1
EXHIBIT 4.1
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MSX INTERNATIONAL, INC.,
as Company,
THE SUBSIDIARY GUARANTORS named herein
and
IBJ XXXXXXXX BANK & TRUST COMPANY,
as Trustee
11 3/8% Senior Subordinated Notes Due 2008
____________________
INDENTURE
Dated as of January 15, 1998
____________________
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CROSS-REFERENCE TABLE
TIA Section Indenture Section
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310(a)(1) 7.9; 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 7.10
(b)... 7.8; 7.10
(c)... N.A.
311(a) 7.11
(b)... 7.11
312(a) 2.5
(b)... 13.3
(c)... 13.3
313(a) 7.6
(b)(1) 7.6
(b)(2) N.A.
(c)... 13.2
(d)... 7.6
314(a) 4.2; 4.10; 4.13; 13.2
(b)... 7.6
(c)(1) 13.4
(c)(2) 13.4
(c)(3) N.A.
(d)... N.A.
(e)... 13.5
(f)... 4.10
315(a) 7.1
(b)... 7.5; 13.2
(c)... 7.1
(d)... 7.1
(e)... 6.11
316(a)(last sentence) 13.6
(a)(1)(A) 6.5
(a)(1)(B) 6.4
(a)(2) N.A.
(b) 6.7
317(a)(1) 6.8
(a)(2) 6.9
(b) 2.4
318(a) 13.1
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
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TABLE OF CONTENTS
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions 1
SECTION 1.2. Other Definitions 25
SECTION 1.3. Incorporation by Reference of Trust
Indenture Act 26
SECTION 1.4. Rules of Construction 26
ARTICLE 2
THE SECURITIES
SECTION 2.1. Form and Dating 27
SECTION 2.2. Execution and Authentication 28
SECTION 2.3. Registrar and Paying Agent 29
SECTION 2.4. Paying Agent To Hold Money in Trust 30
SECTION 2.5. Securityholder Lists 30
SECTION 2.6. Transfer and Exchange 31
SECTION 2.7. Replacement Securities 34
SECTION 2.8. Outstanding Securities 35
SECTION 2.9. Temporary Securities 35
SECTION 2.10 Cancellation 35
SECTION 2.11. Defaulted Interest 36
SECTION 2.12. CUSIP Numbers 36
SECTION 2.13. Restrictive Legends 36
SECTION 2.14. Special Transfer Provisions 38
ARTICLE 3
REDEMPTION
SECTION 3.1. Optional Redemption 41
SECTION 3.2. Notices to Trustee 42
SECTION 3.3. Selection of Securities To Be Redeemed 42
SECTION 3.4. Notice of Redemption 43
SECTION 3.5. Effect of Notice of Redemption 44
SECTION 3.6. Deposit of Redemption Price 44
SECTION 3.7. Securities Redeemed in Part 44
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ARTICLE 4
COVENANTS
SECTION 4.1. Payment of Securities 45
SECTION 4.2. SEC Reports 45
SECTION 4.3. Limitation on Incurrence of Indebtedness 46
SECTION 4.4. Limitation on Layered Debt 48
SECTION 4.5. Limitation on Restricted Payments 48
SECTION 4.6. Limitation on Restrictions on Distributions from Restricted
Subsidiaries 51
SECTION 4.7. Limitation on Sales of Assets and Subsidiary
Stock 52
SECTION 4.8. Limitation on Affiliate Transactions 56
SECTION 4.9. Limitation on Issuance or Sale of Capital Stock of Restricted
Subsidiaries 58
SECTION 4.10. Limitation on Liens 58
SECTION 4.11. Designation of Restricted and Unrestricted
Subsidiaries 59
SECTION 4.12. Change of Control 60
SECTION 4.13. Compliance Certificate 62
SECTION 4.14. Further Instruments and Acts 62
SECTION 4.15. Payment of Taxes and Other Claims 62
SECTION 4.16. Future Guarantors 63
SECTION 4.17. Maintenance of Office or Agency 63
SECTION 4.18. Corporate Existence 64
ARTICLE 5
SUCCESSOR COMPANY
SECTION 5.1. Merger, Consolidation and Sale of Assets 64
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.1. Events of Default 66
SECTION 6.2. Acceleration 68
SECTION 6.3. Other Remedies 69
SECTION 6.4. Waiver of Past Defaults 69
SECTION 6.5. Control by Majority 69
SECTION 6.6. Limitation on Suits 70
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SECTION 6.7. Rights of Holders to Receive Payment 70
SECTION 6.8. Collection Suit by Trustee 70
SECTION 6.9. Trustee May File Proofs of Claim 71
SECTION 6.10. Priorities 71
SECTION 6.11. Undertaking for Costs 72
SECTION 6.12. Waiver of Stay or Extension Laws 72
ARTICLE 7
TRUSTEE
SECTION 7.1. Duties of Trustee 72
SECTION 7.2. Rights of Trustee 74
SECTION 7.3. Individual Rights of Trustee 75
SECTION 7.4. Trustee's Disclaimer 75
SECTION 7.5. Notice of Defaults 75
SECTION 7.6. Reports by Trustee to Holders 76
SECTION 7.7. Compensation and Indemnity 76
SECTION 7.8. Replacement of Trustee 77
SECTION 7.9. Successor Trustee by Merger 78
SECTION 7.10. Eligibility; Disqualification 79
SECTION 7.11. Preferential Collection of Claims Against Company 79
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.1. Discharge of Liability on Securities; 79
Defeasance
SECTION 8.2. Conditions to Defeasance 81
SECTION 8.3. Application of Trust Money 82
SECTION 8.4. Repayment to Company 83
SECTION 8.5. Indemnity for Government Obligations 83
SECTION 8.6. Reinstatement 83
ARTICLE 9
AMENDMENTS
SECTION 9.1. Without Consent of Holders 84
SECTION 9.2. With Consent of Holders 85
SECTION 9.3. Compliance with Trust Indenture Act 86
SECTION 9.4. Revocation and Effect of Consents
and Waivers 86
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SECTION 9.5. Notation on or Exchange of Securities 86
SECTION 9.6. Trustee to Sign Amendments 87
ARTICLE 10
SUBORDINATION OF THE SECURITIES
SECTION 10.1. Agreement To Subordinate 87
SECTION 10.2. Liquidation; Dissolution; Bankruptcy 88
SECTION 10.3. Default on Senior Indebtedness 90
SECTION 10.4. Payment of Subordinated Debt Permitted if No
Default 91
SECTION 10.5. Notices by the Company 92
SECTION 10.6. Subrogation 92
SECTION 10.7. Relative Rights 92
SECTION 10.8. Subordination May Not Be Impaired by the
Company 93
SECTION 10.9. Distribution of Notice to Representative 93
SECTION 10.10. Rights of Trustee and Paying Agent 93
SECTION 10.11. Consent of Holders of Specified Senior
Indebtedness 94
SECTION 10.12. Contractual Subordination 94
ARTICLE 11
SUBSIDIARY GUARANTEES
SECTION 11.1. Guarantees 95
SECTION 11.2. Limitation on Liability 97
SECTION 11.3. Successors and Assigns 98
SECTION 11.4. No Waiver 98
SECTION 11.5. Modification 98
SECTION 11.6. Release of Subsidiary Guarantor 98
SECTION 11.7. Execution of Supplemental Indenture
for Future Subsidiary Guarantors 99
ARTICLE 12
SUBORDINATION OF SUBSIDIARY GUARANTEES
SECTION 12.1. Agreement To Subordinate 99
SECTION 12.2. Liquidation; Dissolution; Bankruptcy 100
SECTION 12.3. Default on Subsidiary Guarantor Senior
Indebtedness 102
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SECTION 12.4. Payments of Subordinated Debt
Permitted if No Default 103
SECTION 12.5. Notices by a Subsidiary Guarantor 104
SECTION 12.6. Subrogation 104
SECTION 12.7. Relative Rights 104
SECTION 12.8. Subordination May Not Be Impaired
by the Subsidiary Guarantor 105
SECTION 12.9. Distribution or Notice to
Representative 105
SECTION 12.10. Rights of Trustee and Paying Agent 105
SECTION 12.11. Consent of Holders of Senior
Indebtedness 106
SECTION 12.12. Contractual Subordination 106
ARTICLE 13
MISCELLANEOUS
SECTION 13.1. Trust Indenture Act Controls 107
SECTION 13.2. Notices 107
SECTION 13.3. Communication by Holders with Other
Holders 108
SECTION 13.4. Certificate and Opinion as to
Conditions Precedent 108
SECTION 13.5. Statements Required in Certificate
or Opinion 108
SECTION 13.6. When Securities Disregarded 109
SECTION 13.7. Rules by Trustee, Paying Agent and
Registrar 109
SECTION 13.8. Legal Holidays 109
SECTION 13.9. Governing Law 110
SECTION 13.10. No Recourse Against Others 110
SECTION 13.11. Successors 110
SECTION 13.12. Multiple Originals 110
SECTION 13.13. Table of Contents; Headings 110
SECTION 13.14. Severability Clause 111
Signatures 100
Exhibit A - Form of Security A-1
Exhibit B - Form of Exchange Security B-1
Exhibit C - Form of Certificate To Be Delivered in
Connection with Transfers to Non-QIB
Accredited Investors C-1
Exhibit D - Form of Certificate To Be Delivered in
Connection with Transfers Pursuant
to Regulation S D-1
Exhibit E - Form of Guarantee X-0
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0
Page
Note: This Table of Contents shall not, for any purpose, be deemed to be
part of the Indenture.
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9
INDENTURE dated as of January 15, 1998, between MSX INTERNATIONAL, INC., a
Delaware corporation (the "Company"), certain of the Company's subsidiaries
signatory hereto (each, a "Subsidiary Guarantor" and, collectively, the
"Subsidiary Guarantors") and IBJ XXXXXXXX BANK & TRUST COMPANY, a national
banking corporation, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Company's 11 3/8% Senior
Subordinated Notes Due 2008 (the "Securities"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. Definitions.
"Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) in a Related Business, including improvements
to existing assets, 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; provided, however, that any such Restricted
Subsidiary is primarily engaged in a Related Business; (iii) Capital Stock
constituting an additional equity interest in any Person that at such time is a
Restricted Subsidiary that is not a Wholly-Owned Subsidiary; or (iv) the costs
of improving or developing any property owned by the Company or a Restricted
Subsidiary that is used in a Related Business.
"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 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. For
purposes of the provisions described under Sections 4.5, 4.7 and 4.8 only,
"Affiliate" shall also mean any beneficial owner of Capital Stock representing
10% or more of the total voting power of the Voting Stock (on a fully diluted
basis) of the Company or of rights or warrants to purchase such Capital Stock
(whether or not currently exercisable) and any Person who would be an Af-
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filiate of any such beneficial owner pursuant to the first sentence hereof.
"Asset Disposition" means any sale, lease, transfer, Sale/Leaseback
Transaction or other disposition (or series of related sales, leases, transfers
or dispositions) by the Company or any Restricted Subsidiary, including any
disposition by means of a merger, consolidation or similar transaction (each
referred to for the purposes of this definition as a "disposition"), of (i) any
shares of Capital Stock of a Restricted Subsidiary (other than directors'
qualifying shares and shares owned by foreign shareholders to the extent
required by applicable local laws in foreign countries), (ii) all or
substantially all the assets of any division, business segment or comparable
line of business of the Company or any Restricted Subsidiary or (iii) any other
assets of the Company or any Restricted Subsidiary outside of the ordinary
course of business of the Company or such Restricted Subsidiary.
Notwithstanding the foregoing, the term "Asset Disposition" shall not include
(x) a disposition by a Restricted Subsidiary to the Company or by the Company
or a Restricted Subsidiary to a Subsidiary Guarantor, (y) for purposes of
Section 4.7, a disposition that constitutes a Permitted Investment or a
Restricted Payment permitted by Section 4.5, and (z) a disposition of assets
having a fair market value of less than $1 million.
"Attributable Debt" in respect of a Sale/Leaseback Transaction means, as
at the time of determination, the present value (discounted at the interest
rate borne by the Securities, compounded annually) of the total obligations of
the lessee for rental payments during the remaining term of the lease included
in such Sale/Leaseback Transaction (including any period for which such lease
has been extended).
"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 product 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 Preferred Stock multiplied
by the amount of such payment by (ii) the sum of all such payments.
"Bank Credit Agreements" means the Senior Credit Facility and any other
bank credit agreement or similar facility now existing or entered into in the
future by the Company or any Restricted Subsidiary, as any of the same may be
amended, waived, modified, Refinanced or replaced from time to time
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(except to the extent that any such amendment, waiver, modification,
replacement or Refinancing would be prohibited by the terms of this Indenture).
"Bank Indebtedness" means any and all present and future amounts payable
under or in respect of the Bank Credit Agreements, including principal, premium
(if any), interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization, whether or not a claim for
post-filing interest is allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, guarantees and all other amounts and other
indebtedness and other Obligations and liabilities 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 of Directors.
"Business Day" means each day which is not a Legal Holiday.
"Capital Lease Obligations" means an obligation that is required to be
classified and accounted for as a capital 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 prior to the
first date upon which such lease may be terminated by the lessee without
payment of a penalty.
"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.
"Change of Control" means the occurrence of any of the following events:
(i) prior to the first public offering of Voting Stock of the
Company, the Permitted Investors cease to be entitled (by
"beneficial ownership" (as defined in Rules 13d-3 and 13d-5 under
the Exchange Act) of Voting Stock, contract or otherwise) to
elect or cause the election of directors having a majority in the
aggregate of the total voting power of the Board of Directors,
whether as a re-
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xxxx of issuance of securities of the Company, any merger, consolidation,
liquidation or dissolution of the Company, any direct or indirect
transfer of securities by the Permitted Investors or otherwise (for
purposes of this clause (i) and clause (ii) below, the Permitted
Investors shall be deemed to beneficially own any Voting Stock of any
entity (the "specified entity") held by any other entity (the "parent
entity") so long as the Permitted Investors beneficially own (as so
defined), directly or indirectly, in the aggregate a majority of the
voting power of the Voting Stock of such parent entity);
(ii) after the first public offering of Voting Stock of the Company,
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 clause (i) above, except that for
purposes of this clause (ii) such person shall be deemed to have
"beneficial ownership" of all shares that any such person has the right
to acquire, directly or indirectly) of more than 35% of the total voting
power of the Voting Stock of the Company and either (x) the Permitted
Holders beneficially own (as defined in clause (i) above), directly or
indirectly, in the aggregate a lesser percentage of the total voting
power of the Voting Stock of the Company than such other person and 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 or
(y) such other person is entitled to elect directors having a majority of
the total voting power of the Board of Directors; or
(iii) after the first public offering of Voting Stock of the
Company, during any period of not greater than two consecutive years
beginning after the Issue Date, 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.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Consolidated Coverage Ratio" as of any date of determination means the
ratio of (i) the aggregate amount of EBITDA for the period of the most recent
four consecutive fiscal quarters ending at least 45 days (or, if less, the
number of days after the end of such fiscal quarter as the consolidated
financial statements of the Company shall be available) prior to the date of
such determination to (ii) Consolidated Interest Expense for such four fiscal
quarters; provided, however, that (1) if the Company or any Restricted
Subsidiary has Incurred any Indebtedness since the beginning of 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, or both, 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 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 (except that, in
the case of Indebtedness used to finance working capital needs incurred under a
revolving credit or similar arrangement, the amount thereof shall be deemed to
be the average daily balance of such Indebtedness during such
four-fiscal-quarter period), (2) if since the beginning of such period the
Company or any Restricted Subsidiary shall have made any Asset Disposition, the
EBITDA for such period shall be reduced by an amount equal to the EBITDA (if
positive) directly attributable to the assets which 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, assumed by a third person (to the extent the Company and its
Restricted Subsidiaries are no longer liable for such Indebtedness) or
otherwise discharged with respect to the Company and its continuing Restricted
Subsidiaries in connection with such Asset Disposition for such period (or, 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 shall have
consummated a Public Equity Offering following which there is a Public Market,
Consolidated Interest Expense for such period shall be reduced by
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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 Restricted Subsidiaries in connection with such Public Equity Offering for
such period, (4) if since the beginning of such period the Company or any
Restricted Subsidiary (by merger or otherwise) shall have made an Investment in
any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary)
or an acquisition of assets, which acquisition constitutes all or substantially
all of an operating unit of a business, including any such Investment or
acquisition occurring in connection with a transaction requiring 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) as if such Investment or acquisition occurred
on the first day of such period and (5) 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, any Investment or acquisition of
assets that would have required an adjustment pursuant to clause (3) or (4)
above if made by the Company or a Restricted Subsidiary during such period,
EBITDA and Consolidated Interest Expense for such period shall be calculated
after giving pro forma effect thereto as if such Asset Disposition, Investment
or acquisition occurred on the first day of such period. For purposes of this
definition, whenever pro forma effect is to be given to an acquisition of
assets, the amount of income or earnings relating thereto and the amount of
Consolidated Interest Expense associated with any Indebtedness Incurred in
connection therewith, the pro forma calculations shall be determined in good
faith by a responsible financial or accounting Officer of the Company in
accordance with Article 11 of Regulation S-X. If any Indebtedness bears a
floating rate of interest and is being given pro forma effect, the interest on
such Indebtedness shall be calculated 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 in excess of 12 months).
"Consolidated Interest Expense" means, for any period, the total interest
expense of the Company and its consolidated Restricted Subsidiaries, plus, to
the extent not included in such total interest expense, and to the extent
incurred by the Company or its Restricted Subsidiaries, (i) in-
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terest expense attributable to Capital Lease Obligations, (ii) amortization of
debt discount, (iii) capitalized interest, (iv) non-cash interest expenses, (v)
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers' acceptance financing, (vi) net costs associated with
Hedging Obligations (including amortization of fees), and (vii) interest
actually paid on any Indebtedness of any other Person that is Guaranteed by the
Company or any Restricted Subsidiary.
"Consolidated Net Income" means, for any period, the net income of the
Company and its consolidated Subsidiaries; provided, however, that there shall
not be included in such Consolidated Net Income: (i) any net income (or loss)
of any Person if such Person is not a Restricted Subsidiary, except that
subject to the exclusion contained in clause (iv) below, the Company'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 Company or a Restricted Subsidiary as
a dividend or other distribution (subject, in the case of a dividend or other
distribution paid to a Restricted Subsidiary, to the limitations contained in
clause (iii) below); (ii) for purposes of subclause (a)(3)(A) of Section 4.5
only, any net income (or loss) of any Person acquired by the Company or a
Subsidiary in a pooling of interests transaction for any period prior to the
date of such acquisition; (iii) any net income of any Restricted Subsidiary if
such Restricted Subsidiary is subject to restrictions, directly or indirectly,
on the payment of dividends or the making of distributions by such Restricted
Subsidiary, directly or indirectly, to the Company, except that (A) subject to
the exclusion contained in clause (iv) below, the Company's equity in the net
income of any such Restricted Subsidiary for such period shall be included in
such Consolidated Net Income up to the aggregate amount of cash that could have
been distributed by such Restricted Subsidiary consistent with such restriction
during such period to the Company or another Restricted Subsidiary as a
dividend or other distribution (subject, in the case of a dividend or other
distribution paid to another Restricted Subsidiary, to the limitation contained
in this clause) and (B) the Company's equity in a net loss of any such
Restricted Subsidiary for such period shall be included in determining such
Consolidated Net Income; (iv) any gain (or loss) realized upon the sale or
other disposition of any assets of the Company or its consolidated Subsidiaries
(including pursuant to any sale-and-leaseback arrangement) which is not sold or
otherwise disposed of in the ordinary course of business and any gain (or loss)
realized upon the
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sale or other disposition of any Capital Stock of any Person; (v) extraordinary
gains or losses; and (vi) the cumulative effect of a change in accounting
principles. Notwithstanding the foregoing, for the purposes of Section 4.5
only, there shall be excluded from Consolidated Net Income any dividends,
repayments of loans or advances or other transfers of assets from Unrestricted
Subsidiaries to the Company or a Restricted Subsidiary to the extent such
dividends, repayments or transfers increase the amount of Restricted Payments
permitted under such Section pursuant to clause (a)(3)(D) thereof.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Company and its consolidated Subsidiaries, determined on a
consolidated basis in accordance with GAAP, as of the end of the most recent
fiscal quarter of the Company ending at least 45 days prior to the taking of
any action for the purpose of which the determination is being made, as (i) the
par or stated value of all outstanding Capital Stock of the Company plus (ii)
paid-in capital or capital surplus relating to such Capital Stock plus (iii)
any retained earnings or earned surplus less (A) any accumulated deficit and
(B) any amounts attributable to Disqualified Stock.
"Currency Agreement" means, with respect to any Person, any foreign
exchange contract, currency swap agreement or other similar agreement to which
such Person is a party or a beneficiary.
"CVC" means Citicorp Venture Capital, Ltd., a New York corporation.
"CVC Investor" means (i) CVC or any direct or indirect Wholly-Owned
Subsidiary of CVC, (ii) Citicorp, N.A. and (iii) any officer, employee or
director of CVC so long as such person shall be an employee, officer or
director of CVC or any direct or indirect Wholly-Owned Subsidiary of CVC.
"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"Depository" means The Depository Trust Company, its nominees and their
respective successors.
"Designated Senior Indebtedness" means (i) the Bank Indebtedness and (ii)
any other Senior Indebtedness of the Company which, at the date of
determination, has an aggregate principal amount outstanding of, or under
which, at the date of determination, the holders thereof are committed to lend
up to,
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at least $10 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
which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable) 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, at the option of the holder
thereof, for Indebtedness or Disqualified Stock or (iii) is redeemable at the
option of the holder thereof, in whole or in part, in each case on or prior to
the eleven month anniversary of the Stated Maturity of the Securities.
Disqualified Stock shall not include any Capital Stock that is not otherwise
Disqualified Stock if by its terms the holders have the right to require the
issuer to repurchase such stock (or such stock is mandatorily redeemable) upon
a Change of Control (or upon an event substantially similar to a Change of
Control).
"Domestic Restricted Subsidiary" means any Restricted Subsidiary of the
Company other than a Foreign Restricted Subsidiary.
"EBITDA" for any period means the sum of Consolidated Net Income plus,
without duplication, the following to the extent deducted in calculating such
Consolidated Net Income: (i) Consolidated Interest Expense, (ii) income tax
expense (including Michigan Single Business Tax expense), (iii) depreciation
expense, (iv) amortization expense and (v) all other non-cash items reducing
Consolidated Net Income (other than items that will require cash payments and
for which an accrual or reserve is, or is required by GAAP to be, made, other
than accruals for post-retirement benefits other than pensions), less all
non-cash items increasing Consolidated Net Income, in each case for such
period. Notwithstanding the foregoing, the provision for taxes based on the
income or profits of, and the depreciation and amortization of, a Subsidiary of
the Company shall be added to Consolidated Net Income to compute EBITDA only to
the extent (and in the same proportion) that the net income of such Subsidiary
was included in calculating Consolidated Net Income.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
18
-10-
"Existing Affiliate Agreements" means the Stockholders' Agreement, the
MSXI Registration Rights Agreement and any other existing agreement with
MascoTech or any of its Affiliates described on Schedule I hereof.
"Exchange Securities" means the 11 3/8% Senior Subordinated Notes due 2008
to be issued in exchange for the Initial Securities pursuant to the
Registration Agreement.
"Foreign Restricted Subsidiary" means any Restricted Subsidiary of the
Company which is not organized under the laws of the United States of America
or any State thereof or the District of Columbia.
"GAAP" means generally accepted accounting principles in the United States
of America as then in effect, including those set forth in (i) the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants, (ii) statements and pronouncements of the
Financial Accounting Standards Board and (iii) such other statements by such
other entity as approved by a significant segment of the accounting profession.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness or other obligation of any
Person and any 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 other obligation of such Person (whether
arising by virtue of partnership arrangements, or by agreements 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
the purpose 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 (x) endorsements for collection or deposit in the
ordinary course of business or (y) guarantees among Restricted Subsidiaries or
guarantees by the Company of Restricted Subsidiaries; provided that the
Indebtedness being guaranteed is permitted to be Incurred. The term
"Guarantee" used as a verb has a corresponding meaning. The term "Guarantor"
shall mean any Person Guaranteeing any obligation.
"Hedging Obligations" of any Person means the obligations of such Person
pursuant to any Interest Rate Agreement or Currency Agreement.
19
-11-
"Holder" or "Securityholder" means the Person in whose name a Security is
registered on the Registrar's books.
"Incur" means issue, assume, Guarantee, incur or otherwise become liable
for; provided, however, that any Indebtedness 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; provided, further, however, that in the case of a
discount security, neither the accrual of interest nor the accretion of
original issue discount shall be considered an Incurrence of Indebtedness, but
the entire face amount of such security shall be deemed Incurred upon the
issuance of such security. The term "Incurrence" when used as a noun shall
have a correlative meaning.
"Indebtedness" means, with respect to any Person on any date of
determination (without duplication), (i) the principal of and premium (if any)
in respect of (A) indebtedness of such Person for money borrowed and (B)
indebtedness evidenced by notes, debentures, bonds or other similar instruments
for the payment of which such Person is responsible or liable; (ii) all Capital
Lease Obligations of such Person and all Attributable Debt in respect of
Sale/Leaseback Transactions entered into by such Person; (iii) all obligations
of such Person issued or assumed as the deferred purchase price of property,
all conditional sale obligations of such Person, all obligations of such Person
under any title retention agreement, and any obligation to pay rent or other
payment amounts of such Person with respect to any Sale/Leaseback Transaction
(but excluding trade accounts payable arising in the ordinary course of
business), which purchase price or obligation is due more than six months after
the date of placing such property in service or taking delivery and title
thereto or the completion of such services (provided that, in the case of
obligations of an acquired Person assumed in connection with an acquisition of
such Person, such obligations would constitute Indebtedness of such Person);
(iv) all obligations of such Person for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction (other than
obligations with respect to letters of credit securing obligations (other than
obligations described in (i) through (iii) above) entered into in the ordinary
course of business of such Person to the extent such letters of credit are not
drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no
later than the tenth Business Day following receipt by such Person of a demand
for reimbursement following payment on the letter of credit); (v) the amount of
all obligations of such Person with
20
-12-
respect to the redemption, repayment or other repurchase of any Disqualified
Stock or, with respect to any Subsidiary of such Person, any Preferred Stock
(but excluding, in each case, any accrued dividends); (vi) all obligations of
the type referred to in clauses (i) through (v) of other Persons and all
dividends of other Persons for the payment of which, in either case, such
Person is responsible or liable, directly or indirectly, as obligor, guarantor
or otherwise, including by means of any Guarantee; (vii) all obligations of the
type referred to in clauses (i) through (vi) of other Persons secured by any
Lien on any property or asset of such Person (whether or not such obligation is
assumed by such Person), the amount of such obligation being deemed to be the
lesser of the value of such property or assets or the amount of the obligation
so secured; and (viii) to the extent not otherwise included in this definition,
Hedging Obligations of such Person. The amount of Indebtedness of any Person
at any date shall be the outstanding balance at such date of all unconditional
obligations as described above and the maximum liability, upon the occurrence
of the contingency giving rise to the obligation, of any contingent obligations
as described above at such date; provided, however, that the amount outstanding
at any time of any Indebtedness issued with original issue discount shall be
deemed to be the face amount of such Indebtedness less the remaining
unamortized portion of the original issue discount of such Indebtedness at such
time as determined in conformity with GAAP.
