Exhibit 4.8
Form 10-K 2001, Amendment No. 1
Headway Corporate Resources, Inc.
File No. 1-16025
HEADWAY CORPORATE RESOURCES, INC., as Issuer
and
STATE STREET BANK AND TRUST COMPANY, N.A., as Trustee
--------------------------
AMENDED AND RESTATED
INDENTURE
Dated as of April 18, 2002
Effective as of March 31, 2002
-------------------------
$10,000,000
Increasing Rate Senior Subordinated Notes
Due 2006
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TABLE OF CONTENTS
Page
ARTICLE I. DEFINITIONS AND INCORPORATION BY REFERENCE.......................1
SECTION 1.01. Definitions.............................................1
SECTION 1.02. Incorporation by Reference of TIA......................18
SECTION 1.03. Rules of Construction..................................19
ARTICLE II. THE SECURITIES.................................................20
SECTION 2.01. Form and Dating........................................20
SECTION 2.02. Execution and Authentication...........................20
SECTION 2.03. Registrar and Paying Agent.............................21
SECTION 2.04. Paying Agent To Hold Assets in Trust...................21
SECTION 2.05. Securityholder Lists...................................22
SECTION 2.06. Transfer and Exchange..................................22
SECTION 2.07. Replacement Securities.................................23
SECTION 2.08. Outstanding Securities.................................23
SECTION 2.09. Treasury Securities....................................24
SECTION 2.10. Temporary Securities...................................24
SECTION 2.11. Cancellation...........................................24
SECTION 2.12. Defaulted Interest.....................................25
SECTION 2.13. Deposit of Monies......................................25
SECTION 2.14. CUSIP Number...........................................25
SECTION 2.15. Restrictive Legends....................................25
SECTION 2.16. Book Entry Provisions for Global Security..............25
SECTION 2.17. Special Transfer Provisions............................26
ARTICLE III. REDEMPTION....................................................29
SECTION 3.01. Notices to Trustee.....................................29
SECTION 3.02. Selection of Securities To Be Redeemed.................29
SECTION 3.03. Notice of Redemption...................................29
SECTION 3.04. Effect of Notice of Redemption.........................30
SECTION 3.05. Deposit of Redemption Price............................31
SECTION 3.06. Securities Redeemed in Part............................31
ARTICLE IV. COVENANTS......................................................31
SECTION 4.01. Payment of Securities..................................31
SECTION 4.02. Maintenance of Office or Agency........................31
SECTION 4.03. Corporate Existence....................................32
SECTION 4.04. Payment of Taxes and Other Claims......................32
SECTION 4.05. Maintenance of Properties and Insurance................32
SECTION 4.06. Compliance Certificates; Notice of Default.............33
SECTION 4.07. Compliance with Laws...................................34
SECTION 4.08. Financial Reports, Etc.................................34
SECTION 4.09. SEC Reports and Other Information......................35
SECTION 4.10. Waiver of Stay Extension or Usury Laws.................37
SECTION 4.11. Limitation on Indebtedness.............................37
SECTION 4.12. Limitation on Restricted Payments......................39
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SECTION 4.13. Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries.............................40
SECTION 4.14. Limitation on Liens....................................40
SECTION 4.15. Limitation on Investments, Loans and
Advances........................................................41
SECTION 4.16. Limitation on Transactions with Affiliates.............41
SECTION 4.17. Change of Control......................................41
SECTION 4.18. Disposition of Proceeds of Asset Sales.................43
SECTION 4.19. Limitation on Issuances and Sales of
Preferred Stock by Subsidiaries.................................46
SECTION 4.20. Limitation on Liquidations, Dissolutions,
Mergers and Consolidation.......................................46
SECTION 4.21. Net Worth..............................................46
SECTION 4.22. ERISA Compliance.......................................47
SECTION 4.23. Limitation on Acquisitions.............................47
SECTION 4.24. Certain Consolidated Ratios............................47
SECTION 4.25. Limitation on Hedging Obligations......................49
SECTION 4.26. Sale of Subsidiaries...................................49
SECTION 4.27. Conduct of Business....................................49
SECTION 4.28. Additional Guarantors..................................49
ARTICLE V. SUCCESSOR CORPORATION............................................49
SECTION 5.01. Consolidation, Merger, Conveyance, Transfer
or Lease........................................................49
SECTION 5.02. Successor Entity Substituted...........................51
ARTICLE VI. DEFAULT AND REMEDIES............................................51
SECTION 6.01. Events of Default......................................51
SECTION 6.02. Acceleration...........................................53
SECTION 6.03. Other Remedies.........................................54
SECTION 6.04. Waiver of Past Defaults................................54
SECTION 6.05. Control by Required Holders............................54
SECTION 6.06. Limitation on Suits....................................54
SECTION 6.07. Rights of Holders To Receive Payment...................55
SECTION 6.08. Collection Suit by Trustee.............................55
SECTION 6.09. Trustee May File Proofs of Claim.......................55
SECTION 6.10. Priorities.............................................56
SECTION 6.11. Undertaking for Costs..................................56
SECTION 6.12. Rights and Remedies Cumulative.........................56
SECTION 6.13. Delay or Omission Not Waiver...........................57
ARTICLE VII. TRUSTEE.......................................................57
SECTION 7.01. Duties of Trustee......................................57
SECTION 7.02. Rights of Trustee......................................58
SECTION 7.03. Individual Rights of Trustee...........................59
SECTION 7.04. Trustee's Disclaimer...................................59
SECTION 7.05. Notice of Default......................................59
SECTION 7.06. Reports by Trustee to Holders..........................59
SECTION 7.07. Compensation and Indemnity.............................60
SECTION 7.08. Replacement of Trustee.................................60
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SECTION 7.09. Successor Trustee by Merger, Etc.......................61
SECTION 7.10. Eligibility: Disqualification..........................62
SECTION 7.11. Preferential Collection of Claims Against
Company.........................................................62
ARTICLE VIII. DISCHARGE OF INDENTURE; DEFEASANCE...........................62
SECTION 8.01. Discharge of Indenture.................................62
SECTION 8.02. Legal Defeasance and Covenant Defeasance...............63
SECTION 8.03. Application of Trust Money.............................66
SECTION 8.04. Repayment to Company...................................66
SECTION 8.05. Reinstatement..........................................66
SECTION 8.06. Acknowledgment of Discharge by Trustee.................67
ARTICLE IX. AMENDMENTS, SUPPLEMENTS AND WAIVERS............................67
SECTION 9.01. Without Consent of Holders.............................67
SECTION 9.02. With Consent of Holders................................68
SECTION 9.03. Compliance with TIA....................................69
SECTION 9.04. Revocation and Effect of Consents......................69
SECTION 9.05. Notation on or Exchange of Securities..................70
SECTION 9.06. Trustee To Sign Amendments, Etc........................70
ARTICLE X. SUBORDINATION...................................................70
SECTION 10.01. Securities Subordinated to Senior
Indebtedness....................................................70
SECTION 10.02. Suspension of Payment on Securities in
Certain Events..................................................70
SECTION 10.03. Securities Subordinated to Prior Payment of
All Senior Indebtedness on Dissolution, Liquidation
or Reorganization of Company....................................72
SECTION 10.04. Holders to be Subrogated to Rights of
Holders of Senior Indebtedness..................................73
SECTION 10.05. Obligations of the Company Unconditional..............73
SECTION 10.06. Trustee Entitled to Assume Payments Not
Prohibited in Absence of Notice.................................74
SECTION 10.07. Application by Trustee of Assets Deposited
with It.........................................................74
SECTION 10.08. No Waiver of Subordination Provisions.................75
SECTION 10.09. Holders Authorize Trustee to Effectuate
Subordination of Notes..........................................75
SECTION 10.10. Right of Trustee to Hold Senior
Indebtedness....................................................76
SECTION 10.11. This Article X Not To Prevent Events of
Default.........................................................76
SECTION 10.12. No Fiduciary Duty of Trustee to Holders of
Senior Indebtedness.............................................76
ARTICLE XI. MISCELLANEOUS..................................................76
SECTION 11.01. TIA Controls..........................................76
SECTION 11.02. Notices...............................................77
SECTION 11.03. Communications by Holders with Other
Holders.........................................................78
SECTION 11.04. Certificate and Opinion as to Conditions
Precedent.......................................................78
SECTION 11.05. Statements Required in Certificate or
Opinion.........................................................78
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar.............79
SECTION 11.07. Legal Holidays........................................79
SECTION 11.08. Governing Law.........................................79
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SECTION 11.09. No Adverse Interpretation of Other
Agreements......................................................79
SECTION 11.10. No Recourse Against Others............................80
SECTION 11.11. Successors............................................80
SECTION 11.12. Counterparts..........................................80
SECTION 11.13. Severability..........................................80
SECTION 11.14. Table of Contents, Headings. Etc......................80
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Reconciliation and tie between the Trust Indenture Act of 1939 and
this Amended and Restated Indenture, dated as of April 18, 2002:
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Trust Indenture Act Section Initially Reflected in Indenture Section
- --------------------------------------------------------------------------------
Section 309 (b)(9) 7.10
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Section 310 (a)(1) 7.10
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(a)(2) 7.10
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(a)(5) 7.10
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(b) 7.10
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Section 311 (a) 7.11
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(b) 7.11
- --------------------------------------------------------------------------------
Section 312 (a) 2.05
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(b) 11.03
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(c) 11.03
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Section 313 (a) 7.06
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(b) 7.06
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(c) 7.06
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(d) 4.08
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Section 314 (a) 11.02
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(c)(3) 5.01
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Section 315 (b) 11.02
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Section 316 (b) 9.04
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AMENDED AND RESTATED INDENTURE, dated as of April __, 2002 and effective as
of March 31, 2002, 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").
Each party hereto agrees as follows for the benefit of each other party and
for the equal and ratable benefit of the Holders of the Company's Increasing
Rate Senior Subordinated Notes Due 2006:
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means with respect to any person, Indebtedness of
another person existing at the time such other Person becomes a Subsidiary of
such person or is merged with or into such person or a Subsidiary of such
Person, and not incurred in connection with, or in anticipation of, such other
person becoming a Subsidiary of such Person or the merger with or into such
other Person.
"Acquisition" means the acquisition of (i) a controlling equity or other
ownership interest in another Person (including the purchase of an option,
warrant or convertible, exchangeable or similar type security to acquire such a
controlling interest at the time it becomes exercisable, convertible or
exchangeable by the holder thereof), whether by purchase of such equity or other
ownership interest or upon exercise of an option or warrant for, or conversion
or exchange of securities into, such equity or other ownership interest, or (ii)
assets of another Person which constitute all or any material part of the assets
of such Person or of a line or lines of business conducted by such Person.
"Affiliate" means, with respect to any specified Person, any other Person
who directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person. The term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative of the foregoing.
"Affiliate Transaction" means the conduct of business or any transactions
or series of transactions by the Company or any of its Subsidiaries with or for
the benefit of any of their respective Affiliates.
"Agent" means any Registrar, Paying Agent or co-Registrar.
"Agent Members" has the meaning provided in Section 2.16.
"Asset Acquisition" means (i) any capital contribution (by means of
transfer of cash or other property to others or payment for property or services
for the account or use of others, or otherwise) to, or purchase or acquisition
1
of Capital Stock in, any other Person by the Company or any of its Subsidiaries,
in either case pursuant to which such Person shall become a Subsidiary of the
Company or any of its Subsidiaries or shall be merged with or into the Company
or any of its Subsidiaries or (ii) any acquisition by the Company or any of its
Subsidiaries of the assets of any person which constitute substantially all of
an operating unit or business of such Person.
"Asset Sale" means with respect to any Person, any direct or indirect sale,
issuance, conveyance, transfer, lease, assignment or other disposition
(including, without limitation, by merger or consolidation or by exchange of
assets and whether by operation of law or otherwise) in a single transaction or
series of transactions, made by such Person or a Subsidiary of such Person to
any other Person of (i) any Capital Stock of such Person or any Subsidiary of
such Person (whether structured as a sale, issuance or other disposition by such
Person or a Subsidiary of such Person) or (ii) any other Property or asset of
such Person or any Subsidiary of such Person (other than cash or Cash
Equivalents), in each case, other than inventory in the ordinary course of
business and other than isolated transactions (not involving Capital Stock)
which do not exceed $500,000 individually and $1,000,000 during any consecutive
12 month period. With respect to the Company and its Subsidiaries, the term
"Asset Sale" shall not include (a) any disposition of properties and assets of
the Company or any of its Subsidiaries that is governed under and complies with
the requirements set forth in Article V hereof, (b) any sale by the Company to a
Wholly-Owned Subsidiary of the Company or a sale by a Subsidiary of the Company
to the Company or to a Wholly-Owned Subsidiary of the Company, (c) any sale by
the Company of its Capital Stock pursuant to a Permitted Acquisition, or (d) the
sale, lease, conveyance, disposition or other transfer of all or substantially
all of the assets of the Company as permitted under Section 5.01 or any
disposition that constitutes a Change of Control.
"Asset Sale Offer" has the meaning provided in Section 4.17.
"Asset Sale Payment Date" means, with respect to any Excess Proceeds from
an Asset Sale, the earlier of (x) (i) the 360th day following receipt of Net
Proceeds (other than Net Equity Proceeds) and (ii) the 90th day following the
receipt of Net Equity Proceeds, or (y) such earlier date on which an Asset Sale
Offer shall expire.
"Attributable Indebtedness" means, in respect of a Sale/Leaseback
Transaction, as at the time of determination, the present value (discounted at
the interest rate borne, or to be borne, as the case may be, by the Securities,
compounded annually) of the total obligations of the lessee for rental payments
during the remaining term of the lease included in such Sale/Leaseback
Transaction (including any period for which such lease has been extended).
"Authorized Representative" means any of the Chief Executive Officer,
President and Chief Operating Officer or any Senior Vice President of the
Company, or with respect to financial matters only, the Senior Vice President
and Director of Corporate Development, Chief Financial Officer, Chief Operating
Officer or Treasurer of the Company, or any other person expressly designated by
the Board of Directors of the Company (or the appropriate committee thereof) as
an Authorized Representative of the Company.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
2
"Board of Directors" means, with respect to any Person, the board of
directors or other applicable governing body of such Person or any committee of
the board of directors or of such other governing body of such Person duly
authorized, with respect to any particular matter, to exercise the power of the
board of directors or other applicable governing body of such Person.
"Board Resolution" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person,
to have been duly adopted by the Board of Directors of such Person and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.
"Book-Entry Security" means a Security represented by a Global Security and
registered in the name of the nominee of the Depository.
"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.
"Business Day" means any day that is not a Legal Holiday.
"Capital Expenditures" means, with respect to the Company and its
Subsidiaries on a consolidated basis, for any period the sum of (without
duplication) (i) all expenditures (whether paid in cash or accrued as
liabilities) by the Company or any of its Subsidiaries during such period for
items that would be classified as "property, plant or equipment" or comparable
items on the consolidated balance sheet of the Company and its Subsidiaries,
including, without limitation, all transactional costs incurred in connection
with such expenditures provided the same have been capitalized, excluding,
however, the amount of any Capital Expenditures paid for with proceeds of
casualty insurance as evidenced in writing and submitted to the Trustee together
with any compliance certificate delivered pursuant to the Credit Agreement, and
(ii) with respect to any Capital Lease entered into by the Company or any of its
Subsidiaries during such period, the capitalized amount of such Capital Lease,
all the foregoing in accordance with GAAP applied on a Consistent Basis.
"Capital Lease" means all leases which have been or should be capitalized
in accordance with GAAP as in effect from time to time, including Statement No.
13 of the Financial Accounting Standards Board and any successor thereof.
"Capitalized Lease Obligation" means any obligation to pay rent or other
amounts under a lease of (or other agreement conveying the right to use) any
property (whether real, personal or mixed) that is required to be classified and
accounted for as a Capital Lease and, for the purpose of this Indenture, the
amount of such obligation at any date shall be the capitalized amount thereof at
such date, determined in accordance with GAAP.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations, rights in, or other equivalents (however designated
and whether voting or non-voting) of such Person's capital stock or any form of
3
membership interest, as applicable, whether outstanding on the Issue Date or
issued after the Issue Date, and any and all rights, warrants or options
exercisable or exchangeable for or convertible into such capital stock.
"Cash Equivalents" means at any time (i) any evidence of Indebtedness with
a maturity of 180 days or less issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States of America is
pledged in support thereof); (ii) certificates of deposit or acceptances with a
maturity of 180 days or less of any financial institution that is a member of
the Federal Reserve System having combined capital and surplus and undivided
profits of not less than $500,000,000; (iii) commercial paper with a maturity of
180 days or less issued by a corporation (except an Affiliate of the Company)
organized under the laws of any state of the United States or the District of
Columbia and rated at least A-1 by Standard & Poor's Corporation or at least P-1
by Moody's Investors Service, Inc.; (iv) repurchase agreements and reverse
repurchase agreements relating to marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition; provided,
however, that the terms of such agreements comply with the guidelines set forth
in the Federal Financial Agreements of Depository Institutions with Securities
Dealers and Others, as adopted by the Comptroller of the Currency; and (v) money
market funds investing principally in the types of securities described in
clauses (i) and (ii) above.
"Certificate of Designations" means the Certificate of Designations,
Preferences and Rights of the Series F Preferred Stock, and the Certificate of
Designations, Preferences and Rights of the Series G Preferred Stock, as each
may at any time be amended, restated, supplemented or otherwise modified.
"Change of Control" means a change of control of the Company of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Exchange Act, whether or not the Company
is then subject to such reporting requirement; provided, that, without
limitation, such a Change of Control shall be deemed to have occurred if: (i)
any "person" (as defined in Sections 13(d) and 14(d) of the Exchange Act) or
"group" (as such term is used in Section 13(d)(3) of the Exchange Act) other
than Permitted Holders is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing thirty percent (30%) or more of the combined voting power
of the Company's then outstanding securities; or (ii) if there shall cease to be
a majority of the Board of Directors of the Company comprised of Continuing
Directors (as defined below); or (iii) the stockholders of the Company approve a
merger or consolidation of the Company with any other corporation, other than a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least eighty percent (80%) of the combined voting power of
the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation; or (iv) if any recapitalization
event occurs as a result of which the holders of voting securities of the
4
Company outstanding immediately prior thereto and/or the Permitted Holders do
not continue to hold at least eighty percent (80%) of the combined voting power
of the voting securities of the Company immediately after such recapitalization
event; or (v) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets; or (vi) a majority
of the "named executive officers" set forth in the Company's most recent Proxy
Statement or Annual Report on Form 10-K or Form 10-KSB, as the case may be,
cease to occupy such positions within a period of 365 consecutive days. As used
herein, "Continuing Directors" means individuals who as of the Effective Date
constitute the Board of Directors of the Company and any new director(s) (i)
whose election by the Board of Directors for the Company or nomination for
election by the Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
previously so approved or (ii) were designated by the Permitted Holders.
"Change of Control Date" has the meaning provided in Section 4.16.
"Change of Control Offer" has the meaning provided in Section 4.16.
"Change of Control Payment Date" has the meaning provided in Section 4.16.
"Company" means the party named as such in this Indenture until a successor
replaces it pursuant to the terms and conditions of this Indenture and
thereafter means such successor.
"Company Order" means a written order or request signed in the name of the
Company by its President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Consistent Basis" in reference to the application of GAAP means the
accounting principles observed in the period referred to are comparable in all
material respects to those applied in the preparation of the audited financial
statements of the Company contained in the Company's Annual Report on Form
10-KSB for the fiscal year ended December 31, 2001 filed with the Commission.
"Consolidated EBITDA" means, with respect to the Company and its
Subsidiaries for any Four-Quarter Period ending on the date of computation
thereof, the sum of, without duplication, (i) Consolidated Net Income, (ii)
Consolidated Interest Expense, (iii) taxes on income, (iv) amortization, (v)
depreciation, all determined on a consolidated basis in accordance with GAAP
applied on a Consistent Basis, (vi) goodwill impairment required by FASB
141-142, to the extent the same is deducted from income to derive Net Income and
(vii) Restructuring Costs; provided, however, that with respect to an
Acquisition that is accounted for as a "purchase", for the four Four-Quarter
Periods ending next following the date of such Acquisition, Consolidated EBITDA
shall include the results of operations of the Person or assets so acquired,
which amounts shall be determined on a historical pro forma basis as if such
Acquisition had been consummated as a "pooling of interests"; provided, further,
however, that with respect to disposition, sale, conveyance, transfer,
liquidation or cessation of business of a Subsidiary of the Company or any
division, operating unit or other business unit of the Company during such
measurement period, Consolidated EBITDA shall exclude the results of operations
of the Subsidiary division, operating unit or other business unit so disposed,
sold, conveyed, transferred, liquidated or the business of which has ceased.
5
"Consolidated Fixed Charge Ratio" means, with respect to the Company and
its Subsidiaries for the applicable period described below ending on the date of
computation thereof, the ratio of (i) Consolidated EBITDA for such period less
(without duplication) Capital Expenditures for such period, to (ii) Consolidated
Fixed Charges for such period.
"Consolidated Fixed Charges" means, with respect to the Company and its
Subsidiaries for any Four-Quarter Period (or other period of Fiscal Quarters as
provided in the definitions of "Consolidated Fixed Charge Ratio") ending on the
date of computation thereof, the sum of, without duplication, (i) Consolidated
Interest Expense incurred during such period, (ii) scheduled principal amounts
of Consolidated Funded Indebtedness (other than the principal amount of
borrowings outstanding under the Credit Agreement) paid during such period,
(iii) Earnouts paid in cash during such period, and (iv) all Restricted Payments
made during such period, all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Consolidated Funded Indebtedness" means, with respect to the Company and
its Subsidiaries, at any time as of which the amount thereof is to be
determined, the sum of (i) Indebtedness for Money Borrowed of the Company and
its Subsidiaries at such time and (ii) the face amount of all outstanding
Letters of Credit issued for the account of the Company or any of its
Subsidiaries and all obligations (to the extent not duplicative) arising under
such Letters of Credit, all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Consolidated Interest Coverage Ratio" means, with respect to the Company
and its Subsidiaries the ratio of (i) Consolidated EBITDA to (ii) Consolidated
Interest Expense for each Four-Quarter Period then ended.
