exhibit 4.2
SONIC AUTOMOTIVE, INC., as Issuer,
TOWN AND COUNTRY FORD INCORPORATED,
MARCUS DAVID CORPORATION,
FRONTIER OLDSMOBILE--CADILLAC, INC.,
SONIC DODGE, LLC,
SONIC CHRYSLER--PLYMOUTH--JEEP--EAGLE, LLC,
FORT MILL FORD, INC.,
TOWN AND COUNTRY CHRYSLER--PLYMOUTH--JEEP OF ROCK HILL, INC.,
FORT MILL CHRYSLER--PLYMOUTH--DODGE INC.,
LONE STAR FORD, INC.,
SONIC AUTOMOTIVE OF NEVADA, INC.,
SONIC AUTOMOTIVE OF TENNESSEE, INC.,
SONIC AUTOMOTIVE - 6025 INTERNATIONAL DRIVE, LLC,
SONIC AUTOMOTIVE OF NASHVILLE, LLC,
SONIC AUTOMOTIVE OF CHATTANOOGA, LLC,
TOWN AND COUNTRY JAGUAR, LLC,
TOWN AND COUNTRY CHRYSLER--PLYMOUTH--JEEP, LLC,
TOWN AND COUNTRY DODGE OF CHATTANOOGA, LLC,
SONIC AUTOMOTIVE - 2490 SOUTH LEE HIGHWAY, LLC,
TOWN AND COUNTRY FORD OF CLEVELAND, LLC,
FREEDOM FORD, INC.,
SONIC AUTOMOTIVE 5260 PEACHTREE INDUSTRIAL BLVD., LLC,
SONIC AUTOMOTIVE OF GEORGIA, INC.,
SONIC PEACHTREE INDUSTRIAL BLVD., L.P.,
SONIC AUTOMOTIVE - CLEARWATER, INC.,
SONIC AUTOMOTIVE 21699 U.S. HWY. 19 N., INC.,
SONIC AUTOMOTIVE COLLISION CENTER OF CLEARWATER, INC.,
SONIC AUTOMOTIVE - 1400 AUTOMALL DRIVE, COLUMBUS, INC.,
SONIC AUTOMOTIVE - 1455 AUTOMALL DRIVE, COLUMBUS, INC.
SONIC AUTOMOTIVE - 1495 AUTOMALL DRIVE, COLUMBUS, INC.
SONIC AUTOMOTIVE - 1500 AUTOMALL DRIVE, COLUMBUS, INC.
SONIC AUTOMOTIVE - 3700 WEST BROAD STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE - 4000 WEST BROAD STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE 2424 LAURENS RD., GREENVILLE, INC.,
SONIC AUTOMOTIVE 2752 LAURENS RD., GREENVILLE, INC.,
SONIC AUTOMOTIVE - 5585 PEACHTREE INDUSTRIAL BLVD., LLC,
CAPITOL CHEVROLET AND IMPORTS, INC.,
SONIC AUTOMOTIVE - 1919 N. DIXIE HWY., NSB, INC.,
SONIC AUTOMOTIVE - 1307 N. DIXIE HWY., NSB, INC.,
SONIC AUTOMOTIVE - 1720 MASON AVE., DB, INC.,
SONIC AUTOMOTIVE - 3741 S. NOVA RD., PO, INC.
SONIC AUTOMOTIVE -241 RIDGEWOOD AVE., HH, INC. and
SONIC AUTOMOTIVE - HWY. 153 at SHALLOWFORD ROAD, CHATTANOOGA, INC.
as Guarantors,
and
U.S. Bank Trust National Association, as Trustee
INDENTURE
Dated as of July 1, 1998
11% Senior Subordinated Notes due 2008
Reconciliation and tie between Trust Indenture Act of 1939, as amended,
and Indenture, dated as of July 1, 1998
Trust Indenture Indenture
Act Section Section
----------- -------
ss.310 (a)(1)...............................................609
(a)(2)...............................................609
(b)..................................................608, 610
ss.311 (a)..................................................613
ss.312 (a)..................................................701
(c)..................................................702
ss.313 (a)..................................................703
(c)..................................................703, 704
ss.314 (a)..................................................704
(a)(4)...............................................1018
(c)(1)...............................................103
(c)(2)...............................................103
(e)..................................................103
ss.315 (a)..................................................601(b)
(b)..................................................602
(c)..................................................601(a)
(d)..................................................601(c), 603
(e)..................................................514
ss.316 (a)(last sentence)...................................101 ("Outstanding")
(a)(1)(A)............................................502, 512
(a)(1)(B)............................................513
(b)..................................................508
(c)..................................................105
ss.317 (a)(1) 503
(a)(2) 504
(b)..................................................1003
ss.318 (a)..................................................108
Note: This reconciliation and tie shall not, for any purpose, be deemed to be a part
of this Indenture.
- 1 -
TABLE OF CONTENTS
-----------------
PAGE
----
PARTIES......................................................................1
RECITALS.....................................................................1
ARTICLE ONE DEFINITIONS AND OTHER
PROVISIONS OF GENERAL APPLICATION .................................2
Section 101. Definitions. ...................................................2
"Acquired Indebtedness"....................................3
"Affiliate"................................................3
"Applicable Procedures"....................................3
"Asset Sale"...............................................4
"Average Life to Stated Maturity"..........................4
"Bankruptcy Law"...........................................4
"Board of Directors".......................................5
"Board Resolution".........................................5
"Book-Entry Security"......................................5
"Business Day".............................................5
"Capital Lease Obligation".................................5
"Capital Stock"............................................5
"Cash Equivalents".........................................5
"Cedel"....................................................6
"Change of Control"........................................6
"Class A Common Stock".....................................7
"Code".....................................................7
"Commission"...............................................7
"Commodity Price Protection Agreement".....................7
"Company"..................................................8
"Company Request" or "Company Order".......................8
"Consolidated Fixed Charge Coverage Ratio".................8
"Consolidated Income Tax Expense"..........................9
"Consolidated Interest Expense"............................9
"Consolidated Net Income (Loss)"...........................9
"Consolidated Non-cash Charges"...........................10
"Consolidated Tangible Assets"............................10
"Consolidation"...........................................10
"Corporate Trust Office"..................................10
"Currency Hedging Agreements".............................11
"Default".................................................11
"Depositary"..............................................11
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PAGE
----
"Designated Senior Indebtedness"..........................10
"Disinterested Director"..................................10
"Euroclear"...............................................11
"Event of Default"........................................12
"Exchange Act"............................................12
"Exchange Offer"..........................................12
"Exchange Offer Registration Statement"...................12
"Fair Market Value".......................................12
"Floor Plan Facility".....................................12
"Generally Accepted Accounting Principles" or
"GAAP"..................................................12
"Global Securities".......................................13
"Guarantee"...............................................13
"Guaranteed Debt".........................................13
"Guarantor"...............................................13
"Holder"..................................................13
"Indebtedness"............................................14
"Indenture"...............................................15
"Indenture Obligations"...................................16
"Initial Securities"......................................16
"Initial Purchasers"......................................16
"Interest Payment Date"...................................16
"Interest Rate Agreements"................................16
"Inventory Facility"......................................16
"Investment"..............................................16
"Issue Date"..............................................17
"Lien"....................................................17
"Manufacturer"............................................17
"Maturity"................................................17
"Moody's".................................................17
"Net Cash Proceeds".......................................17
"Non-U.S. Person".........................................18
"Officers' Certificate"...................................18
"Opinion of Counsel"......................................18
"Opinion of Independent Counsel"..........................19
"Outstanding".............................................19
"Pari Passu Indebtedness".................................20
"Paying Agent"............................................20
"Permitted Holders".......................................20
"Permitted Investment"....................................20
"Person"..................................................21
"Predecessor Security"....................................21
"Preferred Stock".........................................21
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PAGE
"Prospectus"..............................................21
"Public Equity Offering"..................................22
"Purchase Money Obligation"...............................22
"QIB".....................................................22
"Qualified Capital Stock".................................22
"Redeemable Capital Stock"................................23
"Redemption Date".........................................24
"Redemption Price"........................................24
"Registration Rights Agreement"...........................24
"Registration Statement"..................................24
"Regular Record Date".....................................24
"Regulation S"............................................24
"Regulation S Global Securities"..........................25
"Responsible Officer".....................................25
"Replacement Assets"......................................25
"Restricted Subsidiary"...................................25
"Revolving Facility"......................................25
"Rule 144A"...............................................25
"Rule 144A Global Securities".............................26
"S&P".....................................................26
"Securities Act"..........................................26
"Senior Guarantor Indebtedness"...........................26
"Senior Indebtedness".....................................27
"Senior Representative"...................................27
"Series B Global Securities"..............................27
"Shelf Registration Statement"............................27
"Significant Restricted Subsidiary".......................28
"Smith Subordinated Loan".................................28
"Special Record Date".....................................28
"Stated Maturity".........................................28
"Subordinated Indebtedness"...............................28
"Subsidiary"..............................................28
"Successor Security"......................................29
"Temporary Cash Investments"..............................29
"Trustee".................................................29
"Trust Indenture Act".....................................29
"Unrestricted Subsidiary".................................30
"Unrestricted Subsidiary Indebtedness"....................30
"Voting Stock"............................................30
"Wholly Owned Restricted Subsidiary"......................30
Section 102. Other Definitions. ............................................31
Section 103. Compliance Certificates and Opinions. .........................31
Section 104. Form of Documents Delivered to Trustee. .......................32
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PAGE
Section 105. Acts of Holders. ..............................................33
Section 106. Notices, etc., to the Trustee, the Company and any
Guarantor. ...............................................35
Section 107. Notice to Holders; Waiver. ....................................35
Section 108. Conflict with Trust Indenture Act. ............................36
Section 109. Effect of Headings and Table of Contents. .....................36
Section 110. Successors and Assigns. .......................................36
Section 111. Separability Clause. ..........................................36
Section 112. Benefits of Indenture. ........................................36
SECTION 113. GOVERNING LAW. ................................................37
Section 114. Legal Holidays. ...............................................37
Section 115. Independence of Covenants. ....................................37
Section 116. Schedules and Exhibits. .......................................37
Section 117. Counterparts.. ................................................37
ARTICLE TWO SECURITY FORMS ....................................38
Section 201. Forms Generally. ..............................................38
Section 202. Form of Face of Security. .....................................39
Section 203. Form of Reverse of Securities. ................................53
Section 204. Form of Guarantee. ..........................................61
ARTICLE THREE THE SECURITIES ...................................63
Section 301. Title and Terms. ..............................................63
Section 302. Denominations. ................................................64
Section 303. Execution, Authentication, Delivery and Dating. ...............64
Section 304. Temporary Securities. .........................................66
Section 305. Registration, Registration of Transfer and Exchange. ..........66
Section 306. Book Entry Provisions for Global Securities. ..................68
Section 307. Special Transfer and Exchange Provisions. .....................70
Section 308. Mutilated, Destroyed, Lost and Stolen Securities. .............73
Section 309. Payment of Interest; Interest Rights Preserved. ...............74
Section 310. CUSIP Numbers. ................................................75
Section 311. Persons Deemed Owners. ........................................75
Section 312. Cancellation. .................................................76
Section 313. Computation of Interest. ......................................76
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PAGE
ARTICLE FOUR DEFEASANCE AND COVENANT
DEFEASANCE ............................................76
Section 401. Company's Option to Effect Defeasance or Covenant
Defeasance. ..............................................76
Section 402. Defeasance and Discharge. .....................................76
Section 403. Covenant Defeasance. ..........................................77
Section 404. Conditions to Defeasance or Covenant Defeasance. ..............77
Section 405. Deposited Money and U.S. Government Obligations to
Be Held in Trust; Other Miscellaneous Provisions. ........80
Section 406. Reinstatement. ................................................80
ARTICLE FIVE REMEDIES .......................................81
Section 501. Events of Default. ............................................81
Section 502. Acceleration of Maturity; Rescission and Annulment. ...........83
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee. .................................................84
Section 504. Trustee May File Proofs of Claim. .............................85
Section 505. Trustee May Enforce Claims without Possession of
Securities. ..............................................86
Section 506. Application of Money Collected. ...............................86
Section 507. Limitation on Suits. ..........................................87
Section 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest. ....................................88
Section 509. Restoration of Rights and Remedies. ...........................88
Section 510. Rights and Remedies Cumulative. ...............................88
Section 511. Delay or Omission Not Waiver. .................................88
Section 512. Control by Holders. ...........................................89
Section 513. Waiver of Past Defaults. ......................................89
Section 514. Undertaking for Costs. ........................................89
Section 515. Waiver of Stay, Extension or Usury Laws. ......................90
Section 516. Remedies Subject to Applicable Law. ...........................90
ARTICLE SIX THE TRUSTEE ......................................90
Section 601. Duties of Trustee. ............................................90
Section 602. Notice of Defaults. ...........................................92
Section 603. Certain Rights of Trustee. ....................................92
Section 604. Trustee Not Responsible for Recitals, Dispositions of
Securities or Application of Proceeds Thereof. ...........94
Section 605. Trustee and Agents May Hold Securities; Collections;
etc. .....................................................94
Section 606. Money Held in Trust. ..........................................94
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PAGE
Section 607. Compensation and Indemnification of Trustee and Its
Prior Claim. .............................................95
Section 608. Conflicting Interests. ........................................95
Section 609. Trustee Eligibility. ..........................................96
Section 610. Resignation and Removal; Appointment of Successor
Trustee. .................................................96
Section 611. Acceptance of Appointment by Successor. .......................98
Section 612. Merger, Conversion, Consolidation or Succession to
Business. ................................................98
Section 613. Preferential Collection of Claims Against Company. ............99
ARTICLE SEVEN HOLDERS' LISTS AND REPORTS
BY TRUSTEE AND COMPANY ......................................99
Section 701. Company to Furnish Trustee Names and Addresses of
Holders. .................................................99
Section 702. Disclosure of Names and Addresses of Holders. ................100
Section 703. Reports by Trustee. ..........................................100
Section 704. Reports by Company and Guarantors. ...........................100
ARTICLE EIGHT CONSOLIDATION, MERGER, SALE
OF ASSETS ............................................101
Section 801. Company and Guarantors May Consolidate, etc., Only on
Certain Terms. ..........................................102
Section 802. Successor Substituted. .......................................104
ARTICLE NINE SUPPLEMENTAL INDENTURES ...............................105
Section 901. Supplemental Indentures and Agreements without
Consent of Holders. .....................................105
Section 902. Supplemental Indentures and Agreements with Consent
of Holders. .............................................106
Section 903. Execution of Supplemental Indentures and Agreements.
..........................................................................107
Section 904. Effect of Supplemental Indentures. ...........................108
Section 905. Conformity with Trust Indenture Act. .........................108
Section 906. Reference in Securities to Supplemental Indentures. ..........108
Section 907. Notice of Supplemental Indentures. ...........................108
ARTICLE TEN COVENANTS ......................................108
Section 1001. Payment of Principal, Premium and Interest. .................109
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PAGE
Section 1002. Maintenance of Office or Agency. ............................109
Section 1003. Money for Security Payments to Be Held in Trust. ............109
Section 1004. Corporate Existence. ........................................111
Section 1005. Payment of Taxes and Other Claims. ..........................111
Section 1006. Maintenance of Properties. ..................................112
Section 1007. Maintenance of Insurance. ...................................112
Section 1008. Limitation on Indebtedness. .................................112
Section 1009. Limitation on Restricted Payments. ..........................115
Section 1010. Limitation on Transactions with Affiliates. .................120
Section 1011. Limitation on Liens. ........................................121
Section 1012. Limitation on Sale of Assets. ...............................122
Section 1013. Limitation on Issuances of Guarantees of and Pledges
for Indebtedness. .......................................127
Section 1014. Purchase of Securities upon a Change of Control. ............128
Section 1015. Limitation on Subsidiary Preferred Stock. ...................132
Section 1016. Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries. ....................133
Section 1017. Limitation on Senior Subordinated Indebtedness. .............134
Section 1018. Limitations on Unrestricted Subsidiaries. ...................134
Section 1019. Provision of Financial Statements. ..........................136
Section 1020. Statement by Officers as to Default. ........................137
Section 1021. Waiver of Certain Covenants. ................................138
ARTICLE ELEVEN REDEMPTION OF SECURITIES .............................138
Section 1101. Rights of Redemption. .......................................139
Section 1102. Applicability of Article. ...................................139
Section 1103. Election to Redeem; Notice to Trustee. ......................139
Section 1104. Selection by Trustee of Securities to Be Redeemed. ..........139
Section 1105. Notice of Redemption. .......................................140
Section 1106. Deposit of Redemption Price. ................................141
Section 1107. Securities Payable on Redemption Date. ......................141
Section 1108. Securities Redeemed or Purchased in Part. ...................142
ARTICLE TWELVE SATISFACTION AND
DISCHARGE ............................................142
Section 1201. Satisfaction and Discharge of Indenture. ....................142
Section 1202. Application of Trust Money. .................................143
ARTICLE THIRTEEN GUARANTEES ...................................144
Section 1301. Guarantors' Guarantee. .....................................144
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PAGE
Section 1302. Continuing Guarantee; No Right of Set-Off;
Independent Obligation. .................................144
Section 1303. Guarantee Absolute. ........................................145
Section 1304. Right to Demand Full Performance. ..........................148
Section 1305. Waivers. ...................................................148
Section 1306. The Guarantors Remain Obligated in Event the
Company Is No Longer Obligated to Discharge
Indenture Obligations. ..................................149
Section 1307. Fraudulent Conveyance; Contribution; Subrogation. ..........150
Section 1308. Guarantee Is in Addition to Other Security. ................151
Section 1309. Release of Security Interests. .............................151
Section 1310. No Bar to Further Actions. .................................151
Section 1311. Failure to Exercise Rights Shall Not Operate as a
Waiver; No Suspension of Remedies. ......................151
Section 1312. Trustee's Duties; Notice to Trustee. .......................152
Section 1313. Successors and Assigns. ....................................153
Section 1314. Release of Guarantee. ......................................153
Section 1315. Execution of Guarantee. ....................................154
ARTICLE FOURTEEN SUBORDINATION OF
SECURITIES ............................................154
Section 1401. Securities Subordinate to Senior Indebtedness. ..............154
Section 1402. Payment Over of Proceeds Upon Dissolution, etc. .............155
Section 1403. Suspension of Payment When Designated Senior
Indebtedness in Default. ................................156
Section 1404. Payment Permitted if No Default. ............................158
Section 1405. Subrogation to Rights of Holders of Senior
Indebtedness. ...........................................158
Section 1406. Provisions Solely to Define Relative Rights. ................158
Section 1407. Trustee to Effectuate Subordination. ........................159
Section 1408. No Waiver of Subordination Provisions. ......................159
Section 1409. Notice to Trustee. ..........................................160
Section 1410. Reliance on Judicial Orders or Certificates. ................161
Section 1411. Rights of Trustee as a Holder of Senior Indebtedness;
Preservation of Trustee's Rights. .......................161
Section 1412. Article Applicable to Paying Agents. ........................161
Section 1413. No Suspension of Remedies. ..................................162
Section 1414. Trustee's Relation to Senior Indebtedness. ..................162
TESTIMONIUM
SIGNATURES AND SEALS
ACKNOWLEDGMENTS
- viii -
PAGE
ANNEX A Form of Intercompany Note
SCHEDULE I Existing Indebtedness
EXHIBIT A Regulation S Certificate
EXHIBIT B Restricted Security Certificate
EXHIBIT C Unrestricted Security Certificate
APPENDIX I Form of Transferee Certificate for Series A Securities
APPENDIX II Form of Transferee Certificate for Series B Securities
- ix -
INDENTURE, dated as of July 1, 1998, between Sonic Automotive, Inc.,
a Delaware corporation (the "Company"), and Town and Counrty Ford, Inc., a North
Carolina corporation, Marcus David Corporation, a North Carolina corporation,
Frontier Oldsmobile-Cadillac, Inc., a North Carolina corporation, Sonic Dodge,
LLC, a North Carolina limited liability company, Sonic
Chrysler-Plymouth-Jeep-Eagle, LLC, a North Carolina limited liability company,
Fort Mill Ford, Inc., a South Carolina corporation, Town and Country
Chrysler-Plymouth-Jeep of Rock Hill, Inc., a South Carolina corporation, Fort
Mill Chrysler-Plymouth-Dodge, Inc., a South Carolina corporation, Lone Star
Ford, Inc., a Texas corporation, Sonic Automotive of Nevada, Inc., a Nevada
corporation, Sonic Automotive of Tennessee, Inc., a Tennessee corporation, Sonic
Automotive-6025 International Drive, LLC, a Tennessee limited liability company,
Sonic Automotive of Nashville, LLC, a Tennessee limited liability company, Sonic
Automotive of Chattanooga, LLC, a Tennessee limited liability company, Town and
Country Jaguar, LLC, a Tennessee limited liability company, Town and Country
Chrysler-Plymouth-Jeep, LLC, a Tennessee limited liability company, Town and
Country Dodge of Chattanooga, LLC, a Tennessee limited liability company, Sonic
Automotive-2490 South Lee Highway, LLC, a Tennessee limited liability company,
Town and Country Ford of Cleveland, LLC, an Ohio limited liability company,
Freedom Ford, Inc., a Florida corporation, Sonic Automotive 5260 Peachtree
Industrial Blvd, LLC, a Georgia limited liability company, Sonic Automotive of
Georgia, Inc., a Georgia corporation, Sonic Peachtree Industrial Blvd., L.P., a
Georgia limited partnership, Sonic Automotive - Clearwater, Inc., a Florida
corporation, Sonic Automotive 21699 U.S. Hwy 19 N., Inc., a Florida corporation,
Sonic Automotive Collision Center of Clearwater, Inc., a Florida corporation,
Sonic Automotive - 1400 Automall Drive, Columbus, Inc., an Ohio corporation,
Sonic Automotive - 1455 Automall Drive, Columbus, Inc., an Ohio corporation,
Sonic Automotive - 1495 Automall Drive, Columbus, Inc., an Ohio corporation,
Sonic Automotive - 1500 Automall Drive, Columbus, Inc., an Ohio corporation,
Sonic Automotive - 3700 West Broad Street, Columbus, Inc., an Ohio corporation,
Sonic Automotive - 4000 West Broad Street, Columbus, Inc., an Ohio corporation,
Sonic Automotive 2424 Laurens Rd., Greenville, Inc., a South Carolina
corporation, Sonic Automotive 2752 Laurens Rd., Greenville, Inc., a South
Carolina corporation, Sonic Automotive - 5585 Peachtree Industrial Blvd., LLC, a
Georgia limited liability company, Capitol Chevrolet and Imports, Inc., an
Alabama corporation, Sonic Automotive - 1919 N. Dixie Hwy., NSB, Inc., a Florida
corporation, Sonic Automotive - 1307 N. Dixie Hwy., NSB, Inc., a Florida
corporation, Sonic Automotive - 1720 Mason Ave, DB, Inc., a Florida corporation,
Sonic Automotive - 3741 S. Nova Rd., PO, Inc., a Florida corporation, Sonic
Automotive - 241 Ridgewood Ave., HH, Inc., a Florida corporation and Sonic
Automotive - Hwy. 153 at Shallowford Road, Chattanooga, Inc., a Tennessee
corporation (each a "Guarantor" and collectively, the "Guarantors") and
U.S. Bank Trust National Association, as Trustee (the "Trustee").
- 1 -
RECITALS OF THE COMPANY AND THE GUARANTORS
The Company has duly authorized the creation of an issue of 11%
Senior Subordinated Notes due 2008, Series A (the "Series A Securities" or the
"Initial Securities"), and an issue of 11% Senior Subordinated Notes due 2008,
Series B (the "Series B Securities" and, together with the Series A Securities,
the "Securities"), of substantially the tenor and amount hereinafter set forth,
and to provide therefor the Company has duly authorized the execution and
delivery of this Indenture and the Securities;
Each Guarantor has duly authorized the issuance of a Guarantee of
the Securities, of substantially the tenor hereinafter set forth, and to provide
therefor, each Guarantor has duly authorized the execution and delivery of this
Indenture and its Guarantee;
This Indenture is subject to, and shall be governed by, the
provisions of the Trust Indenture Act that are required to be part of and to
govern indentures qualified under the Trust Indenture Act;
All acts and things necessary have been done to make (i) the
Securities, when duly issued and executed by the Company and authenticated and
delivered hereunder, the valid obligations of the Company, (ii) the Guarantees,
when executed by each of the Guarantors and delivered hereunder, the valid
obligation of each of the Guarantors and (iii) this Indenture a valid agreement
of the Company and each of the Guarantors in accordance with the terms of this
Indenture;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
- 2 -
(b) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP;
(d) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(e) all references to $, US$, dollars or United States dollars shall
refer to the lawful currency of the United States of America; and
(f) all references herein to particular Sections or Articles refer
to this Indenture unless otherwise so indicated.
Certain terms used principally in Article Four are defined in
Article Four.
"Acquired Indebtedness" means Indebtedness of a Person (i) existing
at the time such Person becomes a Restricted Subsidiary or (ii) assumed in
connection with the acquisition of assets from such Person, in each case, other
than Indebtedness incurred in connection with, or in contemplation of, such
Person becoming a Restricted Subsidiary or such acquisition, as the case may be.
Acquired Indebtedness shall be deemed to be incurred on the date of the related
acquisition of assets from any Person or the date the acquired Person becomes a
Restricted Subsidiary, as the case may be.
"Affiliate" means, with respect to any specified Person: (i) any
other Person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person; (ii) any other Person
that owns, directly or indirectly, 5% or more of such specified Person's Capital
Stock or any officer or director of any such specified Person or other Person
or, with respect to any natural Person, any person having a relationship with
such Person by blood, marriage or adoption not more remote than first cousin; or
(iii) any other Person 5% or more of the Voting Stock of which is beneficially
owned or held directly or indirectly by such specified Person. For the purposes
of this definition, "control" when used with respect to any specified Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
- 3 -
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security, Euroclear and Cedel,
in each case to the extent applicable to such transaction and as in effect at
the time of such transfer or transaction.
"Asset Sale" means any sale, issuance, conveyance, transfer, lease
or other disposition (including, without limitation, by way of merger,
consolidation or sale and leaseback Transaction) (collectively, a "transfer"),
directly or indirectly, in one or a series of related transactions, of: (i) any
Capital Stock of any Restricted Subsidiary (other than directors' qualifying
shares and transfers of Capital Stock required by a Manufacturer to the extent
the Company does not receive cash or Cash Equivalents for such Capital Stock);
(ii) all or substantially all of the properties and assets of any division or
line of business of the Company or any Restricted Subsidiary; or (iii) any other
properties or assets of the Company or any Restricted Subsidiary other than in
the ordinary course of business. For the purposes of this definition, the term
"Asset Sale" shall not include any transfer of properties and assets (A) that is
governed by the provisions described under Article Eight hereof, (B) that is by
the Company to any Wholly Owned Restricted Subsidiary, or by any Restricted
Subsidiary to the Company or any Wholly Owned Restricted Subsidiary in
accordance with the terms of this Indenture, (C) that is of obsolete equipment,
(D) that consists of defaulted receivables for collection or any sale, transfer
or other disposition of defaulted receivables for collection, or (E) the Fair
Market Value of which in the aggregate does not exceed $2.5 million in any
transaction or series of related transactions.
"Average Life to Stated Maturity" means, as of the date of
determination with respect to any Indebtedness, the quotient obtained by
dividing (i) the sum of the products of (a) the number of years from the date of
determination to the date or dates of each successive scheduled principal
payment of such Indebtedness multiplied by (b) the amount of each such principal
payment; by (ii) the sum of all such principal payments.
"Bankruptcy Law" means Title 11, United States Bankruptcy Code of
1978, as amended, or any similar United States federal or state law relating to
bankruptcy, insolvency, receivership, winding up, liquidation, reorganization or
relief of debtors or any amendment to, succession to or change in any such law.
"Board of Directors" means the board of directors of the Company or
any Guarantor, as the case may be, or any duly authorized committee of such
board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company or any Guarantor, as the case
may be, to have been duly adopted by the Board of Directors and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
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"Book-Entry Security" means any Global Securities bearing the legend
specified in Section 202 evidencing all or part of a series of Securities,
authenticated and delivered to the Depositary for such series or its nominee,
and registered in the name of such Depositary or nominee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions or trust companies in
The City of New York or the city in which the Corporate Trust Office of the
Trustee is located are authorized or obligated by law, regulation or executive
order to close.
"Capital Lease Obligation" of any Person means any obligation of
such Person and its Subsidiaries on a Consolidated basis under any capital lease
of real or personal property which, in accordance with GAAP, has been recorded
as a capitalized lease obligation.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of such Person's
capital stock or other equity interests whether now outstanding or issued after
the date hereof, partnership interests (whether general or limited), any other
interest or participation that confers on a Person that right to receive a share
of the profits and losses of, or distributions of assets of (other than a
distribution in respect of Indebtedness), the issuing Person and any rights
(other than debt securities convertible into Capital Stock), warrants or options
exchangeable for or convertible into such Capital Stock.
-5-
"Cash Equivalents" means (i) marketable direct obligations, maturing
not more than one year after the date of acquisition, issued by the United
States of America, or an instrumentality or agency thereof, and guaranteed fully
as to principal, premium, if any, and interest by the United States of America,
(ii) any certificate of deposit, maturing not more than one year after the date
of acquisition, issued by a commercial banking institution that is a member of
the Federal Reserve System and that has combined capital and surplus and
undivided profits of not less than $500 million, whose debt has a rating, at the
time as of which any investment therein is made, of "P- 1" (or higher) according
to Moody's or any successor rating agency or "A-1" (or higher) according to S&P
or successor rating agency, (iii) commercial paper, maturing not more than180
days after the date of acquisition, issued by a corporation (other than an
Affiliate or Subsidiary of the Company) organized and existing under the laws of
the United States of America with a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to Moody's or "A-1"
(or higher) according to S&P and (iv) any money market deposit accounts issued
or offered by a domestic commercial bank having capital and surplus in excess of
$500 million; provided that the short term debt of such commercial bank has a
rating, at the time of Investment, of "P-1" (or higher) according to Moody's or
"A-1" (or higher) according to S&P.
"Cedel" means Cedel, S.A. (or any successor securities clearing
agency).
"Change of Control" means the occurrence of any of the following
events: (i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act), other than Permitted Holders, is or becomes the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that a Person shall be deemed to have beneficial ownership of all shares
that such Person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of more
than 35% of the total outstanding Voting Stock of the Company; (ii) during any
period of two consecutive years, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together with any new
directors whose election to such board or whose nomination for election by the
stockholders of the Company was approved by a vote of 66 2/3% of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved), cease
for any reason to constitute a majority of such Board of Directors then in
office; (iii) the Company consolidates with or merges with or into any Person or
sells, assigns, conveys, transfers, leases or otherwise disposes of all or
substantially all of its assets to any Person, or any Person consolidates with
or merges into or with the Company, in any such event pursuant to a transaction
in which the outstanding Voting Stock of the Company is converted into or
exchanged for cash, securities or other property, other than any such
transaction where (A) the outstanding Voting Stock of the Company is changed
into or exchanged for (x) Voting Stock of the surviving corporation which is not
Redeemable Capital Stock or (y) cash, securities and other property (other than
Capital Stock of the surviving corporation) in an
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amount which could be paid by the Company as a Restricted Payment as described
in Section 1009 herein (and such amount shall be treated as a Restricted Payment
subject to the provisions in this Indenture described in Section 1009 herein)
and (B) immediately after such transaction, no "person" or "group," other than
Permitted Holders, is the beneficial owner (as defined in Rules 13d-3 and 13d-5
under the Exchange Act, except that a person shall be deemed to have beneficial
ownership of all securities that such person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time),
directly or indirectly, more than 35% of the total outstanding Voting Stock of
the surviving corporation; or (iv) the Company is liquidated or dissolved or
adopts a plan of liquidation or dissolution other than in a transaction which
complies with the provisions described under Article Eight herein. For purposes
of this definition, any transfer of an equity interest of an entity that was
formed for the purpose of acquiring voting stock of the Company will be deemed
to be a transfer of such portion of such voting stock as corresponds to the
portion of the equity of such entity that has been so transferred.
"Class A Common Stock" means the Company's Class A Common Stock, par
value $.01 per share, or any successor common stock thereto.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Securities Act, Exchange Act
and Trust Indenture Act then the body performing such duties at such time.
"Commodity Price Protection Agreement" means any forward contract,
commodity swap, commodity option or other similar financial agreement or
arrangement relating to, or the value which is dependent upon, fluctuations in
commodity prices.
"Company" means Sonic Automotive, Inc., a corporation incorporated
under the laws of Delaware, until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by any one of its Chairman of the Board,
its President, its Chief Executive Officer, its Chief Financial Officer or a
Vice President (regardless of Vice Presidential designation), and by any one of
its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"Consolidated Fixed Charge Coverage Ratio" of any Person means, for
any period, the ratio of (a) the sum of Consolidated Net Income (Loss), and in
each case to
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the extent deducted in computing Consolidated Net Income (Loss) for such period,
Consolidated Interest Expense, Consolidated Income Tax Expense and Consolidated
Non-cash Charges for such period, of such Person and its Restricted Subsidiaries
on a Consolidated basis, all determined in accordance with GAAP, less all
noncash items increasing Consolidated Net Income for such period and less all
cash payments during such period relating to noncash charges that were added
back to Consolidated Net Income in determining the Consolidated Fixed Charge
Coverage Ratio in any prior period to (b) the sum of Consolidated Interest
Expense for such period and cash and noncash dividends paid on any Preferred
Stock of such Person during such period, in each case after giving pro forma
effect to (i) the incurrence of the Indebtedness giving rise to the need to make
such calculation and (if applicable) the application of the net proceeds
therefrom, including to refinance other Indebtedness, as if such Indebtedness
was incurred, and the application of such proceeds occurred, on the first day of
such period; (ii) the incurrence, repayment or retirement of any other
Indebtedness by the Company and its Restricted Subsidiaries since the first day
of such period as if such Indebtedness was incurred, repaid or retired at the
beginning of such period (except that, in making such computation, the amount of
Indebtedness under any revolving credit facility shall be computed based upon
the average daily balance of such Indebtedness during such period); (iii) in the
case of Acquired Indebtedness or any acquisition occurring at the time of the
incurrence of such Indebtedness, the related acquisition, assuming such
acquisition had been consummated on the first day of such period; and (iv) any
acquisition or disposition by the Company and its Restricted Subsidiaries of any
company or any business or any assets out of the ordinary course of business,
whether by merger, stock purchase or sale or asset purchase or sale, or any
related repayment of Indebtedness, in each case since the first day of such
period, assuming such acquisition or disposition had been consummated on the
first day of such period; provided that (i) in making such computation, the
Consolidated Interest Expense attributable to interest on any Indebtedness
computed on a pro forma basis and (A) bearing a floating interest rate shall be
computed as if the rate in effect on the date of computation had been the
applicable rate for the entire period and (B) which was not outstanding during
the period for which the computation is being made but which bears, at the
option of such Person, a fixed or floating rate of interest, shall be computed
by applying at the option of such Person either the fixed or floating rate and
(ii) in making such computation, the Consolidated Interest Expense of such
Person attributable to interest on any Indebtedness under a revolving credit
facility computed on a pro forma basis shall be computed based upon the average
daily balance of such Indebtedness during the applicable period.
"Consolidated Income Tax Expense" of any Person means, for any
period, the provision for federal, state, local and foreign income taxes of such
Person and its Consolidated Restricted Subsidiaries for such period as
determined in accordance with GAAP.
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"Consolidated Interest Expense" of any Person means, without
duplication, for any period, the sum of (a) the interest expense of such Person
and its Restricted Subsidiaries for such period, on a Consolidated basis (other
than interest expense under any Inventory Facility), including, without
limitation, (i) amortization of debt discount, (ii) the net costs associated
with Interest Rate Agreements, Currency Hedging Agreements and Commodity Price
Protection Agreements (including amortization of discounts), (iii) the interest
portion of any deferred payment obligation, (iv) all commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers
acceptance financing and (v) accrued interest, plus (b) (i) the interest
component of the Capital Lease Obligations paid, accrued and/or scheduled to be
paid or accrued by such Person and its Restricted Subsidiaries during such
period and (ii) all capitalized interest of such Person and its Restricted
Subsidiaries, plus (c) the interest expense under any Guaranteed Debt of such
Person and any Restricted Subsidiary to the extent not included under clause
(a)(iv) above, whether or not paid by such Person or its Restricted
Subsidiaries.