"Indenture" means this Indenture as amended or supplemented from time to
time by one or more supplemental indentures entered into pursuant to the
applicable provisions hereof or otherwise in accordance with the terms hereof.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or
(7) under the Securities Act.
"Initial Purchasers" means, collectively, Salomon Brothers Inc, Xxxxxx
Brothers Inc. and First Chicago Capital Markets, Inc.
"Initial Securities" means the 11 3/8% Senior Subordinated Notes due 2008
of the Company issued on the Issue Date for so long as such securities
constitute Restricted Securities.
"Interest Rate Agreement" means any interest rate swap agreement, interest
rate cap agreement or other financial
21
-13-
agreement or arrangement designed to protect the Company or any Restricted
Subsidiary against fluctuations in interest rates.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as accounts receivable on the balance sheet of such Person) or other
extensions of credit (including by way of Guarantee or similar arrangement) 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. For purposes of the definition of
"Unrestricted Subsidiary," the definition of "Restricted Payment" and Section
4.5 hereof, (i) "Investment" shall include the portion (proportionate to the
Company's equity interest in such Subsidiary) of the fair market value of the
net assets of any Subsidiary of the Company at the time that such Subsidiary is
designated an Unrestricted Subsidiary; provided, however, that upon a
redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall
be deemed to continue to have a permanent "Investment" in an Unrestricted
Subsidiary equal to an amount (if positive) equal to (x) the Company's
"Investment" in such Subsidiary at the time of such redesignation less (y) the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the fair market value of the net assets of such Subsidiary at the time of such
redesignation; and (ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of Directors.
"Issue Date" means the date on which the Securities are originally issued.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New York.
"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).
"Management Investors" means each of the officers, employees and directors
of the Company who own Voting Stock of the Company on the Issue Date, in each
case so long as such
22
-14-
person shall remain an officer, employee or director of the Company.
"MascoTech" means MascoTech, Inc., a Delaware corporation, and its
successors.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Available Cash" from an Asset Disposition means cash payments
received by the Company or any of its Subsidiaries therefrom (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 such
properties or assets or received in any other noncash form) in each case net of
(i) all legal, title and recording tax expenses, commissions and other fees and
expenses incurred, 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 which is
secured by any assets subject to such Asset Disposition, in accordance with the
terms of any Lien upon or other security agreement of any kind with respect to
such assets, or which 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 and (iv) the deduction of
appropriate amounts provided by the seller as a reserve, in accordance with
GAAP, against any liabilities associated with the property or other assets
disposed in such Asset Disposition and retained by the Company or any
Restricted Subsidiary after such Asset Disposition including without limitation
liabilities under any indemnification obligations associated with such Asset
Disposition.
"Net Cash Proceeds," with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys' fees,
accountants' fees, underwriters' or placement agents' fees, discounts or
commissions and brokerage, consultant and other fees actually incurred in
connection with such issuance or sale and net of taxes paid or payable as a
result thereof.
"Non-U.S. Person" means a person who is not a U.S. Person, as defined in
Regulation S.
23
-15-
"Obligations" means all present and future obligations for principal,
premium, interest (including, without limitation, any interest accruing
subsequent to the filing of a petition of bankruptcy at the rate provided for
in the documentation with respect thereto, whether or not such interest is an
allowed claim under applicable law), penalties, fees, indemnifications,
reimbursements (including, without limitation, all reimbursement and other
obligations pursuant to any letters of credit, bankers acceptances or similar
instruments or documents), damages and other liabilities payable under the
documentation at any time governing any indebtedness.
"Officer" means the Chief Executive Officer, the President, the Chief
Financial Officer or any Vice President of the Company.
"Officers' Certificate" means a certificate signed by two Officers of the
Company, at least one of whom shall be the principal financial officer of the
Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee; such counsel may be an employee of or
counsel to the Company or the Trustee. Each such opinion shall include, if
applicable, the statements provided for in Section 314(c) of the TIA.
"Other Qualified Securities" means any outstanding Senior Subordinated
Indebtedness of the Company issued pursuant to an indenture having a provision
substantially similar to the provision relating to Asset Dispositions contained
in Section 4.7 hereof.
"Permitted Holders" means the CVC Investors, MascoTech, the Management
Investors and their respective Permitted Transferees; provided, however, that
any Management Investor and any CVC Investor and any Permitted Transferee of a
Management Investor or CVC Investor (other than CVC or Citicorp, N.A. or any
direct or indirect Subsidiary of CVC or Citicorp, N.A. or any other Person
controlled by CVC or Citicorp, N.A.) shall not be a "Permitted Holder" if such
Person is the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, of Voting Stock that represents at least
30% of the aggregate voting power of all classes of the Voting Stock of the
Company, voting together as a single class (without giving effect to the
attribution of beneficial ownership as a result of any stockholders' agreement
as in effect on the Issue Date, and any amendment to such agreement
24
-16-
that does not materially change the allocation of voting power provided in such
agreement).
"Permitted Investment" means an Investment by the Company or any
Restricted Subsidiary in (i) the Company; (ii) a Restricted Subsidiary or a
Person that will, upon the making of such Investment, become a Restricted
Subsidiary; provided, however, that the primary business of such Restricted
Subsidiary is a Related Business; (iii) 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; provided, however, that such Person's primary business
is a Related Business; (iv) Temporary Cash Investments; (v) 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; (vi) payroll, travel and similar
advances to cover matters that are expected at the time of such advances
ultimately to be treated as expenses for accounting purposes and that are made
in the ordinary course of business; (vii) loans or advances to employees of the
Company or a Restricted Subsidiary in an aggregate amount not to exceed $1.5
million; (viii) stock, obligations or securities received in settlement of
debts created in the ordinary course of business and owing to the Company or
any Restricted Subsidiary or in satisfaction of judgments; (ix) Persons other
than Restricted Subsidiaries that are primarily engaged in a Related Business
or property or assets to be used primarily in a Related Business, in an
aggregate amount not to exceed $20.0 million (to the extent utilized for an
Investment, such amount will be reinstated to the extent that the Company or
any Restricted Subsidiary receives dividends, repayments of loans or other
transfers of assets as a return of such Investment); provided, however, that at
the time of any Investment pursuant to this clause (ix), the Company and its
Restricted Subsidiaries would be able to Incur an additional $1.00 of
Indebtedness pursuant to paragraph (a) of Section 4.3 hereof; and (x) any
Person to the extent such Investment represents the non-cash portion of the
consideration received for an Asset Disposition as permitted under Section 4.7
hereof.
"Permitted Investors" means (i) MascoTech and its Permitted Transferees,
(ii) the CVC Investors and (iii) the Management Investors and their Permitted
Transferees; provided that the Management Investors and their Permitted
Transferees
25
-17-
do not in the aggregate beneficially own more than 30% of the aggregate voting
power of the Voting Stock of the Company (without giving effect to any
attribution of beneficial ownership which may result from the Stockholders'
Agreement, and any amendment to such agreement that does not materially change
the allocation of voting power provided for in such agreement).
"Permitted Lien" means (a) Liens on property of a Person existing at the
time such Person is merged into or consolidated with the Company or any
Restricted Subsidiary; provided that such Liens were not created in
anticipation of such Person being so merged or consolidated; and (b) Liens to
secure any Refinancing Indebtedness; provided such Liens cover only such
property which are the subject of a lien securing the Indebtedness being
Refinanced.
"Permitted Transferee" means (a) with respect to any CVC Investor who is
an employee, officer or director of CVC or any Wholly-Owned Subsidiary of CVC,
any spouse or lineal descendant (including by adoption) of such CVC Investor so
long as such CVC Investor shall be an employee, officer or director of CVC; (b)
with respect to MascoTech, any direct or indirect Subsidiary or any other
Person controlled by MascoTech; and (c) with respect to any Management
Investor, any spouse or lineal descendant (including by adoption) of such
Management Investor so long as such Management Investor shall be an employee,
officer or director of the Company.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock 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) which 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.
"principal" of a Security means the principal of the Security plus the
premium, if any, payable on the Security which is due or overdue or is to
become due at the relevant time.
26
-18-
"Private Placement Legend" means the legend initially set forth on the
securities in the form set forth in Section 2.13.
"Public Equity Offering" means an underwritten primary public offering of
common stock of the Company pursuant to an effective registration statement
under the Securities Act.
"Public Market" means any time after (i) a Public Equity Offering has been
consummated and (ii) at least 10% of the total issued and outstanding common
stock of the Company has been distributed by means of an effective registration
statement under the Securities Act or sales pursuant to Rule 144 under the
Securities Act.
"Purchase Money Indebtedness" means Indebtedness (i) consisting of the
deferred purchase price of property, conditional sale obligations, obligations
under any title retention agreement, other purchase money obligations and
obligations in respect of industrial revenue bonds or similar Indebtedness, in
each case where the maturity of such Indebtedness does not exceed the
anticipated useful life of the asset being financed, and (ii) Incurred to
finance the acquisition by the Company or a Restricted Subsidiary of such
asset, including additions and improvements; provided, however, that any Lien
arising in connection with any such Indebtedness shall be limited to the
specified asset being financed or, in the case of real property or fixtures,
including additions and improvements, the real property on which such asset is
attached; and provided, further, however, that such Indebtedness is Incurred
within 180 days after such acquisition of such asset by the Company or
Restricted Subsidiary.
"Qualified Finance Subsidiary" means a Subsidiary of the Company
constituting a "finance subsidiary" within the meaning of Rule 3a-5 under the
Investment Company Act of 1940, as amended (the "1940 Act"), or an issuer of
asset-backed securities within the meaning of Rule 3a-7 of the 1940 Act or any
other vehicle under a similar exemption, formed for the purpose of engaging in
a Qualified TIPS Transaction and having no assets other than those necessary to
consummate the Qualified TIPS Transaction.
"Qualified Institutional Buyer" or "QIB" shall have the meaning specified
in Rule 144A under the Securities Act.
"Qualified TIPS Transaction" means an issuance by a Qualified Finance
Subsidiary of preferred trust securities or
27
-19-
similar securities in respect of which any dividends, liquidation preference or
other obligations under such securities are Guaranteed by the Company to the
extent required by the 1940 Act, as amended, or customary for transactions of
such type.
"Refinance" means, in respect of any Indebtedness, to refinance, extend,
renew, refund, repay, prepay, redeem, defease or retire, or to issue other
Indebtedness in exchange or replacement for, such Indebtedness. "Refinanced"
and "Refinancing" shall have correlative meanings.
"Refinancing Indebtedness" means Indebtedness that Refinances any
Indebtedness of the Company or any Restricted Subsidiary existing on the Issue
Date or Incurred in compliance with this Indenture; provided, however, that (i)
such Refinancing Indebtedness has a Stated Maturity no earlier than the Stated
Maturity of the Indebtedness being Refinanced, (ii) such 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 has an aggregate
principal amount (or if Incurred with original issue discount, an aggregate
issue price) that is equal to or less than the aggregate principal amount (or
if Incurred with original issue discount, the aggregate accreted value) then
outstanding or committed (plus fees and expenses, including any premium and
defeasance costs) under the Indebtedness being Refinanced; provided, further,
however, that Refinancing Indebtedness shall not include Indebtedness of the
Company or a Restricted Subsidiary that Refinances Indebtedness of an
Unrestricted Subsidiary.
"Registration Agreement" means the Registration Agreement dated the Issue
Date by and among the Company, the Subsidiary Guarantors and the Initial
Purchasers, as amended from to time.
"Regulation S" means Regulation S under the Securities Act.
"Related Business" means any business related, ancillary or complementary
(as determined in good faith by the Board of Directors) to the businesses of
the Company and the Restricted Subsidiaries on the Issue Date.
"Representative" means any trustee, agent or representative (if any) for
an issue of Senior Indebtedness of the Company.
28
-20-
"Responsible Officer" means, when used with respect to the Trustee, any
officer assigned to the Corporate Trust Office, including any vice president,
assistant vice president, assistant secretary or any other officer of the
Trustee to whom any corporate trust matter is referred because of his or her
knowledge or familiarity with the particular subject.
"Restricted Payment" means, with respect to any Person, (i) the
declaration or payment of any dividends or any other distributions on or in
respect of its Capital Stock (including any such payment in connection with any
merger or consolidation involving such Person) or similar payment to the
holders of its Capital Stock, except dividends or distributions payable solely
in its Capital Stock (other than Disqualified Stock) and except dividends or
distributions payable solely to the Company or a Restricted Subsidiary (and, if
such Restricted Subsidiary is not wholly owned, to its other shareholders on a
pro rata basis or on a basis that results in the receipt by the Company or a
Restricted Subsidiary of dividends or distributions of greater value than it
would receive on a pro rata basis), (ii) the purchase, redemption or other
acquisition or retirement for value of any Capital Stock of the Company held by
any Person or of any Capital Stock of a Restricted Subsidiary held by any
Affiliate of the Company (other than a Restricted Subsidiary), including the
exercise of any option to exchange any Capital Stock (other than into Capital
Stock of the Company that is not Disqualified Stock), (iii) the purchase,
repurchase, redemption, defeasance or other acquisition or retirement for
value, prior to scheduled maturity, scheduled repayment or scheduled sinking
fund payment of any Subordinated Obligations (other than the purchase,
repurchase or other acquisition of Subordinated Obligations purchased 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) the making of any Investment in any Person (other than a Permitted
Investment).
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act; provided, however, that the Trustee shall
be entitled to request and conclusively rely on an Opinion of Counsel with
respect to whether any Security constitutes a Restricted Security.
"Restricted Subsidiary" means any Subsidiary of the Company that is not an
Unrestricted Subsidiary.
"Rule 144A" means Rule 144A under the Securities Act.
29
-21-
"Sale/Leaseback Transaction" means an arrangement relating to property now
owned or hereafter acquired whereby the Company or a Restricted Subsidiary
transfers such property to a Person and the Company or a Restricted Subsidiary
leases it from such Person and such lease is reflected on such Person's balance
sheet as a Capital Lease Obligation.
"SEC" means the Securities and Exchange Commission.
"Secured Indebtedness" means any Indebtedness of the Company secured by a
Lien. "Secured Indebtedness" of any Subsidiary Guarantor has a correlative
meaning.
"Securities" shall mean, collectively, the Initial Securities, the
Exchange Securities and the Subsequent Securities, and any other Securities
authenticated and delivered under this Indenture, which should be treated as a
single class of securities, as amended or supplemented from time to time in
accordance with the terms of this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"Senior Credit Facility" means the Credit Agreement dated as of January
22, 1998, in effect on the Issue Date, by and among the Company, as borrower,
and guarantor, and certain subsidiaries, as borrowing subsidiaries, the Lenders
referred to therein and NBD Bank, as agent, as the same may be amended,
extended, renewed, restated, supplemented or otherwise modified (in each case,
in whole or in part, and without limitation as to amount, terms, conditions,
covenants and other provisions) from time to time, and any agreement governing
Indebtedness Incurred to refund, replace or refinance any borrowings and
commitments then outstanding or permitted to be outstanding under such Senior
Credit Facility or any such prior agreement as the same may be amended,
extended, renewed, restated, supplemented or otherwise modified (in each case,
in whole or in part, and without limitation as to amount, terms, conditions,
covenants and other provisions). The term "Senior Credit Facility" shall
include all related or ancillary documents executed at any time, including,
without limitation, any instruments, guarantee agreements and security
documents.
"Senior Indebtedness" of the Company means (i) Indebtedness of the Company
and all Bank Indebtedness, whether outstanding on the Issue Date or thereafter
Incurred and (ii) accrued and unpaid interest (including interest accruing on
or
30
-22-
after the filing of any petition in bankruptcy or for reorganization relating
to the Company whether or not a claim for post-filing interest is allowed in
such proceeding) in respect of (A) indebtedness of the Company for money
borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other
similar instruments for the payment of which the Company is responsible or
liable unless, in the instrument creating or evidencing the same or pursuant to
which the same is outstanding, it is provided that such obligations are
subordinate in right of payment to the Securities; provided, however, that
Senior Indebtedness shall not include (1) any obligation of the Company to any
Subsidiary, (2) any liability for Federal, state, local or other taxes owed or
owing by the Company, (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), (4) any Indebtedness of
the Company (and any accrued and unpaid interest in respect thereof) which is
subordinate or junior in any respect (other than as a result of the
Indebtedness being unsecured) to any other Indebtedness or other obligation of
the Company, including any Senior Subordinated Indebtedness and any
Subordinated Obligations, (5) any obligations with respect to any Capital Stock
or (6) that portion of any Indebtedness which at the time of Incurrence is
Incurred in violation of this Indenture. "Senior Indebtedness" of any
Subsidiary Guarantor has a correlative meaning.
"Senior Subordinated Indebtedness" of the Company means the Securities and
any other Indebtedness of the Company that specifically provides that such
Indebtedness is to rank pari passu with the Securities in right of payment and
is not subordinated by its terms in right of payment to any Indebtedness or
other obligation of the Company which is not Senior Indebtedness. "Senior
Subordinated Indebtedness" of any Subsidiary Guarantor has a correlative
meaning.
"Significant Subsidiary" means any Restricted Subsidiary that would be a
"Significant Subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the SEC.
"Stated Maturity" means, with respect to any security, the date specified
in such security as the fixed date on which the final 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
31
-23-
the happening of any contingency unless such contingency has occurred).
"Stockholders' Agreement" means the stockholders' agreement dated January
3, 1997 by and among the Company, MascoTech, CVC and certain executive officers
and directors of the Company, as amended from time to time.
"Subordinated Obligation" means any Indebtedness of the Company (whether
outstanding on the Issue Date or thereafter Incurred) which is subordinate or
junior in right of payment to the Securities pursuant to a written agreement to
that effect. "Subordinated Obligation" of any Subsidiary Guarantor has a
correlative meaning.
"Subsidiary" means, in respect of any Person, any corporation,
association, partnership, business trust or other business entity of which more
than 50% of the total voting power of shares of Capital Stock or other
interests (including partnership interests or trust 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, (ii) such Person and one or more
Subsidiaries of such Person or (iii) one or more Subsidiaries of such Person.
"Subsidiary Guarantee" means the Guarantee by a Subsidiary Guarantor of
the Company's obligations with respect to the Securities.
"Subsidiary Guarantor" means each Subsidiary designated as such on the
signature pages of this Indenture and any other Subsidiary that has issued a
Subsidiary Guarantee.
"S&P" means Standard and Poor's Ratings Service.
"Temporary Cash Investments" means any of the following: (i) any
investment in direct obligations of the United States of America or any agency
thereof or obligations Guaranteed by the United States of America or any agency
thereof, (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 which is organized under the laws of
the United States of America, any state thereof or any foreign country
recognized by the United States, and which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $250,000,000 (or the
foreign currency equivalent thereof) and
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has outstanding debt which is rated "A" (or a similar equivalent rating) or
higher by at least one nationally recognized statistical rating organization
(as defined in Rule 436 under the Securities Act) or any money-market fund
sponsored by a registered broker dealer or mutual fund distributor, (iii)
repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clause (i) above entered into with a bank
meeting the qualifications described in clause (ii) above, (iv) investments in
commercial paper, maturing not more than 90 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, any state thereof
or the District of Columbia 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 Xxxxx'x or "A-1" (or higher)
according to S&P and (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 Xxxxx'x.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections 1
77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in
Section 9.3.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means such successor including but not
limited to any corporation resulting from or surviving any such consolidation
or merger to which any of its successors may be a party as provided in Section
7.9.
"Trust Officer" means the Chairman of the Board, the President or any
other officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Uniform Commercial Code" means the New York Uniform Commercial Code as in
effect from time to time.
"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 in Section 4.11 and (ii) any
Subsidiary of an Unrestricted Subsidiary.
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"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 at the issuer's option.
"Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof.
"Wholly-Owned Subsidiary" means a Restricted Subsidiary all the Capital
Stock of which (other than directors' qualifying shares) is owned by the
Company and/or one or more Wholly-Owned Subsidiaries.
SECTION 1.2. Other Definitions.
Term Defined in Section
---- ------------------
"Affiliate Transaction" 4.8
"Agent Members" 2.6
"Bankruptcy Law" 6.1
"Blockage Notice" 10.3(c)
"covenant defeasance option" 8.1(b)
"Custodian" 6.1
"defeasance trust" 8.2
"Event of Default" 6.1
"Excess Proceeds" 4.7(a)
"Excess Proceeds Offer" 4.7(a)
"Excess Proceeds Offer Amount" 4.7(c)
"Excess Proceeds Offer Period" 4.7(c)
"Excess Proceeds Payment" 4.7(a)
"Global Securities" 2.1(b)
"Guaranteed Obligations" 11.1
"legal defeasance option" 8.1(b)
"Notice of Default" 6.1
"Participants" 2.6
"pay the Subordinated Debt" 10.3(a)
"Paying Agent" 2.3
"Payment Blockage Period" 10.3(c)
"Physical Securities" 2.1
"Private Placement Legend" 2.13
"Purchase Date" 4.7(b)
"Registrar" 2.3
"Securities Register" 2.3
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Term Defined in Section
---- ------------------
"Subsequent Securities" 2.2
"Successor Company" 5.1
SECTION 1.3. Incorporation by Reference of Trust Indenture Act. This
Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the Securities means the Company and any other obligor on the
indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.4. Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the plural
include the singular;
(6) the principal amount of any non-interest-bearing or other
discount security at any date shall be the principal amount thereof that
would be shown on a balance
35
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sheet of the Company dated such date prepared in accordance with GAAP;
(7) all references to $, US$, dollars or United States dollars shall
refer to the lawful currency of the United States; and
(8) "herein," "hereof" and other words of similar import refer to
this Indenture as a whole and not to any particular Article, Section or
other subdivision.
ARTICLE 2
THE SECURITIES
SECTION 2.1. Form and Dating.
(a) The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit A, which is hereby incorporated in and
expressly made a part of this Indenture. The Exchange Securities and the
Trustee's certificate of authentication relating thereto shall be substantially
in the form of Exhibit B hereto. The Securities may have notations, legends or
endorsements required by law, stock exchange rules, agreements to which the
Company is subject, if any, or usage (provided that any such notation, legend
or endorsement is in a form acceptable to the Company). Each Security shall be
dated the date of its authentication. If required, the Securities may bear the
appropriate legend regarding any original issue discount for federal income tax
purposes. Each Security shall have attached to it an executed Guarantee
substantially in the form of Exhibit E, from each of the Subsidiary Guarantors.
The terms and provisions contained in the Securities, annexed hereto as
Exhibits A and B, shall constitute, and are hereby expressly made, a part of
this Indenture and, to the extent applicable, the Company, the Subsidiary
Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.
(b) Global Securities. The Securities offered and sold in reliance on
Rule 144A and Securities offered and sold in reliance on Regulation S shall be
issued initially in the form of one or more permanent Global Securities
("Global Securities") in definitive, fully registered form without interest
coupons, in substantially the form of Exhibit A, which shall be
36
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deposited on behalf of the purchasers of the Securities represented thereby
with the Trustee, at the Trustee's office in New York City, as custodian for
the Depository, and registered in the name of the Depository or a nominee of
the Depository, duly executed by the Company (and having an executed Guarantee
endorsed thereon) and authenticated by the Trustee as hereinafter provided and
shall bear the legend set forth in Section 2.13. The aggregate principal
amount of the Global Securities may from time to time be increased or decreased
by adjustments made on the records of the Trustee and the Depository or its
nominee in the limited circumstances hereinafter provided.
Securities issued in exchange for interests in Global Securities pursuant
to Section 2.6 may be issued in the form of permanent certificated Securities
in registered form in substantially the form set forth in Exhibit A (the
"Physical Securities"). All Securities offered and sold in reliance on
Regulation S shall remain in the form of a Global Security until the
consummation of the Exchange Offer pursuant to the Registration Agreement;
provided, however, that all of the time periods specified in the Registration
Agreement to be complied with by the Company have been so complied with.
SECTION 2.2. Execution and Authentication. An Officer of the Company and
each Subsidiary Guarantor shall sign the Securities for the Company and the
Guarantees for the Subsidiary Guarantors by manual or facsimile signature. If
an Officer whose signature is on a Security no longer holds that office at the
time the Trustee authenticates the Security, the Security shall be valid
nevertheless. A Security shall not be valid until an authorized signatory of
the Trustee manually signs the certificate of authentication on the Security.
The signature shall be conclusive evidence that the Security has been
authenticated under this Indenture. The aggregate principal amount of
Securities outstanding at any time may not exceed $130,000,000 (except as
provided in Section 2.7) of which $100,000,000 in aggregate principal amount is
being offered on (i) the Issue Date and (ii) one or more additional series of
Securities (the "Subsequent Securities") in an aggregate principal amount not
to exceed $30 million may be issued from time to time in the future. The
Trustee shall authenticate and make available for delivery (i) Initial
Securities for original issue in an aggregate principal amount of $100,000,000,
(ii) Exchange Securities from time to time for issue only in exchange for a
like principal amount of Initial Securities and (iii) Subsequent Securities, in
each case, upon a written order of the Company signed by an Officer of the
Company. Such order shall specify the amount of the Securities or Subsequent
Secu-
37
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rities to be authenticated and the date on which the Securities are to be
authenticated. All Securities issued on the Issue Date and Subsequent
Securities shall be identical in all respects other than the issue date and the
date from which interest accrues, except as provided in this Section 2.2. The
Trustee may appoint an authenticating agent acceptable to the Company to
authenticate the Securities, upon the consent of the Company to such
appointment. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Securities whenever the Trustee may do so
upon a written order of the Company in the form of an Officers' Certificate.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as
any Registrar, Paying Agent or agent for service of notices and demands.
