in aggregate principal
amount of the outstanding Securities, may amend or supplement,
or waive compliance with any provision of, this Indenture, the
Securities or any Guarantee without notice to any other
Securityholders; provided that without the consent of Holders
of not less than two thirds in aggregate principal amount of
Securities then outstanding, no such amendment, supplement or
waiver may release any Subsidiary Guarantor from any of its
obligations under its Guarantee or this Indenture other than in
accordance with the terms of such Guarantee and this Indenture;
provided, further, that without the consent of Holders of not
less than 75% in aggregate principal amount of the Securities
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then outstanding, no such amendment, supplement or waiver may
change the Change of Control Payment Date or the purchase price
in connection with any repurchase of Securities pursuant to
Section 5.15 in a manner adverse to any Holder or waive a
Default or Event of Default resulting from a failure to comply
with Section 4.15. Without the consent of each Securityholder
affected, however, no amendment, supplement or waiver,
including a waiver pursuant to Section 6.04, may:
(1) change the principal amount of Securities whose
Holders must consent to an amendment, supplement or waiver
of any provision of this Indenture, the Securities or the
Guarantees;
(2) reduce the rate or extend the time for payment
of interest on any Security;
(3) reduce the principal amount of any Security;
(4) change the Maturity Date of any Security or
alter the redemption provisions in this Indenture or the
Securities in a manner adverse to any Holder;
(5) make any changes in the provisions concerning
waivers of Defaults or Events of Default by Holders of the
Securities or the rights of Holders to recover the
principal of, interest on, or redemption payment with
respect to, any Security;
(6) make any changes in Section 6.04, 6.07 or this
Section 9.02; or
(7) make the principal of, or the interest on any
Security payable with anything or in any manner other than
as provided for in this Indenture, the Securities and the
Guarantees as in effect on the date hereof.
It shall not be necessary for the consent of the
Holders under this Section to approve the particular form of
any proposed amendment, supplement or waiver, but it shall be
sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this
Section becomes effective, the Company shall mail to the
Holders affected thereby 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 supplemental
indenture.
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In connection with any amendment, supplement or
waiver under this Article Nine, the Company may, but shall not
be obligated to, offer to any Holder who consents to such
amendment, supplement or waiver, or to all Holders,
consideration for such Holder's consent to such amendment,
supplement or waiver.
SECTION 9.03. Compliance with TIA.
From the date on which the Indenture is qualified
under the TIA, every amendment, waiver or supplement of this
Indenture or the Securities shall comply with the TIA as then
in effect.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes
effective, a consent to it by a Holder is a continuing consent
by the Holder and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent
is not made on any Security. However, any such Holder or
subsequent Holder may revoke the consent as to his Security or
portion of his Security by notice to the Trustee or the Company
received before the date on which the Trustee receives an
Officers' Certificate certifying that the Holders of the
requisite principal amount of Securities have consented (and
not theretofore revoked such consent) to the amendment,
supplement or waiver.
The Company may, but shall not be obligated to, fix a
record date for the purpose of determining the Holders entitled
to consent to any amendment, supplement or waiver, which record
date shall be at least 30 days prior to the first solicitation
of such consent. If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding
paragraph, those persons who were Holders at such record date
(or their duly designated proxies), and only those persons,
shall be entitled to revoke any consent previously given,
whether or not such persons continue to be Holders after such
record date. No such consent shall be valid or effective for
more than 90 days after such record date.
After an amendment, supplement or waiver becomes
effective, it shall bind every Securityholder, unless it makes
a change described in any of clauses (1) through (7) of Section
9.02, in which case, the amendment, supplement or waiver shall
bind only each Holder of a Security who has consented to it and
every subsequent Holder of a Security or portion of a Security
that evidences the same debt as the consenting Holder's
94
Security; provided that any such waiver shall not impair or
affect the right of any Holder to receive payment of principal
of and interest on a Security, on or after the respective due
dates expressed in such Security, or to bring suit for the
enforcement of any such payment on or after such respective
dates without the consent of such Holder.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the
terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place
an appropriate notation on the Security about the changed terms
and return it to the Holder. Alternatively, if the Company or
the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new
Security that reflects the changed terms.
SECTION 9.06. Trustee To Sign Amendments, Etc.
The Trustee shall execute any amendment, supplement
or waiver authorized pursuant to this Article Nine; provided
that the Trustee may, but shall not be obligated to, execute
any such amendment, supplement or waiver which affects the
Trustee's own rights, duties or immunities under this
Indenture. The Trustee shall be entitled to receive, and shall
be fully protected in relying upon, an Opinion of Counsel
stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article Nine is authorized
or permitted by this Indenture.
