EXHIBIT 4.6
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RENT-A-CENTER, INC.,
as Issuer
COLORTYME, INC.
and
ADVANTAGE COMPANIES, INC.,
as Subsidiary Guarantors
and
THE BANK OF NEW YORK,
as Trustee
----------
INDENTURE
Dated as of December 19, 2001
----------
Series C and Series D
11% Senior Subordinated Notes due 2008
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RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT
OF 1939 AND INDENTURE, DATED AS OF DECEMBER 19, 2001
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
Section 310(a)(1) .................................................... 608
(a)(2) .................................................... 608
(b) .................................................... 609
Section 312(a) .................................................... 701
(c) .................................................... 702
Section 313(a) .................................................... 703
(c) .................................................... 703
Section 314(a)(4) .................................................... 1018(a)
(c)(1) .................................................... 102
(c)(2) .................................................... 102
(e) .................................................... 102
Section 315(a) .................................................... 601(a)
(b) .................................................... 602
(c) .................................................... 601(b)
(d) .................................................... 601(c), 603
316(a)(last sentence) .................................................... 101 ("Outstanding")
(a)(1)(A) .................................................... 502, 512
(a)(1)(B) .................................................... 513
(b) .................................................... 508
(c) .................................................... 104(d)
Section 317(a)(1) .................................................... 503
(a)(2) .................................................... 504
(b) .................................................... 1003
Section 318(a) .................................................... 111
TABLE OF CONTENTS
Page
ARTICLE ONE. DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION............................................2
SECTION 101. Definitions...............................................................................2
SECTION 102. Compliance Certificates and Opinions.....................................................22
SECTION 103. Form of Documents Delivered to Trustee...................................................23
SECTION 104. Acts of Holders..........................................................................23
SECTION 105. Notices, Etc., to Trustee, the Company and any Guarantor.................................24
SECTION 106. Notice to Holders; Waiver................................................................25
SECTION 107. Effect of Headings and Table of Contents.................................................25
SECTION 108. Successors and Assigns...................................................................25
SECTION 109. Separability Clause......................................................................25
SECTION 110. Benefits of Indenture....................................................................25
SECTION 111. Governing Law............................................................................26
SECTION 112. Legal Holidays...........................................................................26
SECTION 113. No Personal Liability of Directors, Officers, Employees, Stockholders or Incorporators...26
SECTION 114. Counterparts.............................................................................26
SECTION 115. Communications by Holders with Other Holders.............................................27
ARTICLE TWO. SECURITY FORMS....................................................................................27
SECTION 201. Forms Generally..........................................................................27
SECTION 202. Restrictive Legends......................................................................28
SECTION 203. Form of Series C Notes...................................................................31
SECTION 204. Form of Series D Notes...................................................................45
SECTION 205. Form of Trustee's Certificate of Authentication..........................................58
ARTICLE THREE. THE SECURITIES...................................................................................59
SECTION 301. Title and Terms..........................................................................59
SECTION 302. Denominations............................................................................59
SECTION 303. Execution, Authentication, Delivery and Dating...........................................60
SECTION 304. Temporary Securities.....................................................................61
SECTION 305. Registration, Registration of Transfer and Exchange......................................61
SECTION 306. Book-Entry Provisions for Global Notes...................................................63
SECTION 307. Special Transfer Provisions..............................................................64
SECTION 308. Form of Certificate to Be Delivered in Connection with Transfers to
Institutional Accredited Investors.......................................................66
SECTION 309. Form of Certificate to Be Delivered in Connection with Transfers
Pursuant to Regulation S.................................................................68
SECTION 310. Mutilated, Destroyed, Lost and Stolen Securities.........................................69
SECTION 311. Payment of Interest; Interest Rights Preserved...........................................70
SECTION 312. Persons Deemed Owners....................................................................71
SECTION 313. Cancellation.............................................................................71
SECTION 314. Computation of Interest..................................................................71
SECTION 315. CUSIP Numbers............................................................................72
ARTICLE FOUR. SATISFACTION AND DISCHARGE.......................................................................72
SECTION 401. Satisfaction and Discharge of
Indenture..................................................72
SECTION 402. Application of Trust Money...............................................................73
ARTICLE FIVE. REMEDIES.........................................................................................74
SECTION 501. Events of Default........................................................................74
SECTION 502. Acceleration of Maturity; Rescission and Annulment.......................................76
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee..........................76
SECTION 504. Trustee May File Proofs of Claim.........................................................77
SECTION 505. Trustee May Enforce Claims Without Possession of Securities..............................78
SECTION 506. Application of Money Collected...........................................................78
SECTION 507. Limitation on Suits......................................................................78
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest................79
SECTION 509. Restoration of Rights and Remedies.......................................................79
SECTION 510. Rights and Remedies Cumulative...........................................................79
SECTION 511. Delay or Omission Not Waiver.............................................................80
SECTION 512. Control by Holders.......................................................................80
SECTION 513. Waiver of Past Defaults..................................................................80
SECTION 514. Waiver of Stay or Extension Laws.........................................................81
SECTION 515. Undertaking for Costs....................................................................81
ARTICLE SIX. THE TRUSTEE.......................................................................................82
SECTION 601. Certain Duties and Responsibilities......................................................82
SECTION 602. Notice of Defaults.......................................................................83
SECTION 603. Certain Rights of Trustee................................................................83
SECTION 604. Trustee Not Responsible for Recitals or Issuance of Securities...........................85
SECTION 605. May Hold Securities......................................................................85
SECTION 606. Money Held in Trust......................................................................85
SECTION 607. Compensation and Reimbursement...........................................................85
SECTION 608. Corporate Trustee Required; Eligibility..................................................86
SECTION 609. Resignation and Removal; Appointment of Successor........................................86
SECTION 610. Acceptance of Appointment by Successor...................................................88
SECTION 611. Merger, Conversion, Consolidation or Succession to Business..............................88
SECTION 612. Trustee's Application for Instructions from the Company..................................89
ARTICLE SEVEN. HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY................................................89
SECTION 701. Company to Furnish Trustee Names and Addresses...........................................89
SECTION 702. Disclosure of Names and Addresses of Holders.............................................89
SECTION 703. Reports by Trustee.......................................................................89
SECTION 704. Notice of Defaults.......................................................................90
ARTICLE EIGHT. MERGER AND CONSOLIDATION........................................................................90
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.....................................90
SECTION 802. Successor Substituted....................................................................91
ARTICLE NINE. SUPPLEMENTS AND AMENDMENTS TO
INDENTURE.........................................................91
SECTION 901. Supplemental
Indentures Without Consent of Holders.......................................91
SECTION 902. Supplemental
Indentures with Consent of Holders..........................................92
SECTION 903. Execution of Supplemental Indentures.....................................................93
SECTION 904. Effect of Supplemental Indentures........................................................93
SECTION 905. Conformity with Trust Indenture Act......................................................94
SECTION 906. Reference in Securities to Supplemental Indentures.......................................94
SECTION 907. Notice of Supplemental Indentures........................................................94
SECTION 908. Effect on Senior Indebtedness............................................................94
ARTICLE TEN. COVENANTS.......................................................................................94
SECTION 1001. Payment of Principal, Premium, if any, and Interest.....................................94
SECTION 1002. Maintenance of Office or Agency.........................................................94
SECTION 1003. Money for Security Payments to Be Held in Trust.........................................95
SECTION 1004. Corporate Existence.....................................................................96
SECTION 1005. Payment of Taxes and Other Claims.......................................................96
SECTION 1006. Maintenance of Properties...............................................................97
SECTION 1007. Insurance...............................................................................97
SECTION 1008. Compliance with Laws....................................................................97
SECTION 1009. Limitation on Restricted Payments.......................................................97
SECTION 1010. Limitation on Indebtedness..............................................................99
SECTION 1011. Limitation on Layering.................................................................101
SECTION 1012. Limitation on Affiliate Transactions...................................................101
SECTION 1013. Limitation on Restrictions on Distributions from Restricted Subsidiaries...............102
SECTION 1014. Limitation on Sale or Issuance of Preferred Stock of Restricted Subsidiaries...........103
SECTION 1015. Limitation on Liens....................................................................103
SECTION 1016. Change of Control......................................................................103
SECTION 1017. Limitation on Sales of Assets..........................................................104
SECTION 1018. Statement by Officers as to Default....................................................106
SECTION 1019. Reporting Requirements.................................................................106
SECTION 1020. Future Subsidiary Guarantors...........................................................107
SECTION 1021. Designation of Unrestricted Subsidiaries...............................................107
SECTION 1022. Limitation on Sale/Leaseback Transactions..............................................107
ARTICLE ELEVEN. REDEMPTION OF SECURITIES......................................................................108
SECTION 1101. Optional Redemption....................................................................108
SECTION 1102. Applicability of Article...............................................................108
SECTION 1103. Election to Redeem; Notice to Trustee..................................................108
SECTION 1104. Selection by Trustee of Securities to Be Redeemed......................................108
SECTION 1105. Notice of Redemption...................................................................109
SECTION 1106. Deposit of Redemption Price............................................................110
SECTION 1107. Securities Payable on Redemption Date..................................................110
SECTION 1108. Securities Redeemed in Part............................................................110
ARTICLE TWELVE. LEGAL DEFEASANCE AND COVENANT DEFEASANCE..........................................................111
SECTION 1201. Company's Option to Effect Legal Defeasance or Covenant Defeasance.........................111
SECTION 1202. Legal Defeasance and Discharge.............................................................111
SECTION 1203. Covenant Defeasance........................................................................111
SECTION 1204. Conditions to Legal Defeasance or Covenant Defeasance......................................112
SECTION 1205. Deposited Money and Government Obligations to Be Held in Trust; Other Miscellaneous
Provisions.................................................................................114
SECTION 1206. Reinstatement..............................................................................114
ARTICLE THIRTEEN. SUBORDINATION OF SECURITIES.......................................................................114
SECTION 1301. Securities Subordinate to Senior Indebtedness..............................................114
SECTION 1302. Payment over of Proceeds upon Dissolution, Etc.............................................115
SECTION 1303. Suspension of Payment When Senior Indebtedness in Default..................................115
SECTION 1304. Acceleration of Securities.................................................................116
SECTION 1305. When Distribution Must Be Paid Over........................................................116
SECTION 1306. Notice by Company..........................................................................117
SECTION 1307. Payment Permitted if No Default............................................................117
SECTION 1308. Subrogation to Rights of Holders of Senior Indebtedness....................................117
SECTION 1309. Provisions Solely to Define Relative Rights................................................117
SECTION 1310. Trustee to Effectuate Subordination........................................................118
SECTION 1311. Subordination May Not Be Impaired by Company...............................................118
SECTION 1312. Distribution or Notice to Representative...................................................118
SECTION 1313. Notice to Trustee..........................................................................118
SECTION 1314. Reliance on Judicial Order or Certificate of Liquidating Agent.............................119
SECTION 1315. Rights of Trustee as a Holder of Senior Indebtedness; Preservation of Trustee's Rights.....119
SECTION 1316. Article Applicable to Paying Agents........................................................120
SECTION 1317. No Suspension of Remedies..............................................................120
SECTION 1318. Modification of Terms of Senior Indebtedness...........................................120
SECTION 1319. Trust Moneys Not Subordinated..........................................................120
SECTION 1320. Trustee Not Fiduciary for Holders of Senior Indebtedness...............................121
ARTICLE FOURTEEN. SUBSIDIARY GUARANTEES.......................................................................121
SECTION 1401. Subsidiary Guarantees..................................................................121
SECTION 1402. Limitation on Liability................................................................123
SECTION 1403. No Waiver..............................................................................123
SECTION 1404. Modification...........................................................................123
SECTION 1405. Release of Subsidiary Guarantor........................................................123
INDENTURE, dated as of December 19, 2001, among RENT-A-CENTER,
INC., a Delaware corporation (the "Company"), having its principal office at
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, COLORTYME, INC., a Texas
corporation ("ColorTyme"), having its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ADVANTAGE COMPANIES,INC., a Delaware
corporation ("Advantage", and together with ColorTyme, the "Subsidiary
Guarantors") having its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, and The Bank of
New York, a
New York banking corporation, as
trustee (the "Trustee"), having its Corporate Trust Office at ▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
RECITALS OF THE COMPANY
The Company has duly authorized the creation of and issuance
of (i) the Company's 11% Senior Subordinated Notes due 2008, Series C (the
"Series C Notes"), (ii) if and when issued in exchange for the Series C Notes as
provided in a Registration Rights Agreement (as defined herein) and the Existing
Notes (as defined herein), the Company's 11% Senior Subordinated Notes due 2008,
Series D (the "Series D Notes"), and (iii) if and when issued pursuant to a
private exchange for Series C Notes and the Existing Notes, the Company's 11%
Senior Subordinated Notes due 2008, Series D (the "Private Series D Notes", and
together with the Series C Notes, the Existing Notes and the Series D Notes, the
"Securities"), of substantially the tenor and amount hereinafter set forth, and
to provide therefor the Company and each Subsidiary Guarantor has duly
authorized the execution and delivery of this Indenture.
Upon the issuance of the Series D Notes or the Private Series
D Notes, if any, or the effectiveness of the Shelf Registration Statement (as
defined herein), this Indenture will be subject to, and shall be governed by,
the provisions of the Trust Indenture Act of 1939, as amended, that are required
or deemed to be part of and to govern indentures qualified thereunder.
All things necessary have been done to make the Securities,
when executed and duly issued by the Company and the Subsidiary Guarantors and
authenticated and delivered hereunder by the Trustee or the Authenticating
Agent, the valid and legally binding obligations of the Company and the
Subsidiary Guarantors and to make this Indenture a valid and legally binding
agreement of the Company and the Subsidiary Guarantors in accordance with their
and its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities, as
follows:
2
ARTICLE ONE.
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article, and words in the singular include the
plural as well as the singular, and words in the plural include the
singular as well as the plural;
(b) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, or defined by
Commission rule and not otherwise defined herein have the meanings
assigned to them therein, and the terms "cash transaction" and
"self-liquidating paper", as used in TIA Section 311, shall have the
meanings assigned to them in the rules of the Commission adopted under
the Trust Indenture Act;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP (as defined herein);
(d) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision;
(e) the word "or" is not exclusive; and
(f) provisions of this Indenture apply to successive events
and transactions.
Certain terms, used principally in Articles Two, Ten, Twelve
and Thirteen, are defined in those Articles.
"Additional Assets" means (i) any property or assets (other
than Indebtedness and Capital Stock) to be used by the Company or a Restricted
Subsidiary in a Related Business; (ii) the Capital Stock of a Person that
becomes a Restricted Subsidiary as a result of the acquisition of such Capital
Stock by the Company or another Restricted Subsidiary; (iii) Capital Stock of
any Person that at such time is a Restricted Subsidiary, acquired from a third
party; provided, however, that, in the case of clauses (ii) and (iii), such
Restricted Subsidiary is primarily engaged in a Related Business; or (iv)
Capital Stock or Indebtedness of any Person which is primarily engaged in a
Related Business; provided, however, for purposes of the covenant described
under Section 1017, the aggregate amount of Net Available Cash permitted to be
invested pursuant to this clause (iv) shall not exceed at any one time
outstanding 5% of Consolidated Tangible Assets.
"Affiliate" of any specified Person means any other Person,
directly or indirectly, controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any Person
3
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing. JPMorgan and its Affiliates shall not be deemed an
Affiliate of the Company.
"Apollo" means Apollo Management IV, L.P., and its Affiliates
or any entity controlled thereby or any of the partners thereof.
"Asset Disposition" means any sale, lease, transfer or other
disposition of shares of Capital Stock of a Restricted Subsidiary (other than
directors' qualifying shares), property or other assets (each referred to for
the purposes of this definition as a "disposition") by the Company or any of its
Restricted Subsidiaries (including any disposition by means of a merger,
consolidation or similar transaction) other than (i) a disposition by a
Restricted Subsidiary to the Company or by the Company or a Restricted
Subsidiary to a Restricted Subsidiary, (ii) a disposition of inventory,
equipment, obsolete assets or surplus personal property in the ordinary course
of business, (iii) the sale of Temporary Cash Investments or Cash Equivalents in
the ordinary course or business, (iv) a transaction or a series of related
transactions in which either (x) the fair market value of the assets disposed
of, in the aggregate, does not exceed 2.5% of the Consolidated Tangible Assets
of the Company or (y) the EBITDA related to such assets does not, in the
aggregate, exceed 2.5% of the Company's EBITDA, (v) the sale or discount (with
or without recourse, and on commercially reasonable terms) of accounts
receivable or notes receivable arising in the ordinary course of business, or
the conversion or exchange of accounts receivable for notes receivable, (vi) the
licensing of intellectual property in the ordinary course of business, (vii) an
RTO Facility Swap, (viii) for purposes of the covenant contained in Section 1017
only, a disposition subject to the covenant contained in Section 1009 or (ix) a
disposition of property or assets that is governed by the provisions of Article
8.
"Attributable Debt" in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the
interest rate assumed in making calculations in accordance with FAS 13) 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).
"Average Life" means, as of the date of determination, with
respect to any Indebtedness or Preferred Stock, the quotient obtained by
dividing (i) the sum of the products of the numbers of years from the date of
determination to the dates of each successive scheduled principal payment of
such Indebtedness or redemption or similar payment with respect to such
Indebtedness or Preferred Stock multiplied by the amount of such payment by (ii)
the sum of all such payments.
"Bank Indebtedness" means any and all amounts, whether
outstanding on the date of the Existing Indenture or thereafter Incurred,
payable under or in respect of the Senior Credit Facility, including, without
limitation, principal, premium (if any), interest (including interest accruing
on or after the filing of any petition in bankruptcy or for reorganization
relating to the Company or any Restricted Subsidiary whether or not a claim for
postfiling interest is allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, guarantees, other
4
monetary obligations of any nature and all other amounts payable thereunder or
in respect thereof.
"Board of Directors" means the Board of Directors of the
Company or any committee thereof duly authorized to act on behalf of such Board.
"Board Resolution" means a copy of a resolution, certified by
the appropriate officer of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day" means a day other than a Saturday, Sunday or
other day on which commercial banking institutions are authorized or required by
law to close in
New York City.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) equity of such Person,
including any Preferred Stock, but excluding any debt securities convertible
into such equity.
"Capitalized Lease Obligation" means an obligation that is
required to be classified and accounted for as a capitalized lease for financial
reporting purposes in accordance with GAAP, and the amount of Indebtedness
represented by such obligation shall be the capitalized amount of such
obligation determined in accordance with GAAP; and the Stated Maturity thereof
shall be the date of the last payment of rent or any other amount due under such
lease.
"Cash Equivalents" means any of the following: (i) securities
issued or fully guaranteed or insured by the United States Government or any
agency or instrumentality thereof, (ii) time deposits, certificates of deposit
or bankers' acceptances of (A) any lender under the Senior Credit Agreement or
(B) any commercial bank having capital and surplus in excess of $500,000,000 and
the commercial paper of the holding company of which is rated at least "A-2" or
the equivalent thereof by S&P or at least "P-2" or the equivalent thereof by
▇▇▇▇▇'▇ (or if at such time neither is issuing ratings, then a comparable rating
of another nationally recognized rating agency), (iii) commercial paper rated at
least "A-1" or the equivalent thereof by S&P or at least "P-1" or the equivalent
thereof by ▇▇▇▇▇'▇ (or if at such time neither is issuing ratings, then a
comparable rating of another nationally recognized rating agency), (iv)
investments in money market funds complying with the risk limiting conditions of
Rule 2a-7 or any successor rule of the SEC under the Investment Company Act, (v)
repurchase obligations of any commercial bank satisfying the requirements of
clause (ii) of this definition, having a term of not more than 30 days, with
respect to securities issued or fully guaranteed or insured by the United States
Government, (vi) securities with maturities of one year or less from the date of
acquisition, issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of such
state, commonwealth or territory or by any foreign government, the securities of
which state, commonwealth, territory, political subdivision, taxing authority or
foreign government, as the case may be, are rated at least "A" by S&P or "A" by
▇▇▇▇▇'▇, and (vii) securities with maturities of six months or less from the
date of acquisition backed by standby letters of credit issued by any commercial
bank satisfying the requirements of clause (ii) of this definition.
5
"Central Acquisition" means the Company's acquisition of
substantially all of the assets of Central Rents, Inc.
"Change of Control" means (i) any "Person" (as such term is
used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more
Permitted Holders, is or becomes the beneficial owner (as defined in Rules 13d-3
and 13d-5 under the Exchange Act except that a Person shall be deemed to have
"beneficial ownership" of all shares that any such Person has the right to
acquire within one year) directly or indirectly, of more than 50% of the Voting
Stock of the Company or a Successor Company (as defined below) (including,
without limitation, through a merger or consolidation or purchase of Voting
Stock of the Company); provided that, the Permitted Holders do not have the
right or ability by voting power, contract or otherwise to elect or designate
for election a majority of the Board of Directors; provided further that, the
transfer of 100% of the voting stock of the Company to a Person that has an
ownership structure identical to that of the Company prior to such transfer,
such that the Company becomes a Wholly Owned Subsidiary of such Person, shall
not be treated as a Change of Control for purposes of this Indenture; (ii)
during any period of two consecutive years, individuals who at the beginning of
such period constituted the Board of Directors (together with any new directors
whose election by such Board of Directors or whose nomination for election by
the shareholders of the Company was approved by a vote of a majority of the
directors of the Company then still in office who were either directors at the
beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board of Directors then in office; (iii) the sale, lease, transfer, conveyance
or other disposition (other than by way of merger or consolidation), in one or a
series of related transactions, of all or substantially all of the assets of the
Company and its Restricted Subsidiaries taken as a whole to any Person or group
of related Persons (a "Group") (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act) other than a Permitted Holder; or (iv) the adoption of a
plan relating to the liquidation or dissolution of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means Rent-A-Center, Inc., a Delaware corporation.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by an Officer of the Company with
actual authority to bind the Company on such matters, and delivered to the
Trustee.
"Consolidated Coverage Ratio" as of any date of determination
means the ratio of (i) the aggregate amount of EBITDA of the Company and its
Restricted Subsidiaries for the period of the most recent four consecutive
fiscal quarters ending prior to the date of such determination for which
consolidated financial statements of the Company are available to (ii)
Consolidated Interest Expense for such four fiscal quarters (in each of clause
(i) and (ii), determined, for each fiscal quarter (or portion thereof) of the
four fiscal quarters ending prior to the date of the Existing Indenture, on a
pro forma basis to give effect to the Central Acquisition and the Transactions
(including the anticipated disposition of any non-rent-to-own businesses under
contract for sale or held for sale following the date of the Existing Indenture)
as if they had occurred at the beginning of such four-quarter period); provided,
however, that: (1) if the Company or any Restricted Subsidiary (x) has Incurred
any Indebtedness since the beginning of
6
such period that remains outstanding on such date of determination or if the
transaction giving rise to the need to calculate the Consolidated Coverage Ratio
is an Incurrence of Indebtedness, EBITDA and Consolidated Interest Expense for
such period shall be calculated after giving effect on a pro forma basis to such
Indebtedness as if such Indebtedness had been Incurred on the first day of such
period (except that in making such computation, the amount of Indebtedness under
any revolving credit facility outstanding on the date of such calculation shall
be computed based on (A) the average daily balance of such Indebtedness during
such four fiscal quarters or such shorter period for which such facility was
outstanding or (B) if such facility was created after the end of such four
fiscal quarters, the average daily balance of such Indebtedness during the
period from the date of creation of such facility to the date of such
calculation) and the discharge of any other Indebtedness repaid, repurchased,
defeased or otherwise discharged with the proceeds of such new Indebtedness as
if such discharge had occurred on the first day of such period, or (y) has
repaid, repurchased, defeased or otherwise discharged any Indebtedness since the
beginning of the period that is no longer outstanding on such date of
determination, or if the transaction giving rise to the need to calculate the
Consolidated Coverage Ratio involves a discharge of Indebtedness (in each case
other than Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid), EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving effect on a pro forma
basis to such discharge of such Indebtedness, including with the proceeds of
such new Indebtedness, as if such discharge had occurred on the first day of
such period; (2) if since the beginning of such period the Company or any
Restricted Subsidiary shall have made any Asset Disposition of any company or
any business or any group of assets, the EBITDA for such period shall be reduced
by an amount equal to the EBITDA (if positive) directly attributable to the
assets that are the subject of such Asset Disposition for such period or
increased by an amount equal to the EBITDA (if negative) directly attributable
thereto for such period and Consolidated Interest Expense for such period shall
be reduced by an amount equal to the Consolidated Interest Expense directly
attributable to any Indebtedness of the Company or any Restricted Subsidiary
repaid, repurchased, defeased or otherwise discharged with respect to the
Company and its continuing Restricted Subsidiaries in connection with such Asset
Disposition for such period (and, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period directly
attributable to the Indebtedness of such Restricted Subsidiary to the extent the
Company and its continuing Restricted Subsidiaries are no longer liable for such
Indebtedness after such sale); (3) if since the beginning of such period the
Company or any Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Person that thereby becomes a Restricted Subsidiary, or
otherwise acquired any company or any business or any group of assets, including
any such acquisition of assets occurring in connection with a transaction
causing a calculation to be made hereunder, EBITDA and Consolidated Interest
Expense for such period shall be calculated after giving pro forma effect
thereto (including the Incurrence of any Indebtedness and including the pro
forma expenses and cost reductions calculated on a basis consistent with
Regulation S-X of the Securities Act) as if such Investment or acquisition
occurred on the first day of such period; and (4) if since the beginning of such
period any Person (that subsequently became a Restricted Subsidiary or was
merged with or into the Company or any Restricted Subsidiary since the beginning
of such period) shall have made any Asset Disposition or any Investment or
acquisition of assets that would have required an adjustment pursuant to clause
(2) or (3) above if made by the Company or a Restricted Subsidiary during such
period, EBITDA and Consolidated Interest Expense for such period shall
7
be calculated after giving pro forma effect thereto as if such Asset
Disposition, Investment or acquisition of assets occurred on the first day of
such period.
For purposes of this definition, whenever pro forma effect is
to be given to an Asset Disposition, Investment or acquisition of assets, or any
transaction governed by the provisions of Article 8, or the amount of income or
earnings relating thereto and the amount of Consolidated Interest Expense
associated with any Indebtedness Incurred or repaid, repurchased, defeased or
otherwise discharged in connection therewith, the pro forma calculations in
respect thereof shall be as determined in good faith by a responsible financial
or accounting officer of the Company, based on reasonable assumptions. If any
Indebtedness bears a floating rate of interest and is being given pro forma
effect, the interest expense on such Indebtedness shall be calculated at a fixed
rate as if the rate in effect on the date of determination had been the
applicable rate for the entire period (taking into account any Interest Rate
Agreement applicable to such Indebtedness if such Interest Rate Agreement has a
remaining term as at the date of determination in excess of 12 months). If any
Indebtedness bears, at the option of the Company or a Restricted Subsidiary, a
fixed or floating rate of interest and is being given pro forma effect, the
interest expense on such Indebtedness shall be computed by applying, at the
option of the Company or such Restricted Subsidiary, either a fixed or floating
rate. If any Indebtedness which is being given pro forma effect was Incurred
under a revolving credit facility, the interest expense on such Indebtedness
shall be computed based upon the average daily balance of such Indebtedness
during the applicable period.
"Consolidated Interest Expense" means, as to any Person, for
any period, the total consolidated interest expense of such Person and its
Subsidiaries determined in accordance with GAAP, minus, to the extent included
in such interest expense, amortization or write-off of financing costs, plus, to
the extent incurred by such Person and its Subsidiaries in such period but not
included in such interest expense, without duplication, (i) interest expense
attributable to Capitalized Lease Obligations and the interest component of rent
expense associated with Attributable Debt in respect of the relevant lease
giving rise thereto, determined as if such lease were a capitalized lease, in
accordance with GAAP, (ii) amortization of debt discount, (iii) interest in
respect of Indebtedness of any other Person that has been Guaranteed by such
Person or any Subsidiary, but only to the extent that such interest is actually
paid by such Person or any Restricted Subsidiary, (iv) non-cash interest
expense, (v) net costs associated with Hedging Obligations, (vi) the product of
(A) mandatory Preferred Stock cash dividends in respect of all Preferred Stock
of Subsidiaries of such Person and Disqualified Stock of such Person held by
Persons other than such Person or a Subsidiary multiplied by (B) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current combined Federal, state and local statutory tax rate of such Person,
expressed as a decimal, in each case, determined on a consolidated basis in
accordance with GAAP; and (vii) the cash contributions to any employee stock
ownership plan or similar trust to the extent such contributions are used by
such plan or trust to pay interest to any Person (other than the referent Person
or any Subsidiary thereof) in connection with Indebtedness Incurred by such plan
or trust; provided, however, that as to the Company, there shall be excluded
therefrom any such interest expense of any Unrestricted Subsidiary to the extent
the related Indebtedness is not Guaranteed or paid by the Company or any
Restricted Subsidiary. For purposes of the foregoing, gross interest expense
shall be determined after giving effect to any net payments made or received by
such Person and its Subsidiaries with respect to Interest Rate Agreements.