"Consolidated Interest Expense" means, with respect to any period of
computation thereof, the gross interest expense of the Company and its
Subsidiaries, including without limitation (i) the current amortized portion of
debt discounts to the extent included in gross interest expense, (ii) the
current amortized portion of all fees (including fees payable in respect of any
Hedging Obligation) payable in connection with the incurrence of Indebtedness to
the extent included in gross interest expense (but not including any fees
incurred in connection with the Credit Agreement and this Agreement or the
termination thereof), and (iii) the portion of any payments made in connection
with Capital Leases allocable to interest expense, all determined on a
consolidated basis in accordance with GAAP applied on a Consistent Basis.
"Consolidated Leverage Ratio" means, as of the date of computation thereof,
the ratio of (i) Consolidated Funded Indebtedness determined as at such date to
(ii) Consolidated EBITDA for the Four-Quarter Period ending on (or most recently
ended prior to) such date.
"Consolidated Net Income" means, for any period of computation thereof, the
gross revenues from operations of the Company and its Subsidiaries (including
payments received by the Company and its Subsidiaries of (i) interest income,
and (ii) dividends and distributions made in the ordinary course of their
businesses by Persons in which investment is permitted pursuant to this
Indenture and the Credit Agreement and not related to an extraordinary event),
less all operating and non-operating expenses of the Company and its
Subsidiaries including taxes on income, all determined on a consolidated basis
6
in accordance with GAAP applied on a Consistent Basis; but excluding (for all
purposes other than compliance with Section 4.20) as income: (a) net gains on
the sale, conversion or other disposition of capital assets, (b) net gains on
the acquisition, retirement, sale or other disposition of Capital Stock and
other securities of the Company or its Subsidiaries, (c) net gains on the
collection of proceeds of life insurance policies, (d) any write-up of any
asset, and (e) any other net gain or credit of an extraordinary nature as
determined in accordance with GAAP applied on a Consistent Basis.
"Consolidated Net Worth" means, as of any date on which the amount thereof
is to be determined, Consolidated Shareholders' Equity minus (without
duplication of deductions in respect of items already deducted in arriving at
surplus and retained earnings) all reserves (other than contingency reserves not
allocated to any particular purpose), including without limitation reserves for
depreciation, depletion, amortization, obsolescence, deferred income taxes,
insurance and inventory valuation all as determined on a consolidated basis in
accordance with GAAP applied on a Consistent Basis.
"Consolidated Shareholders' Equity" means, as of any date on which the
amount thereof is to be determined, the sum of the following in respect of the
Company and its Subsidiaries (determined on a consolidated basis and excluding
any upward adjustment after the Issue Date due to revaluation of assets): (i)
the amount of issued and outstanding share capital, plus (ii) the amount of
additional paid-in capital and retained earnings (or, in the case of a deficit,
minus the amount of such deficit), plus (iii) the amount of any foreign currency
translation adjustment (if positive, or, if negative, minus the amount of such
translation adjustment), minus (iv) the amount of any treasury stock all as
determined in accordance with GAAP applied on a Consistent Basis.
"Contingent Obligation" of any Person means all contingent liabilities
required (or which, upon the creation or incurring thereof, would be required)
to be included in the financial statements (including footnotes) of such Person
in accordance with GAAP applied on a Consistent Basis, including Statement No. 5
of the Financial Accounting Standards Board, all Hedging Obligations and any
obligation of such Person guaranteeing or in effect guaranteeing any
Indebtedness, dividend or other obligation of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including obligations
of such Person however incurred:
(1) to purchase such Indebtedness or other obligation or any property or
assets constituting security therefor;
(2) to advance or supply funds in any manner (i) for the purchase or
payment of such Indebtedness or other obligation, or (ii) to maintain a minimum
working capital, net worth or other balance sheet condition or any income
statement condition of the primary obligor;
(3) to grant or convey any Lien, charge or other encumbrance on any
property or assets of such Person to secure payment of such Indebtedness or
other obligation;
(4) to lease property or to purchase securities or other property or
services primarily for the purpose of assuring the owner or holder of such
Indebtedness or obligation of the ability of the primary obligor to make payment
of such Indebtedness or other obligation; or
7
(5) otherwise to assure the owner of the Indebtedness or such obligation of
the primary obligor against loss in respect thereof.
; provided, however, in no event shall Earnouts be a Contingent Obligation
hereunder.
"Credit Agreement" means the Amended and Restated Credit Agreement, dated
as of the date hereof and effective as of March 31, 2002, entered into between
the Company and Bank of America, N.A., as agent, Fleet National Bank, as
co-agent, and the lenders party thereto, providing for working capital and other
financing, as the same may at any time be amended, amended and restated,
supplemented or otherwise modified, including any refinancing, refunding,
replacement or extension thereof permitted hereunder which provides for working
capital and other financing, whether by the same or any other lender or group of
lenders.
"Custodian" means any receiver, trustee, assignee, liquidator, sequestrator
or similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or the passage of time
or both would be, an Event of Default.
"Default Amount" shall have the meaning set forth in Section 6.02.
"Depository" means, with respect to the Securities issuable or issued in
one or more Book-Entry Securities, the Person specified in Section 2.02 as the
Depository with respect to the Securities until the successor shall have been
appointed and becomes such pursuant to the applicable provisions of this
Indenture, and, thereafter, "Depository" shall mean or include such successor.
"Disqualified Stock" means with respect to any Person, any Capital Stock
which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable, in each case, at the option of the
holder thereof), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is
exchangeable for Indebtedness, or is redeemable at the option of the holder
thereof, in whole or in part, on or prior to the Maturity Date.
"Domestic Subsidiary" means a Subsidiary which is organized under the laws
of one of the states or territories comprising the United States of America.
"Earnouts" has the specific meaning therefor set forth in each of the
Acquisition Documents and collectively means all such payments, a schedule of
such Earnouts with respect to Acquisitions consummated prior to the Issue Date
is set forth on Schedule 5.35 to the Securities Purchase Agreement.
"Effective Date" means March 31, 2002.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Event of Default" has the meaning provided in Section 6.01.
8
"Excess Proceeds" shall have the meaning set forth in Section 4.18.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the SEC thereunder.
"Fair Market Value" or "fair value" means, with respect to any asset or
property, the price which could be negotiated in an arm's-length free market
transaction, for cash, between a willing seller and a willing buyer, neither of
whom is under undue pressure or compulsion to complete the transaction. With
respect to any Person, Fair Market Value shall be determined by the Board of
Directors of such Person (and with respect to the Company or any of its
Subsidiaries, a majority of the Independent Directors of the Company) acting in
good faith and shall be evidenced by a Board Resolution thereof delivered to the
Trustee.
"Financing" means the consummation of the sale by the Company of the
Securities and $20,000,000 of the Series F Preferred Stock.
"Financing Documents" means this Indenture, the Certificate of
Designations, the Stock Purchase Agreement, the Registration Rights Agreement,
the Guaranty Agreement, the First Limited Waiver and Amendment, the Second
Limited Waiver, the Mezzanine Warrants and any other document executed by or on
behalf of the Company in connection with the Financing and any amendment of any
of the terms of the foregoing.
"Fiscal Quarter" means a three month quarter of a Fiscal Year and when
followed by reference to a year, means the first, second, third or fourth
quarter of such Fiscal Year, as indicated.
"Fiscal Year" means the twelve month fiscal period of the Company and its
Subsidiaries commencing on January 1 of each calendar year and ending on
December 31 of such calendar year.
"First 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.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect as of the date hereof and as such principles may be
amended from time to time, including, without limitation, those set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are applicable as of the date of
determination.
"GarMark" means GarMark Partners, L.P.
"Global Security" means a Security evidencing all or a part of the
Securities to be issued as Book-Entry Securities, issued to the Depository in
accordance with Section 2.02 and bearing the legend prescribed in Exhibit B to
this Indenture.
9
"Guarantor" means each Domestic Subsidiary of the Company now or
hereinafter existing which has executed the Guaranty Agreement.
"Guaranty Agreement" means the Guaranty Agreement, dated as of March 19,
1998, by and among each of the Company's Domestic Subsidiaries and the Trustee,
for the benefit of the Holders, substantially in the form on Exhibit F to the
Securities Purchase Agreement, as amended, modified or supplemented from time to
time in accordance with the terms thereof, together with any exhibits, schedules
or attachments thereto.
"Hedging Obligations" means any and all obligations of the Company or any
of its Subsidiaries, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all
agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates
(including without limitation commodity exchange rates) or forward rates
applicable to such party's assets, liabilities or exchange transactions,
including, but not limited to, U.S. dollar-denominated or cross-currency
interest rate exchange agreements, forward currency exchange agreements,
commodity exchange agreements, interest rate cap or collar protection
agreements, forward rate currency or interest rate options, puts, warrants and
those commonly known as interest rate "swap" agreements; and (ii) any and all
cancellations, buybacks, reversals, terminations or assignments of any of the
foregoing.
"Holder" or "Securityholder" means the person in whose name a Security is
registered on the Registrar's books.
"IAI Global Security" means a permanent global security in a registered
form representing the aggregate principal amount of Securities sold to
Institutional Accredited Investors.
"Indebtedness" means, with respect to any person, without duplication, (i)
any liability, contingent or otherwise, of such Person (a) for borrowed money
(whether or not the recourse of the lender is to the whole of the Property of
such Person or only to a portion thereof), (b) evidenced by bonds, notes,
debentures or similar instruments or representing the balance deferred and
unpaid of any part of the purchase price of Property or other assets (including
Investments) or for the cost of Property or other assets constructed or of
improvements thereto (including any obligation under or in connection with any
letter of credit related thereto), (c) under or in connection with any letter of
credit issued for the account of such Person, and all drafts drawn,
reimbursement obligations or demands for payment thereunder, or (d) for the
payment of money relating to any Capitalized Lease Obligations; (ii) any
liability of others of the kind described in the preceding clause (i) which the
Person has guaranteed or which is otherwise its legal liability; (iii) any
liability, contingent or otherwise, secured by any Lien in respect of Property
of such Person, whether or not the obligations secured thereby shall have been
assumed by or shall otherwise be such Person's legal liability, provided, that,
solely in the case of any Indebtedness of the type described in this clause
(iii), recourse for the payment of which is limited to such Property, the amount
of such Indebtedness shall be deemed to be the lesser of the fair market value
of such Property or the amount of the obligation so secured; and (iv) any and
all deferrals, renewals, extensions and refundings of, or amendments,
10
modifications or supplements to, any liability of the kind described in any of
the preceding clauses (i), (ii) and (iii). The amount of Indebtedness of any
Person at any date shall be the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability of such
Person in respect of any such contingent obligations at such date.
"Indebtedness for Money Borrowed" means with respect to any Person, without
duplication, all indebtedness in respect of money borrowed of such Person,
including without limitation all Capital Leases and the deferred purchase price
of any property or asset, evidenced by a promissory note, bond, debenture or
similar written obligations for the payment of money (including conditional
sales or similar title retention agreements), other than trade payables incurred
in the ordinary course of business.
"Indenture" means this Indenture, as amended, restated or supplemented from
time to time in accordance with the terms hereof.
"Independent Director" means any director that (i) is not and has not been
an officer or employee of the Company or any of its Affiliates, (ii) does not
have any relationship that, in the opinion of the Board of Directors of the
Company (exclusive of any such Independent Director), would interfere with
his/her exercise of independent judgment in carrying out the responsibilities of
director and (iii) with respect to any transaction or series of related
transactions, does not have any material direct or indirect financial interest
in or with respect to such transaction or series of related transactions.
"Initial Holder" means the Holders on the Issue Date and their respective
Affiliates.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Payment Date" means the stated maturity of an installment of
interest on the Securities.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended
to the date hereof and from time to time hereafter.
"Investment" means, with respect to any Person, any direct or indirect
advance, loan or other extension of credit to (including any guarantee of a loan
or other extension of credit) or investment in, capital contribution to (by
means of any transfer of cash or other Property to others or any payment for
Property for the account or use of others or otherwise including, without
limitation, amounts paid in advance on account of the purchase price of
merchandise or equipment to be delivered within one year of the date of
advance), or purchase of Capital Stock, bonds, notes, debentures or other
securities issued by, any other Person.
"Issue Date" means the date of first issuance of the Securities under this
Indenture.
"Legal Holiday" means, with respect to a particular place of payment, a
Saturday, a Sunday or a day on which banking institutions in New York, New York
11
or at such place of payment are authorized or obligated by law, executive order
or governmental decree to be closed.
"Lien" means any mortgage, lien, pledge, charge, security interest,
encumbrance, claim, hypothecation, assignment for security, deposit arrangement
or preference or other security agreement of any kind or nature whatsoever,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement and any lease
deemed to constitute a security interest). For purposes hereof, a Person shall
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, capital lease or other title retention agreement.
"Material Subsidiary" means, with respect to any person, any Subsidiary of
such person which would be a "significant subsidiary" pursuant to Article 1-02
of Regulation S-X.
"Maturity Date" means March 19, 2006.
"Mezzanine Preferred Stock" means the Series G Preferred Stock or any other
shares of Preferred Stock into or for which the Series G Preferred Stock is
exchanged.
"Mezzanine Warrants" means the warrants issued to the Holders pursuant to
the First Limited Waiver and Amendment and/or the Second Limited Waiver.
"Minimum Required Holders" means the Initial Holders of at least thirty
percent (30%) in aggregate principal amount of the outstanding Securities;
provided that in the event that each Initial Holder, other than GarMark, shall
own less than 100% in the aggregate principal of the outstanding Securities
owned by such Initial Holder on the Issue Date, then such term shall mean the
Holder or Holders of at least thirty-five percent (35%) of the aggregate
principal amount of the outstanding Securities.
"Moore" means Remington Investment Strategies, L.P. and Moore Global
Investments, Ltd. or any of their Affiliates.
"Multiemployer Plan" means a plan described in Section 3(37) of ERISA.
"Net Cash Proceeds" means, with respect to any Asset Sale the proceeds
thereof in the form of cash or Cash Equivalents, including payments in respect
of deferred payment obligations when received in the form of cash or Cash
Equivalents 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 within one year as a
result of such Asset Sale; (iii) payments made to retire Indebtedness secured by
the assets subject to such Asset Sale to the extent required pursuant to the
terms of such Indebtedness; (iv) appropriate amounts to be provided by the
Company or any of its Subsidiaries, as the case may be, as a reserve, required
in accordance with GAAP against any liabilities associated with such Asset Sale
and retained by the Company or any of its Subsidiaries, as the case may be,
after such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to environmental
12
matters and liabilities under any indemnification obligations associated with
such Asset Sale, provided, however, that the amount of any such reserve at such
time that such amount is no longer required to be provided as a reserve in
accordance with GAAP and is not applied to the liability for which such reserve
was established shall be deemed Net Cash Proceeds; and (v) any amount required
to be paid to any Person owning a beneficial interest in the Property sold,
conveyed, transferred, leased or otherwise disposed of in an amount
proportionate to such beneficial interest.
"Net Equity Proceeds" means, with respect to an Asset Sale, the Net
Proceeds therefrom relating to the sale of Capital Stock by the Company or any
Subsidiary thereof.
"Net Proceeds" means, with respect to any Person (a) in the case of any
sale of Capital Stock by such Person or common equity contribution to such
Person, the aggregate net proceeds received by such Person after payment of
expenses, commissions and the like, if any, incurred in connection therewith,
(b) in the case of the issuance of any Indebtedness by such Person, the
aggregate net proceeds received by such Person, after payment of expenses,
commissions and the like incurred in connection therewith, or (c) in the case of
any exchange, exercise, conversion or surrender of outstanding securities of any
kind of the Company for or into shares of Capital Stock of the Company which is
not Disqualified Stock, the net proceeds received by the Company upon such
exchange, exercise, conversion or surrender (plus, with respect to the issuance
of any such securities after the Issue Date, the net proceeds received by such
Person upon the issuance of such securities), less any and all payments made to
the holders, e.g., on account of fractional shares, and less all expenses,
commissions and the like incurred by the Company in connection therewith.
"Non-U.S. Person" means a person who is not a U.S. person as defined in
Regulation S.
"Obligations" means all obligations for principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing any Indebtedness.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, any Vice President, the Chief Operating
Officer, the Chief Financial Officer, the Treasurer, the Controller, the
Secretary or the Assistant Secretary of such Person.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by two Officers (one of whom shall be the Chief Financial Officer) or by
an Officer and either an Assistant Treasurer or an Assistant Secretary of such
Person and otherwise complying with the requirements of Sections 11.04 and
11.05.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee complying with the requirements of Sections 11.04 and
11.05. Unless otherwise required by the TIA, the legal counsel may be an
employee of or counsel to the Company.
"Paying Agent" has the meaning provided in Section 2.03.
13
"Permitted Acquisition" means each Acquisition effected with the consent
and approval of the Board of Directors of the Person being acquired, and with
the duly obtained approval of such shareholders or other holders of equity or
other ownership interest as such Person may be required to obtain, so long as
the prior written consent of the Required Holders has been obtained.
"Permitted Holders" means the initial purchasers of the Securities and
their respective Affiliates.
"Permitted Investments" means (i) obligations of the United States
government due within one year; (ii) certificates of deposit or Eurodollar
deposits due within one year with a financial institution that is a member of
the Federal Reserve System having combined capital and surplus and undivided
profits of at least $500,000,000 or more; (iii) commercial paper rated at least
A-1 by Standard & Poor's Corporation or at least P-1 by Moody's Investors
Service, Inc.; (iv) debt of any state or political subdivision that is rated
among the two highest rating categories obtainable from either Standard & Poor's
Corporation or Moody's Investors Service, Inc. and is due within one year; (v)
repurchase agreements and reverse repurchase agreements relating to marketable
direct obligations issued or unconditionally guaranteed by the United States
Government or issued by any agency thereof and backed by the full faith and
credit of the United States, in each case maturing within one year from the date
of acquisition; provided, however, that the terms of such agreements comply with
the guidelines set forth in the Federal Financial Agreements of Depository
Institutions with Securities Dealers and Others, as adopted by the Comptroller
of the Currency; and (vi) Investments represented by Hedging Obligations
permitted to be made pursuant to Section 4.25.
"Permitted Liens" means, with respect to any Person, any Lien arising by
reason of (a) any judgment, decree or order of any court, so long as such Lien
is being contested in good faith and is adequately bonded, and any appropriate
legal proceedings which may have been duly initiated for the review of such
judgment, decree or order shall not have been finally terminated or the period
within which such proceedings may be initiated shall not have expired; (b) Liens
arising by operation of law for taxes, assessments, governmental charges or
claims not yet delinquent or which are being contested in good faith by
appropriate proceedings promptly instituted and diligently conducted and if a
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefore and enforcement is stayed
and which Liens are not yet enforceable against other creditors; (c) security
for payment of workers' compensation or other insurance or social security
legislation; (d) security for the performance of tenders, contracts (other than
contracts for the payment of money) or leases (including any Capitalized Lease
Obligations, provided that such Capitalized Lease Obligations are permitted to
be incurred pursuant to the terms of Section 4.11 hereof) incurred in the
ordinary course of business; (e) deposits to secure public or statutory
obligations, or in lieu of surety, performance or appeal bonds, entered into in
the ordinary course of business; (f) Liens arising by operation of law in favor
of carriers, warehousemen, landlords, mechanics, materialmen, laborers,
employees or suppliers, incurred in the ordinary course of business for sums
which are not yet delinquent or are being contested in good faith by
negotiations or by appropriate proceedings which suspend the collection thereof
14
and if a reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor and which Liens are not yet
enforceable against other creditors; (g) easements, rights-of-way, zoning and
similar covenants and restrictions and other similar encumbrances or title
defects which, in the aggregate, are not substantial in amount, and which do not
in any case materially detract from the value of the Property subject thereto or
materially interfere with the ordinary conduct of the business of the Company or
any of its Subsidiaries; (h) Liens arising in the ordinary course of business in
favor of custom and revenue authorities to secure payment of custom duties; (i)
Liens existing as of the Effective Date; and (j) Liens securing the Indebtedness
of the Company and its Subsidiaries pursuant to Section 4.11(b) hereof.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or any
other entity or organization including a government or political subdivision or
any agency or instrumentality thereof.
"Physical Securities" has the meaning set forth in Section 2.02.
"Plan" means an employment benefit plan within the meaning of Section 3(3)
of ERISA.
"Preferred Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated) of such
Person's preferred or preference stock, whether now outstanding or issued after
the Effective Date, and including, without limitation, all classes and series of
preferred or preference stock of such Person.
"Principal" of any Indebtedness (including the Securities) means the
principal of such Indebtedness plus the premium, if any, on such Indebtedness.
"Private Placement Legend" means the legend initially set forth on the
Securities as set forth in Exhibit A.
"Property" or "property" means any assets or property of any kind or nature
whatsoever, real, personal or mixed (including fixtures), whether tangible or
intangible.
"Qualified Institutional Buyer" or "QIB" shall have the meaning specified
in Rule 144A under the Securities Act.
"Record Date" means the Record Dates specified in the Securities; provided
that if any such date is a Legal Holiday, the Record Date shall be the first day
immediately preceding such specified day that is not a Legal Holiday.
"Redemption Date" when used with respect to any Security to be redeemed,
means the date fixed for such redemption pursuant to this Indenture and the
Securities.
"Redemption Price" when used with respect to any Security to be redeemed,
means the price fixed for such redemption pursuant to this Indenture and the
Securities; provided that the Redemption Price prior to the first anniversary of
the Issue Date is 105% of the Principal of the Securities to be redeemed.
"Registrar" has the meaning provided in Section 2.03.
15
"Registration Rights Agreement" means the Registration Rights Agreement by
and among the Company and the investors named therein, dated as of March 19,
1998, as the same may be amended, supplemented or otherwise modified from time
to time in accordance with the terms thereof.
"Regulation S" means Regulation S under the Securities Act.
"Regulation S Global Security" means a permanent global security in
registered form representing the aggregate principal amount of Securities sold
in reliance on Regulation S.
"Representative" means the trustee, agent or representative in respect of
any Senior Indebtedness and shall mean NationsBank, National Association in such
capacity, until such time as it is no longer the representative pursuant to the
terms of the Credit Agreement; provided, however, that if, and for so long as,
any Senior Indebtedness lacks such a representative, then the Representative for
such Senior Indebtedness shall at all times constitute the holders of a majority
in outstanding principal amount of such Senior Indebtedness in respect of any
Senior Indebtedness.