"Consolidated Net Income (Loss)" of any Person means, for any
period, the Consolidated net income (or loss) of such Person and its Restricted
Subsidiaries for such period on a Consolidated basis as determined in accordance
with GAAP, adjusted, to the extent included in calculating such net income (or
loss), by excluding, without duplication, (i) all extraordinary gains or losses
net of taxes (less all fees and expenses relating thereto), (ii) the portion of
net income (or loss) of such Person and its Restricted Subsidiaries on a
Consolidated basis allocable to minority interests in unconsolidated Persons or
Unrestricted Subsidiaries to the extent that cash dividends or distributions
have not actually been received by such Person or one of its Consolidated
Restricted Subsidiaries, (iii) net income (or loss) of any Person combined with
such Person or any of its Restricted Subsidiaries on a "pooling of interests"
basis attributable to any period prior to the date of combination, (iv) any gain
or loss, net of taxes, realized upon the termination of any employee pension
benefit plan, (v) gains or losses, net of taxes (less all fees and expenses
relating thereto), in respect of dispositions of assets other than in the
ordinary course of business, (vi) the net income of any Restricted Subsidiary to
the extent that the declaration of dividends or similar distributions by that
Restricted Subsidiary of that income is not at the time permitted, directly or
indirectly, by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Restricted Subsidiary or its stockholders, (vii) any
restoration to net income of any contingency reserve, except to the extent
provision for such reserve was made out of income accrued at any time following
the Issue Date, or (viii) any net gain arising from the acquisition of any
securities or extinguishment, under GAAP, of any Indebtedness of such Person.
"Consolidated Non-cash Charges" of any Person means, for any period,
the aggregate depreciation, amortization and other non-cash charges of such
Person and its subsidiaries on a Consolidated basis for such period, as
determined in accordance with
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GAAP (excluding any non-cash charge which requires an accrual or reserve for
cash charges for any future period).
"Consolidated Tangible Assets" of any Person means (a) all amounts
that would be shown as assets on a Consolidated balance sheet of such Person and
its Restricted Subsidiaries prepared in accordance with GAAP, less (b) the
amount thereof constituting goodwill and with intangible assets as calculated in
accordance with GAAP.
"Consolidation" means, with respect to any Person, the consolidation
of the accounts of such Person and each of its subsidiaries if and to the extent
the accounts of such Person and each of its subsidiaries would normally be
consolidated with those of such Person, all in accordance with GAAP. The term
"Consolidated" shall have a similar meaning.
"Corporate Trust Office" means the office of the Trustee or an
affiliate or agent thereof at which at any particular time the corporate trust
business for the purposes of this Indenture shall be principally administered,
which office at the date of execution of this Indenture is located at 100 Wall
Street, 20th Floor, New York, New York 10005.
"Currency Hedging Agreements" means one or more of the following
agreements which shall be entered into by one or more financial institutions:
foreign exchange contracts, currency swap agreements or other similar agreements
or arrangements designed to protect against the fluctuations in currency values.
"Default" means any event which is, or after notice or passage of
any time or both would be, an Event of Default.
"Depositary" means, with respect to the Securities issued in the
form of one or more Book-Entry Securities, The Depository Trust Company ("DTC"),
its nominees and successors, or another Person designated as Depositary by the
Company, which must be a clearing agency registered under the Exchange Act.
"Designated Senior Indebtedness" means (i) all Senior Indebtedness
under the Floor Plan Facility or the Revolving Facility and (ii) any other
Senior Indebtedness which at the time of determination has an aggregate
principal amount outstanding of at least $25 million and which is specifically
designated in the instrument evidencing such Senior Indebtedness or the
agreement under which such Senior Indebtedness arises as "Designated Senior
Indebtedness" by the Company.
"Disinterested Director" means, with respect to any transaction or
series of related transactions, a member of the Board of Directors of the
Company who does not have any material direct or indirect financial interest in
or with respect to such transaction or series of related transactions.
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"Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency).
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute, and the rules and regulations promulgated by
the Commission thereunder.
"Exchange Offer" means the exchange offer by the Company and the
Guarantors of Series B Securities for Series A Securities to be effected
pursuant to Section 2.1 of the Registration Rights Agreement.
"Exchange Offer Registration Statement" means the registration
statement under the Securities Act contemplated by Section 2.1 of the
Registration Rights Agreement.
"Fair Market Value" means, with respect to any asset or property,
the sale value that would be obtained in an arm's-length free market transaction
between an informed and willing seller under no compulsion to sell and an
informed and willing buyer under no compulsion to buy. Fair Market Value shall
be determined by the Board of Directors of the Company acting in good faith and
shall be evidenced by a Board Resolution.
"Floor Plan Facility" means an agreement from Ford Motor Credit
Company or any other bank or asset-based lender pursuant to which the Company or
any Restricted Subsidiary incurs Indebtedness all of the net proceeds of which
are used to purchase, finance or refinance vehicles and/or vehicle parts and
supplies to be sold in the ordinary course of business of the Company and its
Restricted Subsidiaries and which may not be secured except by a Lien that does
not extend to or cover any property other than the property of the dealership(s)
which use the proceeds of the Floor Plan Facility.
"Generally Accepted Accounting Principles" or "GAAP" means generally
accepted accounting principles in the United States, consistently applied, which
(i) for the purpose of determining compliance with the covenants contained in
this Indenture, are in effect as of the Issue Date, and (ii) for purposes of
compliance with the reporting requirements contained in this Indenture, are in
effect from time to time.
"Global Securities" means the Rule 144A Global Securities, the
Regulation S Global Securities and the Series B Global Securities to be issued
as Book-Entry Securities issued to the Depositary in accordance with Section
306.
"Guarantee" means the guarantee by any Guarantor of the Company's
Indenture Obligations.
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"Guaranteed Debt" of any Person means, without duplication, all
Indebtedness of any other Person referred to in the definition of Indebtedness
below guaranteed directly or indirectly in any manner by such Person, or in
effect guaranteed directly or indirectly by such Person through an agreement (i)
to pay or purchase such Indebtedness or to advance or supply funds for the
payment or purchase of such Indebtedness, (ii) to purchase, sell or lease (as
lessee or lessor) property, or to purchase or sell services, primarily for the
purpose of enabling the debtor to make payment of such Indebtedness or to assure
the holder of such Indebtedness against loss, (iii) to supply funds to, or in
any other manner invest in, the debtor (including any agreement to pay for
property or services without requiring that such property be received or such
services be rendered), (iv) to maintain working capital or equity capital of the
debtor, or otherwise to maintain the net worth, solvency or other financial
condition of the debtor or to cause such debtor to achieve certain levels of
financial performance or (v) otherwise to assure a creditor against loss;
provided that the term "guarantee" shall not include endorsements for collection
or deposit, in either case in the ordinary course of business.
"Guarantor" means any Subsidiary which is a guarantor of the
Securities, including any Person that is required after the Issue Date to
execute a guarantee of the Securities pursuant to Section 1011 or Section 1013
until a successor replaces such party pursuant to the applicable provisions of
this Indenture and, thereafter, shall mean such successor.
"Holder" means a Person in whose name a Security is registered in
the Security Register.
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"Indebtedness" means, with respect to any Person, without
duplication, (i) all indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services, excluding any trade payables
and other accrued current liabilities arising in the ordinary course of
business, but including, without limitation, all obligations, contingent or
otherwise, of such Person in connection with any letters of credit issued under
letter of credit facilities, acceptance facilities or other similar facilities,
(ii) all obligations of such Person evidenced by bonds, notes, debentures or
other similar instruments, (iii) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even if the rights and remedies of the seller or lender
under such agreement in the event of default are limited to repossession or sale
of such property), but excluding trade payables arising in the ordinary course
of business, (iv) all obligations of such Person under Interest Rate Agreements,
Currency Hedging Agreements or Commodity Price Protection Agreements of such
Person, (v) all Capital Lease Obligations of such Person, (vi) all Indebtedness
referred to in clauses (i) through (v) above of other Persons and all dividends
of other Persons, the payment of which is secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien, upon or with respect to property (including, without limitation,
accounts and contract rights) owned by such Person, even though such Person has
not assumed or become liable for the payment of such Indebtedness, (vii) all
Guaranteed Debt of such Person, (viii) all Redeemable Capital Stock issued by
such Person valued at the greater of its voluntary or involuntary maximum fixed
repurchase price plus accrued and unpaid dividends, (ix) Preferred Stock of any
Restricted Subsidiary of the Company which is not a Guarantor and (x) any
amendment, supplement, modification, deferral, renewal, extension, refunding or
refinancing of any liability of the types referred to in clauses (i) through
(ix) above. For purposes hereof, the "maximum fixed repurchase price" of any
Redeemable Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Redeemable Capital Stock as if
such Redeemable 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 Redeemable Capital
Stock, such Fair Market Value to be determined in good faith by the board of
directors of the issuer of such Redeemable Capital Stock.
"Indenture" means this instrument as originally executed (including
all exhibits and schedules thereto) and as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof.
"Indenture Obligations" means the obligations of the Company and any
other obligor under this Indenture or under the Securities, including any
Guarantor, to pay principal of, premium, if any, and interest when due and
payable, and all other amounts due or to become due under or in connection with
this Indenture, the Securities and the
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performance of all other obligations to the Trustee and the Holders under this
Indenture and the Securities, according to the respective terms hereof and
thereof.
"Initial Securities" has the meaning stated in the first recital of
this Indenture.
"Initial Purchasers" means Merrill Lynch, Pierce, Fenner & Smith
Incorporated, NationsBanc Montgomery Securities LLC and BancAmerica Robertson
Stephens.
"Interest Payment Date" means the Stated Maturity of an installment
of interest on the Securities.
"Interest Rate Agreements" means one or more of the following
agreements which shall be entered into by one or more financial institutions:
interest rate protection agreements (including, without limitation, interest
rate swaps, caps, floors, collars and similar agreements) and/or other types of
interest rate hedging agreements from time to time.
"Inventory Facility" means any Floor Plan Facility or any other
agreement (including pursuant to a commercial paper program) pursuant to which
the Company or any Restricted Subsidiary incurs Indebtedness, the net proceeds
of which are used to purchase, finance or refinance vehicles and/or vehicle
parts and supplies to be sold in the ordinary course of business of the Company
and its Restricted Subsidiaries and which may not be secured except by Lien that
does not extend to or cover any property other than the property of the
dealership(s) which use the proceeds of the Inventory Facility.
"Investment" means, with respect to any Person, directly or
indirectly, any advance, loan (including guarantees), or other extension of
credit or capital contribution to (by means of any transfer of cash or other
property to others or any payment for property or services for the account or
use of others), or any purchase, acquisition or ownership by such Person of any
Capital Stock, bonds, notes, debentures or other securities issued or owned by
any other Person and all other items that would be classified as investments on
a balance sheet prepared in accordance with GAAP.
"Issue Date" means the original issue date of the Securities under
this Indenture.
"Lien" means any mortgage or deed of trust, charge, pledge, lien
(statutory or otherwise), privilege, security interest, assignment, deposit,
arrangement, easement, hypothecation, claim, preference, priority or other
encumbrance upon or with respect to any property of any kind (including any
conditional sale, capital lease or other title retention agreement, any leases
in the nature thereof, and any agreement to give any security interest), real or
personal, movable or immovable, now owned or hereafter
-14-
acquired. A Person will be deemed to own subject to a Lien any property which it
has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement, Capitalized Lease Obligation or other title
retention agreement.
"Manufacturer" means a vehicle manufacturer which is a party to a
dealership franchise agreement with the Company or any Restricted Subsidiary.
"Maturity" means, when used with respect to the Securities, the date
on which the principal of the Securities becomes due and payable as therein
provided or as provided in this Indenture, whether at Stated Maturity, the Offer
Date or the Redemption Date and whether by declaration of acceleration, Offer in
respect of Excess Proceeds, Change of Control Offer in respect of a Change of
Control, call for redemption or otherwise.
"Moody's" means Moody's Investors Service, Inc. or any successor
rating agency.
"Net Cash Proceeds" means (a) with respect to any Asset Sale by any
Person, the proceeds thereof (without duplication in respect of all Asset Sales)
in the form of cash or Temporary Cash Investments including payments in respect
of deferred payment obligations when received in the form of, or stock or other
assets when disposed of for, cash or Temporary Cash Investments (except to the
extent that such obligations are financed or sold with recourse to the Company
or any Restricted Subsidiary) net of (i) brokerage commissions and other
reasonable fees and expenses (including fees and expenses of counsel and
investment bankers) related to such Asset Sale, (ii) provisions for all taxes
payable as a result of such Asset Sale, (iii) payments made to retire
Indebtedness where payment of such Indebtedness is secured by the assets or
properties the subject of such Asset Sale, (iv) amounts required to be paid to
any Person (other than the Company or any Restricted Subsidiary) owning a
beneficial interest in the assets subject to the Asset Sale and (v) appropriate
amounts to be provided by the Company or any Restricted Subsidiary, as the case
may be, as a reserve, in accordance with GAAP, against any liabilities
associated with such Asset Sale and retained by the Company or any Restricted
Subsidiary, as the case may be, after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Asset Sale, all as reflected in an Officers'
Certificate delivered to the Trustee and (b) with respect to any issuance or
sale of Capital Stock or options, warrants or rights to purchase Capital Stock,
or debt securities or Capital Stock that have been converted into or exchanged
for Capital Stock as referred to in Section 1009, the proceeds of such issuance
or sale in the form of cash or Temporary Cash Investments including payments in
respect of deferred payment obligations when received in the form of, or stock
or other assets when disposed of for, cash or Temporary Cash Investments (except
to the extent that such obligations are financed or sold with recourse to the
Company or any Restricted
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Subsidiary), net of attorney's fees, accountant's fees and brokerage,
consultation, underwriting and other fees and expenses actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Non-U.S. Person" means a Person that is not a "U.S. person" as
defined in Regulation S under the Securities Act.
"Officers' Certificate" means a certificate signed by the Chairman
of the Board, the President, the Chief Executive Officer, the Chief Financial
Officer or a Vice President (regardless of Vice Presidential designation), and
by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company or any Guarantor, as the case may be, and in form and
substance reasonably satisfactory to, and delivered to, the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, any Guarantor or the Trustee, unless an Opinion of
Independent Counsel is required pursuant to the terms of this Indenture, and who
shall be acceptable to the Trustee, and which opinion shall be in form and
substance reasonably satisfactory to the Trustee.
"Opinion of Independent Counsel" means a written opinion of counsel
which is issued by a Person who is not an employee, director or consultant
(other than non-employee legal counsel) of the Company or any Guarantor and who
shall be acceptable to the Trustee, and which opinion shall be in form and
substance reasonably satisfactory to the Trustee.
"Outstanding" when used with respect to Securities means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(a) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(b) Securities, or portions thereof, for whose payment or redemption
money in the necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company or an Affiliate thereof) in trust or
set aside and segregated in trust by the Company or an Affiliate thereof (if the
Company or an Affiliate thereof shall act as its own Paying Agent) for the
Holders of such Securities; provided that if such Securities are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor reasonably satisfactory to the Trustee has been made;
-16-
(c) Securities, to the extent provided in Sections 402 and 403, with
respect to which the Company has effected defeasance or covenant defeasance as
provided in Article Four; and
(d) Securities in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have been presented to the
Trustee and the Company proof reasonably satisfactory to each of them that such
Securities are held by a bona fide purchaser in whose hands the Securities are
valid obligations of the Company; provided, however, that in determining whether
the Holders of the requisite principal amount of Outstanding Securities have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Securities owned by the Company, any Guarantor, or any other obligor
upon the Securities or any Affiliate of the Company, any Guarantor or such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Securities which the Trustee knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the reasonable satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company, any Guarantor or any other obligor upon the
Securities or any Affiliate of the Company, any Guarantor or such other obligor.
"Pari Passu Indebtedness" means (a) any Indebtedness of the Company
that is pari passu in right of payment to the Securities and (b) with respect to
any Guarantee, Indebtedness which ranks pari passu in right of payment to such
Guarantee.
"Paying Agent" means any Person (including the Company) authorized
by the Company to pay the principal of, premium, if any, or interest on, any
Securities on behalf of the Company.
"Permitted Holders" means (i) Mr. Bruton Smith or Mr. William S.
Egan and their respective guardians, conservators, committees, or
attorneys-in-fact; (ii) lineal descendants of Mr. Smith or Mr. Egan (in either
case, a "Descendant") and their respective guardians, conservators, committees
or attorneys-in-fact; and (iii) each "Family Controlled Entity" (as defined
herein). The term "Family Controlled Entity" means (a) any not-for-profit
corporation if at least 80% of its board of directors is composed of Mr. Smith,
Mr. Egan and/or Descendants; (b) any other corporation if at least 80% of the
value of its outstanding equity is owned by a Permitted Holder; (c) any
partnership if at least 80% of the value of the partnership interests are owned
by a Permitted Holder; (d) any limited liability or similar company if at least
80% of the value of the company is
-17-
owned by a Permitted Holder; and (e) any trusts created for the benefit of any
of the persons listed in (i) or (ii) of the prior sentence.
"Permitted Investment" means (i) Investments in any Wholly Owned
Restricted Subsidiary or any Person which, as a result of such Investment, (a)
becomes a Wholly Owned Restricted Subsidiary or (b) is merged or consolidated
with or into, or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or any Wholly Owned Restricted Subsidiary; (ii)
Indebtedness of the Company or a Restricted Subsidiary described under clauses
(v), (vi) and (vii) of the definition of "Permitted Indebtedness"; (iii)
Investments in any of the Securities; (iv) Temporary Cash Investments; (v)
Investments acquired by the Company or any Restricted Subsidiary in connection
with an Asset Sale permitted under Section 1012 herein to the extent such
Investments are non-cash proceeds as permitted under such covenant; (vi) any
Investment to the extent the consideration therefor consists of Qualified
Capital Stock of the Company or any Restricted Subsidiary; (vii) Investments
representing Capital Stock or obligations issued to the Company or any
Restricted Subsidiary in the ordinary course of the good faith settlement of
claims against any other Person by reason of a composition or readjustment of
debt or a reorganization of any debtor or any Restricted Subsidiary; (viii)
prepaid expenses advanced to employees in the ordinary course of business or
other loans or advances to employees in the ordinary course of business not to
exceed $1 million in the aggregate at any one time outstanding; (ix) Investments
in existence on the Issue Date; and (x) in addition to the Investments described
in clauses (i) through (x) above, Investments in an amount not to exceed $10
million in the aggregate at any one time outstanding. In connection with any
assets or property contributed or transferred to any Person as an Investment,
such property and assets shall be equal to the Fair Market Value (as determined
by the Company's Board of Directors) at the time of Investment.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 308 in exchange for a
mutilated Security or in lieu of a lost, destroyed or stolen Security shall be
deemed to evidence the same debt as the mutilated, lost, destroyed or stolen
Security.
"Preferred Stock" means, with respect to any Person, any 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 the
Capital Stock of any other class in such Person.
-18-
"Prospectus" means the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including any such
prospectus supplement with respect to the terms of the offering of any portion
of the Series A Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all material incorporated by reference
therein.
"Public Equity Offering" means an underwritten public offering of
common stock (other than Redeemable Capital Stock) of the Company with gross
proceeds to the Company of at least $50 million pursuant to a registration
statement that has been declared effective by the Commission pursuant to the
Securities Act (other than a registration statement on Form S-4, Form S-8 or
otherwise relating to equity securities issuable under any employee benefit plan
of the Company).
"Purchase Money Obligation" means any Indebtedness secured by a Lien
on assets related to the business of the Company and any additions and
accessions thereto, which are purchased by the Company at any time after the
Securities are issued; provided that (i) the security agreement or conditional
sales or other title retention contract pursuant to which the Lien on such
assets is created (collectively a "Purchase Money Security Agreement") shall be
entered into within 90 days after the purchase or substantial completion of the
construction of such assets and shall at all times be confined solely to the
assets so purchased or acquired, any additions and accessions thereto and any
proceeds therefrom, (ii) at no time shall the aggregate principal amount of the
outstanding Indebtedness secured thereby be increased, except in connection with
the purchase of additions and accessions thereto and except in respect of fees
and other obligations in respect of such Indebtedness and (iii) (A) the
aggregate outstanding principal amount of Indebtedness secured thereby
(determined on a per asset basis in the case of any additions and accessions)
shall not at the time such Purchase Money Security Agreement is entered into
exceed 100% of the purchase price to the Company of the assets subject thereto
or (B) the Indebtedness secured thereby shall be with recourse solely to the
assets so purchased or acquired, any additions and accessions thereto and any
proceeds therefrom.
"QIB" means a "Qualified Institutional Buyer" under Rule 144A under
the Securities Act.
"Qualified Capital Stock" of any Person means any and all Capital
Stock of such Person other than Redeemable Capital Stock.
-19-
"Redeemable Capital Stock" means any Capital Stock that,
either by its terms or by the terms of any security into which it
is convertible or exchangeable or otherwise, is or upon the
happening of an event or passage of time would be, required to be
redeemed prior to the final Stated Maturity of the principal of
the Securities or is redeemable at the option of the holder
thereof at any time prior to such final Stated Maturity (other
than upon a change of control of the Company in circumstances
where a Holder would have similar rights), or is convertible into
or exchangeable for debt securities at any time prior to any such
Stated Maturity at the option of the holder thereof.
"Redemption Date" when used with respect to any Security to
be redeemed pursuant to any provision in this Indenture means the
date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price" when used with respect to any Security to
be redeemed pursuant to any provision in this Indenture means the
price at which it is to be redeemed pursuant to this Indenture.
"Registration Rights Agreement" means the Registration
Rights Agreement, dated as of July 31, 1998, among the Company,
the Guarantors and the Initial Purchasers.
"Registration Statement" means any registration statement of
the Company and the Guarantors which covers any of the Series A
Securities (and related guarantees) or Series B Securities (and
related guarantees) pursuant to the provisions of the
Registration Rights Agreement, and all amendments and supplements
to any such Registration Statement, including post-effective
amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by
reference therein.
"Regular Record Date" for the interest payable on any
Interest Payment Date means the January 15 or July 15 (whether or
not a Business Day) next preceding such Interest Payment Date.
- 20 -
"Regulation S" means Regulation S under the Securities Act,
as amended from time to time.
"Regulation S Global Securities" means one or more permanent
global Securities in registered form representing the aggregate
principal amount of Securities sold in reliance on Regulation S
under the Securities Act.
"Responsible Officer" when used with respect to the Trustee
means any officer or employee assigned to the Corporate Trust
Office or any agent of the Trustee appointed hereunder, including
any vice president, assistant vice president, secretary,
assistant secretary, or any other officer or assistant officer of
the Trustee or any agent of the Trustee appointed hereunder to
whom any corporate trust matter is referred because of his or her
knowledge of and familiarity with the particular subject.
"Replacement Assets" means properties and assets (other than
cash or any Capital Stock or other security) that will be used in
a business of the Company or its Restricted Subsidiaries existing
on the Issue Date or in business reasonably related thereto.
"Restricted Subsidiary" means any Subsidiary of the Company
that has not been designated by the Board of Directors of the
Company by a Board Resolution delivered to the Trustee as an
Unrestricted Subsidiary pursuant to and in compliance with
Section 1018 herein.
"Revolving Facility" means the Credit Agreement among the
Company, the Guarantors and Ford Motor Credit Company as of
December 15, 1997, as such agreement, in whole or in part, may be
amended, renewed, extended, substituted, refinanced,
restructured, replaced, supplemented or otherwise modified from
time to time (including, without limitation, any successive
renewals, extensions, substitutions, refinancings,
restructurings, replacements, supplementations or other
modifications of the foregoing).
"Rule 144A" means Rule 144A under the Securities Act, as
amended from time to time.
"Rule 144A Global Securities" means one or more permanent
global Securities in registered form representing the aggregate
principal amount of Securities sold in reliance on Rule 144A
under the Securities Act.
"S&P" means Standard & Poor's Rating Group, a division of
McGraw Hill, Inc. or any successor rating agency.
-21-
"Securities Act" means the Securities Act of 1933, as
amended, or any successor statute and the rules and regulations
promulgated by the Commission thereunder.
"Senior Guarantor Indebtedness" means the principal of,
premium, if any, and interest (including interest, to the extent
allowable, accruing after the filing of a petition initiating any
proceeding under any state, federal or foreign bankruptcy law) on
any Indebtedness of any Guarantor (other than as otherwise
provided in this definition), whether outstanding on the Issue
Date or thereafter created, incurred or assumed, and whether at
any time owing, actually or contingent, unless, in the case of
any particular Indebtedness, the instrument creating or
evidencing the same or pursuant to which the same is outstanding
expressly provides that such Indebtedness shall not be senior in
right of payment to any Guarantee. Notwithstanding the foregoing,
"Senior Guarantor Indebtedness" shall (x) include the Floor Plan
Facility and the Revolving Facility to the extent any Guarantor
is a party thereto and (y) not include (i) Indebtedness evidenced
by the Guarantees, (ii) Indebtedness that is subordinated or
junior in right of payment to any Indebtedness of any Guarantor,
(iii) Indebtedness which when incurred and without respect to any
election under Section 1111(b) of Title 11 United States Code is
without recourse to any Guarantor, (iv) Indebtedness which is
represented by Redeemable Capital Stock, (v) any liability for
foreign, federal, state, local or other taxes owed or owing by
any Guarantor to the extent such liability constitutes
Indebtedness, (vi) Indebtedness of any Guarantor to a Subsidiary
or any other Affiliate of the Company or any of such Affiliate's
Subsidiaries, (vii) to the extent it might constitute
Indebtedness, amounts owing for goods, materials or services
purchased in the ordinary course of business or consisting of
trade accounts payable owed or owing by such Guarantor, and
amounts owed by such Guarantor for compensation to employees or
services rendered to such Guarantor, (viii) that portion of any
Indebtedness which at the time of issuance is issued in violation
of this Indenture and (ix) Indebtedness evidenced by any
guarantee of any Subordinated Indebtedness or Pari Passu
Indebtedness.
"Senior Indebtedness" means the principal of, premium, if
any, and interest (including interest, to the extent allowable,
accruing after the filing of a petition initiating any proceeding
under any state, federal or foreign bankruptcy law) on any
Indebtedness of the Company (other than as otherwise provided in
this definition), whether outstanding on the Issue Date or
thereafter created, incurred or assumed, and whether at any time
owing, actually or contingent, unless, in the case of any
particular Indebtedness, the instrument creating or evidencing
the same or pursuant to which the same is outstanding expressly
provides that such Indebtedness shall not be senior in right of
payment to the Notes. Notwithstanding the foregoing, "Senior
Indebtedness" shall (x) include the Floor Plan Facility and the
Revolving Facility to the extent the Company is a party thereto
and (y) not include (i) Indebtedness evidenced by the Securities,
(ii) Indebtedness that is subordinate or junior in right of
payment to any Indebtedness of the Company, (iii) Indebtedness
which when incurred and without respect to any election under
-22-
Section 1111(b) of Title 11 United States Code is without
recourse to the Company, (iv) Indebtedness which is represented
by Redeemable Capital Stock, (v) any liability for foreign,
federal, state, local or other taxes owed or owing by the Company
to the extent such liability constitutes Indebtedness, (vi)
Indebtedness of the Company to a Subsidiary or any other
Affiliate of the Company or any of such Affiliate's Subsidiaries,
(vii) to the extent it might constitute Indebtedness, amounts
owing for goods, materials or services purchased in the ordinary
course of business or consisting of trade accounts payable owed
or owing by the Company, and amounts owed by the Company for
compensation to employees or services rendered to the Company,
(viii) that portion of any Indebtedness which at the time of
issuance is issued in violation of this Indenture and (ix)
Indebtedness evidenced by any guarantee of any Subordinated
Indebtedness or Pari Passu Indebtedness.
"Senior Representative" means the agent, indenture trustee
or other trustee or representative for any Senior Indebtedness.
"Series B Global Securities" means one or more permanent
Global Securities in registered form representing the aggregate
principal amount of Series B Securities exchanged for Series A
Securities pursuant to the Exchange Offer.
"Shelf Registration Statement" means a "shelf" registration
statement of the Company and the Guarantors pursuant to Section
2.2 of the of the Registration Rights Agreement, which covers all
of the Registrable Securities (as defined in the Registration
Rights Agreement) on an appropriate form under Rule 415 under the
Securities Act, or any similar rule that may be adopted by the
Commission, and all amendments and supplements to such
registration statement, including post-effective amendments, in
each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference
therein.
"Significant Restricted Subsidiary" means, at any particular
time, any Restricted Subsidiary that, together with the
Restricted Subsidiaries of such Restricted Subsidiary (i)
accounted for more than 5% of the Consolidated revenues of the
Company and its Restricted Subsidiaries for their most recently
completed fiscal year or (ii) is or are the owner(s) of more than
5% of the Consolidated assets of the Company and its Restricted
Subsidiaries as at the end of such fiscal year, all as calculated
in accordance with GAAP and as shown on the Consolidated
financial statements of the Company and its Restricted
Subsidiaries for such fiscal year.
"Smith Subordinated Loan" means the subordinated loan from
Bruton Smith to the Company in the principal amount of $5.5
million in existence on the Issue Date.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section
309.
-23-
"Stated Maturity" means, when used with respect to any
Indebtedness or any installment of interest thereon, the dates
specified in such Indebtedness as the fixed date on which the
principal of such Indebtedness or such installment of interest,
as the case may be, is due and payable.
"Subordinated Indebtedness" means Indebtedness of the
Company or a Guarantor subordinated in right of payment to the
Securities or the Guarantee of such Guarantor, as the case may
be.
"Subsidiary" of a Person means (i) any corporation more than
50% of the outstanding voting power of the Voting Stock of which
is owned or controlled, directly or indirectly, by such Person or
by one or more other Subsidiaries of such Person, or by such
Person and one or more other Subsidiaries thereof, or (ii) any
limited partnership of which such Person or any Subsidiary of
such Person is a general partner, or (iii) any other Person in
which such Person, or one or more other Subsidiaries of such
Person, or such Person and one or more other Subsidiaries,
directly or indirectly, has more than 50% of the outstanding
partnership or similar interests or has the power, by contract or
otherwise, to direct or cause the direction of the policies,
management and affairs thereof.
"Successor Security" of any particular Security means every
Security issued after, and evidencing all or a portion of the
same debt as that evidenced by, such particular Security; and,
for the purposes of this definition, any Security authenticated
and delivered under Section 307 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or
stolen Security.
"Temporary Cash Investments" means (i) any evidence of
Indebtedness, maturing not more than one year after the date of
acquisition, issued by the United States of America, or an
instrumentality or agency thereof, and guaranteed fully as to
principal, premium, if any, and interest by the United States of
America, (ii) any certificate of deposit, maturing not more than
one year after the date of acquisition, issued by, or time
deposit of, a commercial banking institution that is a member of
the Federal Reserve System and that has combined capital and
surplus and undivided profits of not less than $500 million,
whose debt has a rating, at the time as of which any investment
therein is made, of "P-1" (or higher) according to Moody's or any
successor rating agency or "A-1" (or higher) according to S&P or
any successor rating agency, (iii) commercial paper, maturing not
more than one year after the date of acquisition, issued by a
corporation (other than an Affiliate or Subsidiary of the
Company) organized and existing under the laws of the United
States of America with a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to
Moody's or "A-1" (or higher) according to S&P, and (iv) any money
market deposit accounts issued or offered by a domestic
commercial bank having capital and surplus in excess of $500
million; provided
-24-
that the short term debt of such commercial bank has a rating, at
the time of Investment, of "P-1" (or higher) according to Moody's
or "A-1" (or higher) according to S&P.
"Trustee" means the Person named as the "Trustee" in the
first paragraph of this Indenture, until a successor trustee
shall have become such pursuant to the applicable provisions of
this Indenture, and thereafter "Trustee" shall mean such
successor trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended, or any successor statute.
"Unrestricted Subsidiary" means any Subsidiary of the
Company (other than a Guarantor) designated as such pursuant to
and in compliance with Section 1018 herein.
"Unrestricted Subsidiary Indebtedness" of any Unrestricted
Subsidiary means Indebtedness of such Unrestricted Subsidiary (i)
as to which neither the Company nor any Restricted Subsidiary is
directly or indirectly liable (by virtue of the Company or any
such Subsidiary being the primary obligor on, guarantor of, or
otherwise liable in any respect to, such Indebtedness), except
Guaranteed Debt of the Company or any Restricted Subsidiary to
any Affiliate, in which case (unless the incurrence of such
Guaranteed Debt resulted in a Restricted Payment at the time of
incurrence) the Company shall be deemed to have made a Restricted
Payment equal to the principal amount of any such Indebtedness to
the extent guaranteed at the time such Affiliate is designated an
Unrestricted Subsidiary and (ii) which, upon the occurrence of a
default with respect thereto, does not result in, or permit any
holder of any Indebtedness of the Company or any Subsidiary to
declare, a default on such Indebtedness of the Company or any
Subsidiary or cause the payment thereof to be accelerated or
payable prior to its Stated Maturity; provided that
notwithstanding the foregoing any Unrestricted Subsidiary may
guarantee the Securities.
"Voting Stock" means Capital Stock of the class or classes
pursuant to which the holders thereof have the general voting
power under ordinary circumstances to elect at least a majority
of the board of directors, managers or trustees of such Person
(irrespective of whether or not at the time Capital Stock of any
other class or classes shall have or might have voting power by
reason of the happening of any contingency).
"Wholly Owned Restricted Subsidiary" means a Restricted
Subsidiary all the Capital Stock of which (other than directors'
qualifying shares and shares of Capital Stock of a Restricted
Subsidiary which a Manufacturer requires to be held by another
Person and which Capital Stock (together with any related
contractual arrangements) has no significant economic value (with
respect to distributions of profits or losses in ordinary
circumstances) is owned by the Company or another Wholly Owned
Restricted Subsidiary (other than directors' qualifying shares).
-25-
Section 102. Other Definitions.
Term Defined in Section
---- ------------------
"Act" 105
"Agent Members" 306
"Change of Control Offer" 1014
"Change of Control Purchase Date" 1014
"Change of Control Purchase Notice" 1014
"Change of Control Purchase Price" 1014
"covenant defeasance" 403
"Defaulted Interest" 309
"defeasance" 402
"Defeasance Redemption Date" 404
"Defeased Securities" 401
"Excess Proceeds" 1012
"incur" 1008
"Offer" 1012
"Offer Date" 1012
"Offered Price" 1012
"Pari Passu Debt Amount" 1012
"Pari Passu Offer" 1012
"Permitted Indebtedness" 1008
"Permitted Payment" 1009
"Private Placement Legend" 202
"Purchase Money Security Agreement" 101
"refinancing" 1008
"Required Filing Date" 1019
"Restricted Payments" 1009
"Securities" Recitals
"Security Amount" 1012
"Security Register" 305
"Security Registrar" 305
"Series A Securities" Recitals
"Series B Securities" Recitals
"Special Payment Date" 309
"Surviving Entity" 801
"Surviving Guarantor Entity" 801
"U.S. Government Obligations" 404
Section 103. Compliance Certificates and Opinions.
------------------------------------
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture and as may be requested
by the Trustee, the
-26-
Company and any Guarantor (if applicable) and any other obligor on the
Securities (if applicable) shall furnish to the Trustee an Officers' Certificate
in a form and substance reasonably acceptable to the Trustee stating that all
conditions precedent, if any, provided for in this Indenture (including any
covenant compliance with which constitutes a condition precedent) relating to
the proposed action have been complied with, and an Opinion of Counsel in a form
and substance reasonably acceptable to the Trustee stating that in the opinion
of such counsel all such conditions precedent, if any, have been complied with,
except that, in the case of any such application or request as to which the
furnishing of such certificates or opinions is specifically required by any
provision of this Indenture relating to such particular application or request,
no additional certificate or opinion need be furnished.
Every certificate or Opinion of Counsel with respect to compliance
with a condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate or
individual or firm signing such opinion has read and understands such covenant
or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual or such
firm, he or it has made such examination or investigation as is necessary to
enable him or it to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual or such firm, such condition or covenant has been complied with.
Section 104. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
-27-
Any certificate of an officer of the Company, any Guarantor or other
obligor on the Securities may be based, insofar as it relates to legal matters,
upon a certificate or opinion of, or representations by, counsel, unless such
officer has actual knowledge that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion may be based, insofar as it relates
to factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company, any Guarantor or other obligor on the
Securities stating that the information with respect to such factual matters is
in the possession of the Company, any Guarantor or other obligor on the
Securities, unless such officer or counsel has actual knowledge that the
certificate or opinion or representations with respect to such matters are
erroneous. Opinions of Counsel required to be delivered to the Trustee may have
qualifications customary for opinions of the type required and counsel
delivering such Opinions of Counsel may rely on certificates of the Company or
government or other officials customary for opinions of the type required,
including certificates certifying as to matters of fact, including that various
financial covenants have been complied with.