8
"Consolidated Net Income" means, as to any Person, for any
period, the consolidated net income (loss) of such Person and its Subsidiaries
before preferred stock dividends, determined in accordance with GAAP; provided,
however, that there shall not be included in such Consolidated Net Income: (i)
any net income (loss) of any Person if such Person is not (as to the Company) a
Restricted Subsidiary and (as to any other Person) an unconsolidated Person,
except that (A) subject to the limitations contained in clause (iv) below, the
referent Person's equity in the net income of any such Person for such period
shall be included in such Consolidated Net Income up to the aggregate amount of
cash actually distributed by such Person during such period to the referent
Person or a Subsidiary as a dividend or other distribution (subject, in the case
of a dividend or other distribution to a Subsidiary, to the limitations
contained in clause (iii) below) and (B) the net loss of such Person shall be
included to the extent of the aggregate Investment of the referent Person or any
of its Subsidiaries in such Person; (ii) any net income (loss) of any Person
acquired in a pooling of interests transaction for any period prior to the date
of such acquisition; (iii) any net income (loss) of any Restricted Subsidiary
(as to the Company) or of any Subsidiary (as to any other Person) if such
Subsidiary is subject to restrictions, directly or indirectly, on the payment of
dividends or the making of distributions by such Subsidiary, directly or
indirectly, to the Company, except that (A) subject to the limitations contained
in (iv) below, such Person's equity in the net income of any such Subsidiary for
such period shall be included in Consolidated Net Income up to the aggregate
amount of cash that could have been distributed by such Subsidiary during such
period to such Person or another Subsidiary as a dividend (subject, in the case
of a dividend that could have been made to another Restricted Subsidiary, to the
limitation contained in this clause) and (B) the net loss of such Subsidiary
shall be included in determining Consolidated Net Income; (iv) any charges for
costs and expenses associated with the Transactions; (v) any extraordinary gain
or loss and (vi) the cumulative effect of a change in accounting principles.
"Consolidated Tangible Assets" means, as of any date of
determination, the total assets, less goodwill and other intangibles (other than
patents, trademarks, copyrights, licenses and other intellectual property),
shown on the balance sheet of the Company and its Restricted Subsidiaries as of
the most recent date for which such a balance sheet is available, determined on
a consolidated basis in accordance with GAAP less all write-ups (other than
write-ups in connection with acquisitions) subsequent to the date of this
Indenture in the book value of any asset (except any such intangible assets)
owned by the Company or any of its Restricted Subsidiaries.
"Consolidation" means the consolidation of the accounts of
each of the Restricted Subsidiaries with those of the Company in accordance with
GAAP; provided, however, that "Consolidation" will not include consolidation of
the accounts of any Unrestricted Subsidiary, but the interest of the Company in
any Unrestricted Subsidiary will be accounted for as an Investment. The term
"Consolidated" has a correlative meaning.
"Convertible Preferred Stock" means (i) the convertible
preferred stock of the Company issued to Apollo, resulting in gross proceeds to
the Company of $250 million, and (ii) the convertible preferred stock of the
Company issued to an Affiliate of Bear, ▇▇▇▇▇▇▇ & Co. on August 18, 1998.
9
"Currency Agreement" means in respect of a Person any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement (including derivative agreements or arrangements) as to which such
Person is a party or a beneficiary.
"Default" means any event or condition that is, or after
notice or passage of time or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees
and their respective successors and assigns, or such other depository
institution hereinafter appointed by the Company.
"Designated Senior Indebtedness" means (i) the Bank
Indebtedness and (ii) any other Senior Indebtedness which, at the date of
determination, has an aggregate principal amount of, or under which, at the date
of determination, the holders thereof are committed to lend up to, at least
$25.0 million and is specifically designated by the Company in the instrument
evidencing or governing such Senior Indebtedness as "Designated Senior
Indebtedness" for purposes of this Indenture.
"Disqualified Stock" means, with respect to any Person, any
Capital Stock (excluding the Convertible Preferred Stock) that by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable or exercisable) or upon the happening of any event (i) matures or
is mandatorily redeemable pursuant to a sinking fund obligation or otherwise,
(ii) is convertible or exchangeable for Indebtedness or Disqualified Stock or
(iii) is redeemable at the option of the holder thereof, in whole or in part, in
the case of clauses (i), (ii) and (iii), on or prior to the 91st day after the
Stated Maturity of the Securities.
"EBITDA" means, as to any Person, for any period, the
Consolidated Net Income for such period, plus the following to the extent
included in calculating such Consolidated Net Income: (i) income tax expense,
(ii) Consolidated Interest Expense, (iii) depreciation expense (other than
depreciation expense relating to rental merchandise), (iv) amortization expense,
and (v) other non-cash charges or non-cash losses, and minus any gain (but not
loss) realized upon the sale or other disposition of any asset of the Company or
its Restricted Subsidiaries (including pursuant to any Sale/Leaseback
Transaction) that is not sold or otherwise disposed of in the ordinary course of
business.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Existing Indenture" means that certain indenture, dated as of
August 18, 1998, as amended to the date hereof, among the Company, Subsidiary
Guarantors and The Bank of
New York as successor to IBJ ▇▇▇▇▇▇▇▇ Bank & Trust
Company, as Trustee.
"Existing Notes" means the Company's 11% Senior Subordinated
Notes due 2008 issued pursuant to the Existing Indenture.
"GAAP" means generally accepted accounting principles in the
United States of America as in effect on the date of the Existing Indenture (for
purposes of the definitions of the terms "Consolidated Coverage Ratio,"
"Consolidated Interest Expense," "Consolidated Net Income" and "EBITDA," all
defined terms in this Indenture to the extent used in or relating to
10
any of the foregoing definitions, and all ratios and computations based on any
of the foregoing definitions) and as in effect from time to time (for all other
purposes of this Indenture), including 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
approved by a significant segment of the accounting profession. All ratios and
computations based on GAAP contained in this Indenture shall be computed in
conformity with GAAP.
"Guarantee" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any Indebtedness or other
nonfinancial obligation of any other Person, including any such obligation,
direct or indirect, contingent or otherwise, of such Person (i) to purchase or
pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or such other obligation of such other Person (whether arising by
virtue of partnership arrangements, or by agreement to keep-well, to purchase
assets, goods, securities or services, to take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such Indebtedness or other obligation of the
payment thereof or to protect such obligee against loss in respect thereof (in
whole or in part); provided, however, that the term "Guarantee" shall not
include endorsements for collection, or deposits made, in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantor Senior Indebtedness" means, with respect to a
Subsidiary Guarantor, the following obligations, whether outstanding on the date
of this Indenture or thereafter Incurred, without duplication: (i) any Guarantee
of the Senior Credit Facility by such Subsidiary Guarantor and all other
Guarantees by such Subsidiary Guarantor of Senior Indebtedness of the Company or
Guarantor Indebtedness for any other Subsidiary Guarantor; and (ii) all
obligations consisting of the principal of and premium, if any, and accrued and
unpaid interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Subsidiary
Guarantor regardless of whether post filing interest is allowed in such
proceeding) on, and fees and other amounts owing in respect of, all other
Indebtedness of the Subsidiary Guarantor, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is
expressly provided that the obligations in respect of such Indebtedness are not
senior in right of payment to the obligations of such Subsidiary Guarantor under
the Subsidiary Guarantee; provided, however, that Guarantor Senior Indebtedness
will not include (1) any obligations of such Subsidiary Guarantor to another
Subsidiary Guarantor or any other Affiliate of the Subsidiary Guarantor or any
such Affiliate's Subsidiaries, (2) any liability for Federal, state, local,
foreign or other taxes owed or owing by such Subsidiary Guarantor, (3) any
accounts payable or other liability to trade creditors arising in the ordinary
course of business (including Guarantees thereof or instruments evidencing such
liabilities) or other current liabilities (other than current liabilities which
constitute Bank Indebtedness or the current portion of any long-term
Indebtedness which would constitute Senior Indebtedness but for the operation of
this clause (3), (4) any Indebtedness, Guarantee or obligation of such
Subsidiary Guarantor that is expressly subordinate or junior to any other
Indebtedness, Guarantee or obligation of such Subsidiary Guarantor, including
any Guarantor Senior Subordinated Indebtedness and Guarantor Subordinated
Obligations of such Subsidiary Guarantor, (5) Indebtedness which is represented
by redeemable Capital Stock or (6) that portion of any Indebtedness that is
Incurred in violation of this Indenture. If any Designated Senior
11
Indebtedness is disallowed, avoided or subordinated pursuant to the provisions
of Section 548 of Title 11 of the United States Code or any applicable state
fraudulent conveyance law, such Designated Senior Indebtedness nevertheless will
constitute Senior Indebtedness.
"Guarantor Senior Subordinated Indebtedness" means with
respect to a Subsidiary Guarantor, the obligations of such Subsidiary Guarantor
under the Subsidiary Guarantee and any other Indebtedness of such Subsidiary
Guarantor (whether outstanding on the date of the Existing Indenture or
thereafter Incurred) that specifically provides that such Indebtedness is to
rank pari passu in right of payment with the obligations of such Subsidiary
Guarantor under the Subsidiary Guarantee and is not expressly subordinated by
its terms in right of payment to any Indebtedness of such Subsidiary Guarantor
which is not Guarantor Senior Indebtedness of such Subsidiary Guarantor.
"Guarantor Subordinated Obligation" means, with respect to a
Subsidiary Guarantor, any Indebtedness of such Subsidiary Guarantor (whether
outstanding on the date of the Existing Indenture or thereafter Incurred) which
is expressly subordinated in right of payment to the obligations of such
Subsidiary Guarantor under its Subsidiary Guarantee pursuant to a written
agreement.
"Hedging Obligations" of any Person means the obligations of
such Person pursuant to any Interest Rate Agreement or Currency Agreement.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered in the Register.
"Incur" means issue, assume, enter into any Guarantee of,
incur or otherwise become liable for; provided, however, that any Indebtedness
or Capital Stock of a Person existing at the time such Person becomes a
Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be
deemed to be Incurred by such Subsidiary at the time it becomes a Subsidiary.
Any Indebtedness issued at a discount (including Indebtedness on which interest
is payable through the issuance of additional Indebtedness) shall be deemed
incurred at the time of original issuance of the Indebtedness at the initial
accreted amount thereof.
"Indebtedness" means, with respect to any Person on any date
of determination (without duplication): (i) the principal of indebtedness of
such Person for borrowed money, (ii) the principal of obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments, (iii) all
reimbursement obligations of such Person, including reimbursement obligations in
respect of letters of credit or other similar instruments (the amount of such
obligations being equal at any time to the aggregate then undrawn and unexpired
amount of such letters of credit or other instruments plus the aggregate amount
of drawings thereunder that have not then been reimbursed), (iv) all obligations
of such Person to pay the deferred and unpaid purchase price of property or
services (except Trade Payables), which purchase price is due more than one year
after the date of placing such property in final service or taking final
delivery and title thereto or the completion of such services, (v) all
Capitalized Lease Obligations and Attributable Debt of such Person, (vi) the
redemption, repayment or other repurchase amount of such Person with respect to
any Disqualified Stock or (if such Person is a Subsidiary of the Company) any
Preferred Stock of such Subsidiary, but excluding, in each case, any accrued
12
dividends (the amount of such obligation to be equal at any time to the maximum
fixed involuntary redemption, repayment or repurchase price for such Capital
Stock, or if such Capital Stock has no fixed price, to the involuntary
redemption, repayment or repurchase price therefor calculated in accordance with
the terms thereof as if then redeemed, repaid or repurchased, and if such price
is based upon or measured by the fair market value of such Capital Stock, such
fair market value shall be as determined in good faith by the Board of Directors
or the board of directors of the issuer of such Capital Stock), (vii) all
Indebtedness of other Persons secured by a Lien on any asset of such Person,
whether or not such Indebtedness is assumed by such Person; provided, however,
that the amount of Indebtedness of such Person shall be the lesser of (A) the
fair market value of such asset at such date of determination and (B) the amount
of such Indebtedness of such other Persons, (viii) all Indebtedness of other
Persons to the extent Guaranteed by such Person, and (ix) to the extent not
otherwise included in this definition, net Hedging Obligations of such Person
(such obligations to be equal at any time to the termination value of such
agreement or arrangement giving rise to such Hedging Obligation that would be
payable by such Person at such time).
The amount of Indebtedness of any Person at any date shall be
determined as set forth above or otherwise provided in this Indenture, or
otherwise in accordance with GAAP.
"Indenture" means this Indenture as amended or supplemented
from time to time.
"Interest Rate Agreement" means with respect to any Person any
interest rate protection agreement, interest rate future agreement, interest
rate option agreement, interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate hedge agreement or
other similar agreement or arrangement (including derivative agreement or
arrangements) as to which such Person is party or a beneficiary; provided,
however, any such agreements entered into in connection with the Securities
shall not be included.
"Investment" in any Person by any other Person means any
direct or indirect advance, loan or other extension of credit (other than to
customers, directors, officers or employees of any Person in the ordinary course
of business) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the account
or use of others), or any purchase or acquisition of Capital Stock, Indebtedness
or other similar instruments issued by, such Person. If the Company or any
Restricted Subsidiary of the Company sells or otherwise disposes of any Capital
Stock of any direct or indirect Restricted Subsidiary of the Company such that,
after giving effect to any such sale or disposition, such entity is no longer a
Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Capital Stock of such Subsidiary not sold or disposed of.
"JPMorgan" means JPMorgan Chase Bank.
"Lien" means any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement or lease in the nature thereof).
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its
successors.
13
"Net Available Cash" from an Asset Disposition means cash
payments received (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise,
but only as and when received, but excluding any other consideration received in
the form of assumption by the acquiring person of Indebtedness or other
obligations relating to the properties or assets that are the subject of such
Asset Disposition or received in any other noncash form) therefrom, in each case
net of (i) all legal, title and recording tax expenses, commissions and other
fees and expenses incurred (including, without limitation, fees and expenses of
legal counsel, accountants and financial advisors), and all Federal, state,
provincial, foreign and local taxes required to be paid or accrued as a
liability under GAAP, as a consequence of such Asset Disposition, (ii) all
payments made on any Indebtedness that is secured by any assets subject to such
Asset Disposition, in accordance with the terms of any Lien upon such assets, or
that must by its terms, or in order to obtain a necessary consent to such Asset
Disposition, or by applicable law be repaid out of the proceeds from such Asset
Disposition, (iii) all distributions and other payments required to be made to
minority interest holders in Subsidiaries or joint ventures as a result of such
Asset Disposition or to any other Person (other than the Company or any
Restricted Subsidiary) owning a beneficial interest in the assets disposed of in
such Asset Disposition and (iv) appropriate amounts to be provided by the seller
as a reserve, in accordance with GAAP, against any liabilities associated with
the assets disposed of in such Asset Disposition and retained by the Company or
any Restricted Subsidiary after such Asset Disposition.
"Net Cash Proceeds" means, with respect to any issuance or
sale of any securities of the Company or any Subsidiary by the Company or any
Subsidiary, or any capital contribution, the cash proceeds of such issuance,
sale or contribution net of attorneys' fees, accountants' fees, underwriters' or
placement agents' fees, discounts or commissions and brokerage, consultant and
other fees and expenses actually incurred in connection with such issuance, sale
or contribution and net of taxes paid or payable as a result thereof.
"Non-Recourse Debt" means Indebtedness (i) as to which neither
the Company nor any Restricted Subsidiary (A) provides any Guarantee or credit
support of any kind (including any undertaking, Guarantee, indemnity, agreement
or instrument that would constitute Indebtedness) or (B) is directly or
indirectly liable (as a guarantor or otherwise) and (ii) no default with respect
to which (including any rights that the holders thereof may have to take
enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the
Company or any Restricted Subsidiary to declare a default under such other
Indebtedness or cause the payment thereof to be accelerated or payable prior to
its stated maturity.
"Officer" means the Chief Executive Officer, President, Chief
Financial Officer, any Vice President, Controller, Secretary or Treasurer of the
Company.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal
counsel. The counsel may be an employee of or counsel to the Company or the
Trustee.
14
"Permitted Holders" means Apollo, J. ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇.
▇▇▇▇▇▇, their respective Affiliates and successors or assigns and any Person
acting in the capacity of an underwriter in connection with a public or private
offering of the Company's Capital Stock.
"Permitted Investment" means an Investment by the Company or
any Restricted Subsidiary in any of the following:
(i) a Restricted Subsidiary, the Company or a Person that
will, upon the making of such Investment, become a Restricted
Subsidiary;
(ii) another Person if as a result of such Investment
such other Person is merged or consolidated with or into, or transfers
or conveys all or substantially all its assets to, the Company or a
Restricted Subsidiary;
(iii) Temporary Cash Investments or Cash Equivalents;
(iv) receivables owing to the Company or any Restricted
Subsidiary, if created or acquired in the ordinary course of business
and payable or dischargeable in accordance with customary trade terms;
provided, however, that such trade terms may include such concessionary
trade terms as the Company or any such Restricted Subsidiary deems
reasonable under the circumstances;
(v) securities or other Investments received as
consideration in connection with RTO Facility Swaps or in sales or
other dispositions of property or assets made in compliance with the
covenant contained in Section 1017;
(vi) securities or other Investments received in
settlement of debts created in the ordinary course of business and
owing to the Company or any Restricted Subsidiary, or as a result of
foreclosure, perfection or enforcement of any Lien, or in satisfaction
of judgments, including in connection with any bankruptcy proceeding or
other reorganization of another Person;
(vii) Investments in existence or made pursuant to
legally binding written commitments in existence on the date of the
Existing Indenture;
(viii) Currency Agreements, Interest Rate Agreements and
related Hedging Obligations, which obligations are Incurred in
compliance with the covenant contained in Section 1010;
(ix) pledges or deposits (A) with respect to leases or
utilities provided to third parties in the ordinary course of business
or (B) otherwise described in the definition of "Permitted Liens";
(x) Investment in a Related Business in an amount not to
exceed $10 million in the aggregate; and
(xi) other Investments in an aggregate amount not to
exceed the sum of $10 million and the aggregate non-cash net proceeds
received by the Company from the
15
issue or sale of its Capital Stock (other than Disqualified Stock)
subsequent to the date of the Existing Indenture (other than non-cash
proceeds from an issuance or sale of such Capital Stock to a Subsidiary
of the Company or an employee stock ownership plan or similar trust);
provided, however, that the value of such non-cash net proceeds shall
be as conclusively determined by the Board of Directors in good faith,
except that in the event the value of any non-cash net proceeds shall
be $25 million or more, the value shall be as determined in writing by
an independent investment banking firm of nationally recognized
standing.
"Permitted Liens" means: (i) Liens for taxes, assessments or
other governmental charges not yet delinquent or the nonpayment of which in the
aggregate would not be reasonably expected to have a material adverse effect on
the Company and its Restricted Subsidiaries, or that are being contested in good
faith and by appropriate proceedings if adequate reserves with respect thereto
are maintained on the books of the Company or such Subsidiary, as the case may
be, in accordance with GAAP; (ii) carriers', warehousemen's, mechanics',
landlords', materialmen's, repairmen's or other like Liens arising in the
ordinary course of business in respect of obligations that are not overdue for a
period of more than 60 days or that are bonded or that are being contested in
good faith and by appropriate proceedings; (iii) pledges, deposits or Liens in
connection with workers' compensation, unemployment insurance and other social
security legislation and/or similar legislation or other insurance-related
obligations (including without limitation, pledges or deposits securing
liability to insurance carriers under insurance or self-insurance arrangements);
(iv) pledges, deposits or Liens to secure the performance of bids, tenders,
trade, government or other contracts (other than for borrowed money),
obligations for or under or in respect of utilities, leases, licenses, statutory
obligations, surety, judgment and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of business; (v)
easements (including reciprocal easement agreements), rights-of-way, building,
zoning and similar restrictions, utility agreements, covenants, reservations,
restrictions, encroachments, changes, and other similar encumbrances or title
defects incurred, or leases or subleases granted to others, in the ordinary
course of business, which do not in the aggregate materially interfere with the
ordinary conduct of the business of the Company and its Subsidiaries, taken as a
whole; (vi) Liens existing on, or provided for under written arrangements
existing on, the date of the Existing Indenture, or (in the case of any such
Liens securing Indebtedness of the Company or any of its Subsidiaries existing
or arising under written arrangements existing on the date of the Existing
Indenture) securing any Refinancing Indebtedness in respect of such Indebtedness
so long as the Lien securing such Refinancing Indebtedness is limited to all or
part of the same property or assets (plus improvements, accessions, proceeds or
dividends or distributions in respect thereof) that secured (or under such
written arrangements could secure) the original Indebtedness; (vii) Liens
securing Hedging Obligations Incurred in compliance with the covenant contained
in Section 1010; (viii) Liens arising out of judgments, decrees, orders or
awards in respect of which the Company shall in good faith be prosecuting an
appeal or proceedings for review which appeal or proceedings shall not have been
finally terminated, or the period within which such appeal or proceedings may be
initiated shall not have expired; (ix) Liens securing (A) Indebtedness Incurred
in compliance with clause (i), (ii) or (v) of the second paragraph of Section
1010 or clause (iv) thereof (other than Refinancing Indebtedness Incurred in
respect of Indebtedness described in the first paragraph thereof) or (B) Bank
Indebtedness; (x) Liens on properties or assets of the Company securing Senior
Indebtedness; (xi) Liens existing on property or assets of a Person at the time
16
such Person becomes a Subsidiary of the Company (or at the time the Company or a
Restricted Subsidiary acquires such property or assets); provided, however, that
such Liens are not created in connection with, or in contemplation of, such
other Person becoming such a Subsidiary (or such acquisition of such property or
assets), and that such Liens are limited to all or part of the same property or
assets (plus improvements, accessions, proceeds or dividends or distributions in
respect thereof) that secured (or, under the written arrangements under which
such Liens arose, could secure) the obligations to which such Liens relate,
(xii) Liens on Capital Stock of an Unrestricted Subsidiary that secure
Indebtedness or other obligations of such Unrestricted Subsidiary; (xiii) Liens
securing the Securities; and (xiv) Liens securing Refinancing Indebtedness
Incurred in respect of any Indebtedness secured by, or securing any refinancing,
refunding, extension, renewal or replacement (in whole or in part) of any other
obligation secured by, any other Permitted Liens, provided that any such new
Lien is limited to all or part of the same property or assets (plus
improvements, accessions, proceeds or dividends or distributions in respect
thereof) that secured (or, under the written arrangements under which the
original Lien arose, could secure) the obligations to which such Liens relate.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, limited liability company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Preferred Stock", as applied to the Capital Stock of any
corporation, means Capital Stock of any class or classes (however designated)
that is preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Purchase Money Obligations" means any Indebtedness of the
Company or any Restricted Subsidiary Incurred to finance the acquisition,
construction or capital improvement of any property or business (including
Indebtedness Incurred within 90 days following such acquisition or
construction), including Indebtedness of a Person existing at the time such
Person becomes a Restricted Subsidiary or assumed by the Company or a Restricted
Subsidiary in connection with the acquisition of assets from such Person;
provided, however, that any Lien on such Indebtedness shall not extend to any
property other than the property so acquired or constructed.
"Refinancing Indebtedness" means Indebtedness that is Incurred
to refund, refinance, replace, renew, repay or extend (including pursuant to any
defeasance or discharge mechanism) (collectively, "refinances" and "refinanced"
shall have a correlative meaning) any Indebtedness existing on the date of this
Indenture or Incurred in compliance with this Indenture (including Indebtedness
of the Company that refinances Indebtedness of any Restricted Subsidiary (to the
extent permitted in this Indenture) and Indebtedness of any Restricted
Subsidiary that refinances Indebtedness of another Restricted Subsidiary)
including Indebtedness that refinances Refinancing Indebtedness; provided,
however, that (i) the Refinancing Indebtedness has a Stated Maturity no earlier
than the Stated Maturity of the Indebtedness being refinanced, (ii) the
Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of
the Indebtedness being refinanced and (iii) such Refinancing Indebtedness is
Incurred in an aggregate principal
17
amount (or if issued with original issue discount, an aggregate issue price)
that is equal to or less than the aggregate principal amount (or if issued with
original issue discount, the aggregate accreted value) then outstanding of the
Indebtedness being refinanced, plus fees, underwriting discounts, premiums and
other costs and expenses incurred in connection with such Refinancing
Indebtedness; provided further, however, that Refinancing Indebtedness shall not
include (x) Indebtedness of a Restricted Subsidiary that refinances Indebtedness
of the Company or (y) Indebtedness of the Company or a Restricted Subsidiary
that refinances Indebtedness of an Unrestricted Subsidiary.
"Registration Rights Agreement" means (i) the Registration
Rights Agreement dated as of December 19, 2001 among (a) the Company, (b) the
Subsidiary Guarantors and (c) ▇.▇. ▇▇▇▇▇▇ Securities Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, Bear, ▇▇▇▇▇▇▇ & Co. Inc. and ▇▇▇▇▇▇ Brothers Inc., collectively as
initial purchasers, relating to the Initial Series C Notes and (ii) any similar
agreement that the Company and the Subsidiary Guarantors may enter into in
relation to any other Series C Notes, in each case as such agreement may be
amended, modified or supplemented from time to time.
"Regular Record Date" means, with respect to any Interest
Payment Date, the February 1 or August 1 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date.
"Related Business" means those businesses, other than the car
rental business, in which the Company or any of its Subsidiaries is engaged on
the date of this Indenture or that are reasonably related or incidental thereto.
"Representative" means the trustee, agent or representative
(if any) of an issue of Senior Indebtedness.
"Restricted Subsidiary" means any Subsidiary of the Company
other than an Unrestricted Subsidiary.
"Revolving Credit Facility" means the revolving credit
facility under the Senior Credit Facility (which may include any swing line or
letter of credit facility or subfacility thereunder).
"RTO Facility" means any facility through which the Company or
any of its Restricted Subsidiaries conducts the business of renting merchandise
to its customers and any facility through which a franchisee of the Company or
any of its Subsidiaries conducts the business of renting merchandise to
customers.
"RTO Facility Swap" means an exchange of assets (including
Capital Stock of a Subsidiary or the Company) of substantially equivalent fair
market value, as conclusively determined in good faith by the Board of
Directors, by the Company or a Restricted Subsidiary for one or more RTO
Facilities or for cash, Capital Stock, Indebtedness or other securities of any
Person owning or operating one or more RTO Facilities and primarily engaged in a
Related Business; provided, however, that any Net Cash Proceeds received by the
Company or any Restricted Subsidiary in connection with any such transaction
must be applied in accordance with Section 1017.
18
"Sale/Leaseback Transaction" means an arrangement relating to
property now owned or hereafter acquired by the Company or a Restricted
Subsidiary whereby the Company or such Restricted Subsidiary transfers such
property to a Person and the Company or such Restricted Subsidiary leases it
from such Person, other than leases (i) between the Company and a Restricted
Subsidiary or (ii) required to be classified and accounted for as capitalized
leases for financial reporting purposes in accordance with GAAP.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company
secured by a Lien.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Agreement" means the credit agreement dated as
of August 5, 1998, among the Company, the banks and other financial institutions
party thereto from time to time, Comerica, N.A., as the documentation agent,
NationsBank, N.A. as syndication agent and JPMorgan, as administrative agent, as
such agreement may be assumed by any successor in interest, and as such
agreement may be amended, supplemented, waived or otherwise modified from time
to time, or refunded, refinanced, restructured, replaced, renewed, repaid,
increased or extended from time to time (whether in whole or in part, whether
with the original agent and lenders or other agents and lenders or otherwise,
and whether provided under the original Senior Credit Agreement or otherwise).
"Senior Credit Facility" means the collective reference to the
Senior Credit Agreement, any Loan Documents (as defined therein), any notes and
letters of credit issued pursuant thereto and any guarantee and collateral
agreement, patent and trademark security agreement, mortgages, letter of credit
applications and other security agreements and collateral documents, and other
instruments and documents, executed and delivered pursuant to or in connection
with any of the foregoing, in each case as the same may be amended,
supplemented, waived or otherwise modified from time to time, or refunded,
refinanced, restructured, replaced, renewed, repaid, increased or extended from
time to time (whether in whole or in part, whether with the original agent and
lenders or other agents and lenders or otherwise, and whether provided under the
original Senior Credit Agreement or otherwise). Without limiting the generality
of the foregoing, the term "Senior Credit Facility" shall include any agreement
(i) changing the maturity of any Indebtedness Incurred thereunder or
contemplated thereby, (ii) adding Subsidiaries of the Company as additional
borrowers or guarantors thereunder, (iii) increasing the amount of Indebtedness
Incurred thereunder or available to be borrowed thereunder or (iv) otherwise
altering the terms and conditions thereof.
"Senior Indebtedness" means the following obligations, whether
outstanding on the date of this Existing Indenture or thereafter issued, without
duplication: (i) all obligations consisting of Bank Indebtedness; and (ii) all
obligations consisting of the principal of and premium, if any, and accrued and
unpaid interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company regardless
of whether postfiling interest is allowed in such proceeding) on, and fees and
other amounts owing in respect of, all other Indebtedness of the Company,
unless, in the instrument creating or
19
evidencing the same or pursuant to which the same is outstanding, it is provided
that the obligations in respect of such Indebtedness are not superior in right
of payment to the Securities; provided, however, that Senior Indebtedness shall
not include (A) any obligation of the Company to any Subsidiary or any other
Affiliate of the Company, or any such Affiliate's Subsidiaries, (B) any
liability for Federal, state, foreign, local or other taxes owed or owing by the
Company, (C) any accounts payable or other liability to trade creditors arising
in the ordinary course of business (including Guarantees thereof or instruments
evidencing such liabilities) or other current liabilities (other than current
liabilities which constitute Bank Indebtedness or the current portion of any
long-term Indebtedness which would constitute Senior Indebtedness but for the
operation of this clause (C)), (D) any Indebtedness, Guarantee or obligation of
the Company that is expressly subordinate or junior to any other Indebtedness,
Guarantee or obligation of the Company, (E) Indebtedness which is represented by
redeemable Capital Stock or (F) that portion of any Indebtedness that is
Incurred in violation of this Indenture. If any Designated Senior Indebtedness
is disallowed, avoided or subordinated pursuant to the provisions of Section 548
of Title 11 of the United States Code or any applicable state fraudulent
conveyance law, such Designated Senior Indebtedness nevertheless will constitute
Senior Indebtedness.