ARTICLE TEN
GUARANTEE
SECTION 10.01. Unconditional Guarantee.
Each Subsidiary Guarantor hereby unconditionally,
jointly and severally, guarantees (such guarantee to be
referred to herein as the "Guarantee") to each Holder of a
Security authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, the Securities or the
obligations of the Company hereunder or thereunder, that: (i)
the principal of and interest on the Securities will be
promptly paid in full when due, subject to any applicable grace
period, whether at maturity, by acceleration or otherwise and
interest on the overdue principal, if any, and interest on any
interest, to the extent lawful, of the Securities and all other
95
obligations of the Company to the Holders or the Trustee
hereunder or thereunder will be promptly paid in full or
performed, all in accordance with the terms hereof and thereof;
and (ii) in case of any extension of time of payment or renewal
of any Securities or of any such other obligations, the same
will be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, subject
to any applicable grace period, whether at stated maturity, by
acceleration or otherwise, subject, however, in the case of
clauses (i) and (ii) above, to the limitations set forth in
Section 10.04. Each Subsidiary Guarantor hereby agrees that
its obligations hereunder shall be unconditional, irrespective
of the validity, regularity or enforceability of the Securities
or this Indenture, the absence of any action to enforce the
same, any waiver or consent by any Holder of the Securities
with respect to any provisions hereof or thereof, the recovery
of any judgment against the Company, any action to enforce the
same or any other circumstance which might otherwise constitute
a legal or equitable discharge or defense of a guarantor. Each
Subsidiary Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event
of insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest, notice
and all demands whatsoever and covenants that this Guarantee
will not be discharged except by complete performance of the
obligations contained in the Securities, this Indenture and in
this Guarantee. If any Securityholder or the Trustee is
required by any court or otherwise to return to the Company,
any Subsidiary Guarantor, or any custodian, trustee, liquidator
or other similar official acting in relation to the Company or
any Subsidiary Guarantor, any amount paid by the Company or any
Subsidiary Guarantor to the Trustee or such Securityholder,
this Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. Each Subsidiary Guarantor
further agrees that, as between each Subsidiary Guarantor, 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 Article Six for the purposes of
this 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
acceleration of such obligations as provided in Article Six,
such obligations (whether or not due and payable) shall
forthwith become due and payable by each Subsidiary Guarantor
for the purpose of this Guarantee.
SECTION 10.02. Severability.
In case any provision of this Guarantee shall be
invalid, illegal or unenforceable, the validity, legality, and
96
enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.
SECTION 10.03. Release of a Subsidiary Guarantor.
Upon (i) the release by the lenders under the Term
Loans, related documents and future refinancings thereof of all
guarantees of a Subsidiary Guarantor and all Liens on the
property and assets of such Subsidiary Guarantor relating to
such Indebtedness, or (ii) the sale or disposition (whether by
merger, stock purchase, asset sale or otherwise) of a
Subsidiary Guarantor (or all or substantially all its assets)
to an entity which is not a Subsidiary of the Company and which
sale or disposition is otherwise in compliance with the terms
of this Indenture, such Subsidiary Guarantor shall be deemed
released from all obligations under this Article Ten without
any further action required on the part of the Trustee or any
Holder; provided, however, that any such termination shall
occur only to the extent that all obligations of such
Subsidiary Guarantor under all of its guarantees of, and under
all of its pledges of assets or other security interests which
secure, such Indebtedness of the Company shall also terminate
upon such release, sale or transfer.
The Trustee shall deliver an appropriate instrument
evidencing such release upon receipt of a request by the
Company accompanied by an Officers' Certificate certifying as
to the compliance with this Section 10.03. Any Subsidiary
Guarantor not so released remains liable for the full amount of
principal of and interest on the Securities as provided in this
Article Ten.
SECTION 10.04. Limitation of Subsidiary Guarantor's Liability.
Each Subsidiary Guarantor and by its acceptance
hereof each Holder hereby confirms that it is the intention of
all such parties that the guarantee by such Subsidiary
Guarantor pursuant to its Guarantee not constitute a fraudulent
transfer or conveyance for purposes of the Bankruptcy Law, the
Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar Federal or state law. To
effectuate the foregoing intention, the Holders and such
Subsidiary Guarantor hereby irrevocably agree that the
obligations of such Subsidiary Guarantor under the Guarantee
shall be limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such
Subsidiary Guarantor and after giving effect to any collections
from or payments made by or on behalf of any other Subsidiary
Guarantor in respect of the obligations of such other
Subsidiary Guarantor under its Guarantee or pursuant to Section
97
11.06, result in the obligations of such Subsidiary Guarantor
under the Guarantee not constituting such fraudulent transfer
or conveyance.
