Exhibit 4.2
Form 10-Q
Headway Corporate Resources, Inc.
File No. 1-16025
FOURTH SUPPLEMENTAL INDENTURE
Fourth Supplemental Indenture, dated as of August 24,
2001, to the Indenture dated as of March 19, 1998, between
Headway Corporate Resources, Inc., a Delaware corporation (the
"Company), and State Street Bank and Trust Company, N.A., a
national banking association, as trustee (the "Trustee"), as
amended by a First Supplemental Indenture, dated as of October
28, 1998, a Second Supplemental Indenture, dated as of May 10,
1999 and a third Supplemental Indenture dated as of January 8,
2001 (as amended to date, the "Indenture").
RECITAL
The Indenture provides that the Company and the Trustee
may, with the consent of all of Holders of the Company's
Increasing Rate Senior Subordinated Notes due 2006 (the
"Securities"), enter into a Supplemental Indenture for the
purpose of amending any provision of the Indenture with respect
to the Securities. The Company has received signed consents of
the Holders of all of the Securities approving the substance of
this Fourth Supplemental Indenture.
NOW, THEREFORE, the parties agree as follows for their
mutual benefit and for the equal and ratable benefit of the
Holders of the Securities:
1. Capitalized terms not defined herein shall have the meanings
given to them in the Indenture.
2. (a) Subject to the terms and conditions set forth in the
Limited Waiver and Amendment and in reliance on the
representations, warranties and covenants of the Company
contained therein, from and after the Amendment Effective Date
(as defined in the Limited Waiver and Amendment), the Holders,
pursuant to the Limited Waiver and Amendment, have waived:
(i) compliance with Section 4.20 of the Indenture (Net Worth)
for the period from April 1, 2001 through and including the Bank
Maturity Date (as defined in the Limited Waiver and Amendment);
(ii) compliance with Section 4.23 of the Indenture (Certain
Consolidated Ratios) for the period from April 1, 2001 through
and including the Bank Maturity Date; and
(iii) the payment in cash of any amounts with respect to
principal, interest (but not the accrual of interest), fees or
other amounts payable under the Indenture and the Securities
through and including the Bank Maturity Date, subject, however,
to the provisions of Section 3(e) of the Limited Waiver and
Amendment.
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Notwithstanding the foregoing, upon the occurrence of any other
Event of Default (including, without limitation, the failure of
the Company to comply with the provisions of Section 6 of the
Limited Waiver and Amendment) or at any time the Trustee or the
Noteholders may hereafter become aware of any other Event of
Default (whether heretofore or hereafter arising), the limited
waiver set forth in Section 2(a) above shall be deemed null and
void as of the date of the Limited Waiver and Amendment (other
than the provisions of 2(a)(iii) above) and of no further force
and effect (as if such limited waiver had never been given
effect), without any necessity of demand or notice to the Company
or other Person, and the Trustee and the Noteholders may
thereafter in their sole and absolute discretion and
notwithstanding any grace or cure periods or other provisions to
the contrary in the Indenture, take any enforcement action and
exercise any and all of their other rights, remedies and
privileges under the Indenture, any other instrument or agreement
referred to therein, under applicable law or otherwise, with
respect to any Subordinated Note Designated Defaults (as defined
in the Limited Waiver and Amendment) or any other Event of
Default.
(b) Without limiting the generality of the provisions of Article
IX of the Indenture, the limited waiver set forth in Section 2(a)
above shall be limited precisely as written and shall relate
solely to non-compliance by the Company with the provisions of
the Indenture and/or the Securities (as applicable) specifically
set forth in Section 2(a) hereof for the periods specifically
referenced therein and nothing in this Agreement shall be deemed
to:
(i) Constitute a waiver by the Trustee or the Holders with
respect to the payment of interest on the Securities, and
compliance with Section 4.20 and 4.23 of the Indenture, in any
other instance or any other term, provision or condition of the
Indenture or the Securities; or
(ii) prejudice any right or remedy that the Trustee or any Holder
may now have or may have in the future under or in connection
with the Indenture, the Securities any other instrument or
agreement referred to therein or under applicable law.
(c) The Holders reaffirm all of the terms of the Indenture,
including, without limitation, Sections 10.03 and 10.08, the
Lenders' (as defined in the Limited Waiver and Amendment) rights
under Section 10.02(a) of the Indenture to block any payments of
any kind or character with respect to any principal, interest,
fee or other amounts payable with respect to the Securities which
may be exercised at any time or from time to time hereafter upon
the Company's default in payment, whether at maturity, upon any
redemption, by declaration or otherwise, of any principal of the
Loans (as defined in the Limited Waiver and Amendment), interest
thereon, fees or other Obligations (as defined in the Limited
Waiver and Amendment) payable under the Loan Documents (as
defined in the Limited Waiver and Amendment) and the Lenders'
other rights, remedies and privileges under Section 10 of the
Indenture, notwithstanding any action heretofore taken by the
Lenders (including, without limitation, the issuance of a
blockage notice under the terms of the Indenture), subject
however to the provisions of Section 9 of the Seventh Amendment
and Limited Waiver (as defined in the Limited Waiver and
Amendment).
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3. Section 1.01 of the Indenture is hereby amended by adding
thereto the following definitions, which shall be inserted in
proper alphabetical order:
"Amendment Effective Date" has the meaning set forth
in Section 3 of the Limited Waiver and Amendment.