"Senior Subordinated Indebtedness" means the Securities and
any other Indebtedness of the Company that (i) specifically provides that such
Indebtedness is to rank pari passu with the Securities or is otherwise entitled
Senior Subordinated Indebtedness and (ii) is not subordinated by its terms to
any Indebtedness or other obligation of the Company that is not Senior
Indebtedness.
"Shelf Registration Statement" has the meaning ascribed
thereto in the Registration Rights Agreement.
"Significant Subsidiary" means (i) each Subsidiary that for
the most recent fiscal year of such Subsidiary had consolidated revenues greater
than $10.0 million or as at the end of such fiscal year had assets or
liabilities greater than $10.0 million and (ii) any group of Subsidiaries that,
taken together, would constitute a Significant Subsidiary.
"S&P" means Standard & Poor's Ratings Service, a division of
The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. and its successors.
"Stated Maturity" means, with respect to any security, the
date specified in such security as the fixed date on which the payment of
principal of such security is due and payable, including pursuant to any
mandatory redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency beyond the control of the issuer unless such
contingency has occurred).
"Subordinated Obligation" means any Indebtedness of the
Company (whether outstanding on the date of this Indenture or thereafter
Incurred) which is subordinate or junior in right of payment to the Securities
pursuant to a written agreement.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which more than 50% of the total voting
power of shares of Capital
20
Stock or other interests (including partnership interests) entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by (i) such Person or (ii) one or more Subsidiaries of
such Person.
"Subsidiary Guarantee" means, individually, any Guarantee of
payment of the Securities by a Subsidiary Guarantor pursuant to the terms of
this Indenture, and, collectively, all such Guarantees. Each such Subsidiary
Guarantee will be in the form prescribed in this Indenture.
"Subsidiary Guarantor" means (i) ColorTyme, Inc. and Advantage
Companies, Inc. and (ii) any Restricted Subsidiary created or acquired by the
Company after the date of this Indenture.
"Successor Company" shall have the meaning assigned thereto in
Section 801.
"Temporary Cash Investments" means any of the following: (i)
any investment in direct obligations (x) of the United States of America or any
agency thereof or obligations Guaranteed by the United States of America or any
agency thereof or (y) of any foreign country recognized by the United States of
America rated at least "A" by S&P or "A-1" by Moody's, (ii) investments in time
deposit accounts, certificates of deposit and money market deposits maturing
within 180 days of the date of acquisition thereof issued by a bank or trust
company that is organized under the laws of the United States of America, any
state thereof or any foreign country recognized by the United States of America
having capital and surplus aggregating in excess of $250 million (or the foreign
currency equivalent thereof), and whose long-term debt is rated "A" by S&P or
"A-1" by Moody's, (iii) repurchase obligations with a term of not more than 180
days for underlying securities of the types described in clause (i) or (ii)
above entered into with a bank meeting the qualifications described in clause
(ii) above, (iv) Investments in commercial paper, maturing not more than 180
days after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the
United States of America or any foreign country recognized by the United States
of America with a rating at the time as of which any Investment therein is made
of "P-1" (or higher) according to Moody's or "A-1" (or higher) according to S&P,
(v) Investments in securities with maturities of six months or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States of America, or by any political subdivision or
taxing authority thereof, and rated at least "A" by S&P or "A" by Moody's, (vi)
any money market deposit accounts issued or offered by a domestic commercial
bank or a commercial bank organized and located in a country recognized by the
United States of America, in each case, having capital and surplus in excess of
$250 million (or the foreign currency equivalent thereof), or investments in
money market funds complying with the risk limiting conditions of Rule 2a-7 (or
any short-term successor rule) of the SEC, under the Investment Company Act of
1940, as amended, and (vii) similar short-term investments approved by the Board
of Directors in the ordinary course of business.
"Thorn Americas Acquisition" means the acquisition of Thorn
Americas by the Company.
21
"TIA" means the Trust Indenture Act of 1939 (15
U.S.C. Sections 77aaa-77bbbb) as in effect on the date of this Indenture.
"Trade Payables" means, with respect to any Person, any
accounts payable or any Indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person arising in the ordinary course of
business in connection with the acquisition of goods or services.
"Transactions," means collectively the Thorn Americas
Acquisition, the offering of the Securities, under the Existing Indenture, the
initial borrowings under the Senior Credit Facility, and all other transactions
relating to the Thorn Americas Acquisition or the financing thereof, including
the issuance of Convertible Preferred Stock.
"Transfer Restricted Securities" means Securities that bear or
are required to bear the legend set forth in Section 202 hereof.
"Trustee" means the party named as such in this Indenture
until a successor replaces it and, thereafter, means the successor.
"Trust Officer" means, when used with respect to the Trustee,
any officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant secretary, assistant
treasurer, trust officer or any other officer of the Trustee who customarily
performs functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such person's knowledge of and familiarity with the
particular subject and who shall have direct responsibility for the
administration of this Indenture.
"Unrestricted Subsidiary" means (i) any Subsidiary of the
Company that at the time of determination shall be designated an Unrestricted
Subsidiary by the Board of Directors in the manner provided below and (ii) any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate
any Subsidiary of the Company (including any newly acquired or newly formed
Subsidiary of the Company) to be an Unrestricted Subsidiary unless such
Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of,
or owns or holds any Lien on any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so
designated; provided, however, that either (A) the Subsidiary to be so
designated has total consolidated assets of $10,000 or less or (B) if such
Subsidiary has consolidated assets greater than $10,000, then such designation
would be permitted under Section 1009. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that
immediately after giving effect to such designation, (x) the Company could Incur
at least $1.00 of additional Indebtedness under the first paragraph in the
covenant contained in Section 1010 and (y) no Default or Event of Default shall
have occurred and be continuing. Any such designation by the Board of Directors
shall be evidenced to the Trustee by promptly filing with the Trustee a copy of
the resolution of the Company's Board of Directors giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the foregoing provisions.
22
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Voting Stock" of an entity means all classes of Capital Stock
of such entity then outstanding and normally entitled to vote in the election of
directors or all interests in such entity with the ability to control the
management or actions of such entity.
"Wholly Owned Subsidiary" means a Restricted Subsidiary of the
Company, all of the Capital Stock of which (other than directors' qualifying
shares) is owned by the Company or another Wholly Owned Subsidiary.
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company or any
Subsidiary Guarantor to the Trustee to take any action under any provision of
this Indenture, the Company and such Subsidiary Guarantor, as the case may be,
shall furnish to the Trustee an Officers' Certificate in form and substance
reasonably acceptable to the Trustee stating that all conditions precedent, if
any, provided for in this Indenture (including any covenant compliance with
which constitutes a condition precedent) relating to the proposed action have
been complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
provided pursuant to Section 1018(a)) shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual
or such firm, he or it has made such examination or investigation as is
necessary to enable him or it to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
23
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company, any
Guarantor or other obligor on the Securities may be based, insofar as it relates
to legal matters, upon a certificate or opinion of, or representations by,
counsel, unless such officer knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to the
matters upon which his certificate or opinion is based are erroneous. Any such
certificate or Opinion of Counsel may be based, insofar as it relates to factual
matters, upon a certificate or opinion of, or representations by, an officer or
officers of the Company, any Guarantor or other obligor on the Securities
stating that the information with respect to such factual matters is in the
possession of the Company, any Guarantor or other obligor on the Securities
unless such counsel knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agents duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company and
the Subsidiary Guarantors, as the case may be. Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and conclusive in
favor of the Trustee, the Company and the Subsidiary Guarantors, if made in the
manner provided in this Section 104.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner that the Trustee deems sufficient.
24
(c) The principal amount and serial numbers of Securities held
by any Person, and the date of holding the same, shall be proved by the Note
Register.
(d) If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Company may, at its option, by or pursuant to a Board Resolution, fix in advance
a record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. Notwithstanding TIA Section 316(c),
such record date shall be the record date specified in or pursuant to such Board
Resolution, which shall be a date not earlier than the date 30 days prior to the
first solicitation of Holders generally in connection therewith and not later
than the date such solicitation is completed. If such a record date is fixed,
such request, demand, authorization, direction, notice, consent, waiver or other
Act may be given before or after such record date, but only the Holders of
record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of Outstanding Securities have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent, waiver or other
Act, and for that purpose the Outstanding Securities shall be computed as of
such record date; provided that no such authorization, agreement or consent by
the Holders on such record date shall be deemed effective unless it shall become
effective pursuant to the provisions of this Indenture not later than six months
after the record date.
(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
(including in accordance with Section 310) in respect of anything done, omitted
or suffered to be done by the Trustee, any Paying Agent or the Company or any
Guarantor in reliance thereon, whether or not notation of such action is made
upon such Security.
SECTION 105. Notices, Etc., to Trustee, the Company and any
Guarantor.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company or any
Subsidiary Guarantor shall be sufficient for every purpose hereunder if
made, given, furnished or delivered in writing (which may be via
facsimile) and mailed, first-class postage prepaid, or delivered by
recognized overnight courier, to or with the Trustee and received at
its Corporate Trust Office, Attention: Corporate Trust Administration.
(2) the Company or any Subsidiary Guarantor by the Trustee or
by any Holder shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or
delivered, in writing, or mailed, first-class postage prepaid, or
delivered by recognized overnight courier, to the Company or such
Subsidiary Guarantor addressed to it and received at the address of its
principal office specified in the first paragraph of this Indenture, or
at any other address previously furnished in writing to the Trustee by
the Company or such Subsidiary Guarantor.
25
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event to
Holders by the Company, any Subsidiary Guarantor or the Trustee, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each Holder affected by such
event, at his address as it appears in the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. Neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Any notice mailed to a Holder in the
manner herein prescribed shall be conclusively deemed to have been received by
such Holder, whether or not such Holder actually receives such notice. Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of or irregularities in
regular mail service or by reason of any other cause, it shall be impracticable
to mail notice of any event to Holders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Trustee shall be deemed to be a
sufficient giving of such notice for every purpose hereunder.
If the Company or any Subsidiary Guarantor mails any notice or
communication to any Holder, it shall mail a copy to the Trustee at the same
time.
SECTION 107. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 108. Successors and Assigns.
All covenants and agreements in this Indenture by the Company
and each Subsidiary Guarantor shall bind its successors and assigns, whether so
expressed or not.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, (other than the parties hereto, any agent and
their successors hereunder and each of the Holders and, with respect to any
provisions hereof relating to the subordination of the Securities or the rights
of holders of Senior Indebtedness, the holders of Senior Indebtedness) any
benefit or any legal or equitable right, remedy or claim under this Indenture.
26
SECTION 111. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK EXCLUDING (TO
THE GREATEST EXTENT PERMISSIBLE BY LAW) ANY RULE OF LAW THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF
NEW YORK.
UPON THE ISSUANCE OF THE EXCHANGE SECURITIES OR THE EFFECTIVENESS OF THE SHELF
REGISTRATION STATEMENT, THIS INDENTURE SHALL BE SUBJECT TO THE PROVISIONS OF THE
TRUST INDENTURE ACT THAT ARE REQUIRED TO BE PART OF THIS INDENTURE AND SHALL, TO
THE EXTENT APPLICABLE, BE GOVERNED BY SUCH PROVISIONS. EACH OF THE PARTIES
HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF
NEW
YORK AND THE U.S. FEDERAL COURTS, IN EACH CASE SITTING IN THE BOROUGH OF
MANHATTAN, AND WAIVES ANY OBJECTION AS TO VENUE OR FORUM NON CONVENIENS.
SECTION 112. Legal Holidays.
In any case where any interest payment date, any date
established for payment of Defaulted Interest pursuant to Section 311 or
redemption date or Stated Maturity of any Security shall not be a Business Day,
then (notwithstanding any other provision of this Indenture or of the
Securities) payment of principal (or premium, if any) or interest need not be
made on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the interest payment date or date
established for payment of Defaulted Interest pursuant to Section 311,
Redemption Date, or at the Stated Maturity or Maturity; provided that no
interest shall accrue for the period from and after such interest payment date,
redemption date or date established for payment of Defaulted Interest pursuant
to Section 311, Stated Maturity or Maturity, as the case may be, to the next
succeeding Business Day.
SECTION 113. No Personal Liability of Directors, Officers,
Employees, Stockholders or Incorporators.
No director, officer, employee, incorporator or stockholders,
as such, of the Company or any Subsidiary Guarantor shall have any liability for
any obligations of the Company or such Subsidiary Guarantor under the
Securities, this Indenture or any Subsidiary Guarantee or for any claim based
on, in respect of, or by reason of, such obligations or their creations. Each
Holder 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 114. Counterparts.
This Indenture may be executed in any number of counterparts,
each of which shall be original; but such counterparts shall together constitute
but one and the same instrument.
27
SECTION 115. Communications by Holders with Other Holders.
Holders may communicate pursuant to TIA Section 312(b) with
other Holders with respect to their rights under this Indenture or the
Securities. The Company, the Subsidiary Guarantors, the Trustee, the Note
Registrar and anyone else shall have the protection of TIA Section 312(c).
ARTICLE TWO.
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities and the Trustee's certificate of authentication
shall be in substantially the forms set forth in this Article, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture, and may have such letters, numbers or
other marks of identification and such legends or endorsements placed thereon as
may be required to comply with applicable laws or the rules of any securities
exchange or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution of the Securities.
Any portion of the text of any Security may be set forth on the reverse thereof,
with an appropriate reference thereto on the face of the Security. Each Security
shall be dated the date of its authentication.
Series C Notes offered and sold to the qualified institutional
buyers (as defined in Rule 144A under the Securities Act) in the United States
of America ("Rule 144A Note") will be issued on the date of this Indenture and
on dates issued from time to time after the date hereof as may be set forth in a
Company Order and in the form of one or more permanent global Securities
substantially in the form set forth in Section 203 (each, a "Rule 144A Global
Note") deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The Rule 144A Global Notes may be represented by more than one
certificate, if so required by the Depositary's rules regarding the maximum
principal amount to be represented by a single certificate. The aggregate
principal amount of the Rule 144A Global Notes may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
Series C Notes offered and sold outside the United States of
America ("Regulation S Note") in reliance on Regulation S shall be issued in the
form of one or more permanent global Securities substantially in the form set
forth in Section 203 (each, a "Regulation S Global Note"). The Regulation S
Global Notes will be deposited with the Trustee, as custodian for the
Depositary, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The Regulation S Global Notes may be represented by more
than one certificate, if so required by the Depositary's rules regarding the
maximum principal amount to be represented by a single certificate. The
aggregate principal amount of the Regulation S Global Notes may from time to
time be increased or decreased by adjustments made on the records of the
Trustee, as custodian for the Depositary or its nominee, as hereinafter
provided.
28
Series C Notes offered and sold to institutional "accredited
investors" (as defined in Rule 501(a)(1), (2), (3) and (7) under the Securities
Act) in the United States of America ("Institutional Accredited Investor Note")
will be issued in the form of one or more permanent global Securities
substantially in the form set forth in Section 203 (each, an "Institutional
Accredited Investor Global Note") deposited with the Trustee, as custodian for
the Depositary, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The Institutional Accredited Investor Global Notes may be
represented by more than one certificate, if so required by the Depositary's
rules regarding the maximum principal amount to be represented by a single
certificate. The aggregate principal amount of the Institutional Accredited
Investor Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian for the Depositary
or its nominee, as hereinafter provided.
The Rule 144A Global Notes, the Regulation S Global Notes and
the Institutional Accredited Investor Global Notes are sometimes collectively
herein referred to as the "Global Notes."
The definitive Securities shall be printed, lithographed or
engraved on steel-engraved borders or may be produced in any other manner, all
as determined by the officers of the Company executing such Securities, as
evidenced by their execution of such Securities.
SECTION 202. Restrictive Legends.
Unless and until (i) a Series C Note is sold under an
effective Registration Statement or (ii) a Series C Note is exchanged for a
Series D Note in connection with an effective Registration Statement, in each
case pursuant to the Registration Rights Agreement, the Rule 144A Global Notes
and the Institutional Accredited Investor Global Notes shall bear the following
legend (the "Private Placement Legend") on the face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B)
PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER
29
THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E)
TO AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF SECTION
501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A TRANSACTION
INVOLVING A MINIMUM PRINCIPAL AMOUNT OF $250,000 OF SUCH SECURITIES,
FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR
(F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) ABOVE TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM, AND IN THE CASE OF THE FOREGOING CLAUSE (E), A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY AND THE
TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE.
The Regulation S Global Notes shall bear the following legend
on the face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO
OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN
THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1)
REPRESENTS THAT IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY
IN AN OFFSHORE TRANSACTION, (2) BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY, (B)
PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
30
ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF SECTION
501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A TRANSACTION
INVOLVING A MINIMUM PRINCIPAL AMOUNT OF $250,000 OF SUCH SECURITIES,
FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR
(F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) ABOVE TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM, AND IN THE CASE OF THE FOREGOING CLAUSE (E), A CERTIFICATE OF
TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY AND THE
TRUSTEE. THIS LEGEND WILL BE REMOVED AFTER 40 CONSECUTIVE DAYS
BEGINNING ON AND INCLUDING THE LATER OF (A) THE DAY ON WHICH THE
SECURITIES ARE OFFERED TO PERSONS OTHER THAN DISTRIBUTORS (AS DEFINED
IN REGULATION S) AND (B) THE DATE OF THE CLOSING OF THE ORIGINAL
OFFERING. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION", "UNITED
STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION
S UNDER THE SECURITIES ACT.
The Global Notes, whether or not a Series C Note, shall also
bear the following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY ("DTC") TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
REPRESENTATIVE OF DTC AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
31
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH
THE RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307 OF THE INDENTURE.
SECTION 203. Form of Series C Notes.
No. [ ] Principal Amount $[ ]
--- --------------
CUSIP NO.
------------
11% Senior Subordinated Note due 2008, Series C
Rent-A-Center, Inc., a Delaware corporation promises to pay to
Cede & Co., or registered assigns, the principal sum of [__________________]
Dollars on August 15, 2008.
Interest Payment Dates: February 15 and August 15.
Record Dates: February 1 and August 1.
Additional provisions of this Security are set forth on the
other side of this Security.
Dated: , 200 RENT-A-CENTER, INC.
--------- -
By:
--------------------------------------
Title:
By:
--------------------------------------
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF
NEW YORK,
------------------------------------
as Trustee, certifies
that this is one of the
Securities referred to
in the Indenture.
By:
---------------------------------
Authorized Signatory , 200
---------- -
32
[FORM OF REVERSE SIDE OF SENIOR SUBORDINATED SECURITY]
11% Senior Subordinated Note due 2008, Series C
1. Interest
Rent-A-Center, Inc., a Delaware corporation (such corporation,
and its successors and assigns under the Indenture hereinafter referred to,
being herein called the "Company") promises to pay interest on the principal
amount of this Security at the rate per annum shown above.
The Company will pay interest semiannually in cash and in
arrears to Holders of record at the close of business on the February 1 and
August 1 immediately preceding the interest payment date on February 15 and
August 15 of each year, commencing February 15, 2002. Interest on the Securities
will accrue from the most recent date to which interest has been paid on the
Securities or, if no interest has been paid, from December 19, 2001. The Company
shall pay interest on overdue principal or premium, if any (plus interest on
such interest to the extent lawful), at the rate borne by the Securities to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment
By at least 10:00 a.m. (
New York City time) on the date on
which any principal of or interest on the Securities is due and payable, the
Company shall irrevocably deposit with the Trustee or the Paying Agent money
sufficient to pay such principal, premium, if any, and/or interest. The Company
will pay interest (except defaulted interest) to the Persons who are registered
Holders of Securities at the close of business on the February 1 or August 1
next preceding the interest payment date even if the Securities are cancelled,
repurchased or redeemed after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. However, the Company may pay interest by check payable in
such money. It may mail an interest check to a Holder's registered address.
3. Trustee, Paying Agent and Registrar
Initially, The Bank of New York, a New York banking
corporation (the "Trustee"), will act as Trustee, Paying Agent and Registrar.
The Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice to any Securityholder. The Company or any of its domestically
incorporated Wholly Owned Subsidiaries may act as Paying Agent, Registrar or
co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as
of December 19, 2001 (as it may be amended or supplemented from time to time in
accordance with the terms thereof, the "Indenture"), among the Company, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture
33
by reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Capitalized
terms used herein and not defined herein have the meanings ascribed thereto in
the Indenture. The Securities are subject to all such terms, and Securityholders
are referred to the Indenture and the Act for a statement of those terms.
The Securities are general unsecured senior subordinated
obligations of the Company initially issued in aggregate principal amount of
$100,000,000, but subject to additional issuances under the Indenture. This
Security is one of the Series C Notes referred to in the Indenture. The
Securities include the Series C Notes and any Series D Notes issued in exchange
for the Series C Notes pursuant to the Indenture and the Registration Rights
Agreement. The Series C Notes and the Series D Notes are treated as a single
class of securities under the Indenture. The Indenture imposes certain
limitations on the Incurrence of Indebtedness by the Company and its Restricted
Subsidiaries, the payment of dividends on, and the purchase or redemption of,
Capital Stock of the Company and its Restricted Subsidiaries, certain purchases
or redemptions of Subordinated Indebtedness, the sale or transfer of assets and
Capital Stock of Restricted Subsidiaries, investments of the Company and its
Restricted Subsidiaries and transactions with Affiliates. In addition, the
Indenture limits the ability of the Company and its Subsidiaries to restrict
distributions and dividends from Restricted Subsidiaries.
5. Optional Redemption
The Securities will be redeemable, at the Company's option, in
whole or in part, at any time and from time to time on and after August 15, 2003
and prior to maturity, upon not less than 30 nor more than 90 days' prior notice
mailed by first-class mail to each Holder's registered address, at the following
redemption prices (expressed as a percentage of principal amount), plus accrued
interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date), if redeemed during the 12-month period commencing on
August 15 of the years set forth below:
Year Redemption Price
---- ----------------
2003.......................................................... 105.500%
2004.......................................................... 103.667%
2005.......................................................... 101.833%
2006 and thereafter........................................... 100.000%
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days but not
more than 90 days before the redemption date to each Holder of Securities to be
redeemed at his registered address. Securities in denominations of principal
amount larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued and
unpaid interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain other conditions are satisfied, on and after such date interest
ceases to accrue on such Securities (or such portions thereof) called for
redemption.
34
7. Put Provisions
Upon a Change of Control, any Holder of Securities will have
the right to cause the Company to repurchase all or any part of the Securities
of such Holder at a repurchase price equal to 101% of the principal amount
thereof plus accrued and unpaid interest to the date of repurchase as provided
in, and subject to the terms of, the Indenture.
8. Subordination and Ranking
The Securities are subordinated to Senior Indebtedness, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Securities may be paid. The Company agrees,
and each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose. The
Securities will in all respects rank pari passu with all other Senior
Subordinated Indebtedness of the Company.
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by law
or permitted by the Indenture. The Registrar need not register the transfer of
or exchange of (i) any Security selected for redemption (except, in the case of
a Security to be redeemed in part, the portion of the Security not to be
redeemed) for a period beginning 15 days before a selection of Securities to be
redeemed and ending on the date of such selection or (ii) any Securities for a
period beginning 15 days before an interest payment date and ending on such
interest payment date.
10. Persons Deemed Owners
The registered holder of this Security may be treated as the
owner of it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
12. Defeasance
Subject to certain conditions set forth in the Indenture, the
Company at any time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the
Securities to redemption or maturity, as the case may be.
35
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount of the outstanding Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount of the
outstanding Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Securityholder, the Company and the
Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article 5 of the Indenture,
or to provide for uncertificated Securities in addition to or in place of
certificated Securities, or to add guarantees with respect to the Securities or
to secure the Securities, or to add additional covenants or surrender rights and
powers conferred on the Company, or to comply with any request of the SEC in
connection with qualifying the Indenture under the Act, or to make any change
that does not adversely affect the rights of any Securityholder, or to provide
for the issuance of Series D Notes. However, no amendment may be made to the
subordination provisions of the Indenture that adversely affects the rights of
any holder of Senior Indebtedness then outstanding unless the holders of such
Senior Indebtedness (or any group or representative thereof authorized to give a
consent) consent to such change.
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) a default
in any payment of interest on any Security when due (whether or not such payment
is prohibited by Article 13 of the Indenture), continued for 30 days, (ii) a
default in the payment of principal of any Security when due at its Stated
Maturity, upon optional redemption, upon required repurchase, upon declaration
or otherwise, whether or not such payment is prohibited by Article 13 of the
Indenture, (iii) the failure by the Company to comply with its obligations under
Section 801 of the Indenture, (iv) the failure by the Company to comply for 30
days after written notice with any of its obligations under Section 1016 of the
Indenture or Sections 1003, 1009, 1010, 1011, 1012, 1013, 1014, 1015, 1017, 1019
or 1020 of the Indenture (in each case, other than a failure to purchase
Securities when required under Sections 1016 or 1017 of the Indenture), (v) the
failure by the Company to comply for 60 days after notice with its other
agreements contained in the Securities or the Indenture, (vi) the failure by the
Company or any Significant Subsidiary to pay any Indebtedness within any
applicable grace period after final maturity or the acceleration of any such
Indebtedness by the holders thereof because of a default if the total amount of
such Indebtedness unpaid or accelerated exceeds $25.0 million, (vii) certain
events of bankruptcy, insolvency or reorganization of the Company or a
Significant Subsidiary, (viii) the rendering of any judgment or decree for the
payment of money in an amount (net of any insurance or indemnity payments
actually received in respect thereof prior to or within 90 days from the entry
thereof, or to be received in respect thereof in the event any appeal thereof
shall be unsuccessful) in excess of $25.0 million against the Company or a
Significant Subsidiary that is not discharged, bonded or insured by a third
Person if (A) an enforcement proceeding thereon is commenced or (B) such
judgment or decree remains outstanding for a period of 90 days following such
judgment or decree and is not discharged, waived or stayed or (ix) the failure
of any Subsidiary Guarantee of the Securities by a Subsidiary Guarantor made
pursuant to Section 1020 of the Indenture to be in full force and effect (except
as contemplated by the terms thereof or of the Indenture) or the denial or
disaffirmation in writing by any such Subsidiary Guarantor
36
of its obligations under the Indenture or its Subsidiary Guarantee if such
Default continues for 10 days. If an Event of Default occurs and is continuing,
the Trustee or the Holders of at least a majority in principal amount of the
outstanding applicable Securities may declare all such Securities to be due and
payable immediately. Certain events of bankruptcy or insolvency are Events of
Default which will result in the Securities being due and payable immediately
upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives indemnity or security
reasonably satisfactory to it. Subject to certain limitations, Holders of a
majority in principal amount of the Securities may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Securityholders
notice of any continuing Default or Event of Default (except a Default or Event
of Default in payment of principal or interest) if it determines that
withholding notice is in their interest.
15. Trustee Dealings with the Company
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company, the Subsidiary Guarantors or their
affiliates and may otherwise deal with the Company, the Subsidiary Guarantors or
their affiliates with the same rights it would have if it were not Trustee.
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company or the Subsidiary Guarantors shall not have any liability for any
obligations of the Company or the Subsidiary Guarantors under the Securities,
the Subsidiary Guarantees or the Indenture or for any claim based on, in respect
of or by reason of such obligations or their creation. By accepting a Security,
each Securityholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
17. Authentication
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent acting on its behalf) manually signs
the certificate of authentication on the other side of this Security.
18. Registration Rights
The Holder of this Security is entitled to the benefits of a
Registration Rights Agreement (as defined in the Indenture). In the event that
either (i) an Exchange Offer Registration Statement is not filed with the
Commission on or prior to 60 days after the date of the original issuance of
this Security, (ii) an Exchange Offer Registration Statement is not declared
effective within 150 days after the date of the original issuance of this
Security, (iii) the Exchange Offer is not consummated on or prior to 180 days
after the date of the original issuance of this Security in respect of tendered
Securities and a Shelf Registration Statement has not been declared effective or
(iv) a Shelf Registration Statement is filed and declared effective
37
within 150 days after the date of the original issuance of this Security but
shall thereafter cease to be effective (at any time that the Company is
obligated to maintain the effectiveness thereof) without being succeeded within
45 days by an additional Registration Statement filed and declared effective
(each such event referred to in clauses (i), (ii), (iii) and (iv), a
"Registration Default"), the Company will pay liquidated damages to each holder
of Transfer Restricted Securities (as defined in the Registration Rights
Agreement), during the period of one or more such Registration Defaults, in an
amount equal to $0.192 per week per $1,000 principal amount of the Securities
constituting Transfer Restricted Securities held by such holder until the
applicable Registration Statement is filed or declared effective, the Exchange
Offer is consummated or the Shelf Registration Statement again becomes
effective, as the case may be, provided that, except in certain limited
circumstances, the Company's obligation to pay liquidated damages will terminate
upon consummation of the Exchange Offer. All accrued liquidated damages shall be
paid to holders in the same manner as interest payments on the Securities on
semi-annual payment dates which correspond to interest payment dates for the
Securities. Following the cure of all Registration Defaults, the accrual of
liquidated damages will cease.
19. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship
and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to
Minors Act).
20. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
21. Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK EXCLUDING (TO THE GREATEST
EXTENT PERMISSIBLE BY LAW) ANY RULE OF LAW THAT WOULD CAUSE THE APPLICATION OF
THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
The Company will furnish to any Securityholder upon written
request and without charge to the Securityholder a copy of the Indenture.
Requests may be made to:
Rent-A-Center, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial Officer
38
SUBSIDIARY GUARANTEE
1. Guarantee
The Subsidiary Guarantor, jointly and severally with each
other Subsidiary Guarantor, as a primary obligor and not merely as a surety,
irrevocably and unconditionally Guarantees on an unsecured senior subordinated
basis the performance and punctual payment when due, whether at Stated Maturity,
by acceleration or otherwise, all obligations of the Company under the Indenture
and the Securities, whether for payment of principal of or interest on the
Securities, expenses, indemnification or otherwise all in accordance with the
terms set forth in Article XIV of the Indenture. The Subsidiary Guarantor also
agrees to pay any and all costs and expenses (including reasonably attorney's
fees and expenses) incurred by the Trustee or any Holders in enforcing any
rights under this Subsidiary Guarantee, indemnification or otherwise.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Security upon which
this Subsidiary Guarantee is noted shall have been executed by the Trustee under
the Indenture by the manual signature of one of its authorized officers.
The obligations of the Subsidiary Guarantor shall be limited
to the extent set forth in Article XIV of the Indenture.
This Subsidiary Guarantee shall be governed by and construed
in accordance with the laws of the State of New York without regard to the
principles of conflicts of law to the extent that the application of the law of
another jurisdiction would be required thereby.
This Subsidiary Guarantee is subject to release upon the terms
set forth in the Indenture.
COLORTYME, INC.
By:
----------------------------------
Name:
Title:
39
SUBSIDIARY GUARANTEE
1. Guarantee
The Subsidiary Guarantor, jointly and severally with each
other Subsidiary Guarantor, as a primary obligor and not merely as a surety,
irrevocably and unconditionally Guarantees on an unsecured senior subordinated
basis the performance and punctual payment when due, whether at Stated Maturity,
by acceleration or otherwise, all obligations of the Company under the Indenture
and the Securities, whether for payment of principal of or interest on the
Securities, expenses, indemnification or otherwise all in accordance with the
terms set forth in Article XIV of the Indenture. The Subsidiary Guarantor also
agrees to pay any and all costs and expenses (including reasonably attorney's
fees and expenses) incurred by the Trustee or any Holders in enforcing any
rights under this Subsidiary Guarantee, indemnification or otherwise.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Security upon which
this Subsidiary Guarantee is noted shall have been executed by the Trustee under
the Indenture by the manual signature of one of its authorized officers.
The obligations of the Subsidiary Guarantor shall be limited
to the extent set forth in Article XIV of the Indenture.
This Subsidiary Guarantee shall be governed by and construed
in accordance with the laws of the State of New York without regard to the
principles of conflicts of law to the extent that the application of the law of
another jurisdiction would be required thereby.
This Subsidiary Guarantee is subject to release upon the terms
set forth in the Indenture.
ADVANTAGE COMPANIES, INC.
By:
----------------------------------
Name:
Title:
40
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the books of
the Company. The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: Your Signature:
-------------------- -------------------
Signature Guarantee:
-------------------------------------
(Signature must be guaranteed)
--------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in the Securities Transfer Agents Medallion Program ("STAMP") or such
other signature guarantee medallion program as may be approved by the Note
Registrar in addition to or substitution for, STAMP), pursuant to S.E.C. Rule
17Ad-15.
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the date that is two years after the
later of the date of original issuance of such Securities and the last date, if
any, on which such Securities were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Securities are being:
CHECK ONE BOX BELOW:
1 [ ] acquired for the undersigned's own account, without transfer; or
2 [ ] transferred to the Company; or
3 [ ] transferred pursuant to and in compliance with Rule 144A under the
Securities Act of 1933; or
4 [ ] transferred pursuant to an effective registration statement under the
Securities Act; or
5 [ ] transferred pursuant to and in compliance with Regulation S under the
Securities Act of 1933; or
6 [ ] transferred to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933), that
has furnished to the
41
Trustee a signed letter containing certain representations and
agreements (the form of which letter appears as Exhibit E to the
Indenture); or
7 [ ] transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee may refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered holder thereof; provided, however, that if box (5), (6) or
(7) is checked, the Trustee or the Company may require, prior to registering any
such transfer of the Securities, in their sole discretion, such legal opinions,
certifications and other information as the Trustee or the Company may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided by
Rule 144 under such Act.
---------------------------------
Signature
Signature Guarantee:
------------------------------ ---------------------------------
(Signature must be guaranteed) Signature
------------------------------------------------------------
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions) with
membership in the Securities Transfer Agents Medallion Program ("STAMP") or such
other signature guarantee medallion program as may be approved by the Note
Registrar in addition to or substitution for STAMP, pursuant to S.E.C. Rule
17Ad-15.
42
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The following increases or decreases in this Global Note have
been made:
Amount of decrease Amount of increase Principal Amount of Signature of
in Principal in Principal this Global Note authorized signatory
Date of Amount of this Amount of this following such Trustee or Notes
Exchange Global Note Global Note decrease or increase Custodian
43
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 1016 or 1017 of the Indenture, check the box:
[ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 1016 or 1017 of the Indenture,
state the amount in principal amount (must be integral multiple of $1,000): $
Date: Your Signature
---------- ----------------------------------------------
(Sign exactly as your name appears on the
other side of the Security)
Signature Guarantee:
---------------------------------------
(Signature must be guaranteed)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions) with
membership in the Securities Transfer Agents Medallion Program ("STAMP") or such
other signature guarantee medallion program as may be approved by the Note
Registrar in addition to or substitution for STAMP, pursuant to S.E.C. Rule
17Ad-15.
44
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL 144A CERTIFICATES]
In connection with any transfer of this Security occurring
prior to the date that is the earlier of the date of an effective Registration
Statement (as defined in the Registration Rights Agreement) or two years
following the date this Security is issued, the undersigned confirms that
without utilizing any general solicitation or general advertising that:
[Check One]
[ ] (a) this Security is being transferred in compliance with the exemption
from registration under the Securities Act of 1933, as amended,
provided by Rule 144A thereunder.
or
[ ] (b) this Security is being transferred other than in accordance with (a)
above and documents are being furnished that comply with the conditions
of transfer set forth in this Security and the Indenture.
If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Security in the name of any Person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 307 of the Indenture shall have
been satisfied.
Date:
-------------------- -------------------------------------------
NOTICE: The signature must correspond with
the name as written upon the face of
the within-mentioned instrument in
every particular, without alteration
or any change whatsoever.
Signature Guarantee:
--------------------------------------
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing
this 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
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, as amended, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned 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 the undersigned's foregoing representations
in order to claim the exemption from registration provided by Rule 144A.
Date:
-------------------- -------------------------------------------
NOTICE: To be executed by an executive
officer.
45
SECTION 204. Form of Series D Notes.
No. [ ] Principal Amount $[ ]
--- --------------
CUSIP NO.
------------
11% Senior Subordinated Note due 2008, Series D
Rent-A-Center, Inc., a Delaware corporation promises to pay to
Cede & Co., or registered assigns, the principal sum of [__________________]
Dollars on August 15, 2008.
Interest Payment Dates: February 15 and August 15.
Record Dates: February 1 and August 1.
Additional provisions of this Security are set forth on the
other side of this Security.
Dated: , 200 RENT-A-CENTER, INC.
-------- -
By:
----------------------------------------
[Title]
By:
----------------------------------------
[Title]
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
----------------------------------
THE BANK OF NEW YORK,
as Trustee, certifies
that this is one of the
Securities referred to
in the Indenture.
By:
-------------------------------
Authorized Signatory , 200
--------- -
46
[FORM OF REVERSE SIDE OF SENIOR SUBORDINATED SECURITY]
11% Senior Subordinated Note due 2008, Series D
1. Interest
Rent-A-Center, Inc., a Delaware corporation (such corporation,
and its successors and assigns under the Indenture hereinafter referred to,
being herein called the "Company") promises to pay interest on the principal
amount of this Security at the rate per annum shown above.
The Company will pay interest semiannually in cash and in
arrears to Holders of record at the close of business on the February 1 and
August 1 immediately preceding the interest payment date on February 15 and
August 15 of each year, commencing February 15, 2002. Interest on the Securities
will accrue from the most recent date to which interest has been paid on the
Securities or, if no interest has been paid, from December 19, 2001. The Company
shall pay interest on overdue principal or premium, if any (plus interest on
such interest to the extent lawful), at the rate borne by the Securities to the
extent lawful. Interest will be computed on the basis of a 360-day year of
twelve 30-day months.
2. Method of Payment
By at least 10:00 a.m. (New York City time) on the date on
which any principal of or interest on the Securities is due and payable, the
Company shall irrevocably deposit with the Trustee or the Paying Agent money
sufficient to pay such principal, premium, if any, and/or interest. The Company
will pay interest (except defaulted interest) to the Persons who are registered
Holders of Securities at the close of business on the February 1 or August 1
next preceding the interest payment date even if the Securities are cancelled,
repurchased or redeemed after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. However, the Company may pay interest by check payable in
such money. It may mail an interest check to a Holder's registered address.
3. Trustee, Paying Agent and Registrar
Initially, The Bank of New York, a New York banking
corporation (the "Trustee"), will act as Trustee, Paying Agent and Registrar.
The Company may appoint and change any Paying Agent, Registrar or co-registrar
without notice to any Securityholder. The Company or any of its domestically
incorporated Wholly Owned Subsidiaries may act as Paying Agent, Registrar or
co-registrar.
4. Indenture
The Company issued the Securities under an Indenture dated as
of December 19, 2001 (as it may be amended or supplemented from time to time in
accordance with the terms thereof, the "Indenture"), among the Company, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture
47
by reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Capitalized
terms used herein and not defined herein have the meanings ascribed thereto in
the Indenture. The Securities are subject to all such terms, and Securityholders
are referred to the Indenture and the Act for a statement of those terms.
The Securities are general unsecured senior subordinated
obligations of the Company initially issued in aggregate principal amount of
$100,000,000, but subject to additional issuances under the Indenture. This
Security is one of the Series D Notes referred to in the Indenture. The
Securities include the Series C Notes and any Series D Notes issued in exchange
for the Series C Notes pursuant to the Indenture and the Registration Rights
Agreement. The Series C Notes and the Series D Notes are treated as a single
class of securities under the Indenture. The Indenture imposes certain
limitations on the Incurrence of Indebtedness by the Company and its Restricted
Subsidiaries, the payment of dividends on, and the purchase or redemption of,
Capital Stock of the Company and its Restricted Subsidiaries, certain purchases
or redemptions of Subordinated Indebtedness, the sale or transfer of assets and
Capital Stock of Restricted Subsidiaries, investments of the Company and its
Restricted Subsidiaries and transactions with Affiliates. In addition, the
Indenture limits the ability of the Company and its Subsidiaries to restrict
distributions and dividends from Restricted Subsidiaries.
5. Optional Redemption
The Securities will be redeemable, at the Company's option, in
whole or in part, at any time and from time to time on and after August 15, 2003
and prior to maturity, upon not less than 30 nor more than 90 days' prior notice
mailed by first-class mail to each Holder's registered address, at the following
redemption prices (expressed as a percentage of principal amount), plus accrued
interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date), if redeemed during the 12-month period commencing on
August 15 of the years set forth below:
YEAR REDEMPTION PRICE
---- ----------------
2003....................................................... 105.500%
2004....................................................... 103.667%
2005....................................................... 101.833%
2006 and thereafter........................................ 100.000%
6. Notice of Redemption
Notice of redemption will be mailed at least 30 days but not
more than 90 days before the redemption date to each Holder of Securities to be
redeemed at his registered address. Securities in denominations of principal
amount larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000. If money sufficient to pay the redemption price of and accrued and
unpaid interest on all Securities (or portions thereof) to be redeemed on the
redemption date is deposited with the Paying Agent on or before the redemption
date and certain
48
other conditions are satisfied, on and after such date interest ceases to accrue
on such Securities (or such portions thereof) called for redemption.
7. Put Provisions
Upon a Change of Control, any Holder of Securities will have
the right to cause the Company to repurchase all or any part of the Securities
of such Holder at a repurchase price equal to 101% of the principal amount
thereof plus accrued and unpaid interest to the date of repurchase as provided
in, and subject to the terms of, the Indenture.
8. Subordination and Ranking
The Securities are subordinated to Senior Indebtedness, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness must be paid before the Securities may be paid. The Company agrees,
and each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give them
effect and appoints the Trustee as attorney-in-fact for such purpose. The
Securities will in all respects rank pari passu with all other Senior
Subordinated Indebtedness of the Company.
9. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by law
or permitted by the Indenture. The Registrar need not register the transfer of
or exchange of (i) any Security selected for redemption (except, in the case of
a Security to be redeemed in part, the portion of the Security not to be
redeemed) for a period beginning 15 days before a selection of Securities to be
redeemed and ending on the date of such selection or (ii) any Securities for a
period beginning 15 days before an interest payment date and ending on such
interest payment date.
10. Persons Deemed Owners
The registered holder of this Security may be treated as the
owner of it for all purposes.
11. Unclaimed Money
If money for the payment of principal or interest remains
unclaimed for two years, the Trustee or Paying Agent shall pay the money back to
the Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
49
12. Defeasance
Subject to certain conditions set forth in the Indenture, the
Company at any time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the
Securities to redemption or maturity, as the case may be.
13. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount of the outstanding Securities
and (ii) any default or noncompliance with any provision may be waived with the
written consent of the Holders of a majority in principal amount of the
outstanding Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Securityholder, the Company and the
Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article 5 of the Indenture,
or to provide for uncertificated Securities in addition to or in place of
certificated Securities, or to add guarantees with respect to the Securities or
to secure the Securities, or to add additional covenants or surrender rights and
powers conferred on the Company, or to comply with any request of the SEC in
connection with qualifying the Indenture under the Act, or to make any change
that does not adversely affect the rights of any Securityholder, or to provide
for the issuance of Series D Notes. However, no amendment may be made to the
subordination provisions of the Indenture that adversely affects the rights of
any holder of Senior Indebtedness then outstanding unless the holders of such
Senior Indebtedness (or any group or representative thereof authorized to give a
consent) consent to such change.
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) a default
in any payment of interest on any Security when due (whether or not such payment
is prohibited by Article 13 of the Indenture), continued for 30 days, (ii) a
default in the payment of principal of any Security when due at its Stated
Maturity, upon optional redemption, upon required repurchase, upon declaration
or otherwise, whether or not such payment is prohibited by Article 13 of the
Indenture, (iii) the failure by the Company to comply with its obligations under
Section 801 of the Indenture, (iv) the failure by the Company to comply for 30
days after written notice with any of its obligations under Section 1016 of the
Indenture or Sections 1003, 1009, 1010, 1011, 1012, 1013, 1014, 1015, 1017, 1019
or 1020 of the Indenture (in each case, other than a failure to purchase
Securities when required under Sections 1016 or 1017 of the Indenture), (v) the
failure by the Company to comply for 60 days after notice with its other
agreements contained in the Securities or the Indenture, (vi) the failure by the
Company or any Significant Subsidiary to pay any Indebtedness within any
applicable grace period after final maturity or the acceleration of any such
Indebtedness by the holders thereof because of a default if the total amount of
such Indebtedness unpaid or accelerated exceeds $25.0 million, (vii) certain
events of bankruptcy, insolvency or reorganization of the Company or a
Significant Subsidiary, (viii) the rendering of any judgment or decree for the
payment of money in an amount (net of any insurance or indemnity payments
actually received in respect thereof prior to or within 90 days from the entry
thereof, or to be received in respect thereof in the event any appeal thereof
shall be unsuccessful) in excess of $25.0 million against the Company or a
Significant Subsidiary that is not discharged, bonded or insured by a third
Person if (A) an enforcement proceeding thereon is
50
commenced or (B) such judgment or decree remains outstanding for a period of 90
days following such judgment or decree and is not discharged, waived or stayed
or (ix) the failure of any Subsidiary Guarantee of the Securities by a
Subsidiary Guarantor made pursuant to Section 1020 of the Indenture to be in
full force and effect (except as contemplated by the terms thereof or of the
Indenture) or the denial or disaffirmation in writing by any such Subsidiary
Guarantor of its obligations under the Indenture or its Subsidiary Guarantee if
such Default continues for 10 days. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least a majority in principal
amount of the outstanding applicable Securities may declare all such Securities
to be due and payable immediately. Certain events of bankruptcy or insolvency
are Events of Default which will result in the Securities being due and payable
immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may refuse to
enforce the Indenture or the Securities unless it receives indemnity or security
reasonably satisfactory to it. Subject to certain limitations, Holders of a
majority in principal amount of the Securities may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Securityholders
notice of any continuing Default or Event of Default (except a Default or Event
of Default in payment of principal or interest) if it determines that
withholding notice is in their interest.
15. Trustee Dealings with the Company
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company, the Subsidiary Guarantors or their
affiliates and may otherwise deal with the Company, the Subsidiary Guarantors or
their affiliates with the same rights it would have if it were not Trustee.
16. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company or the Subsidiary Guarantors shall not have any liability for any
obligations of the Company or the Subsidiary Guarantors under the Securities,
the Subsidiary Guarantees or the Indenture or for any claim based on, in respect
of or by reason of such obligations or their creation. By accepting a Security,
each Securityholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Securities.
17. Authentication
This Security shall not be valid until an authorized signatory
of the Trustee (or an authenticating agent acting on its behalf) manually signs
the certificate of authentication on the other side of this Security.
18. Abbreviations
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entirety),
51
JT TEN (=joint tenants with rights of survivorship and not as tenants in
common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
19. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Company has caused CUSIP numbers
to be printed on the Securities and has directed the Trustee to use CUSIP
numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on
the Securities or as contained in any notice of redemption and reliance may be
placed only on the other identification numbers placed thereon.
20. Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK EXCLUDING (TO THE GREATEST
EXTENT PERMISSIBLE BY LAW) ANY RULE OF LAW THAT WOULD CAUSE THE APPLICATION OF
THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
The Company will furnish to any Securityholder upon written
request and without charge to the Securityholder a copy of the Indenture.
Requests may be made to:
Rent-A-Center, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial Officer
52
SUBSIDIARY GUARANTEE
1. Guarantee
The Subsidiary Guarantor, jointly and severally with each
other Subsidiary Guarantor, as a primary obligor and not merely as a surety,
irrevocably and unconditionally Guarantees on an unsecured senior subordinated
basis the performance and punctual payment when due, whether at Stated Maturity,
by acceleration or otherwise, all obligations of the Company under the Indenture
and the Securities, whether for payment of principal of or interest on the
Securities, expenses, indemnification or otherwise all in accordance with the
terms set forth in Article XIV of the Indenture. The Subsidiary Guarantor also
agrees to pay any and all costs and expenses (including reasonably attorney's
fees and expenses) incurred by the Trustee or any Holders in enforcing any
rights under this Subsidiary Guarantee, indemnification or otherwise.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Security upon which
this Subsidiary Guarantee is noted shall have been executed by the Trustee under
the Indenture by the manual signature of one of its authorized officers.
The obligations of the Subsidiary Guarantor shall be limited
to the extent set forth in Article XIV of the Indenture.
This Subsidiary Guarantee shall be governed by and construed
in accordance with the laws of the State of New York without regard to the
principles of conflicts of law to the extent that the application of the law of
another jurisdiction would be required thereby.
This Subsidiary Guarantee is subject to release upon the terms
set forth in the Indenture.
COLORTYME, INC.
By:
---------------------------------
Name:
Title:
53
SUBSIDIARY GUARANTEE
1. Guarantee
The Subsidiary Guarantor, jointly and severally with each
other Subsidiary Guarantor, as a primary obligor and not merely as a surety,
irrevocably and unconditionally Guarantees on an unsecured senior subordinated
basis the performance and punctual payment when due, whether at Stated Maturity,
by acceleration or otherwise, all obligations of the Company under the Indenture
and the Securities, whether for payment of principal of or interest on the
Securities, expenses, indemnification or otherwise all in accordance with the
terms set forth in Article XIV of the Indenture. The Subsidiary Guarantor also
agrees to pay any and all costs and expenses (including reasonably attorney's
fees and expenses) incurred by the Trustee or any Holders in enforcing any
rights under this Subsidiary Guarantee, indemnification or otherwise.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Security upon which
this Subsidiary Guarantee is noted shall have been executed by the Trustee under
the Indenture by the manual signature of one of its authorized officers.
The obligations of the Subsidiary Guarantor shall be limited
to the extent set forth in Article XIV of the Indenture.
This Subsidiary Guarantee shall be governed by and construed
in accordance with the laws of the State of New York without regard to the
principles of conflicts of law to the extent that the application of the law of
another jurisdiction would be required thereby.
This Subsidiary Guarantee is subject to release upon the terms
set forth in the Indenture.
ADVANTAGE COMPANIES, INC.
By:
---------------------------------
Name:
Title:
54
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
(Print or type assignee's name, address and zip code)
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Security on the books of
the Company. The agent may substitute another to act for him.
--------------------------------------------------------------------------------
Date: Your Signature:
-------------------- --------------------
Signature Guarantee:
-------------------------------------
(Signature must be guaranteed)
--------------------------------------------------------------------------------
Sign exactly as your name appears on the other side of this Security.
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in the Securities Transfer Agents Medallion Program ("STAMP") or such
other signature guarantee medallion program as may be approved by the Security
Registrar in addition to or substitution for, STAMP), pursuant to S.E.C. Rule
17Ad-15.
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the date that is two years after the
later of the date of original issuance of such Securities and the last date, if
any, on which such Securities were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Securities are being:
CHECK ONE BOX BELOW:
[ ] 1 acquired for the undersigned's own account, without transfer;
or
[ ] 2 transferred to the Company; or
[ ] 3 transferred pursuant to and in compliance with Rule 144A under
the Securities Act of 1933; or
[ ] 4 transferred pursuant to an effective registration statement
under the Securities Act; or
[ ] 5 transferred pursuant to and in compliance with Regulation S
under the Securities Act of 1933; or
55
[ ] 6 transferred to an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act of 1933), that has furnished to the Trustee a
signed letter containing certain representations and
agreements (the form of which letter appears as Exhibit E to
the Indenture); or
[ ] 7 transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee may refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered holder thereof; provided, however, that if box (5), (6) or
(7) is checked, the Trustee or the Company may require, prior to registering any
such transfer of the Securities, in their sole discretion, such legal opinions,
certifications and other information as the Trustee or the Company may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided by
Rule 144 under such Act.
---------------------------------
Signature
Signature Guarantee:
------------------------------ ---------------------------------
(Signature must be guaranteed) Signature
------------------------------------------------------------
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions) with
membership in the Securities Transfer Agents Medallion Program ("STAMP") or such
other signature guarantee medallion program as may be approved by the Note
Registrar in addition to or substitution for STAMP, pursuant to S.E.C. Rule
17Ad-15.
56
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The following increases or decreases in this Global Note have been made:
Principal Amount of Signature of
Amount of decrease in Amount of increase in this Global Note authorized signatory
Date of Principal Amount of Principal Amount of following such of Trustee or Notes
Exchange this Global Note this Global Note decrease or increase Custodian
57
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 1016 or 1017 of the Indenture, check the box:
[ ]
If you want to elect to have only part of this Security
purchased by the Company pursuant to Section 1016 or 1017 of the Indenture,
state the amount in principal amount (must be integral multiple of $1,000): $
--------------------------------------------------------------------------------
Date: Your Signature:
-------------------- --------------------
Signature Guarantee:
-------------------------------------
(Signature must be guaranteed)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions) with
membership in the Securities Transfer Agents Medallion Program ("STAMP") or such
other signature guarantee medallion program as may be approved by the Note
Registrar in addition to or substitution for STAMP, pursuant to S.E.C. Rule
17Ad-15.
58
SECTION 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in
substantially the following form:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
This is one of the Securities referred to in the
within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By
--------------------------
Authorized Signatory
Dated: , 200
--------- -
59
ARTICLE THREE.
THE SECURITIES
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited; provided that the aggregate
principal amount of $100,000,000 of the Series C Notes (the "Initial Series C
Notes") shall be issued on the date hereof.
The Series C Notes shall be known and designated as the "11% Senior Subordinated
Notes due 2008, Series C" of the Company. The Series D Notes shall be known and
designated as the "11% Senior Subordinated Notes due 2008, Series D" of the
Company. The Stated Maturity of the Securities shall be August 15, 2008, and
they shall bear interest at the rate of 11% per annum from December 19, 2001, or
from the most recent interest payment date to which interest has been paid or
duly provided for, payable semiannually in cash and in arrears to the Person in
whose name the Security (or any predecessor Security) is registered at the close
of business on the February 1 and August 1 immediately preceding the interest
payment date on February 15 and August 15 of each year, commencing the first
February 15 or August 15 following the date such Security was originally issued.
Interest will be computed on the basis of a 360-day year comprised of twelve
30-day months, until the principal thereof is paid or duly provided for.
Interest on any overdue principal, interest (to the extent lawful) or premium,
if any, shall be payable on demand.
The principal of (and premium, if any) and interest on the
Securities shall be payable at the office or agency of the Company maintained
for such purpose in The City of New York, or at such other office or agency of
the Company as may be maintained for such purpose; provided, however, that, at
the option of the Company, interest may be paid by check mailed to addresses of
the Persons entitled thereto as such addresses shall appear on the Note
Register.
Holders shall have the right to require the Company to
purchase their Securities, in whole or in part, in the event of a Change of
Control pursuant to Section 1016.
The Securities shall be subject to repurchase by the Company
pursuant to an Asset Disposition as provided in Section 1017.
The Securities shall be redeemable as provided in Article
Eleven and in the Securities.
The Indebtedness evidenced by the Securities shall be
subordinated in right of payment to Senior Indebtedness as provided in Article
Thirteen.
SECTION 302. Denominations.
The Securities shall be issuable only in fully registered
form, without coupons, and only in denominations of $1,000 and any integral
multiple thereof.
60
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by
two Officers, of which at least one Officer shall be the President or the Chief
Financial Officer of the Company. The signature of any Officer on the Securities
may be manual or facsimile signatures of the present or any future such
authorized officer and may be imprinted or otherwise reproduced on the
Securities.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities. The Trustee shall authenticate
(i) the Initial Series C Notes for original issue on the date hereof in the
aggregate principal amount of $100,000,000, (ii) the additional Series C Notes
for original issue from time to time after the date hereof in such principal
amounts as may be set forth in a Company Order and (iii) the Series D Notes for
original issue from time to time for issue only in exchange for a like principal
amount of Series C Notes, in each case upon a Company Order. In each case, the
Trustee shall be provided with an Officers' Certificate certifying that all
conditions precedent to the issuance of Securities contained herein have been
fully complied with and an Opinion of Counsel of the Company in connection with
such authentication of Securities. Such order shall specify (a) the series of
the Securities, (b) the amount of Securities to be authenticated and (c) the
date on which the original issue of Series C Notes or Series D Notes is to be
authenticated.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein duly executed by the Trustee by manual signature of an authorized
signatory, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder and is entitled to the benefits of this Indenture.
In case the Company or any Subsidiary Guarantor, pursuant to
Article Eight, shall be consolidated or merged with or into any other Person or
shall convey, transfer, lease or otherwise dispose of its properties and assets
substantially as an entirety to any Person, and the successor Person resulting
from such consolidation, or surviving such merger, or into which the Company or
such Subsidiary Guarantor shall have been merged, or the Person which shall have
received a conveyance, transfer, lease or other disposition as aforesaid, shall
have executed an indenture supplemental hereto with the Trustee pursuant to
Article Eight, any of the Securities authenticated or delivered prior to such
consolidation, merger, conveyance, transfer, lease or other disposition may,
from time to time, at the request of the successor Person, be exchanged for
other Securities executed in the name of the successor Person with such changes
in
61
phraseology and form as may be appropriate, but otherwise in substance of like
tenor as the Securities surrendered for such exchange and of like principal
amount; and the Trustee, upon Company Request of the successor Person, shall
authenticate and deliver Securities as specified in such request for the purpose
of such exchange. If Securities shall at any time be authenticated and delivered
in any new name of a successor Person pursuant to this Section 303 in exchange
or substitution for or upon registration of transfer of any Securities, such
successor Person, at the option of the Holders but without expense to them,
shall provide for the exchange of all Securities at the time Outstanding for
Securities authenticated and delivered in such new name.
The Trustee may appoint an authenticating agent acceptable to
the Company to authenticate Securities on behalf of the Trustee. Unless limited
by the terms of such appointment, an authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Note Registrar or Paying Agent
to deal with the Company and its Affiliates.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination. Temporary Securities
shall be substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as conclusively evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for such purpose
pursuant to Section 1002, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Securities of authorized denominations. Until so
exchanged, the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities.
SECTION 305. Registration, Registration of Transfer and
Exchange.
The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such office and in
any other office or agency designated pursuant to Section 1002 being herein
sometimes referred to as the "Note Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Note Register
shall be in written form or any other form capable of being converted into
written form within a reasonable time. At all reasonable times, the Note
Register shall be open to inspection by the Trustee. The Trustee is hereby
initially appointed as security registrar (the Trustee in such capacity,
together
62
with any successor of the Trustee in such capacity, the "Note Registrar") for
the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at
the office or agency of the Company designated pursuant to Section 1002, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
any authorized denomination or denominations of a like aggregate principal
amount.