SECTION 10.05. Subsidiary Guarantors May Consolidate,
etc., on Certain Terms.
(a) Nothing contained in this Indenture or in any of
the Securities 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. Upon any such consolidation, merger,
sale or conveyance, the Guarantee given by such Subsidiary
Guarantor shall no longer have any force or effect.
(b) Except as set forth in Article Four and Article
Five hereof, nothing contained in this Indenture or in any of
the Securities shall prevent any consolidation or merger of a
Subsidiary Guarantor with or into a corporation or corporations
other than the Company or another Subsidiary Guarantor (whether
or not affiliated with the Subsidiary Guarantor); provided,
however, that, subject to Sections 10.03 and 10.05(a), (i) such
transaction does not violate any covenants set forth in this
Indenture and immediately after such transaction, and giving
effect thereto, no Default or Event of Default shall have
occurred as a result of such transaction and be continuing, and
(ii) upon any such consolidation, merger, sale or conveyance,
the Subsidiary Guarantee set forth in this Article Ten, and the
due and punctual performance and observance of all of the
covenants and conditions of this Indenture to be performed by
such Subsidiary Guarantor, shall be expressly assumed (in the
event that the Subsidiary Guarantor is not the surviving
corporation in the merger), by supplemental indenture
satisfactory in form to the Trustee, executed and delivered to
the Trustee, by the corporation formed by such consolidation,
or into which the Subsidiary Guarantor shall have merged, or by
the corporation that shall have acquired such property. In the
case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by
supplemental indenture executed and delivered to the Trustee
and satisfactory in form to the Trustee of the due and punctual
performance of all of the covenants and conditions of this
Indenture to be performed by the Subsidiary Guarantor, such
successor corporation 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; provided, however, that
solely for purposes of computing amounts described in subclause
(c) of the first paragraph of Section 4.03, any such successor
98
corporation shall only be deemed to have succeeded to and be
substituted for any Subsidiary Guarantor with respect to
periods subsequent to the effective time of such merger,
consolidation or transfer of assets.
SECTION 10.06. Contribution.
In order to provide for just and equitable
contribution among the Subsidiary Guarantors, the Subsidiary
Guarantors agree, inter se, that in the event any payment or
distribution is made by any Subsidiary Guarantor (a "Funding
Guarantor") under the Guarantee, such Funding Guarantor shall
be entitled to a contribution from all other Subsidiary
Guarantors in a pro rata amount based on the Adjusted Net
Assets of each Subsidiary Guarantor (including the Funding
Guarantor) for all payments, damages and expenses incurred by
that Funding Guarantor in discharging the Company's obligations
with respect to the Securities or any other Subsidiary
Guarantor's obligations with respect to the Guarantee.
"Adjusted Net Assets" of such Subsidiary Guarantor at any date
shall mean the lesser of the amount by which (x) the fair value
of the property of such Subsidiary Guarantor exceeds the total
amount of liabilities, including, without limitation,
contingent liabilities (after giving effect to all other fixed
and contingent liabilities incurred or assumed on such date
(other than liabilities of such Subsidiary Guarantor under
Indebtedness which constitutes Subordinated Indebtedness with
respect to such Guarantee)), but excluding liabilities under
the Guarantee of such Subsidiary Guarantor at such date and (y)
the present fair salable value of the assets of such Subsidiary
Guarantor at such date exceeds the amount that will be required
to pay the probable liability of such Subsidiary Guarantor on
its debts (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date (other
than liabilities of such Subsidiary Guarantor under
Indebtedness which constitutes Subordinated Indebtedness with
respect to such Guarantee) and after giving effect to any
collection from any Subsidiary of such Subsidiary Guarantor in
respect of the obligations of such Subsidiary under the
Guarantee), excluding debt in respect of the Guarantee of such
Subsidiary Guarantor, as they become absolute and matured.
SECTION 10.07. Waiver of Subrogation.
Each Subsidiary Guarantor hereby irrevocably waives
any claim or other rights which it may now or hereafter acquire
against the Company that arise from the existence, payment,
performance or enforcement of such Subsidiary Guarantor's
obligations under the Guarantee and this Indenture, including,
without limitation, any right of subrogation, reimbursement,
99
exoneration, indemnification, and any right to participate in
any claim or remedy of any Holder of Securities against the
Company, whether or not such claim, remedy or right arises in
equity, or under contract, statute or common law, including,
without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or
by set-off or in any other manner, payment or security on
account of such claim or other rights. If any amount shall be
paid to any Subsidiary Guarantor in violation of the preceding
sentence and the Securities shall not have been paid in full,
such amount shall have been deemed to have been paid to such
Subsidiary Guarantor for the benefit of, and held in trust for
the benefit of, the Holders of the Securities, and shall
forthwith be paid to the Trustee for the benefit of such
Holders to be credited and applied upon the Securities, whether
matured or unmatured, in accordance with the terms of this
Indenture. Each Subsidiary Guarantor acknowledges that it will
receive direct and indirect benefits from the financing
arrangements contemplated by this Indenture and that the waiver
set forth in this Section 10.07 is knowingly made in
contemplation of such benefits.