In the event the Company shall issue and the Trustee shall authenticate
any Subsequent Securities, the Company shall use its best efforts to obtain the
same "CUSIP" number for such Subsequent Securities as is printed on the
Securities outstanding at such time; provided however, that if any such
Subsequent Securities issued under this Indenture are determined, pursuant to
an Opinion of Counsel of the Company in a form reasonably satisfactory to the
Trustee, to be a different class of Security than the Securities outstanding
for Federal income tax purposes, the Company may obtain a "CUSIP" number for
such Subsequent Securities that is different from the "CUSIP" number printed on
the Securities then outstanding. Notwithstanding the foregoing, all Securities
and Subsequent Securities issued under this Indenture shall vote and consent
together on all matters as one class and neither the Securities nor Subsequent
Securities will have the right to vote or consent as a separate class on any
matter.
SECTION 2.3. Registrar and Paying Agent. The Company shall maintain an
office or agency where Securities may be presented for registration of transfer
or for exchange (the "Registrar") and an office or agency where Securities may
be presented for payment (the "Paying Agent"). The Registrar, acting on behalf
of and as agent for the Company, shall keep a register (the "Securities
Register") of the Securities and of their transfer and exchange. The Company
may have one or more co-registrars and one or more additional paying agents.
The term "Paying Agent" includes any additional paying agent. The Company
shall enter into an appropriate agency agreement with any Registrar, Paying
Agent or co-registrar not a party to this Indenture, which shall incorporate
the terms of
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the TIA. The agreement shall implement the provisions of this Indenture that
relate to such agent. The Company shall promptly notify the Trustee of the
name and address of any such agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation and indemnification therefor pursuant to Section
7.7. The Company may act as Paying Agent, Registrar, co-Registrar or transfer
agent.
The Company initially appoints the Trustee as Registrar and Paying Agent
in connection with the Securities, until such time as the Trustee has resigned
or a successor has been appointed pursuant to Section 7.8. Any of the
Registrar, the Paying Agent or any other agent may resign upon 30 days' notice
to the Company.
SECTION 2.4. Paying Agent To Hold Money in Trust. On or prior to each
due date of the principal and interest on any Security, the Company shall
deposit with the Paying Agent a sum sufficient to pay such principal and
interest when so becoming due. The Company shall require each Paying Agent
(other than the Trustee) to agree in writing that the Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all sums held by the
Paying Agent for the payment of principal of or interest on the Securities and
shall notify the Trustee of any default by the Company or any other obligor in
making any such payment. If the Company or a Subsidiary acts as Paying Agent,
it shall segregate the money held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee and to account for any funds disbursed by
the Paying Agent. Upon complying with this Section, the Paying Agent shall
have no further liability for the money delivered to the Trustee.
SECTION 2.5. Securityholder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to
it of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee, in writing at least five
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, all information in the possession or control of
the Company as to the names and addresses of Securityholders; provided that as
long as the Trustee is the Registrar, no such list need be furnished.
39
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SECTION 2.6. Transfer and Exchange. The Securities shall be issued in
registered form and shall be transferable only upon the surrender of a Security
for registration of transfer. When a Security is presented to the Registrar or
a co-registrar with a request to register a transfer, the Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Registrar shall record in the
Securities Register the transfer as requested if the requirements of Section
8-401(1) of the Uniform Commercial Code are met, and thereupon one or more new
Securities in the same aggregate principal amount shall be issued to the
designated assignee or transferee and the old Security will be returned to the
Company. When Securities are presented to the Registrar or a co-registrar with
a request to exchange them for an equal principal amount of Securities of other
denominations, the Registrar shall make the exchange as requested, in the same
manner, if the same requirements are met. To permit registration of transfers
and exchanges, the Company shall execute and the Trustee shall authenticate
Securities and each of the Subsidiary Guarantors shall execute a Guarantee
thereon at the Registrar's or co-registrar's request. The Company may require
payment of a sum sufficient to pay all taxes, assessments or other governmental
charges in connection with any transfer or exchange pursuant to this Section.
The Company shall not be required to make and the Registrar need not register
transfers or exchanges of Securities selected for redemption (except, in the
case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or any Securities for a period of 15 days before a selection of
Securities to be redeemed or 15 days before an interest payment date.
Prior to the due presentation for registration of transfer of any
Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of principal of and interest on such Security and for all other
purposes whatsoever, whether or not such Security is overdue, and none of the
Company, the Trustee, the Paying Agent, the Registrar or any co-registrar shall
be affected by notice to the contrary.
All Securities issued upon any transfer or exchange pursuant to the terms
of this Indenture will evidence the same debt and will be entitled to the same
benefits under this Indenture as the Securities surrendered upon such transfer
or exchange.
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With respect to Global Securities:
(1) Each Global Security authenticated under this Indenture shall (i) be
registered in the name of the Depository designated for such Global Security or
a nominee thereof, (ii) be deposited with such Depository or a nominee thereof
or custodian therefor, (iii) bear legends as set forth in Section 2.13 and (iv)
constitute a single Security for all purposes of this Indenture.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depository, or the Trustee as its custodian, or under the
Global Securities, and the Depository may be treated by the Company, the
Trustee and any Agent of the Company or the Trustee as the absolute owner of
such Global Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any Agent
of the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depository or impair, as between
the Depository and its Agent Members, the operation of customary practices
governing the exercise of the rights of a Holder of any Security.
(2) Transfers of a Global Security shall be limited to transfers in whole
but not in part to the Depository, its successors or their respective nominees.
Interests of beneficial owners in a Global Security may be transferred or
exchanged for Physical Securities in accordance with the rules and procedures
of the Depository and the provisions of Section 2.14. In addition, a Global
Security is exchangeable for certificated Securities if (i) the Depository
notifies the Company that it is unwilling or unable to continue as a Depository
for such Global Security or if at any time the Depository ceases to be a
clearing agency registered under the Exchange Act,(ii) the Company executes and
delivers to the Trustee a notice that such Global Security shall be so
transferable, registrable, and exchangeable, and such transfers shall be
registrable or (iii) there shall have occurred and be continuing an Event of
Default or an event which, with the giving of notice or lapse of time or both,
would constitute an Event of Default with respect to the Securities represented
by such Global Security. Any Global Security that is exchangeable for
certificated Securities pursuant to the preceding sentence will be transferred
to, and registered and exchanged for, certificated Securities in authorized
denominations, without legends applicable to a Global Security, and registered
in such names as the Depository
41
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holding such Global Security may direct. Subject to the foregoing, a Global
Security is not exchangeable, except for a Global Security of like denomination
to be registered in the name of the Depository or its nominee. In the event
that a Global Security becomes exchangeable for certificated Securities, (i)
certificated Securities will be issued only in fully registered form in
denominations of $1,000 or integral multiples thereof, (ii) payment of
principal, any repurchase price, and interest on the certificated Securities
will be payable, and the transfer of the certificated Securities will be
registrable, at the office or agency of the Company maintained for such
purposes, and (iii) no service charge will be made for any registration or
transfer or exchange of the certificated Securities, although the Company may
require payment of a sum sufficient to cover any tax or governmental charge
imposed in connection therewith.
(3) Securities issued in exchange for a Global Security or any portion
thereof shall have an aggregate principal amount equal to that of such Global
Security or portion thereof to be so exchanged, shall be registered in such
names and be in such authorized denominations as the Depository shall designate
and shall bear the applicable legends provided for herein. Any Global Security
to be exchanged in whole shall be surrendered by the Depository to the Trustee.
With respect to any Global Security to be exchanged in part, either such
Global Security shall be so surrendered for exchange or, if the Trustee is
acting as custodian for the Depository or its nominee with respect to such
Global Security, the principal amount thereof shall be reduced, by an amount
equal to the portion thereof to be so exchanged, by means of an appropriate
adjustment made on the records of the Trustee. Upon any such surrender or
adjustment, the Trustee shall authenticate and deliver the Security issuable on
such exchange to or upon the order of the Depository or an authorized
representative thereof.
(4) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Section 2.6, Section 2.7, 2.9, 2.14 or
otherwise, shall be authenticated and delivered in the form of, and shall be, a
Global Security, unless such Security is registered in the name of a Person
other than the Depository for such Global Security or a nominee thereof.
Members of, or participants in, the Depository ("Participants") shall have no
rights under this Indenture with respect to any Global Security held on their
behalf by the Depository or by the Trustee as the custodian of the Depository
or under such Global Security, and the Deposi-
42
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tory may be treated by the Company, the Trustee and any agent of the Company or
the Trustee as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depository or impair, as between the Depository and its Participants, the
operation of customary practices of such Depository governing the exercise of
the rights of a holder of a beneficial interest in any Global Security.
SECTION 2.7. Replacement Securities. If a mutilated Security is
surrendered to the Trustee or Registrar or if the Holder of a Security claims
that the Security has been lost, destroyed or wrongfully taken, the Company
shall issue and the Trustee shall authenticate a replacement Security and the
Subsidiary Guarantors shall execute a Guarantee thereon if the requirements of
Section 8-405 of the Uniform Commercial Code are met and the Holder satisfies
any other reasonable requirements of the Trustee and the Company. Such Holder
shall furnish an indemnity bond sufficient in the judgment of the Company, the
Subsidiary Guarantors and the Trustee to protect the Company, the Subsidiary
Guarantors, the Trustee, the Paying Agent, the Registrar and any co-registrar
from any loss, liability, cost or expense which any of them may suffer if a
Security is replaced. The Company and the Trustee may charge the Holder for
their expenses in replacing a Security.
Every replacement Security issued pursuant to the terms of this Section
shall constitute an additional obligation of the Company and the Subsidiary
Guarantors under this Indenture.
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 2.8. Outstanding Securities. Securities outstanding at any time
are all Securities authenticated by the Trustee except for those canceled by
it, those delivered to it for cancellation and those described in this Section
as not outstanding. Subject to the provisions of Section 13.6, a Security does
not cease to be outstanding because the Company or an Affiliate of the Company
holds the security.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee and the Company re-
43
-35-
ceive proof satisfactory to them that the replaced Security is held by a bona
fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance with this
Indenture, on a redemption date or maturity date or, pursuant to Section
8.1(a), within 91 days prior thereto, money sufficient to pay all principal and
interest payable on that redemption or maturity date with respect to the
Securities (or portions thereof) to be redeemed or maturing, as the case may
be, then on and after such date such Securities (or portions thereof) cease to
be outstanding and on and after such redemption or maturity date interest on
them ceases to accrue.
SECTION 2.9. Temporary Securities. Until definitive Securities are ready
for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form
of definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate definitive Securities and
deliver them in exchange for temporary securities.
SECTION 2.10. Cancellation. The Company at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for
registration of transfer, exchange or payment. The Trustee and no one else
shall cancel all Securities surrendered for registration of transfer, exchange,
payment or cancellation and deliver such canceled Securities to the Company.
The Trustee shall from time to time provide the Company a list of all
Securities that have been canceled as requested by the Company. The Company
may not issue new Securities to replace Securities it has redeemed, paid or
delivered to the Trustee for cancellation.
SECTION 2.11. Defaulted Interest. If the Company defaults in a payment
of interest on the Securities, the Company shall pay defaulted interest (plus
interest on such defaulted interest to the extent lawful) in any lawful manner
in accordance with Section 4.1. The Company may pay the defaulted interest to
the persons who are Securityholders on a subsequent special record date. The
Company shall fix or cause to be fixed any such special record date and payment
date to the reasonable satisfaction of the Trustee and shall promptly mail to
each Securityholder a notice that states the special record
44
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date, the payment date and the amount of defaulted interest to be paid.
SECTION 2.12. CUSIP Numbers. The Company in issuing the Securities may
use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to
the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the CUSIP
numbers.
SECTION 2.13. Restrictive Legends. Each Global Security and Physical
Security that constitutes a Restricted Security or is sold in compliance with
Regulation S shall bear the following legend (the "Private Placement Legend")
on the face thereof until after the second anniversary of the later of the
Issue Date and the last date on which the Company or any Affiliate of the
Company was the owner of such Security (or any predecessor security) (or such
shorter period of time as permitted by Rule 144(k) under the Securities Act or
any successor provision thereunder) (or such longer period of time as may be
required under the Securities Act or applicable state securities laws in the
opinion of counsel for the Company, unless otherwise agreed by the Company and
the Holder thereof):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY
OF THE ISSUANCE HEREOF (OR A PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER
THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF
THIS SECURITY), (3) IN AN
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OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT
(AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF
TRANSFER ON THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER IS BEING
EFFECTED BY CERTAIN TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED BELOW)
PRIOR TO THE EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING
OF RULE 903(c)(3) OF REGULATION S UNDER THE SECURITIES ACT), A CERTIFICATE
WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED BY THE
TRANSFEREE TO THE COMPANY AND THE TRUSTEE, (4) TO AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2) (3) OR (7) UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING
THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A
CERTIFICATE IN THE FORM ATTACHED TO THIS SECURITY IS DELIVERED BY THE
TRANSFEREE TO THE COMPANY AND THE TRUSTEE (PROVIDED THAT CERTAIN HOLDERS
SPECIFIED IN THE INDENTURE MAY NOT TRANSFER THIS SECURITY PURSUANT TO THIS
CLAUSE (4) PRIOR TO THE EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN
THE MEANING OF RULE 903(c)(3) OF REGULATION S UNDER THE SECURITIES ACT)), (5)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, OR (6) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. AN INSTITUTIONAL ACCREDITED INVESTOR HOLDING THIS SECURITY AGREES IT
WILL FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES, LEGAL OPINIONS
AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY
TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE
HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE
BENEFIT OF THE COMPANY THAT (1) IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) IT IS AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY
FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) IT IS A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF PARAGRAPH (o)(2) OR RULE 902 UNDER) REGULATION
S UNDER THE SECURITIES ACT.
Each Global Security shall also bear the following legend on the face
thereof:
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE
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TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY, OR BY ANY SUCH NOMINEE OF THE DEPOSITORY, OR BY THE DEPOSITORY OR
NOMINEE OF SUCH SUCCESSOR DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR
DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY. UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION ("DTC"), TO AN ISSUER 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 NAME 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 DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE 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 NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.14 OF THE INDENTURE.
SECTION 2.14. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited Investors and Non-U.S.
Persons. The following provisions shall apply with respect to the registration
of any proposed transfer of a Security constituting a Restricted Security to
any Institutional Accredited Investor which is not a QIB or to any Non-U.S.
Person:
(i) the Registrar shall register the transfer of any Security
constituting a Restricted Security whether or not such Security bears the
Private Placement Legend, if (x) the requested transfer is after the
second anniversary of the Issue Date (provided, however, that neither the
Company nor any Affiliate of the Company has held any beneficial interest
in such Security, or portion thereof, at any time on or prior to the
second anniversary of the Issue Date) or (y) (1) in the case of a
transfer to an Institutional Accredited Investor which is not a QIB
(excluding Non-U.S. Persons), the proposed transferee has delivered to
the Registrar a certificate substantially in the form of Exhibit C hereto
and any legal opinions and certifications required thereby or (2) in the
case of a transfer to a Non-U.S. Person, the proposed transferor has
delivered
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to the Registrar a certificate substantially in the form of Exhibit D
hereto; and
(ii) if the proposed transferor is an Agent Member holding a
beneficial interest in the Global Security, upon receipt by the Registrar
of (x) the certificate, if any, required by paragraph (i) above and (y)
written instructions given in accordance with the Depository's and the
Registrar's procedures,
whereupon (a) the Registrar shall reflect on its books and records the date and
(if the transfer does not involve a transfer of outstanding Physical
Securities) a decrease in the principal amount of such Global Security in an
amount equal to the principal amount of the beneficial interest in the Global
Security to be transferred, and (b) the Company shall execute, the Subsidiary
Guarantors shall execute the Guarantees on, and the Trustee shall authenticate
and deliver, one or more Physical Securities of like tenor and amount.
(b) Transfers to QIBs. The following provisions shall apply with
respect to the registration of any proposed transfer of a Security constituting
a Restricted Security to a QIB (excluding transfers to Non-U.S. Persons):
(i) the Registrar shall register the transfer if such transfer is
being made by a proposed transferor who has checked the box provided for
on the form of Security stating, or has otherwise advised the Company and
the Registrar in writing, that the sale has been made in compliance with
the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Security stating, or has
otherwise advised the Company and the Registrar in writing, that it is
purchasing the Security for its own account or an account with respect to
which it exercises sole investment discretion and that it and any such
account is a QIB within the meaning of Rule 144A, and is aware that the
sale to it is being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as it has
requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon its
foregoing representations in order to claim the exemption from
registration provided by Rule 144A; and
(ii) if the proposed transferee is an Agent Member, and the
Securities to be transferred consist of Physical
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Securities which after transfer are to be evidenced by an interest in a
Global Security, upon receipt by the Registrar of written instructions
given in accordance with the Depository's and the Registrar's procedures,
the Registrar shall reflect on its books and records the date and an
increase in the principal amount of such Global Security in an amount
equal to the principal amount of the Physical Securities to be
transferred, and the Trustee shall cancel the Physical Securities so
transferred.
(c) Private Placement Legend. Upon the transfer, exchange or replacement
of Securities not bearing the Private Placement Legend, the Registrar shall
deliver Securities that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Securities bearing the Private Placement
Legend, the Registrar shall deliver only Securities that bear the Private
Placement Legend unless (i) the requested transfer is after the second
anniversary of the Issue Date (provided, however, that neither the Company nor
any Affiliate of the Company has held any beneficial interest in such Security,
or portion thereof, at any time prior to or on the second anniversary of the
Issue Date), or (ii) there is delivered to the Registrar an Opinion of Counsel
reasonably satisfactory to the Company and the Trustee to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act.
(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.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.6 or this Section 2.14.
The Company shall have the right to inspect and make copies of all such
letters, notices or other written communications at any reasonable time during
the Registrar's normal business hours upon the giving of reasonable written
notice to the Registrar.
(e) Transfers of Securities Held by Affiliates. Any certificate (i)
evidencing a Security that has been transferred to an Affiliate of the Company
within two years after the Issue Date, as evidenced by a notation on the
Assignment Form for such transfer or in the representation letter delivered in
re-
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spect thereof or (ii) evidencing a Security that has been acquired from an
Affiliate (other than by an Affiliate) in a transaction or a chain of
transactions not involving any public offering, shall, until two years after
the last date on which either the Company or any Affiliate of the Company was
an owner of such Security, in each case, bear a legend in substantially the
form set forth in Section 2.13 hereof, unless otherwise agreed by the Company
(with written notice thereof to the Trustee).
ARTICLE 3
REDEMPTION
SECTION 3.1. Optional Redemption.
(a) Except as set forth in the following paragraph, the Securities will
not be redeemable at the option of the Company prior to January 15, 2003.
Thereafter, the Securities will be redeemable, at the Company's option, in
whole or in part at any time or from time to time, upon not less than 30 nor
more than 60 days' prior notice mailed by first class mail to each Holder's
registered address, at the following redemption prices (expressed as
percentages of the principal amount thereof), plus accrued and unpaid interest
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 twelve-month period commencing on January 15 of
the years set forth below:
Redemption
Period Price
------ ----------
2003 105.6875%
2004 103.7917%
2005 101.8958%
2006 and thereafter 100.0000%
(b) At any time and from time to time, on or prior to January 15, 2001,
the Company may, at its option, redeem in the aggregate up to 35% of the
original principal amount of the Securities with the proceeds of one or more
Public Equity Offerings following which there is a Public Market, at a
redemption price (expressed as a percentage of principal amount) of 111.375%
plus accrued and unpaid 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); provided, however, that at least
65% of
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the original aggregate principal amount of the Securities must remain
outstanding after each such redemption.
SECTION 3.2. Notices to Trustee. If the Company elects to redeem
Securities pursuant to Section 3.1, it shall notify the Trustee in writing of
the redemption date, the principal amount of Securities to be redeemed and the
paragraph of the Securities pursuant to which the redemption will occur. The
Company shall give each notice to the Trustee provided for in this Section at
least 45 days before the redemption date unless the Trustee consents to a
shorter period. Such notice shall be accompanied by an Officers' Certificate
from the Company to the effect that such redemption will comply with the
provisions herein.
SECTION 3.3. Selection of Securities To Be Redeemed. If fewer than all
the Securities are to be redeemed, the Trustee shall select the Securities to
be redeemed pro rata or by lot or by such other method that complies with
applicable legal and securities exchange requirements, if any, and that the
Trustee in its sole discretion shall deem to be fair and appropriate and in
accordance with methods generally used at the time of selection by fiduciaries
in similar circumstances. The Trustee shall make the selection from
outstanding Securities not previously called for redemption. The Trustee may
select for redemption portions of the principal of Securities that have
denominations larger than $1,000. Securities and portions of them that the
Trustee selects shall be in amounts of $1,000 or a whole multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption
also apply to portions of Securities called for redemption. The Trustee shall
notify the Company promptly of the Securities or portions of Securities to be
redeemed. In the event the Company is required to make an offer to repurchase
Securities pursuant to Sections 4.7 or 4.12 and the amount available for such
offer is not evenly divisible by $1,000, the Trustee shall promptly refund to
the Company any remaining funds, which in no event will exceed $1,000.
SECTION 3.4. Notice of Redemption. At least 30 days but not more than 60
days before a date for redemption of Securities, the Company shall mail a
notice of redemption by first-class mail to the registered address appearing in
the Security Register of each Holder of Securities to be redeemed. The notice
shall identify the Securities (including CUSIP numbers, if any) to be redeemed
and shall state:
(1) the redemption date;
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(2) the redemption price;
(3) the name and address of the Paying Agent;
(4) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(5) if fewer than all the outstanding Securities are to be redeemed,
the identification and principal amounts of the particular Securities to
be redeemed;
(6) that, unless the Company defaults in making such redemption
payment, interest on Securities (or portion thereof) called for
redemption ceases to accrue on and after the redemption date;
(7) the paragraph of the Securities pursuant to which the
Securities called for redemption are being redeemed;
(8) the CUSIP number, if any, printed on the Securities being
redeemed; and
(9) that no representation is made as to the correctness or accuracy
of the CUSIP number, if any, listed in such notice or printed on the
Securities.
At the Company's written request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's sole expense; provided
that such request by the Company to the Trustee is received by the Trustee at
least three (3) Business Days prior to the date the Trustee is requested to
give notice to the Holders whose Securities are to be redeemed. In such event,
the Company shall provide the Trustee with the information required by this
Section.
SECTION 3.5. Effect of Notice of Redemption. Once notice of redemption
is mailed, Securities called for redemption become due and payable on the
redemption date and at the redemption price stated in the notice. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in the notice, plus accrued interest to the redemption date. Such
notice if mailed in the manner herein provided shall be conclusively presumed
to have been given, whether or not the Holder receives such notice. Failure to
give notice or any defect in the notice to any Holder shall not affect the
validity of the notice to any other Holder.
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SECTION 3.6. Deposit of Redemption Price. Prior to 11:00 a.m. (New York
City time) on the redemption date, the Company shall deposit with the Trustee
or Paying Agent (or, if the Company or a Subsidiary is the Paying Agent, shall
segregate and hold in trust) money sufficient to pay the redemption price of
and accrued interest (if any) on all Securities or portions thereof to be
redeemed on that date other than Securities or portions of Securities called
for redemption which have been delivered by the Company to the Trustee for
cancellation.
SECTION 3.7. Securities Redeemed in Part. Upon surrender of a Security
that is redeemed in part (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 his attorney
duly authorized in writing), the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge,
a new Security or Securities of any authorized denomination as requested by
such Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Security so surrendered, except that
if a Global Security is so surrendered, the Company shall execute, and the
Trustee shall authenticate and deliver to the Depository for such Global
Security, without service charge, a new Global Security in denomination equal
to and in exchange for the unredeemed portion of the principal of the Global
Security so surrendered.
ARTICLE 4
COVENANTS
SECTION 4.1. Payment of Securities. The Company shall promptly pay the
principal of and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal and interest shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due. The Company shall pay interest on overdue
principal at 1% per annum in excess of the rate per annum set forth in the
Securities, and it shall pay interest on overdue installments of interest at
the same rate to the extent lawful.
SECTION 4.2. SEC Reports. Until such time as the Company shall become
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company shall provide the Trustee, the Initial Purchasers, the
Securityholders
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and prospective Securityholders, in compliance with TIA Section 314, with such
annual reports and such information, documents and other reports as are
specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S.
corporation subject to such Sections, and such information, documents and other
reports to be so provided at the times specified for filing of such
information, documents and reports under such Sections. Thereafter,
notwithstanding that the Company may not be required to remain subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company
shall file with the SEC and provide the Trustee and Securityholders and
prospective Securityholders, in compliance with TIA Section 314, with such
annual reports and such information, documents and other reports as are
specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S.
corporation subject to such Sections, and such information, documents and other
reports to be so filed and provided at the times specified for the filing of
such information, documents and reports under such Sections; provided, however,
that the Company shall not be required to file any report, document or other
information with the SEC if the SEC does not permit such filing.
SECTION 4.3. Limitation on Incurrence of Indebtedness.
(a) The Company will not, and will not permit any Restricted Subsidiary
to, Incur, directly or indirectly, any Indebtedness; provided, however, that
the Company and the Restricted Subsidiaries may Incur Indebtedness if,
immediately after giving effect to such Incurrence, the Consolidated Coverage
Ratio exceeds 2.0 to 1 if such Indebtedness is Incurred prior to January 15,
2001, and 2.25 to 1 if such Indebtedness is Incurred thereafter.