Furthermore, any Holder of a Global Note shall, by acceptance
of such Global Note, agree that transfers of beneficial interest in such Global
Note may be effected only through a book-entry system maintained by the Holder
of such Global Note (or its agent), and that ownership of a beneficial interest
in the Security shall be required to be reflected in a book entry.
At the option of the Holder, Securities may be exchanged for
other Securities of any authorized denomination and of a like aggregate
principal amount, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange
(including an exchange of Series C Notes for Series D Notes), the Company shall
execute, and the Trustee shall authenticate and deliver, the Securities which
the Holder making the exchange is entitled to receive; provided that no exchange
of Series C Notes for Series D Notes shall occur until an applicable Exchange
Offer Registration Statement shall have been declared effective by the
Commission, the Trustee shall have received an Officers' Certificate confirming
that the Exchange Offer Registration Statement has been declared effective by
the Commission and the Series C Notes to be exchanged for the Series D Notes
shall be cancelled by the Trustee.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Note
Registrar) be duly endorsed, or be accompanied by a written instrument of
transfer, in form satisfactory to the Company and the Note Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange or redemption of Securities, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 906, 1016, 1017 or
1108, not involving any transfer.
The Register shall be in written form in the English language
or in any other form including computerized records, capable of being converted
into such form within a reasonable time.
63
SECTION 306. Book-Entry Provisions for Global Notes.
(a) Each Global Note initially shall (i) be registered in the
name of the Depositary for such Global Note or the nominee of such Depositary,
(ii) be delivered to the Trustee as custodian for such Depositary and (iii) bear
legends as set forth in Section 202.
Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Note held on their behalf by the Depositary, or the Trustee as its custodian, or
under the Global Note, and the Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner of
such Global Note for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or
other authorization furnished by the Depositary or shall impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a Holder of any Security.
(b) Transfers of a Global Note shall be limited to transfers
of such Global Note in whole, but not in part, to the Depositary, its successors
or their respective nominees. Interests of beneficial owners in a Global Note
may be transferred in accordance with the rules and procedures of the Depositary
and the provisions of Section 307. If required to do so pursuant to any
applicable law or regulation, beneficial owners may obtain Securities in
definitive form ("Physical Notes") in exchange for their beneficial interests in
a Global Note upon written request in accordance with the Depositary's and the
Registrar's procedures. In addition, Physical Notes shall be transferred to all
beneficial owners in exchange for their beneficial interests in a Global Note if
(i) the Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for such Global Note or the Depositary ceases to be a
clearing agency registered under the Exchange Act, at a time when the Depositary
is required to be so registered in order to act as Depositary, and in each case
a successor depositary is not appointed by the Company within 90 days of such
notice, (ii) the Company executes and delivers to the Trustee and Note Registrar
an Officers' Certificate stating that such Global Note shall be so exchangeable
or (iii) an Event of Default has occurred and is continuing and the Note
Registrar has received a request from the Depositary.
(c) In connection with any transfer of a portion of the
beneficial interest in a Global Note pursuant to subsection (b) of this Section
to beneficial owners who are required to hold Physical Notes, the Note Registrar
shall reflect on its books and records the date and a decrease in the principal
amount of such Global Note in an amount equal to the principal amount of the
beneficial interest in the Global Note to be transferred, and the Company shall
execute, and the Trustee shall authenticate and deliver, one or more Physical
Notes of like tenor and amount.
(d) In connection with the transfer of an entire Global Note
to beneficial owners pursuant to subsection (b) of this Section, such Global
Note 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 Depositary in exchange for its beneficial
interest in such Global Note, an equal aggregate principal amount of Physical
Notes of authorized denominations.
64
(e) Any Physical Note delivered in exchange for an interest in
a Global Note pursuant to subsection (c) or subsection (d) of this Section
shall, except as otherwise provided by paragraph (a)(i)(x) and paragraph (f) of
Section 307, bear the applicable legend regarding transfer restrictions
applicable to the Physical Note set forth in Section 202.
(f) The registered holder of a Global Note may grant proxies
and otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
SECTION 307. Special Transfer Provisions.
(a) The following provisions shall apply with respect to any
proposed transfer of a Rule 144A Note or an Institutional Accredited Investor
Note prior to the expiration of the Resale Restriction Termination Date (as
defined in Section 202 hereof):
(i) a transfer of a Rule 144A Note or an
Institutional Accredited Investor Note or a beneficial interest therein
to a QIB shall be made upon the representation of the transferee 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 "qualified institutional buyer" within the
meaning of Rule 144A under the Securities Act of 1933, as amended, and
is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the
Company as the undersigned 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;
(ii) a transfer of a Rule 144A Note or an
Institutional Accredited Investor Note or a beneficial interest therein
to an institutional accredited investor shall be made upon receipt by
the Trustee or its agent of a certificate substantially in the form set
forth in Section 308 hereof from the proposed transferee and, if
requested by the Company or the Trustee, the delivery of an opinion of
counsel, certification and/or other information satisfactory to each of
them; and
(iii) a transfer of a Rule 144A Note or an
Institutional Accredited Investor Note or a beneficial interest therein
to a Non-U.S. Person shall be made upon receipt by the Trustee or its
agent of a certificate substantially in the form set forth in Section
309 hereof from the proposed transferee and, if requested by the
Company or the Trustee, the delivery of an opinion of counsel,
certification and/or other information satisfactory to each of them.
(b) The following provisions shall apply with respect to any
proposed transfer of a Regulation S Note prior to the expiration of the
Restricted Period:
(i) a transfer of a Regulation S Note or a beneficial
interest therein to a QIB shall be made upon the representation of the
transferee that it is purchasing the Security for its own account or an
account with respect to which it exercises sole
65
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, as amended, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that it has
received such information regarding the Company as the undersigned 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;
(ii) a transfer of a Regulation S Note or a
beneficial interest therein to an institutional accredited investor
shall be made upon receipt by the Trustee or its agent of a certificate
substantially in the form set forth in Section 308 hereof from the
proposed transferee and, if requested by the Company or the Trustee,
the delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them; and
(iii) a transfer of a Regulation S Note or a
beneficial interest therein to a Non-U.S. Person shall be made upon, if
requested by the Company or the Trustee, receipt by the Trustee or its
agent of an opinion of counsel, certification and/or other information
satisfactory to each of them.
After the expiration of the Restricted Period, interests in
the Regulation S Note may be transferred without requiring certification set
forth in Section 308 or any additional certification.
(c) Private Placement Legend. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the Note
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 Note Registrar shall deliver only Securities that
bear the Private Placement Legend unless there is delivered to the Note
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.
(d) 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 Security set forth in this Indenture and in the
Private Placement Legend and agrees that it will transfer such Security only as
provided in this Indenture.
(e) The Company shall deliver to the Trustee an Officers'
Certificate setting forth the dates on which the Restricted Period terminates
(the "Resale Restriction Termination Date").
The Note Registrar shall retain copies of all letters, notices
and other written communications received pursuant to Section 306 or this
Section 307. The Company shall have the right to inspect and make copies of all
such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Note Registrar.
(f) No Obligation of the Trustee: The Trustee shall have no
responsibility or obligation to any beneficial owner of a Global Note, a member
of, or a
66
participant in the Depository or other Person with respect to any ownership
interest in the Securities, with respect to the accuracy of the records of the
Depository or its nominee or of any participant or member thereof or with
respect to the delivery to any participant, member, beneficial owner or other
Person (other than the Depository) of any notice (including any notice of
redemption) or the payment of any amount, under or with respect to such
Securities. All notices and communications to be given to the Holders and all
payments to be made to Holders under the Securities shall be given or made only
to the registered Holders (which shall be the Depository or its nominee in the
case of a Global Note). The rights of beneficial owners in any Global Note in
global form shall be exercised only through the Depository subject to the
applicable rules and procedures of the Depository. The Trustee may rely and
shall be fully protected and indemnified pursuant to Section 607 in relying upon
information furnished by the Depository with respect to any beneficial owners,
its members and participants.
(ii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including without limitation any
transfers between or among Depository participants, members or beneficial owners
in any Global Note) other than to require delivery of such certificates and
other documentation of evidence as are expressly required by, and to do so if
and when expressly required by, the terms of this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.
SECTION 308. Form of Certificate to Be Delivered in Connection
with Transfers to Institutional Accredited Investors.
[date]
RENT-A-CENTER, INC.
THE BANK OF NEW YORK, as Trustee
[________]
[________]
Attention: Corporate Trust Department
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $______
principal amount of the 11% Senior Subordinated Notes due 2008, Series C (the
"Securities") of Rent-A-Center, Inc. (the "Company").
Upon transfer, the Securities would be registered in the name
of the new beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
67
The undersigned represents and warrants to you that:
(1) We are an institutional "accredited investor" (as defined
in Rules 501(a)(1), (2), (3) and (7) under the Securities Act of 1933, as
amended (the "Securities Act")), purchasing for our own account or for the
account of an institutional "accredited investor" at least $250,000 principal
amount of the Securities, and we are acquiring the Securities not with a view
to, or for offer or sale in connection with, any distribution in violation of
the Securities Act. We have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Securities and invest in or purchase securities similar to the
Securities in the normal course of our business. We and any accounts for which
we are acting are each able to bear the economic risk of our or its investment.
(2) We understand that the Securities have not been registered
under the Securities Act and, unless so registered, may not be sold except as
permitted in the following sentence. We agree on our own behalf and on behalf of
any investor account for which we are purchasing Securities to offer, sell or
otherwise transfer such Securities prior to the date which is two years after
the later of the date of original issue and the last date on which the Company
or any affiliate of the Company was the owner of such Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date") only (a) to the
Company, (b) pursuant to a registration statement which has been declared
effective under the Securities Act, (c) in a transaction complying with the
requirements of Rule 144A under the Securities Act, to a person we reasonably
believe is a qualified institutional buyer under Rule 144A (a "QIB") that
purchases for its own account or for the account of a QIB and to whom notice is
given that the transfer is being made in reliance on Rule 144A, (d) pursuant to
offers and sales that occur outside the United States within the meaning of
Regulation S under the Securities Act, (e) to an institutional "accredited
investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act that is purchasing for its own account or for the account of such
an institutional "accredited investor", in each case in a minimum principal
amount of Securities of $250,000 or (f) pursuant to any other available
exemption from the registration requirements of the Securities Act, subject in
each of the foregoing cases to any requirement of law that the disposition of
our property or the property of such investor account or accounts be at all
times within our or their control and in compliance with any applicable state
securities laws. The foregoing restrictions on resale will not apply subsequent
to the Resale Restriction Termination Date. If any resale or other transfer of
the Securities is proposed to be made pursuant to clause (e) above prior to the
Resale Restriction Termination Date, the transferor shall deliver a letter from
the transferee substantially in the form of this letter to the Company and the
Trustee, which shall provide, among other things, that the transferee is an
institutional "accredited investor" within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act and that it is acquiring such Securities for
investment purposes and not for distribution in violation of the Securities Act.
Each purchaser acknowledges that the Company and the Trustee reserve the right
prior to any offer, sale or other transfer prior to the Resale Termination Date
of the Securities pursuant to clauses (d), (e) or (f) above to require the
delivery of an opinion of counsel, certifications and/or other information
satisfactory to the Company and the Trustee.
TRANSFEREE:
BY:
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Upon transfer the Securities would be registered in the name of the new
beneficial owner as follows:
NAME ADDRESS TAXPAYER ID NUMBER:
Very truly yours,
[Name of Transferor]
By:
------------------------------ ---------------------------------
Name: Signature Medallion Guaranteed
Title:
SECTION 309. Form of Certificate to Be Delivered in Connection
with Transfers Pursuant to Regulation S.
[date]
The Bank of New York, as Trustee
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Re: RENT-A-CENTER, INC. (the "Company")
11% Senior Subordinated Notes due 2008 (the
"Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $________ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the United States
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
represent that:
(a) the offer of the Securities was not made to a person in
the United States;
(b) either (i) at the time the buy order was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the
United States or (ii) the transaction was executed in, on or through
the facilities of a designated off-shore securities market and neither
we nor any person acting on our behalf knows that the transaction has
been pre-arranged with a buyer in the United States;
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(c) no directed selling efforts have been made in the United
States in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S, as applicable; and
(d) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act.
In addition, if the sale is made during a restricted period
and the provisions of Rule 903(c)(3) or Rule 904(c)(1) of Regulation S are
applicable thereto, we confirm that such sale has been made in accordance with
the applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case may
be.
You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Terms used in this certificate have
the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
-------------------- -------------------------------
Authorized Signature Signature Medallion Guaranteed
SECTION 310. Mutilated, Destroyed, Lost and Stolen Securities.
If (i) any mutilated Security is surrendered to the Trustee,
or (ii) the Company and the Trustee receive evidence to their satisfaction of
the destruction, loss or theft of any Security, and there is delivered to the
Company, each Subsidiary Guarantor and the Trustee such security or indemnity,
in each case, as may be required by them to save each of them harmless, then, in
the absence of notice to the Company any Subsidiary Guarantor or the Trustee
that such Security has been acquired by a bona fide purchaser, the Company shall
execute and upon Company Order the Trustee shall authenticate and deliver, in
exchange for any such mutilated Security or in lieu of any such destroyed, lost
or stolen Security, a new Security of like tenor and principal amount, bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) in connection
therewith.
Every new Security issued pursuant to this Section in lieu of
any mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, any Guarantor and any other
obligor upon the Securities, whether or not the
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mutilated, destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 311. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually
paid or duly provided for, on any interest payment date shall be paid to the
Person in whose name such Security (or one or more predecessor Securities) is
registered at the close of business on the Regular Record Date for such interest
at the office or agency of the Company maintained for such purpose pursuant to
Section 1002; provided, however, that each installment of interest may at the
Company's option be paid by (i) mailing a check for such interest, payable to or
upon the written order of the Person entitled thereto pursuant to Section 312,
to the address of such Person as it appears in the Note Register or (ii) wire
transfer to an account located in the United States maintained by the payee.
Any interest on any Security which is payable, but is not paid
when the same becomes due and payable and such nonpayment continues for a period
of 30 days shall forthwith cease to be payable to the Holder on the Regular
Record Date by virtue of having been such Holder, and such defaulted interest
and (to the extent lawful) interest on such defaulted interest at the rate borne
by the Securities (such defaulted interest and interest thereon herein
collectively called "Defaulted Interest") shall be paid by the Company, at its
election in each case, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security and the date (not less than 30
days after such notice) of the proposed payment (the "Special Interest
Payment Date"), and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Trustee shall fix a record date (the
"Special Record Date") for the payment of such Defaulted Interest which
shall be not more than 15 days and not less than 10 days prior to the
Special Interest Payment Date and not less than 10 days after the
receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date,
and in the name and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date and Special Interest Payment Date therefor to be given in
the manner provided for in Section 106, not less
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than 10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date and
Special Interest Payment Date therefor having been so given, such
Defaulted Interest shall be paid on the Special Interest Payment Date
to the Persons in whose names the Securities (or their respective
predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following clause (b).
(b) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon
such notice as may be required by such exchange, if, after notice given
by the Company to the Trustee of the proposed payment pursuant to this
clause, such manner of payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
SECTION 312. Persons Deemed Owners.
Prior to the due presentment of a Security for registration of
transfer, the Company, the Trustee and any agent of the Company, any Subsidiary
Guarantor or the Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment of
principal of (and premium, if any) and (subject to Sections 305 and 311)
interest on such Security and for all other purposes whatsoever, whether or not
such Security be overdue, and none of the Company, any Subsidiary Guarantor, the
Trustee nor any agent of the Company, any Subsidiary Guarantor or the Trustee
shall be affected by notice to the contrary.
SECTION 313. Cancellation.
All Securities surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee and shall be promptly cancelled by
it. If the Company shall acquire any of the Securities other than as set forth
in the preceding sentence, the 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 313. No Securities shall be authenticated in lieu of or in exchange for
any Securities cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by the Trustee shall
be disposed of by the Trustee as directed by a Company Order; provided however
that the Trustee shall not be required to destroy any such Security.
SECTION 314. Computation of Interest.
Interest on the Securities shall be computed on the basis of a
360-day year of twelve 30-day months.
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SECTION 315. CUSIP Numbers.
The Company in issuing Securities may use "CUSIP" numbers (if
then generally in use) in addition to serial numbers; if so, the Trustee shall
use such "CUSIP" numbers in addition to serial numbers in notices of redemption
and repurchase as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such CUSIP
numbers, either as printed on the Securities or as contained in any notice of a
redemption or repurchase and that reliance may be placed only on the serial or
other identification numbers printed on the Securities, and any such redemption
or repurchase shall not be affected by any defect in or omission of such CUSIP
numbers. The Company will promptly notify the Trustee of any change in the CUSIP
numbers.
ARTICLE FOUR.
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of
further effect (except as to surviving rights of registration of transfer or
exchange of Securities expressly provided for herein or pursuant hereto) and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture when
(i) either
(A) all Securities theretofore authenticated and
delivered (other than (1) Securities which have been lost,
stolen or destroyed and which have been replaced or paid as
provided in Section 310 and (2) Securities for whose payment
money has theretofore been deposited in trust with the Trustee
or any Paying Agent or segregated and held in trust by the
Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 1003) have been
delivered to the Trustee for cancellation; or
(B) all Securities not theretofore delivered to the
Trustee for cancellation
(1) have become due and payable by reason of
the making of a notice of redemption or otherwise; or
(2) will become due and payable at their
Stated Maturity within one year; or
(3) are to be called for redemption within
one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the
Company,
73
and the Company in the case of (1), (2) or (3) above, has
irrevocably deposited or caused to be deposited with the
Trustee as trust funds in trust for such purpose an amount in
cash or Government Obligations sufficient to pay and discharge
the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal of
(and premium, if any) and interest to the date of such deposit
(in the case of Securities which have become due and payable)
or to the Stated Maturity or Redemption Date, as the case may
be;
(ii) no Default or Event of Default with respect to
this Indenture or the Securities shall have occurred and be continuing
on the date of such deposit or shall occur as a result of such deposit
and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument or agreement to which
the Company or any Subsidiary Guarantor of the Securities is a party or
by which it is bound;
(iii) the Company or any Subsidiary Guarantor has
paid or caused to be paid all sums payable hereunder by the Company or
any Subsidiary Guarantor in connection with all the Securities
including all fees and expenses of the Trustee;
(iv) the Company has delivered irrevocable
instructions to the Trustee to apply the deposited money toward the
payment of such Securities at maturity or the Redemption Date, as the
case may be; and
(v) the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture and the termination of the Company's
obligation hereunder have been satisfied.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 607 and,
if money shall have been deposited with the Trustee pursuant to subclause (B) of
clause (i) of this Section, the obligations of the Trustee under Section 402 and
the last paragraph of Section 1003 shall survive any such satisfaction and
discharge.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section
1003, all money deposited with the Trustee pursuant to Section 401 shall be held
in trust and applied by it, in accordance with the provisions of the Securities
and this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law. If the Trustee or Paying Agent is unable to apply any
money or Government Obligations in accordance with Section 401 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, the Company's and any Guarantor's obligations under this Indenture
and the Securities shall be revived and reinstated as though no deposit had
occurred pursuant to Section 401; provided that
74
if the Company has made any payment of principal of, premium, if any, or
interest on 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 money or U.S. Government Obligations held by the
Trustee or Paying Agent.
ARTICLE FIVE.
REMEDIES
SECTION 501. Events of Default.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be occasioned by the provisions of Article 13 or be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) default in any payment of interest on any
Security when the same becomes due and such default continues for a
period of 30 days whether or not such payment shall be prohibited by
Article Thirteen;
(ii) default in the payment of the principal of any
Security when the same becomes due at its Stated Maturity, upon
optional redemption, upon required repurchase, upon declaration or
otherwise, whether or not such payment shall be prohibited by Article
Thirteen;
(iii) the Company fails to comply with Section 801;
(iv) the Company fails to comply with Section 1003,
1009, 1010, 1011, 1012, 1013, 1014, 1015, 1016, 1017, 1019, 1020 or
1022 (other than a failure to purchase Securities when required under
Section 1016 or 1017) and such failure continues for 30 days after the
notice specified below;
(v) the Company fails to comply with any of its
agreements in the Securities or this Indenture (other than those
referred to in (i), (ii), (iii) or (iv) above) and such failure
continues for 60 days after the notice specified below;
(vi) Indebtedness of the Company or any Significant
Subsidiary is not paid within any applicable grace period after final
maturity or the acceleration by the holders thereof because of a
default and the total amount of such Indebtedness unpaid or accelerated
exceeds $25 million;
(vii) the Company or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case;
75
(B) consents to the entry of an order for relief
against it in an involuntary case;
(C) consents to the appointment of a custodian of it
or for any substantial part of its property;
(D) makes a general assignment for the benefit of its
creditors; or takes any comparable action under any foreign
laws relating to insolvency; or
(viii) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary in an involuntary case;
(B) appoints a custodian of the Company or any
Significant Subsidiary or for any substantial part of its
property; or
(C) orders the winding up or liquidation of the
Company or any Significant Subsidiary;
or any similar relief is granted under any foreign laws and the order
or decree remains unstayed and in effect for 90 days;
(ix) any judgment or decree for the payment of money
in excess of $25 million (net of any insurance or indemnity payments
actually received in respect thereof prior to or within 90 days from
the entry thereof, or to be received in respect thereof in the event
any appeal thereof shall be unsuccessful) is rendered against the
Company or any Significant Subsidiary that is not discharged, or bonded
or insured by a third Person and either (A) an enforcement proceeding
has been commenced upon such judgment or decree or (B) such judgment or
decree remains outstanding for a period of 90 days following the entry
of such judgment or decree and is not discharged, waived or stayed; or
(x) the failure of any Guarantee of the Securities by
a Subsidiary Guarantor to be in full force and effect (except as
contemplated by the terms thereof or of this Indenture) or the denial
or disaffirmation in writing by any such Subsidiary Guarantor of its
obligations under this Indenture or any such Guarantee of the
Securities if such Default continues for 10 days.
The foregoing will constitute Events of Default whatever the
reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order
of any court or any order, rule or regulation of any administrative or
governmental body.
A Default under clause (iv) or (v) above shall not constitute
an Event of Default until the Trustee or the Holders of at least 25% in
principal amount of the outstanding Securities
76
notify the Company of the Default and the Company does not cure such Default
within the time specified in clause (iv) or (v), as the case may be, after
receipt of such notice. Such notice must specify the Default, demand that it be
remedied and state that such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of any event which with the giving of notice or the lapse of time would become
an Event of Default under clause (iv), (v) or (viii) above, its status and what
action the Company is taking or proposes to take with respect thereto.
If a Default occurs and is continuing and is actually known to
a Trust Officer of the Trustee, the Trustee must mail to each Holder notice of
the Default within 90 days after it occurs. Except in the case of a Default in
the payment of principal of, premium, if any, or interest on any Security, the
Trustee may withhold such notice if and so long as a committee of its Trust
Officers in good faith determines that withholding notice is in the interests of
the Holders. In addition, the Company is required to deliver to the Trustee,
within 120 days after the end of each fiscal year, a certificate indicating
whether the signers thereof know of any Default that occurred during the
previous year.
SECTION 502. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default (other than by reason of an Event of
Default specified in Section 501(vii) or 501(viii)) occurs and is continuing,
the Trustee by written notice to the Company, or the Holders of at least a
majority in principal amount of the outstanding Securities, by written notice to
the Company and the Trustee, may declare the principal (and premium, if any) and
accrued and unpaid interest on all such then outstanding Securities to be due
and payable immediately. Upon the effectiveness of such declaration, such
principal (and premium, if any) and interest will be due and payable
immediately. Notwithstanding the foregoing, in the case of an Event of Default
specified in Section 501(vii) or 501(viii) occurs and is continuing, then the
principal amount of, and interest on, all 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.
The Holders of a majority in principal amount of the
outstanding Securities by notice to the Trustee may rescind an acceleration and
its consequences if the rescission would not conflict with any judgment or
decree and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has become due solely because of
acceleration. The Trustee may rely upon such notice of rescission without any
independent investigation as to the satisfaction of the conditions in the
preceding sentence. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.
If an Event of Default specified in Section 501(i) or 501(ii)
occurs and is continuing, the Trustee, in its own name as trustee of an express
trust, may institute a judicial proceeding for the collection of the sums so due
and unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company or any Subsidiary
77
Guarantor (in accordance with the applicable Subsidiary Guarantee) and collect
the moneys adjudged or decreed to be payable in the manner provided by law out
of the property of the Company or any Subsidiary Guarantor, wherever situated.
If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders under this Indenture or any Guarantee of the Securities by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, including, seeking recourse against any
Subsidiary Guarantor pursuant to the terms of any Subsidiary Guarantee, whether
for the specific enforcement of any covenant or agreement in this Indenture or
in aid of the exercise of any power granted herein, or to enforce any other
proper remedy including, without limitation, seeking recourse against any
Subsidiary Guarantor pursuant to the terms of its Subsidiary Guarantee, or to
enforce any other proper remedy, subject however to Section 513. No recovery of
any such judgment upon any property of the Company or any Subsidiary Guarantor
shall affect or impair any rights, powers or remedies of the Trustee or the
Holders.
SECTION 504. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor,
including any Subsidiary Guarantor, upon the Securities or the property of the
Company, the Subsidiary Guarantors or of such other obligor or their creditors,
the Trustee (irrespective of whether the principal of the Securities shall then
be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of overdue principal, premium, if any, or interest) shall be
entitled and empowered, by intervention in such proceeding or otherwise,
(i) to file proofs of claim for the whole amount of
principal (and premium, if any) and interest owing and unpaid in
respect of the Securities, to take such other actions (including
participating as a member, voting or otherwise, of any official
committee of creditors appointed in such matter) and to file such other
papers or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel) and of the Holders allowed in such judicial
proceeding, and
(ii) to collect and receive any moneys or other
property payable or deliverable on any such claims and to distribute
the same;
and any custodian in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement,
78
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Holder in any such proceeding; provided, however, that the Trustee may, on
behalf of such Holders, vote for the election of a trustee in bankruptcy or
other similar official.
SECTION 505. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture, the
Securities or the Subsidiary Guarantees may be prosecuted and enforced by the
Trustee without the possession of any of the Securities or the production
thereof in any proceeding relating thereto, and any such proceeding instituted
by the Trustee shall be brought in its own name and as trustee of an express
trust, and any recovery of judgment shall, after provision for the payment of
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of the Holders of
the Securities in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Subject to Article Thirteen, any money collected by the
Trustee pursuant to this Article shall be applied in the following order, at the
date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal (or premium, if any) or interest, upon
presentation of the Securities and the notation thereon of the payment if only
partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607;
SECOND: To holders of Senior Indebtedness to the extent
required by Article Thirteen;
THIRD: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Securities in
respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Securities for
principal (and premium, if any) and interest, respectively; and
FOURTH: The balance, if any, to the Company or as a court of
competent jurisdiction may direct, provided that all sums due and owing
to the Holders and the Trustee have been paid in full as required by
this Indenture.
SECTION 507. Limitation on Suits.
No Holder of any Securities shall have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture, or for
the appointment of a receiver or trustee, or for any other remedy hereunder,
unless
(i) the Holder gives to the Trustee written notice
stating that an Event of Default is continuing;
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(ii) the Holders of at least 25% in principal amount
of the outstanding Securities make a written request to the Trustee to
pursue the remedy;
(iii) such Holder or Holders offer to the Trustee
reasonable security or indemnity satisfactory to it against any loss,
liability or expense;
(iv) the Trustee does not comply with the request
within 60 days after receipt of the request and the offer of security
or indemnity; and
(v) the Holders of a majority in principal amount of
the outstanding Securities do not give the Trustee a direction
inconsistent with the request during such 60-day period.
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture, any Security or any Subsidiary Guarantee to affect, disturb or
prejudice the rights of any other Holders, or to obtain or to seek to obtain
priority or preference over any other Holders or to enforce any right under this
Indenture, any Security or any Subsidiary Guarantee, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture (other
than Article XIII), the Holder of any Security shall have the right, which is
absolute and unconditional, to receive payment, as provided herein (including,
if applicable, Article Eleven) and in such Security of the principal of (and
premium, if any) and (subject to Section 311) interest on such Security on the
respective Stated Maturities expressed in such Security (or, in the case of
redemption or repurchase, on the Redemption Date or repurchase) and to institute
suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture or any Guarantee of the
Securities and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company, any Subsidiary Guarantor, any other obligor on the Securities, the
Trustee and the Holders shall be restored severally and respectively to their
former positions hereunder, and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 310, 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
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by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders may be exercised from time to time, and as often
as may be deemed expedient, by the Trustee or by the Holders, as the case may
be.
SECTION 512. Control by Holders.
The Holders of not less than a majority in principal amount of
the Outstanding Securities shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, provided that
(i) such direction shall not be in conflict with any
rule of law or with this Indenture or any Subsidiary Guarantee,
(ii) the Trustee need not take any action which might
involve it in personal liability or be unduly prejudicial to the
Holders not consenting, it being understood that (subject to Section
601) the Trustee shall have no duty to ascertain whether or not such
actions or forbearance are unduly prejudicial to such Holders; and
(iii) subject to the provisions of Section 315 of the
Trust Indenture Act, the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction.