SECTION 10.08. Execution of Guarantee.
To evidence their guarantee to the Securityholders
set forth in this Article Ten, the Subsidiary Guarantors hereby
agree to execute the Guarantee in substantially the form
included in Exhibit A, which shall be endorsed on each Security
ordered to be authenticated and delivered by the Trustee. Each
Subsidiary Guarantor hereby agrees that its Guarantee set forth
in this Article Ten shall remain in full force and effect
notwithstanding any failure to endorse on each Security a
notation of such Guarantee. Each such Guarantee shall be
signed on behalf of each Subsidiary Guarantor by two Officers,
or an Officer and an Assistant Secretary or one Officer shall
sign and one Officer or an Assistant Secretary (each of whom
shall, in each case, have been duly authorized by all requisite
corporate actions) shall attest to such Guarantee prior to the
authentication of the Security on which it is endorsed, and the
delivery of such Security by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery
of such Guarantee on behalf of such Subsidiary Guarantor. Such
signatures upon the Guarantee may be by manual or facsimile
signature of such officers and may be imprinted or otherwise
reproduced on the Guarantee, and in case any such officer who
shall have signed the Guarantee shall cease to be such officer
before the Security on which such Guarantee is endorsed shall
have been authenticated and delivered by the Trustee or
disposed of by the Company, such Security nevertheless may be
authenticated and delivered or disposed of as though the person
100
who signed the Guarantee had not ceased to be such officer of
the Subsidiary Guarantor.
SECTION 10.09. Waiver of Stay, Extension or Usury Laws.
Each Subsidiary Guarantor covenants (to the extent
that it may lawfully do so) that it will not at any time insist
upon, plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury
law or other law that would prohibit or forgive each such
Subsidiary Guarantor from performing its Guarantee as
contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the
performance of this Indenture; and (to the extent that it may
lawfully do so) each such Subsidiary Guarantor hereby expressly
waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had
been enacted.
ARTICLE ELEVEN
MISCELLANEOUS
SECTION 11.01. TIA Controls.
If any provision of this Indenture limits, qualifies,
or conflicts with the duties imposed by operation of Section
3.18(c) of the TIA, the imposed duties shall control.
SECTION 11.02. Notices.
Any notices or other communications required or
permitted hereunder shall be in writing, and shall be
sufficiently given if made by hand delivery, by telex, by
telecopier or registered or certified mail, postage prepaid,
return receipt requested, addressed as follows:
if to the Company or any Subsidiary Guarantor:
c/o The Yucaipa Companies
10000 Santa Monica Boulevard
Fifth Floor
Los Angeles, California 90067
Attention: Mark A. Resnik
101
if to the Trustee:
NorWest Bank Minnesota, National Association
Sixth and Marquette
Minneapolis, Minnesota 55479-0069
Attention: Corporate Trust Division
if to the Credit Agent:
Bankers Trust Company
130 Liberty Street, 14th Floor
New York, New York 10006
Attention: Mary Jo Jolly
with a copy to:
Bankers Trust Company
300 S. Grand Avenue, 41st Floor
Los Angeles, CA 90071
Attention: Eric S. Swanson
Each of the Company, the Trustee, the Subsidiary
Guarantors and the Credit Agent by written notice to each other
such person may designate additional or different addresses for
notices to such person. Any notice or communication to the
Company, the Trustee, the Subsidiary Guarantors and the Credit
Agent shall be deemed to have been given or made as of the date
so delivered if personally delivered; when answered back, if
telexed; when receipt is acknowledged, if telecopied; and five
(5) calendar days after mailing if sent by registered or
certified mail, postage prepaid (except that a notice of change
of address shall not be deemed to have been given until
actually received by the addressee).
Any notice or communication mailed to a Security-
holder shall be mailed to him by first class mail or other
equivalent means at his address as it appears on the
registration books of the Registrar and shall be sufficiently
given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a
Securityholder or any defect in it shall not affect its
sufficiency with respect to other Securityholders. If a notice
or communication is mailed in the manner provided above, it is
duly given, whether or not the addressee receives it.