"Required Holders" means (i) the Initial Holders holding at least (A)
seventy percent (70%) of the aggregate principal amount of the outstanding
Securities or (B) two thirds of the aggregate principal amount of the
outstanding Securities on or after the date upon which Moore owns less than one
hundred percent (100%) of the Securities acquired by it on the Issue Date, or
(ii) in the event that each of the Initial Holders, other than GarMark, shall
own less than fifty percent (50%) of the aggregate principal amount of the
outstanding Securities owned by such Initial Holder on the Issue Date, then such
term shall mean the Holders of at least a majority of the aggregate principal
amount of outstanding Securities.
"Restricted Payment" means any of the following: (i) the declaration or
payment of any dividend or any other distribution on Capital Stock of the
Company or any of its Subsidiaries or any payment made to the direct or indirect
holders (in their capacities as such) of Capital Stock of the Company or any of
its Subsidiaries (other than (x) dividends or distributions payable solely in
Capital Stock (other than Disqualified Stock), in options, warrants or other
rights to purchase Capital Stock (other than Disqualified Stock) or as an
accretion to the liquidation preference of Capital Stock (other than
Disqualified Stock), (y) in the case of Subsidiaries of the Company, dividends
or distributions payable to the Company or to a Wholly-Owned Subsidiary of the
Company), (ii) the purchase, redemption or other acquisition or retirement for
value of any Capital Stock of the Company or any of its Subsidiaries, (iii) the
making of any principal payment on, or the purchase, defeasance, repurchase,
redemption or other acquisition or retirement for value, prior to any scheduled
maturity, scheduled repayment or scheduled sinking fund payment, of any
Indebtedness of the Company which is subordinated in right of payment to the
Securities (other than Indebtedness of the Company acquired in anticipation of
satisfying a sinking fund obligation, principal installment or final maturity,
in each case due within one year of the date of acquisition), and (iv) the
making of any Investment other than pursuant to clause (i), (ii), (iv) or (v) of
Section 4.15 hereof.
"Restricted Security" has the meaning set forth in Rule l44(a)(3) under the
Securities Act.
16
"Restructuring Costs" means any reasonable, out-of-pocket costs, fees and
expenses incurred in connection with the preparation, execution and delivery of
this Amended and Restated Indenture, the Second Limited Waiver or the amendment
and restatement of the Credit Agreement entered into on or about the date hereof
and any other agreement contemplated hereby or thereby to be executed
substantially concurrently with this Amended and Restated Indenture, including,
but only to the extent not set forth in the Budget (as defined in the Credit
Agreement as in effect on the date hereof) delivered prior to the Effective
Date, any costs, fees and expenses relating to management and other employee
retention agreements.
"Sale/Leaseback Transaction" means any direct or indirect arrangement with
any person providing for the leasing to the Company or any of its Subsidiaries
of any real or tangible personal property (except for leases between or among
the Company and any of its Subsidiaries), which property or similar property has
been or is to be sold or transferred by the Company or such Subsidiary to such
person in contemplation of such leasing.
"SEC" means the Securities and Exchange Commission.
"Second Limited Waiver" means that certain Second Limited Waiver dated as
of the date hereof, by and among the Company, the Trustee and the Holders, as
the same may be amended, supplemented or otherwise modified from time to time.
"Securities" means, the Company's Increasing Rate Senior Subordinated Notes
due 2006, as amended or supplemented from time to time in accordance with the
terms hereof, that are issued pursuant to the terms and conditions of this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Senior Debt Other Default" has the meaning provided in Section 10.02
hereof.
"Senior Debt Payment Default" has the meaning provided in Section 10.02
hereof.
"Senior Indebtedness" means all Indebtedness and other amounts owing under
the Credit Agreement or any refinancing, refunding, replacement or extension
thereof.
"Series F Preferred Stock" means the Series F Convertible Preferred Stock,
par value $.0001, of the Company, that was issued on the Issue Date and later in
exchange for an equal number of shares of Series G Preferred Stock.
"Series G Preferred Stock" means the Series G Convertible Preferred Stock,
par value $.0001, of the Company.
"Securities Purchase Agreement" means the Securities Purchase Agreement by
and among the Company and the investors named therein, dated as of March 19,
1998, as the same may be amended, supplemented or otherwise modified from time
to time in accordance with the terms thereof.
17
"Subsidiary" means with respect to any Person (i) a corporation a majority
of whose Capital Stock with voting power, under ordinary circumstances, to elect
directors is at the time, directly or indirectly, owned by such Person, by one
or more Subsidiaries of such Person or by such Person and one or more
Subsidiaries of such Person or (ii) any other Person (other than a corporation)
in which such Person, one or more Subsidiaries of such Person or such Person and
one or more subsidiaries of such Person, directly or indirectly, individually or
with another Person, at the date of determination thereof, has (a) at least a
majority ownership interest or (b) the power to elect or direct the election of
a majority of the directors or other governing body of such Person.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. SS 77aaa-77bbbb), as
amended, as in effect on the date of the execution of this Indenture.
"Trustee" means the party named as such in this Indenture until a successor
replaces it in accordance with the provisions of this Indenture and thereafter
means such successor.
"Trust Officer" means any officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"U.S. Government Obligations" means direct non-callable obligations of, or
non-callable obligations guaranteed by, the United States of America for the
payment of which obligation or guarantee the full faith and credit of the United
States of America is pledged.
"U.S. Legal Tender" means such coin or currency of the United States of
America as at the time of payment shall be legal tender for the payment of
public and private debts.
"Voting Power" means with respect to any Person, the power under ordinary
circumstances, pursuant to the ownership of shares of any class or classes of
Capital Stock, 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, stock
of any other class or classes shall have, or might have, voting power by reason
of the happening of any contingency).
"Warrants" means the Series E Warrants issued by the Company pursuant to
that certain Warrant Purchase Agreement dated as of May 31, 1996, as hereafter
amended.
"Wholly-Owned Subsidiary" means with respect to any Person any Subsidiary
of such person, 100% of the Capital Stock of which (other than shares of Capital
Stock representing any director's qualifying shares or investments by foreign
nationals mandated by applicable law) is owned by such Person, by a Wholly-Owned
Subsidiary of such Person or by such Person and one or more Wholly-Owned
Subsidiaries of such Person.
SECTION 1.02. Incorporation by Reference of TIA.
Whenever this Indenture refers to a provision of the TIA, such provision is
incorporated by reference in, and made a part of, this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
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"indenture securities" means the Securities.
"indenture security holder" means a Holder or a Security holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company or any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
SECTION 1.03. Rules of Construction.
(a) Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and words in the
plural include the singular;
(v) provisions apply to successive events and transactions;
(vi) the words "include" and "including" shall be deemed to mean
"include, without limitation," and "including, without limitation";
(vii) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article,
Section or other subdivision;
(viii) references to Sections or Articles means references to
such Section or Article in this Indenture, unless stated otherwise;
and
(ix) references to sections of or rules under the Securities Act
shall be deemed to include substitute, replacement or successor
sections or rules adopted by the SEC from time to time.
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ARTICLE II.
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Trustee's certificate of authentication with respect
thereto shall be substantially in the form of Exhibit A hereto, which is hereby
incorporated in and expressly made a part of this Indenture. The Securities may
have notations, legends or endorsements required by law, stock exchange rules,
usage or agreement to which the Company is subject, including without limitation
the legends set forth in Exhibits A and B hereto. The Company and the Trustee
shall approve the form of the Securities and any notation, legend or endorsement
on them. Each Security shall be dated the date of its authentication, shall bear
interest from the Issue Date and shall be payable on the Interest Payment Dates
and the Maturity Date.
The terms and provisions contained in the Securities shall constitute, and
are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
SECTION 2.02. Execution and Authentication.
One Officer shall sign (who shall have been duly authorized by all
requisite corporate actions) the Securities for the Company by manual or
facsimile signature. If an Officer whose signature is on a Security was an
Officer at the time of such execution but no longer holds that office at the
time the Trustee authenticates the Security, the Security shall nevertheless be
valid. A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate Securities for original issue up to an
aggregate principal amount of Ten Million dollars ($10,000,000) upon a written
order of the Company in the form of an Officers' Certificate to a Trust Officer
directing the Trustee to authenticate the Securities and certifying that all
conditions precedent to the issuance of the Securities contained herein have
been complied with. Upon the written order of the Company in the form of an
Officers' Certificate, the Trustee shall authenticate Securities in substitution
of Securities issued on the Issue Date to reflect any name change of the
Company. The aggregate principal amount of Securities outstanding at any time
may not exceed Ten Million dollars ($10,000,000) except as provided in Section
2.07 hereof.
The Principal and interest on Book-Entry Securities shall be payable to the
Depository or its nominee, as the case may be, as the sole registered owner and
the sole holder of the Book-Entry Securities represented thereby. The Principal
of and interest on Securities in certificated form ("Physical Securities") shall
be payable at the office of the Paying Agent.
The Trustee may appoint an authenticating agent reasonably acceptable to
the Company to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
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Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Company and Affiliates of the Company.
The Securities shall be issuable only in registered form without coupons in
denominations of $100,000 and any integral multiple of $1,000 in excess thereof.
If the Securities are to be issued in the form of one or more Global
Securities, then the Company shall execute and the Trustee shall authenticate
and deliver one or more Global Securities that (i) shall represent and shall be
in minimum denominations of $1,000, (ii) shall be registered in the name of the
Depository for such Global Security or Securities or the nominee of such
Depository, (iii) shall be delivered to the Trustee as custodian for such
Depository or pursuant to such Depository's instructions, and (iv) shall bear
the legend set forth in Exhibit B.
SECTION 2.03. Registrar and Paying Agent.
The Company shall maintain an office or agency in the Borough of Manhattan,
The City of New York, where (a) Securities may be presented or surrendered for
registration of transfer or for exchange (the "Registrar"), (b) Securities may
be presented or surrendered for payment (the "Paying Agent"), and (c) notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company may also from time to time designate one or
more other offices or agencies where the Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in the Borough of Manhattan, The City of New York, for such purposes. Neither
the Company nor any Affiliate of the Company shall act as Paying Agent. The
Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company, upon notice to the Trustee, may appoint one or more
co-Registrars and one or more additional paying agents reasonably acceptable to
the Trustee. The term "Paying Agent" includes any additional paying agent. The
Company initially appoints the Trustee as Registrar, Paying Agent and agent for
service of notices or demands in connection with the Securities and this
Indenture until such time as the Trustee has resigned or a successor has been
appointed. Securities, notices and demands may be delivered to the Trustee at 61
Broadway, 15th Floor, New York, New York 10006, Attn: Corporate Trust
Department.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which agreement shall incorporate the provisions
of the TIA. The agreement shall implement the provisions of this Indenture that
relate to such Agent. The Company shall promptly notify the Trustee of the name
and address of any such Agent. If the Company fails to maintain a Registrar or
Paying Agent, the Trustee shall act as such and shall be entitled to appropriate
compensation in accordance with Section 7.07 hereof.
SECTION 2.04. Paying Agent To Hold Assets in Trust.
The Company shall require each Paying Agent other than the Trustee to agree
in writing that each Paying Agent shall hold in trust for the benefit of the
Holders or the Trustee all assets held by the Paying Agent for the payment of
Principal of, or interest on, the Securities (whether such assets have been
21
distributed to it by the Company or any other obligor on the Securities), and
shall notify the Trustee of any Default by the Company (or any other obligor on
the Securities) in making any such payment. The Trustee may at any time during
the continuance of any Default by the Company in making any such payment, upon
written request to a Paying Agent, require such Paying Agent to distribute all
assets held by it to the Trustee and to account for any assets distributed. The
Company at any time may require a Paying Agent to distribute all assets held by
it to the Trustee and account for any assets disbursed. Upon distribution to the
Trustee of all assets that shall have been delivered by the Company to the
Paying Agent, the Paying Agent shall have no further liability for such assets.
SECTION 2.05. Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
the Holders and shall otherwise comply with TIA ss.312(a). If the Trustee is not
the Registrar, the Company shall furnish to the Trustee five (5) days before
each Record Date and at such other times as the Trustee may request in writing a
list as of such date and in such form as the Trustee may reasonably require of
the names and addresses of the Holders, which list may be conclusively relied
upon by the Trustee, and the Company shall otherwise comply with TIA ss.312(a).
SECTION 2.06. Transfer and Exchange.
When Securities in certificated form are presented to the Registrar or a
co-Registrar with a request from the Holder thereof to register the transfer of
such Securities or to exchange such Securities for an equal principal amount of
Securities of other authorized denominations, the Registrar or co-Registrar, as
the case may be, shall register the transfer or make the exchange as requested
if its requirements for such transaction are met; provided, however, that the
Securities surrendered for registration of transfer or exchange shall be duly
endorsed or accompanied by a written instrument of transfer in form satisfactory
to the Company and the Registrar, or co-Registrar, as the case may be, duly
executed by the Holder thereof or such Holder's attorney duly authorized in
writing. To permit registrations of transfers and exchanges, the Company shall
execute by manual or facsimile signature and issue, and the Trustee shall
authenticate new Securities evidencing such transfer or exchange at the
Registrar's or co-Registrar's request, as the case may be. No service charge
shall be made for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge payable upon exchanges or
transfers pursuant to Section 2.02, 2.07, 2.10, 3.06, 4.17, 4.18 or 9.05). The
Registrar or co-Registrar shall not be required to register the transfer of or
exchange of any Security (i) during a period beginning at the opening of
business fifteen (15) days before the mailing of a notice of redemption of
Securities and ending at the close of business on the day of such mailing and
(ii) selected for redemption in whole or in part pursuant to Article III, except
the unredeemed portion of any Security being redeemed in part.
Notwithstanding any other provision of this Section 2.06, a Global Security
representing Book-Entry Securities may not be transferred in whole except by the
Depository to a nominee of the Depository or by a nominee of the Depository to
22
the Depository or another nominee of the Depository or by the Depository or any
such nominee to a successor depository or a nominee of such successor
depository.
Notwithstanding the foregoing, no Global Security shall be registered for
transfer or exchange, or authenticated and delivered, whether pursuant to this
Section 2.06, Section 2.07, 2.10 or 3.06 or otherwise, in the name of a person
other than the Depository for such Global Security or its nominee until (i) the
Depository notifies the Company that it is unwilling or unable to continue as
Depository for such Global Security or if at any time the Depository ceases to
be a clearing agency registered under the Exchange Act, and a successor
depository is not appointed by the Company within thirty (30) days, (ii) the
Company executes and delivers to the Trustee a Company Order that all such
Global Securities shall be exchangeable or (iii) there shall have occurred and
be continuing an Event of Default.
Except as provided above, any Security authenticated and delivered upon
registration of transfer or, or in exchange for, or in lieu of, any Global
Security, whether pursuant to this Section 2.06, Section 2.07, 2.10 or 3.06 or
otherwise, shall also be a Global Security and bear the legend specified in
Exhibit B.
SECTION 2.07. Replacement Securities.
If a mutilated Security is surrendered to the Trustee or the Registrar or
if the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, the Company shall issue and the
Trustee, upon receipt of a Company Order, shall authenticate a replacement
Security if the Trustee's requirements are met. If required by the Trustee or
the Company, such Holder must provide an indemnity bond or other indemnity,
sufficient in the judgment of both the Company and the Trustee, to protect the
Company, the Trustee or any Agent from any loss which any of them may suffer if
a Security is replaced. The Company and the Trustee may charge such Holder for
their respective reasonable, out-of-pocket expenses in replacing a Security,
including reasonable fees and expenses of counsel. Every replacement Security
shall constitute an additional obligation of the Company and shall be entitled
to all benefits of this Indenture equally and proportionately with all other
Securities duly issued hereunder.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the Securities that have been
authenticated by the Trustee except those canceled by it, those delivered to it
for cancellation and those described in this Section as not outstanding. Except
as set forth in Section 2.09, a Security does not cease to be outstanding
because the Company or any of its Affiliates holds the Security.
If a Security is replaced pursuant to Section 2.07 (other than a mutilated
Security surrendered for replacement), it ceases to be outstanding unless the
Trustee receives proof satisfactory to it that the replaced Security is held by
a bona fide purchaser. A mutilated Security ceases to be outstanding upon
surrender of such Security and replacement thereof pursuant to Section 2.07.
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If the principal amount of any Security is considered paid under Section
4.01 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If on a Redemption Date or the Maturity Date the Paying Agent holds U.S.
Legal Tender sufficient to pay all of the Principal and interest due on the
Securities payable on that date and is not prohibited from paying such Principal
and interest due on such date, then on and after such date such Securities cease
to be outstanding and interest on them ceases to accrue.
SECTION 2.09. Treasury Securities.
In determining whether the Holders of the required principal amount of
Securities have concurred in any declaration of acceleration or notice of
default or direction, waiver or consent or any amendment, modification or other
change to this Indenture, the Securities owned by the Company or an Affiliate of
the Company shall be disregarded as though they were not outstanding, except
that, for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Securities that the
Trustee knows are so owned shall be disregarded.
SECTION 2.10. Temporary Securities.
Until definitive Securities are prepared and ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Securities upon
receipt of a written order of the Company in the form of an Officers'
Certificate. The Officers' Certificate shall specify the amount of temporary
Securities to be authenticated and the date on which the temporary Securities
are to be authenticated. Temporary Securities shall be substantially in the form
of definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate, upon receipt of a written
order of the Company pursuant to Section 2.02, definitive Securities in exchange
for temporary Securities. Until such exchange, Holders of temporary Securities
shall be entitled to the same rights, benefits and privileges as definitive
Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee, or at the direction of the Trustee, the Registrar or the
Paying Agent (other than the Company or a Subsidiary), and no one else, shall
cancel and, pursuant to a Company Order, shall dispose of all Securities
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and certification of their destruction (subject to the record
retention requirements of the Exchange Act) shall be delivered to the Company
unless, by a Company order, the Company shall direct that canceled Securities be
returned to it. Subject to Section 2.07, the Company may not issue new
Securities to replace Securities that it has paid or delivered to the Trustee
for cancellation. If the Company shall acquire any of the Securities, such
acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation pursuant to this Section 2.11.
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SECTION 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the Securities, it
shall, unless the Trustee fixes another record date pursuant to Section 6.10,
pay the defaulted interest, plus (to the extent lawful) any interest payable on
the defaulted interest to the persons who are Holders on a subsequent special
record date, which date shall be a Business Day at least five (5) Business Days
prior to the payment date, in each case at the rate provided in the Securities
and in Section 4.01 hereof. The Company shall fix or cause to be fixed such
special record date and payment date in a manner reasonably satisfactory to the
Trustee. At least fifteen (15) days before the subsequent special record date,
the Company shall mail or cause to be mailed to each Holder, with a copy to the
Trustee, a notice that states the subsequent special record date, the payment
date and the amount of defaulted interest, and interest payable on such
defaulted interest, if any, to be paid. The Company may also pay defaulted
interest in any other lawful manner.
SECTION 2.13. Deposit of Monies.
On or before 10:00 a.m. on each Interest Payment Date and the Maturity
Date, as the case may be, the Company shall deposit or cause to be deposited
with the Paying Agent, in immediately available funds, U.S. Legal Tender
sufficient to make cash payments, if any, due on such Interest Payment Date or
the Maturity Date, as the case may be, in a timely manner that permits the
Trustee to remit payment to the Holders on such Interest Payment Date or the
Maturity Date, as the case may be.
SECTION 2.14. CUSIP Number.
The Company in issuing the Securities may use one or more CUSIP numbers,
and if so, the Trustee shall use the CUSIP numbers in notices of redemption or
exchange as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Securities, and that reliance may be
placed only on the other identification numbers printed on the Securities.
SECTION 2.15. Restrictive Legends.
Each Global Security and Physical Security that constitutes a Restricted
Security shall bear the Private Placement Legend on the face thereof until after
the second anniversary of the later of the Issue Date and the last date on which
the Company or any Affiliate of the Company was the owner of such Security (or
any predecessor security) (or such shorter period of time as permitted by Rule
144(k) under the Securities Act or any successor provision thereunder) (or such
longer period of time as may be required under the Securities Act or applicable
state securities laws in the opinion of counsel for the Company, unless
otherwise agreed by the Company and the Holder thereof).
Each Global Security shall also bear the legend as set forth in Exhibit B.
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SECTION 2.16. Book Entry Provisions for Global Security.
(a) Members of, or participants in, the Depository ("Agent Members")
shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depository, or the Trustee as its
custodian, or under the Global Securities, and the Depository 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 Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a Holder of any Security.
(b) Transfers of a Global Security shall be limited to transfers in
whole, but not in part, to the Depository, its successors or their
respective nominees. Interests of beneficial owners in a Global Security
may be transferred or exchanged for Physical Securities in accordance with
the rules and procedures of the Depository and the provisions of Section
2.17. In addition, Physical Securities shall be transferred to all
beneficial owners in exchange for their beneficial interests in a Global
Security if (i) the Depository notifies the Company that it is unwilling or
unable to continue as Depository for the Global Securities and a successor
depositary is not appointed by the Company within ninety (90) days of such
notice or (ii) an Event of Default has occurred and is continuing and the
Registrar has received a written request from the Depository to issue
Physical Securities.
(c) In connection with any transfer or exchange of a portion of the
beneficial interest in a Global Security to beneficial owners pursuant to
paragraph (b) of this Section 2.16, the Registrar shall (if one or more
Physical Securities are to be issued) reflect on its books and records the
date and a decrease in the principal amount of such Global Securities in an
amount equal to the principal amount of the beneficial interest in the
Global Security to be transferred, and the Company shall execute and the
Trustee shall authenticate and deliver, one or more Physical Securities of
like tenor and amount.
(d) In connection with the transfer of an entire Global Security to
beneficial owners pursuant to paragraph (b) of this Section 2.16, such
Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute and the Trustee shall
authenticate and deliver, to each beneficial owner identified by the
Depository in exchange for its beneficial interest in the Global Security,
an equal aggregate principal amount of Physical Security of authorized
denominations.
(e) Any Physical Security constituting a Restricted Security delivered
in exchange for an interest in a Global Security pursuant to paragraph (c)
or (d) of this Section 2.16 shall, except as otherwise provided by
paragraphs (a)(i)(x) and (d) of Section 2.17, bear the Private Placement
Legend.