Prior to taking any action hereunder, the Trustee shall be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
SECTION 513. Waiver of Past Defaults.
Subject to Sections 508 and 902, the Holders of a majority in
aggregate principal amount of the Outstanding Securities (including consents
obtained in connection with a tender offer or exchange offer for the Securities)
may on behalf of the Holders of all the Securities, by written notice to the
Trustee, waive any existing Default or Event of Default and its consequences
under this Indenture or any Subsidiary Guarantee except a continuing Default or
Event of Default in the payment of interest on, premium, if any, or the
principal of, any such Security held by a non-consenting Holder, or in respect
of a covenant or a provision which cannot be amended or modified without the
consent of all Holders.
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In the event that any Event of Default specified in Section
501(vi) shall have occurred and be continuing, such Event of Default and all
consequences thereof (including without limitation any acceleration or resulting
payment default) shall be annulled, waived and rescinded, automatically and
without any action by the Trustee or the Holders of the Securities, if within 30
days after such Event of Default arose (i) the Indebtedness that is the basis
for such Event of Default has been discharged, or (ii) the holders thereof have
rescinded or waived the acceleration, notice or action (as the case may be)
giving rise to such Event of Default, or (iii) if the Default that is the basis
for such Event of Default has been cured.
Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereon.
SECTION 514. Waiver of Stay or Extension Laws.
The Company, the Subsidiary Guarantors and any other obligors
upon the Securities, covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which would prohibit or forgive the
Company, any Subsidiary Guarantor or any such obligor from paying all or any
portion of the principal of, premium, if any, or interest on the Securities
contemplated herein or in the Securities or which may affect the covenants or
the performance of this Indenture; and each of the Company, any Subsidiary
Guarantor and any such obligor (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.
SECTION 515. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any
Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in principal amount of the
Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of (or premium, if any) or interest
on any Security on or after the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on or after the Redemption Date).
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ARTICLE SIX.
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
(a) Except during the continuance of a Default or an Event of
Default,
(i) the Trustee undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture, and
the Trustee should not be liable except for the performance of such
duties as specifically set forth in the Indenture and no others; and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith or willful
misconduct on its part, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such certificates or opinions specifically required hereunder to be
furnished to the Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they substantially conform to the
requirements of this Indenture, but not to verify the contents thereof.
(b) In case a Default or an Event of Default has occurred and
is continuing of which a Trust Officer of the Trustee has actual knowledge or of
which written notice of such Default or Event of Default shall have been given
to the Trustee by the Company, any other obligor of the Securities or by any
Holder, 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 their exercise, as
a prudent man would exercise or use under the circumstances in the conduct of
his own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that
(i) this paragraph (c) shall not be construed to
limit the effect of paragraph (a) of this Section;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a majority in aggregate
principal amount of the Outstanding Securities relating to the time,
method and place of conducting any proceeding for any remedy available
to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Indenture.
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(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section and to the TIA.
SECTION 602. Notice of Defaults.
Within 90 days after the occurrence of any Default hereunder,
the Trustee shall transmit in the manner and to the extent provided in TIA
Section 313(c), notice of such Default hereunder actually known to a Trust
Officer of the Trustee, unless such Default shall have been cured or waived;
provided, however, that, except in the case of a Default in the payment of the
principal of (or premium, if any) or interest on any Security, the Trustee shall
be protected in withholding such notice if and so long as a trust committee of
directors and/or Trust Officers of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders; and provided
further that in the case of any Default of the character specified in Section
501(iii) no such notice to Holders shall be given until at least 30 days after
the occurrence thereof. Notwithstanding anything to the contrary expressed in
this Indenture, the Trustee shall not be deemed to have knowledge of any Default
or Event of Default hereunder unless and until a Trust Officer of the Trustee
shall have received written notice thereof from the Company at its principal
Corporate Trust Office as specified in Section 105, except in the case of an
Event of Default under Sections 501(i) or 501(ii) (provided that the Trustee is
the Paying Agent).
SECTION 603. Certain Rights of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Subject to the provisions of TIA Sections 315(a) through
315(d):
(i) the Trustee may conclusively rely and shall be
protected in acting or refraining from acting upon (whether in its
original or facsimile form) any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties and the Trustee need not
investigate any fact or matter stated in the documents;
(ii) any request or direction of the Company
mentioned herein shall be sufficiently evidenced by a Company Request
or Company Order and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
(iii) whenever in the administration of this
Indenture the Trustee shall deem it desirable that a matter be proved
or established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith or willful misconduct on
its part, request and rely upon an Officers' Certificate or an Opinion
of Counsel and shall not liable for any
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action it takes or omits to take in good faith reliance on such
Officers' Certificate or Opinion of Counsel;
(iv) the Trustee may consult with counsel of its
selection and any advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and
in reliance thereon;
(v) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Indenture at
the request or direction of any of the Holders pursuant to this
Indenture, unless such Holders shall have offered to the Trustee
security or indemnity reasonably satisfactory to the Trustee against
the costs, expenses, losses and liabilities which might be incurred by
it in compliance with such request or direction;
(vi) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness 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 to
examine the books, records and premises of the Company, personally or
by agent or attorney at the expense of the Company as described in
Section 607 of this Indenture and shall incur no liability of any kind
by reason of such inquiry or investigation;
(vii) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder; and
(viii) the Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and reasonably believed
by it to be authorized or within the discretion or rights or powers
conferred upon it by this Indenture; provided, however, that the
Trustee's conduct does not constitute willful misconduct or negligence;
and
(ix) the rights, privileges, protections, immunities
and benefits given to the Trustee, including, without limitation, its
right to be indemnified, are extended to, and shall be enforceable by,
the Trustee in each of its capacities hereunder, and each agent,
custodian and other Person employed to act hereunder.
(c) The Trustee shall not be required 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.
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SECTION 604. Trustee Not Responsible for Recitals or Issuance
of Securities.
The recitals contained herein and in the Securities, except
for the Trustee's certificates of authentication, shall be taken as the
statements of the Company, and the Trustee assumes no responsibility for their
correctness and it shall not be responsible for the Company's use of the
proceeds from the Securities. The Trustee makes no representations as to the
validity or sufficiency of this Indenture or of the Securities, except that the
Trustee represents that it is duly authorized to execute and deliver this
Indenture, authenticate the Securities and perform its obligations hereunder and
that the statements made by it in a Statement of Eligibility on Form T-1
supplied to the Company are true and accurate, subject to the qualifications set
forth therein. The Trustee shall not be accountable for the use or application
by the Company of the proceeds of the Securities.
SECTION 605. May Hold Securities.
The Trustee, any Paying Agent, any Note Registrar, any
Authenticating Agent or any other agent of the Company or of the Trustee, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to TIA Sections 310(b) and 311, may otherwise deal with the Company
with the same rights it would have if it were not Trustee, Paying Agent, Note
Registrar, Authenticating Agent or such other agent.
SECTION 606. Money Held in Trust.
All moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust hereunder for the purposes for
which they were received, but need not be segregated from other funds except to
the extent required by law. The Trustee shall be under no liability for interest
on any money received by it hereunder except as otherwise agreed in writing with
the Company.
SECTION 607. Compensation and Reimbursement.
Each of the Subsidiary Guarantors and the Company, jointly and
severally, agrees:
(i) to pay to the Trustee from time to time such
compensation as shall be agreed to in writing between the Company and
the Trustee for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(ii) except as otherwise expressly provided herein,
to reimburse the Trustee upon its request for all expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents, consultants and counsel and costs and expenses of collection),
except any such expense, disbursement or advance as shall be determined
by a court of competent jurisdiction to have been caused by its own
negligence or willful misconduct; and
(iii) to indemnify each of the Trustee or any
predecessor Trustee (and their respective directors, officers,
stockholders, employees and agents) for, and to hold them harmless
against, any and all loss, damage, claim, liability or expense,
including
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taxes (other than taxes based on the income of the Trustee) incurred
without gross negligence or willful misconduct on their part, arising
out of or in connection with the acceptance or administration of this
trust, including the costs and expenses of defending themselves against
any claim or liability in connection with the exercise or performance
of any of the Trustee's powers or duties hereunder.
The obligations of the Company under this Section to
compensate the Trustee, to pay or reimburse the Trustee for expenses,
disbursements and advances and to indemnify and hold harmless the Trustee shall
constitute additional indebtedness hereunder and shall survive the satisfaction
and discharge of this Indenture. As security for the performance of such
obligations of the Company, the Trustee shall have a lien prior to the Holders
of the Securities upon all property and funds held or collected by the Trustee
as such, except funds held in trust for the payment of principal of (and
premium, if any) or interest on particular Securities.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 501(vii) or (viii), the
expenses (including the reasonable charges and expenses of its counsel) of and
the compensation for such services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the termination
of this Indenture.
SECTION 608. Corporate Trustee Required; Eligibility.
There shall be at all times a Trustee hereunder which shall be
eligible to act as Trustee under TIA Section 310(a)(1), and which shall have an
office in The City of New York and shall have a combined capital and surplus of
at least $50,000,000. If the Trustee does not have an office in The City of New
York, the Trustee may appoint an agent in The City of New York reasonably
acceptable to the Company to conduct any activities which the Trustee may be
required under this Indenture to conduct in The City of New York. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of Federal, state, territorial or District of Columbia
supervising or examining authority, then for the purposes of this Section 608,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 608, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article.
SECTION 609. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of this Section.
(b) The Trustee may resign at any time by giving written
notice thereof to the Company. Upon receiving such notice of resignation, the
Company shall promptly appoint a successor trustee by written instrument
executed by authority of the Board of Directors, a copy
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of which shall be delivered to the resigning Trustee and a copy to the successor
trustee. If an instrument of acceptance required by this Section shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition, at the expense of the Company,
any court of competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the
Holders of not less than a majority in principal amount of the Outstanding
Securities, delivered to the Trustee and to the Company. The Trustee so removed
may, at the expense of the Company, petition any court of competent jurisdiction
for the appointment of a successor Trustee if no successor Trustee is appointed
within 30 days of such removal.
(d) If at any time:
(i) the Trustee shall fail to comply with the
provisions of TIA Section 310(b) after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a Security
for at least six months, or
(ii) the Trustee shall cease to be eligible under
Section 608 and shall fail to resign after written request therefor by
the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or
(iii) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a custodian of the Trustee
or of its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company, by a Board Resolution, may remove the
Trustee, or (B) subject to TIA Section 315(e), any Holder who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Company, by a Board Resolution, shall promptly appoint a
successor Trustee. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment, become the successor Trustee and supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Security for at least
six months may, at the expense of the Company on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to the
Holders of Securities in the
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manner provided for in Section 106. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.
SECTION 610. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder. Notwithstanding the replacement of the
Trustee pursuant to this Section 610, the Company's obligations under Section
607 shall continue for the benefit of the retiring Trustee with regard to
expenses and liabilities incurred by it and compensation earned by it prior to
such replacement or otherwise under the Indenture. Upon request of any such
successor Trustee, the Company shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.
No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
SECTION 611. Merger, Conversion, Consolidation or Succession
to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto. In case any Securities shall have
been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Securities so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Securities. In case at that time any of the Securities shall not have been
authenticated, any successor Trustee may authenticate such Securities either in
the name of any predecessor hereunder or in the name of the successor Trustee.
In all such cases such certificates shall have the full force and effect which
this Indenture provides for the certificate of authentication of the Trustee
shall have; provided, however, that the right to adopt the certificate of
authentication of any predecessor Trustee or to authenticate Securities in the
name of any predecessor Trustee shall apply only to its successor or successors
by merger, conversion or consolidation.
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SECTION 612. Trustee's Application for Instructions from the
Company.
Any application by the Trustee for written instructions from
the Company may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. Subject to Section 610, the Trustee shall not be liable for any
action taken by, or omission of, the Trustee in accordance with a proposal
included in such application on or after the date specified in such application
(which date shall not be less than three Business Days after the date any
officer of the Company actually receives such application, unless any such
officer shall have consented in writing to any earlier date) unless prior to
taking any such action (or the effective date in the case of an omission), the
Trustee shall have received written instructions in response to such application
specifying the action to be taken or omitted.
ARTICLE SEVEN.
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses.
The Company will furnish or cause to be furnished to the
Trustee
(a) semiannually, not more than 10 days after each Regular
Record Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date; and
(b) at such other times as the Trustee may reasonably request
in writing, within 30 days after receipt by the Company of any such request, a
list of similar form and content to that in Subsection (a) hereof as of a date
not more than 15 days prior to the time such list is furnished;
provided, however, that if and so long as the Trustee shall be the Note
Registrar, no such list need be furnished.
SECTION 702. Disclosure of Names and Addresses of Holders.
Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that none of the Company or the Trustee
or any agent of either of them shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the Holders
in accordance with TIA Section 312, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under TIA Section
312(b).
SECTION 703. Reports by Trustee.
Within 60 days after May 15 of each year commencing with the
first May 15 after the first issuance of Securities, the Trustee shall transmit
to the Holders, in the manner and to the extent provided in TIA Section 313(c),
a brief report dated as of such May 15 if required by TIA Section 313(a).
Delivery of such reports, information and documents to the Trustee is for
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informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to conclusively rely exclusively on Officers' Certificates).
The Trustee also shall comply with TIA 313(b). A copy of each
report at the time of its mailing to Holders shall be filed by the Trustee with
the Commission and each stock exchange (if any) on which the Securities are
listed. The Company agrees to notify promptly the Trustee whenever the
Securities become listed on any stock exchange and of any delisting thereof.
SECTION 704. Notice of Defaults.
The Company is required to deliver to the Trustee, within 30
days after the occurrence thereof, written notice of any event which would
constitute certain Defaults, their status and what action the Company is taking
or proposes to take in respect thereof.
ARTICLE EIGHT.
MERGER AND CONSOLIDATION
SECTION 801. Company May Consolidate, Etc., Only on Certain
Terms.
The Company will not, in a single transaction or series of
related transactions, consolidate with or merge with or into, or convey,
transfer or lease all or substantially all its assets to any Person, unless:
(i) the resulting, surviving or transferee Person
(the "Successor Company") shall be a Person organized and existing
under the laws of the United States of America, any State thereof or
the District of Columbia and the Successor Company (if not the Company)
shall expressly assume, by supplemental indenture, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Company under the Securities and hereunder;
(ii) immediately after giving effect to such
transaction (and treating any Indebtedness that becomes an obligation
of the Successor Company or any Subsidiary of the Successor Company as
a result of such transaction as having been incurred by the Successor
Company or such Restricted Subsidiary at the time of such transaction),
no Default or Event of Default shall have occurred and be continuing;
(iii) immediately before and after giving effect to
such transaction, the Company or the Successor Company, if the Company
is not the continuing obligor under this Indenture, shall at the time
of such transaction or series of transactions, after giving pro forma
effect to such transaction as if such transaction or series of
transaction had occurred on the first day of the four quarter period
ending on or immediately prior to the
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date of such transaction, be able to Incur at least $1.00 of
Indebtedness pursuant to clause (a) of Section 1010; and
(iv) the Company shall have delivered to the Trustee
(A) an Officers' Certificate, stating that (1) such Officers are not
aware of any Default or Event of Default that shall have happened and
be continuing and (2) such consolidation, merger or transfer and such
supplemental indenture comply with this Indenture; provided that no
Officers' Certificate will be required as to matters described in
clause (A)(1) of this clause (iv) for a consolidation, merger or
transfer described in the last paragraph of this Section 801, and (B)
an Opinion of Counsel, stating that such consolidation, merger or
transfer and such supplemental indenture comply with this Indenture,
both in the form required by this Indenture; provided that (1) in
giving such opinion such counsel may rely on such Officers' Certificate
as to any matters of fact (including without limitation as to
compliance with the foregoing clauses (ii) and (iii)), and (2) no
Opinion of Counsel will be required for a consolidation, merger or
transfer described in the last paragraph of this Section 801.
Notwithstanding the foregoing clauses (ii) and (iii), (x) any
Restricted Subsidiary may consolidate with, merge into or transfer all or part
of its properties and assets to the Company and (y) the Company may merge with
an Affiliate incorporated solely for the purpose of reincorporating the Company
in another jurisdiction to realize tax or other benefits.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company with or merger of the
Company with or into any other corporation or any conveyance, transfer, lease or
other disposition of all or substantially all of the assets of the Company to
any Person in accordance with Section 801, the Successor Company will succeed
to, and be substituted for, and may exercise every right and power of, the
Company hereunder and thereafter the predecessor Company shall be released from
all obligations and covenants hereunder, but, in the case of conveyance,
transfer or lease of all or substantially all its assets, the predecessor
Company will not be released from the obligation to pay the principal of and
interest on the Securities.
ARTICLE NINE.
SUPPLEMENTS AND AMENDMENTS TO INDENTURE
SECTION 901. Supplemental Indentures Without Consent of
Holders.
Without the consent of any Holders, the Company, the
Subsidiary Guarantors, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form satisfactory to
the Trustee, for any of the following purposes:
(i) to cure any ambiguity, omission, defect or
inconsistency; or
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(ii) to provide for uncertificated Securities in
addition to or in place of certificated Securities (provided that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code, or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code); or
(iii) to add Guarantees with respect to the
Securities (including those of Subsidiary Guarantors); or
(iv) to provide for the assumption by a successor
corporation, partnership, trust or limited liability company of the
obligations of the Company hereunder; or
(v) to secure the Securities; or
(vi) to confirm and evidence the release and
discharge of any Guarantee of the Securities or Lien with respect to or
securing the Securities when such release and discharge is permitted by
and provided for hereunder; or
(vii) to provide that any Indebtedness that becomes
or will become an obligation of the Successor Company pursuant to a
transaction governed by Section 801 (and that is not a Subordinated
Obligation) is Senior Subordinated Indebtedness for purposes of this
Indenture; or
(viii) to add to the covenants of the Company for the
benefit of the Holders or to surrender any right or power conferred
upon the Company; or
(ix) to make any other change that does not adversely
affect the rights of any Holder; or
(x) to comply with any requirement of the Commission
in connection with the qualification of this Indenture under the Trust
Indenture Act.
However, no amendment may be made to the subordination
provisions of this Indenture that adversely affects the rights of any holder of
Senior Indebtedness then outstanding unless the holders of such Senior
Indebtedness (or any group or representative thereof authorized to give a
consent) consent to such change.
SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of at least a majority in
principal amount of the Outstanding Securities (including consents obtained in
connection with a tender offer or exchange offer for the Securities), the
Company, the Subsidiary Guarantors, and the Trustee may enter into an indenture
or indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the Holders under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby (with
respect to any Securities held by a nonconsenting Holder of the Securities):
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(i) reduce the principal amount of Securities whose
Holders must consent to an amendment; or
(ii) reduce the stated rate of or extend the stated
time for payment of interest on any Security; or
(iii) reduce the principal of or extend the Stated
Maturity of any Security; or
(iv) reduce the premium payable upon the redemption
or repurchase of any Security or change the time at which any Security
may be redeemed as described in Section 1101; or
(v) make any Security payable in money other than
that stated in the Security; or
(vi) impair the right of any Holder to receive
payment of principal of and interest on such Holder's Securities on or
after the due dates therefor or to institute suit for the enforcement
of any payment on or with respect to such Holder's Securities; or
(vii) make any change in the amendment provisions
which require each Holder's consent or in the waiver provisions; or
(viii) make any change to the subordination
provisions of this Indenture that adversely affects the rights of any
Holder.
The consent of the Holders is not necessary under this
Indenture to approve the particular form of any proposed supplemental indenture.
It is sufficient if such consent approves the substance of the proposed
supplemental indenture.
SECTION 903. Execution of Supplemental Indentures.
The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities, as determined by the Trustee in its sole discretion under this
Indenture or otherwise. In signing or refusing to sign any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be provided with, and shall be
fully protected in relying upon, an Officers' Certificate and an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby (except as provided in Section 902).
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SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to the Article
shall conform to the requirements of the Trust Indenture Act as then in effect.
SECTION 906. Reference in Securities to Supplemental
Indentures.
Securities authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company or the Trustee shall
so determine, new Securities so modified as to conform to any such supplemental
indenture may be prepared and executed by the Company, and the Subsidiary
Guarantors and the Company shall issue and the Trustee shall authenticate a new
Security that reflects the changed terms, the cost and expense of which will be
borne by the Company in exchange for Outstanding Securities.
SECTION 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company, the Subsidiary
Guarantors and the Trustee of any supplemental indenture pursuant to the
provisions of Section 902, the Company shall give notice thereof to the Holders
of each Outstanding Security affected, in the manner provided for in Section
106, setting forth in general terms the substance of such supplemental
indenture. The failure to give such notice to all the Holders, or any defect
therein, will not impair or affect the validity of the supplemental indenture.
SECTION 908. Effect on Senior Indebtedness.
No supplemental indenture shall adversely affect the rights of
any holders of Senior Indebtedness under Article Thirteen unless the requisite
holders of each issue of Senior Indebtedness affected thereby shall have
consented to such supplemental indenture.
ARTICLE TEN.
COVENANTS
SECTION 1001. Payment of Principal, Premium, if any, and
Interest.
The Company covenants and agrees for the benefit of the
Holders that it will duly and punctually pay the principal of (and premium, if
any) and interest on the Securities in accordance with the terms of the
Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in The City of New York, an office
or agency where the Securities may be presented or surrendered for payment,
where, if applicable, the Securities may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The Corporate
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Trust Office of the Trustee shall be such office or agency of the Company,
unless the Company shall designate and maintain some other office or agency for
one or more of such purposes. The Company will give prompt written notice to the
Trustee of any change in the location of any such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies (in or outside of The City of New York) where the
Securities may be presented or surrendered for any or all such purposes and may
from time to time rescind any such designation; 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 City of New York for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and any change in the location of any such other
office or agency.
SECTION 1003. Money for Security Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent,
it will, on or before each due date of the principal of (or premium, if any) or
interest on any of the Securities, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the principal of (or
premium, if any) or interest so becoming due until such sums shall be paid to
such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure to so act.
Whenever the Company shall have one or more Paying Agents for
the Securities, it will, on or before each due date of the principal of (or
premium, if any) or interest on any Securities, deposit with a Paying Agent a
sum in same day funds (or New York Clearing House funds if such deposit is made
prior to the date on which such deposit is required to be made) that shall be
available to the Trustee by 11:00 a.m. Eastern Standard Time on such due date
sufficient to pay the principal (and premium, if any) or interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to
such principal, premium or interest, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of such action or any
failure to so act.
The Company will cause each Paying Agent (other than the
Trustee) to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee, subject to the provisions of this
Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of the
principal of (and premium, if any) or interest on Securities in trust
for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided;
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(ii) give the Trustee notice of any default by the
Company (or any other obligor upon the Securities) in the making of any
payment of principal (and premium, if any) or interest; and
(iii) at any time during the continuance of any such
default, upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such sums.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of (or
premium, if any) or interest on any Security and remaining unclaimed for two
years after such principal, premium or interest has become due and payable shall
be paid to the Company on Company Request, or (if then held by the Company)
shall be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment to the Company,
may at the expense of the Company cause to be published once, in a leading daily
newspaper (if practicable, The Wall Street Journal (Eastern Edition)) printed in
the English language and of general circulation in New York City, notice that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.
SECTION 1004. Corporate Existence.
Subject to Article Eight, the Company will do or cause to be
done all things necessary to preserve and keep in full force and effect the
corporate existence and that of each Restricted Subsidiary and the corporate
rights (charter and statutory) licenses and franchises of the Company and each
Restricted Subsidiary; provided, however, that the Company shall not be required
to preserve any such existence (except the Company) right, license or franchise
if the Board of Directors of the Company shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
each of its Restricted Subsidiaries, taken as a whole, and that the loss thereof
is not, and will not be, disadvantageous in any material respect to the Holders.
SECTION 1005. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (i) all material taxes,
assessments and governmental charges levied or imposed upon the Company or any
Subsidiary or upon the income, profits or property
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of the Company or any Subsidiary and (ii) all lawful claims for labor, materials
and supplies, which, if unpaid, might by law become a material liability or lien
upon the property of the Company or any Restricted Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings and for which appropriate reserves, if necessary (in the good faith
judgment of management of the Company) are being maintained in accordance with
GAAP.
SECTION 1006. Maintenance of Properties.
The Company will cause all material properties owned by the
Company or any Restricted Subsidiary or used or held for use in the conduct of
its business or the business of any Restricted Subsidiary to be maintained and
kept in normal condition, repair and working order and will cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of the Company may be necessary so that the business
carried on in connection therewith may be properly conducted at all times;
provided, however, that nothing in this Section shall prevent the Company or any
of its Restricted Subsidiaries from discontinuing the maintenance of any of such
properties if such discontinuance is, in the judgment of the Company, desirable
in the conduct of its business or the business of any Restricted Subsidiary and
not adverse in any material respect to the Holders.
SECTION 1007. Insurance.
To the extent available at commercially reasonable rates, the
Company will maintain, and will cause its Restricted Subsidiaries to maintain,
insurance with responsible carriers against such risks and in such amounts, and
with such deductibles, retentions, self-insured amounts and co-insurance
provisions, as are customarily carried by similar businesses, of similar size in
their country of organization, including professional and general liability,
property and casualty loss, workers' compensation and interruption of business
insurance. In the event the Company determines that insurance satisfying the
first sentence of this Section 1007 is not available at commercially available
rates, it shall provide an Officers' Certificate to such effect to the Trustee
and the Trustee may conclusively rely on the determinations set forth therein.
SECTION 1008. Compliance with Laws.
The Company shall comply, and shall cause each of its
Restricted Subsidiaries to comply, with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all states
and municipalities thereof, and of any governmental regulatory authority, in
respect of the conduct of their respective businesses and the ownership of their
respective properties, except for such noncompliances as would not in the
aggregate have a material adverse effect on the financial condition or results
of operations of the Company and its Restricted Subsidiaries, taken as a whole.
SECTION 1009. Limitation on Restricted Payments.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary, directly or indirectly, to (i) declare or pay any dividend or make
any distribution on or with respect to its Capital Stock (including any payment
to its stockholders in connection with any
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merger or consolidation involving the Company) except (A) dividends or
distributions payable solely in its Capital Stock (other than Disqualified
Stock) and (B) dividends or distributions payable to the Company or any
Restricted Subsidiary (and, if such Restricted Subsidiary is not a Wholly Owned
Subsidiary, to its other shareholders on no more than a pro rata basis, measured
by value), (ii) purchase, redeem, retire or otherwise acquire for value any
Capital Stock of the Company or any Restricted Subsidiary held by Persons other
than the Company or another Restricted Subsidiary, (iii) purchase, repurchase,
redeem, defease or otherwise acquire or retire for value, prior to scheduled
maturity, scheduled repayment or scheduled sinking fund payment, any
Subordinated Obligations (other than the purchase, repurchase, redemption or
other acquisition of Subordinated Obligations 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) or (iv) make any Investment
(other than a Permitted Investment) in any Person (any such dividend,
distribution, purchase, redemption, repurchase, defeasance, other acquisition,
retirement or Investment being herein referred to as a "Restricted Payment") if
at the time the Company or such Restricted Subsidiary makes such Restricted
Payment: (A) a Default shall have occurred and be continuing (or would result
therefrom); (B) the Company could not incur at least an additional $1.00 of
Indebtedness under paragraph (a) of the covenant contained in Section 1010; or
(C) the aggregate amount of such Restricted Payment and all other Restricted
Payments (the amount so expended, if other than in cash, to be determined in
good faith by the Company's Board of Directors, whose determination shall be
conclusive and evidenced by a resolution of the Company's Board of Directors)
declared or made subsequent to the date of this Indenture would exceed the sum
of: (1) 50% of the Consolidated Net Income accrued during the period (treated as
one accounting period) from the end of the most recent fiscal quarter ending
prior to the date of the Existing Indenture to the end of the most recent fiscal
quarter ending prior to the date of such Restricted Payment for which
consolidated financial statements of the Company are available (or, in case such
Consolidated Net Income shall be a deficit, minus 100% of such deficit); (2) the
aggregate Net Cash Proceeds received by the Company from the issuance or sale of
its Capital Stock (other than Disqualified Stock) subsequent to the date of the
Existing Indenture (other than an issuance or sale to a Restricted Subsidiary of
the Company); provided that in the event such issuance or sale is to an employee
stock ownership plan or other trust established by the Company or any of its
Subsidiaries for the benefit of their employees, to the extent the purchase by
such plan or trust is financed by Indebtedness of such plan or trust and for
which the Company is liable as a guarantor or otherwise, such aggregate amount
of Net Cash Proceeds shall be limited to the aggregate amount of principal
payments made by such plan or trust with respect to such Indebtedness); and (3)
in the case of the disposition or repayment of any Investment constituting a
Restricted Payment (without duplication of any amount deducted in calculating
the amount of Investments at any time outstanding included in the amount of
Restricted Payments), an amount equal to the lesser of (x) the return of capital
or similar repayment with respect to such Investment and (y) the initial amount
of such Investment, in either case, less the cost of the disposition of such
Investment.