Any certificate or opinion of an officer of the Company, any Guarantor or
other obligor on the Securities may be based, insofar as it relates to
accounting matters, upon a certificate or opinion of, or representations by, an
accountant or firm of accountants in the employ of the Company, unless such
officer has actual knowledge that the certificate or opinion or representations
with respect to the accounting matters upon which his certificate or opinion may
be based are erroneous. Any certificate or opinion of any independent firm of
public accountants filed with the Trustee shall contain a statement that such
firm is independent with respect to the Company.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 105. Acts of Holders.
---------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such
-28-
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and conclusive in favor of the Trustee and the
Company, if made in the manner provided in this Section 105.
(b) The ownership of Securities shall be proved by the Security
Register.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other Act by the Holder of any Security shall bind every future Holder
of the same Security or the Holder of every Security issued upon the transfer
thereof or in exchange therefor or in lieu thereof, in respect of anything done,
suffered or omitted to be done by the Trustee, any Paying Agent or the Company,
any Guarantor or any other obligor of the Securities in reliance thereon,
whether or not notation of such action is made upon such Security.
(d) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(e) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Company may, at its option, by or pursuant to a Board Resolution, fix in advance
a record date for the determination of such Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so. Notwithstanding Trust
Indenture Act Section 316(c), any such record date shall be the record date
specified in or pursuant to such Board Resolution, which shall be a date not
more than 30 days prior to the first solicitation of Holders generally in
connection therewith and no later than the date such first solicitation is
completed.
If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or after
such record date, but only the Holders of record at the close of business on
such record date shall be deemed to be Holders for purposes of determining
whether Holders of the requisite proportion of Securities then Outstanding have
authorized or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other Act, and for this purpose the
Securities then Outstanding shall be computed as of such record date; provided
that no such request, demand, authorization, direction, notice, consent, waiver
or other Act by the Holders on such record date shall
-29-
be deemed effective unless it shall become effective pursuant to the provisions
of this Indenture not later than six months after such record date.
(f) For purposes of this Indenture, any action by the Holders which
may be taken in writing may be taken by electronic means or as otherwise
reasonably acceptable to the Trustee.
Section 106. Notices, etc., to the Trustee, the Company and any Guarantor.
------------------------------------------------------------
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:
(a) the Trustee by any Holder or by the Company or any Guarantor or
any other obligor on the Securities shall be sufficient for every purpose
(except as provided in Section 501(c)) hereunder if in writing and mailed,
first-class postage prepaid, or delivered by recognized overnight courier, to or
with the Trustee at its Corporate Trust Office, or at any other address
previously furnished in writing to the Holders or the Company, any Guarantor or
any other obligor on the Securities by the Trustee; or
(b) the Company or any Guarantor by the Trustee or any Holder shall
be sufficient for every purpose (except as provided in Section 501(c)) hereunder
if in writing and mailed, first-class postage prepaid, or delivered by
recognized overnight courier, to the Company or such Guarantor addressed to it
c/o Sonic Automotive, Inc., 5401 East Independence Boulevard, Charlotte, North
Carolina 28218, Attention: Chief Financial Officer or at any other address
previously furnished in writing to the Trustee by the Company or such Guarantor.
Section 107. Notice to Holders; Waiver.
-------------------------
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, or delivered by
recognized overnight courier, to each Holder affected by such event, at its
address as it appears in the Security Register, not later than the latest date,
and not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Any notice when mailed to a Holder in the aforesaid manner shall
be conclusively deemed to
-30-
have been received by such Holder whether or not actually received by such
Holder. Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause, it shall be impracticable to mail notice of any event
as required by any provision of this Indenture, then any method of giving such
notice as shall be reasonably satisfactory to the Trustee shall be deemed to be
a sufficient giving of such notice.
Section 108. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with any
provision of the Trust Indenture Act or another provision which is required or
deemed to be included in this Indenture by any of the provisions of the Trust
Indenture Act, the provision or requirement of the Trust Indenture Act shall
control. If any provision of this Indenture modifies or excludes any provision
of the Trust Indenture Act that may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or to be
excluded, as the case may be.
Section 109. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
Section 110. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company and
the Guarantors shall bind their respective successors and assigns, whether so
expressed or not.
Section 111. Separability Clause.
-------------------
In case any provision in this Indenture or in the Securities or
Guarantees shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 112. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Securities or Guarantees,
express or implied, shall give to any Person (other than the parties hereto and
their successors hereunder, any Paying Agent and the Holders) any benefit or any
legal or equitable right, remedy or claim under this Indenture.
-31-
SECTION 113. GOVERNING LAW.
-------------
THIS INDENTURE, THE SECURITIES AND THE GUARANTEES SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
Section 114. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date,
Maturity or Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal or premium, if any, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on such Interest Payment Date or Redemption Date, or at
the Maturity or Stated Maturity and no interest shall accrue with respect to
such payment for the period from and after such Interest Payment Date,
Redemption Date, Maturity or Stated Maturity, as the case may be, to the next
succeeding Business Day.
Section 115. Independence of Covenants.
-------------------------
All covenants and agreements in this Indenture shall be given
independent effect so that if a particular action or condition is not permitted
by any such covenants, the fact that it would be permitted by an exception to,
or be otherwise within the limitations of, another covenant shall not avoid the
occurrence of a Default or an Event of Default if such action is taken or
condition exists.
Section 116. Schedules and Exhibits.
----------------------
All schedules and exhibits attached hereto are by this reference
made a part hereof with the same effect as if herein set forth in full.
Section 117. Counterparts.
------------
This Indenture may be executed in any number of counterparts, each
of which shall be deemed an original; but all such counterparts shall together
constitute but one and the same instrument.
ARTICLE TWO
SECURITY FORMS
Section 201. Forms Generally.
---------------
-32-
The Securities, the Guarantees and the Trustee's certificate of
authentication thereon shall be in substantially the forms set forth in this
Article Two, with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted hereby and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange,
any organizational document or governing instrument or applicable law or as may,
consistently herewith, be determined by the officers executing such Securities
and Guarantees, as evidenced by their execution of the Securities and
Guarantees. Any portion of the text of any Security may be set forth on the
reverse thereof, with an appropriate reference thereto on the face of the
Security.
The definitive Securities shall be printed, lithographed or engraved
or produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Securities
may be listed, all as determined by the officers executing such Securities, as
evidenced by their execution of such Securities.
Initial Securities offered and sold in reliance on Rule 144A shall
be issued initially in the form of one or more Rule 144A Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary, or its nominee, in each case for credit to an account of a direct or
indirect participant of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Rule 144A Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary or its nominee, as hereinafter provided.
Initial Securities offered and sold in reliance on Regulation S
shall be issued in the form of one or more Regulation S Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary, or its nominee in each case for credit by the Depositary to an
account of a direct or indirect participant of the Depositary, duly executed by
the Company and authenticated by the Trustee as hereinafter provided; provided,
however, that upon such deposit through and including the 40th day after the
later of the commencement of the Offering and the original issue date of the
Securities (such period through and including such 40th day, the "Restricted
Period"), all such Securities shall be credited to or through accounts
maintained at the Depositary by or on behalf of Euroclear or Cedel unless
exchanged for interests in the Rule 144A Global Securities in accordance with
the transfer and certification requirements described below. The aggregate
principal amount of the Regulation S Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
-33-
Series B Securities exchanged for Series A Securities shall be
issued initially in the form of one or more Series B Global Securities,
substantially in the form set forth in Section 202, deposited upon issuance with
the Trustee, as custodian for the Depositary, registered in the name of the
Depositary or its nominee, in each case for credit to an account of a direct or
indirect participant of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Series B Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary or its nominee, as hereinafter provided.
Section 202. Form of Face of Security.
------------------------
(a) The form of the face of any Series A Securities authenticated
and delivered hereunder shall be substantially as follows:
Unless and until (i) an Initial Security is sold under an effective
Registration Statement or (ii) an Initial Security is exchanged for a Series B
Security in connection with an effective Registration Statement, in each case
pursuant to the Registration Rights Agreement, then such Initial Security shall
bear the legend set forth below (the "Private Placement Legend") on the face
thereof:
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED
OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION AS SET FORTH BELOW.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS
A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A")) OR (B) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION, (2) AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE
WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF
AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE
COMPANY WAS
-34-
THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY)
ONLY (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR
SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A INSIDE THE UNITED STATES, TO A PERSON IT REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) OUTSIDE THE UNITED STATES
PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS IN AN OFFSHORE
TRANSACTION WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES
ACT, OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE
COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
TRANSFER (I) PURSUANT TO CLAUSES (D) OR (E) TO REQUIRE THE DELIVERY
OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE FOREGOING
CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. AS USED HEREIN, THE
TERMS "UNITED STATES," "OFFSHORE TRANSACTION," AND "U.S. PERSON"
HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY.
TRANSFERS OF THIS
-35-
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307 OF THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT AND ANY SUCH CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE OBLIGATIONS EVIDENCED HEREBY ARE SUBORDINATE IN THE MANNER AND
TO THE EXTENT SET FORTH IN ARTICLE FOURTEEN OF THE INDENTURE TO THE
OBLIGATIONS (INCLUDING INTEREST) OWED BY THE COMPANY AND CERTAIN OF
ITS SUBSIDIARIES TO ALL SENIOR INDEBTEDNESS; AND EACH HOLDER HEREOF
BY ITS ACCEPTANCE HEREOF, SHALL BE BOUND BY THE PROVISIONS OF THE
SUBORDINATION AS SET FORTH IN SAID ARTICLE FOURTEEN OF THE
INDENTURE."
-36-
SONIC AUTOMOTIVE, INC.
------------------
11% SENIOR SUBORDINATED NOTE DUE 2008, SERIES A
CUSIP NO.
83545GAA0
No. 1 $125,000,000
Sonic Automotive, Inc., a Delaware corporation (herein called the
"Company," which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
___________ or registered assigns, the principal sum of $125,000,000 United
States dollars on August 1, 2008, at the office or agency of the Company
referred to below, and to pay interest thereon from July 31, 1998, or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for, semiannually on February 1 and August 1 in each year, commencing
February 1, 1999 at the rate of 11% per annum, subject to adjustments as
described in the second following paragraph, in United States dollars, until the
principal hereof is paid or duly provided for. Interest shall be computed on the
basis of a 360-day year comprised of twelve 30-day months.
The Holder of this Series A Security is entitled to the benefits of
the Registration Rights Agreement among the Company, the Guarantors and the
Initial Purchasers, dated July 31, 1998, pursuant to which, subject to the terms
and conditions thereof, the Company and the Guarantors are obligated to
consummate the Exchange Offer pursuant to which the Holder of this Security (and
related Guarantees) shall have the right to exchange this Security (and related
Guarantees) for 11% Senior Subordinated Notes due 2008, Series B and related
Guarantees (herein called the "Series B Securities") in like principal amount as
provided therein. The Series A Securities and the Series B Securities are
together (including related Guarantees) referred to as the "Securities." The
Series A Securities rank pari passu in right of payment with the Series B
Securities.
In the event that (a) the Exchange Offer Registration Statement is
not filed with the Commission on or prior to the 60th calendar day following the
date of original issue of the Series A Securities, (b) the Exchange Offer
Registration Statement has not been declared effective on or prior to the 135th
calendar day following the date of original issue of the Series A Securities,
(c) the Exchange Offer is not consummated or a Shelf Registration Statement is
not declared effective, in either case, on or prior to the 165th calendar day
following the date of original issue of the Series A Securities or
(d) the Shelf Registration Statement is declared effective but shall thereafter
become unusable for more than 30 days in the aggregate (each such event referred
to in clauses (a) through (d) above, a "Registration Default"), the interest
rate borne by the Series A
-37-
Securities shall be increased by one-quarter of one percent per annum upon the
occurrence of each Registration Default, which rate (as increased aforesaid)
will increase by an additional one quarter of one percent each 90-day period
that such additional interest continues to accrue under any such circumstance,
with an aggregate maximum increase in the interest rate equal to one percent
(1%) per annum. The Shelf Registration Statement will be required to remain
effective until the second anniversary of the Series A Securities. Following the
cure of all Registration Defaults, the accrual of additional interest will cease
and the interest rate will revert to the original rate.
The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or any Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest, which
shall be the January 15 or July 15 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date. Any such interest not so
punctually paid, or duly provided for, and interest on such defaulted interest
at the interest rate borne by the Series A Securities, to the extent lawful,
shall forthwith cease to be payable to the Holder on such Regular Record Date,
and may either be paid to the Person in whose name this Security (or any
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such defaulted interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by this Indenture not inconsistent with the requirements of such exchange, all
as more fully provided in this Indenture.
Payment of the principal of, premium, if any, and interest on, this
Security, and exchange or transfer of the Security, will be made at the office
or agency of the Company in The City of New York maintained for that purpose
(which initially will be a corporate trust office of the Trustee located at 100
Wall Street, 20th Floor, New York, New York, 10005), or at such other office or
agency as may be maintained for such purpose, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that payment of interest may be
made at the option of the Company by check mailed to the address of the Person
entitled thereto as such address shall appear on the Security Register.
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.
This Security is entitled to the benefits of the Guarantees by the
Guarantors of the punctual payment when due and performance of the Indenture
Obligations made in
-38-
favor of the Trustee for the benefit of the Holders. Reference is made to
Article Thirteen of the Indenture for a statement of the respective rights,
limitations of rights, duties and obligations under the Guarantees of the
Guarantors.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof or by the
authenticating agent appointed as provided in the Indenture by manual signature
of an authorized signer, this Security shall not be entitled to any benefit
under the Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed by the manual or facsimile signature of its authorized officers.
Sonic Automotive, Inc.
By:______________________________________
Name:
Title:
Attest:
_________________________________
Name:
Title:
-39-
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 11% Senior Subordinated Notes due 2008, Series A
referred to in the within-mentioned Indenture.
U.S Bank Trust National Association,
as Trustee
By: _________________________________
Authorized Signer
Dated:
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company pursuant
to Section 1012 or Section 1014, as applicable, of the Indenture, check the Box:
[ ].
If you wish to have a portion of this Security purchased by the
Company pursuant to Section 1012 or Section 1014 as applicable, of the
Indenture, state the amount (in original principal amount):
$ ________________
Your
Date: ____________________________ Signature:___________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:________________________________________
-40-
[Signature must be guaranteed by an eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and credit unions) with membership in an
approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
(b) The form of the face of any Series B Securities authenticated
and delivered hereunder shall be substantially as follows:
[Legend if Security is a Global Security]
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307
OF THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT AND ANY SUCH CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE OBLIGATIONS EVIDENCED HEREBY ARE SUBORDINATE IN THE MANNER AND
TO THE EXTENT
-41-
SET FORTH IN ARTICLE FOURTEEN OF THE INDENTURE TO THE OBLIGATIONS
(INCLUDING INTEREST) OWED BY THE COMPANY AND CERTAIN OF ITS
SUBSIDIARIES TO ALL SENIOR INDEBTEDNESS; AND EACH HOLDER HEREOF BY
ITS ACCEPTANCE HEREOF, SHALL BE BOUND BY THE PROVISIONS OF THE
SUBORDINATION AS SET FORTH IN SAID ARTICLE FOURTEEN OF THE
INDENTURE."
-42-
Sonic Automotive, Inc.
------------------
11% SENIOR SUBORDINATED NOTE DUE 2008, SERIES B
CUSIP NO.
83545GAB8
No. __________ $_____________________
Sonic Automotive, Inc., a Delaware corporation (herein called the
"Company," which term includes any successor Person under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
______________________ or registered assigns, the principal sum of
_____________________ United States dollars on August 1, 2008, at the office or
agency of the Company referred to below, and to pay interest thereon from July
31, 1998, or from the most recent Interest Payment Date to which interest has
been paid or duly provided for, semiannually on February 1 and July 1 in each
year, commencing February 1, 1999 at the rate of 11% per annum, in United States
dollars, until the principal hereof is paid or duly provided for; provided that
to the extent interest has not been paid or duly provided for with respect to
the Series A Security exchanged for this Series B Security, interest on this
Series B Security shall accrue from the most recent Interest Payment Date to
which interest on the Series A Security which was exchanged for this Series B
Security has been paid or duly provided for. Interest shall be computed on the
basis of a 360-day year comprised of twelve 30-day months.
This Series B Security was issued pursuant to the Exchange Offer
pursuant to which the 11% Senior Subordinated Notes due 2008, Series A and
related Guarantees (herein called the "Series A Securities") in like principal
amount were exchanged for the Series B Securities and related Guarantees. The
Series B Securities rank pari passu in right of payment with the Series A
Securities.
In addition, for any period in which the Series A Security exchanged
for this Series B Security was outstanding, in the event that (a) the Exchange
Offer Registration Statement is not filed with the Commission on or prior to the
30th calendar day following the date of original issue of the Series A Security,
(b) the Exchange Offer Registration Statement has not been declared effective on
or prior to the 135th calendar day following the date after the original issue
of the Series A Security, (c) the Exchange Offer is not consummated or a Shelf
Registration Statement is not declared effective, in either case, on or prior to
the 135th calendar day following the date of original issue of the Series A
Security or (d) the Shelf Registration Statement is declared effective but shall
thereafter become unusable for more than 30 days in the aggregate (each such
event referred to in clauses (a) through (d) above, a "Registration Default"),
the interest rate borne by the Series A Securities shall be increased by
one-quarter of one percent per
-43-
annum upon the occurrence of each Registration Default, which rate (as increased
as aforesaid) will increase by an additional one quarter of one percent each
90-day period that such additional interest continues to accrue under any such
circumstance, with an aggregate maximum increase in the interest rate equal to
one percent (1%) per annum. The Shelf Registration Statement will be required to
remain effective until the second anniversary of the Securities. Following the
cure of all Registration Defaults the accrual of additional interest will cease
and the interest rate will revert to the original rate; provided that, to the
extent interest at such increased interest rate has been paid or duly provided
for with respect to the Series A Security, interest at such increased interest
rate, if any, on this Series B Security shall accrue from the most recent
Interest Payment Date to which such interest on the Series A Security has been
paid or duly provided for; provided, however, that, if after any such reduction
in interest rate, a different event specified in clause (a), (b), (c) or (d)
above occurs, the interest rate shall again be increased pursuant to the
foregoing provisions.
The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or any Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest, which
shall be the January 15 or July 15 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date. Any such interest not so
punctually paid, or duly provided for, and interest on such defaulted interest
at the interest rate borne by the Series B Securities, to the extent lawful,
shall forthwith cease to be payable to the Holder on such Regular Record Date,
and may either be paid to the Person in whose name this Security (or any
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such defaulted interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in this Indenture.
Payment of the principal of, premium, if any, and interest on, this
Security, and exchange or transfer of the Security, will be made at the office
or agency of the Company in The City of New York maintained for such purpose
(which initially will be a corporate trust office of the Trustee located at 100
Wall Street, 20th Floor, New York, New York, 10005, or at such other office or
agency as may be maintained for such purpose, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that payment of interest may be
made at the option of the Company by check mailed to the address of the Person
entitled thereto as such address shall appear on the Security Register.
-44-
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.
This Security is entitled to the benefits of the Guarantees by the
Guarantors of the punctual payment when due and performance of the Indenture
Obligations made in favor of the Trustee for the benefit of the Holders.
Reference is made to Article Thirteen of the Indenture for a statement of the
respective rights, limitations of rights, duties and obligations under the
Guarantees of the Guarantors.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof or by the
authenticating agent appointed as provided in the Indenture by manual signature
of an authorized signer, this Security shall not be entitled to any benefit
under the Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed by the manual or facsimile signature of its authorized officers.
Sonic Automotive, Inc.
By:__________________________________
Title:_______________________________
Attest:
- --------------------------------
Authorized Officer
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 11% Senior Subordinated Notes due 2008, Series B
referred to in the within-mentioned Indenture.
U.S. Bank Trust National Association,
as Trustee
-45-
By: _________________________________
Authorized Signer
Dated:
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company pursuant
to Section 1012 or Section 1014, as applicable, of the Indenture, check the Box:
[ ].
-46-
If you wish to have a portion of this Security purchased by the
Company pursuant to Section 1012 or Section 1014 as applicable, of the
Indenture, state the amount (in original principal amount):
$ ___________________
Your
Date:_______________________________ Signature:__________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:_____________________________________
[Signature must be guaranteed by an eligible Guarantor Institution (banks, stock
brokers, savings and loan associations and credit unions) with membership in an
approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
Section 203. Form of Reverse of Securities.
-----------------------------
(a) The form of the reverse of the Series A Securities shall be
substantially as follows:
Sonic Automotive, Inc.
11% Senior Subordinated Note due 2008, Series A
This Security is one of a duly authorized issue of Securities of the
Company designated as its 11% Senior Subordinated Notes due 2008, Series A
(herein called the "Securities"), limited (except as otherwise provided in the
Indenture referred to below) in aggregate principal amount to $125,000,000,
issued under and subject to the terms of an indenture (herein called the
"Indenture") dated as of July 1, 1998, among the Company, the Guarantors and
U.S. Bank Trust National Association, as trustee (herein called the "Trustee,"
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties, obligations
and immunities thereunder of the Company, the Guarantors, the Trustee and the
Holders of the Securities, and of the terms upon which the Securities are, and
are to be, authenticated and delivered.
-47-
The Securities are subject to redemption at any time on or after
August 1, 2003, at the option of the Company, in whole or in part, on not less
than 30 nor more than 60 days' prior notice, in amounts of $1,000 or an integral
multiple thereof, at the following redemption prices (expressed as percentages
of the principal amount), if redeemed during the 12-month period beginning
August 1 of the years indicated below:
Redemption
Year Price
- ----
2003........................... 105.50%
2004........................... 103.667%
2005........................... 101.833%
and thereafter at 100% of the principal amount, in each case, together with
accrued and unpaid interest, if any, to the Redemption Date (subject to the
rights of Holders of record on relevant record dates to receive interest due on
an Interest Payment Date).
In addition, at any time on or prior to August 1, 2001, the Company
may, at its option, use the net proceeds of one or more Public Equity Offerings
to redeem up to an aggregate of 35% of the aggregate principal amount of
Securities originally issued under the Indenture at a redemption price equal to
111% of the aggregate principal amount thereof, plus accrued and unpaid interest
thereon, if any, to the Redemption Date; provided that at least 65% aggregate
principal amount the of Securities initially issued remains outstanding
immediately after the occurrence of such redemption. In order to effect the
foregoing redemption, the Company must mail a notice of redemption no later than
30 days after the closing of the related Public Equity Offering and must
consummate such redemption within 60 days of the closing of the Public Equity
Offering.
If less than all of the Securities are to be redeemed, the Trustee
shall select the Securities or portions thereof to be redeemed pro rata, by lot
or by any other method the Trustee shall deem fair and reasonable.
Upon the occurrence of a Change of Control, each Holder may require
the Company to purchase such Holder's Securities in whole or in part in integral
multiples of $1,000, at a purchase price in cash in an amount equal to 101% of
the principal amount thereof, plus accrued and unpaid interest, if any, to the
date of purchase, pursuant to a Change of Control Offer in accordance with the
procedures set forth in the Indenture.
Under certain circumstances, in the event the Net Cash Proceeds
received by the Company from any Asset Sale, which proceeds are not used to
repay permanently any Senior Indebtedness or Senior Guarantor Indebtedness or
invested in Replacement Assets or exceeds a specified amount the Company will be
required to apply such proceeds to the repayment of the Securities and certain
Indebtedness ranking pari passu in right of payment to the Securities.
-48-
In the case of any redemption or repurchase of Securities in
accordance with the Indenture, interest installments whose Stated Maturity is on
or prior to the Redemption Date will be payable to the Holders of such
Securities of record as of the close of business on the relevant Regular Record
Date or Special Record Date referred to on the face hereof. Securities (or
portions thereof) for whose redemption and payment provision is made in
accordance with the Indenture shall cease to bear interest from and after the
Redemption Date.
In the event of redemption or repurchase of this Security in
accordance with the Indenture in part only, a new Security or Securities for the
unredeemed portion hereof shall be issued in the name of the Holder hereof upon
the cancellation hereof.
If an Event of Default shall occur and be continuing, the principal
amount of all the Securities may be declared due and payable in the manner and
with the effect provided in the Indenture.
The Indenture contains provisions for defeasance at any time of (a)
the entire Indebtedness on the Securities and (b) certain restrictive covenants
and related Defaults and Events of Default, in each case upon compliance with
certain conditions set forth therein.
The Indenture permits, with certain exceptions (including certain
amendments permitted without the consent of any Holders and certain amendments
which require the consent of all the Holders) as therein provided, the amendment
thereof and the modification of the rights and obligations of the Company and
the Guarantors and the rights of the Holders under the Indenture and the
Securities and the Guarantees at any time by the Company and the Trustee with
the consent of the Holders of at least a majority in aggregate principal amount
of the Securities at the time Outstanding. The Indenture also contains
provisions permitting the Holders of at least a majority in aggregate principal
amount of the Securities (100% of the Holders in certain circumstances) at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company and the Guarantors with certain provisions of the
Indenture and the Securities and the Guarantees and certain past Defaults under
the Indenture and the Securities and the Guarantees and their consequences. Any
such consent or waiver by or on behalf of the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or
in exchange herefor or in lieu hereof whether or not notation of such consent or
waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, any Guarantor or any other obligor on the Securities (in the event such
Guarantor or such other obligor is obligated to make payments in respect of the
Securities), which is absolute and
-49-
unconditional, to pay the principal of, premium, if any, and interest on, this
Security at the times, place, and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in the Borough of Manhattan, The City of New
York, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or its attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
Certificated securities shall be transferred to all beneficial
holders in exchange for their beneficial interests in the Rule 144A Global
Securities or the Regulation S Global Securities if (x) the Depositary notifies
the Company that it is unwilling or unable to continue as Depositary for such
Global Security and a successor Depositary is not appointed by the Company
within 90 days or (y) there shall have occurred and be continuing an Event of
Default and the Security Registrar has received a request from the Depositary.
Upon any such issuance, the Trustee is required to register such certificated
Series A Securities in the name of, and cause the same to be delivered to, such
Person or Persons (or the nominee of any thereof). All such certificated Series
A Securities would be required to include the Private Placement Legend.
Series A Securities in certificated form are issuable only in
registered form without coupons in denominations of $1,000 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, the Series A Securities are exchangeable for a
like aggregate principal amount of Securities of a differing authorized
denomination, as requested by the Holder surrendering the same.
At any time when the Company is not subject to Sections 13 or 15(d)
of the Exchange Act, upon the written request of a Holder of a Series A
Security, the Company will promptly furnish or cause to be furnished such
information as is specified pursuant to Rule 144A(d)(4) under the Securities Act
(or any successor provision thereto) to such Holder or to a prospective
purchaser of such Series A Security who such Holder informs the Company is
reasonably believed to be a "Qualified Institutional Buyer" within the meaning
of Rule 144A under the Securities Act, as the case may be, in order to permit
compliance by such Holder with Rule 144A under the Securities Act.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, any Guarantor, the Trustee and any agent of the Company,
any Guarantor or
-50-
the Trustee may treat the Person in whose name this Security is registered as
the owner hereof for all purposes, whether or not this Security is overdue, and
neither the Company, any Guarantor, the Trustee nor any such agent shall be
affected by notice to the contrary.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES THEREOF.
All terms used in this Security which are defined in the Indenture
and not otherwise defined herein shall have the meanings assigned to them in the
Indenture.
[The Transferee Certificate, in the form of Appendix I hereto, will
be attached to the Series A Security.]
(b) The form of the reverse of the Series B Securities shall be
substantially as follows:
Sonic Automotive, Inc.
11% Senior Subordinated Note due 2008, Series B
This Security is one of a duly authorized issue of Securities of the
Company designated as its 11% Senior Subordinated Notes due 2008, Series B
(herein called the "Securities"), limited (except as otherwise provided in the
Indenture referred to below) in aggregate principal amount to $125,000,000,
issued under and subject to the terms of an indenture (herein called the
"Indenture") dated as of July 1, 1998, among the Company, the Guarantors and
U.S. Bank Trust National Association, as trustee (herein called the "Trustee,"
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties, obligations
and immunities thereunder of the Company, the Guarantors, the Trustee and the
Holders of the Securities, and of the terms upon which the Securities are, and
are to be, authenticated and delivered.
-51-
The Securities are subject to redemption at any time on or after
August 1, 2003, at the option of the Company, in whole or in part, on not less
than 30 nor more than 60 days' prior notice, in amounts of $1,000 or an integral
multiple thereof, at the following redemption prices (expressed as percentages
of the principal amount), if redeemed during the 12-month period beginning
August of the years indicated below:
Redemption
Year Price
- ---- --------------
2003........................... 105.50%
2004........................... 103.667%
2005........................... 101.833%
and thereafter at 100% of the principal amount, in each case, together with
accrued and unpaid interest, if any, to the Redemption Date (subject to the
rights of Holders of record on relevant record dates to receive interest due on
an Interest Payment Date).
In addition, at any time on or prior to August 1, 2001, the Company
may, at its option, use the net proceeds of one or more Public Equity Offerings
to redeem up to an aggregate of 35% of the aggregate principal amount of
Securities originally issued under the Indenture at a redemption price equal to
111% of the aggregate principal amount thereof, plus accrued and unpaid interest
thereon, if any, to the Redemption Date; provided that at least 65% aggregate
principal amount of the Securities initially issued remains outstanding
immediately after the occurrence of such redemption. In order to effect the
foregoing redemption, the Company must mail a notice of redemption no later than
45 days after the closing of the related Public Equity Offering and must
consummate such redemption within 60 days of the closing of the Public Equity
Offering.
If less than all of the Securities are to be redeemed, the Trustee
shall select the Securities or portions thereof to be redeemed pro rata, by lot
or by any other method the Trustee shall deem fair and reasonable.
Upon the occurrence of a Change of Control, each Holder may require
the Company to purchase such Holder's Securities in whole or in part in integral
multiples of $1,000, at a purchase price in cash in an amount equal to 101% of
the principal amount thereof, plus accrued and unpaid interest, if any, to the
date of purchase, pursuant to Change of Control Offer and in accordance with the
procedures set forth in the Indenture.
Under certain circumstances, in the event the Net Cash Proceeds
received by the Company from any Asset Sale, which proceeds are not used to
repay permanently any Senior Indebtedness or Senior Guarantor Indebtedness or
invested in Replacement Assets or exceeds a specified amount, the Company will
be required to apply such proceeds to the repayment of the Securities and
certain Indebtedness ranking pari passu in right of payment to the Securities.
-52-
In the case of any redemption or repurchase of Securities in
accordance with the Indenture, interest installments whose Stated Maturity is on
or prior to the Redemption Date will be payable to the Holders of such
Securities of record as of the close of business on the relevant Regular Record
Date or Special Record Date referred to on the face hereof. Securities (or
portions thereof) for whose redemption and payment provision is made in
accordance with the Indenture shall cease to bear interest from and after the
Redemption Date.
In the event of redemption or repurchase of this Security in
accordance with the Indenture in part only, a new Security or Securities for the
unredeemed portion hereof shall be issued in the name of the Holder hereof upon
the cancellation hereof.
If an Event of Default shall occur and be continuing, the principal
amount of all the Securities may be declared due and payable in the manner and
with the effect provided in the Indenture.
The Indenture contains provisions for defeasance at any time of (a)
the entire Indebtedness on the Securities and (b) certain restrictive covenants
and related Defaults and Events of Default, in each case upon compliance with
certain conditions set forth therein.
The Indenture permits, with certain exceptions (including certain
amendments permitted without the consent of any Holders and certain amendments
which required the consent of all of the Holders) as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the Guarantors and the rights of the Holders under the Indenture and
the Securities and the Guarantees at any time by the Company and the Trustee
with the consent of the Holders of at least a majority in aggregate principal
amount of the Securities at the time Outstanding. The Indenture also contains
provisions permitting the Holders of at least a majority in aggregate principal
amount of the Securities (100% of the Holders in certain circumstances) at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company and the Guarantors with certain provisions of the
Indenture and the Securities and the Guarantees and certain past Defaults under
the Indenture and the Securities and the Guarantees and their consequences. Any
such consent or waiver by or on behalf of the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or
in exchange herefor or in lieu hereof whether or not notation of such consent or
waiver is made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, any Guarantor or any other obligor on the Securities (in the event such
Guarantor or such other obligor is obligated to make payments in respect of the
Securities), which is absolute and
-53-
unconditional, to pay the principal of, and premium, if any, and interest on,
this Security at the times, place, and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in the Borough of Manhattan, The City of New
York, duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed by,
the Holder hereof or its attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
Certificated securities shall be transferred to all beneficial
holders in exchange for their beneficial interests in the Rule 144A Global
Securities or the Regulation S Global Securities if (x) the Depositary notifies
the Company that it is unwilling or unable to continue as Depositary for such
Global Security and a successor Depositary is not appointed by the Company
within 90 days or (y) there shall have occurred and be continuing an Event of
Default and the Security Registrar has received a request from the Depositary.
Upon any such issuance, the Trustee is required to register such certificated
Series B Securities in the name of, and cause the same to be delivered to, such
Person or Persons (or the nominee of any thereof).
Series B Securities in certificated form are issuable only in
registered form without coupons in denominations of $1,000 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, the Series B Securities are exchangeable for a
like aggregate principal amount of Securities of a differing authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, any Guarantor, the Trustee and any agent of the Company,
any Guarantor or the Trustee may treat the Person in whose name this Security is
registered as the owner hereof for all purposes, whether or not this Security is
overdue, and neither the Company, any Guarantor, the Trustee nor any such agent
shall be affected by notice to the contrary.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES THEREOF.
All terms used in this Security which are defined in the Indenture
and not otherwise defined herein shall have the meanings assigned to them in the
Indenture.
-54-
[The Transferee Certificate, in the form of Appendix II hereto, will
be attached to the Series B Security.]
Section 204. Form of Guarantee.
-----------------
The form of Guarantee shall be set forth on the Securities
substantially as follows:
GUARANTEE
For value received, each of the undersigned hereby absolutely, fully and
unconditionally and irrevocably guarantees, jointly and severally with each
other Guarantor, to the holder of this Security the payment of principal of,
premium, if any, and interest on this Security upon which these Guarantees are
endorsed in the amounts and at the time when due and payable whether by
declaration thereof, or otherwise, and interest on the overdue principal and
interest, if any, of this Security, if lawful, and the payment or performance of
all other obligations of the Company under the Indenture or the Securities, to
the holder of this Security and the Trustee, all in accordance with and subject
to the terms and limitations of this Security and Article Thirteen of the
Indenture. This Guarantee will not become effective until the Trustee duly
executes the certificate of authentication on this Security. These Guarantees
shall be governed by and construed in accordance with the laws of the State of
New York, without regard to conflict of law principles thereof.
Dated:
TOWN AND COUNTRY FORD INCORPORATED
MARCUS DAVID CORPORATION
FRONTIER OLDSMOBILE--CADILLAC, INC.
SONIC DODGE, LLC
SONIC
CHRYSLER--PLYMOUTH--JEEP--EAGLE,
LLC
FORT MILL FORD, INC.
TOWN AND COUNTRY CHRYSLER--PLYMOUTH--JEEP
OF ROCK HILL, INC.
FORT MILL CHRYSLER--PLYMOUTH--DODGE
INC.
LONE STAR FORD, INC.
SONIC AUTOMOTIVE OF NEVADA, INC.
SONIC AUTOMOTIVE OF TENNESSEE, INC.
SONIC AUTOMOTIVE - 6025 INTERNATIONAL
DRIVE, LLC
SONIC AUTOMOTIVE OF NASHVILLE, LLC
SONIC AUTOMOTIVE OF CHATTANOOGA, LLC
TOWN AND COUNTRY JAGUAR, LLC
TOWN AND COUNTRY CHRYSLER
-55-
--PLYMOUTH--JEEP, LLC
TOWN AND COUNTRY DODGE OF
CHATTANOOGA, LLC
SONIC AUTOMOTIVE - 2490 SOUTH LEE
HIGHWAY, LLC,
TOWN AND COUNTRY FORD OF CLEVELAND,
LLC
FREEDOM FORD, INC.
