EXHIBIT 4.2
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PHOENIX COLOR CORP.
Issuer
$105,000,000
10 3/8% Senior Subordinated Notes due 2009
INDENTURE
Dated as of February 2, 1999
CHASE MANHATTAN TRUST COMPANY,
NATIONAL ASSOCIATION
Trustee
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CROSS-REFERENCE TABLE
TIA Section Indenture Section
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310(a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
310(a)(5) 7.10
(b) 7.08; 7.10
(c) N.A.
311(a) 7.11
(b) 7.11
(c) N.A.
312(a) 2.05
(b) 13.03
(c) 13.03
313(a) 7.06
(b)(1) N.A.
(b)(2) 7.06
(c) 13.02
(d) 7.06
314(a) 4.07; 13.02
(b) N.A.
(c)(1) 13.04
(c)(2) 13.04
(c)(3) N.A.
(d) N.A.
(e) 13.05
(f) 4.11
315(a) 7.01
(b) 7.05; 13.02
(c) 7.01
(d) 7.01
(e) 6.11
316(a)(last sentence) 13.06
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) N.A.
(b) 6.07
316(c) 9.04
317(a)(1) 6.08
(a)(2) 6.09
(b) 2.04
318(a) 13.01
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to
be part of this Indenture.
TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE........................1
SECTION 1.01. Definitions.............................................1
SECTION 1.02. Incorporation by Reference of Trust Indenture Act......20
SECTION 1.03. Rules of Construction..................................21
ARTICLE 2 THE NOTES........................................................22
SECTION 2.01. Form and Dating........................................22
SECTION 2.02. Execution and Authentication...........................25
SECTION 2.03. Registrar and Paying Agent.............................26
SECTION 2.04. Paying Agent To Hold Money in Trust....................27
SECTION 2.05 Holder Lists...........................................27
SECTION 2.06. Global Notes...........................................28
SECTION 2.07. Transfer and Exchange..................................28
SECTION 2.08. Replacement Notes......................................34
SECTION 2.09. Outstanding Notes......................................35
SECTION 2.10. Temporary Notes........................................35
SECTION 2.11. Cancellation...........................................35
SECTION 2.12. Payment of Interest, Interest Rights Preserved.........35
SECTION 2.13. CUSIP Numbers..........................................36
SECTION 2.14. Transfers, etc.........................................36
ARTICLE 3 REDEMPTION.......................................................37
SECTION 3.01. Notices to Trustee.....................................37
SECTION 3.02. Selection of Notes To Be Redeemed......................37
SECTION 3.03. Notice of Redemption...................................37
SECTION 3.04. Effect of Notice of Redemption.........................38
SECTION 3.05. Deposit of Redemption Price............................38
SECTION 3.06. Notes Redeemed in Part.................................39
ARTICLE 4 COVENANTS........................................................39
SECTION 4.01. Payment of Notes.......................................39
SECTION 4.02. Maintenance of Office or Agency........................39
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SECTION 4.03. Money for the Notes to be Held in Trust................40
SECTION 4.04. Corporate Existence....................................40
SECTION 4.05. Maintenance of Property................................40
SECTION 4.06. Payment of Taxes and Other Claims......................41
SECTION 4.07. SEC Reports............................................41
SECTION 4.08. Limitation on Indebtedness.............................41
SECTION 4.09. Limitation on Restricted Payments......................41
SECTION 4.10. Limitation on Restrictions on Distributions from
Restricted Subsidiaries................................43
SECTION 4.11. Limitation on Sales of Assets and Subsidiary Stock.....44
SECTION 4.12. Limitation on Affiliate Transactions...................48
SECTION 4.13. Limitation on the Sale or Issuance of Capital Stock
of Restricted Subsidiaries.............................49
SECTION 4.14. Change of Control......................................49
SECTION 4.15. Limitation on Liens....................................52
SECTION 4.16. Limitation on Layered Indebtedness.....................52
SECTION 4.17. Compliance Certificate.................................53
SECTION 4.18. Waiver of Stay, Extension or Usury Laws................53
SECTION 4.19. Investment Company Act.................................53
SECTION 4.20. Limitation on Conduct of Business......................53
SECTION 4.21. Further Instruments and Acts...........................53
ARTICLE 5 SUCCESSOR COMPANY................................................53
SECTION 5.01. When Issuer May Merge or Transfer Assets...............53
ARTICLE 6 DEFAULTS AND REMEDIES............................................55
SECTION 6.01. Events of Default......................................55
SECTION 6.02. Acceleration...........................................56
SECTION 6.03. Other Remedies.........................................57
SECTION 6.04. Waiver of Past Defaults................................57
SECTION 6.05. Control by Majority....................................57
SECTION 6.06. Limitation on Suits....................................58
SECTION 6.07. Rights of Holders To Receive Payment...................58
SECTION 6.08. Collection Suit by Trustee.............................58
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SECTION 6.09. Trustee May File Proofs of Claim.......................58
SECTION 6.10. Priorities.............................................59
SECTION 6.11. Undertaking for Costs..................................59
SECTION 6.12. Waiver of Stay or Extension Laws.......................59
ARTICLE 7 TRUSTEE..........................................................60
SECTION 7.01. Duties of Trustee......................................60
SECTION 7.02. Rights of Trustee......................................61
SECTION 7.03. Individual Rights of Trustee...........................61
SECTION 7.04. Trustee's Disclaimer...................................62
SECTION 7.05. Notice of Defaults.....................................62
SECTION 7.06. Reports by Trustee to Holders..........................62
SECTION 7.07. Compensation and Indemnity.............................62
SECTION 7.08. Replacement of Trustee.................................63
SECTION 7.09. Successor Trustee by Merger............................64
SECTION 7.10. Eligibility; Disqualification..........................64
SECTION 7.11. Preferential Collection of Claims Against Issuer.......64
SECTION 7.12. Trustee's Application for Instructions from the
Issuer.................................................65
ARTICLE 8 DISCHARGE OF INDENTURE; DEFEASANCE...............................65
SECTION 8.01. Discharge of Liability on Notes; Defeasance............65
SECTION 8.02. Conditions to Defeasance...............................66
SECTION 8.03. Application of Trust Money.............................68
SECTION 8.04. Repayment to Issuer....................................68
SECTION 8.05. Indemnity for Government Obligation....................68
SECTION 8.06. Reinstatement..........................................68
ARTICLE 9 AMENDMENTS.......................................................68
SECTION 9.01. Without Consent of Holders.............................68
SECTION 9.02. With Consent of Holders................................69
SECTION 9.03. Compliance with Trust Indenture Act....................70
SECTION 9.04. Revocation and Effect of Consents and Waivers..........70
SECTION 9.05. Notation on or Exchange of Notes.......................71
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SECTION 9.06. Trustee To Sign Amendments.............................71
SECTION 9.07. Payment for Consent....................................71
ARTICLE 10 SUBORDINATION OF THE NOTES......................................71
SECTION 10.01. Agreement To Subordinate...............................71
SECTION 10.02. Liquidation, Dissolution, Bankruptcy...................71
SECTION 10.03. Default on Senior Indebtedness of the Issuer...........72
SECTION 10.04. Acceleration of Payment of Notes.......................73
SECTION 10.05. When Distribution Must Be Paid Over....................73
SECTION 10.06. Subrogation............................................73
SECTION 10.07. Relative Right.........................................73
SECTION 10.08. Subordination May Not Be Impaired by Issuer............73
SECTION 10.09. Rights of Trustee and Paying Agent.....................73
SECTION 10.10. Distribution or Notice to Representative...............74
SECTION 10.11. Article 10 Not To Prevent Events of Default or
Limit Right To Accelerate..............................74
SECTION 10.12. Trust Moneys Not Subordinated..........................74
SECTION 10.13. Trustee Entitled To Rely...............................74
SECTION 10.14. Trustee To Effectuate Subordination....................75
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior
Indebtedness...........................................75
SECTION 10.16. Reliance by Holders of Senior Indebtedness on
Subordination Provisions...............................75
SECTION 10.17. No Waiver of Subordination Provisions..................75
SECTION 10.18. Other Rights of Holders of Senior Indebtedness.........76
ARTICLE 11 GUARANTEES; RELEASE OF GUARANTEES; ADDITIONAL GUARANTEES........77
SECTION 11.01. Guarantees.............................................77
SECTION 11.02. Successors and Assigns.................................78
SECTION 11.03. No Waiver..............................................79
SECTION 11.04. Modification...........................................79
SECTION 11.05. Limitation of Guarantor's Liability....................79
SECTION 11.06. Release of Guarantees..................................79
SECTION 11.07. Additional Guarantees..................................80
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ARTICLE 12 SUBORDINATION OF THE GUARANTEES.................................80
SECTION 12.01. Agreement To Subordinate...............................80
SECTION 12.02. Liquidation, Dissolution, Bankruptcy...................80
SECTION 12.03. Default on Senior Indebtedness of Guarantor............80
SECTION 12.04. Demand for Payment.....................................81
SECTION 12.05. When Distribution Must Be Paid Over....................81
SECTION 12.06. Subrogation............................................81
SECTION 12.07. Relative Rights........................................82
SECTION 12.08. Subordination May Not Be Impaired by Guarantor.........82
SECTION 12.09. Rights of Trustee and Paying Agent.....................82
SECTION 12.10. Distribution or Notice to Representative...............82
SECTION 12.11. Article 12 Not To Prevent Defaults Under the
Guarantees or Limit Right To Demand Payment............82
SECTION 12.12. Trustee Entitled To Rely...............................83
SECTION 12.13. Trustee To Effectuate Subordination....................83
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior
Indebtedness of Guarantors.............................83
SECTION 12.15. Reliance by Holders of Senior Indebtedness on
Subordination Provisions...............................83
SECTION 12.16. No Waiver of Subordination Provisions..................84
SECTION 12.17. Other Rights of Holders of Senior Indebtedness.........84
ARTICLE 13 MISCELLANEOUS...................................................85
SECTION 13.01. Trust Indenture Act Controls...........................85
SECTION 13.02. Notices................................................85
SECTION 13.03 Communication by Holders with Other Holders............86
SECTION 13.04. Certificate and Opinion as to Conditions Precedent.....86
SECTION 13.05. Statements Required in Certificate or Opinion..........86
SECTION 13.06. When Notes Disregarded.................................87
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar...........87
SECTION 13.08. Legal Holidays.........................................87
SECTION 13.09. Governing Law..........................................87
SECTION 13.10. No Recourse Against Others.............................87
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SECTION 13.11. Successors, Assigns and Transferees....................88
SECTION 13.12. Multiple Originals.....................................88
SECTION 13.13. Table of Contents, Headings............................88
SECTION 13.14. Severability...........................................88
SECTION 13.15. Further Instruments and Acts...........................88
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EXHIBITS
Exhibit A - Form of Initial Global Note
Exhibit B - Form of Initial Certificated Note
Exhibit C - Form of Exchange Global Note
Exhibit D - Form of Exchange Certificated Note
Exhibit E - Form of Transfer Certificate For Transfer to a QIB
Exhibit F - Form of Transfer Certificate for Transfer to an
Institutional Accredited Investor
Exhibit G - Form of Investment Letter for Institutional Accredited
Investors
Exhibit H - Form of Transfer Certificate for Transfer to a
Non-U.S. Person
Exhibit I - Form of Investment Letter for Regulation S Purchasers
Exhibit J - Form of Registration Rights Agreement
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INDENTURE
INDENTURE dated as of February 2, 1999, among PHOENIX COLOR CORP., a
Delaware corporation (the "Issuer"), certain Subsidiaries thereof as guarantors
(the "Guarantors") and Chase Manhattan Trust Company, National Association, a
national banking association (the "Trustee").
RECITALS
The Issuer has duly authorized the creation and issue of its 10 3/8%
Senior Subordinated Notes due 2009 (the "Initial Notes") of substantially the
tenor and amount hereinafter set forth and, to provide therefor and for, if and
when issued in exchange for the Initial Notes pursuant to this Indenture and the
Registration Rights Agreement, the Issuer's 10 3/8% Senior Subordinated Notes
due 2009 (the "Exchange Notes" and together with the Initial Notes, the
"Notes"), the Issuer has duly authorized the execution and delivery of this
Indenture.
Each of the Guarantors has duly authorized the execution and delivery of
this Indenture to provide a Guarantee of the Notes and of certain of the
obligations of the Issuer hereunder.
All things necessary to make the Notes, when executed by the Issuer and
authenticated and delivered by the Trustee hereunder and duly issued by the
Issuer, the valid obligations of the Issuer, and to make this Indenture a valid
instrument of the Issuer and each of the Guarantors, in accordance with their
respective terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that for and in consideration
of the premises and the purchase of the Initial Notes by the Holders thereof, it
is mutually covenanted and agreed, for the equal and proportionate benefit of
all Holders of the Notes, as follows;
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Indebtedness" means, with respect to any Person, (i) any
Indebtedness or Disqualified Stock of any other Person existing at the time such
Person is merged with or into or becomes a Restricted Subsidiary of such
specified Person, including Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Restricted Subsidiary of such specified Person, and (ii) Indebtedness secured by
a Lien encumbering any asset acquired by such specified Person, and in either
case for purposes of this Indenture shall be deemed to be incurred by such
specified Person at the time such other Person is merged with or into or becomes
a Restricted Subsidiary of such specified Person or at the time such asset is
acquired by such specified Person, as the case may be.
"Additional Guarantee" has the meaning assigned to it in Section 11.07.
"Additional Guarantor" has the meaning assigned to it in Section 11.07.
"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, including any director or executive officer
of such specified Person. For the purposes of this definition, "control"
(including with correlative meaning, the terms "controlling," "controlled by"
and "under common control with"), when used with respect to any Person, means
(i) 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, or (ii) the beneficial ownership of 10% or more of the total voting
power of the Voting Stock (on a Fully Diluted basis) of such Person.
"Affiliate Transaction" has the meaning assigned to it in Section 4.12.
"Agent Members" has the meaning assigned to it in Section 2.06(a).
"Asset Acquisition" means (i) an Investment by the Issuer or any
Restricted Subsidiary in any other Person pursuant to which such Person shall be
merged with or into the Issuer or any Restricted Subsidiary, or (ii) the
acquisition by the Issuer or any Restricted Subsidiary of the assets of any
Person (other than a Subsidiary of the Issuer) which constitutes all or
substantially all of the assets of such person or comprises any division or line
of business of such Person or any other properties or assets of such Person
other than in the ordinary course of business.
"Asset Sale" means any direct or indirect sale, issuance, conveyance,
lease, assignment, transfer or other disposition for value (including, without
limitation, pursuant to any amalgamation, merger or consolidation or pursuant to
any sale and leaseback transaction) by the Issuer or by any of its Restricted
Subsidiaries to any Person other than the Issuer or any of its Restricted
Subsidiaries (any such transaction, a "disposition") of (i) any of the stock of
any of the Issuer's Subsidiaries, (ii) substantially all of the assets of any
division or line of business of the Issuer or of any of its Subsidiaries, or
(iii) any other assets (whether tangible or intangible) of the Issuer or of any
of its Subsidiaries; excluding (a) any disposition of Cash Equivalents or
inventory in the ordinary course of business or obsolete equipment in the
ordinary course of business consistent with past practices of the Issuer or any
of its Subsidiaries or the lease or sublease of any real or personal property in
the ordinary course of business, (b) dispositions of stock or assets the
aggregate value of which does not exceed $1,000,000 less the aggregate value of
all other dispositions of stock or assets made subsequent to the Issue Date
pursuant to this clause (b), (c) exchanges of properties or assets for other
properties or assets, excluding cash or Cash Equivalents but including the
Capital Stock of a Person if, as a result of such exchange, such Person becomes
a Restricted Subsidiary; provided, that the property or assets so acquired, or
the property or assets of the Person the Capital Stock of which is so acquired
(1) are used in a Related Business and (2) have a fair market value at least
equal to the fair market value of the assets or properties being exchanged (as
evidenced by a resolution of the Issuer's Board of Directors) and (d) for
purposes of Section 4.11 only, a disposition made in accordance with Section
4.09.
2
"Asset Sale Offer" has the meaning assigned to it in Section 4.11.
"Asset Sale Offer Amount" has the meaning assigned to it in Section 4.11.
"Asset Sale Purchase Date" has the meaning assigned to it in Section 4.11.
"Bankruptcy Law" means Title 11 of the United States Code entitled
"Bankruptcy", as now and hereafter in effect, or any successor statute or any
other United States federal, state or local law or the law of any other
jurisdiction relating to bankruptcy, insolvency, winding up, liquidation,
reorganization or relief of debtors, whether in effect on the date hereof or
hereafter.
"Blockage Notice" has the meaning assigned to it in Section 10.03.
"Board of Directors" means, as the context requires, the Board of
Directors or comparable governing body of the Issuer or the applicable
Restricted Subsidiary, as the case may be, or any committee thereof duly
authorized to act on behalf of such Board. In the case of a partnership or
limited liability company, the comparable governing body shall be partners or
members of such partnership or limited liability company or such other body as
may be duly authorized by such partners or members generally to manage the
business and affairs of the partnership or limited liability company.
"Board Resolution" means a copy of a resolution certified pursuant to an
Officers' Certificate to have been duly adopted by the Board of Directors of the
Issuer or a Guarantor, as appropriate, and to be in full force and effect, and
delivered to the Trustee.
"Business Day" means any day excluding Saturday, Sunday and any day which
is a legal holiday under the laws of New York, New York or is a day on which
banking institutions therein or banking institutions located in the city in
which the Corporate Trust Office is located are authorized or required by law or
other governmental action to close.
"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) the equity of such Person, including any
Preferred Stock, but excluding any debt securities convertible into such equity.
"Capitalized Lease Obligation" means, as to any Person, the obligations of
such Person under a lease that are required to be capitalized and accounted for
as capital lease obligations under GAAP and, for purposes of this definition,
the amount of such obligations at any date shall be the capitalized amount of
such obligations at such date, determined in accordance with GAAP.
"Cash Equivalents" means (i) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof, (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state or any public
instrumentality thereof
3
maturing within one year from the date of acquisition thereof and, at the time
of acquisition, having the highest rating obtainable from either S&P or Xxxxx'x,
(iii) commercial paper maturing no more than one year from the date of creation
thereof and, at the time of acquisition, having the highest rating obtainable
from either S&P's or Xxxxx'x, (iv) certificates of deposit or bankers'
acceptances maturing within one year from the date of acquisition thereof issued
by any commercial bank organized under the laws of the United States of America
or any state thereof or the District of Columbia that (a) is at least
"adequately capitalized" (as defined in the regulations of its primary Federal
banking regulator) and (b) has Tier 1 capital (as defined in such regulations)
of not less than $100,000,000, (v) shares of any money market mutual fund that
(a) has its assets invested continuously in the types of investments referred to
in clauses (i) and (ii) above, (b) has net assets of not less than $500,000,000,
and (c) has the highest rating obtainable from either S&P's or Xxxxx'x, and (vi)
repurchase agreements with respect to, and which are fully secured by a
perfected security interest in, obligations of a type described in clause (i) or
clause (ii) above and are with any commercial bank described in clause (iv)
above.
"Certificated Notes" means Notes in certificated form.
"Change of Control" has the meaning assigned to it in Section 4.14.
"Change of Control Offer" has the meaning assigned to it in Section 4.14.
"Change of Control Payment Date" has the meaning assigned to it in Section
4.14.
"Change of Control Purchase Price" has the meaning assigned to it in
Section 4.14.
"Consolidated Coverage Ratio" as of any date of determination means the
ratio of Consolidated EBITDA of the Issuer during the four full fiscal quarters
(the "Four Quarter Period") ending on or immediately prior to the date of the
transaction giving rise to the need to calculate the Consolidated Coverage Ratio
(the "Transaction Date") to Consolidated Fixed Charges of the Issuer for the
Four Quarter Period. In addition to and without limitation of the foregoing, for
purposes of this definition, "Consolidated EBITDA" and "Consolidated Fixed
Charges" shall be calculated after giving effect on a pro forma basis, in
accordance with Article 11 of Regulation S-X under the Securities Act, for the
period of such calculation to (i) the incurrence or repayment of any
Indebtedness of the Issuer or any of its Restricted Subsidiaries (and the
application of the proceeds thereof) giving rise to the need to make such
calculation and any incurrence or repayment of other Indebtedness (and the
application of the proceeds thereof), other than the incurrence or repayment of
Indebtedness in the ordinary course of business for working capital purposes
pursuant to working capital facilities, occurring during the Four Quarter Period
or at any time subsequent to the last day of the Four Quarter Period and on or
prior to the Transaction Date, as if such incurrence or repayment, as the case
may be (and the application of the proceeds thereof), occurred on the first day
of the Four Quarter Period and (ii) any Asset Sales or Asset Acquisitions
(including any Asset Acquisition giving rise to the need to make such
calculation as a result of the Issuer or one of its Restricted Subsidiaries
incurring, assuming or otherwise being liable for Acquired Indebtedness and also
including any Consolidated EBITDA attributable to the assets which are the
subject of the Asset Acquisition or Asset Sale during the Four Quarter Period)
occurring during the Four Quarter Period or at any
4
time subsequent to the last day of the Four Quarter Period and on or prior to
the Transaction Date, as if such Asset Sale or Asset Acquisition occurred on the
first day of the Four Quarter Period. If the Issuer or any of its Restricted
Subsidiaries directly or indirectly guarantees Indebtedness of a third Person,
the preceding sentence shall give effect to the incurrence of such guaranteed
Indebtedness as if the Issuer or such Restricted Subsidiary, as the case may be,
had directly incurred or otherwise assumed such guaranteed Indebtedness.
Furthermore, in calculating "Consolidated Fixed Charges" for purposes of
determining the denominator of this "Consolidated Coverage Ratio," (a) interest
on outstanding Indebtedness determined on a fluctuating basis as of the
Transaction Date and which will continue to be so determined thereafter shall be
deemed to have accrued at a fixed rate per annum equal to the rate of interest
on such Indebtedness in effect on the Transaction Date, (b) if interest on any
Indebtedness actually incurred on the Transaction Date may optionally be
determined at an interest rate based upon a factor of a prime or similar rate, a
eurocurrency interbank offered rate, or other rates, then the interest rate in
effect on the Transaction Date will be deemed to have been in effect during the
Four Quarter Period, and (c) notwithstanding clause (a) above, interest on
Indebtedness determined on a fluctuating basis, to the extent such interest is
covered by agreements relating to Interest Rate Protection Agreements shall be
deemed to accrue at the rate per annum resulting after giving effect to the
operation of such agreements.
"Consolidated EBITDA" means, with respect to the Issuer for any period,
the sum, without duplication, of (i) Consolidated Net Income and (ii) to the
extent Consolidated Net Income has been reduced thereby, (a) all income taxes of
the Issuer and its Restricted Subsidiaries paid or accrued in accordance with
GAAP for such period (other than income taxes attributable to extraordinary,
unusual or nonrecurring gains or losses or taxes attributable to sales or
dispositions outside the ordinary course of business), (b) Consolidated Interest
Expense and (c) Consolidated Non-Cash Charges less any non-cash items increasing
Consolidated Net Income for such period, all as determined on a consolidated
basis for the Issuer and its Restricted Subsidiaries in accordance with GAAP.
"Consolidated Fixed Charges" means, with respect to the Issuer for any
period, the sum, without duplication, of (i) Consolidated Interest Expense
(including any premium or penalty paid in connection with redeeming or retiring
Indebtedness of the Issuer and its Restricted Subsidiaries prior to the stated
maturity thereof pursuant to the agreements governing such Indebtedness), plus
(ii) the product of (a) the amount of all dividend payments on any series of
Preferred Stock of the Issuer (other than dividends paid in Capital Stock that
is not Disqualified Stock) paid, accrued or scheduled to be paid or accrued
during such period times (b) a fraction, the numerator of which is one and the
denominator of which is one minus the then-current effective consolidated
federal, state and local income tax rate of the Issuer, expressed as a decimal.
"Consolidated Interest Expense" means, with respect to the Issuer for any
period, the sum without duplication of: (i) the aggregate of all cash and
non-cash interest expense (minus amortization or write-off of deferred financing
costs included in cash or non-cash interest expense) of the Issuer and its
Restricted Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP, including (a) any amortization of debt discount, (b) the
net costs under Interest Rate Protection Agreements, (c) all capitalized
interest and (d) the
5
interest portion of any deferred payment obligation, and (ii) the interest
component of Capitalized Lease Obligations paid, accrued and/or scheduled to be
paid or accrued by the Issuer and its Restricted Subsidiaries during such period
as determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Income" means, for any period, the aggregate net income
(or loss) of the Issuer and its Restricted Subsidiaries for such period on a
consolidated basis, determined in accordance with GAAP; provided, that there
shall be excluded therefrom (i) after-tax gains and losses from Asset Sales or
abandonment or reserves relating thereto, (ii) items classified as
extraordinary, nonrecurring or unusual gains, losses or charges, and the related
tax effects, each determined in accordance with GAAP, (iii) the net income of
any Person acquired in a "pooling of interests" transaction accrued prior to the
date it becomes a Restricted Subsidiary of the Issuer or is merged or
consolidated with the Issuer or any Restricted Subsidiary of the Issuer, (iv)
the net income (but not loss) of any Restricted Subsidiary of the Issuer to the
extent that the declaration of dividends or similar distributions by that
Restricted Subsidiary of that income is restricted by a contract, operation of
law or otherwise, (v) the net income of any Person, other than a Restricted
Subsidiary of the Issuer, except to the extent of cash dividends or
distributions paid to the Issuer or to a Restricted Subsidiary of the Issuer by
such Person, (vi) any restoration to income of any contingency reserve, except
to the extent that provision for such reserve was made out of Consolidated Net
Income accrued at any time after September 30, 1998, (vii) income or loss
attributable to discontinued operations (including operations disposed of during
such period whether or not such operations were classified as discontinued), and
(viii) in the case of a successor to the Issuer by consolidation or merger or as
a transferee of the Issuer's assets, any earnings of the successor corporation
prior to such consolidation, merger or transfer of assets.
"Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Issuer and its consolidated Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, as of the end of the
most recent fiscal quarter of the Issuer ending at least forty-five (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 Issuer 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.
"Consolidated Non-Cash Charges" means with respect to the Issuer, for any
period, the aggregate depreciation, amortization and other non-cash expenses of
the Issuer and its Restricted Subsidiaries reducing Consolidated Net Income of
the Issuer for such period, determined on a consolidated basis in accordance
with GAAP (excluding any such charges constituting an extraordinary item or loss
or any such charge which requires an accrual of or a reserve for cash charges
for any future period).
"Corporate Trust Office" means the office of the Trustee at which at any
particular time this Indenture shall be principally administered, which office
is, at the date of execution of this Indenture, 0000 Xxxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxxxxx, XX 00000, Attention: Capital
6
Market Fiduciary Services (Phoenix Color Corp. 10 3/8% Senior Subordinated Notes
due 2009).
"Custodian" means any receiver, trustee, assignee, liquidator, custodian
or similar official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage of time or
both would be, an Event of Default.
"Defaulted Interest" has the meaning set forth in Section 2.12 hereof.
"Depositary" means The Depository Trust Company, its nominees, and their
respective successors.
"Designated Senior Indebtedness" means, in respect of the Issuer, the
Senior Credit Facility and any other Senior Indebtedness of the Issuer 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, at least $5,000,000 and is specifically designated by the Issuer in
the instrument evidencing or governing such Senior Indebtedness as "Designated
Senior Indebtedness" and, in respect of any Guarantor, any Guarantee by such
Guarantor of Designated Senior Indebtedness of the Issuer.
"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 for any reason, (ii) is convertible or exchangeable
for Indebtedness or Disqualified Stock or (iii) is redeemable at the option of
the holder thereof, in whole or in part, in each case on or prior to the first
anniversary of the Stated Maturity of the Notes; provided, however, that any
Capital Stock that would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require such Person to repurchase or
redeem such Capital Stock upon the occurrence of an Asset Sale or Change of
Control occurring prior to the first anniversary of the Stated Maturity of the
Notes shall not constitute Disqualified Stock if the "asset sale" or "change of
control" provisions applicable to such Capital Stock are not more favorable to
the holders of such Capital Stock than the provisions described under Section
4.11 and Section 4.14.
"Event of Default" has the meaning assigned to it in Section 6.01.
"Excess Proceeds" has the meaning assigned to it in Section 4.11.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Certificated Notes" has the meaning assigned to it in Section
2.01.
"Exchange Global Note" has the meaning assigned to it in Section 2.01.
"Exchange Note" has the meaning assigned to it in the recital hereto.
7
"Fully Diluted" means all shares of Common Stock, computed as if all
warrants, options and other securities exercisable for, convertible into or
otherwise having the right to acquire Common Stock had been exercised or
converted.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect as of the Issue Date, including those set forth (i) in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (ii) in statements and
pronouncements of the Financial Accounting Standards Board, (iii) in such other
statements by such other entity as approved by a significant segment of the
accounting profession, and (iv) in the published rules and regulations of the
Commission governing the inclusion of financial statements (including pro forma
financial statements) in periodic reports required to be filed pursuant to
Section 13 of the Exchange Act, including opinions and pronouncements in staff
accounting bulletins and similar written statements from the accounting staff of
the Commission.
"Global Notes" means the Initial Global Note and the Exchange Global Note.
"Guarantee" means the Guarantee of the Notes by each Guarantor under
Article 11 hereof.
"Guarantor" means each Subsidiary of the Issuer identified as a Guarantor
on the signature pages hereto and each Additional Guarantor.
"Holder" or "Noteholder" means the Person in whose name a Note is
registered on the Registrar's books.
"incur" means issue, assume, guarantee, incur or otherwise become liable
for; provided, that any Indebtedness or Capital Stock of a Person existing at
the time such Person becomes a Restricted Subsidiary (whether by merger,
consolidation, acquisition or otherwise) shall be deemed to be incurred by such
Subsidiary at the time it becomes a Restricted Subsidiary. 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, (i) all indebtedness, obligations and liabilities of such Person
for borrowed money, (ii) all indebtedness, obligations and liabilities of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all indebtedness, obligations and liabilities of such Person evidenced by
Capitalized Lease Obligations, (iv) all indebtedness, obligations and
liabilities of such Person evidenced by notes payable and drafts accepted
representing extensions of credit, whether or not representing obligations for
borrowed money, of such Person, (v) all indebtedness, obligations or liabilities
of such Person owed for all or any part of the deferred purchase price of
property or services (excluding any such obligations incurred under ERISA),
which purchase price is (a) due more than six months (or a longer period of up
to one year, if such terms are available from suppliers in the ordinary course
of business) from the date of incurrence of the obligation in respect thereof or
(b) evidenced by a note or similar written instrument, (vi) all indebtedness,
obligations and liabilities secured by any Lien on any property
8
or asset owned or held by that Person (including any Lien arising under any
conditional sale or other title retention agreement, any sale-leaseback
arrangement or any other lease in the nature thereof and any agreement to give
any security interest) regardless of whether the indebtedness secured thereby
shall have been assumed by that Person or is nonrecourse to the credit of that
Person except that "Indebtedness" shall not include trade payables and accrued
liabilities incurred in the ordinary course of business for the purchase of
goods or services which are not secured by a Lien other than a Lien permitted
pursuant to clause (viii) of the definition of Permitted Liens and obligations
under Interest Rate Protection Agreements, (vii) guarantee obligations of such
Person in respect of Indebtedness of other Persons and (viii) all Disqualified
Stock issued by such Person with the amount of Indebtedness represented by such
Disqualified Stock being equal to the greater of its voluntary or involuntary
liquidation preference and its maximum fixed repurchase price, but excluding
accrued dividends, if any. For purposes hereof, the "maximum fixed repurchase
price" of any Disqualified Stock which does not have a fixed repurchase price
shall be calculated in accordance with the terms of such Disqualified Stock as
if such Disqualified Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to this Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified Stock,
such fair market value to be determined reasonably and in good faith by the
board of directors of the issuer of such Disqualified Stock.
"Indenture" means this Indenture as amended or supplemented from time to
time.
"Initial Certificated Notes" has the meaning assigned to it in Section
2.01.
"Initial Global Note" has the meaning assigned to it in Section 2.01.
"Initial Notes" has the meaning assigned to it in the recital hereto.
"Initial Purchaser" means First Union Capital Markets Corp., which prior
to February 1, 1999 was known as First Union Capital Markets, a division of
Wheat First Securities, Inc.
"Insolvency or Liquidation Proceeding" means (i) any insolvency or
bankruptcy case or proceeding, or any receivership, liquidation, reorganization
or other similar case or proceeding in connection therewith, relating to the
Issuer or its assets, or (ii) any liquidation, dissolution or other winding up
of the Issuer, whether voluntary or involuntary or whether or not involving
insolvency or bankruptcy, or (iii) any assignment for the benefit of creditors
or any other marshaling of assets or liabilities of the Issuer.
"Institutional Accredited Investors" means institutional "accredited
investors," as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act, other than QIBs.
"Interest Payment Date" means each semiannual Interest Payment Date on
February 1 and August 1 of each year, commencing August 1, 1999, in respect of
the Notes.
"Interest Rate Protection Agreement" of any Person means any interest rate
protection agreement (including interest rate swaps, caps, floors, collars,
derivative instruments and similar agreements) in support of the Issuer's
business and not of a speculative nature.
9
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are,
in conformity with GAAP, recorded as accounts receivable on the balance sheet of
such Person) or other extensions of credit (including by way of a guarantee
obligation 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 4.09, (i) "Investment" shall include the
portion (proportionate to the Issuer's equity interest in such Subsidiary) of
the fair market value of the net assets of any Subsidiary of the Issuer at the
time that such Subsidiary is designated an Unrestricted Subsidiary; provided,
that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the
Issuer shall be deemed to continue to have a permanent "Investment" in an
Unrestricted Subsidiary equal to an amount (if positive) equal to (a) the
Issuer's "Investment" in such Unrestricted Subsidiary at the time of such
redesignation as a Restricted Subsidiary less (b) the portion (proportionate to
the Issuer's equity interest in such Unrestricted Subsidiary) of the fair market
value of the net assets of such Unrestricted Subsidiary at the time of such
redesignation as a Restricted Subsidiary, 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 Notes are originally issued.
"Issuer" means the party named as such in this Indenture until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained herein and required by the TIA, each other obligor on the
indenture securities.
"Issuer Order" means a written order signed in the name of the Issuer by
(i) the Chairman of the Board, Chief Executive Officer, President, Chief
Financial Officer or any Vice President of the Issuer and (ii) the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary of the Issuer, and
delivered to the Trustee.
"Legal Holiday" has the meaning assigned to it in Section 13.08.
"Lien" means any mortgage, pledge, assignment, security interest,
encumbrance, lien or charge of any kind (including any conditional sale or other
title retention agreement, any sale-leaseback arrangement or any other lease in
the nature thereof and any agreement to give any security interest) and any
option, trust or other preferential arrangement having the practical effect of
any of the foregoing.
"Liquidated Damages" has the meaning assigned to it in the Registration
Rights Agreement.
"Moody's" means Xxxxx'x Investors Service, Inc. and its successors.
10
"Net Available Cash" means, with respect to any Asset Sale, payments in
cash or Cash Equivalents received therefrom, net of bona fide direct costs of
sale, including, but not limited to, (i) income taxes reasonably estimated to be
actually payable as a result of such Asset Sale within two years of the date of
such Asset Sale, (ii) payment of the outstanding principal amount of, premium or
penalty, if any, and interest on, any Indebtedness that is secured by a Lien on
the stock or assets in question and that is required to be repaid under the
terms thereof as a result of such Asset Sale, (iii) out-of-pocket expenses and
fees relating to such Asset Sale (including legal, accounting and investment
banking fees and sales commissions) and (iv) any portion of cash proceeds which
the Issuer determines in good faith should be reserved for post-closing
adjustments or liabilities relating to the Asset Sale retained by the Issuer or
any of its Restricted Subsidiaries, it being understood and agreed that on the
day that all such post-closing adjustments have been finally determined, the
amount (if any) by which the reserved amount in respect of such Asset Sale
exceeds the actual post-closing adjustments, payable by the Issuer or any of its
Restricted Subsidiaries, shall constitute Net Available Cash on such date.
"Net Cash Proceeds" with respect to any issuance or sale of Capital Stock,
mean the proceeds of such issuance or sale in the form of cash or Cash
Equivalents 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 any Person who is not a "U.S. Person," as
defined in Rule 902(k) under the Securities Act.
"Note Register" has the meaning assigned to it in Section 2.03.
"Notes" has the meaning assigned to it in the recital hereto.
"Notice of Default" has the meaning assigned to it in Section 6.01.
"Obligation" has the meaning assigned to it in Section 11.01.