(b) Notwithstanding the foregoing paragraph (a), the Company and the
Restricted Subsidiaries may Incur any or all of the following Indebtedness:
(1) Indebtedness Incurred pursuant to the Bank Credit Agreements and
Guarantees of Indebtedness Incurred pursuant to the Bank Credit
Agreement; provided, however, that, after giving effect to any such
Incurrence, the aggregate principal amount of such Indebtedness then
outstanding does not exceed the greater of (i) $115.0 million less the
amount of Net Available Cash from Asset Sales used to permanently reduce
indebtedness under the Bank Credit Agreements and (ii) the sum of (x) 85%
of the net book value of the accounts receivable of the Company and
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its Restricted Subsidiaries, determined in accordance with GAAP and (y)
50% of the net book value of the inventory of the Company and its
Restricted Subsidiaries, determined in accordance with GAAP;
(2) Indebtedness represented by (i) the Securities issued in the
Offering (and the Exchange Securities), (ii) up to $30 million aggregate
principal amount of Securities issued subsequent to the Issue Date and
(iii) Indebtedness represented by the Subsidiary Guarantees;
(3) Indebtedness outstanding on the Issue Date (other than
Indebtedness described in clause (1) of this Section 4.3(b));
(4) Indebtedness of the Company owed to and held by any Wholly-Owned
Subsidiary or Indebtedness of a Wholly-Owned Subsidiary owed to and held
by the Company or a Wholly-Owned Subsidiary; provided, however, that any
subsequent issuance or transfer of any Capital Stock which results in any
such Wholly-Owned Subsidiary ceasing to be a Wholly-Owned Subsidiary or
any subsequent transfer of such Indebtedness (other than to the Company
or a Wholly-Owned Subsidiary) shall be deemed, in each case, to
constitute the Incurrence of such Indebtedness by the issuer thereof;
(5) Refinancing Indebtedness in respect of Indebtedness Incurred
pursuant to paragraph (a) or pursuant to clause (2), (3) or this clause
(5) of this Section 4.3(b);
(6) Indebtedness in respect of performance bonds, bankers'
acceptances, letters of credit and surety or appeal bonds entered into by
the Company or a Restricted Subsidiary in the ordinary course of business
(in each case other than an obligation for borrowed money);
(7) Hedging Obligations consisting of Interest Rate Agreements and
Currency Agreements entered into in the ordinary course of business and
not for the purpose of speculation; provided, however, that, in the case
of Currency Agreements and Interest Rate Agreements, such Currency
Agreements and Interest Rate Agreements do not increase the Indebtedness
of the Company outstanding at any time other than as a result of
fluctuations in foreign currency exchange rates or interest rates or by
reason of fees, indemnities and compensation payable thereunder;
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(8) Purchase Money Indebtedness and Capital Lease Obligations
Incurred to finance the acquisition or improvement by the Company or a
Restricted Subsidiary of any assets in the ordinary course of business
and which do not exceed $7.0 million in the aggregate at any time
outstanding;
(9) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument
inadvertently (except in the case of daylight overdrafts) drawn against
insufficient funds in the ordinary course of business, provided that such
Indebtedness is extinguished within five business days of Incurrence;
(10) Indebtedness Incurred after the Issue Date representing
interest paid-in-kind; or
(11) Indebtedness in an aggregate principal amount which, together
with all other Indebtedness of the Company and its Restricted
Subsidiaries outstanding on the date of such Incurrence (other than
Indebtedness permitted by clauses (1) through (10) above or paragraph (a)
of this Section 4.3), does not exceed $10.0 million.
(c) Notwithstanding the foregoing, the Company shall not, and shall
not permit any Restricted Subsidiary to, Incur any Indebtedness pursuant to the
foregoing Section 4.3(b) if the proceeds thereof are used, directly or
indirectly, to Refinance (i) any Subordinated Obligations unless such
Indebtedness shall be subordinated to the Securities and the Subsidiary
Guarantees, as applicable, to at least the same extent as such Subordinated
Obligations or (ii) any Senior Subordinated Indebtedness unless such
Indebtedness shall be Senior Subordinated Indebtedness or shall be subordinated
to the Securities and the Subsidiary Guarantees, as applicable.
(d) For purposes of determining compliance with this Section 4.3,
(i) in the event that an item of Indebtedness meets the criteria of more than
one of the types of Indebtedness described above, the Company, in its sole
discretion, will classify such item of Indebtedness and only be required to
include the amount and type of such Indebtedness in one of the above clauses
and (ii) an item of Indebtedness may be divided and classified in more than one
of the types of Indebtedness described above.
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SECTION 4.4. Limitation on Layered Debt. Notwithstanding paragraphs (a)
and (b) of Section 4.3 hereof, the Company shall not, and shall not permit any
Subsidiary Guarantor to, Incur any Indebtedness if such Indebtedness is
subordinate or junior in ranking in any respect to any Senior Indebtedness of
the Company or such Subsidiary Guarantor, as applicable, unless such
Indebtedness is Senior Subordinated Indebtedness or is expressly subordinated
in right of payment to Senior Subordinated Indebtedness.
SECTION 4.5. Limitation on Restricted Payments.
(a) The Company will not, and will not permit any Restricted Subsidiary,
directly or indirectly, to make a Restricted Payment if at the time the Company
or such Restricted Subsidiary makes such Restricted Payment: (1) a Default
will have occurred and be continuing (or would result therefrom); (2) the
Company is not able to Incur an additional $1.00 of Indebtedness under Section
4.3(a); or (3) the aggregate amount of such Restricted Payment together with
all other Restricted Payments (the amount of any payments made in property
other than cash to be valued at the fair market value of such property as
determined in good faith by the Board of Directors) declared or made since the
Issue Date would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued during the period
(treated as one accounting period) from the Issue Date to the end of the
most recent fiscal quarter prior to the date of such Restricted Payment
for which financial statements of the Company are available (or, in case
such Consolidated Net Income accrued during such period (treated as one
accounting period) shall be a deficit, minus 100% of such deficit);
(B) the aggregate Net Cash Proceeds received subsequent to the Issue
Date by the Company from the issuance or sale of (i) its Capital Stock
(other than Disqualified Stock or the issuance or sale of Capital Stock
to a Subsidiary of the Company) or (ii) the Capital Stock of a Restricted
Subsidiary pursuant to a Qualified TIPS Transaction (other than any
issuance or sale to a Subsidiary of the Company);
(C) the amount by which Indebtedness of the Company or its
Restricted Subsidiaries is reduced on the Company's balance sheet upon
the conversion or exchange (other than by a Subsidiary of the Company)
subsequent to the Issue Date, of any Indebtedness of the Company or its
Restricted
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Subsidiaries convertible or exchangeable for Capital Stock (other than
Disqualified Stock) of the Company (less the amount of any cash, or the
fair market value of any other property, distributed by the Company or
any Restricted Subsidiary upon such conversion or exchange); and
(D) an amount equal to the sum of the net reduction in Investments
resulting from repayments of loans or advances or other transfers of
assets subsequent to the Issue Date, in each case to the Company or any
Restricted Subsidiary; provided, however, that the foregoing sum shall
not exceed the amount of Investments previously made (and treated as a
Restricted Payment) by the Company or any Restricted Subsidiary in such
Person;
(b) The provisions of Section 4.5(a) will not prohibit:
(i) any purchase or redemption of Capital Stock or Subordinated
Obligations of the Company or any Restricted Subsidiary made in exchange
for, or out of the proceeds of the substantially concurrent sale of,
Capital Stock of the Company (other than Disqualified Stock and other
than Capital Stock issued or sold to a Subsidiary of the Company);
provided, however, that (A) such purchase or redemption shall be excluded
from the calculation of the amount of Restricted Payments and (B) the Net
Cash Proceeds from such sale shall be excluded from the calculation of
amounts under Section 4.5(a)(3)(B);
(ii) any purchase or redemption of (A) Subordinated Obligations of
the Company made in exchange for, or out of the proceeds of the
substantially concurrent sale of, Subordinated Obligations of the Company
which is permitted to be Incurred pursuant to Section 4.3(b) and (c)
hereof or (B) Subordinated Obligations of a Restricted Subsidiary made in
exchange for, or out of the proceeds of the substantially concurrent sale
of, Subordinated Obligations of such Restricted Subsidiary or the Company
which is permitted to be Incurred pursuant to Section 4.3(b) and (c)
hereof; provided, however, that such purchase or redemption shall be
excluded from the calculation of the amount of Restricted Payments;
(iii) dividends paid within 60 days after the date of declaration
thereof if at such date of declaration such dividend would have complied
with this Section 4.5; provided, however, that at the time of payment of
such divi-
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dend, no other Default shall have occurred and be continuing (or would
result therefrom); provided, further, however, that such dividend shall
be included in the calculation of the amount of Restricted Payments;
(iv) any purchase or redemption or other retirement for value of
Capital Stock of the Company required pursuant to any shareholders'
agreement, management agreement or employee stock option agreement in
accordance with the provisions of any such arrangement in an amount not
to exceed $1.5 million in the aggregate; provided, however, that at the
time of such purchase or redemption, no other Default shall have occurred
and be continuing (or would result therefrom); provided, further,
however, that such purchase or redemption shall be included in the amount
of Restricted Payments; or
(v) Guarantees by the Company or any Restricted Subsidiary of
Indebtedness Incurred by the Company or a Restricted Subsidiary,
provided, however, that at the time such Guarantee is Incurred it would
be permitted under Section 4.3 hereof, provided, further, however, that
such Guarantee shall be excluded from the amount of Restricted Payments.
SECTION 4.6. 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 consensual restriction on the ability of any
Restricted Subsidiary (a) to pay dividends or make any other distributions on
its Capital Stock to the Company or a Restricted Subsidiary or pay any
Indebtedness owed to the Company, (b) to make any loans or advances to the
Company or (c) to transfer any of its property or assets to the Company;
except:
(i) any encumbrance or restriction pursuant to an agreement in
effect at or entered into on the Issue Date;
(ii) any encumbrance or restriction with respect to a Restricted
Subsidiary pursuant to an agreement relating to any Indebtedness Incurred
by such Restricted Subsidiary which was entered into on or prior to the
date on which such Restricted Subsidiary was acquired by the Company
(other than 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
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pursuant to which such Restricted Subsidiary became a Restricted
Subsidiary or was acquired by the Company) and outstanding on such date;
(iii) any encumbrance or restriction pursuant to an agreement
effecting a Refinancing of Indebtedness Incurred pursuant to an agreement
referred to in clause (i) or (ii) of this Section 4.6 (or effecting a
Refinancing of such Refinancing Indebtedness pursuant to this clause
(iii)) or contained in any amendment to an agreement referred to in
clause (i) or (ii) of this Section 4.6 or this clause (iii); provided,
however, that the encumbrances and restrictions with respect to such
Restricted Subsidiary contained in any such refinancing agreement or
amendment are no more restrictive in any material respect than
encumbrances and restrictions with respect to such Restricted Subsidiary
contained in such agreements;
(iv) any such encumbrance or restriction consisting of customary
non-assignment provisions in leases governing leasehold interests to the
extent such provisions restrict the transfer of the lease or the property
leased thereunder;
(v) in the case of Section 4.6(c) above, restrictions contained in
security agreements or mortgages securing Indebtedness of a Restricted
Subsidiary to the extent such restrictions restrict the transfer of the
property subject to such security agreements or mortgages;
(vi) any restriction with respect to (x) a Restricted Subsidiary
imposed pursuant to an agreement entered into for the sale or disposition
of all or substantially all the Capital Stock or assets of such
Restricted Subsidiary or (y) an asset of a Restricted Subsidiary pursuant
to an agreement entered into for the sale or disposition of such asset,
in each case pending the closing of such sale or disposition;
(vii) any restrictions imposed by applicable law; and
(viii) any encumbrance or restriction with respect to a Foreign
Restricted Subsidiary which is contained in agreements evidencing Indebtedness
permitted under Section 4.3 hereof and which encumbrance or restriction is
customary in agreements of such type.
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SECTION 4.7. Limitation on Sales of Assets and Subsidiary Stock.
(a) The Company will not, and will not permit any Restricted Subsidiary
to, consummate any Asset Disposition unless (i) the Company or such Restricted
Subsidiary receives consideration at the time of such Asset Disposition at
least equal to the fair market value (including as to the value of all non-cash
consideration), as determined in good faith by the Board of Directors, of the
shares and assets subject to such Asset Disposition, and (ii) at least 75% of
the consideration therefor received by the Company or such Restricted
Subsidiary is in the form of cash or cash equivalents, provided, however, that
this clause (ii) shall not apply if the Company or a Restricted Subsidiary is
disposing of assets in exchange for Additional Assets.
With respect to any Asset Disposition occurring on or after the Issue Date
from which the Company or any Restricted Subsidiary receives Net Available
Cash, the Company or such Restricted Subsidiary shall (i) within 365 days after
the date such Net Available Cash is received and to the extent the Company or
such Restricted Subsidiary elects (or is required by the terms of any Senior
Indebtedness) to (A) apply an amount equal to such Net Available Cash to
prepay, repay, purchase or legally defease Senior Indebtedness of the Company
or such Restricted Subsidiary, in each case owing to a Person other than the
Company or any Affiliate of the Company, or (B) invest an equal amount, or the
amount not so applied pursuant to clause (A), in Additional Assets (including
by means of an Investment in Additional Assets by a Subsidiary Guarantor with
Net Available Cash received by the Company or another Subsidiary Guarantor) and
(ii) apply such excess Net Available Cash (to the extent not applied pursuant
to clause (i)) as provided in the following paragraphs of this Section 4.7;
provided, however, that in connection with any prepayment, repayment or
purchase of Senior Indebtedness pursuant to clause (A) above (other than the
repayment of Senior Indebtedness Incurred under a Bank Credit Agreement to fund
the purchase of an asset which is sold by the Company within 180 days of its
purchase pursuant to a Sale/Leaseback Transaction), the Company or such
Restricted Subsidiary shall retire such Senior Indebtedness and shall cause the
related loan commitment (if any) to be permanently reduced in an amount equal
to the principal amount so prepaid, repaid or purchased. The amount of Net
Available Cash required to be applied pursuant to clause (ii) above and not
theretofore so applied shall constitute "Excess Proceeds." Pending applica-
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tion of Net Available Cash pursuant to this provision, such Net Available Cash
shall be invested in Temporary Cash Investments.
If at any time the aggregate amount of Excess Proceeds not theretofore
subject to an Excess Proceeds Offer (as defined below) totals at least $3
million, the Company shall, not later than 30 days after the end of the period
during which the Company is required to apply such Excess Proceeds pursuant to
clause (i) of the immediately preceding paragraph of this Section 4.7(a) (or,
if the Company so elects, at any time within such period), make an offer (an
"Excess Proceeds Offer") to purchase from the Holders of Securities and Other
Qualified Securities (determined on a pro rata basis according to the accreted
value or aggregate principal amount, as the case may be, of the Securities and
Other Qualified Securities) in an amount equal to the Excess Proceeds (rounded
down to the nearest multiple of $1,000) on such date, at a purchase price equal
to 100% of the principal amount of such Securities, plus, in each case, accrued
interest (if any) to the date of purchase (the "Excess Proceeds Payment").
Upon completion of an Excess Proceeds Offer the amount of Excess Proceeds
remaining after application pursuant to such Excess Proceeds Offer, (including
payment of the purchase price for Securities duly tendered) may be used by the
Company for any corporate purpose (to the extent not otherwise prohibited by
this Indenture).
For the purposes of this Section 4.7, the following are deemed to be cash
or cash equivalents: (x) the assumption of Indebtedness 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, and (y) securities received by the Company or any Restricted
Subsidiary from the transferee that are immediately converted by the Company or
such Restricted Subsidiary into cash.
(b) Promptly, and in any event within 30 days after the Company becomes
obligated to make an Excess Proceeds Offer, the Company shall be obligated to
deliver to the Trustee and send, by first-class mail to each Holder, at the
address appearing in the Security Register, a written notice stating that the
Holder may elect to have his Securities purchased by the Company either in
whole or in part (subject to prorationing as hereinafter described in the event
the Excess Proceeds Offer is oversubscribed) in integral multiples of $1,000 of
principal amount, at the applicable purchase price. The notice, which shall
govern the terms of the Excess Proceeds Offer, shall include such disclosures
as are required by law and shall specify
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(i) that the Excess Proceeds Offer is being made pursuant to this Section 4.7;
(ii) the purchase price (including the amount of accrued interest, if any) for
each Security and the purchase date not less than 30 days nor more than 60 days
after the date of such notice (the "Purchase Date"); (iii) that any Security
not tendered or accepted for payment will continue to accrue interest in
accordance with the terms thereof; (iv) that, unless the Company defaults in
making the payment, any Security accepted for payment pursuant to the Excess
Proceeds Offer shall cease to accrue interest on and after the Purchase Date;
(v) that Securityholders electing to have Securities purchased pursuant to an
Excess Proceeds Offer will be required to surrender their Securities to the
Paying Agent at the address specified in the notice at least three business
days prior to the Purchase Date and must complete any form letter of
transmittal proposed by the Company and acceptable to the Trustee and the
Paying Agent; (vi) that Securityholders will be entitled to withdraw their
election if the Paying Agent receives, not later than one business day prior to
the Purchase Date, a telex, facsimile transmission or letter setting forth the
name of the Securityholder, the principal amount of Securities the
Securityholder delivered for purchase, the Security certificate number (if any)
and a statement that such Securityholder is withdrawing its election to have
such Securities purchased; (vii) that if Securities in a principal amount in
excess of the aggregate principal amount which the Company has offered to
purchase are tendered pursuant to the Excess Proceeds Offer, the Company shall
purchase Securities on a pro rata basis among the Securities tendered (with
such adjustments as may be deemed appropriate by the Company so that only
Securities in denominations of $1,000 or integral multiples of $1,000 shall be
acquired); (viii) that Securityholders whose Securities are purchased only in
part will be issued new Securities equal in principal amount to the unpurchased
portion of the Securities surrendered; and (ix) the instructions that
Securityholders must follow in order to tender their Securities.
(c) Not later than the date upon which written notice of an Excess
Proceeds Offer is delivered to the Trustee as provided above, the Company shall
deliver to the Trustee an Officers' Certificate as to (i) the amount of the
Excess Proceeds Offer (the "Excess Proceeds Offer Amount"), (ii) the allocation
of the Net Available Cash from the Asset Dispositions pursuant to which such
Excess Proceeds Offer is being made and (iii) the compliance of such allocation
with the provisions of Section 4.7(a). Upon the expiration of the period for
which the Excess Proceeds Offer remains open (the "Excess Proceeds Offer
Period"), the Company shall deliver to the Trustee for cancella-
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tion the Securities or portions thereof which have been properly tendered to
and are to be accepted by the Company. Not later than 11:00 a.m. (New York
City time) on the Purchase Date, the Company shall irrevocably deposit with the
Trustee or with a paying agent (or, if the Company is acting as Paying Agent,
segregate and hold in trust) an amount in cash sufficient to pay the Excess
Proceeds Offer Amount for all Securities properly tendered to and accepted by
the Company. The Trustee shall, as promptly as possible after the Purchase
Date, mail or deliver payment to each tendering Holder in the amount of the
purchase price.
(d) Holders electing to have a Security purchased will be required to
surrender the Security, together with all necessary endorsements and other
appropriate materials duly completed, to the Company at the address specified
in the notice at least three Business Days prior to the Purchase Date. Holders
will be entitled to withdraw their election in whole or in part if the Trustee
or the Company receives not later than one Business Day prior to the Purchase
Date, a facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Security (which shall be $1,000 or an integral
multiple thereof) which was delivered for purchase by the Holder, the aggregate
principal amount of such Security (if any) that remains subject to the original
notice of the Excess Proceeds Offer and that has been or will be delivered for
purchase by the Company and a statement that such Holder is withdrawing his
election to have such Security purchased. If at the expiration of the Excess
Proceeds Offer Period the aggregate principal amount of Securities surrendered
by Holders exceeds the Excess Proceeds Offer Amount, the Company shall select
the Securities to be purchased on a pro rata basis (with such adjustments as
may be deemed appropriate by the Company so that only securities in
denominations of $1,000, or integral multiples thereof, shall be purchased).
Holders whose Securities are purchased only in part will be issued new
Securities equal in principal amount to the unpurchased portion of the
Securities surrendered.
(e) A Security shall be deemed to have been accepted for purchase at the
time the Trustee, directly or through an agent, mails or delivers payment
therefor to the surrendering Holder.
(f) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 4.7. To
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the extent that the provisions of any securities laws or regulations conflict
with provisions of this Section 4.7, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section by virtue thereof.
SECTION 4.8. Limitation on Affiliate Transactions.
(a) The Company will not, and will not permit any Restricted Subsidiary
to, enter into or permit to exist any transaction or series of related
transactions (including the purchase, sale, lease or exchange of any property,
employee compensation arrangements or the rendering of any service) with any
Affiliate of the Company (an "Affiliate Transaction") unless the terms thereof
(1) are no less favorable to the Company or such Restricted Subsidiary 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, (2) if such Affiliate
Transaction (or series of related Affiliate Transactions) involves aggregate
payments in an amount in excess of $1.0 million, (i) are set forth in writing,
(ii) comply with clause (1) of this Section 4.8(a), (3) if such Affiliate
Transaction (or series of related Affiliate Transactions) involves aggregate
payments in an amount in excess of $2.5 million in any one year, (i) are set
forth in writing, (ii) comply with clause (2) of this Section 4.8(a) and (iii)
have been approved by a majority of the disinterested members of the Board of
Directors and (4) if such Affiliate Transaction (or series of related Affiliate
Transactions) involves aggregate payments in an amount in excess of $10.0
million in any one year, (i) comply with clause (3) of this Section 4.8(a) and
(ii) have been determined by a nationally recognized investment banking firm to
be fair, from a financial standpoint, to the Company and its Restricted
Subsidiaries.
(b) Section 4.8(a) shall not prohibit (i) any Restricted Payment
permitted to be paid pursuant to Section 4.5, (ii) any issuance of securities,
or other payments, awards or grants in cash, securities or otherwise, pursuant
to, or the funding of, employment arrangements, stock options and stock
ownership plans in the ordinary course of business and approved by the Board of
Directors, (iii) the grant of stock options or similar rights to employees and
directors of the Company in the ordinary course of business and pursuant to
plans approved by the Board of Directors, (iv) loans or advances to employees
of the Company or its Subsidiaries, provided, however, that the aggregate
amount of such loans or advances outstanding at any one time shall not exceed
$1.5 million, (v) fees, compensation
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or employee benefit arrangements paid to and indemnity provided for the benefit
of directors, officers or employees of the Company or any Subsidiary in the
ordinary course of business, (vi) any Affiliate Transaction between the Company
and a Restricted Subsidiary or between Restricted Subsidiaries in the ordinary
course of business (so long as the other stockholders of any participating
Restricted Subsidiaries which are not Wholly-Owned Subsidiaries are not
themselves Affiliates of the Company), or (vii) Existing Affiliate Agreements,
including amendments thereto or replacements thereof entered into after the
Issue Date, provided, however, that the terms of any such amendment or
replacement are at least as favorable to the Company as those that could be
obtained at the time of such amendment or replacement in arm's-length dealings
with a Person which is not an Affiliate. If the Company or any Restricted
Subsidiary has complied with all of the provisions of the foregoing paragraph
(a) of this Section 4.8 other than clause (4)(ii) thereof, such paragraph shall
not prohibit the Company or any Restricted Subsidiary from entering into
Affiliate Transactions pursuant to which the Company or any Restricted
Subsidiary renders services in the ordinary course of business to CVC or
MascoTech or to Affiliates of CVC or MascoTech.
SECTION 4.9. Limitation on Issuance or Sale of Capital Stock of
Restricted Subsidiaries. The Company will not (i) sell, pledge, hypothecate or
otherwise dispose of any shares of Capital Stock of a Restricted Subsidiary
(other than pledges of Capital Stock securing Senior Indebtedness), or (ii)
permit any Restricted Subsidiary, directly or indirectly, to issue or sell or
otherwise dispose of any shares of its Capital Stock other than (A) to the
Company or a Restricted Subsidiary, (B) directors' qualifying shares and Shares
owned by foreign shareholders, to the extent required by applicable local laws
in foreign countries, (C) pursuant to a Qualified TIPS Transaction or (D) if,
immediately after giving effect to such issuance or sale, such Restricted
Subsidiary would no longer constitute a Subsidiary. The proceeds of any sale
of such Capital Stock permitted hereby will be treated as Net Available Cash
from an Asset Disposition and must be applied in accordance with Section 4.7.
SECTION 4.10. Limitation on Liens. The Company will not, and will not
permit any Restricted Subsidiary to, directly or indirectly, Incur or permit to
exist any Lien (other than Permitted Liens) of any nature whatsoever on any
property of the Company or any Restricted Subsidiary (including Capital Stock
of a Restricted Subsidiary), whether owned at the Issue Date or thereafter
acquired, which secures Indebtedness that
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ranks pari passu with or is subordinated to the Securities or the Subsidiary
Guarantees unless:
(i) if such Lien secures Indebtedness that ranks pari passu with the
Securities and the Subsidiary Guarantees, the Securities and Subsidiary
Guarantees are secured on an equal and ratable basis with the obligation
so secured until such time as such obligation is no longer secured by a
Lien; or
(ii) if such Lien secures Indebtedness that is subordinated to the
Securities and the Subsidiary Guarantees, such Lien shall be subordinated
to a Lien granted to the Holders on the same collateral as that securing
such Lien to the same extent as such subordinated Indebtedness is
subordinated to the Securities and the Subsidiary Guarantees.
SECTION 4.11. Designation of Restricted and Unrestricted Subsidiaries.
The Board of Directors may designate any Subsidiary of the Company (including
any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary
if (a) the Subsidiary to be so designated (the "Designee") does not own any
Capital Stock or Indebtedness of, or own or hold any Lien on any property of,
the Company or any other Subsidiary (other than a direct or indirect Subsidiary
of the Designee, provided, however, that any such direct or indirect Subsidiary
of the Designee shall otherwise comply with clauses (a) through (f) of this
covenant), (b) the Subsidiary to be so designated is not obligated under any
Indebtedness, Lien or other obligation that, if in default, would result (with
the passage of time or notice or otherwise) in a default on any Indebtedness of
the Company or of any Subsidiary (other than the Designee or a Subsidiary of
the Designee that is an Unrestricted Subsidiary), (c) the Company certifies
that such designation complies with Section 4.5 hereof, (d) such Subsidiary,
either alone or in the aggregate with all other Unrestricted Subsidiaries, does
not operate, directly or indirectly, all or substantially all of the business
of the Company and its Subsidiaries; (e) such Subsidiary does not directly or
indirectly, own any Indebtedness of or Capital Stock in, and has no Investments
in, the Company or any Restricted Subsidiary; and (f) such Subsidiary is a
Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (i) to subscribe for
additional Capital Stock or (ii) to maintain or preserve such Person's
financial condition or to cause such Person to achieve any specified levels of
operating results. If, at any time, any Unrestricted Subsidi-
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ary would fail to meet the foregoing requirements as an Unrestricted
Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for
purposes of this Indenture and any Indebtedness of such Subsidiary shall be
deemed to be Incurred as of such date. For purposes of making any such
designation, all outstanding Investments by the Company and its Restricted
Subsidiaries (except to the extent repaid in cash) in the Subsidiary will be
deemed to be Restricted Payments at the time of such designation and will
reduce the amount available for Restricted Payments under Section 4.5(a)(3)
hereof. Such designation shall 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.