(b) The provisions of the foregoing paragraph (a) will not
prohibit: (i) any purchase, redemption, repurchase, defeasance, retirement or
other acquisition of Capital Stock of the Company or Subordinated Obligations
made by exchange (including any such exchange pursuant to the exercise of a
conversion right or privilege in connection with which cash is paid in lieu of
the issuance of fractional shares) for, or out of the proceeds of the
substantially concurrent sale of, Capital Stock of the Company (other than
Disqualified Stock and other than
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Capital Stock issued or sold to a Subsidiary or an employee stock ownership plan
or other trust established by the Company or any of its Subsidiaries); provided,
however, that (A) such purchase, redemption, repurchase, defeasance, retirement
or other acquisition shall be excluded in subsequent calculations of the amount
of Restricted Payments and (B) the Net Cash Proceeds or reduction of
Indebtedness from such sale shall be excluded in calculations under clauses (B)
and (C) of the previous paragraph; (ii) any purchase, redemption, repurchase,
defeasance, retirement or other acquisition of Subordinated Obligations made by
exchange for, or out of the proceeds of the substantially concurrent sale of,
Subordinated Obligations of the Company that is permitted to be Incurred
pursuant to the covenant contained in Section 1010; provided, however, that such
purchase, redemption, repurchase, defeasance, retirement or other acquisition
shall be excluded in subsequent calculations of the amount of Restricted
Payments; (iii) any purchase, redemption, repurchase, defeasance, retirement or
other acquisition of Subordinated Obligations from Net Available Cash to the
extent permitted by the covenant contained in Section 1017; provided, however,
that such purchase, redemption, repurchase, defeasance, retirement or other
acquisition shall be excluded in subsequent calculations of the amount of
Restricted Payments; (iv) dividends paid within 60 days after the date of
declaration thereof if at such date of declaration such dividend would have
complied with paragraph (a); provided, however, that such dividend shall be
included in subsequent calculations of the amount of Restricted Payments; (v)
any purchase or redemption of any shares of Capital Stock of the Company from
employees of the Company and its Subsidiaries pursuant to the repurchase
provisions under employee stock option or stock purchase agreements or other
agreements to compensate management employees in an aggregate amount after the
date of the Existing Indenture not in excess of $2.5 million in any fiscal year,
plus any unused amounts under this clause (v) from prior fiscal years; provided,
however, that such purchases or redemptions shall be excluded in subsequent
calculations of the amount of Restricted Payments; or (vi) the repurchase of the
Company's common stock in an aggregate amount not to exceed the amount by which
the proceeds from the issuance of the Convertible Preferred Stock exceeds $235
million; provided, however, the aggregate amount of repurchases pursuant to this
clause (vi) shall not exceed $25 million from the date of the Existing
Indenture.
(c) Not later than the date of making any Restricted Payment,
the Company shall deliver to the Trustee an Officers' Certificate stating that
such Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 1009 were computed, which calculations may
be based upon the Company's latest available financial statements. The Trustee
shall have no duty to recompute or recalculate or verify the accuracy of the
information set forth in such Officers' Certificate.
(d) The Company will not permit any Unrestricted Subsidiary to
become a Restricted Subsidiary except pursuant to the second to last sentence of
the definition of "Unrestricted Subsidiary."
SECTION 1010. Limitation on Indebtedness.
(a) The Company shall not, and shall not permit any Restricted
Subsidiary to, Incur any Indebtedness; provided, however, that the Company and
any Restricted Subsidiary which is a Subsidiary Guarantor may Incur Indebtedness
if, on the date of the Incurrence of such Indebtedness the Consolidated Coverage
Ratio would be greater than 2.50 to 1.00.
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(b) Notwithstanding the foregoing paragraph (a), the Company
and its Restricted Subsidiaries may Incur the following Indebtedness: (i)
Indebtedness Incurred pursuant to the Senior Credit Facility (or any refinancing
thereof) in a maximum principal amount not to exceed $962.25 million; (ii) the
Subsidiary Guarantees and Guarantees of Indebtedness incurred pursuant to
paragraph (a) or clause (i) of this paragraph (b), or any refinancing thereof,
in a principal amount not to exceed $962.25 million; (iii) Indebtedness (A) of
the Company to any Restricted Subsidiary and (B) of any Wholly Owned Subsidiary
to the Company or any Restricted Subsidiary; provided, however, that any
subsequent issuance or transfer of any Capital Stock or any other event that
results in any such Wholly Owned Subsidiary ceasing to be a Wholly Owned
Subsidiary or any other subsequent transfer of any such Indebtedness (except to
the Company or a Wholly Owned Subsidiary) will be deemed, in each case, an
Incurrence of Indebtedness by the Company or such Restricted Subsidiary, as the
case may be, in the amount that remains outstanding following such issuance or
transfer of such securities; (iv) Indebtedness represented by the Securities,
any Indebtedness (other than the Indebtedness described in clauses (i), (ii) or
(iii) above) outstanding on the date of this Indenture and any Refinancing
Indebtedness Incurred in respect of any Indebtedness described in this clause
(iv) or the previous paragraph; (v) Indebtedness of the Company or any
Restricted Subsidiary in the form of Capitalized Lease Obligations, Purchase
Money Obligations or Attributable Debt, and any Refinancing Indebtedness with
respect thereto, in an aggregate amount not in excess of 2.5% of Consolidated
Tangible Assets at any one time outstanding; (vi) Indebtedness under Hedging
Obligations; provided, however, that such Hedging Obligations are entered into
for bona fide hedging purposes of the Company or any Restricted Subsidiary and
are in the ordinary course of business or are required by the Senior Credit
Facility; (vii) Indebtedness evidenced by letters of credit assumed in the
Transactions or issued in the ordinary course of business of the Company to
secure workers' compensation and other insurance coverages; (viii) Guarantees of
the Company in respect of Indebtedness of franchisees not to exceed $50 million
at any one time outstanding; and (ix) Indebtedness (which may comprise Bank
Indebtedness) in an aggregate principal amount at any one time outstanding not
in excess of $25.0 million.
(c) Notwithstanding the foregoing, neither the Company nor any
Restricted Subsidiary shall Incur any Indebtedness pursuant to the foregoing
paragraph that permits Refinancing Indebtedness in respect of Indebtedness
constituting Subordinated Obligations if the proceeds of such Refinancing
Indebtedness are used, directly or indirectly, to Refinance such Subordinated
Obligations, unless such Refinancing Indebtedness will be subordinated to the
Securities at least to the same extent as such Subordinated Obligations. No
Subsidiary Guarantor will Incur any Indebtedness pursuant to the foregoing
paragraph that permits Refinancing Indebtedness in respect of Indebtedness
constituting Guarantor Subordinated Obligations if the proceeds of such
Refinancing Indebtedness are used, directly or indirectly, to Refinance such
Guarantor Subordinated Obligations of such Subsidiary Guarantor unless such
Refinancing Indebtedness will be subordinated to the obligations of such
Subsidiary Guarantor under its Subsidiary Guarantee to at least the same extent
as such Guarantor Subordinated Obligations.
(d) For purposes of determining compliance with, and the
outstanding principal amount of any particular Indebtedness Incurred pursuant to
and in compliance with, this covenant, (i) in the event that Indebtedness meets
the criteria of more than one of the types of Indebtedness described in
paragraph (b) of this Section, the Company, in its sole discretion, shall
classify such item of Indebtedness and only be required to include the amount
and type of
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such Indebtedness in one of such clauses; and (ii) the amount of Indebtedness
issued at a price that is less than the principal amount thereof shall be equal
to the amount of the liability in respect thereof determined in accordance with
GAAP.
(e) The Company will not permit any Unrestricted Subsidiary to
Incur any Indebtedness other than Non-Recourse Debt; provided, however, if any
such Indebtedness ceases to be Non-Recourse Debt, such event shall be deemed to
constitute an incurrence of Indebtedness by the Company or a Restricted
Subsidiary.
SECTION 1011. Limitation on Layering.
The Company shall not incur any Indebtedness that is expressly
subordinate in right of payment to any Senior Indebtedness unless such
Indebtedness is Senior Subordinated Indebtedness or is contractually
subordinated in right of payment to Senior Subordinated Indebtedness. No
Subsidiary Guarantor will incur any Indebtedness that is expressly subordinate
in right of payment to any Guarantor Senior Indebtedness of such Subsidiary
Guarantor unless such Indebtedness is Guarantor Senior Subordinated Indebtedness
of such Subsidiary Guarantor or is contractually subordinated in right of
payment to Guarantor Senior Subordinated Indebtedness of such Subsidiary
Guarantor. Unsecured Indebtedness is not deemed to be subordinate or junior to
Secured Indebtedness merely because it is unsecured, and Indebtedness that is
not guaranteed by a particular Person is not deemed to be subordinate or junior
to Indebtedness that is so guaranteed merely because it is not so guaranteed.
SECTION 1012. Limitation on Affiliate Transactions.
(a) The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, enter into or conduct any transaction or
series of transactions (including the purchase, sale, lease or exchange of any
property or the rendering of any service with any Affiliate of the Company (an
"Affiliate Transaction") on terms (i) that taken as a whole are less favorable
to the Company or such Restricted Subsidiary, as the case may be, than those
that could be obtained at the time of such transaction in arm's-length dealings
with a Person who is not such an Affiliate and (ii) that, in the event such
Affiliate Transaction involves an aggregate amount in excess of $10.0 million,
are not in writing and have not been approved by a majority of the members of
the Board of Directors having no material personal financial interest in such
Affiliate Transaction or, in the event there are no such members, as to which
the Company has not obtained a Fairness Opinion (as hereinafter defined). In
addition, any transaction involving aggregate payments or other transfers by the
Company and its Restricted Subsidiaries in excess of $20.0 million will also
require an opinion (a "Fairness Opinion") from an independent investment banking
firm or appraiser, as appropriate, of national prominence, to the effect that
the terms of such transaction are fair to the Company or such Restricted
Subsidiary, as the case may be, from a financial point of view.
(b) The provisions of the foregoing paragraph (a) shall not
prohibit (i) any Restricted Payment permitted by Section 1009, or any Permitted
Investment, (ii) the performance of the Company's or Restricted Subsidiary's
obligations under any employment contract, collective bargaining agreement,
agreement for the provision of services, employee benefit plan, related trust
agreement or any other similar arrangement heretofore or hereafter entered into
in
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the ordinary course of business, (iii) payment of compensation, performance of
indemnification or contribution obligations, or any issuance, grant or award of
stock, options or other securities, to employees, officers or directors in the
ordinary course of business, (iv) any transaction between the Company and a
Restricted Subsidiary or between Restricted Subsidiaries, (v) the Transactions
and the incurrence and payment of all fees and expenses payable in connection
therewith as described in or contemplated by the offering memorandum relating to
the Existing Notes, (vi) any other transaction arising out of agreements in
existence on the date of the Existing Indenture and (vii) transactions with
suppliers or other purchasers or sellers of goods or services, in each case in
the ordinary course of business and on terms no less favorable to the Company or
the Restricted Subsidiary, as the case may be, than those that could be obtained
at such time in arm's-length dealings with a Person which is not an Affiliate.
SECTION 1013. Limitation on Restrictions on Distributions from
Restricted Subsidiaries.
The Company will not, and will not permit any Restricted
Subsidiary to, create or otherwise cause or permit to exist or become effective
any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to (i) pay dividends or make any other distributions on its Capital
Stock or pay any Indebtedness or other obligations owed to the Company, (ii)
make any loans or advances to the Company or (iii) transfer any of its property
or assets to the Company, except (A) any encumbrance or restriction pursuant to
an agreement in effect at or entered into on the date of the Existing Indenture
(including, without limitation, the Senior Credit Facility); (B) any encumbrance
or restriction with respect to a Restricted Subsidiary (1) pursuant to an
agreement relating to any Indebtedness Incurred by a Restricted Subsidiary prior
to the date on which such Restricted Subsidiary was acquired by the Company, or
of another Person that is assumed by the Company or a Restricted Subsidiary in
connection with the acquisition of assets from, or merger or consolidation with,
such Person (other than Indebtedness Incurred as consideration in, or to provide
all or any portion of the funds or credit support utilized to consummate, the
transaction or series of related transactions pursuant to which such Restricted
Subsidiary became a Restricted Subsidiary or was acquired by the Company, or
such acquisition of assets, merger or consolidation) and outstanding on the date
of such acquisition, merger or consolidation or (2) pursuant to any agreement
(not relating to any Indebtedness) in existence when a Person becomes a
Subsidiary of the Company or when such agreement is acquired by the Company or
any Subsidiary thereof, that is not created in contemplation of such Person
becoming such a Subsidiary or such acquisition (for purposes of this clause (B),
if another Person is the Successor Company, any Subsidiary or agreement thereof
shall be deemed acquired or assumed, as the case may be, by the Company when
such Person becomes the Successor Company); (C) any encumbrance or restriction
with respect to a Restricted Subsidiary pursuant to an agreement (a "Refinancing
Agreement") effecting a refinancing of Indebtedness Incurred pursuant to, or
that otherwise extends, renews, refinances or replaces, an agreement referred to
in clause (A) or (B) of this covenant or this clause (C) or contained in any
amendment to an agreement referred to in clause (A) or (B) of this covenant or
this clause (C) (an "Initial Agreement") or contained in any amendment to an
Initial Agreement; provided, however, that the encumbrances and restrictions
contained in any such Refinancing Agreement or amendment are no less favorable
to the Holders of the Securities taken as a whole than encumbrances and
restrictions contained in the Initial Agreement or Agreements to which such
Refinancing Agreement or amendment relates; (D) any encumbrance or restriction
(1) that restricts in a
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customary manner the subletting, assignment or transfer of any property or asset
that is subject to a lease, license or similar contract, or the assignment or
transfer of any lease, license or other contract, (2) by virtue of any transfer
of, agreement to transfer, option or right with respect to, or Lien on, any
property or assets of the Company or any Restricted Subsidiary not otherwise
prohibited by this Indenture, (3) contained in mortgages, pledges or other
agreements securing Indebtedness of a Restricted Subsidiary to the extent such
encumbrance or restrictions restrict the transfer of the property subject to
such mortgages, pledges or other security agreements or (4) pursuant to
customary provisions restricting dispositions of real property interests set
forth in any reciprocal easement agreements of the Company or any Restricted
Subsidiary; (E) any restriction with respect to a Restricted Subsidiary (or any
of its property or assets) imposed pursuant to an agreement entered into for the
direct or indirect sale or disposition of all or substantially all the Capital
Stock or assets of such Restricted Subsidiary (or the property or assets that
are subject to such restriction) pending the closing of such sale or
disposition; and (F) any encumbrance or restriction on the transfer of property
or assets required by any regulatory authority having jurisdiction over the
Company or any Restricted Subsidiary or any of their businesses.
SECTION 1014. Limitation on Sale or Issuance of Preferred
Stock of Restricted Subsidiaries.
The Company shall not sell any shares of Preferred Stock of a
Restricted Subsidiary, and shall not permit any Restricted Subsidiary, directly
or indirectly, to issue or sell any shares of its Preferred Stock to any Person
(other than to the Company or a Restricted Subsidiary).
SECTION 1015. Limitation on Liens.
The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create or permit to exist any Lien (other
than Permitted Liens) on any of its property or assets (including Capital
Stock), whether owned on the date of the Existing Indenture or thereafter
acquired, securing any Indebtedness that is not Senior Indebtedness (the
"Initial Lien"), unless contemporaneously therewith effective provision is made
to secure the obligations due under this Indenture and the Securities or, in
respect of Liens on any Restricted Subsidiary's property or assets, equally and
ratably with such obligation for so long as such obligation is secured by such
Initial Lien. Any such Lien thereby created in favor of the Securities will be
automatically and unconditionally released and discharged upon (i) the release
and discharge of the Initial Lien to which it relates, or (ii) any sale,
exchange or transfer to any Person not an Affiliate of the Company of the
property or assets secured by such Initial Lien, or of all of the Capital Stock
held by the Company or any Restricted Subsidiary in, or all or substantially all
the assets of, any Restricted Subsidiary creating such Lien.
SECTION 1016. Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder
will have the right to require the Company to repurchase all or any part of such
Holder's Securities at a purchase price in cash equal to 101% of the principal
amount thereof, plus accrued and unpaid interest, if any, to the date of
repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the relevant interest payment date) (the "Change
of Control
104
Offer"); provided, however, that notwithstanding the occurrence of a Change of
Control, the Company shall not be obligated to purchase the Securities pursuant
to this covenant in the event that it has exercised its right to redeem all of
the Securities pursuant to Section 1101.
(b) Within 30 days following any Change of Control (or at the
Company's option, prior to such Change of Control but after the public
announcement thereof), unless the Company has mailed a redemption notice in
connection with such Change of Control as described in Section 1105, the Company
shall mail a notice to each holder with a copy to the Trustee stating:
(i) that a Change of Control has occurred or will
occur and that such Holder has (or upon such occurrence will have) the
right to require the Company to purchase such Holder's Securities at a
purchase price in cash equal to 101% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the date of purchase
(subject to the right of Holders of record on a record date to receive
interest on the relevant interest payment date);
(ii) the circumstances and relevant facts and
financial information regarding such Change of Control;
(iii) (the date of purchase (which shall be no
earlier than 30 days nor later than 90 days from the date such notice
is mailed);
(iv) the instructions determined by the Company,
consistent with this covenant, that a Holder must follow in order to
have its Securities purchased; and
(v) that, if such offer is made prior to such Change
of Control, payment is conditioned on the occurrence of such Change of
Control.
(c) The Company will 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
this covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Indenture, the Company will comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations described in this Indenture by virtue thereof.
SECTION 1017. Limitation on Sales of Assets.
(a) The Company will not, and will not permit any Restricted
Subsidiary to, make any Asset Disposition unless the Company or such Restricted
Subsidiary receives consideration (including by way of relief from, or by any
other Person assuming sole responsibility for, any liabilities, contingent or
otherwise) at the time of such Asset Disposition at least equal to the fair
market value of the shares and assets subject to such Asset Disposition of such
fair market value shall be determined in good faith by the Board of Directors,
whose determination shall be conclusive (including as to the value of all
non-cash consideration), (ii) at least 75% of the consideration therefor
(excluding, in the case of an Asset Disposition of assets, any consideration by
way of relief from, or by any other person assuming responsibility for, any
liabilities, contingent or otherwise, which are not Indebtedness) received by
the Company or
105
such Restricted Subsidiary is in the form of cash and (iii) an amount equal to
100% of the Net Available Cash from such Asset Disposition is applied by the
Company (or such Restricted Subsidiary, as the case may be) (A) first, to the
extent the Company elects (or is required by the terms of any Senior
Indebtedness or Indebtedness (other than Preferred Stock) of a Restricted
Subsidiary), to prepay, repay or purchase Senior Indebtedness or such
Indebtedness of a Restricted Subsidiary (in each case other than Indebtedness
owed to the Company or a Restricted Subsidiary of the Company) within 365 days
after the date of such Asset Disposition; (B) second, to the extent of the
balance of Net Available Cash after application in accordance with clause (A),
to the extent the Company or such Restricted Subsidiary elects, to reinvest in
Additional Assets (including by means of an Investment in Additional Assets by a
Restricted Subsidiary with Net Available Cash received by the Company or another
Restricted Subsidiary) within 365 days from the date of such Asset Disposition
or, if such reinvestment in Additional Assets is a project authorized by the
Board of Directors that will take longer than 365 days to complete, the period
of time necessary to complete such project; (C) third, to the extent of the
balance of such Net Available Cash after application in accordance with clauses
(A) and (B) (such balance, the "Excess Proceeds"), to make an offer to purchase
Securities at a price in cash equal to 100% of the principal amount thereof,
plus accrued and unpaid interest, if any, to the purchase date, and (to the
extent required by the terms thereof) any other Senior Subordinated Indebtedness
pursuant and subject to the conditions of the agreements governing such other
Indebtedness at a purchase price of 100% of the principal amount thereof plus
accrued and unpaid interest to the purchase date and (D) fourth, to the extent
of the balance of such Excess Proceeds after application in accordance with
clauses (A), (B) and (C) above, to fund (to the extent consistent with any other
applicable provision of this Indenture) any general corporate purpose (including
the repayment of Subordinated Obligations); provided, however, that in
connection with any prepayment, repayment or purchase of Indebtedness pursuant
to clause (A) or (C) above, the Company or such Restricted Subsidiary will
retire such Indebtedness and will cause the related loan commitment (if any) to
be permanently reduced in an amount equal to the principal amount so prepaid,
repaid or purchased. Notwithstanding the foregoing provisions of this covenant,
the Company and the Restricted Subsidiaries shall not be required to apply any
Net Available Cash in accordance with this covenant except to the extent that
the aggregate Net Available Cash from all Asset Dispositions that is not applied
in accordance with this covenant exceeds $10.0 million.
To the extent that the aggregate principal amount of the
Securities and other Senior Subordinated Indebtedness tendered pursuant to an
offer to purchase made in accordance with clause (C) above exceeds the amount of
Excess Proceeds, the Trustee shall select the Securities and Senior Subordinated
Indebtedness to be purchased on a pro rata basis, based on the aggregate
principal amount thereof surrendered in such offer to purchase. Upon completion
of such offer to purchase, the amount of Excess Proceeds shall be reset to zero.
For the purposes of this covenant, the following are deemed to
be cash: (v) Cash Equivalents, (w) the assumption of Indebtedness of the Company
(other than Disqualified Stock of the Company) or any Restricted Subsidiary and
the release of the Company or such Restricted Subsidiary from all liability on
such Indebtedness in connection with such Asset Disposition, (x) Indebtedness of
any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result
of such Asset Disposition, to the extent that the Company and each other
Restricted Subsidiary is released from any Guarantee (or is the beneficiary of
any indemnity with respect thereto which is
106
secured by any letter of credit or cash equivalents) of such Indebtedness in
connection with such Asset Disposition, (y) securities received by the Company
or any Restricted Subsidiary from the transferee that are promptly converted by
the Company or such Restricted Subsidiary into cash, and (z) consideration
consisting of Indebtedness of the Company or any Restricted Subsidiary.
(b) The Company will 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
this covenant. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this covenant, the Company will comply
with the applicable securities laws and regulations and will not be deemed to
have breached its obligations under this covenant by virtue thereof.
SECTION 1018. Statement by Officers as to Default.
(a) The Company will deliver to the Trustee, within 120 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Restricted Subsidiaries during
the preceding fiscal year has been made under the supervision of the signing
officers with a view to determining whether it has kept, observed, performed and
fulfilled, and has caused each of its Restricted Subsidiaries to keep, observe,
perform and fulfill its obligations under this Indenture and further stating, as
to each such officer signing such certificate, that, to the best of his or her
knowledge, the Company during such preceding fiscal year has kept, observed,
performed and fulfilled, and has caused each of its Restricted Subsidiaries to
keep, observe, perform and fulfill, each and every such covenant contained in
this Indenture and no Default or Event of Default occurred during such year and
at the date of such certificate there is no Default or Event of Default which
has occurred and is continuing or, if such signers do know of such Default or
Event of Default, the certificate shall describe its status, with particularity
and that, to the best of his or her knowledge, no event has occurred and remains
by reason of which payments on the account of the principal of or interest, if
any, on the Securities is prohibited or if such event has occurred, a
description of the event and what action each is taking or proposes to take with
respect thereto. The Officers' Certificate shall also notify the Trustee should
the Company elect to change the manner in which it fixes its fiscal year end.
For purposes of this Section 1018(a), such compliance shall be determined
without regard to any period of grace or requirement of notice under this
Indenture.
(b) When any Default has occurred and is continuing under this
Indenture, or if the trustee for or the holder of any other evidence of
Indebtedness of the Company or any Significant Subsidiary gives any notice or
takes any other action with respect to a claimed default (other than with
respect to Indebtedness in the principal amount of less than $20 million), the
Company shall deliver to the Trustee by registered or certified mail or
facsimile transmission an Officers' Certificate specifying such event, notice or
other action within five Business Days of its occurrence.
SECTION 1019. Reporting Requirements.
As long as any of the Securities is outstanding, the Company
will file with the Commission (unless the Commission will not accept such a
filing) the annual reports, quarterly reports and other documents required to be
filed with the Commission pursuant to Sections 13
107
and 15 of the Exchange Act, whether or not the Company is then obligated to file
reports pursuant to such sections. The Company will be required to file with the
Trustee and provide to each holder of Securities within 15 days after filing
with the Commission (or if any such filing is not required under the Exchange
Act, 15 days after the Company would have been required to make such filing)
copies of such reports and documents.
SECTION 1020. Future Subsidiary Guarantors.
After the date of the Existing Indenture, the Company will
cause each Restricted Subsidiary created or acquired by the Company to execute
and deliver to the Trustee a Subsidiary Guarantee pursuant to which such
Restricted Subsidiary will unconditionally Guarantee, on a joint and several
basis, the full and prompt payment of the principal of, premium, if any, and
interest on the Securities on a senior unsecured basis. Such Guarantee shall be
in the form of a supplemental indenture to this Indenture in accordance with
Section 901.
SECTION 1021. Designation of Unrestricted Subsidiaries.
The Board of Directors of the Company may designate any
Restricted Subsidiary to be an Unrestricted Subsidiary if such designation would
not cause a default. For purposes of making such determination, all outstanding
Investments by the Company and its Restricted Subsidiaries (except to the extent
repaid in cash) in the Subsidiary so designated will be deemed to be Restricted
Payments at the time of such designation and will reduce the amount available
for Restricted Payments under clause (C) of paragraph (a) of Section 1009. All
such outstanding Investments will be deemed to constitute Investments in an
amount equal to the greater of the fair market value or the book value of such
Subsidiary at the time of such designation. Such designation will only be
permitted if such Restricted Payment would be permitted at such time and if such
Restricted Subsidiary otherwise meets the definition of an Unrestricted
Subsidiary.
SECTION 1022. Limitation on Sale/Leaseback Transactions.
The Company will not, and will not permit any Restricted
Subsidiary to, enter into any Sale/Leaseback Transaction with respect to any
property unless: (i) the Company or such Restricted Subsidiary would be entitled
to Incur Indebtedness in an amount equal to the Attributable Debt with respect
to such Sale/Leaseback Transaction pursuant to Section 1010; (ii) the net
proceeds received by the Company or any Restricted Subsidiary in connection with
such Sale/Leaseback Transaction are at least equal to the fair value (as
determined by the Board of Directors) of such property; and (iii) the transfer
of such property is permitted by, and the Company or such Restricted Subsidiary
applies the proceeds of such transaction in compliance with, the covenant
described under Section 1017.
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ARTICLE ELEVEN.
REDEMPTION OF SECURITIES
SECTION 1101. Optional Redemption.
The Securities will be redeemable at the Company's option, in
whole or in part, at any time and from time to time on and after August 15, 2003
and prior to maturity, upon not less than 30 nor more than 90 days' prior notice
mailed by first-class mail to each Holder's registered address, at the following
redemption prices (expressed as a percentage of principal amount), plus accrued
interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
interest payment date), if redeemed during the 12-month period commencing on
August 15 of the years set forth below:
REDEMPTION
PERIOD PRICE
-------------------------------------------------------- ----------
2003 ................................................... 105.500%
2004 ................................................... 103.667%
2005 ................................................... 101.833%
2006 and thereafter .................................... 100.000%
SECTION 1102. Applicability of Article.
Redemption of Securities at the election of the Company or
otherwise, as permitted or required by any provision of this Indenture, shall be
made in accordance with such provision and this Article.
SECTION 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities pursuant
to Section 1101 shall be evidenced by a Board Resolution. In case of any
redemption at the election of the Company, the Company shall, at least 90 days
prior to the Redemption Date fixed by the Company (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee in writing of such
Redemption Date, the specific provision of the Indenture pursuant to which such
redemption is being made, the Redemption Price and the principal amount of
Securities to be redeemed and shall deliver to the Trustee such documentation
and records as shall enable the Trustee to select the Securities to be redeemed
pursuant to Section 1104.
SECTION 1104. Selection by Trustee of Securities to Be
Redeemed.
If less than all the Securities are to be redeemed at any time
pursuant to an optional redemption, the particular Securities to be redeemed
shall be selected at least 30 but not more than 90 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities not previously called for
redemption, in compliance with the requirements of the principal securities
exchange, if any, on which such Securities are listed, or, if such Securities
are not so listed, on a pro rata basis, by lot or by such other method as the
Trustee shall deem fair and appropriate (and in such manner as complies with
applicable legal requirements) and which may provide for the selection for
redemption of portions of the principal of the Securities; provided, however,
that no Securities of a principal amount of $1,000 or less shall be redeemed in
part.
109
The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption of Securities shall
relate, in the case of any Security redeemed or to be redeemed only in part, to
the portion of the principal amount of such Security which has been or is to be
redeemed.
SECTION 1105. Notice of Redemption.
Notice of redemption shall be given in the manner provided for
in Section 106 not less than 30 nor more than 90 days prior to the Redemption
Date, to each Holder of Securities to be redeemed. The Trustee shall give notice
of redemption in the Company's name and at the Company's expense; provided,
however, that the Company shall deliver to the Trustee, at least 45 days prior
to the Redemption Date, an Officers' Certificate requesting that the Trustee
give such notice and setting forth the information to be stated in such notice
as provided in the following items.
All notices of redemption shall state:
(i) the Redemption Date,
(ii) the Redemption Price and the amount of accrued
interest to the Redemption Date payable as provided in Section 1107, if
any,
(iii) if less than all Outstanding 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,
(iv) in case any Security is to be redeemed in part
only, the notice which relates to such Security shall state that on and
after the Redemption Date, upon surrender of such Security, the holder
will receive, without charge, a new Security or Securities of
authorized denominations for the principal amount thereof remaining
unredeemed,
(v) that on the Redemption Date the Redemption Price
(and accrued interest, if any, to the Redemption Date payable as
provided in Section 1107) will become due and payable upon each such
Security, or the portion thereof, to be redeemed, and, unless the
Company defaults in making the redemption payment, that interest on
Securities called for redemption (or the portion thereof) will cease to
accrue on and after said date,
(vi) the place or places where such Securities are to
be surrendered for payment of the Redemption Price and accrued
interest, if any,
(vii) the name and address of the Paying Agent,
110
(viii) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price,
(ix) the CUSIP number, and that no representation is
made as to the accuracy or correctness of the CUSIP number, if any,
listed in such notice or printed on the Securities, and
(x) the paragraph of the Securities or Section of the
Indenture pursuant to which the Securities are to be redeemed.