"Officer" means the Chairman of the Board, the President, Chief Financial
Officer, any Vice President, the Treasurer, or the Secretary of the Issuer or
any Restricted Subsidiary, as the case may be (or, in the case of any Restricted
Subsidiary that is not a corporation, the respective Persons having the duties
and authority correlative to the foregoing officers of a corporation).
"Officers' Certificate" means a certificate signed by two Officers.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee.
"Paying Agent" has the meaning assigned to it in Section 2.03.
"Payment Blockage Period" has the meaning assigned to it in Section 10.03.
11
"Permitted Holders" means any or all of Xxxxx XxXxxxx, Xxxxxx Xxxxxxxxx
and the Issuer's Stock Bonus Plan (so long as Xxxxx XxXxxxx and Xxxxxx Xxxxxxxxx
are the sole trustees of such Stock Bonus Plan).
"Permitted Indebtedness" means each of the following:
(i) Indebtedness under the Notes, this Indenture and the Guarantees;
(ii) Indebtedness under the Senior Credit Facility; provided, that the
aggregate principal amount of Indebtedness outstanding under the Senior Credit
Facility at any one time shall not exceed the greater of (a) $20.0 million or
(b) the Borrowing Base (as defined in the Senior Credit Facility);
(iii) other Indebtedness of the Issuer and its Restricted Subsidiaries
outstanding on the Issue Date reduced by the amount of any scheduled
amortization payments or mandatory prepayments when actually paid or permanent
reductions thereon;
(iv) Interest Rate Protection Agreements of the Issuer covering
Indebtedness of the Issuer or any of its Restricted Subsidiaries and Interest
Rate Protection Agreements of any Restricted Subsidiary covering Indebtedness of
such Restricted Subsidiary; provided, that (a) such Interest Rate Protection
Agreements are entered into to protect the Issuer and its Subsidiaries from
fluctuations in interest rates on Indebtedness incurred either in accordance
with this Indenture or in accordance with the Senior Credit Facility to the
extent the notional principal amount of such Interest Rate Protection Agreements
does not exceed the principal amount of the Indebtedness to which such Interest
Rate Protection Agreements relates and (b) such Interest Rate Protection
Agreements do not increase the Indebtedness of the Issuer and its Restricted
Subsidiaries outstanding other than by reason of fees, indemnities and
compensation payable thereunder;
(v) Indebtedness of a Restricted Subsidiary to the Issuer or to a
Restricted Subsidiary for so long as such Indebtedness is held by the Issuer or
a Restricted Subsidiary, in each case subject to no Lien held by a Person other
than the Issuer or a Restricted Subsidiary; provided that if as of any date any
Person other than the Issuer or a Restricted Subsidiary owns or holds any such
Indebtedness or holds a Lien in respect of such Indebtedness, such date shall be
deemed the incurrence of Indebtedness not constituting Permitted Indebtedness by
the issuer of such Indebtedness;
(vi) Indebtedness of the Issuer to Restricted Subsidiary for so long as
such Indebtedness is held by Restricted Subsidiary, subject to no Lien; provided
that (a) any Indebtedness of the Issuer to any Restricted Subsidiary is
unsecured and subordinated, pursuant to a written agreement, to the Issuer's
obligations under the Notes and (b) if as of any date any Person other than a
Restricted Subsidiary owns or holds any such Indebtedness or any Person holds a
Lien in respect of such Indebtedness, such date shall be deemed the incurrence
of Indebtedness not constituting Permitted Indebtedness by the Issuer;
12
(vii) 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 day-light overdrafts) drawn against insufficient funds in the ordinary
course of business; provided, that such Indebtedness is extinguished within two
business days of incurrence;
(viii) Indebtedness of the Issuer or any of its Restricted Subsidiaries
represented by letters of credit for the account of the Issuer or such
Restricted Subsidiary, as the case may be, in order to provide security for
workers' compensation claims, payment obligations in connection with
self-insurance or similar requirements in the ordinary course of business;
(ix) Refinancing Indebtedness incurred in respect of Indebtedness
originally incurred pursuant to the second sentence of Section 4.08 or pursuant
to this clause (ix) or clause (i) or (ii) of this definition;
(x) Additional Indebtedness of the Issuer and its Restricted Subsidiaries
in an aggregate principal amount not to exceed $5,000,000 at any one time
outstanding for Capitalized Lease Obligations or for purposes of financing the
purchase price or construction cost of equipment, fixtures or similar property;
and
(xi) Additional Indebtedness of the Issuer and its Restricted Subsidiaries
in an aggregate principal amount not to exceed $5,000,000 at any one time
outstanding.
"Permitted Investment" means any of the following:
(i) Investments by the Issuer or any Restricted Subsidiary in any Person
that is or will become immediately after such Investment a Restricted Subsidiary
or that will merge or consolidate into the Issuer or a Restricted Subsidiary;
(ii) Investments in the Issuer by any Restricted Subsidiary; provided that
any Indebtedness evidencing such Investment is unsecured and subordinated,
pursuant to a written agreement, to the Issuer's obligations under the Notes and
this Indenture;
(iii) Investments in cash and Cash Equivalents;
(iv) loans and advances to employees and officers of the Issuer and its
Subsidiaries in the ordinary course of business for bona fide business purposes
not, in the aggregate, in excess of $1,000,000 at any one time outstanding;
(v) Interest Rate Protection Agreements entered into in the ordinary
course of the Issuer's or its Restricted Subsidiaries' businesses and otherwise
in compliance with this Indenture;
(vi) Investments in securities of trade creditors or customers received
pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such trade creditors or customers;
13
(vii) consideration other than cash or Cash Equivalents received by the
Issuer or its Restricted Subsidiaries in connection with an Asset Sale made in
compliance with Section 4.11; and
(viii) Investments not to exceed $1,000,000 at any one time outstanding.
"Permitted Liens" means any of the following:
(i) Liens for taxes, assessments or governmental charges or claims either
(a) not delinquent or (b) contested in good faith by appropriate proceedings and
as to which the Issuer or the Subsidiaries shall have set aside on its books
such reserves as may be required pursuant to GAAP;
(ii) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, suppliers, materialmen, repairmen and other Liens imposed by law
incurred in the ordinary course of business for sums not yet delinquent or being
contested in good faith, if such reserve or other appropriate provision, if any,
as shall be required by GAAP shall have been made in respect thereof,
(iii) Liens incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security, including any Lien securing letters of credit issued in the
ordinary course of business consistent with past practice in connection
therewith, or to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government performance and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);
(iv) judgment Liens not giving rise to an Event of Default so long as such
Lien is adequately bonded and any appropriate legal proceedings which may have
been duly initiated for the review of such judgment shall not have been finally
terminated or the period within which such proceedings may be initiated shall
not have expired;
(v) easements, rights-of-way zoning restrictions and other similar charges
or encumbrances in respect of real property not interfering in any material
respect with the ordinary conduct of the business of the Issuer or any of its
Subsidiaries;
(vi) any interest or title of a lessor under any Capitalized Lease
Obligation; provided that such Liens do not extend to any property or assets
which is not leased property subject to such Capitalized Lease Obligation;
(vii) purchase money Liens to finance property or assets of the Issuer or
a Restricted Subsidiary acquired in the ordinary course of business; provided,
that (a) the related purchase money Indebtedness shall not exceed the cost of
such property or assets and shall not be secured by any property or assets of
the Issuer or any Restricted Subsidiary other than the property and assets so
acquired and (b) the Lien securing such Indebtedness shall be created within 90
days of such acquisition;
14
(viii) Liens upon specific items of inventory or other goods and proceeds
of any Person securing such Person's obligations in respect of bankers'
acceptances issued or created for the account of such Person to facilitate the
purchase, shipment or storage of such inventory or other goods;
(ix) Liens securing reimbursement obligations with respect to commercial
letters of credit which encumber documents and other property relating to such
letters of credit and products and proceeds thereof,
(x) Liens encumbering deposits made to secure obligations arising from
statutory, regulatory, contractual, or warranty requirements of the Issuer or a
Restricted Subsidiary, including rights of offset and set-off,
(xi) Liens securing Interest Rate Protection Agreements which Interest
Rate Protection Agreements relate to Indebtedness that is incurred under this
Indenture or the Senior Credit Facility;
(xii) Liens securing Indebtedness under the Senior Credit Facility or
pursuant to clause (xi) of the definition of "Permitted Indebtedness";
(xiii) Liens existing on the Issue Date and Liens to secure any
Refinancing Indebtedness which is incurred to refinance any Indebtedness which
has been secured by a Lien permitted under Section 4.15 and which Indebtedness
has been incurred in accordance with Section 4.08; provided that such new Liens
(a) are no less favorable to the Holders of Notes and are not more favorable to
the lienholders with respect to such Liens than the Liens in respect of the
Indebtedness being refinanced and (b) do not extend to any property or assets
other than the property or assets securing the Indebtedness refinanced or
replaced by such Refinancing Indebtedness; and
(xiv) Liens securing Acquired Indebtedness incurred in accordance with the
second sentence of Section 4.08; provided that (a) such Liens secured such
Acquired Indebtedness at the time of and prior to the incurrence of such
Acquired Indebtedness by the Issuer or a Restricted Subsidiary and were not
granted in connection with, or in anticipation of the incurrence of such
Acquired Indebtedness by the Issuer or a Restricted Subsidiary and (b) such
Liens do not extend to or cover any property or assets of the Issuer or any
Restricted Subsidiary other than the property or assets that secured the
Acquired Indebtedness prior to the time such Indebtedness became Acquired
Indebtedness of the Issuer or a Restricted Subsidiary and are no more favorable
to the lienholders than the Liens securing the Acquired Indebtedness prior to
the incurrence of such Acquired Indebtedness by the Issuer or a Restricted
Subsidiary.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.
15
"Post-Petition Interest" means all interest accrued or accruing after the
commencement of any Insolvency or Liquidation Proceeding (and interest that
would accrue but for the commencement of any Insolvency or Liquidation
Proceeding) in accordance with and at the contract rate (including any rate
applicable upon default) specified in the agreement or instrument creating,
evidencing or governing any Indebtedness, whether or not, pursuant to applicable
law or otherwise, the claim for such interest is allowed as a claim in such
Insolvency or Liquidation Proceeding.
"Preferred Stock" means, as applied to the Capital Stock of any
corporation, 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.
"Private Placement Legend" has the meaning assigned to it in Section 2.01.
"Property" means, with respect to any Person, any interest of such Person
in any kind of property or asset, whether real, personal or mixed, tangible or
intangible.
"Public Equity Offering" means an underwritten primary public offering of
any class of common stock of the Issuer pursuant to an effective registration
statement under the Securities Act.
"Public Market" means any time after (i) an underwritten Public Equity
Offering of the Issuer has been consummated and (ii) at least 10% of the total
issued and outstanding common stock of the Issuer (as determined on a Fully
Diluted basis) 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 Agreement" means the purchase agreement relating to the Notes,
dated January 28, 1999, among the Issuer, the Guarantors and the Initial
Purchaser.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Record Date" means, for the interest payable on any Interest Payment
Date, the date specified in Section 2.12 hereof.
"Redemption Date" means, when used with respect to any Note or part
thereof to be redeemed hereunder, the date fixed for redemption of such Notes
pursuant to the terms of the Notes and this Indenture.
"Redemption Price" means, when used with respect to any Note or part
thereof to be redeemed hereunder, the price fixed for redemption of such Note
pursuant to the terms of the Notes and this Indenture, plus accrued and unpaid
interest thereon, if any, and Liquidated Damages, if any, to the Redemption
Date.
16
"Refinancing Indebtedness" means any Indebtedness of the Issuer or any of
its Restricted Subsidiaries issued in exchange for, or the net proceeds of which
are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of the Issuer or any of its Restricted Subsidiaries; provided that:
(i) the principal amount of such Refinancing Indebtedness does not exceed the
principal amount of the Indebtedness so extended, refinanced, renewed, replaced,
defeased or refunded (plus the amount of reasonable expenses incurred in
connection therewith), (ii) such Refinancing Indebtedness has a Weighted Average
Life to Maturity equal to or greater than the Weighted Average Life to Maturity
of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded, (iii) if the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded is subordinated in right of payment to the Notes,
such Refinancing Indebtedness has a final maturity date later than the final
maturity date of, and is subordinated in right of payment to, the Notes on terms
at least as favorable to the Holders of Notes as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded, and (iv) such Indebtedness is incurred either by
the Issuer or by the Restricted Subsidiary of the Issuer that is the obligor on
the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded.
"Registered Exchange Offer" has the meaning set forth in the Registration
Rights Agreement.
"Registrar" has the meaning assigned to it in Section 2.03.
"Registration Rights Agreement" means the Registration Rights Agreement
relating to the Notes, dated February 2, 1999 among the Issuer, the Guarantors
and the Initial Purchaser, in substantially the form of Exhibit J hereto.
"Regulation S" means Regulation S under the Securities Act (including any
successor regulation thereto), as it may be amended from time to time.
"Related Business" means the businesses of the Issuer and the Restricted
Subsidiaries on the Issue Date and any business related, ancillary or
complementary to the businesses of the Issuer 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 Issuer.
"Restricted Payment" with respect to any Person means (i) the declaration
or payment of any dividends or any other distributions in respect of its Capital
Stock (including any payment in connection with any merger or consolidation
involving such Person) or similar payment to the direct or indirect holders of
its Capital Stock (other than dividends or distributions payable solely in its
Capital Stock (other than Disqualified Stock) and dividends or distributions
payable solely to the Issuer or a Restricted Subsidiary, and other than pro rata
dividends or other distributions made by a Restricted Subsidiary to minority
stockholders (or owners of an equivalent interest in the case of a Subsidiary
that is an entity other than a corporation)), (ii) the purchase, redemption or
other acquisition or retirement for value of any Capital Stock of the Issuer or
any Restricted Subsidiary held by any Person (other than the Issuer or a
Restricted Subsidiary), or any warrants,
17
rights or options to acquire shares of any class of such Capital 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 Subsidiary" means any Subsidiary of the Issuer that is not an
Unrestricted Subsidiary.
"Rule 144" means Rule 144 under the Securities Act (including any
successor regulation thereto), as it may be amended from time to time.
"Rule 144A" means Rule 144A under the Securities Act (including any
successor regulation thereto), as it may be amended from time to time.
"S&P" means Standard & Poor's Rating Services, a division of The
XxXxxx-Xxxx Companies, Inc., and its successors.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Credit Facility" means the Credit Agreement, dated as of September
15, 1998, among the Issuer, the lenders who are or may become party thereto
listed therein and First Union National Bank, as administrative agent, together
with the documents related thereto (including any guarantee agreements and
security documents), in each case as such agreements may be amended (including
any amendment and restatement thereof), supplemented or otherwise modified from
time to time, including any agreement extending the maturity of, refinancing,
increasing, replacing or otherwise restructuring (including adding Subsidiaries
of the Issuer as additional borrowers or guarantors thereunder) all or any
portion of the Indebtedness under such agreement or any successor or replacement
agreement and whether by the same or any other agent, lender or group of
lenders.
"Senior Indebtedness" means with respect to any Person, (i) Indebtedness
of such Person, whether outstanding on the Issue Date or thereafter incurred,
and (ii) accrued and unpaid interest (including Post-Petition Interest) 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 unless, in the
instrument creating or evidencing any of the obligations referred to in clauses
(i) or (ii) or pursuant to which any such obligations are outstanding, it is
provided that such obligations are subordinate in right of payment to the Notes;
provided, however, that Senior Indebtedness shall not include (1) any obligation
of such Person to any Subsidiary, (2) any liability for Federal, state, local or
other taxes owed or owing by such Person, (3) any accounts payable or other
18
liability to trade creditors arising in the ordinary course of business
(including guarantees thereof or instruments evidencing such liabilities), (4)
any Indebtedness of such Person (and any accrued and unpaid interest in respect
thereof) which is subordinate or junior in any respect to any other Indebtedness
or other obligation of such Person or (5) that portion of any Indebtedness which
at the time of incurrence is incurred in violation of Section 4.08.
"Shelf Registration Statement" has the meaning set forth in the
Registration Rights Agreement.
"Special Record Date" means a date fixed by the Trustee pursuant to
Section 2.12 for the payment of Defaulted Interest.
"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 the happening of any
contingency unless such contingency has occurred).
"Subordinated Obligation" means any Indebtedness of the Issuer or a
Restricted Subsidiary of the Issuer (whether outstanding on the Issue Date or
thereafter incurred) which is subordinate or junior in right of payment to the
Notes or the Guarantees pursuant to a written agreement to that effect.
"Subordinated Reorganization Securities" has the meaning assigned to it
in Section 10.02.
"Subsidiary" means, in respect of any Person, any corporation, limited
liability company, association, partnership or other business entity of which
more than fifty percent (50%) of the total Voting Stock or other interests
(including partnership and membership 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.
"Successor Company" has the meaning assigned to it in Section 5.01.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of this Indenture.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.
"Trust Officer" means any officer in the Corporate Trust Office of the
Trustee assigned by the Trustee to administer its corporate trust matters.
19
"Uniform Commercial Code" means the New York Uniform Commercial Code in
effect from time to time.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Issuer that at
the time of determination shall be designated an Unrestricted Subsidiary by the
Board of Directors in the manner provided below and (ii) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary of
the Issuer (including any newly acquired or newly formed Subsidiary) to be an
Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns
any Capital Stock or Indebtedness of, or holds any Lien on any property of, the
Issuer or any other Subsidiary of the Issuer that is not a Subsidiary of the
Subsidiary to be so designated; provided, that (a) either (1) the Subsidiary to
be so designated has total assets of $1,000 or less or (2) if such Subsidiary
has assets greater than $1,000, such designation would be permitted under
Section 4.09 and (b) such Subsidiary to be so designated and each of its
Subsidiaries has not at the time of such designation, and does not thereafter,
incur any Indebtedness pursuant to which the lender has recourse to any of the
assets or properties of the Issuer or any of its Restricted Subsidiaries. The
Board of Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided, that immediately after giving effect to such designation
(x) the Issuer could incur $1.00 of additional Indebtedness pursuant to the
second sentence of Section 4.08 and (y) no Default shall have occurred and be
continuing. Any such designation by the Board of Directors shall be evidenced by
the Issuer to the Trustee by promptly filing with the Trustee a copy of the
board resolution giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the foregoing provisions.
"U.S. Government Obligation" 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 or member 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.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing (i) the sum
of the product obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payments at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
SECTION 1.02. 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.
20
"indenture securities" means the Notes; "indenture security holder" means
a Noteholder; "indenture to be qualified" means this Indenture; "indenture
trustee" or "institutional trustee" means the Trustee;
"obligor" on the indenture securities means the Issuer 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 1.03. Rules of Construction. Unless the context otherwise
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(c) "or" is not exclusive;
(d) "including" means including without limitation;
(e) words in the singular include the plural and words in the plural
include the singular;
(f) unsecured Indebtedness shall not be deemed to be subordinate or junior
to Secured Indebtedness merely by virtue of its nature as unsecured
Indebtedness;
(g) the principal amount of any noninterest bearing or other discount
security at any date shall be the principal amount thereof that would be shown
on a balance sheet of the issuer dated such date prepared in accordance with
GAAP and accretion of principal on such security shall be deemed to be the
incurrence of Indebtedness;
(h) the principal amount of any Preferred Stock shall be (i) the maximum
liquidation value of such Preferred Stock or (ii) the maximum mandatory
redemption or mandatory repurchase price with respect to such Preferred Stock,
whichever is greater; and
(i) all references to the date the Notes were originally issued shall
refer to the date the Initial Notes were originally issued.
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ARTICLE 2
THE NOTES
SECTION 2.01. Form and Dating.
(a) The Initial Notes and the certificate of authentication of the Trustee
thereon shall be substantially in the form of Exhibit A or Exhibit B hereto, as
applicable, which are hereby incorporated in and expressly made a part of this
Indenture. The Exchange Notes and the certificate of authentication of the
Trustee thereon shall be substantially in the form of Exhibit C or Exhibit D
hereto, as applicable, which are hereby incorporated in and expressly made a
part of this Indenture.
(b) The Notes may have such letters, numbers or other marks of
identification and such legends and endorsements, stamped, printed, lithographed
or engraved thereon, (i) as the Issuer may deem appropriate and as are not
inconsistent with the provisions of this Indenture, (ii) as may be required to
comply with this Indenture, any law or any rule of any securities exchange on
which the Notes may be listed and (iii) as may be necessary to conform to
customary usage. Each Note shall be dated the date of its authentication by the
Trustee. The Notes shall be issued only in fully registered form, without
coupons, in denominations of $1,000 and integral multiples thereof; provided
that Initial Certificated Notes transferred to Institutional Accredited
Investors shall be subject to a minimum denomination of $250,000. Definitive
Notes shall be typed, printed, lithographed or engraved or produced by any
combination of such methods or produced in any other manner permitted by the
rules of any securities exchange on which such Notes may be listed, all as
determined by the officers of the Issuer executing such Notes, as evidenced by
their execution of such Notes.
(c) Initial Notes offered and sold to QIBs in reliance on Rule 144A or
Non-U.S. Persons in reliance on Regulation S as provided in the Purchase
Agreement shall be issued initially in the form of a single, permanent global
note in definitive, fully registered form, without coupons, substantially in the
form set forth in Exhibit A hereto and shall bear the legends set forth in
Section 2.01(e)(i), Section 2.01(e)(ii) and Section 2.01(e)(iii) hereof (the
"Initial Global Note"). Upon issuance, such Initial Global Note shall be
registered in the name of the Depositary or its nominee, duly executed by the
Issuer and authenticated by the Trustee as hereinafter provided and deposited on
behalf of the purchasers of the Initial Notes represented thereby with the
Trustee at its designated office, as custodian for the Depositary. Owners of
beneficial interests in the Initial Global Note shall be entitled to receive
physical delivery of Initial Certificated Notes pursuant to Section 2.07(b)(ii).
Initial Notes offered and sold to Institutional Accredited Investors shall be
issued in the form of a note in definitive, fully registered form, without
coupons, substantially in the form set forth in Exhibit B hereto and shall bear
the legend set forth in Section 2.01(e)(i) hereof, except as provided in Section
2.07(a) (such Notes together with interests in the Initial Global Note that are
subsequently transferred or exchanged pursuant to Section 2.07(b)(ii),
2.07(b)(iii), 2.07(b)(iv) or 2.07(c), the "Initial Certificated Notes"). Upon
issuance, any such Initial Certificated Note shall be duly executed by the
Issuer and authenticated by the Trustee as hereinafter provided. Upon transfer
of any Initial Certificated Note to a QIB pursuant to Section 2.07(b)(i) hereof,
such Initial Certificated Note
22
may be exchanged for a beneficial interest in the Initial Global Note, except as
provided in Section 2.07(c).
(d) If the Initial Global Note is tendered in a Registered Exchange Offer,
it shall be exchanged for a single, permanent global note in definitive, fully
registered form, without coupons, substantially in the form set forth in Exhibit
C hereto and shall bear the legends set forth in Section 2.01(e)(ii) and Section
2.01(e)(iv) hereof (the "Exchange Global Note"). Upon issuance, such Exchange
Global Note shall be registered in the name of the Depositary or its nominee,
duly executed by the Issuer and authenticated by the Trustee as hereinafter
provided and deposited on behalf of the beneficial owners of the Exchange Notes
represented thereby in accordance with the procedures of the Depositary.
If Initial Certificated Notes are tendered in a Registered Exchange Offer,
they will be exchanged for Certificated Notes in definitive, fully registered
form, without coupons and without legends, substantially in the form set forth
in Exhibit D hereto ("Exchange Certificated Notes"). Upon issuance, any such
Exchange Certificated Note shall be duly executed by the Issuer and
authenticated by the Trustee as hereinafter provided.
At the option of the Holder thereof, Exchange Notes may be held either in
the form of a beneficial interest in the Exchange Global Note or as Exchange
Certificated Notes.
(e) The following legends shall appear on each Global Note and each
Certificated Note as indicated below:
(i) Except as provided in Section 2.07(a) hereof, each Initial
Global Note and Initial Certificated Note shall bear the following legend (the
"Private Placement Legend") on the face thereof:
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED
OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH BELOW. BY ITS
ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
ACT) OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501
(a)(1), (2), (3) OR (7) UNDER THE ACT) (AN "ACCREDITED INVESTOR") OR
(C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN
OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS
AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY
THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL
BUYER IN COMPLIANCE WITH RULE 000X XXXXX XXX XXX, (X) XXXXXX XXX
XXXXXX XXXXXX TO AN ACCREDITED INVESTOR THAT IS ACQUIRING THIS NOTE
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN ACCREDITED
23
INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF $250,000,
FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE
IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT, THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON
ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER CAN
BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE THE UNITED STATES IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE ACT, (E)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT AND (3) AGREES THAT IT WILL
GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY
TRANSFER OF THIS NOTE WITHIN TWO YEARS AFTER ORIGINAL ISSUANCE OF
THIS NOTE, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE
HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE
ISSUER SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS
EITHER OF THEM MAY REASONABLY REQUIRE 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 ACT. AS USED HEREIN,
THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON"
HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE ACT.
(ii) Each Global Note shall bear the following legend on the face
thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO PHOENIX COLOR CORP. OR A SUCCESSOR
THEREOF OR THE REGISTRAR FOR REGISTRATION OF TRANSFER OR EXCHANGE
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS HAS BEEN REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.
24
(iii) The Initial Global Note shall bear the following legend on the
face thereof:
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
AND NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
INTERESTS IN THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.07 OF THE
INDENTURE, DATED AS OF FEBRUARY 2, 1999 AMONG PHOENIX COLOR CORP.,
AS ISSUER, THE GUARANTORS LISTED THEREIN, AND CHASE MANHATTAN TRUST
COMPANY, NATIONAL ASSOCIATION, AS TRUSTEE, PURSUANT TO WHICH THIS
NOTE WAS ISSUED.
(iv) The Exchange Global Note shall bear the following legend on the
face thereof:
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
AND NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE.
SECTION 2.02. Execution and Authentication. The Notes may be issued in two
series, a series of Initial Notes and a series of Exchange Notes. The aggregate
principal amount of Notes outstanding at any time shall not exceed $200,000,000
except as provided in Section 2.08 hereof. The Notes shall be executed on behalf
of the Issuer by its Chief Executive Officer, President, Chief Operating
Officer, Treasurer or any Vice President, and shall be attested by the Issuer's
Secretary or one of its Assistant Secretaries, in each case by manual or
facsimile signature.
The Notes shall be authenticated by manual signature of an authorized
signatory of the Trustee and shall not be valid for any purpose unless so
authenticated.
In case any officer of the Issuer whose signature shall have been placed
upon any of the Notes shall cease to be such officer of the Issuer before
authentication of such Notes by the Trustee and the issuance and delivery
thereof, such Notes may, nevertheless, be authenticated by the Trustee and
issued and delivered with the same force and effect as though such Person had
not ceased to be such an officer of the Issuer.
The Trustee shall, upon receipt of an Issuer Order requesting such action,
authenticate (a) Initial Notes for original issue up to the aggregate principal
amount not to exceed $200,000,000 outstanding at any given time, or (b) Exchange
Notes for issue pursuant to a Registered Exchange Offer for Initial Notes in a
principal amount equal to the principal amount of Initial Notes exchanged in
such Registered Exchange Offer. Such Issuer Order shall specify the amount of
Notes to be authenticated and the date on which, in the case of clause (a)
above, the Initial
25
Notes or, in the case of clause (b) above, the Exchange Notes, are to be
authenticated and shall further provide instructions concerning registration,
amounts for each Holder and delivery.
Upon the occurrence of any event specified in Section 2.07(c) hereof, the
Issuer shall execute and the Trustee shall authenticate and make available for
delivery to each beneficial owner identified by the Depositary, in exchange for
such beneficial owner's interest in the Initial Global Note or Exchange Global
Note, as the case may be, Initial Certificated Notes or Exchange Certificated
Notes, as the case may be, representing Notes theretofore represented by the
Initial Global Note or Exchange Global Note, as the case may be.
A Note shall not be valid or entitled to any benefits under this Indenture
or obligatory for any purpose unless executed by the Issuer and authenticated by
the manual signature of one of the authorized signatories of the Trustee as
provided herein. Such signature upon any Note shall be conclusive evidence, and
the only evidence, that such Note has been duly authenticated and delivered
under this Indenture and is entitled to the benefits of this Indenture.
The Trustee may appoint an authenticating agent reasonably acceptable to
the Issuer to authenticate the Notes. Unless limited by the terms of such
appointment, an authenticating agent may authenticate the Notes whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. Any authenticating agent of the
Trustee shall have the same rights hereunder as any Registrar or Paying Agent.
Notwithstanding the foregoing, if any Note shall have been authenticated
and delivered hereunder but never issued and sold by the Issuer, and the Issuer
shall deliver such Note to the Trustee for cancellation as provided in Section
2.11 together with a written statement (which need not be accompanied by an
Opinion of Counsel) stating that such Note has never been issued and sold by the
Issuer, for all purposes of this Indenture such Note shall be deemed never to
have been authenticated and delivered hereunder and shall not be entitled to the
benefits of this Indenture.
SECTION 2.03. Registrar and Paying Agent. The Issuer shall maintain,
pursuant to Section 4.02 hereof, an office or agency where the Notes may be
presented for registration of transfer or for exchange (the "Registrar"), an
office or agency where Notes may be presented for payment (the "Paying Agent")
and an office or agency where notices and demands to or upon the Issuer in
respect of the Notes and this Indenture may be served.
The Issuer shall cause to be kept at such office a register (the "Note
Register") in which, subject to such reasonable regulations as it may prescribe,
the Issuer shall provide for the registration of Notes and of transfers of Notes
entitled to be registered or transferred as provided herein. The Trustee, at its
Dallas, Texas office, is initially appointed Registrar for the purpose of
registering Notes and transfers of Notes as herein provided. The Issuer may,
upon written notice to the Trustee, change the designation of the Trustee as
Registrar and appoint another Person to act as Registrar for purposes of this
Indenture. If any Person other than the Trustee acts as Registrar, the Trustee
shall have the right at any time, upon reasonable notice, to inspect or examine
the Note Register and to make such inquiries of the Registrar as the Trustee
shall in its discretion deem necessary or desirable in performing its duties
hereunder.
26
The Issuer shall enter into an appropriate agency agreement with any
Person designated by the Issuer as Registrar or Paying Agent that is not a party
to this Indenture, which agreement shall incorporate the provisions of the TIA
and shall implement the provisions of this Indenture that relate to such
Registrar or Paying Agent. Prior to the designation of any such Person, the
Issuer shall, by written notice (which notice shall include the name and address
of such Person), inform the Trustee of such designation. The Trustee, at its
Dallas, Texas office, is initially appointed Paying Agent under this Indenture.
If the Issuer fails to maintain a Registrar or Paying Agent, the Trustee shall
act as such.
Subject to Section 2.07 hereof, upon surrender for registration of
transfer of any Note at an office or agency of the Issuer designated for such
purpose, the Issuer shall execute, and the Trustee shall authenticate and make
available for delivery, in the name of the designated transferee or transferees,
one or more new Initial Notes or Exchange Notes, as the case may be, of any
authorized denomination or denominations, of like tenor and aggregate principal
amount, all as requested by the transferor.
Every Note presented or surrendered for registration of transfer or for
exchange shall (if so required by the Issuer, the Trustee or the Registrar) be
duly endorsed, or be accompanied by a duly executed instrument of transfer in
form satisfactory to the Issuer, the Trustee and the Registrar, by the Holder
thereof or such Holder's attorney duly authorized in writing.
SECTION 2.04. Paying Agent To Hold Money in Trust. On or prior to each due
date of the principal, premium, if any, or any payment of interest or Liquidated
Damages, if any, with respect to any Note, the Issuer shall deposit with the
Paying Agent a sum sufficient to pay such principal, premium, if any, or
interest or Liquidated Damages, if any, when so becoming due.
The Issuer shall require each Paying Agent (other than the Trustee) to
agree in writing that such Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by such Paying Agent for the payment of
principal, premium, if any, or interest or Liquidated Damages, if any, with
respect to the Notes, shall notify the Trustee of any default by the Issuer in
making any such payment and at any time during the continuance of any such
default, upon the written request of the Trustee, shall forthwith pay to the
Trustee all sums held in trust by such Paying Agent.
The Issuer 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 such Paying Agent.
Upon complying with this Section 2.04, the Paying Agent shall have no further
liability for the money delivered to the Trustee.
SECTION 2.05 Holder 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 all Holders and shall otherwise comply with TIA Section 312(a).
If the Trustee is not the Registrar, the Issuer shall furnish to the Trustee at
least seven Business Days before each Interest Payment Date and at such other
times as the Trustee may request in writing, a list in such form and as of
27
such date as the Trustee may reasonably require of the names and addresses of
the Holders of Notes and the Issuer shall otherwise comply with TIA Section
312(a).
SECTION 2.06. Global Notes. (a) So long as a Global Note is registered in
the name of the Depositary or its nominee, members of, or participants in, the
Depositary ("Agent Members") shall have no rights under this Indenture with
respect to the Global Note held on their behalf by the Depositary or the Trustee
as its custodian, and the Depositary may be treated by the Issuer, the
Guarantors, the Trustee and any agent of the Issuer, the Guarantors or the
Trustee as the absolute owner of such Global Note for all purposes.
Notwithstanding the foregoing, nothing herein shall (i) prevent the Issuer, the
Guarantors, the Trustee or any agent of the Issuer, the Guarantors or the
Trustee, from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or (ii) impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a Holder.
(b) The Holder of a Global Note may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests in such
Global Note through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
(c) Whenever, as a result of an optional redemption of Notes by the
Issuer, a Change of Control Offer, an Asset Sale Offer, a Registered Exchange
Offer or an exchange for Certificated Notes pursuant to the provisions of
Section 2.07(b) or Section 2.07(c) hereof, a Global Note is redeemed,
repurchased or exchanged in part, such Global Note shall be surrendered by the
Holder thereof to the Trustee who shall cause an adjustment to be made to
Schedule A thereof so that the principal amount of such Global Note will be
equal to the portion of such Global Note not redeemed, repurchased or exchanged
and shall thereafter return such Global Note to such Holder, provided that each
such Global Note shall be in a principal amount of $1,000 or an integral
multiple thereof.
SECTION 2.07. Transfer and Exchange. (a) By its acceptance of any Initial
Note represented by a certificate bearing the Private Placement Legend, each
Holder of, and beneficial owner of an interest in, such Initial Note
acknowledges the restrictions on transfer of such Initial Note set forth in the
Private Placement Legend and agrees that it will transfer such Initial Note only
in accordance with the Private Placement Legend. Upon the registration of
transfer, exchange or replacement of an Initial Note not bearing the Private
Placement Legend, the Trustee shall deliver an Initial Note or Initial Notes
that do not bear the Private Placement Legend. Upon the transfer, exchange or
replacement of an Initial Note bearing the Private Placement Legend, the Trustee
shall deliver an Initial Note or Initial Notes bearing the Private Placement
Legend, unless such legend may be removed from such Note as provided in this
Section 2.07(a). If the Private Placement Legend has been removed from an
Initial Note, as provided herein, no other Initial Note issued in exchange for
all or any part of such Initial Note shall bear such legend, unless the Issuer
has reasonable cause to believe that such other Initial Note represents a
"restricted security" within the meaning of Rule 144 and instructs the Trustee
in writing to cause a legend to appear thereon. Each Initial Note shall bear the
Private Placement Legend unless and until:
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(i) a transfer of such Initial Note is made pursuant to an effective Shelf
Registration Statement, in which case the Private Placement Legend shall
be removed from such Initial Note so transferred at the request of the
Holder; or
(ii) there is delivered to the Issuer such satisfactory evidence, which
may include an opinion of independent counsel licensed to practice law in
the State of New York, as may reasonably be requested by the Issuer
confirming that neither such legend nor the restrictions on transfer set
forth therein are required to ensure that transfers of such Initial Note
will not violate the registration and prospectus delivery requirements of
the Securities Act; provided that the Trustee shall not be required to
determine (but may rely on a determination made by the Issuer with respect
to) the sufficiency of any such evidence; and upon provision of such
evidence, the Trustee shall authenticate and deliver in exchange for such
Initial Note, an Initial Note or Initial Notes (representing the same
aggregate principal amount of the Initial Note being exchanged) without
such legend.