SONIC AUTOMOTIVE 5260 PEACHTREE
INDUSTRIAL BLVD., LLC
SONIC AUTOMOTIVE OF GEORGIA, INC.
SONIC PEACHTREE INDUSTRIAL BLVD., L.P.
SONIC AUTOMOTIVE - CLEARWATER, INC.
SONIC AUTOMOTIVE 21699 U.S. HWY. 19 N., INC.
SONIC AUTOMOTIVE COLLISION CENTER OF
CLEARWATER, INC.
SONIC AUTOMOTIVE - 1400 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1455 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1495 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1500 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 3700 WEST BROAD
STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE - 4000 WEST BROAD
STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE 2424 LAURENS RD.,
GREENVILLE, INC.
SONIC AUTOMOTIVE 2752 LAURENS RD.,
GREENVILLE, INC.
SONIC AUTOMOTIVE - 5585 PEACHTREE
INDUSTRIAL BLVD., LLC
CAPITOL CHEVROLET AND IMPORTS, INC.,
SONIC AUTOMOTIVE - 1919 N. DIXIE HWY., NSB,
INC.
SONIC AUTOMOTIVE - 1307 N. DIXIE HWY., NSB,
INC.
SONIC AUTOMOTIVE - 1720 MASON AVE., DB,
INC.
SONIC AUTOMOTIVE - 3741 S. NOVA RD., PO,INC.
SONIC AUTOMOTIVE - 241 RIDGEWOOD AVE.,
HH, INC.
-56-
SONIC AUTOMOTIVE - HWY. 153 at SHALLOWFORD
ROAD, CHATTANOOGA, INC.
By______________________________________________
Name:
Title:
Attest: ________________________
Name:
Title:
ARTICLE THREE
THE SECURITIES
Section 301. Title and Terms.
---------------
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to $125,000,000 in
principal amount of Securities, except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of,
other Securities pursuant to Section 303, 304, 305, 306, 307, 308, 906, 1012,
1015 or 1108.
The Securities shall be known and designated as the "11% Senior
Subordinated Notes due 2008" of the Company. The Stated Maturity of the
Securities shall be August 1, 2008, and the Securities shall each bear interest
at the rate of 11% per annum, as such interest rate may be adjusted as set forth
in the Securities, from July 31, 1998, or from the most recent Interest Payment
Date to which interest has been paid, payable semiannually on February 1 and
August 1 in each year, commencing February 1, 1999, until the principal thereof
is paid or duly provided for. Interest on any overdue principal, interest (to
the extent lawful) or premium, if any, shall be payable on demand.
The principal of, premium, if any, and interest on, the Securities
shall be payable and the Securities shall be exchangeable and transferable at an
office or agency of the Company in The City of New York maintained for such
purposes (which initially will be a corporate trust office of the Trustee
located at 100 Wall Street, 20th Floor, New York, New York, 10005); provided,
however, that payment of interest may be made at the option of the Company by
check mailed to addresses of the Persons entitled thereto as shown on the
Security Register.
-57-
For all purposes hereunder, the Series A Securities and the Series B
Securities will be treated as one class and are together referred to as the
"Securities." The Series A Securities rank pari passu in right of payment with
the Series B Securities.
The Securities shall be subject to repurchase by the Company
pursuant to an Offer as provided in Section 1012.
Holders shall have the right to require the Company to purchase
their Securities, in whole or in part, in the event of a Change of Control
pursuant to Section 1014.
The Securities shall be redeemable as provided in Article Eleven and
in the Securities.
The Indebtedness evidenced by these Securities shall be subordinated
in right of payment with all other Senior Indebtedness.
At the election of the Company, the entire Indebtedness on the
Securities or certain of the Company's obligations and covenants and certain
Events of Default thereunder may be defeased as provided in Article Four.
Section 302. Denominations.
--------------
The Securities shall be issuable only in fully registered form
without coupons and only in denominations of $1,000 and any integral multiple
thereof.
Section 303. Execution, Authentication, Delivery and Dating.
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The Securities shall be executed on behalf of the Company by one of
its Chairman of the Board, its President, its Chief Executive Officer, its Chief
Financial Officer or one of its Vice Presidents under its corporate seal
reproduced thereon attested by its Secretary or one of its Assistant
Secretaries. The signatures of any of these officers on the Securities may be
manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities executed by the Company to
the Trustee (with or without Guarantees endorsed thereon) for authentication,
together with a Company Order for the authentication and delivery of such
Securities; and the Trustee in
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accordance with such Company Order shall authenticate and make available for
delivery such Securities as provided in this Indenture and not otherwise.
Each Security shall be dated the date of its authentication.
No Security or Guarantee endorsed thereon shall be entitled to any
benefit under this Indenture or be valid or obligatory for any purpose unless
there appears on such Security a certificate of authentication substantially in
the form provided for herein duly executed by the Trustee by manual signature of
an authorized officer, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder and is entitled to the benefits of this
Indenture.
In case the Company or any Guarantor, pursuant to Article Eight,
shall, in a single transaction or through a series of related transactions, be
consolidated or merged with or into any other Person or shall sell, assign,
convey, transfer, lease or otherwise dispose of all or substantially all of its
properties and assets to any Person, and the successor Person resulting from
such consolidation or surviving such merger, or into which the Company or such
Guarantor shall have been merged, or the successor Person which shall have
participated in the sale, assignment, conveyance, transfer, lease or other
disposition as aforesaid, shall have executed an indenture supplemental hereto
with the Trustee pursuant to Article Eight, any of the Securities authenticated
or delivered prior to such consolidation, merger, sale, assignment, conveyance,
transfer, lease or other disposition may, from time to time, at the request of
the successor Person, be exchanged for other Securities executed in the name of
the successor Person with such changes in phraseology and form as may be
appropriate, but otherwise in substance of like tenor as the Securities
surrendered for such exchange and of like principal amount; and the Trustee,
upon Company Request of the successor Person, shall authenticate and deliver
Securities as specified in such request for the purpose of such exchange. If
Securities shall at any time be authenticated and delivered in any new name of a
successor Person pursuant to this Section 303 in exchange or substitution for or
upon registration of transfer of any Securities, such successor Person, at the
option of the Holders but without expense to them, shall provide for the
exchange of all Securities at the time Outstanding for Securities authenticated
and delivered in such new name.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities on behalf of the Trustee. Unless limited by
the terms of such 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 any Security Registrar or Paying
Agent to deal with the Company and its Affiliates.
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If an officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates such Security such Security shall
be valid nevertheless.
Section 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities which are printed, lithographed,
typewritten or otherwise produced, in any authorized denomination, substantially
of the tenor of the definitive Securities in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and other variations
as the officers executing such Securities may determine, as conclusively
evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for such purpose
pursuant to Section 1002, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall execute
and the Trustee (in accordance with a Company Order for the authentication of
such Securities) shall authenticate and make available for delivery in exchange
therefor a like principal amount of definitive Securities of authorized
denominations. Until so exchanged the temporary Securities shall in all respects
be entitled to the same benefits under this Indenture as definitive Securities.
Section 305. Registration, Registration of Transfer and Exchange.
The Company shall cause the Trustee to keep, so long as it is the
Security Registrar, at the Corporate Trust Office of the Trustee, or such other
office as the Trustee may designate, a register (the register maintained in such
office or in any other office or agency designated pursuant to Section 1002
being herein sometimes referred to as the "Security Register") in which, subject
to such reasonable regulations as the Security Registrar may prescribe, the
Company shall provide for the registration of Securities and of transfers of
Securities. The Trustee shall initially be the "Security Registrar" for the
purpose of registering Securities and transfers of Securities as herein
provided. The Company may change the Security Registrar or appoint one or more
co-Security Registrars without notice.
Upon surrender for registration of transfer of any Security at the
office or agency of the Company designated pursuant to Section 1002, the Company
shall execute, and the Trustee shall (in accordance with a Company Order for the
authentication of such Securities) authenticate and make available for delivery,
in the name of the designated transferee or transferees, one or more new
Securities of the same series of any authorized denomination or denominations,
of a like aggregate principal amount.
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Furthermore, any Holder of the Global Security shall, by acceptance
of such Global Security, agree that transfers of beneficial interests in such
Global Security may be effected only through a book-entry system maintained by
the Holder of such Global Security (or its agent), and that ownership of a
beneficial interest in a Security shall be required to be reflected in a book
entry.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations, of a like aggregate
principal amount, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall (in accordance with a Company Order
for the authentication of such Securities) authenticate and make available for
delivery, Securities of the same series which the Holder making the exchange is
entitled to receive; provided that no exchange of Series A Securities for Series
B Securities shall occur until an Exchange Offer Registration Statement shall
have been declared effective by the Commission and that the Series A Securities
exchanged for the Series B Securities shall be canceled.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company, evidencing the same
Indebtedness, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer, or for exchange, repurchase or redemption, shall (if so required by
the Company or the Trustee) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar, duly executed by the Holder thereof or his attorney duly authorized
in writing.
No service charge shall be made to a Holder for any registration of
transfer, exchange or redemption of Securities, except for any tax or other
governmental charge that may be imposed in connection therewith, other than
exchanges pursuant to Sections 303, 304, 305, 308, 906, 1012, 1014 or 1108 not
involving any transfer.
The Company shall not be required (a) to issue, register the
transfer of or exchange any Security during a period beginning at the opening of
business 15 days before the mailing of a notice of redemption of the Securities
selected for redemption under Section 1104 and ending at the close of business
on the day of such mailing or (b) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except the unredeemed
portion of Securities being redeemed in part.
Every Security shall be subject to the restrictions on transfer
provided in the legend required to be set forth on the face of each Security
pursuant to Section 202, and the restrictions set forth in this Section 305, and
the Holder of each Security, by such
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Holder's acceptance thereof (or interest therein), agrees to be bound by such
restrictions on transfer.
Except as provided in the preceding paragraph, any Security
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, any Global Security, whether pursuant to this Section 305,
Section 304, 308, 906 or 1108 or otherwise, shall also be a Global Security and
bear the legend specified in Section 202.
Section 306. Book Entry Provisions for Global Securities.
(a) Each Global Security initially shall (i) be registered in the
name of the Depositary for such Global Security or the nominee of such
Depositary, (ii) be deposited with, or on behalf of, the Depositary or with the
Trustee as custodian for such Depositary and (iii) bear legends as set forth in
Section 202.
Members of, or participants in, the Depositary ("Agent Members")
shall have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary, or the Trustee as its custodian, or
under such Global Security, and the Depositary may be treated by the Company,
the Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or shall impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a holder of any Security.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary (A) has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Security or (B)
has ceased to be a clearing agency registered as such under the Exchange Act,
and in either case the Company fails to appoint a successor Depositary, (ii) the
Company, at its option, executes and delivers to the Trustee a Company Order
stating that it elects to cause the issuance of the Securities in certificated
form and that all Global Securities shall be exchanged in whole for Securities
that are not Global Securities (in which case such exchange shall be effected by
the Trustee) or (iii) there shall have occurred and be continuing an Event of
Default or any event which after notice or lapse of time or both would be an
Event of Default with respect to such Global Security.
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(c) If any Global Security is to be exchanged for other Securities
or canceled in whole, it shall be surrendered by or on behalf of the Depositary
or its nominee to the Trustee, as Security Registrar, for exchange or
cancellation as provided in this Article Three. If any Global Security is to be
exchanged for other Securities or canceled in part, or if another Security is to
be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article Three or (ii) the principal
amount thereof shall be reduced or increased by an amount equal to the portion
thereof to be so exchanged or canceled, or equal to the principal amount of such
other Security to be so exchanged for a beneficial interest therein, as the case
may be, by means of an appropriate adjustment made on the records of the
Trustee, as Security Registrar, whereupon the Trustee, in accordance with the
Applicable Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records. Upon any such
surrender or adjustment of a Global Security, the Trustee shall, subject to this
Section 306(c) and as otherwise provided in this Article Three, authenticate and
deliver any Securities issuable in exchange for such Global Security (or any
portion thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative which is given or
made pursuant to this Article Three if such order, direction or request is given
or made in accordance with the Applicable Procedures.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article Three or otherwise, shall be
authenticated and delivered in the form of, and shall be, a Global Security,
unless such Security is registered in the name of a Person other than the
Depositary for such Global Security or a nominee thereof.
(e) The Depositary or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
this Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.
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Section 307. Special Transfer and Exchange Provisions.
(a) Certain Transfers and Exchanges. Transfers and exchanges of
Securities and beneficial interests in a Global Security of the kinds specified
in this Section 307 shall be made only in accordance with this Section 307.
(i) Rule 144A Global Security to Regulation S Global Security.
If the owner of a beneficial interest in the Rule 144A Global
Security wishes at any time to transfer such interest to a Person
who wishes to acquire the same in the form of a beneficial interest
in the Regulation S Global Security, such transfer may be effected
only in accordance with the provisions of this paragraph and
paragraph (iv) below and subject to the Applicable Procedures. Upon
receipt by the Trustee, as Security Registrar, of (a) an order given
by the Depositary or its authorized representative directing that a
beneficial interest in the Regulation S Global Security in a
specified principal amount be credited to a specified Agent Member's
account and that a beneficial interest in the Rule 144A Global
Security in an equal principal amount be debited from another
specified Agent Member's account and (b) a Regulation S Certificate
in the form of Exhibit A hereto, satisfactory to the Trustee and
duly executed by the owner of such beneficial interest in the Rule
144A Global Security or his attorney duly authorized in writing,
then the Trustee, as Security Registrar but subject to paragraph
(iv) below, shall reduce the principal amount of the Rule 144A
Global Security and increase the principal amount of the Regulation
S Global Security by such specified principal amount as provided in
Section 306(c).
(ii) Regulation S Global Security to Rule 144A Global
Security. If the owner of a beneficial interest in the Regulation S
Global Security wishes at any time to transfer such interest to a
Person who wishes to acquire the same in the form of a beneficial
interest in the Rule 144A Global Security, such transfer may be
effected only in accordance with this paragraph (ii) and subject to
the Applicable Procedures. Upon receipt by the Trustee, as Security
Registrar, of (a) an order given by the Depositary or its authorized
representative directing that a beneficial interest in the Rule 144A
Global Security in a specified principal amount be credited to a
specified Agent Member's account and that a beneficial interest in
the Regulation S Global Security in an equal principal amount be
debited from another specified Agent Member's account and (b) if
such transfer is to occur during the Restricted Period, a Restricted
Securities Certificate in the form of Exhibit B hereto, satisfactory
to the Trustee and duly executed by the owner of such beneficial
interest in the Regulation S Global Security or his attorney duly
authorized in writing, then the Trustee, as Security
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Registrar, shall reduce the principal amount of the Regulation S
Global Security and increase the principal amount of the Rule 144A
Global Security by such specified principal amount as provided in
Section 306(c).
(iii) Exchanges between Global Security and Non-Global
Security. A beneficial interest in a Global Security may be
exchanged for a Security that is not a Global Security as provided
in Section 307(b), provided that, if such interest is a beneficial
interest in the Rule 144A Global Security, or if such interest is a
beneficial interest in the Regulation S Global Security and such
exchange is to occur during the Restricted Period, then such
interest shall bear the Private Placement Legend (subject in each
case to Section 307(b).
(iv) Regulation S Global Security to be Held Through Euroclear
or Cedel during Restricted Period. The Company shall use its best
efforts to cause the Depositary to ensure that, until the expiration
of the Restricted Period, beneficial interests in the Regulation S
Global Security may be held only in or through accounts maintained
at the Depositary by Euroclear or Cedel (or by Agent Members acting
for the account thereof), and no person shall be entitled to effect
any transfer or exchange that would result in any such interest
being held otherwise than in or through such an account; provided
that this paragraph (iv) shall not prohibit any transfer or exchange
of such an interest in accordance with paragraph (ii) above.
(b) Private Placement Legends. Rule 144A Securities and their
Successor Securities and Regulation S Securities and their Successor Securities
shall bear a Private Placement Legend, subject to the following:
(i) subject to the following clauses of this Section 307(b), a
Security or any portion thereof which is exchanged, upon transfer or
otherwise, for a Global Security or any portion thereof shall bear
the Private Placement Legend borne by such Global Security while
represented thereby;
(ii) subject to the following Clauses of this Section 307(b),
a new Security which is not a Global Security and is issued in
exchange for another Security (including a Global Security) or any
portion thereof, upon transfer or otherwise, shall bear the Private
Placement Legend borne by such other Security;
(iii) Exchange Securities, and all other Securities sold or
otherwise disposed of pursuant to an effective registration
statement under the Securities Act, together with their respective
Successor Securities, shall not bear a Private Placement Legend;
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(iv) at any time after the Securities may be freely
transferred without registration under the Securities Act or without
being subject to transfer restrictions pursuant to the Securities
Act, a new Security which does not bear a Private Placement Legend
may be issued in exchange for or in lieu of a Security (other than a
Global Security) or any portion thereof which bears such a legend if
the Trustee has received an Unrestricted Securities Certificate
substantially in the form of Exhibit C hereto, satisfactory to the
Trustee and duly executed by the Holder of such legended Security or
his attorney duly authorized in writing, and after such date and
receipt of such certificate, the Trustee shall authenticate and
deliver such a new Security in exchange for or in lieu of such other
Security as provided in this Article Three;
(v) a new Security which does not bear a Private Placement
Legend may be issued in exchange for or in lieu of a Security (other
than a Global Security) or any portion thereof which bears such a
legend if, in the Company's judgment, placing such a legend upon
such new Security is not necessary to ensure compliance with the
registration requirements of the Securities Act, and the Trustee, at
the direction of the Company, shall authenticate and deliver such a
new Security as provided in this Article Three; and
(vi) notwithstanding the foregoing provisions of this Section
307(b), a Successor Security of a Security that does not bear a
particular form of Private Placement Legend shall not bear such form
of legend unless the Company has reasonable cause to believe that
such Successor Security is a "restricted security" within the
meaning of Rule 144, in which case the Trustee, at the direction of
the Company, shall authenticate and deliver a new Security bearing a
Private Placement Legend in exchange for such Successor Security as
provided in this Article Three.
By its acceptance of any Security bearing the Private Placement
Legend, each Holder of such a Security acknowledges the restrictions on transfer
of such Security set forth in this Indenture and in the Private Placement Legend
and agrees that it will transfer such Security only as provided in this
Indenture.
The Security Registrar shall retain copies of all letters, notices
and other written communications received pursuant to Section 306 or this
Section 307. The Company shall have the right to inspect and make copies of all
such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Security Registrar.
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In the event that Regulation S is amended during the term of this
Indenture to alter the applicable holding period, all reference in this
Indenture to a holding period for Non-U.S. Persons will be deemed to include
such amendment.
Section 308. Mutilated, Destroyed, Lost and Stolen Securities.
If (a) any mutilated Security is surrendered to the Trustee, or (b)
the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company, any Guarantor and the Trustee, such security or indemnity, in each
case, as may be required by them to save each of them harmless, then, in the
absence of notice to the Company, any Guarantor or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall execute
and upon a Company Request the Trustee shall authenticate and deliver, in
exchange for any such mutilated Security or in lieu of any such destroyed, lost
or stolen Security, a replacement Security of like tenor and principal amount,
bearing a number not contemporaneously outstanding and each Guarantor shall
execute a replacement Guarantee.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a replacement Security, pay such Security.
Upon the issuance of any replacement Securities under this Section,
the Company may require the payment of a sum sufficient to pay all documentary,
stamp or similar issue or transfer taxes or other governmental charges that may
be imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every replacement Security and Guarantee issued pursuant to this
Section in lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company and any Guarantor,
whether or not the destroyed, lost or stolen Security shall be at any time
enforceable by anyone, and shall be entitled to all benefits of this Indenture
equally and proportionately with any and all other Securities duly issued
hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
Section 309. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or
duly provided for, on the Stated Maturity of such interest shall be paid to the
Person in whose
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name the Security (or any Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest payment.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on the Stated Maturity of such interest, and interest
on such defaulted interest at the then applicable interest rate borne by the
Securities, to the extent lawful (such defaulted interest and interest thereon
herein collectively called "Defaulted Interest"), shall forthwith cease to be
payable to the Holder on the Regular Record Date; and such Defaulted Interest
may be paid by the Company, at its election in each case, as provided in
Subsection (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities (or any relevant
Predecessor Securities) are registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest,
which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security and the date (not less than 30
days after such notice) of the proposed payment (the "Special
Payment Date"), and at the same time the Company shall deposit with
the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such deposit prior
to the Special Payment Date, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Subsection provided. Thereupon the Trustee shall
fix a Special Record Date for the payment of such Defaulted Interest
which shall be not more than 15 days and not less than 10 days prior
to the date of the Special Payment Date and not less than 10 days
after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company in writing of
such Special Record Date. In the name and at the expense of the
Company, the Trustee shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor to be
mailed, first-class postage prepaid, to each Holder at its address
as it appears in the Security Register, not less than 10 days prior
to such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date and Special Payment
Date therefor having been so mailed, such Defaulted Interest shall
be paid to the Persons in whose names the Securities are registered
on such Special Record Date and shall no longer be payable pursuant
to the following Subsection (b).
(b) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon
such notice as
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may be required by this Indenture not inconsistent with the
requirements of such exchange, if, after written notice given by the
Company to the Trustee of the proposed payment pursuant to this
Subsection, such payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 309, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
Section 310. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and the Company, or the Trustee on behalf of the
Company, shall use CUSIP numbers in notices of redemption or exchange as a
convenience to Holders; provided, however, that any such notice shall state that
no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of redemption or
exchange and that reliance may be placed only on the other identification
numbers printed on the Securities; and provided further, however, that failure
to use CUSIP numbers in any notice of redemption or exchange shall not affect
the validity or sufficiency of such notice.
Section 311. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, any Guarantor, the Trustee and any agent of the Company, any
Guarantor or the Trustee may treat the Person in whose name any Security is
registered as the owner of such Security for the purpose of receiving payment of
principal of, premium, if any, and (subject to Section 309) interest on, such
Security and for all other purposes whatsoever, whether or not such Security is
overdue, and neither the Company, any Guarantor, the Trustee nor any agent of
the Company, any Guarantor or the Trustee shall be affected by notice to the
contrary.
Section 312. Cancellation.
All Securities surrendered for payment, purchase, redemption,
registration of transfer or exchange shall be delivered to the Trustee and, if
not already canceled, shall be promptly canceled by it. The Company and any
Guarantor may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company or such
Guarantor may have acquired in any manner whatsoever, and all Securities so
delivered shall be promptly canceled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities canceled as provided
in this Section 312, except as expressly permitted by this Indenture. All
canceled Securities held by the Trustee shall be returned to the Company. The
Trustee
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shall provide the Company a list of all Securities that have been canceled from
time to time as requested by the Company.
Section 313. Computation of Interest.
Interest on the Securities shall be computed on the basis of a
360-day year comprised of twelve 30-day months.
ARTICLE FOUR
DEFEASANCE AND COVENANT DEFEASANCE
Section 401. Company's Option to Effect Defeasance or Covenant
Defeasance.
The Company may, at its option by Board Resolution, at any time,
with respect to the Securities, elect to have either Section 402 or Section 403
be applied to all of the Outstanding Securities (the "Defeased Securities"),
upon compliance with the conditions set forth below in this Article Four.
Section 402. Defeasance and Discharge.
Upon the Company's exercise under Section 401 of the option
applicable to this Section 402, the Company, each Guarantor and any other
obligor upon the Securities, if any, shall be deemed to have been discharged
from its obligations with respect to the Defeased Securities on the date the
conditions set forth in Section 404 below are satisfied (hereinafter,
"defeasance"). For this purpose, such defeasance means that the Company, each
Guarantor and any other obligor under this Indenture shall be deemed to have
paid and discharged the entire Indebtedness represented by the Defeased
Securities, which shall thereafter be deemed to be "Outstanding" only for the
purposes of Section 405 and the other Sections of this Indenture referred to in
(a) and (b) 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 and upon Company Request, shall execute
proper instruments acknowledging the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (a) the rights of
Holders of Defeased Securities to receive, solely from the trust fund described
in Section 404 and as more fully set forth in such Section, payments in respect
of the principal of, premium, if any, and interest on, such Securities, when
such payments are due, (b) the Company's obligations with respect to such
Defeased Securities under Sections 304, 305, 308, 1002 and 1003, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder, including,
without limitation, the Trustee's rights under Section 607, and (d) this Article
Four. Subject to compliance with this Article
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Four, the Company may exercise its option under this Section 402 notwithstanding
the prior exercise of its option under Section 403 with respect to the
Securities.
Section 403. Covenant Defeasance.
Upon the Company's exercise under Section 401 of the option
applicable to this Section 403, the Company and each Guarantor shall be released
from itsobligations under any covenant or provision contained or referred to in
Sections 1005 through 1020, inclusive, and the provisions of clause (iii) of
Section 801(a), with respect to the Defeased Securities, on and after the date
the conditions set forth in Section 404 below are satisfied (hereinafter,
"covenant defeasance"), and the Defeased Securities shall thereafter be deemed
to be not "Outstanding" for the purposes of any direction, waiver, consent or
declaration or Act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Defeased Securities, the Company and each
Guarantor may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such Section, whether directly or
indirectly, by reason of any reference elsewhere herein to any such Section or
by reason of any reference in any such Section 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 501(c), (d), (f) or (g) but, except as
specified above, the remainder of this Indenture and such Defeased Securities
shall be unaffected thereby.
Section 404. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 402 or Section 403 to the Defeased Securities:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Securities, (a) cash in United States
dollars, (b) U.S. Government Obligations, or (c) a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized firm of
independent public accountants or a nationally recognized investment banking
firm expressed in a written certification thereof delivered to the Trustee, to
pay and discharge, and which shall be applied by the Trustee to pay and
discharge, the principal of, premium, if any, and interest on, the Defeased
Securities, on the Stated Maturity of such principal or interest (or on any date
after August 1, 2003 (such date being referred to as the "Defeasance Redemption
Date") if at or prior to electing to exercise either its option applicable to
Section 402 or its option applicable to Section 403, the Company has delivered
to the Trustee an irrevocable notice to redeem the Defeased Securities on the
Defeasance Redemption Date). For this purpose, "U.S.
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Government Obligations" means securities that are (i) direct obligations of the
United States of America for the timely payment of which its full faith and
credit is pledged or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States of America the
timely payment of which is unconditionally guaranteed as a full faith and credit
obligation by the United States of America, which, in either case, are not
callable or redeemable at the option of the issuer thereof, and shall also
include a Depositary receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act), as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any such U.S.
Government Obligation held by such custodian for the account of the holder of
such Depositary receipt, provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such Depositary receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or the specific payment of principal
of or interest on the U.S. Government Obligation evidenced by such Depositary
receipt;
(2) In the case of an election under Section 402, the Company shall
have delivered to the Trustee an Opinion of Independent Counsel in the United
States stating that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the date
hereof, there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such Opinion of Independent
Counsel in the United States 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 defeasance and will be subject to federal income
tax on the same amounts, in the same manner and at the same times as would have
been the case if such defeasance had not occurred;
(3) In the case of an election under Section 403, the Company shall
have delivered to the Trustee an Opinion of Independent Counsel in the United
States 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;
(4) No Default or Event of shall have occurred and be continuing on
the date of such deposit or insofar as Section 501(h) or (i) is concerned, at
any time during the period ending on the 91st day after the date of deposit (it
being understood that this condition shall not be deemed satisfied until the
expiration of such period) (other than a Default which results from the
borrowing of amounts to finance the defeasance and which borrowing does not
result in a breach or violation of, or constitute a default, under any other
material agreement or instrument to which the Company or any Restricted
Subsidiary is a party or to which it is bound);
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(5) Such defeasance or covenant defeasance shall not cause the
Trustee for the Securities to have a conflicting interest in violation of and
for purposes of the Trust Indenture Act with respect to any other securities of
the Company or any Guarantor;
(6) Such defeasance or covenant defeasance shall not result in a
breach or violation of, or constitute a Default under, this Indenture or any
other material agreement or instrument to which the Company, any Guarantor or
any Restricted Subsidiary is a party or by which it is bound;
(7) Such defeasance or covenant defeasance shall not result in the
trust arising from such deposit constituting an investment company within the
meaning of the Investment Company Act of 1940, as amended, unless such trust
shall be registered under such Act or exempt from registration thereunder;
(8) The Company shall have delivered to the Trustee an Opinion of
Independent Counsel in the United States to the effect that (assuming that no
Holder of any Securities would be considered an insider of the Company under any
applicable bankruptcy or insolvency law) after the 91st day following the
deposit, the trust funds will not be subject to the effect of any applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally;
(9) The Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the holders of the Securities or any Guarantee over the other
creditors of the Company or any Guarantor with the intent of defeating,
hindering, delaying or defrauding creditors of the Company, any Guarantor or
others;
(10) No event or condition shall exist that would prevent the
Company from making payments of the principal of, premium, if any, and interest
on the Securities on the date of such deposit or at any time ending on the 91st
day after the date of such deposit; and
(11) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Independent Counsel, each stating that all
conditions precedent provided for relating to either the defeasance under
Section 402 or the covenant defeasance under Section 403 (as the case may be)
have been complied with.
Opinions of Counsel or Opinions of Independent Counsel required to
be delivered under this Section shall be in form and substance reasonably
satisfactory to the Trustee may have qualifications customary for opinions of
the type required and counsel delivering such opinions may rely on certificates
of the Company or government or other officials customary for opinions of the
type required, which certificates shall be limited as to matters of fact,
including that various financial covenants have been complied with.
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Section 405. Deposited Money and U.S. Government Obligations to Be Held
in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
United States dollars and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee pursuant to Section 404 in respect of the
Defeased Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any Paying Agent (excluding the Company or
any of its Affiliates acting as Paying Agent), as the Trustee may determine, to
the Holders of such Securities of all sums due and to become due thereon in
respect of principal, premium, if any, 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 Section 404 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
imposed, assessed or for the account of the Holders of the Defeased Securities.
Anything in this Article Four to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any United States dollars or U.S. Government Obligations held by it as
provided in Section 404 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 defeasance or covenant defeasance.
Section 406. Reinstatement.
If the Trustee or Paying Agent is unable to apply any United States
dollars or U.S. Government Obligations in accordance with Section 402 or 403, as
the case may be, by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the Company's obligations under this Indenture and the Securities and any
Guarantor's obligations under any Guarantee shall be revived and reinstated,
with present and prospective effect, as though no deposit had occurred pursuant
to Section 402 or 403, as the case may be, until such time as the Trustee or
Paying Agent is permitted to apply all such United States dollars or U.S.
Government Obligations in accordance with Section 402 or 403, as the case may
be; provided, however, that if the Company makes any payment to the Trustee or
Paying Agent of principal of, premium, if any, or interest on any Security
following the reinstatement of its obligations, the Trustee or Paying Agent
shall promptly pay any such amount to the Holders of the Securities and the
Company shall be subrogated to the rights
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of the Holders of such Securities to receive such payment from the United States
dollars and U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE FIVE
REMEDIES
Section 501. Events of Default.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(a) there shall be a default in the payment of any interest on any
Security when it becomes due and payable, and such default shall continue for a
period of 30 days (whether or not prohibited by the subordination provisions of
this Indenture);
(b) there shall be a default in the payment of the principal of (or
premium, if any, on) any Security at its Maturity (upon acceleration, optional
or mandatory redemption, required repurchase or otherwise) (whether or not
prohibited by the subordination provisions of this Indenture);
(c) (i) there shall be a default in the performance, or breach, of
any covenant or agreement of the Company or any Guarantor under this Indenture
or any Guarantee (other than a default in the performance, or breach, of a
covenant or agreement which is specifically dealt with in clause (a), (b) or in
clause (ii), (iii) or (iv) of this clause (c)) and such default or breach shall
continue for a period of 60 days after written notice (30 days in the case of a
default under Section 1008 or Section 1009 herein) has been given, by certified
mail, (x) to the Company by the Trustee or (y) to the Company and the Trustee by
the Holders of at least 25% in aggregate principal amount of the outstanding
Securities; (ii) there shall be a default in the performance or breach of the
provisions of Article Eight; (iii) the Company shall have failed to consummate
an Offer in accordance with the provisions of Section 1012; or (iv) the Company
shall have failed to consummate a Change of Control Offer in accordance with the
provisions of Section 1014;
(d) one or more defaults, individually or in the aggregate, shall
have occurred under any of the agreements, indentures or instruments under which
the Company or any Restricted Subsidiary then has outstanding Indebtedness in
excess of $20 million in principal amount, individually or in the aggregate, and
either (i) such default results from the failure to pay such Indebtedness at its
stated final maturity or (ii) such default or defaults resulted in the
acceleration of the maturity of such Indebtedness;
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(e) any Guarantee shall for any reason cease to be, or shall for any
reason be asserted in writing by any Guarantor or the Company not to be, in full
force and effect and enforceable in accordance with its terms, except to the
extent contemplated by this Indenture and any such Guarantee;
(f) one or more final judgments, orders or decrees (not subject to
appeal) of any court or regulatory or administrative agency for the payment of
money in excess of $20 million, either individually or in the aggregate
(exclusive of any portion of any such payment covered by insurance, if and to
the extent the insurer has acknowledged in writing its liability therefor),
shall be rendered against the Company, any Guarantor or any Subsidiary or any of
their respective properties and shall not be discharged or fully binded and
there shall have been a period of 60 consecutive days during which a stay of
enforcement of such judgment or order, by reason of an appeal or otherwise,
shall not be in effect;
(g) any holder or holders of at least $20 million in aggregate
principal amount of Indebtedness of the Company, any Guarantor or any Restricted
Subsidiary after a default under such Indebtedness shall notify the Trustee of
the intended sale or disposition of any assets of the Company, any Guarantor or
any Subsidiary that have been pledged to or for the benefit of such holder or
holders to secure such Indebtedness or shall commence proceedings, or take any
action (including by way of set-off), to retain in satisfaction of such
Indebtedness or to collect on, seize, dispose of or apply in satisfaction of
Indebtedness, assets of the Company, any Guarantor or any Restricted Subsidiary
(including funds on deposit or held pursuant to lock-box and other similar
arrangements);
(h) there shall have been the entry by a court of competent
jurisdiction of (i) a decree or order for relief in respect of the Company or
any Significant Restricted Subsidiary in an involuntary case or proceeding under
any applicable Bankruptcy Law or (ii) a decree or order adjudging the Company or
any Significant Restricted Subsidiary bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment or composition of or in respect of the
Company or any Significant Restricted Subsidiary under any applicable federal or
state law, or appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of the Company or any Significant
Restricted Subsidiary or of any substantial part of their respective properties,
or ordering the winding up or liquidation of their respective affairs, and any
such decree or order for relief shall continue to be in effect, or any such
other decree or order shall be unstayed and in effect, for a period of 60
consecutive days; or
(i) (i) the Company or any Significant Restricted Subsidiary
commences a voluntary case or proceeding under any applicable Bankruptcy Law or
any other case or proceeding to be adjudicated bankrupt or insolvent, (ii) the
Company or any Significant Restricted Subsidiary consents to the entry of a
decree or order for relief in respect of the Company or such Significant
Restricted Subsidiary in an involuntary case or proceeding
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under any applicable Bankruptcy Law or to the commencement of any bankruptcy or
insolvency case or proceeding against it, (iii) the Company or any Significant
Restricted Subsidiary files a petition or answer or consent seeking
reorganization or relief under any applicable federal or state law, (iv) the
Company or any Significant Restricted Subsidiary (1) consents to the filing of
such petition or the appointment of, or taking possession by, a custodian,
receiver, liquidator, assignee, trustee, sequestrator or similar official of the
Company or such Significant Restricted Subsidiary or of any substantial part of
their respective properties, (2) makes an assignment for the benefit of
creditors or (3) admits in writing its inability to pay its debts generally as
they become due or (v) the Company or any Significant Restricted Subsidiary
takes any corporate action in furtherance of any such actions in this paragraph
(i).
Section 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Sections 501(h) and (i) shall occur and be continuing with respect to this
Indenture, the Trustee or the Holders of not less than 25% in aggregate
principal amount of the Securities then Outstanding may, and the Trustee at the
request of such Holders shall, declare all unpaid principal of, premium, if any,
and accrued interest on all Securities to be due and payable immediately, by a
notice in writing to the Company (and to the Trustee if given by the Holders of
the Securities) and upon any such declaration, such principal, premium, if any,
and interest shall become due and payable immediately. If an Event of Default
specified in clause (h) or (i) of Section 501 occurs and is continuing, then all
the Securities shall ipso facto become and be due and payable immediately in an
amount equal to the principal amount of the Securities, together with accrued
and unpaid interest, if any, to the date the Securities become due and payable,
without any declaration or other act on the part of the Trustee or any Holder.