SECTION 1106. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 1003) an amount
of money sufficient to pay the Redemption Price of, and accrued interest on, all
the Securities which are to be redeemed on that date.
SECTION 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified (together with accrued
interest, if any, to the Redemption Date), and from and after such date (unless
the Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price, together with accrued interest,
if any, to the Redemption Date; provided, however, that installments of interest
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Regular Record Date
or Special Record Date, as the case may be, according to their terms and the
provisions of Section 311.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear interest from the Redemption Date at the rate borne by
the Securities.
SECTION 1108. Securities Redeemed in Part.
Any Security which is to be redeemed only in part (pursuant to
the provisions of this Article) shall be surrendered at the office or agency of
the Company maintained for such purpose pursuant to Section 1002 (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or such Holder's attorney duly authorized in writing),
and the Company shall execute, and the Trustee shall authenticate and deliver to
the Holder of such Security at the expense of the Company, a new Security or
Securities, of any authorized denomination as requested by such Holder, in an
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered,
111
provided, that each such new Security will be in a principal amount of $1,000 or
integral multiple thereof.
ARTICLE TWELVE.
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1201. Company's Option to Effect Legal Defeasance or
Covenant Defeasance.
The Company may, at its option, at any time, with respect to
the Securities, elect to have either Section 1202 or Section 1203 be applied to
all Outstanding Securities upon compliance with the conditions set forth in this
Article Twelve.
SECTION 1202. Legal Defeasance and Discharge.
Upon the Company's exercise under Section 1201 of the option
applicable to this Section 1202, the Company and any Subsidiary Guarantor shall
be deemed to have been discharged from its obligations with respect to all
Outstanding Securities on the date the conditions set forth in Section 1204 are
satisfied (hereinafter, "Legal Defeasance"). For this purpose, such Legal
Defeasance means that the Company and any such Subsidiary Guarantor 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 Section 1205 and the other Sections of 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 Section 1204 and as more fully set forth in such Section, payments
in respect of the principal of (and premium, if any, on) and interest on such
Securities when such payments are due, (ii) the Company's obligations with
respect to such Securities under Sections 304, 305, 310, 1002 and 1003, (iii)
the rights, powers, trusts, duties and immunities of the Trustee hereunder, and
the Company's obligations in connection therewith and (iv) this Article Twelve.
If the Company exercises its Legal Defeasance Option, payment
of the Securities may not be accelerated because of an Event of Default.
Subject to compliance with this Article Twelve, the Company
may exercise its option under this Section 1202 notwithstanding the prior
exercise of its option under Section 1203 with respect to the Securities.
SECTION 1203. Covenant Defeasance.
Upon the Company's exercise under Section 1201 of the option
applicable to this Section 1203, the Company may terminate its obligations under
any covenant contained in
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Sections 1004 through 1022, the operation of Section 501(vi), Section 501(vii)
(with respect only to Significant Subsidiaries), Section 501(viii) (with respect
only to Significant Subsidiaries) and Section 501(ix) and the limitations
contained in Sections 801(a)(iii) and (iv) with respect to the Outstanding
Securities on and after the date the conditions set forth below are satisfied
(hereinafter, "Covenant Defeasance"), and the Securities shall thereafter be
deemed not to be "Outstanding" for the purposes of any direction, waiver,
consent or declaration or Act of Holders (and the consequences of any thereof)
in connection with such covenants, but shall continue to be deemed "Outstanding"
for all other purposes hereunder (it being understood that such Securities will
not be outstanding for accounting purposes). If the Company exercises its
covenant defeasance option, payment of the Securities may not be accelerated
because of an Event of Default specified under Section 501(iv), (vi), (vii)
(with respect only to Significant Subsidiaries), (viii) (with respect only to
Significant Subsidiaries) and (ix) or because of the failure of the Company to
comply with Sections 801(a)(iii) and (iv). 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 501(iv), but, except as specified above,
the remainder of this Indenture and such Securities shall be unaffected thereby.
SECTION 1204. Conditions to Legal Defeasance or Covenant
Defeasance.
The following shall be the conditions to application of either
Section 1202 or Section 1203 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 this Indenture who shall agree to comply with the
provisions of this Article Twelve applicable to it) as trust funds,
money or U.S. Government Obligations, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of
independent public accountants selected by the Company, to pay the
principal of, premium, if any, and interest due on the Outstanding
Securities on the Stated Maturity or on the applicable Redemption Date
as the case may be, of such principal, premium, if any, or interest on
the Outstanding Securities;
(ii) in the case of Legal Defeasance, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee (which opinion may be
subject to customary assumptions and exclusions) confirming that (A)
the Company has received from, or there has been published by, the
United States Internal Revenue Service a ruling or (B) since the date
of this Indenture, there has been a change in the applicable U.S.
Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel in the United States (which opinion may
be subject to customary assumptions and exclusions) shall confirm that,
the Holders of the Outstanding Securities will not recognize income,
gain or loss for U.S. Federal income tax purposes as a result of such
Legal Defeasance and will be subject to
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U.S. 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;
(iii) in the case of Covenant Defeasance, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United
States reasonably acceptable to the Trustee confirming that, subject to
customary assumptions and exclusions, the Holders of the Outstanding
Securities will not recognize income, gain or loss for U.S. Federal
income tax purposes as a result of such Covenant Defeasance and will be
subject to such 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;
(iv) no Default or Event of Default shall have
occurred and be continuing on the date of such deposit or insofar as
Events of Default from bankruptcy or insolvency events are concerned,
at any time in the period ending on the 123rd day after the date of
deposit;
(v) such Legal Defeasance or Covenant Defeasance
shall not result in a breach or violation of, or constitute a default
under, any material agreement or instrument (other than this Indenture)
to which the Company or any Subsidiary Guarantor is a party or by which
the Company or any Subsidiary Guarantor is bound;
(vi) the Company shall have delivered to the Trustee
an Opinion of Counsel to the effect that, as of the date of such
opinion and subject to customary assumptions and exclusions following
the deposit, the trust funds will not be subject to the effect of any
applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally under any applicable U.S. Federal
or state law, and that the Trustee has a perfected security interest in
such trust funds for the ratable benefit of the Holders;
(vii) 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 defeating, hindering, delaying or defrauding
any creditors of the Company or any Subsidiary Guarantor or others;
(viii) the Company shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel in the
United States (which Opinion of Counsel may be subject to customary
assumptions and exclusions) each stating that all conditions precedent
provided for or relating to the Legal Defeasance or the Covenant
Defeasance, as the case may be, have been complied with; and
(ix) the Company shall have delivered to the Trustee
the opinion of a nationally recognized firm of independent public
accountants stating the matters set forth in paragraph (i) above.
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SECTION 1205. Deposited Money and Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section
1003, all money and Government Obligations (including the proceeds thereof)
deposited with the Trustee (or other qualifying trustee, collectively for
purposes of this Section 1205, the "Trustee") pursuant to Section 1204 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
(including the Company acting as its own 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 premium, if any) and interest, but such
money need not be segregated from other funds except to the extent required by
law. Money and U.S. Government Obligations so held in trust are not subject to
Article Thirteen.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 1204 or the principal and interest
received in respect thereof.
Anything in this Article Twelve to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon Company request any money or U.S. Government Obligations held by it as
provided in Section 1204 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, as applicable, in accordance with this Article.
SECTION 1206. Reinstatement.
If the Trustee or any Paying Agent is unable to apply any
money or Government Obligations in accordance with Section 1205 by reason of any
legal proceeding or by any reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 1202 or 1203, as the case may be, until such time as the
Trustee or Paying Agent is permitted to apply all such money in accordance with
Section 1205; provided, however, that if the Company makes any payment of
principal of (or premium, if any) or interest on any Security following 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 money and
U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE THIRTEEN.
SUBORDINATION OF SECURITIES
SECTION 1301. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a
Security, by his acceptance thereof, likewise covenants and agrees, for the
benefit of the holders, from time to time, of Senior Indebtedness that, to the
extent and in the manner hereinafter set forth in this
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Article, the Indebtedness represented by the Securities and the payment of the
principal of (and premium, if any) and interest on each and all of the
Securities and all other Subordinated Obligations are hereby expressly made
subordinate and subject in right of payment as provided in this Article to the
prior payment in full in cash or Cash Equivalents of all Senior Indebtedness,
whether outstanding on the date of the Existing Indenture or thereafter
incurred, created, assumed or, except as set forth in Section 1014, guaranteed.
The Securities will in all respects rank pari passu with all other Senior
Subordinated Indebtedness of the Company.
SECTION 1302. Payment over of Proceeds upon Dissolution, Etc.
Upon any payment or distribution of the assets of the Company
upon a total or partial liquidation or dissolution or reorganization or
bankruptcy of or similar proceeding relating to the Company or its property:
(i) the holders of Senior Indebtedness will be
entitled to receive payment in full in cash or Cash Equivalents of the
Senior Indebtedness (including interest after, or which would accrue
but for, the commencement of any proceeding at the rate specified in
the applicable Senior Indebtedness, whether or not a claim for such
interest would be allowed in a proceeding) before the holders of the
Securities are entitled to receive any payment, and
(ii) until the Senior Indebtedness is paid in full in
cash or Cash Equivalents, any payment or distribution to which holders
of the Securities would be entitled but for the subordination
provisions of this Indenture will be made to holders of the Senior
Indebtedness as their interests may appear (except that holders of
Securities may receive securities that are subordinated at least to the
same extent as the Securities to the Senior Indebtedness and any
securities issued in exchange for any Senior Indebtedness).
SECTION 1303. Suspension of Payment When Senior Indebtedness
in Default.
(a) The Company may not pay principal of, premium, if any, or
interest on, the Securities or make any deposit pursuant to the provisions
described under "Defeasance" and may not otherwise purchase, redeem or otherwise
retire any Securities (collectively, "pay the Securities") if:
(i) any Senior Indebtedness is not paid when due in
cash or Cash Equivalents; or
(ii) any other default on Senior Indebtedness occurs
and the maturity of such Senior Indebtedness is accelerated in
accordance with its terms unless, in either case, the default has been
cured or waived and any such acceleration has been rescinded or such
Senior Indebtedness has been paid in full in cash or Cash Equivalents;
provided, however, the Company may pay the Securities without regard to the
foregoing if the Company and the Trustee receive written notice approving such
payment from the Representative of the Senior Indebtedness with respect to which
either of the events set forth in clause (i) or (ii) above has occurred and is
continuing.
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(b) During the continuance of any default (other than a
default described in clause (a) (i) or (a) (ii) above) with respect to any
Designated Senior Indebtedness pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable grace
periods, the Company may not pay the Securities for a period (a "Payment
Blockage Period") commencing upon the receipt by the Trustee (with a copy to the
Company) of written notice (a "Blockage Notice") of such default from the
Representative of the holders of such Designated Senior Indebtedness specifying
an election to effect a Payment Blockage Period and ending 179 days thereafter
(or earlier if such Payment Blockage Period is terminated (i) by written notice
to the Trustee and the Company from the Person or Persons who gave such Blockage
Notice, (ii) because the default giving rise to such Blockage Notice is no
longer continuing or (iii) because such Designated Senior Indebtedness has been
repaid in full (or such payment has been duly provided for in a manner
acceptable to the holders of such Designated Senior Indebtedness).
Notwithstanding the provisions described in the immediately preceding sentence
(but subject to Section 1303(a)), unless the holders of such Designated Senior
Indebtedness or the Representative of such holders have accelerated the maturity
of such Designated Senior Indebtedness, the Company may resume payments on the
Securities after the end of such Payment Blockage Period. Not more than one
Blockage Notice may be given in any consecutive 360-day period, irrespective of
the number of defaults with respect to Designated Senior Indebtedness during
such period. However, if any Blockage Notice within such 360-day period is given
by or on behalf of any holders of Designated Senior Indebtedness other than Bank
Indebtedness, a Representative of Bank Indebtedness may give one additional
Blockage Notice within such period. In no event, however, may the total number
of days during which any Payment Blockage Period or Periods is in effect exceed
179 days in the aggregate during any 360 consecutive day period.
SECTION 1304. Acceleration of Securities.
If payment of the Securities is accelerated because of an
Event of Default, the Company or the Trustee shall promptly notify the holders
of the Designated Senior Indebtedness or the Representative of such holders of
the acceleration. The Company may not pay the Securities until five Business
Days after such holders or the Representative of the Designated Senior
Indebtedness receive notice of such acceleration and, thereafter, may pay the
Securities only if the subordination provisions of this Indenture otherwise
permit payment at that time.
SECTION 1305. When Distribution Must Be Paid Over.
If a distribution is made to Holders of the Securities that,
due to the provisions of this Article Thirteen, should not have been made to
them, such Holders are required to hold it in trust for the Holders of Senior
Indebtedness and pay it over to them as their interests may appear.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform only such obligations on the part of the Trustee
as are specifically set forth in this Article Thirteen, and no implied covenants
or obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders if the Trustee shall pay over or distribute to or on
behalf of Holders or the
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Company or any other Person money or assets to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article Thirteen, except if
such payment is made as a result of the willful misconduct or gross negligence
of the Trustee.
SECTION 1306. Notice by Company.
The Company shall promptly notify the Trustee and the Paying
Agent of any facts known to the Company that would cause a payment of any
Obligations with respect to the Securities that violate this Article, but
failure to give such notice shall not affect the subordination of the Securities
to the Senior Indebtedness as provided in this Article Thirteen.
SECTION 1307. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this
Indenture or in any of the Securities shall prevent the Company, at any time
except during the pendency of any case, proceeding, dissolution, liquidation or
other winding up, assignment for the benefit of creditors or other marshalling
of assets and liabilities of the Company referred to in Section 1302 or under
the conditions described in Section 1303, from making payments at any time of
principal of (and premium, if any, on) or interest on the Securities.
SECTION 1308. Subrogation to Rights of Holders of Senior
Indebtedness.
Subject to the payment in full of all Senior Indebtedness in
cash or Cash Equivalents, the Holders shall be subrogated (equally and ratably
with the holders of all pari passu Indebtedness of the Company) to the rights of
the holders of such Senior Indebtedness to receive payments and distributions of
cash, property and securities applicable to the Senior Indebtedness until the
Subordinated Obligations shall be paid in full. For purposes of such
subrogation, no payments or distributions to the holders of Senior Indebtedness
of any cash, property or securities to which the Holders of the Securities or
the Trustee would be entitled except for the provisions of this Article, and no
payments pursuant to the provisions of this Article to the holders of Senior
Indebtedness by Holders of the Securities or on their behalf or by the Trustee,
shall, as among the Company, its creditors other than holders of Senior
Indebtedness, and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Indebtedness; it
being understood that the provisions of this Article are intended solely for the
purpose of determining the relative rights of the Holders of the Securities, on
the one hand, and the holders of Senior Indebtedness, on the other hand.
SECTION 1309. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for
the purpose of defining the relative rights of the Holders on the one hand and
the holders of Senior Indebtedness on the other hand. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall (a) impair, as 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 premium, if any) and interest on the Securities as and when
the same shall become due and payable in accordance with their terms; (b) affect
the relative rights against the Company of the Holders and creditors of the
Company other than their rights in relation to holders of Senior Indebtedness;
or (c) prevent the Trustee or any Holder from exercising all
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remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article of the holders of
Senior Indebtedness. If the Company fails because of this Article to pay
principal (or premium, if any) or interest on a Security on the due date, the
failure is still a Default or Event of Default.
SECTION 1310. Trustee to Effectuate Subordination.
Each Holder of a Security by his acceptance thereof authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article and appoints the Trustee his attorney-in-fact for any and all such
purposes. If the Trustee does not file a proper proof of claim or proof of debt
in the form required in any proceeding referred to in Section 504 hereof at
least 30 days before the expiration of the time to file such claim, the agent
bank under the Senior Credit Facility (if such facility is still outstanding) is
hereby authorized to file an appropriate claim for and on behalf of the Holders
of the Securities.
SECTION 1311. Subordination May Not Be Impaired by Company.
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.
SECTION 1312. Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice given to
holders of Senior Indebtedness, the distribution may be made and the notice
given to their Representative.
Upon any payment or distribution of assets of the Company
referred to in this Article Thirteen, the Trustee and the Holders shall be
entitled to rely upon any order or decree made by any court of competent
jurisdiction or upon any certificate of such Representative or of the
liquidating trustee or agent or other Person making any distribution to the
Trustee or to the Holders for the purpose of ascertaining the Persons entitled
to participate in such distribution, the holders of the Senior Indebtedness and
other Indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other acts pertinent
thereto or to this Article Thirteen.
SECTION 1313. Notice to Trustee.
(a) The Company shall give prompt written notice to the
Trustee of any fact known to the Company which would prohibit the making of any
payment to or by the Trustee in respect of the Securities. Notwithstanding the
provisions of this Article or any other provision of this Indenture, the Trustee
shall not be charged with knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee in respect of the
Securities, unless and until the Trustee shall have received written notice
thereof from the Company, agent bank under the Senior Credit Facility or a
holder of Senior Indebtedness or from any trustee,
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fiduciary or agent therefor; and, prior to the receipt of any such written
notice, the Trustee, subject to TIA Sections 315(a) through 315(d), shall be
entitled in all respects to assume that no such facts exist; provided, however,
that, if the Trustee shall not have received the notice provided for in this
Section at least three Business Days prior to the date upon which by the terms
hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of (and premium, if any) or interest on
any Security), then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such money and to
apply the same to the purpose for which such money was received and shall not be
affected by any notice to the contrary which may be received by it within three
Business Days prior to such date.
(b) Subject to TIA Sections 315(a) through 315(d), the Trustee
shall be entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Indebtedness (or a trustee,
fiduciary or agent therefor) to establish that such notice has been given by a
holder of Senior Indebtedness (or a trustee, fiduciary or agent therefor). In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article and, if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
SECTION 1314. Reliance on Judicial Order or Certificate of
Liquidating Agent.
Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to TIA Sections 315(a) through
315(d), and the Holders of the Securities shall be entitled to rely upon any
order or decree entered by any court of competent jurisdiction in which such
insolvency, bankruptcy, receivership, liquidation, reorganization, dissolution,
winding up or similar case or proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article;
provided that such court, trustee, receiver, custodian, assignee, agent or other
Person has been apprised of, or the order, decree or certificate makes reference
to, the provisions of this Article.
SECTION 1315. Rights of Trustee as a Holder of Senior
Indebtedness; Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall
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deprive the Trustee of any of its rights as such holder. Nothing in this Article
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section 607.
SECTION 1316. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee
shall have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying Agent
within its meaning as fully for all intents and purposes as if such Paying Agent
were named in this Article in addition to or in place of the Trustee; provided,
however, that Section 1315 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.
SECTION 1317. No Suspension of Remedies.
Nothing contained in this Article shall limit the right of the
Trustee or the Holders of Securities to take any action to accelerate the
maturity of the Securities pursuant to Article Five or to pursue any rights or
remedies hereunder or under applicable law, except as provided in Article Five.
SECTION 1318. Modification of Terms of Senior Indebtedness.
Any renewal or extension of the time of payment of any Senior
Indebtedness or the exercise by the holders of Senior Indebtedness of any of
their rights under any instrument creating or evidencing Senior Indebtedness,
including, without limitation, the waiver of default thereunder, may be made or
done all without notice to or assent from the Holders or the Trustee.
No compromise, alteration, amendment, modification, extension,
renewal or other change of, or waiver, consent or other action in respect of,
any liability or obligation under or in respect of, or of any of the terms,
covenants or conditions of any indenture or other instrument under which any
Senior Indebtedness is outstanding or of such Senior Indebtedness, whether or
not such release is in accordance with the provisions of any applicable
document, shall in any way alter or affect any of the provisions of this Article
Thirteen or of the Securities relating to the subordination thereof.
SECTION 1319. Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary,
payments from cash or the proceeds of U.S. Government Obligations held in trust
under Article Twelve hereof by the Trustee (or other qualifying trustee) and
which were deposited in accordance with the terms of Article Twelve hereof and
not in violation of Section 1303 hereof for the payment of principal of (and
premium, if any) and interest on the Securities shall not be subordinated to the
prior payment of any Senior Indebtedness or subject to the restrictions set
forth in this Article Thirteen, and none of the Holders shall be obligated to
pay over any such amount to the Company or any holder of Senior Indebtedness or
any other creditor of the Company.
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This Indenture may be signed in any number of counterparts
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Indenture.
SECTION 1320. Trustee Not Fiduciary for Holders of Senior
Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to
the holders of Senior Indebtedness and shall not be liable to any such holders
if the Trustee shall in good faith mistakenly pay over or distribute to Holders
of Securities or to the Company or to any other person cash, property or
securities to which any holders of Senior Indebtedness shall be entitled by
virtue of this Article or otherwise. With respect to the holders of Senior
Indebtedness, the Trustee undertakes to perform or to observe only such of its
covenants or obligations as are specifically set forth in this Article and no
implied covenants or obligations with respect to holders of Senior Indebtedness
shall be read into this Indenture against the Trustee.
ARTICLE FOURTEEN.
SUBSIDIARY GUARANTEES
SECTION 1401. Subsidiary Guarantees.
(a) Each Subsidiary Guarantor hereby unconditionally and
irrevocably guarantees, jointly and severally, to each Holder and to the Trustee
and its successors and assigns on an unsecured senior subordinated basis (i) the
full and punctual payment of principal of, premium, if any, and interest on the
Securities when due, whether at maturity, by acceleration, by redemption, by
required repurchase or otherwise, and all other monetary obligations of the
Company and the Subsidiary Guarantors under this Indenture and the Securities
and (ii) the full and punctual performance within applicable grace periods of
all other obligations of the Company and the Subsidiary Guarantors under this
Indenture and the Securities (all the foregoing being hereinafter collectively
called the "Guaranteed Obligations"). Each Subsidiary Guarantor agrees that the
Guaranteed Obligations may be extended or renewed, in whole or in part, without
further notice or further assent from such Subsidiary Guarantor and that such
Subsidiary Guarantor will remain bound under this Article XIV notwithstanding
any extension or renewal of any Guaranteed Obligation.
(b) Each Subsidiary Guarantor waives presentation to, demand
of, payment from and protest to the Company of any of the Guaranteed Obligations
and also waives notice of protest for nonpayment. Each Subsidiary Guarantor
waives notice of any default under the Securities or the Guaranteed Obligations.
The Guaranteed Obligations of each Subsidiary Guarantor hereunder shall not be
affected by (a) the failure of any Holder or the Trustee to assert any claim or
demand or to enforce any right or remedy against the Company or any other Person
under this Indenture, the Securities or any other agent or otherwise; (b) any
extension or renewal of any thereof; (c) any rescission, waiver, amendment or
modification of any of the terms or provisions of this Indenture, the Securities
or any other agreement; (d) the release of any security held by any Holder or
the Trustee for the Guaranteed Obligations or any of them; (e) the failure of
any Holder or the Trustee to exercise any right or remedy against any other
guarantor of the
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Guaranteed Obligations; (f) subject to Section 1405, any change in the ownership
of such Subsidiary Guarantor; or (g) any other circumstance which might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
(c) Each Subsidiary Guarantor further agrees that its
Subsidiary Guarantee herein constitutes a guarantee of payment, performance and
compliance when due (and not a guarantee of collection) and waives any right to
require that any resort be had by any Holder or the Trustee to any security held
for payment of the Guaranteed Obligations.
(d) Except as expressly set forth in Sections 1402, 1404, 1202
and 1203, the obligations of each Subsidiary Guarantor hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason,
including any claim of waiver, release, surrender, alteration or compromise, and
shall not be subject to any defense of setoff, counterclaim, recoupment or
termination whatsoever or by reason of the invalidity, illegality or
unenforceability of the Guaranteed Obligations or otherwise. Without limiting
the generality of the foregoing, the obligations of each Subsidiary Guarantor
herein shall not be discharged or impaired or otherwise affected by the failure
of any Holder or the Trustee to assert any claim or demand or to enforce any
remedy under this Indenture, the Securities or any other agreement, by any
waiver or modification of any thereof, by any default, failure or delay, willful
or otherwise, in the performance of the obligations, or by any other act or
thing or omission or delay to do any other act or thing which may or might in
any manner or to any extent vary the risk of such guarantor or would otherwise
operate as a discharge of such Subsidiary Guarantor as a matter of law or
equity.
(e) Each Subsidiary Guarantor further agrees that its
Subsidiary Guarantee herein shall continue to be effective or be reinstated, as
the case may be, if at any time payment, or any part thereof, of principal of or
interest on any Guaranteed Obligation is rescinded or must otherwise be restored
by any Holder or the Trustee upon the bankruptcy or reorganization of the
Company or otherwise.
(f) In furtherance of the foregoing and not in limitation of
any other right which any Holder or the Trustee has at law or in equity against
any Subsidiary Guarantor by virtue hereof, upon the failure of the Company to
pay the principal of or interest on any Guaranteed Obligation when and as the
same shall become due, whether at maturity, by acceleration, by redemption or
otherwise, or to perform or comply with any other Guaranteed Obligation, each
Subsidiary Guarantor hereby promises to and will, upon receipt of written demand
by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or
the Trustee an amount equal to the sum of (i) the unpaid amount of such
Guaranteed Obligations, (ii) accrued and unpaid interest on such Guaranteed
Obligations (but only to the extent not prohibited by law) and (iii) all other
monetary Guaranteed Obligations of the Company or the Subsidiary Guarantors to
the Holders and the Trustee.
(g) Each Subsidiary Guarantor agrees that, as between it, on
the one hand, and the Holders and the Trustee, on the other hand, (x) the
maturity of the Guaranteed Obligations guaranteed hereby may be accelerated as
provided in Article VIII for the purposes of such Guarantee herein,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Guaranteed Obligations guaranteed hereby, and (y)
in the event of
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any declaration of acceleration of such Guaranteed Obligations as provided in
Article V, such Guaranteed Obligations (whether or not due and payable) shall
forthwith become due and payable by such Subsidiary Guarantor for the purposes
of this Section 1401.
(h) Each Subsidiary Guarantor also agrees to pay any and all
costs and expenses (including attorneys' fees and disbursements) incurred by the
Trustee or any Holder in enforcing or obtaining advice of counsel in respect of
any rights with respect to or collecting such Subsidiary Guarantor under this
Subsidiary Guarantee under this Section 1401.
SECTION 1402. Limitation on Liability.
Each Subsidiary Guarantor agrees that the Guaranteed
Obligations may at any time and from time to time exceed the amount of the
liability of such Subsidiary Guarantor hereunder without impairing this
Subsidiary Guarantee or affecting the rights and remedies of the Agent or any
Lender hereunder; provided, however, that any term or provision of this
Indenture to the contrary notwithstanding, the maximum aggregate amount of the
Guaranteed Obligations guaranteed hereunder by any Subsidiary Guarantor shall
not exceed the maximum amount that can be guaranteed hereby without rendering
this Indenture, as it relates to such Subsidiary Guarantor, void or voidable
under applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally.
SECTION 1403. No Waiver.
Neither a failure nor a delay on the part of either the
Trustee or the Holders in exercising any right, power or privilege under this
Article XIV shall operate as a waiver thereof, or shall a single or partial
exercise thereof preclude any other or further exercise of any right, power or
privilege. The rights, remedies and benefits of the Trustee and the Holders
herein expressly specified are cumulative and not exclusive of any other rights,
remedies or benefits which either may have under this Article XIV at law, in
equity, by statute or otherwise.
SECTION 1404. Modification.
No modification, amendment or waiver of any provision of this
Article XIV, nor the consent to any departure by any Subsidiary Guarantor
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Trustee, and then such waiver or consent shall be effective
only in the specific instance and for the purposes for which given. No notice to
or demand on any Subsidiary Guarantor in any case shall entitle such Subsidiary
Guarantor to any other or further notice or demand in the same, similar or other
circumstance.
SECTION 1405. Release of Subsidiary Guarantor.
Upon the occurrence of a sale or other disposition (including
by way of consolidation or merger) of a Subsidiary Guarantor or the sale or
disposition of all or substantially all the assets of such Subsidiary Guarantor
(in each case other than to the Company or an Affiliate of the Company) pursuant
to and in accordance with the terms and provisions of this Indenture, such
Subsidiary Guarantor shall be deemed released from all obligations under this
Article XIV without any further action required on the part of the Trustee or
any Holder; provided, however, that any such release will occur only to the
extent that all obligations of such
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Subsidiary Guarantor under the Senior Credit Facility and all of its Guarantees
of, and under all of its pledges of assets or other security interests which
secure, any other Indebtedness of the Company will also terminate concurrently
with such release. At the request of the Company and upon receipt of an
Officers' Certificate, the Trustee shall execute and deliver an appropriate
instrument evidencing such release.
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IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year first above written.
RENT-A-CENTER, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Chief Executive Officer
COLORTYME, INC., as a Subsidiary Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
ADVANTAGE COMPANIES, INC., as a
Subsidiary Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
President
THE BANK OF NEW YORK,
as Trustee
By: /s/ Van ▇. ▇▇▇▇▇
---------------------------------
Van ▇. ▇▇▇▇▇
Vice President