(b) Special Transfer Provisions. The following provisions of this
paragraph (b) are applicable only to Initial Notes bearing the Private Placement
Legend:
(i) Transfers to QIBs. If the Holder of an Initial Certificated Note
wishes to transfer such Initial Certificated Note to a QIB pursuant to
Rule 144A, such Holder may, subject to the rules and procedures of the
Depositary, cause the exchange of such Initial Certificated Note for an
equivalent beneficial interest in the Initial Global Note. Upon receipt by
the Trustee, as Registrar, at its designated office of (A) such Initial
Certificated Note, duly endorsed as provided herein, (B) written
instructions from such Holder directing the Trustee, as Registrar, to
credit or cause to be credited a beneficial interest in the Initial Global
Note equal to the principal amount of the Initial Certificated Note to be
exchanged, such instructions to contain information regarding the
participant account with the Depositary to be credited with such increase
and (C) a certificate in the form of Exhibit E attached hereto from the
transferor, then the Trustee, as Registrar, shall cancel or cause to be
canceled such Initial Certificated Note and shall instruct the Depositary
to increase or cause to be increased such Initial Global Note by the
aggregate principal amount of the beneficial interest in the Initial
Certificated Note to be exchanged and to credit or cause to be credited to
the account of the Person specified in such instructions a beneficial
interest in the Initial Global Note equal to the principal amount of the
Initial Certificated Note so canceled;
(ii) Transfers to Institutional Accredited Investors and Exchange of
Interests in Global Notes:
(A) If a Holder of a beneficial interest in the Initial Global Note
deposited with the Depositary or the Trustee as custodian for the
Depositary wishes at any time to transfer its interest in such Initial
Global Note to an Institutional Accredited Investor or to exchange such
interest for an Initial Certificated Note evidencing such interest, such
Holder may, subject to the rules and procedures of the Depositary, cause
the transfer or exchange of such interest for one or more Initial
Certificated Notes of any authorized denomination or denominations and of
the same aggregate principal amount. Upon
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receipt by the Trustee, as Registrar, at its designated office of (I)
written instructions from the Depositary directing the Trustee, as
Registrar, to authenticate and deliver one or more Initial Certificated
Notes of the same aggregate principal amount as the beneficial interest in
the Initial Global Note to be transferred or exchanged, such instructions
to contain the name or names of the designated transferee or transferees,
if any, the authorized denomination or denominations of the Initial
Certificated Notes to be so issued and appropriate delivery instructions
and (II) in the case of a transfer, (x) a certificate in the form of
Exhibit F attached hereto from the transferor, (y) a certificate in the
form of Exhibit G attached hereto from the transferee and (z) such other
certifications, legal opinions or other information as the Issuer or the
Trustee may reasonably require 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, then the Trustee, as
Registrar, will instruct the Depositary to reduce or cause to be reduced
such Initial Global Note by the aggregate principal amount of the
beneficial interest therein to be exchanged or transferred and to debit or
cause to be debited from the account of the Person making such exchange or
transfer the beneficial interest in the Initial Global Note that is being
exchanged or transferred, and concurrently with such reduction and debit
the Issuer shall execute, and the Trustee shall authenticate and deliver,
one or more Initial Certificated Notes of the same aggregate principal
amount in accordance with the instructions referred to above; and
(B) if a Holder of an Initial Certificated Note wishes to transfer
such Note to an Institutional Accredited Investor, such Holder may,
subject to the restrictions on transfer set forth herein and in such
Initial Certificated Note, cause the exchange of such Initial Certificated
Note for one or more Initial Certificated Notes of any authorized
denomination or denominations and of the same aggregate principal amount.
Upon receipt by the Trustee, as Registrar, at its designated office of (I)
such Initial Certificated Note, duly endorsed as provided herein, (II)
written instructions from such Holder directing the Trustee, as Registrar,
to authenticate and deliver one or more Initial Certificated Notes of the
same aggregate principal amount as the Initial Certificated Notes to be
exchanged, such instructions to contain the name or names of the
designated transferee or transferees, the authorized denomination or
denominations of the Initial Certificated Notes to be so issued and
appropriate delivery instructions, (III) a certificate in the form of
Exhibit F attached hereto from the transferor, (IV) a certificate in the
form of Exhibit G attached hereto from the transferee and (V) such other
certifications, legal opinions or other information as the Issuer or the
Trustee may reasonably require 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, then the Trustee, as
Registrar, shall cancel or cause to be canceled such Initial Certificated
Note and concurrently therewith, the Issuer shall execute, and the Trustee
shall authenticate and deliver, one or more Initial Certificated Notes of
the same aggregate principal amount, in accordance with the instructions
referred to above;
(iii) Transfers to Non-U.S. Persons:
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(A) If a Holder of a beneficial interest in the Initial Global Note
deposited with the Depositary or the Trustee as custodian for the
Depositary wishes at any time to transfer its interest in such Initial
Global Note to a Non-U. S. Person pursuant to Regulation S who wishes to
take delivery thereof in the form of a Certificated Note, such Holder may,
subject to the rules and procedures of the Depositary, cause the exchange
of such interest for one or more Initial Certificated Notes of any
authorized denomination or denominations and of the same aggregate
principal amount. Upon receipt by the Trustee, as Registrar, at its
designated office of (I) written instructions from the Depositary
directing the Trustee, as Registrar, to authenticate and deliver one or
more Initial Certificated Notes of the same aggregate principal amount as
the beneficial interest in the Initial Global Note to be exchanged, such
instructions to contain the name or names of the designated transferee or
transferees, the authorized denomination or denominations of the Initial
Certificated Notes to be so issued and appropriate delivery instructions,
(II) a certificate in the form of Exhibit H attached hereto from the
transferor and (III) a certificate in the form of Exhibit I attached
hereto from the transferee, then the Trustee, as Registrar, will instruct
the Depositary to reduce or cause to be reduced such Initial Global Note
by the aggregate principal amount of the beneficial interest therein to be
exchanged and to debit or cause to be debited from the account of the
Person making such transfer the beneficial interest in the Initial Global
Note that is being transferred, and concurrently with such reduction and
debit the Issuer shall execute, and the Trustee shall authenticate and
deliver, one or more Initial Certificated Notes of the same aggregate
principal amount in accordance with the instructions referred to above;
and
(B) if a Holder of an Initial Certificated Note wishes to transfer
such Note to a Non-U. S. Person pursuant to Regulation S who wishes to
take delivery thereof in the form of a Certificated Note, such Holder may,
subject to the restrictions on transfer set forth herein and in such
Initial Certificated Note, cause the exchange of such Initial Certificated
Note for one or more Initial Certificated Notes of any authorized
denomination or denominations and of the same aggregate principal amount.
Upon receipt by the Trustee, as Registrar, at its designated office of (I)
such Initial Certificated Note, duly endorsed as provided herein, (II)
written instructions from such Holder directing the Trustee, as Registrar,
to authenticate and deliver one or more Initial Certificated Notes of the
same aggregate principal amount as the Initial Certificated Notes to be
exchanged, such instructions to contain the name or names of the
designated transferee or transferees, the authorized denomination or
denominations of the Initial Certificated Notes to be so issued and
appropriate delivery instructions, (III) a certificate in the form of
Exhibit H attached hereto from the transferor and (IV) a certificate in
the form of Exhibit I attached hereto from the transferee, then the
Trustee, as Registrar, shall cancel or cause to be canceled such Initial
Certificated Note and concurrently therewith, the Issuer shall execute,
and the Trustee shall authenticate and deliver, one or more Initial
Certificated Notes of the same aggregate principal amount, in accordance
with the instructions referred to above;
(iv) Transfers Pursuant to Other Exemptions.
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(A) If a Holder of a beneficial interest in the Initial Global Note
deposited with the Depositary or the Trustee as custodian for the
Depositary wishes at any time to transfer its interest in such Initial
Global Note pursuant to another applicable exemption from the registration
requirements of the Securities Act, such Holder may, subject to the rules
and procedures of the Depositary, cause the exchange of such interest for
one or more Initial Certificated Notes of any authorized denomination or
denominations and of the same aggregate principal amount. Upon receipt by
the Trustee, as Registrar, at its designated office of (I) written
instructions from the Depositary directing the Trustee, as Registrar, to
authenticate and deliver one or more Initial Certificated Notes of the
same aggregate principal amount as the beneficial interest in the Initial
Global Note to be exchanged, such instructions to contain the name or
names of the designated transferee or transferees, the authorized
denomination or denominations of the Initial Certificated Notes to be so
issued and appropriate delivery instructions and (II) such certifications,
legal opinions or other information as the Issuer or the Trustee may
reasonably require 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, then the Trustee, as Registrar, will
instruct the Depositary to reduce or cause to be reduced such Initial
Global Note by the aggregate principal amount of the beneficial interest
therein to be exchanged and to debit or cause to be debited from the
account of the Person making such transfer the beneficial interest in the
Initial Global Note that is being transferred, and concurrently with such
reduction and debit the Issuer shall execute, and the Trustee shall
authenticate and deliver, one or more Initial Certificated Notes of the
same aggregate principal amount in accordance with the instructions
referred to above; and
(B) if a Holder of an Initial Certificated Note wishes to transfer
such Initial Certificated Note pursuant to another applicable exemption
from the registration requirements of the Securities Act, such Holder may,
subject to the restrictions on transfer set forth herein and in such
Initial Certificated Note, cause the exchange of such Initial Certificated
Note for one or more Initial Certificated Notes of any authorized
denomination or denominations and of the same aggregate principal amount.
Upon receipt by the Trustee, as Registrar, at its designated office of (I)
such Initial Certificated Note, duly endorsed as provided herein, (II)
written instructions from such Holder directing the Trustee, as Registrar,
to authenticate and deliver one or more Initial Certificated Notes of the
same aggregate principal amount as the Initial Certificated Notes to be
exchanged, such instructions to contain the name or names of the
designated transferee or transferees, the authorized denomination or
denominations of the Initial Certificated Notes to be so issued and
appropriate delivery instructions and (III) such certifications, legal
opinions or other information as the Issuer or the Trustee may reasonably
require 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, then the Trustee, as Registrar, shall
cancel or cause to be canceled such Initial Certificated Note and
concurrently therewith, the Issuer shall execute, and the Trustee shall
authenticate and deliver, one or more Initial Certificated Notes of the
same aggregate principal amount, in accordance with the instructions
referred to above.
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The Issuer shall deliver to the Trustee, and the Trustee shall retain for
two (2) years, copies of all documents received pursuant to this Section
2.07(b). The Issuer shall have the right to inspect and make copies of all such
documents at its sole expense at any reasonable time upon the giving of
reasonable written notice to the Trustee.
(c) The Initial Global Note or Exchange Global Note, as the case may be,
shall be exchanged by the Issuer for one or more Initial Certificated Notes or
Exchange Certificated Notes, as the case may be, if (i) the Depositary has
notified the Issuer that it is unwilling or unable to continue as, or ceases to
be, a clearing agency registered under Section 17A of the Exchange Act and a
successor to the Depositary registered as a clearing agency under Section 17A of
the Exchange Act is not able to be appointed by the Issuer within ninety (90)
calendar days, or (ii) the Depositary is at any time unwilling or unable to
continue as Depositary and a successor to the Depositary is not able to be
appointed by the Issuer within ninety (90) calendar days, or (iii) the Issuer,
at its option, notifies the Trustee in writing that it elects to cause the
issuance of Notes in the form of Certificated Notes. If an Event of Default
occurs and is continuing, the Issuer shall, at the request of the Holder
thereof, exchange all or part of the Initial Global Note or Exchange Global
Note, as the case may be, for one or more Initial Certificated Notes or Exchange
Certificated Notes, as the case may be; provided that the principal amount of
each of such Initial Certificated Note or Exchange Certificated Note, as the
case may be, and such Global Note, after such exchange, shall be $1,000 or an
integral multiple thereof. Whenever a Global Note is exchanged as a whole for
one or more Initial Certificated Notes or Exchange Certificated Notes, as the
case may be, it shall be surrendered by the Holder thereof to the Trustee for
cancellation. Whenever a Global Note is exchanged in part for one or more
Initial Certificated Notes or Exchange Certificated Notes, as the case may be,
it shall be surrendered by the Holder thereof to the Trustee and the Trustee
shall make the appropriate notations thereon pursuant to Section 2.06(c) hereof.
All Initial Certificated Notes or Exchange Certificated Notes, as the case may
be, issued in exchange for a Global Note or any portion thereof shall be
registered in such names, and delivered, as the Depositary shall instruct the
Trustee in writing. Any Initial Certificated Notes issued pursuant to this
Section 2.07(c) shall include the Private Placement Legend, except as set forth
in Section 2.07(a) hereof.
(d) Any Initial Notes that are presented to the Registrar for exchange
pursuant to a Registered Exchange Offer shall be exchanged for Exchange Notes of
equal principal amount upon surrender to the Registrar of the Initial Notes to
be exchanged in accordance with the terms of the Registered Exchange Offer;
provided that the Initial Notes so surrendered for exchange are accompanied by a
letter of transmittal and duly endorsed or accompanied by a written instrument
of transfer in form satisfactory to the Issuer, the Trustee and the Registrar
and duly executed by the Holder thereof or such Holder's attorney who shall be
duly authorized in writing to execute such document on behalf of such Holder.
Whenever any Initial Notes are so surrendered for exchange, the Issuer shall
execute, and the Trustee shall authenticate and deliver to the surrendering
Holder thereof, Exchange Notes in the same aggregate principal amount as the
Initial Notes so surrendered.
(e) A Holder may transfer a Note only upon the surrender of such Note for
registration of transfer. No such transfer shall be effected until, and the
transferee shall succeed to the rights of a Holder only upon, final acceptance
and registration of the transfer in the Note
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Register by the Registrar. When Notes are presented to the Registrar with a
request to register the transfer of, or to exchange, such Notes, the Registrar
shall register the transfer or make such exchange as requested if its
requirements for such transactions and any applicable requirements hereunder are
satisfied. To permit registrations of transfers and exchanges, the Issuer shall
execute and the Trustee shall authenticate and deliver Certificated Notes at the
Registrar's request.
(f) The Issuer shall not be required to make and the Registrar need not
register the transfer or exchange of Certificated Notes or portions thereof
selected for redemption (except, in the case of a Certificated Note to be
redeemed in part, the portion of such Note not to be redeemed) or any
Certificated Notes for a period of fifteen (15) calendar days before a selection
of Notes to be redeemed.
(g) No service charge shall be made for any registration of transfer or
exchange of Notes, but the Issuer may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer of Notes (other than in respect of a
Registered Exchange Offer, except as provided in the Registration Rights
Agreement).
(h) All Notes issued upon any registration of 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 Notes surrendered for
such registration of transfer or exchange.
(i) Any Holder of a Global Note shall, by acceptance of such Global Note,
agree that transfers of beneficial interests in such Global Note may be effected
only through a book entry system maintained by the Depository (or its agent),
and that ownership of a beneficial interest in the Notes represented thereby
shall be required to be reflected in book-entry form. Transfers of a Global Note
shall be limited to transfers in whole and not in part, to the Depositary, its
successors, and their respective nominees. Interests of beneficial owners in a
Global Note shall be transferred in accordance with the rules and procedures of
the Depositary (or its successors), which shall, in the case of the Initial
Global Note, include restrictions designed to ensure that the beneficial owners
of such Initial Global Note are QIBs.
SECTION 2.08. Replacement Notes. If a mutilated Note is surrendered to the
Registrar or if the Holder of a Note claims that the Note has been lost,
destroyed or wrongfully taken, the Issuer shall issue and the Trustee shall
authenticate a replacement Note 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. If required by the Trustee or the Issuer, such
Holder shall furnish an indemnity bond sufficient in the judgment of the Issuer
and the Trustee to protect the Issuer, the Trustee, the Paying Agent, the
Registrar and any co-registrar from any loss or liability which any of them may
suffer if a Note is replaced. The Issuer and the Trustee may charge the Holder
for their expenses in replacing a Note.
Every replacement Note is an additional obligation of the Issuer.
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SECTION 2.09. Outstanding Notes. Notes outstanding at any time are all
Notes 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. A Note does not cease to be outstanding because the Issuer or an
Affiliate of the Issuer holds the Note.
If a Note is replaced pursuant to Section 2.08, it ceases to be
outstanding unless the Trustee and the Issuer receive proof satisfactory to them
that the replaced Note 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 money sufficient to pay all
principal, premium, if any, and interest and Liquidated Damages, if any, payable
on that date with respect to the Notes (or portions thereof) to be redeemed or
maturing, as the case may be, and the Paying Agent is not prohibited from paying
such money to the Noteholders on that date pursuant to the terms of this
Indenture, then on and after that date such Notes (or portions thereof) cease to
be outstanding and interest on them ceases to accrue.
SECTION 2.10. Temporary Notes. Until definitive Notes are ready for
delivery the Issuer may prepare and the Trustee shall authenticate and deliver
temporary Notes. Temporary Notes shall be substantially in the form of
definitive Notes but may have variations that the Issuer considers appropriate
for temporary Notes. Without unreasonable delay, the Issuer shall prepare and
the Trustee shall authenticate definitive Notes and deliver them in exchange for
temporary Notes.
SECTION 2.11. Cancellation. The Issuer at any time may deliver Notes to
the Trustee for cancellation. The Registrar and the Paying Agent shall forward
to the Trustee any Notes surrendered to them for registration of transfer,
exchange or payment. The Trustee and no one else shall cancel and destroy
(subject to the record retention requirements of the Exchange Act) all Notes
surrendered for registration of transfer, exchange, payment or cancellation and
deliver a certificate of such destruction to the Issuer unless the Issuer
directs the Trustee to deliver canceled Notes to the Issuer; provided, that the
Trustee shall not be required to destroy any Notes. The Issuer may not issue new
Notes to replace Notes it has redeemed, paid or delivered to the Trustee for
cancellation.
SECTION 2.12. Payment of Interest, Interest Rights Preserved. Interest on
any Note which is payable, and is paid or duly provided for, on any Interest
Payment Date shall be paid to the Person in whose name such Note is registered
at the close of business on the Record Date for such interest payment, which
shall be the January 15 or July 15 (whether or not a Business Day) immediately
preceding such Interest Payment Date.
Any interest on any Note which is payable, but is not paid or duly
provided for, on any Interest Payment Date (herein called "Defaulted Interest")
shall forthwith cease to be payable to the registered Holder on the relevant
Record Date, and, except as hereinafter provided, such Defaulted Interest, and
any interest payable on such Defaulted Interest, may be paid by the Issuer, at
its election, as provided in clause (a) or (b) below:
35
(a) The Issuer may elect to make payment of any Defaulted Interest, and
any interest payable on such Defaulted Interest, to the Persons in whose names
the Notes are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the following
manner. The Issuer shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on the Notes and the date of the proposed
payment, and at the same time the Issuer shall deposit with the Trustee an
amount of money equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as provided in this Section 2.12(a). Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest which
shall be not more than fifteen (15) calendar days and not less than ten (10)
calendar days prior to the date of the proposed payment and not less than ten
(10) calendar days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Issuer of such Special
Record Date and, in the name and at the expense of the Issuer, shall cause
notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor to be sent, first-class mail, postage prepaid, to each Holder at
such Holder's address as it appears in the Note Register, not less than ten (10)
calendar days prior to such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in
whose names the Notes are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following clause (b);
or
(b) The Issuer may make payment of any Defaulted Interest, and any
interest payable on such Defaulted Interest, on the Notes in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Notes may be listed, and upon such notice as may be required by such
exchange, if, after notice given by the Issuer to the Trustee of the proposed
payment pursuant to this clause (b), such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 2.12, each Note
delivered under this Indenture upon registration of transfer of, or in exchange
for, or in lieu of, any other Note, shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Note.
SECTION 2.13. CUSIP Numbers. The Issuer in issuing the Notes 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 Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers.
SECTION 2.14. Transfers, etc. Each Holder of a Note agrees to indemnify
the Issuer and the Trustee against any liability that may result from the
transfer, exchange or assignment by
36
such Holder of such Holder's Note in violation of any provision of this
Indenture and/or applicable U.S. Federal or state securities law.
ARTICLE 3
REDEMPTION
SECTION 3.01. Notices to Trustee. If the Issuer elects to redeem Notes
pursuant to paragraph 8 of the Initial Notes or paragraph 7 of the Exchange
Notes, it shall notify the Trustee in writing of the Redemption Date and the
principal amount of Notes to be redeemed.
The Issuer shall give each notice to the Trustee provided for in this
Section 3.01 not less than thirty (30) days nor more than sixty (60) days before
the Redemption Date unless the Trustee consents to a shorter period. Such notice
shall be accompanied by an Officers' Certificate and an Opinion of Counsel from
the Issuer to the effect that such redemption will comply with the conditions
herein.
SECTION 3.02. Selection of Notes To Be Redeemed. If fewer than all the
Notes are to be redeemed, the Trustee shall select the Notes to be redeemed pro
rata or by lot or by a method that complies with applicable legal and securities
exchange requirements, if any, and that the Trustee considers 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 Notes not previously called for redemption. The
Trustee may select for redemption portions of the principal of Notes that have
denominations larger than $1,000. Notes and portions of them the Trustee selects
shall be in amounts of $1,000 or a whole multiple of $1,000. Provisions of this
Indenture that apply to Notes called for redemption also apply to portions of
Notes called for redemption. The Trustee shall notify the Issuer promptly of the
Notes or portions of Notes to be redeemed.
SECTION 3.03. Notice of Redemption. At least twenty (20) days but not more
than sixty (60) days before a Redemption Date, the Issuer shall mail a notice of
redemption by first-class mail, postage prepaid, to each Holder of Notes to be
redeemed.
The notice shall identify the Notes to be redeemed and shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) the name and address of the Paying Agent;
(d) that Notes called for redemption must be surrendered to the Paying
Agent to collect the Redemption Price;
(e) if any Global Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date, the Global Note, with a
37
notation on Schedule A thereof adjusting the principal amount thereof to be
equal to the unredeemed portion, will be returned to the Holder thereof,
(f) if any Certificated Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the Redemption
Date, a new Certificated Note or Certificated Notes in principal amount equal to
the unredeemed portion will be issued;
(g) if fewer than all the outstanding Notes are to be redeemed, the
identification and principal amounts of the particular Notes to be redeemed;
(h) that, unless the Issuer defaults in making such redemption payment or
the Paying Agent is prohibited from making such payment pursuant to the terms of
this Indenture, interest on Notes (or portion thereof) called for redemption
ceases to accrue on and after the Redemption Date; and
(i) 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 Notes.
At the Issuer's request, the Trustee shall give the notice of redemption
in the Issuer's name and at the Issuer's expense. In such event, the Issuer
shall provide the Trustee with the information required by this Section 3.03.
SECTION 3.04. Effect of Notice of Redemption. Once notice of redemption is
mailed, Notes 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 Notes shall be paid at the Redemption Price stated in the
notice, plus accrued interest to the Redemption Date. 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.
SECTION 3.05. Deposit of Redemption Price. On or prior to the Redemption
Date, the Issuer shall deposit with the Paying Agent (or, if the Issuer or a
domestically incorporated wholly-owned Subsidiary is the Paying Agent, shall
segregate and hold in trust) money in immediately available funds, sufficient to
pay the Redemption Price of and accrued interest on all Notes to be redeemed on
that date other than Notes or portions of Notes called for redemption which have
been delivered by the Issuer to the Trustee for cancellation.
So long as the Issuer complies with the preceding paragraph and the other
provisions of this Article 3, interest on the Notes or portions thereof to be
redeemed on the applicable Redemption Date shall cease to accrue from and after
such date and such Notes or portions thereof shall be deemed not to be entitled
to any benefit under this Indenture except to receive payment of the Redemption
Price on the Redemption Date (subject to the right of each Holder of record on
the relevant Record Date to receive interest due on the relevant Interest
Payment Date). If any Note called for redemption shall not be so paid upon
surrender for redemption, then, from the Redemption Date until such Redemption
Price is paid, interest shall be paid on the unpaid principal and premium and,
to the extent permitted by law, on any accrued but unpaid interest thereon, in
each case at the rate prescribed therefor by such Notes.
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SECTION 3.06. Notes Redeemed in Part. Upon surrender of a Note that is
redeemed in part, the Issuer shall execute and the Trustee shall authenticate
for the Holder of the Note being surrendered (at the Issuer's expense) a new
Note equal in principal amount to the unredeemed portion of the Note
surrendered.
ARTICLE 4
COVENANTS
SECTION 4.01. Payment of Notes. The Issuer shall promptly pay the
principal of, premium, if any, and interest and Liquidated Damages, if any, on
the Notes on the dates and in the manner provided in the Notes and in this
Indenture. Principal, premium, if any, and interest and Liquidated Damages, if
any, 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, premium, if any, and interest and Liquidated Damages, if any, then
due and the Trustee or the Paying Agent, as the case may be, is not prohibited
from paying such money to the Noteholders on that date pursuant to the terms of
this Indenture.
To the extent lawful, the Issuer shall pay interest on overdue principal,
overdue premium, Defaulted Interest and Liquidated Damages (without regard to
any applicable grace period) at the interest rate borne on the Notes. The
Issuer's obligation pursuant to the previous sentence shall apply whether such
overdue amount is due at its maturity, as a result of the Issuer's obligations
pursuant to Sections 3.05, Section 4.11 or Section 4.14 hereof, or otherwise.
All payments with respect to a Global Note or a Certificated Note
(including principal, premium, if any, interest and Liquidated Damages, if any)
the Holders of which have given wire transfer instructions to the Issuer will be
required to be made by wire transfer of immediately available funds to the
account or (in the case of a Global Note) accounts specified by the Holders
thereof or, if no such account is specified, by sending via first-class mail,
postage prepaid, a check to each such Holders' registered address.
SECTION 4.02. Maintenance of Office or Agency. The Issuer shall maintain
an office or agency where Notes may be presented or surrendered for payment and
where Notes may be surrendered for registration of transfer or exchange. The
Issuer shall maintain an office where notices and demands to or upon the Issuer
in respect of the Notes and this Indenture may be served, which office shall be
initially the Corporate Trust Office designated in the proviso of the definition
of "Corporate Trust Office." The Issuer shall 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 Issuer shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Issuer hereby appoints the
Trustee its agent to receive all presentations, surrenders, notices and demands.
The Issuer may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all of
such purposes, and may from
39
time to time rescind such designations; provided that no such designation or
rescission shall in any manner relieve the Issuer of its obligation to maintain
an office or agency for such purposes. The Issuer shall give prompt written
notice to the Trustee of any such designation and any change in the location of
any such other office or agency.
The Issuer hereby designates the Dallas, Texas office of the Trustee as
one such office or agency of the Issuer in accordance with Section 2.03 hereof.
SECTION 4.03. Money for the Notes to be Held in Trust. If the Issuer, any
Subsidiary of the Issuer or any of their respective Affiliates shall at any time
act as Paying Agent with respect to the Notes, such Paying Agent shall, on or
before each due date of the principal of, premium, if any, or interest or
Liquidated Damages, if any, on any of the Notes, segregate and hold in trust for
the benefit of the Persons entitled thereto money sufficient to pay the
principal, premium, if any, or interest or Liquidated Damages, if any, so
becoming due until such money shall be paid to such Persons or otherwise
disposed of as herein provided, and shall promptly notify the Trustee of its
action or failure so to act.
Whenever the Issuer shall have one or more Paying Agents with respect to
the Notes, it shall, prior to 10:00 a.m. New York City time on each due date of
the principal of, premium, if any, or interest or Liquidated Damages, if any, on
any of the Notes, deposit with a Paying Agent a sum sufficient to pay the
principal, premium, if any, or interest or Liquidated Damages, if any, so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium or interest or Liquidated Damages, if any,
and (unless such Paying Agent is the Trustee) the Paying Agent shall promptly
notify the Trustee of the Issuer's action or failure so to act.
SECTION 4.04. Corporate Existence. Subject to the provisions of Article 5
hereof, the Issuer shall do or cause to be done all things necessary to preserve
and keep in full force and effect the corporate existence, rights (charter and
statutory) and franchises of the Issuer and each of its Restricted Subsidiaries;
provided that the Issuer and any such Restricted Subsidiary shall not be
required to preserve the corporate existence of any such Restricted Subsidiary
or any such right or franchise if the Board of Directors shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Issuer and that the loss thereof is not disadvantageous in any material
respect to the Holders.
SECTION 4.05. Maintenance of Property. The Issuer shall cause all Property
used in the conduct of its business or the business of any of its Restricted
Subsidiaries to be maintained and kept in good condition, repair and working
order and supplied with all necessary equipment and shall cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as, in the judgment of the Issuer, may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times; provided, that nothing in this Section 4.05 shall prevent the
Issuer from discontinuing the operation or maintenance of any of such Property
if such discontinuance is, in the judgment of the Issuer, desirable in the
conduct of its business or the business of any of its Subsidiaries and not
disadvantageous in any material respect to the Holders.
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SECTION 4.06. Payment of Taxes and Other Claims. The Issuer and its
Subsidiaries shall pay or discharge or cause to be paid or discharged, before
the same shall become delinquent (a) all material obligations and liabilities,
(b) all taxes, assessments and governmental charges levied or imposed upon the
Issuer or any of its Subsidiaries or upon the income, profits or Property of the
Issuer or any of its Subsidiaries and (c) all material lawful claims for labor,
materials and supplies which, if unpaid, might by law become a Lien upon the
Property of the Issuer or any of its Subsidiaries; provided, that the Issuer
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP or other appropriate provision has been made.
SECTION 4.07. SEC Reports. Notwithstanding that the Issuer may not be
required to remain subject to the reporting requirements of Section 13 or 15(d)
of the Exchange Act, the Issuer shall (a) provide the Trustee, the Initial
Purchaser and Noteholders with such annual reports, 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 (b) beginning on
the earlier of (i) the date the registration statement filed with the SEC
relating to the Exchange Notes is declared effective and (ii) 130 days after the
Issue Date, file with the Commission, to the extent permitted, the annual
reports, information, documents and reports described in clause (a), in each
case, such information, documents and other reports to be so provided and filed
at the times specified for the filing of such information, documents and reports
under such Sections. In addition, the Issuer will make available, upon request,
to any Holder and any prospective purchaser of Notes the information required
pursuant to Rule 144A(d)(4) under the Securities Act during any period in which
the Issuer is not subject to Section 13 or 15(d) of the Exchange Act. The Issuer
also shall comply with the other provisions of TIA Section 314(a). Delivery of
such reports, information and documents to the Trustee is for informational
purposes only and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein, including the Issuer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
SECTION 4.08. Limitation on Indebtedness. The Issuer shall not, and shall
not permit any Restricted Subsidiary to, incur, directly or indirectly, any
Indebtedness (including any Acquired Indebtedness) other than Permitted
Indebtedness. Notwithstanding the foregoing, in addition to Permitted
Indebtedness, the Issuer or any Restricted Subsidiary may incur Indebtedness
(including Acquired Indebtedness) if (i) no Default or Event of Default shall
have occurred and be continuing on the date of the proposed incurrence thereof
or would result as a consequence of such proposed incurrence and (ii)
immediately after giving effect to such proposed incurrence, the Consolidated
Coverage Ratio of the Issuer is at least 2.0 to 1.0 for incurrences on or before
February 1, 2001 and 2.25 to 1.0 for all incurrences thereafter.
SECTION 4.09. Limitation on Restricted Payments.
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(a) The Issuer shall not, and shall not permit any Restricted Subsidiary,
directly or indirectly, to make a Restricted Payment if at the time the Issuer
or such Restricted Subsidiary makes such Restricted Payment:
(i) a Default or Event of Default shall have occurred and be
continuing (or would result therefrom); or
(ii) the Issuer or such Restricted Subsidiary is not able to incur,
after giving effect to such Restricted Payment, an additional $1.00 of
Indebtedness pursuant to the second sentence of Section 4.08; or
(iii) the aggregate amount of such Restricted Payment and any other
Restricted Payments since the Issue Date would exceed the sum of
(A) fifty percent (50%) of the Consolidated Net Income accrued
on a cumulative basis during the period (treated as one accounting
period) beginning on the first day of the fiscal quarter beginning
immediately following the Issue Date to the end of the most recent
fiscal quarter ending at least forty-five (45) days prior to the
date of such Restricted Payment (or, in case such Consolidated Net
Income shall be a deficit, minus 100% of such deficit);
(B) the aggregate Net Cash Proceeds received by the Issuer
from the issuance or sale of, or as a capital contribution in
respect of, its Capital Stock (other than Disqualified Stock)
subsequent to the Issue Date (other than an issuance or sale to a
Subsidiary of the Issuer and other than an issuance or sale to an
employee stock ownership plan or to a trust established by the
Issuer or any of its Subsidiaries for the benefit of their
employees);
(C) the amount by which Indebtedness of the Issuer is reduced
on the Issuer's balance sheet upon the conversion or exchange (other
than by a Subsidiary of the Issuer) subsequent to the Issue Date of
any Indebtedness of the Issuer convertible or exchangeable for
Capital Stock (other than Disqualified Stock) of the Issuer (less
the amount of any cash, or the fair value of any other property,
distributed by the Issuer upon such conversion or exchange); and
(D) an amount equal to the sum of (i) the net reduction in
Investment in any Person resulting from dividends, repayments of
loans or advances or other transfers of assets, in each case to the
Issuer or any Restricted Subsidiary from such Person, and (ii) the
portion (proportionate to the Issuer's equity interest in such
Subsidiary) of the fair market value of the net assets of an
Unrestricted Subsidiary at the time such Unrestricted Subsidiary is
designated a Restricted Subsidiary; provided, that the foregoing sum
shall not exceed, in the case of any Unrestricted Subsidiary, the
amount of Investments previously made (and treated as a Restricted
Payment) by the Issuer or any Restricted Subsidiary in such
Unrestricted Subsidiary.
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(b) The provisions of the foregoing paragraph (a) shall not prohibit:
(i) if no Default or Event of Default shall have occurred and be
continuing, any purchase or redemption of Capital Stock or Subordinated
Obligations of the Issuer made by exchange for, or out of the proceeds of
the substantially concurrent sale of, or capital contribution in respect
of, Capital Stock of the Issuer (other than Disqualified Stock and other
than Capital Stock issued or sold to a Subsidiary of the Issuer);
provided, that (A) such purchase or redemption shall be excluded in the
calculation of the amount of Restricted Payments and (B) the Net Cash
Proceeds from such sale or capital contribution shall be excluded from the
calculation of amounts under clause (iii) (B) of paragraph (a) above;
(ii) if no Default or Event of Default shall have occurred and be
continuing, any purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Obligations made by
exchange for, or out of the proceeds of the substantially concurrent sale
of, Indebtedness of the Issuer which is permitted to be incurred under
Section 4.08; provided, that such purchase, repurchase, redemption,
defeasance or other acquisition or retirement for value shall be excluded
in the calculation of the amount of Restricted Payments;
(iii) dividends paid within sixty (60) days after the date of
declaration thereof if at such date of declaration such dividend would
have complied with this covenant; provided, that at the time of payment of
such dividend, no other Default shall have occurred and be continuing (or
result therefrom); provided further, that such dividend shall be included
in the calculation of the amount of Restricted Payments; and
(iv) if no Default or Event of Default shall have occurred and be
continuing or would result therefrom, any purchase of any fractional share
of Capital Stock of the Issuer resulting from (A) any dividend or other
distribution on outstanding shares of Capital Stock that is payable in
shares of such Capital Stock (including any stock split or subdivision of
the outstanding Capital Stock of the Issuer), (B) any combination of all
of the outstanding shares of Capital Stock of the Issuer, (C) any
reorganization or consolidation of the Issuer in any merger of the Issuer
with or into any other Person or (D) the conversion of any securities of
the Issuer into shares of Capital Stock of the Issuer; provided, that such
purchases shall be included in the calculation of the amount of Restricted
Payments.
SECTION 4.10. Limitation on Restrictions on Distributions from Restricted
Subsidiaries. The Issuer shall not, and shall not permit any Restricted
Subsidiary to, create or otherwise cause or permit to exist or become effective
any consensual encumbrance or restriction on the ability of any Restricted
Subsidiary:
(a) to pay dividends or make any other distributions on its Capital Stock
or any other interest or participation in, or measured by the profits of the
Issuer or such Restricted Subsidiary or pay any Indebtedness owed to the Issuer,
43
(b) to make any loans or advances to the Issuer or to any Restricted
Subsidiary; or
(c) to transfer any of its property or assets to the Issuer or to any
Restricted Subsidiary, except any encumbrance or restriction existing under or
by reason of;
(i) the Senior Credit Facility as in effect on the Issue Date;
(ii) the Notes, this Indenture or the Guarantees;
(iii) any instrument governing Acquired Indebtedness, which
encumbrance or restriction is not applicable to any Person or the
properties or assets of any Person, other than the Person or the
properties or assets of the Person so acquired;
(iv) Refinancing Indebtedness incurred pursuant to an agreement
referred to in clause (i) (ii) or (iii); provided, that the encumbrances
and restrictions contained in any such refinancing agreement are no less
favorable to the Noteholders than encumbrances and restrictions contained
in such agreements governing the Indebtedness being refinanced;
(v) customary nonassignment provisions in leases governing leasehold
interests to the extent such provisions restrict the transfer of the lease
or the property leased thereunder;
(vi) 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;
and
(vii) applicable law.