(f) The Holder of a Global Security may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
interest through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
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SECTION 2.17. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and
Non-U.S. Persons. The following provisions shall apply with respect to the
registration of any proposed transfer of a Security constituting a
Restricted Security to any Institutional Accredited Investor which is not a
QIB or to any Non-U.S. Person:
(i) The Registrar shall register the transfer of any Security
constituting a Restricted Security, whether or not such Security bears
the Private Placement Legend, if (x) the requested transfer is after
the second anniversary of the Issue Date (provided, however, that
neither the Company nor any Affiliate of the Company has held any
beneficial interest in such Security, or portion thereof, at any time
on or prior to the second anniversary of the Issue Date) or (y) (1) in
the case of a transfer to an Institutional Accredited Investor which
is not a QIB (excluding Non-U.S. Persons), the proposed transferee has
delivered to the Registrar a certificate substantially in the form of
Exhibit C hereto or (2) in the case of a transfer to a Non-U.S.
Person, the proposed transferor has delivered to the Registrar a
certificate substantially in the form of Exhibit C hereto; and
(ii) if the proposed transferee is an Agent Member and the
Securities to be transferred consist of Physical Securities which
after transfer are to be evidence by an interest in the IAI Global
Security or Regulation S Global Security, as the case may be, upon
receipt by the Registrar of (x) written instructions given in
accordance with the Depository's and the Registrar's procedures and
(y) the appropriate certificate, if any, required by clause (y) of
paragraph (i) above, the Registrar shall register the transfer and
reflect on its books and records the date and an increase in the
principal amount of the IAI Global Security to be transferred, and the
Trustee shall cancel the Physical Securities so transferred; and
(iii) if the proposed transferor is an Agent Member seeking to
transfer an interest in a Global Security, upon receipt by the
Registrar of (x) written instructions given in accordance with
Depository's and the Registrar's procedures and (y) the appropriate
certificate, if any, required by clause (y) of paragraph (i) above,
the Registrar shall register the transfer and reflect on its books and
records the date and (a) a decrease in the principal amount of the
Global Security from which such interests are to be transferred in an
amount equal to be the principal amount of the Securities to be
transferred and (B) an increase in the principal amount of the IAI
Global Security or the Regulation S Global Security, as the case may
be, in an amount equal to the principal amount of the Securities to be
transferred.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Security
constituting a Restricted Security to a QIB (excluding transfers to
Non-U.S. Persons):
(i) the Registrar shall register the transfer of any Restricted
Security if such transfer is being made by a proposed transferor who
has checked the box provided for on the form of Security stating, or
has otherwise advised the Company and the Registrar in writing, that
the sale has been made in compliance with the provisions of Rule 144A
to a transferee who has signed the certification provided for on the
form of Security stating, or has otherwise advised the Company and the
Registrar in writing, that it is purchasing the Security for its own
account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a QIB within
the meaning of Rule 144A, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received
27
such information regarding the Company as it has requested pursuant to
Rule 144A or has determined not to request such information and that
it is aware that the transferor is relying upon its foregoing
representations in order to claim the exemption from registration
provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member, and the
Securities to be transferred consist of Physical Securities which
after transfer are to be evidenced by an interest in a Global
Security, upon receipt by the Registrar of written instructions given
in accordance with the Depository's and the Registrar's procedures,
the Registrar shall reflect on its books and records the date and an
increase in the principal amount of such Global Security in an amount
equal to the principal amount of the Physical Securities to be
transferred, and the Trustee shall cancel the Physical Securities so
transferred; and
(iii) if the proposed transferor is an Agent Member seeking to
transfer an interest in the IAI Global Security or the Regulation S
Global Security, upon receipt by the Registrar of written instructions
given in accordance with the Depository's and the Registrar's
procedures, the Registrar shall register the transfer and reflect on
its books and records the date and (A) a decrease in the principal
amount of the IAI Global Security or the Regulation S Global Security,
as the case may be, in an amount equal to the principal amount of the
Securities to be transferred and (B) an increase in the principal
amount of the Global Security in an amount equal to the principal
amount of the Securities to be transferred.
(c) Restrictions on Transfer and Exchange of Global Securities.
Notwithstanding any other provisions of this Indenture, a Global Security
may not be transferred as a whole except by the Depository to a nominee of
the Depository or by a nominee of the Depository to the Depository or any
such nominee to a successor Depository or a nominee of such successor
Depository.
(d) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar shall deliver Securities that do not bear the Private Placement
Legend. Upon the transfer, exchange or replacement of Securities bearing
the Private Placement Legend, the Registrar shall deliver only Securities
that bear the Private Placement Legend unless (i) the requested transfer is
after the second anniversary of the Issue Date (provided, however, that, to
the knowledge of the Trustee, neither the Company nor any Affiliate of the
Company has held any beneficial interest in such Security, or portion
thereof, at any time prior to or on the second anniversary of the Issue
Date), or (ii) there is delivered to the Registrar an Opinion of Counsel
reasonably satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are required
in order to maintain compliance with the provisions of the Securities Act.
(e) General. By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such a Security acknowledges the
restrictions on transfer of such Note 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 Registrar shall retain copies of all letters, notices and other written
communications received pursuant to Section 2.16 or this Section 2.17. The
Company shall have the right to inspect and make copies of all such letters,
28
notices or other written communications at any reasonable time during the
Registrar's normal business hours upon the giving of reasonable written notice
to the Registrar.
(f) Transfers of Securities Held by Affiliates. Any certificate (i)
evidencing a Security that has been transferred to an Affiliate of the
Company within two (2) years after the Issue Date, as evidenced by a
notation on the Assignment Form for such transfer or in the representation
letter delivered in respect thereof or (ii) evidencing a Security that has
been acquired from an Affiliate (other than by an Affiliate) in a
transaction or a chain of transactions not involving any public offering,
shall, until two (2) years after the last date on which the Company or any
Affiliate of the Company was an owner of such Security, in each case, bear
the Private Placement Legend, unless otherwise agreed by the Company (with
written notice thereof to the Trustee).
ARTICLE III.
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company elects to redeem Securities pursuant to paragraph 5 of the
Securities, it shall notify the Trustee and the Paying Agent in writing of the
Redemption Date, the Redemption Price and the principal amount of the Securities
to be redeemed and whether it wants the Trustee to give notice of redemption to
the Holders (at the Company's expense) at least forty-five (45) days (unless a
shorter notice shall be satisfactory to the Trustee) but not more than sixty
(60) days before the Redemption Date, together with an Officers' Certificate
stating that such redemption will comply with the conditions contained herein
and in the Securities. Any such notice may be canceled at any time prior to
notice of such redemption being mailed to any Holder and shall thereby be void
and of no effect. Notwithstanding anything set forth in this Article III, the
Company shall at all times comply with Article X hereof.
SECTION 3.02. Selection of Securities To Be Redeemed.
If less than all of the Securities are to be redeemed, the Trustee shall
select the Securities to be redeemed pro rata in proportion to the relative
number of Securities of each Holder. The Trustee shall make the selection not
more than sixty (60) days and not less than thirty (30) days before the
Redemption Date from the Securities outstanding and not previously called for
redemption. The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Security selected for
partial redemption, the principal amount thereof to be redeemed. Provisions of
this Indenture that apply to Securities called for redemption also apply to
portions of Securities called for redemption.
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SECTION 3.03. Notice of Redemption.
At least thirty (30) days but not more than sixty (60) days before a
Redemption Date, the Company shall mail a notice of redemption by first class
mail to each Holder whose Securities are to be redeemed at the address of such
Holder appearing in the Security register maintained by the Registrar. At the
Company's request, the Trustee shall give the notice of redemption in the
Company's name and at the Company's expense. Each notice of redemption shall
identify the Securities to be redeemed and shall state:
(i) the Redemption Date;
(ii) the Redemption Price and the amount of accrued interest, if
any, to be paid;
(iii) the name and address of the Paying Agent;
(iv) that Securities called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price and accrued interest,
if any;
(v) that, unless the Company defaults in making the redemption
payment or such redemption payment is prevented for any reason,
interest on Securities called for redemption ceases to accrue on and
after the Redemption Date, and the only remaining right of the Holders
of such Securities is to receive payment of the Redemption Price upon
surrender to the Paying Agent of the Securities redeemed;
(vi) if fewer than all the Securities are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Securities to
be redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption;
(vii) if any Security is being redeemed in part, the portion of
the principal amount of such Security to be redeemed and that, after
the Redemption Date, and upon surrender of such Security, a new
Security or Securities in the aggregate principal amount equal to the
unredeemed portion thereof will be issued without charge to the
Security holder;
(viii) the CUSIP number, if any, relating to such Securities
pursuant to Section 2.14 hereof; and
(ix) that the notice is being sent pursuant to this Section 3.03
and pursuant to the optional redemption provisions of the Securities.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price. Upon surrender to the Trustee or Paying Agent, such
Securities called for redemption shall be paid at the Redemption Price plus
accrued and unpaid interest, if any, to the Redemption Date, but interest
installments whose maturity is on or prior to such Redemption Date will be
payable on the relevant Interest Payment Dates to the Holders of record at the
close of business on the relevant Record Dates referred to in the Securities.
30
Notice of redemption shall be deemed to be given when mailed to each Holder
in the manner herein provided whether or not the Holder receives such Notice. In
any event, failure to give such notice, or any defect therein, shall not affect
the validity of the proceedings for the redemption of any other Security.
SECTION 3.05. Deposit of Redemption Price.
On or prior to each Redemption Date, the Company shall deposit with the
Paying Agent U.S. Legal Tender sufficient to pay the Redemption Price of all
Securities to be redeemed on that date. Upon the written request of the Company,
the Paying Agent shall promptly return to the Company any U.S. Legal Tender so
deposited which is not required for that purpose except with respect to monies
owed as obligations to the Trustee pursuant to Article VII.
If the Company complies with the preceding paragraph, interest on the
Securities to be redeemed will cease to accrue on the applicable Redemption
Date, whether or not such Securities are presented for payment. If any Security
called for redemption shall not be so paid upon surrender for redemption,
interest will be paid, from the Redemption Date until such Redemption Price is
paid, on the unpaid Principal of and on any interest not paid on such unpaid
Principal, in each case, at the rate provided in the Securities.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is to be redeemed in part, the Company
shall issue and the Trustee shall authenticate for the Holder, at the expense of
the Company, a new Security or Securities equal in principal amount to the
unredeemed portion of the Security surrendered.
ARTICLE IV.
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the Principal of and interest on the Securities on
the dates and in the manner provided in the Securities and this Indenture. An
installment of Principal of or interest on the Securities shall be considered
paid on the date it is due if the Trustee or Paying Agent holds on that date
U.S. Legal Tender designated for and sufficient to pay the installment and/or
interest then due and is not prohibited from paying such installment on such
date.
The Company shall pay interest on (i) overdue Principal at the rate set
forth in the second paragraph of paragraph 1 of the Securities, and (ii) overdue
installments of interest at the same rate, to the extent lawful.
SECTION 4.02. Maintenance of Office or Agency.
The Company shall maintain in the Borough of Manhattan, The City of New
York, the office or agency required under Section 2.03. The Company shall give
prior notice to the Trustee of the location, and any change in the location, of
such office or agency. If at any time the Company shall fail to maintain any
31
such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands described
in such Section 2.03 may be made or served at the address of the Trustee set
forth in Section 2.03.
The Company may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, The City of New York, for such purposes. The Company shall give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency. The Company
hereby initially designates the corporate trust office of the Trustee set forth
in Section 2.03 as such office.
SECTION 4.03. Corporate Existence.
Except as otherwise permitted by Article V, the Company shall do or cause
to be done all things necessary to preserve and keep in full force and effect
its existence and the existence of each of its Subsidiaries, in accordance with
the respective organizational documents of each of them and the rights (charter
and statutory) and franchises of the Company and its Subsidiaries; provided,
however, that the Company shall not be required to preserve, with respect to
itself, any right or franchise, and with respect to any of its Subsidiaries, any
such existence, right or franchise, if (a) the Board of Directors of the Company
shall determine reasonably and in good faith that the preservation thereof is no
longer desirable in the conduct of the business of the Company and (b) the loss
thereof is not adverse in any material respect to the Holders.
SECTION 4.04. Payment of Taxes and Other Claims.
The Company shall and shall cause each of its Subsidiaries to, pay or
discharge or cause to be paid or discharged, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges (including
withholding taxes and any penalties, interest and additions to taxes) levied or
imposed upon it or any of its Subsidiaries or properties of it or any of its
Subsidiaries, and (ii) all lawful claims for labor, materials and supplies that,
if unpaid, might by law become a Lien upon the property of it or any of its
Subsidiaries; provided, however, that the Company shall not be required to pay
or discharge or cause to be paid or discharged any such tax, assessment, charge
or claim if either (a) the amount, applicability or validity thereof is being
contested in good faith by appropriate proceedings and an adequate reserve has
been established therefor to the extent required by GAAP, or (b) the failure to
make such payment or effect such discharge (together with all other such
failures) would not have a material adverse effect on the financial condition or
results of operations of the Company and its Subsidiaries, taken as a whole.
SECTION 4.05. Maintenance of Properties and Insurance.
(a) The Company shall cause all Properties used or useful in the
conduct of its business or the business of any of its Subsidiaries to be
maintained and kept in satisfactory condition, repair and working order and
supplied with all necessary equipment and shall cause to be made all
necessary repairs, renewals, replacements, betterments and improvements
32
thereof, all as in its judgment may be necessary, so that the business
carried on in connection therewith may be properly and advantageously
conducted at all times unless the failure to so maintain such properties
(together with all other such failures) would not have a material adverse
effect on the financial condition or results of operations of the Company
and its Subsidiaries taken as a whole; provided, however, that nothing in
this Section 4.05 shall prevent the Company or any of its Subsidiary from
discontinuing the operation or maintenance of any of such properties or
disposing of any of them if such discontinuance or disposal is either (i)
in the ordinary course of business, (ii) in the good faith judgment of the
Board of Directors of the Company or the Subsidiary concerned, or of the
senior officers of the Company or such Subsidiary, as the case may be,
desirable in the conduct of the business of the Company or such Subsidiary,
as the case may be, or (iii) is otherwise permitted by this Indenture.
(b) The Company shall provide or cause to be provided, for itself and
each of its Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds that, in the reasonable, good faith
opinion of the Company are adequate and appropriate for the conduct of the
business of the Company and such Subsidiaries in a prudent manner, with
reputable insurers or with the government of the United States of America
or an agency or instrumentality thereof, in such amounts, with such
deductibles, and by such methods as shall be customary, in the reasonable,
good faith opinion of the Company, for companies similarly situated in the
industry, unless the failure to provide such insurance (together with all
other such failures) would not have a material adverse effect on the
financial condition or results of operations of the Company and its
Subsidiaries, taken as a whole.
(c) The Company shall and shall cause each of its Subsidiaries to keep
proper books of record and account, in which full and correct entries shall
be made of all financial transactions and the assets and business of the
Company and each Subsidiary in accordance with GAAP consistently applied to
the Company and its Subsidiaries taken as a whole.
SECTION 4.06. Compliance Certificates; Notice of Default.
(a) The Company shall deliver to the Trustee, within sixty (60) days
after the end of each of the Company's first three fiscal quarters and
within ninety (90) days after the end of the Company's fiscal year, an
Officers' Certificate stating that a review of the Company's activities and
the activities of its Subsidiaries during the preceding fiscal period has
been made under the supervision of the signing Officers with a view to
determining whether it has kept, observed, performed and fulfilled its
obligations under this Indenture and further stating, as to each such
Officer signing such certificate, that to the best of his knowledge, the
Company during such preceding fiscal period has kept, observed, performed
and fulfilled each and every such covenant and no Default or Event of
Default occurred during such period and at the date of such certificate
there is no Default or Event of Default that has occurred and is continuing
or, if such signers do know of such Default or Event of Default, the
certificate shall describe the Default or Event of Default and its status
with particularity and what action the Company has taken or proposes to
take with respect thereto. The Officers' Certificate shall also include all
calculations necessary to show covenant compliance. The Officers'
Certificate shall also notify the Trustee should the Company elect to
change the manner in which it fixes its fiscal year end.
33
(b) So long as (and to the extent) not contrary to the then current
recommendations of the American Institute of Certified Public Accountants,
the Company shall deliver to the Trustee within ninety (90) days after the
end of each fiscal year a written statement by a nationally recognized firm
of independent public accountants stating (A) that their audit examination
has included a review of the terms of this Indenture and the Securities as
they relate to accounting matters, and (B) whether, in connection with
their audit examination, any Default or Event of Default has come to their
attention and if such a Default or Event of Default has come to their
attention, specifying the nature and period of existence thereof.
(c) The Company will deliver to the Trustee promptly, and in any event
within ten (10) days after the Company becomes aware or should reasonably
have become aware of the occurrence of any Default or Event of Default, an
Officers' Certificate describing such Default or Event of Default and its
status with particularity and what action the Company is taking or proposes
to take with respect thereto.
SECTION 4.07. Compliance with Laws.
The Company shall comply, and shall cause each of its Subsidiaries to
comply, with the respective organizational documents of each of them and all
applicable statutes, rules, regulations, orders and restrictions of the United
States of America, all states, provinces and municipalities thereof, and of any
governmental department, commission, board, regulatory authority, bureau, agency
and instrumentality of the foregoing, in respect of the conduct of their
respective businesses and the ownership of their respective properties, except
such the noncompliance with which would not in the aggregate have a material
adverse effect on the financial condition or results of operations of the
Company and its Subsidiaries taken as a whole.
SECTION 4.08. Financial Reports, Etc.
(a) As soon as practical and in any event within 90 days after the end
of each Fiscal Year of the Company, deliver or cause to be delivered to the
Trustee and each Holder (i) audited consolidated and unaudited,
Company-prepared consolidating balance sheets of the Company and its
Subsidiaries as at the end of such Fiscal Year, and the notes thereto (with
respect to audited statements only), and the related audited consolidated
and unaudited, Company-prepared consolidating statements of income and
stockholders' equity and related consolidated statements of cash flows, and
the respective notes thereto (with respect to audited statements only), for
such Fiscal Year, setting forth (other than for consolidating statements)
comparative financial statements for the preceding Fiscal Year, all
prepared in accordance with GAAP with such changes from prior periods as
required by GAAP and noted in the auditor's opinion delivered therewith and
containing, with respect to the consolidated financial statements, opinions
of Ernst & Young, or other such "Big 5" independent certified public
accountants, which are unqualified as to the scope of the audit performed
and as to the "going concern" status of the Company and without any
exception not acceptable to the Holders (other than a qualification
regarding the impending maturing of the Indebtedness due under the Credit
Agreement in effect as of the date hereof, it being agreed such a
qualification shall not by itself prevent a financial statement from
satisfying the requirements of this subsection (a)), provided, however,
that such financial statements and related deliveries for Fiscal Year 2001
34
may be delivered on or before April 30, 2001, and (ii) a certificate of an
Authorized Representative, which shall be in the form of Exhibit D,
demonstrating compliance with Section 4.24;
(b) as soon as practical and in any event within 45 days after the end
of each Fiscal Quarter (except the last Fiscal Quarter of the Fiscal Year)
deliver to the Trustee and each Holder (i) consolidated and consolidating
balance sheets of the Company and its Subsidiaries as at the end of such
Fiscal Quarter, and the related consolidated and consolidating statements
of income and stockholders' equity and related consolidated statement of
cash flows for such Fiscal Quarter in each case setting forth in
comparative form consolidated figures for the corresponding period of the
preceding Fiscal Year and accompanied by a certificate of an Authorized
Representative to the effect that such financial statements present fairly
the financial position of the Company and its Subsidiaries as of the end of
such fiscal period and the results of their operations and the changes in
their financial position for such fiscal period, in conformity with the
standards set forth in GAAP with respect to interim financial statements,
and (ii) a certificate of an Authorized Representative containing
computations for such Fiscal Quarter comparable to that required pursuant
to Section 4.08(a)(ii);
(c) together with each delivery of the financial statements required
by Section 4.08(a)(i), deliver to the Trustee and each Holder a letter from
the Company's accountants specified in Section 4.08(a)(i) stating that in
performing the audit necessary to render an opinion on the financial
statements delivered under Section 4.08(a)(i), they obtained no knowledge
of any Default or Event of Default by the Company in the fulfillment of the
terms and provisions of this Indenture insofar as they relate to financial
matters (which at the date of such statement remains uncured); or if the
accountants have obtained knowledge of such Default or Event of Default, a
statement specifying the nature and period of existence thereof; and
(d) promptly upon their becoming available to the Company, the Company
shall deliver to the Trustee and each Holder a copy of (i) all regular or
special reports or effective registration statements which the Company or
any Subsidiary shall file with the Securities and Exchange Commission (or
any successor thereto) or any securities exchange, (ii) any proxy statement
distributed by the Company or any Subsidiary to its shareholders,
bondholders or the financial community in general, and (iii) any management
letter or other report submitted to the Company or any Subsidiary by
independent accountants in connection with any annual, interim or special
audit of the Company or any Subsidiary except for agreed upon procedures
reports for compliance under third-party agreements, reports on employee
benefit plan financial statements and reports with respect to tax advisory
matters.
The Trustee and the Holders are hereby authorized to deliver a copy of any
such financial or other information delivered hereunder to any Affiliate of any
Holder, to any Governmental Authority having jurisdiction over the Trustee or
any of the Holders pursuant to any written request therefor or in the ordinary
course of examination of loan files, to any other Person who shall acquire or
consider the assignment of, or acquisition of any participation interest in, any
Obligation permitted by this Indenture.
35
SECTION 4.09. SEC Reports and Other Information.