SECTION 11.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA
{ 312(b) with other Securityholders with respect to their
102
rights under this Indenture or the Securities. The Company,
the Subsidiary Guarantors, the Trustee, the Registrar and any
other person shall have the protection of TIA { 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions
Precedent.______________________________
Upon any request or application by the Company to the
Trustee to take any action under this Indenture, the Company
shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the
opinion of the signers, all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with; and
(2) an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent
have been complied with.
SECTION 11.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to
compliance with a condition or covenant provided for in this
Indenture, other than the Officers' Certificate required by
Section 4.07, shall include:
(1) a statement that the person making such
certificate or opinion has read such covenant or
condition;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of such person,
he has made such examination or investigation as is
necessary to enable him to express an informed opinion as
to whether or not such convenant or condition has been
complied with; and
(4) a statement as to whether or not, in the opinion
of each such person, such condition or covenant has been
complied with; provided, however, that with respect to
matters of fact an Opinion of Counsel may rely on an
Officers' Certificate or certificates of public officials.
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SECTION 11.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules for action by
or at a meeting of Securityholders. The Paying Agent or
Registrar may make reasonable rules for its functions.
SECTION 11.07. Legal Holidays.
A "Legal Holiday" used with respect to a particular
place of payment is a Saturday, a Sunday or a day on which
banking institutions in New York, New York, Los Angeles,
California or at such place of payment are not required to be
open. If a payment date is a Legal Holiday at such place,
payment may be made at such place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for
the intervening period.
SECTION 11.08. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAW. Each of the parties hereto agrees to submit to the
jurisdiction of the courts of the State of New York in any
action or proceeding arising out of or relating to this
Indenture.
SECTION 11.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another
indenture, loan or debt agreement of any of the Company or any
of its Subsidiaries. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
SECTION 11.10. No Recourse Against Others.
A director, officer, employee, stockholder or
incorporator, as such, of the Company shall not have any
liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creations.
Each Securityholder by accepting a Security waives and releases
all such liability. Such waiver and release are part of the
consideration for the issuance of the Securities.
SECTION 11.11. Successors.
All agreements of the Company and each Subsidiary
Guarantor in this Indenture and the Securities shall bind their
104
respective successors. All agreements of the Trustee in this
Indenture shall bind its successor.
SECTION 11.12. Duplicate Originals.
All parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of
them together shall represent the same agreement.
SECTION 11.13. Severability.
In case any one or more of the provisions in this
Indenture or in the Securities shall be held invalid, illegal
or unenforceable, in any respect for any reason, the validity,
legality and enforceability of any such provision in every
other respect and of the remaining provisions shall not in any
way be affected or impaired thereby, it being intended that all
of the provisions hereof shall be enforceable to the full
extent permitted by law.
SECTION 11.14. No Violation.
Notwithstanding the provisions of this Indenture, in
no event shall any transaction, agreement, payment or other
event to be consummated, entered into or made in connection
with the Merger or any financing thereof be considered a
violation of any provision of this Indenture or constitute a
Change of Control hereunder.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed, and their respective
corporate seals to be hereunto affixed and attested, all as of
the date first written above.
FOOD 4 LESS SUPERMARKETS, INC.
By: /s/ Mark A. Resnik
------------------------
Name:
Title:
Attest: /s/ George G. Golleher
-----------------------
NORWEST BANK, MINNESOTA,
National Association,
as Trustee
By: /s/ Raymond S. Haverstock
-------------------------
Name: Raymond S. Haverstock
Title: Assistant Vice President
Attest: /s/ Raymond S. Haverstock
-------------------------
SUBSIDIARY GUARANTORS:
CALA CO.
CALA FOODS, INC.
BELL MARKETS, INC.
FOOD 4 LESS OF SOUTHERN
CALIFORNIA, INC.
ALPHA BETA COMPANY
FOOD 4 LESS OF CALIFORNIA, INC.
FALLEY'S, INC.
BAY AREA WAREHOUSE STORES, INC.
FOOD 4 LESS MERCHANDISING, INC.
FOOD 4 LESS GM, INC.
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By: /s/ Mark A. Resnik
---------------------
Name:
(for each of the above-
listed Subsidiary Guarantors)
Attest: /s/ George G. Golleher
---------------------------
(for each of the
above-listed
Subsidiary Guarantors)
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EXHIBIT A
[FORM OF NOTE]
FOOD 4 LESS SUPERMARKETS, INC.
10.45% Senior Note
due 2004
No. $
FOOD 4 LESS SUPERMARKETS, INC., a Delaware
corporation (the "Company", which term includes any successor
corporation), for value received promises to pay to
or registered assigns, the principal sum of Dollars, on
June 15, 2004.
Interest Payment Dates: June 15 and December 15
commencing on December 15, 1995.
Record Dates: June 1 and December 1.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if
set forth at this place.