SECTION 4.11. Limitation on Sales of Assets and Subsidiary Stock.
(a) The Issuer shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, consummate any Asset Sale unless:
(i) the Issuer or such Restricted Subsidiary receives consideration
at the time of such Asset Sale at least equal to the fair market value
(including as to the value of all non-cash consideration) of the shares
and assets subject to such Asset Sale (which fair market value shall be
determined in good faith by the Board of Directors for any transaction (or
series of transactions) involving in excess of $1,000,000) and at least
75% of the consideration received therefor by the Issuer or such
Restricted Subsidiary is in the form of cash or Cash Equivalents and is
received at the time of such sale; and
(ii) an amount equal to 100% of the Net Available Cash from such
Asset Sale is applied by the Issuer (or such Restricted Subsidiary, as the
case may be):
44
(A) first, to the extent the Issuer elects (or is required by
the terms of the Senior Credit Facility or other Senior
Indebtedness), to prepay or repay outstandings under the Senior
Credit Facility or such other Senior Indebtedness; provided, that
(1) there is a permanent reduction in the availability of funds
under the Senior Credit Facility or such other Senior Indebtedness
under a revolving credit facility in an amount equal to such
prepayment or repayment and (2) such prepayment or repayment is made
within one hundred eighty (180) days from the date of such Asset
Sale; and
(B) second, to the extent of the balance of such Net Available
Cash after application in accordance with clause (A), to the extent
the Issuer elects, and within one hundred eighty (180) days from the
date of such Asset Sale, to:
(1) make an investment in properties or assets that
replace the properties or assets that were the subject of such
Asset Sale or in properties or assets that will be used in a
Related Business or
(2) acquire the Capital Stock of a Person that becomes a
Restricted Subsidiary as a result of the acquisition of such
Capital Stock; provided that such Person is, at the time it
becomes a Restricted Subsidiary, engaged in a Related
Business.
(b) Any Net Available Cash not applied within one hundred eighty (180)
days after the consummation of an Asset Sale as provided in clauses (A) or (B)
of paragraph (ii) above will be deemed to constitute "Excess Proceeds." When the
aggregate amount of Excess Proceeds exceeds $5,000,000, the Issuer will be
required to make an offer to all Holders (an "Asset Sale Offer"), to purchase,
on a pro rata basis the principal amount of Notes equal in amount to the Excess
Proceeds (and not just the amount thereof that exceeds $5,000,000) (the "Asset
Sale Offer Amount"), at a purchase price in cash in an amount equal to one
hundred percent (100%) of the principal amount thereof plus accrued and unpaid
interest and Liquidated Damages thereon to the date of purchase (subject to the
right of each Holder of record on the relevant Record Date to receive interest
due on the relevant Interest Payment Date), in accordance with the procedures
set forth in this Indenture, and in accordance with the following standards:
(i) If the aggregate principal amount of Notes surrendered by
Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall
select the Notes (or portions thereof) to be purchased on a pro rata
basis, based on the principal amount of Notes tendered, with such
adjustments as may be deemed appropriate by the Trustee, so that only
Notes (or portions thereof) in denominations of $1,000 or integral
multiples thereof shall be purchased.
(ii) If the aggregate principal amount of Notes tendered pursuant to
such Asset Sale Offer is less than the Excess Proceeds, the Issuer may use
any remaining Excess
45
Proceeds following the completion of the Asset Sale Offer for general
corporate purposes (subject to the other provisions of this Indenture).
Upon completion of an Asset Sale Offer, the amount of Excess Proceeds then
required to be otherwise applied in accordance with this covenant shall be reset
to zero, subject to any subsequent Asset Sale.
(c) In the event of the transfer of substantially all (but not all) of the
property and assets of the Issuer and its Subsidiaries as an entirety to a
Person in a transaction permitted under Section 5.01 below, the successor
corporation shall be deemed to have sold the properties and assets of the Issuer
and its Subsidiaries not so transferred for purposes of this covenant, and shall
comply with the provisions of this covenant with respect to such deemed sale as
if it were an Asset Sale. In addition, the fair market value of such properties
and assets of the Issuer or its Subsidiaries deemed to be sold shall be deemed
to be Net Available Cash for purposes of this covenant.
(d) If at any time any non-cash consideration received by the Issuer or
any Subsidiary in connection with any Asset Sale is converted into or sold or
otherwise disposed of for cash, then such conversion or disposition shall be
deemed to constitute an Asset Sale hereunder and the Net Available Cash thereof
shall be applied in accordance with this covenant.
(e) Within thirty (30) calendar days after the date the amount of Excess
Proceeds exceeds $5,000,000, the Issuer, or the Trustee at the written request
and expense of the Issuer, shall send to each Holder by first-class mail,
postage prepaid, a notice prepared by the Issuer stating:
(i) that an Asset Sale Offer is being made pursuant to this Section
4.11 and that all Notes that are timely tendered will be accepted for
payment, subject to proration if the amount of Excess Proceeds is less
than the aggregate principal amount of all Notes timely tendered pursuant
to the Asset Sale Offer;
(ii) the Asset Sale Offer Amount, the amount of Excess Proceeds that
are available to be applied to purchase tendered Notes, and the date Notes
are to be purchased pursuant to the Asset Sale Offer (the "Asset Sale
Purchase Date"), which date shall be a Business Day no earlier than thirty
(30) calendar days nor later than sixty (60) calendar days subsequent to
the date such notice is mailed;
(iii) that any Notes or portions thereof not tendered or accepted
for payment will continue to accrue interest;
(iv) that, unless the Issuer defaults in the payment of the Asset
Sale Offer Amount with respect thereto, all Notes or portions thereof
accepted for payment pursuant to the Asset Sale Offer shall cease to
accrue interest from and after the Asset Sale Purchase Date;
46
(v) that any Holder electing to have any Notes or portions thereof
purchased pursuant to the Asset Sale Offer will be required to surrender
such Notes, with the form entitled "Option of Holder to Elect Purchase" on
the reverse of such Notes completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day preceding the Asset Sale Purchase Date;
(vi) that any Holder shall be entitled to withdraw such election if
the Paying Agent receives, not later than the close of business on the
fifth Business Day preceding the Asset Sale Purchase Date, a facsimile
transmission or letter, setting forth the name of the Holder, the
principal amount of Notes delivered for purchase, and a statement that
such Holder is withdrawing such Holder's election to have such Notes or
portions thereof purchased pursuant to the Asset Sale Offer;
(vii) that any Holder electing to have Notes purchased pursuant to
the Asset Sale Offer must specify the principal amount that is being
tendered for purchase, which principal amount must be $1,000 or an
integral multiple thereof,
(viii) if Certificated Notes have been issued hereunder, that any
Holder of Certificated Notes whose Certificated Notes are being purchased
only in part will be issued new Certificated Notes equal in principal
amount to the unpurchased portion of the Certificated Note or Notes
surrendered, which unpurchased portion will be equal in principal amount
to $1,000 or an integral multiple thereof,
(ix) that the Trustee will return to the Holder of a Global Note
that is being purchased in part, such Global Note with a notation on
Schedule A thereof adjusting the principal amount thereof to be equal to
the unpurchased portion of such Global Note; and
(x) any other information necessary to enable any Holder to tender
Notes and to have such Notes purchased pursuant to this Section 4.11.
(f) On the Asset Sale Purchase Date, the Issuer shall (i) accept for
payment any Notes or portions thereof properly tendered and selected for
purchase pursuant to the Asset Sale Offer and Section 4.11(e) hereof, (ii)
irrevocably deposit with the Paying Agent, by 10:00 a.m., New York City time, on
such date, in immediately available funds, an amount equal to the Asset Sale
Offer Amount in respect of all Notes or portions thereof so accepted; and (iii)
deliver, or cause to be delivered, to the Trustee the Notes so accepted together
with an Officers' Certificate listing the Notes or portions thereof tendered to
the Issuer and accepted for payment. Subject to the provisions of Section 4.01,
the Paying Agent shall promptly send by first class mail, postage prepaid, to
each Holder of Notes or portions thereof so accepted for payment the Asset Sale
Offer Amount for such Notes or portions thereof. The Issuer shall publicly
announce the results of the Asset Sale Offer on or as soon as practicable after
the Asset Sale Purchase Date. For purposes of this Section 4.11, the Trustee
shall act as the Paying Agent.
(g) Upon surrender and cancellation of a Certificated Note that is
purchased in part, the Issuer shall promptly issue and the Trustee shall
authenticate and deliver to the surrendering Holder of such Certificated Note, a
new Certificated Note equal in principal amount to the
47
unpurchased portion of such surrendered Certificated Note; provided that each
such new Certificated Note shall be in a principal amount of $1,000 or an
integral multiple thereof.
(h) Upon surrender of a Global Note that is purchased in part, the Paying
Agent shall forward such Global Note to the Trustee who shall make a notation on
Schedule A thereof to reduce the principal amount of such Global Note, as
provided in Section 2.06(c) hereof.
(i) The Issuer 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 Notes pursuant to this
Section 4.11. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section, the Issuer shall comply
with the applicable securities laws and regulations and shall not be deemed to
have breached its obligations under this Section 4.11 by virtue thereof.
SECTION 4.12. Limitation on Affiliate Transactions.
(a) Except for transactions entered into or existing prior to the Issue
Date, the Issuer shall not, and shall not permit any Restricted Subsidiary to,
enter into or permit to exist any transaction (including the purchase, sale,
lease or exchange of any property, employee compensation arrangements or the
rendering of any service) with any Affiliate of the Issuer (an "Affiliate
Transaction") unless the terms thereof:
(i) are no less favorable to the Issuer 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;
(ii) if such Affiliate Transaction involves an amount in excess of
$1,000,000, (A) are set forth in writing and (B) have been approved by a
majority of the disinterested members of the Board of Directors; and
(iii) if such Affiliate Transaction involves an amount in excess of
$5,000,000, have been determined by a nationally recognized investment
banking or accounting firm having experience in such matters to be fair,
from a financial point of view, to the Issuer and its Restricted
Subsidiaries.
(b) The provisions of the foregoing paragraph (a) shall not prohibit:
(i) any Restricted Payment permitted to be paid pursuant to Section
4.09;
(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 or
similar employee benefit plans or arrangements approved by the Board of
Directors;
(iii) the grant of stock options or similar rights to employees and
directors of the Issuer pursuant to plans approved by the Board of
Directors;
48
(iv) loans or advances to employees in the ordinary course of
business in accordance with the past practices of the Issuer or its
Restricted Subsidiaries, but in any event not to exceed $1,000,000 in the
aggregate outstanding at any one time;
(v) the payment of reasonable fees to directors of the Issuer and
its Restricted Subsidiaries who are not employees of the Issuer or its
Restricted Subsidiaries; and
(vi) any Affiliate Transaction (x) between the Issuer and a
Restricted Subsidiary or (y) between Restricted Subsidiaries; provided
that, no Affiliate of the Issuer other than a Restricted Subsidiary owns
any Capital Stock in or otherwise has a material financial interest in any
such Restricted Subsidiary.
SECTION 4.13. Limitation on the Sale or Issuance of Capital Stock of
Restricted Subsidiaries. The Issuer shall not sell or otherwise dispose of any
shares of Capital Stock of a Restricted Subsidiary, and shall not permit any
Restricted Subsidiary, directly or indirectly, to issue or sell or otherwise
dispose of any shares of its Capital Stock except to the Issuer or a Restricted
Subsidiary; provided, that this covenant will not prohibit the sale of one
hundred percent (100%) of the shares of the Capital Stock of any Restricted
Subsidiary owned by the Issuer or any Restricted Subsidiary effected in
accordance with Section 4.11 and Section 5.01.
SECTION 4.14. Change of Control.
(a) Upon the occurrence of any of the following events (each a "Change of
Control"), each Holder shall have the right to require that the Issuer
repurchase such Holder's Notes pursuant to the offer described in Section
4.14(b) hereof (the "Change of Control Offer") at a purchase price (the "Change
of Control Purchase Price") in cash equal to one hundred and one percent (101%)
of the aggregate principal amount of such Notes (or portions thereof) to be
redeemed plus accrued and unpaid interest and Liquidated Damages, if any,
thereon, to the purchase date (the "Change of Control Payment Date") (subject to
the right of holders of record on the relevant Record Date to receive interest
due on the relevant Interest Payment Date):
(i) any "person" (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act), other than the Permitted Holders, is or becomes the
beneficial owner (as defined in Rules 13d-3 and l3d-5 under the Exchange
Act, except that for purposes of this clause (i) such person shall be
deemed to have "beneficial ownership" of all shares that any such person
has the right to acquire, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, of more than
thirty-three and one-third percent (33 1/3%) of the total voting power
of the Voting Stock of the Issuer;
(ii) the Issuer merges with or into another Person or sells,
assigns, conveys, transfers, leases or otherwise disposes of all or
substantially all of its assets to any Person, or any Person merges with
or into the Issuer, in any such event pursuant to a transaction in which
the outstanding Voting Stock of the Issuer is converted into or exchanged
for cash, securities or other property, other than any such transaction
where (x) the outstanding Voting Stock of the Issuer is converted into or
exchanged for (1) Voting
49
Stock (other than Disqualified Stock) of the surviving or transferee
corporation and/or (2) cash, securities or other property in an amount
which could be paid by the Issuer as a Restricted Payment under Section
4.09 and (y) immediately after such transaction no "person" or "group"
(within the meaning of Section 13(d) or 14(d) of the Exchange Act) (other
than the Permitted Holders) is the "beneficial owner" (as defined in Rules
13d-3 and l3d-5 under the Exchange Act, except that a person shall be
deemed to have "beneficial ownership" of all shares that any such Person
has the right to acquire, whether such right is exercisable immediately or
only after the passage of time), directly or indirectly, of (1)
thirty-three and one-third percent (33 1/3%) or more of the voting power
of the Voting Stock of the surviving or transferee corporation on a Fully
Diluted basis, after giving effect to the conversion or exercise of all
outstanding warrants, options and other securities of such surviving or
transferee corporation, convertible into or exercisable for Voting Stock
of such surviving or transferee corporation (whether or not such
securities are then currently convertible or exercisable) and (2) a
greater percentage of the voting power of the Voting Stock of such
surviving or transferee corporation calculated on such Fully Diluted
basis, than the percentage beneficially owned by the Permitted Holders;
(iii) during any period of two consecutive years, individuals who at
the beginning of such period constituted the Board of Directors (together
with any new directors whose election by such Board of Directors or whose
nomination for election by the shareholders of the Issuer was approved by
a vote of sixty-six and two-thirds percent (66 2/3%) of the directors of
the Issuer at the time of such approval 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; or
(iv) the liquidation or dissolution of the Issuer.
(b) Within 30 days following any Change of Control, the Issuer shall mail
a notice to each Holder with a copy to the Trustee stating:
(i) that a Change of Control has occurred, the circumstances and
relevant facts with respect to such Change of Control and that a Change of
Control Offer is being made pursuant to this Section 4.14, and that all
Notes (or portions thereof) that are timely tendered will be accepted for
payment;
(ii) the Change of Control Purchase Price, and the Change of Control
Payment Date, which date shall be a Business Day no earlier than thirty
(30) calendar days nor later than sixty (60) calendar days subsequent to
the date such notice is mailed;
(iii) that any Notes or portions thereof not tendered or accepted
for payment will continue to accrue interest;
(iv) that, unless the Issuer defaults in the payment of the Change
of Control Purchase Price with respect thereto, all Notes or portions
thereof accepted for payment
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pursuant to the Change of Control Offer shall cease to accrue interest
from and after the Change of Control Payment Date;
(v) that any Holder electing to have any Notes or portions thereof
purchased pursuant to a Change of Control Offer will be required to tender
such Notes, with the form entitled "Option of Holder to Elect Purchase" on
the reverse of such Notes completed, to the Paying Agent at the address
specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date;
(vi) that any Holder shall be entitled to withdraw such election if
the Paying Agent receives, not later than the close of business on the
fifth Business Day preceding the Change of Control Payment Date, a
facsimile transmission or letter, setting forth the name of the Holder,
the principal amount of Notes delivered for purchase, and a statement that
such Holder is withdrawing such Holder's election to have such Notes or
portions thereof purchased pursuant to the Change of Control Offer;
(vii) that any Holder electing to have Notes purchased pursuant to
the Change of Control Offer must specify the principal amount that is
being tendered for purchase, which principal amount must be $1,000 or an
integral multiple thereof,
(viii) if Certificated Notes have been issued, that any Holder of
Certificated Notes whose Certificated Notes are being purchased only in
part will be issued new Certificated Notes equal in principal amount to
the unpurchased portion of the Certificated Note or Notes surrendered,
which unpurchased portion will be equal in principal amount to $1,000 or
an integral multiple thereof,
(ix) that the Trustee will return to the Holder of a Global Note
that is being purchased in part, such Global Note with a notation on
Schedule A thereof adjusting the principal amount thereof to be equal to
the unpurchased portion of such Global Note; and
(x) any other information necessary to enable any Holder to tender
Notes and to have such Notes purchased pursuant to this Section 4.14.
(c) On the Change of Control Payment Date, the Issuer shall (i) accept for
payment all Notes or portions thereof properly tendered pursuant to the Change
of Control Offer, (ii) irrevocably deposit with the Paying Agent, by 10:00 a.m.,
New York City time, on such date, in immediately available funds, an amount
equal to the Change of Control Purchase Price in respect of all Notes or
portions thereof so tendered and (iii) deliver or cause to be delivered to the
Trustee the Notes so tendered together with an Officers' Certificate stating the
aggregate principal amount of Notes or portions thereof being purchased by the
Issuer. Subject to the provisions of Section 4.01 hereof, the Paying Agent shall
promptly send by first class mail, postage prepaid, to each Holder of Notes or
portions thereof so accepted for payment the Change of Control Purchase Price
for such Notes or portions thereof. The Issuer shall publicly announce the
results of the Change of Control Offer on or as soon as practicable after the
Change of Control Payment Date. For purposes of this Section 4.14, the Trustee
shall act as the Paying Agent.
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(d) Upon surrender and cancellation of a Certificated Note that is
purchased in part pursuant to the Change of Control Offer, the Issuer shall
promptly issue and the Trustee shall authenticate and deliver to the
surrendering Holder of such Certificated Note a new Certificated Note equal in
principal amount to the unpurchased portion of such surrendered Certificated
Note; provided that each such new Certificated Note shall be in a principal
amount of $1,000 or an integral multiple thereof.
Upon surrender of a Global Note that is purchased in part pursuant to a
Change of Control Offer, the Paying Agent shall forward such Global Note to the
Trustee who shall make a notation on Schedule A thereof to reduce the principal
amount of such Global Note to an amount equal to the unpurchased portion of such
Global Note, as provided in Section 2.06(c) hereof.
(e) The Issuer 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 Notes pursuant to this
Section 4.14. To the extent that the provisions of any securities laws or
regulations conflict with provisions of this Section 4.14, the Issuer shall
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.14 by virtue
thereof
(f) Prior to complying with the provisions of this Section 4.14, but in
any event within 30 days following a Change of Control, the Issuer shall, to the
extent required, either repay all outstanding Senior Indebtedness or obtain the
requisite consents, if any, under all agreements governing outstanding Senior
Indebtedness to permit the repurchase of Notes required by this Section 4.14.
SECTION 4.15. Limitation on Liens. Other than Permitted Liens, the Issuer
shall not, and shall not cause or permit any Restricted Subsidiary to, directly
or indirectly, create, incur, assume or permit to exist any Lien on or with
respect to any property or asset (including any document or instrument in
respect of goods or accounts receivable) of the Issuer or of any Restricted
Subsidiary, whether now owned or hereafter acquired, or assign or otherwise
convey any right to receive any income or profits therefrom, or file or permit
the filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the Uniform Commercial Code of any State or under any similar
recording or notice statute, unless (i) in the case of Liens securing
Indebtedness that is expressly subordinate or junior in right of payment to the
Notes, the Notes are secured by a Lien on such property, assets or proceeds that
is senior in priority to such Liens and (ii) in all other cases, the Notes are
equally and ratably secured.
SECTION 4.16. Limitation on Layered Indebtedness. The Issuer shall not,
and shall not permit any Restricted Subsidiary to, directly or indirectly, incur
any Indebtedness that is subordinate in right of payment to any other
Indebtedness, unless such Indebtedness is subordinate in right of payment to, or
ranks pari passu with, the Notes or, in the case of Restricted Subsidiaries that
are Guarantors, such Indebtedness is subordinate in right of payment to, or
ranks pari passu with, the Guarantees of such Guarantors.
52
The Guarantors will not, directly or indirectly, guarantee any
Indebtedness of the Issuer that is subordinate in right of payment to any other
Indebtedness of the Issuer unless such guarantee is subordinate in right of
payment to, or ranks pari passu with, the Guarantees of such Guarantors.
SECTION 4.17. Compliance Certificate. The Issuer shall deliver to the
Trustee within one hundred twenty (120) days after the end of each fiscal year
of the Issuer an Officers' Certificate stating that in the course of the
performance by the signers of their duties as Officers of the Issuer they would
normally have knowledge of any Default and whether or not the signers know of
any Default that occurred during such period. If they do, the certificate shall
describe the Default, its status and what action the Issuer is taking or
proposes to take with respect thereto. The Issuer also shall comply with TIA
Section 314(a)(4).
SECTION 4.18. Waiver of Stay, Extension or Usury Laws. Neither the Issuer
nor any Guarantor will at any time, to the extent that they may lawfully not do
so, insist upon, or plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law that
would prohibit or forgive the Issuer or its Subsidiaries or the Note from paying
all or any portion of the principal of or premium, if any, or interest or
Liquidated Damages, if any, on the Notes as contemplated herein, wherever
enacted, now or at any time hereafter in force, or that may affect the covenants
or the performance of this Indenture; and, to the extent that they may lawfully
do so, the Issuer and the Guarantors hereby expressly waive all benefit or
advantage of any such law and expressly agree that they will not hinder, delay
or impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
SECTION 4.19. Investment Company Act. None of the Issuer or its
Subsidiaries shall become an investment company subject to registration under
the Investment Company Act of 1940, as amended.
SECTION 4.20. Limitation on Conduct of Business. The Issuer and its
Restricted Subsidiaries will not engage in any business other than a Related
Business.
SECTION 4.21. Further Instruments and Acts. Upon request of the Trustee,
the Issuer 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.
ARTICLE 5
SUCCESSOR COMPANY
SECTION 5.01. When Issuer May Merge or Transfer Assets.
(a) The Issuer shall not, and shall not permit any Restricted Subsidiary
to, consolidate with or merge with or into any Person (other than the
consolidation or merger of a Restricted Subsidiary with another Restricted
Subsidiary or into the Issuer), or sell, assign, convey, transfer, lease or
otherwise dispose of (or permit any Subsidiary to sell, assign, convey,
transfer, lease or
53
otherwise dispose of), in one transaction or a series of transactions, all or
substantially all its assets (determined on a consolidated basis for the Issuer
and its Subsidiaries) to, any Person, unless:
(i) the Issuer, in the case of a transaction involving the Issuer,
or such Restricted Subsidiary in the case of a transaction involving a
Restricted Subsidiary, shall be the resulting, surviving or transferee
Person or the resulting, surviving or transferee Person (in either case,
the "Successor Company") shall be a Person organized and existing under
the laws of the United States of America, any State thereof or the
District of Columbia and the Successor Company (if not the Issuer or such
Restricted Subsidiary) shall expressly assume, by an indenture
supplemental thereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of the Issuer under the
Notes and this Indenture, or the obligation of such Restricted Subsidiary
under its Guarantee, as the case may be;
(ii) immediately after giving effect to such transaction (and
treating any Indebtedness which becomes an obligation of the Successor
Company as a result of such transaction as having been incurred by such
Successor Company at the time of such transaction), no Default shall have
occurred and be continuing,
(iii) immediately after giving effect to such transaction, the
Issuer, if the transaction involves a Restricted Subsidiary, or the
Successor Company would be able to incur an additional $1.00 of
Indebtedness pursuant to the second sentence of Section 4.08,
(iv) in the case of a transaction involving the Issuer, immediately
after giving effect to such transaction, the Successor Company shall have
Consolidated Net Worth in an amount that is not less than the Consolidated
Net Worth of the Issuer prior to such transaction;
(v) if, as a result of any such transaction, property or assets of
the Issuer or a Restricted Subsidiary would become subject to a Lien
securing Indebtedness not excepted from the provisions of this Indenture
described above under Section 4.15, the Issuer, any such Restricted
Subsidiary or the Successor Company, as the case may be, shall have
secured the Notes and the relevant Guarantees, as required by such
provisions; and
(vi) the Issuer shall 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.
(b) the Successor Company shall be the successor to the Issuer or such
Restricted Subsidiary, as the case may be, and shall succeed to, and be
substituted for, and may exercise every right and power of, the Issuer or such
Restricted Subsidiary under this Indenture, but the predecessor Issuer or
Restricted Subsidiary in the case of a conveyance, transfer or lease shall not
be released from the obligation to pay the principal of and interest on the
Notes.
54
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. The term "Event of Default," wherever
used herein with respect to the Notes, means any one of the following events
(whatever the reason for such event, and whether it shall be voluntary or
involuntary, or be effected by operation of law, pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the Issuer defaults in any payment of interest on or Liquidated
Damages with respect to any Note when the same becomes due and payable, whether
or not such payment shall be prohibited by Article 10, and such default
continues for a period of thirty (30) days;
(b) the Issuer (i) defaults in the payment of the principal of, or
premium, if any, on any Note when the same becomes due and payable at its Stated
Maturity, upon redemption, upon declaration or otherwise, whether or not such
payment shall be prohibited by Article 10, or (ii) fails to redeem or purchase
Notes when required pursuant to this Indenture or the Notes, whether or not such
payment shall be prohibited by Article 10;
(c) the Issuer fails to observe or perform any covenant, condition or
agreement on the part of the Issuer to be observed or performed pursuant to
Sections 4.08, 4.09, 4.11, 4.14 and 5.01;
(d) the Issuer fails to comply with any of its other agreements or
covenants in or provisions of the Notes or this Indenture and such failure
continues for thirty (30) days after the notice specified below;
(e) Indebtedness of the Issuer or any Subsidiary is not paid within any
applicable grace period after final maturity or is accelerated by the holders
thereof because of a default and the total amount of such Indebtedness unpaid or
accelerated exceeds $5,000,000 or its foreign currency equivalent at the time;
(f) the entry by a court having jurisdiction in the premises of (i) a
decree or order for relief in respect of the Issuer or any Subsidiary of the
Issuer in an involuntary case or proceeding under any Bankruptcy Law or (ii) a
decree or order (A) adjudging the Issuer or any Subsidiary of the Issuer a
bankrupt or insolvent, or (B) approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of, or in respect of, the
Issuer or any Subsidiary of the Issuer under any Bankruptcy Law, or (C)
appointing a Custodian of the Issuer or any Subsidiary of the Issuer or of any
substantial part of the Property of the Issuer or any Subsidiary of the Issuer,
or (D) ordering the winding-up or liquidation of the affairs of the Issuer or
any Subsidiary of the Issuer, and in each case, the continuance of any such
decree or order for relief or any such other decree or order unstayed and in
effect for a period of sixty (60) consecutive calendar days; or
55
(g) (i) the commencement by the Issuer or any Subsidiary of the Issuer of
a voluntary case or proceeding under any Bankruptcy Law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent; or (ii) the consent by the
Issuer or any Subsidiary of the Issuer to the entry of a decree or order for
relief in respect of the Issuer or any Subsidiary of the Issuer in an
involuntary case or proceeding under any Bankruptcy Law or to the commencement
of any bankruptcy or insolvency case or proceeding against the Issuer or any
Subsidiary of the Issuer; or (iii) the filing by the Issuer or any Subsidiary of
the Issuer of a petition or answer or consent seeking reorganization or relief
under any Bankruptcy Law; or (iv) the consent by the Issuer or any Subsidiary of
the Issuer to the filing of such petition or to the appointment of or taking
possession by a Custodian of the Issuer or any Subsidiary of the Issuer or of
any substantial part of the Property of the Issuer or any Subsidiary of the
Issuer, or (v) the making by the Issuer or any Subsidiary of the Issuer of an
assignment for the benefit of creditors; or (vi) the admission by the Issuer or
any Subsidiary of the Issuer in writing of its inability to pay its debts
generally as they become due; or (vii) the approval by stockholders of the
Issuer or any Subsidiary of the Issuer of any plan or proposal for the
liquidation or dissolution of the Issuer or any Subsidiary of the Issuer; or
(viii) the taking of corporate action by the Issuer or any Subsidiary of the
Issuer in furtherance of any such action; or
(h) any judgment or decree for the payment of money in excess of
$5,000,000 or its foreign currency equivalent at the time is entered against the
Issuer or any Subsidiary, remains outstanding for a period of sixty (60) days
following the entry of such judgment or decree and is not discharged, waived or
the execution thereof stayed within ten (10) days after the notice specified
below; or
(i) the Guarantee of any Guarantor ceases to be in full force and effect
(other than in accordance with the terms of such Guarantee) or any Guarantor
denies or disaffirms its obligations under its Guarantee.
A Default under clause (d) is not an Event of Default until the Trustee or
the Holders of at least twenty-five percent (25%) in principal amount of the
Notes notify the Issuer of the Default and the Issuer 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 Issuer shall deliver to the Trustee, within thirty (30) days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (c), (e), (h) or (i) and any event which with
the giving of notice or the lapse of time would become an Event of Default under
clause (d), its status and what action the Issuer is taking or proposes to take
with respect thereto.
SECTION 6.02. Acceleration. If an Event of Default (other than an Event of
Default specified in Section 6.01(f) or (g) with respect to the Issuer) occurs
and is continuing, the Trustee by written notice to the Issuer, or the Holders
of at least twenty-five (25%) in principal amount of the Notes by written notice
to the Issuer and the Trustee, may declare the principal of, premium, if any,
and accrued but unpaid interest and Liquidated Damages, if any, on all the Notes
to be due and payable. Upon such a declaration, such principal, premium, if any,
and interest and Liquidated Damages, if any, shall be due and payable
immediately. If an Event of Default specified in Section 6.01(f) or (g) with
respect to the Issuer occurs, the principal of, premium, if any, and
56
interest and Liquidated Damages, if any, on all the Notes shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Noteholders. The Holders of a majority in
principal amount of the Notes by written notice to the Trustee and the Issuer
may rescind an acceleration and its consequences if the rescission would not
conflict with any judgment or decree and if all existing Events of Default have
been cured or waived except nonpayment of principal, premium, if any, or
interest and Liquidated Damages, if any, that has become due solely because of
such acceleration. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
SECTION 6.03. Other Remedies. The Issuer covenants that if an Event of
Default specified in Section 6.01(a) or 6.01(b) occurs, the Issuer shall, upon
demand of the Trustee, pay to the Trustee, for the benefit of the Holders, the
whole amount then due and payable on the Notes for principal, premium, if any,
and interest and Liquidated Damages, if any, and, to the extent that payment of
such interest shall be legally enforceable, interest upon the overdue principal
(and premium, if any) and upon Defaulted Interest (and Liquidated Damages, if
any) at the rate or rates prescribed therefor in the Notes, and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, including the
allocated reasonable costs of its in-house counsel and legal staff, and all
other amounts due to the Trustee pursuant to Section 7.07 hereof.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal of, premium, if any, or
interest or Liquidated Damages, if any, on the Notes or to enforce the
performance of any provision of the Notes or this Indenture. The Trustee may
maintain a proceeding even if it does not possess any of the Notes or does not
produce any of them in the proceeding. A delay or omission by the Trustee or any
Noteholder in exercising any right or remedy accruing upon an Event of Default
shall not impair the right or remedy or constitute a waiver of or acquiescence
in the Event of Default. No remedy is exclusive of any other remedy. All
available remedies are cumulative.
SECTION 6.04. Waiver of Past Defaults. The Holders of not less than a
majority in principal amount of the Notes by written notice to the Trustee may,
on behalf of the Holders of all the Notes, waive an existing Default or Event of
Default and its consequences except a continuing Default or Event of Default (i)
in the payment of the principal of, premium, if any or interest or Liquidated
Damages, if any, on a Note (except a payment default resulting from an
acceleration that has been rescinded) or (ii) in respect of a provision that
under Section 9.02 cannot be amended without the consent of each Noteholder
affected.
SECTION 6.05. Control by Majority. The Holders of not less than a majority
in principal amount of the Notes 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 7.01, that the Trustee determines is unduly prejudicial to
the rights of other Noteholders or would involve the Trustee in personal
liability; provided, that
57
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 satisfactory to it in its sole
discretion against all losses and expenses caused by taking or not taking such
action.
SECTION 6.06. Limitation on Suits. A Noteholder may not pursue any remedy
with respect to this Indenture or the Notes unless:
(a) the Holder has previously given to the Trustee written notice stating
that an Event of Default is continuing;
(b) the Holders of at least twenty-five percent (25%) in principal amount
of the Notes have made a written request to the Trustee to pursue the remedy in
respect of such Event of Default in its own name as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee reasonable security
or indemnity against any loss, liability or expense to be incurred in compliance
with such request;
(d) the Trustee has not complied with the request within sixty (60) days
after receipt of the request and the offer of security or indemnity; and
(e) the Holders of a majority in principal amount of the Notes have not
given the Trustee a direction inconsistent with the request during such sixty
(60) day period.
A Noteholder may not use this Indenture to prejudice the rights of another
Noteholder or to obtain a preference or priority over another Noteholder.
SECTION 6.07. Rights of Holders To Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment of
principal of, premium, if any, and interest and Liquidated Damages, if any, on
the Notes held by such Holder, on or after the respective due dates expressed in
the Notes, or the Redemption Dates or purchase dates provided for therein or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.08. Collection Suit by Trustee. If an Event of Default specified
in Section 6.01(a) or (b) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Issuer
for the whole amount then due and owing on the Notes for principal, premium, if
any, and interest and Liquidated Damages, if any, and, to the extent that
payment of such interest shall be legally enforceable, interest upon the overdue
principal (and premium, if any) and upon Defaulted Interest (and Liquidated
Damages, if any) and the amounts provided for in Section 7.07.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file such
proofs of claim and other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee and the Noteholders allowed in any
judicial proceedings relative to the Issuer, its creditors or its property and,
unless prohibited by law or applicable regulations, may
58
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 7.07.
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:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to holders of Senior Indebtedness of the Issuer to the
extent required by Article 10 or Article 12;
THIRD: to Noteholders for amounts due and unpaid on the Notes
for principal of, premium, if any, and interest and Liquidated Damages,
if any, ratably, without preference or priority of any kind, according
to the amounts due and payable on the Notes for principal and interest,
respectively; and
FOURTH: to the Issuer.
The Trustee may fix a Record Date and payment date for any payment to
Noteholders pursuant to this Section 6.10. At least fifteen (15) days before
such Record Date, the Issuer shall mail to each Noteholder 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 in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section 6.11 does not apply to a suit initiated
by the Trustee, a suit initiated by a Holder pursuant to Section 6.07 or a suit
initiated by Holders of more than ten percent (10%) in principal amount of the
Notes.
SECTION 6.12. Waiver of Stay or Extension Laws. The Issuer (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 Issuer (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.
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ARTICLE 7
TRUSTEE
SECTION 7.01. 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:
(i) 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 against the
Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section 7.01;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Issuer.
(e) Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
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(f) 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.
(g) 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 7.01 and to the provisions of the TIA.
SECTION 7.02. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to be genuine and
to have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may 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 any
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or 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, that the Trustee's conduct does not constitute willful
misconduct or 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 Notes 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) Any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Officers' Certificate and any resolution of the
Board of Directors may be sufficiently evidenced by a Board Resolution.
(g) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request 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.
SECTION 7.03. Individual Rights of Trustee. The Trustee in its individual
or any other capacity may become the owner or pledgee of Notes and may otherwise
deal with the Issuer, the Guarantors or their Affiliates with the same rights it
would have if it were not Trustee.
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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 7.04. 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 Notes, it shall not be accountable for the Issuer's use of the proceeds
from the Notes, and it shall not be responsible for any statement of the Issuer
in this Indenture or in any document issued in connection with the sale of the
Notes or in the Notes other than the Trustee's certificate of authentication.
SECTION 7.05. Notice of Defaults. If a Default occurs and is continuing
and if it is actually known to the Trustee, the Trustee shall mail to each
Noteholder notice of the Default within 90 days after it occurs. Except in the
case of a Default in the payment of principal of, premium, if any, or interest
or Liquidated Damages, if any, on any Note (including payments pursuant to the
mandatory redemption provisions of such Note, if any), the Trustee may withhold
the notice if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interests of Noteholders.