Any such designation or redesignation pursuant to this Section 4.11 by the
Board of Directors will be evidenced to the Trustee by filing with the Trustee
a Board Resolution giving effect to such designation or redesignation and an
Officers' Certificate (a) certifying that such designation or redesignation
complies with the foregoing provisions and (b) giving the effective date of
such designation or redesignation, such filing with the Trustee to occur within
45 days after the end of the fiscal quarter of the Company in which such
designation or redesignation is made (or, in the case of a designation or
redesignation made during the last fiscal quarter of the Company's fiscal year,
within 90 days after the end of such fiscal year). Unless designated as an
Unrestricted Subsidiary as provided in this Section 4.11, each Subsidiary of
the Company shall be a Restricted Subsidiary. Except as provided in this
Section 4.11, no Restricted Subsidiary shall be redesignated as an Unrestricted
Subsidiary.
The Board of Directors may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary, if immediately after giving pro forma effect to such
designation (a) the Company could Incur $1.00 of additional Indebtedness under
Section 4.3(a) and hereof (b) no Default shall have occurred and be continuing
or would result therefrom.
SECTION 4.12. Change of Control.
(a) Upon the occurrence of a Change of Control, each Holder shall have
the right to require that the Company repurchase all or a portion 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
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interest payment date), in accordance with the terms of Section 4.12(b).
(b) Within 30 days following any Change of Control, the Company shall
mail a notice to each Holder with a copy to the Trustee stating:
(1) that a Change of Control has occurred and that such Holder has
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
outstanding at the repurchase date, 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 on the relevant interest
payment date);
(2) the circumstances and relevant facts and relevant financial
information regarding such Change of Control;
(3) the repurchase date (which shall be no earlier than 30 days nor
later than 60 days from the date such notice is mailed); and
(4) the instructions determined by the Company, consistent with this
Section 4.12, that a Holder must follow in order to have its Securities
repurchased.
(c) Holders electing to have a Security purchased will be required
to surrender the Security, together with all necessary endorsements and other
appropriate materials duly completed, to the Company at the address specified
in the notice at least three Business Days prior to the purchase date. Holders
will be entitled to withdraw their election if the Trustee or the Company
receives not later than one Business Day prior to the purchase date, a
facsimile transmission or letter setting forth the name of the Holder, the
principal amount of the Security which was delivered for purchase by the Holder
as to which such notice of withdrawal is being submitted and a statement that
such Holder is withdrawing his election to have such Security purchased.
(d) On the purchase date, all Securities purchased by the Company
under this Section shall be delivered to the Trustee for cancellation, and the
Company shall pay the purchase price plus accrued and unpaid interest, if any,
to the Holders entitled thereto.
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(e) The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities laws
or regulations in connection with the repurchase of Securities pursuant to this
Section 4.12. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section by virtue thereof.
(f) Notwithstanding the occurrence of a Change of Control, the
Company shall not be obligated to repurchase the Securities or otherwise comply
with this Section if the Company has irrevocably elected to redeem all the
Securities in accordance with Article Three; provided that the Company does not
default in its redemption obligations pursuant to such election.
SECTION 4.13. Compliance Certificate. The Company shall deliver to
the Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate, one of the signers of which shall be the principal
executive, financial or accounting officer of the Company, stating that in the
course of the performance by the signers of their duties as Officers of the
Company they would normally have knowledge of any breach of covenant or other
obligations or any Default and whether or not the signers know of any breach of
covenant or other obligation or any Default that occurred during such period.
If they do, the certificate shall describe the breaches of covenants, other
obligation or Default, its status and what action the Company is taking or
proposes to take with respect thereto. The Company also shall comply with TIA
Section 314(a)(4).
SECTION 4.14. Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 4.15. Payment of Taxes and Other Claims. The Company
shall, and shall cause each of its Subsidiaries to, pay or discharge or cause
to be paid or discharged, before the same shall become delinquent, all taxes,
assessments and governmental charges levied or imposed upon its or its
Subsidiaries' income, profits or property; provided, however, that neither the
Company nor any of its Subsidiaries shall be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or
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validity is being contested in good faith by appropriate negotiations or
proceedings and for which disputed amounts adequate reserves have been made in
accordance with GAAP.
SECTION 4.16. Future Guarantors. The Company shall cause each Domestic
Restricted Subsidiary that at any time becomes an obligor or guarantor with
respect to any obligations under one or more Bank Credit Agreements to execute
and deliver to the Trustee a supplemental indenture pursuant to which such
Domestic Restricted Subsidiary will Guarantee payment of the Securities on the
same terms and conditions as those set forth in this Indenture. Each
Subsidiary Guarantee will be limited in amount to an amount not to exceed the
maximum amount that can be Guaranteed by the applicable Subsidiary Guarantor
without rendering such Subsidiary Guarantee voidable under applicable law
relating to fraudulent conveyance or fraudulent transfer or similar laws
affecting the rights of creditors generally.
SECTION 4.17. Maintenance of Office or Agency. The Company shall
maintain in the Borough of Manhattan, the City of New York, an office or agency
(which may be an office or agency of the Trustee, Registrar or co-Registrar),
where Securities may be surrendered for registration of transfer or exchange or
for presentation for payment and where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served. The
Company will give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the address of the Trustee's
office in New York City as set forth in Section 13.2.
The Company may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York, for such purposes. The Company will give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
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The Company hereby initially designates the Trustee's office in New York
City as set forth in Section 13.2 as an agency of the Company in accordance
with Section 2.3.
SECTION 4.18. Corporate Existence. Subject to Article 5 and Section 4.7,
the Company shall do or cause to be done, at its own cost and expense, all
things necessary to, and will cause each of its Restricted Subsidiaries to,
preserve and keep in full force and effect the corporate or partnership
existence and rights (charter and statutory), licenses and/or franchises of the
Company and each of its Restricted Subsidiaries; provided, however, that the
Company or any of its Restricted Subsidiaries shall not be required to preserve
any such rights, licenses or franchises if the Board of Directors shall
reasonably determine that the preservation thereof is no longer desirable in
the conduct of the business of the Company and the Subsidiaries, taken as a
whole.
ARTICLE 5
SUCCESSOR COMPANY
SECTION 5.1. Merger, Consolidation and Sale of Assets. The Company will
not consolidate with or merge with or into, or convey, transfer or lease, in
one transaction or a series of related transactions, all or substantially all
its assets to, any Person, unless:
(i) the resulting, surviving or transferee Person (the "Successor
Company") will be a corporation 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) will expressly
assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, all the obligations of
the Company under the Securities and this Indenture;
(ii) immediately after giving effect to such transaction on a pro
forma basis (and treating any Indebtedness which becomes an obligation of
the Successor Company or any Subsidiary as a result of such transaction
as having been Incurred by such Successor Company or such Subsidiary at
the time of such transaction), no Default will have occurred and be
continuing;
(iii) except in the case of a merger the sole purpose of which is to
change the Company's jurisdiction of incor-
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poration, immediately after giving effect to such transaction on a pro
forma basis, the Successor Company would be able to Incur an additional
$1.00 of Indebtedness pursuant to Section 4.3(a);
(iv) immediately after giving effect to such transaction on a pro
forma basis, the Successor Company will have a Consolidated Net Worth in
an amount that is not less than the Consolidated Net Worth of the Company
immediately prior to such transaction; and
(v) the Company will have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if
any) comply with this Indenture.
Notwithstanding the foregoing clauses (ii), (iii) and (iv) of this Section
5.1, any Restricted Subsidiary may consolidate with, merge into or transfer all
or part of its properties and assets to the Company or another Restricted
Subsidiary.
The Successor Company will be the successor to the Company and succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture, but the predecessor Company in the case of a conveyance,
transfer or lease, will not be released from the obligation to pay the
principal of and interest on the Securities.
The Company shall not permit any Subsidiary Guarantor to consolidate with
or merge with or into, or convey, transfer or lease, in one transaction or a
(other than the Company or a Wholly-Owned Subsidiary), unless: (i) the
resulting, surviving or transferee Person (if not such Subsidiary) shall be a
corporation 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 such Subsidiary) shall expressly assume, by a Guarantee
agreement, in form satisfactory to the Trustee, all the obligations of such
Subsidiary under its Subsidiary Guarantee; (ii) immediately after giving effect
to such transaction on a pro forma basis (and treating any Indebtedness which
becomes an obligation of the resulting, surviving or transferee Person as a
result of such transaction as having been Incurred by such Person at the time
of such transaction), no Default shall have occurred and be continuing; and
(iii) the Company shall have delivered to the
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Trustee an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger or transfer and such Guarantee agreement comply with
this Indenture. The provisions of clauses (i) and (iii) above shall not apply
to any transactions which constitute an Asset Disposition if the Company has
complied with the applicable provisions of Section 4.7 hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.1. Events of Default. An "Event of Default" occurs if:
(i) the Company defaults in the payment of interest on any Security
when the same becomes due and payable (whether or not such payment is
prohibited by the provisions of Article 10 hereof), and such default
continues for a period of 30 days;
(ii) the Company defaults in the payment of the principal of any
Security when the same becomes due and payable at its Stated Maturity,
upon optional redemption, upon required repurchase, upon declaration or
otherwise (whether or not such payment is prohibited by the provisions of
in Article 10 hereof);
(iii) the Company fails to comply for 60 days after notice with any
obligations under Section 4.3, 4.5, 4.7 or 5.1 hereof;
(iv) the Company fails to comply with any of its other agreements
contained in this Indenture (other than those referred to in (i), (ii),
or (iii) above) and such failure continues for 60 days after the notice
specified below;
(v) the Company or any Restricted Subsidiary of the Company fails to
pay any Indebtedness within any applicable grace period after final
maturity or acceleration of any such Indebtedness by the holders thereof
because of a default and the total amount of such Indebtedness unpaid or
accelerated exceeds $5.0 million;
(vi) the Company or any Significant Subsidiary of the Company
pursuant to or within the meaning of any Bankruptcy Law:
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(A) commences a voluntary case;
(B) consents to the entry of an order for relief against it in
an involuntary case in which it is the debtor;
(C) consents to the appointment of a Custodian of it or for
any substantial part of its property; or
(D) makes a general assignment for the benefit of its
creditors;
or takes any comparable action under any foreign laws relating to
insolvency;
(vii) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary of the Company in an involuntary case;
(B) appoints a Custodian of the Company or any Significant
Subsidiary of the Company or for any substantial part of the
property of the Company or Significant Subsidiary;
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary of the Company;
(or any similar relief is granted under any foreign laws) and the order
or decree remains unstayed and in effect for 60 days;
(viii) the rendering of any judgment or decree for the payment of
money in excess of $5.0 million against the Company or any Restricted
Subsidiary if such judgment or decree remains unpaid and outstanding for
a period of 60 days following such judgment and is not discharged, waived
or stayed within 60 days after such judgment or decree thereof; or
(ix) a Subsidiary Guarantee ceases to be in full force and effect
(other than in accordance with the terms of such Subsidiary Guarantee) or
a Subsidiary Guarantor denies or disaffirms its obligations under its
Subsidiary Guarantee and such default continues for 10 days.
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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.
The term "Bankruptcy Law" means Xxxxx 00, Xxxxxx Xxxxxx Code, as amended,
or any similar federal or state law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
A Default under clause (iii) or (iv) of this Section 6.1 is not an Event
of Default until the Trustee or the Holders of at least 25% in aggregate
principal amount of the outstanding Securities notify the Company of the
Default and the Company does not cure such Default within the time specified
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 of Default under clause (v) of this Section 6.1 and any event which
with the giving of notice or the lapse of time would become an Event of Default
under clause (iii), (iv) or (viii) of this Section 6.1, its status and what
action the Company is taking or proposes to take with respect thereto.
SECTION 6.2. Acceleration. If an Event of Default occurs and is
continuing, the Trustee by notice to the Company, or the Holders of at least
25% in aggregate principal amount of the outstanding Securities by notice to
the Company and the Trustee, may declare the principal of and accrued but
unpaid interest on all the Securities to be due and payable. Upon such a
declaration, such principal and interest shall be due and payable immediately.
If an Event of Default specified in Section 6.1(vi) or (vii) with respect to
the Company occurs and is continuing, the principal of and interest on all the
Securities will ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Securityholders.
The Holders of a majority in aggregate 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 ex-
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cept nonpayment of principal or interest that has become due solely because of
acceleration. No such rescission shall affect any subsequent Default or impair
any right consequent thereto.
SECTION 6.3. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are, to the extent
permitted by law, cumulative.
SECTION 6.4. Waiver of Past Defaults. The Holders of a majority in
aggregate principal amount of the Securities then outstanding by notice to the
Trustee may waive any past or existing Default and its consequences except (i)
a Default in the payment of the principal of or interest on a Security or (ii)
a Default in respect of a provision that under Section 9.2 cannot be amended
without the consent of each Securityholder affected. When a Default is waived,
it is deemed cured, and any Event of Default arising therefrom shall be deemed
to have been cured, but no such waiver shall extend to any subsequent or other
Default or impair any consequent right.
SECTION 6.5. Control by Majority. The Holders of a majority in aggregate
principal amount of the Securities then outstanding may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or of exercising any trust or power conferred on the Trustee. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture or, subject to Section 7.1, that the Trustee determines is unduly
prejudicial to the rights of other Securityholders or would involve the Trustee
in personal liability; provided, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action hereunder, the Trustee shall be entitled
to indemnification from the Securityholders satisfactory to it in its sole
discretion against all losses and expenses caused by taking or not taking such
action.
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SECTION 6.6. Limitation on Suits. Subject to Section 6.7 hereof, a
Securityholder may not pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding make a written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable security
or indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of security or indemnity; and
(5) the Holders of a majority in aggregate principal amount of the
Securities then outstanding do not give the Trustee a direction
inconsistent with the request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
SECTION 6.7. Rights of Holders To Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment
of principal, premium (if any) or interest on the Securities held by such
Holder, on or after the respective due dates expressed in the Securities, or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.8. Collection Suit by Trustee. If an Event of Default
specified in Section 6.1(i) or (ii) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or any other obligor upon the Securities for the whole amount then due
and owing (together with interest on any unpaid interest to the extent lawful)
and the amounts provided for in Section 7.7.
SECTION 6.9. Trustee May File Proofs of Claim. The Trustee may file such
proofs of claim and other papers or documents as may be necessary or advisable
in order to have the
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claims of the Trustee and the Securityholders allowed in any judicial
proceedings relative to the Company, its creditors or its property and, unless
prohibited by law or applicable regulations, may vote on behalf of the Holders
in any election of a trustee in bankruptcy or other Person performing similar
functions, and any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make 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 to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 7.7.
SECTION 6.10. Priorities. If the Trustee collects any money or property
pursuant to this Article 6, it shall pay out the money or property in the
following order, subject to applicable law:
FIRST: to the Trustee for amounts due under Section 7.7;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for principal (including any premium) and interest, ratably,
without preference or priority of any kind, according to the amounts due
and payable on the Securities for principal (including any premium) and
interest, respectively; and
THIRD: to the Company.
The Trustee may, upon prior written notice to the Company, fix a record
date and payment date for any payment to Securityholders pursuant to this
Section. At least 15 days before such record date, the Company shall mail to
each Securityholder and the Trustee a notice that states the record date, the
payment date and amount to be paid.
SECTION 6.11. Undertaking for Costs. In any suit for the enforcement of
any right or remedy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as Trustee, a court may in its discretion
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not ap-
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ply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.7 or a
suit by Holders of more than 10% in aggregate principal amount of the
outstanding Securities.
SECTION 6.12. Waiver of Stay or Extension Laws. The Company (to the
extent it may lawfully do so) shall 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
may affect the covenants or the performance of this Indenture; and the Company
(to the extent that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law, and shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been
enacted.
ARTICLE 7
TRUSTEE
SECTION 7.1. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise 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 such Person's
own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture and the TIA
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Indenture. However, in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished
to the Trustee, the Trustee shall
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examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of
this Section;
(2) the Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Sections 6.2 and 6.5 hereof.
(d) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur 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 to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(e) Every provision of this Indenture that in any way relates to
the Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section and
to the provisions of the TIA.
(f) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(g) The Trustee shall have no responsibility to examine or review
and shall have no liability for the contents of any documents submitted to or
delivered to any Holder of Securities by the Company in the nature of a
solicitation or an official statement or offering circular, whether preliminary
or final.
(h) 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 provisions of the TIA.
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SECTION 7.2. Rights of Trustee. Subject to Section 7.1:
(a) The Trustee may rely on any document including, without
limitation, any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, bond, note or coupon believed by
it to be genuine and to have been signed or presented by the proper
person. The Trustee need not investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in
reliance on the Officers' Certificate or Opinion of Counsel.
(c) The Trustee may execute any of the trusts or power hereunder or
perform any duties hereunder either directly or by or through agents and
shall not be responsible for the misconduct or gross negligence of any
agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within
its rights or powers; provided, however, that the Trustee's conduct does
not constitute willful misconduct or gross negligence.
(e) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to
this Indenture and the Securities shall be full and complete
authorization and protection from liability in respect to any action
taken, omitted or suffered by it hereunder in good faith and in
accordance with the advice or opinion of such counsel.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture, unless such
Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction.
(g) Except with respect to Section 4.1, the Trustee shall have no
duty to inquire as to the performance of the
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Company's covenants in Article 4. In addition, the Trustee shall not be
deemed to have knowledge of any Default of Event of Default except (i)
any Default or Event of Default occurring pursuant to Sections 6.1(i),
6.1(ii) and 4.1 or (ii) any Default or Event of Default of which a
responsible Officer of the Trustee shall have received written
notification or obtained actual knowledge.
SECTION 7.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its respective Affiliates with the
same rights it would have if it were not Trustee. Any Paying Agent, Registrar,
co-registrar or co-paying agent may do the same with like rights. However, the
Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.4. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for
any statement of the Company in this Indenture or the Securities or in any
document issued in connection with the sale of the Securities other than the
Trustee's certificate of authentication.
SECTION 7.5. Notice of Defaults. If a Default occurs and is
continuing and if it is known to a responsible Officer of the Trustee, the
Trustee shall mail to each Securityholder notice of the Default within 90 days
after it is known by a Trust Officer or written notice is received by the
Trustee. Except in the case of a Default in payment of principal of or
interest on any Security (including payments pursuant to the mandatory
redemption provisions of such Security, if any), the Trustee may withhold the
notice if and so long as its board of directors or a trust committee or
directors and/or responsible officers of the trustee in good faith determine
that withholding the notice is in the interests of Securityholders.
SECTION 7.6. Reports by Trustee to Holders. As promptly as
practicable after each May 15 beginning with the May 15 following the date of
this Indenture, and in any event prior to July 15 in each year, the Trustee
shall mail to each Securityholder a brief report dated as of May 15 that
complies with TIA Section 313(a). The Trustee also shall comply with TIA
Section Section 313(b), (c) and (d). Prior to delivery to the Holders, the
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Trustee shall deliver to the Company a copy of any report it delivers to
Holders pursuant to this Section 7.6.
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC 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 7.7. Compensation and Indemnity. The Company shall pay to the
Trustee from time to time such reasonable compensation for its services as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it in any capacity. The Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust. The
Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection,
in addition to such compensation for its services, except any such expense,
disbursement or advance as may arise from its negligence, willful misconduct or
bad faith. Such expenses shall include the reasonable compensation and
expenses, disbursements and advances of the Trustee's agents, counsel,
accountants and experts. The Trustee shall provide the Company reasonable
notice of any expenditure not in the ordinary course of business; provided that
prior approval by the Company of any such expenditure shall not be a
requirement for the making of such expenditure nor for reimbursement by the
Company thereof. The Company shall indemnify each of the Trustee and any
predecessor Trustees against any and all loss, damage, claim, liability or
expense (including attorneys' fees and expenses) (other than taxes applicable
to the Trustee's compensation hereunder) incurred by it in connection with the
acceptance or administration of this trust and the performance of its duties
hereunder. The Trustee shall notify the Company promptly of any claim for
which it may seek indemnity. Failure by the Trustee to so notify the Company
shall not relieve the Company of its obligations hereunder. The Company shall
defend the claim and the Trustee shall cooperate in the defense of such claim.
The Trustee may have separate counsel at its own expense. The Company need not
reimburse any expense or indemnify against any loss, liability or expense
incurred by the Trustee through the Trustee's own willful misconduct,
negligence or bad faith. The Company need not pay for any settlement made
without its written consent.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities
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on all money or property held or collected by the Trustee other than money or
property held in trust to pay principal of and interest on particular
Securities.
The Company's payment obligations pursuant to this Section shall
survive the discharge of this Indenture. When the Trustee incurs expenses
after the occurrence of a Default specified in Section 6.1(vi) or (vii) with
respect to the Company, the expenses are intended to constitute expenses of
administration under the Bankruptcy Law.
SECTION 7.8. Replacement of Trustee. The Trustee may resign at any
time upon 30 days notice to the Company. The Holders of a majority in
principal amount of the Securities then outstanding may remove the Trustee by
so notifying the Trustee and may appoint a successor Trustee. The Company
shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns, is removed by the Company or by the Holders of
a majority in principal amount of the Securities and such Holders do not
reasonably promptly appoint a successor Trustee, or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer
all property held by it as Trustee to the successor Trustee, subject to the
lien provided for in Section 7.7.
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If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this
Section, the Company's obligations under Section 7.7 shall continue for the
benefit of the retiring Trustee.
SECTION 7.9. Successor Trustee by Merger. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee, provided that such corporation
shall be eligible under this Article 7 and TIA Section 3.10(a).
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of
the successor to the Trustee; and in all such cases such certificates shall
have the full force which it is anywhere in the Securities or in this Indenture
provided that the certificate of the Trustee shall have.
SECTION 7.10. Eligibility; Disqualification. This Indenture shall
always have a Trustee, which shall at all times satisfy the requirements of TIA
Section Section 301(a)(1), 301(a)(2), 301(a)(4) and 301(a)(5). The Trustee
shall have a combined capital and surplus of at least $25,000,000 as set forth
in its most recent published annual report of condition. The Trustee shall
comply with TIA Section 310(b); provided, however, that there shall be
excluded from the operation of TIA Section 310(b)(1) any indenture or
indentures under which other securities or certifi-
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xxxxx of interest or participation in other securities of the Company are
outstanding if the requirements for such exclusion set forth in TIA Section
310(b)(1) are met. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 7.10, the Trustee shall resign
immediately in the manner and with the effect specified by this Article 7.
SECTION 7.11. Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.1. Discharge of Liability on Securities; Defeasance.
(a) When (i) the Company delivers to the Trustee all outstanding
Securities (other than Securities replaced pursuant to Section 2.7) for
cancellation or (ii) all outstanding Securities have become due and payable,
whether at maturity or as a result of the mailing of a notice of redemption
pursuant to Article 3 hereof, and, in each case of this clause (ii), the
Company irrevocably deposits or causes to be deposited with the Trustee United
States dollars or U.S. Government Obligations sufficient to pay and discharge
the entire indebtedness on the Securities not heretofore delivered to the
Trustee for cancellation, for the principal of, premium, if any, and interest
to the date of deposit (other than Securities replaced pursuant to Section
2.7), and if in either case the Company pays all other sums payable hereunder
by the Company, then this Indenture shall, subject to Section 8.1(c), cease to
be of further effect. The Trustee shall acknowledge satisfaction and discharge
of this Indenture on demand of the Company accompanied by an Officers'
Certificate from the Company that all conditions precedent provided for herein
relating to satisfaction and discharge of this Indenture have been complied
with and at the cost and expense of the Company.
(b) Subject to Sections 8.1(c) and 8.2, the Company at any time may
terminate (i) all of its obligations under the Securities and this Indenture
("legal defeasance option") or (ii) its obligations under Article 4 and the
operation of Sections 6.1(iii), 6.1(iv), 6.1(v), 6.1(vi) and 6.1(vii) (but only
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with respect to a Significant Subsidiary), 6.1(viii) and 5.1(iii) and 5.1(iv)
("covenant defeasance option"). The Company may exercise its legal defeasance
option notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default with respect
thereto. If the Company exercises its covenant defeasance option, payment of
the Securities may not be accelerated due to a failure to comply with Article 4
or the operation of Sections 6.1(iii), 6.1(iv), 6.1(v), 6.1(vi) and 6.1(vii)
(but only with respect to a Significant Subsidiary), or 6.1(viii) or because of
the failure of the Company to comply with 5.1(iii) and 5.1(iv). If the Company
exercises its legal defeasance option or its covenant defeasance option, each
Subsidiary Guarantor will be released from all of its obligations under Article
11.
Upon satisfaction of the conditions set forth herein and upon request
of the Company, the Trustee shall acknowledge in writing the discharge of those
obligations that the Company terminates.
(c) Notwithstanding clauses (a) and (b) above, the Company's
obligations in Sections 2.3, 2.4, 2.5, 2.6, 2.7, 7.7, 7.8, 8.3, 8.4, 8.5 and
8.6 shall survive until the Securities have been paid in full. Thereafter, the
Company's obligations in Sections 7.7, 8.4 and 8.5 shall survive.
SECTION 8.2. Conditions to Defeasance. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits or causes to be deposited in
trust (the "defeasance trust") with the Trustee money or U.S. Government
Obligations which through the scheduled payment of principal and interest
in respect thereof in accordance with their terms will provide cash at
such times and in such amounts as will be sufficient to pay principal and
interest when due on all outstanding Securities (except Securities
replaced pursuant to Section 2.7) to maturity or redemption, as the case
may be;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and without
reinvestment on the deposited U.S. Government Obligations plus any de-
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posited money without investment will provide cash at such times and in
such amounts as will be sufficient to pay principal and interest when due
on all outstanding Securities (except Securities replaced pursuant to
Section 2.7) to maturity or redemption, as the case may be;
(3) 91 days pass after the deposit is made and during the 91-day
period no Default specified in Section 6.1(vi) or (vii) with respect to
the Company occurs which is continuing at the end of the period;
(4) the deposit does not result in a breach of, or otherwise
constitute a default under any other agreement or investment with respect
to any Senior Indebtedness and no default exists under any Indebtedness;
(5) the Company delivers to the Trustee an Opinion of Counsel to the
effect that the trust resulting from the deposit does not constitute, or
is qualified as, a regulated investment company under the Investment
Company Act of 1940;
(6) the Company shall have delivered to the Trustee an Opinion of
Counsel stating that the Securityholders will not recognize income, gain
or loss for federal income tax purposes as a result of such deposit and
defeasance and will be subject to Federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such deposit and defeasance had not occurred (and, in the case of legal
defeasance only, such Opinion of Counsel must be based on a ruling of the
Internal Revenue Service or other change in applicable federal income tax
law);
(7) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel to the effect that
the Securityholders will not recognize income, gain or loss for federal
income tax purposes as a result of such covenant defeasance and will be
subject to federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such deposit and
covenant defeasance had not occurred;
(8) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent to the
defeasance and discharge
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of the Securities as contemplated by this Article 8 have been complied
with; and
(9) the Company shall have paid or duly provided for payment under
terms mutually satisfactory to the Company and the Trustee all amounts
then due to the Trustee pursuant to Section 7.7 hereof.