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IN WITNESS WHEREOF, the Company has caused this
Security to be signed manually or by facsimile by its duly
authorized officers.
Dated:
FOOD 4 LESS SUPERMARKETS, INC.
By:
Name:
Title:
By:
Name:
Title:
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[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the Securities described in the
within-mentioned Indenture.
NORWEST BANK MINNESOTA,
National Association,
as Trustee
By
Authorized Signatory
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FOOD 4 LESS SUPERMARKETS, INC.
10.45% Senior Note
due 2004
1. Interest.
FOOD 4 LESS SUPERMARKETS, INC., a Delaware
corporation (the "Company"), promises to pay interest on the
principal amount of this Security at the rate per annum shown
above. The Company will pay interest semi-annually on each
June 15 and December 15 of each year (the "Interest Payment
Date"), commencing December 15, 1995, to the Holders of record
on the immediately preceding June 1 and December 1. Interest
on the Securities will accrue from the most recent date to
which interest has been paid or, if no interest has been paid,
from the date of issuance of the Securities. Interest will be
computed on the basis of a 360-day year comprised of twelve
30-day months.
The Company shall pay interest on overdue principal
and interest on overdue installments of interest, to the extent
lawful, at a rate equal to the rate of interest otherwise
payable on the Securities.
2. Method of Payment.
The Company shall pay interest on the Securities
(except defaulted interest) to the persons who are the
registered Holders at the close of business on the Record Date
immediately preceding the Interest Payment Date even if the
Securities are cancelled on registration of transfer or
registration of exchange after such Record Date. Holders must
surrender Securities to a Paying Agent to collect principal
payments. The Company shall pay principal and interest in
money of the United States that at the time of payment is legal
tender for payment of public and private debts ("U.S. Legal
Tender"). However, the Company may pay principal and interest
by wire transfer of Federal funds, or interest by its check
payable in such U.S. Legal Tender. The Company may deliver any
such interest payment to the Paying Agent or to a Holder at the
Holder's registered address. Notwithstanding the foregoing,
the Company shall pay or cause to be paid all amounts payable
with respect to non-DTC eligible Securities by wire transfer of
Federal funds to the account of the Holders of such Securities.
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3. Paying Agent and Registrar.
Initially, Norwest Bank Minnesota, National
Association (the "Trustee") will act as Paying Agent and
Registrar. The Company may change any Paying Agent, Registrar
or co-Registrar without notice to the Holders. The Company or
any of its Subsidiaries may, subject to certain exceptions, act
as Paying Agent, Registrar or co-Registrar.
4. Indenture and Guarantees.
The Company issued the Securities under an Indenture,
dated as of June 1, 1995 (the "Indenture"), among the Company,
the Subsidiary Guarantors and the Trustee. Capitalized terms
herein are used as defined in the Indenture unless otherwise
defined herein. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S. Code
{{ 77aaa-77bbbb) (the "TIA"), as in effect on the date of the
Indenture until such time as the Indenture is qualified under
the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. Notwithstanding anything
to the contrary herein, the Securities are subject to all such
terms, and Holders of Securities are referred to the Indenture
and said Act for a statement of them. The Securities are
general unsecured obligations of the Company limited in
aggregate principal amount to $525,000,000. Payment on each
Security is guaranteed on a senior basis, jointly and
severally, by the Subsidiary Guarantors pursuant to Article Ten
of the Indenture.
5. Optional Redemption.
On or after June 15, 2000 the Securities may be
redeemed in whole at any time or in part from time to time, at
the option of the Company, at a redemption price equal to the
applicable percentage of the principal amount thereof set forth
below, together with accrued and unpaid interest to the
Redemption Date, if redeemed during the 12 months commencing on
June 15 in the years set forth below:
Year Percentage
2000 ...................... 105.225%
2001 ...................... 103.483%
2002 ...................... 101.742%
2003 and thereafter ....... 100.000%
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In addition, on or prior to June 15, 1998, the
Company may, at its option, use the net cash proceeds of one or
more Public Equity Offerings to redeem up to an aggregate of
35% of the principal amount of the Securities originally
issued, at a redemption price equal to 110.450% of the
principal amount thereof if redeemed during the 12 months
commencing on June 15, 1995, 108.957% of the principal amount
thereof if redeemed during the 12 months commencing on June 15,
1996 and 107.464% of the principal amount thereof if redeemed
during the 12 months commencing on June 15, 1997, in each case
plus accrued and unpaid interest, if any, to the redemption
date.
6. Notice of Redemption.
Notice of redemption will be mailed at least 30 days
but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at such Holder's registered
address. In order to effect a redemption with the proceeds of
a Public Equity Offering, the Company shall send the redemption
notice not later than 60 days after the consummation of such
Public Equity Offering. Securities in denominations larger
than $1,000 may be redeemed in part.