SECTION 7.06. 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 Noteholder a brief report dated as of May 15 that complies with TIA
Section 313(a). The Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Noteholders shall be
filed with the SEC and each stock exchange (if any) on which the Notes are
listed. The Issuer agrees to notify promptly the Trustee in writing whenever the
Notes become listed on any stock exchange and of any delisting thereof.
SECTION 7.07. Compensation and Indemnity. The Issuer shall pay to the
Trustee from time to time compensation for its services as the Issuer and the
Trustee shall from time to time agree in writing. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Issuer 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 the compensation for its services. Such expenses shall include the
reasonable compensation and expenses, disbursements and advances of the
Trustee's agents and counsel, including the allocated reasonable costs of its
in-house counsel and legal staff. The Issuer hereby agrees to indemnify and hold
the Trustee and its directors, officers, agents and employees (collectively, the
"Indemnitees") harmless from and against any and all claims, liabilities,
losses, damages, fines, penalties, and expenses, including out-of-pocket,
incidental expenses, legal fees and expenses, and the allocated reasonable costs
and expenses of in-house counsel and legal staff ("Losses") that may be imposed
on, incurred by, or asserted against, the Indemnitees or any of them for
following any instruction or other direction upon which the Trustee is
authorized to rely pursuant to the terms of this Indenture. In addition to and
not in limitation of the immediately preceding sentence, the Issuer also agrees
to indemnify and hold the Indemnitees and each of them harmless from and against
any and all Losses that may be imposed on, incurred by, or asserted against the
Indemnitees or any of them in connection with or arising out of the Trustee's
performance under this Indenture, provided the Trustee has not acted with
negligence or engaged
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in willful misconduct. The provisions of this Section 7.07 shall survive the
termination of this Indenture and the resignation or removal of the Trustee for
any reason. The Trustee shall notify the Issuer promptly of any claim for which
it may seek indemnity. Failure by the Trustee to so notify the Issuer shall not
relieve the Issuer of its obligations hereunder. The Issuer shall defend the
claim and the Trustee shall cooperate in the defense of the claim; provided that
the Trustee may have separate counsel and the Issuer shall pay the reasonable
fees and expenses of such counsel if the actual or potential defendants in, or
the targets of, any such claim include both the Trustee and the Issuer and the
Trustee shall have reasonably concluded that there may be legal defenses
available to it which are different from or additional to those available to the
Issuer. The Trustee will not, without the prior written consent of the Issuer,
settle or compromise or consent to the entry of any judgment with respect to any
claim in respect of which indemnification may be sought hereunder. The Issuer
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.
To secure the Issuer's payment obligations in this Section 7.07, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee other than money or property held in trust to pay
principal of, premium, if any, and interest and Liquidated Damages, if any, on
particular Notes.
The Issuer's payment obligations pursuant to this Section 7.07 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(f) or (g) with respect to
the Issuer, the expenses are intended to constitute expenses of administration
under the Bankruptcy Law.
SECTION 7.08. Replacement of Trustee. The Trustee may resign at any time
by so notifying the Issuer. The Holders of not less than a majority in principal
amount of the Notes may remove the Trustee by so notifying the Trustee in
writing and may appoint a successor Trustee. The Issuer 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 Issuer or by the Holders of a
majority in principal amount of the Notes 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 Issuer shall promptly appoint a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Issuer. 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 Noteholders. 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 7.07.
If a successor Trustee does not take office within thirty (30) days after
the retiring Trustee resigns or is removed, the retiring Trustee or the Holders
of not less than ten percent (10%) in principal amount of the Notes 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 Noteholder 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
7.08, the Issuer's obligations under Section 7.07 shall continue for the benefit
of the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger. Any corporation or association
into which the Trustee in its individual capacity may be merged or converted or
with which it may be consolidated, or any corporation or association resulting
from any merger, conversion or consolidation to which the Trustee in its
individual capacity shall be a party or any corporation or association to which
all or substantially all the corporate trust business of the Trustee in its
individual capacity may be sold or otherwise transferred, shall be the Trustee
hereunder without further act.
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 Notes 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 Notes so authenticated; and in case at
that time any of the Notes shall not have been authenticated, any successor to
the Trustee may authenticate such Notes 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 Notes or
in this Indenture provided that the certificate of authentication of the Trustee
shall have.
SECTION 7.10. Eligibility; Disqualification. The Trustee shall at all
times satisfy the requirements of TIA Section 310(a). The Trustee shall have a
combined capital and surplus of at least $50,000,000 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 certificates of interest or participation in other securities of
the Issuer are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
SECTION 7.11. Preferential Collection of Claims Against Issuer. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section
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311(b). A Trustee who has resigned or been removed shall be subject to TIA
Section 311(a) to the extent indicated.
SECTION 7.12. Trustee's Application for Instructions from the Issuer. Any
application by the Trustee for written instructions from the Issuer may, at the
option of the Trustee, be set forth in writing and shall state any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
three Business Days after the date any Officer of the Issuer actually receives
such application, unless any such Officer shall have consented in writing to any
earlier date) unless prior to taking any such action (or the effective date in
the case of an omission), the Trustee shall have received written instructions
in response to such application specifying the action to be taken or omitted.
ARTICLE 8
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01. Discharge of Liability on Notes; Defeasance.
(a) When
(i) the Issuer delivers to the Trustee all outstanding Notes (other
than Notes replaced pursuant to Section 2.08) for cancellation or
(ii) all outstanding Notes have become due and payable, whether at
Stated Maturity or as a result of the mailing of a notice of redemption
pursuant to Article 3 hereof and the Issuer irrevocably deposits with the
Trustee funds sufficient to pay at Stated Maturity or upon redemption all
outstanding Notes, including interest accrued and unpaid thereon to Stated
Maturity or such Redemption Date (other than Notes replaced pursuant to
Section 2.08), and if in either case the Issuer pays all other sums
payable hereunder by the Issuer, then this Indenture shall, subject to
Section 8.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the
Issuer accompanied by an Officers' Certificate and an Opinion of Counsel
addressed to the Trustee and at the cost and expense of the Issuer.
(b) Subject to Sections 8.01(c) and 8.02, the Issuer at any time may
terminate:
(i) all its obligations under the Notes and this Indenture ("legal
defeasance option") subject to the following which shall survive until
otherwise terminated or discharged hereunder:
(A) the rights of Holders of outstanding Notes to receive
payments in respect of the principal of, premium, if any, and
interest and Liquidated Damages, if any, on such Notes when payments
are due from the trust referred to below,
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(B) the Issuer's obligations with respect to such Notes under
Sections 2.03, 2.04, 2.07, 2.08, 2.10, 4.02, 4.03 and 4.04 hereof,
(C) the Issuer's obligations under the Registration Rights
Agreement,
(D) the rights, powers, trusts, duties and immunities of the
Trustee under this Indenture and the Issuer's obligations in
connection therewith,
(E) Article 3 hereof, and
(F) this Article 8; or
(ii) its obligations under Sections 4.05 through 4.16 and 4.20 and
the operation of Section 6.01(c) (but only as it applies to Section
5.01(a)(iii) and (iv)), 6.01(e), 6.01(f), 6.01(g) and 6.01(h) or contained
in Section 5.01(a)(iii) and (iv) ("covenant defeasance option"). The
Issuer may exercise its legal defeasance option notwithstanding its prior
exercise of its covenant defeasance option.
If the Issuer exercises its legal defeasance option, payment of the Notes
may not be accelerated because of an Event of Default. If the Issuer exercises
its covenant defeasance option, payment of the Notes may not be accelerated
because of an Event of Default specified in Sections 6.01(c), 6.01(d), and
6.01(i) or because of the failure of the Issuer to comply with Section
5.01(a)(iii) and (iv). If the Issuer exercises its legal defeasance option or
its covenant defeasance option, each Guarantor shall be released from all of its
obligations under its Guarantee.
Upon satisfaction of the conditions set forth herein and upon request of
the Issuer, the Trustee shall acknowledge in writing the discharge of those
obligations that the Issuer terminates.
(c) Notwithstanding clauses (a) and (b) above, the Issuer's obligations in
Sections 8.04, 8.05 and 8.06 shall survive.
SECTION 8.02. Conditions to Defeasance. The Issuer may exercise its legal
defeasance option or its covenant defeasance option only if
(a) the Issuer irrevocably deposits in trust with the Trustee money or
U.S. Government Obligations for the payment of principal of and interest on the
Notes to maturity or redemption, as the case may be;
(b) the Issuer 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 deposited money without
investment will provide cash at such times and in such amounts as will
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be sufficient to pay principal of, premium, if any, and interest and Liquidated
Damages, if any, when due on all the Notes to Stated Maturity or redemption, as
the case may be;
(c) one hundred twenty-three (123) days pass (or Stated Maturity or a
Redemption Date is reached if such time period is less than one hundred
twenty-three (123) days) after the deposit is made and during the one hundred
twenty-three (123) day period (or such lesser period as provided for above) no
Default specified in Sections 6.01(f) or (g) with respect to the Issuer occurs
which is continuing at the end of the period;
(d) the deposit does not result in a breach or violation of, or constitute
a default under any other agreement or instrument binding on the Issuer or any
of its Subsidiaries and is not prohibited by Article 10;
(e) the Issuer delivers to the Trustee an Opinion of Counsel addressed to
the Trustee 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;
(f) in the case of the legal defeasance option, the Issuer shall have
delivered to the Trustee an Opinion of Counsel addressed to the Trustee stating
that (i) the Issuer has received from, or there has been published by, the
Internal Revenue Service a ruling, or (ii) since the date of this Indenture
there has been a change in the applicable Federal income tax law, in either case
to the effect that, and based thereon such Opinion of Counsel shall confirm
that, the Noteholders will not recognize income, gain or loss for Federal income
tax purposes as a result of such defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance had not occurred;
(g) in the case of the covenant defeasance option, the Issuer shall have
delivered to the Trustee an Opinion of Counsel addressed to the Trustee to the
effect that the Noteholders will not recognize income, gain or loss for Federal
income tax purposes as a result of such covenant defeasance and will be subject
to Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such covenant defeasance had not occurred;
(h) the Issuer delivers to the Trustee an Officers' Certificate and an
Opinion of Counsel addressed to the Trustee, each stating that all conditions
precedent to the defeasance and discharge of the Notes as contemplated by this
Article 8 have been complied with;
(i) the Issuer shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Issuer with the intent
of preferring the Holders over any other creditors of the Issuer or with the
intent of defeating, hindering, delaying or defrauding any other creditors of
the Issuer or others; and
(j) such legal defeasance or covenant defeasance shall not cause the
Trustee to have a conflicting interest within the meaning of the TIA (assuming
for the purpose of this clause (j) that all Notes are in default within the
meaning of such Act).
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Before or after a deposit, the Issuer may make arrangements satisfactory
to the Trustee for the redemption of Notes at a future date in accordance with
Article 3.
SECTION 8.03. 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 through the Paying Agent and in accordance with this Indenture to
the payment of principal of, premium, if any, and interest and Liquidated
Damages, if any, on the Notes.
Money and securities so held in trust are not subject to Article 10.
SECTION 8.04. Repayment to Issuer. The Trustee and the Paying Agent shall
promptly turn over to the Issuer upon written 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 Issuer upon
written request any money held by them for the payment of principal of, premium,
if any, or interest or Liquidated Damages, if any, that remains unclaimed for
two years, and, thereafter, Noteholders entitled to the money must look to the
Issuer for payment as general creditors.
SECTION 8.05. Indemnity for Government Obligation. The Issuer 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.
SECTION 8.06. 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 Issuer's obligations under this Indenture and the Notes
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, that, if the Issuer has made any payment of interest on or
principal of any Notes because of the reinstatement of its obligations, the
Issuer shall be subrogated to the rights of the Holders of such Notes to receive
such payment from the money or U.S. Government Obligations held by the Trustee
or Paying Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. Without Consent of Holders. The Issuer and the Trustee may
amend this Indenture or the Notes without notice to or consent of any
Noteholder:
(a) to cure any ambiguity, omission, defect or inconsistency;
(b) to comply with Article 5;
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(c) to provide for uncertificated Notes in addition to or in place of
Certificated Notes; provided, that the uncertificated Notes are issued in
registered form for purposes of Section 163(f) of the Internal Revenue Code or
in a manner such that the uncertificated Notes are described in Section
163(f)(2)(B) of the Internal Revenue Code;
(d) to make any change in Article 10 or Article 12 that would limit or
terminate the benefits available to any holder of Senior Indebtedness (or
Representatives thereof) under Article 10 or Article 12;
(e) to add Guarantees with respect to the Notes or to secure the Notes;
(f) to add to the covenants of the Issuer for the benefit of the Holders
or to surrender any right or power herein conferred upon the Issuer;
(g) to comply with any requirements of the SEC in connection with
qualifying, or maintaining the qualification of, this Indenture under the TIA;
or
(h) to make any change that does not adversely affect the rights of any
Noteholder.
An amendment under this Section 9.01 may not make any change that
adversely affects the rights under Article 10 or Article 12 of any holder of
Senior Indebtedness then outstanding unless the holders of such Senior
Indebtedness (or any group or Representative thereof authorized to give a
consent) consent in writing to such change.
After an amendment under this Section 9.01 becomes effective, the Issuer
shall mail to Noteholders a notice briefly describing such amendment. The
failure to give such notice to all Noteholders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section 9.01.
SECTION 9.02. With Consent of Holders. The Issuer and the Trustee may
amend this Indenture or the Notes without notice to any Noteholder but with the
written consent of the Holders of at least a majority in principal amount of the
Notes then outstanding and any past Default or compliance with any provisions
may also be waived with the consent of the Holders of not less than a majority
of the principal amount of Notes then outstanding. However, without the consent
of each Noteholder affected, an amendment may not:
(a) reduce the amount of Notes whose Holders must consent to an amendment;
(b) reduce the rate of or extend the time for payment of interest on any
Note;
(c) reduce the principal of or extend the Stated Maturity of any Note;
(d) reduce the premium payable upon the redemption of any Note or change
the time at which any Note may be redeemed in accordance with Article 3;
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(e) make any Note payable in money other than that stated in the Note;
(f) make any change in Article 10 or Article 12 that adversely affects the
rights of any Noteholder under Article 10 or Article 12;
(g) make any change in Section 6.04 or 6.07 or the second sentence of
this Section 9.02; or
(h) make any change in any Guarantee that would adversely affect the
Noteholders.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof
An amendment under this Section 9.02 may not make any change that
adversely affects the rights under Article 10 or Article 12 of any holder of
Senior Indebtedness then outstanding unless the holders of such Senior
Indebtedness (or any group or Representative thereof authorized to give a
consent) consent in writing to such change.
After an amendment under this Section 9.02 becomes effective, the Issuer
shall mail to Noteholders a notice briefly describing such amendment. The
failure to give such notice to all Noteholders, or any defect therein, shall not
impair or affect the validity of an amendment under this Section.
SECTION 9.03. Compliance with Trust Indenture Act. Every amendment to this
Indenture or the Notes shall comply with the TIA as then in effect.
SECTION 9.04. Revocation and Effect of Consents and Waivers. A consent to
an amendment or a waiver by a Holder of a Note shall bind the Holder and every
subsequent Holder of that Note or portion of the Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent or waiver
is not made on the Note. However, any such Holder or subsequent Holder may
revoke the consent or waiver as to such Holder's Note or portion of the Note if
the Trustee receives the notice of revocation before the date the amendment or
waiver becomes effective. After an amendment or waiver becomes effective, it
shall bind every Noteholder. An amendment or waiver becomes effective upon the
execution of such amendment or waiver by the Trustee.
The Issuer may, but shall not be obligated to, fix a Record Date for the
purpose of determining the Noteholders 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 Noteholders 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.
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SECTION 9.05. Notation on or Exchange of Notes. If an amendment changes
the terms of a Note, the Trustee may require the Holder of the Note to deliver
it to the Trustee. The Trustee may place an appropriate notation on the Note
regarding the changed terms and return it to the Holder. Alternatively, if the
Issuer or the Trustee so determines, the Issuer in exchange for the Note shall
issue and the Trustee shall authenticate and deliver a new Note that reflects
the changed terms. Failure to make the appropriate notation or to issue a new
Note shall not affect the validity of such amendment.
SECTION 9.06. 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 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such
amendment is authorized or permitted by this Indenture and that such amendment
constitutes the legal, valid and binding obligation of the Issuer and each
Guarantor, subject to customary exceptions.
SECTION 9.07. Payment for Consent. Neither the Issuer nor any Affiliate of
the Issuer shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder for
or as an inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Notes unless such consideration is offered
to be paid to all Holders that so consent, waive or agree to amend in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.
ARTICLE 10
SUBORDINATION OF THE NOTES
SECTION 10.01. Agreement To Subordinate. The Issuer agrees, and each
Noteholder by accepting a Note agrees, that the Indebtedness evidenced by the
Notes is subordinated in right of payment, to the extent and in the manner
provided in this Article 10, to the prior payment of all Senior Indebtedness of
the Issuer and that the subordination is for the benefit of and enforceable by
the holders of such Senior Indebtedness. Only Indebtedness that is Senior
Indebtedness will rank senior to the Notes in accordance with the provisions set
forth herein. The Notes shall in all respects rank pari passu with, or be senior
to, all other Indebtedness of the Issuer. All provisions of this Article 10
shall be subject to Section 10.12.
SECTION 10.02. Liquidation, Dissolution, Bankruptcy. Upon any payment or
distribution of the assets of the Issuer to creditors upon a total or partial
liquidation or a total or partial dissolution of the Issuer or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Issuer or its property:
(a) holders of Senior Indebtedness of the Issuer shall be entitled to
receive payment in full of such Senior Indebtedness in cash or cash equivalents
before Noteholders shall be entitled to receive any payment of principal of,
premium, if any, or interest or Liquidated Damages, if any, on the Notes; and
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(b) until such Senior Indebtedness is paid in full in cash or cash
equivalents, any distribution to which Noteholders would be entitled but for
this Article 10 shall be made to holders of such Senior Indebtedness as their
interests may appear, except that Noteholders may receive (i) securities of a
Person that are subordinated ("Subordinated Reorganization Securities") to such
Senior Indebtedness to at least the same extent as the Notes are subordinated to
(A) Senior Indebtedness of the Issuer and (B) any securities issued in exchange
for Senior Indebtedness, and (ii) payments and other distributions made from any
defeasance trust created pursuant to Section 8.01 hereof.
SECTION 10.03. Default on Senior Indebtedness of the Issuer. The Issuer
may not pay the principal of, premium, if any, or interest or Liquidated
Damages, if any, on the Notes or make any deposit pursuant to Section 8.01 and
may not repurchase, redeem or defease any Notes (collectively, "pay the Notes")
(other than Subordinated Reorganization Securities and payments and other
distributions made from any defeasance trust created pursuant to Section 8.01
hereof) if (i) any Designated Senior Indebtedness of the Issuer is not paid when
due or (ii) any other default on such Designated Senior Indebtedness occurs and
the maturity of such Designated Senior Indebtedness is accelerated in accordance
with its terms unless, in either case, (x) the default has been cured or waived
and any such acceleration has been rescinded or (y) such Designated Senior
Indebtedness has been paid in full; provided, however, that the Issuer may pay
the Notes without regard to the foregoing if the Issuer and the Trustee receive
written notice approving such payment from the Representative of such Designated
Senior Indebtedness. During the continuance of any default (other than a default
described in clause (i) or (ii) of the preceding sentence) with respect to any
Designated Senior Indebtedness of the Issuer 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 Issuer may not pay the Notes for a period (a
"Payment Blockage Period") commencing upon the receipt by the Issuer and the
Trustee of written notice (a "Blockage Notice") of such default from the
Representative 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 Issuer from the Person or Persons who gave such Blockage Notice, (ii) by
repayment in full of such Designated Senior Indebtedness or (iii) because the
Representative of the holders of such Designated Senior Indebtedness shall have
notified the Trustee in writing that the default giving rise to such Blockage
Notice is no longer continuing). Notwithstanding the provisions described in the
immediately preceding sentence (but subject to the provisions contained in the
first sentence of this Section 10.03), unless the holders of such Designated
Senior Indebtedness or the Representative of such holders shall have accelerated
the maturity of such Designated Senior Indebtedness, the Issuer may resume
payments on the Notes after such Payment Blockage Period. Not more than one
Blockage Notice may be given in any consecutive 360-day period, irrespective of
the number of defaults with respect to Designated Senior Indebtedness during
such period. For purposes of this Section 10.03, no default or event of default
which existed or was continuing on the date of the commencement of any Payment
Blockage Period with respect to the Designated Senior Indebtedness initiating
such Payment Blockage Period shall be, or be made, the basis of the commencement
of a subsequent Payment Blockage Period by the Representative of such Designated
Senior Indebtedness, whether or not within a period of 360
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consecutive days, unless such default or event of default shall have been cured
or waived for a period of not less than 90 consecutive days.
SECTION 10.04. Acceleration of Payment of Notes. If payment of the Notes
is accelerated because of an Event of Default, the Issuer shall promptly notify
the holders of the Designated Senior Indebtedness of the Issuer (or their
Representative) of the acceleration.
SECTION 10.05. When Distribution Must Be Paid Over. If a distribution is
made to Noteholders that because of this Article 10 should not have been made to
them, the Issuer shall so notify the Noteholders who receive the distribution,
which Noteholders shall hold it in trust for holders of Senior Indebtedness of
the Issuer and pay it over to them as their interests may appear.
SECTION 10.06. Subrogation. After all Senior Indebtedness of the Issuer is
paid in full and until the Notes are paid in full, Noteholders shall be
subrogated to the rights of holders of such Senior Indebtedness to receive
distributions applicable to such Senior Indebtedness. A distribution made under
this Article 10 to holders of such Senior Indebtedness which otherwise would
have been made to Noteholders is not, as between the Issuer and Noteholders, a
payment by the Issuer on such Senior Indebtedness.
SECTION 10.07. Relative Right. This Article 10 defines the relative rights
of Noteholders and holders of Senior Indebtedness of the Issuer. Nothing in this
Indenture shall:
(a) impair, as between the Issuer and Noteholders, the obligation of the
Issuer, which is absolute and unconditional, to pay principal of, premium, if
any, and interest and Liquidated Damages, if any, on the Notes in accordance
with their terms; or
(b) prevent the Trustee or any Noteholder from exercising its available
remedies upon a Default, subject to the rights of holders of Senior Indebtedness
of the Issuer to receive distributions otherwise payable to Noteholders.
SECTION 10.08. Subordination May Not Be Impaired by Issuer. No right of
any holder of Senior Indebtedness of the Issuer to enforce the subordination of
the Indebtedness evidenced by the Notes shall be impaired by any act or failure
to act by the Issuer or by its failure to comply with this Indenture.
SECTION 10.09. Rights of Trustee and Paying Agent. Notwithstanding Section
10.03, the Trustee or Paying Agent may continue to make payments on the Notes
and shall not be charged with knowledge of the existence of facts that would
prohibit the making of any such payments unless, not less than two Business Days
prior to the date of such payment, a Trust Officer of the Trustee receives
written notice from a holder of Designated Senior Indebtedness that it is
exercising its rights under Section 10.03. The Issuer, the Registrar or
co-registrar, the Paying Agent, a Representative or a holder of Senior
Indebtedness may give the notice; provided, however, that, if the holders of an
issue of Senior Indebtedness of the Issuer have a Representative, only the
Representative may give the notice.
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The Trustee in its individual or any other capacity may hold Senior
Indebtedness of the Issuer with the same rights it would have if it were not
Trustee. The Registrar and coregistrar and the Paying Agent may do the same with
like rights. The Trustee shall be entitled to all the rights set forth in this
Article 10 with respect to any Senior Indebtedness of the Issuer which may at
any time be held by it, to the same extent as any other holder of such Senior
Indebtedness, and nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 10 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
SECTION 10.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of the Issuer, the distribution may be made and the notice given to their
Representative (if any).
SECTION 10.11. Article 10 Not To Prevent Events of Default or Limit Right
To Accelerate. The failure to make a payment pursuant to the Notes by reason of
any provision in this Article 10 shall not be construed as preventing the
occurrence of a Default. Nothing in this Article 10 shall have any effect on the
right of the Noteholders or the Trustee to accelerate the maturity of the Notes.
SECTION 10.12. Trust Moneys Not Subordinated. Notwithstanding anything
contained herein to the contrary, payments from money or the proceeds of U.S.
Government Obligations held in trust under Article 8 by the Trustee for the
payment of principal of, premium, if any, and interest and Liquidated Damages,
if any, on the Notes shall not be subordinated to the prior payment of any
Senior Indebtedness or subject to the restrictions set forth in this Article 10,
and none of the Noteholders or Trustee shall be obligated to pay over any such
amount to the Issuer or any holder of Senior Indebtedness of the Issuer or any
other creditor of the Issuer.
SECTION 10.13. Trustee Entitled To Rely. Upon any payment or distribution
pursuant to this Article 10, the Trustee and the Noteholders shall be entitled
to rely (i) upon any order or decree of a court of competent jurisdiction in
which any proceedings of the nature referred to in Section 10.02 are pending,
(ii) upon a certificate of the liquidating trustee or agent or other Person
making such payment or distribution to the Trustee or to the Noteholders or
(iii) upon the Representative for the holders of Senior Indebtedness of the
Issuer for the purpose of ascertaining the Persons entitled to participate in
such payment or distribution, the holders of such Senior Indebtedness and other
Indebtedness of the Issuer, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article 10. In the event that the Trustee determines, in good faith, that
evidence is required with respect to the right of any Person as a holder of
Senior Indebtedness of the Issuer to participate in any payment or distribution
pursuant to this Article 10, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and other facts
pertinent to the rights of such Person under this Article 10, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment. The provisions of Sections 7.01 and 7.02 shall be applicable to all
actions or omissions of actions by the Trustee pursuant to this Article 10.
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SECTION 10.14. Trustee To Effectuate Subordination. Each Noteholder by
accepting a Note authorizes and directs the Trustee on such Noteholder's behalf
to take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination between the Noteholders and the holders of Senior
Indebtedness of the Issuer as provided in this Article 10 and appoints the
Trustee as attorney-in-fact for any and all such purposes.
SECTION 10.15. Trustee Not Fiduciary for Holders of Senior Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to the holders of
Senior Indebtedness and shall not be liable to any such holders if it shall
mistakenly pay over or distribute to Noteholders or the Issuer or any other
Person, money or assets to which any holders of Senior Indebtedness of the
Issuer shall be entitled by virtue of this Article 10 or otherwise.
SECTION 10.16. Reliance by Holders of Senior Indebtedness on Subordination
Provisions. Each Noteholder by accepting a Note acknowledges and agrees that
the foregoing subordination provisions are, and are intended to be, an
inducement and a consideration to each holder of any Senior Indebtedness of the
Issuer, whether such Senior Indebtedness was created or acquired before or after
the issuance of the Notes, to acquire and continue to hold, or to continue to
hold, such Senior Indebtedness and such holder of such Senior Indebtedness shall
be deemed conclusively to have relied on such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness.
SECTION 10.17. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Issuer or
by any act or failure to act, in good faith, by any such holder, or by any
non-compliance by the Issuer with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
be otherwise charged with.
(b) Without limiting the generality of subsection (a) of this section, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Noteholders, without incurring
responsibility to the Noteholders and without impairing or releasing the
subordination provided in this Article or the obligations hereunder of the
Noteholders to the holders of Senior Indebtedness, do any one or more of the
following:
(i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, or waive compliance with the terms of,
Senior Indebtedness or any instrument evidencing the same or any agreement
under which Senior Indebtedness is outstanding;
(ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Indebtedness;
(iii) release any Person liable in manner for the collection or
payment of Senior Indebtedness; or
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(iv) exercise or refrain from exercising any rights against the
Issuer and any other Person;
provided, however, that in no event shall any such actions limit the right of
the Noteholders to take any action to accelerate the maturity of the Notes
pursuant to Article 6 of this Indenture or to pursue any rights or remedies
hereunder or under applicable laws if the taking of such action does not
otherwise violate the terms of this Article, subject to the rights, if any,
under this Article of the holders from time to time of Senior Indebtedness to
receive the cash, property or securities receivable upon the exercise of such
rights or remedies.
SECTION 10.18. Other Rights of Holders of Senior Indebtedness. All rights
and interest under this Indenture of the holders of Senior Indebtedness and all
agreements and obligations of the Trustee, the Noteholders and the Issuer under
this Article shall remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of the Senior Credit
Facility and promissory notes evidencing the Senior Credit Facility or any
other agreement or instrument relating thereto or to any other Senior
Indebtedness; or
(b) any other circumstance that might constitute a defense available
to or a discharge of a guarantor or surety (other than as a result of any
payments made on the Senior Credit Facility or other Senior Indebtedness).
The holders of Senior Indebtedness are hereby authorized to demand
specific performance of this Article at any time when the Trustee, the Issuer or
any Noteholder shall have failed to comply with any of these provisions.
The provisions of this Article shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the Senior
Indebtedness is rescinded or must otherwise be returned by any holder of Senior
Indebtedness upon the insolvency, bankruptcy or reorganization of the Issuer or
otherwise, all as though such payment had not been made.
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ARTICLE 11
GUARANTEES; RELEASE OF GUARANTEES;
ADDITIONAL GUARANTEES
SECTION 11.01. Guarantees.
(a) Each Guarantor hereby unconditionally and irrevocably guarantees to
each Holder and to the Trustee and its successors and assigns (i) the full and
punctual payment of principal of, premium, if any, and interest and Liquidated
Damages, if any, on the Notes when due, whether at maturity, by acceleration, by
redemption or otherwise, and all other monetary obligations of the Issuer under
this Indenture and the Notes and (ii) the full and punctual performance within
applicable grace periods of all other obligations of the Issuer under this
Indenture and the Notes (all the foregoing being hereinafter collectively called
the "Obligations"). Each Guarantor further agrees that the Obligations may be
extended or renewed, in whole or in part, without notice or further assent from
such Guarantor and that such Guarantor will remain bound under this Article 11
notwithstanding any extension or renewal of any Obligation.
(b) Each Guarantor waives presentation to, demand of, payment from and
protest to the Issuer of any of the Obligations and also waives notice of
protest for nonpayment. Each Guarantor waives notice of any default under the
Notes or the Obligations. The obligations of each Guarantor hereunder shall not
be affected by (i) the failure of any Holder or the Trustee to assert any claim
or demand or to enforce any right or remedy against the Issuer or any other
Person under this Indenture, the Notes or any other agreement or otherwise, (ii)
any extension or renewal of any thereof, (iii) any rescission, waiver, amendment
or modification of any of the terms or provisions of this Indenture, the Notes
or any other agreement, (iv) the release of any security held by any Holder or
the Trustee for the Obligations or any of them, (v) the failure of any Holder or
Trustee to exercise any right or remedy against any other guarantor of the
Obligations, or (vi) any change in the ownership of any Guarantor.
(c) Each Guarantor further agrees that its 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 Obligations.
(d) Each 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 all Senior Indebtedness of such Guarantor and is made subject to such
provisions of this Indenture.
(e) Except as expressly set forth in Section 8.01(b), the obligations of
each 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 Obligations or
otherwise. Without limiting the generality of the foregoing, (i) the obligations
of each Guarantor herein shall not be discharged or impaired or otherwise
affected by the failure of any Holder or the Trustee to assert
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any claim or demand or to enforce any remedy under this Indenture, the Notes or
any other agreement, by any waiver or modification of any thereof, by any
default, failure or delay, willful or otherwise, in the performance of the
Obligations, or by any other act or thing or omission or delay to do any other
act or thing which may or might in any manner or to any extent vary the risk of
each Guarantor or would otherwise operate as a discharge of such Guarantor as a
matter of law or equity and (ii) each Guarantor hereby waives any right such
Guarantor may have under Sections 26.7 through 26.9 of the North Carolina
General Statutes.
(f) Each Guarantor further agrees that its 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, premium, if any, or interest or Liquidated
Damages, if any, on any Obligation is rescinded or must otherwise be restored by
any Holder or the Trustee upon the bankruptcy or reorganization of the Issuer or
otherwise.
(g) 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
Guarantor by virtue hereof, upon the failure of the Issuer to pay the principal
of, premium, if any or interest or Liquidated damages, if any, 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 Obligation, each
Guarantor hereby promises to and will, upon receipt of written demand by the
Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the
Trustee an amount equal to the sum of (i) the unpaid amount of such Obligations,
(ii) accrued and unpaid interest on such Obligations (but only to the extent not
prohibited by law) and (iii) all other monetary Obligations of the Issuer to the
Holders and the Trustee.
(h) Each Guarantor agrees that it shall not be entitled to any right of
subrogation in respect of any Obligations guaranteed hereby until payment in
full of all Obligations and all obligations to which the Obligations are
subordinated as provided in Article 12. Each 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 Obligations guaranteed hereby may be accelerated as
provided in Article 6 for the purposes of such Guarantor's 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 Guarantor for the purposes of this Section 10.01.
(i) Each Guarantor also agrees to pay any and all costs and expenses
(including reasonable attorneys' fees and expenses, including the allocated
reasonable costs and expenses of its in-house counsel and legal staff) incurred
by the Trustee or any Holder in enforcing any rights under this Section 11.01.
SECTION 11.02. Successors and Assigns. This Article 11 shall be binding
upon each Guarantor and its successors and assigns and shall inure 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
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and in the Notes shall automatically extend to and be vested in such transferee
or assignee, all subject to the terms and conditions of this Indenture.
SECTION 11.03. 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 11.04. Modification. No modification, amendment or waiver of any
provision of this Article 11, nor the consent to any departure by any 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 Guarantor in any case shall entitle such Guarantor to any other
or further notice or demand in the same, similar or other circumstances.
SECTION 11.05. Limitation of Guarantor's Liability. Each Guarantor, the
Trustee, and by its acceptance hereof each Holder, hereby confirms that it is
the intention of all such parties that the Guarantee of such Guarantor not
constitute a fraudulent transfer or conveyance for purposes of the Bankruptcy
Law, federal and state fraudulent conveyance laws or any similar federal, state
or foreign law. To effectuate the foregoing intention, the Holders, the Trustee
and each Guarantor hereby irrevocably agree that the obligations of each
Guarantor under this Article 11 shall be limited to the maximum amount as will,
after giving effect to all other contingent and fixed liabilities of such
Guarantor and after giving effect to any collections from or payments made by or
on behalf of any other Guarantor in respect of the obligations of such other
Guarantor under this Article 11, result in the obligations of such Guarantor
under its Guarantee not constituting a fraudulent transfer or conveyance under
applicable federal, state or foreign law.
SECTION 11.06. Release of Guarantees. In the event of a sale or other
disposition of all or substantially all of the assets of any Guarantor, by way
of merger, consolidation or otherwise, or a sale or other disposition of all of
the Capital Stock of any Guarantor, by way of merger, consolidation or
otherwise, such Guarantor (in the event of a sale or other disposition of all of
the Capital Stock of such Guarantor) will be released and relieved of any
obligations under its Guarantee or the Person acquiring the property (in the
event of a sale or other disposition of all or substantially all of the assets
of such Guarantor) will not be required to enter into a Guarantee; provided, in
each case, that such transaction is carried out pursuant to and in accordance
with Section 4.11 and Section 5.01 (if applicable) hereof. Upon delivery by the
Issuer to the Trustee of an Officers' Certificate and Opinion of Counsel
addressed to the Trustee, to the effect that such sale or other disposition was
made by the Issuer in accordance with the provisions of this Indenture,
including without limitation Section 4.11 and Section 5.01 (if applicable)
hereof, the Trustee shall execute any documents reasonably required in order to
evidence the release of any such Guarantor from its obligations under its
Guarantee.
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SECTION 11.07. Additional Guarantees. The Issuer will cause any Person
that shall become a Restricted Subsidiary (an "Additional Guarantor") to
concurrently guarantee (an "Additional Guarantee") the Issuer's obligations
under this Indenture and the Notes to the same extent that the Guarantors have
guaranteed the Issuer's obligations under this Indenture and the Notes;
provided, that each Additional Guarantor will be automatically and
unconditionally released and discharged from its obligations under such
Additional Guarantee only in accordance with Section 11.06 above; provided,
further, that each Additional Guarantor's liability will be limited in
accordance with Section 11.05 above.
ARTICLE 12
SUBORDINATION OF THE GUARANTEES
SECTION 12.01. Agreement To Subordinate. Each Guarantor agrees, and each
Noteholder by accepting a Note agrees, that the obligations of such Guarantor
are subordinated in right of payment, to the extent and in the manner provided
in this Article 12, to the prior payment of all Senior Indebtedness of such
Guarantor and that the subordination is for the benefit of and enforceable by
the holders of such Senior Indebtedness. Only Senior Indebtedness of each
Guarantor shall rank senior to the obligations of such Guarantor in accordance
with the provisions set forth herein. The obligations of each Guarantor shall in
all respects rank pari passu with, or be senior to, all other Indebtedness of
such Guarantor.