(a) To the extent permitted by applicable law or regulation, whether
or not the Company is subject to Section 13(a) or 15(d) of the Exchange
Act, the Company shall file with the SEC the annual reports, quarterly
reports and other documents which the Company would have been required to
file with the SEC pursuant to such Sections 13(a) and 15(d) if the Company
were so subject, such documents to be filed with the SEC on or prior to the
respective dates (the "Required Filing Dates") by which the Company would
have been required so to file such documents if the Company were so
subject. The Company shall comply with its reporting and filing obligations
under the applicable federal securities laws. The Company shall also in any
event (x) within fifteen (15) days after each Required Filing Date (i)
transmit by mail to all Holders, as their names and addresses appear in the
register of Securities maintained by the Registrar, without cost to such
Holders and (ii) file with the Trustee, copies of the annual reports,
quarterly reports and other documents which the Company would have been
required to file with the SEC pursuant to Sections 13(a) and 15(d) of the
Exchange Act if the Company were subject to such Sections and (y) if filing
such documents by the Company with the SEC is not permitted under the
Exchange Act, promptly upon written request supply copies of such documents
to any prospective Holder. In any event, such annual reports will contain
consolidated financial statements and notes thereto, together with an
opinion thereon expressed by an independent public accounting firm with an
established national reputation and management's discussion and analysis of
financial condition and results of operations, and such quarterly reports
will contain unaudited condensed consolidated financial statements for the
first three quarters of each fiscal year. Upon qualification of this
Indenture under the TIA, the Company shall also comply with the provisions
of TIA ss.314(a).
(b) At any time when the Company is not subject to Section 13 or 15(d)
of the Exchange Act, upon the request of a Holder, 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
Security designated by such Holder, as the case may be, in order to permit
compliance by such Holder with Rule 144A under the Securities Act.
(c) The Company shall, at all times following the 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.
(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
36
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.
SECTION 4.10. Waiver of Stay Extension or Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury law or
other law that would prohibit or forgive the Company from paying all or any
portion of the Principal of or interest on the Securities as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Indenture; and (to the extent
that it may lawfully do so) the Company hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.
SECTION 4.11. Limitation on Indebtedness.
The Company shall not, and shall not cause or permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume, issue, guarantee
or in any manner become liable for or with respect to the payment of, any
Attributable Indebtedness or Indebtedness (including any Acquired Indebtedness),
except that the Company and its Subsidiaries may incur (each of which shall be
given independent effect):
(a) Indebtedness of the Company evidenced by the Securities or
otherwise arising under this Indenture;
(b) Indebtedness of the Company and its Subsidiaries outstanding from
time to time pursuant to the Credit Agreement not to exceed at any one time
$73,687,000 in the aggregate, minus the amount of Indebtedness pursuant to
the Credit Agreement repaid after the Effective Date with the Net Cash
Proceeds from an Asset Sale pursuant to Section 4.18;
(c) Indebtedness of the Company and its Subsidiaries outstanding on
the Effective Date; provided, none of the instruments and agreements
evidencing or governing such Indebtedness shall be amended, modified or
supplemented after the Issue Date to change any terms of subordination,
payment of Principal, interest, fees or other amounts due, or rights of
conversion, put, exchange or other similar rights or any other covenants,
terms or conditions thereof to be less favorable to the Holders than such
terms, rights and conditions as is effect on the Effective Date.
(d) purchase money Indebtedness of the Company described in Section
4.14(d) not to exceed an aggregate outstanding amount at any time of
$500,000;
(e) Indebtedness of the Company, in an aggregate principal amount not
to exceed $2,000,000 if, (x) immediately after giving pro forma effect to
the incurrence thereof, no Default or Event of Default shall have occurred
and (y) all such Indebtedness is subordinated, on terms acceptable to the
Holders, to all Indebtedness due under the Securities;
37
(f) Indebtedness of a Subsidiary of the Company issued to and held by
the Company or a Wholly-Owned Subsidiary of the Company; provided, however,
that any transfer of such Indebtedness (other than to the Company or a
Wholly-Owned Subsidiary of the Company) shall be deemed, in such case, to
constitute a new incurrence of such Indebtedness by the issuer thereof;
(g) Indebtedness of the Company owed to or held by a Wholly-Owned
Subsidiary of the Company that is unsecured and subordinated in right of
payment to the Securities; provided, however, that any subsequent issuance
or transfer of any Capital Stock which results in any such other
Wholly-Owned Subsidiary ceasing to be a Wholly-Owned Subsidiary of the
Company, or any transfer of such Indebtedness (other than to a Wholly-Owned
Subsidiary of the Company), shall be deemed in each case to constitute a
new incurrence of such Indebtedness by the Company;
(h) Indebtedness represented by Hedging Obligations of the Company or
its Subsidiaries with respect to Indebtedness of the Company or its
Subsidiaries (which Indebtedness is otherwise permitted to be incurred
under this Section 4.11 and which Hedging Obligations are otherwise
permitted to be incurred under Section 4.25) to the extent the notional
principal amount of such Hedging Obligations does not exceed the principal
amount of the Indebtedness to which such Hedging Obligations relate;
(i) any replacements, renewals, refinancings and extensions of
Indebtedness incurred under clauses (a), (b), (c), (d), (e), (f) and (g)
above provided that (i) any such replacement, renewal, refinancing and
extension (x) shall not provide for any mandatory redemption, amortization
or sinking fund requirement in an amount greater than or at a time prior to
the amounts and times specified in the Indebtedness being replaced,
renewed, refinanced or extended and (y) shall be contractually subordinated
to the Securities at least to the extent, if at all, that the Indebtedness
being replaced, renewed, refinanced or extended is subordinate to the
Securities, (ii) any such Indebtedness of any person must be replaced,
refinanced or extended with Indebtedness incurred by such person or by the
Company, (iii) the principal amount of Indebtedness incurred pursuant to
this clause (i) (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) shall not exceed the sum of the principal amount (or with
respect to Indebtedness which 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 accreted value thereof) of
Indebtedness so replaced, renewed, refinanced or extended, plus accrued
interest, the amount of any premium required to be paid in connection with
such replacement, renewal, refinancing or extension pursuant to the terms
of such Indebtedness or the amount of any premium reasonably determined by
the Company as necessary to accomplish such replacement, renewal,
refinancing or extension by means of a tender offer or privately negotiated
purchase and the amount of fees and expenses incurred in connection
therewith, (iv) the covenants, terms and conditions of any such extension,
renewal, refunding or refinancing Indebtedness (and of any agreement or
instrument entered into in connection therewith) are no less favorable to
38
the Holders than the terms of the Indebtedness as in effect prior to such
action, and (v) immediately prior to and immediately after giving effect to
any such extension, renewal, refunding or refinancing, no Default or Event
of Default shall have occurred and be continuing; and
(j) the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business.
SECTION 4.12. Limitation on Restricted Payments.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, make any Restricted Payment, unless at the time of and
after giving effect to such Restricted Payment:
(a) no Default or Event of Default shall have occurred and be
continuing or occur as a consequence thereof;
(b) the Company could incur at least $1.00 of Indebtedness pursuant to
clause (e) of Section 4.11 hereof; and
(c) the aggregate of all Restricted Payments declared or made after
the Issue Date through and including the date of such Restricted Payment
does not exceed 50% of the Company's Consolidated Net Income (or in the
event such Consolidated Net Income shall be a deficit, minus 100% of such
deficit) from and including April 1, 1998 to and including the last day of
the fiscal quarter immediately preceding the date of such Restricted
Payment.
The provisions of this Section 4.12 shall not prohibit (i) the payment of
any dividend within sixty (60) days after the date of declaration thereof, if
such payment would comply with the provisions of this Indenture at the date of
the declaration of such payment, (ii) the retirement of any shares of Capital
Stock of the Company or Indebtedness of the Company which is subordinated in
right of payment to the Securities by conversion into, or by an exchange for,
shares of Capital Stock of the Company that are not Disqualified Stock or out of
the Net Proceeds of the substantially concurrent sale (other than to a
Subsidiary of the Company) of other shares of Capital Stock (other than
Disqualified Stock) of the Company, and (iii) the redemption or retirement of
Indebtedness of the Company which is subordinated in right of payment to the
Securities in exchange for, by conversion into, or out of the Net Proceeds of, a
substantially concurrent sale of subordinated Indebtedness of the Company (other
than to a Subsidiary of the Company) that is contractually subordinated in right
of payment to the Securities at least to the same extent that the Indebtedness
being redeemed or retired is subordinated to the Securities.
In determining the amount of Restricted Payments permissible under clause
(c) above, amounts expended pursuant to clauses (i) and (ii) above shall be
included as Restricted Payments.
Not later than the date of making any Restricted Payment (other than the
dividend payments on the Mezzanine Preferred Stock), the Company shall deliver
to the Trustee an Officers' Certificate stating that such Restricted Payment is
39
permitted and setting forth the basis upon which the calculations required by
this Section 4.12 were computed, which calculations may be based upon the
Company's latest available financial statements.
So long as no Default or Event of Default shall have occurred and be
continuing, or occur as a consequence thereof, the provisions of this Section
4.12 shall not prohibit the declaration or payment of the dividends payable on
the Mezzanine Preferred Sock as set forth in the Certificate of Designations.
SECTION 4.13. Limitation on Dividends and Other Payment Restrictions
Affecting Subsidiaries.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist or become
effective or enter into any agreement with any person that would cause any
consensual encumbrance or restriction of any kind on the ability of any
Subsidiary of the Company to (a) pay dividends, in cash or otherwise, or make
any other distributions on its Capital Stock or any other interest or
participation in, or measured by, its profits owned by, or pay any Indebtedness
owed to, the Company or any of its Subsidiaries, (b) make loans or advances to
the Company or any of its Subsidiaries or (c) transfer any of its Properties to
the Company or any of its Subsidiaries, except, in each case, for such
encumbrances or restrictions existing under or contemplated by or by reason of
(i) any restrictions existing under the Credit Agreement as in effect on the
Effective Date, (ii) any restrictions existing under any agreement that
refinances, replaces, amends or extends an agreement containing a restriction
permitted by clause (i) above; provided that the terms and conditions of any
such restrictions are not materially less favorable to the holders of the
Securities than those under or pursuant to the agreement being refinanced,
replaced, amended or extended or (iii) customary non-assignment or sublease
provisions of any agreement of the Company or its Subsidiaries.
SECTION 4.14. Limitation on Liens.
Other than Permitted Liens, the Company shall not, and the Company shall
not permit, cause or suffer any of its Subsidiaries to, create, incur, assume or
suffer to exist any Lien, charge or other encumbrance of any kind with respect
to any property or assets now owned or hereafter acquired by it, which (a)
secures Indebtedness of the Company subordinated in right of payment to the
Securities, unless the Securities are secured by a Lien on such property that is
senior to such Lien, (b) secures Indebtedness of the Company which is pari passu
in right of payment with the Securities, unless the Securities are secured by a
Lien on such Property that is equal and ratable with such Lien, (c) secures
Indebtedness incurred to refinance Indebtedness which has been secured by a Lien
permitted under this Indenture and is permitted to be refinanced under this
Indenture, to the extent such Liens extend to or cover Property of the Company
or any of its Subsidiaries not securing the Indebtedness so refinanced or
increase the extent of such Liens, or (d) purchase money Liens to secure
Indebtedness permitted under this Indenture (or as extended or renewed as
permitted under this Indenture) and incurred to purchase fixed assets, unless
such Indebtedness represents not less than seventy-five percent (75%) and not
more than one hundred percent (100%) of the purchase price of such assets as of
the date of purchase thereof and no Property other than the assets so purchased
secures such Indebtedness.
40
Notwithstanding the foregoing, Liens shall be permitted by the previous
clauses (a) and (b) only to the extent that any Indebtedness secured by such
Liens is incurred pursuant to and in accordance with this Indenture.
SECTION 4.15. Limitation on Investments, Loans and Advances.
The Company shall not make, and shall not permit any of its Subsidiaries to
make, any Investment, except: (i) Investments by the Company or any of its
Subsidiaries in any Wholly-Owned Subsidiary of the Company that is a Guarantor
(including any such Investment pursuant to which a Person becomes a Wholly-Owned
Subsidiary of the Company) or in the Company by any of its Subsidiaries; (ii)
Investments represented by receivables created or acquired in the ordinary
course of business or the settlement of such receivables in the ordinary course
of business; (iii) Investments permitted to be made pursuant to Section 4.12;
(iv) Investments represented by advances to employees, officers and directors of
the Company or its Subsidiaries made in the ordinary course of business and
consistent with reasonable and customary business practices; (v) Permitted
Investments; (vi) Investments permitted to be made with the Net Cash Proceeds of
Asset Sales pursuant to Section 4.18; (vii) Investments existing on the Issue
Date which are set forth on Schedule 5.36 to the Securities Purchase Agreement;
(viii) Investments in Hedging Obligations permitted under Section 4.25; (ix)
Investments represented by loans or advances after the Effective Date to
Subsidiaries which are not Guarantors provided that (y) the aggregate
outstanding principal amount of such Investments shall not at any time exceed
$500,000 and (z) the repayment of such Investments is subordinated to the rights
of the Holders under this Indenture and the Guaranty Agreements; and (x)
Investments permitted to be made pursuant to Section 4.11(e) and Section
4.11(f).
SECTION 4.16. Limitation on Transactions with Affiliates.
The Company will not, and will not permit, cause or suffer, any of its
Subsidiaries to, participate in an Affiliate Transaction, except in good faith
and on terms that are no less favorable to the Company or such Subsidiary, as
the case may be, than those that could have been obtained in a comparable
transaction on an arm's length basis from a person not an Affiliate of the
Company or such Subsidiary. With respect to any Affiliate Transaction (and each
series of related Affiliate Transactions which are similar or part of a common
plan) involving aggregate payments or other market value in excess of
$1,000,000, the Company shall deliver an Officers' Certificate to the Trustee
certifying that such Affiliate Transaction (or series of related Affiliate
Transactions) complies with the foregoing provisions and that such Affiliate
Transaction (or series of related Affiliate Transactions) was approved by a
majority of the Independent Directors of the Company and the Board of Directors
of the Company as a whole. Notwithstanding the foregoing, the restrictions set
forth in this Section 4.15 shall not apply to (i) any employment agreement,
consulting agreement and indemnification obligations entered into by the Company
or any of its Subsidiaries in the ordinary course of business and consistent
with the past practice of the Company or such Subsidiary, (ii) the payment of
reasonable and customary fees to directors of the Company who are not employees
of the Company, and (iv) transactions permitted under Sections 4.11, 4.12 and
4.15 hereof.
41
SECTION 4.17. Change of Control.
(a) Upon the occurrence of a Change of Control (the date of such
occurrence being the "Change of Control Date"), the Company shall notify or
cause to be notified the Holders in writing of such occurrence and shall
make an offer to purchase (the "Change of Control Offer"), on a Business
Day (the "Change of Control Payment Date") not later than sixty (60) days
following the Change of Control Date, all Securities then outstanding at
the Redemption Price plus accrued and unpaid interest, if any, to the
Change of Control Payment Date. The Change of Control Offer shall remain
open for at least twenty (20) Business Days and until 5:00 p.m., New York
City time, on the Business Day next preceding the Change of Control Payment
Date. Within ten (10) days after the Change of Control Date requiring the
Company to make a Change of Control Offer pursuant to this Section 4.17,
the Company shall so notify the Trustee. Such notice shall be accompanied
by an Officers' Certificate setting forth the circumstances and relevant
facts regarding such Change of Control. In connection with such
notification to the Trustee, the Company may instruct the Trustee to give,
at the cost and expense of the Company, the notice required to be given by
clause (b) below.
(b) Notice of a Change of Control Offer shall be sent, by first class
mail, to each Holder not less than twenty-five (25) days nor more than
forty-five (45) days before the Change of Control Payment Date, with copies
to the Trustee, which notice shall, consistent with the provisions of this
Section 4.17, govern the terms of the Change of Control Offer. Such notice
shall contain all instructions and materials necessary to enable such
Holders to tender Securities pursuant to the Change of Control Offer and
shall state:
(i) that the Change of Control Offer is being made pursuant to
this Section 4.17 and that all Securities properly tendered will be
accepted for payment;
(ii) the Redemption Price (including the amount of accrued
interest) and the Change of Control Payment Date;
(iii) that any Security not tendered will continue to accrue
interest in accordance with the terms thereof;
(iv) that, unless the Company defaults in making payment
therefor, any Security accepted for payment pursuant to the Change of
Control Offer shall cease to accrue interest after the Change of
Control Payment Date;
(v) that Holders electing to have a Security purchased pursuant
to a Change of Control Offer will be required to surrender the
Security, with the form entitled "Option of Holder to Elect Purchase"
on the last page of the Security completed, to the Paying Agent at the
address specified in the notice prior to 5:00 p.m., New York City
time, on the Business Day prior to the Change of Control Payment Date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than 5:00 p.m., New York City
time, on the Business Day prior to the Change of Control Payment Date,
a telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of the Securities the Holder
delivered for purchase, the Security certificate number (if any) and a
statement that such Holder is withdrawing its election to have such
Security purchased;
42
(vii) that Holders whose Securities are purchased only in part
will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered; and
(viii) the circumstances and relevant facts regarding such Change
of Control.
(c) On or before the Change of Control Payment Date, the Company shall
(i) accept for payment Securities or portions thereof tendered pursuant to
the Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal
Tender sufficient to pay the purchase price of all Securities so tendered,
and (iii) deliver to the Trustee Securities so accepted together with an
Officers' Certificate stating the Securities or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail to the
Holders of Securities so accepted payment in an amount equal to the
Redemption Price, and the Trustee shall promptly authenticate and mail to
such Holders new Securities equal in principal amount to any unpurchased
portion of the Securities surrendered. The Paying Agent shall, upon written
request, return to the Company any U.S. Legal Tender not required to fund
the payment for Securities accepted for payment by the Company. If any
Security called for redemption shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with this clause
(c), interest will be paid on the unpaid Redemption Price from the Change
of Control Payment Date until such Redemption Price is paid, at the rate
provided in the Securities. Any Securities not so accepted shall be
promptly mailed by the Company to the Holder thereof.
(d) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of securities
pursuant to a Change of Control Offer. To the extent that the provisions of
any securities laws or regulations conflict with the provisions of this
Section 4.17, the Company shall comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations
under this Section 4.17 by virtue thereof.
(e) The Company will, to the extent required to or permitted by
applicable Laws, publicly announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Payment
Date.
SECTION 4.18. Disposition of Proceeds of Asset Sales.
(a) The Company will not, and will not permit any of its Subsidiaries
to, make any Asset Sale unless (i) the Company or the applicable
Subsidiary, as the case may be, receives consideration at the time of such
Asset Sale at least equal to the Fair Market Value of the assets sold or
otherwise disposed of and (ii) at least eighty (85%) of the Net Proceeds
received by the Company or such Subsidiary, as the case may be, from such
Asset Sale shall be in the form of cash or Cash Equivalents (with
Indebtedness of the Company or its Subsidiaries assumed by the purchaser
being counted as cash for such purposes if the Company and its Subsidiaries
are permanently released from all liability therefor); provided, however,
that 100% of the Net Proceeds received by the Company or such Subsidiary,
as the case may be, in such Asset Sale from the sale or other disposition
of Capital Stock shall be in the form of cash or Cash Equivalents.
43
(b) The Company shall or shall cause its Subsidiaries to, within (i)
180 days of receipt of any Net Cash Proceeds (other than Net Equity
Proceeds) from an Asset Sale and (ii) within 90 days of the receipt of any
Net Equity Proceeds from an Asset Sale, apply such Net Cash Proceeds to
permanently prepay Indebtedness outstanding under the Credit Agreement and
effect a permanent reduction of the commitment available under such Credit
Agreement. To the extent such Net Cash Proceeds are not applied as provided
in the previous sentence, such Net Cash Proceeds shall constitute "Excess
Proceeds" subject to disposition as provided in clause (c) below.
(c) When the aggregate amount of unutilized Excess Proceeds equals or
exceeds $500,000, the Company shall make an offer to repurchase (the "Asset
Sale Offer") on the Asset Sale Payment Date an aggregate principal amount
of the Securities equal to such entire unutilized Excess Proceeds (and not
just the amount in excess of $500,000) at a price in cash equal to the
Redemption Price, plus accrued interest, if any, to the Asset Sale Payment
Date. The Company shall, subject to the provisions described herein, be
required to repurchase all Securities validly tendered into such Asset Sale
Offer and not withdrawn. Upon completion of such Asset Sale Offer, the
amount of Excess Proceeds shall be reset to zero and any unutilized Excess
Proceeds may be utilized by the Company for any purpose.
(d) The Company shall provide the Trustee with prompt notice of the
occurrence of an Asset Sale Offer. Such notice shall be accompanied by an
Officers' Certificate setting forth (i) a statement to the effect that the
Company or any of its Subsidiaries has made an Asset Sale and (ii) the
aggregate principal amount of Securities offered to be purchased and the
Redemption Price.
(e) Notice of an Asset Sale Offer shall be sent, by first class mail,
by the Company (or caused to be mailed by the Company), with a copy to the
Trustee, to all Holders of Securities not less than thirty (30) days nor
more than sixty (60) days before the Asset Sale Payment Date at their last
registered address. The Asset Sale Offer shall remain open from the time of
mailing for at least twenty (20) Business Days and until at least 5:00
p.m., New York City time, on the Business Day next preceding the Asset Sale
Payment Date. The notice to the Holders shall contain all instructions and
materials necessary to enable such Holders to tender Securities pursuant to
the Asset Sale Offer. At the Company's request, the Trustee shall give, at
the cost and expense of the Company, the notice required by this paragraph
(e). Such notice shall state:
(i) that the Asset Sale Offer is being made pursuant to this
Section 4.17;
(ii) the Redemption Price (including the amount of accrued
interest, if any) for each Security and the Asset Sale Payment Date;
(iii) that any Security not tendered or accepted for payment will
continue to accrue interest in accordance with the terms thereof;
44
(iv) that unless the Company defaults on making payment therefor,
any Security accepted for payment pursuant to the Asset Sale Offer
shall cease to accrue interest after the Asset Sale Payment Date;
(v) that Holders electing to have a Security purchased pursuant
to an Asset Sale Offer will be required to surrender the Security,
with the form entitled "Option of Holder to Elect Purchase" on the
last page of the Security completed, to the Paying Agent at the
address specified in the notice prior to 5:00 p.m., New York City
time, on the Business Day prior to the Asset Sale Payment Date;
(vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than 5:00 p.m., New York City
time, on the Business Day prior to the Asset Sale Payment Date, a
telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Securities the Holder
delivered for purchase, the Security certificate number (if any) and a
statement that such Holder is withdrawing his election to have such
Securities purchased;
(vii) that if Securities in a principal amount in excess of the
principal amount of the Securities to be acquired pursuant to the
Asset Sale Offer are tendered and not withdrawn pursuant to the Asset
Sale Offer, the Company shall purchase Securities on a pro rata basis
among the Securities tendered (with such adjustment as may be deemed
appropriate by the Company so that only Securities in denominations of
$1,000 or integral multiples of $1,000 shall be so acquired);
(viii) that Holders whose Securities are purchased only in part
will be issued new Securities in a principal amount equal to the
unpurchased portion of the Securities surrendered; and
(ix) the instructions that Holders must follow in order to tender
their Securities.