Opinions of Counsel required to be delivered under this Section may
have qualifications customary for opinions of the type required and counsel
delivering such Opinions of Counsel may rely on certificates of the Company or
government or other officials customary for opinions of the type required,
including certificates certifying as to matters of fact.
Before or after a deposit, the Company may make arrangements
satisfactory to the Trustee for the redemption of Securities at a future date
in accordance with Article 3.
SECTION 8.3. Application of Trust Money. The Trustee shall hold in
trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It shall apply the deposited money and the money from U.S.
Government Obligations either directly or through the Paying Agent (including
the Company acting as its own Paying Agent as the Trustee may determine) and in
accordance with this Indenture to the payment of principal of and interest on
the Securities.
SECTION 8.4. Repayment to Company. The Trustee and the Paying Agent
shall notify the Company of any excess money or Securities held by them at any
time and shall promptly turn over to the Company upon request any excess money
or securities held by them at any time.
Subject to any applicable abandoned property law, the Trustee and the
Paying Agent shall pay to the Company upon written request any money held by
them for the payment of principal or interest that remains unclaimed for two
years, and, thereafter, Securityholders entitled to the money must look to the
Company for payment as general creditors.
SECTION 8.5. Indemnity for Government Obligations. The Company shall
pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S. Government Obligations other than
any such tax, fee or other charge which by law is for the account of the
Holders of the defeased Securities; provided that the
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Trustee shall be entitled to charge any such tax, fee or other charge to such
Holder's account.
SECTION 8.6. Reinstatement. If the Trustee or Paying Agent is unable
to apply any money or U.S. Government Obligations in accordance with this
Article 8 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 obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article 8 until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article 8; provided, however, that, (a) if
the Company has made any payment of interest on or principal of any Securities
following the reinstatement of their 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 and (b) unless otherwise required by any legal proceeding or any
order or judgment of any court or governmental authority, the Trustee or Paying
Agent shall return all such money and U.S. Government Obligations to the
Company promptly after receiving a written request therefor at any time, if
such reinstatement of the Company's obligations has occurred and continues to
be in effect.
ARTICLE 9
AMENDMENTS
SECTION 9.1. Without Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without notice to or consent of any
Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, 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 as described in Section 163(f)(2)(B) of the Code;
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(4) to add Guarantees with respect to the Securities;
(5) to release Subsidiary Guarantors when permitted by this Indenture;
(6) to secure the Securities;
(7) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the
Company;
(8) to make any change that does not adversely affect the rights of
any Securityholder; or
(9) to comply with any requirements of the SEC in connection with
qualifying this Indenture under the TIA.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein,
shall not impair or affect the validity of an amendment under this section. No
amendment may be made to Article 10 hereof that adversely affects the rights of
any holder of Senior Indebtedness then outstanding unless the holder of such
Senior Indebtedness (or its Representative) consents to such change.
SECTION 9.2. With Consent of Holders. The Company and the Trustee may
amend this Indenture or the Securities without notice to any Securityholder but
with the written consent of the Holders of at least a majority in principal
amount of the Securities then outstanding. However, without the consent of
each Securityholder affected, an amendment may not:
(1) reduce the amount of Securities whose Holders must consent to an
amendment;
(2) reduce the rate of or extend the time for payment of interest on
any Security;
(3) reduce the principal of or change the Stated Maturity of any
Security;
(4) reduce the premium payable upon the redemption of any Security or
change the time at which any Security may be redeemed in accordance with
Article 3;
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(5) make any Security payable in money other than that stated in the
Security;
(6) impair the right of any Holder to institute suit for the
enforcement of any payment on or with respect to such Holder's Securities or
any Subsidiary Guarantee;
(7) make any change in the amendment provisions which require each
Holder's consent or in the waiver provisions; or
(8) make any change to the subordination provisions of this Indenture
that would adversely affect the Securityholders.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein,
shall not impair or affect the validity of an amendment under this Section.
SECTION 9.3. Compliance with Trust Indenture Act. Every amendment to
this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 9.4. Revocation and Effect of Consents and Waivers. A consent
to an amendment or a waiver by a Holder of a Security shall bind the Holder and
every subsequent Holder of that Security or portion of the Security that
evidences the same debt as the consenting Holder's Security, even if notation
of the consent or waiver is not made on the Security. An amendment or waiver
becomes effective once the requisite number of consents are received by the
Company or the Trustee. After an amendment or waiver becomes effective, it
shall bind every Securityholder.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Securityholders entitled to give their consent
or take any other action described above or required or permitted to be taken
pursuant to this Indenture. If a record date is fixed, then notwithstanding
the immediately preceding paragraph, those Persons who were
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Securityholders at such record date (or their duly designated proxies), and
only those Persons, shall be entitled to give such consent or to revoke any
consent previously given or to take any such action, whether or not such
Persons continue to be Holders after such record date. No such consent shall
be valid or effective for more than 120 days after such record date.
SECTION 9.5. Notation on or Exchange of Securities. If an amendment
changes the terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder.
Alternatively, if the Company or the Trustee so determine, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms. Failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment.
SECTION 9.6. Trustee To Sign Amendments. The Trustee shall sign any
amendment authorized pursuant to this Article 9 if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment
the Trustee shall be entitled to receive indemnity reasonably satisfactory to
it and to receive, and (subject to Section 7.1) shall be fully protected in
relying upon, an Officers' Certificate and an Opinion of Counsel stating that
such amendment complies with the provisions of Article 9 of this Indenture.
ARTICLE 10
SUBORDINATION OF THE SECURITIES
SECTION 10.1. Agreement To Subordinate. Notwithstanding any other
provision to the contrary in this Indenture, the Company covenants and agrees,
and each Holder by accepting a Security covenants and agrees, that the payment
of principal of, premium (if any) and interest on and all other Obligations
under or in connection with the Indebtedness now or hereafter evidenced by the
Securities, the Subsidiary Guarantees, this Indenture and/or related
agreements, documents or instruments is subordinate in right of payment, to the
extent and in the manner provided in this Article, to the prior payment in full
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of all Senior Indebtedness of the Company or the relevant Subsidiary Guarantor,
as the case may be, whether outstanding on the Issue Date or thereafter
incurred, including all Obligations of the Company and such Subsidiary
Guarantor under the Senior Credit Facility. The subordination provisions set
forth in this Article are for the benefit of, and shall be enforceable directly
by, the holders of Senior Indebtedness.
Each Holder authorizes and directs the Trustee on such Holder's behalf
to take such action as may be necessary or appropriate, in the sole discretion
of the Trustee, to acknowledge or effectuate the subordination between the
Holders and the holders of Senior Indebtedness of the Company as provided in
this Article and appoints the Trustee as such Holder's attorney-in-fact for any
and all such purposes, including, in the event of any voluntary or involuntary
liquidation or dissolution of the Company, whether total or partial, or in a
bankruptcy, reorganization, insolvency, receivership, dissolution, assignment
for the benefit of creditors, marshalling of assets or similar proceeding
relating to the Company or its property, the timely filing of a claim for the
unpaid balance of such Holder's Securities in the form required in said
proceeding and cause said claim to be approved. If the Trustee does not file a
proper claim or proof of debt in the form required in such proceeding prior to
20 days before the expiration of the time to file such claim or claims, then
the Representative is hereby authorized to have the right to file and is hereby
authorized to file an appropriate claim for and on behalf of the Holders;
provided, however, that any such claim filed by the Representative shall be
superseded by the claim, if any, subsequently filed by the Trustee.
Each Holder by accepting a Security acknowledges and agrees that the
subordination provision set forth in this Article are, and are intended to be,
an inducement and consideration to each holder of any Senior Indebtedness of
the Company, whether such Senior Indebtedness was created before or after the
issuance of the Securities, to acquire and continue to hold, or to continue to
hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be
deemed conclusively to have relied upon such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness, and such holder is made an obligee hereunder and may enforce
directly such subordination provisions.
SECTION 10.2. Liquidation; Dissolution; Bankruptcy. Upon any payment
or distribution of the assets of the Company of any kind or character, whether
in cash, property or securi-
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ties, to creditors upon a total or partial liquidation, winding up, assignment
for the benefit of creditors or marshalling of assets or other distribution in
a bankruptcy, insolvency receivership or dissolution or reorganization of or
similar proceeding relating to the Company or its property or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding:
(a) the holders of Senior Indebtedness of the Company shall be
entitled to receive payment in full in cash of such Senior Indebtedness
before Holders are entitled to receive any payment; and
(b) until the Senior Indebtedness of the Company is paid in full in
cash any payment or distribution to which Holders would be entitled but
for this Article shall be made to holders of such Senior Indebtedness, as
their interests may appear.
Upon any prepayment, payment or distribution referred to in this
Article, the Trustee and the Holders shall be entitled to rely upon any order
or decree of a court of competent jurisdiction in which such proceedings are
pending for the purpose of ascertaining the identity of Persons entitled to
participate in such payment or distribution, the holders of Senior
Indebtedness, the amount thereof or payable thereon and all other facts
pertinent thereto or to this Article, and the Trustee and the Holders shall be
entitled to rely upon a certificate of the liquidating trustee or agent or
other Person (including any Representative of holders of Senior Indebtedness of
the Company) making any payment or distribution to the Trustee or to the
Holders for the purpose of ascertaining the identity of Persons entitled to
participate in such payment or distribution, the holders of Senior
Indebtedness, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this
Article. 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 Section, the Trustee may requires such Person (at the expense of the
Holders) to furnish evidence to the reasonable satisfaction of the Trustee,
acting in good faith, as to the amount of such Senior Indebtedness held by such
Person, as to the extent to which such Person is entitled to participate in
such payment or distribution, and as to other facts pertinent to the rights of
such Person under this Section, and if such evidence is not furnished, the
Trustee may defer any payment to such Person
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pending judicial determination as to the right of such Person to receive
payment.
The consolidation or merger of the Company with or into any Person, or
the sale, assignment, transfer, lease, conveyance or other disposition of all
or substantially all of the Company's assets to any Person, upon the terms and
conditions set forth in Article 5, shall not be deemed to be liquidation,
dissolution or reorganization or similar proceeding relating to the Company for
purposes of this Section if the Person formed by or surviving such
consolidation or merger, or to which such sale, assignment, transfer, lease,
conveyance or other disposition is made, shall, as a part of such
consolidation, merger, sale, assignment, transfer, lease, conveyance or other
disposition, comply with the conditions set forth in Article 5.
If a payment or distribution is made to Holders that, due to the
subordination provisions, should not have been made to them, such Holders are
required to hold it in trust for the holders of Senior Indebtedness of the
Company and pay it over to them as their interests may appear.
SECTION 10.3. Default on Senior Indebtedness.
(a) If any Senior Indebtedness of the Company is not paid when due,
the Company may not: (i) pay principal of, premium (if any) or interest on the
Securities or any other obligations under or in connection with the Securities,
this Indenture and/or any related agreements, documents or instruments; (ii)
make any deposit pursuant to Article 8; or (iii) repurchase, redeem or
otherwise retire any Securities (collectively "pay the Subordinated Debt")
unless the default shall have been cured or waived or such Senior Indebtedness
has been paid in full in cash.
(b) If any default on any Senior Indebtedness of the Company (other
than as set forth in Section 10.3(a)) occurs and the maturity of such Senior
Indebtedness is accelerated in accordance with its terms, the Company may not
pay the Subordinated Debt, unless the default shall have been cured or waived
and any such acceleration has been rescinded or such Senior Indebtedness has
been paid in full in cash.
(c) Notwithstanding Sections 10.3(a) and (b), the Company may pay the
Subordinated Debt 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
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forth in Sections 10.3(a) and (b) has occurred and is continuing. During the
continuance of any default (other than a default described in Sections 10.3(a)
and (b)) with respect to any Designated Senior Indebtedness of the Company
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 upon the expiration of any applicable grace periods, the
Company may not pay the Subordinated Debt 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 in cash). Notwithstanding the provisions described in
the immediately preceding sentence, unless the holders of such Designated
Senior Indebtedness or the Representative of such holders has accelerated the
maturity of such Designated Senior Indebtedness, the Company may resume
payments on the Securities after the end of such Payment Blockage Period. The
Securities shall not be subject to more than one Payment Blockage Period in any
consecutive 360-day period, irrespective of the number of such nonpayment
defaults with respect to Designated Senior Indebtedness during such period.
(d) The Company covenants that it will, upon request of the Trustee,
deliver an Officers' Certificate (with copies thereof to the Representative of
each class of Senior Indebtedness of the Company) showing in reasonable detail
the Senior Indebtedness outstanding as of the date of such Officers'
Certificate and the Representative of each class of Senior Indebtedness. The
Trustee may conclusively rely thereon except to the extent that it shall have
received, from the Representative of any class of Senior Indebtedness, notice
in writing controverting any of the statements made therein. Not less than 10
days prior to making any distribution in respect of Senior Indebtedness
pursuant to this Section, the Trustee shall deliver to each Representative of
any class of Senior Indebtedness copies of the most recent Officers'
Certificate filed with it by the Company pursuant to this subsection (d).
(e) In the event that the Securities are declared due and payable
before their Stated Maturity in accordance with
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Article 6, then and in such event the holders of Senior Indebtedness
outstanding at the time the Securities so become due and payable shall be
entitled to receive payment in full in cash of all amounts due or to become due
on or in respect of such Senior Indebtedness (whether or not an event of
default has occurred thereunder or such Senior Indebtedness is, or has been
declared to be, due and payable prior to the date on which it otherwise would
have become due and payable) before the Holders shall be entitled to receive
any Security Payment.
SECTION 10.4. Payment of Subordinated Debt Permitted if No Default.
Nothing contained in this Article or elsewhere in this Indenture, or in any of
the Securities, shall prevent the Company or any Person acting on behalf of the
Company, at any time except as otherwise provided in Section 10.2 from paying
the Subordinated Debt.
SECTION 10.5. Notices by the Company. The Company shall give prompt
written notice in the form of an Officers' Certificate, notify the Trustee,
each Paying Agent and the Representative of any facts known to the Company that
would cause a payment on the Subordinated Debt to violate this Article, but
failure to give such notice shall not affect the subordination provided in this
Article of the Securities to Senior Indebtedness. Without limiting the
foregoing, if payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify the Representative of the
acceleration.
SECTION 10.6. Subrogation. After all Senior Indebtedness is
irrevocably and indefeasibly paid in full in cash and until the Securities are
paid in full, Holders shall be subrogated to the rights of holders of Senior
Indebtedness to receive distributions applicable to Senior Indebtedness to the
extent that distributions otherwise payable to Holders have been applied to the
payment of Senior Indebtedness. A distribution made under this Article to
holders of Senior Indebtedness which otherwise would have been made to Holders
is not, as between the Company and the Holders, payment by the Company on
Senior Indebtedness.
SECTION 10.7. Relative Rights. This Article defines the relative
rights of Holders and holders of Senior Indebtedness. Nothing in this
Indenture shall:
(a) impair, as between the Company and the Holders, the obligation of
the Company, which is absolute and un-
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conditional, to pay the principal of, premium (if any) and interest on
the Securities in accordance with their terms;
(b) affect the relative rights of Holders and creditors of the
Company other than holders of Senior Indebtedness; or
(c) prevent the Trustee or any Holder from exercising its available
remedies upon a Default or Event of Default, subject to the rights of
holders of Senior Indebtedness to receive prepayment, payments and
distributions otherwise payable to Holders.
If the Company fails because of this Article to pay the principal of,
premium (if any) or interest on a Security on the due date or upon the
acceleration thereof, the failure is still a Default or Event of Default.
SECTION 10.8. Subordination May Not Be Impaired by the Company. No
right of any holder of Senior Indebtedness of the Company to enforce the
subordination of the Indebtedness evidenced by the Securities shall be impaired
by (a) any act or failure to act by the Company or by its failure to comply
with this Indenture, (b) any release of any collateral or any guarantor or any
Person of the Company's obligations under the Senior Indebtedness, (c) any
amendment, supplement, extension, renewal, restatement or other modification of
the Senior Indebtedness, (d) any settlement or compromise of any Senior
Indebtedness, (e) the unenforceability of any of the Senior Indebtedness or (f)
the failure of any holder of Senior Indebtedness to pursue claims against the
Company. The terms of the subordination provisions contained in this Article
10 will not apply to payments from money or the proceeds of U.S. Government
Obligations held in trust by the Trustee for the payment of principal of and
interest on the Securities pursuant to and in accordance with the provisions
described in Article 8.
SECTION 10.9. Distribution of Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of the Company, the distribution may be made and the notice given to their
Representative (if any).
SECTION 10.10. Rights of Trustee and Paying Agent. The Trustee or any
Payment Agent may continue to make payments in respect of the Securities and
shall not be charged with knowledge of the existence of facts that would
prohibit the making of any such payment unless, not less than three Business
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Days prior to the date of any such payment, a Responsible Officer of the
Trustee receives written notice reasonably satisfactory to it that payments in
respect of the Securities may not be made under this Article. Only the
Company, a Representative (satisfactorily identified to the Trustee) or a
holder of a class of Senior Indebtedness that has no Representative
(satisfactorily identified to the Trustee) may give the notice. Prior to the
receipt of such notice, the Trustee and any Paying Agent shall be entitled in
all respects to assume that no such facts exist. In any case, the Trustee
shall have no responsibility to the holders of Senior Indebtedness for payments
made to Holders by the Company or any Paying Agent unless cash payments are
made at the direction of the Trustee after receipt of such notice referred to
above.
Neither the Trustee nor any Payment Agent shall be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. With
respect to the holders of Senior Indebtedness, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article 10, 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 liable to
any holder of Senior Indebtedness if it shall mistakenly pay over or deliver to
Holders, the Company or any other Person moneys or assets to which any holder
of Senior Indebtedness shall be entitled by virtue of this Article 10 or
otherwise.
SECTION 10.11. Consent of Holders of Senior Indebtedness. The
provisions of this Article (including the definitions contained in this Article
and references to this Article contained in this Indenture) shall not be
amended, waived or modified in a manner that would adversely affect the rights
of the holders of any Senior Indebtedness of the Company, and no such
amendment, waiver or modification shall become effective, unless the holders of
such Senior Indebtedness shall have consented in writing (in accordance with
the provisions of the agreement governing such Senior Indebtedness) to such
amendment, waiver or modification.
SECTION 10.12. Contractual Subordination. This Article 10 represents
a bona fide agreement of contractual subor-
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dination pursuant to Section 510(b) of the United States Bankruptcy Code.
ARTICLE 11
SUBSIDIARY GUARANTEES
SECTION 11.1. Guarantees. Each Subsidiary Guarantor hereby
irrevocably and unconditionally guarantees, jointly and severally, to each
Holder and to the Trustee and its successors and assigns the full and punctual
payment of principal of, premium, if any, and interest on the Securities when
due, whether at Stated Maturity, by acceleration or otherwise, and all other
obligations of the Company under this Indenture and the Securities (all the
foregoing being hereinafter collectively called the "Guaranteed Obligations").
Each Subsidiary Guarantor further agrees that the Guaranteed Obligations may be
extended or renewed, in whole or in part, without notice or further assent from
such Subsidiary Guarantor and that such Subsidiary Guarantor will remain bound
under this Article 11 notwithstanding any extension or renewal of any
Guaranteed Obligation.
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
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 agreement 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 Guaranteed Obligations; or (f) any change in the
ownership of such Subsidiary Guarantor.
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.
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Each Subsidiary Guarantee is, to the extent and in the manner set forth
in Article 12, subordinated and subject in right of payment to the prior
payment in full of the principal of and premium, if any, and interest on all
Senior Indebtedness of the Subsidiary Guarantor giving such Subsidiary
Guarantee and each Subsidiary Guarantee is made subject to such provisions of
this Indenture.
Except as expressly set forth in Sections 8.2, 11.2 and 11.6, 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 Guaranteed 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 Subsidiary Guarantor or would otherwise
operate as a discharge of such Subsidiary Guarantor as a matter of law or
equity.
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, premium, if any, 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.
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, premium, if any, or interest on any 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
Hold-
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ers 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 to the Holders and the Trustee.
Each Subsidiary Guarantor agrees that it shall not be entitled to any
right of subrogation in respect of any Guaranteed Obligations guaranteed hereby
until payment in full of all Guaranteed Obligations and all obligations to
which the Guaranteed Obligations are subordinated as provided in Article 12.
Each Subsidiary Guarantor further 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 hereby may be accelerated as provided in Article 6 for
the purposes of such Subsidiary Guarantor's Subsidiary Guarantee herein,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Obligations guaranteed hereby, and (y) in the
event of any declaration of acceleration of such Obligations as provided in
Article 6, such Obligations (whether or not due and payable) shall forthwith
become due and payable by such Subsidiary Guarantor for the purposes of this
Section.
Each Subsidiary Guarantor also agrees to pay any and all costs and
expenses (including reasonable attorneys' fees) incurred by the Trustee or any
Holder in enforcing any rights under this Section.
SECTION 11.2. Limitation on Liability. Any term or provision of this
Indenture to the contrary notwithstanding, the maximum aggregate amount of the
obligations guaranteed hereunder by any Subsidiary Guarantor shall not exceed
the maximum amount that can be hereby guaranteed without rendering this
Indenture, as it relates to such Subsidiary Guarantor, voidable under
applicable law relating to fraudulent conveyance or fraudulent transfer or
similar laws affecting the rights of creditors generally. To effectuate the
foregoing intention, the obligations of each Subsidiary Guarantor shall be
limited to the maximum amount as will, after giving effect to all other
contingent and fixed liabilities of such Subsidiary Guarantor and after giving
effect to any collections from or payments made by or on behalf of any other
Subsidiary Guarantor in respect of the obligations of such other Subsidiary
Guarantor under its Subsidiary Guarantee or pursuant to its contribution
obligations hereunder, result in the obligations of such Subsidiary Guarantor
under its Subsidiary Guarantee not constituting a fraudulent conveyance or
fraudulent transfer under fed-
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eral, state or foreign law. Each Subsidiary Guarantor that makes a payment or
distribution under a Subsidiary Guarantee shall be entitled to a contribution
from each other Subsidiary Guarantor in an amount based on the consolidated net
worth of each Subsidiary Guarantor.
SECTION 11.3. Successors and Assigns. This Article 11 shall be
binding upon each Subsidiary Guarantor and its successors and assigns and shall
enure to the benefit of the successors and assigns of the Trustee and the
Holders and, in the event of any transfer or assignment of rights by any Holder
or the Trustee, the rights and privileges conferred upon that party in this
Indenture and in the Securities shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions of this
Indenture.
SECTION 11.4. 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 11 shall operate as a waiver thereof, nor 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 11
at law, in equity, by statute or otherwise.
SECTION 11.5. Modification. No modification, amendment or waiver of
any provision of this Article 11, 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 purpose 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 circumstances.
SECTION 11.6. Release of Subsidiary Guarantor. A Subsidiary Guarantor
may, by execution and delivery to the Trustee of a supplemental indenture
satisfactory to the Trustee, be released from its Guarantee upon the sale of
all of its Capital Stock, or all or substantially all of the assets of the
applicable Subsidiary Guarantor, to any Person that is not a Subsidiary of the
Company, if such sale is made in compliance with this Indenture.
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SECTION 11.7. Execution of Supplemental Indenture for Future
Subsidiary Guarantors. Each Subsidiary which is required to become a
Subsidiary Guarantor pursuant to Section 4.16 shall, and the Company shall
cause each such Subsidiary to, promptly execute and deliver to the Trustee a
supplemental indenture in the form of Exhibit E hereto pursuant to which such
Subsidiary shall become a Subsidiary Guarantor under this Article 11 and shall
guarantee the Obligations. Concurrently with the execution and delivery of
such supplemental indenture, the Company shall deliver to the Trustee an
Opinion of Counsel to the effect that such supplemental indenture has been duly
authorized, executed and delivered by such Subsidiary and that, subject to the
application of bankruptcy, insolvency, moratorium, fraudulent conveyance or
transfer and other similar laws relating to creditors' rights generally and to
the principles of equity, whether considered in a proceeding at law or in
equity, the Subsidiary Guarantee of such Subsidiary Guarantor is a legal, valid
and binding obligation of such Subsidiary Guarantor, enforceable against such
Subsidiary Guarantor in accordance with its terms.
ARTICLE 12
SUBORDINATION OF SUBSIDIARY GUARANTEES
SECTION 12.1. Agreement To Subordinate. Notwithstanding any other
provision to the contrary in this Indenture, each Subsidiary Guarantor
covenants and agrees, and each Holder by accepting a Security covenants and
agrees, that all payments by such Subsidiary Guarantor in respect of its
Subsidiary Guarantee are subordinated in right of payment, to the extent and in
the manner provided in this Article, to the prior payment in full of all Senior
Indebtedness of such Subsidiary Guarantor, whether outstanding on the Issue
Date or thereafter incurred, including all Obligations of the Company and such
Subsidiary Guarantor under the Senior Credit Facility. The subordination
provisions set forth in this Article are for the benefit of, and shall be
enforceable directly by, the holders of Senior Indebtedness.
Each Holder authorizes and directs the Trustee on such Holder's behalf
to take such action as may be necessary or appropriate, in the sole discretion
of the Trustee, to acknowledge or effectuate the subordination between the
Holders and the holders of Senior Indebtedness of each subsidiary Guarantor as
provided in this Article and appoints the Trustee as such Holder's
attorney-in-fact for any and all such proposes, including, in the event of any
voluntary or involuntary liquida-
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tion or dissolution of a Subsidiary Guarantor, whether total or partial, or in
a bankruptcy, reorganization, insolvency, receivership, dissolution, assignment
for the benefit of creditors, marshalling of assets or similar proceeding
relating to a Subsidiary Guarantor or its property, the timely filing of a
claim for the unpaid balance of such Holder's Securities in the form required
in said proceeding and cause said claim to be approved. If the Trustee does
not file a property claim or proof to debt in the form required in such
proceeding prior to 20 days before the expiration of the time to exile such
claim or claims, then the Representative is hereby authorized to have the right
to file and is hereby authorized to file an appropriate claim for and on behalf
of the Holders; provided, however, that any such claim filed by such
Representative shall be superseded by the claim, if any, subsequently filed by
the Trustee.