SECTION 12.02. Liquidation, Dissolution, Bankruptcy. Upon any payment or
distribution of the assets of any Guarantor to creditors upon a total or partial
liquidation or a total or partial dissolution of such Guarantor or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the such Guarantor or its property:
(1) holders of Senior Indebtedness of such Guarantor shall be entitled to
receive payment in full of such Senior Indebtedness in cash or cash equivalents
before Noteholders shall be entitled to receive any payment pursuant to the
Guarantee of such Guarantor; and
(2) until the Senior Indebtedness of such Guarantor is paid in full in
cash or cash equivalents, any distribution to which Noteholders would be
entitled but for this Article 12 shall be made to holders of such Senior
Indebtedness as their interests may appear, except that Noteholders may receive
Subordinated Reorganization Securities and payments and other distributions made
from any defeasance trust created pursuant to Section 8.01 hereof.
SECTION 12.03. Default on Senior Indebtedness of Guarantor. No Guarantor
may make any payment pursuant to any of its obligations or repurchase, redeem or
otherwise retire or defease any Notes or other Obligations (collectively, "pay
its Guarantee") (other than Subordinated Reorganization Securities and payments
and other distributions from any defeasance trust created pursuant to Section
8.01 hereof) if (i) any Designated Senior Indebtedness of the relevant Guarantor
is not paid when due or (ii) any other default on Designated Senior Indebtedness
of such Guarantor occurs and the maturity of such Designated Senior Indebtedness
is accelerated in accordance with its terms unless, in either case, the default
has been cured or waived and any such acceleration has been rescinded or such
Designated
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Senior Indebtedness has been paid in full. However, such Guarantor may pay its
Guarantee without regard to the foregoing if such Guarantor and the Trustee
receive written notice approving such payment from the Representative of the
Designated Senior Indebtedness of such Guarantor with respect to which either of
the events set forth in clause (i) or (ii) of the immediately preceding sentence
has occurred and is continuing. During the continuance of any default (other
than a default described in clause (i) or (ii) of the second preceding sentence)
with respect to any Designated Senior Indebtedness of such 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, such Guarantor may not pay its
Guarantee for the Payment Blockage Period commencing upon the receipt by the
Trustee (with a copy to such Guarantor) of a Blockage Notice from the
Representative of the holders of such Designated Senior Indebtedness and ending
179 days thereafter (or earlier if such Payment Blockage Period is terminated
(i) by written notice to the Trustee and such Guarantor from the Person or
Persons who gave such Blockage Notice, (ii) because a Representative of the
holders of such Designated Senior Indebtedness has notified the Trustee that the
default giving rise to such Blockage Notice is no longer continuing or (iii)
because such Designated Senior Indebtedness has been repaid in full).
Notwithstanding the provisions described in the immediately preceding sentence
(but subject to the first sentence of this paragraph), unless the holders of
such Designated Senior Indebtedness of such Guarantor or the Representative of
such holders have accelerated the maturity of such Designated Senior
Indebtedness, such Guarantor may resume payments on its Guarantee after the end
of such Payment Blockage Period. Each Guarantee shall not be subject to more
than one Payment Blockage Period in any consecutive 360-day period, irrespective
of the number of defaults with respect to Designated Senior Indebtedness of a
Guarantor during such period. For purposes of this Section 12.03, no default or
event of default which existed or was continuing on the date of the commencement
of any Payment Blockage Period with respect to the Designated Senior
Indebtedness initiating such Payment Blockage Period shall be, or be made, the
basis of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, whether or not within a
period of 360 consecutive days, unless such default or event of default shall
have been cured or waived for a period of not less than 90 consecutive days.
SECTION 12.04. Demand for Payment. If a demand for payment is made on any
Guarantor pursuant to Article 11, such Guarantor shall promptly notify the
holders of the Designated Senior Indebtedness (or their Representatives) of such
Guarantor of such demand.
SECTION 12.05. When Distribution Must Be Paid Over. If a distribution is
made to Noteholders that because of this Article 12 should not have been made to
them, the applicable Guarantor shall notify the Noteholders who receive the
distribution, which Noteholders shall hold it in trust for holders of the
relevant Senior Indebtedness of such Guarantor and pay it over to them or their
Representative as their interests may appear.
SECTION 12.06. Subrogation. After all Senior Indebtedness of each
Guarantor is paid in full and until the Notes are paid in full, Noteholders
shall be subrogated to the rights of holders of such Senior Indebtedness to
receive distributions applicable to such Senior Indebtedness. A distribution
made under this Article 12 to holders of such Senior Indebtedness
81
which otherwise would have been made to Noteholders is not, as between each
Guarantor and Noteholders, a payment by such Guarantor on such Senior
Indebtedness.
SECTION 12.07. Relative Rights. This Article 12 defines the relative
rights of Noteholders and holders of Senior Indebtedness of each Guarantor.
Nothing in this Indenture shall:
(1) impair, as between each Guarantor and the Noteholders, the obligation
of the such Guarantor, which is absolute and unconditional, to pay its
obligations to the extent set forth in Article 11; or
(2) prevent the Trustee or any Noteholder from exercising its available
remedies upon a default by any Guarantor under its obligations, subject to the
rights of holders of Senior Indebtedness of such Guarantor to receive
distributions otherwise payable to Noteholders.
SECTION 12.08. Subordination May Not Be Impaired by Guarantor. No right of
any holder of Senior Indebtedness of any Guarantor to enforce the subordination
of the obligations of such Guarantor shall be impaired by any act or failure to
act by such Guarantor or by its failure to comply with this Indenture.
SECTION 12.09. Rights of Trustee and Paying Agent. Notwithstanding Section
12.03, the Trustee or Paying Agent may continue to demand payments on each
Guarantee and shall not be charged with knowledge of the existence of facts that
would prohibit the making of any such payments unless, not less than two
Business Days prior to the date of such payment, a Trust Officer of the Trustee
receives written notice from a holder of Designated Senior Indebtedness that it
is exercising its rights under Section 12.03. The Issuer, each Guarantor, the
Registrar or co-registrar, the Paying Agent, a Representative or a holder of
Senior Indebtedness of any Guarantor may give the notice; provided, however,
that, if an issue of Senior Indebtedness of any Guarantor has a Representative,
only the Representative may give the notice.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness of any Guarantor with the same rights it would have if it were not
Trustee. The Registrar and co-registrar and the Paying Agent may do the same
with like rights. The Trustee shall be entitled to all the rights set forth in
this Article 12 with respect to any Senior Indebtedness of any Guarantor which
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 12 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.07.
SECTION 12.10. Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of Senior Indebtedness
of any Guarantor, the distribution may be made and the notice given to their
Representative (if any).
SECTION 12.11. Article 12 Not To Prevent Defaults Under the Guarantees or
Limit Right To Demand Payment. The failure to make a payment pursuant to any
Guarantee by reason of any provision in this Article 12 shall not be construed
as preventing the occurrence of a
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default under such Guarantee. Nothing in this Article 12 shall have any effect
on the right of the Noteholders or the Trustee to make a demand for payment on
any Guarantor pursuant to Article 11.
SECTION 12.12. Trustee Entitled To Rely. Upon any payment or distribution
pursuant to this Article 12, the Trustee and the Noteholders shall be entitled
to rely (i) upon any order or decree of a court of competent jurisdiction in
which any proceedings of the nature referred to in Section 12.02 are pending,
(ii) upon a certificate of the liquidating trustee or agent or other Person
making such payment or distribution to the Trustee or to the Noteholders or
(iii) upon the Representative for the holders of Senior Indebtedness of any
Guarantor for the purpose of ascertaining the Persons entitled to participate in
such payment or distribution, the holders of such Senior Indebtedness and other
indebtedness of such Guarantor, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article 12. In the event that the Trustee determines, in good
faith, that evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness of such Guarantor to participate in any payment or
distribution pursuant to this Article 12, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness of such Guarantor held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution and
other facts pertinent to the rights of such Person under this Article 12, and,
if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment. The provisions of Sections 7.01 and 7.02 shall be applicable to
all actions or omissions of actions by the Trustee pursuant to this Article 12.
SECTION 12.13. Trustee To Effectuate Subordination. Each Noteholder by
accepting a Note authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination between the Noteholders and the holders of Senior Indebtedness of
any Guarantor as provided in this Article 12 and appoints the Trustee as
attorney-in-fact for any and all such purposes.
SECTION 12.14. Trustee Not Fiduciary for Holders of Senior Indebtedness of
Guarantors. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness of any Guarantor and shall not be liable to any
such holders if it shall mistakenly pay over or distribute to Noteholders or the
Issuer or any other Person, money or assets to which any holders of such Senior
Indebtedness shall be entitled by virtue of this Article 12 or otherwise.
SECTION 12.15. Reliance by Holders of Senior Indebtedness on Subordination
Provisions. Each Noteholder by accepting a Note acknowledges and agrees that
the foregoing subordination provisions are, and are intended to be, an
inducement and a consideration to each holder of any Senior Indebtedness of any
Guarantor, whether such Senior Indebtedness was created or acquired before or
after the issuance of the Notes, 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 on such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness.
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SECTION 12.16. No Waiver of Subordination Provisions.
(a) No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of any Guarantor
or by any act or failure to act, in good faith, by any such holder, or by any
non-compliance by any Guarantor with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
be otherwise charged with.
(b) Without limiting the generality of subsection (a) of this section, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Noteholders, without incurring
responsibility to the Noteholders and without impairing or releasing the
subordination provided in this Article or the obligations hereunder of the
Noteholders to the holders of Senior Indebtedness, do any one or more of the
following:
(i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, or waive compliance with the terms of,
Senior Indebtedness or any instrument evidencing the same or any agreement
under which Senior Indebtedness is outstanding;
(ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Indebtedness;
(iii) release any Person liable in manner for the collection or
payment of Senior Indebtedness; or
(iv) exercise or refrain from exercising any rights against the
Guarantor and any other Person;
provided, however, that in no event shall any such actions limit the right of
the Noteholders to take any action to accelerate the maturity of the Notes
pursuant to Article 6 of this Indenture or to pursue any rights or remedies
hereunder or under applicable laws if the taking of such action does not
otherwise violate the terms of this Article, subject to the rights, if any,
under this Article of the holders from time to time of Senior Indebtedness to
receive the cash, property or securities receivable upon the exercise of such
rights or remedies.
SECTION 12.17. Other Rights of Holders of Senior Indebtedness. All rights
and interest under this Indenture of the holders of Senior Indebtedness and all
agreements and obligations of the Trustee, the Noteholders and the Guarantors
under this Article shall remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of the Senior Credit
Facility and promissory notes evidencing the Senior Credit Facility or any
other agreement or instrument relating thereto or to any other Senior
Indebtedness; or
84
(b) any other circumstance that might constitute a defense available
to or a discharge of a guarantor or surety (other than as a result of any
payments indefeasibly made on the Senior Credit Facility or other Senior
Indebtedness).
The holders of Senior Indebtedness are hereby authorized to demand
specific performance of this Article at any time when the Trustee, any Guarantor
or any Noteholder shall have failed to comply with any of these provisions.
The provisions of this Article shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the Senior
Indebtedness is rescinded or must otherwise be returned by any holder of Senior
Indebtedness upon the insolvency, bankruptcy or reorganization of any Guarantor
or otherwise, all as though such payment had not been made.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01. 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.
SECTION 13.02. Notices. Any notice or communication by the Issuer, any
Guarantor or the Trustee to the others is duly given if in writing and delivered
in Person or mailed by first class mail (registered or certified, return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery,
to the others' address as follows:
if to the Issuer and/or any Guarantor:
Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxxxx
if to the Trustee:
Chase Manhattan Trust Company, National Association
0000 Xxxxxx Xxxxxx, Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000
Attention: Capital Markets Fiduciary Services
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(Phoenix Color Corp. 10 3/8% Senior Subordinated Notes due
2009)
The Issuer, any Guarantor or the Trustee, by notice to the others may
designate additional or different addresses for subsequent notices or
communication.
85
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt acknowledged, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, to its address shown on
the register kept by the Registrar. Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent required by
the TIA. Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Issuer mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each agent at the same time.
SECTION 13.03. Communication by Holders with Other Holders. Noteholders
may communicate pursuant to TIA Section 312(b) with other Noteholders with
respect to their rights under this Indenture or the Notes. The Issuer, the
Trustee, the Registrar and anyone else shall have the protection of TIA Section
312(c).
SECTION 13.04. Certificate and Opinion as to Conditions Precedent. Upon
any request or application by the Issuer to the Trustee to take or refrain from
taking any action under this Indenture, the Issuer shall furnish to the Trustee:
(1) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with; and
(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 13.05. 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;
86
(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 13.06. When Notes Disregarded. In determining whether the Holders
of the required principal amount of Notes have concurred in any direction,
waiver or consent, Notes owned by the Issuer or by any Affiliate of the Issuer
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 Notes which the Trustee knows are so
owned shall be so disregarded. Also, subject to the foregoing, only Notes
outstanding at the time shall be considered in any such determination.
SECTION 13.07. Rules by Trustee, Paying Agent and Registrar. The Trustee
may make reasonable rules for action by or a meeting of Noteholders. The
Registrar and the Paying Agent may make reasonable rules for their functions.
SECTION 13.08. Legal Holidays. A "Legal Holiday" is a Saturday, a Sunday
or a day on which banking institutions are not required or are not authorized to
be open in the Commonwealth of Pennsylvania or State of New York. 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 13.09. Governing Law. (a) THIS INDENTURE AND THE NOTES SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE.
(b) Each of the Issuer and each Guarantor hereby (i) agrees that any suit,
action or proceeding against it arising out of or relating to this Indenture or
the Notes, as the case may be, may be instituted in any Federal or state court
sitting in The City of New York, (ii) waives, to the extent permitted by
applicable law, any objection which it may now or hereafter have to the laying
of venue of any such suit, action or proceeding, and any claim that any suit,
action or proceeding in such a court has been brought in an inconvenient forum,
(iii) irrevocably submits to the non-exclusive jurisdiction of such courts in
any suit, action or proceeding, (iv) agrees that final judgment in any such
suit, action or proceeding brought in such a court shall be conclusive and
binding upon each and may be enforced in the courts of the jurisdiction of which
each is subject, respectively, by a suit upon judgment, (v) agrees that service
of process by mail to the addressed specified in Section 13.02 hereof shall
constitute personal service of such process on it in any such suit, action or
proceeding.
SECTION 13.10. No Recourse Against Others. No director, officer, employee,
incorporator or stockholder of the Issuer or any Guarantor, as such, shall have
any liability for
87
any obligations of the Issuer or such Guarantor under the Notes, the Guarantees
or this Indenture or for any claim based on, in respect of, or by reason of,
such obligations or their creation, solely by reason of its status as a
director, officer, employee, incorporator or stockholder of the Issuer or such
Guarantor. By accepting a Note, each Holder waives and releases all such
liability (but only such liability) as part of the consideration for issuance of
such Note to such Holder.
SECTION 13.11. Successors, Assigns and Transferees. All agreements of the
Issuer and each Guarantor in this Indenture and the Notes shall bind their
respective successors and assigns. All agreements of the Trustee and the Initial
Purchaser in this Indenture shall bind their respective successors, assigns and
transferees.
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 table 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. In case any provision in this Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 13.15. Further Instruments and Acts. Upon request of the Trustee,
the Issuer and each Guarantor 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 purposes of this Indenture.
[SIGNATURE PAGES FOLLOW]
88
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
PHOENIX COLOR CORP.,
as Issuer,
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Chief Financial Officer
PHOENIX (MD) REALTY, LLC,
as Guarantor
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Chief Financial Officer
PCC EXPRESS, INC.,
as Guarantor
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Chief Financial Officer
CHASE MANHATTAN TRUST COMPANY,
NATIONAL ASSOCIATION
as Trustee
By: /s/ X. X. Xxxxxx
---------------------------------
Name: X.X. Xxxxxx
Title: Vice President
[Indenture]
EXHIBIT A
FORM OF INITIAL GLOBAL NOTE
FACE OF INITIAL GLOBAL NOTE
PHOENIX COLOR CORP.
No. _____ CUSIP No. ________________
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO.
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE
UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS
SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE ACT)
OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a)(1), (2), (3)
OR (7) UNDER THE ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON
AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL
NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF,
(B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 000X XXXXX XXX XXX, (X) XXXXXX XXX XXXXXX XXXXXX TO AN ACCREDITED
INVESTOR THAT IS ACQUIRING THIS NOTE FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
SUCH AN ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF
$250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, THAT, PRIOR
TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S.
BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM
OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE THE UNITED STATES
IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE ACT, (E)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE ACT
(IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS
TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY
TRANSFER OF THIS NOTE WITHIN TWO YEARS AFTER ORIGINAL ISSUANCE OF THIS NOTE, IF
THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO
SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUER SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE 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 ACT. AS USED
HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE
THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE ACT.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO PHOENIX COLOR CORP. OR A SUCCESSOR THEREOF OR THE REGISTRAR FOR
REGISTRATION OF TRANSFER OR EXCHANGE AND ANY NOTE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, AND NOT IN
PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF INTERESTS IN THIS GLOBAL NOTE SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.07 OF THE INDENTURE, DATED AS OF FEBRUARY 2, 1999, AMONG PHOENIX COLOR
CORP., AS ISSUER, THE GUARANTORS LISTED THEREIN AND CHASE MANHATTAN TRUST
COMPANY, NATIONAL ASSOCIATION, AS TRUSTEE, PURSUANT TO WHICH THIS NOTE WAS
ISSUED.
GLOBAL NOTE
REPRESENTING 10-3/8% SENIOR SUBORDINATED NOTES DUE 2009
Phoenix Color Corp., a Delaware corporation, for value received, hereby
promises to pay to Cede & Co., or its registered assigns, the principal sum
indicated on Schedule A hereof, on February 1, 2009.
Interest Payment: Dates: February 1 and August 1, commencing August 1,
1999.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse by manual signature, this Note shall not
be entitled to any benefit under the Indenture or be valid or obligatory for any
purposes.
IN WITNESS WHEREOF, Phoenix Color Corp. has caused this Note to be duly
executed.
PHOENIX COLOR CORP.
By:_____________________________
Xxxxx XxXxxxx
Chairman and Chief Executive Officer
Attest:_______________________
Dated:________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
CHASE MANHATTAN TRUST COMPANY, NATIONAL ASSOCIATION
as Trustee, certifies that this is one of
the Notes referred to in the Indenture.
By:______________________________
Authorized Signatory
REVERSE SIDE OF INITIAL GLOBAL NOTE
PHOENIX COLOR CORP.
GLOBAL NOTE
REPRESENTING 10-3/8% SENIOR SUBORDINATED NOTES DUE 2009
1. Indenture.
This Note is one of a duly authorized issue of debt securities of the
Issuer (as defined below) designated as its "10-3/8% Senior Subordinated Notes
due 2009" (herein called the "Notes") limited in aggregate principal amount to
$200,000,000, issued under an indenture dated as of February 2, 1999 (as amended
or supplemented from time to time, the "Indenture") among the Issuer, as issuer,
and the guarantors listed therein (collectively, the "Guarantors"), and Chase
Manhattan Trust Company, National Association, as trustee (the "Trustee," which
term includes any successor trustee under the Indenture). The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code xx.xx.
77aaa-77bbbb). The Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and such Act for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Issuer, the
Guarantors, the Trustee and each Holder and of the terms upon which the Notes
are, and are to be, authenticated and delivered. The summary of the terms of
this Note contained herein does not purport to be complete and is qualified by
reference to the Indenture. To the extent permitted by applicable law, in the
event of any inconsistency between the terms of this Note and the terms of the
Indenture, the terms of the Indenture shall control. All capitalized terms used
in this Note which are not defined herein shall have the meanings assigned to
them in the Indenture.
The Indenture restricts, among other things, the Issuer's ability to incur
additional indebtedness, pay dividends or make certain other restricted
payments, incur liens to secure pari passu or subordinated indebtedness, sell
stock of Restricted Subsidiaries, apply net proceeds from certain asset sales,
merge or consolidate with any other person, sell, assign, transfer, lease,
convey or otherwise dispose of substantially all of the assets of the Issuer,
enter into certain transactions with affiliates or incur indebtedness that is
subordinate in right of payment to any Senior Indebtedness and senior in right
of payment to the Notes. The Indenture permits, under certain circumstances,
Restricted Subsidiaries of the Issuer to be deemed Unrestricted Subsidiaries and
thus not subject to the restrictions of the Indenture.
2. Principal and Interest.
Phoenix Color Corp., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Issuer"), promises to pay the principal amount set forth on Schedule
A of this Note to the Holder hereof on February 1, 2009.
The Issuer shall pay interest at a rate of 10-3/8% per annum, from the
Issue Date or from the most recent Interest Payment Date thereafter to which
interest has been paid or duly provided
for, semiannually in arrears on February 1 and August 1 of each year, commencing
on August 1, 1999, in cash, to the Holder hereof until the principal amount
hereof is paid or made available for payment. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, subject
to certain exceptions provided in the Indenture, be paid to the Person in whose
name this Note (or the Note in exchange or substitution for which this Note was
issued) is registered at the close of business on the Record Date for interest
payable on such Interest Payment Date. The Record Date for any interest payment
is the close of business on January 15 or July 15, as the case may be, whether
or not a Business Day, immediately preceding the Interest Payment Date on which
such interest is payable. Any such interest not so punctually paid or duly
provided for ("Defaulted Interest") shall forthwith cease to be payable to the
Holder on such Record Date and shall be paid as provided in Section 2.12 of the
Indenture. Interest will be computed on the basis of a 360-day year of twelve
30-day months.
Each payment of interest in respect of an Interest Payment Date will
include interest accrued through the day before such Interest Payment Date. If
an Interest Payment Date falls on a day that is not a Business Day, the interest
payment to be made on such Interest Payment Date will be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is exchanged in a Registered Exchange Offer prior to the
Record Date for the first Interest Payment Date following such exchange, accrued
and unpaid interest, if any, on this Note, up to but not including the date of
issuance of the Exchange Note or Exchange Notes issued in exchange for this
Note, shall be paid on the first Interest Payment Date for such Exchange Note or
Exchange Notes to the Holder or Holders of such Exchange Note or Exchange Notes
on the first Record Date with respect to such Exchange Note or Exchange Notes.
If this Note is exchanged in a Registered Exchange Offer subsequent to the
Record Date for the first Interest Payment Date following such exchange but on
or prior to such Interest Payment Date, then any such accrued and unpaid
interest with respect to this Note and any accrued and unpaid interest on the
Exchange Note or Exchange Notes issued in exchange for this Note, through the
day before such Interest Payment Date, shall be paid on such Interest Payment
Date to the Holder of this Note on such Record Date.
To the extent lawful, the Issuer shall pay interest on overdue principal,
overdue premium, Defaulted Interest and overdue Liquidated Damages (without
regard to any applicable grace period) at the interest rate borne on this Note.
The Issuer's obligation pursuant to the previous sentence shall apply whether
such overdue amount is due at its maturity, as a result of the Issuer's
obligations pursuant to Section 3.05, Section 4.11 or Section 4.14 of the
Indenture, or otherwise.
3. Registration Rights, Liquidated Damages.
The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement, dated February 2, 1999, among the Issuer, the Guarantors and
the Initial Purchaser (the "Registration Rights Agreement"), which agreement is
attached to the Indenture as Exhibit J thereto. Such benefits include the right
of the Holder to receive Liquidated Damages in the event
of a failure on the part of the Issuer to comply with certain registration
covenants, as provided in Section 4 of the Registration Rights Agreement.
4. Method of Payment.
The Issuer, through the Paying Agent, shall pay interest on this Note to
the registered Holder of this Note, as provided above. The Holder must surrender
this Note to a Paying Agent to collect principal payments. The Issuer will pay
principal, premium, if any, and interest and Liquidated Damages, if any, in
money of the United States of America that at the time of payment is legal
tender for payment of all debts public and private. Principal, premium, if any,
and interest and Liquidated Damages, if any, shall be paid by check mailed to
the registered Holders at their registered addresses; provided, that all
payments with respect to Notes the Holders of which have given wire transfer
instructions to the Issuer will be required to be made by wire transfer of
immediately available funds to the accounts specified by the Holders thereof.
5. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and Registrar under the
Indenture. The Issuer may, upon written notice to the Trustee, appoint and
change any Paying Agent or Registrar. The Issuer or any of its Affiliates may
act as Paying Agent or Registrar, provided, that if the Issuer or such Affiliate
is acting as Paying Agent, the Issuer or such Affiliate shall segregate all
funds held by it as Paying Agent and hold them in trust for the benefit of the
Holders or the Trustee.
6. Guarantees.
This Note is initially entitled to the benefits of the Guarantees made by
the Guarantors listed on Annex A hereto and may thereafter be entitled to
Guarantees made by other Guarantors for the benefit of the Holders of Notes.
Each present Guarantor has, and each future Guarantor will, irrevocably and
unconditionally, jointly and severally, guarantee on a senior subordinated basis
the punctual payment when due, whether at Stated Maturity, by acceleration, in
connection with a Change of Control Offer, an Asset Sale Offer or redemption, or
otherwise, of all obligations of the Issuer under the Indenture and this Note,
whether for payment of principal of, premium, if any, interest or Liquidated
Damages, if any, on the Notes expenses, indemnification or otherwise. A
Guarantor shall be released from its Guarantee upon the terms and subject to the
conditions set forth in the Indenture.
7. Subordination.
This Note and the Guarantees are subordinated in right of payment, as set
forth in the Indenture, to the prior payment in full of all existing and future
Senior Indebtedness. Each of the Issuer and the Guarantors agrees, and each
Holder by accepting a Note agrees, to the subordination provisions set forth in
the Indenture, authorizes the Trustee to give them effect and appoints the
Trustee as attorney-in-fact for such purpose.
8. Redemption.
Except as set forth in the following paragraph, the Notes are not
redeemable at the option of the Issuer prior to February 1, 2004. Thereafter,
the Notes will be subject to redemption at the option of the Issuer, in whole or
in part, on at least 20 calendar days, but not more than 60 calendar days, prior
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest thereon, if any, and
Liquidated Damages, if any, to the applicable Redemption Date (subject to the
right of each Holder of record on the relevant Record Date to receive interest
due on the relevant Interest Payment Date), if redeemed during the twelve-month
period beginning February 1 of the years indicated below:
Year Percentage
---- ----------
2004 105.188%
2005 103.458%
2006 101.729%
2007 and thereafter 100.000%
In addition, at any time and from time to time prior to February 1, 2002
the Issuer, at its option, may redeem in the aggregate up to 25.0% of the
original principal amount of the Notes with the Net Cash 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 110.375% of
the aggregate principal amount so redeemed, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the applicable 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 75.0% of the original principal amount of the Notes must remain
outstanding after each such redemption; and provided, further, that each such
redemption shall occur within 60 days of the date of closing of the related
Public Equity Offering.
9. Notice of Redemption.
At least 30 calendar days but not more than 60 calendar days before a
Redemption Date, the Issuer shall deliver to the Trustee a notice of redemption.
At least 20 calendar days but not more than 60 calendar days before a Redemption
Date, the Issuer shall send, by first-class mail, postage prepaid, to Holders of
Notes to be redeemed at the addresses of such Holders as they appear in the Note
Register, a notice of redemption.
If fewer than all the Notes are to be redeemed at any time, the Trustee
shall select the Notes to be redeemed pro rata or by lot or by a method that
complies with applicable legal and securities exchange requirements, if any, and
that the Trustee considers 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 Notes not previously
called for redemption; provided, that the Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Notes that have denominations larger than $1,000 (Notes in denominations of
$1,000 may be redeemed only in whole). If any Note is redeemed subsequent to a
Record Date with respect to any Interest Payment Date specified above and on or
prior to such Interest Payment Date, then any accrued interest will be paid on
such Interest Payment Date to the Holder of the Note on such Record Date. If
money in an amount sufficient to pay the Redemption Price of all Notes (or
portions thereof) to be redeemed on the Redemption Date is deposited with the
Paying Agent on or before the applicable Redemption Date and certain other
conditions are satisfied, interest on the Notes or portions thereof to be
redeemed on the applicable Redemption Date will cease to accrue.
10. Repurchase at the Option of Holders upon Change of Control.
Upon the occurrence of a Change of Control, each Holder shall have the
right in accordance with the terms hereof and the Indenture to require the
Issuer to purchase such Holder's Notes, in whole or in part, in a principal
amount that is an integral multiple of $1,000, pursuant to a Change of Control
Offer, at a purchase price in cash equal to 101% of the principal amount of such
Notes (or portions thereto) plus accrued and unpaid interest and Liquidated
Damages, if any, to the Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the Issuer shall
send, or cause to be sent, by first-class mail, postage prepaid, a notice
regarding the Change of Control Offer to each Holder with a copy to the Trustee.
The Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Change of Control Offer. Unless the Issuer defaults in the payment of the
Change of Control Purchase Price with respect thereto, all Notes or portions
thereof accepted for payment pursuant to the Change of Control Offer will cease
to accrue interest from and after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing Change
of Control Offers, but in any event within 30 calendar days following a Change
of Control, the Issuer shall, to the extent required, either repay all
outstanding Senior Indebtedness or obtain the requisite consents, if any, under
all agreements governing outstanding Senior Indebtedness to permit the
repurchase of Notes required by the provisions of the Indenture governing Change
of Control Offers.
11. Repurchase at the Option of Holders upon Asset Sale.
If at any time the Issuer or any Restricted Subsidiary engages in any
Asset Sale, as a result of which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall, within 30 calendar days of the date the amount
of Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds
to make an offer to purchase from all Holders of Notes, on a pro rata basis,
Notes in an aggregate principal amount equal in amount to the then-existing
Excess Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date (subject to the right of each Holder of
record on the relevant Record Date to receive interest due on the relevant
Interest Payment Date). Upon completion of an Asset Sale Offer (including
payment of the Asset Sale Purchase Price for accepted Notes), any surplus Excess
Proceeds that were the subject of such offer shall cease to be Excess Proceeds,
and the Issuer may then use such amounts for general corporate purposes.
Within 30 calendar days of the date the amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall send, or cause to be sent, by first-class mail,
postage prepaid, a notice regarding the Asset Sale Offer to each Holder. The
Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Asset Sale Offer. Unless the Issuer defaults in the payment of the Asset
Sale Purchase Price with respect thereto, all Notes or portions thereof selected
for payment pursuant to the Asset Sale Offer will cease to accrue interest from
and after the Asset Sale Purchase Date.
12. The Global Note.
So long as this Global Note is registered in the name of the Depositary or
its nominee, members of, or participants in, the Depositary ("Agent Members")
shall have no rights under the Indenture with respect to this Global Note held
on their behalf by the Depositary or the Trustee as its custodian, and the
Depositary may be treated by the Issuer, the Guarantors, the Trustee and any
agent of the Issuer, the Guarantors or the Trustee as the absolute owner of this
Global Note for all purposes. Notwithstanding the foregoing, nothing herein
shall (i) prevent the Issuer, the Guarantors, the Trustee or any agent of the
Issuer, the Guarantors or the Trustee, from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or (ii)
impair, as between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a Holder.
The Holder of this Global Note may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests in this
Global Note through Agent Members, to take any action which a Holder is entitled
to take under the Indenture or the Notes.
Whenever, as a result of optional redemption by the Issuer, a Change of
Control Offer, an Asset Sale Offer, a Registered Exchange Offer or an exchange
for Certificated Notes, this Global Note is redeemed, repurchased or exchanged
in part, this Global Note shall be surrendered by the Holder thereof to the
Trustee who shall cause an adjustment to be made to Schedule A hereof so that
the principal amount of this Global Note will be equal to the portion not
redeemed, repurchased or exchanged and shall thereafter return this Global Note
to such Holder; provided, that this Global Note shall be in a principal amount
of $1,000 or an integral multiple of $1,000.
13. The Registered Exchange Offer.
Any Initial Notes represented by this Global Note that are presented to
the Registrar for exchange pursuant to the Registered Exchange Offer (as defined
in the Registration Rights Agreement) shall be exchanged for a Global Note
representing Exchange Notes of equal principal amount upon surrender of this
Global Note to the Registrar in accordance with the terms of the Registered
Exchange Offer and the Indenture.
14. Transfer and Exchange.
The transfer of this Note is subject to certain restrictions, including
those to which reference is made in the Private Placement Legend. A Holder may
transfer or exchange Notes as provided in the Indenture and subject to certain
limitations therein set forth. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes, fees and expenses required by law or permitted by the Indenture.
15. Denominations.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount.
16. Discharge and Defeasance.
Subject to certain conditions, the Issuer at any time may terminate some
or all of the obligations of the Issuer and the Guarantors under the Notes, the
Guarantees and the Indenture if the Issuer irrevocably deposits in trust with
the Trustee cash or U.S. Government Obligations for the payment of principal,
premium, if any, interest and Liquidated Damages, if any, on the Notes to
redemption or maturity, as the case may be.
17. Amendment, Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any past Default and its consequences or any
compliance with any provisions of the Indenture may be waived with the written
consent of the Holders of at least a majority in principal amount of the
outstanding Notes. Subject to certain exceptions set forth in the Indenture,
without the consent of any Holder, the Issuer and the Trustee may amend the
Indenture or the Notes (i) to evidence the succession of another Person to the
Issuer and the assumption by such successor of the covenants of the Issuer under
the Indenture and contained in the Notes; (ii) to add to the covenants of the
Issuer, for the benefit of the Holders of all of the Notes, or to surrender any
right or power conferred on the Issuer under the Indenture; (iii) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (iv) to
secure the Notes; (v) to cure any ambiguity, omission, defect or inconsistency
in the Indenture; (vi) to comply with the requirements of the SEC in order to
effect or maintain the qualification of the Indenture under the TIA; or (vii) to
evidence the agreement or acknowledgment of a Restricted Subsidiary that it is a
Guarantor for all purposes under the Indenture (including, without limitation,
Article 12 thereof).
18. Defaults and Remedies.
Under the Indenture, Events of Default include: (i) a default for 30 days
in the payment when due of interest on, or Liquidated Damages with respect to,
the Notes (whether or not prohibited by the subordination provisions of the
Indenture); (ii) a default in the payment when
due of the principal of or premium, if any, on the Notes (whether or not
prohibited by the subordination provisions of the Indenture); (iii) failure by
the Issuer to observe or perform certain covenants, conditions, agreements or
other provisions of the Indenture or this Note (and, in the case of certain
covenants, agreements or other provisions, such failure has continued after
written notice by the Trustee or the Holders of at least 25% in principal amount
of the Notes for a time period specified in such notice); (iv) a default in the
payment of Indebtedness of the Issuer or any of its Subsidiaries within any
applicable grace period after final maturity or acceleration of such
Indebtedness in an amount in excess of $5.0 million in the aggregate; (v)
certain events of bankruptcy or insolvency with respect to the Issuer or any of
its Subsidiaries; (vi) certain undischarged judgments in excess of $5.0 million
against the Issuer or any of its Subsidiaries; or (vii) the Guarantee of any
Guarantor ceasing for any reason to be in full force and effect (other than in
accordance with the terms of the Indenture) or any Guarantor denying or
disaffirming its obligations under its Guarantee.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the Notes being
immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power under the Indenture.
The Holders of a majority in principal amount of the then outstanding Notes, by
written notice to the Trustee and the Issuer, may rescind any declaration of
acceleration and its consequences if the rescission would not conflict with any
judgment or decree, and if all existing Events of Default have been cured or
waived, except nonpayment of principal, interest, premium or Liquidated Damages
that has become due solely because of acceleration. No such rescission shall
affect any subsequent Default or impair any right consequent thereto.
19. Individual Rights of Trustee.
Subject to certain limitations imposed by the TIA, the Trustee or any
Paying Agent or Registrar, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Issuer, the
Guarantors or their Affiliates with the same rights it would have if it were not
Trustee, Paying Agent or Registrar, as the case may be, under the Indenture.
20. No Recourse Against Certain Others.
No director, officer, employee, incorporator or stockholder of the Issuer
or any Guarantor, as such, shall have any liability for any obligations of the
Issuer or such Guarantor under the Notes, the Guarantees or the Indenture or for
any claim based on, in respect of, or by reason of, such obligations or their
creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of the Issuer or such Guarantor. By accepting a
Note, each
Holder waives and releases all such liability (but only such liability) as part
of the consideration for issuance of such Note to such Holder.
21. Authentication.
This Note shall not be valid until the Trustee or an authenticating agent
manually signs the certificate of authentication on the other side of this Note.
22. Abbreviations.
Customary abbreviations may be used in the name of a Holder 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).
23. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuer has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
24. Governing Law.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN SAID STATE.
The Issuer will furnish to any Holder upon written request and without
charge to the Holder a copy of the Indenture. Requests may be made to:
Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxxxx
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount at maturity of this Note shall be
$____________________. The following decreases/increases in the principal amount
in denominations of $ 1,000 or integral multiples thereof at maturity of this
Note have been made:
Total Principal
Amount at Notation
Decrease in Increase in Maturity Made by
Date of Principal Principal Following such or on
Decrease/ Amount at Amount at Decrease/ Behalf of
Increase Maturity Maturity Increase Trustee
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED _________________________________ hereby sells, assigns
and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
-------------------------------
-------------------------------------------------------------------------------
(Please print name and address of transferee)
--------------------------------------------------------------------------------
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Note Register, with full power of substitution.
Dated:_________________________
------------------------------------- -------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
(TM) In connection with the Change of Control Offer made pursuant to Section
4.14 of the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $______________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note repurchased by the Issuer. The undersigned
hereby directs the Trustee or Paying Agent to pay it or
___________________________ an amount in cash equal to 101% of the
principal amount indicated in the preceding sentence plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the Change of
Control Payment Date.
(TM) In connection with the Asset Sale Offer made pursuant to Section 4.11 of
the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $_______________ ($1,000 in principal amount or an integral multiple
thereof) of this Note repurchased by the Issuer. The undersigned hereby
directs the Trustee or Paying Agent to pay it or _______________________
an amount in cash equal to 100% of the principal amount indicated in the
preceding sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated:_________________
------------------------------------- -------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
ANNEX A
LIST OF GUARANTORS
EXHIBIT B
FORM OF INITIAL CERTIFICATED NOTE
FACE OF INITIAL CERTIFICATED NOTE
PHOENIX COLOR CORP.
No. _____ CUSIP No. ___________
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE
UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS
SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A)
IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE ACT)
OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 (a)(1), (2), (3)
OR (7) UNDER THE ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON
AND IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION, (2) AGREES THAT IT WILL
NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS NOTE RESELL OR
OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF,
(B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 000X XXXXX XXX XXX, (X) XXXXXX XXX XXXXXX XXXXXX TO AN ACCREDITED
INVESTOR THAT IS ACQUIRING THIS NOTE FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
SUCH AN ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF
$250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, THAT, PRIOR
TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S.
BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS NOTE (THE FORM
OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (D) OUTSIDE THE UNITED STATES
IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE ACT, (E)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE ACT
(IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION
WITH ANY TRANSFER OF THIS NOTE WITHIN TWO YEARS AFTER ORIGINAL ISSUANCE OF THIS
NOTE, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUER SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY
REASONABLY REQUIRE 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 ACT. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON"
HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE ACT.
TRANSFER OF THIS NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTION 2.07 OF THE INDENTURE, DATED AS OF FEBRUARY 2,
1999, AMONG PHOENIX COLOR CORP., AS ISSUER, THE GUARANTORS LISTED THEREIN AND
CHASE MANHATTAN TRUST COMPANY, NATIONAL ASSOCIATION, AS TRUSTEE, PURSUANT TO
WHICH THIS NOTE WAS ISSUED.
10 3/8% SENIOR SUBORDINATED NOTE DUE 2009
Phoenix Color Corp., a Delaware corporation, for value received, hereby
promises to pay to ________________, or its registered assigns, the principal
amount of _______________, on February 1, 2009.
Interest Payment Dates: February 1 and August 1, commencing August 1,
1999.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purposes.
IN WITNESS WHEREOF, Phoenix Color Corp. has caused this Note to be duly
executed.
PHOENIX COLOR CORP.
By: _____________________________
Xxxxx XxXxxxx
Chairman and Chief Executive Officer
Attest:___________________
Dated:____________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
CHASE MANHATTAN TRUST COMPANY, NATIONAL ASSOCIATION
as Trustee, certifies that this is one of
the Notes referred to in the Indenture.
By:____________________________
Authorized Signatory
REVERSE SIDE OF INITIAL CERTIFICATED NOTE
PHOENIX COLOR CORP.
10-3/8% SENIOR SUBORDINATED NOTE DUE 2009
1. Indenture.
This Note is one of a duly authorized issue of debt securities of the
Issuer (as defined below) designated as its "10-3/8% Senior Subordinated Notes
due 2009" (herein called the "Notes") limited in aggregate principal amount to
$200,000,000, issued under an indenture dated as of February 2, 1999 (as amended
or supplemented from time to time, the "Indenture") among the Issuer, as issuer,
and the guarantors listed therein (collectively, the "Guarantors"), and Chase
Manhattan Trust Company, National Association, as trustee (the "Trustee," which
term includes any successor trustee under the Indenture). The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code xx.xx.
77aaa-77bbbb). The Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and such Act for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Issuer, the
Guarantors, the Trustee and each Holder and of the terms upon which the Notes
are, and are to be, authenticated and delivered. The summary of the terms of
this Note contained herein does not purport to be complete and is qualified by
reference to the Indenture. To the extent permitted by applicable law, in the
event of any inconsistency between the terms of this Note and the terms of the
Indenture, the terms of the Indenture shall control. All capitalized terms used
in this Note which are not defined herein shall have the meanings assigned to
them in the Indenture.
The Indenture restricts, among other things, the Issuer's ability to incur
additional indebtedness, pay dividends or make certain other restricted
payments, incur liens to secure pari passu or subordinated indebtedness, sell
stock of Restricted Subsidiaries, apply net proceeds from certain asset sales,
merge or consolidate with any other person, sell, assign, transfer, lease,
convey or otherwise dispose of substantially all of the assets of the Issuer,
enter into certain transactions with affiliates or incur indebtedness that is
subordinate in right of payment to any Senior Indebtedness and senior in right
of payment to the Notes. The Indenture permits, under certain circumstances,
Restricted Subsidiaries of the Issuer to be deemed Unrestricted Subsidiaries and
thus not subject to the restrictions of the Indenture.
2. Principal and Interest.
Phoenix Color Corp., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Issuer"), promises to pay the principal amount set forth on the face
of this Note to the Holder hereof on February 1, 2009.
The Issuer shall pay interest at a rate of 10-3/8% per annum, from the
Issue Date or from the most recent Interest Payment Date thereafter to which
interest has been paid or duly provided for, semiannually in arrears on February
1 and August 1 of each year, commencing on August 1,
1999, in cash, to the Holder hereof until the principal amount hereof is paid or
made available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, subject to certain exceptions
provided in the Indenture, be paid to the Person in whose name this Note (or the
Note in exchange or substitution for which this Note was issued) is registered
at the close of business on the Record Date for interest payable on such
Interest Payment Date. The Record Date for any interest payment is the close of
business on January 15 or July 15 as the case may be, whether or not a Business
Day, immediately preceding the Interest Payment Date on which such interest is
payable. Any such interest not so punctually paid or duly provided for
("Defaulted Interest") shall forthwith cease to be payable to the Holder on such
Record Date and shall be paid as provided in Section 2.12 of the Indenture.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
Each payment of interest in respect of an Interest Payment Date will
include interest accrued through the day before such Interest Payment Date. If
an Interest Payment Date falls on a day that is not a Business Day, the interest
payment to be made on such Interest Payment Date will be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is exchanged in a Registered Exchange Offer prior to the
Record Date for the first Interest Payment Date following such exchange, accrued
and unpaid interest, if any, on this Note, up to but not including the date of
issuance of the Exchange Note or Exchange Notes issued in exchange for this
Note, shall be paid on the first Interest Payment Date for such Exchange Note or
Exchange Notes to the Holder or Holders of such Exchange Note or Exchange Notes
on the first Record Date with respect to such Exchange Note or Exchange Notes.
If this Note is exchanged in a Registered Exchange Offer subsequent to the
Record Date for the first Interest Payment Date following such exchange but on
or prior to such Interest Payment Date, then any such accrued and unpaid
interest with respect to this Note and any accrued and unpaid interest on the
Exchange Note or Exchange Notes issued in exchange for this Note, through the
day before such Interest Payment Date, shall be paid on such Interest Payment
Date to the Holder of this Note on such Record Date.
To the extent lawful, the Issuer shall pay interest on overdue principal,
overdue premium, Defaulted Interest and overdue Liquidated Damages (without
regard to any applicable grace period) at the interest rate borne on this Note.
The Issuer's obligation pursuant to the previous sentence shall apply whether
such overdue amount is due at its maturity, as a result of the Issuer's
obligations pursuant to Section 3.05, Section 4. 11 or Section 4.14 of the
Indenture, or otherwise.
3. Registration Rights; Liquidated Damages.
The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement, dated February 2, 1999, among the Issuer, the Guarantors and
the Initial Purchaser (the "Registration Rights Agreement"), which agreement is
attached to the Indenture as Exhibit J thereto. Such benefits include the right
of the Holder to receive Liquidated Damages in the event
of a failure on the part of the Issuer to comply with certain registration
covenants, as provided in Section 4 of the Registration Rights Agreement.
4. Method of Payment.
The Issuer, through the Paying Agent, shall pay interest on this Note to
the registered Holder of this Note, as provided above. The Holder must surrender
this Note to a Paying Agent to collect principal payments. The Issuer will pay
principal, premium, if any, and interest and Liquidated Damages, if any, in
money of the United States of America that at the time of payment is legal
tender for payment of all debts public and private. Principal, premium, if any,
and interest and Liquidated Damages, if any, shall be paid by check mailed to
the registered Holders at their registered addresses; provided, that all
payments with respect to Notes the Holders of which have given wire transfer
instructions to the Issuer will be required to be made by wire transfer of
immediately available funds to the accounts specified by the Holders thereof.
5. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and Registrar under the
Indenture. The Issuer may, upon written notice to the Trustee, appoint and
change any Paying Agent or Registrar. The Issuer or any of its Affiliates may
act as Paying Agent or Registrar, provided, that if the Issuer or such Affiliate
is acting as Paying Agent, the Issuer or such Affiliate shall segregate all
funds held by it as Paying Agent and hold them in trust for the benefit of the
Holders or the Trustee.
6. Guarantees.
This Note is initially entitled to the benefits of the Guarantees made by
the Guarantors listed on Annex A hereto and may thereafter be entitled to
Guarantees made by other Guarantors for the benefit of the Holders of Notes.
Each present Guarantor has, and each future Guarantor will, irrevocably and
unconditionally, jointly and severally, guarantee on a senior subordinated basis
the punctual payment when due, whether at Stated Maturity, by acceleration, in
connection with a Change of Control Offer, an Asset Sale Offer or redemption, or
otherwise, of all obligations of the Issuer under the Indenture and this Note,
whether for payment of principal of, premium, if any, interest or Liquidated
Damages, if any, on the Notes, expenses, indemnification or otherwise. A
Guarantor shall be released from its Guarantee upon the terms and subject to the
conditions set forth in the Indenture.
7. Subordination.
This Note and the Guarantees are subordinated in right of payment, as set
forth in the Indenture, to the prior payment in full of all existing and future
Senior Indebtedness. Each of the Issuer and the Guarantors agrees, and each
Holder by accepting a Note agrees, to the subordination provisions set forth in
the Indenture, authorizes the Trustee to give them effect and appoints the
Trustee as attorney-in-fact for such purpose.
8. Redemption.
Except as set forth in the following paragraph, the Notes are not
redeemable at the option of the Issuer prior to February 1, 2004. Thereafter,
the Notes will be subject to redemption at the option of the Issuer, in whole or
in part, on at least 20 calendar days, but not more than 60 calendar days, prior
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest thereon, if any, and
Liquidated Damages, if any, to the applicable Redemption Date (subject to the
right of each Holder of record on the relevant Record Date to receive interest
due on the relevant Interest Payment Date), if redeemed during the twelve-month
period beginning February 1 of the years indicated below:
Year Percentage
---- ----------
2004 105.188%
2005 103.458%
2006 101.729%
2007 and thereafter 100.000%
In addition, at any time and from time to time prior to February 1, 2002,
the Issuer, at its option, may redeem in the aggregate up to 25.0% of the
original principal amount of the Notes with the Net Cash 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 110.375% of
the aggregate principal amount so redeemed, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the applicable 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 75.0% of the original principal amount of the Notes must remain
outstanding after each such redemption; and provided, further, that each such
redemption shall occur within 60 days of the date of closing of the related
Public Equity Offering.
9. Notice of Redemption.
At least 30 calendar days but not more than 60 calendar days before a
Redemption Date, the Issuer shall deliver to the Trustee a notice of redemption.
At least 20 calendar days but not more than 60 calendar days before a Redemption
Date, the Issuer shall send, by first-class mail, postage prepaid, to Holders of
Notes to be redeemed at the addresses of such Holders as they appear in the Note
Register, a notice of redemption. If fewer than all the Notes are to be redeemed
at any time, the Trustee shall select the Notes to be redeemed pro rata or by
lot or by a method that complies with applicable legal and securities exchange
requirements, if any, and that the Trustee considers 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
Notes not previously called for redemption; provided, that the Trustee may
select for redemption portions (equal to $1,000 or any integral multiple
thereof) of the principal of Notes that have denominations larger than $1,000
(Notes in denominations of $1,000 may be redeemed only in whole). If any Note is
redeemed subsequent to a Record Date with respect to any Interest Payment Date
specified above and on or prior to such Interest Payment Date, then any accrued
interest will be paid on such Interest Payment Date to the Holder of the Note on
such Record Date. If money in an amount sufficient to pay the Redemption Price
of all Notes (or portions thereof) to be redeemed on the Redemption Date is
deposited with the Paying Agent on or before the applicable Redemption Date and
certain other conditions are satisfied, interest on the Notes or portions
thereof to be redeemed on the applicable Redemption Date will cease to accrue.
10. Repurchase at the Option of Holders upon Change of Control.
Upon the occurrence of a Change of Control, each Holder shall have the
right in accordance with the terms hereof and the Indenture to require the
Issuer to purchase such Holder's Notes, in whole or in part, in a principal
amount that is an integral multiple of $ 1,000, pursuant to a Change of Control
Offer, at a purchase price in cash equal to 101% of the principal amount of such
Notes (or portions thereof) plus accrued and unpaid interest and Liquidated
Damages, if any, to the Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the Issuer shall
send, or cause to be sent, by first-class mail, postage prepaid, a notice
regarding the Change of Control Offer to each Holder with a copy to the Trustee.
The Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Change of Control Offer. Unless the Issuer defaults in the payment of the
Change of Control Purchase Price with respect thereto, all Notes or portions
thereof accepted for payment pursuant to the Change of Control Offer will cease
to accrue interest from and after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing Change
of Control Offers, but in any event within 30 calendar days following a Change
of Control, the Issuer shall, to the extent required, either repay all
outstanding Senior Indebtedness or obtain the requisite consents, if any, under
all agreements governing outstanding Senior Indebtedness to permit the
repurchase of Notes required by the provisions of the Indenture governing Change
of Control Offers.
11. Repurchase at the Option of Holders upon Asset Sale.
If at any time the Issuer or any Restricted Subsidiary engages in any
Asset Sale, as a result of which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall, within 30 calendar days of the date the amount
of Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds
to make an offer to purchase from all Holders of Notes, on a pro rata basis,
Notes in an aggregate principal amount equal in amount to the then-existing
Excess Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date (subject to the right of each Holder of
record on the relevant Record Date to receive interest due on the relevant
Interest Payment Date). Upon completion of an Asset Sale Offer (including
payment of the Asset Sale Purchase Price for accepted Notes), any surplus Excess
Proceeds that were the subject of such offer shall cease to be Excess Proceeds,
and the Issuer may then use such amounts for general corporate purposes.
Within 30 calendar days of the date the amount of Excess Proceeds exceeds $5.0
million, the Issuer shall send, or cause to be sent, by first-class mail,
postage prepaid, a notice regarding the Asset Sale Offer to each Holder. The
Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Asset Sale Offer. Unless the Issuer defaults in the payment of the Asset
Sale Purchase Price with respect thereto, all Notes or portions thereof selected
for payment pursuant to the Asset Sale Offer will cease to accrue interest from
and after the Asset Sale Purchase Date.
12. The Registered Exchange Offer.
Any Initial Notes (including this Note) that are presented to the
Registrar for exchange pursuant to the Registered Exchange Offer (as defined in
the Registration Rights Agreement) shall be exchanged for Exchange Notes of
equal principal amount upon surrender of such Notes to the Registrar in
accordance with the terms of the Registered Exchange Offer and the Indenture.
13. Transfer and Exchange.
The transfer of this Note is subject to certain restrictions, including
those to which reference is made in the Private Placement Legend. A Holder may
transfer or exchange Notes as provided in the Indenture and subject to certain
limitations therein set forth. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes, fees and expenses required by law or permitted by the Indenture. The
Registrar need not register the transfer or exchange of Certificated Notes or
portions thereof selected for redemption (except, in the case of a Certificated
Note to be redeemed in part, the portion of such Certificated Note not to be
redeemed) or any Certificated Notes for a period of 15 calendar days before a
selection of Notes to be redeemed.
14. Denominations.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount;
provided, that Initial Certificated Notes originally purchased by or transferred
to Institutional Accredited Investors shall be subject to a minimum denomination
of $250,000.
15. Discharge and Defeasance.
Subject to certain conditions, the Issuer at any time may terminate some
or all of the obligations of the Issuer and the Guarantors under the Notes, the
Guarantees and the Indenture if the Issuer irrevocably deposits in trust with
the Trustee cash or U.S. Government Obligations for the payment of principal,
premium, if any, interest and Liquidated Damages, if any, on the Notes to
redemption or maturity, as the case may be.
16. Amendment, Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any past Default and its consequences or any
compliance with any provisions of the Indenture may be waived with the written
consent of the Holders of at least a majority in principal amount of the
outstanding Notes. Subject to certain exceptions set forth in the Indenture,
without the consent of any Holder, the Issuer and the Trustee may amend the
Indenture or the Notes (i) to evidence the succession of another Person to the
Issuer and the assumption by such successor of the covenants of the Issuer under
the Indenture and contained in the Notes; (ii) to add to the covenants of the
Issuer, for the benefit of the Holders of all of the Notes, or to surrender any
right or power conferred on the Issuer under the Indenture; (iii) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (iv) to
secure the Notes; (v) to cure any ambiguity, omission, defect or inconsistency
in the Indenture; (vi) to comply with the requirements of the SEC in order to
effect or maintain the qualification of the Indenture under the TIA; or (vii) to
evidence the agreement or acknowledgment of a Restricted Subsidiary that it is a
Guarantor for all purposes under the Indenture (including, without limitation,
Article 12 thereof).
17. Defaults and Remedies.
Under the Indenture, Events of Default include: (i) a default for 30 days
in the payment when due of interest on, or Liquidated Damages with respect to,
the Notes (whether or not prohibited by the subordination provisions of the
Indenture); (ii) a default in the payment when due of the principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of the Indenture); (iii) failure by the Issuer to observe or perform
certain covenants, conditions, agreements or other provisions of the Indenture
or this Note (and, in the case of certain covenants, agreements or other
provisions, such failure has continued after written notice by the Trustee or
the Holders of at least 25% in principal amount of the Notes for a time period
specified in such notice); (iv) a default in the payment of Indebtedness of the
Issuer or any of its Subsidiaries within any applicable grace period after final
maturity or acceleration of such Indebtedness in an amount in excess of $5.0
million in the aggregate; (v) certain events of bankruptcy or insolvency with
respect to the Issuer or any of its Subsidiaries; (vi) certain undischarged
judgments in excess of $5.0 million against the Issuer or any of its
Subsidiaries; or (vii) the Guarantee of any Guarantor ceasing for any reason to
be in full force and effect (other than in accordance with the terms of the
Indenture) or any Guarantor denying or disaffirming its obligations under its
Guarantee.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the Notes being
immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power under the Indenture.
The Holders of a majority in principal amount of the then outstanding Notes, by
written notice to the Trustee and the Issuer, may rescind any declaration of
acceleration and its consequences if the rescission would not conflict with any
judgment or decree, and if all existing Events of Default have been cured or
waived, except nonpayment of principal, interest, premium or Liquidated Damages
that has become due solely because of acceleration. No such rescission shall
affect any subsequent Default or impair any right consequent thereto.
18. Individual Rights of Trustee.
Subject to certain limitations imposed by the TIA, the Trustee or any
Paying Agent or Registrar, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Issuer, the
Guarantors or their Affiliates with the same rights it would have if it were not
Trustee, Paying Agent or Registrar, as the case may be, under the Indenture.
19. No Recourse Against Certain Others.
No director, officer, employee, incorporator or stockholder of the Issuer
or any Guarantor, as such, shall have any liability for any obligations of the
Issuer or such Guarantor under the Notes, the Guarantees or the Indenture or for
any claim based on, in respect of, or by reason of, such obligations or their
creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of the Issuer or such Guarantor. By accepting a
Note, each Holder waives and releases all such liability (but only such
liability) as part of the consideration for issuance of such Note to such
Holder.
20. Authentication.
This Note shall not be valid until the Trustee or an authenticating agent
manually signs the certificate of authentication on the other side of this Note.
21. Abbreviations.
Customary abbreviations may be used in the name of a Holder 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 Issuer has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to
Holders of Notes. No representation is made as to the accuracy of such numbers
either as printed on the Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.
23. Governing Law.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN SAID STATE.
The Issuer will furnish to any Holder upon written request and without
charge to the Holder a copy of the Indenture. Requests may be made to:
Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxxxx
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED _________________________________ hereby sells, assigns
and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
-------------------------------
-------------------------------------------------------------------------------
(Please print name and address of transferee)
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Note Register, with full power of substitution.
Dated:_________________________
------------------------------------- -------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
(TM) In connection with the Change of Control Offer made pursuant to Section
4.14 of the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $______________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note repurchased by the Issuer. The undersigned
hereby directs the Trustee or Paying Agent to pay it or
___________________________ an amount in cash equal to 101% of the
principal amount indicated in the preceding sentence plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the Change of
Control Payment Date.
(TM) In connection with the Asset Sale Offer made pursuant to Section 4.11 of
the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $_______________ ($1,000 in principal amount or an integral multiple
thereof) of this Note repurchased by the Issuer. The undersigned hereby
directs the Trustee or Paying Agent to pay it or _______________________
an amount in cash equal to 100% of the principal amount indicated in the
preceding sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated:____________________
------------------------------------- -------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
ANNEX A
LIST OF GUARANTORS
EXHIBIT C
FORM OF EXCHANGE GLOBAL NOTE
FACE OF EXCHANGE GLOBAL NOTE
PHOENIX COLOR CORP.
No. ____ CUSIP No._________________
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO PHOENIX COLOR CORP. OR A SUCCESSOR THEREOF OR THE REGISTRAR FOR
REGISTRATION OF TRANSFER OR EXCHANGE AND ANY NOTE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS HAS BEEN REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFER OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, AND NOT IN
PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE.
GLOBAL NOTE
REPRESENTING 10-3/8% SENIOR SUBORDINATED NOTES DUE 2009
Phoenix Color Corp., a Delaware corporation, for value received, hereby
promises to pay to Cede & Co., or its registered assigns, the principal sum
indicated on Schedule A hereof, on February 1, 2009.
Interest Payment Dates: February 1 and August 1, commencing August 1,
1999.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purposes.
IN WITNESS WHEREOF, Phoenix Color Corp. has caused this Note to be duly
executed.
PHOENIX COLOR CORP.
By:______________________________
Xxxxx XxXxxxx
Chairman and Chief Executive Officer
Attest:___________________
Dated:____________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
CHASE MANHATTAN TRUST COMPANY, NATIONAL ASSOCIATION
, as Trustee, certifies that this is one of
the Notes referred to in the Indenture.
By:_____________________________
Authorized Signatory
REVERSE SIDE OF EXCHANGE GLOBAL NOTE
PHOENIX COLOR CORP.
GLOBAL NOTE
REPRESENTING 10-3/8% SENIOR SUBORDINATED NOTES DUE 2009
1. Indenture.
This Note is one of a duly authorized issue of debt securities of the
Issuer (as defined below) designated as its "10-3/8% Senior Subordinated Notes
due 2009" (herein called the "Notes") limited in aggregate principal amount to
$200,000,000, issued under an indenture dated as of February 2, 1999 (as amended
or supplemented from time to time, the "Indenture") among the Issuer, as issuer,
and the guarantors listed therein (collectively, the "Guarantors"), and Chase
Manhattan Trust Company, National Association, as trustee (the "Trustee," which
term includes any successor trustee under the Indenture). The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code xx.xx.
77aaa-77bbbb). The Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and such Act for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Issuer, the
Guarantors, the Trustee and each Holder and of the terms upon which the Notes
are, and are to be, authenticated and delivered. The summary of the terms of
this Note contained herein does not purport to be complete and is qualified by
reference to the Indenture. To the extent permitted by applicable law, in the
event of any inconsistency between the terms of this Note and the terms of the
Indenture, the terms of the Indenture shall control. All capitalized terms used
in this Note which are not defined herein shall have the meanings assigned to
them in the Indenture.
The Indenture restricts, among other things, the Issuer's ability to incur
additional indebtedness, pay dividends or make certain other restricted
payments, incur liens to secure pari passu or subordinated indebtedness, sell
stock of Restricted Subsidiaries, apply net proceeds from certain asset sales,
merge or consolidate with any other person, sell, assign, transfer, lease,
convey or otherwise dispose of substantially all of the assets of the Issuer,
enter into certain transactions with affiliates or incur indebtedness that is
subordinate in right of payment to any Senior Indebtedness and senior in right
of payment to the Notes. The Indenture permits, under certain circumstances,
Restricted Subsidiaries of the Issuer to be deemed Unrestricted Subsidiaries and
thus not subject to the restrictions of the Indenture.
2. Principal and Interest.
Phoenix Color Corp., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Issuer"), promises to pay the principal amount set forth on Schedule
A of this Note to the Holder hereof on February 1, 2009.
The Issuer shall pay interest at a rate of 10-3/8% per annum, from the
Issue Date or from the most recent Interest Payment Date thereafter to which
interest has been paid or duly provided
for, semiannually in arrears on February 1 and August 1 of each year, commencing
on August 1, 1999, in cash, to the Holder hereof until the principal amount
hereof is paid or made available for payment. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, subject
to certain exceptions provided in the Indenture, be paid to the Person in whose
name this Note (or the Note in exchange or substitution for which this Note was
issued) is registered at the close of business on the Record Date for interest
payable on such Interest Payment Date. The Record Date for any interest payment
is the close of business on January 15 or July 15, as the case may be, whether
or not a Business Day, immediately preceding the Interest Payment Date on which
such interest is payable. Any such interest not so punctually paid or duly
provided for ("Defaulted Interest") shall forthwith cease to be payable to the
Holder on such Record Date and shall be paid as provided in Section 2.12 of the
Indenture. Interest will be computed on the basis of a 360-day year of twelve
30-day months.
Each payment of interest in respect of an Interest Payment Date will
include interest accrued through the day before such Interest Payment Date. If
an Interest Payment Date falls on a day that is not a Business Day, the interest
payment to be made on such Interest Payment Date will be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is issued pursuant to a Registered Exchange Offer on or prior
to the Record Date for the first Interest Payment Date following such exchange,
accrued and unpaid interest, if any, on the equivalent principal amount of the
Initial Note in exchange for which this Note was issued, up to but not including
the date of issuance of this Note, shall be paid on the first Interest Payment
Date for this Note to the Holder of this Note on the first Record Date with
respect to this Note. If this Note is issued pursuant to a Registered Exchange
Offer subsequent to the Record Date for the first Interest Payment Date
following such exchange but on or prior to such Interest Payment Date, then any
such accrued and unpaid interest with respect to the equivalent principal amount
of the Initial Note in exchange for which this Note was issued and any accrued
and unpaid interest on this Note, through the day before such Interest Payment
Date, shall be paid on such Interest Payment Date to the Holder of such Initial
Note on such Record Date.
To the extent lawful, the Issuer shall pay interest on overdue principal,
overdue premium, Defaulted Interest and overdue Liquidated Damages (without
regard to any applicable grace period) at the interest rate borne on this Note.
The Issuer's obligation pursuant to the previous sentence shall apply whether
such overdue amount is due at its maturity, as a result of the Issuer's
obligations pursuant to Section 3.05, Section 4.11 or Section 4.14 of the
Indenture, or otherwise.
3. Method of Payment.
The Issuer, through the Paying Agent, shall pay interest on this Note to
the registered Holder of this Note, as provided above. The Holder must surrender
this Note to a Paying Agent to collect principal payments. The Issuer will pay
principal, premium, if any, and interest and Liquidated Damages, if any,
in money of the United States of America that at the time of payment is legal
tender for payment of all debts public and private. Principal, premium, if any,
and interest and Liquidated Damages, if any, shall be paid by check mailed to
the registered Holders at their registered addresses; provided, that all
payments with respect to Notes the Holders of which have given wire transfer
instructions to the Issuer will be required to be made by wire transfer of
immediately available funds to the accounts specified by the Holders thereof.
4. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and Registrar under the
Indenture. The Issuer may, upon written notice to the Trustee, appoint and
change any Paying Agent or Registrar. The Issuer or any of its Affiliates may
act as Paying Agent or Registrar, provided , that if the Issuer or such
Affiliate is acting as Paying Agent, the Issuer or such Affiliate shall
segregate all funds held by it as Paying Agent and hold them in trust for the
benefit of the Holders or the Trustee.
5. Guarantees.
This Note is initially entitled to the benefits of the Guarantees made by
the Guarantors listed on Annex A hereto and may thereafter be entitled to
Guarantees made by other Guarantors for the benefit of the Holders of Notes.
Each present Guarantor has, and each future Guarantor will, irrevocably and
unconditionally, jointly and severally, guarantee on a senior subordinated basis
the punctual payment when due, whether at Stated Maturity, by acceleration, in
connection with a Change of Control Offer, an Asset Sale Offer or redemption, or
otherwise, of all obligations of the Issuer under the Indenture and this Note,
whether for payment of principal of, premium, if any, interest or Liquidated
Damages, if any, on the Notes, expenses, indemnification or otherwise. A
Guarantor shall be released from its Guarantee upon the terms and subject to the
conditions set forth in the Indenture.
6. Subordination.
This Note and the Guarantees are subordinated in right of payment, as set
forth in the Indenture, to the prior payment in full of all existing and future
Senior Indebtedness. Each of the Issuer and the Guarantors agrees, and each
Holder by accepting a Note agrees, to the subordination provisions set forth in
the Indenture, authorizes the Trustee to give them effect and appoints the
Trustee as attorney-in-fact for such purpose.
7. Redemption.
Except as set forth in the following paragraph, the Notes are not
redeemable at the option of the Issuer prior to February 1, 2004. Thereafter,
the Notes will be subject to redemption at the option of the Issuer, in whole or
in part, on at least 20 calendar days, but not more than 60 calendar days, prior
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest thereon, if any, and
Liquidated Damages, if any, to the applicable Redemption Date (subject to the
right of each Holder of record on the relevant Record Date to receive interest
due on the relevant Interest Payment Date), if redeemed during the twelve-month
period beginning February 1 of the years indicated below:
Year Percentage
---- ----------
2004 105.188%
2005 103.458%
2006 101.729%
2007 and thereafter 100.000%
In addition, at any time and from time to time prior to February 1, 2002
the Issuer, at its option, may redeem in the aggregate up to 25. 0% of the
original principal amount of the Notes with the Net Cash 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 110.375% of
the aggregate principal amount so redeemed, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the applicable 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 75.0% of the original principal amount of the Notes must remain
outstanding after each such redemption; and provided, further, that each such
redemption shall occur within 60 days of the date of closing of the related
Public Equity Offering.
8. Notice of Redemption.
At least 30 calendar days but not more than 60 calendar days before a
Redemption Date, the Issuer shall deliver to the Trustee a notice of redemption.
At least 20 calendar days but not more than 60 calendar days before a Redemption
Date, the Issuer shall send, by first-class mail, postage prepaid, to Holders of
Notes to be redeemed at the addresses of such Holders as they appear in the Note
Register, a notice of redemption.
If fewer than all the Notes are to be redeemed at any time, the Trustee
shall select the Notes to be redeemed pro rata or by lot or by a method that
complies with applicable legal and securities exchange requirements, if any, and
that the Trustee considers 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 Notes not previously
called for redemption; provided, that the Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Notes that have denominations larger than $1,000 (Notes in denominations of
$1,000 may be redeemed only in whole). If any Note is redeemed subsequent to a
Record Date with respect to any Interest Payment Date specified above and on or
prior to such Interest Payment Date, then any accrued interest will be paid on
such Interest Payment Date to the Holder of the Note on such Record Date. If
money in an amount sufficient to pay the Redemption Price of all Notes (or
portions thereof) to be redeemed on the Redemption Date is deposited with the
Paying Agent on or before the applicable Redemption Date and certain other
conditions are satisfied, interest on the Notes or portions thereof to be
redeemed on the applicable Redemption Date will cease to accrue.
9. Repurchase at the Option of Holders upon Change of Control.
Upon the occurrence of a Change of Control, each Holder shall have the
right in accordance with the terms hereof and the Indenture to require the
Issuer to purchase such Holder's Notes, in whole or in part, in a principal
amount that is an integral multiple of $1,000, pursuant to a Change of Control
Offer, at a purchase price in cash equal to 101% of the principal amount of such
Notes (or portions thereof) plus accrued and unpaid interest and Liquidated
Damages, if any, to the Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the Issuer shall
send, or cause to be sent, by first-class mail, postage prepaid, a notice
regarding the Change of Control Offer to each Holder with a copy to the Trustee.
The Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Change of Control Offer. Unless the Issuer defaults in the payment of the
Change of Control Purchase Price with respect thereto, all Notes or portions
thereof accepted for payment pursuant to the Change of Control Offer will cease
to accrue interest from and after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing Change
of Control Offers, but in any event within 30 calendar days following a Change
of Control, the Issuer shall, to the extent required, either repay all
outstanding Senior Indebtedness or obtain the requisite consents, if any, under
all agreements governing outstanding Senior Indebtedness to permit the
repurchase of Notes required by the provisions of the Indenture governing Change
of Control Offers.
10. Repurchase at the Option of Holders upon Asset Sale.
If at any time the Issuer or any Restricted Subsidiary engages in any
Asset Sale, as a result of which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall, within 30 calendar days of the date the amount
of Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds
to make an offer to purchase from all Holders of Notes, on a pro rata basis,
Notes in an aggregate principal amount equal in amount to the then-existing
Excess Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date (subject to the right of each Holder of
record on the relevant Record Date to receive interest due on the relevant
Interest Payment Date). Upon completion of an Asset Sale Offer (including
payment of the Asset Sale Purchase Price for accepted Notes), any surplus Excess
Proceeds that were the subject of such offer shall cease to be Excess Proceeds,
and the Issuer may then use such amounts for general corporate purposes.
Within 30 calendar days of the date the amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall send, or cause to be sent, by first-class mail,
postage prepaid, a notice regarding the Asset Sale Offer to each Holder. The
Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Asset Sale
Offer. Unless the Issuer defaults in the payment of the Asset Sale Purchase
Price with respect thereto, all Notes, or portions thereof selected for payment
pursuant to the Asset Sale Offer will cease to accrue interest from and after
the Asset Sale Purchase Date.
11. The Global Note.
So long as this Global Note is registered in the name of the Depositary or
its nominee, members of, or participants in, the Depositary ("Agent Members")
shall have no rights under the Indenture with respect to this Global Note held
on their behalf by the Depositary or the Trustee as its custodian, and the
Depositary may be treated by the Issuer, the Guarantors, the Trustee and any
agent of the Issuer, the Guarantors or the Trustee as the absolute owner of this
Global Note for all purposes. Notwithstanding the foregoing, nothing herein
shall (i) prevent the Issuer, the Guarantors, the Trustee or any agent of the
Issuer, the Guarantors or the Trustee, from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or (ii)
impair, as between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a Holder.
The Holder of this Global Note may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests in this
Global Note through Agent Members, to take any action which a Holder is entitled
to take under the Indenture or the Notes.
Whenever, as a result of optional redemption by the Issuer, a Change of
Control Offer, an Asset Sale Offer, a Registered Exchange Offer or an exchange
for Certificated Notes, this Global Note is redeemed, repurchased or exchanged
in part, this Global Note shall be surrendered by the Holder thereof to the
Trustee who shall cause an adjustment to be made to Schedule A hereof so that
the principal amount of this Global Note will be equal to the portion not
redeemed, repurchased or exchanged and shall thereafter return this Global Note
to such Holder; provided, that this Global Note shall be in a principal amount
of $1,000 or an integral multiple of $1,000.
12. Transfer and Exchange.
A Holder may transfer or exchange Notes as provided in the Indenture and
subject to certain limitations therein set forth. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes, fees and expenses required by law or permitted
by the Indenture.