Except as set forth in the Indenture, from and after
any Redemption Date, if monies for the redemption of the
Securities called for redemption shall have been deposited with
the Paying Agent for redemption on such Redemption Date, then,
unless the Company defaults in the payment of such Redemption
Price, the Securities called for redemption will cease to bear
interest and the only right of the Holders of such Securities
will be to receive payment of the Redemption Price.
7. Change of Control Offer.
Upon the occurrence of a Change of Control, each
Holder shall have the right to require the repurchase of such
Holder's Securities pursuant to a Change of Control Offer at a
purchase price equal to 101% of the principal amount thereof
plus accrued interest, if any, to the date of purchase.
8. Limitation on Asset Sales.
Under certain circumstances the Company is required
to apply the net proceeds from Asset Sales to the repayment of
Pari Passu Indebtedness, to make Related Business Investments,
an investment in properties and assets that replace the
properties and assets that are the subject of such Asset Sale,
an investment in properties and assets that will be used in the
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business of the Company and its Subsidiaries existing on the
Issue Date or in a business reasonably related thereto or to
purchase in a Net Proceeds Offer (at a price equal to 100% of
the aggregate principal amount thereof, plus accrued interest
to the date of purchase) such aggregate principal amount of
Securities which, when added to the accrued interest thereon,
shall be equal to the net proceeds required to be applied
thereto.
9. Denominations; Transfer; Exchange.
The Securities are in registered form, without
coupons, in denominations of $1,000 and integral multiples of
$1,000. A Holder shall register the transfer of or exchange
Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay certain transfer
taxes or similar governmental charges payable in connection
therewith as permitted by the Indenture. The Registrar need
not register the transfer of or exchange any Securities or
portions thereof selected for redemption.
10. Persons Deemed Owners.
The registered Holder of a Security shall be treated
as the owner of it for all purposes.
11. Unclaimed Money.
If money for the payment of principal or interest
remains unclaimed for two years, the Trustee and the Paying
Agents will pay the money back to the Company at its request.
After that, all liability of the Trustee and such Paying Agents
with respect to such money shall cease.
12. Discharge Prior to Redemption or Maturity.
If the Company at any time deposits with the Trustee
U.S. Legal Tender or U.S. Government Obligations sufficient to
pay the principal of and interest on the Securities to
redemption or maturity and complies with the other provisions
of the Indenture relating thereto, the Company will be
discharged from certain provisions of the Indenture and the
Securities (including the financial covenants, but excluding
its obligation to pay the principal of and interest on the
Securities).
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114
13. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture, the
Securities and the Guarantees may be amended or supplemented
with the written consent of the Holders of at least a majority
in aggregate principal amount of the Securities then
outstanding, and any existing Default or Event of Default or
compliance with any provision may be waived with the consent of
the Holders of a majority in aggregate principal amount of the
Securities then outstanding. Without notice to or consent of
any Holder, the parties thereto may amend or supplement the
Indenture or the Securities to, among other things, cure any
ambiguity, defect or inconsistency, provide for uncertificated
Securities in addition to or in place of certificated
Securities, comply with Article Five or Section 10.05 of the
Indenture, or comply with any requirements of the SEC in
connection with the qualification of the Indenture under the
TIA, or make any other change that does not adversely affect
the rights of any Holder of a Security.
14. Restrictive Covenants.
The Indenture imposes certain limitations on the
ability of the Company and its Subsidiaries to, among other
things, incur additional Indebtedness or Liens, make payments
in respect of its Capital Stock and merge or consolidate with
any other person and sell, lease, transfer or otherwise dispose
of substantially all of its properties or assets. The
limitations are subject to a number of important qualifications
and exceptions. The Company must annually report to the
Trustee on compliance with such limitations.
15. Successors.
When a successor assumes all the obligations of its
predecessor under the Securities and the Indenture, the
predecessor will be released from those obligations.
16. Defaults and Remedies.
If an Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in aggregate principal
amount of Securities then outstanding may declare all the
Securities to be due and payable immediately in the manner and
with the effect provided in the Indenture. Holders of
Securities may not enforce the Indenture or the Securities
except as provided in the Indenture. The Trustee may require
indemnity satisfactory to it before it enforces the Indenture
or the Securities. Subject to certain limitations, Holders of
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115
a majority in aggregate principal amount of the Securities then
outstanding may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of Securities
notice of any continuing Default or Event of Default (except a
Default in payment of principal or interest) if it determines
that withholding notice is in their interest.
17. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or
any other capacity, may become the owner or pledgee of
Securities and may otherwise deal with the Company, its
Subsidiaries or their respective Affiliates as if it were not
the Trustee.