Each Holder by accepting a Security acknowledges and agrees that the
subordination provisions set forth in this Article are, and are intended to be,
an inducement and consideration to each holder of Senior Indebtedness of each
Subsidiary Guarantor, whether such Senior Indebtedness was created before or
after the issuance of the Securities, to acquire and continue to hold, or to
continue to hold, such Senior Indebtedness, and such holder of Senior
Indebtedness shall be deemed conclusively to have relied upon such
subordination provisions in acquiring and continuing to hold, or in continuing
to hold, such Senior Indebtedness, and such holder is made an obligee hereunder
and may enforce directly such subordination provisions.
SECTION 12.2. Liquidation; Dissolution; Bankruptcy. Upon any payment
or distribution of the assets of any Subsidiary Guarantor of any kind or
character, whether in cash, property or securities, to creditors upon a total
or partial liquidation or dissolution or reorganization or similar proceeding
relating to such Subsidiary Guarantor or its property or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding:
(a) the holders of Senior Indebtedness of such Subsidiary Guarantor
shall be entitled to receive payment in full in cash of such Senior
Indebtedness before Holders are entitled to receive any payment; and
(b) until the Senior Indebtedness of such Subsidiary Guarantor is
paid in full, any payment or distribution to which Holders would be
entitled but for this Article shall
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be made to holders of Senior Indebtedness of such Subsidiary Guarantor,
as their interests may appear.
Upon any payment or distribution referred to in this Article, the
Trustee and the Holders shall be entitled to rely upon any order or decree of a
court of competent jurisdiction in which such proceedings are pending for the
purpose of ascertaining the identity of Persons entitled to participate in such
payment or distribution, the holders of Senior Indebtedness, the amount thereof
or payable thereon and all other facts pertinent thereto or to this Article,
and the Trustee and the Holders shall be entitled to rely upon a certificate of
the liquidating trustee or agent or other Person (including any Representative
of holders of Senior Indebtedness of such Subsidiary Guarantor) making any
payment or distribution to the Trustee or to the Holders for the purpose of
ascertaining the identity of Persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article. 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 Section, the Trustee may request such Person
(at the expense of the Holders) to furnish evidence to the reasonable
satisfaction of the Trustee, acting in good faith, as to the amount of such
Senior Indebtedness held by such Person, as to the extent to which such Person
is entitled to participate in such payment or distribution, and as to the other
facts pertinent to the rights of such Person under this Section, 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
payment.
The consolidation or merger of a Subsidiary Guarantor with or into any
Person, or the sale, assignment, transfer, lease, conveyance or other
disposition of all or substantially all of such Subsidiary Guarantor's assets
to any Person, in compliance with the terms and conditions set forth in
Sections 5.1 and 5.2, shall not be deemed to be a liquidation, dissolution or
reorganization or similar proceeding relating to such Subsidiary Guarantor for
purposes of this Section.
SECTION 12.3. Default on Senior Indebtedness.
(a) If any Senior Indebtedness of a Subsidiary Guarantor is not paid
when due, such Subsidiary Guarantor may not
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pay the Subordinated Debt unless the default shall have been cured or waived or
such Senior Indebtedness has been paid in full.
(b) If any default on any Senior Indebtedness of a Subsidiary
Guarantor (other than as set forth in Section 12.3(a)) occurs and such Senior
Indebtedness is accelerated in accordance with its terms, such Subsidiary
Guarantor may not pay the Subordinated Debt unless the default shall have been
cured or waived and any such acceleration has been rescinded or such Senior
Indebtedness has been paid in full in cash.
(c) Notwithstanding Sections 12.3(a) and (b), the Subsidiary
Guarantors may pay the Subordinated Debt without regard to the foregoing if the
Subsidiary Guarantors 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 Sections 12.3(a) and (b) has occurred
and is continuing. During the continuance of any default (other than a default
described in Sections 12.3(a) and (b)) with respect to any Senior Indebtedness
of a Subsidiary Guarantor 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 Subsidiary Guarantors may not pay the Subordinated Debt for the
Payment Blockage Period commencing upon the receipt by the Trustee (with a copy
to the Subsidiary Guarantors) of a Blockage Notice from the Representative of
the holders of such Designated Senior Indebtedness specifying an election to
effect a Payment Blockage Period and ending 180 days thereafter (or earlier if
such Payment Blockage Period is terminated (i) by written notice to the Trustee
and the Subsidiary Guarantor from the Person or Persons who gave such Blockage
Notice, (ii) because the default giving rise to such Blockage Notice has been
waived in writing or (iii) because such Designated Senior Indebtedness has been
repaid in full in cash). Notwithstanding the provisions described in the
immediately preceding sentence, unless the holders of such Designated Senior
Indebtedness or the Representative of such holders has accelerated the maturity
of such Designated Senior Indebtedness, the Subsidiary Guarantor may resume
payments on the Securities after the end of such Payment Blockage Period. The
Securities shall not be subject to more than one Payment Blockage Period in any
consecutive 360-day period, irrespective of the number of such nonpayment
defaults with respect to Designated Senior Indebtedness during such period.
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(d) Each Subsidiary Guarantor covenants that it will, upon request of
the Trustee, deliver an Officers' Certificate (with copies thereof to the
Representative of each class of Senior Indebtedness of such Subsidiary
Guarantor) showing in reasonable detail the Senior Indebtedness outstanding as
of the date of such Officers' Certificate and the Representative of each class
of such Senior Indebtedness. The Trustee may conclusively rely thereon except
to the extent that it shall have received, from the Representative of any class
of such Senior Indebtedness, notice in writing controverting any of the
statements made therein. Not less than 10 days prior to making any
distribution in respect of Senior Indebtedness pursuant to this Section, the
Trustee shall deliver to each Representative of any class of such Senior
Indebtedness copies of the most recent Officers' Certificate filed with it by
such Subsidiary Guarantor pursuant to this subsection (d).
(e) In the event that the Securities are declared due and payable
before their Stated Maturity in accordance with Article 6, then and in such
event the holders of Senior Indebtedness of any Subsidiary Guarantor
outstanding at the time the Securities so become due and payable shall be
entitled to receive payment in full in cash of all amounts due or to become due
on or in respect of such Senior Indebtedness (whether or not an Event of
Default has occurred thereunder or the Senior Indebtedness of such Subsidiary
Guarantor is, or has been declared to be, due and payable prior to the date on
which it otherwise would have become due and payable) before the Holders shall
be entitled to receive any Security Payment.
SECTION 12.4. Payments of Subordinated Debt Permitted if No Default.
Nothing contained in this Article or elsewhere in this Indenture, or in any of
the Securities, shall prevent a Subsidiary Guarantor or any Person acting on
behalf of a Subsidiary Guarantor, at any time except as otherwise provided in
Section 12.2 or 12.3, from paying the Subordinated Debt.
SECTION 12.5. Notices by a Subsidiary Guarantor. Each Subsidiary
Guarantor shall promptly notify the Trustee, each Paying Agent and the
Representative of any facts known to such Subsidiary Guarantor that would cause
a payment on the Subordinated Debt to violate this Article, but failure to give
such notice shall not affect the subordination provided in this Article of any
Subsidiary Guarantee to holders of Senior Indebtedness of such Subsidiary
Guarantor. Without limiting the foregoing, if payment of the Securities is
accelerated because
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of an Event of Default, the Subsidiary Guarantors shall promptly notify the
Representative of the acceleration.
SECTION 12.6. Subrogation. After all Senior Indebtedness is
irrevocably and indefeasibly paid in full in cash and until the Securities are
paid in full, Holders shall be subrogated to the rights of holders of Senior
Indebtedness of the respective Subsidiary Guarantors to receive distributions
applicable to Senior Indebtedness to the extent that distributions otherwise
payable to Holders have been applied to the payment of Senior Indebtedness. A
distribution made under this Article to holders of Senior Indebtedness which
otherwise should have been made to Holders is not, as between a Subsidiary
Guarantor and the Holders, payment by such Subsidiary Guarantor on Senior
Indebtedness.
SECTION 12.7. Relative Rights. This Article defines the relative
rights of Holders and holders of Senior Indebtedness of the Subsidiary
Guarantors. Nothing in this Indenture shall:
(a) impair, as between a Subsidiary Guarantor and the Holders, the
obligation of a Subsidiary Guarantor, which is absolute and
unconditional, to make any payment in accordance with the terms of its
Subsidiary Guarantee;
(b) affect the relative rights of Holders and creditors of a
Subsidiary Guarantor other than holders of Senior Indebtedness of such
Subsidiary Guarantor; or
(c) prevent the Trustee or any Holder from exercising its available
remedies upon a Default or Event of Default, subject to the rights of
holders of Senior Indebtedness to receive prepayment, payments and
distributions otherwise payable to Holders.
If a Subsidiary Guarantor fails because of this Article to pay the
principal of (or premium, if any) or interest on a Security on the due date or
upon the acceleration thereof, the failure is still a Default or Event of
Default.
SECTION 12.8. Subordination May Not Be Impaired by the Subsidiary
Guarantor. No right of any holder of Senior Indebtedness to enforce the
subordination of the Obligation of a Subsidiary Guarantor pursuant to its
Subsidiary Guarantee shall be impaired by (a) any act or failure to act by such
Subsidiary Guarantor or by its failure to comply with this Indenture, (b) any
release of any collateral or any guarantor or any Per-
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son or such Subsidiary Guarantor's obligations under Senior Indebtedness, (c)
any amendment, supplement, extension, renewal, restatement or other
modification of any Senior Indebtedness, (d any settlement or compromise of
any Senior Indebtedness, (e) the unenforceability of any of the Senior
Indebtedness or (f) the failure of any holder of Senior Indebtedness to pursue
claims against such Subsidiary Guarantor. The terms of the subordination
provisions contained in this Article 12 will not apply to payments from money
or the proceeds of U.S. Government Obligations held in trust by the Trustee for
the payment of principal of and interest on the Securities pursuant to and in
accordance with the provisions described in Article 8.
SECTION 12.9. 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 (if
any).
SECTION 12.10. Rights of Trustee and Paying Agent. The Trustee or any
Paying Agent may continue to make payments in respect of the Securities and
shall not be charged with knowledge of the existence of facts that would
prohibit the making of any such payment unless, not less than three Business
Days prior to the date of any such payment, a Responsible Officer of the
Trustee receives written notice reasonably satisfactory to it that payments in
respect of the Securities may not be made under this Article. Only a
Subsidiary Guarantor, a Representative (satisfactorily identified to the
Trustee) or a holder of a class of Senior Indebtedness that has no
Representative (satisfactorily identified to the Trustee) may give the notice.
Prior to the receipt of such notice, the Trustee and any Paying Agent shall be
entitled in all respects to assume that no such facts exist. In any case, the
Trustee shall have no responsibility to the holders of Senior Indebtedness for
payments made to Holders by a Subsidiary Guarantor or any Paying Agent unless
such payments are made at the direction of the Trustee after receipt of such
notice referred to above.
Neither the Trustee nor any Paying Agent shall be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness. With respect to the
holders of Senior Indebtedness, the Trustee undertakes to perform or to observe
only such of its covenants and obligations as are specifically set forth in
this Article 12, 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 liable to any holders of Senior Indebtedness
if it shall mistakenly pay over or deliver to Holders, the Company or
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any other Person moneys or assets to which any holder of Senior Indebtedness
shall be entitled by virtue of this Article 12 or otherwise.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee.
This Section is solely for the benefit of the Trustee and any Paying
Agents and shall not limit the obligations of the Holders.
SECTION 12.11. Consent of Holders of Senior Indebtedness. The
provisions of this Article (including the definitions contained in this Article
and references to this Article contained in this Indenture) shall not be
amended, waived or modified in a manner that would adversely affect the rights
of the holders of any Senior Indebtedness of the Subsidiary Guarantors, and no
such amendment, waiver or modification shall become effective, unless the
holders of such Senior Indebtedness shall have consented in writing (in
accordance with the provisions of the Agreement governing such Senior
Indebtedness) to such amendment, waiver or modification.
SECTION 12.12. Contractual Subordination. This Article represents a
bona fide agreement of contractual subordination pursuant to Section 510(b) of
the United States Bankruptcy Code.
ARTICLE 13
MISCELLANEOUS
SECTION 13.1. Trust Indenture Act Controls. If any provision of this
Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control. If this Indenture excludes any provision of the TIA that is
required to be included, such provision shall be deemed included herein.
SECTION 13.2. Notices. Any notice or communication shall be in
writing and delivered in person, by overnight courier or facsimile (if to the
Company, with receipt confirmed by an Officer) or mailed by first-class mail
addressed as follows:
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If to the Company or any Subsidiary Guarantor:
MSX International Inc.
000 Xxx Xxxxxxxxx
Xxxxxx Xxxxx, XX 00000
Attention:
If to the Trustee:
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed first class, postage pre-paid to a
Securityholder, including any notice delivered in connection with TIA Section
Section 310(b), 313(c), 314(a) and 315(b), shall be sent to the Securityholder
at the Securityholder's address as it appears on the registration books of the
Registrar and shall be sufficiently given if so sent within the time
prescribed. To the extent required by the TIA, any notice or communication
shall also be mailed to any Person described in TIA Section 313(c).
Failure to send a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is sent in the manner provided
above, it is duly given, whether or not the addressee receives it.
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.
SECTION 13.3. Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c). With respect to the disclosure of any
information as to the names and addresses of the Securityhold-
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ers, the Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under TIA Section 312(b).
SECTION 13.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take or
refrain from taking any action under this Indenture, the Company shall furnish
to the Trustee to the extent required by the TIA or this Indenture:
(1) an Officers' Certificate (which in connection with the original
issuance of the Securities need only be executed by one Officer for the
Company) in form and substance reasonably satisfactory to the Trustee
stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 13.5. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him 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 or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 13.6. When Securities Disregarded. In determining whether the
Holders of the required principal amount
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of Securities have concurred in any direction, waiver or consent, Securities
owned by the Company or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company shall
be disregarded and deemed not to be outstanding, except that, for the purpose
of determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities which the Trustee actually knows
are so owned shall be so disregarded. Also, subject to the foregoing, only
Securities outstanding at the time shall be considered in any such
determination.
SECTION 13.7. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Trustee shall provide the Company reasonable notice of
such rules. The Registrar and the Paying Agent may make reasonable rules for
their functions.
SECTION 13.8. Legal Holidays. If a payment date is a Legal Holiday,
payment shall be made on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period. If a regular record
date is a Legal Holiday, the record date shall not be affected.
SECTION 13.9. Governing Law. This Indenture and the Securities shall
be governed by, and construed in accordance with, the laws of the State of New
York without giving effect to applicable principles of conflict of laws to the
extent that the application of the laws of another jurisdiction would be
required thereby.
SECTION 13.10. No Recourse Against Others. No recourse for the
payment of the principal of, premium, if any, or interest on any of the
Securities or for any claim based thereon or otherwise in respect thereof, and
no recourse under or upon any obligation, covenant or agreement of the Company
in this Indenture, or in any of the Securities or because of the creation of
any Indebtedness represented hereby and thereby, shall be had against any
incorporator, stockholder, officer, director, employee or controlling person of
the Company or any Successor Person thereof. Each Holder, by accepting a
Security, waives and releases all such liability. The waiver and release shall
be part of the consideration for the issuance of the Securities.
SECTION 13.11. Successors. All agreements of the Company in this
Indenture and the Securities shall bind the
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Company's successors. All agreements of the Trustee in this Indenture shall
bind its successors.
SECTION 13.12. Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Indenture.
SECTION 13.13. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not
intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
SECTION 13.14. Severability 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.
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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
MSX INTERNATIONAL, INC.
By:
---------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Executive Vice President
GEOMETRIC RESULTS INCORPORATED
By:
---------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Secretary
MSX INTERNATIONAL ENGINEERING
SERVICES, INC.
By:
---------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Vice President
MSX INTERNATIONAL BUSINESS
SERVICES, INC.
By:
---------------------------
Name: Xxxxxx Xxxxxxx
Title: President
MSX INTERNATIONAL (USA), INC.
By:
---------------------------
Name: Xxxxxxxxx Xxxxxxx
Title: Vice President
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MSX INTERNATIONAL (HOLDINGS), INC.
By:
---------------------------
Name:
Title:
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TRUSTEE:
IBJ XXXXXXXX BANK & TRUST
COMPANY, as Trustee
By:
---------------------------
Name:
Title:
120
SCHEDULE I
Existing Affiliate Transactions
121
EXHIBIT A
FACE OF SECURITY
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, 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 NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. TRANSFERS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES
OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY
OF THE ISSUANCE HEREOF (OR A PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER
THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF
THIS SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S
UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON
THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), AND, IF SUCH
TRANSFER IS BEING EFFECTED BY CERTAIN TRANSFERORS SPECIFIED IN THE INDENTURE
(AS DEFINED BELOW) PRIOR TO THE EXPIRATION OF THE "40 DAY RESTRICTED
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PERIOD" (WITHIN THE MEANING OF RULE 903(c)(3) OF REGULATION S UNDER THE
SECURITIES ACT), A CERTIFICATE WHICH MAY BE OBTAINED FROM THE COMPANY OR THE
TRUSTEE IS DELIVERED BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE, (4) TO
AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY
THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY)
THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION, AND A CERTIFICATE IN THE FORM ATTACHED TO THIS SECURITY IS
DELIVERED BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE (PROVIDED THAT
CERTAIN HOLDERS SPECIFIED IN THE INDENTURE MAY NOT TRANSFER THIS SECURITY
PURSUANT TO THIS CLAUSE (4) PRIOR TO THE EXPIRATION OF THE "40 DAY RESTRICTED
PERIOD" (WITHIN THE MEANING OF RULE 903(c)(3) OF REGULATION S UNDER THE
SECURITIES ACT)), (5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT,
OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. AN INSTITUTIONAL ACCREDITED INVESTOR HOLDING THIS
SECURITY AGREES IT WILL FURNISH TO THE COMPANY AND THE TRUSTEE SUCH
CERTIFICATES, LEGAL OPINIONS AND OTHER INFORMATION AS THEY MAY REASONABLY
REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE
FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT (1) IT AND ANY
ACCOUNT FOR WHICH IT IS ACTING IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A OR (2) IT IS AN INSTITUTION THAT IS AN "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES
ACT AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION OR (3) IT IS A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (o)(2)
OR RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH SUCCESSOR DEPOSITORY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO AN ISSUER OR
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ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
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 DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE 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 NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.14 OF THE INDENTURE.
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No.
$
11 3/8% Senior Subordinated Notes Due 2008
CUSIP No. 000000XX0
MSX INTERNATIONAL, INC., a Delaware corporation, promises to pay to Cede &
Co., or registered assigns, the principal sum of Dollars on
January 15, 2008.
Interest Payment Dates: January 15 and July 15.
Record Dates: January 1 and July 1.
Additional provisions of this Security are set forth on the reverse side
of this Security.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
MSX INTERNATIONAL, INC.
By:
---------------------------------
Name:
Title:
Dated:
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TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
IBJ Xxxxxxxx Bank & Trust Company, as Trustee, certifies that this is one of
the Securities referred to in the within-mentioned Indenture.
By:
IBJ XXXXXXXX BANK & TRUST
COMPANY, as Trustee
By:
---------------------
Name:
Title:
Date of Authentication:
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[REVERSE OF SECURITY]
11 3/8% SENIOR SUBORDINATED SECURITY DUE 2008
1. Interest
MSX INTERNATIONAL, INC., a Delaware corporation (such entity, and its
successors and assigns under the Indenture hereinafter referred to, and each
other entity which is required to become the Company pursuant to the Indenture,
and its successors and assigns under the Indenture, 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 semi-annually
on January 15 and July 15 of each year, commencing July 15, 1998. Interest on
the Securities will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from January 22, 1998. Interest will be
computed on the basis of a 360-day year of twelve 30-day months. The Company
shall pay interest on overdue principal at 1% per annum in excess of the rate
borne by the Securities, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the record date immediately preceding the interest payment date
even if Securities are canceled on registration of transfer or registration of
exchange (including pursuant to an Exchange Offer (as defined in the applicable
Registration Agreement)) after the record 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 ("U.S. Legal
Tender"). However, the Company may pay principal and interest by its check
payable in such U.S. Legal Tender. The Company may deliver any such interest
payment to the Paying Agent or to a Holder's registered address.
3. Paying Agent and Registrar
Initially, IBJ Xxxxxxxx Bank & Trust Company, a national banking
corporation ("Trustee"), will act as Paying
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Agent and Registrar. The Company may appoint and change any Paying Agent,
Registrar or co-registrar without notice. The Company may act as Paying Agent,
Registrar, co-Registrar or transfer agent.
4. Indenture
The Company issued the Securities under an Indenture dated as of January
15, 1998 (the "Indenture"), among the Company, the Subsidiary Guarantors and
the Trustee. This Security is one of a duly authorized issue of Initial
Securities of the Company designated as its 11 3/8% Senior Subordinated Notes
due 2008 (the "Initial Securities"). The Securities include the Initial
Securities and the Exchange Securities (as defined in the Indenture) issued in
exchange for the Initial Securities pursuant to the Registration Agreement.
The Initial Securities and the Exchange Securities are treated as a single
class of securities under the Indenture. The terms of the Securities include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as in
effect on the date of the Indenture (the "TIA"). Terms defined in the
Indenture 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 TIA for a statement of those terms. Any
conflict between this Security and the Indenture will be governed by the
Indenture.
The Securities are unsecured senior subordinated obligations of the
Company limited to $130,000,000 aggregate principal amount. The Indenture
imposes certain limitations on the Incurrence of Indebtedness by the Company
and its Restricted Subsidiaries, the existence of liens, the payment of
dividends on, and redemption of, the Capital Stock of the Company and its
Subsidiaries, restricted payments, the sale or transfer of assets and
Subsidiary stock, the issuance or sale of Capital Stock of Restricted
Subsidiaries, the investments of the Company and its Restricted Subsidiaries,
consolidations, mergers and transfers of all or substantially all the assets of
the Company, and transactions with Affiliates. In addition, the Indenture
limits the ability of the Company and certain of its Subsidiaries to restrict
distributions and dividends from Restricted Subsidiaries.
To guarantee the due and punctual payment of the principal, premium and
interest, if any, on the Securities and
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all other amounts payable by the Company under the Indenture and the Securities
when and as the same shall be due and payable, whether at maturity, by
acceleration or otherwise, according to the terms of the Securities and the
Indenture, the Subsidiary Guarantors have unconditionally guaranteed the
Obligations on a senior subordinated basis pursuant to the terms of the
Indenture.
5. Optional Redemption
Except as set forth in the next paragraph, the Securities may not be
redeemed at the option of the Company prior to January 15, 2003. Thereafter,
the Securities will be redeemable, at the Company's option, in whole or in
part, at any time or from time to time, at the following redemption prices
(expressed in percentages of principal amount), plus accrued and unpaid
interest 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 January 15
of the years set forth below:
Period Percentage
------ ----------
2003............... 105.6875%
2004............... 103.7917%
2005............... 101.8958%
2006 and thereafter 100.0000%
In addition, at any time and from time to time prior to January 15, 2001,
the Company may redeem in the aggregate up to 35% of the original principal
amount of the Securities with the proceeds of one or more Public Equity
Offerings following which there is a Public Market, at a redemption price
(expressed as a percentage of principal amount) of 111.375% plus accrued and
unpaid 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); provided, however, that at least 65% of the
original aggregate principal amount of the Securities must remain outstanding
after each such redemption.
6. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30 days
but not more than 60 days before the re-
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demption date to each Holder of Securities to be redeemed at his registered
address. Securities in denominations 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 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. If a notice or communication
is sent in the manner provided in the Indenture, it is duly given, whether or
not the addressee receives it. Failure to send a notice or communication to a
Securityholder or any defect in it shall not affect its sufficiency with
respect to other Securityholders.
In addition, in the event of certain Asset Dispositions, the Company will
be required to make an offer to purchase Securities at a purchase price of 100%
of their principal amount plus accrued interest to the date of purchase
(subject to the rights of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date) as provided in, and
subject to the terms of, the Indenture.
7. Change of Control
Upon a Change of Control, each Holder of Securities will have the right to
require the Company to repurchase all or any part of the Securities of such
Holder at a repurchase price in cash equal to 101% of the principal amount of
the Securities to be repurchased plus accrued and unpaid interest to the date
of repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.
8. The Registration Agreement
The holder of this Security is entitled to the benefits of a Registration
Agreement, dated as of January 22, 1998, among the Company, the Subsidiary
Guarantors and the Initial Purchasers named therein (as such may be amended
from time to time, the "Registration Agreement"). Capitalized terms used in
this subsection but not defined herein have the meanings assigned to them in
the Registration Agreement.
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In the event that (i) neither the Exchange Offer Registration Statement
nor the Shelf Registration Statement has been filed with the Commission within
90 days after the Issue Date, (ii) within 180 days after the Issue Date, either
the Exchange Offer Registration Statement or the Shelf Registration Statement
has not been declared effective (provided that this clause (ii) shall not apply
to any Securities as to which a Shelf Registration Statement is requested by an
Initial Purchaser), (iii) within 210 days of the Issue Date, the Exchange Offer
has not been consummated or, with respect to any Securities as to which a Shelf
Registration Statement is requested by an Initial Purchaser, such Shelf
Registration Statement has not been declared effective within 240 days after
the Issue Date, or (iv) after either the Exchange Offer Registration Statement
or the Shelf Registration Statement has been declared effective, such
Registration Statement thereafter ceases to be effective or usable (subject to
certain exceptions set forth in the Registration Agreement) in connection with
resales of the Securities or the Exchange Securities at any time that the
Company is obligated to maintain the effectiveness thereof pursuant to the
Registration Agreement (each such event referred to in clauses (i) through (iv)
above being referred to herein as a "Registration Default"), interest ("Special
Interest") will accrue on the Securities and the Exchange Securities (in
addition to the interest described above) from and including the date on which
any Registration Default shall occur but excluding the date on which all such
Registration Defaults have been cured. Special Interest shall accrue at a rate
of 0.25% per annum during the 90-day period immediately following the
occurrence of any Registration Default and shall increase by 0.25% per annum at
the end of each subsequent 90-day period, but in no event shall such Special
Interest exceed 1.00% per annum.