Thereupon, the Trustee may, at its discretion, proceed to protect and enforce
the rights of the Holders of the Securities by appropriate judicial proceedings.
After a declaration of acceleration with respect to the Securities,
but before a judgment or decree for payment of the money due has been obtained
by the Trustee as hereinafter in this Article provided, the Holders of a
majority in aggregate principal amount of the Securities Outstanding, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if:
(a) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(i) all sums paid or advanced by the Trustee under this
Indenture and the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel,
(ii) all overdue interest on all Outstanding Securities,
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(iii) the principal of and premium, if any, on any Outstanding
Securities which have become due otherwise than by such declaration
of acceleration and interest thereon at the rate borne by the
Securities, and
(iv) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate borne by the Securities;
(b) the rescission would not conflict with any judgment or decree of
a court of competent jurisdiction; and
(c) all Events of Default, other than the non-payment of principal
of, premium, if any, and interest on the Securities which have become due solely
by such declaration of acceleration, have been cured or waived as provided in
Section 513. No such rescission shall affect any subsequent Default or impair
any right consequent thereon.
Section 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company and each Guarantor covenant that if
(a) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(b) default is made in the payment of the principal of or premium,
if any, on any Security at the Stated Maturity thereof or otherwise,
the Company and such Guarantor will, upon demand of the Trustee, pay to it, for
the benefit of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal and premium, if any, and interest, with
interest upon the overdue principal and premium, if any, and, to the extent that
payment of such interest shall be legally enforceable, upon overdue installments
of interest, at the rate borne by the Securities; and, in addition thereto, 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.
If the Company or any Guarantor, as the case may be, fails to pay
such amounts forthwith upon such demand, the Trustee, in its own name and as
trustee of an express trust, may institute a judicial proceeding for the
collection of the sums so due and unpaid and may prosecute such proceeding to
judgment or final decree, and may enforce the same against the Company or any
Guarantor or any other obligor upon the Securities and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company, any Guarantor or any other obligor upon the Securities,
wherever situated.
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If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders under this Indenture or any Guarantee by such appropriate private or
judicial proceedings as the Trustee shall deem most effectual to protect and
enforce such rights, including seeking recourse against any Guarantor pursuant
to the terms of any Guarantee, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein or therein, or to enforce any other proper remedy, including,
without limitation, seeking recourse against any Guarantor pursuant to the terms
of a Guarantee, or to enforce any other proper remedy, subject however to
Section 512. No recovery of any such judgment upon any property of the Company
or any Guarantor shall affect or impair any rights, powers or remedies of the
Trustee or the Holders.
Section 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor,
including any Guarantor, upon the Securities or the property of the Company or
of such other obligor or their creditors, the Trustee (irrespective of whether
the principal of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of overdue principal
or interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise,
(a) to file and prove a claim for the whole amount of principal, and
premium, if any, and interest owing and unpaid in respect of the Securities and
to file such 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 of the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
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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 Holder in any such proceeding.
Section 505. Trustee May Enforce Claims without Possession of Securities.
All rights of action and claims under this Indenture, the Securities
or the Guarantees may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the production thereof in any proceeding
relating thereto, and any such proceeding instituted by the Trustee shall be
brought in its own name and as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
Section 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article or
otherwise on behalf of the Holders or the Trustee pursuant to this Article or
through any proceeding or any arrangement or restructuring in anticipation or in
lieu of any proceeding contemplated by this Article shall be applied, subject to
applicable law, in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal,
premium, if any, or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
607;
SECOND: To the payment of the amounts then due and unpaid upon the
Securities for principal, premium, if any, and interest, in respect of which or
for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and payable on
such Securities for principal, premium, if any, and interest; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto, including the Company, provided that all sums due and owing to the
Holders and the Trustee have been paid in full as required by this Indenture.
Section 507. Limitation on Suits.
No Holder of any Securities shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture or the
Securities, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
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(a) such Holder has previously given written notice to the Trustee
of a continuing Event of Default;
(b) the Holders of not less than 25% in aggregate principal amount
of the Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
trustee hereunder;
(c) such Holder or Holders have offered to the Trustee a reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(d) the Trustee for 15 days after its receipt of such notice,
request and offer (and if requested, provision) of indemnity has failed to
institute any such proceeding; and
(e) no direction inconsistent with such written request has been
given to the Trustee during such 15-day period by the Holders of a majority in
principal amount of the Outstanding Securities;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture, any Security or any Guarantee to affect, disturb or prejudice
the rights of any other Holders, or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this Indenture,
any Security or any Guarantee, except in the manner provided in this Indenture
and for the equal and ratable benefit of all the Holders.
Section 508. Unconditional Right of Holders to Receive Principal, Premium
and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right based on the terms stated herein, which is
absolute and unconditional, to receive payment of the principal of, premium, if
any, and (subject to Section 309) interest on such Security on the respective
Stated Maturities expressed in such Security (or, in the case of redemption or
repurchase, on the Redemption Date or the repurchase date) and to institute suit
for the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
Section 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture or any Guarantee and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case the Company, any Guarantor, any other obligor on the Securities, the
Trustee and the Holders shall, subject to any
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determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
Section 510. 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.
Section 511. 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 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 512. Control by Holders.
The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities shall have the right to direct the time,
method and place of conducting any proceeding for exercising any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, provided that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture (including, without limitation, Section 507) or any
Guarantee, expose the Trustee to personal liability, or be unduly prejudicial to
Holders not joining therein; and
(b) subject to the provisions of Section 315 of the Trust Indenture
Act, the Trustee may take any other action deemed proper by the Trustee which is
not inconsistent with such direction.
Section 513. Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal
amount of the Outstanding Securities may on behalf of the Holders of all
Outstanding Securities waive any past Default hereunder and its consequences,
except a Default
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(a) in the payment of the principal of, premium, if any, or interest
on any Security (which may only be waived with the consent of each Holder of the
Securities affected); or
(b) in respect of a covenant or a provision hereof which under this
Indenture cannot be modified or amended without the consent of the Holder of
each Security Outstanding affected by such modification or amendment.
Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereon.
Section 514. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, 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,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant, but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of the Outstanding Securities,
or to any suit instituted by any Holder for the enforcement of the payment of
the principal of, premium, if any, or interest on, any Security on or after the
respective Stated Maturities expressed in such Security (or, in the case of
redemption, on or after the Redemption Date).
Section 515. Waiver of Stay, Extension or Usury Laws.
Each of the Company and the Guarantors covenants (to the extent that
it may lawfully do so) that it will not at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or
extension law or any usury or other law wherever enacted, now or at any time
hereafter in force, which would prohibit or forgive the Company or any Guarantor
from paying all or any portion of the principal of, premium, if any, or interest
on the Securities contemplated herein or in the Securities or which may affect
the covenants or the performance of this Indenture; and each of the Company and
the Guarantors (to the extent that it may lawfully do so) 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.
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Section 516. Remedies Subject to Applicable Law.
All rights, remedies and powers provided by this Article Five may be
exercised only to the extent that the exercise thereof does not violate any
applicable provision of law in the premises, and all the provisions of this
Indenture are intended to be subject to all applicable mandatory provisions of
law which may be controlling in the premises and to be limited to the extent
necessary so that they will not render this Indenture invalid, unenforceable or
not entitled to be recorded, registered or filed under the provisions of any
applicable law.
ARTICLE SIX
THE TRUSTEE
Section 601. Duties of Trustee.
Subject to the provisions of Trust Indenture Act Sections 315(a)
through 315(d):
(a) if a Default or an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture and use the same degree of care and skill in its exercise
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:
(1) the Trustee need perform only those duties as are
specifically set forth in this Indenture and no covenants or
obligations shall be implied in this Indenture that are adverse to
the Trustee; and
(2) in the absence of bad faith or willful misconduct 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 may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this Subsection (c) does not limit the effect of
Subsection (b) of this Section 601;
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(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts;
and
(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith, in accordance with a
direction of the Holders of a majority in principal amount of
Outstanding Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power confirmed upon the Trustee under
this Indenture;
(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) whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to Subsections
(a), (b), (c) and (d) and (f) of this Section 601; and
(f) the Trustee shall not be liable for interest on any money or
assets received by it except as the Trustee may agree with the Company. Assets
held in trust by the Trustee need not be segregated from other assets except to
the extent required by law.
Section 602. Notice of Defaults.
Within 30 days after a Responsible Officer of the Trustee receives
notice of the occurrence of any Default, the Trustee shall transmit by mail to
all Holders and any other Persons entitled to receive reports pursuant to
Section 313(c) of the Trust Indenture Act, as their names and addresses appear
in the Security Register, notice of such Default hereunder known to the Trustee,
unless such Default shall have been cured or waived; provided, however, that,
except in the case of a Default in the payment of the principal of, premium, if
any, or interest on any Security, the Trustee shall be protected in withholding
such notice if and so long as a trust committee of Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
interest of the Holders.
Section 603. Certain Rights of Trustee.
Subject to the provisions of Section 601 hereof and Trust Indenture
Act Sections 315(a) through 315(d):
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon receipt by it of any resolution, certificate,
statement, instrument,
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opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of Indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) the Trustee may consult with counsel of its selection and any
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon in accordance with such
advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee security or indemnity satisfactory to the Trustee against
the costs, expenses and liabilities which might be incurred therein or ,
(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture other than any
liabilities arising out of the negligence, bad faith or willful misconduct of
the Trustee;
(f) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
approval, appraisal, bond, debenture, note, coupon, security or other paper or
document unless requested in writing to do so by the Holders of not less than a
majority in aggregate principal amount of the Securities then Outstanding;
provided that, if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such expenses or liabilities as
a condition to proceeding; the reasonable expenses of every such investigation
so requested by the Holders of not less than 25% in aggregate principal amount
of the Securities Outstanding shall be paid by the Company or, if paid by the
Trustee or any predecessor Trustee, shall be repaid by the Company upon demand;
provided, further, the Trustee in its discretion may make such further inquiry
or investigation into such facts or matters as it may deem fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it shall
be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney; and
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(g) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.
(h) Except with respect to Section 1001, the Trustee shall have no
duty to inquire as to the performance of the Company with respect to the
covenants contained in Article 10. In addition, the Trustee shall not be deemed
to have knowledge of an Event of Default except (i) any Default or Event of
Default occurring pursuant to Sections 1001, 501(a) or 50l(b) or (ii) any
Default or Event of Default of which the Trustee shall have received written
notification or obtained actual knowledge.
(i) Delivery of reports, information and documents to the Trustee
under Section 1019 is for informational purposes only and the Trustee's receipt
of the foregoing shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of their covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officer's Certificates).
Section 604. Trustee Not Responsible for Recitals, Dispositions of
Securities or Application of Proceeds Thereof.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Guarantors, and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities, except that the Trustee
represents that it is duly authorized to execute and deliver this Indenture,
authenticate the Securities and perform its obligations hereunder and that the
statements made by it in any Statement of Eligibility and Qualification on Form
T-1 supplied to the Company are true and accurate subject to the qualifications
set forth therein. The Trustee shall not be accountable for the use or
application by the Company of Securities or the proceeds thereof.
Section 605. Trustee and Agents May Hold Securities; Collections; etc.
The Trustee, any Paying Agent, Security Registrar or any other agent
of the Company, in its individual or any other capacity, may become the owner or
pledgee of Securities, with the same rights it would have if it were not the
Trustee, Paying Agent, Security Registrar or such other agent and, subject to
Trust Indenture Act Sections 310 and 311, may otherwise deal with the Company
and receive, collect, hold and retain collections from the Company with the same
rights it would have if it were not the Trustee, Paying Agent, Security
Registrar or such other agent.
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Section 606. Money Held in Trust.
All moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received,
but need not be segregated from other funds except to the extent required by
mandatory provisions of law. Except for funds or securities deposited with the
Trustee pursuant to Article Four, the Trustee shall be required to invest all
moneys received by the Trustee, until used or applied as herein provided, in
Temporary Cash Investments in accordance with the directions of the Company.
Section 607. Compensation and Indemnification of Trustee and Its Prior
Claim.
The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation as the parties
shall agree in writing from time to time for all services rendered by it
hereunder (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) and the Company
covenants and agrees to pay or reimburse the Trustee and each predecessor
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by or on behalf of the Trustee in accordance with any of the
provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all agents and other persons
not regularly in its employ) except any such expense, disbursement or advance as
may arise from its negligence, bad faith or willful misconduct. The Company also
covenants and agrees to indemnify the Trustee and each predecessor Trustee for,
and to hold it harmless against, any claim, loss, liability, tax, assessment or
other governmental charge (other than taxes applicable to the Trustee's
compensation hereunder) or expense incurred without negligence, bad faith or
willful misconduct on its part, arising out of or in connection with the
acceptance or administration of this Indenture or the trusts hereunder and its
duties hereunder, including enforcement of this Section 607 and also including
any liability which the Trustee may incur as a result of failure to withhold,
pay or report any tax, assessment or other governmental charge, and the costs
and expenses of defending itself against or investigating any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The obligations of the Company under this Section 607 to compensate
and indemnify the Trustee and each predecessor Trustee and to pay or reimburse
the Trustee and each predecessor Trustee for reasonable expenses, disbursements
and advances shall constitute an additional obligation hereunder and shall
survive the satisfaction and discharge of this Indenture and the resignation or
removal of the Trustee and each predecessor Trustee.
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Section 608. Conflicting Interests.
The Trustee shall comply with the provisions of Section 310(b) of
the Trust Indenture Act.
Section 609. Trustee Eligibility.
There shall at all times be a Trustee hereunder which shall be
eligible to act as trustee under Trust Indenture Act Section 310(a) and is a
member of a bank holding company which shall have a combined capital and surplus
of at least $250,000,000, to the extent there is an institution eligible and
willing to serve. If the Trustee does not have a Corporate Trust Office in The
City of New York, the Trustee may appoint an agent in The City of New York
reasonably acceptable to the Company to conduct any activities which the Trustee
may be required under this Indenture to conduct in The City of New York. If such
Trustee publishes reports of condition at least annually, pursuant to law or to
the requirements of federal, state, territorial or District of Columbia
supervising or examining authority, then for the purposes of this Section 609,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 609, the Trustee shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
Section 610. Resignation and Removal; Appointment of Successor Trustee.
(a) No resignation or removal of the Trustee and no appointment of a
successor trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor trustee under Section 611.
(b) The Trustee, or any trustee or trustees hereafter appointed, may
at any time resign by giving written notice thereof to the Company no later than
20 Business Days prior to the proposed date of resignation. Upon receiving such
notice of resignation, the Company shall promptly appoint a successor trustee by
written instrument executed by authority of the Board of Directors of the
Company, a copy of which shall be delivered to the resigning Trustee and a copy
to the successor trustee. If an instrument of acceptance by a successor trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may, or any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper, appoint and
prescribe a successor trustee.
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(c) The Trustee may be removed at any time for any cause or for no
cause by an Act of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities, delivered to the Trustee and to
the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of
Trust Indenture Act Section 310(b) after written request therefor by
the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months,
(2) the Trustee shall cease to be eligible under Section 609
and shall fail to resign after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation,
then, in any case, (i) the Company by a Board Resolution may remove the Trustee,
or (ii) subject to Section 514, the Holder of any Security who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor trustee and
shall comply with the applicable requirements of Section 611. If, within 60 days
after such resignation, removal or incapability, or the occurrence of such
vacancy, the Company has not appointed a successor Trustee, a successor trustee
shall be appointed by the Act of the Holders of a majority in principal amount
of the Outstanding Securities delivered to the Company and the retiring Trustee.
Such successor trustee so appointed shall forthwith upon its acceptance of such
appointment become the successor trustee and supersede the successor trustee
appointed by the Company. If no successor trustee shall have been so appointed
by the Company or the Holders of the Securities and accepted appointment in the
manner hereinafter provided, the Trustee or the Holder of any Security who has
been a bona fide Holder for at least six months may, subject to Section 514, on
behalf of
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himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities as their names and addresses appear in the Security
Register. Each notice shall include the name of the successor trustee and the
address of its Corporate Trust Office or agent hereunder.
Section 611. Acceptance of Appointment by Successor.
Every successor trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee as if originally named as
Trustee hereunder; but, nevertheless, on the written request of the Company or
the successor trustee, upon payment of its charges pursuant to Section 607 then
unpaid, such retiring Trustee shall pay over to the successor trustee all moneys
at the time held by it hereunder and shall execute and deliver an instrument
transferring to such successor trustee all such rights, powers, duties and
obligations. Upon request of any such successor trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor trustee all such rights and powers.
No successor trustee with respect to the Securities shall accept
appointment as provided in this Section 611 unless at the time of such
acceptance such successor trustee shall be eligible to act as trustee under the
provisions of Trust Indenture Act Section 310(a) and this Article Six and shall
have a combined capital and surplus of at least $250,000,000 and have a
Corporate Trust Office or an agent selected in accordance with Section 609.
Upon acceptance of appointment by any successor trustee as provided
in this Section 611, the Company shall give notice thereof to the Holders of the
Securities, by mailing such notice to such Holders at their addresses as they
shall appear on the Security Register. If the acceptance of appointment is
substantially contemporaneous with the appointment, then the notice called for
by the preceding sentence may be combined with the notice called for by Section
610. If the Company fails to give such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be given at the expense of the Company.
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Section 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee (including the trust created by this Indenture) shall be
the successor of the Trustee hereunder, provided that such corporation shall be
eligible under Trust Indenture Act Section 310(a) and this Article Six and shall
have a combined capital and surplus of at least $250,000,000 and have a
Corporate Trust Office or an agent selected in accordance with Section 609,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
In case at the time such successor to the Trustee shall succeed to
the trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and, in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; provided that the right to adopt
the certificate of authentication of any predecessor Trustee or to authenticate
Securities in the name of any predecessor Trustee shall apply only to its
successor or successors by merger, conversion or consolidation.
Section 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or other obligor under the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor). A Trustee who has resigned or been
removed shall be subject to Trust Indenture Act Section 311(a) to the extent
indicated therein.
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
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(a) semiannually, not more than 10 days after each Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders as of such Regular Record Date; and
(b) at such other times as the Trustee may reasonably request in
writing, within 30 days after receipt by the Company of any such request, a list
of similar form and content to that in subsection (a) hereof as of a date not
more than 15 days prior to the time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Security
Registrar, no such list need be furnished.
Section 702. Disclosure of Names and Addresses of Holders.
Holders may communicate pursuant to Trust Indenture Act Section
312(b) with other Holders with respect to their rights under this Indenture or
the Securities, and the Trustee shall comply with Trust Indenture Act Section
312(b). The Company, the Trustee, the Security Registrar and any other Person
shall have the protection of Trust Indenture Act Section 312(c). Further, every
Holder of Securities, by receiving and holding the same, agrees with the Company
and the Trustee that neither the Company nor the Trustee or any agent of either
of them shall be held accountable by reason of the disclosure of any information
as to the names and addresses of the Holders in accordance with Trust Indenture
Act Section 312, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
any material pursuant to a request made under Trust Indenture Act Section 312.
Section 703. Reports by Trustee.
(a) Within 60 days after May 15 of each year commencing with the
first May 15 after the issuance of Securities, the Trustee, if so required under
the Trust Indenture Act, shall transmit by mail to all Holders, in the manner
and to the extent provided in Trust Indenture Act Section 313(c), a brief report
dated as of such May 15 in accordance with and with respect to the matters
required by Trust Indenture Act Section 313(a). The Trustee shall also transmit
by mail to all Holders, in the manner and to the extent provided in Trust
Indenture Act Section 313(c), a brief report in accordance with and with respect
to the matters required by Trust Indenture Act Section 313(b)(2).
(b) A copy of each report transmitted to Holders pursuant to this
Section 703 shall, at the time of such transmission, be mailed to the Company
and filed with each stock exchange, if any, upon which the Securities are listed
and also with the Commission. The Company will notify the Trustee promptly if
the Securities are listed on any stock exchange.
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Section 704. Reports by Company and Guarantors.
The Company and each Guarantor, as the case may be, shall:
(a) file with the Trustee, within 15 days after the Company or any
Guarantor, as the case may be, is required to file the same with the Commission,
copies of the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the Commission may from
time to time by rules and regulations prescribe) which the Company or any
Guarantor may be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Exchange Act; or, if the Company or any Guarantor, as the
case may be, is not required to file information, documents or reports pursuant
to either of said Sections, then it shall (i) deliver to the Trustee annual
audited financial statements of the Company and its Subsidiaries, prepared on a
Consolidated basis in conformity with GAAP, within 120 days after the end of
each fiscal year of the Company, and (ii) file with the Trustee and, to the
extent permitted by law, the Commission, in accordance with the rules and
regulations prescribed from time to time by the Commission, such of the
supplementary and periodic information, documents and reports which may be
required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations;
(b) file with the Trustee and the Commission, in accordance with the
rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by the
Company or any Guarantor, as the case may be, with the conditions and covenants
of this Indenture as are required from time to time by such rules and
regulations (including such information, documents and reports referred to in
Trust Indenture Act Section 314(a)); and
(c) within 15 days after the filing thereof with the Trustee,
transmit by mail to all Holders in the manner and to the extent provided in
Trust Indenture Act Section 313(c), such summaries of any information, documents
and reports required to be filed by the Company or any Guarantor, as the case
may be, pursuant to Section 1019 hereunder and subsections (a) and (b) of this
Section as are required by rules and regulations prescribed from time to time by
the Commission.
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ARTICLE EIGHT
CONSOLIDATION, MERGER, SALE OF ASSETS
Section 801. Company and Guarantors May Consolidate, etc., Only on
Certain Terms.
(a) The Company will not, in a single transaction or through a
series of related transactions, consolidate with or merge with or into any other
Person or sell, assign, convey, transfer, lease or otherwise dispose of all or
substantially all of its properties and assets to any Person or group of
Persons, or permit any of its Restricted Subsidiaries to enter into any such
transaction or series of related transactions if such transaction or series of
related transactions, in the aggregate, would result in a sale, assignment,
conveyance, transfer, lease or disposition of all or substantially all of the
properties and assets of the Company and its Restricted Subsidiaries on a
Consolidated basis to any other Person or group of Persons, unless at the time
and after giving effect thereto:
(i) either (a) the Company will be the continuing corporation
(in the case of a consolidation or merger involving the Company) or
(b) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person
which acquires by sale, assignment, conveyance, transfer, lease or
disposition all or substantially all of the properties and assets of
the Company and its Restricted Subsidiaries on a Consolidated basis
(the "Surviving Entity") will be a corporation duly organized and
validly existing under the laws of the United States of America, any
state thereof or the District of Columbia and such Person expressly
assumes, by a supplemental indenture, in a form reasonably
satisfactory to the Trustee, all the obligations of the Company
under the Securities and this Indenture and the Registration Rights
Agreement, as the case may be, and the Securities and this Indenture
and the Registration Rights Agreement will remain in full force and
effect as so supplemented;
(ii) immediately before and immediately after giving effect to
such transaction on a pro forma basis (and treating any Indebtedness
not previously an obligation of the Company or any of its Restricted
Subsidiaries which becomes the obligation of the Company or any of
its Restricted Subsidiaries as a result of such transaction as
having been incurred at the time of such transaction), no Default or
Event of Default will have occurred and be continuing;
(iii) immediately before and immediately after giving effect
to such transaction on a pro forma basis (on the assumption that the
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transaction occurred on the first day of the four-quarter period for
which financial statements are available ending immediately prior to
the consummation of such transaction with the appropriate
adjustments with respect to the transaction being included in such
pro forma calculation), the Company (or the Surviving Entity if the
Company is not the continuing obligor hereunder) could incur $1.00
of additional Indebtedness (other than Permitted Indebtedness) under
Section 1008;
(iv) at the time of the transaction, each Guarantor, if any,
unless it is the other party to the transactions described above,
will have by supplemental indenture confirmed that its Guarantee
shall apply to such Person's obligations under this Indenture and
under the Securities;
(v) at the time of the transaction if any of the property or
assets of the Company or any of its Restricted Subsidiaries would
thereupon become subject to any Lien, the provisions of Section 1011
are complied with; and
(vi) at the time of the transaction the Company or the
Surviving Entity will have delivered, or caused to be delivered, to
the Trustee, in form and substance reasonably satisfactory to the
Trustee, an Officers' Certificate and an Opinion of Counsel, each to
the effect that such consolidation, merger, transfer, sale,
assignment, conveyance, transfer, lease or other transaction and the
supplemental indenture in respect thereof comply with this Indenture
and that all conditions precedent herein provided for relating to
such transaction have been complied with.
(b) Each Guarantor will not, and the Company will not permit a
Guarantor to, in a single transaction or through a series of related
transactions, consolidate with or merge with or into any other Person (other
than the Company or any Guarantor) or sell, assign, convey, transfer, lease or
otherwise dispose of all or substantially all of its properties and assets on a
Consolidated basis to any Person or group of Persons (other than the Company or
any Guarantor), or permit any of its Restricted Subsidiaries to enter into any
such transaction or series of transactions if such transaction or series of
transactions, in the aggregate, would result in a sale, assignment, conveyance,
transfer, lease or disposition of all or substantially all of the properties and
assets of the Guarantor and its Restricted Subsidiaries on a Consolidated basis
to any other Person or group of Persons (other than the Company or any
Guarantor), unless at the time and after giving effect thereto:
(i) either (1) the Guarantor will be the continuing
corporation (in the case of a consolidation or merger involving the
Guarantor) or (2) the Person (if other than the Guarantor) formed by
such consolidation or into
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which such Guarantor is merged or the Person which acquires by sale,
assignment, conveyance, transfer, lease or disposition all or
substantially all of the properties and assets of the Guarantor and
its Restricted Subsidiaries on a Consolidated basis (the "Surviving
Guarantor Entity") duly organized and validly existing under the
laws of the United States of America, any state thereof or the
District of Columbia and such Person expressly assumes, by a
supplemental indenture, in a form satisfactory to the Trustee, all
the obligations of such Guarantor under its Guarantee of the
Securities and this Indenture and the Registration Rights Agreement
and such Guarantee, Indenture and Registration Rights Agreement will
remain in full force and effect;
(ii) immediately before and immediately after giving effect to
such transaction, on a pro forma basis, no Default or Event of
Default will have occurred and be continuing; and
(iii) at the time of the transaction such Guarantor or the
Surviving Guarantor Entity will have delivered, or caused to be
delivered, to the Trustee, in form and substance reasonably
satisfactory to the Trustee, an Officers' Certificate and an Opinion
of Counsel, each to the effect that such consolidation, merger,
transfer, sale, assignment, conveyance, lease or other transaction
and the supplemental indenture in respect thereof comply with this
Indenture and that all conditions precedent therein provided for
relating to such transaction have been complied with.
(c) Notwithstanding the foregoing, the provisions of Section 801(b)
shall not apply to any Guarantor whose Guarantee of the Notes is unconditionally
released and discharged in accordance with paragraph (b) under Section 1013.
Section 802. Successor Substituted.
Upon any consolidation or merger, or any sale, assignment,
conveyance, transfer, lease or disposition of all or substantially all of the
properties and assets of the Company or any Guarantor, if any, in accordance
with Section 801, the successor Person formed by such consolidation or into
which the Company or such Guarantor, as the case may be, is merged or the
successor Person to which such sale, assignment, conveyance, transfer, lease or
disposition is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company or such Guarantor, as the case may be,
under this Indenture, the Securities and/or the related Guarantee, as the case
may be, with the same effect as if such successor had been named as the Company
or such Guarantor, as the case may be, herein, in the Securities and/or in the
Guarantee, as the case may be, and the Company or such Guarantor, as the case
may be, shall be discharged from all obligations and covenants under this
Indenture and the Securities or its Guarantee, as the
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case may be; provided that in the case of a transfer by lease or a sale of
substantially all of the assets of the Company or a Guarantor that results in
the sale, assignment, conveyance, transfer or other disposition of assets
constituting or accounting for less than 95% of the consolidated assets ,
revenues or Consolidated Net Income (Loss) of the Company or such Guarantor, as
the case may be, the predecessor shall not be released from the payment of
principal and interest on the Securities or its Guarantee, as the case may be.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures and Agreements without Consent of
Holders.
Without the consent of any Holders, the Company, the Guarantors, if
any, and any other obligor under the Securities when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto or agreements or other instruments
with respect to this Indenture, the Securities or any Guarantee, in form and
substance satisfactory to the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company or a
Guarantor or any other obligor upon the Securities, and the assumption by any
such successor of the covenants of the Company or such Guarantor or obligor
herein and in the Securities and in any Guarantee in accordance with Article
Eight;
(b) to add to the covenants of the Company, any Guarantor or any
other obligor upon the Securities for the benefit of the Holders, or to
surrender any right or power conferred upon the Company or any Guarantor or any
other obligor upon the Securities, as applicable, herein, in the Securities or
in any Guarantee;
(c) to cure any ambiguity, or to correct or supplement any provision
herein or in any supplemental indenture, the Securities or any Guarantee which
may be defective or inconsistent with any other provision herein or in the
Securities or any Guarantee or to make any other provisions with respect to
matters or questions arising under this Indenture, the Securities or the
Guarantees; provided that, in each case, such provisions shall not adversely
affect the interest of the Holders;
(d) to comply with the requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust Indenture
Act, as contemplated by Section 905 or otherwise;
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(e) to add a Guarantor pursuant to the requirements of Section 1013
hereof or otherwise;
(f) to evidence and provide the acceptance of the appointment of a
successor trustee hereunder; or
(g) to mortgage, pledge, hypothecate or grant a security interest in
favor of the Trustee for the benefit of the Holders as additional security for
the payment and performance of the Company's or any Guarantor's Indenture
Obligations, in any property, or assets, including any of which are required to
be mortgaged, pledged or hypothecated, or in which a security interest is
required to be granted to the Trustee pursuant to this Indenture or otherwise.
Section 902. Supplemental Indentures and Agreements with Consent of
Holders.
Except as permitted by Section 901, with the consent of the Holders
of at least a majority in aggregate principal amount of the Outstanding
Securities, by Act of said Holders delivered to the Company, each Guarantor, if
any, and the Trustee, the Company and each Guarantor (if a party thereto) when
authorized by Board Resolutions, and the Trustee may (i) enter into an indenture
or indentures supplemental hereto or agreements or other instruments with
respect to any Guarantee in form and substance satisfactory to the Trustee, for
the purpose of adding any provisions to or amending, modifying or changing in
any manner or eliminating any of the provisions of this Indenture, the
Securities or any Guarantee (including but not limited to, for the purpose of
modifying in any manner the rights of the Holders under this Indenture, the
Securities or any Guarantee) or (ii) waive compliance with any provision in this
Indenture, the Securities or any Guarantee (other than waivers of past Defaults
covered by Section 513 and waivers of covenants which are covered by Section
1021); provided, however, that no such supplemental indenture, agreement or
instrument shall, without the consent of the Holder of each Outstanding Security
affected thereby:
(a) change the Stated Maturity of the principal of, or any
installment of interest on, or change to an earlier date any Redemption Date of,
or waive a default in the payment of the principal of, premium, if any, or
interest on, any such Security or reduce the principal amount thereof or the
rate of interest thereon or any premium payable upon the redemption thereof, or
change the coin or currency in which the principal of any Security or any
premium or the interest thereon is payable, or impair the right to institute
suit for the enforcement of any such payment on or after the Stated Maturity
thereof (or, in the case of redemption, on or after the Redemption Date);
(b) amend, change or modify the obligation of the Company to make
and consummate an Offer with respect to any Asset Sale or Asset Sales in
accordance with Section 1012 or the obligation of the Company to make and
consummate a Change
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of Control Offer in the event of a Change of Control in accordance with Section
1014, including, in each case, amending, changing or modifying any definitions
relating thereto but only to the extent such definitions relate thereto;
(c) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver or
compliance with certain provisions of this Indenture;
(d) modify any of the provisions of this Section 902 or Section 513
or 1022, except to increase the percentage of such Outstanding Securities
required for any such actions or to provide that certain other provisions of
this Indenture cannot be modified or waived without the consent of the Holder of
each such Security affected thereby;
(e) except as otherwise permitted under Article Eight, consent to
the assignment or transfer by the Company or any Guarantor of any of its rights
and obligations hereunder; or
(f) amend or modify any of the provisions of this Indenture in any
manner which subordinates the Securities issued hereunder in right of payment to
any other Indebtedness of the Company or which subordinates any Guarantee in
right of payment to any other Indebtedness of the Guarantor issuing such
Guarantee.
Upon the written request of the Company and each Guarantor, if any,
accompanied by a copy of Board Resolutions authorizing the execution of any such
supplemental indenture or Guarantee, and upon the filing with the Trustee of
evidence of the consent of Holders as aforesaid, the Trustee shall join with the
Company and each Guarantor in the execution of such supplemental indenture or
Guarantee.
It shall not be necessary for any Act of Holders under this Section
902 to approve the particular form of any proposed supplemental indenture or
Guarantee or agreement or instrument relating to any Guarantee, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 903. Execution of Supplemental Indentures and Agreements.
In executing, or accepting the additional trusts created by, any
supplemental indenture, agreement, instrument or waiver permitted by this
Article Nine or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Trust
Indenture Act Sections 315(a) through 315(d) and Section 603(a) hereof) shall be
fully protected in relying upon, an Opinion of Counsel and an Officers'
Certificate stating that the execution of such supplemental indenture, agreement
or instrument (a) is authorized or permitted by this Indenture and (b) does not
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violate the provisions of any agreement or instrument evidencing any other
Indebtedness of the Company, any Guarantor or any other Restricted Subsidiary.
The Trustee may, but shall not be obligated to, enter into any such supplemental
indenture, agreement or instrument which affects the Trustee's own rights,
duties or immunities under this Indenture, any Guarantee or otherwise.
Section 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article Nine
shall conform to the requirements of the Trust Indenture Act as then in effect.
Section 906. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article Nine may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and each Guarantor and authenticated and delivered by
the Trustee in exchange for Outstanding Securities.
Section 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company, any Guarantor and the
Trustee of any supplemental indenture pursuant to the provisions of Section 902,
the Company shall give notice thereof to the Holders of each Outstanding
Security affected, in the manner provided for in Section 106, setting forth in
general terms the substance of such supplemental indenture. 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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ARTICLE TEN
COVENANTS
Section 1001. Payment of Principal, Premium and Interest.
The Company shall duly and punctually pay the principal of, premium,
if any, and interest on the Securities in accordance with the terms of the
Securities and this Indenture.
Section 1002. Maintenance of Office or Agency.
The Company shall maintain an office or agency where Securities may
be presented or surrendered for payment. The Company also will maintain in The
City of New York an office or agency where Securities may be surrendered for
registration of transfer, redemption or exchange and where notices and demands
to or upon the Company in respect of the Securities and this Indenture may be
served. The office of the Trustee, at its Corporate Trust Office initially
located at 100 Wall Street, 20th Floor, New York, New York 10005, will be such
office or agency of the Company, unless the Company shall designate and maintain
some other office or agency for one or more of such purposes. The Company will
give prompt written notice to the Trustee of the location and any change in the
location of any such offices or agencies. If at any time the Company shall fail
to maintain any such required offices or agencies or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the office of the Trustee and the Company
hereby appoints the Trustee such agent as its agent to receive all such
presentations, surrenders, notices and demands.
The Company may from time to time designate one or more other
offices or agencies (in or outside of The City of New York) where the Securities
may be presented or surrendered for any or all such purposes, and may from time
to time rescind such designation. The Company will give prompt written notice to
the Trustee of any such designation or rescission and any change in the location
of any such office or agency.
The Trustee shall initially act as Paying Agent for the Securities.
Section 1003. Money for Security Payments to Be Held in Trust.
If the Company or any of its Affiliates shall at any time act as
Paying Agent, it will, on or before each due date of the principal of, premium,
if any, or interest on any of the Securities, segregate and hold in trust for
the benefit of the Holders entitled thereto a sum sufficient to pay the
principal, premium, if any, or interest so becoming due until such sums shall be
paid to such Persons or otherwise disposed of as herein provided, and will
promptly notify the Trustee of its action or failure so to act.
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If the Company or any of its Affiliates is not acting as Paying
Agent, the Company will, on or before each due date of the principal of,
premium, if any, or interest on any of the Securities, deposit with a Paying
Agent a sum in same day funds sufficient to pay the principal, premium, if any,
or interest so becoming due, such sum to be held in trust for the benefit of the
Persons entitled to such principal, premium or interest, and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of such
action or any failure so to act.