"Bank Maturity Date" means the earliest of (a) April
18, 2002, (b) the date on which all indebtedness
under the Credit Agreement shall have been repaid or
refinanced and all issued and outstanding letters of
credit under the Credit Agreement shall have been
canceled, fully collateralized or otherwise
supported in a manner satisfactory to the lenders
under the Credit Agreement and (c) the acceleration
of any indebtedness under the Credit Agreement or
the exercise of any rights or remedies by any of the
Lenders or the Agent under the Credit Agreement.
"Budget" means the cash budget delivered by the
Borrower to the Holders pursuant to Section 3(b) of
the Limited Waiver and Amendment, as the same may be
amended, supplemented or otherwise modified from
time to time in accordance with the Limited Waiver
and Amendment.
"Limited Waiver and Amendment" means that certain
Limited Waiver and Amendment dated as of August 24,
2001 by and among the Company, the Trustee and the
Holders, as the same may be amended, supplemented or
otherwise modified from time to time.
4. Section 4.08 of the Indenture shall be amended by adding a
Section 4.08(c) as follows:
"(c) the Company shall, at all times following the
Amendment Effective Date, provide to each Holder and the Trustee
promptly, and in any event within one Business Day, copies of any
reports and other information provided to the Lenders and the
Agent pursuant to the Credit Agreement"
Section 4.08 of the Indenture shall be further amended
by adding a Section 4.08(d) as follows:
"(d) The Company shall, and shall cause its
Subsidiaries to, cooperate with and give full and complete access
and make available to the Trustee and the Holders and
representatives retained by any of them from time to time, on a
daily basis, the books and records of the Company and its
Subsidiaries and other information relating to the business or
financial affairs of the Company and its Subsidiaries (including,
without limitation, agreements and documents pertaining to any
receivables or payables), and the operating management of the
Company and its Subsidiaries shall meet, upon request, with the
Trustee and the Holders to discuss, among other things, the
financial and operating performance and business plans of the
Company and its Subsidiaries. The Company shall, and shall cause
its Subsidiaries to, give full and complete access to such other
information as the Trustee or the Holders may reasonably request
from time to time, and shall cooperate and consult with, and
provide to the Trustee and the Holders all such information."
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5. Paragraph 1 of the Securities, Interest, is hereby amended
by adding a new sentence at the end thereof as follows:
"If all interest on the Securities and dividends on the Preferred
Stock accrued on and prior to April 1, 2002 are not paid in full
in cash by such date, then the interest rate on the Securities
shall be increased to 20% per annum commencing on July 1, 200l;
provided, however, that following such increase there shall be no
increase in the interest rate upon the occurrence and during the
continuance of any Event of Default."
6. Representations and Warranties. In order to induce the
Trustee to enter into this Fourth Supplemental Indenture, the
Company represents and warrants to the Trustee and Holders as
follows:
(A) The representations and warranties made by the Company in
Section 5 of the Securities Purchase Agreement are true and
correct on and as of the date hereof;
(B) There has been no material adverse change in the condition,
financial or otherwise, or the Company and its Subsidiaries,
taken as whole, since the most recent financial reports of the
Company received by the Trustee under Section 4.08 of the
Indenture;
(C) The business and properties of the Company and its
Subsidiaries, taken as a whole, are not, and since the most
recent financial report of the Company and its Subsidiaries
received by the Trustee under Section 4.08 of the Indenture, has
not been, materially adversely affected in any substantial way as
the result of any fire, explosion, earthquake, accident, strike,
lockout, combination of workers, flood, embargo, riot, activities
of armed forces, war or acts of God or the public enemy, or
cancellation or loss of any major contracts; and
(D) No event has occurred and is continuing which constitutes,
and no condition exists which upon the consummation of the
transaction contemplated hereby would constitute, a Default or an
Event of Default under the Indenture as amended hereby which has
not been waived and consented to hereby or in the Limited Waiver
and Amendment.
7. The Fourth Supplemental Indenture is an indenture to and in
implementation of the Indenture, and the Indenture and this
fourth Supplemental Indenture shall henceforth be read together.
8. The Trustee accepts the trusts created by the Indenture, as
supplemented by this Fourth Supplemental Indenture, and agrees to
perform the same upon the terms and conditions in the Indenture,
as supplemented by this Fourth Supplemental Indenture.
9. The Indenture as amended and supplemented by this Fourth
Supplemental Indenture is in all respects confirmed and preserved
and shall remain in the full force and effect according to its
terms.
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10. This Fourth Supplemental Indenture may be executed in any
number of counterparts, each of which so execute shall be deemed
to be an original, but all such counterparts shall together
constitute but one and the same instrument.
11. The provisions of this Fourth Supplemental Indenture will
take effect immediately upon its execution and delivery by the
Trustee.
12. This Fourth Supplemental Indenture shall be governed by the
internal laws of the State of New York, without regard to its
principles of conflicts of laws.
13. If any provision of this Fourth Supplemental Indenture shall
be declared by a court of competent jurisdiction to be
unenforceable, invalid or void, the same shall not impair any of
the other provisions of this Fourth Supplemental Indenture, nor
shall any party have liability to the other parties as a result
of such unenforceable, invalid or void provision.
(Signature page to the Fourth Supplemental Indenture follows)
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IN WITNESS WHEREOF, the parties hereto have caused this
Fourth Supplemental Indenture to be duly executed as of the day
and year first above written.
HEADWAY CORPORATE RESOURCES, INC.
By: /s/ Barry S. Roseman
Title: President
Attest: /s/ Name: Naima N. Chisolm
Title: Vice President, Finance
STATE STREET BANK AND TRUST
COMPANY, N.A., as Trustee,
By: /s/ Ward A. Spooner
Title: Vice President
Attest: /s/ Jean Clarke
Title: Assistant Vice President
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