9. Subordination
The Securities are subordinated to Senior Indebtedness of the Company, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. In
addition, each Subsidiary Guarantee is subordinated to Senior Indebtedness of
the relevant Subsidiary Guarantor, as defined in the Indenture. The Company
and each Subsidiary Guarantor agrees, and each Holder by accepting a Security
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.
X-00
000
00. Denominations; Transfer; Exchange
The Securities are in registered form, without coupons, and in
denominations of $1,000 and integral 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, including any transfer tax or other similar
governmental charge payable in connection therewith. The Registrar need not
register the transfer of or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or any Securities for a period of 15 days before a
selection of Securities to be redeemed or 15 days before an interest payment
date.
11. Persons Deemed Owners
The registered Holder of this Security may be treated as the owner of it
for all purposes.
12. 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 written 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.
13. Discharge and Defeasance
Subject to certain conditions, 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.
14. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the consent of the Holders of
at least a majority in principal amount outstanding of the Securities and (ii)
any past default
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or compliance with any provision may be waived with the consent of the Holders
of a majority in principal amount outstanding of the Securities. Subject to
certain exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company, the Subsidiary Guarantors and the Trustee may
amend the Indenture or the Securities to cure any ambiguity, omission, defect
or inconsistency, to comply with Article 5 of the Indenture, to provide for
uncertificated Securities in addition to or in place of certificated
Securities, to add guarantees with respect to the Securities, to secure the
Securities, to add additional covenants or surrender rights and powers
conferred on the Company, to make any change that does not adversely affect the
rights of any Securityholder or to comply with any request of the SEC in
connection with qualifying the Indenture under the TIA.
15. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30 days in
payment of interest on the Securities; (ii) default in payment of principal on
any Security when due at its Stated Maturity, upon redemption pursuant to
paragraphs 5 or 6 above, upon required repurchase, upon acceleration or
otherwise, (iii) failure by the Company to comply for 60 days after notice with
any of its obligations under Sections 4.3, 4.5, 4.7 and 5.1 of the Indenture;
(iv) failure by the Company to comply for 60 days after notice with other
agreements in the Indenture or the Securities, in certain cases subject to
notice and lapse of time; (v) failure by the Company or any Significant
Subsidiary to pay any Indebtedness within any applicable grace period after
final maturity or acceleration by the Holders thereof because of a default and
the total amount of such Indebtedness unpaid or accelerated exceeds $5.0
million; (vi) certain events of bankruptcy, insolvency or reorganization of the
Company or any Significant Subsidiary; and (vii) the rendering of any judgments
or decrees for the payment of money in excess of $5.0 million is rendered
against the Company or a Restricted Subsidiary.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities then outstanding
may declare all the Securities to be due and payable. 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.
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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 reasonable indemnity or security. 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
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.
16. Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA, 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 or any of its Affiliates and may otherwise deal with the
Company or any of its Affiliates with the same rights it would have if it were
not Trustee.
17. No Recourse Against Others
No recourse for the payment of the principal of, premium, if any, or
interest on any of the Securities or for any claim based thereon or otherwise
in respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture, or in any of the Securities or
because of the creation of any Indebtedness represented hereby and thereby,
shall be had against any incorporator, stockholder, officer, director, employee
or controlling person of the Company, a Subsidiary Guarantor or any Successor
Person thereof. Each Holder, by accepting a Security, waives and releases all
such liability.
18. Guarantees
This Security will be entitled to the benefits of certain Guarantees, if
any, made for the benefit of the Holders. Reference is hereby made to the
Indenture for a statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Subsidiary Guarantors, the Trustee and
the Holders.
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19. Governing Law
The Indenture and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York without giving effect to
applicable principles of conflict of laws to the extent that the application of
the laws of another jurisdiction would be required thereby.
20. Authentication
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
21. 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
entireties), 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).
22. 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 have 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.
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 as follows:
If to the Company:
MSX International, Inc.
000 Xxx Xxxxxxxxx
Xxxxxx Xxxxx, XX 00000
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135
If to the Trustee:
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
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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: _______________
Sign exactly as your name appears on the
other side of this Security.
Signature Guarantee: _______________
(Signature must be guaranteed)
In connection with any transfer of this Security occurring prior to the
date which is the earlier of (i) the date of the declaration by the Commission
of the effectiveness of a registration statement under the Securities Act of
1933, as amended (the "Securities Act") covering resales of this Security
(which effectiveness shall not have been suspended or terminated at the date of
the transfer) and (ii) [ ], the undersigned confirms that it has not
utilized any general solicitation or general advertising in connection with the
transfer:
[Check One]
(1) __ to the Company or a subsidiary thereof; or
(2) __ pursuant to and in compliance with Rule 144A under the Securities Act
of 1933, as amended; or
(3) __ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securi-
A-16
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ties Act of 1933, as amended) that has furnished to the Trustee a
signed letter containing certain representations and agreements
(the form of which letter can be obtained from the Trustee); or
(4) - outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as amended;
or
(5) - pursuant to the exemption from registration provided by Rule 144
under the Securities Act of 1933, as amended; or
(6) - pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(7) - pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
and unless the box below is checked, the undersigned confirms that such Note is
not being transferred to an "affiliate" of the Company as defined in Rule 144
under the Securities Act of 1933, as amended (an "Affiliate"):
[ ] The transferee is an Affiliate of the Company.
Unless one of the items is checked, the Trustee will 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 item (3),
(4), (5) or (7) is checked, the Company or the Trustee may require, prior to
registering any such transfer of the Securities, in their sole discretion, such
written legal opinions, certifications (including an investment letter in the
case of box (3) or (4)) and other information as the Trustee or the Company has
reasonably requested 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, as amended.
If none of the foregoing items are checked, the Trustee or 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
registra-
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tion set forth herein and in Section 2.14 of the Indenture shall have been
satisfied.
Dated: ____________________ Signed:_______________________________
(Sign exactly as name appears
on the otherside of this
Security)
Signature Guarantee: _______________________________________
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TO BE COMPLETED BY PURCHASER IF (2) 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 Issuer 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.
Dated: ______________ _______________________________________________
NOTICE: To be executed by an executive officer
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.7 or 4.12 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 4.7 or 4.12 of the Indenture, state the amount: $
Date: ______________ Your Signature: _______________
(Sign exactly as your name appears on the
other side of the Security)
Signature Guarantee: ____________________________
(Signature must be guaranteed)
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EXHIBIT B
FACE OF SECURITY
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, 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 NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. TRANSFERS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES
OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY, OR BY ANY SUCH NOMINEE OF THE
DEPOSITORY, OR BY THE DEPOSITORY OR NOMINEE OF SUCH SUCCESSOR DEPOSITORY OR
ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO AN ISSUER 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 NAME 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 DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE 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 NOTE SHALL BE
LIMITED TO
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TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.14
OF THE INDENTURE.
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No.
$
11 3/8% Senior Subordinated Notes Due 2008
CUSIP No. 000000XX0
MSX INTERNATIONAL, INC., a Delaware corporation, promises to pay to Cede &
Co., or registered assigns, the principal sum of
Dollars on January 15, 2008.
Interest Payment Dates: January 15 and July 15.
Record Dates: January 1 and July 1.
Additional provisions of this Security are set forth on the reverse side
of this Security.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
MSX INTERNATIONAL, INC.
By:____________________
Name:
Title:
Dated:
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TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
IBJ Xxxxxxxx Bank & Trust Company, as Trustee, certifies that this is one of
the Securities referred to in the within-mentioned Indenture.
By:
IBJ XXXXXXXX BANK & TRUST
COMPANY,
as Trustee
____________________________
Authorized Signatory
Date of Authentication:
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[REVERSE OF SECURITY]
11 3/8% SENIOR SUBORDINATED NOTE DUE 2008
1. Interest
MSX INTERNATIONAL, INC., a Delaware corporation (such entity, and its
successors and assigns under the Indenture hereinafter referred to, and each
other entity which is required to become the Company pursuant to the Indenture,
and its successors and assigns under the Indenture, 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 semi-annually
on January 15 and July 15 of each year, commencing July 15, 1998. Interest on
the Securities will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from January 22, 1998. Interest will be
computed on the basis of a 360-day year of twelve 30-day months. The Company
shall pay interest on overdue principal at 1% per annum in excess of the rate
borne by the Securities, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.
2. Method of Payment
The Company will pay interest on the Securities (except defaulted
interest) to the Persons who are registered holders of Securities at the close
of business on the record date immediately preceding the interest payment date
even if Securities are canceled on registration of transfer or registration of
exchange (including pursuant to an Exchange Offer (as defined in the applicable
Registration Agreement)) after the record 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 ("U.S. Legal
Tender"). However, the Company may pay principal and interest by its check
payable in such U.S. Legal Tender. The Company may deliver any such interest
payment to the Paying Agent or to a Holder's registered address.
3. Paying Agent and Registrar
Initially, IBJ Xxxxxxxx Bank & Trust Company, a national banking
corporation ("Trustee"), will act as Paying
B-5
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Agent and Registrar. The Company may appoint and change any Paying Agent,
Registrar or co-registrar without notice. The Company may act as Paying Agent,
Registrar, co-Registrar or transfer agent.
4. Indenture
The Company issued the Securities under an Indenture dated as of January
15, 1998 (the "Indenture"), among the Company, the Subsidiary Guarantors and
the Trustee. This Security is one of a duly authorized issue of Unrestricted
Securities of the Company designated as its 11 3/8% Senior Subordinated Notes
due 2008 (the "Unrestricted Securities"). The Securities include the 11 3/8%
Senior Subordinated Notes due 2008 (the "Initial Securities") and the Exchange
Securities (as defined in the Indenture) issued in exchange for the Initial
Securities pursuant to the Registration Agreement. The Initial Securities and
the Exchange Securities are treated as a single class of securities under the
Indenture. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939 (15 U.S.C. Section 77aaa-77bbbb) as in effect on the date of the
Indenture (the "TIA"). Terms defined in the Indenture 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 TIA for a statement of those terms. Any conflict between this Security
and the Indenture will be governed by the Indenture.
The Securities are unsecured senior subordinated obligations of the
Company limited to $130,000,000 aggregate principal amount. The Indenture
imposes certain limitations on the Incurrence of Indebtedness by the Company
and its Restricted Subsidiaries, the existence of liens, the payment of
dividends on, and redemption of, the Capital Stock of the Company and its
Subsidiaries, restricted payments, the sale or transfer of assets and
Subsidiary stock, the issuance or sale of Capital Stock of Restricted
Subsidiaries, the investments of the Company and its Restricted Subsidiaries,
consolidations, mergers and transfers of all or substantially all the assets of
the Company, and transactions with Affiliates. In addition, the Indenture
limits the ability of the Company and certain of its Subsidiaries to restrict
distributions and dividends from Restricted Subsidiaries.
B-6
147
To guarantee the due and punctual payment of the principal, premium and
interest, if any, on the Securities and all other amounts payable by the
Company under the Indenture and the Securities when and as the same shall be
due and payable, whether at maturity, by acceleration or otherwise, according
to the terms of the Securities and the Indenture, the Subsidiary Guarantors
have unconditionally guaranteed the Obligations on a senior subordinated basis
pursuant to the terms of the Indenture.
5. Optional Redemption
Except as set forth in the next paragraph, the Securities may not be
redeemed prior to January 15, 2003. Thereafter, the Securities will be
redeemable, at the Company's option, in whole or in part, at any time or from
time to time, at the following redemption prices (expressed in percentages of
principal amount), plus accrued and unpaid interest 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 January 15 of the years set forth below:
Period Percentage
------ ----------
2003............... 105.6875%
2004............... 103.7917%
2005............... 101.8958%
2006 and thereafter 100.0000%
In addition, at any time and from time to time prior to , 2001,
the Company may redeem in the aggregate up to 35% of the original principal
amount of the Securities with the proceeds of one or more Public Equity
Offerings following which there is a Public Market, at a redemption price
(expressed as a percentage of principal amount) of 111.375% plus accrued and
unpaid 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); provided, however, that at least 65% of the
original aggregate principal amount of the Securities must remain outstanding
after each such redemption.
B-7
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6. Notice of Redemption
Notice of redemption will be mailed by first-class mail at least 30 days
but not more than 60 days before the redemption date to each Holder of
Securities to be redeemed at his registered address. Securities in
denominations 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 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. If a notice or communication is sent in the manner provided in
the Indenture, it is duly given, whether or not the addressee receives it.
Failure to send a notice or communication to a Securityholder or any defect in
it shall not affect its sufficiency with respect to other Securityholders.
In addition, in the event of certain Asset Dispositions, the Company will
be required to make an offer to purchase Securities at a purchase price of 100%
of their principal amount plus accrued interest to the date of purchase
(subject to the rights of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date) as provided in, and
subject to the terms of, the Indenture.
7. Change of Control
Upon a Change of Control, each Holder of Securities will have the right to
require the Company to repurchase all or any part of the Securities of such
Holder at a repurchase price in cash equal to 101% of the principal amount of
the Securities to be repurchased plus accrued and unpaid interest to the date
of repurchase (subject to the right of Holders of record on the relevant record
date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.
8. Subordination
The Securities are subordinated to Senior Indebtedness of the Company, as
defined in the Indenture. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. In
addition, each Subsidiary Guarantee is subordinated to Senior In-
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149
debtedness of the relevant Subsidiary Guarantor, as defined in the Indenture.
The Company and each Subsidiary Guarantor agrees, and each Holder by accepting
a Security agrees, to the subordination provisions contained in the Indenture
and authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.
9. Denominations; Transfer; Exchange
The Securities are in registered form, without coupons, and in
denominations of $1,000 and integral 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, including any transfer tax or other similar
governmental charge payable in connection therewith. The Registrar need not
register the transfer of or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or any Securities for a period of 15 days before a
selection of Securities to be redeemed or 15 days before an 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 written 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. Discharge and Defeasance
Subject to certain conditions, 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.
X-0
000
00. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the consent of the Holders of
at least a majority in principal amount outstanding of the Securities and (ii)
any past default or compliance with any provision may be waived with the
consent of the Holders of a majority in principal amount outstanding of the
Securities. Subject to certain exceptions set forth in the Indenture, without
the consent of any Securityholder, the Company, the Subsidiary Guarantors and
the Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, to comply with Article 5 of the Indenture,
to provide for uncertificated Securities in addition to or in place of
certificated Securities, to add guarantees with respect to the Securities, to
secure the Securities, to add additional covenants or surrender rights and
powers conferred on the Company, to make any change that does not adversely
affect the rights of any Securityholder or to comply with any request of the
SEC in connection with qualifying the Indenture under the TIA.
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30 days in
payment of interest on the Securities; (ii) default in payment of principal on
any Security when due at its Stated Maturity, upon redemption pursuant to
paragraphs 5 or 6 above, upon required repurchase, upon acceleration or
otherwise; (iii) failure by the Company to comply for 60 days after notice with
any of its obligations under Sections 4.3, 4.5, 4.7 or 5.1 of the Indenture;
(iv) failure by the Company to comply for 60 days after notice with other
agreements in the Indenture or the Securities, in certain cases subject to
notice or lack of time; (v) failure by the Company or any Significant
Subsidiary to pay any Indebtedness within any applicable grace period after
final maturity or acceleration by the Holders thereof because of a default and
the total amount of such Indebtedness unpaid or accelerated exceeds $5.0
million; (vi) certain events of bankruptcy, insolvency or reorganization of the
Company or any Significant Subsidiary; and (vii) the rendering of any judgments
or decrees for the payment of money in excess of $5.0 million is rendered
against the Company or a Restricted Subsidiary.
B-10
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If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Securities then outstanding
may declare all the Securities to be due and payable. 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 reasonable indemnity or security. 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
(except a Default in payment of principal or interest) if it determines that
withholding notice is in the interest of the Holders.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the TIA, 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 or any of its Affiliates and may otherwise deal with the
Company or any of its Affiliates with the same rights it would have if it were
not Trustee.
16. No Recourse Against Others
No recourse for the payment of the principal of, premium, if any, or
interest on any of the Securities or for any claim based thereon or otherwise
in respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture, or in any of the Securities or
because of the creation of any Indebtedness represented hereby and thereby,
shall be had against any incorporator, stockholder, officer, director, employee
or controlling person of the Company, a Subsidiary Guarantor or any Successor
Person thereof. Each Holder, by accepting a Security, waives and releases all
such liability.
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17. Guarantees
This Security will be entitled to the benefits of certain Guarantees, if
any, made for the benefit of the Holders. Reference is hereby made to the
Indenture for a statement of the respective rights, limitations of rights,
duties and obligations thereunder of the Subsidiary Guarantors, the Trustee and
the Holders.
18. Governing Law
The Indenture and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York without giving effect to
applicable principles of conflict of laws to the extent that the application of
the laws of another jurisdiction would be required thereby.
19. Authentication
This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
20. 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
entireties), 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).
21. 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 have 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.
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153
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 as follows:
If to the Company:
MSX International, Inc.
000 Xxx Xxxxxxxxx
Xxxxxx Xxxxx, XX 00000
If to the Trustee:
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust Department
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
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154
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: _______________
Sign exactly as your name appears on the
other side of this Security.
Signature Guarantee: _______________________________
(Signature must be guaranteed)
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155
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.7 or 4.12 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 4.7 or 4.12 of the Indenture, state the amount: $
Date: ______________ Your Signature: _______________
(Sign exactly as your name appears on the
other side of the Security)
Signature Guarantee:______________________________
(Signature must be guaranteed)
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EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
[ ], [ ]
[ ]
[ ]
[ ]
Ladies and Gentlemen:
In connection with our proposed purchase of % Senior Subordinated
Notes due 2008 (the "Securities") of MSX International, Inc., a Delaware
corporation (the "Company"), we confirm that:
1. We have received a copy of the Offering Memorandum (the "Offering
Memorandum"), dated as of , 1998, relating to the Securities and
such other information as we deem necessary in order to make our
investment decision. We acknowledge that we have read and agreed to the
matters stated in the section entitled "Notice to Investors" of such
Offering Memorandum.
2. We understand that any subsequent transfer of the Securities is
subject to certain restrictions and conditions set forth in the Indenture
relating to the Securities (the "Indenture") as described in the Offering
Memorandum and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Securities except in compliance with,
such restrictions and conditions and the Securities Act of 1933, as
amended (the "Securities Act"), and all applicable state securities laws.
3. We understand that the offer and sale of the Securities have not
been registered under the Securities Act, and that the Securities may not
be offered or sold within the United States or to, or for the account or
benefit of, U.S. persons except as permitted in the following sentence.
We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinaf-
C-1
157
ter stated, that if we should sell any Securities, we will do so only (i)
to the Company or any subsidiary thereof, (ii) inside the United States
in accordance with Rule 144A under the Securities Act to a "qualified
institutional buyer" (as defined in Rule 144A promulgated under the
Securities Act), (iii) inside the United States to an institutional
"accredited investor" (as defined below) that, prior to such transfer,
furnishes (or has furnished on its behalf by a U.S. broker-dealer) to the
Trustee (as defined in the Indenture) a signed letter containing certain
representations and agreements relating to the restrictions on transfer
of the Securities (the form of which letter can be obtained from the
Trustee), (iv) outside the United States in accordance with Rule 904 of
Regulation S promulgated under the Securities Act to non-U.S. persons,
(v) pursuant to the exemption from registration provided by Rule 144
under the Securities Act (if available), or (vi) pursuant to an effective
registration statement under the Securities Act, and we further agree to
provide to any person purchasing any of the Securities from us a notice
advising such purchaser that resales of the Securities are restricted as
stated herein.
4. We understand that, on any proposed resale of any Securities, we
will be required to furnish to the Trustee and the Company such
certification, legal opinions and other information as the Trustee and
the Company may reasonably require to confirm that the proposed sale
complies with the foregoing restrictions. We further understand that the
Securities purchased by us will bear a legend to the foregoing effect.
5. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
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 we and any accounts for which we are acting are each able
to bear the economic risk of our or their investment, as the case may be.
6. We are acquiring the Securities purchased by us for our account
or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole investment
discretion.
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You, the Company, the Trustee and others 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 proceeding or official
inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:
--------------------
Name:
Title:
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159
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
[ ], [ ]
[ ]
[ ]
[ ]
[ ]
Re: MSX International, Inc. (the "Company")
% 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 U.S. Securities Act of 1933,
as amended (the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to a person in the
United States;
(2) either (a) at the time the buy offer 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 (b) the transaction was executed in, on or through the
facilities of a designated offshore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
prearranged with a buyer in the United States;
(3) 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;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
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(5) we have advised the transferee of the transfer restrictions
applicable to the Securities.
You, the Company and counsel for 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
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EXHIBIT E
GUARANTEE
For value received, the undersigned hereby unconditionally guarantees on a
senior subordinated basis, as principal obligor and not only as a surety, to
the Holder of this Security the cash payments in United States dollars of
principal of, premium, if any, and interest on this Security (and including
Additional Interest payable thereon) in the amounts and at the times when due
and interest on the overdue principal, premium, if any, and interest, if any,
of this Security, if lawful, and the payment or performance of all other
obligations of the Company under the Indenture (as defined below) or the
Securities, to the Holder of this Security and the Trustee, all in accordance
with and subject to the terms and limitations of this Security, Article Eleven
of the Indenture and this Guarantee. This Guarantee will become effective in
accordance with Articles Eleven and Twelve of the Indenture and its terms shall
be evidenced therein. The validity and enforceability of any Guarantee shall
not be affected by the fact that it is not affixed to any particular Security.
Capitalized terms used but not defined herein shall have the meanings ascribed
to them in the Indenture dated as of January 15, 1998, by and among MSX
International, Inc., a Delaware corporation, as issuer (the "Company"), each of
the Subsidiary Guarantors named therein and IBJ Xxxxxxxx Bank & Trust Company,
as trustee (the "Trustee"), as amended or supplemented (the "Indenture").
The obligations of the undersigned to the Holders of Securities and to the
Trustee pursuant to this Guarantee and the Indenture are expressly set forth in
Articles Eleven and Twelve of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Guarantee and all of the other
provisions of the Indenture to which this Guarantee relates.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS
OF LAW. Each Guarantor hereby agrees to submit to the jurisdiction of the
courts of the State of New York in any action or proceeding arising out of or
relating to this Guarantee.
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This Guarantee is subject to release upon the terms set forth in the
Indenture.
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163
IN WITNESS WHEREOF, each Guarantor has caused its Guarantee to be duly
executed.
GUARANTORS:
GEOMETRIC RESULTS INCORPORATED
By:
-----------------------------
Name:
Title:
MSX
INTERNATIONAL ENGINEERING SERVICES,
INC.
By:
-----------------------------
Name:
Title:
MSX
INTERNATIONAL BUSINESS SERVICES, INC.
By:
-----------------------------
Name:
Title:
MSX
INTERNATIONAL (USA), INC.
By:
-----------------------------
Name:
Title:
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164
MSX INTERNATIONAL (HOLDINGS), INC.
By:
---------------------------------
Name:
Title:
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165
EXHIBIT F
FORM OF SUPPLEMENTAL INDENTURE
SUPPLEMENTAL INDENTURE (this "Supplemental Indenture"), dated as of
_______________, among [Subsidiary Guarantors] (the "New Subsidiary
Guarantor"), a subsidiary of MSX International, Inc. (or its successor), a
Delaware corporation (the "Company"), the Subsidiary Guarantors (the "Existing
Subsidiary Guarantors") under the Indenture referred to below, and IBJ XXXXXXXX
BANK & TRUST COMPANY, a national banking corporation, as trustee under the
Indenture referred to below (the "Trustee").
W I T N E S S E T H :
WHEREAS the Company has heretofore executed and delivered to the Trustee
an Indenture (as such may be amended from time to time, the "Indenture"), dated
as of January , 1998, providing for the issuance of up to aggregate principal
amount of $130,000,000 of 11 3/8% Senior Subordinated Notes due 2008 (the
"Securities");
WHEREAS Section 4.16 of the Indenture provides that under certain
circumstances the Company is required to cause the New Subsidiary Guarantor to
execute and deliver to the Trustee a supplemental indenture pursuant to which
the New Subsidiary Guarantor shall unconditionally guarantee on a senior
subordinated basis all of the Company's obligations under the Securities
pursuant to a Subsidiary Guarantee on the terms and conditions set forth
herein; and
WHEREAS pursuant to Section 9.1 of the Indenture, the Trustee, the Company
and Existing Subsidiary Guarantors are authorized to execute and deliver this
Supplemental Indenture;
NOW THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the New
Subsidiary Guarantor, the Company, the Existing Subsidiary Guarantors and the
Trustee mutually covenant and agree for the equal and ratable benefit of the
holders of the Securities as follows:
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1. Definitions. (a) Capitalized terms used herein without definition
shall have the meanings assigned to them in the Indenture.
(b) For all purposes of this Supplemental Indenture, except as otherwise
herein expressly provided or unless the context otherwise requires: (i) the
terms and expressions used herein shall have the same meanings as corresponding
terms and expressions used in the Indenture; and (ii) the words "herein,"
"hereof" and "hereby" and other words of similar import used in this
Supplemental Indenture refer to this Supplemental Indenture as a whole and not
to any particular section hereof.
2. Agreement to Guarantee. The New Subsidiary Guarantor hereby agrees,
jointly and severally with all other Subsidiary Guarantors, to guarantee on a
senior subordinated basis the Company's obligations under the Securities on the
terms and subject to the conditions set forth in Article 11 of the Indenture
and to be bound by all other applicable provisions of the Indenture. From and
after the date hereof, the New Subsidiary Guarantor shall be a Subsidiary
Guarantor for all purposes under the Indenture and the Securities.
3. Ratification of Indenture; Supplemental Indentures Part of Indenture.
Except as expressly amended hereby, the Indenture is in all respects ratified
and confirmed and all the terms, conditions and provisions thereof shall remain
in full force and effect. This Supplemental Indenture shall form a part of the
Indenture for all purposes, and every holder of Securities heretofore or
hereafter authenticated and delivered shall be bound hereby.
4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT
GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT
THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
5. Trustee Makes No Representation. The Trustee makes no representation
as to the validity or sufficiency of this Supplemental Indenture.
6. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy
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167
shall be an original, but all of them together represent the same agreement.
7. Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction thereof.
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168
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed as of the date first above written.
IBJ
XXXXXXXX BANK & TRUST COMPANY, as
Trustee
By:______________________________
Name:
Title:
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