18. No Recourse Against Others.
No stockholder, director, officer, employee or
incorporator, as such, of the Company shall have any liability
for any obligation of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason
of, such obligations or their creation. Each Holder of a
Security by accepting a Security waives and releases all such
liability. The waiver and release are part of the
consideration for the issuance of the Securities.
19. Authentication.
This Security shall not be valid until the Trustee or
authenticating agent manually signs the certificate of
authentication on this Security.
20. Abbreviations and Defined Terms.
Customary abbreviations may be used in the name of a
Holder of a Security or an assignee, such as: TEN COM (=
tenants in common), TEN ENT (= tenants by the entireties), JT
TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform
Gifts to Minors Act).
21. CUSIP Numbers.
Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the
Company will cause CUSIP numbers to be printed on the
Securities immediately prior to the qualification of the
Indenture under the TIA as a convenience to the Holders of the
Securities. No representation is made as to the accuracy of
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116
such numbers as printed on the Securities and reliance may be
placed only on the other identification numbers printed hereon.
The Company will furnish to any Holder of a Security
upon written request and without charge a copy of the
Indenture. Requests may be made to: Food 4 Less Supermarkets,
Inc., c/o The Yucaipa Companies, 10000 Santa Monica Boulevard,
Fifth Floor, Los Angeles, California 90067, Attn: Mark Resnik.
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[FORM OF NOTATION ON NOTE RELATING TO GUARANTEE]
GUARANTEE
The Subsidiary Guarantors (as defined in the
Indenture (the "Indenture") referred to in the Security upon
which this notation is endorsed and each hereinafter referred
to as a "Subsidiary Guarantor," which term includes any
successor person under the Indenture) have unconditionally
guaranteed on a senior unsecured basis (such guarantee by each
Subsidiary Guarantor being referred to herein as the
"Guarantee") (i) the due and punctual payment of the principal
of and interest on the Securities, whether at maturity, by
acceleration or otherwise, the due and punctual payment of
interest on the overdue principal and interest, if any, on the
Securities, to the extent lawful, and the due and punctual
performance of all other obligations of the Company to the
Holders or the Trustee all in accordance with the terms set
forth in Article Ten of the Indenture and (ii) in case of any
extension of time of payment or renewal of any Securities 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 each Subsidiary Guarantor to the
Holders of Securities and to the Trustee pursuant to the
Guarantee and the Indenture are expressly set forth and are
senior unsecured obligations of each such Subsidiary Guarantor,
to the extent and in the manner provided, in Article Ten of the
Indenture, and reference is hereby made to such Indenture for
the precise terms of the Guarantee therein made.
No stockholder, officer, director or incorporator, as
such, past, present or future, of any Subsidiary Guarantor
shall have any liability under the Guarantee by reason of his
or its status as such stockholder, officer, director or
incorporator.
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The Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the
Securities upon which the Guarantee is noted shall have been
executed by the Trustee under the Indenture by the manual
signature of one of its authorized officers.
SUBSIDIARY GUARANTORS:
CALA CO.
CALA FOODS, INC.
BELL MARKETS, INC.
FOOD 4 LESS OF SOUTHERN
CALIFORNIA, INC.
ALPHA BETA COMPANY
FOOD 4 LESS OF CALIFORNIA, INC.
FALLEY'S, INC.
FOOD 4 LESS MERCHANDISING, INC.
BAY AREA WAREHOUSE STORES, INC.
FOOD 4 LESS GM, INC.
By:
Name:
(for each of the above-listed
Subsidiary Guarantors)
By:
Name:
(for each of the above-listed
Subsidiary Guarantors)
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119
[FORM OF ASSIGNMENT]
To assign this Security fill in the form below:
I or we assign and transfer this Security to
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
(Print or type assignee's name, address and zip code)
Please insert Social Security or other
identifying number of assignee
_______________________________________
and irrevocably appoint _______________________ agent to
transfer this Security on the books of the Company. The agent
may substitute another to act for him.
Dated:_______________ Signature:____________________________
______________________________________________________________
(Sign exactly as your name appears on
the face of this Security)
Signature Guarantee:__________________________________________
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased
by the Company pursuant to Section 4.15 or Section 4.16 of the
Indenture, as the case may be, check the appropriate box below:
Section 4.15 [ ] Section 4.16 [ ]
If you want to elect to have only part of this
Security purchased by the Company pursuant to Section 4.15 or
Section 4.16 of the Indenture, as the case may be, state the
amount you want to be purchased:
$
Date:__________ Signature:____________________________
(Sign exactly as your name
appears on the face of
this Security)
Signature Guarantee:______________________________________
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