13. Denominations.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount.
14. Discharge and Defeasance.
Subject to certain conditions, the Issuer at any time may terminate some
or all of the obligations of the Issuer and the Guarantors under the Notes, the
Guarantees and the Indenture if the Issuer irrevocably deposits in trust with
the Trustee cash or U.S. Government Obligations for
the payment of principal, premium, if any, interest and Liquidated Damages, if
any, on the Notes to redemption or maturity, as the case may be.
15. Amendment, Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any past Default and its consequences or any
compliance with any provisions of the Indenture may be waived with the written
consent of the Holders of at least a majority in principal amount of the
outstanding Notes. Subject to certain exceptions set forth in the Indenture,
without the consent of any Holder, the Issuer and the Trustee may amend the
Indenture or the Notes (i) to evidence the succession of another Person to the
Issuer and the assumption by such successor of the covenants of the Issuer under
the Indenture and contained in the Notes; (ii) to add to the covenants of the
Issuer, for the benefit of the Holders of all of the Notes, or to surrender any
right or power conferred on the Issuer under the Indenture; (iii) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (iv) to
secure the Notes; (v) to cure any ambiguity, omission, defect or inconsistency
in the Indenture; (vi) to comply with the requirements of the SEC in order to
effect or maintain the qualification of the Indenture under the TIA; or (vii) to
evidence the agreement or acknowledgment of a Restricted Subsidiary that it is a
Guarantor for all purposes under the Indenture (including, without limitation,
Article 12 thereof).
16. Defaults and Remedies.
Under the Indenture, Events of Default include: (i) a default for 30 days
in the payment when due of interest on, or Liquidated Damages with respect to,
the Notes (whether or not prohibited by the subordination provisions of the
Indenture); (ii) a default in the payment when due of the principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of the Indenture); (iii) failure by the Issuer to observe or perform
certain covenants, conditions, agreements or other provisions of the Indenture
or this Note (and, in the case of certain covenants, agreements or other
provisions, such failure has continued after written notice by the Trustee or
the Holders of at least 25% in principal amount of the Notes for a time period
specified in such notice); (iv) a default in the payment of Indebtedness of the
Issuer or any of its Subsidiaries within any applicable grace period after final
maturity or acceleration of such Indebtedness in an amount in excess of $5.0
million in the aggregate; (v) certain events of bankruptcy or insolvency with
respect to the Issuer or any of its Subsidiaries; (vi) certain undischarged
judgments in excess of $5.0 million against the Issuer or any of its
Subsidiaries; or (vii) the Guarantee of any Guarantor ceasing for any reason to
be in full force and effect (other than in accordance with the terms of the
Indenture) or any Guarantor denying or disaffirming its obligations under its
Guarantee.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the
Notes being immediately due and payable upon the occurrence of such Events of
Default without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power under the Indenture.
The Holders of a majority in principal amount of the then outstanding Notes, by
written notice to the Trustee and the Issuer, may rescind any declaration of
acceleration and its consequences if the rescission would not conflict with any
judgment or decree, and if all existing Events of Default have been cured or
waived, except nonpayment of principal, interest, premium or Liquidated Damages
that has become due solely because of acceleration. No such rescission shall
affect any subsequent Default or impair any right consequent thereto.
17. Individual Rights of Trustee.
Subject to certain limitations imposed by the TIA, the Trustee or any
Paying Agent or Registrar, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Issuer, the
Guarantors or their Affiliates with the same rights it would have if it were not
Trustee, Paying Agent or Registrar, as the case may be, under the Indenture.
18. No Recourse Against Certain Others.
No director, officer, employee, incorporator or stockholder of the Issuer
or any Guarantor, as such, shall have any liability for any obligations of the
Issuer or such Guarantor under the Notes, the Guarantees or the Indenture or for
any claim based on, in respect of, or by reason of, such obligations or their
creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of the Issuer or such Guarantor. By accepting a
Note, each Holder waives and releases all such liability (but only such
liability) as part of the consideration for issuance of such Note to such
Holder.
19. Authentication.
This Note shall not be valid until the Trustee or an authenticating agent
signs the certificate of authentication on the other side of this Note.
20. Abbreviations.
Customary abbreviations may be used in the name of a Holder 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 Issuer has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
22. Governing Law.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN SAID STATE.
The Issuer will furnish to any Holder upon written request and without
charge to the Holder a copy of the Indenture. Requests may be made to:
Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount at maturity of this Note shall be
$____________________. The following decreases/increases in the principal amount
in denominations of $ 1,000 or integral multiples thereof at maturity of this
Note have been made:
Total Principal
Amount at Notation
Decrease in Increase in Maturity Made by
Date of Principal Principal Following such or on
Decrease/ Amount at Amount at Decrease/ Behalf of
Increase Maturity Maturity Increase Trustee
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
-------- -------- -------- -------- -------
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED _________________________________ hereby sells, assigns
and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
-------------------------------
-------------------------------------------------------------------------------
(Please print name and address of transferee)
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Note Register, with full power of substitution.
Dated:_________________________
----------------------------------- --------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
(TM) In connection with the Change of Control Offer made pursuant to Section
4.14 of the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $______________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note repurchased by the Issuer. The undersigned
hereby directs the Trustee or Paying Agent to pay it or
___________________________ an amount in cash equal to 101% of the
principal amount indicated in the preceding sentence plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the Change of
Control Payment Date.
(TM) In connection with the Asset Sale Offer made pursuant to Section 4.11 of
the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $_______________ ($1,000 in principal amount or an integral multiple
thereof) of this Note repurchased by the Issuer. The undersigned hereby
directs the Trustee or Paying Agent to pay it or _______________________
an amount in cash equal to 100% of the principal amount indicated in the
preceding sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated:___________________
----------------------------------- --------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
ANNEX A
LIST OF GUARANTORS
EXHIBIT D
FORM OF EXCHANGE CERTIFICATED NOTE
FACE OF EXCHANGE CERTIFICATED NOTE
PHOENIX COLOR CORP.
No. _____ CUSIP No._____________
10-3/8% SENIOR SUBORDINATED NOTE DUE 2009
Phoenix Color Corp., a Delaware corporation, for value received, hereby
promises to pay to ______________________, or its registered assigns, the
principal amount of _____________ on February 1, 2009.
Interest Payment Dates: February 1 and August 1, commencing August 1,
1999.
Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been duly executed by
the Trustee referred to on the reverse hereof by manual signature, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purposes.
IN WITNESS WHEREOF, Phoenix Color Corp. has caused this Note to be duly
executed.
PHOENIX COLOR CORP.
By:_____________________________________
Xxxxx XxXxxxx
Chairman and chief Executive Officer
Attest:_________________________
Dated:__________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
CHASE MANHATTAN TRUST COMPANY, NATIONAL ASSOCIATION
as Trustee, certifies that this is one of
the Notes referred to in the Indenture.
By:_____________________________
Authorized Signatory
REVERSE SIDE OF EXCHANGE CERTIFICATED NOTE
PHOENIX COLOR CORP.
10-3/8% SENIOR SUBORDINATED NOTE DUE 2009
1. Indenture.
This Note is one of a duly authorized issue of debt securities of the
Issuer (as defined below) designated as its "10-3/8% Senior Subordinated Notes
due 2009" (herein called the "Notes") limited in aggregate principal amount to
$200,000,000, issued under an indenture dated as of February 2, 1999 (as amended
or supplemented from time to time, the "Indenture") among the Issuer, as issuer,
and the guarantors listed therein (collectively, the "Guarantors"), and Chase
Manhattan Trust Company, National Association, as trustee (the "Trustee," which
term includes any successor trustee under the Indenture). The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code xx.xx.
77aaa-77bbbb). The Notes are subject to all such terms, and Holders of Notes are
referred to the Indenture and such Act for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Issuer, the
Guarantors, the Trustee and each Holder and of the terms upon which the Notes
are, and are to be, authenticated and delivered. The summary of the terms of
this Note contained herein does not purport to be complete and is qualified by
reference to the Indenture. To the extent permitted by applicable law, in the
event of any inconsistency between the terms of this Note and the terms of the
Indenture, the terms of the Indenture shall control. All capitalized terms used
in this Note which are not defined herein shall have the meanings assigned to
them in the Indenture.
The Indenture restricts, among other things, the Issuer's ability to incur
additional indebtedness, pay dividends or make certain other restricted
payments, incur liens to secure pari passu or subordinated indebtedness, sell
stock of Restricted Subsidiaries, apply net proceeds from certain asset sales,
merge or consolidate with any other person, sell, assign, transfer, lease,
convey or otherwise dispose of substantially all of the assets of the Issuer,
enter into certain transactions with affiliates or incur indebtedness that is
subordinate in right of payment to any Senior Indebtedness and senior in right
of payment to the Notes. The Indenture permits, under certain circumstances,
Restricted Subsidiaries of the Issuer to be deemed Unrestricted Subsidiaries and
thus not subject to the restrictions of the Indenture.
2. Principal and Interest.
Phoenix Color Corp., a Delaware corporation (such corporation, and its
successors and assigns under the Indenture hereinafter referred to, being herein
called the "Issuer"), promises to pay the principal amount set forth on the face
of this Note to the Holder hereof on February 1, 2009.
The Issuer shall pay interest at a rate of 10-3/8% per annum, from the
Issue Date or from the most recent Interest Payment Date thereafter to which
interest has been paid or duly provided for, semiannually in arrears on February
1 and August 1 of each year, commencing on August 1,
1999, in cash, to the Holder hereof until the principal amount hereof is paid or
made available for payment. The interest so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, subject to certain exceptions
provided in the Indenture, be paid to the Person in whose name this Note (or the
Note in exchange or substitution for which this Note was issued) is registered
at the close of business on the Record Date for interest payable on such
Interest Payment Date. The Record Date for any interest payment is the close of
business on January 15 or July 15, as the case may be, whether or not a Business
Day, immediately preceding the Interest Payment Date on which such interest is
payable. Any such interest not so punctually paid or duly provided for
("Defaulted Interest") shall forthwith cease to be payable to the Holder on such
Record Date and shall be paid as provided in Section 2.12 of the Indenture.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months.
Each payment of interest in respect of an Interest Payment Date will
include interest accrued through the day before such Interest Payment Date. If
an Interest Payment Date falls on a day that is not a Business Day, the interest
payment to be made on such Interest Payment Date will be made on the next
succeeding Business Day with the same force and effect as if made on such
Interest Payment Date, and no additional interest will accrue as a result of
such delayed payment.
If this Note is issued pursuant to a Registered Exchange Offer on or prior
to the Record Date for the first Interest Payment Date following such exchange,
accrued and unpaid interest on the equivalent principal amount of the Initial
Note in exchange for which this Note was issued, up to but not including the
date of issuance of this Note, shall be paid on the first Interest Payment Date
for this Note to the Holder of this Note on the first Record Date with respect
to this Note. If this Note is issued pursuant to a Registered Exchange Offer
subsequent to the Record Date for the first Interest Payment Date following such
exchange but on or prior to such Interest Payment Date, then any such accrued
and unpaid interest with respect to the equivalent principal amount of the
Initial Note in exchange for which this Note was issued and any accrued and
unpaid interest on this Note through the day before such Interest Payment Date
shall be paid on such Interest Payment Date to the Holder of such Initial Note
on such Record Date.
To the extent lawful, the Issuer shall pay interest on overdue principal,
overdue premium, Defaulted Interest and overdue Liquidated Damages (without
regard to any applicable grace period) at the interest rate borne on this Note.
The Issuer's obligation pursuant to the previous sentence shall apply whether
such overdue amount is due at its maturity, as a result of the Issuer's
obligations pursuant to Section 3.05, Section 4.11 or Section 4.14 of the
Indenture, or otherwise.
3. Method of Payment.
The Issuer, through the Paying Agent, shall pay interest on this Note to
the registered Holder of this Note, as provided above. The Holder must surrender
this Note to a Paying Agent to collect principal payments. The Issuer will pay
principal, premium, if any, and interest and Liquidated Damages, if any, in
money of the United States of America that at the time of payment is legal
tender for payment of all debts public and private. Principal, premium, if any,
and interest and Liquidated Damages, if any, shall be paid by check mailed to
the registered
Holders at their registered addresses; provided, that all payments with respect
to Notes the Holders of which have given wire transfer instructions to the
Issuer will be required to be made by wire transfer of immediately available
funds to the accounts specified by the Holders thereof.
4. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and Registrar under the
Indenture. The Issuer may, upon written notice to the Trustee, appoint and
change any Paying Agent or Registrar. The Issuer or any of its Affiliates may
act as Paying Agent or Registrar, provided, that if the Issuer or such Affiliate
is acting as Paying Agent, the Issuer or such Affiliate shall segregate all
funds held by it as Paying Agent and hold them in trust for the benefit of the
Holders or the Trustee.
5. Guarantees.
This Note is initially entitled to the benefits of the Guarantees made by
the Guarantors listed on Annex A hereto and may thereafter be entitled to
Guarantees made by other Guarantors for the benefit of the Holders of Notes.
Each present Guarantor has, and each future Guarantor will, irrevocably and
unconditionally, jointly and severally, guarantee on a senior subordinated basis
the punctual payment when due, whether at Stated Maturity, by acceleration, in
connection with a Change of Control Offer, an Asset Sale Offer or redemption, or
otherwise, of all obligations of the Issuer under the Indenture and this Note,
whether for payment of principal of, premium, if any, interest or Liquidated
Damages, if any, on the Notes, expenses, indemnification or otherwise. A
Guarantor shall be released from its Guarantee upon the terms and subject to the
conditions set forth in the Indenture.
6. Subordination.
This Note and the Guarantees are subordinated in right of payment, as set
forth in the Indenture, to the prior payment in full of all existing and future
Senior Indebtedness. Each of the Issuer and the Guarantors agrees, and each
Holder by accepting a Note agrees, to the subordination provisions set forth in
the Indenture, authorizes the Trustee to give them effect and appoints the
Trustee as attorney-in-fact for such purpose.
7. Redemption.
Except as set forth in the following paragraph, the Notes are not
redeemable at the option of the Issuer prior to February 1, 2004. Thereafter,
the Notes will be subject to redemption at the option of the Issuer, in whole or
in part, on at least 20 calendar days, but not more than 60 calendar days, prior
notice, at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest thereon, if any, and
Liquidated Damages, if any, to the applicable Redemption Date (subject to the
right of each Holder of record on the relevant Record Date to receive interest
due on the relevant Interest Payment Date), if redeemed during the twelve-month
period beginning February 1 of the years indicated below:
Year Percentage
---- ----------
2004 105.188%
2005 103.458%
2006 101.729%
2007 and thereafter 100.000%
In addition, at any time and from time to time prior to February 1, 2002
the Issuer, at its option, may redeem in the aggregate up to 25.0% of the
original principal amount of the Notes with the Net Cash 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 110.375% of
the aggregate principal amount so redeemed, plus accrued and unpaid interest and
Liquidated Damages, if any, thereon to the applicable 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 75.0% of the original principal amount of the Notes must remain
outstanding after each such redemption; and provided, further, that each such
redemption shall occur within 60 days of the date of closing of the related
Public Equity Offering.
8. Notice of Redemption.
At least 30 calendar days but not more than 60 calendar days before a
Redemption Date, the Issuer shall deliver to the Trustee a notice of redemption.
At least 20 calendar days but not more than 60 calendar days before a Redemption
Date, the Issuer shall send, by first-class mail, postage prepaid, to Holders of
Notes to be redeemed at the addresses of such Holders as they appear in the Note
Register, a notice of redemption.
If fewer than all the Notes are to be redeemed at any time, the Trustee
shall select the Notes to be redeemed pro rata or by lot or by a method that
complies with applicable legal and securities exchange requirements, if any, and
that the Trustee considers 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 Notes not previously
called for redemption; provided, that the Trustee may select for redemption
portions (equal to $1,000 or any integral multiple thereof) of the principal of
Notes that have denominations larger than $1,000 (Notes in denominations of
$1,000 may be redeemed only in whole). If any Note is redeemed subsequent to a
Record Date with respect to any Interest Payment Date specified above and on or
prior to such Interest Payment Date, then any accrued interest will be paid on
such Interest Payment Date to the Holder of the Note on such Record Date. If
money in an amount sufficient to pay the Redemption Price of all Notes (or
portions thereof) to be redeemed on the Redemption Date is deposited with the
Paying Agent on or before the applicable Redemption Date and certain other
conditions are satisfied, interest on the Notes or portions thereof to be
redeemed on the applicable Redemption Date will cease to accrue.
9. Repurchase at the Option of Holders upon Change of Control.
Upon the occurrence of a Change of Control, each Holder shall have the
right in accordance with the terms hereof and the Indenture to require the
Issuer to purchase such Holder's Notes, in whole or in part, in a principal
amount that is an integral multiple of $1,000, pursuant to a Change of Control
Offer, at a purchase price in cash equal to 101% of the principal amount of such
Notes (or portions thereof) plus accrued and unpaid interest and Liquidated
Damages, if any, to the Change of Control Payment Date.
Within 30 calendar days following any Change of Control, the Issuer shall
send, or cause to be sent, by first-class mail, postage prepaid, a notice
regarding the Change of Control Offer to each Holder with a copy to the Trustee.
The Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Change of Control Offer. Unless the Issuer defaults in the payment of the
Change of Control Purchase Price with respect thereto, all Notes or portions
thereof accepted for payment pursuant to the Change of Control Offer will cease
to accrue interest from and after the Change of Control Payment Date.
Prior to complying with the provisions of the Indenture governing Change
of Control Offers, but in any event within 30 calendar days following a Change
of Control, the Issuer shall, to the extent required, either repay all
outstanding Senior Indebtedness or obtain the requisite consents, if any, under
all agreements governing outstanding Senior Indebtedness to permit the
repurchase of Notes required by the provisions of the Indenture governing Change
of Control Offers.
10. Repurchase at the Option of Holders upon Asset Sale.
If at any time the Issuer or any Restricted Subsidiary engages in any
Asset Sale, as a result of which the aggregate amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall, within 30 calendar days of the date the amount
of Excess Proceeds exceeds $5.0 million, use the then-existing Excess Proceeds
to make an offer to purchase from all Holders of Notes, on a pro rata basis,
Notes in an aggregate principal amount equal in amount to the then-existing
Excess Proceeds, at a purchase price in cash in an amount equal to 100% of the
principal amount thereof plus accrued and unpaid interest thereon and Liquidated
Damages to the Asset Sale Purchase Date (subject to the right of each Holder of
record on the relevant Record Date to receive interest due on the relevant
Interest Payment Date). Upon completion of an Asset Sale Offer (including
payment of the Asset Sale Purchase Price for accepted Notes), any surplus Excess
Proceeds that were the subject of such offer shall cease to be Excess Proceeds,
and the Issuer may then use such amounts for general corporate purposes.
Within 30 calendar days of the date the amount of Excess Proceeds exceeds
$5.0 million, the Issuer shall send, or cause to be sent, by first-class mail,
postage prepaid, a notice regarding the Asset Sale Offer to each Holder. The
Holder of this Note may elect to have this Note or a portion hereof in an
authorized denomination purchased by completing the form entitled "Option of
Holder to Elect Purchase" appearing below and tendering this Note pursuant to
the Asset Sale
Offer. Unless the Issuer defaults in the payment of the Asset Sale Purchase
Price with respect thereto, all Notes or portions thereof selected for payment
pursuant to the Asset Sale Offer will cease to accrue interest from and after
the Asset Sale Purchase Date.
11. Transfer and Exchange.
A Holder may transfer or exchange Notes as provided in the Indenture and
subject to certain limitations therein set forth. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes, fees and expenses required by law or permitted
by the Indenture. The Registrar need not register the transfer or exchange of
Certificated Notes or portions thereof selected for redemption (except, in the
case of a Certificated Note to be redeemed in part, the portion of such
Certificated Note not to be redeemed) or any Certificated Notes for a period of
15 calendar days before a selection of Notes to be redeemed.
12. Denominations.
The Notes are issuable only in registered form without coupons in
denominations of $1,000 and integral multiples thereof of principal amount.
13. Discharge and Defeasance.
Subject to certain conditions, the Issuer at any time may terminate some
or all of the obligations of the Issuer and the Guarantors under the Notes, the
Guarantees and the Indenture if the Issuer irrevocably deposits in trust with
the Trustee cash or U.S. Government Obligations for the payment of principal,
premium, if any, interest and Liquidated Damages, if any, on the Notes 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 Notes may be amended with the written consent of the Holders of
at least a majority in principal amount of the outstanding Notes (which consent
may, but need not, be given in connection with any tender offer or exchange
offer for the Notes) and (ii) any past Default and its consequences or any
compliance with any provisions of the Indenture may be waived with the written
consent of the Holders of at least a majority in principal amount of the
outstanding Notes. Subject to certain exceptions set forth in the Indenture,
without the consent of any Holder, the Issuer and the Trustee may amend the
Indenture or the Notes (i) to evidence the succession of another Person to the
Issuer and the assumption by such successor of the covenants of the Issuer under
the Indenture and contained in the Notes; (ii) to add to the covenants of the
Issuer, for the benefit of the Holders of all of the Notes, or to surrender any
right or power conferred on the Issuer under the Indenture; (iii) to provide for
uncertificated Notes in addition to or in place of Certificated Notes; (iv) to
secure the Notes; (v) to cure any ambiguity, omission, defect or inconsistency
in the Indenture; (vi) to comply with the requirements of the SEC in order to
effect or maintain the qualification of the Indenture under the TIA; or (vii) to
evidence the agreement or
acknowledgment of a Restricted Subsidiary that it is a Guarantor for all
purposes under the Indenture (including, without limitation, Article 12
thereof).
15. Defaults and Remedies.
Under the Indenture, Events of Default include: (i) a default for 30 days
in the payment when due of interest on, or Liquidated Damages with respect to,
the Notes (whether or not prohibited by the subordination provisions of the
Indenture); (ii) a default in the payment when due of the principal of or
premium, if any, on the Notes (whether or not prohibited by the subordination
provisions of the Indenture), (iii) failure by the Issuer to observe or perform
certain covenants, conditions, agreements or other provisions of the Indenture
or this Note (and, in the case of certain covenants, agreements or other
provisions, such failure has continued after written notice by the Trustee or
the Holders of at least 25% in principal amount of the Notes for a time period
specified in such notice); (iv) a default in the payment of Indebtedness of the
Issuer or any of its Subsidiaries within any applicable grace period after final
maturity or acceleration of such Indebtedness in an amount in excess of $5.0
million in the aggregate; (v) certain events of bankruptcy or insolvency with
respect to the Issuer or any of its Subsidiaries, (vi) certain undischarged
judgments in excess of $5.0 million against the Issuer or any of its
Subsidiaries; or (vii) the Guarantee of any Guarantor ceasing for any reason to
be in full force and effect (other than in accordance with the terms of the
Indenture) or any Guarantor denying or affirming its obligations under its
Guarantee.
If an Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the Notes, subject to certain
limitations, may declare all the Notes to be immediately due and payable.
Certain events of bankruptcy or insolvency shall result in the Notes being
immediately due and payable upon the occurrence of such Events of Default
without any further act of the Trustee or any Holder.
Holders of Notes may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Notes may
direct the Trustee in its exercise of any trust or power under the Indenture.
The Holders of a majority in principal amount of the then outstanding Notes, by
written notice to the Trustee and the Issuer, may rescind any declaration of
acceleration and its consequences if the rescission would not conflict with any
judgment or decree, and if all existing Events of Default have been cured or
waived, except nonpayment of principal, interest, premium or Liquidated Damages
that has become due solely because of acceleration. No such rescission shall
affect any subsequent Default or impair any right consequent thereto.
16. Individual Rights of Trustee.
Subject to certain limitations imposed by the TIA, the Trustee or any
Paying Agent or Registrar, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Issuer, the
Guarantors or their Affiliates with the same rights it would have if it were not
Trustee, Paying Agent or Registrar, as the case may be, under the Indenture.
17. No Recourse Against Certain Others.
No director, officer, employee, incorporator or stockholder of the Issuer
or any Guarantor, as such, shall have any liability for any obligations of the
Issuer or such Guarantor under the Notes, the Guarantees or the Indenture or for
any claim based on, in respect of, or by reason of, such obligations or their
creation, solely by reason of its status as a director, officer, employee,
incorporator or stockholder of the Issuer or such Guarantor. By accepting a
Note, each Holder waives and releases all such liability (but only such
liability) as part of the consideration for issuance of such Note to such
Holder.
18. Authentication.
This Note shall not be valid until the Trustee or an authenticating agent
manually signs the certificate of authentication on the other side of this Note.
19. Abbreviations.
Customary abbreviations may be used in the name of a Holder 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).
20. CUSIP Numbers.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Issuer has caused CUSIP numbers to be
printed on the Notes and has directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Holders of Notes. No representation is
made as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
21. Governing Law.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN SAID STATE.
The Issuer will furnish to any Holder upon written request and without
charge to the Holder a copy of the Indenture. Requests may be made to:
Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
ASSIGNMENT
(To be executed by the registered Holder
if such Holder desires to transfer this Note)
FOR VALUE RECEIVED _________________________________ hereby sells, assigns
and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
TAX IDENTIFYING NUMBER OF TRANSFEREE
-------------------------------
-------------------------------------------------------------------------------
(Please print name and address of transferee)
this Note, together with all right, title and interest herein, and does hereby
irrevocably constitute and appoint ________________________________ Attorney to
transfer this Note on the Note Register, with full power of substitution.
Dated:_________________________
--------------------------------- -------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing Assignment must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
OPTION OF HOLDER TO ELECT PURCHASE
(check as appropriate)
(TM) In connection with the Change of Control Offer made pursuant to Section
4.14 of the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $______________________ ($1,000 in principal amount or an integral
multiple thereof) of this Note repurchased by the Issuer. The undersigned
hereby directs the Trustee or Paying Agent to pay it or
___________________________ an amount in cash equal to 101% of the
principal amount indicated in the preceding sentence plus accrued and
unpaid interest and Liquidated Damages thereon, if any, to the Change of
Control Payment Date.
(TM) In connection with the Asset Sale Offer made pursuant to Section 4.11 of
the Indenture, the undersigned hereby elects to have
(TM) the entire principal amount
(TM) $_______________ ($1,000 in principal amount or an integral multiple
thereof) of this Note repurchased by the Issuer. The undersigned hereby
directs the Trustee or Paying Agent to pay it or _______________________
an amount in cash equal to 100% of the principal amount indicated in the
preceding sentence plus accrued and unpaid interest and Liquidated Damages
thereon, if any, to the Asset Sale Purchase Date.
Dated:_______________________
--------------------------------- -------------------------------------
Signature of Holder Signature Guaranteed:
NOTICE: The signature to the foregoing must correspond to the Name as written
upon the face of this Note in every particular, without alteration or any change
whatsoever.
SIGNATURE GUARANTEED: Signature must be guaranteed by an Eligible Guarantor
Institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion program
pursuant to Securities and Exchange Commission Rule 17Ad-15.
ANNEX A
LIST OF GUARANTORS
EXHIBIT E
FORM OF TRANSFER CERTIFICATE
FOR TRANSFER TO A QIB
Chase Manhattan Bank
Corporate Trust-Customer Service
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Re: Phoenix Color Corp. (the "Issuer") 10-3/8% Senior Subordinated Notes
due 2009 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of February 2, 1999 (as
amended and supplemented from time to time, the "Indenture") among the Issuer,
the Guarantors named therein, and Chase Manhattan Trust Company, National
Association, as Trustee. Capitalized terms used but not defined herein shall
have the meanings given them in the Indenture. This letter relates to
$_______________ aggregate principal amount of Notes which are held in the name
of [name of transferor] (the "Transferor") to effect the transfer of such Notes
in exchange for an equivalent beneficial interest in the Initial Global Note.
In connection with such request, and with respect to such Notes, the
Transferor does hereby certify that such Notes are being transferred in
accordance with (i) the transfer restrictions set forth in the Notes and (ii)
Rule 144A under the United States Securities Act of 1933, as amended ("Rule
144A"), to a transferee that the Transferor reasonably believes is purchasing
the Notes for its own account or an account with respect to which the transferee
exercises sole investment discretion, and the transferee, as well as any such
account, is a "qualified institutional buyer" within the meaning of Rule 144A,
in a transaction meeting the requirements of Rule 144A and in accordance with
applicable securities laws of any state of the United States or any other
jurisdiction.
You and the Issuer 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 Transferor]
By:_______________________________________
Name:
Title:
Date:____________________________
cc: Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
EXHIBIT F
FORM OF TRANSFER CERTIFICATE FOR TRANSFER TO AN
INSTITUTIONAL ACCREDITED INVESTOR
Chase Manhattan Bank
Corporate Trust-Customer Service
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Re: Phoenix Color Corp. (the "Issuer") 10-3/8% Senior Subordinated Notes
due 2009 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of February 2, 1999 (as
amended and supplemented from time to time, the "Indenture") among the Issuer,
the Guarantors named therein, and Chase Manhattan Trust Company, National
Association, as Trustee. Capitalized terms used but not defined herein shall
have the meanings given them in the Indenture.
This letter relates to U.S. $ aggregate principal amount of Notes which
are held [in certificated form in the name of [name of transferor] (the
"Transferor")] [through the beneficial interest of [name of transferor] (the
"Transferor") in the Initial Global Note] to effect the transfer of such Notes
to an institutional "accredited investor" as defined in Rule 501 (a)(1), (2),
(3) or (7) of Regulation D under the Securities Act of 1933, as amended (an
"Institutional Accredited Investor").
In connection with such request, and with respect to such Notes, the
Transferor does hereby certify that such Notes are being transferred (i) in
accordance with the transfer restrictions set forth in the Notes, (ii) to a
transferee that the Transferor reasonably believes is an Institutional
Accredited Investor that is acquiring at least $250,000 principal amount of
Notes for its own account or for one or more accounts as to which the transferee
exercises sole investment discretion and (iii) in accordance with applicable
securities laws of any state of the United States or any other jurisdiction.
You and the Issuer 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.
Very truly yours,
__________________________________________
[Name of Transferor]
By:_______________________________________
Name:
Title:
Date:____________________________
cc: Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
EXHIBIT G
FORM OF INVESTMENT LETTER
FOR INSTITUTIONAL ACCREDITED INVESTORS
Chase Manhattan Bank
Corporate Trust-Customer Service
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Re: Phoenix Color Corp. (the "Issuer") 10-3/8% Senior Subordinated Notes
Due 2009 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of February 2, 1999 (as
amended and supplemented from time to time, the "Indenture") among the Issuer,
the Guarantors named therein, and Chase Manhattan Trust Company, National
Association, as Trustee. Capitalized terms used but not defined herein shall
have the meanings given them in the Indenture.
In connection with our proposed purchase of $___________ aggregate
principal amount of Notes, we confirm that:
1. We understand that the Notes have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), and may not be sold
except as permitted in the following sentence. We understand and agree, on our
own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, (x) that such Notes are being offered only in a transaction not
involving any public offering within the meaning of the Securities Act, (y) that
if we should resell, pledge or otherwise transfer such Notes within two years
after the later of the date of the original issuance of the Notes and the last
date on which the Issuer or any affiliate (within the meaning of Rule 144 under
the Securities Act ("Rule 144")) of the Issuer was the owner of such Notes (or
any predecessor of such Notes), or within three months after we cease to be an
affiliate of the Issuer, such Notes may be resold, pledged or transferred only
(i) to the Issuer, (ii) so long as Notes are eligible for resale pursuant to
Rule 144A under the Securities Act ("Rule 144A"), to a person whom we reasonably
believe is a "qualified institutional buyer" (as defined in Rule 144A) ("QIB")
that purchases for its own account or for the account of a QIB to whom notice is
given that the resale, pledge or transfer is being made in reliance on Rule
144A, (iii) in an offshore transaction in accordance with Regulation S under the
Securities Act, (iv) to an institution that is an "accredited investor" as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act ("Institutional Accredited Investor") that has certified to the Issuer and
the Trustee that it is such an accredited investor and is acquiring the Notes
for investment purposes and not for distribution, (v) pursuant to an effective
registration statement under the Securities Act or (vi) pursuant to any other
available exemption from the registration
requirements of the Securities Act, in each case in accordance with any
applicable securities laws of any state of the United States, and we will notify
any purchaser of the Notes from us of the above resale restrictions, if then
applicable. We further understand that, in connection with any transfer of the
Notes by us, the Issuer and the Trustee may request, and if so requested we will
furnish, such certificates, legal opinions and other information as they may
reasonably require to confirm that any such transfer complies with the foregoing
restrictions. We understand that the Notes will be issued in registered form
only and that any certificates issued will bear a legend substantially to the
effect set forth in the Indenture.
2. We are able to fend for ourselves in this transaction, we have such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of our investment in the Notes, and we and any
accounts for which we are acting are each able to bear the economic risk of our
or its investment and can afford the complete loss of such investment.
3. We understand that the minimum principal amount of Notes purchased by
an Institutional Accredited Investor is $250,000.
4. We understand that the Issuer, the Trustee and others will rely upon
the truth and accuracy of the foregoing acknowledgments, representations and
agreements, and we agree that if any of the acknowledgments, representations and
warranties deemed to have been made by us by our purchase of Notes, for our own
account or for one or more accounts as to each of which we exercise sole
investment discretion, are no longer accurate, we shall promptly notify the
Issuer and the Trustee.
5. We are acquiring the Notes purchased by us for investment purposes, and
not for distribution, for our own account or for one or more accounts as to each
of which we exercise sole investment discretion and we are or such account is an
Institutional Accredited Investor.
6. You are entitled to rely upon this letter and you 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 Purchaser]
By:_______________________________________
Name:
Title:
Date:____________________________
cc: Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
EXHIBIT H
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
TO A NON-U. S. PERSON
Chase Manhattan Bank
Corporate Trust-Customer Service
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Re: Phoenix Color Corp. (the "Issuer") 10-3/8% Senior Subordinated Notes
due 2009 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of February 2, 1999 (as
amended and supplemented from time to time, the "Indenture") among the Issuer,
the Guarantors named therein, and Chase Manhattan Trust Company, National
Association, as Trustee. Capitalized terms used but not defined herein shall
have the meanings given them in the Indenture.
This letter relates to $ aggregate principal amount of Notes which are
held [in certificated form in the name of [name of transferor] (the
"Transferor")] [through the beneficial interest of [name of transferor] (the
"Transferor") in the Initial Global Note] to effect the transfer of such Notes
in exchange for Initial Certificated Notes.
In connection with such request, the Transferor does hereby certify that
such Notes are being transferred in accordance with (i) the transfer
restrictions set forth in the Notes and (ii) Regulation S ("Regulation S") under
the United States Securities Act of 1933, as amended (the "Securities Act") and
does hereby further certify that:
(1) the offer of the Notes was not made to a person in the United States;
(2) the transaction was executed in, on or through the facilities of a
designated offshore securities market, and neither the Transferor, nor any
person acting on its behalf knows that the transaction was pre-arranged
with a buyer in the United States;
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 903(b) or 904(b)of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
In addition, if the sale is made during a Restricted Period (as defined in
Regulation S) and the provisions of Rule 903(c)(2) or (3) or Rule 904(c)(1) of
Regulation S are applicable thereto, we confirm that such sale has been made in
accordance with the applicable provisions of Rule 903(c)(2) or (3) or Rule
904(c)(1), as the case may be.
You and the Issuer 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 Purchaser]
By:_______________________________________
Name:
Title:
Date:____________________________
cc: Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
EXHIBIT I
FORM OF INVESTMENT LETTER
FOR REGULATION S PURCHASERS
Chase Manhattan Bank
Corporate Trust-Customer Service
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Re: Phoenix Color Corp. (the "Issuer") 10-3/8% Senior Subordinated Notes
due 2009 (the "Notes")
Ladies and Gentlemen:
Reference is hereby made to the Indenture dated as of February 2, 1999 (as
amended and supplemented from time to time, the "Indenture") among the Issuer,
the Guarantors named therein, and Chase Manhattan Trust Company, National
Association, as Trustee. Capitalized terms used but not defined herein shall
have the meanings given them in the Indenture.
In connection with our proposed purchase of $ aggregate principal amount
of the Notes which are held [in certificated form in the name of [name of
transferor] (the "Transferor")] [through the beneficial interest of [name of
transferor] (the "Transferor") in the Initial Global Note], we hereby certify
that we are (or we will hold such Notes on behalf of) a person outside the
United States to whom the Notes could be transferred in accordance with Rule 904
of Regulation S promulgated under the United States Securities Act of 1933, as
amended.
You and the Issuer 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 Purchaser]
By:_______________________________________
Name:
Title:
Date:____________________________
cc: Phoenix Color Corp.
000 Xxxxxxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxx
EXHIBIT J
FORM OF REGISTRATION RIGHTS AGREEMENT
[Attached]