(f) On or before an Asset Sale Payment Date, the Company shall (i)
accept for payment, on a pro rata basis, the Securities or portions thereof
tendered pursuant to the Asset Sale Offer (subject to adjustment as
contemplated by paragraph (vii) above), (ii) deposit with the Paying Agent
U.S. Legal Tender sufficient to pay the purchase price of all Securities or
portions thereof so tendered, and (iii) deliver to the Paying Agent the
Securities so accepted together with an Officers' Certificate identifying
the Securities or portions thereof accepted for payment by the Company. The
Paying Agent shall promptly mail to Holders of Securities tendered to and
accepted for payment an amount equal to the purchase price, and the Trustee
shall promptly authenticate and mail to such Holders new Securities equal
in principal amount to any unpurchased portion of the Securities
surrendered. Any Securities not so accepted shall, upon written request, be
promptly mailed or delivered by the Company to the Holder thereof. The
Paying Agent shall return to the Company any U.S. Legal Tender not required
to fund the payment for Securities accepted for payment by the Company. The
Company will publicly announce the results of the Asset Sale Offer as
promptly as practicable following the Asset Sale Payment Date.
45
(g) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities
pursuant to an Asset Sale Offer. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Section
4.18, the Company shall comply with the applicable securities laws and
regulations and shall not be deemed to have breached its obligations under
this Section 4.18 by virtue thereof.
SECTION 4.19. Limitation on Issuances and Sales of Preferred Stock by
Subsidiaries.
The Company (i) will not permit any of its Subsidiaries to issue any
Preferred Stock (other than to the Company or to a Wholly-Owned Subsidiary of
the Company) and (ii) will not permit any person (other than the Company or a
Wholly-Owned Subsidiary of the Company) to own any Preferred Stock of any
Subsidiary of the Company.
SECTION 4.20. Limitation on Liquidations, Dissolutions, Mergers and
Consolidation.
The Company shall not, and shall not permit any of its Subsidiaries to,
directly or indirectly, enter into any merger, consolidation or amalgamation, or
liquidate, wind up or dissolve itself (or suffer any liquidation or
dissolution), or convey sell, lease, assign, transfer or otherwise dispose of,
all or substantially all of its property, business or assets, or make any
material change in its present method of conducting business, except, (i) any
Subsidiary of the Company may be merged or consolidated with or into the Company
(provided that the Company shall be the continuing or surviving corporation) or
with or into any one or more Wholly-Owned Subsidiaries of the Company (provided
that a Wholly-Owned Subsidiary of the Company shall be the continuing or
surviving corporation) and after giving effect to any of such transactions, no
Default or Event of Default shall exist; and (ii) any Wholly-Owned Subsidiary of
the Company may sell, lease, transfer or otherwise dispose of any or all of its
assets (upon voluntary liquidation or otherwise) to the Company or any of its
Wholly-Owned Subsidiaries.
SECTION 4.21. Net Worth.
The Company will not and will not permit any of its Subsidiaries to permit
Consolidated Net Worth to be less than (i) eighty percent (80%) of the
Consolidated Net Worth of the Company as of the Issue Date, plus the amount of
the Net Cash Proceeds from the sale of the Series F Preferred Stock issued
pursuant to the Securities Purchase Agreement, and (ii) as at the last day of
each succeeding Fiscal Quarter of the Company and until (but excluding) the last
day of the next following Fiscal Quarter of the Company, the sum of (A) the
amount of Consolidated Net Worth required to be maintained pursuant to this
Section 4.21 as at the end of the immediately preceding Fiscal Quarter, plus (B)
sixty-five percent (65%) of Consolidated Net Income (with no reduction for net
losses during any period) for the Fiscal Quarter of the Company ending on such
day (including within "Consolidated Net Income" certain items otherwise excluded
as provided for in the definition of "Consolidated Net Income", less cash
dividends paid with respect to the Mezzanine Preferred Stock), plus (C) one
hundred percent (100%) of the aggregate amount of all increases in the stated
46
capital and additional paid-in capital accounts of the Company resulting from
the issuance of Capital Stock of the Company; provided, however, in the event
that the Company makes purchases in open market transactions of its common stock
having an aggregate purchase price of at least $3,500,000 by March 31, 1999,
then in such event the Consolidated Net Worth permitted at the Closing Date
under (i) above shall be recalculated to be an amount equal to 68% of the
Consolidated Net Worth as of the Closing Date and corresponding adjustments
under (ii)(A) above shall be made accordingly.
SECTION 4.22. ERISA Compliance.
The Company will not and will not permit any of its Subsidiaries to,
directly or indirectly, (i) engage in a "prohibited transaction," as such term
is defined in Section 406 of ERISA or Section 4975 of the Internal Revenue Code,
with respect to any Plan or Multiemployer Plan or knowingly consent to any other
"party in interest" or any "disqualified person," as such terms are defined in
Section 3(14) of ERISA or Section 4975(e)(2) of the Internal Revenue Code,
respectively, engaging in any "prohibited transaction," with respect to any Plan
or Multiemployer Plan maintained by the Company or any of its Subsidiaries; (ii)
permit any Plan maintained by the Company or any of its Subsidiaries to incur
any "accumulated funding deficiency," as defined in Section 302 of ERISA or
Section 412 of the Internal Revenue Code, unless such incurrence shall have been
waived in advance by the Internal Revenue Services; (iii) terminate any Plan in
a manner which could result in the imposition of a Lien on any property of the
Company or any of its Subsidiaries pursuant to Section 4068 of ERISA; (iv)
breach, or knowingly permit any employee of officer or any trustee or
administrator of any Plan maintained by the Company or any of its Subsidiaries
to breach, any fiduciary responsibility imposed under Title I of ERISA with
respect to any Plan; (v) engage in any transaction which would result in the
incurrence of a liability under section 4069 of ERISA; or (vi) fail to make
contributions to a Plan or Multiemployer Plan which results in the imposition of
a Lien on any property of the Company or any of its Subsidiaries pursuant to
Section 302(f) of ERISA or Section 412(n) of the Internal Revenue Code.
SECTION 4.23. Limitation on Acquisitions.
The Company will not and will not permit any of its Subsidiaries to enter
into any agreement, contract, binding commitment or other arrangement providing
for any Acquisition, or take any action to solicit the tender of securities or
proxies in respect thereof in order to effect any Acquisition other than
Permitted Acquisitions.
SECTION 4.24. Certain Consolidated Ratios.
The Company will not and will not permit any of its Subsidiaries to:
(a) permit at any time the Consolidated Leverage Ratio as of the end
of each four-quarter period ending during the applicable period set forth
below, to be greater than that ratio set forth opposite each such period:
47
Consolidated Leverage Ratio
Period Must Not Be Greater Than
------ ------------------------
Issue Date through and including
September 30, 1999 3.75 to 1.00
October 1, 1999 through and including
September 30, 2001 3.5 to 1.00
October 1, 2001 and thereafter 3.0 to 1.00;
(b) permit the Consolidated Fixed Charge Ratio as of the end of each
four quarter period ending during the applicable period or on the
applicable date set forth below to be less than that ratio set forth
opposite each such period or date:
48
Consolidated Fixed Charge
Period Date Ratio Must Not be Less Than
----------- ---------------------------
September 30, 2000 through and including
June 30, 2001 1.00 to 1.00
September 30, 2001 1.05 to 1.00
December 31, 2001 1.15 to 1.00
March 31, 2002 and thereafter 1.35 to 1.00
; and
(c) permit at any time the Consolidated Interest Coverage Ratio to be
less than 3.0 to 1.00.
SECTION 4.25. Limitation on Hedging Obligations.
The Company will not and will not permit any of its Subsidiaries to incur
any Hedging Obligations or enter into any agreements, arrangements, devices or
instruments relating to Hedging Obligations, except for Hedging Obligations the
aggregate notional amount of which does not exceed, the aggregate at any time
the lower of (i) 45,000,000, and (ii) 60% of the aggregate outstanding principal
balance of loans under the Credit Agreement.
SECTION 4.26. Sale of Subsidiaries.
The Company will not sell, convey, transfer, assign or otherwise dispose of
any Subsidiary of the Company or any division, operating unit or other business
unit of the Company that, on a pro forma basis, constitutes more than 20% of the
pro forma Consolidated EBITDA of the Company.
SECTION 4.27. Conduct of Business.
The Company shall not, and shall not permit any of its Subsidiaries to,
engage in any business other than the business engaged in on the Effective Date.
SECTION 4.28. Additional Guarantors.
The Company shall cause each newly formed or acquired Domestic Subsidiary
to execute the Guaranty Agreement within fifteen (15) Business Days of the
formation or acquisition of such Subsidiary.
ARTICLE V.
SUCCESSOR CORPORATION
SECTION 5.01. Consolidation, Merger, Conveyance, Transfer or Lease.
49
The Company shall not consolidate with or merge with or into or sell,
assign, convey, lease, transfer or otherwise dispose of all or substantially all
of its properties and assets (determined on a consolidated basis for the Company
and its Subsidiaries, taken as a whole) to another Person or Persons, in a
single transaction or through a series of related transactions, or cause or
permit any of its Subsidiaries to do any of the foregoing, unless:
(a) the Company is the continuing Person, or the Person formed by or
surviving such consolidation or merger or the Person to which such sale,
assignment, conveyance, lease, transfer or other disposition is made (the
"surviving entity") is a corporation organized and validly existing under
the laws of the United States, any State thereof or the District of
Columbia;
(b) the surviving entity shall expressly assume, by a supplemental
indenture executed and delivered to the Trustee, in form and substance
reasonably satisfactory to the Trustee, all of the obligations of the
Company under the Securities and this Indenture;
(c) immediately before and immediately after giving effect to such
transaction, or series of transactions (including, without limitation, any
Indebtedness incurred or anticipated to be incurred in connection with or
in respect of such transaction or series of transactions), no Default or
Event of Default shall have occurred and be continuing;
(d) the Company or the surviving entity (in the case of a merger or
consolidation involving the Company or any sale, assignment, conveyance,
lease, transfer or other disposition of all or substantially all of the
Company's properties and assets) shall immediately after giving effect to
such transaction or series of transactions (including, without limitation,
any Indebtedness incurred or anticipated to be incurred in connection with
or in respect of such transaction or series of transactions) have a
Consolidated Net Worth equal to or greater than the Consolidated Net Worth
of the Company immediately prior to such transaction or series of
transactions;
(e) immediately after giving effect to such transaction or series of
transactions, the Company or the surviving entity (in the case of a merger
or consolidation involving the Company or any sale, assignment, conveyance,
lease, transfer or other disposition of all or substantially all of the
Company's assets) could incur $1.00 of Indebtedness pursuant to clause (e)
of Section 4.11 hereof;
(f) the Company or the surviving entity shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that (i) such consolidation, merger, sale, assignment, conveyance, lease,
transfer or other disposition, (ii) if a supplemental indenture is required
in connection with such transaction or series of transactions, such
supplemental indenture complies with this Section 5.01, and (iii) all
conditions precedent in this Indenture relating to the transaction or
series of transactions have been satisfied; and
(g) the Company has delivered to the Trustee an opinion or certificate
of a nationally recognized firm of independent public accountant complying
with the applicable provisions of TIA ss.314(c)(3) and setting forth the
computation of the Consolidated Net Worth (i) of the surviving entity as
provided in Section 5.01(d) and the ability of the Company or the surviving
50
entity to incur at least $1.00 in additional Indebtedness as provided in
Section 5.01(e), immediately following the transaction, and (ii) of the
Company, immediately preceding such transaction, in accordance with clause
(d) or (e) above, certifying to the accuracy thereof.
SECTION 5.02. Successor Entity Substituted.
Upon any consolidation, merger or any transfer of all or substantially all
of the assets of the Company in accordance with Section 5.01, the surviving
entity formed by such consolidation or into or with which the Company is merged
or to which such transfer is made shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under this Indenture with the
same effect as if such surviving entity had been named as the Company herein and
the Company shall be discharged from all obligations and covenants under the
Indenture and the Securities.
ARTICLE VI.
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs if:
(i) the Company defaults in the payment of interest on any
Security when the same becomes due and payable and continuance of any
such default for a period of thirty (30) days; or
(ii) the Company defaults in the payment of the Principal of or
premium on any Security as and when due and payable (including a
default in payment upon an offer to purchase required to be made by
this Indenture); or
(iii) the Company defaults in the performance, or breach, of any
material covenant, obligation or agreement in the Securities or this
Indenture (other than defaults specified in clause (i) or (ii) above),
and such default or breach continues for a period of thirty (30) days
after written notice to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least 30% in aggregate principal
amount of the outstanding Securities; or
(iv) the failure by the Company to observe or perform any
material covenant, obligation or agreement contained in the Securities
Purchase Agreement or the Registration Rights Agreement and such
failure continues for a period of thirty (30) days; or
(v) a Series G Stock Event of Default (as such term is defined in
the Certificate of Designations) has occurred and is continuing
(including, without limitation, the Company's failure to pay any
dividend or the failure to make any redemption payment that it is
obligated to make, whether or not such payment is legally permissible
or conflicts with any other agreement to which the Company or any of
its Subsidiaries is a party or by which any of its or their respective
Properties are bound); or
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(vi) any representation or warranty contained in the Financing
Documents or any writing furnished by the Company or any of its
Subsidiaries to any Holder, contains any untrue statement of a
material fact or omits to state a material fact necessary in order to
make the statements made, in the light of the circumstances under
which they were made, not misleading; or
(vii) failure by the Company or any of its Subsidiaries (a) to
make any payment when due with respect to any other Indebtedness under
one or more classes or issues of Indebtedness which one or more
classes or issues of Indebtedness are in an aggregate principal amount
of $1,000,000 or more and, with respect to Indebtedness under the
Credit Agreement, such failure results in acceleration of the maturity
thereof; or (b) to perform any term, covenant, condition, or provision
of one or more classes or issues of Indebtedness which one or more
classes or issues of Indebtedness are in an aggregate principal amount
of $1,000,000 or more, which failure, in the case of this clause (b),
results in an acceleration of the maturity thereof; or
(viii) one or more judgments, orders or decrees for the payment
of money in excess of $1,000,000, either individually or in an
aggregate amount, shall be entered against the Company or any of its
Subsidiaries or any of their respective properties and shall not be
discharged and there shall have been a period of thirty (30) days
during which a stay of enforcement of such judgment or order, by
reason of pending appeal or otherwise, shall not be in effect; or
(ix) any of the Financing Documents ceases to be in full force
and effect (other than as a result of termination pursuant to its
terms) or any such Financing Document or any of its material
provisions is declared or asserted to be null and void or otherwise
becomes unenforceable in accordance with its terms;
(x) the Company or any Subsidiary redeems, or calls for
redemption, or purchases or enters into any agreement with respect to
the redemption or purchase, or the holders thereof exercise any rights
to cause the redemption, of any shares of Series G Preferred Stock;
(xi) the Company or any Material Subsidiary of the Company
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding with respect to
itself,
(B) consents to the entry of an order for relief against it
in an involuntary case or proceeding,
(C) consents to the appointment of a Custodian of it or for
all or any material part of its property,
(D) makes a general assignment for the benefit of its
creditors,
(E) consents to or acquiesces in the institution of
bankruptcy or insolvency proceedings against it,
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(F) shall generally not pay its debts when such debts become
due or shall admit in writing its inability to pay its debts
generally, or
(G) takes any corporate action in furtherance of or to
facilitate, conditionally or otherwise, any of the foregoing; or
(xii) a court of competent jurisdiction enters a decree, judgment
or order under any Bankruptcy Law that:
(A) is for relief against the Company or any Material
Subsidiary of the Company in an involuntary case or proceeding,
(B) appoints a Custodian of the Company or any Material
Subsidiary of the Company for all or substantially all of its
properties, or
(C) orders the winding-up or liquidation of the Company or
any Material Subsidiary of the Company, and in each case the
order or decree remains unstayed and in effect for sixty (60)
days; or
(xiii) this Indenture ceases to be in full force and effect or
ceases to give the Trustee, an any material respect, the liens,
rights, powers and privileges purported to be created thereby, in each
case, as determined by a court of competent jurisdiction.
The Company shall, within sixty (60) days following the end of each of its
first three Fiscal Quarters, and within ninety (90) days following the end of
each of its Fiscal Years, file with the Trustee an Officers' Certificate
certifying that the Company has performed all of its obligations under this
Indenture in all material respects and that no Event of Default has occurred
during the preceding Fiscal Quarter or Fiscal Year, as the case may be, or in
the event any such Event of Default has occurred, the facts and circumstances
resulting in such Event of Default. The Company shall promptly upon the
occurrence thereof provide notice to the Trustee of an Event of Default.
SECTION 6.02. Acceleration.
If an Event of Default (other than an Event of Default specified in clause
(xi) or (xii) above with respect to the Company or any Material Subsidiary of
the Company) occurs and is continuing, then the Trustee or the Holders of at
least thirty percent (30%) in aggregate principal amount of the outstanding
Securities may, by written notice to the Company and the Trustee, and the
Trustee upon the request of the Holders of not less than thirty percent (30%) in
aggregate principal amount of the outstanding Securities shall, subject in each
case to Section 10.02(e), declare the Principal of and accrued and unpaid
interest, if any, on all the Securities on the date of such declaration to be
due and payable immediately together with an amount equal to the premium that
would be payable if all outstanding Securities at the time were redeemed by the
Company, or any Material Subsidiary of the Company, pursuant to Article III
hereof (the "Default Amount"). Upon any such declaration, the Default Amount
shall become due and payable immediately. If an Event of Default specified in
clause (xi) or (xii) above with respect to the Company occurs and is continuing,
53
then the Default Amount on all of the Securities shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
After a declaration of acceleration, the Required Holders may, by notice to
the Trustee, rescind such declaration of acceleration if all existing Events of
Default have been cured or waived, other than nonpayment of the Default Amount
on the Securities that have become due solely as a result of such acceleration
and if the rescission of acceleration would not conflict with any judgment,
order or decree by a court of competent jurisdiction. No such rescission shall
affect any subsequent Default or impair any right consequent thereto.
SECTION 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may, subject
to Section 10.02(e), pursue any available remedy by proceeding at law or in
equity to collect the payment of Principal of, or interest on the Securities or
to enforce the performance of any provision of the Securities or this Indenture
as may be required or permitted thereunder.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 6.02, 6.07 and 9.02, the Required Holders by notice to
the Trustee may waive an existing Default or Event of Default and its
consequences, except a Default in the payment of Principal of or interest on any
Security as specified in clauses (i) and (ii) of Section 6.01 or in respect of
any provision hereof which cannot be modified or amended without the consent of
the Holder so affected pursuant to Section 9.02. When a Default or Event of
Default is so waived, it shall be deemed cured and ceases to exist, but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.
SECTION 6.05. Control by Required Holders.
The Required Holders may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it including, without limitation, any remedies provided
for in Section 6.03. Subject to Section 7.01, however, the Trustee may refuse to
follow any direction that conflicts with any law or this Indenture that the
Trustee determines may be unduly prejudicial to the rights of another
Securityholder, or that may involve the Trustee in personal liability unless the
Trustee has asked for and received indemnification reasonably satisfactory to it
against any loss, liability or expense caused by its following such direction;
provided that the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
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SECTION 6.06. Limitation on Suits.
A Securityholder may not pursue any remedy with respect to this Indenture
or the Securities unless:
(a) the Holder gives to the Trustee notice of a continuing Event of
Default;
(b) Holders of at least thirty percent (30%) in principal amount of
the outstanding Securities make a written request to the Trustee to pursue
the remedy;
(c) such Holders offer to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense to be incurred in compliance
with such request;
(d) the Trustee does not comply with the request within thirty (30)
days after receipt of the request and the offer of indemnity; and
(e) during such thirty (30) day period the Required Holders do not
give the Trustee a direction which, in the opinion of the Trustee, is
inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over such other
Securityholder.
SECTION 6.07. Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, except as set forth
in Article X, the right of any Holder to receive payment of Principal of and
interest on a Security, on or after the respective due dates expressed in such
Security, or to bring suit for the enforcement of any such payment on or after
such respective dates, shall not be impaired or affected without the consent of
such Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default in payment of Principal or interest specified in
clause (i) or (ii) of Section 6.01 occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or any other obligor on the Securities for the whole amount of Principal
and accrued interest remaining unpaid, together with interest on overdue
Principal and, to the extent that payment of such interest is lawful, interest
on overdue installments of interest, in each case at the rate per annum borne by
the Securities and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, taxes,
disbursements and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relating to the Company or
any other obligor upon the Securities, any of their respective creditors or any
of their respective property and shall be entitled and empowered to collect and
receive any monies or other securities or property payable or deliverable upon
55
the conversion or exchange of the Securities or upon any such claims and to
distribute the same, and any Custodian in any such judicial proceedings is
hereby authorized by each Securityholder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such payments
directly to the Securityholders, to first pay to the Trustee any amount due to
it for the reasonable compensation, expenses, taxes, disbursements and advances
of the Trustee, its agent and counsel, and any other amounts due the Trustee
under Section 7.07. Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Security
holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof, or to authorize
the Trustee to vote in respect of the claim of any Security holder in any such
proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money pursuant to this Article VI, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Holders for Principal, interest and premiums owing under the
Securities, ratably, according to the amounts due and payable on the Securities
for Principal, in the following order of priority: first to any premiums, then
to interest and lastly to Principal; and
Third: to the Company or any other obligor on the Securities, as their
interests may appear, or as a court of competent jurisdiction may direct.
The Trustee, upon prior notice to the Company, may fix a record date and
payment date for any payment to Securityholders pursuant to this Section 6.10.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.07, or a suit by a Holder or Holders of more than ten percent (10%) in
principal amount of the outstanding Securities.
SECTION 6.12. 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
56
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.13. Delay or Omission Not Waiver.