If the Company is not acting as Paying Agent, the Company will cause
each Paying Agent other than the Trustee to execute and deliver to the Trustee
an instrument in which such Paying Agent shall agree with the Trustee, subject
to the provisions of this Section, that such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on the Securities in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(b) give the Trustee notice of any Default by the Company or any
Guarantor (or any other obligor upon the Securities) in the making of any
payment of principal, premium, if any, or interest on the Securities;
(c) at any time during the continuance of any such Default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent; and
(d) acknowledge, accept and agree to comply in all aspects with the
provisions of this Indenture relating to the duties, rights and liabilities of
such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of, premium, if
any, or interest on any Security and remaining unclaimed for two years after
such principal and premium, if any, or interest has become due and payable shall
promptly be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look
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only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), and mail to each such
Holder, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification, publication and mailing, any unclaimed balance of such money then
remaining will promptly be repaid to the Company.
Section 1004. Corporate Existence.
Subject to Article Eight, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect the corporate
existence and related rights and franchises (charter and statutory) of the
Company and each Restricted Subsidiary; provided, however, that the Company
shall not be required to preserve any such right or franchise or the corporate
existence of any such Restricted Subsidiary if the Board of Directors of the
Company shall determine that the preservation thereof is no longer necessary or
desirable in the conduct of the business of the Company and its Restricted
Subsidiaries as a whole; and provided, further, however, that the foregoing
shall not prohibit a sale, transfer or conveyance of a Restricted Subsidiary or
any of its assets in compliance with the terms of this Indenture.
Section 1005. Payment of Taxes and Other Claims.
The Company shall pay or discharge or cause to be paid or
discharged, on or before the date the same shall become due and payable, (a) all
taxes, assessments and governmental charges levied or imposed upon the Company
or any of its Restricted Subsidiaries shown to be due on any return of the
Company or any of its Restricted Subsidiaries or otherwise assessed or upon the
income, profits or property of the Company or any of its Restricted Subsidiaries
if failure to pay or discharge the same could reasonably be expected to have a
material adverse effect on the ability of the Company or any Guarantor to
perform its obligations hereunder and (b) all lawful claims for labor, materials
and supplies, which, if unpaid, would by law become a Lien upon the property of
the Company or any of its Restricted Subsidiaries, except for any Lien permitted
to be incurred under Section 1011, if failure to pay or discharge the same could
reasonably be expected to have a material adverse effect on the ability of the
Company or any Guarantor to perform its obligations hereunder; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings properly instituted and diligently conducted and in respect of which
appropriate reserves (in the good faith judgment of management of the Company)
are being maintained in accordance with GAAP.
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Section 1006. Maintenance of Properties.
The Company shall cause all material properties owned by the Company
or any of its Restricted Subsidiaries or used or held for use in the conduct of
its business or the business of any of its Restricted Subsidiaries to be
maintained and kept in good condition, repair and working order (ordinary wear
and tear excepted) and supplied with all necessary equipment and will cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the reasonable judgment of the Company may be
consistent with sound business practice and necessary so that the business
carried on in connection therewith may be properly conducted at all times;
provided, however, that nothing in this Section shall prevent the Company from
discontinuing the maintenance of any of such properties if such discontinuance
is, in the reasonable judgment of the Company, desirable in the conduct of its
business or the business of any of its Restricted Subsidiaries; and provided,
further, however, that the foregoing shall not prohibit a sale, transfer or
conveyance of a Restricted Subsidiary or any of its properties or assets in
compliance with the terms of this Indenture.
Section 1007. Maintenance of Insurance.
The Company shall at all times keep all of its and its Restricted
Subsidiaries' properties which are of an insurable nature insured with insurers,
believed by the Company in good faith to be financially sound and responsible,
against loss or damage to the extent that property of similar character is
usually so insured by corporations similarly situated and owning like properties
in the same general geographic areas in which the Company and its Restricted
Subsidiaries operate, except where the failure to do so could not reasonably be
expected to have a material adverse effect on the condition (financial or
otherwise), earnings, business affairs or prospects of the Company and its
Restricted Subsidiaries, taken as a whole.
Section 1008. Limitation on Indebtedness.
The Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, create, issue, incur, assume, guarantee or otherwise
in any manner become directly or indirectly liable for the payment of or
otherwise incur, contingently or otherwise (collectively, "incur"), any
Indebtedness (including any Acquired Indebtedness), unless such Indebtedness is
incurred by the Company or any Guarantor or constitutes Acquired Indebtedness of
a Restricted Subsidiary and, in each case, the Company's Consolidated Fixed
Charge Coverage Ratio for the most recent four full fiscal quarters for which
financial statements are available immediately preceding the incurrence of such
Indebtedness taken as one period is at least equal to or greater than 2.0:1.
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Notwithstanding the foregoing, the Company and, to the extent
specifically set forth below, the Restricted Subsidiaries may incur each and all
of the following (collectively, the "Permitted Indebtedness"):
(i) Indebtedness of the Company and the Guarantors under the
Revolving Facility (including any refinancing (as defined below) thereof) in an
aggregate principal amount at any one time outstanding not to exceed the greater
of (a) $75 million or (b) 20% of the Company's Consolidated Tangible Assets, in
any case under the Revolving Facility (including any refinancing thereof) or in
respect of letters of credit thereunder;
(ii) Indebtedness of the Company and the Guarantors under any
Inventory Facility.
(iii) Indebtedness of the Company pursuant to the Securities and
Indebtedness of any Guarantor pursuant to a Guarantee of the Securities;
(iv) Indebtedness of the Company or any Restricted Subsidiary
outstanding on the Issue Date and listed on Schedule I hereto and not otherwise
referred to in this definition of Permitted Indebtedness;
(v) Indebtedness of the Company owing to a Restricted Subsidiary;
provided that any Indebtedness of the Company owing to a Restricted Subsidiary
that is not a Guarantor is made pursuant to an intercompany note in the form
attached as Annex A to this Indenture and is unsecured and subordinated in right
of payment from and after such time as the Securities shall become due and
payable (whether at Stated Maturity, acceleration or otherwise) to the payment
and performance of the Company's obligations under the Securities; provided,
further, that any disposition, pledge or transfer of any such Indebtedness to a
Person (other than a disposition, pledge or transfer to a Restricted Subsidiary)
shall be deemed to be an incurrence of such Indebtedness by the Company or other
obligor not permitted by this clause (v);
(vi) Indebtedness of a Wholly Owned Restricted Subsidiary owing to
the Company or another Wholly Owned Restricted Subsidiary; provided that any
such Indebtedness is made pursuant to an intercompany note in the form attached
as Annex A to this Indenture; provided, further, that (a) any disposition,
pledge or transfer of any such Indebtedness to a Person (other than a
disposition, pledge or transfer to the Company or a Wholly Owned Restricted
Subsidiary) shall be deemed to be an incurrence of such Indebtedness by the
obligor not permitted by this clause (vi), and (b) any transaction pursuant to
which any Wholly Owned Restricted Subsidiary, which has Indebtedness owing to
the Company or any other Wholly Owned Restricted Subsidiary, ceases to be a
Wholly Owned Restricted Subsidiary shall be deemed to be the incurrence of
Indebtedness by such Wholly Owned Restricted Subsidiary that is not permitted by
this clause (vi);
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(vii) guarantees of any Restricted Subsidiary made in accordance
with the provisions of Section 1013;
(viii)obligations of the Company or any Guarantor entered into in
the ordinary course of business (a) pursuant to Interest Rate Agreements
designed to protect the Company or any Restricted Subsidiary against
fluctuations in interest rates in respect of Indebtedness of the Company or any
Restricted Subsidiary as long as such obligations do not exceed the aggregate
principal amount of such Indebtedness then outstanding, (b) under any Currency
Hedging Agreements, relating to (i) Indebtedness of the Company or any
Restricted Subsidiary and/or (ii) obligations to purchase or sell assets or
properties, in each case, incurred in the ordinary course of business of the
Company or any Restricted Subsidiary; provided, however, that such Currency
Hedging Agreements do not increase the Indebtedness or other obligations of the
Company or any Restricted Subsidiary outstanding other than as a result of
fluctuations in foreign currency exchange rates or by reason of fees,
indemnities and compensation payable thereunder or (c) under any Commodity Price
Protection Agreements which do not increase the amount of Indebtedness or other
obligations of the Company or any Restricted Subsidiary outstanding other than
as a result of fluctuations in commodity prices or by reason of fees,
indemnities and compensation payable thereunder;
(ix) Indebtedness of the Company or any Restricted Subsidiary
represented by Capital Lease Obligations or Purchase Money Obligations or other
Indebtedness incurred or assumed in connection with the acquisition or
development of real or personal, movable or immovable, property in each case
incurred for the purpose of financing or refinancing all or any part of the
purchase price or cost of construction or improvement of property used in the
business of the Company, in an aggregate principal amount pursuant to this
clause (ix) not to exceed $20 million outstanding at any time; provided that the
principal amount of any Indebtedness permitted under this clause (ix) did not in
each case at the time of incurrence exceed the Fair Market Value, as determined
by the Board of Directors of the Company in good faith, of the acquired or
constructed asset or improvement so financed;
(x) obligations arising from agreements by the Company or a
Restricted Subsidiary to provide for indemnification, customary purchase price
closing adjustments, earn-outs or other similar obligations, in each case,
incurred in connection with the acquisition or disposition of any business or
assets of a Restricted Subsidiary;
(xi) Indebtedness evidenced by letters of credit in the ordinary
course of business to support the Company's or any Restricted Subsidiary's
insurance or self-insurance obligations for workers' compensation and other
similar insurance coverages;
(xii) any renewals, extensions, substitutions, refundings,
refinancings or replacements (collectively, a "refinancing") of any Indebtedness
described in clauses (iii)
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and (iv) of this definition of "Permitted Indebtedness," including any
successive refinancings so long as the borrower under such refinancing is the
Company or, if not the Company, the same as the borrower of the Indebtedness
being refinanced and the aggregate principal amount of Indebtedness represented
thereby (or if such Indebtedness provides for an amount less than the principal
amount thereof to be due and payable upon a declaration of acceleration of the
maturity thereof, the original issue price of such Indebtedness plus any
accreted value attributable thereto since the original issuance of such
Indebtedness) does not exceed the initial principal amount of such Indebtedness
plus the lesser of (I) the stated amount of any premium or other payment
required to be paid in connection with such a refinancing pursuant to the terms
of the Indebtedness being refinanced or (II) the amount of premium or other
payment actually paid at such time to refinance the Indebtedness, plus, in
either case, the amount of expenses of the Company incurred in connection with
such refinancing and (A) in the case of any refinancing of Indebtedness that is
Subordinated Indebtedness, such new Indebtedness is made subordinated to the
Securities at least to the same extent as the Indebtedness being refinanced and
(B) in the case of Pari Passu Indebtedness or Subordinated Indebtedness, as the
case may be, such refinancing does not reduce the Average Life to Stated
Maturity or the Stated Maturity of such Indebtedness; and
(xiii)Indebtedness of the Company and its Restricted Subsidiaries or
any Guarantor in addition to that described in clauses (i) through (xii) above,
and any renewals, extensions, substitutions, refinancings or replacements of
such Indebtedness, so long as the aggregate principal amount of all such
Indebtedness shall not exceed $10 million outstanding at any one time in the
aggregate.
For purposes of determining compliance with this Section 1008, in
the event that an item of Indebtedness meets the criteria of more than one of
the types of Indebtedness permitted by this Section 1008, the Company in its
sole discretion shall classify such item of Indebtedness and only be required to
include the amount of such Indebtedness as one of such types.
Section 1009. Limitation on Restricted Payments.
(a) The Company will not, and will not cause or permit any Restricted
Subsidiary to, directly or indirectly:
(i) declare or pay any dividend on, or make any distribution to
holders of, any shares of the Company's Capital Stock (other
than dividends or distributions payable solely in shares of
its Qualified Capital Stock or in options, warrants or other
rights to acquire shares of such Qualified Capital Stock);
(ii) purchase, redeem, defease or otherwise acquire or retire for
value, directly or indirectly, the Company's Capital Stock or
any Capital
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Stock of any Affiliate of the Company, including any
Subsidiary of the Company (other than Capital Stock of any
Wholly Owned Restricted Subsidiary of the Company), or
options, warrants or other rights to acquire such Capital
Stock;
(iii) make any principal payment on, or repurchase, redeem, defease,
retire or otherwise acquire for value, prior to any scheduled
principal payment, sinking fund payment or maturity, any
Subordinated Indebtedness;
(iv) declare or pay any dividend or distribution on any Capital
Stock of any Restricted Subsidiary to any Person (other than
(a) to the Company or any of its Wholly Owned Restricted
Subsidiaries or (b) dividends and distributions made by a
Restricted Subsidiary (i) organized as a partnership, limited
liability company or similar pass-through entity to the
holders of its Capital Stock in amounts sufficient to satisfy
the tax liabilities arising from their ownership of such
Capital Stock or (ii) on a pro rata basis to all stockholders
of such Restricted Subsidiary); or
(v) make any Investment in any Person (other than any Permitted
Investments)
(any of the foregoing actions described in clauses (i) through (v), other than
any such action that is a Permitted Payment (as defined below), collectively,
"Restricted Payments") (the amount of any such Restricted Payment, if other than
cash, shall be the Fair Market Value of the assets proposed to be transferred,
as determined by the board of directors of the Company, whose determination
shall be conclusive and evidenced by a board resolution), unless (1) immediately
before and immediately after giving effect to such proposed Restricted Payment
on a pro forma basis, no Default or Event of Default shall have occurred and be
continuing and such Restricted Payment shall not be an event which is, or after
notice or lapse of time or both, would be, an "event of default" under the terms
of any Indebtedness of the Company or its Restricted Subsidiaries; (2)
immediately before and immediately after giving effect to such Restricted
Payment on a pro forma basis, the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) under Section 1008 herein; and
(3) after giving effect to the proposed Restricted Payment, the aggregate amount
of all such Restricted Payments declared or made after the Issue Date and all
Designation Amounts does not exceed the sum of:
(A) $5 million;
(B) 50% of the aggregate Consolidated Net Income of the Company accrued
on a cumulative basis during the period beginning on the first day
of the
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Company's fiscal quarter in which the Issue Date occurs and ending
on the last day of the Company's last fiscal quarter in which the
Issue Date occurs ending prior to the date of the Restricted Payment
(or, if such aggregate cumulative Consolidated Net Income shall be a
loss, minus 100% of such loss);
(C) the aggregate Net Cash Proceeds received after the Issue Date by the
Company either (x) as capital contributions in the form of common
equity to the Company or (y) from the issuance or sale (other than
to any of its Subsidiaries) of Qualified Capital Stock of the
Company or any options, warrants or rights to purchase such
Qualified Capital Stock of the Company (except, in each case, to the
extent such proceeds are used to purchase, redeem or otherwise
retire Capital Stock or Subordinated Indebtedness as set forth below
in clause (ii) or (iii) of paragraph (b) below) (and excluding the
Net Cash Proceeds from the issuance of Qualified Capital Stock
financed, directly or indirectly, using funds borrowed from the
Company or any Subsidiary until and to the extent such borrowing is
repaid);
(D) the aggregate Net Cash Proceeds received after the Issue Date by the
Company (other than from any of its Subsidiaries) upon the exercise
of any options, warrants or rights to purchase Qualified Capital
Stock of the Company (and excluding the Net Cash Proceeds from the
exercise of any options, warrants or rights to purchase Qualified
Capital Stock financed, directly or indirectly, using funds borrowed
from the Company or any Subsidiary until and to the extent such
borrowing is repaid);
(E) the aggregate Net Cash Proceeds received after the Issue Date by the
Company from the conversion or exchange, if any, of debt securities
or Redeemable Capital Stock of the Company or its Restricted
Subsidiaries into or for Qualified Capital Stock of the Company
plus, to the extent such debt securities or Redeemable Capital Stock
were issued after the Issue Date, upon the conversion or exchange of
such debt securities or Redeemable Capital Stock the aggregate of
Net Cash Proceeds from their original issuance (and excluding the
Net Cash Proceeds from the conversion or exchange of debt securities
or Redeemable Capital Stock financed, directly or indirectly, using
funds borrowed from the Company or any Subsidiary until and to the
extent such borrowing is repaid); and
(F) (a) in the case of the disposition or repayment of any Investment
constituting a Restricted Payment made after the Issue Date, an
amount (to the extent not included in Consolidated Net Income) equal
to the lesser of the return of capital with respect to such
Investment and the initial amount of such Investment, in either
case, less the cost of the disposition of such
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Investment and net of taxes, and (b) in the case of the designation
of an Unrestricted Subsidiary as a Restricted Subsidiary (as long as
the designation of such Subsidiary as an Unrestricted Subsidiary was
deemed a Restricted Payment), the Fair Market Value of the Company's
interest in such Subsidiary provided that such amount shall not in
any case exceed the amount of the Restricted Payment deemed made at
the time the Subsidiary was designated as an Unrestricted
Subsidiary.
(b) Notwithstanding the foregoing, and in the case of clauses (ii) through
(iv) below, so long as no Default or Event of Default is continuing or would
arise therefrom, the foregoing provisions shall not prohibit the following
actions (each of clauses (i) through (iv) and (viii) being referred to as a
"Permitted Payment"):
(i) the payment of any dividend within 60 days after the
date of declaration thereof, if at such date of
declaration such payment was permitted by the provisions
of paragraph (a) of this Section and such payment shall
have been deemed to have been paid on such date of
declaration and shall not have been deemed a "Permitted
Payment" for purposes of the calculation required by
paragraph (a) of this Section 1009;
(ii) the repurchase, redemption, or other acquisition or
retirement for value of any shares of any class of
Capital Stock of the Company in exchange for (including
any such exchange pursuant to the exercise of a
conversion right or privilege in connection with which
cash is paid in lieu of the issuance of fractional
shares or scrip), or out of the Net Cash Proceeds of a
substantially concurrent issuance and sale for cash
(other than to a Subsidiary) of, other shares of
Qualified Capital Stock of the Company; provided that
the Net Cash Proceeds from the issuance of such shares
of Qualified Capital Stock are excluded from clause
(3)(C) of paragraph (a) of this Section 1009;
(iii) the repurchase, redemption, defeasance, retirement or
acquisition for value or payment of principal of any
Subordinated Indebtedness or Redeemable Capital Stock in
exchange for, or in an amount not in excess of the Net
Cash Proceeds of, a substantially concurrent issuance
and sale for cash (other than to any Subsidiary of the
Company) of any Qualified Capital Stock of the Company,
provided that the Net Cash Proceeds from the issuance of
such shares of
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Qualified Capital Stock are excluded from clause (3)(C)
of paragraph (a) of this Section 1009;
(iv) the repurchase, redemption, defeasance, retirement,
refinancing, acquisition for value or payment of
principal of any Subordinated Indebtedness (other than
Redeemable Capital Stock) (a "refinancing") through the
substantially concurrent issuance of new Subordinated
Indebtedness of the Company, provided that any such new
Subordinated Indebtedness (1) shall be in a principal
amount that does not exceed the principal amount so
refinanced (or, if such Subordinated Indebtedness
provides for an amount less than the principal amount
thereof to be due and payable upon a declaration of
acceleration thereof, then such lesser amount as of the
date of determination), plus the lesser of (I) the
stated amount of any premium or other payment required
to be paid in connection with such a refinancing
pursuant to the terms of the Indebtedness being
refinanced or (II) the amount of premium or other
payment actually paid at such time to refinance the
Indebtedness, plus, in either case, the amount of
expenses of the Company incurred in connection with such
refinancing; (2) has an Average Life to Stated Maturity
greater than the remaining Average Life to Stated
Maturity of the Securities; (3) has a Stated Maturity
for its final scheduled principal payment later than the
Stated Maturity for the final scheduled principal
payment of the Securities; and (4) is expressly
subordinated in right of payment to the Securities at
least to the same extent as the Subordinated
Indebtedness to be refinanced;
(v) the purchase, redemption, or other acquisition or
retirement for value of any class of Capital Stock of
the Company from employees, former employees, directors
or former directors of the Company or any Subsidiary
pursuant to the terms of the agreements to which such
Capital Stock was acquired in an amount not to exceed
$1.0 million in the aggregate in any calendar year;
(vi) the repurchase, redemption or other acquisition or
retirement for value of Capital Stock of the Company
issued pursuant to acquisitions by the Company to the
extent required by or needed to comply with the
requirements of any of the
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Manufacturers with which the Company or a Restricted
Subsidiary is a party to a franchise agreement;
(vii) the repurchase, redemption, defeasance, retirement or
acquisition for value or payment of principal on the
Smith Subordinated Loan; and
(viii) the payment of the contingent purchase price of an
acquisition to the extent such payment would be deemed a
Restricted Payment.
Section 1010. Limitation on Transactions with Affiliates.
The Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into any transaction
or series of related transactions (including, without limitation, the sale,
purchase, exchange or lease of assets, property or services) with or for the
benefit of any Affiliate of the Company (other than the Company or a Wholly
Owned Restricted Subsidiary) unless such transaction or series of related
transactions is entered into in good faith and in writing and (a) such
transaction or series of related transactions is on terms that are no less
favorable to the Company or such Restricted Subsidiary, as the case may be, than
those that would be available in a comparable transaction in arm's-length
dealings with an unrelated third party, (b) with respect to any transaction or
series of related transactions involving aggregate value in excess of $500,000,
the Company delivers an Officers' Certificate to the Trustee certifying that
such transaction or series of related transactions complies with clause (a)
above or such transaction or series of related transactions is approved by a
majority of the Disinterested Directors of the Board of Directors, or in the
event there is only one Disinterested Director, by such Disinterested Director,
and (c) with respect to any transaction or series of related transactions
involving aggregate value in excess of $1 million, either (A) such transaction
or series of related transactions has been approved by a majority of the
Disinterested Directors of the Company, or in the event there is only one
Disinterested Director, by such Disinterested Director, or (B) the Company
delivers to the Trustee a written opinion of an investment banking firm of
national standing or other recognized independent expert with experience
appraising the terms and conditions of the type of transaction or series of
related transactions for which an opinion is required stating that the
transactions or series of related transactions is fair to the Company or such
Restricted Subsidiary from a financial point of view; provided, however, that
this provision shall not apply to (i) compensation and employee benefit
arrangements with any officer or director of the Company, including under any
stock option or stock incentive plans, entered into in the ordinary course of
business; (ii) any transaction permitted as a Restricted Payment pursuant to
Section 1009; (iii) the payment of customary fees to directors of the Company
and its Restricted Subsidiaries; (iv) any transaction with any officer or member
of the Board of Directors of the Company
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involving indemnification arrangements; and (v) loans or advances to officers of
the Company in the ordinary course of business not to exceed $1 million in any
calendar year.
Section 1011. Limitation on Liens.
The Company will not, and will not cause or permit any Restricted
Subsidiary to, directly or indirectly, create, incur or affirm any Lien of any
kind securing any Pari Passu Indebtedness or Subordinated Indebtedness
(including any assumption, guarantee or other liability with respect thereto by
any Restricted Subsidiary) upon any property or assets (including any
intercompany notes) of the Company or any Restricted Subsidiary owned on the
Issue Date or acquired after the Issue Date, or assign or convey any right to
receive any income or profits therefrom, unless the Securities or a Guarantee in
the case of Liens of a Guarantor are directly secured equally and ratably with
(or, in the case of Subordinated Indebtedness, prior or senior thereto, with the
same relative priority as the Securities shall have with respect to such
Subordinated Indebtedness) the obligation or liability secured by such Lien
except for Liens (A) securing any Indebtedness which became Indebtedness
pursuant to a transaction permitted under Article Eight or securing Acquired
Indebtedness which was created prior to (and not created in connection with, or
in contemplation of) the incurrence of such Pari Passu Indebtedness or
Subordinated Indebtedness (including any assumption, guarantee or other
liability with respect thereto by any Restricted Subsidiary) and which
Indebtedness is permitted under the provisions of Section 1008 or (B) securing
any Indebtedness incurred in connection with any refinancing, renewal,
substitutions or replacements of any such Indebtedness described in clause (A),
so long as the aggregate principal amount of Indebtedness represented thereby
(or if such Indebtedness provides for an amount less than the principal amount
thereof to be due and payable upon a declaration of acceleration of the maturity
thereof, the original issue price of such Indebtedness plus any accreted value
attributable thereto since the original issuance of such Indebtedness) is not
increased by such refinancing by an amount greater than the lesser o (i) the
stated amount of any premium or other payment required to be paid in connection
with such a refinancing pursuant to the terms of the Indebtedness being
refinanced or (ii) the amount of premium or other payment actually paid at such
time to refinance the Indebtedness, plus, in either case, the amount of expenses
of the Company incurred in connection with such refinancing; provided, however,
that in the case of clauses (A) and (B), any such Lien only extends to the
assets that were subject to such Lien securing such Indebtedness prior to the
related acquisition by the Company or its Restricted Subsidiaries.
Notwithstanding the foregoing, any Lien securing the Securities granted pursuant
to this covenant shall be automatically and unconditionally released and
discharged upon the release by the holders of the Pari Passu Indebtedness or
Subordinated Indebtedness described above of their Lien on the property or
assets of the Company or any Restricted Subsidiary (including any deemed release
upon payment in full of all obligations under such Indebtedness), at such time
as the holders of all such Pari Passu Indebtedness or
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Subordinated Indebtedness also release their Lien on the property or assets of
the Company or such Restricted Subsidiary, or upon any sale, exchange or
transfer to any Person not an Affiliate of the Company of the property or assets
secured by such Lien, or of all of the Capital Stock held by the Company or any
Restricted Subsidiary in, or all or substantially all the assets of, any
Restricted Subsidiary creating such Lien.
Section 1012. Limitation on Sale of Assets.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, consummate an Asset Sale unless (i) at
least 80% of the consideration from such Asset Sale consists of (A) cash or Cash
Equivalents, (B) the assumption of Senior Indebtedness or Senior Guarantor
Indebtedness by the party acquiring the assets from the Company of any
Restricted Subsidiary, (C) Replacement Assets or (D) a combination of any of the
foregoing; and (ii) the Company or such Restricted Subsidiary receives
consideration at the time of such Asset Sale at least equal to the Fair Market
Value of the shares or assets subject to such Asset Sale (as determined by the
Board of Directors of the Company and evidenced in a Board Resolution); provided
that any notes or other obligations received by the Company or any such
Restricted Subsidiary from any transferee of assets from the Company or such
Restricted Subsidiary that are converted by the Company or such Restricted
Subsidiary into cash at Fair Market Value within 30 days after receipt shall be
deemed to be cash for purposes of this provision.
(b) If all or a portion of the Net Cash Proceeds of any Asset Sale
are not required to be applied to repay permanently any Senior Indebtedness or
Senior Guarantor Indebtedness then outstanding as required by the terms thereof,
or the Company determines not to apply such Net Cash Proceeds to the permanent
prepayment of such Senior Indebtedness or Senior Guarantor Indebtedness, or if
no such Senior Indebtedness or Senior Guarantor Indebtedness is then
outstanding, then the Company or a Restricted Subsidiary may within 365 days of
the Asset Sale invest the Net Cash Proceeds in Replacement Assets. The amount of
such Net Cash Proceeds not used or invested within 365 days of the Asset Sale as
set forth in this paragraph constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds exceeds $10 million
or more, the Company will apply the Excess Proceeds to the repayment of the
Securities and any other Pari Passu Indebtedness outstanding with similar
provisions requiring the Company to make an offer to purchase such Indebtedness
with the proceeds from any Asset Sale as follows: (A) the Company will make an
offer to purchase (an "Offer") from all holders of the Securities in accordance
with the procedures set forth in this Indenture in the maximum principal amount
(expressed as a multiple of $1,000) of Securities that may be purchased out of
an amount (the "Security Amount") equal to the product of such Excess Proceeds
multiplied by a fraction, the numerator of which is the outstanding principal
amount of the Securities, and the denominator of which is the sum of the
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outstanding principal amount of the Securities and such Pari Passu Indebtedness
(subject to proration in the event such amount is less than the aggregate
Offered Price (as defined herein) of all Securities tendered) and (B) to the
extent required by such Pari Passu Indebtedness to permanently reduce the
principal amount of such Pari Passu Indebtedness, the Company will make an offer
to purchase or otherwise repurchase or redeem Pari Passu Indebtedness (a "Pari
Passu Offer") in an amount (the "Pari Passu Debt Amount") equal to the excess of
the Excess Proceeds over the Security Amount; provided that in no event will the
Company be required to make a Pari Passu Offer in a Pari Passu Debt Amount
exceeding the principal amount of such Pari Passu Indebtedness plus the amount
of any premium required to be paid to repurchase such Pari Passu Indebtedness.
The offer price for the Securities will be payable in cash in an amount equal to
100% of the principal amount of the Securities plus accrued and unpaid interest,
if any, to the date (the "Offer Date") such Offer is consummated (the "Offered
Price"), in accordance with the procedures set forth herein. To the extent that
the aggregate Offered Price of the Securities tendered pursuant to the Offer is
less than the Security Amount relating thereto or the aggregate amount of Pari
Passu Indebtedness that is purchased in a Pari Passu Offer is less than the Pari
Passu Debt Amount, the Company may use any remaining Excess Proceeds for general
corporate purposes. If the aggregate principal amount of Securities and Pari
Passu Indebtedness surrendered by holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Securities to be purchased on a pro rata
basis. Upon the completion of the purchase of all the Securities tendered
pursuant to an Offer and the completion of a Pari Passu Offer, the amount of
Excess Proceeds, if any, shall be reset at zero.
(d) When the aggregate amount of Excess Proceeds exceeds $10
million, such Excess Proceeds will, prior to any purchase of Securities
described in paragraph (c) above, be set aside by the Company in a separate
account pending (i) deposit with the Depositary or a paying agent of the amount
required to purchase the Securities tendered in an Offer or Pari Passu
Indebtedness tendered in a Pari Passu Offer, (ii) delivery by the Company of the
Offered Price to the holders of the Securities tendered in an Offer or Pari
Passu Indebtedness tendered in a Pari Passu Offer and (iii) the completion of
the purchase of all the Securities tendered pursuant to the Offer and the
completion of the Pari Passu Offer. Such Excess Proceeds may be invested in
Temporary Cash Investments, provided that the maturity date of any such
investment made after the amount of Excess Proceeds exceeds $10 million shall
not be later than the Offer Date. The Company shall be entitled to any interest
or dividends accrued, earned or paid on such Temporary Cash Investments;
provided that the Company shall not withdraw such interest from the separate
account if an Event of Default has occurred and is continuing.
(e) If the Company becomes obligated to make an Offer pursuant to
clause (c) above, the Securities and the Pari Passu Indebtedness shall be
purchased by the Company, at the option of the holders thereof, in whole or in
part in integral multiples of $1,000, on a date that is not earlier than 30 days
and not later than 60 days from the date
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the notice of the Offer is given to holders, or such later date as may be
necessary for the Company to comply with the requirements under the Exchange
Act.
(f) The Company will comply with the applicable tender offer rules,
including Rule 14e-1 under the Exchange Act, and any other applicable securities
laws or regulations in connection with an Offer.
(g) Subject to paragraph (e) above, within 30 days after the date on
which the amount of Excess Proceeds equals or exceeds $10 million, the Company
shall send or cause to be sent by first-class mail, postage prepaid, to the
Trustee and to each Holder, at his address appearing in the Security Register, a
notice stating or including:
(1) that the Holder has the right to require the Company to
repurchase, subject to proration, such Holder's Securities at the
Offered Price;
(2) the Offer Date;
(3) the instructions a Holder must follow in order to have his
Securities purchased in accordance with paragraph (c) of this
Section;
(4) (i) the most recently filed Annual Report on Form 10-K
(including audited consolidated financial statements) of the
Company, the most recent subsequently filed Quarterly Report on Form
10-Q, as applicable, and any Current Report on Form 8-K of the
Company filed subsequent to such Quarterly Report, other than
Current Reports describing Asset Sales otherwise described in the
offering materials (or corresponding successor reports) (or in the
event the Company is not required to prepare any of the foregoing
Forms, the comparable information required pursuant to Section
1020), (ii) a description of material developments, if any, in the
Company's business subsequent to the date of the latest of such
reports, (iii) if material, appropriate pro forma financial
information, and (iv) such other information, if any, concerning the
business of the Company which the Company in good faith believes
will enable such Holders to make an informed investment decision
regarding the Offer;
(5) the Offered Price;
(6) the names and addresses of the Paying Agent and the
offices or agencies referred to in Section 1002;
(7) that Securities must be surrendered prior to the Offer
Date to the Paying Agent at the office of the Paying Agent or to an
office or agency referred to in Section 1002 to collect payment;
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(8) that any Securities not tendered will continue to accrue
interest and that unless the Company defaults in the payment of the
Offered Price, any Security accepted for payment pursuant to the
Offer shall cease to accrue interest on and after the Offer Date;
(9) the procedures for withdrawing a tender; and
(10) that the Offered Price for any Security which has been
properly tendered and not withdrawn and which has been accepted for
payment pursuant to the Offer will be paid promptly following the
Offered Date.
(g) Holders electing to have Securities purchased hereunder will be
required to surrender such Securities at the address specified in the notice
prior to the Offer Date. Holders will be entitled to withdraw their election to
have their Securities purchased pursuant to this Section 1012 if the Company
receives, not later than one Business Day prior to the Offer Date, a telegram,
telex, facsimile transmission or letter setting forth (1) the name of the
Holder, (2) the certificate number of the Security in respect of which such
notice of withdrawal is being submitted, (3) the principal amount of the
Security (which shall be $1,000 or an integral multiple thereof) delivered for
purchase by the Holder as to which his election is to be withdrawn, (4) a
statement that such Holder is withdrawing his election to have such principal
amount of such Security purchased, and (5) the principal amount, if any, of such
Security (which shall be $1,000 or an integral multiple thereof) that remains
subject to the original notice of the Offer and that has been or will be
delivered for purchase by the Company.
(h) The Company shall (i) not later than the Offer Date, accept for
payment Securities or portions thereof tendered pursuant to the Offer, (ii) not
later than 10:00 a.m. (New York time) on the Offer Date, deposit with the
Trustee or with a Paying Agent an amount of money in same day funds (or New York
Clearing House funds if such deposit is made prior to the Offer Date) sufficient
to pay the aggregate Offered Price of all the Securities or portions thereof
which are to be purchased on that date and (iii) not later than 10:00 a.m. (New
York time) on the Offer Date, deliver to the Paying Agent an Officers'
Certificate stating the Securities or portions thereof accepted for payment by
the Company. The Paying Agent shall promptly mail or deliver to Holders of
Securities so accepted payment in an amount equal to the Offered Price of the
Securities purchased from each such Holder, and the Company shall execute 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. Any Securities not so accepted shall be promptly mailed or
delivered by the Paying Agent at the Company's expense to the Holder thereof.
For purposes of this Section 1012, the Company shall choose a Paying Agent which
shall not be the Company.
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Subject to applicable escheat laws, the Trustee and the Paying Agent
shall return to the Company any cash that remains unclaimed, together with
interest, if any, thereon, held by them for the payment of the Offered Price;
provided, however, that (x) to the extent that the aggregate amount of cash
deposited by the Company with the Trustee in respect of an Offer exceeds the
aggregate Offered Price of the Securities or portions thereof to be purchased,
then the Trustee shall hold such excess for the Company and (y) unless otherwise
directed by the Company in writing, promptly after the Business Day following
the Offer Date the Trustee shall return any such excess to the Company together
with interest or dividends, if any, thereon.
(i) Securities to be purchased shall, on the Offer Date, become due
and payable at the Offered Price and from and after such date (unless the
Company shall default in the payment of the Offered Price) such Securities shall
cease to bear interest. Such Offered Price shall be paid to such Holder promptly
following the later of the Offer Date and the time of delivery of such Security
to the relevant Paying Agent at the office of such Paying Agent by the Holder
thereof in the manner required. Upon surrender of any such Security for purchase
in accordance with the foregoing provisions, such Security shall be paid by the
Company at the Offered Price; provided, however, that installments of interest
whose Stated Maturity is on or prior to the Offer Date shall be payable to the
Person in whose name the Securities (or any Predecessor Securities) is
registered as such on the relevant Regular Record Dates according to the terms
and the provisions of Section 309; provided, further, that Securities to be
purchased are subject to proration in the event the Excess Proceeds are less
than the aggregate Offered Price of all Securities tendered for purchase, with
such adjustments as may be appropriate by the Trustee so that only Securities in
denominations of $1,000 or integral multiples thereof, shall be purchased. If
any Security tendered for purchase shall not be so paid upon surrender thereof
by deposit of funds with the Trustee or a Paying Agent in accordance with
paragraph (h) above, the principal thereof (and premium, if any, thereon) shall,
until paid, bear interest from the Offer Date at the rate borne by such
Security. Any Security that is to be purchased only in part shall be surrendered
to a Paying Agent at the office of such Paying Agent (with, if the Company, the
Security Registrar or the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar or the Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Company shall execute and the
Trustee shall authenticate and deliver to the Holder of such Security, without
service charge, one or more new Securities of any authorized denomination as
requested by such Holder in an aggregate principal amount equal to, and in
exchange for, the portion of the principal amount of the Security so surrendered
that is not purchased. The Company shall publicly announce the results of the
Offer on or as soon as practicable after the Offer Date.
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Section 1013. Limitation on Issuances of Guarantees of and Pledges for
Indebtedness.
(a) The Company will not cause or permit any Restricted Subsidiary,
other than a Guarantor, directly or indirectly, to secure the payment of any
Senior Indebtedness of the Company and the Company will not, and will not permit
any Restricted Subsidiary to, pledge any intercompany notes representing
obligations of any Restricted Subsidiary (other than a Guarantor) to secure the
payment of any Senior Indebtedness unless in each case such Restricted
Subsidiary simultaneously executes and delivers a supplemental indenture to this
Indenture providing for a guarantee of payment of the Securities by such
Restricted Subsidiary, which guarantee shall be on the same terms as the
guarantee of the Senior Indebtedness (if a guarantee of Senior Indebtedness is
granted by any such Restricted Subsidiary) except that the guarantee of the
Securities need not be secured and shall be subordinated to the claims against
such Restricted Subsidiary in respect of Senior Indebtedness to the same extent
as the Securities are subordinated to Senior Indebtedness of the Company under
this Indenture.
(b) The Company will not cause or permit any Restricted Subsidiary
(which is not a Guarantor), directly or indirectly, to guarantee, assume or in
any other manner become liable with respect to any Indebtedness of the Company
or any Restricted Subsidiary unless such Restricted Subsidiary simultaneously
executes and delivers a supplemental indenture to this Indenture providing for a
Guarantee of the Securities on the same terms as the guarantee of such
Indebtedness except that (A) such guarantee need not be secured unless required
pursuant to Section 1011, (B) if such Indebtedness is by its terms Senior
Indebtedness, any such assumption, guarantee or other liability of such
Restricted Subsidiary with respect to such Indebtedness shall be senior to such
Restricted Subsidiary's Guarantee of the Securities to the same extent as such
Senior Indebtedness is senior to the Securities and (C) if such Indebtedness is
by its terms expressly subordinated to the Securities, any such assumption,
guarantee or other liability of such Restricted Subsidiary with respect to such
Indebtedness shall be subordinated to such Restricted Subsidiary's Guarantee of
the Securities at least to the same extent as such Indebtedness is subordinated
to the Securities.
(c) Notwithstanding the foregoing, any Guarantee by a Restricted
Subsidiary of the Securities shall provide by its terms that it (and all Liens
securing the same) shall be automatically and unconditionally released and
discharged upon (i) any sale, exchange or transfer, to any Person not an
Affiliate of the Company, of all of the Company's Capital Stock in, or all or
substantially all the assets of, such Restricted Subsidiary, which transaction
is in compliance with the terms of this Indenture and pursuant to which
transaction such Subsidiary is released from all guarantees, if any, by it of
other Indebtedness of the Company or any Restricted Subsidiaries or (ii) the
release by the holders of the Indebtedness of the Company of their security
interest or their guarantee by such Restricted Subsidiary (including any deemed
release upon payment in
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full of all obligations under such Indebtedness), at such time as (A) no other
Indebtedness of the Company has been secured or guaranteed by such Restricted
Subsidiary, as the case may be, or (B) the holders of all such other
Indebtedness which is secured or guaranteed by such Restricted Subsidiary also
release their security interest in or guarantee by such Restricted Subsidiary
(including any deemed release upon payment in full of all obligations under such
Indebtedness).
Section 1014. Purchase of Securities upon a Change of Control.
(a) If a Change of Control shall occur at any time, then each Holder
shall have the right to require that the Company purchase such Holder's
Securities in whole or in part in integral multiples of $1,000, at a purchase
price (the "Change of Control Purchase Price") in cash in an amount equal to
101% of the principal amount of such Securities, plus accrued and unpaid
interest, if any, to the date of purchase (the "Change of Control Purchase
Date"), pursuant to the offer described below in this Section 1014 (the "Change
of Control Offer") and in accordance with the other procedures set forth in
subsections (b), (c), (d) and (e) of this Section 1014.
(b) Within 30 days of any Change of Control, the Company shall
notify the Trustee thereof and give written notice (a "Change of Control
Purchase Notice") of such Change of Control to each Holder by first-class mail,
postage prepaid, at his address appearing in the Security Register, stating
among other things:
(1) that a Change of Control has occurred, the date of such
event, and that such Holder has the right to require the Company to
repurchase such Holder's Securities at the Change of Control
Purchase Price;
(2) the circumstances and relevant facts regarding such Change
of Control (including, but not limited to, information with respect
to pro forma historical income, cash flow and capitalization after
giving effect to such Change of Control);
(3) (i) the most recently filed Annual Report on Form 10-K
(including audited consolidated financial statements) of the
Company, the most recent subsequently filed Quarterly Report on Form
10-Q, as applicable, and any Current Report on Form 8-K of the
Company filed subsequent to such Quarterly Report (or in the event
the Company is not required to prepare any of the foregoing Forms,
the comparable information required to be prepared by the Company
and any Guarantor pursuant to Section 1020), (ii) a description of
material developments, if any, in the Company's business subsequent
to the date of the latest of such reports and (iii) such other
information, if any, concerning the business of the Company which
the Company in good faith believes will enable such Holders to
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make an informed investment decision regarding the Change of Control
Offer;
(4) that the Change of Control Offer is being made pursuant to
this Section 1014 and that all Securities properly tendered pursuant
to the Change of Control Offer will be accepted for payment at the
Change of Control Purchase Price;
(5) the Change of Control Purchase Date, which shall be a
Business Day no earlier than 30 days nor later than 60 days from the
date such notice is mailed, or such later date as is necessary to
comply with requirements under the Exchange Act;
(6) the Change of Control Purchase Price;
(7) the names and addresses of the Paying Agent and the
offices or agencies referred to in Section 1002;
(8) that Securities must be surrendered on or prior to the
Change of Control Purchase Date to the Paying Agent at the office of
the Paying Agent or to an office or agency referred to in Section
1002 to collect payment;
(9) that the Change of Control Purchase Price for any Security
which has been properly tendered and not withdrawn will be paid
promptly following the Change of Control Offer Purchase Date;
(10) the procedures that a Holder must follow to accept a
Change of Control Offer or to withdraw such acceptance;
(11) that any Security not tendered will continue to accrue
interest; and
(12) that, unless the Company defaults in the payment of the
Change of Control Purchase Price, any Securities accepted for
payment pursuant to the Change of Control Offer shall cease to
accrue interest after the Change of Control Purchase Date.
(c) Upon receipt by the Company of the proper tender of Securities,
the Holder of the Security in respect of which such proper tender was made shall
(unless the tender of such Security is properly withdrawn) thereafter be
entitled to receive solely the Change of Control Purchase Price with respect to
such Security. Upon surrender of any such Security for purchase in accordance
with the foregoing provisions, such Security shall be paid by the Company at the
Change of Control Purchase Price; provided,
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however, that installments of interest whose Stated Maturity is on or prior to
the Change of Control Purchase Date shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such on the
relevant Regular Record Dates according to the terms and the provisions of
Section 309. If any Security tendered for purchase in accordance with the
provisions of this Section 1015 shall not be so paid upon surrender thereof, the
principal thereof (and premium, if any, thereon) shall, until paid, bear
interest from the Change of Control Purchase Date at the rate borne by such
Security. Holders electing to have Securities purchased will be required to
surrender such Securities to the Paying Agent at the address specified in the
Change of Control Purchase Notice at least one Business Day prior to the Change
of Control Purchase Date. Any Security that is to be purchased only in part
shall be surrendered to a Paying Agent at the office of such Paying Agent (with,
if the Company, the Security Registrar or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Security Registrar or the Trustee, as the case may be, duly
executed by, the Holder thereof or such Holder's attorney duly authorized in
writing), and the Company shall execute and the Trustee shall authenticate and
deliver to the Holder of such Security, without service charge, one or more new
Securities of any authorized denomination as requested by such Holder in an
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Security so surrendered that is not purchased.
(d) The Company shall (i) not later than the Change of Control
Purchase Date, accept for payment Securities or portions thereof tendered
pursuant to the Change of Control Offer, (ii) not later than 10:00 a.m. (New
York time) on the Change of Control Purchase Date, deposit with the Trustee or
with a Paying Agent an amount of money in same day funds sufficient to pay the
aggregate Change of Control Purchase Price of all the Securities or portions
thereof which are to be purchased as of the Change of Control Purchase Date and
(iii) not later than 10:00 a.m. (New York time) on the Change of Control
Purchase Date, deliver to the Paying Agent an Officers' Certificate stating the
Securities or portions thereof accepted for payment by the Company. The Paying
Agent shall promptly mail or deliver to Holders of Securities so accepted
payment in an amount equal to the Change of Control Purchase Price of the
Securities purchased from each such Holder, and the Company shall execute 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. Any Securities not so accepted shall be promptly mailed or
delivered by the Paying Agent at the Company's expense to the Holder thereof.
The Company will publicly announce the results of the Change of Control Offer on
the Change of Control Purchase Date. For purposes of this Section 1014, the
Company shall choose a Paying Agent which shall not be the Company.
(e) A tender made in response to a Change of Control Purchase Notice
may be withdrawn if the Company receives, not later than one Business Day prior
to the
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Change of Control Purchase Date, a telegram, telex, facsimile transmission or
letter, specifying, as applicable:
(1) the name of the Holder;
(2) the certificate number of the Security in respect of which
such notice of withdrawal is being submitted;
(3) the principal amount of the Security (which shall be
$1,000 or an integral multiple thereof) delivered for purchase by
the Holder as to which such notice of withdrawal is being submitted;
(4) a statement that such Holder is withdrawing his election
to have such principal amount of such Security purchased; and
(5) the principal amount, if any, of such Security (which
shall be $1,000 or an integral multiple thereof) that remains
subject to the original Change of Control Purchase Notice and that
has been or will be delivered for purchase by the Company.
(f) Subject to applicable escheat laws, the Trustee and the Paying
Agent shall return to the Company any cash that remains unclaimed, together with
interest or dividends, if any, thereon, held by them for the payment of the
Change of Control Purchase Price; provided, however, that, (x) to the extent
that the aggregate amount of cash deposited by the Company pursuant to clause
(ii) of paragraph (d) above exceeds the aggregate Change of Control Purchase
Price of the Securities or portions thereof to be purchased, then the Trustee
shall hold such excess for the Company and (y) unless otherwise directed by the
Company in writing, promptly after the Business Day following the Change of
Control Purchase Date the Trustee shall return any such excess to the Company
together with interest, if any, thereon.
(g) The Company shall comply, to the extent applicable, with the
applicable tender offer rules, including Rule 14e-1 under the Exchange Act, and
any other applicable securities laws or regulations in connection with a Change
of Control Offer.
(h) Notwithstanding the foregoing, the Company will not be required
to make a Change of Control Offer if a third party makes the Change of Control
Offer, in the manner, at the times and otherwise in compliance with the
requirements set forth in this Indenture applicable to a Change of Control Offer
made by the Company and purchases all the Securities validly tendered and not
withdrawn under such Change of Control Offer.
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Section 1015. Limitation on Subsidiary Preferred Stock.
The Company will not permit (a) any Restricted Subsidiary of the
Company to issue, sell or transfer any Preferred Stock, except for (i) Preferred
Stock issued or sold to, held by or transferred to the Company or a Wholly Owned
Restricted Subsidiary, and (ii) Preferred Stock issued by a Person prior to the
time (A) such Person becomes a Restricted Subsidiary, (B) such Person merges
with or into a Restricted Subsidiary or (C) a Restricted Subsidiary merges with
or into such Person; provided that such Preferred Stock was not issued or
incurred by such Person in anticipation of the type of transaction contemplated
by subclause (A), (B) or (C) or (b) any Person (other than the Company or a
Wholly Owned Restricted Subsidiary) to acquire Preferred Stock of any Restricted
Subsidiary from the Company or any Restricted Subsidiary, except, in the case of
clause (a) or (b), upon the acquisition of all the outstanding Capital Stock of
such Restricted Subsidiary in accordance with the terms of this Indenture.
Section 1016. Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries.
The Company will not, and will not cause or permit any of its
Restricted Subsidiaries to, directly or indirectly, create or otherwise cause to
exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to (i) pay dividends or make any other
distribution on its Capital Stock, or any other interest or participation in or
measured by its profits, (ii) pay any Indebtedness owed to the Company or any
other Restricted Subsidiary, (iii) make any Investment in the Company or any
other Restricted Subsidiary or (iv) transfer any of its properties or assets to
the Company or any other Restricted Subsidiary, except for: (a) any encumbrance
or restriction pursuant to an agreement in effect on the Issue Date; (b) any
encumbrance or restriction, with respect to a Restricted Subsidiary that is not
a Restricted Subsidiary of the Company on the Issue Date, in existence at the
time such Person becomes a Restricted Subsidiary of the Company and not incurred
in connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary, provided that such encumbrances and restrictions are not applicable
to the Company or any Restricted Subsidiary or the properties or assets of the
Company or any Restricted Subsidiary other than such Subsidiary which is
becoming a Restricted Subsidiary; (c) customary provisions contained in an
agreement that has been entered into for the sale or other disposition of all or
substantially all of the Capital Stock or assets of a Restricted Subsidiary;
provided, however, that the restrictions are applicable only to such Restricted
Subsidiary or assets; (d) any encumbrance or restriction existing under or by
reason of applicable law; (e) customary provisions restricting subletting or
assignment of any lease governing any leasehold interest of any Restricted
Subsidiary; (f) covenants in franchise agreements with Manufacturers customary
for franchise agreements in the automobile retailing industry; (g) any
encumbrance or restriction contained in any Purchase Money Obligations for
property to the extent such restriction or encumbrance restricts the
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transfer of such property; (h) any encumbrances or restrictions in security
agreements securing Indebtedness (other than Subordinated Indebtedness) of a
Guarantor (including any Inventory Facility) (to the extent that such Liens are
otherwise incurred in accordance with Section 1011) that restrict the transfer
of property subject to such agreements, provided that any such encumbrance or
restriction is released to the extent the underlying Lien is released or the
related Indebtedness is repaid; and (i) any encumbrance or restriction existing
under any agreement that extends, renews, refinances or replaces the agreements
containing the encumbrances or restrictions in the foregoing clauses (a) and
(b), or in this clause (i), provided that the terms and conditions of any such
encumbrances or restrictions are no more restrictive in any material respect
than those under or pursuant to the agreement evidencing the Indebtedness so
extended, renewed, refinanced or replaced.
Section 1017. Limitation on Senior Subordinated Indebtedness.
The Company will not, and will not permit or cause any Guarantor to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise in
any manner become directly or indirectly liable for or with respect to or
otherwise permit to exist any Indebtedness that is subordinate in right of
payment to any Indebtedness of the Company or such Guarantor, as the case may
be, unless such Indebtedness is also pari passu with the Securities or the
Guarantee of such Guarantor or subordinated in right of payment to the
Securities or such Guarantee at least to the same extent as the Securities or
such Guarantee are subordinated in right of payment to Senior Indebtedness or
Senior Indebtedness of such Guarantor, as the case may be, as set forth in this
Indenture.
Section 1018. Limitations on Unrestricted Subsidiaries.
The Company may designate after the Issue Date any Subsidiary as an
"Unrestricted Subsidiary" under this Indenture (a "Designation") only if:
(a) no Default shall have occurred and be continuing at the time of
or after giving effect to such Designation;
(b) the Company would be permitted to make an Investment (other than
a Permitted Investment) at the time of Designation (assuming the effectiveness
of such Designation) pursuant to the first paragraph of Section 1009 herein in
an amount (the "Designation Amount") equal to the greater of (1) the net book
value of the Company's interest in such Subsidiary calculated in accordance with
GAAP or (2) the Fair Market Value of the Company's interest in such Subsidiary
as determined in good faith by the Company's board of directors;
(c) the Company would be permitted to incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to Section 1008 at the
time of such Designation (assuming the effectiveness of such Designation);
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(d) such Unrestricted Subsidiary does not own any Capital Stock in
any Restricted Subsidiary of the Company which is not simultaneously being
designated an Unrestricted Subsidiary;
(e) such Unrestricted Subsidiary is not liable, directly or
indirectly, with respect to any Indebtedness other than Unrestricted Subsidiary
Indebtedness, provided that an Unrestricted Subsidiary may provide a Guarantee
for the Securities; and
(f) such Unrestricted Subsidiary is not a party to any agreement,
contract, arrangement or understanding at such time with the Company or any
Restricted Subsidiary unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of the Company or, in the event such condition is not
satisfied, the value of such agreement, contract, arrangement or understanding
to such Unrestricted Subsidiary shall be deemed a Restricted Payment.
In the event of any such Designation, the Company shall be deemed to
have made an Investment constituting a Restricted Payment pursuant to Section
1009 for all purposes of this Indenture in the Designation Amount.
The Company shall not and shall not cause or permit any Restricted
Subsidiary to at any time (x) provide credit support for, or subject any of its
property or assets (other than the Capital Stock of any Unrestricted Subsidiary)
to the satisfaction of, any Indebtedness of any Unrestricted Subsidiary
(including any undertaking, agreement or instrument evidencing such
Indebtedness) (other than Permitted Investments in Unrestricted Subsidiaries) or
(y) be directly or indirectly liable for any Indebtedness of any Unrestricted
Subsidiary. For purposes of the foregoing, the Designation of a Subsidiary of
the Company as an Unrestricted Subsidiary shall be deemed to be the Designation
of all of the Subsidiaries of such Subsidiary.
The Company may revoke any Designation of a Subsidiary as an
Unrestricted Subsidiary (a "Revocation") if:
(a) no Default shall have occurred and be continuing at the time of
and after giving effect to such Revocation;
(b) all Liens and Indebtedness of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if incurred at such
time, have been permitted to be incurred for all purposes of this Indenture; and
(c) unless such redesignated Subsidiary shall not have any
Indebtedness outstanding (other than Indebtedness that would be Permitted
Indebtedness), immediately after giving effect to such proposed Revocation, and
after giving pro forma effect to the
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incurrence of any such Indebtedness of such redesignated Subsidiary as if such
Indebtedness was incurred on the date of the Revocation, the Company could incur
$1.00 of additional Indebtedness (other than Permitted Indebtedness) pursuant to
Section 1008 herein.
All Designations and Revocations must be evidenced by a resolution
of the Board of Directors of the Company delivered to the Trustee certifying
compliance with the foregoing provisions.
Section 1019. Provision of Financial Statements.
Whether or not the Company is subject to Section 13(a) or 15(d) of
the Exchange Act, the Company and each Guarantor (to the extent such Guarantor
would be required if subject to Section 13(a) or 15(d) of the Exchange Act)
will, to the extent permitted under the Exchange Act, file with the Commission
the annual reports, quarterly reports and other documents which the Company and
such Guarantor would have been required to file with the Commission pursuant to
Sections 13(a) or 15(d) if the Company or such Guarantor were so subject, such
documents to be filed with the Commission on or prior to the date (the "Required
Filing Date") by which the Company and such Guarantor would have been required
so to file such documents if the Company and such Guarantor were so subject. The
Company will also in any event (x) within 15 days of each Required Filing Date
(i) transmit by mail to all Holders, as their names and addresses appear in the
Security Register, without cost to such Holders and (ii) file with the Trustee
copies of the annual reports, quarterly reports and other documents which the
Company and such Guarantor would have been required to file with the Commission
pursuant to Sections 13(a) or 15(d) of the Exchange Act if the Company and such
Guarantor were subject to either of such Sections and (y) if filing such
documents by the Company and such Guarantor with the Commission is not permitted
under the Exchange Act, promptly upon written request and payment of the
reasonable cost of duplication and delivery, supply copies of such documents to
any prospective Holder at the Company's cost. If any Guarantor's financial
statements would be required to be included in the financial statements filed or
delivered pursuant to this Indenture if the Company were subject to Section
13(a) or 15(d) of the Exchange Act, the Company shall include such Guarantor's
financial statements in any filing or delivery pursuant to this Indenture. In
addition, so long as any of the Securities remain outstanding, the Company will
make available to any prospective purchaser of Securities or beneficial owner of
Securities in connection with any sale thereof the information required by Rule
144A(d)(4) under the Securities Act, until such time as the Company has either
exchanged the Securities for securities identical in all material respects which
have been registered under the Securities Act or until such time as the Holders
thereof have disposed of such Securities pursuant to an effective registration
statement under the Securities Act.
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Section 1020. Statement by Officers as to Default.
(a) The Company will deliver to the Trustee, on or before a date not
more than 120 days after the end of each fiscal year of the Company ending after
the date hereof, and 60 days after the end of each fiscal quarter ending after
the date hereof, a written statement signed by two executive officers of the
Company and the Guarantors, one of whom shall be the principal executive
officer, principal financial officer or principal accounting officer of the
Company and the Guarantors, as to compliance herewith, including whether or not,
after a review of the activities of the Company during such year and of the
Company's and each Guarantor's performance under this Indenture, to the best
knowledge, based on such review, of the signers thereof, the Company and each
Guarantor have fulfilled all of their respective obligations and are in
compliance with all conditions and covenants under this Indenture throughout
such year and, if there has been a Default specifying each Default and the
nature and status thereof and any actions being taken by the Company with
respect thereto.
(b) When any Default or Event of Default has occurred and is
continuing, or if the Trustee or any Holder or the trustee for or the holder of
any other evidence of Indebtedness of the Company or any Subsidiary gives any
notice or takes any other action with respect to a claimed default the Company
shall deliver to the Trustee by registered or certified mail or facsimile
transmission followed by an originally executed copy of an Officers' Certificate
specifying such Default, Event of Default, notice or other action, the status
thereof and what actions the Company is taking or proposes to take with respect
thereto, within five Business Days after the occurrence of such Default or Event
of Default.
Section 1021. Waiver of Certain Covenants.
The Company may omit in any particular instance to comply with any
covenant or condition set forth in Sections 1006 through 1011, 1013 and 1015
through 1020, if, before or after the time for such compliance, the Holders of
not less than a majority in aggregate principal amount of the Securities at the
time Outstanding shall, by Act of such Holders, waive such compliance in such
instance with such covenant or provision, but no such waiver shall extend to or
affect such covenant or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such covenant or condition shall remain
in full force and effect.
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ARTICLE ELEVEN
REDEMPTION OF SECURITIES
Section 1101. Rights of Redemption.
(a) The Securities are subject to redemption at any time on or after
August 1, 2003, at the option of the Company, in whole or in part, subject to
the conditions, and at the Redemption Prices, specified in the form of Security,
together with accrued and unpaid interest, if any, to the Redemption Date
(subject to the right of Holders of record on relevant Regular Record Dates and
Special Record Dates to receive interest due on relevant Interest Payment Dates
and Special Payment Dates).
(b) In addition, at any time prior to August 1, 2001, the Company
may, at its option, use the net proceeds of one or more Public Equity Offerings
to redeem up to an aggregate of 35% of the aggregate principal amount of
Securities originally issued under this Indenture at a redemption price equal to
111% of the of the principal amount thereof, plus accrued and unpaid interest
thereon, if any, to the Redemption Date; provided that at least 65% of the
initial aggregate principal amount of Securities remains outstanding immediately
after the occurrence of such redemption. In order to effect the foregoing
redemption, the Company must mail a notice of redemption no later than 30 days
after the closing of the related Public Equity Offering and must consummate such
redemption within 60 days of the closing of the Public Equity Offering.
Section 1102. Applicability of Article.
Redemption of Securities at the election of the Company or
otherwise, as permitted or required by any provision of this Indenture, shall be
made in accordance with such provision and this Article Eleven.
Section 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities pursuant to
Section 1101 shall be evidenced by a Company Order and an Officers' Certificate.
In case of any redemption at the election of the Company, the Company shall, not
less than 45 nor more than 60 days prior to the Redemption Date fixed by the
Company (unless a shorter notice period shall be satisfactory to the Trustee),
notify the Trustee in writing of such Redemption Date and of the principal
amount of Securities to be redeemed.
Section 1104. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities are to be redeemed, the particular
Securities or portions thereof to be redeemed in compliance with the national
security exchange, if any, on which the securities are listed, or if the
securities are not so listed, on a pro rata
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basis, by lot or by any other method the Trustee shall deem fair and reasonable;
provided, further, that any such redemption pursuant to the provisions relating
to a Public Equity offering shall be made on a pro rata basis or on as nearly a
pro rata basis as practicable (subject to the procedures of The Depositary Trust
Company or any other Depositary).
The Trustee shall promptly notify the Company and the Security
Registrar in writing of the Securities selected for redemption and, in the case
of any Securities selected for partial redemption, the principal amount thereof
to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Securities shall relate, in
the case of any Security redeemed or to be redeemed only in part, to the portion
of the principal amount of such Security which has been or is to be redeemed.
Section 1105. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 days nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at its address
appearing in the Security Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Securities are to be redeemed, the
identification of the particular Securities to be redeemed;
(d) in the case of a Security to be redeemed in part, the principal
amount of such Security to be redeemed and that after the Redemption Date upon
surrender of such Security, new Security or Securities in the aggregate
principal amount equal to the unredeemed portion thereof will be issued;
(e) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(f) that on the Redemption Date the Redemption Price will become
due and payable upon each such Security or portion thereof to be redeemed, and
that (unless the Company shall default in payment of the Redemption Price)
interest thereon shall cease to accrue on and after said date;
(g) the names and addresses of the Paying Agent and the offices or
agencies referred to in Section 1002 where such Securities are to be surrendered
for payment of the Redemption Price;
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(h) the CUSIP number, if any, relating to such Securities; and
(i) the procedures that a Holder must follow to surrender the
Securities to be redeemed.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's written request,
by the Trustee in the name and at the expense of the Company. If the Company
elects to give notice of redemption, it shall provide the Trustee with a
certificate stating that such notice has been given in compliance with the
requirements of this Section 1105.
The notice if mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice by mail or any defect in
the notice to the Holder of any Security designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security.
Section 1106. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent (or, if the Company or any of its Affiliates
is acting as Paying Agent, segregate and hold in trust as provided in Section
1003) an amount of money in same day funds sufficient to pay the Redemption
Price of, and (except if the Redemption Date shall be an Interest Payment Date
or Special Payment Date) accrued interest on, all the Securities or portions
thereof which are to be redeemed on that date. The Paying Agent shall promptly
mail or deliver to Holders of Securities so redeemed payment in an amount equal
to the Redemption Price of the Securities purchased from each such Holder. All
money, if any, earned on funds held in trust by the Trustee or any Paying Agent
shall be remitted to the Company. For purposes of this Section 1106, the Company
shall choose a Paying Agent which shall not be the Company.
Section 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Holders will be required
to surrender the Securities to be redeemed to the Paying Agent at the address
specified in the notice of redemption at least one Business Day prior to the
Redemption Date. Upon surrender of any such Security for redemption in
accordance with said notice, such Security shall be paid by the Company at the
Redemption Price together with accrued interest to the Redemption Date;
provided, however, that installments of interest whose Stated Maturity is on or
prior to the Redemption Date shall be payable to the Holders of such Securities,
or one or more
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Predecessor Securities, registered as such on the relevant Regular Record Dates
and Special Record Dates according to the terms and the provisions of Section
309.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear interest from the Redemption Date at the rate borne by such
Security.
Section 1108. Securities Redeemed or Purchased in Part.
Any Security which is to be redeemed or purchased only in part shall
be surrendered to the Paying Agent at the office or agency maintained for such
purpose pursuant to Section 1002 (with, if the Company, the Security Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company, the Security Registrar or the
Trustee, as the case may be, duly executed by, the Holder thereof or such
Holder's attorney duly authorized in writing), and the Company shall execute,
and the Trustee shall authenticate and deliver to the Holder of such Security
without service charge, a new Security or Securities, of any authorized
denomination as requested by such Holder in aggregate principal amount equal to,
and in exchange for, the unredeemed portion of the principal of the Security so
surrendered that is not redeemed or purchased.
ARTICLE TWELVE
SATISFACTION AND DISCHARGE
Section 1201. Satisfaction and Discharge of Indenture.
This Indenture shall be discharged and shall cease to be of further
effect (except as to surviving rights of registration of transfer or exchange of
Securities as expressly provided for herein) as to all Outstanding Securities
hereunder, and the Trustee, upon Company Request and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(a) either
(1) all the Securities theretofore authenticated and delivered
(except (i) lost, stolen or destroyed Securities which have been
replaced or paid as provided in Section 308 or (ii) all Securities
whose payment has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust as provided in Section 1003)
have been delivered to the Trustee for cancellation; or
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(2) all Securities not theretofore delivered to the Trustee
for cancellation (i) have become due and payable, (ii) will become
due and payable at their Stated Maturity within one year or (iii)
are to be called for redemption within one year under arrangements
reasonably satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company; and the Company or any Guarantor has irrevocably deposited
or caused to be deposited with the Trustee as trust funds in trust
an amount in United States dollars sufficient to pay and discharge
the entire Indebtedness on the Securities not theretofore delivered
to the Trustee for cancellation, including the principal of,
premium, if any, and accrued interest on, such Securities at such
Maturity, Stated Maturity or Redemption Date;
(b) the Company or any Guarantor has paid or caused to be paid all
other sums payable hereunder by the Company and any Guarantor; and
(c) the Company have delivered to the Trustee an Officers'
Certificate and an Opinion of Independent Counsel, in form and substance
reasonably satisfactory to the Trustee, each stating that (i) all conditions
precedent herein relating to the satisfaction and discharge hereof have been
complied with and (ii) such satisfaction and discharge will not result in a
breach or violation of, or constitute a default under, this Indenture or any
other material agreement or instrument to which the Company, any Guarantor or
any Restricted Subsidiary is a party or by which the Company, any Guarantor or
any Restricted Subsidiary is bound.
Notwithstanding the satisfaction and discharge hereof, the
obligations of the Company to the Trustee under Section 607 and, if United
States dollars shall have been deposited with the Trustee pursuant to subclause
(2) of subsection (a) of this Section 1201, the obligations of the Trustee under
Section 1202 and the last paragraph of Section 1003 shall survive.
Section 1202. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
United States dollars deposited with the Trustee pursuant to Section 1201 shall
be held in trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal of,
premium, if any, and interest on, the Securities for whose payment such United
States dollars have been deposited with the Trustee.
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ARTICLE THIRTEEN
GUARANTEES
Section 1301. Guarantors' Guarantee.
For value received, each of the Guarantors, in accordance with this
Article Thirteen, hereby absolutely, fully, unconditionally and irrevocably
guarantees, jointly and severally with each other and with each other Person
which may become a Guarantor hereunder, to the Trustee and the Holders, as if
the Guarantors were the principal debtor, the punctual payment and performance
when due of all Indenture Obligations (which for purposes of this Guarantee
shall also be deemed to include all commissions, fees, charges, costs and other
expenses (including reasonable legal fees and disbursements of one counsel)
arising out of or incurred by the Trustee or the Holders in connection with the
enforcement of this Guarantee).
Section 1302. Continuing Guarantee; No Right of Set-Off; Independent
Obligation.
(a) This Guarantee shall be a continuing guarantee of the payment
and performance of all Indenture Obligations and shall remain in full force and
effect until the payment in full of all of the Indenture Obligations and shall
apply to and secure any ultimate balance due or remaining unpaid to the Trustee
or the Holders; and this Guarantee shall not be considered as wholly or
partially satisfied by the payment or liquidation at any time or from time to
time of any sum of money for the time being due or remaining unpaid to the
Trustee or the Holders. Each Guarantor, jointly and severally, covenants and
agrees to comply with all obligations, covenants, agreements and provisions
applicable to it in this Indenture including those set forth in Article Eight.
Without limiting the generality of the foregoing, each Guarantor's liability
shall extend to all amounts which constitute part of the Indenture Obligations
and would be owed by the Company under this Indenture and the Securities but for
the fact that they are unenforceable, reduced, limited, impaired, suspended or
not allowable due to the existence of a bankruptcy, reorganization or similar
proceeding involving the Company.
(b) Each Guarantor, jointly and severally, hereby guarantees that
the Indenture Obligations will be paid to the Trustee without set-off or
counterclaim or other reduction whatsoever (whether for taxes, withholding or
otherwise) in lawful currency of the United States of America.
(c) Each Guarantor, jointly and severally, guarantees that the
Indenture Obligations shall be paid strictly in accordance with their terms
regardless of any law, regulation or order now or hereafter in effect in any
jurisdiction affecting any of such terms or the rights of the holders of the
Securities.
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(d) Each Guarantor's liability to pay or perform or cause the
performance of the Indenture Obligations under this Guarantee shall arise
forthwith after demand for payment or performance by the Trustee has been given
to the Guarantors in the manner prescribed in Section 106 hereof.
(e) Except as provided herein, the provisions of this Article
Thirteen cover all agreements between the parties hereto relative to this
Guarantee and none of the parties shall be bound by any representation, warranty
or promise made by any Person relative thereto which is not embodied herein; and
it is specifically acknowledged and agreed that this Guarantee has been
delivered by each Guarantor free of any conditions whatsoever and that no
representations, warranties or promises have been made to any Guarantor
affecting its liabilities hereunder, and that the Trustee shall not be bound by
any representations, warranties or promises now or at any time hereafter made by
the Company to any Guarantor.
(f) This Guarantee is a guarantee of payment, performance and
compliance and not of collectibility and is in no way conditioned or contingent
upon any attempt to collect from or enforce performance or compliance by the
Company or upon any event or condition whatsoever.
(g) The obligations of the Guarantors set forth herein constitute
the full recourse obligations of the Guarantors enforceable against them to the
full extent of all their assets and properties.
Section 1303. Guarantee Absolute.