No delay or omission by the Trustee or by any Holder of any Security to
exercise any right or remedy arising upon any Event of Default shall impair the
exercise of any such right or remedy or constitute a waiver of any such Event of
Default. Every right and remedy given by this Article VI 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.
ARTICLE VII.
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture and
covenants and agrees to perform the same, as herein expressed.
SECTION 7.01. Duties of Trustee.
(a) If a Default or an Event of Default 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:
(i) The Trustee need perform only those duties as are
specifically set forth in this Indenture and no others, and no
covenants or obligations shall be implied in this Indenture that are
adverse to the Trustee.
(ii) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the certificates
and opinions to determine whether or not they conform to the
requirements of this Indenture but need not verify the accuracy of the
contents thereof.
(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:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section 7.01;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
57
(iii) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity reasonably satisfactory to it against
any loss, liability or expense.
(e) 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.
(f) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b), (c), (d) and (e) of this Section 7.01.
(g) 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 7.02. Rights of Trustee.
Subject to Section 7.01:
(a) The Trustee may rely and shall be fully protected in acting or
refraining from acting upon any document believed by it to be genuine and
to have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may consult
with counsel and may require an Officers' Certificate or an Opinion of
Counsel, which shall conform to Sections 11.04 and 11.05 hereof. The
Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on such certificate or opinion.
(c) The Trustee may consult with counsel and the 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.
(d) The Trustee may act through its attorneys and agents and shall not
be responsible for the misconduct or negligence of any agent (other than
the negligence or misconduct of an agent who is an employee of the Trustee)
appointed with due care.
(e) The Trustee shall not be liable for any action that it takes or
omits to take in good faith which it believes to be authorized or within
its rights or powers, provided that the Trustee's conduct does not
constitute negligence or bad faith.
(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
58
debenture, or other paper or document, but the Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled, upon reasonable notice to
the Company, to examine the books, records, and premises of the Company,
personally or by agent or attorney.
(g) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which may
be incurred by it in compliance with such request, order or direction.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Securities and may otherwise deal with the Company, any Subsidiary of
the Company or their respective Affiliates with the same rights it would have if
it were not Trustee. Any Agent may do the same with like rights. However, the
Trustee must comply with Sections 7.10 and 7.11 hereof.
SECTION 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Securities. Further, the Trustee shall not be accountable for
the Company's use of the proceeds from the Securities, nor be responsible for
any statement in the Securities other than the Trustee's certificate of
authentication.
SECTION 7.05. Notice of Default.
If a Default or an Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to each Securityholder, as their
names and addresses appear on the Securityholder list described in Section 2.05
hereof, notice of the Default or Event of Default within thirty (30) days after
such Default or Event of Default has occurred, unless such Default or Event of
Default shall have been cured or waived. Except in the case of a Default or an
Event of Default in payment of Principal of or interest on, any Security, and a
Default or Event of Default that resulted from the failure to comply with
Section 4.17, 4.18 or 5.01 hereof, the Trustee may withhold the notice if and so
long as its Board of Directors, the executive committee of its Board of
Directors or a committee of its directors and/or Trust Officers in good faith
determines that withholding the notice is in the interest of the
Securityholders.
SECTION 7.06. Reports by Trustee to Holders.
If required by law, within sixty (60) days after each May 15 beginning with
the May 15 following the date of this Indenture, the Trustee shall mail to the
Holders, at the Company's expense, a brief report dated as of such reporting
date that complies with TIA ss.313(a) (but if no event described in TIA
ss.313(a) has occurred within the twelve months preceding the reporting date, no
59
report need be transmitted). The Trustee also shall comply with TIA ss.313(b)(2)
to the extent applicable. The Trustee shall also transmit by mail all reports as
required by TIA ss.313(c).
A copy of each report at the time of its mailing to Holders shall be filed
with the SEC and each stock exchange or market on which the Securities are
listed or quoted. The Company shall notify the Trustee when the Securities are
listed on any stock exchange or quoted on any market.
SECTION 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Company shall reimburse the Trustee upon request for all tax
obligations imposed on the Trustee related to this Indenture and all reasonable
out-of-pocket expenses incurred or made by it. Such expenses shall include the
reasonable fees and expenses of the Trustee's agents, compensation and counsel.
The Company shall indemnify the Trustee and its agents for, and hold them
harmless against, any loss, liability or expense incurred by them without
negligence, bad faith or willful misconduct on their part, arising out of or in
connection with the administration of this trust including the reasonable costs
and expenses of enforcing this Indenture against the Company (including Section
7.07 hereof) and of defending themselves against any claim (whether asserted by
any Security holder or the Company) or liability in connection with the exercise
or performance of any of their rights, powers or duties hereunder. The Trustee
shall notify the Company promptly of any claim asserted against the Trustee for
which it may seek indemnity. The Company shall defend the claim and the Trustee
shall cooperate in the defense. The Trustee may have separate counsel and the
Company shall pay the reasonable fees and expenses of such counsel; provided
that the Company will not be required to pay such fees and expenses if they
assume the Trustee's defense and there is no conflict of interest between the
Company and the Trustee in connection with such defense as reasonably determined
by the Trustee. The Company need not pay for any settlement made without its
written consent. The Company need not reimburse any expense or indemnify against
any loss or liability to the extent incurred by the Trustee through its
negligence, bad faith or willful misconduct.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Securities on all assets or money held or
collected by the Trustee, in its capacity as Trustee, except assets or money
held in trust to pay Principal of or interest on Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(xi) or (xii) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.08. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
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The Trustee may resign by so notifying the Company in writing at least
thirty (30) days prior to the date of the proposed resignation; provided,
however, that no such resignation shall be effective until a successor Trustee
has accepted its appointment pursuant to this Section 7.08. The Required Holders
may remove the Trustee by so notifying the Company and the Trustee and may
appoint a successor Trustee with the Company's consent. The Company may remove
the Trustee if:
(a) the Trustee fails to comply with Section 7.01 or 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a receiver Custodian or other public officer takes charge of the
Trustee or its property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall notify each Holder of such event
and shall promptly appoint a successor Trustee. Within one (1) year after the
successor Trustee takes office, the Required Holders may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Immediately after that, the retiring
Trustee shall transfer all property held by it as Trustee to the successor
Trustee, subject to the lien provided in Section 7.07, the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Security holder.
If a successor Trustee does not take office within sixty (60) days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of at least ten percent (10%) in principal amount of the outstanding
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Security holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, Etc.
If the Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the resulting, surviving or transferee corporation without any further act
shall, if such resulting, surviving or transferee corporation is otherwise
eligible hereunder, be the successor Trustee.
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SECTION 7.10. Eligibility: Disqualification.
This Indenture shall always have a Trustee who satisfies the requirement of
TIA ss.ss.310(a)(1) and 310(a)(5). The Trustee (or in the case of a corporation
included in a bank holding company system, the related bank holding company)
shall always have a combined capital and surplus of at least $500,000,000 as set
forth in its most recent published annual report of condition. In addition, if
the Trustee is a corporation included in a bank holding company system, the
Trustee, independently of such bank holding company, shall meet the capital
requirements of TIA ss.310(a)(2). The Trustee shall comply with TIA ss.310(b)
including the optional provision permitted by the second sentence of TIA
ss.309(b)(9); provided, however, that there shall be excluded from the operation
of TIA ss.310(b)(1) any indenture or indentures under which other securities, or
certificates of interest or participation in other securities, of the Company
are outstanding, if the requirements for such exclusion set forth in TIA
ss.310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA ss.311(a), excluding any creditor
relationship listed in TIA ss.311(b). A Trustee who has resigned or been removed
shall be subject to TIA ss.311(a) to the extent indicated therein.
ARTICLE VIII.
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Indenture.
This Indenture shall cease to be of further effect (except that the
Company's obligations under Sections 7.07, 8.04 and 8.05 shall survive) as to
all outstanding Securities when all such Securities theretofore authenticated
and delivered (except lost, stolen or destroyed Securities which have been
replaced or paid and Securities for the payment of which money 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) have been
delivered to the Trustee for cancellation and the Company has paid all sums
payable hereunder. In addition, the Company may terminate all of its obligations
under this Indenture (except the Company's obligations under Sections 7.07, 8.04
and 8.05) if:
(a) either (i) pursuant and subject to compliance with Article III,
the Company shall have given notice to the Trustee and mailed a notice of
redemption to each Holder of the redemption of all of the Securities or
(ii) all Securities have otherwise become due and payable in accordance
with the terms of this Indenture (including the provisions of Article X).
(b) the Company shall have irrevocably deposited or caused to be
deposited with the Trustee or a trustee satisfactory to the Trustee, under
the terms of an irrevocable trust agreement in form and substance
satisfactory to the Trustee, as trust funds in trust solely for the benefit
of the Holders for that purpose, U.S. Legal Tender sufficient to pay
Principal of and interest, if any, on the outstanding Securities to
redemption; provided that the Trustee shall have been irrevocably
62
instructed to apply such U.S. Legal Tender to the payment of said Principal
and interest with respect to the Securities;
(c) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent providing for the termination of the Company's obligation under
the Securities and this Indenture have been complied with; and
(d) the Company shall have paid all sums payable by it hereunder.
Notwithstanding the foregoing paragraph, the Company's obligations in
Sections 2.03, 2.04, 2.05, 2.06, 2.07, 4.01, 4.02, 7.07, 7.08, 8.03, 8.04 and
8.05 hereof shall survive until the Securities are no longer outstanding. After
the Securities are no longer outstanding, the Company's obligations in Sections
7.07, 8.04 and 8.05 hereof shall survive.
After such delivery or irrevocable deposit the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Securities and this Indenture except for those surviving obligations specified
above.
SECTION 8.02. Legal Defeasance and Covenant Defeasance.
(a) The Company may, at its option by Board Resolution, at any time,
with respect to the Securities, elect to have either paragraph (b) or
paragraph (c) below be applied to the outstanding Securities upon
compliance with the conditions set forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (b), the Company shall be deemed to have been
released and discharged from its obligations with respect to the
outstanding Securities on the date the conditions set forth in paragraph
(d) below are satisfied (hereinafter, "legal defeasance"). For this
purpose, such legal defeasance means that the Company shall be deemed to
have paid and discharged the entire indebtedness represented by the
outstanding Securities, which shall thereafter be deemed to be
"outstanding" only for the purposes of paragraph (e) below and the other
Sections of and matters under this Indenture referred to in (i) and (ii)
below, and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and
the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (i) the rights
of Holders of outstanding Securities to receive solely from the trust fund
described in paragraph (d) below and as more fully set forth in such
paragraph, payments in respect of the Principal of and interest on such
Securities when such payments are due, (ii) the Company's obligations with
respect to such Securities under Sections 2.03, 2.04, 2.05, 2.06, 2.07,
4.02, 7.07, 7.08, 8.03, 8.04 and 8.05, (iii) the rights, powers, trusts,
duties and immunities of the Trustee hereunder, and (iv) this Section 8.02.
Subject to compliance with this Section 8.02, the Company may exercise its
option under this paragraph (b) notwithstanding the prior exercise of its
option under paragraph (c) below with respect to the Securities.
(c) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (c), the Company shall be released and
discharged from its obligations under any covenant contained in Article V
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and in Sections 4.11 through 4.19 with respect to the outstanding
Securities on and after the date the conditions set forth in paragraph (d)
below are satisfied (hereinafter, "covenant defeasance"), and the
Securities shall thereafter be deemed to be not "outstanding" for the
purpose of any direction, waiver, consent or declaration or act of Holders
(and the consequences of any thereof) in connection with such covenants,
but shall continue to be deemed "outstanding" for all other purposes
hereunder. For this purpose, such covenant defeasance means that, with
respect to the outstanding Securities, the Company may omit to comply with
and shall have no liability in respect of any term, condition or limitation
set forth in any such covenant, whether directly or indirectly, by reason
of any reference elsewhere herein to any such covenant or by reason of any
reference in any such covenant to any other provision herein or in any
other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 6.01, but, except as specified above,
the remainder of this Indenture and such Securities shall be unaffected
thereby.
(d) The following shall be the conditions to application of either
paragraph (b) or paragraph (c) above to the outstanding Securities:
(i) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the
requirements of Section 7.10 who shall agree to comply with the
provisions of this Section 8.02 applicable to it) as trust funds in
trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of such Securities, (A) U.S. Legal Tender in an amount, or (B)
U.S. Government Obligations which through the scheduled payment of
Principal of and interest in respect thereof in accordance with their
terms will provide (without giving effect to the reinvestment of any
interest thereon), not later than one (1) day before the due date of
any payment, U.S. Legal Tender in an amount, or (C) a combination
thereof, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge and which shall
be applied by the Trustee (or other qualifying trustee) to pay and
discharge Principal of and interest, on the outstanding Securities on
the Maturity Date of such principal or installment of principal or
interest in accordance with the terms of this Indenture and of such
Securities; provided, however, that the Trustee (or other qualifying
trustee) shall have received an irrevocable Company Order instructing
the Trustee (or other qualifying trustee) to apply such U.S. Legal
Tender or the proceeds of such U.S. Government Obligations to said
payments with respect to the Securities;
(ii) no Default or Event of Default or event which with notice or
lapse of time or both would become a Default or an Event of Default
with respect to the Securities shall have occurred and be continuing
on the date of such deposit or, in so far as Sections 6.01(xi) and
(xii) are concerned, at any time during the period ending on the 91st
day after the date of such deposit (it being understood that this
condition shall not be deemed satisfied until the expiration of such
period);
(iii) such legal defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a Default or Event
of Default under, this Indenture or any other agreement or instrument
to which the Company or any of its Subsidiaries is a party or by which
any of them is bound;
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(iv) in the case of an election under paragraph (b) above, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (y) since the
date of this Indenture, there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the
outstanding Securities will not recognize income, gain or loss for
Federal income tax purposes as a result of such legal defeasance and
will be subject to Federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such legal
defeasance had not occurred;
(v) in the case of an election under paragraph (c) above, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of the outstanding Securities will not
recognize income, gain or loss for Federal income tax purposes as a
result of such covenant defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not
occurred;
(vi) in the case of an election under either paragraph (b) or (c)
above, an Opinion of Counsel to the effect that, (x) the trust funds
will not be subject to any rights of any other holders of any other
Indebtedness of the Company after the 91st day following the deposit,
and (y) after the 91st day following the deposit, the trust funds will
not be subject to the effect of any applicable Bankruptcy Law;
(vii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that (A)
all conditions precedent provided for relating to either the legal
defeasance under paragraph (b) above or the covenant defeasance under
paragraph (c) above, as the case may be, have been complied with; and
(B) if any other Indebtedness of the Company (including, without
limitation, the Senior Indebtedness) shall then be outstanding, such
legal defeasance will not violate the provisions of the agreements or
instruments evidencing such Indebtedness; and
(viii) 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
over other creditors of the Company or with the intent of defeating,
hindering, delaying or defrauding creditors of the Company or others.
(e) All money and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee,
collectively for purposes of this paragraph (e), the "Trustee") pursuant to
paragraph (d) above in respect of the outstanding Securities shall be held
in trust and applied by the Trustee, in accordance with the provisions of
such Securities and this Indenture, to the payment, either directly or
through any Paying Agent as the Trustee may determine, to the Holders of
such Securities of all sums due and to become due thereon in respect of
Principal, and interest, but such money need not be segregated from other
funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to paragraph (d) above or the Principal and interest received
65
in respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of the outstanding Securities.
Anything in this Section 8.02 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request, in
writing, by the Company any money or U.S. Government Obligations held by it as
provided in paragraph (d) above which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, are in excess of the amount thereof which
would then be required to be deposited to effect an equivalent legal defeasance
or covenant defeasance.
SECTION 8.03. Application of Trust Money.
The Trustee shall hold in trust U.S. Legal Tender or U.S. Government
Obligations deposited with it pursuant to Sections 8.01 and 8.02, and shall
apply the deposited U.S. Legal Tender and the U.S. Legal Tender from U.S.
Government Obligations in accordance with this Indenture to the payment of
Principal of and interest on the Securities.
SECTION 8.04. Repayment to Company.
Subject to Sections 7.07, 8.01 and 8.02, the Trustee shall, subject to
Article X, promptly pay to the Company, upon receipt by the Trustee of an
Officers' Certificate, any excess money, determined in accordance with Sections
8.02(d)(i) and (e), held by it at any time. The Trustee and the Paying Agent
shall pay to the Company upon receipt by the Trustee or the Paying Agent, as the
case may be, of an Officers' Certificate, any money held by it for the payment
of Principal or interest that remains unclaimed for two (2) years, provided,
however, that the Trustee and the Paying Agent before being required to make any
payment may, but need not, at the expense of the Company, cause to be published
once in a newspaper of general circulation in The City of New York or mail to
each Holder entitled to such money notice that such money remains unclaimed and
that after a date specified therein, which shall be at least thirty (30) days
from the date of such publication or mailing, any unclaimed balance of such
money then remaining will be repaid to the Company. After payment to the
Company, Securityholders entitled to money must look solely to the Company for
payment as general creditors unless an applicable abandoned property law
designates another person.
SECTION 8.05. Reinstatement.
If the Trustee or Paying Agent is unable to apply any U.S. Legal Tender or
U.S. Government Obligations in accordance with this Indenture by reason of any
legal proceeding or by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then and only then the Company's obligations under this Indenture
and the Securities shall be revived and reinstated as though no deposit had been
made pursuant to this Indenture until such time as the Trustee is permitted to
apply all such U.S. Legal Tender or U.S. Government Obligations in accordance
with this Indenture; provided, however, that if the Company has made any payment
of Principal of or interest on of any Securities because of the reinstatement of
its obligations, the Company shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the U.S. Legal Tender or U.S.
Government Obligations held by the Trustee or Paying Agent.
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SECTION 8.06. Acknowledgment of Discharge by Trustee.
After (i) the conditions of Section 8.02 have been satisfied, (ii) the
Company has paid or caused to be paid all other sums payable hereunder by the
Company, and (iii) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent referred to in clause (i) above relating to the satisfaction and
discharge of this Indenture have been complied with, the Trustee upon written
request shall acknowledge in writing the discharge of the Company's obligations
under this Indenture except for those surviving obligations specified in Section
8.01.
ARTICLE IX.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders.
The Company, when authorized by its Board Resolution, and the Trustee,
together, may without notice to or the consent of any Securityholder amend,
waive or supplement this Indenture or the Securities:
(i) to cure any ambiguity, defect or inconsistency or to make any
other provisions with respect to matters or questions arising under
this Indenture; provided that such action does not adversely affect
the rights of any Holder;
(ii) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon
the Company, or to provide any additional rights or benefits to the
Holders;
(iii) to evidence the succession of another person to the
Company, and the assumption by any such successor of the obligations
of the Company herein and in the Securities in accordance with Article
V;
(iv) to provide for uncertificated Securities in addition to or
in place of certificated Securities;
(v) to make any other change that does not adversely affect the
rights of any Securityholders hereunder;
(vi) to comply with the TIA; or
(vii) to comply with any requirements of the SEC in connection
with the qualification of this Indenture under the TIA;
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provided that the Company has delivered to the Trustee an Opinion of Counsel and
an Officers' Certificate, each stating that such amendment or supplement
complies with the provisions of this Section 9.01.
SECTION 9.02. With Consent of Holders.
Subject to Section 6.07, the Company when authorized by its Board
Resolution, and the Trustee, together, with the written consent of the Required
Holders, may amend or supplement this Indenture or the Securities, without
notice to any other Securityholders. However, without the consent of each
Securityholder affected, no amendment, supplement or waiver, including a waiver
pursuant to Section 6.04, may:
(i) reduce the principal amount of any Security or premium, if
any, with respect thereto;
(ii) change the Maturity Date of, or alter the redemption or
repurchase or other provisions of the Securities, in a manner that
adversely affects the rights of any Holder;
(iii) reduce the percentage in principal amount outstanding of
Securities which must consent to an amendment, supplement or waiver or
consent to take any action under this Indenture or the Securities;
(iv) impair the right to institute suit for the enforcement of
any payment on or with respect to the Securities;
(v) make any changes in the provisions concerning waivers of
Defaults or Events of Default by Holders of the Securities or the
rights of Holders to recover the principal of, interest on, or
redemption payment with respect to, any Security;
(vi) make any change in or affecting the ranking of the
Securities with respect to any other obligation of the Company or any
Subsidiary in a way that adversely affects the rights of any Holder;
(vii) reduce the interest rate or extend the time for payment of
interest, if any, on the Securities;
(viii) make the principal of, premium, if any, or the interest
on, any Security payable with anything, at any place of payment or in
any manner other then as provided for in this Indenture and the
Security as in effect on the date hereof;
(ix) following the mailing of a Change of Control Offer, modify
the provisions of this Indenture with respect to such Change of
Control Offer in a manner adverse to any Holder; or
(x) make any changes in this Section 9.02 in a manner that
adversely affects the rights of any Holder.
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It shall not be necessary for the consent of the Holders under this Section
to approve the particular form of any proposed amendment, supplement or waiver,
but it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amendment, supplement or waiver.
SECTION 9.03. Compliance with TIA.
Every amendment, waiver or supplement of this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, waiver or supplement becomes effective, a consent to it
by a Holder is a continuing consent by the Holder and every subsequent Holder of
a Security or portion of a Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security. However, prior to becoming effective, any such Holder or subsequent
Holder may revoke the consent as to his Security or portion of his Security by
notice to the Trustee or the Company if such notice is received by the Trustee
or the Company before the date on which the Trustee receives an Officers'
Certificate certifying that the Holders of the requisite principal amount of
Securities have consented (and not theretofore revoked such consent) to the
amendment, supplement or waiver. Notwithstanding the above, nothing in this
paragraph shall impair the right of any Securityholder under ss.316(b) of the
TIA.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the last
sentence of the immediately preceding paragraph, those persons who were Holders
at such record date (or their duly designated proxies), and only those persons,
shall be entitled to revoke any consent previously given, whether or not such
persons continue to be Holders after such record date. No such consent shall be
valid or effective for more than ninety (90) days after such record date unless
consents from Holders of the principal amount of Securities required hereunder
for such amendment, supplement or waiver to be effective shall have been given
and not revoked within such ninety (90) day period.
After an amendment, supplement or waiver becomes effective, it shall bind
every Securityholder, unless it makes a change described in any of clauses (i)
through (x) of Section 9.02, in which case, the amendment, supplement or waiver
shall bind only each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security; provided, however, that any such
waiver shall not impair or affect the right of any Holder to receive payment of
Principal of and interest on a Security, on or after the respective dates set
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for such amounts to become due and payable expressed in such Security, or to
bring suit for the enforcement of any such payment on or after such respective
dates.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security, the
Trustee may require the Holder of the Security to deliver the Security to the
Trustee. The Trustee may place an appropriate notation on the Security about the
changed terms and return the Security to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Security
shall issue and the Trustee shall authenticate a new Security that reflects the
changed terms. Failure to make the appropriate notation or issue a new Security
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 9.06. Trustee To Sign Amendments, Etc.
Subject to the next sentence, the Trustee shall execute any amendment,
supplement or waiver authorized pursuant to this Article IX, provided, however,
that the Trustee may, but shall not be obligated to, execute any such amendment,
supplement or waiver which affects the Trustee's own rights, duties or
immunities under this Indenture. The Trustee shall be entitled to receive, and
shall be fully protected in relying upon, an Opinion of Counsel and an Officers'
Certificate each stating that the execution of any amendment, supplement or
waiver is authorized or permitted by this Indenture.
ARTICLE X.
SUBORDINATION
SECTION 10.01. Securities Subordinated to Senior Indebtedness.
The Company covenants and agrees, and each Holder (and each Person holding
any Security, whether upon original issue, or upon transfer, assignment or
exchange thereof) of the Securities, by its acceptance thereof, likewise
covenants and agrees that: (i) all Securities shall be issued subject to the
provisions of this Article X; (ii) the payment of the Principal of, and interest
on, the Securities by the Company shall, to the extent and in the manner herein
set forth, be subordinated and junior in right of payment to the prior payment
in full, in cash or Cash Equivalents, of the Senior Indebtedness; and (iii) the
subordination is for the benefit of, and shall be relied upon and be enforceable
directly by, the holders of Senior Indebtedness. The Company and each Holder
hereby agree not to amend, modify or change in any manner any provision of this
Article X (and any defined term used in this Article X) so that the terms and
conditions hereof, as so amended, modified or changed, are less favorable to the
holders of the Senior Indebtedness and their Representative than the terms
hereof on the Issue Date, without the prior written consent of the necessary
holders of Senior Indebtedness as required under the Credit Agreement.
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SECTION 10.02. Suspension of Payment on Securities in Certain Events.
(a) If (i) any default occurs and is continuing after the expiration
of any applicable cure period (each a "Senior Debt Payment Default"), in
the payment when due, whether at maturity, upon any redemption, by
declaration or otherwise, of any Principal of, or interest on the Senior
Indebtedness, or fees or other amounts due under the terms of the Credit
Agreement, and (ii) the Representative of the holders of the Senior
Indebtedness gives written notice (a "Default Notice") of such Senior Debt
Payment Default to the Trustee, then no payment of any kind or character
shall be made by or on behalf of the Company or any other Person on its
behalf with respect to any Principal of, or interest on or fees or other
amounts due with respect to, the Securities or to redeem, repurchase or
otherwise acquire any of the Securities for cash or property or otherwise,
until such payment is made in full or Senior Payment Default has been
cured, waived or has ceased to exist.
(b) If (i) any event of default other than a Senior Debt Payment
Default (a "Senior Debt Other Default") occurs and is continuing with
respect to the Senior Indebtedness, as such Senior Debt Other Default is
defined in the instrument creating or evidencing such Senior Indebtedness,
permitting the holders of such Senior Indebtedness to accelerate the
maturity thereof, and (ii) the Representative of the holders of the Senior
Indebtedness gives a Default Notice to the Trustee, then until the earlier
of (A) the Trustee receiving notice from the Representative of the holders
of the Senior Indebtedness terminating the Blockage Period (as defined
below), (B) the date on which the Senior Debt Other Default giving rise to
the Blockage Period is cured or waived, or (C) 180 days after the delivery
of such Default Notice (the "Blockage Period"), neither the Company nor any
other Person on its behalf shall make any payment of any kind or character
with respect to any Principal of, or interest on, or fees or other amounts
due with respect to the Securities, or redeem, repurchase or otherwise
acquire any of the Securities for cash or property or otherwise; provided,
however, that if such Senior Indebtedness has not been accelerated or
become the subject of judicial proceedings within the Blockage Period, then
the Company shall resume making any and all required payments in respect of
the Securities. At the expiration or termination, as applicable, of such
Blockage Period the Company shall promptly pay to the Trustee all sums not
paid during such Blockage Period as a result of this subsection (b).
Notwithstanding anything herein to the contrary, in no event will a
Blockage Period extend beyond 180 days from the date of the Senior Debt
Other Default and only one such Blockage Period may be commenced within any
period of 360 consecutive days. No Senior Debt Other Default or event
which, with the giving of notice and/or lapse of time or otherwise, would
become a Senior Debt Other Default which existed on the date of the
commencement of such Blockage Period, may be used as the basis for
declaring any subsequent Blockage Period unless such Senior Debt Other
Default or event, as the case may be, shall in the interim have been cured
or waived for a period of not less than ninety (90) consecutive days.
(c) In the event that, notwithstanding the foregoing, any payment
shall be received by the Trustee or any Holder when such payment is
prohibited by Sections 10.02(a) and (b), then unless and until such payment
is no longer prohibited by this Section 10.02, such payment shall be held
in trust for the benefit of, and shall as soon practicable be paid over or
delivered to, the Representative of the holders of the Senior Indebtedness.
No amount paid by the Company, or any other Person on its behalf, to the
Trustee or any Holder of the Securities, and paid over by such Person to
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the Representative of the holders of the Senior Indebtedness pursuant to
this Article X shall, as between the Company and the Holders of the
Securities, be deemed a payment by the Company to or on account of any
payments due in respect of the Securities.
(d) The Company shall give prompt written notice to the Trustee of any
Senior Debt Payment Default or any Senior Debt Other Default, under the
Senior Indebtedness or under any agreement pursuant to which Senior
Indebtedness may have been issued. Failure to give such notice shall not
affect the subordination of the Securities to the Senior Indebtedness
provided in this Article X.
(e) Nothing contained in this Article X shall limit the right of the
Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Section 6.02 or to pursue any rights
or remedies available under this Indenture or otherwise; provided that the
Trustee or the Holders shall, prior to commencing any such action, provide
the Representative of the holders of the Senior Indebtedness with five (5)
days prior written notice of its intention to take such action; provided
further that all Senior Indebtedness thereafter due or declared to be due
shall first be paid in full, in cash or Cash Equivalents, before the
Holders are entitled to receive any payment of any kind or character with
respect to Principal of, or interest on or fees or other amounts due with
respect to, the Securities.
SECTION 10.03. Securities Subordinated to Prior Payment of All Senior
Indebtedness on Dissolution, Liquidation or Reorganization of Company.
(a) Upon any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, to creditors
upon any liquidation, dissolution, winding-up, reorganization, assignment
for the benefit of creditors or marshaling of assets of the Company or in a
bankruptcy, reorganization, insolvency, receivership or other similar
proceeding relating to the Company or its property, whether voluntary or
involuntary, all Senior Indebtedness shall first be paid in full in, cash
or Cash Equivalents (or such payment shall be duly provided for), before
any payment or distribution of any kind or character is made on account of
any Principal of, or interest on, or fees or other amounts due with respect
to, the Securities, or for the acquisition of any of the Securities for
cash or property or otherwise. Upon any such dissolution, winding-up,
liquidation, reorganization, receivership or similar proceeding, any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the Holders of the
Securities or the Trustee under this Indenture would be entitled, except
for the provisions hereof, shall be paid by the Company or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other Person making
such payment or distribution, or by the Holders or by the Trustee under
this Indenture if received by them, to the Representative of the holders of
the Senior Indebtedness, for application to the payment of Senior
Indebtedness remaining unpaid until all such Senior Indebtedness has been
paid in full, in cash or Cash Equivalents, after giving effect to any
concurrent payment, distribution or provision therefor to or for the
holders of Senior Indebtedness.
(b) To the extent any payment of Senior Indebtedness (whether by or on
behalf of the Company, as proceeds of security or enforcement of any right
of setoff or otherwise) is declared to be fraudulent or preferential, set
aside or required to be paid to any receiver, trustee in bankruptcy,
liquidating trustee, agent or other similar Person under any bankruptcy,
72
insolvency, receivership, fraudulent conveyance or similar law, then, if
such payment is recovered by, or paid over to, such receiver, trustee in
bankruptcy, liquidating trustee, agent or other similar Person, the Senior
Indebtedness or part thereof originally intended to be satisfied shall be
deemed to be reinstated and outstanding as if such payment has not
occurred.
(c) The consolidation of the Company with, or the merger of the
Company with or into, another corporation or the liquidation or dissolution
of the Company following the conveyance or transfer of all or substantially
all of its assets, to another corporation upon the terms and conditions
provided in Article V hereof and as long as permitted under the terms of
the Senior Indebtedness shall not be deemed a dissolution, winding-up,
liquidation or reorganization for the purposes of this Section if such
other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, assume in writing, to the reasonable satisfaction
of the Representative, the Company's obligations hereunder in accordance
with Article V hereof.
(d) The Company shall give prompt written notice to the Trustee of any
dissolution, winding-up, liquidation or reorganization of the Company, but
failure to give such notice shall not affect the subordination of the
Securities to the Senior Indebtedness provided in this Article X.
SECTION 10.04. Holders to be Subrogated to Rights of Holders of Senior
Indebtedness.
Subject to the payment in full, in cash or Cash Equivalents, of the Senior
Indebtedness, the Holders shall be subrogated to the rights of the holders of
Senior Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
Securities shall be paid or converted in full. For the purposes of such
subrogation, no such payments or distributions of cash, property or securities
of the Company to the holders of the Senior Indebtedness by or on behalf of the
Company or by or on behalf of the Holders by virtue of this Article X which
otherwise would have been made to the Holders shall, as between the Company and
the Holders, be deemed to be a payment by the Company to or on account of the
Senior Indebtedness, it being understood that the provisions of this Article X
are and are intended solely for the purpose of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
SECTION 10.05. Obligations of the Company Unconditional.
Nothing contained in this Article X or elsewhere in this Indenture or in
the Securities, is intended to or shall impair, as between the Company and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders the principal of, and interest on, the Securities as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company other than the holders of the Senior Indebtedness, nor shall
anything herein or therein prevent the Trustee or any Holder from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article X of the holders of
Senior Indebtedness in respect of cash, property or securities of the Company
received upon the exercise of any such remedy. Upon any payment or distribution
of cash, property or securities of the Company referred to in this Article X,
the Trustee, subject to the provisions of Sections 7.01 and 7.02, and the
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Holders shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which any liquidation, dissolution, winding-up or
reorganization proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidating trustee or agent or other Person making any
payment or distribution to the Trustee or to the Holders for the purpose of
ascertaining (i) the Persons entitled to participate in such payment or
distribution, (ii) the holders of Senior Indebtedness and other Indebtedness of
the Company, (iii) the amount thereof or payable thereon, (iv) the amount or
amounts paid or distributed thereon, and (iv) all other facts pertinent thereto
or to this Article X. Nothing in this Article X shall apply to the claims of, or
payments to, the Trustee under or pursuant to Section 7.07. The Trustee, subject
to Section 1.01, shall be entitled to rely on the delivery to it of a written
notice by a Person representing himself or itself to be the Representative of
the holders of the Senior Indebtedness. In the event that the Trustee determines
in good faith that any evidence is required with respect to the right of any
Person as a Representative of the holders of the Senior Indebtedness, the
Trustee may request such Person to furnish evidence thereof to the reasonable
satisfaction of the Trustee, and if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to right
of such Person to receive such payment on behalf of the holders of the Secured
Indebtedness.
SECTION 10.06. Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice.
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 pursuant to the provisions of this Article
X. Regardless of anything to the contrary contained in this Article X or
elsewhere in this Indenture, the Trustee shall not be charged with knowledge of
the existence of any Senior Debt Payment Default or Senior Debt Other Default or
of any other facts which would prohibit the making of any payment to or by the
Trustee unless and until the Trustee shall have received notice in writing from
the Company, or from a holder of Senior Indebtedness or a Representative
thereof, together with proof satisfactory to the Trustee of such holding of
Senior Indebtedness or of the authority of such Representative, and, prior to
the receipt of any such written notice, the Trustee shall be entitled to assume
(in the absence of actual knowledge to the contrary), subject to the provisions
of Section 7.01 and 7.02 that no such facts exist.
SECTION 10.07. Application by Trustee of Assets Deposited with It.
U.S. Legal Tender or U.S. Government Obligations deposited in trust with
the Trustee pursuant to and in accordance with Sections 8.01 and 8.02 shall be
for the sole benefit of the Holders of the Securities and, to the extent
allocated for the payment of Securities, shall not be subject to the
subordination provisions of this Article X. Otherwise, any deposit of assets,
property or securities by or on behalf of the Company with the Trustee or any
Paying Agent (whether or not in trust) for the payment of Principal of, or
interest on, any Securities shall be subject to the provisions of this Article
X; provided, however, that if prior to the second Business Day preceding the
date on which by the terms of this Indenture any such assets may become
distributable for any purpose (including, without limitation, the payment of
either Principal of, or interest on, any Security) the Trustee or such Paying
Agent shall not have received with respect to such assets the notice provided
for in Section 10.06, then the Trustee or such Paying Agent shall have full
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power and authority to receive such assets and to apply the same to the purpose
for which they were received, and shall not be affected by any notice to the
contrary received by it on or after such date. Nothing contained in this Section
10.07 shall limit the right of the holders of Senior Indebtedness to recover
payments as contemplated by this Article X.
SECTION 10.08. 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
10.08, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustees or the Holders,
without incurring responsibility to the Holders and without impairing or
releasing the subordination provided in this Article X or the obligations
hereunder of the Holders to the holders of Senior Indebtedness, do any one
or more of the following: (1) change the manner, place, terms or 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
Senior Indebtedness; and (4) exercise or refrain from exercising any rights
against the Company and any other Person.
SECTION 10.09. Holders Authorize Trustee to Effectuate Subordination of
Notes.
Each Holder of the Securities by such Holders' acceptance thereof
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate, as between the Holders and the
holders of Senior Indebtedness, the subordination provisions contained in this
Article X, and appoints the Trustee such Holders' attorney-in-fact for such
purpose, including, in the event of any liquidation, dissolution, winding-up,
reorganization, assignment for the benefit of creditors or marshaling of assets
of the Company (whether in bankruptcy, insolvency or receivership proceedings or
upon assignment for the benefit of creditors or otherwise) tending towards
liquidation of the business and assets of the Company, the immediate filing of a
claim for the unpaid balance of such Holder's Securities in the form required in
said proceedings and cause said claim to be approved. If the Trustee does not
file a proper claim or proof of debt in the form required in such proceeding
prior to thirty (30) days before the expiration of the time to file such claim
or proof, then any of the holders of the Senior Indebtedness or their
Representative is hereby authorized, but is not obligated, to file an
appropriate claim for and on behalf of the Holders of said Securities. Nothing
herein contained shall be deemed to authorize the Trustee or the holders of
Senior Indebtedness or their Representative to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorized the Trustee or the holders of Senior Indebtedness or
their Representative to vote in respect of the claim of any Holder in any such
proceeding.
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SECTION 10.10. Right of Trustee to Hold Senior Indebtedness.
The Trustee and any agent of the Company shall be entitled to all the
rights set forth in this Article X with respect to any Senior Indebtedness which
may at any time be held by it in its individual or any other capacity to the
same extent as any other holder of Senior Indebtedness and nothing in this
Indenture shall deprive the Trustee or any such agent of any of its rights as
such holder.
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 X, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee.
Whenever a distribution is to be made or a notice given to holders or
owners of Senior Indebtedness, the distribution will be made and the notice will
be given to their Representative.
SECTION 10.11. This Article X Not To Prevent Events of Default.
The failure to make a payment on account of Principal of, or interest on,
the Securities by reason of any provision of this Article X will not be
construed as preventing the occurrence of an Event of Default.
Nothing contained in this Article X shall limit the right of the Trustee or
the Holders of the Securities to take any action to accelerate the maturity of
the Securities pursuant to Article VI or to pursue any rights or remedies
hereunder or under applicable law, subject to the rights, if any, under this
Article X of the holders, from time to time, of Senior Indebtedness.
SECTION 10.12. No Fiduciary Duty of Trustee to Holders of Senior
Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to the holders of
Senior Indebtedness, and it undertakes to perform or observe such of its
covenants and obligations as are specifically set forth in this Article X, and
no implied covenants or obligations with respect to the Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
liable to any such holders (other than for its willful misconduct or gross
negligence) if it shall pay over or deliver to the Holders or the Company or any
other Person money or assets in compliance with the terms of this Indenture.
Nothing in this Section 10.12 shall affect the obligation of any Person other
than the Trustee to hold such payment for the benefit of, and to pay such
payment over to, the holders of Senior Indebtedness or their Representative.
ARTICLE XI.
MISCELLANEOUS
SECTION 11.01. TIA Controls.
If any provision of this Indenture limits, qualifies, or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the required provision shall control.
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SECTION 11.02. Notices.
Any notices or other communications required or permitted hereunder shall
be in writing, and shall be sufficiently given if made by hand delivery, by
telex, by telecopier or registered or certified mail, postage prepaid, return
receipt requested, or overnight courier addressed as follows:
if to the Company:
Headway Corporate Resources, Inc.
317 Madison Avenue, 3rd Floor
New York, NY 10022
Attention: Ms. Philicia G. Levinson, Senior Vice
President and Chief Financial Officer
Fax: (212) 672-6699
with a copy to:
Salans Hertzfeld Heilbronn Christy & Viener
Rockefeller Center
620 Fifth Avenue
New York, New York 10020
Attention: Richard B. Salomon, Esq.
Fax: (212) 632-5555
and:
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153-0119
Attention: Warren Buhle
Fax: (212) 310-8007
if to the Trustee:
State Street Bank and Trust Company, N. A.
61 Broadway
15th Floor
New York, NY 10006
Attention: Corporate Trust Department
Fax: (212) 612-3202
Each of the Company and the Trustee by written notice to each other may
designate additional or different addresses for notices. Any notice or
communication to the Company or the Trustee shall be deemed to have been given
or made as of the date so delivered, if personally delivered; when answered
back, if telexed; when receipt is acknowledged, if faxed; five (5) calendar days
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after mailing, if sent by registered or certified mail, postage prepaid (except
that a notice of change of address shall not be deemed to have been given until
actually received by the addressee); and the next Business Day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next day
delivery.
Any notice or communication mailed to a Securityholder, including any
notice delivered in connection with TIA ss.310(b), TIA ss.313(c), TIA ss.314(a)
and TIA ss.315(b) shall be mailed to him by first class mail or other equivalent
means at his address as it appears on the registration books of the Registrar
and shall be sufficiently given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 11.03. Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA ss.312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other person shall
have the protection of TIA ss.312(c).
SECTION 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee at the
request of the Trustee:
(a) an Officers' Certificate (in form and substance reasonably
satisfactory to the Trustee) stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(b) an Opinion of Counsel (in form and reasonably satisfactory to the
Trustee) stating that, in the opinion of such counsel, all such conditions
precedent have been complied with.
SECTION 11.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(a) a statement that the person making such certificate or opinion has
read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
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(c) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether or not, in the opinion of each such
person, such condition or covenant has been complied with; provided,
however, that, with respect to certain matters of fact not involving any
legal conclusion, an Opinion of Counsel may, upon the consent of the
parties relying on such opinion, rely on an Officers' Certificate or
certificates of public officials.
SECTION 11.06. Rules by Trustee, Paying Agent, Registrar.
The Trustee may make reasonable rules in accordance with the Trustee's
customary practices for action by or at a meeting of Securityholders. The Paying
Agent or Registrar may make reasonable rules and set reasonable requirements for
its functions.
SECTION 11.07. Legal Holidays.
If a payment date is a Legal Holiday at such place, payment may be made at
such place on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue for the intervening period.
SECTION 11.08. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW. THE PARTIES HERETO AGREE TO IRREVOCABLY SUBMIT TO THE
JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS INDENTURE AND THE SECURITIES, AND IRREVOCABLY ACCEPT FOR
THEMSELVES AND IN RESPECT OF THEIR PROPERTY, GENERALLY AND UNCONDITIONALLY,
JURISDICTION OF THE AFORESAID COURTS. THE PARTIES HERETO IRREVOCABLY WAIVE, TO
THE FULLEST EXTENT THEY MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL BY
JURY AND ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE
VENUE OR THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
THE TRUSTEE OR ANY HOLDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN ANY
OTHER JURISDICTION.
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SECTION 11.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or any of its Subsidiaries, except to the extent
necessary to interpret the meanings of provisions or defined terms specifically
incorporated by reference. Any such indenture, loan or debt agreement may not be
used to interpret this Indenture, except to the extent necessary to interpret
the meanings of provisions or defined terms specifically incorporated by
reference.
SECTION 11.10. No Recourse Against Others.
A director, officer, employee, stockholder or Affiliate, as such, of the
Company and each of its Subsidiaries shall not have any liability for any
obligations of the Company under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. Such waiver and release are part of the consideration for the
issuance of the Securities.
SECTION 11.11. Successors.
All agreements of the Company in this Indenture and the Securities shall
bind its successors and assigns. All agreements of the Trustee in this Indenture
shall bind its successors and assigns.
SECTION 11.12. Counterparts.
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be and original and all of which taken together shall constitute one
and the same agreement.
SECTION 11.13. Severability.
In case any provision in this Indenture or in the Securities shall be held
invalid, illegal or unenforceable, in any respect for any reason, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby; it being intended that all of the provisions
hereof shall be enforceable to the full extent of the law.
SECTION 11.14. Table of Contents, Headings. Etc.
The table of contents, cross-reference sheet and headings of the Articles
and Sections of this Indenture have been inserted for convenience of reference
only, and are not to be considered a part hereof, and shall in no way modify or
restrict any of the terms or provisions hereof.
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SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the date first written above.
HEADWAY CORPORATE
RESOURCES, INC., as Issuer
By: /s/
STATE STREET BANK AND TRUST COMPANY,
N.A., as Trustee
By: /s/
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