The obligations of the Guarantors hereunder are independent of the
obligations of the Company under the Securities and this Indenture and a
separate action or actions may be brought and prosecuted against any Guarantor
whether or not an action or proceeding is brought against the Company and
whether or not the Company is joined in any such action or proceeding. The
liability of the Guarantors hereunder is irrevocable, absolute and unconditional
and (to the extent permitted by law) the liability and obligations of the
Guarantors hereunder shall not be released, discharged, mitigated, waived,
impaired or affected in whole or in part by:
(a) any defect or lack of validity or enforceability in respect of
any Indebtedness or other obligation of the Company or any
other Person under this Indenture or the Securities, or any
agreement or instrument relating to any of the foregoing;
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(b) any grants of time, renewals, extensions, indulgences,
releases, discharges or modifications which the Trustee or the
Holders may extend to, or make with, the Company, any
Guarantor or any other Person, or any change in the time,
manner or place of payment of, or in any other term of, all or
any of the Indenture Obligations, or any other amendment or
waiver of, or any consent to or departure from, this Indenture
or the Securities, including any increase or decrease in the
Indenture Obligations;
(c) the taking of security from the Company, any Guarantor or any
other Person, and the release, discharge or alteration of, or
other dealing with, such security;
(d) the occurrence of any change in the laws, rules, regulations
or ordinances of any jurisdiction by any present or future
action of any governmental authority or court amending,
varying, reducing or otherwise affecting, or purporting to
amend, vary, reduce or otherwise affect, any of the Indenture
Obligations and the obligations of any Guarantor hereunder;
(e) the abstention from taking security from the Company, any
Guarantor or any other Person or from perfecting, continuing
to keep perfected or taking advantage of any security;
(f) any loss, diminution of value or lack of enforceability of any
security received from the Company, any Guarantor or any other
Person, and including any other guarantees received by the
Trustee;
(g) any other dealings with the Company, any Guarantor or any
other Person, or with any security;
(h) the Trustee's or the Holders' acceptance of compositions from
the Company or any Guarantor;
(i) the application by the Holders or the Trustee of all monies at
any time and from time to time received from the Company, any
Guarantor or any other Person on account of any indebtedness
and liabilities owing by the Company or any Guarantor to the
Trustee or the Holders, in such manner as the Trustee or the
Holders deems best and the changing of such application in
whole or in part and at any time or from time to time, or any
manner of application of collateral,
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or proceeds thereof, to all or any of the Indenture Obligations, or
the manner of sale of any collateral;
(j) the release or discharge of the Company or any Guarantor of
the Securities or of any Person liable directly as surety or
otherwise by operation of law or otherwise for the Securities,
other than an express release in writing given by the Trustee,
on behalf of the Holders, of the liability and obligations of
any Guarantor hereunder;
(k) any change in the name, business, capital structure or
governing instrument of the Company or any Guarantor or any
refinancing or restructuring of any of the Indenture
Obligations;
(l) the sale of the Company's or any Guarantor's business or any
part thereof;
(m) subject to Section 1314, any merger or consolidation,
arrangement or reorganization of the Company, any Guarantor,
any Person resulting from the merger or consolidation of the
Company or any Guarantor with any other Person or any other
successor to such Person or merged or consolidated Person or
any other change in the corporate existence, structure or
ownership of the Company or any Guarantor or any change in the
corporate relationship between the Company and any Guarantor,
or any termination of such relationship;
(n) the insolvency, bankruptcy, liquidation, winding-up,
dissolution, receivership, arrangement, readjustment,
assignment for the benefit of creditors or distribution of the
assets of the Company or its assets or any resulting discharge
of any obligations of the Company (whether voluntary or
involuntary) or of any Guarantor (whether voluntary or
involuntary) or the loss of corporate existence;
(o) subject to Section 1314, any arrangement or plan of
reorganization affecting the Company or any Guarantor;
(p) any failure, omission or delay on the part of the Company to
conform or comply with any term of this Indenture;
(q) any limitation on the liability or obligations of the Company
or any other Person under this Indenture, or any discharge,
termination, cancellation, distribution, irregularity,
invalidity or unenforceability in whole or in part of this
Indenture;
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(r) any other circumstance (including any statute of limitations)
that might otherwise constitute a defense available to, or
discharge of, the Company or any Guarantor; or
(s) any modification, compromise, settlement or release by the
Trustee, or by operation of law or otherwise, of the Indenture
Obligations or the liability of the Company or any other
obligor under the Securities, in whole or in part, and any
refusal of payment by the Trustee, in whole or in part, from
any other obligor or other guarantor in connection with any of
the Indenture Obligations, whether or not with notice to, or
further assent by, or any reservation of rights against, each
of the Guarantors.
Section 1304. Right to Demand Full Performance.
In the event of any demand for payment or performance by the Trustee
from any Guarantor hereunder, the Trustee or the Holders shall have the right to
demand its full claim and to receive all dividends or other payments in respect
thereof until the Indenture Obligations have been paid in full, and the
Guarantors shall continue to be jointly and severally liable hereunder for any
balance which may be owing to the Trustee or the Holders by the Company under
this Indenture and the Securities. The retention by the Trustee or the Holders
of any security, prior to the realization by the Trustee or the Holders of its
rights to such security upon foreclosure thereon, shall not, as between the
Trustee and any Guarantor, be considered as a purchase of such security, or as
payment, satisfaction or reduction of the Indenture Obligations due to the
Trustee or the Holders by the Company or any part thereof. Each Guarantor,
promptly after demand, will reimburse the Trustee and the Holders for all costs
and expenses of collecting such amount under, or enforcing this Guarantee,
including, without limitation, the reasonable fees and expenses of counsel.
Section 1305. Waivers.
(a) Each Guarantor hereby expressly waives (to the extent permitted
by law) notice of the acceptance of this Guarantee and notice of the existence,
renewal, extension or the non-performance, non-payment, or non-observance on the
part of the Company of any of the terms, covenants, conditions and provisions of
this Indenture or the Securities or any other notice whatsoever to or upon the
Company or such Guarantor with respect to the Indenture Obligations, whether by
statute, rule of law or otherwise. Each Guarantor hereby acknowledges
communication to it of the terms of this Indenture and the Securities and all of
the provisions therein contained and consents to and
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approves the same. Each Guarantor hereby expressly waives (to the extent
permitted by law) diligence, presentment, protest and demand for payment with
respect to (i) any notice of sale, transfer or other disposition of any right,
title to or interest in the Securities by the Holders or in this Indenture, (ii)
any release of any Guarantor from its obligations hereunder resulting from any
loss by it of its rights of subrogation hereunder and (iii) any other
circumstances whatsoever that might otherwise constitute a legal or equitable
discharge, release or defense of a guarantor or surety or that might otherwise
limit recourse against such Guarantor.
(b) Without prejudice to any of the rights or recourses which the
Trustee or the Holders may have against the Company, each Guarantor hereby
expressly waives (to the extent permitted by law) any right to require the
Trustee or the Holders to:
(i) enforce, assert, exercise, initiate or exhaust any
rights, remedies or recourse against the Company, any
Guarantor or any other Person under this Indenture or
otherwise;
(ii) value, realize upon, or dispose of any security of the
Company or any other Person held by the Trustee or the
Holders;
(iii) initiate or exhaust any other remedy which the Trustee
or the Holders may have in law or equity; or
(iv) mitigate the damages resulting from any default under
this Indenture;
before requiring or becoming entitled to demand payment from such Guarantor
under this Guarantee.
Section 1306. The Guarantors Remain Obligated in Event the Company Is No
Longer Obligated to Discharge Indenture Obligations.
It is the express intention of the Trustee and the Guarantors that
if for any reason the Company has no legal existence, is or becomes under no
legal obligation to discharge the Indenture Obligations owing to the Trustee or
the Holders by the Company or if any of the Indenture Obligations owing by the
Company to the Trustee or the Holders becomes irrecoverable from the Company by
operation of law or for any reason whatsoever, this Guarantee and the covenants,
agreements and obligations of the Guarantors contained in this Article Thirteen
shall nevertheless be binding upon the Guarantors, as principal debtor, until
such time as all such Indenture Obligations have been paid in full to the
Trustee and all Indenture Obligations owing to the Trustee or the
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Holders by the Company have been discharged, or such earlier time as Section 402
shall apply to the Securities and the Guarantors shall be responsible for the
payment thereof to the Trustee or the Holders upon demand.
Section 1307. Fraudulent Conveyance; Contribution; Subrogation.
(a) Each Guarantor that is a Subsidiary of the Company, and by its
acceptance hereof each Holder, hereby confirms that it is the intention of all
such parties that the Guarantee by such 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 Guarantor hereby irrevocably agree that the obligations of such
Guarantor under its Guarantee shall be limited to the maximum amount which,
after giving effect to all other contingent and fixed liabilities of such
Guarantor, and after giving effect to any collections from or payments made by
or on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under its Guarantee or pursuant to its contribution obligations under
this Indenture, will result in the obligations of such Guarantor under its
Guarantee not constituting such fraudulent transfer or conveyance.
(b) Each Guarantor that makes a payment or distribution under its
Guarantee shall be entitled to a contribution from each other Guarantor, if any,
in a pro rata amount based on the net assets of each Guarantor, determined in
accordance with GAAP.
(c) Each Guarantor hereby waives all rights of subrogation or
contribution, whether arising by contract or operation of law (including,
without limitation, any such right arising under federal bankruptcy law) or
otherwise by reason of any payment by it pursuant to the provisions of this
Article Thirteen until payment in full of all Indenture Obligations.
Section 1308. Guarantee Is in Addition to Other Security.
This Guarantee shall be in addition to and not in substitution for
any other guarantees or other security which the Trustee may now or hereafter
hold in respect of the Indenture Obligations owing to the Trustee or the Holders
by the Company and (except as may be required by law) the Trustee shall be under
no obligation to marshal in favor of each of the Guarantors any other guarantees
or other security or any moneys or other assets which the Trustee may be
entitled to receive or upon which the Trustee or the Holders may have a claim.
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Section 1309. Release of Security Interests.
Without limiting the generality of the foregoing and except as
otherwise provided in this Indenture, each Guarantor hereby consents and agrees,
to the fullest extent permitted by applicable law, that the rights of the
Trustee hereunder, and the liability of the Guarantors hereunder, shall not be
affected by any and all releases for any purpose of any collateral, if any, from
the Liens and security interests created by any collateral document and that
this Guarantee shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Indenture Obligations is rescinded
or must otherwise be returned by the Trustee upon the insolvency, bankruptcy or
reorganization of the Company or otherwise, all as though such payment had not
been made.
Section 1310. No Bar to Further Actions.
Except as provided by law, no action or proceeding brought or
instituted under Article Thirteen and this Guarantee and no recovery or judgment
in pursuance thereof shall be a bar or defense to any further action or
proceeding which may be brought under Article Thirteen and this Guarantee by
reason of any further default or defaults under Article Thirteen and this
Guarantee or in the payment of any of the Indenture Obligations owing by the
Company.
Section 1311. Failure to Exercise Rights Shall Not Operate as a Waiver; No
Suspension of Remedies.
(a) No failure to exercise and no delay in exercising, on the part
of the Trustee or the Holders, any right, power, privilege or remedy under this
Article Thirteen and this Guarantee shall operate as a waiver thereof, nor shall
any single or partial exercise of any rights, power, privilege or remedy
preclude any other or further exercise thereof, or the exercise of any other
rights, powers, privileges or remedies. The rights and remedies herein provided
for are cumulative and not exclusive of any rights or remedies provided in law
or equity.
(b) Nothing contained in this Article Thirteen shall limit the right
of the Trustee or the Holders to take any action to accelerate the maturity of
the Securities pursuant to Article Five or to pursue any rights or remedies
hereunder or under applicable law.
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Section 1312. Trustee's Duties; Notice to Trustee.
(a) Any provision in this Article Thirteen or elsewhere in this
Indenture allowing the Trustee to request any information or to take any action
authorized by, or on behalf of any Guarantor, shall be permissive and shall not
be obligatory on the Trustee except as the Holders may direct in accordance with
the provisions of this Indenture or where the failure of the Trustee to request
any such information or to take any such action arises from the Trustee's
negligence, bad faith or willful misconduct.
(b) The Trustee shall not be required to inquire into the existence,
powers or capacities of the Company, any Guarantor or the officers, directors or
agents acting or purporting to act on their respective behalf.
Section 1313. Successors and Assigns.
All terms, agreements and conditions of this Article Thirteen shall
extend to and be binding upon each Guarantor and its successors and permitted
assigns and shall enure to the benefit of and may be enforced by the Trustee and
its successors and assigns; provided, however, that the Guarantors may not
assign any of their rights or obligations hereunder other than in accordance
with Article Eight.
Section 1314. Release of Guarantee.
Concurrently with the payment in full of all of the Indenture
Obligations, the Guarantors shall be released from and relieved of their
obligations under this Article Thirteen. Upon the delivery by the Company to the
Trustee of an Officers' Certificate and, if requested by the Trustee, an Opinion
of Counsel to the effect that the transaction giving rise to the release of this
Guarantee was made by the Company in accordance with the provisions of this
Indenture and the Securities, the Trustee shall execute any documents reasonably
required in order to evidence the release of the Guarantors from their
obligations under this Guarantee. If any of the Indenture Obligations are
revived and reinstated after the termination of this Guarantee, then all of the
obligations of the Guarantors under this Guarantee shall be revived and
reinstated as if this Guarantee had not been terminated until such time as the
Indenture Obligations are paid in full, and each Guarantor shall enter into an
amendment to this Guarantee, reasonably satisfactory to the Trustee, evidencing
such revival and reinstatement.
This Guarantee shall terminate with respect to each Guarantor and
shall be automatically and unconditionally released and discharged as provided
in Section 1013(b).
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Section 1315. Execution of Guarantee.
(a) To evidence the Guarantee, each Guarantor hereby agrees to
execute the guarantee substantially in the form set forth in Section 205, to be
endorsed on each Security authenticated and delivered by the Trustee and that
this Indenture shall be executed on behalf of each Guarantor by its Chairman of
the Board, its President, its Chief Executive Officer, Chief Operating Officer
or one of its Vice Presidents, under its corporate seal reproduced thereon
attested by its Secretary or one of its Assistant Secretaries. The signature of
any of these officers on the Securities may be manual or facsimile.
(b) Any person that was not a Guarantor on the Issue Date may become
a Guarantor by executing and delivering to the Trustee (i) a supplemental
indenture in form and substance satisfactory to the Trustee, which subjects such
person to the provisions (including the representations and warranties) of this
Indenture as a Guarantor, (ii) in the event that as of the date of such
supplemental indenture any Registrable Securities are outstanding, an instrument
in form and substance satisfactory to the Trustee which subjects such person to
the provisions of the Registration Rights Agreement with respect to such
outstanding Registrable Securities, and (iii) an Opinion of Counsel to the
effect that such supplemental indenture has been duly authorized and executed by
such person and constitutes the legal, valid and binding obligation of such
person (subject to such customary assumptions and exceptions as may be
acceptable to the Trustee in its reasonable discretion).
(c) If an officer whose signature is on this Indenture no longer
holds that office at the time the Trustee authenticates a Security on which this
Guarantee is endorsed, such Guarantee shall be valid nevertheless.
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
Section 1401. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by
his acceptance thereof, likewise covenants and agrees, that, to the extent and
in the manner hereinafter set forth in this Article, the Indebtedness
represented by the Securities and the payment of the principal of, premium, if
any, and interest on, the Securities are hereby expressly made subordinate and
subject in right of payment as provided in this Article to the prior payment in
full of all Senior Indebtedness.
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This Article Thirteen shall constitute a continuing offer to all
Persons who, in reliance upon such provisions, become holders of, or continue to
hold Senior Indebtedness; and such provisions are made for the benefit of the
holders of Senior Indebtedness; and such holders are made obligees hereunder and
they or each of them may enforce such provisions.
Section 1402. Payment Over of Proceeds Upon Dissolution, etc.
In the event of (a) any insolvency or bankruptcy case or proceeding,
or any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to the Company or its assets, or
(b) any liquidation, dissolution or other winding up of the Company, whether
voluntary or involuntary, or whether or not involving insolvency or bankruptcy,
or (c) any assignment for the benefit of creditors or any other marshaling of
assets or liabilities of the Company, then and in any such event:
(1) the holders of Senior Indebtedness shall be entitled to receive
payment in full of all amounts due on or in respect of Senior Indebtedness
before the Holders of the Securities are entitled to receive any payment or
distribution of any kind or character (excluding securities of the Company or
any other corporation that are equity securities or are subordinated in right of
payment to all Senior Indebtedness, that may be outstanding, to substantially
the same extent as, or to a greater extent than, the Securities are so
subordinated as provided in this Article ("Permitted Junior Securities")) on
account of the principal of, premium, if any, or interest on the Securities or
on account of the purchase, redemption, defeasance or other acquisition of, or
in respect of, the Securities (other than amounts previously set aside with the
Trustee, or payments previously made, in either case, pursuant to the provisions
of Sections 402 and 403 of this Indenture); and
(2) any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities (excluding Permitted
Junior Securities), by set-off or otherwise, to which the Holders or the Trustee
would be entitled but for the provisions of this Article shall be paid by the
liquidating trustee or agent or other Person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee
or otherwise, directly to the holders of Senior Indebtedness or their
representative or representatives or to the trustee or trustees under any
indenture under which any instruments evidencing any of such Senior Indebtedness
may have been issued, ratably according to the aggregate amounts remaining
unpaid on account of the Senior Indebtedness held or represented by each, to the
extent necessary to make payment in full, of all Senior Indebtedness remaining
unpaid, after giving effect to any concurrent payment or distribution to the
holders of such Senior Indebtedness; and
(3) in the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received any
payment or
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distribution of assets of the Company of any kind or character, whether in cash,
property or securities (excluding Permitted Junior Securities), in respect of
principal, premium, if any, and interest on the Securities before all Senior
Indebtedness is paid in full, then and in such event such payment or
distribution (excluding Permitted Junior Securities) shall be paid over or
delivered forthwith to the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee, agent or other Person making payments or distributions of
assets of the Company for application to the payment of all Senior Indebtedness
remaining unpaid, to the extent necessary to pay all Senior Indebtedness in full
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company
with or into, another Person or the liquidation or dissolution of the Company
following the sale, assignment, conveyance, transfer, lease or other disposal of
its properties and assets substantially as an entirety to another Person upon
the terms and conditions set forth in Article Eight shall not be deemed a
dissolution, winding up, liquidation, reorganization, assignment for the benefit
of creditors or marshaling of assets and liabilities of the Company for the
purposes of this Section if the Person formed by such consolidation or the
surviving entity of such merger or the Person which acquires by sale,
assignment, conveyance, transfer, lease or other disposal of such properties and
assets substantially as an entirety, as the case may be, shall, as a part of
such consolidation, merger, sale, assignment, conveyance, transfer, lease or
other disposal, comply with the conditions set forth in Article Eight.
Section 1403. Suspension of Payment When Designated Senior Indebtedness
in Default.
(a) Unless Section 1402 shall be applicable, upon the occurrence and
during the continuance of any default in the payment of any Designated Senior
Indebtedness beyond any applicable grace period (a "Payment Default") and after
the receipt by the Trustee from a Senior Representative of any Designated Senior
Indebtedness of written notice of such default, no payment (other than amounts
previously set aside with the Trustee or payments previously made, in either
case, pursuant to Section 402 or 403 in this Indenture) or distribution of any
assets of the Company or any Subsidiary of any kind or character (excluding
Permitted Junior Securities) may be made by the Company on account of the
principal of, premium, if any, or interest on, the Securities, or on account of
the purchase, redemption, defeasance or other acquisition of or in respect of,
the Securities unless and until such Payment Default shall have been cured or
waived or shall have ceased to exist or such Designated Senior Indebtedness
shall have been discharged or paid in full, after which the Company shall
(subject to the other provisions of this Article Thirteen) resume making any and
all required payments in respect of the Securities, including any missed
payments.
- 146 -
(b) Unless Section 1402 shall be applicable, (1) upon the occurrence
and during the continuance of any non-payment default with respect to any
Designated Senior Indebtedness pursuant to which the maturity thereof may then
be accelerated immediately (a "Non-payment Default") and (2) after the receipt
by the Trustee and the Company from a Senior Representative of any Designated
Senior Indebtedness of written notice of such Non-payment Default, no payment
(other than any amounts previously set aside with the Trustee, or payments
previously made, in either case, pursuant to the provisions of Sections 402 or
403 in this Indenture) or distribution of any assets of the Company of any kind
or character (excluding Permitted Junior Securities) may be made by the Company
or any Subsidiary on account of the principal of, premium, if any, or interest
on, the Securities, or on account of the purchase, redemption, defeasance or
other acquisition of, or in respect of, the Securities for the period specified
below ("Payment Blockage Period").
(c) The Payment Blockage Period shall commence upon the receipt of
notice of the Non-payment Default by the Trustee and the Company from a Senior
Representative and shall end on the earliest of (i) the 179th day after such
commencement, (ii) the date on which such Non-payment Default (and all
Nonpayment Defaults as to which notice is given after such Payment Blockage
Period is initiated) is cured, waived or ceases to exist or on which such
Designated Senior Indebtedness is discharged or paid in full, or (iii) the date
on which such Payment Blockage Period (and all Non-payment Defaults as to which
notice is given after such Payment Blockage Period is initiated) shall have been
terminated by written notice to the Company or the Trustee from the Senior
Representative initiating such Payment Blockage Period, after which, in the case
of clauses (i), (ii) and (iii), the Company shall promptly resume making any and
all required payments in respect of the Securities, including any missed
payments. In no event will a Payment Blockage Period extend beyond 179 days from
the date of the receipt by the Company and the Trustee of the notice initiating
such Payment Blockage Period (such 179-day period referred to as the "Initial
Period"). Any number of notices of Non-payment Defaults may be given during the
Initial Period; provided that during any period of 365 consecutive days only one
Payment Blockage Period, during which payment of principal of, premium, if any,
or interest on, the Securities may not be made, may commence and the duration of
such period may not exceed 179 days. No Nonpayment Default with respect to any
Designated Senior Indebtedness that existed or was continuing on the date of the
commencement of any Payment Blockage Period will be, or can be, made the basis
for the commencement of a second Payment Blockage Period, whether or not within
a period of 365 consecutive days, unless such default has been cured or waived
for a period of not less than 90 consecutive days. The Company shall deliver a
notice to the Trustee promptly after the date on which any Non-payment Default
is cured or waived or ceases to exist or on which the Designated Senior
Indebtedness related thereto is discharged or paid in full, and the Trustee is
authorized to act in reliance on such notice.
- 147 -
(d) In the event that, notwithstanding the foregoing, the Company
shall make any payment to the Trustee or the Holder of any Security prohibited
by the foregoing provisions of this Section, then and in such event such payment
shall be paid over and delivered forthwith to a Senior Representative of the
holders of the Designated Senior Indebtedness or as a court of competent
jurisdiction shall direct.
Section 1404. Payment Permitted if No Default.
Nothing contained in this Article, elsewhere in this Indenture or in
any of the Securities shall prevent the Company, at any time except during the
pendency of any case, proceeding, dissolution, liquidation or other winding-up,
assignment for the benefit of creditors or other marshaling of assets and
liabilities of the Company referred to in Section 1402 or under the conditions
described in Section 1403, from making payments at any time of principal of,
premium, if any, or interest on the Securities.
Section 1405. Subrogation to Rights of Holders of Senior Indebtedness.
After the payment in full, the Holders of the Securities shall be
subrogated to the rights of the holders of such Senior Indebtedness to receive
payments and distributions of cash, property and securities applicable to the
Senior Indebtedness until the principal of, premium, if any, and interest on,
the Securities shall be paid in full. For purposes of such subrogation, no
payments or distributions to the holders of Senior Indebtedness of any cash,
property or securities to which the Holders of the Securities or the Trustee
would be entitled except for the provisions of this Article, and
no payments over pursuant to the provisions of this Article to the holders of
Senior Indebtedness by Holders of the Securities or the Trustee, shall, as among
the Company, its creditors other than holders of Senior Indebtedness, and the
Holders of the Securities, be deemed to be a payment or distribution by the
Company to or on account of the Senior Indebtedness.
Section 1406. Provisions Solely to Define Relative Rights.
The provisions of this Article are intended solely for the purpose
of defining the relative rights of the Holders of the Securities on the one hand
and the holders of Senior Indebtedness on the other hand. Nothing contained in
this Article or elsewhere in this Indenture or in the Securities is intended to
or shall (a) impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders of the Securities, the obligation of the
Company, which is absolute and unconditional, to pay to the Holders of the
Securities the principal of, premium, if any, and interest on, the Securities as
and when the same shall become due and payable in accordance with their terms;
or (b) affect the relative rights against the Company or the Holders of the
Securities and creditors of the Company other than the holders of Senior
Indebtedness; or
- 148 -
(c) prevent the Trustee or the Holder of any Security from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article of the holders of
Senior Indebtedness (1) in any case, proceeding, dissolution, liquidation or
other winding up, assignment for the benefit of creditors or other marshaling of
assets and liabilities of the Company referred to in Section 1402, to receive,
pursuant to and in accordance with such Section, cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder, or (2) under the
conditions specified in Section 1303, to prevent any payment prohibited by such
Section or enforce their rights pursuant to Section 1303(d).
Section 1407. Trustee to Effectuate Subordination.
Each Holder of a Security by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes,
including, in the event of any dissolution, winding-up, liquidation or
reorganization of the Company whether in bankruptcy, insolvency, receivership
proceedings, or otherwise, the timely filing of a claim for the unpaid balance
of the indebtedness of the Company owing to such Holder in the form required in
such proceedings and the causing of such claim to be approved.
Section 1408. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior
Indebtedness to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any non-compliance by the Company with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof any such holder may have
or be otherwise charged with.
(b) Without limiting the generality of subsection (a) of this
Section, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (1) change the manner,
place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness or any instrument evidencing the same or any agreement under
which Senior Indebtedness is outstanding; (2) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (3) release any Person liable in any manner for the collection or
payment of
- 149 -
Senior Indebtedness; and (4) exercise or refrain from exercising any rights
against the Company and any other Person; provided, however, that in no event
shall any such actions limit the right of the Holders of the Securities to take
any action to accelerate the maturity of the Securities pursuant to Article Five
of this Indenture or to pursue any rights or remedies hereunder or under
applicable laws if the taking of such action does not otherwise violate the
terms of this Article.
Section 1409. Notice to Trustee.
(a) The Company shall give prompt written notice to the Trustee of
any fact known to the Company which would prohibit the making of any payment to
or by the Trustee in respect of the Securities. Notwithstanding the provisions
of this Article or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Indebtedness or from a Senior Representative or
any trustee, fiduciary or agent therefor; and, prior to the receipt of any such
written notice, the Trustee shall be entitled in all respects to assume that no
such facts exist; provided, however, that if the Trustee shall not have received
the notice provided for in this Section by Noon, Eastern Time, on the Business
Day prior to the date upon which by the terms hereof any money may become
payable for any purpose (including, without limitation, the payment of the
principal of, premium, if any, or interest on any Security), then, anything
herein contained to the contrary notwithstanding but without limiting the rights
and remedies of the holders of Senior Indebtedness, a Senior Representative or
any trustee, fiduciary or agent thereof, the Trustee shall have full power and
authority to receive such money and to apply the same to the purpose for which
such money was received and shall not be affected by any notice to the contrary
which may be received by it after such date; nor shall the Trustee be charged
with knowledge of the curing of any such default or the elimination of the act
or condition preventing any such payment unless and until the Trustee shall have
received an Officers' Certificate to such effect.
(b) The Trustee shall be entitled to rely on the delivery to it of a
written notice to the Trustee and the Company by a Person representing himself
to be a Senior Representative or a holder of Senior Indebtedness (or a trustee,
fiduciary or agent therefor) to establish that such notice has been given by a
Senior Representative or a holder of Senior Indebtedness (or a trustee,
fiduciary or agent therefor); provided, however, that failure to give such
notice to the Company shall not affect in any way the ability of the Trustee to
rely on such notice. In the event that the Trustee determines in good faith that
further evidence is required with respect to the right of any Person as a holder
of Senior Indebtedness to participate in any payment or distribution pursuant to
this Article, the Trustee may request such Person to furnish evidence to the
reasonable
- 150 -
satisfaction of the Trustee as to the amount of Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article, and if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment.
Section 1410. Reliance on Judicial Orders or Certificates.
Upon any payment or distribution of assets of the Company referred
to in this Article, the Trustee and the Holders of the Securities shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee for the benefit of creditors, agent or other person
making such payment or distribution, or a certificate of a Senior
Representative, delivered to the Trustee or to the Holders of Securities for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article,
provided that the foregoing shall apply only if such court has been fully
apprised of the provisions of this Article.
Section 1411. Rights of Trustee as a Holder of Senior Indebtedness;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness which
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder. Nothing in this Article shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 607.
Section 1412. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall
have been appointed by the Company and be then acting under this Indenture, the
term "Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee; provided,
however, that Section 1411 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.
- 151 -
Section 1413. No Suspension of Remedies.
Nothing contained in this Article shall limit the right of the
Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Article Five of this Indenture or to
pursue any rights or remedies hereunder or under applicable law, subject to the
rights, if any, under this Article of the holders, from time to time, of Senior
Indebtedness to receive the cash, property or securities receivable upon the
exercise of such rights or remedies.
Section 1414. Trustee's Relation to Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Article against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and the Trustee shall
not be liable to any holder of Senior Indebtedness if it shall in good faith
mistakenly (absent negligence or willful misconduct) pay over or deliver to
Holders, the Company or any other Person moneys or assets to which any holder of
Senior Indebtedness shall be entitled by virtue of this Article or otherwise.
* * *
- 152 -
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
SONIC AUTOMOTIVE, INC.
By: /s/ B. Scott Smith
----------------------------------
Name: B. Scott Smith
Title: Authorized Office3r
Attest: /s/ Theodore M. Wright
---------------------------
Name: Theodore M. Wright
Title: Authorized Officer
TOWN AND COUNTRY FORD
INCORPORATED
MARCUS DAVID CORPORATION
FRONTIER OLDSMOBILE--CADILLAC, INC.
SONIC DODGE, LLC
SONIC
CHRYSLER--PLYMOUTH--JEEP--EAGLE,
LLC
FORT MILL FORD, INC.
TOWN AND COUNTRY
CHRYSLER--PLYMOUTH--JEEP OF ROCK
HILL, INC.
FORT MILL
CHRYSLER--PLYMOUTH--DODGE
INC.
LONE STAR FORD, INC.
SONIC AUTOMOTIVE OF NEVADA, INC.
SONIC AUTOMOTIVE OF TENNESSEE, INC.
SONIC AUTOMOTIVE - 6025
INTERNATIONAL
DRIVE, LLC
SONIC AUTOMOTIVE OF NASHVILLE, LLC
SONIC AUTOMOTIVE OF CHATTANOOGA,
LLC
TOWN AND COUNTRY JAGUAR, LLC
TOWN AND COUNTRY CHRYSLER
--PLYMOUTH--JEEP, LLC
TOWN AND COUNTRY DODGE OF
CHATTANOOGA, LLC
SONIC AUTOMOTIVE - 2490 SOUTH LEE
HIGHWAY, LLC,
TOWN AND COUNTRY FORD OF
CLEVELAND,
LLC
FREEDOM FORD, INC.
SONIC AUTOMOTIVE 5260 PEACHTREE
INDUSTRIAL BLVD., LLC
SONIC AUTOMOTIVE OF GEORGIA, INC.
SONIC PEACHTREE INDUSTRIAL BLVD., L.P.
SONIC AUTOMOTIVE - CLEARWATER, INC.
SONIC AUTOMOTIVE 21699 U.S. HWY. 19 N.,
INC.
SONIC AUTOMOTIVE COLLISION CENTER OF
CLEARWATER, INC.
SONIC AUTOMOTIVE - 1400 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1455 AUTOMALL
DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1495 AUTOMALL
DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1500 AUTOMALL
DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 3700 WEST BROAD
STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE - 4000 WEST BROAD
STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE 2424 LAURENS RD.,
GREENVILLE, INC.
SONIC AUTOMOTIVE 2752 LAURENS RD.,
GREENVILLE, INC.
SONIC AUTOMOTIVE - 5585 PEACHTREE
INDUSTRIAL BLVD., LLC
CAPITOL CHEVROLET AND IMPORTS, INC.,
SONIC AUTOMOTIVE - 1919 N. DIXIE HWY.,
NSB,
INC.
SONIC AUTOMOTIVE - 1307 N. DIXIE HWY.,
NSB,
INC.
SONIC AUTOMOTIVE - 1720 MASON AVE.,
DB,
INC.
SONIC AUTOMOTIVE - 3741 S. NOVA RD., PO,
INC.
SONIC AUTOMOTIVE - 241 RIDGEWOOD
AVE.,
HH, INC.
SONIC AUTOMOTIVE - HWY. 153 at
SHALLOWFORD
ROAD, CHATTANOOGA, INC.
By: /s/ B. Scott Smith
------------------------------
Name: B. Scott Smith
Title: Authorized Officer
Attest: /s/ Theodore M. Wright
--------------------------
Name: Theodore M. Wright
Title: Authorized Officer
U.S. BANK TRUST NATIONAL
ASSOCIATION
By: /s/ Judith M. Zuzek
----------------------------
Name:
Title:
STATE OF NORTH CAROLINA )
) ss.:
COUNTY OF UNION )
On the 29th day of July, 1998, before me personally came Theodore M.
Wright, to me known, who, being by me duly sworn, did depose and say that he
resides at Charlotte, NC; that he is Authorized Officer of Sonic Automotive,
Inc., a corporation described in and which executed the foregoing instrument;
and that he signed his name thereto pursuant to authority of the Board of
Directors of such corporation.
(NOTARIAL
SEAL)
/s/Donna M. Bowen My Comm. exp. 8-12-98
--------------------------------------------
SONIC AUTOMOTIVE, INC
STATE OF NORTH CAROLINA )
) ss.:
COUNTY OF UNION )
On the 29th day of July, 1998, before me personally came Theodore M.
Wright, to me known, who, being by me duly sworn, did depose and say that he
resides at Charlotte, NC; that he is Authorized Officer of the corporations
listed below, corporations described in and which executed the foregoing
instrument; and that he signed his name thereto pursuant to authority of the
Board of Directors of such corporations.
(NOTARIAL
SEAL)
/s/ Donna M. Bowen My Comm. exp. 8-12-98
--------------------------------------------
TOWN AND COUNTRY FORD
INCORPORATED
MARCUS DAVID CORPORATION
FRONTIER OLDSMOBILE--CADILLAC,
INC.
FORT MILL FORD, INC.
TOWN AND COUNTRY
CHRYSLER--PLYMOUTH--JEEP OF
ROCK HILL, INC.
FORT MILL
CHRYSLER--PLYMOUTH--DODGE
INC.
LONE STAR FORD, INC.
SONIC AUTOMOTIVE OF NEVADA, INC.
SONIC AUTOMOTIVE OF TENNESSEE,
INC.
FREEDOM FORD, INC.
SONIC AUTOMOTIVE OF GEORGIA, INC.
SONIC AUTOMOTIVE - CLEARWATER,
INC.
SONIC AUTOMOTIVE 21699 U.S. HWY. 19 N., INC.
SONIC AUTOMOTIVE COLLISION CENTER OF
CLEARWATER, INC.
SONIC AUTOMOTIVE - 1400 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1455 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1495 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 1500 AUTOMALL DRIVE,
COLUMBUS, INC.
SONIC AUTOMOTIVE - 3700 WEST BROAD
STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE - 4000 WEST BROAD
STREET, COLUMBUS, INC.
SONIC AUTOMOTIVE 2424 LAURENS RD.,
GREENVILLE, INC.
SONIC AUTOMOTIVE 2752 LAURENS RD.,
GREENVILLE, INC.
CAPITOL CHEVROLET AND IMPORTS, INC.,
SONIC AUTOMOTIVE - 1919 N. DIXIE HWY., NSB,
INC.
SONIC AUTOMOTIVE - 1307 N. DIXIE HWY., NSB,
INC.
SONIC AUTOMOTIVE - 1720 MASON AVE., DB,
INC.
SONIC AUTOMOTIVE - 3741 S. NOVA RD.,
PO, INC.
SONIC AUTOMOTIVE - 241 RIDGEWOOD AVE.,
HH, INC.
SONIC AUTOMOTIVE - HWY. 153 at
SHALLOWFORD ROAD, CHATTANOOGA, INC.
STATE OF NORTH CAROLINA )
) ss.:
COUNTY OF UNION )
On the 29th day of July, 1998, before me personally came Theodore M.
Wright, to me known, who, being by me duly sworn, did depose and say that he
resides at Charlotte, NC; that he is Authorized Officer of the limited liability
corporations listed below, limited liability corporations described in and which
executed the foregoing instrument; and that he signed his name thereto pursuant
to authority of the Board of Directors of such limited liability corporations.
(NOTARIAL
SEAL)
/s/ Donna M. Bowen My Comm. exp. 8-12-98
-----------------------------------------
SONIC DODGE, LLC
SONIC
CHRYSLER--PLYMOUTH--JEEP--EAGLE,
LLC
SONIC AUTOMOTIVE - 6025 INTERNATIONAL
DRIVE, LLC
SONIC AUTOMOTIVE OF NASHVILLE, LLC
SONIC AUTOMOTIVE OF CHATTANOOGA, LLC
TOWN AND COUNTRY JAGUAR, LLC
TOWN AND COUNTRY CHRYSLER
--PLYMOUTH--JEEP, LLC
TOWN AND COUNTRY DODGE OF
CHATTANOOGA, LLC
SONIC AUTOMOTIVE - 2490 SOUTH LEE
HIGHWAY, LLC,
TOWN AND COUNTRY FORD OF CLEVELAND,
LLC
SONIC AUTOMOTIVE 5260 PEACHTREE
INDUSTRIAL BLVD., LLC
STATE OF NORTH CAROLINA )
) ss.:
COUNTY OF UNION )
On the 29th day of July, 1998, before me personally came Theodore M.
Wright, to me known, who, being by me duly sworn, did depose and say that he
resides at Charlotte, NC; that he is Authorized Officer of Sonic Peachtree
Industrial Blvd., L.P., a limited partnership described in and which executed
the foregoing instrument; and that he signed his name thereto pursuant to
authority of the partners of such limited partnership.
(NOTARIAL
SEAL)
/s/ Donna M. Bowen My Comm. exp. 8-12-98
-----------------------------------------
SONIC PEACHTREE INDUSTRIAL BLVD., L.P.